Document:

LESSOR                                      LEASE NUMBER

FULL LEGAL NAME AND AGGRESS OF LESSEE       SUPPLIER OF EQUIPMENT
                                            (COMPLETE ADDRESS)

JOINTLY AND SEVERALLY RESPONSIBLE

QUANTITY         DESCRIPTION, MODEL #, CATALOG # OR OTHER IDENTIFICATION

EQUIPMENT LOCATION IF DIFFERENT:
STREET ADDRESS:
CITY:                     COUNTY                STATE          ZIP

TERMS:
AMOUNT OF EACH PAYMENT (PLUS SALES TAX IF APPLICABLE):

MONTHLY:             TERM OF LEASE          NO. OF PAYMENTS:     SECURITY
OTHER (SPECIFY):     (NO. OF MONTHS):                            DEPOSIT:

1.  LEASE.  Lessee hereby leases from Lessor, and Lessor leases to Lessee ,
the personal property described above, together with any replacement parts,
additions, repairs or accessories now or hereafter incorporated in or affixed
to it (hereafter referred to as the "Equipment").

2.  ACCEPTANCE OF EQUIPMENT.  Lessee agrees to inspect the Equipment and to
execute an Acknowledgment and Acceptance of Equipment by Lessee notice, as
provided by Lessor, after the Equipment has been delivered and after Lessee is
satisfied that the Equipment is satisfactory in every respect.  Lessee hereby
authorizes Lessor to insert in this Lease serial numbers or other identifying
data with respect to the Equipment.

3.  DISCLAIMER OF WARRANTIES AND CLAIMS; LIMITATIONS OF REMEDIES.  THERE ARE
NO WARRANTIES BY OR ON BEHALF OF LESSOR.  Lessee acknowledges and agrees
by his signature below as follows:
     (a) LESSOR MAKES NO WARRANTIES EITHER EXPRESS OR IMPLIED AS TO THE
CONDITION OF THE EQUIPMENT.  IT'S MERCHANTABILITY, IT'S FITNESS OR SUITABILITY
FOR ANY PARTICULAR PURPOSE, IT'S DESIGN, IT'S CAPACITY, IT'S QUALITY, OR WITH
RESPECT TO ANY CHARACTERISTICS OF THE EQUIPMENT;
     (b) Lessee has fully inspected the Equipment which it has requested
Lessor to acquire and lease to Lessee, and the Equipment is in good condition
and to Lessee's complete satisfaction;
     (c) Lessee leases the Equipment "as is" and with all faults;
     (d) Lessee specifically acknowledges that the Equipment is leased to
Lessee solely for commercial or business purposes and not for personal,
family, household, or agricultural purposes;
     (e) If the Equipment is not properly installed, does not operate as
represented or warrantied by the supplier or the manufacturer of the
Equipment;
     (f) Provided Lessee is not in default under this Lease, Lessor assigns to
Lessee any warranties made by the supplier or the manufacturer of the
Equipment;
     (g) LESSEE SHALL HAVE NO REMEDY FOR CONSEQUENTIAL OR INCIDENTAL DAMAGES
AGAINST LESSOR; and
     (h) NO DEFECT, DAMAGE, OR UNFITNESS OF THE EQUIPMENT FOR ANY PURPOSE
SHALL RELIEVE LESSEE OF THE OBLIGATION TO PAY RENT OR RELIEVE LESSEE OF ANY
OTHER OBLIGATION UNDER THIS LEASE.

The parties have specifically negotiated and agreed to the foregoing
paragraph.
INITIALS:

4.  STATUTORY FINANCE LEASE.  Lessee agrees and acknowledges that it is the
intent of both parties to this Lease that it qualify as a statutory finance
lease under Article 2A of the Uniform Commercial Code.  Lessee acknowledges
and agrees that Lessee has selected both (1) the Equipment ; and (2) the
supplier from whom Lessor is to purchase the Equipment.  Lessee acknowledges
that Lessor has not participated in any way in Lessee's selection of the
Equipment or of the supplier, and Lessor has not selected, manufactured, or
supplied the Equipment.

     LESSEE SHOULD CONTACT THE SUPPLIER OF THE EQUIPMENT FOR A DESCRIPTION OF
ANY SUCH RIGHTS.

5.  ASSIGNMENT BY LESSEE PROHIBITED.  WITHOUT LESSOR'S PRIOR WRITTEN CONSENT,
LESSEE SHALL NOT ASSIGN THIS LEASE OR SUBLEASE THE EQUIPMENT OR ANY INTEREST
THEREIN, OR PLEDGE OR TRANSFER THE LEASE, OR OTHERWISE DISPOSE OF THE
EQUIPMENT ----- HEREBY.

6.  COMMENCEMENT; RENTAL PAYMENTS; INTERIM RENTALS.  This Lease shall commence
upon the written acceptance hereof by Lessor and shall and upon full
performance and observance by Lessee of each and every term, condition and
covenant set forth in the Lease, any schedules hereto and any extensions
hereof.  Rental payments shall be in the amounts and frequency as set forth on
the face of the Lease or any schedule hereto.  In addition to regular rentals,
Lessee shall pay to Lessor interim rent for the use of the Equipment prior to
the due date of the first payment.  Interim rent shall be in an amount equal
to that of the monthly rental, multiplied by the number of days elapsing
between the date on which the Equipment is accepted by Lessee and the
commencement date of this Lease, together with the number of days elapsing
between commencement of the Lease and the due date of the first payment.  The
payment of interim rent shall be due and payable upon Lessee's receipt of this
invoice from Lessor.  The rental period under the Lease shall terminate
following the last day or on the terms stated on the face hereof or in any
schedule hereto unless such Lease or schedule has been extended or otherwise
modified.  Lessor shall have no obligation to Lessee under this Lease if the
Equipment, for whatever reason, is not delivered to Lessee within ninety (90)
days after Lessee signs this Lease. Lessor shall have no obligation to Lessee
under this Lease if Lessee fails to execute and deliver to Lessor an
Acknowledgement and Acceptance of Equipment by Lessee acknowledging his
acceptance of the Quipment within thrity (30) days after it is delivered to
Lessee, with respect to this Lease or any schedule hereto.

THIS LEASE IS NOT CANCELABLE OR TERMINABLE BY LESSEE.

SEE REVERSE SIDE FOR ADDITIONAL TERMS AND CONDITIONS WHICH ARE A PART OF THIS
LEASE.

LESSEE UNDERSTANDS AND ACKNOWLEDGES THAT NO BROKER OR SUPPLIER, NOR ANY
SALESMAN, BROKER, OR AGENT OF ANY BROKER OR SUPPLIER IS AN AGENT OF LESSOR.
NO BROKER OR SUPPLIER, NOR ANY SALESMAN, BROKER, OR AGENT OF ANY BROKER OR
SUPPLIER, IS AUTHORIZED TO WAIVE OR ALTER ANY TERM OR CONDITION OF THIS LEASE.
AND NO REPRESENTATION AS TO THE EQUIPMENT OR ANY OTHER MATTER BY THE BROKER OR
SUPPLIER, NOR ANY SALESMAN BROKER OR AGENT OF ANY BROKER OR SUPPLER SHALL IN
ANY WAY EFFECT LESSEE'S DUTY TO PAY THE RENTALS ND TO PERFORM LESSEE'S
OBLIGATIONS SET FORTH IN THIS LEASE.

7.  CHOICE OF LAW.  This Lease shall not be effective until signed by Lessor
at the principal office listed above.  This Lease shall be considered to have
been made in the state of Lessor's principle place of business listed above
and shall be interpreted in accordance with the laws and regulations of the
state of Lessor's principal place of business.
     Lessee agrees to jurisdiction in the state of Lessor's principal place of
business listed above in any action, suit or proceeding regarding the Lease,
and concedes that they and each of them, transacted business in the state of
Lessor's principal place of business listed above by entering into this Lease.
In the event of any legal action with regard to this Lease or the Equipment
covered hereby, Lessee agrees that venue may be set the County of Lessor's
principal place of business.

LESSEE:                 DATE:           LESSOR:                DATE:

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

                        DATE:

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

<PAGE>

8.  SECURITY DEPOSIT.  As security for the prompt and full payment of the
amounts under the Lease and Lessee's complete performance of all of its
obligations under this Lease and any extension hereof, Lessee has deposited
with Lessor the security amount set forth in the section entitled "Security
Deposit".  In the event any default shall be made in the performance of any of
the Lessee's obligations under this Lease, Lessor shal have the right, but
shall not be obligated, to apply

 .

9.  LIMITED PREARRANGED AMENDMENTS: SPECIFIC POWER OF ATTORNEY.  In the event
it is necessary to amend the terms of this Lease to reflect a change in one or
more of the following conditions:

(a) Lessor's actual cost of procuring the Equipment; or
(b) Lessor's actual cost of providing the Equipment to Lessee; or
(c) A change in rental payments as a result of (1) or (2) above; or
(d) Description of the Equipment;

Lessee agrees that any such amendment shall be described in a letter from
Lessor to Lessee, and unless within 15 days after the date of such letter
Lessee objects in writing to Lessor, this Lease shall be deemed amended and
such amendments shall be incorporated in this Lease herein as if originally
set forth.

Lessee grants to Lessor a specific power of attorney for Lessor to use as
follows: (1) Lessor may sign and file on Lessee's behalf any document Lessor
deems necessary to perfect or protect Lessor's interest in the Equipment or
pursuant to the Uniform Commercial Code; and (2) Lessor may sign, endorse or
negotiate for Lessor's benefit any instrument regarding proceeds from any
policy of insurance covering the Equipment.

10.  LOCATION.  The Equipment shall be kept at the location specified above
or, if none is specified, at Lessee's address as set forth above and shall not
be removed without Lessor's prior written consent.

11.  USE.  Lessee shall use the Equipment in a careful manner, make all
necessary repairs at Lessee's expense, shall comply with all laws relating to
its possession, use, or maintenance, and shall not make any alterations,
additions, or improvements to the Equipment without Lessor's prior written
consent.  All additions, repairs or improvements made to the Equipment shall
belong to Lessor.

12.  OWNERSHIP; PERSONALTY.  The Equipment is, and shall remain, the property
of Lessor, and Lessee shall have no right, title or interest in the Equipment
except as expressly set forth in this Lease.  The Equipment shall remain
personal property even though installed or attached to real property.

13.  SURRENDER.  By this Lease, Lessee acquires no ownership rights in the
Equipment and acquires no option to purchase same.  Upon the expiration, or
earlier termination or cancellation of this Lease, or in the event of a
default under Paragraph 21 hereof, Lessee, at its expense, shall return the
Equipment in good repair, ordinary wear and tear resulting from proper use
thereof excepted, by delivering it ready for shipment, to such place as Lessor
may specify.

14.  RENEWAL.  At the expiration of the Lease, Lessee shall return the
Equipment in accordance with Paragraph 13, hereof.  At Lessor's option, this
Lease may be continued on a month-to-month basis until 30 days after Lessee
returns the Equipment to Lessor.  In the event the Lease is so continued,
Lessee shall pay to Lessor rentals in the same periodic amounts indicated
under "Amount of Each Payment," above.

15.  LOSS AND DAMAGE.  Lessee shall at all times after signing this Lease bear
the entire risk of loss, theft, damage or destruction of the Equipment from
any cause whatsoever, and no loss, theft, damage or destruction of the
Equipment shall relieve Lessee of the obligation to pay rent or to comply with
any other obligation under this Lease.  In the event of damage to any part of
the Equipment, Lessee shall immediately place in again in good repair at
Lessee's expense.  If Lessor determines that any part of the Equipment is
lost, stolen, destroyed, or damaged beyond repair, Lessee shall at Lessee's
option do one of the following:

(a) Replace the same with like equipment in good repair, acceptable to Lessor;
or
(b) Pay Lessor in cash the following: (i) all amounts due by Lessee to Lessor
under this Lease up to the date of the loss; (ii) the accelerated balance of
the total amounts due for the remaining term of this Lease attributable to
said item, discounted to present value at a discount rate of 9% as of the date
of loss, and (iii) the Lessor's interest as of the time this Lease was entered
into of Lessor's residual interest in the Equipment discounted to present
value at a discount rate of 9%, as of the date of loss.  Upon Lessor's receipt
of payment as set forth above, Lessee shall be to the Equipment without any
warranties.  If insurance proceeds are used to fully comply with this
subparagraph, the balance of any such proceeds shall go to Lessee to
compensate for loss of use of the Equipment for the remaining term of the
Lease.

16.  INSURANCE; LIENS; TAXES.  Lessee shall provide and maintain insurance
against loss, theft, damage, or destruction of the Equipment in an amount not
less than the net replacement value of the Equipment, payable to Lessor.
Lessee also shall provide and maintain comprehensive general all-risk
liability insurance including but not limited to product, liability coverage,
insuring Lessor and Lessee, with a severability of interest endorsement, or
its equivalent, against any and all loss or liability for all damages, either
to persons or property or otherwise, which might result from or happen in
connection with the condition, use or operation of the Equipment, with such
limits and with an insurer satisfactory to Lessor.  Each policy shall
expressly provide that said insurance as to Lessor and its assigns shall not
be invalidated by any act, omission, or neglect of Lessee and cannot be
canceled without 30 days' prior written notice to Lessor.  As to each policy,
Lessee shall furnish to Lessor a certificate of insurance from the insurer,
which certificate shall evidence the insurance coverage required by this
paragraph.  Lessor shall have no obligation to ascertain the existence of or
provide any insurance coverage for the Equipment or for Lessee's benefit if
Lessee fails to provide such insurance.  Lessor will have the right, but no
obligation, to have such insurance protecting Lessor placed at Lessee's
expense.  Such placement will result in an increase in Lessee's periodic
payment, such increase being attributed to Lessor's costs of obtaining such
insurance any customary charges or terms of Lessors or its designee associated
with such insurance.

Lessee shall keep the Equipment free and clear of all levies, liens and
encumbrances.  Lessee shall pay all charges and taxes (local, state and
federal) which may now or hereafter be imposed upon the ownership, rental,
sale, purchase, possession or use of the Equipment, excluding, however all on
or measured by Lessor's net income if Lessee fails to pay said charges or
taxes.  Lessor shall have the right, but shall not be obligated, to pay such
charges or taxes in that event.  Lessor shall notify Lessee of such payment
and Lessee shall repay to Lessor the cost thereof within 15 days after such
notice is mailed to Lessee.

17.  INDEMNITY.  Lessee shall indemnify Lessor against any claims, actions,
damages or liabilities including all attorney's fees, arising out of or
connected with the Equipment, without limitation.  Such indemnification shall
survive the cancellation or termination of this Lease.  Lessee waives any
indemnity Lessee may have under any insurance with regard to indemnification
of Lessor.

18.  ASSIGNMENT BY LESSOR.

19.  SERVICE CHARGES; INTEREST.  If Lessee shall fail to make any payment
required by this Lease within 10 days of the due date thereof, Lessee shall
pay to Lessor a service charge of 8% of the amount due, provided, however,
that not more than one such service charge shall be made on any delinquent
payment, regardless of the length of the delinquency in addition to the
foregoing service charge.  Lessee shall pay to Lessor a $100 default fee with
respect to any payment which becomes thirty (30) days past due in addition.
Lessee shall pay to Lessor any actual additional expenses incurred by Lessor
in collection efforts, including but not limited to long-distance telephone
charges and travel expenses.  Lessee shall pay to Lessor interest on any
delinquent payment or amount due under this Lease from the due date thereof
until paid, at the lesser of the maximum rate of interest allowed by law or
18% per annum.

20.  TIME OF ESSENCE.  Time is of the essence of this Lease, and this
provision shall not be impliedly waived by the acceptance on occasion of late
or defective performance.

21.  DEFAULT.  Lessee shall be in default if:

(a) Lessee shall fail to make any payment due under the terms of this Lease
for a period of 10 days from the due date thereof; or
(b) Lessee shall fail to observe, keep, or perform any provision of this
Lease, and such failure shall continue for a period of 10 days; or
(c) Lessee has made any misleading or false statement in connection with
application for or performance of this Lease; or
(d) The Equipment of any part thereof shall be subject to any lien, levy,
seizure, assignment, transfer, bulk transfer, encumbrance, application,
attachment, execution, sublease or sale without prior written consent of
Lessor, or if Lessee shall abandon the Equipment or permit any other entity or
person to use the Equipment without the prior written consent of Lessor; or
(e) Lessee dies or ceases to exist; or
(f) Lessee defaults on any other agreement it has with Lessor; or
(g) Any guarantor of this Lease defaults on any obligation to Lessor or any of
the above listed events of default occur with respect to any guarantor or any
such guarantor files or has filed against it a petition under the bankruptcy
laws.

22.  REMEDIES.  If Lessee is in default, Lessor, with or without notice to
Lessee, shall have the right to exercise any one or more of the following
remedies, concurrently or separately, and without any election of remedies
being deemed to have been made:

(a) Lessor may enter upon Lessee's priorities and without any court order or
other process of law may repossess and remove the Equipment or render the
Equipment unusable without removal, either with or without notice to Lessee.
Lessee hereby waives any trespass or right of action for damages by reason of
such entry, removal or.  Any such repossession shall not constitute a
termination of this Lease unless Lessor so notifies Lessee in writing;
(b) Lessor may require Lessee, at its expense, to return the Equipment in good
repair, ordinary wear and tear resulting from proper use thereof alone
excepted, by delivering it, paced and ready for shipment, to such place as
Lessor may specify.
(c) Lessor may cancel or terminate this Lease and may retain any and all prior
payments paid by Lessee;
(d) Lessor may declare all sums due and to become due under this Lease
immediately due and payable, including as to any or all items of Equipment,
without notice or demand to Lessee;
(e) Lessor may re-lease the Equipment without notice to Lessee, to any third
party, upon such terms and conditions as Lessor alone shall determine, or may
sell the Equipment, without notice to Lessee, at private or public sale, at
which sale Lessor may be the purchaser;
(f) Lessor may sue for an recover from Lessee the sum of all unpaid rents and
other payments due under this Lease then accrued, all accelerated future
payments due under this Lease, discounted to their present value at a discount
rate of 9% as of the date of default, plus Lessor's estimate at the time this
Lease was entered into of Lessor's residual interest in the Equipment, reduced
to present value at a discount rate of 9% as of the date of default, less the
net proceeds of disposition, if any, of the Equipment;
(g) To pursue any other remedy available at law, by statute or in equity.

No right or remedy herein conferred upon or reserved to Lessor is exclusive of
any other right or remedy herein, or by law or by equity provided or
permitted, but each shall be cumulative of every other right or remedy given
herein or now or hereafter existing by law or equity or by statute or
otherwise, and may be enforced concurrently therewith or from time to time.
No single or partial exercise by Lessor of any right or remedy hereunder shall
preclude any other or further exercise or any other right or remedy.

23.  MULTIPLE LESSEES.  Lessor may, with the consent of any one of the Lessees
hereunder, modify, extend, or change any of the terms hereof without consent
or knowledge of the others, without in any way releasing, waiving or impairing
any right granted to Lessor against the others.  Lessees and each of them are
jointly and severally responsible and liable to Lessor under this Lease.

24.  EXPENSE OF ENFORCEMENT.  In the event of any legal action with respect to
the Lease, the prevailing party in any such action shall be entitled to
reasonable attorney fees, including attorney fees incurred at the trial level,
including action in bankruptcy court, on appeal or review or incurred without
action, suits or proceedings, together with all costs and expenses incurred in
pursuit thereof.

25.  ENTIRE AGREEMENT; NO ORAL MODIFICATIONS; NO WAIVER.  This instrument
constitutes the entire agreement between Lessor and Lessee.  No provision of
this Lease shall be modified or rescinded unless in writing signed by a
representative of Lessor.  Waiver by Lessor of any provision hereof in the
instance shall not constitute a waiver in any other instance.

26.  SEVERABILITY.  This Lease is intended to constitute a valid and
enforceable legal instrument and no provision of this Lease that may be deemed
unenforceable shall in any way invalidate any other provision herein, all of
which shall remain in full force and effect.

LESSOR                                LEASE NUMBER
       ------------------                          ---------------------

LESSEE                                DATE OF LEASE
       ------------------                          ---------------------

                   ACKNOWLEDGEMENT AND ACCEPTANCE
                      OF EQUIPMENT BY LESSEE

Lessee hereby acknowledges that the Equipment described above has been
received in good condition and repair, has been properly installed, tested,
and inspected, and is operating satisfactorily in all respects for all of
Lessee's intended uses and purposes.  Lessee hereby accepts unconditionally
and irrevocably the Equipment.

By signature below, Lessee specifically authorizes and requests Lessor to make
payment to the supplier of the Equipment.  Lessee agrees that said Equipment
has not been delivered, installed, or accepted on a trial basis.

WITH THE DELIVERY OF THIS DOCUMENT TO LESSOR, LESSEE ACKNOWLEDGES AND AGREES
THAT LESSEE'S OBLIGATIONS TO LESSOR BECOME ABSOLUTE AND IRREVOCABLE AND LESSEE
SHALL BE FOREVER ESTOPPED FROM DENYING THE TRUTHFULNESS OF THE REPRESENTATIONS
MADE IN THIS DOCUMENT.

DATE OF ACCEPTANCE:                      LESSEE:
                   ----------------             -----------------

IMPORTANT: THIS DOCUMENT HAS LEGAL AND FINANCIAL CONSEQUENCES TO YOU.  DO NOT
SIGN THIS DOCUMENT UNTIL YOU HAVE ACTUALLY RECEIVED ALL OF THE EQUIPMENT AND
ARE COMPLETELY SATISFIED WITH IT.

I HEREBY AUTHORIZE ______________ TO ORALLY VERIFY MY/OUR ACCEPTANCE OF THE
ABOVE REFERENCED EQUIPMENT IN MY ABSENCE.<PAGE>

                                                                     EXHIBIT 4.1

                          TELCOM SEMICONDUCTOR, INC.
                      2000 NONSTATUTORY STOCK OPTION PLAN

                         (as amended October 17, 2000)

     1. Purposes of the Plan. The purposes of this Nonstatutory Stock Option
        --------------------
Plan are:

          . to attract and retain the best available personnel for positions of
            substantial responsibility,

          . to provide additional incentive to Employees and Consultants, and

          . to promote the success of the Company's business.

          Options granted under the Plan will be Nonstatutory Stock Options.

     2. Definitions. As used herein, the following definitions shall apply:
        -----------

          (a) "Administrator" means the Board or any of its Committees as shall
               -------------
be administering the Plan, in accordance with Section 4 of the Plan.

          (b) "Applicable Laws" means the requirements relating to the
               ---------------
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws of
any foreign country or jurisdiction where Options are, or will be, granted under
the Plan.

          (c) "Board" means the Board of Directors of the Company.
               -----

          (d) "Code" means the Internal Revenue Code of 1986, as amended.
               ----

          (e) "Committee" means a committee of Directors appointed by the Board
               ---------
in accordance with Section 4 of the Plan.

          (f) "Common Stock" means the Common Stock of the Company.
               ------------

          (g) "Company" means TelCom Semiconductor, Inc., a Delaware
               -------
corporation.

          (h) "Consultant" means any person, including an advisor, engaged by
               ----------
the Company or a Parent or Subsidiary to render services to such entity.

          (i) "Director" means a member of the Board.
               --------
<PAGE>

          (j) "Disability" means total and permanent disability as defined in
               ----------
Section 22(e)(3) of the Code.

          (k) "Employee" means any person, including Officers, employed by the
               --------
Company or any Parent or Subsidiary of the Company. A person shall not cease to
be an Employee in the case of (i) any leave of absence approved by the Company
or (ii) transfers between locations of the Company or between the Company, its
Parent, any Subsidiary, or any successor. Neither service as a Director nor
payment of a director's fee by the Company shall be sufficient to constitute
"employment" by the Company.

          (l) "Exchange Act" means the Securities Exchange Act of 1934, as
               ------------
amended.

          (m) "Fair Market Value" means, as of any date, the value of Common
               -----------------
Stock determined as follows:

                 (i)   If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the National
Market of the National Association of Securities Dealers, Inc. Automated
Quotation ("NASDAQ") System, its Fair Market Value shall be the closing sales
price for such stock (or the closing bid, if no sales were reported) as quoted
on such exchange or system for the last market trading day prior to the time of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable;

                 (ii)  If the Common Stock is quoted on the NASDAQ System (but
not on the National Market thereof) or regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the high bid and low asked prices for the Common Stock
or;

                 (iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.

          (n) "Notice of Grant" means a written or electronic notice evidencing
               ---------------
certain terms and conditions of an individual Option grant. The Notice of Grant
is part of the Option Agreement.

          (o) "Officer" means a person who is an officer of the Company within
               -------
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

          (p) "Option" means a nonstatutory stock option granted pursuant to the
               ------
Plan, that is not intended to qualify as an incentive stock option within the
meaning of Section 422 of the Code and the regulations promulgated thereunder.

          (q) "Option Agreement" means an agreement between the Company and an
               ----------------
Optionee evidencing the terms and conditions of an individual Option grant. The
Option Agreement is subject to the terms and conditions of the Plan.

                                      -2-
<PAGE>

          (r) "Option Exchange Program" means a program whereby outstanding
               -----------------------
options are surrendered in exchange for options with a lower exercise price.

          (s) "Optioned Stock" means the Common Stock subject to an Option.
               --------------

          (t) "Optionee" means the holder of an outstanding Option granted under
               --------
the Plan.

          (u) "Parent" means a "parent corporation," whether now or hereafter
               ------
existing, as defined in Section 424(e) of the Code.

          (v) "Plan" means this 2000 Nonstatutory Stock Option Plan.
               ----

          (w) "Share" means a share of the Common Stock, as adjusted in
               -----
accordance with Section 12 of the Plan.

          (x) "Subsidiary" means a "subsidiary corporation," whether now or
               ----------
hereafter existing, as defined in Section 424(f) of the Code.

     3. Stock Subject to the Plan. Subject to the provisions of Section 12 of
        -------------------------
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is One Million Seven Hundred Thousand (1,700,000) Shares. The
Shares may be authorized, but unissued, or reacquired Common Stock.

          If an Option expires or becomes unexercisable without having been
exercised in full, or is surrendered pursuant to an Option Exchange Program, the
unpurchased Shares which were subject thereto shall become available for future
grant or sale under the Plan (unless the Plan has terminated).

     4. Administration of the Plan.
        --------------------------

          (a) Administration. The Plan shall be administered by (i) the Board or
              --------------
(ii) a Committee, which committee shall be constituted to satisfy Applicable
Laws.

          (b) Powers of the Administrator. Subject to the provisions of the
              ---------------------------
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:

                (i)   to determine the Fair Market Value of the Common Stock;

                (ii)  to select the Employees and Consultants to whom Options
may be granted hereunder;

                (iii) to determine whether and to what extent Options are
granted hereunder;

                                      -3-
<PAGE>

                (iv)   to determine the number of shares of Common Stock to be
covered by each Option granted hereunder;

                (v)    to approve forms of agreement for use under the Plan;

                (vi)   to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any award granted hereunder. Such terms and
conditions include, but are not limited to, the exercise price, the time or
times when Options may be exercised (which may be based on performance
criteria), any vesting acceleration or waiver of forfeiture restrictions, and
any restriction or limitation regarding any Option or the shares of Common Stock
relating thereto, based in each case on such factors as the Administrator, in
its sole discretion, shall determine;

                (vii)  to institute an Option Exchange Program with approval by
the Board of Directors;

                (viii) to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan;

                (ix)   to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws;

                (x)    to modify or amend each Option (subject to Section 14(b)
of the Plan), including the discretionary authority to extend the post-
termination exercisability period of Options longer than is otherwise provided
for in the Plan;

                (xi)   to authorize any person to execute on behalf of the
Company any instrument required to effect the grant of an Option previously
granted by the Administrator;

                (xii)  to determine the terms and restrictions applicable to
Options;

                (xiii) to allow Optionees to satisfy withholding tax obligations
by electing to have the Company withhold from the Shares to be issued upon
exercise of an Option that number of Shares having a Fair Market Value equal to
the amount required to be withheld. The Fair Market Value of the Shares to be
withheld shall be determined on the date that the amount of tax to be withheld
is to be determined. All elections by an Optionee to have Shares withheld for
this purpose shall be made in such form and under such conditions as the
Administrator may deem necessary or advisable; and

                (xiv)  to make all other determinations deemed necessary or
advisable for administering the Plan.

          (c) Effect of Administrator's Decision. The Administrator's decisions,
              ----------------------------------
determinations and interpretations shall be final and binding on all Optionees
and any other holders of Options.

                                      -4-
<PAGE>

     5. Eligibility. Options may be granted to Employees and Consultants;
        -----------
provided, however, that notwithstanding anything to the contrary contained in
the Plan, Options may not be granted to Officers and Directors.

     6. Limitation. Neither the Plan nor any Option shall confer upon an
        ----------
Optionee any right with respect to continuing the Optionee's relationship as an
Employee or Consultant with the Company, nor shall they interfere in any way
with the Optionee's right or the Company's right to terminate such relationship
at any time, with or without cause.

     7. Term of Plan. The Plan shall become effective upon its adoption by the
        ------------
Board. It shall continue in effect for ten (10) years, unless sooner terminated
under Section 14 of the Plan.

     8. Term of Option. The term of each Option shall be stated in the Option
        --------------
Agreement.

     9. Option Exercise Price and Consideration.
        ---------------------------------------

           (a) Exercise Price. The per share exercise price for the Shares to be
               --------------
issued pursuant to exercise of an Option shall be determined by the
Administrator.

           (b) Waiting Period and Exercise Dates. At the time an Option is
               ---------------------------------
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions which must be satisfied before the
Option may be exercised.

           (c) Form of Consideration. The Administrator shall determine the
               ---------------------
acceptable form of consideration for exercising an Option, including the method
of payment. Such consideration may consist entirely of:

                 (i)   cash;

                 (ii)  check;

                 (iii) promissory note;

                 (iv)  other Shares which (A) in the case of Shares acquired
upon exercise of an option, either have been owned by the Optionee for more than
six months on the date of surrender or were not acquired, directly or
indirectly, from the Company, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised;

                 (v)   authorization from the Company to retain from the total
number of Shares as to which the Option is exercised that number of Shares
having a Fair Market Value on the date of exercise equal to the exercise price
for the total number of Shares as to which the Option is exercised;

                                      -5-
<PAGE>

                 (vi)   delivery of a properly executed exercise notice together
with irrevocable instructions to a broker to promptly deliver to the Company the
amount of sale or loan proceeds required to pay the exercise price;

                 (vii)  such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws; or

                 (viii) any combination of the foregoing methods of payment.

     10. Exercise of Option.
         ------------------

           (a) Procedure for Exercise; Rights as a Stockholder. Any Option
               -----------------------------------------------
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement. An Option may not be exercised for a fraction of
a Share.

                 An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a stockholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a dividend or other right
for which the record date is prior to the date the Shares are issued, except as
provided in Section 12 of the Plan.

                 Exercising an Option in any manner shall decrease the number of
Shares thereafter available, both for purposes of the Plan and for sale under
the Option, by the number of Shares as to which the Option is exercised.

           (b) Termination of Relationship as an Employee or Consultant. If an
               --------------------------------------------------------
Optionee ceases to be an Employee or Consultant, other than upon the Optionee's
death or Disability, the Optionee may exercise his or her Option, but only
within thirty (30) days (or such longer period of time as is determined by the
Board, with such time not exceeding ninety (90) days), and only to the extent
that the Option is vested on the date of termination (but in no event later than
the expiration of the term of such Option as set forth in the Option Agreement).
If, on the date of termination, the Optionee is not vested as to his or her
entire Option, the Shares covered by the unvested portion of the Option shall
revert to the Plan. If, after termination, the Optionee does not exercise his or
her Option within the time specified by the Administrator, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

                                      -6-
<PAGE>

           (c) Disability of Optionee. If an Optionee ceases to be an Employee
               ----------------------
or Consultant as a result of the Optionee's Disability, the Optionee may
exercise his or her Option within such period of time as is specified in the
Option Agreement, to the extent the Option is vested on the date of termination
(but in no event later than the expiration of the term of such Option as set
forth in the Option Agreement). In the absence of a specified time in the Option
Agreement, the Option shall remain exercisable for one (1) month following the
Optionee's termination. If, on the date of termination, the Optionee is not
vested as to his or her entire Option, the Shares covered by the unvested
portion of the Option shall revert to the Plan. If, after termination, the
Optionee does not exercise his or her Option within the time specified herein,
the Option shall terminate, and the Shares covered by such Option shall revert
to the Plan.

           (d) Death of Optionee. If an Optionee dies while an Employee or
               -----------------
Consultant, the Option may be exercised within such period of time as is
specified in the Option Agreement (but in no event later than the expiration of
the term of such Option as set forth in the Notice of Grant), by the Optionee's
estate or by a person who acquires the right to exercise the Option by bequest
or inheritance, but only to the extent that the Option is vested on the date of
death. In the absence of a specified time in the Option Agreement, the Option
shall remain exercisable for six (6) months following the Optionee's
termination. If, at the time of death, the Optionee is not vested as to his or
her entire Option, the Shares covered by the unvested portion of the Option
shall immediately revert to the Plan. The Option may be exercised by the
executor or administrator of the Optionee's estate or, if none, by the person(s)
entitled to exercise the Option under the Optionee's will or the laws of descent
or distribution. If the Option is not so exercised within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

           (e) Buyout Provisions. The Administrator may at any time offer to buy
               -----------------
out for a payment in cash or Shares, an Option previously granted based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.

     11. Non-Transferability of Options. Unless determined otherwise by the
         ------------------------------
Administrator, an Option may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee. If the Administrator makes an Option
transferable, such Option shall contain such additional terms and conditions as
the Administrator deems appropriate.

     12. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
         ------------------------------------------------------------------
Asset Sale.
----------

           (a) Changes in Capitalization. Subject to any required action by the
               -------------------------
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Options have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Option, as well as the price per share of Common Stock covered
by each such outstanding Option, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in

                                      -7-
<PAGE>

the number of issued shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option.

           (b) Dissolution or Liquidation. In the event of the proposed
               --------------------------
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator shall notify the Optionee at least fifteen (15)
days prior to such proposed action. To the extent it has not been previously
exercised, an Option will terminate immediately prior to the consummation of
such proposed action.

           (c) Merger or Asset Sale. In the event of a merger of the Company
               --------------------
with or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Option shall be assumed or an equivalent option
or right substituted by the successor corporation or a Parent or Subsidiary of
the successor corporation. In the event that the successor corporation does not
agree to assume the Option or substitute an equivalent option, the Option shall
terminate.

     13. Date of Grant. The date of grant of an Option shall be, for all
         -------------
purposes, the date on which the Administrator makes the determination granting
such Option, or such other later date as is determined by the Administrator.
Notice of the determination shall be provided to each Optionee within a
reasonable time after the date of such grant.

     14. Amendment and Termination of the Plan.
         -------------------------------------

           (a) Amendment and Termination. The Board may at any time amend,
               -------------------------
alter, suspend or terminate the Plan.

           (b) Effect of Amendment or Termination. No amendment, alteration,
               ----------------------------------
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to options granted under the
Plan prior to the date of such termination.

     15. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant
         ----------------------------------
to the exercise of an Option unless the exercise of such Option and the issuance
and delivery of such Shares shall comply with Applicable Laws and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

     16. Inability to Obtain Authority. The inability of the Company to obtain
         -----------------------------
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company's counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any

                                      -8-
<PAGE>

liability in respect of the failure to issue or sell such Shares as to which
such requisite authority shall not have been obtained.

     17. Reservation of Shares. The Company, during the term of this Plan, will
         ---------------------
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

                                      -9-
<PAGE>

                                    FORM OF

                          TELCOM SEMICONDUCTOR, INC.

                      2000 NONSTATUTORY STOCK OPTION PLAN

                            STOCK OPTION AGREEMENT

        Unless otherwise defined herein, the terms defined in the Plan shall
have the same defined meanings in this Option Agreement.

I.      NOTICE OF STOCK OPTION GRANT
        ----------------------------

        [Optionee's Name and Address]

        You have been granted an option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as
follows:

        Grant Number                      __________________________

        Date of Grant                     __________________________

        Vesting Commencement Date         __________________________

        Exercise Price per Share          $_________________________

        Total Number of Shares Granted    __________________________

        Total Exercise Price              $_________________________

        Type of Option:                   Nonstatutory Stock Option

        Term/Expiration Date:             __________________________

        Vesting Schedule:
        ----------------

        Subject to the Optionee continuing to be an Employee or Consultant on
such dates, this Option shall vest and become exercisable in accordance with the
following schedule:

         [25% of the Shares subject to the Option shall vest twelve months after
the Vesting Commencement Date, and 1/48th of the Shares subject to the Option
shall vest upon the last day of each month thereafter.]
<PAGE>

         Termination Period:
         ------------------

         This Option may be exercised for 30 days after Optionee ceases to be an
Employee or Consultant. Upon the death or Disability of the Optionee, this
Option may be exercised for such longer period as provided in the Plan. In no
event shall this Option be exercised later than the Term/Expiration Date as
provided above.

II.      AGREEMENT
         ---------

         1. Grant of Option. The Plan Administrator of the Company hereby grants
            ---------------
to the Optionee named in the Notice of Grant attached as Part I of this
Agreement (the "Optionee") an option (the "Option") to purchase the number of
Shares, as set forth in the Notice of Grant, at the exercise price per share set
forth in the Notice of Grant (the "Exercise Price"), subject to the terms and
conditions of the Plan, which is incorporated herein by reference. Subject to
Section 14(b) of the Plan, in the event of a conflict between the terms and
conditions of the Plan and the terms and conditions of this Option Agreement,
the terms and conditions of the Plan shall prevail.

         2. Exercise of Option.
            ------------------

            (a) Right to Exercise. This Option is exercisable during its term in
                -----------------
accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Option Agreement.

            (b) Method of Exercise. This Option is exercisable by delivery of an
                ------------------
exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to Corporate Controller. The Exercise Notice shall
be accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares. This Option shall be deemed to be exercised upon receipt by the Company
of such fully executed Exercise Notice accompanied by such aggregate Exercise
Price.

            No Shares shall be issued pursuant to the exercise of this Option
unless such issuance and exercise complies with Applicable Laws. Assuming such
compliance, for income tax purposes the Exercised Shares shall be considered
transferred to the Optionee on the date the Option is exercised with respect to
such Exercised Shares.

         3. Method of Payment. Payment of the aggregate Exercise Price shall be
            -----------------
by any of the following, or a combination thereof, at the election of the
Optionee:

            (a) cash;

            (b) check;

                                      -2-
<PAGE>

            (c) consideration received by the Company under a cashless exercise
program implemented by the Company in connection with the Plan; or

            (d) surrender of other Shares which (i) in the case of Shares
acquired upon exercise of an option, have been owned by the Optionee for more
than six (6) months on the date of surrender, and (ii) have a Fair Market Value
on the date of surrender equal to the aggregate Exercise Price of the Exercised
Shares.

         4. Non-Transferability of Option. This Option may not be transferred in
            -----------------------------
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of Optionee only by the Optionee. The terms
of the Plan and this Option Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.

         5. Term of Option. This Option may be exercised only within the term
            --------------
set out in the Notice of Grant, and may be exercised during such term only in
accordance with the Plan and the terms of this Option Agreement.

         6. Tax Consequences. Some of the federal tax consequences relating to
            ----------------
this Option, as of the date of this Option, are set forth below. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES.

            (a) Exercising the Option. The Optionee may incur regular federal
                ---------------------
income tax liability upon exercise of an NSO. The Optionee will be treated as
having received compensation income (taxable at ordinary income tax rates) equal
to the excess, if any, of the Fair Market Value of the Exercised Shares on the
date of exercise over their aggregate Exercise Price. If the Optionee is an
Employee or a former Employee, the Company will be required to withhold from his
or her compensation or collect from Optionee and pay to the applicable taxing
authorities an amount in cash equal to a percentage of this compensation income
at the time of exercise, and may refuse to honor the exercise and refuse to
deliver Shares if such withholding amounts are not delivered at the time of
exercise.

            (b) Disposition of Shares. If the Optionee holds NSO Shares for at
                ---------------------
least one year, any gain realized on disposition of the Shares will be treated
as long-term capital gain for federal income tax purposes.

         7. Entire Agreement; Governing Law. The Plan is incorporated herein by
            -------------------------------
reference. The Plan and this Option Agreement constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee's interest except by means of a writing signed by the Company and
Optionee. This agreement is governed by the internal substantive laws, but not
the choice of law rules, of California.

                                      -3-
<PAGE>

         8. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES
            ---------------------------------
THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED
ONLY BY CONTINUING AS AN EMPLOYEE OR CONSULTANT AT THE WILL OF THE COMPANY (AND
NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES
HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO
NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS AN
EMPLOYEE OR CONSULTANT FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND
SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE
OPTIONEE'S RELATIONSHIP AS AN EMPLOYEE OR CONSULTANT AT ANY TIME, WITH OR
WITHOUT CAUSE.

         By your signature and the signature of the Company's representative
below, you and the Company agree that this Option is granted under and governed
by the terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator upon any questions relating to the Plan
and Option Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated below.

OPTIONEE                                  TELCOM SEMICONDUCTOR, INC.

____________________________________      _____________________________________
Signature                                 By

____________________________________      _____________________________________
Print Name                                Title

____________________________________
Residence Address

____________________________________

                                      -4-
<PAGE>

                                   EXHIBIT A
                                   ---------

                                   [FORM OF]

                          TELCOM SEMICONDUCTOR, INC.

                      2000 NONSTATUTORY STOCK OPTION PLAN

                                EXERCISE NOTICE

TelCom Semiconductor, Inc.
1300 Terra Bella Avenue
Mountain View, CA 94039

Attention: Corporate Controller

     1. Exercise of Option. Effective as of today, ________________, _____, the
        ------------------
undersigned ("Purchaser") hereby elects to purchase ______________ shares (the
"Shares") of the Common Stock of TelCom Semiconductor, Inc. (the "Company")
under and pursuant to the 2000 Nonstatutory Stock Option Plan (the "Plan") and
the Stock Option Agreement dated, _________, ___ (the "Option Agreement"). The
purchase price for the Shares shall be $, as required by the Option Agreement.

     2. Delivery of Payment. Purchaser herewith delivers to the Company the full
        -------------------
purchase price for the Shares.

     3. Representations of Purchaser. Purchaser acknowledges that Purchaser has
        ----------------------------
received, read and understood the Plan and the Option Agreement and agrees to
abide by and be bound by their terms and conditions.

     4. Rights as Stockholder. Until the issuance (as evidenced by the
        ---------------------
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a stockholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 12 of the
Plan.

     5. Tax Consultation. Purchaser understands that Purchaser may suffer
        ----------------
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.
<PAGE>

     6. Entire Agreement; Governing Law. The Plan and Option Agreement are
        -------------------------------
incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser's interest except by
means of a writing signed by the Company and Purchaser. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.

Submitted by:                       Accepted by:

PURCHASER                           TELCOM SEMICONDUCTOR, INC.

_______________________________     _______________________________
Signature                           By

_______________________________     _______________________________
Print Name                          Title

                                    _______________________________
                                    Date Received

Address:                            Address:
-------  ______________________     -------  ______________________

         ______________________              ______________________

         ______________________              ______________________

                                      -2-

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