AMENDMENT

TO

EMPLOYMENT AGREEMENT

This Amendment dated as of May 4, 2005 (the “Amendment”) to the Employment
Agreement (the “Agreement”) dated as of July 25, 2000 by and between ANADIGICS,
Inc., a Delaware corporation (the “Corporation”), and Thomas Shields (the
“Executive”), is made and entered into by and between the Corporation and the
Executive. Unless otherwise defined herein, capitalized terms have the same
meanings as in the Agreement.

WHEREAS, the Corporation may from time to time consider transactions that could
result in a Change in Control of the Corporation;

WHEREAS, the Board of Directors of the Corporation has determined that it is
advisable and in the best interest of the Corporation to amend the Agreement to
provide for the payment of certain compensation to the Executive in the event of
the termination of his employment;

WHEREAS, the Corporation and the Executive desire to amend the Agreement to
reflect the intention of the Board of Directors as set forth herein.

NOW, THEREFORE, in consideration of the mutual premises and agreements set forth
herein, the Corporation and the Executive agree that the Agreement is hereby
amended as follows:

1.          Section 3 of the Agreement is amended by deleting such section in
its entirety and replacing it with the following:

“In the event you are terminated at any time by the Corporation without “Cause”
(as defined below) or in the event of a “Change in Control” (as defined in Annex
A hereto) which results in either the involuntary termination without Cause of
your employment with the Corporation or your voluntary resignation from the
Corporation due to a reduction in responsibilities and duties associated with
your position, or reduction in compensation (base salary, plus bonus at target)
without your prior express written consent, the Corporation agrees that
following such termination without Cause or such termination following a Change
in Control you shall receive (a) an amount equal to (1) the highest annualized
rate of your base salary in effect at any point during the twelve months
preceding the date of termination of employment under this Agreement, plus (2)
your bonus at a target of 110% of the highest annualized rate of your base
salary in effect at any point during the twelve months preceding the date of
termination of employment under this Agreement, plus (3) in the event of a
termination of employment following a Change in Control, 15.5% of any Change in
Control Amount (as defined below) received, or to which the Corporation or its
shareholders become legally entitled to receive, all such payments to be paid
within thirty (30) days from the date of termination of your employment under
this Agreement or, to the extent any portion of the Change in Control Amount to
which you are entitled has not been received by the Corporation or its
shareholders or to which the Corporation or its shareholders have not become
legally entitled to receive at such time, within thirty (30) days of the
Corporation’s or its shareholders’ actual receipt of any such amount; (b)
payment of the

 

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annual bonus (at 100% of target prorated for the number of complete months
worked in the year), to be paid within thirty (30) days from the date of
termination of your employment under this Agreement; (c) continuation of all
current medical and dental insurance benefits until the first to occur of one
year from the date of termination of employment under this Agreement or the
commencement of employment at another employer offering similar benefits; (d)
executive outplacement services for up to six months; and (e) immediate vesting
of all stock options previously or hereafter issued under the Corporation’s 1997
Long-Term Incentive and Share Award Plan for Employees and the 1995 Long-Term
Incentive and Share Award Plan for Officers, as the same may be amended from
time to time, to the extent such stock options have not vested as of such date,
which options shall continue to be exercisable, with respect to options granted
prior to October 31, 1998 for 90 days, and for options granted subsequent to
October 31, 1998, for twelve (12) months following the date of involuntary or
voluntary termination of employment under this Agreement as described above, but
not beyond the original term of the option. For purposes of this Section 3:

“Aggregate Proceeds” shall mean (x) the aggregate proceeds actually received by
the Corporation or its shareholders within twelve months of the date of a Change
in Control and (y) to the extent not yet actually received by the Corporation or
its shareholders pursuant to clause (x) hereof, such definitive amounts as the
Corporation or its shareholders are legally entitled to receive pursuant to a
written agreement; provided, that the closing of the transaction to which such
written agreement(s) relates occurs within twelve months of the date of a Change
in Control; and

“Change in Control Amount” shall mean (x) the lesser of (A) 4% of the Aggregate
Proceeds, from a single or multiple transactions, in connection with any Change
in Control or any sale, assignment, transfer or other disposition, not in the
ordinary course, of the stock, assets or business of the Corporation or (B)
$4,655,469, minus (y) $3,293,250; and

“Cause” shall mean (w) unauthorized use or disclosure of confidential
information of the Corporation in violation of Section 4(c) hereof; (x)
conviction of, or a plea of “guilty” or “no contest” to, a felony under the laws
of the United States of America or any state thereof; (y) embezzlement or
misappropriation of the assets of the Corporation; or (z) misconduct or gross
negligence in the performance of duties assigned to the executive employee under
this Agreement.

In determining the value of the non-cash total proceeds actually received by the
Corporation or its shareholders pursuant to this Section 3, (x) securities that
are traded on a United States national securities exchange or approved for
quotation on the Nasdaq National Market or any similar system of automated
dissemination of quotations of securities prices will be valued at 100% of the
average closing price or last sale price, as applicable, on the 10 trading days
prior to, but excluding the date of the Change in Control and (y) securities,
assets or property (other than cash and securities valued in accordance with
clause (x) hereof) will be valued in good faith by the Board of Directors of the
Corporation.”

 

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2.          This Amendment supplements and modifies the Agreement, and all of
the terms, conditions and agreements therein contained are, to the extent not
explicitly modified herein, hereby reaffirmed and agreed to and shall remain in
full force and effect except as herein modified.

 

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IN WITNESS WHEREOF, the Corporation has caused this Amendment to be executed by
its duly authorized officer and the Executive has hereunto set his hand, each as
of the day and year first written above.

ANADIGICS, INC.

By:      /s/ Bami Bastani                              
            Name:  Bami Bastani
            Title:   President and Chief
                        Executive Officer

EXECUTIVE:

By:      /s/ Thomas Shields                           
            Name:   Thomas Shields
            Title:    Senior Vice President and                          Chief
Financial Officer