
<PAGE>




[*] -- Certain information omitted and filed separately with the Commission
pursuant to a confidential treatment request under Rule 24b-2 of the Commission.

                                SECOND AMENDMENT
                              TO PURCHASE AGREEMENT

SECOND AMENDMENT (this "Amendment"), dated and effective as of the 9th day of
December, 1997 (the "Effective Date"), to the PURCHASE AGREEMENT dated September
6, 1996 , as amended by the FIRST AMENDMENT dated April 22, 1997 (as thus
amended, the "Purchase Agreement" or "Agreement"), between CREE RESEARCH, INC.
("Seller"), a corporation organized under the laws of the State of North
Carolina, the United States of America, and SIEMENS AKTIENGESELLSCHAFT
("Purchaser"), a corporation organized under the laws of the Federal Republic of
Germany. As used in this Amendment, capitalized terms not defined herein which
are defined in the Purchase Agreement shall have the meaning defined in the
Purchase Agreement.

In consideration of the mutual provisions below the parties hereby agree as
follows:

1.      The Purchase Agreement is amended by incorporating SUPPLEMENT NO. 1 TO
        SCHEDULE 1 annexed hereto as an addendum to the FIRST AMENDED SCHEDULE
        1.

2.      The Purchase Agreement is amended by incorporating SUPPLEMENT NO. 1 TO
        SCHEDULE 2 annexed hereto as an addendum to the FIRST AMENDED SCHEDULE
        2.

3.      The Purchase Agreement is amended by replacing the FIRST AMENDED
        SCHEDULE 3 in its entirety with the SECOND AMENDED SCHEDULE 3 annexed
        hereto.

4.      Purchaser acknowledges that all Products delivered under the Purchase
        Agreement prior to the Effective Date of this Amendment conformed to the
        then applicable Product Specifications.

5.      Seller and Purchaser will continue to work to improve the ESD
        sensitivity of the Product, as provided in SCHEDULE 4 of the Purchase
        Agreement, with a goal developing a mutually acceptable improved Product
        with a minimum RAET rating of ******* (as measured using the RAET method
        described in the Product Specifications contained in SECOND AMENDED
        SCHEDULE 3) for all shipments to be made on and after October 1, 1998.

6.      Seller represents to Purchaser that the Product version described by the
        Product Specifications contained in SECOND AMENDED SCHEDULE 3 was sample
        tested as having Class 2 ESD sensitivity (i.e., greater than 2kVolts and
        less than or equal to 4kVolts) based on the results of testing conducted
        by Seller during the week of October 20, 1997 in accordance with the
        procedures of MIL-STD-883C, Notice 5, Method 3015.4, entitled
        "Electrostatic Discharge Sensitivity Classification."

7.      Except as amended hereby, the terms and conditions of the Purchase
        Agreement shall continue in effect.

IN WITNESS WHEREOF, the parties, through their respective duly authorized
officers, have executed this Amendment to be effective as of the Effective Date
set out in the preamble hereto.

CREE RESEARCH, INC.                  SIEMENS AKTIENGESELLSCHAFT

By  /s/ F. Neal Hunter            By /s/ C. Hagen
    -------------------------        -------------------------------------------
    F. Neal Hunter, President        C. Hagen, Vice President-Finance and Admin.

                                  By /s/ N. Hiller
                                     -------------------------------------------
                                     N. Hiller, Marketing Manager

Date  December 9, 1997            Date     December 9, 1997
      -----------------------              -------------------------------------


11206-F1


<PAGE>


                         SUPPLEMENT NO. 1 TO SCHEDULE 1

                         Quantity and Shipment Schedule

1.       QUANTITY AND SELECTION. During the period commencing ******************
         and ending ******* ********, Purchaser will purchase a total of
         ***************** units of the Product.

2.       SHIPMENT SCHEDULE. The shipment schedule for the units to be shipped
         under this SUPPLEMENT NO. 1 is set out below. Subject to the provisions
         of this Agreement, each monthly quantity shown below shall be shipped
         on the last day of the month unless otherwise mutually agreed. The
         target Product versions noted in the schedule below reflect current
         development goals as of November 1997 but are not intended as
         contractual commitments.

<TABLE>
<CAPTION>

         ------------------------ ------------------------- -------------------------
                  Month                   Quantity               Target Version
         ------------------------ ------------------------- -------------------------
         <S>                      <C>                       <C>
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ************************ ***********************   ************************
         ------------------------ ------------------------- -------------------------
</TABLE>

3. RESCHEDULING OF SHIPMENTS. Purchaser may without charge reschedule shipments
as follows:

         (a)      for quantities scheduled to be shipped more than 24 weeks but
                  within 52 weeks following Seller's receipt of written notice
                  from Purchaser requesting rescheduling, up to thirty percent
                  (30%) of the quantity originally scheduled to be shipped
                  during such period;

         (b)      for quantities scheduled to be shipped more than 12 weeks but
                  within 24 weeks following Seller's receipt of written notice
                  from Purchaser requesting rescheduling, up to fifteen percent
                  (15%) of the quantity originally scheduled to be shipped
                  during such period.

        In all other cases Purchaser may reschedule shipments only with Seller's
        mutual written agreement. Purchaser's notice requesting rescheduling
        must specify the quantity to be deferred and the date on which shipment
        is to be made. In no event, however, shall Purchaser be entitled to
        reduce shipments in any calendar month to less than ********** units,
        nor shall Seller be obligated to ship more than ************ units in
        any calendar month. No shipment shall be delayed beyond June 30, 1999.
        Subject to the foregoing, a shipment may be rescheduled any number of
        times under this paragraph.

4.      CANCELLATION OF SHIPMENTS. Purchaser shall be entitled to cancel
        shipment of all or any portion of the monthly quantities scheduled as
        shown above, provided Purchaser pays Seller a cancellation charge of
        $**** per unit for all quantities canceled and Seller receives written
        notice specifying the canceled quantities at least five (5) calendar
        months prior to the first day of the calendar month in which such
        quantities are scheduled to be shipped. The cancellation charges shall
        be due and payable within thirty (30) days after the date notice of
        cancellation is given. The parties agree that the amount of such
        cancellation charges represents a reasonable estimate of Seller's
        damages resulting from cancellation and shall be due and payable as
        liquidated damages and not as a penalty.



                                     Page 2


<PAGE>



        5. PURCHASE ORDERS. Purchaser will submit written purchase orders
        evidencing its commitment to purchase Products under this SUPPLEMENT NO.
        1 TO SCHEDULE 1 prior to each scheduled shipment date. Such purchase
        orders may be submitted by through Purchaser's offices in Regensburg,
        Germany, or through any other Siemens Semiconductor location authorized
        by Purchaser. In the event Purchaser requests delivery of shipments to a
        Siemens Semiconductor location other than Regensburg, Germany,
        Purchaser's personnel at such location shall be authorized to act on
        Purchaser's behalf with respect to scheduling and acceptance of
        shipments and other matters relating thereto. The terms and conditions
        of this Agreement shall govern the purchase of Products hereunder
        notwithstanding any contrary provisions of any purchase order submitted
        by Purchaser.


                                     Page 3



<PAGE>


                         SUPPLEMENT NO. 1 TO SCHEDULE 2

                           Price and Payment Schedule

1.       PRICES.

        (a)       Prices of units shipped pursuant to SUPPLEMENT NO. 1 TO
                  SCHEDULE 1 shall be as follows, subject to adjustment as
                  provided in paragraph (b) below:

                  ---------------------------------- ------------------------
                       Incremental Quantities           Unit Price (US$)
                  ---------------------------------- ------------------------
                     **************************             ********
                     **************************             ********
                     **************************             ********
                     **************************             ********
                  ---------------------------------- ------------------------

                  The reduction in per unit prices for larger quantities
                  reflects Seller's expectation that it will improve
                  manufacturing yields and reduce per unit costs as the
                  quantities manufactured increase. Nonetheless, the above
                  prices are firm and are not subject to any adjustment on
                  account of lower than expected manufacturing yields, increased
                  costs or other factors.

        (b)       Purchaser and Seller will share the risk of currency exchange
                  rate fluctuations, as provided in this paragraph, for units
                  shipped pursuant to SUPPLEMENT NO. 1 TO SCHEDULE 1. The unit
                  price for such shipments shall be adjusted by the applicable
                  percentage below according to the value of the "DM-Dollar
                  Exchange Rate" on the shipment date. For purposes of this
                  paragraph, the "DM-Dollar Exchange Rate" means the average of
                  the foreign exchange selling rates for German Marks per U.S.
                  Dollar, as published in the Wall Street Journal during the
                  thirty (30) calendar days preceding the date of shipment, for
                  rates quoted in New York the preceding business day for
                  trading among banks in amounts of $1 million or more.

<TABLE>
<CAPTION>
                  ------------------------------------------------------------- -------------------------
                                    DM-Dollar Exchange Rate                         Percentage Price
                                                                                       Adjustment
                  ------------------------------------------------------------- -------------------------
                  <S>                                                            <C>
                  Equal to or greater than 1.95                                    *****************
                  Equal to or greater than 1.85 and less than 1.95                 *****************
                  Greater than 1.65 and less than 1.85                             *****************
                  Equal to or less than 1.65 and greater than 1.55                 *****************
                  Equal to or less than 1.55                                       *****************
                  ------------------------------------------------------------- -------------------------
</TABLE>


         (c)      Prices of units shipped pursuant to SCHEDULE 1 (as previously
                  amended) shall continued to be determined as set forth in
                  SCHEDULE 2 (as previously amended), subject to adjustment as
                  provided therein.

2.       PAYMENT TERMS.

         (a)      Units shipped pursuant to SUPPLEMENT NO. 1 TO SCHEDULE 1 will
                  be invoiced upon shipment and such invoices shall be due and
                  payable within twenty (20) days from the invoice date.

         (b)      Prices of units shipped pursuant to SCHEDULE 1 (as previously
                  amended) shall be paid in accordance with SCHEDULE 2 (as
                  previously amended).


                                     Page 4

<PAGE>


                            SECOND AMENDED SCHEDULE 3

                             Product Specifications

1.       Product Specifications for units shipped on and after November 1, 1997
         shall be those set forth in Attachment A. Product Specifications for
         units shipped prior to that date shall be those set forth in SCHEDULE 3
         as previously amended.

2.       Seller may elect to substitute a version of Product which uses a
         conductive buffer layer, subject to Purchaser's approval which shall be
         given under the terms and conditions set forth below. Commencing thirty
         (30) days after the date of such approval, or such earlier date as may
         be agreed by the parties, the Product Specifications applicable to
         shipments made thereafter shall be the specifications of the new
         version supplied by Seller as provided below, and Seller may not ship
         the original version without Purchaser's prior written consent.

         (a)      The new version must meet the original specifications except
                  that *********************************************************
                  **************************************************************
                  ***************************************.

         (b)      Seller will provide Purchaser with production prototypes of
                  the new version manufactured from wafers from at least three
                  different epi runs and will provide Purchaser the
                  specifications applicable to the new version and such
                  qualification data as may then be available to Seller.

         (c)      Purchaser will give Seller notice of Purchaser's approval or
                  disapproval within seventy-five (75) days after receipt of the
                  prototypes and specifications.

         (d)      Purchaser may withhold its approval only if new version does
                  not meet the minimum specifications described in (a) above.

3.       Prior to shipping a conductive buffer Product version as permitted
         above or any other changed version as may be mutually agreed by the
         parties, Seller will conduct a test of the new Product version in
         accordance with the procedures of MIL-STD-883C, Notice 5, Method
         3015.4, entitled "Electrostatic Discharge Sensitivity Classification"
         and inform Purchaser of the results of such testing. The changed
         version shall not be shipped unless it is sample tested as having at
         least Class 2 ESD sensitivity according to the results of such test.
         Seller is only obligated to qualify new Product versions using the
         MIL-STD-883C method and is not obligated to test individual units using
         such method.

4.       Seller will test and inspect all Product units in accordance with
         Seller's quality assurance procedures described in Seller's document
         CPT-026 dated July 17, 1997 and will ship only units passing such
         procedures.


                                     Page 5

<PAGE>



                                                                 ATTACHMENT A TO
                                                       SECOND AMENDED SCHEDULE 3

Information in attachment omitted in its entirety and 
filed separately with the Commission pursuant to a 
confidential treatment request under Rule 24b-2 of the Commission.



                                     Page 1


<PAGE>


                                                                 ATTACHMENT A TO
                                                       SECOND AMENDED SCHEDULE 3

Information in attachment omitted in its entirety and 
filed separately with the Commission pursuant to a 
confidential treatment request under Rule 24b-2 of the Commission.




                                     Page 2


