Document:

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                                                                    EXHIBIT 10.1

                                            ***TEXT OMITTED AND FILED SEPARATELY
                                                CONFIDENTIAL TREATMENT REQUESTED
                             UNDER 17 C.F.R. SECTIONS 200.80(b)(4) AND 240.24b-2

================================================================================

                       WAFER SUPPLY AND SERVICES AGREEMENT

                                     among:

                              SPECIALTYSEMI, INC.,

                             a Delaware corporation;

                                       and

                             CONEXANT SYSTEMS, INC.,

                             a Delaware corporation

                          ----------------------------

                           Dated as of March 30, 2002

                          ----------------------------

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                               TABLE OF CONTENTS

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<S>    <C>                                                       <C>
1.      DEFINITIONS..............................................   1

        1.1    "AFFILIATE".......................................   1

        1.2    "BASIC PRICE".....................................   1

        1.3    "CAPACITY"........................................   1

        1.4    "CONEXANT SPIN-OFF"...............................   1

        1.5    "CONTRACT PRICE"..................................   2

        1.6    "CURRENT AVERAGE PROBE YIELD......................   2

        1.7    "DELIVERY NOTE"...................................   2

        1.8    "ENGINEERING WAFERS"..............................   2

        1.9    "FAB YIELD".......................................   2

        1.10   "LOT".............................................   2

        1.11   "MAXIMUM CAPACITY"................................   2

        1.12   "MOVE"............................................   2

        1.13   "MPD".............................................   2

        1.14   "NON-SPECIALTY WAFERS"............................   2

        1.15   "PARTY"...........................................   2

        1.16   "PIZZA MASK WAFERS"...............................   2

        1.17   "PHOTOMASKS"......................................   2

        1.18   "PLANNING YIELD ASSUMPTION".......................   2

        1.19   "PROBE SERVICES"..................................   3

        1.20   "PROBE YIELD".....................................   3

        1.21   "PROCESS FAILURE".................................   3

        1.22   "PRODUCTION WAFERS"...............................   3

        1.23   "PURCHASE ORDER"..................................   3

        1.24   "PURCHASE ORDER RELEASE...........................   3

        1.25   "QUALITY SPECIFICATIONS"..........................   3

        1.26   "RISK MATERIALS"..................................   3

        1.27   "SEGMENT".........................................   3

        1.28   "SPECIALTY WAFERS"................................   3

        1.29   "SPECIFICATIONS"..................................   3

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                                TABLE OF CONTENTS

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<S>    <C>                                                                  <C>
        1.30   "THIRD-PARTY REQUIREMENT.....................................  4

        1.31   "UNCOMMITTED AVAILABLE CAPACITY".............................  4

        1.32   "WAFERS".....................................................  4

        [...***...]

        1.34   "WAFER VOLUME COMMITMENT"...................................   4

        1.35   "WOPD"......................................................   4

        1.36   "WSPD"......................................................   4

2.      PURCHASE AND SUPPLY OBLIGATIONS.....................................  4

        2.1    CONEXANT PURCHASE OBLIGATIONS................................  4

        2.2    COMPANY SUPPLY OBLIGATIONS...................................  8

3.      WAFER PURCHASES.....................................................  9

        3.1    SCOPE........................................................  9

        3.2    FORECASTS.................................................... 10

        3.3    PURCHASE ORDERS; PURCHASE ORDER RELEASES; SPECIALTY WAFERS .. 10

        3.4    ACCEPTANCE AND ACKNOWLEDGEMENT............................... 11

        3.5    WAFER LOTS; EXPEDITED SERVICES............................... 12

        3.6    PIZZA MASK WAFERS............................................ 13

        3.7    CANCELLATION AND MODIFICATIONS TO ORDERS..................... 14

        3.8    MATERIALS.................................................... 14

        3.9    RISK MATERIALS............................................... 14

        3.10   NRE SERVICES................................................. 14

4.      PROBE SERVICES AND RE-PROBE SERVICES................................ 14

        4.1    SCOPE........................................................ 14

        4.2    PURCHASE ORDERS.............................................. 14

        4.3    ACKNOWLEDGEMENT AND ACCEPTANCE............................... 15

        4.4    CHANGES, CANCELLATION AND MODIFICATIONS TO ORDERS............ 15

        4.5    REMOVAL OF TEST EQUIPMENT FROM THE FAB....................... 15

5.      DELIVERY AND LOGISTICS.............................................. 15

        5.1    DELIVERY..................................................... 15

        5.2    STORAGE...................................................... 16

        [...***...]

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                                       ii     * CONFIDENTIAL TREATMENT REQUESTED

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                               TABLE OF CONTENTS

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6.      PRICING; [...***...] AND PAYMENTS........................ 16

        [...***...]

        6.3    COSTS.............................................  17

        6.4    TAXES.............................................  17

7.      TRACKING; REPORTING; AND AUDITS..........................  17

        7.1    WAFER TRACKING....................................  17

        7.2    REPORTING REQUIREMENTS............................  17

8.      WARRANTY AND DISCLAIMER..................................  17

        8.1    WAFER WARRANTY....................................  17

        8.2    PROCESS FAILURE...................................  18

        8.3    DISCLAIMERS.......................................  18

9.      INDEMNIFICATION..........................................  18

        9.1    CONEXANT INDEMNIFICATION OBLIGATIONS..............  18

        9.2    COMPANY INDEMNIFICATION OBLIGATIONS...............  18

        9.3    CONDITIONS........................................  19

        9.4    SOLE AND EXCLUSIVE REMEDY.........................  19

10.     CONFIDENTIALITY..........................................  19

11.     LIMITATIONS OF LIABILITY.................................  19

        [...***...]

        11.2   BASIS OF BARGAIN..................................  20

12.     TERM; TERMINATION........................................  20

        12.1   TERM..............................................  20

        12.2   TERMINATION.......................................  20

        12.3   EFFECT OF TERMINATION.............................  20

13.     GENERAL..................................................  21

        13.1   AGENCY............................................  21

        13.2   GOVERNING LAW; VENUE AND JURISDICTION.............  21

        13.3   DISPUTE RESOLUTION................................  21

        [...***...]

        13.5   THIRD-PARTY BENEFICIARIES.........................  23

        13.6   COMPLIANCE WITH LAW...............................  23
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                                TABLE OF CONTENTS

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        13.7   FORCE MAJEURE.....................................  23

        13.8   AMENDMENT; LATER AGREEMENT........................  23

        13.9   NOTICES...........................................  23

        13.10  ASSIGNMENT........................................  24

        13.11  WAIVER ...........................................  24

        13.12  SEVERABILITY......................................  24

        13.13  COUNTERPARTS AND FACSIMILE........................  24

        13.14  RULES OF CONSTRUCTION.............................  25

        13.15  SCHEDULES AND EXHIBITS............................  25

        13.16  ENTIRE AGREEMENT..................................  25

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                               TABLE OF CONTENTS

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EXHIBIT A      PRICING

EXHIBIT B      WAFER VOLUME COMMITMENTS

        SCHEDULE 1  FORECAST

        SCHEDULE 2  WAFER MOVES TABLE

EXHIBIT C      RULES OF CHANGE, OPERATION, AND RELEASE PROCEDURES

EXHIBIT D      NEWPORT BEACH FAB CAPACITY

EXHIBIT E      WAFER CYCLE TIMES

EXHIBIT F      QUALITY SPECIFICATIONS

EXHIBIT G      REPORTS

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                       WAFER SUPPLY AND SERVICES AGREEMENT

        THIS WAFER SUPPLY AND SERVICES AGREEMENT (the "SUPPLY AGREEMENT") is
entered into as of March 30, 2002 (the "EFFECTIVE DATE") by and between CONEXANT
SYSTEMS, INC., a Delaware corporation ("Conexant") and SPECIALTYSEMI, INC. a
Delaware corporation ("COMPANY").

                                    RECITALS

        A. Conexant, Company, and Carlyle Capital Investors, L.L.C. have entered
into a Contribution Agreement dated February 23, 2002 (the "CONTRIBUTION
AGREEMENT")pursuant to which Conexant contributed to Company the assets used to
provide specialty process foundry services and to manufacture semiconductor
wafers at a facility in Newport Beach, California (the "NEWPORT BEACH FAB").

        B. Conexant desires, on the terms and conditions of this Supply
Agreement, to purchase from Company semiconductor wafers and related foundry,
manufacturing, and probe services. Company is willing to supply such wafers and
services to Conexant on the terms and conditions of this Supply Agreement.

        NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Supply Agreement, the Parties agree as follows:

                                    AGREEMENT

1.      DEFINITIONS. Capitalized terms not expressly defined elsewhere in this
        Supply Agreement have the following meanings:

        1.1 "AFFILIATE" means any entity that at any time during the term of
this Supply Agreement controls, is controlled by, or is under common control
with a Party, where control means direct or indirect ownership of fifty percent
(50%) or more of the outstanding voting stock or other equity interests
ordinarily having voting rights.

        1.2 "BASIC PRICE" is defined in Exhibit A (Pricing).

        1.3 "CAPACITY" means, as of any date for any period, the number of MPD
capable of being completed at the Newport Beach Fab during such period, based on
available equipment, tools, and personnel, without additional capital spending,
equipment purchases, or hiring of personnel.

        1.4 "CONEXANT SPIN-OFF" means any entity that is a successor of any
portion of the business of Conexant resulting from a spin-off, sale, or
divestiture of such business, regardless of whether Conexant retains an equity
or ownership interest in such entity. Without limiting the foregoing, the
Parties agree and acknowledge that Mindspeed Technologies and Conexant's
wireless business (which is referred to within Conexant as "LeaderCo") are, or
upon the date of divestiture will be, Conexant Spin-offs.

                                       1
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        1.5 "CONTRACT PRICE" is defined in Exhibit A (Pricing).

        1.6 "CURRENT AVERAGE PROBE YIELD means, for a particular type of Wafer,
the Probe Yield established by averaging the Probe Yield for [...***...] Wafers
of such type in each of the three previous Segments.

        1.7 "DELIVERY NOTE" means the delivery instructions provided by Conexant
to Company for Wafers ordered by Conexant.

        1.8 "ENGINEERING WAFERS" means non-production Wafers manufactured by
Company for qualification or testing and may include Pizza Mask Wafers.

        1.9 "FAB YIELD" means the percentage deviation between a particular
number of Wafers for which fabrication is commenced at the Newport Beach Fab,
and the number of such Wafers for which fabrication is successfully completed,
irrespective of probe results.

        1.10 "LOT" means a single lot of Wafers that are processed together at
the Newport Beach Fab. Each Lot of Production Wafers, Pizza Mask Wafers (other
than Engineering Wafers), or Risk Materials shall consist of [...***...] Wafers.
Each Lot of Engineering Wafers shall consist of no less than [...***...] and no
more than [...***...] Wafers.

        1.11 "MAXIMUM CAPACITY" means, as of any date for any period, the
maximum number of MPD capable of being completed at the Newport Beach Fab during
such period based on available equipment, tools, and personnel, without
additional capital spending or equipment purchases. Maximum Capacity as of the
Effective Date is reflected in Exhibit D (Newport Beach Fab Capacity).

        1.12 "MOVE" means completion with respect to a single Lot of an
individual stage in any of the processes required in fabricating Wafers at the
Newport Beach Fab, as described in Exhibit B, Schedule 2.

        1.13   "MPD" means Moves per day at the Newport Beach Fab.

        1.14 "NON-SPECIALTY WAFERS" means all Wafers of all types other than
Specialty Wafers.

        1.15 "PARTY" means either Conexant or Company, as the context requires,
and "PARTIES" means Conexant and Company collectively.

        1.16 "PIZZA MASK WAFERS" means multiple device designs on a single
Wafer.

        1.17 "PHOTOMASKS" means precision photographic quartz or glass plates
containing microscopic images of integrated circuits for use as master images to
transfer circuit patterns onto semiconductor wafers during the fabrication of
integrated circuits and other semiconductor products.

        1.18 "PLANNING YIELD ASSUMPTION" means, for any given type of Wafer, the
expected percentage deviation between the number of Wafers specified for
delivery in a Purchase Order

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and the total number of Wafers actually delivered, as set forth in Exhibit B,
Schedule 2 as such exhibit may be updated from time to time upon written notice
from Company.

        1.19 "PROBE SERVICES" means electrical testing of individual
semiconductor wafers on a substrate.

        1.20 "PROBE YIELD" means the percentage deviation between a particular
number of Wafers for which probing is conducted at the Newport Beach Fab, and
the number of such Wafers that probe successfully.

        1.21 "PROCESS FAILURE" means a fault or flaw in the performance of any
process within the fabrication operation that is not due to designs,
specifications, Photomasks, or instructions provided by Conexant.

        1.22 "PRODUCTION WAFERS" means Wafers manufactured by Company at the
Newport Beach Fab after successful qualification and approval for mass
production.

        1.23 "PURCHASE ORDER" means a written [...***...] order for the purchase
of a specified quantity of Wafers or Probe Services submitted by Conexant to
Company.

        1.24 "PURCHASE ORDER RELEASE" means a written release issued by Conexant
authorizing Company to commence processing of the Wafers under a Purchase Order.

        1.25 "QUALITY SPECIFICATIONS" means the Wafer quality standards and
criteria set forth in Exhibit F (Quality Specifications), as may they be
modified by written agreement of the Parties from time to time.

        1.26 "RISK MATERIALS" means Wafers specifically identified by Conexant
in a Purchase Order as "Risk Materials" that are to be manufactured by Company
pursuant to Conexant's Specifications, but for which compliance with the Quality
Specifications is specifically waived. "Risk Materials" may include the
following: unverified mask sets, unverified process changes, no supporting
qualification data, and known design rule violations.

        1.27 "SEGMENT" means any one of the following [...***...] periods:
[...***...].

        1.28   "SPECIALTY WAFERS" means [...***...].

        1.29 "SPECIFICATIONS" means the technical specifications for the Wafers
in effect at the Newport Beach Fab immediately prior to the Effective Date, as
they may be modified from time to time by written agreement of the Parties, or
if such technical specifications do not exist as of the Effective Date, then
those technical specifications mutually agreed to in writing by the Parties for
such Wafers, as they may be modified from time to time written agreement of the
Parties.

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        1.30 "THIRD-PARTY REQUIREMENT" means any oral or written commitment from
a customer (other than Conexant or a Conexant Spin-Off or a Conexant Affiliate)
to engage Company to manufacture Wafers or provide related services for such
customer at the Newport Beach Fab, which commitment is reasonably likely to
result in a binding obligation.

        1.31 "UNCOMMITTED AVAILABLE CAPACITY" means, at any given time, the
Capacity remaining at the Newport Beach Fab after excluding all Capacity
necessary to fulfill the Company's commitments under this Supply Agreement and
Third-Party Requirements.

        1.32 "WAFERS" means semiconductor wafers to be processed and prepared
for shipping by Company at the Newport Beach Fab including Engineering Wafers,
Production Wafers, Pizza Mask Wafers, and Risk Materials.

        1.33   [...***...]

        1.34 "WAFER VOLUME COMMITMENT" is defined in Section 2.1(a) (Volume
Commitments).

        1.35 "WOPD" means a number of Wafers for which the fabrication process
is completed at the Newport Beach Fab in a single day.

        1.36 "WSPD" means a number of Wafers for which the fabrication process
is commenced at the Newport Beach Fab in a single day.

2.      PURCHASE AND SUPPLY OBLIGATIONS.

        2.1 CONEXANT PURCHASE OBLIGATIONS.

            (a) VOLUME COMMITMENTS. Subject to the terms and conditions of this
Supply Agreement and in accordance with the procedures set forth in Section 3.3
(Purchase Orders; Purchase Order Releases; Specialty Wafers), Conexant will
submit Purchase Orders to Company for the manufacture of, and will purchase
pursuant to such Purchase Orders, Wafers in volumes sufficient to meet the
minimum MPD purchase commitments set forth in Exhibit B, Schedule 1 (the "WAFER
VOLUME COMMITMENTS"), at the prices set forth below.

            (b) SEGMENTS 1 THROUGH 6. During Segments 1 through 6:

                (i) Conexant shall meet the Wafer Volume Commitment
corresponding to the current Period set forth in Exhibit B, Schedule 1.

                (ii) For any of Segments 1 through 6 in which the number of
Wafers purchased by Conexant at the end of the Segment is less than the greater
of (i) the Wafers ordered in the Purchase Order for such Segment described in
Section 3.3(a) and (ii) the Wafer Volume Commitment for such Segment, in
addition to the amounts paid for Wafers purchased, Conexant shall pay the
following in respect of the shortfall in the Wafers purchased compared to the
greater of (i) the Wafers ordered in the Purchase Order for such Segment
described in Section 3.3(a) and (ii) the Wafer Volume Commitment (the
"Shortfall"):

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                             (1)    [...***...]

                             (2)    [...***...]

                             (3)    [...***...]

[...***...]

[...***...]

                (iii) If, in any of Segments 1 through 6, Conexant fails to meet
the Wafer Volume Commitment or to purchase Wafers ordered in the Purchase Order
for such Segment described in Section 3.3(a), and as a result pays any amounts
pursuant to Section 2.1(b)(ii), and, prior to the end of Segment 6, purchases
Wafers in excess of the Wafer Volume Commitment for the Working Segment, then
Conexant shall be required to pay [...***...]. Conexant will pay the
[...***...], or other price specified in this Supply Agreement, as appropriate,
for any additional Wafers purchased in the Working Segment thereafter.

            (c) SEGMENTS 7 THROUGH 18. During Segments 7 through 18:

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                (i) Conexant shall meet the Wafer Volume Commitment for such
period set forth in Exhibit B, Schedule 1.

                (ii) In the event that the number of Wafers purchased under the
Purchase Order(s) for any Working Segment is less than the greater of (i) the
Wafers ordered in the Purchase Order for such Segment described in Section
3.3(a) and (ii) the Wafer Volume Commitment for the Working Segment, Conexant
shall pay to Company, [...***...].

            (d) REQUIREMENTS IN EXCESS OF THE WAFER VOLUME COMMITMENT.

                (i) NON-SPECIALTY WAFERS. During Segments 1 through 24, except
to the extent that it has any preexisting obligations as of the Effective Date
to purchase Non-Specialty Wafers from third parties, [...***...].

                (ii) SPECIALTY WAFERS. During Segments 1 through 12, Conexant
may submit its requirements for Specialty Wafers in excess of the Wafer Volume
Commitment to Company, which, provided that it has sufficient Uncommitted
Available Capacity, shall be obligated to produce such Wafers. Conexant shall
purchase such Wafers at [...***...].

            (e) SURGE CAPACITY. At any time after Conexant's submission of a
Purchase Order for any Working Segment, Conexant may request to increase the
number of Wafers to be purchased in such Working Segment (an "INCREASE NOTICE").

                (i) SEGMENTS 1 THROUGH 18. During Segments 1 through 18, the
following terms will apply:

                    (1) COMMITMENT SURGE. If Conexant submits an Increase Notice
with at least [...***...] advance notice for additional Wafers in order to meet
a Wafer Volume Commitment ("COMMITMENT SURGE WAFERS"), Company will fabricate
and sell to Conexant a number of Commitment Surge Wafers equal to [...***...]

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[...***...]. Company will use commercially reasonable efforts to deliver the
Commitment Surge Wafers [...***...]. Conexant will pay [...***...] for all
Commitment Surge Wafers.

                    (2) BEYOND COMMITMENT SURGE. If Conexant submits an Increase
Notice with at least [...***...] advance notice for additional Wafers
[...***...], Company will use commercially reasonable efforts to fabricate and
sell to Conexant the number of Additional Wafers ordered by Conexant. Conexant
will pay [...***...] for all Additional Wafers.

                (ii) AFTER SEGMENT 18. After Segment 18, at any time after
Conexant's submission of a Purchase Order for any Working Segment, Conexant may
submit an Increase Notice to Company. If Company has Uncommitted Available
Capacity, Company will fabricate and sell to Conexant such additional Wafers, or
as many as can be fabricated in light of the Uncommitted Available Capacity.
Conexant will pay [...***...] for all such additional Wafers purchased after
Segment 18.

            (f) PURCHASES FOR CERTAIN ENTITIES. Company agrees that Conexant, as
agent, may place orders for any Conexant Spin-Off or Conexant Affiliate,
[...***...]. The Parties acknowledge and agree that at any time after a Conexant
Spin-off commences operations as a separate legal entity, (i) Conexant may
partition the Wafer Volume Commitments between Conexant and Conexant Spin-offs,
assuring that the total volume meets the total Wafer Volume Commitment; (ii)
Conexant and Conexant Spin-offs may [...***...], provided, however, [...***...];
and (iii) each Conexant Spin-off (a "PARTICIPATING Spin-off") may enter into a
separate agreement with Company containing all of the terms and conditions of
this Supply Agreement, in which case the Participating Spin-off will order
Wafers directly from Company. Company will have the right to review the
allocation of Wafer Volume Commitments, [...***...], and other rights hereunder
partitioned and assigned to each Participating Spin-off, and Conexant will work
in good faith with Company to resolve any reasonable objections that the Company
may have to such allocation. If Conexant and Participating Spin-offs partition
Wafer Volume Commitments as set forth above, the determination of whether the
Wafer Volume Commitment is met will be determined on a collective basis, and no
additional payments to meet the Wafer Volume Commitment will be due to Company
if the total number of Wafers purchased by Conexant and Participating Spin-offs
is sufficient to meet or exceed the applicable Wafer Volume Commitment. Conexant
will remain responsible to Company for satisfaction of Wafer purchase and
payment obligations hereunder, regardless of whether it is Conexant itself or a
Participating Spin-off that fails to satisfy any such obligations. In the event
that a third party acquires any Participating Spin-off, its business, or all or
substantially all of its assets, then such third party may only assume the
rights of Participating Spin-offs hereunder with respect to Wafer types of such
Participating Spin-off that have been manufactured or are under development by
the Newport Beach Fab at the time of such acquisition.

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            (g) COOPERATION. Conexant shall cooperate with Company in
furtherance of the purposes hereof by timely furnishing all design information,
Photomasks, specifications, intellectual property, and other items and
information needed to fabricate the Wafers ordered by Conexant, and by providing
reasonable technical advice and assistance in such efforts.

            (h) PAYMENT; REMEDY. All determinations of whether Wafer Volume
Commitments have been met during any Working Segment shall be determined at the
end of such Working Segment, and all amounts to be paid in respect of portions
of the Wafer Volume Commitment not purchased in accordance with this Section
will be tracked monthly, and reconciled and paid at the end of each Working
Segment. Conexant's payment of the foregoing amounts shall be [...***...].

        2.2 COMPANY SUPPLY OBLIGATIONS.

            (a) COMMITMENT; REQUESTS FOR INCREASED CAPACITY. Company shall be
able to provide the Capacity to satisfy the Wafer Volume Commitments set forth
in Exhibit B, Schedule 1 during each Segment of the term of this Supply
Agreement, and will accept and fulfill all Purchase Orders that are submitted
pursuant to the [...***...] Purchase Order requirements set forth in Section 3.3
(Purchase Orders; Purchase Order Releases; Specialty Wafers) up to the
applicable Wafer Volume Commitments. In addition, upon Conexant's request,
Company will increase (and maintain for a period of time specified by Conexant)
Capacity up to the Maximum Capacity of the Newport Beach Fab, provided that (i)
Company will have no less than [...***...] Segments in which to accomplish such
increase; (ii) in no event will Company be required to increase Capacity by an
increment equivalent to more than [...***...]; and (iii) at the time of its
request, Conexant submits binding Purchase Orders for a total number of Wafers
sufficient to utilize the requested increase in Capacity for the period of the
desired increase.

            (b) NOTICE REQUIREMENTS. If at any time Company believes or becomes
aware that it would be unable to satisfy the Wafer requirements of Conexant
contained in the latest Order Forecast, then Company will promptly notify
Conexant in writing.

            (c) WAFER PROCESSES. This Supply Agreement applies to all processes
currently available or in development at the Newport Beach Fab. Future processes
that are developed by the Company may be added to this Supply Agreement by
mutual consent. Subject to the restrictions in this Section 2.2(c), Company may
terminate the use of a Wafer process at the Newport Beach Fab. At least
[...***...] prior to the date of the discontinuance of any process with respect
to any Wafers, Company shall provide Conexant with written notice of its intent
to terminate such Wafer process and shall cooperate with Conexant on a
transition plan with respect to Conexant's supply of Wafers. If the projected or
actual volume on any process decreases to less than the equivalent of
[...***...], Company may phase out such process without such [...***...] notice,
provided that Conexant and Company will in such case cooperate to phase out such
process in a timely manner through an end-of-life buy. Company will perform the
transition in accordance with the plan and will use commercially reasonable
efforts to ensure a smooth transition.

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            (d) [...***...]

            (e) SUPPLY INTERRUPTIONS. If at any time Company experiences a
Material Interruption (as defined below), Conexant's Wafer Volume Commitments
shall be reduced by the number of Wafers Company is unable to supply for the
actual duration of such Material Interruption, provided, however, that if such
Material Interruption results from Conexant's failure to provide any services
that Conexant is obligated to provide [...***...], then Conexant's Wafer Volume
Commitment shall not be reduced as a result of such Material Interruption. If an
unintended interruption in Company's ability to fulfill its supply obligations
occurs that is not a Material Interruption, Conexant shall remain obligated to
satisfy its obligations hereunder to purchase Wafers, provided, that if, due to
such interruption, Company is unable to deliver a number of Wafers ordered to
fulfill a portion of a Wafer Volume Commitment prior to the end of the Segment,
then Conexant will be excused from that portion of the Wafer Volume Commitment
for that Segment, and such portion will be rolled over to be fulfilled by the
end of the following Segment. This provision shall not limit any other rights or
remedies Conexant or Company may have for a breach of this Supply Agreement or
otherwise, and nothing in this provision is intended to supersede, restrict, or
otherwise limit either party's rights under Section 13.7 (Force Majeure). For
purposes of this Section, "Material Interruption" means an unintended
interruption in Company's ability to produce Wafers that (i) endures for more
than a [...***...], and (ii) causes a reduction in Capacity of [...***...].

3.      WAFER PURCHASES.

        3.1 SCOPE. on receipt of an applicable Purchase Order Release (as
described in Section 3.3(b) (Purchase Order Releases) below), Company shall
produce Wafers and provide Probe Services for Conexant. Wafers may include
Production Wafers, Engineering Wafers, and Risk Materials from any semiconductor
wafer process in production, or released to production, at the Newport Beach Fab
on or after the Effective Date. For new Wafers or processes requested by

                                       9
                                              * CONFIDENTIAL TREATMENT REQUESTED

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Conexant, Conexant will provide Company with the documentation substantially
similar to the document(s) set forth in Exhibit C (Rules of Change, Operation
and Release Procedures), as applicable to the requested process. Both Parties
agree to cooperate to provide all necessary information as described in Exhibit
C.

        3.2 FORECASTS. On or about the last day of each calendar month during
the term of this Supply Agreement, Conexant will provide to Company a rolling
forecast, covering a minimum period of [...***...], of Conexant's expected order
volumes for Wafers in the coming [...***...] (the "ORDER FORECAST"). The Order
Forecasts are for planning purposes only and will not bind Conexant or the
Company in any respect. No deviation of actual volumes from the forecasted
volumes will relieve Conexant or Company of their respective responsibilities
and obligations under this Supply Agreement or affect the pricing established
under this Supply Agreement. Subject to the requirements of Section 2.1
(Conexant Purchase Obligations), Conexant may change or update the forecasts
delivered hereunder at any time upon notice to Company.

        3.3 PURCHASE ORDERS; PURCHASE ORDER RELEASES; SPECIALTY WAFERS.

            (a) PURCHASE ORDER. Not later than [...***...] prior to the first
business day of each Segment during the term of this Supply Agreement (other
than Segment 1), Conexant shall submit to Company a written Purchase Order
setting forth the specific volume and mix of Wafers [...***...] it intends to
purchase under this Supply Agreement during the following Segment (the "WORKING
SEGMENT"), expressed as total WSPD per type of Wafer. Conexant shall not load
the Newport Beach Fab by a number of WSPD in each day of the Working Segment set
forth in such Purchase Order that deviates by more than [...***...] The Purchase
Order for Segment 1 will be submitted to Company within [...***...] after the
Effective Date.

            (b) PURCHASE ORDER RELEASES Conexant will submit [...***...]
Purchase Order Releases against outstanding Purchase Orders, [...***...]. Each
Purchase Order Release for Wafers will specify the applicable Purchase Order,
Wafer part number and revision level, quantity, additional component parts
required by Conexant, price, delivery date, ship-to address, and other
applicable information as determined by Conexant. Purchase Order Releases shall
not deviate from the volumes and mixes specified for the corresponding period of
time in the applicable Purchase Order, except that Conexant may [...***...].
Notwithstanding the receipt of a Purchase Order, Company will not commence
manufacturing of the Wafers under a Purchase Order until Conexant has issued a
Purchase Order Release.

            (c) [...***...]

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                                              * CONFIDENTIAL TREATMENT REQUESTED

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[...***...]

                (i) [...***...]

                (ii) [...***...]

                (iii) [...***...]

        3.4 ACCEPTANCE AND ACKNOWLEDGEMENT All Purchase Orders submitted at
least [...***...] prior to the start of the Working Segment for Wafers shall be
accepted by Company up to the Wafer Volume Commitment and as specified in
Section 2.1(d) (Requirements in Excess of the Wafer Volume Commitment), and may
be accepted by Company in all other cases. Subject to the terms of this Supply
Agreement, once Company accepts a Purchase Order, it will be obligated to
produce and deliver the Wafers in the volumes specified in the Purchase Order
(subject to the applicable Planning Yield Assumption), and Conexant will be
obligated to purchase such Wafers in the volumes specified in the Purchase
Order. Within [...***...] after receipt of each Purchase Order or Purchase Order
Release or, if received on a non-business day or on the day prior to a
non-business day, within [...***...], Company will acknowledge such Purchase
Order or Purchase Order Release in writing by either fax or e-mail notice to
Conexant's purchasing agent identified on the face of the Purchase Order or
Purchase Order Release. Such acknowledgement will include Company's projected
delivery date for the order; provided that, in establishing such delivery date,
Company shall use reasonable efforts to comply with the delivery dates specified
in Conexant's Purchase Order Release. The Wafer process cycle times set forth in
Exhibit E (Wafer Cycle Times) shall be updated each Segment. If at any time
during the production of such Wafers Company believes or becomes aware that the
delivery may be delayed by more than [...***...], Company shall provide Conexant
with written notice of such change in the delivery schedule and the quantity of
Wafers affected. Such report shall be referred to as an "EXCEPTION REPORT" and
any Wafer Lots not specifically identified in an Exception Report shall be
delivered by Company no later than the delivery date specified in the Purchase
Order Release. Purchase Orders or Purchase Order Releases not acknowledged or
rejected by Company within such time will be deemed accepted by Company.

        3.5 WAFER LOTS; EXPEDITED SERVICES. Unless otherwise agreed to in
writing by the Parties, Production Wafers shall be ordered by Conexant and
delivered by Company in Lots of

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                                              * CONFIDENTIAL TREATMENT REQUESTED

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[...***...] (subject to the applicable Planning Yield Assumptions) and
Engineering Wafers shall be ordered by Conexant and delivered by Company in Lots
of [...***...] (subject to the applicable Planning Yield Assumptions). At
Conexant's request, Company will use commercially reasonable efforts to process
Production Wafer Lots, Engineering Wafer Lots, and Risk Materials on an
expedited basis; provided that Company shall have no liability for failure to
actually provide priority processing. Company shall provide up to the Allowable
Number (as defined below) of priority Lots to be processed at any one time
[...***...], and if the number of expedited Lots requested by Conexant and
provided on an expedited basis by Company exceeds the Allowable Number of Lots
in process at any given time, [...***...]:

[...***...]

[...***...]

        The "ALLOWABLE NUMBER" shall be determined as follows: [...***...]

        3.6 PIZZA MASK WAFERS. Conexant may submit Purchase Orders and Purchase
Order Releases for Pizza Mask Wafers, and Company shall fulfill such orders to
the extent required to fill such orders under Section 2.2 (Company Supply
Obligations), provided that (i) the only testing of Pizza Mask Wafers required
to be performed by Company will be [...***...]; and (ii) Company will deliver
Pizza Mask Wafers in wafer form. The price of the Pizza Mask Wafer will be
[...***...].

        3.7 CANCELLATION AND MODIFICATIONS TO ORDERS. Conexant may modify or
reschedule a Purchase Order Release (in whole or in part) as set forth in this
Section 3.7; provided that Conexant meets its Wafer Volume Commitments.

            (a) CANCELLATION BEFORE PROCESS START Except as set forth in Section
3.3(b) (Purchase Order Releases), for each Purchase Order Release for which
processing of the Wafers has not yet begun, Conexant may cancel or modify a
Purchase Order Release (in whole or in part) [...***...] by delivering to
Company a written notice of cancellation or modification, provided that Conexant
replaces within a reasonable time any Moves reduced or eliminated through such
cancellation or modification with the same number of Moves with respect to
replacement products.

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                                              * CONFIDENTIAL TREATMENT REQUESTED

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            (b) [...***...]

            (c) CANCELLATION AFTER PROCESS START If Conexant cancels a Purchase
Order Release (in whole or in part) after the date the processing of such Wafers
has been started, then either, (i) if so instructed by Conexant, Company will
not complete the cancelled Wafers and will deliver the incomplete Wafers to a
location designated by Conexant, [...***...], and Conexant will pay the
[...***...], as defined below; or (ii) unless otherwise instructed pursuant to
clause (i) of this Section, complete the cancelled Wafers and hold the resulting
Wafers in finished goods inventory where they will be stored in accordance with
Section 5.2 (Storage), [...***...] and Conexant will pay the applicable Price
for completed Wafers. The "[...***...]" means [...***...].

            (d) REWORK REQUESTS If for any reason other than a Process Failure
it becomes necessary to, or Conexant otherwise requests Company to, modify any
part of the fabrication process with respect to Wafers for which a Purchase
Order has already been accepted or for which the fabrication process has already
started, Company may agree to such changes if technically feasible and if
Company has available Capacity, in which case Conexant will be obligated to pay
the applicable price for rework services set forth in Exhibit A (Pricing). In
the event that Company does not accept such changes, then Conexant may cancel
the Purchase Order Release in question, subject to this Section 3.7.

        3.8 MATERIALS. Company shall be responsible for procuring all materials
required to manufacture the quantity of Wafers ordered by Conexant. Conexant
shall be responsible for obtaining and furnishing to Company all Photomasks, or
any other products with similar functional characteristics, required to
manufacture or support the Wafers ordered by Conexant. Company shall be
responsible for repair or replacement of any of Conexant's Photomasks damaged
while in Company's possession.

        3.9 RISK MATERIALS. At Conexant's request and subject to Section 2.1
(Conexant Purchase Obligations) and to an applicable Purchase Order, Company
shall process and provide Risk Materials to Conexant. With all Purchase Orders
for Risk Materials, Conexant shall provide a written statement setting forth the
risk factors or any special circumstances related to the Risk Materials and
specifying the quantity of Risk Materials to be provided. Company's
acknowledgement of a Purchase Order for Risk Materials shall be deemed an
acknowledgement of such risks or circumstances.

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                                              * CONFIDENTIAL TREATMENT REQUESTED

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        3.10 NRE SERVICES At Conexant's request, Company shall negotiate to
provide non-recurring engineering services for new Wafers, provided that the
Parties reach agreement concerning the terms and conditions of provision of such
services. The Parties shall negotiate in good faith the terms and conditions and
any applicable costs associated with such engineering services.

4.      PROBE SERVICES AND RE-PROBE SERVICES.

        4.1 SCOPE. Company shall provide Probe Services for all Wafers produced
for Conexant by the Company that are included in the Wafer Volume Commitment, at
[...***...]. For other Wafers provided by Company, the Parties will agree upon
whether [...***...] will include Probe Services. Company may also provide Probe
Services for Wafers from other sources provided by Conexant, subject to
agreement by the Parties on terms and conditions for such Probe Services. Probe
Services to be provided under this Supply Agreement shall be limited
[...***...]. Probe Services may be provided using testers [...***...], as
specified by Conexant in the applicable Purchase Order. Conexant will provide
all of the documentation and test parameters necessary to complete Probe
Services prior to issuing a Purchase Order Release.

        4.2 PURCHASE ORDERS. Subject to the agreement of the Parties on the
terms for Probe Services (other than for Wafers produced by Company), Conexant
will submit [...***...] Purchase Orders to Company for Conexant's expected
requirements for Probe Services. Conexant will then submit [...***...] Purchase
Order Releases to such Purchase Orders. Notwithstanding the receipt of a
Purchase Order, Company will not commence performance of Probe Services under a
Purchase Order until Conexant has issued a Purchase Order Release. Each Purchase
Order Release for Probe Services will specify the applicable Purchase Order,
applicable wafers provided by Conexant, testers to be used, price, delivery
date, ship-to address, and other applicable information as determined by
Conexant.

        4.3 ACKNOWLEDGEMENT AND ACCEPTANCE. Within [...***...] after receipt of
each Purchase Order or Purchase Order Release or, if received on a non-business
day or on the day prior to a non-business day, within [...***...], Company will
acknowledge such Purchase Order or Purchase Order Release in writing by either
fax or e-mail notice to Conexant's purchasing agent identified on the face of
the Purchase Order or Purchase Order Release. Purchase Orders or Purchase Order
Releases not acknowledged or rejected by Company within such time will be deemed
accepted by Company.

        4.4 CHANGES, CANCELLATION AND MODIFICATIONS TO ORDERS.

            (a) CHANGES. Conexant may submit documentation changes for Probe
        Services at any time. In the event such change requires a substantial
        change in the scope of work, Company shall promptly notify Conexant in
        writing as to whether Company accepts such change, and, if accepted, of
        the impact of the change on cost and delivery prior to implementing the
        change. Upon receipt of Conexant's written approval of the change,
        Company shall adjust the price and delivery for the Probe Services to be
        performed and implement the requested change.

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                                              * CONFIDENTIAL TREATMENT REQUESTED

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            (b) CANCELLATIONS. For each Purchase Order Release for which Probe
Services has not yet been started, Conexant may cancel or modify a Purchase
Order Release (in whole or in part)  [...***...] by delivering to Company a
written notice of cancellation or modifications.

            (c) [...***...]

            (d) HOLDS AND CANCELLATIONS AFTER PROCESS START. Conexant may put on
hold any Probe Services to be provided under a Purchase Order Release for up to
[...***...] Lots at a time; provided that no Lot will remain on hold for longer
than [...***...], after which the Probe Services shall be deemed cancelled and
Company shall, [...***...], invoice Conexant for the Probe Services actually
performed by Company prior to date of the hold. If Conexant cancels a Purchase
Order Release (in whole or in part) after the date the Probe Services have been
started, then Company will either, at Conexant's sole discretion (i) not
complete the cancelled Probe Services and hold the wafers in a processing
location designated by Conexant; or (ii) complete the cancelled Probe Services.
[...***...].

            (e) EXCESS SERVICE REQUIREMENTS. If Conexant's demand exceeds the
Company's Probe Services capacity in Newport Beach, Conexant shall offer any
available Probe Services capacity to Company at a Conexant facility and assure
this capacity is offered [...***...].

        4.5 REMOVAL OF TEST EQUIPMENT FROM THE FAB. The Parties acknowledge that
certain probe and test equipment owned by Conexant is located in the Newport
Beach Fab, and that Company is entitled to use and access such equipment
pursuant to the [...***...] between Conexant and Company, dated March 12, 2002.
Conexant may not remove any of the test equipment from the Probe floor
[...***...] Conexant may deliver a written notice of removal to Company with
respect to any test device owned by it, and may remove such test device after
[...***...] following receipt by Company of such notice. [...***...]

5.      DELIVERY AND LOGISTICS.

        5.1 DELIVERY. All Wafers delivered to Conexant shall be delivered F.O.B.
the Company's facility at the Newport Beach Fab, as requested in the applicable
Delivery Note. Title and risk of loss shall pass from Company to Conexant upon
delivery, which shall be deemed made upon transfer of possession to the shipping
carrier or to storage if not shipped immediately. Conexant shall be responsible
for all freight, handling and insurance charges subsequent to such

                                       15
                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

delivery. Except in accordance with the applicable delivery terms set forth in
this Supply Agreement, Company shall not have any liability in connection with
shipment, nor shall the shipping carrier be deemed to be an agent of Company.

        5.2 STORAGE. Following delivery to Conexant, Company shall provide
storage of up to [...***...] Lots of completed Wafers [...***...], provided that
no Lot shall remain in such storage for longer than [...***...] days.

        5.3 [...***...]

6.      PRICING; [...***...]; AND PAYMENTS.

            (a) WAFERS. Company will invoice Conexant for all Wafers upon
[...***...], at the applicable Wafer price calculated pursuant to Exhibit A
(Pricing) in effect on the date of the invoice, [...***...]. For Lots of
Engineering Wafers, Company will invoice Conexant at the [...***...] for all
Moves completed with respect to such Engineering Wafers during such [...***...],
and upon [...***...]. Each invoice submitted to Company shall specifically set
forth the [...***...]. In Segments 1 through 6, Conexant shall pay any amounts
due on such invoices within [...***...] of the receipt of the invoice and in all
subsequent Segments such payments shall be made within [...***...] of receipt of
the invoice. Notwithstanding any other provision hereof, neither Party may
offset any amounts owed by such Party to the other Party against any amounts
from such other Party, without such other Party's express written agreement to
such offset in each case.

            (b) PROBE SERVICES AND RE-PROBE SERVICES. Company will invoice
Conexant for Probe Services and any other services specified in this Supply
Agreement on a [...***...] basis. Pricing for such services shall be in
accordance with Exhibit A (Pricing). All invoice costs include, without
limitation, the labor for services actually performed, materials, material
burden, and costs associated with any changes approved in writing by Conexant

        6.2 [...***...]

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                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

        6.3 COSTS. Except as otherwise provided herein or agreed to in writing
by the Parties, each Party will be solely responsible for the costs and expenses
it incurs in performing its obligations under this Supply Agreement.

        6.4 TAXES. Conexant will be responsible for payment of any and all taxes
or related governmental charges ("TAXES") imposed on or arising from Conexant's
purchase of Wafers or Probe Services under this Supply Agreement, excluding any
Taxes on the net income or net worth of Company, provided that such taxes are
specifically identified by Company as a separate line item on Company's invoices
provided pursuant to Section 6.1 (Pricing and Invoices). Company will provide
Conexant with copies of official receipts for the payment of any such Taxes, and
any other information and documents Conexant may reasonably request in order to
verify the payment of such amounts to the appropriate governmental entity.

7.      TRACKING; REPORTING; AND AUDITS.

        7.1 WAFER TRACKING. All Wafers manufactured and delivered by Company to
Conexant shall have backward and forward trace ability sufficient to enable
Company to identify (i) the processes and materials used in the manufacture of
such Wafers; (ii) the batches or lots of such materials; and (iii) other Wafers
in the same or sequential lots. Such information shall be provided to Conexant,
upon Conexant's request.

        7.2 REPORTING REQUIREMENTS. Company shall provide Conexant with the
reports specified in Exhibit G (Reports) in accordance with frequency or
schedule set forth therein. All such reports shall be in writing and provided to
Conexant in the form (e.g., electronic form) specified in Exhibit G or otherwise
mutually agreed to in writing by the Parties.

8.      WARRANTY AND DISCLAIMER.

        8.1 WAFER WARRANTY. For a period of [...***...] from the date of
delivery (the "Wafer Warranty Period"), Company warrants that the Wafers, other
than Risk Materials, delivered hereunder will conform to the applicable
Specifications, will be manufactured in accordance with the Quality Standards,
and will be free from defects in material, manufacturing and workmanship. If,
during the Wafer Warranty Period, a breach of the warranty is discovered in the
Wafers, then Company shall promptly begin production to replace the defective
Wafer and

                                       17
<PAGE>

work with Conexant on a timely basis to determine the cause of such defect and
appropriate corrective measures. For the avoidance of doubt, a breach of the
foregoing warranty will not give rise to any termination provision under Section
12 (Term; Termination) provided that Company provides the foregoing express
remedy.

        8.2 PROCESS FAILURE. In the event that, [...***...], then Company will
notify Conexant and will dispose of such Lot and/or start a new Lot in
accordance with Conexant's directions.

        8.3 DISCLAIMERS. EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN THIS
SUPPLY AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATIONS OR WARRANTIES, EXPRESS
OR IMPLIED OR OTHERWISE, IN CONNECTION WITH THIS SUPPLY AGREEMENT OR ANY WAFERS
OR SERVICES PROVIDED UNDER THIS SUPPLY AGREEMENT, AND EACH PARTY SPECIFICALLY
DISCLAIMS THE IMPLIED WARRANTIES AND CONDITIONS OF MERCHANTABILITY, FITNESS FOR
PARTICULAR PURPOSE AND NONINFRINGEMENT.

9.      INDEMNIFICATION.

        9.1 CONEXANT Indemnification Obligations. Conexant agrees to indemnify,
hold harmless and defend at its own expense any liability or cost associated
with any claim, suit, or action (collectively, "CLAIMS") asserted or brought
against Company, its Affiliates and its subsidiaries, and their officers,
directors, employees, agents, and representatives by a third party to the extent
that such Claim alleges that Conexant's specifications or designs used in the
production of Wafers infringe on [...***...] (a "CONEXANT INFRINGEMENT CLAIM").
Conexant will pay such damages awarded against Company by a court of competent
jurisdiction, or agreed to in a monetary settlement of any such Claim by
Conexant, to the extent that such damages are directly attributable to a
Conexant Infringement Claim. Conexant's indemnification obligation will not
apply to Conexant Infringement Claims to the extent they result from or are
attributable to (a) any modifications, combinations, or improvements made to the
design or specification as furnished to Company by Conexant that are not agreed
to by Conexant; or (b) use of the design or specification by Company for any
purpose other than providing Wafers or Probe Services to Conexant.

        9.2 COMPANY INDEMNIFICATION OBLIGATIONS. Company agrees to indemnify,
hold harmless and defend at its own expense any liability or cost associated
with any claim, suit, or action (collectively, "CLAIMS") asserted or brought
against Conexant, a Conexant Spin-off, or any of their respective Affiliates and
subsidiaries, and their officers, directors, employees, agents, and
representatives by a third party to the extent that such Claim alleges that
Company's use of technology, equipment, processes, or methods to manufacture the
Wafers or provide the Probe Services infringes upon [...***...] (a "COMPANY
INFRINGEMENT CLAIM"). Company will pay such damages awarded against Conexant by
a court of competent jurisdiction, or agreed to in a monetary settlement of any
such Claim by

                                       18
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Company, to the extent that such damages are directly attributable to a Company
Infringement Claim. Company's indemnification obligation hereunder will not
apply to Company Infringement Claims alleging infringement by any technology,
equipment, processes, or methods that were (a) in use by Company upon the
Effective Date; or (b) provided by Conexant to Company. For the avoidance of
doubt, if Company modifies, improves, or combines any such technology equipment,
processes, or methods, the foregoing indemnification obligation will apply to
the extent that Company Infringement Claims are directed at the modifications,
improvements, or combinations, except for modifications, improvements, or
combinations performed at the direction of Conexant or its Affiliates.

        9.3 CONDITIONS. The obligations of the indemnifying Party (the
"INDEMNIFYING PARTY") under Section 9.1 (Conexant Indemnification Obligations)
or Section 9.2 (Company Indemnification Obligations) with respect to a Conexant
Infringement Claim or Company Infringement Claim (as applicable) (an
"INFRINGEMENT CLAIM") are subject to the following conditions: (a) the
indemnified Party (the "INDEMNIFIED PARTY") must promptly notify the
Indemnifying Party in writing of such Infringement Claim; (b) the Indemnifying
Party must have sole control of the defense and settlement of the Infringement
Claim; and (c) the Indemnified Party must fully cooperate with and provide
reasonable assistance to the Indemnifying Party in the defense and settlement of
such Infringement Claim (which includes furnishing to the Indemnifying Party all
evidence in the possession of the Indemnified Party that is relevant to such
Infringement Claim). The Indemnifying Party will not accept a settlement or
stipulated judgment of any Conexant Infringement Claim or Company Infringement
Claim (as applicable) without the prior written consent of the Indemnified
Party, which consent will not be unreasonably withheld. The Indemnifying Party
will have no liability under this Section 9 (Indemnification) for any costs,
losses, liabilities, or damages resulting from the willful acts of the
Indemnified Party or any settlement or compromise incurred or made by the
Indemnified Party without the Indemnifying Party's prior written consent. The
Indemnified Party will have the right to participate, at its own expense, in the
defense or settlement of the Infringement Claim.

        9.4 SOLE AND EXCLUSIVE REMEDY. This Section 9 (Indemnification) states
the Indemnifying Party's entire liability and the Indemnified Party's sole
remedy with respect to the infringement, violation, or misappropriation of any
[...***...] rights of any third party arising from or relating to this Supply
Agreement, other than any rights to indemnification provided for in the
Contribution Agreement. [...***...].

10. CONFIDENTIALITY. The Parties acknowledge that any nonpublic information
disclosed or provided by one Party to another Party in connection with this
Agreement will be subject to the Confidentiality Agreement between the Parties
dated February 23, 2002. The terms and conditions of this Supply Agreement
(including the pricing information contained herein) will be considered to be
the Confidential Information (as defined in the Confidentiality Agreement) of
both parties.

11.     LIMITATIONS OF LIABILITY.

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                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

        11.1 [...***...]

        11.2 BASIS OF BARGAIN. EACH PARTY ACKNOWLEDGES THAT THE MUTUAL
LIMITATIONS OF LIABILITY CONTAINED IN THIS SECTION 11 (LIMITATIONS OF LIABILITY)
REFLECT THE ALLOCATION OF RISK SET FORTH IN THIS SUPPLY AGREEMENT AND THAT EACH
PARTY WOULD NOT ENTER INTO THIS SUPPLY AGREEMENT WITHOUT THESE LIMITATIONS ON
LIABILITY.

12.     TERM; TERMINATION.

        12.1 TERM This Supply Agreement will take effect on the Effective Date
and will remain in effect for a period of [...***...] from the Effective Date
(the "INITIAL TERM"), unless earlier terminated in accordance with this Section
12 (Term; Termination). Following the Initial Term, this Supply Agreement may be
renewed for additional [...***...] renewal terms (each a "RENEWAL TERM"), upon
mutual agreement of the Parties.

        12.2 TERMINATION. This Supply Agreement may be terminated at any time as
follows:

             (a) by written agreement of the Parties;

             (b) by either Party, at its discretion upon written notice to the
other Party, if the other Party materially breaches any provision of this Supply
Agreement and such breach is not cured within [...***...] after written notice
of such breach is furnished by the non-breaching Party;

             (c) by either Party, at its discretion upon written notice to the
other Party, if within any period [...***...] there [...***...] or more material
breaches by the other Party that would constitute grounds for termination
pursuant to this Section 12.2 (without giving effect to cure periods),
regardless of whether such breaches were cured within the applicable cure
periods; or

             (d) by either Party, at its discretion, if (i) the other Party
becomes insolvent, admits in writing its inability to pay its debts as they
become due, or files or has filed against it any proceeding in bankruptcy or for
reorganization under any federal bankruptcy law or similar state law, or has any
receiver appointed for all or a substantial part of such Party's assets or
business, or makes any assignment for the benefit of its creditors, or enters
into any other proceeding for debt relief, and such proceeding is not dismissed
within [...***...] of filing; (ii) the other Party dissolves, liquidates, or
institutes any proceedings for the liquidation or winding up of its business.

        12.3 EFFECT OF TERMINATION. The rights and obligations under Sections 1
(Definitions), [...***...], 8 (Warranty and Disclaimer), 9 (Indemnification), 10
(Confidentiality), 11

                                       20
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<PAGE>

(Limitations of Liability), 12.4 (Effect of Termination), and 13 (General) will
survive termination or expiration of this Supply Agreement for any reason.

13.     GENERAL.

        13.1 AGENCY. Under this Supply Agreement (i) each Party will be deemed
to be an independent contractor and not an agent, joint venturer, or
representative of the other Party; (ii) neither Party may create any obligations
or responsibilities on behalf of or in the name of the other Party; and (iii)
neither Party will hold itself out to be a partner, employee, franchisee,
representative, servant, or agent of the other Party.

        13.2 GOVERNING LAW; VENUE AND JURISDICTION. This Supply Agreement will
be governed by, subject to, and construed in accordance with the internal laws
of the State of Delaware, as such laws apply to contracts between Delaware
residents performed entirely within Delaware. The Parties agree that the United
Nations Convention on Contracts for the International Sale of Goods will not
apply to this Supply Agreement.

        13.3 DISPUTE RESOLUTION. The Parties will act in good faith and use
commercially reasonable efforts to promptly resolve any claim, dispute,
controversy or disagreement arising out of or relating to or in connection with
this Supply Agreement or the breach, termination or validity hereof (each a
"DISPUTE") between the Parties under or related to this Supply Agreement or any
of the transactions contemplated hereby.

             (a) Upon the written request (a "REQUEST") of a Party, the other
Party shall commence good faith negotiations with the goal of resolving the
Dispute on a mutually satisfactory basis. If the Dispute has not been resolved
to the satisfaction of the Parties within [...***...] after the date on which
the Request is delivered, the Dispute shall immediately be referred to senior
officers of each Party. The senior officers of each Party (e.g., chief executive
officer and/or chief executive officer of international business) shall meet
immediately, and in no case later than [...***...] after the date on which the
Request is delivered, for a minimum of [...***...] with a mutually selected
mediator and attempt in good faith to negotiate a resolution of the Dispute. If
the Parties are unable to resolve the Dispute within [...***...] after the date
on which the Request is delivered, then any relevant Party may submit the
Dispute to arbitration as the exclusive means of resolving it in accordance with
the procedures set forth in this Section 13.3.

             (b) Except as otherwise specified in this Section 13.3, any Dispute
not resolved through the procedure set forth above shall be finally settled by
arbitration in accordance with the International Rules and Procedures of the
American Arbitration Association (the "ARBITRATION RULES"), which are deemed to
be incorporated by reference herein except as otherwise modified herein.

             (c) The arbitration situs shall be Wilmington, Delaware, and the
laws of the State of Delaware shall be applied.

             (d) In the event of arbitration, there shall be one arbitrator who
shall be jointly nominated by such parties. If the Parties fail to so nominate
the arbitrators within [...***...] from the date when the Dispute is
submitted to arbitration pursuant to this Section 13.3, at the request of any
Party, the arbitrator(s) shall be appointed in accordance with the Arbitration
Rules.

                                       21
                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

             (e) The arbitration hearing shall commence no later than
[...***...] following the appointment of the sole arbitrator, as the case may
be, and the final award shall be rendered no later than [...***...] following
the close of the hearing.

             (f) Consistent with the expedited nature of arbitration, each Party
will, upon the written request of the other Party, provide the other with copies
of documents relevant to the issue raised by any claim or counterclaim. Other
discovery may be ordered by the arbitrator to the extent the arbitrator deems
additional discovery relevant and appropriate, and any dispute regarding
discovery, relevance or scope thereof, shall be determined by the arbitrator,
which determination shall be conclusive.

             (g) By agreeing to arbitration, the Parties do not intend to
deprive any court of its jurisdiction to issue a pre-arbitral injunction,
pre-arbitral attachment, injunctive or other equitable relief or an order in aid
of arbitration proceedings and the enforcement of any award. Without prejudice
to such provisional remedies in aid of arbitration as may be available under the
jurisdiction of a national court, the arbitral tribunal shall have full
authority to grant provisional remedies and to award damages for the failure of
any party to respect the arbitral tribunal's orders to that effect.

             (h) The award shall be final and binding upon the Parties, and
shall be the sole and exclusive remedy between the Parties regarding any claims,
counterclaims, issues, or accounting presented to the arbitral tribunal in
connection with the Dispute. Judgment upon any award may be entered in any court
having competent jurisdiction thereof.

             (i) The costs of the arbitration shall be borne as determined in
accordance with the Arbitration Rules; provided, however, that to the extent a
Party is non-prevailing or unsuccessful on a claim in an arbitration proceeding
under this Section 13.3 as determined by the arbitrator, that Party shall pay
the prevailing or successful Party's costs and expenses incurred in connection
with the arbitration of that Dispute, including attorneys' fees and arbitration
expenses, whether or not such Dispute is prosecuted to award or judgment.

             (j) Subject to the receipt of any applicable governmental approval,
any monetary award shall be made and promptly payable in U.S. dollars, if due in
U.S. dollars, free of any deduction or offset, and the arbitral tribunal shall
be authorized in its discretion to grant pre-award and post-award interest at
commercial rates. The arbitral tribunal shall have the authority to award any
remedy or relief proposed by the claimants or respondents pursuant to this
Supply Agreement, including without limitation, a declaratory judgment, specific
performance of any obligation created under this Supply Agreement or the
issuance of an injunction.

        13.4 [...***...]

                                       22
                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

        13.5 THIRD-PARTY BENEFICIARIES. Except for Conexant Spin-offs, there are
no third-party beneficiaries of this Supply Agreement. Except for the pricing
established under this Supply Agreement, and the rights of Conexant Spin-offs to
purchase Wafers from Company at such pricing, no provision of this Supply
Agreement, express or implied, is intended or will be construed to confer upon
or give to any customer or other person other than the Parties any rights,
remedies, or other benefits under or by reason of this Supply Agreement.

        13.6 COMPLIANCE WITH LAW. The Parties will at all times comply with all
applicable foreign, U.S., state, and local laws, rules and regulations relating
to the execution, delivery and performance of this Supply Agreement. Each Party
agrees that it will not export or reexport, resell, ship, or divert or cause to
be exported or reexported, resold, shipped, or diverted directly or indirectly
any software, documentation, or technical data incorporating any software to any
country for which the government (or any agency thereof) of the United States,
or any foreign sovereign government with competent jurisdiction requires an
export license or other governmental approval without first obtaining such
license or approval.

        13.7 FORCE MAJEURE. Neither Party shall be liable for failure or delay
in performance of its obligations under this Supply Agreement to the extent such
failure or delay is caused by an act of God, act of a public enemy, war or
national emergency, rebellion, insurrection, riot, epidemic, quarantine
restriction, fire, flood, explosion, storm, earthquake, interruption in the
supply of electricity, power, or energy, or other catastrophe, terrorist attack,
labor dispute or disruption of such Party's suppliers, or other event beyond the
reasonable control of such Party. If a Party's performance under this Supply
Agreement is affected by a force majeure event, such Party shall give prompt
written notice of such event to the other Party and shall at all times use its
reasonable commercial efforts to mitigate the impact of the force majeure event
on its performance under this Supply Agreement. In the event of a force majeure
event as described in this Section that affects either or both Parties' ability
to perform under this Supply Agreement, the Parties agree to cooperate in good
faith in order to resume the transactions contemplated by this Supply Agreement
as soon as commercially possible to the extent commercially reasonable.

        13.8 AMENDMENT; LATER AGREEMENT. This Supply Agreement may not be
amended, modified, or supplemented by the Parties in any manner, except by an
instrument in writing signed by Conexant and Company and specifically reciting
that it amends this Supply Agreement. No purchase order or acknowledgement will
amend this Supply Agreement. All matters designated herein as subject to
agreement of the Parties must be agreed upon in a writing signed by authorized
representatives of both Parties for such agreement to be effective.

        13.9 NOTICES. Any notice, consent, approval, or other communication
intended to have legal effect to be given under this Supply Agreement (other
than a purchase order or invoice) must be in writing and will be delivered (as
elected by the Party giving such notice): (i) personally; (ii) by postage
prepaid registered or certified airmail, return receipt requested; (iii) by
express courier service; or (iv) by facsimile with a confirmation copy deposited
prepaid with an express courier service. Unless otherwise provided herein, all
notices will be deemed to have been duly given on: (y) the date of receipt (or
if delivery is refused, the date of such refusal) if delivered

                                       23
                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

personally, by mail, or by express courier; or (z) one (1) business day after
receipt by telecopy if the telecopy was accompanied by the mailing of the notice
via mail or courier service. Each Party may change its address for purposes
hereof on not less than three (3) days' prior notice to the other Party. Notice
hereunder will be sent to the following addresses (with a copy to the legal
department):

    If to Conexant, to:                       If to Company, to:

    Conexant Systems, Inc.                    Specialtysemi, Inc.

    4311 Jamboree Road                        c/o The Carlyle Group

    Newport Beach, CA 92660                   101 S. Tryon Street, 25th Floor

    Attn: General Counsel                     Charlotte, N.C. 28280

    Telecopy: (949) 483-9576                  Attn: Claudius E. Watts, IV

                                              Telecopy:  (704) 632-0299

        13.10 ASSIGNMENT. Except as otherwise expressly provided in this Supply
Agreement, neither Party shall be permitted to assign any of its rights or
delegate any of its obligations under this Supply Agreement without the prior
written consent of the other Party; except that (i) Company may, without such
consent, assign all such rights to any Affiliate controlling Company or to any
Person providing cash financing to the Company as collateral security for such
financing provided that no such assignment shall relieve Company from any of its
obligations hereunder, (ii) Conexant may, without such consent, assign all such
rights to any Affiliate controlling Conexant, provided that no such assignment
shall relieve Conexant from any of its obligations hereunder, and (iii) either
Party may, without the other Party's consent, assign all rights to any entity
which acquires, directly or indirectly, all or any substantial portion of the
assets or securities of such Party. Any unauthorized assignment or transfer
shall be null and void. This Supply Agreement shall be binding upon and inure
solely to the benefit of each Party and its successors and permitted assigns.

        13.11 WAIVER. If a Party fails to insist on performance of any of the
terms and conditions, or fails to exercise any of its rights or privileges of
this Supply Agreement, such failure will not constitute a waiver of such terms,
conditions, rights, or privileges.

        13.12 SEVERABILITY. If the application of any provision or provisions of
this Supply Agreement to any particular facts or circumstances is held to be
invalid or unenforceable by any court of competent jurisdiction, then: (i) the
validity and enforceability of such provision or provisions as applied to any
other particular facts or circumstances and the validity of other provisions of
this Supply Agreement will not in any way be affected or impaired thereby; and
(ii) such provision or provisions will be reformed without further action by the
Parties and only to the extent necessary to make such provision or provisions
valid and enforceable when applied to such particular facts and circumstances.

        13.13 COUNTERPARTS AND FACSIMILE This Supply Agreement may be executed
in any number of counterparts, each of which when so executed and delivered will
be deemed an original,

                                       24

                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

and such counterparts together will constitute one and the same instrument. The
Parties intend that each Party will receive a duplicate original of the
counterpart copy or copies executed by it. For purposes hereof, a facsimile copy
of this Supply Agreement, including the signature pages hereto, will be deemed
to be an original.

        13.14 RULES OF CONSTRUCTION.. As used in this Supply Agreement, all
terms used in the singular will be deemed to include the plural, and vice versa,
as the context may require. The words "hereof," "herein," and "hereunder" refer
to this Supply Agreement as a whole, including the attached exhibits, as the
same may from time to time be amended or supplemented, and not to any
subdivision in this Supply Agreement. When used in this Supply Agreement, unless
otherwise expressly stated, "including" means "including, without limitation"
and "discretion" means sole discretion. Unless otherwise expressly stated, when
a Party's approval or consent is required under this Supply Agreement, such
Party may grant or withhold its approval or consent in its discretion.
References to "Section" or "Exhibit" will be to the applicable section or
exhibit of this Supply Agreement. Descriptive headings are inserted for
convenience only and will not be utilized in interpreting the Supply Agreement.
This Supply Agreement has been negotiated by the Parties and reviewed by their
respective counsel and will be fairly interpreted in accordance with its terms
and without any strict construction in favor of or against either Party.

        13.15 SCHEDULES AND EXHIBITS Conexant hereby represents and warrants to
Company that the information related to the fabrication processes conducted at
the Newport Beach Fab provided by Conexant in Exhibit B, Schedule 2 (the
"Fabrication Information") is materially true and correct as of the Effective
Date. If the Fabrication Information is later found not to have been materially
true and correct as of the Effective Date [...***...] Conexant will work
together in good faith with Company to recalculate a new price based upon
corrected assumptions. The Parties will determine whether there were any amounts
overpaid or underpaid for purchases previously conducted pursuant to this Supply
Agreement as a result of using the original price, and settle any underpayments
or overpayments within [...***...].

        13.16 ENTIRE AGREEMENT. As to the subject matter hereof: (i) this Supply
Agreement, including its exhibits, sets forth the entire agreement between
Conexant and Company; (ii) no promise, inducement, understanding, or agreement
not expressly contained herein has been made; and (iii) this Supply Agreement
merges and supersedes any and all previous agreements, understandings, and
negotiations between the Parties concerning the subject matter hereof.

        [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

                                       25
                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

               IN WITNESS WHEREOF, the parties have executed this Supply
Agreement as of the Effective Date by the undersigned duly authorized
representatives of each party.

CONEXANT SYSTEMS, INC.,              SPECIALTYSEMI, INC.,
a Delaware corporation               a Delaware corporation

By:  /s/  Dwight Decker              By:  /s/  Claudius E. Watts IV
     ----------------------------         ----------------------------
Name:  Dwight Decker                 Name:  Claudius E. Watts IV
Title:  Chief Executive Officer      Title:  President

                                       26
<PAGE>

                               EXHIBIT A - PRICING

WAFER PRICING.

[...***...]

                                       27

                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

PROBE SERVICES AND RE-PROBE SERVICES.

        [...***...]

                                       28

                                              * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                      EXHIBIT B - WAFER VOLUME COMMITMENTS

                                   SCHEDULE 1

[...***...]

                                      29.    * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                    EXHIBIT B

                                   SCHEDULE 2

                                WAFER MOVES TABLE

[...***...]

                                      30.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      31.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

         EXHIBIT C -- RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES

                                   [...***...]

                                      32.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

[...***...]

                                      33.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

[...***...]

                                      34.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

[...***...]

                                      35.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

[...***...]

                                      36.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

[...***...]

                                      37.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      38.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      49.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      40.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      41.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      42.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      43.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      44.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      45.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      46.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      47.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      48.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

        [...***...]

                                      49.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>
Title:                                                    Document #:  Revision:
RULES OF CHANGE, OPERATION AND RELEASE PROCEDURES           GN00-P035     H
--------------------------------------------------------------------------------
                             CONEXANT SYSTEMS, INC.                    Page #:
                  4311 Jamboree Road, Newport Beach, CA 92660           of 16
--------------------------------------------------------------------------------

[...***...]

                                      50.     * CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                  EXHIBIT D --

[...***...]

                                      51.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                            EXHIBIT E -- [...***...]

[...***...]

                                      52.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                       EXHIBIT F - QUALITY SPECIFICATIONS

[...***...]

                                      53.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      54.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      55.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      56.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      57.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      58.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                       EXHIBIT G - DELIVERY AND LOGISTICS

[...***...]

                                      59.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      60.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      61.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      62.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      63.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      64.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   [...***...]

                                      65.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                         [...***...]

                                      66.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      67.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      68.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      69.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      70.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      71.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      72.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      73.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

                                      74.     * CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                               EXHIBIT H - REPORTS

[...***...]

                                      75.     * CONFIDENTIAL TREATMENT REQUESTEDExhibit 10.139

 

Exhibit 10.139

SERVICES TERMINATION AGREEMENT

     THIS SERVICES TERMINATION AGREEMENT (this “Agreement”) is made and entered
into as of April 30, 2002 (the “Effective Date”), by and between San Fernando
Community Hospital, a California nonprofit public benefit corporation d/b/a
Mission Community Hospital and San Fernando Community Hospital (“Hospital”),
and OptimumCare Corporation, a Delaware corporation (“Manager”).

WITNESSETH:

     WHEREAS, Hospital is a California nonprofit public benefit corporation;

     WHEREAS, Hospital and Manager are parties to that certain Mental Health
Outpatient Hospitalization Services Agreement dated as of December, 1999, and
that certain Mental Health Inpatient Hospitalization Services Agreement dated
as of December, 1999, as the same may have been amended (collectively, the
“Services Agreements”), pursuant to the terms of which Manager agreed to
provide certain management and administrative services related to the
non-medical aspects of Hospital’s business operations; and

     WHEREAS, each of Hospital and Manager desire to terminate the Services
Agreements;

     NOW, THEREFORE, in consideration of the promises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged and confessed, the parties hereto hereby agree as follows:

ARTICLE 1.

TERMINATION OF SERVICES AGREEMENTS

     Section 1.1. Termination. Subject to the terms and conditions of this
Agreement, and upon the basis of the representations and warranties herein
contained, the Services Agreements are hereby terminated by mutual agreement of
Hospital and Manager effective as of the Effective Date.

ARTICLE 2.

PAYMENTS TO MANAGER

     Section 2.1. Subject to the terms and conditions of this Agreement,
Manager shall be entitled to (a) payment in the aggregate amount of Three
Hundred Thousand Dollars ($300,000.00) as compensation for the early
termination of the Services Agreements prior to the natural expiration of their
terms (“Termination Fee”), and (b) payment of Seven Hundred Seventy Five
Thousand Dollars ($773,931.00) in full satisfaction of all past invoices and
services incurred as of the Effective Date of this Agreement (“Final Payment”).

 

     Section 2.2. The Termination Fee and Final Payment shall be paid by check
and delivered to Manager by Hospital upon execution of this Agreement

ARTICLE 3.

PERFORMANCE UNDER SERVICES AGREEMENTS

     Section 3.1. Manager hereby agrees that, except as otherwise provided in
this Agreement, no fees, bonuses or other amounts are or shall become payable
by Hospital to Manager in respect of Manager’s services pursuant to the
Services Agreements.

     Section 3.2. Hospital hereby agrees that, except as otherwise provided in
this Agreement, from and after the Effective Date, Manager shall not be
required to perform any services or duties pursuant to the terms of the
Services Agreements.

     Section 3.3. Except as provided in Section 3.4. below, Hospital and
Manager agree that this Agreement shall not excuse their promises and
obligations set out in Section 5.6 — Effects of Termination in each of the
Services Agreements during the period after to the Effective Date.

     Section 3.4. Manager hereby agrees that the Final Payment constitutes
full compensation owed to Manager for services rendered to Hospital on or prior
to the Effective Date. Except with respect to those (9) individuals listed on
Schedule 3.4 and Manager’s employees who work in the OptimumCare Call Center
other than those individuals who are also employed by Hospital, Manager hereby
waives Section 6.6 of each of the Services Agreements and Hospital shall
hereinafter be excused from any and all non-solicitation covenants,
limitations, restrictions, and/or prohibitions with regard to Hospital’s
solicitation, hiring and/or retention of Manager’s employees.

ARTICLE 4.

MISCELLANEOUS PROVISIONS

     Section 4.1. Notices. Each notice, request, demand, approval or other
communication which may be or is required to be given under this Agreement
shall be in writing and shall be deemed to have been properly given when
delivered personally at the address set forth below for the intended party
during normal business hours at such address, when sent by facsimile or other
electronic transmission to the respective facsimile transmission numbers of the
parties set forth below with telephone confirmation of receipt, or three (3)
business days after the date when sent by recognized overnight courier or by
United States registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

 

If to Hospital:

Mission Community Hospital 14850 Roscoe Boulevard Panorama City,
California 91402 Attention: Chief Executive Officer Facsimile: (818) 904-3529
Confirm: (818) 787-2222 With copy to: Davis Wright Tremaine LLP 865 S. Figueroa
Street, Suite 2400 Los Angeles, California 90017 Attention: Thomas E. Jeffry,
Jr., Esq. Facsimile: (213) 633-6899 Confirm: (213) 633-6800

If to Manager:

OptimumCare Corporation 30011 Ivy Glenn Drive Laguna Niguel, CA 92677
Attention: Edward Johnson Facsimile: (310) 410-5148 Confirm: (310) 410-5142
Notices shall be given to such other addressee or address, or both, or by way
of such other facsimile transmission number, as a particular party may from
time to time designate by written notice to the other parties hereto.

     Section 4.2. Further Assurance. Each of the parties hereto hereby agrees
that it will from time to time, upon the reasonable request of another party
hereto, take such further action as the other may reasonably request to carry
out the provisions of this Agreement.

     Section 4.3. Execution and Counterparts. This Agreement may be executed
in any number of counterparts, each and all of which shall be deemed for all
purposes to be one agreement.

     Section 4.4. Headings. The headings in this Agreement are intended
solely for convenience of reference and shall be given no effect in the
construction or interpretation of this Agreement.

     Section 4.5. Effectiveness. This Agreement shall have no force or effect
whatsoever unless and until the same shall have been executed and delivered by
Hospital and Manager.

     Section 4.6. Miscellaneous. This Agreement (a) constitutes the entire
agreement and supersedes all other prior agreements and undertakings, both
written and oral, between the parties hereto with respect to the subject matter
hereof; (b) is not intended to confer upon any other person or entity who or
which is not a party hereto any rights or remedies hereunder; (c) shall be
binding upon and inure to the benefit of Hospital and Manager and their
respective heirs, personal representatives, successors and assigns; and (d)
shall be governed in all respects, including validity, interpretation and
effect, by the laws of the State of California, except as otherwise provided
herein. This Agreement is intended to be binding upon, and shall bind and
create legal rights and/or obligations with respect to, only Hospital and
Manager and not their respective affiliates.

     Section 4.7. Amendment. This Agreement may not be amended except by an

 

instrument in writing signed by Hospital and Manager.

     Section 4.8. Waiver. Any terms or provisions of this Agreement may be
waived in writing at any time by the party that is entitled to the benefits
thereof, or its respective counsel. The failure of either party at any time or
times to require performance of any provision hereof shall in no manner affect
such party’s right at a later time to enforce the same. No waiver by any party
of a condition or of the breach of any term, covenant, representation or
warranty of this Agreement, whether by conduct or otherwise, in any one or more
instances shall be deemed to be or construed as a further or continuing waiver
of any such condition or breach or a waiver of any other condition or of the
breach of any other term, covenant, representation or warranty of this
Agreement.

     Section 4.9. Attorneys’ Fees. Each of the parties shall bear all
attorneys’ fees and costs arising from the actions of its own counsel in
connection with this Agreement, with the termination of the Services
Agreements, and the matters and documents referred to herein. In the event any
party to this Agreement institutes litigation to enforce any term or provision
of this Agreement, the successful party in such action shall be entitled to
recover from the unsuccessful party all costs and expenses incurred in such
litigation expressly including, but not limited to, reasonable attorneys’ fees,
and such costs, expenses and attorneys’ fees shall be included in and made a
part of any judgment rendered in such litigation.

     Section 4.10. Independent Advice. Each party represents that is has
received independent legal advice from its attorneys with respect to the
advisability of making the settlement provided for herein, with respect to the
advisability of executing this Agreement, and with respect to the meaning of
California Civil Code Section 1542.

     Section 4.11. Risks of Mistake. In entering into this Agreement and the
settlement provided for herein, each party assumes the risks of any mistake.
If any party should subsequently discover that any fact relied upon by it in
entering into this Agreement was untrue, or that such party’s understanding of
the facts or of the law was incorrect, such party shall not be entitled to any
relief in connection therewith, including, without limitation on the generality
of the foregoing, any alleged right or claim to set aside or rescind this
Agreement. This Agreement is intended to be and is final and binding between
the parties hereto, regardless of any claims of promise made without the
intention to perform, inadequacy of consideration, mistake of fact or law, or
of any other circumstance whatsoever.

     Section 4.12. Each Term Contractual. Each term of this Agreement is
contractual and not merely a recital.

     Section 4.13. No Transfer of Claims. Each party hereto represents that
it has not hypothecated, mortgaged, assigned, encumbered, transferred or
otherwise disposed of any claim or loss that is or may be the subject of this
Agreement. Each party hereto covenants and agrees that it will not assign or
transfer any claims which have been settled and

 

released pursuant to this
Agreement to any third party for any purpose, including but not limited to
assignment for collection.

     IN WITNESS WHEREOF, the parties hereto have caused this Services
Termination Agreement to be executed as of the day and year first above
written.

“Manager”

OptimumCare Corporation,

a Delaware corporation

 

 

By: ______________________________

Name: Edward A. Johnson

Its: Chief Executive Officer

 

 

“Hospital”

San Fernando Community Hospital,

a California nonprofit public benefit corporation

d/b/a Mission Community Hospital and San Fernando Community Hospital

 

 

By: _______________________________

Name: William W. Daniel

Its: Chief Executive Officer

 

Schedule 3.4

 

     LIST OF PERSONS THAT MAY NOT BE HIRED BY HOSPITAL

1.      JUDITH ARRANTS

 

2.      ROBYN CHEMRINOW

 

3.      APRIL HADDAD

 

4.      LYNN SURATOS

 

5.      BOBBIE BONGIORNO

 

6.      LAURA CAMPBELL

 

7.      GINA HILDEBRAND

 

8.      KIRSTEN KEMPFER

 

9.      TYRONE EVANS

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