Document:

ASSET PURCHASE AGREEMENT

by
and among

QUALCOMM
INCORPORATED

as
Purchaser,

RF MICRO DEVICES,
INC.

as
Parent,

and

RFMD WPAN, INC.

as
Seller

Dated as of December 1, 2006

TABLE OF CONTENTS

                                                                                                                                             Page

ARTICLE I....... PURCHASE AND SALE OF ASSETS;  ASSUMPTION
OF

                         
LIABILITIES.............................................................................................
1

Section 1.1............ Sale and Transfer of Assets and
Assumptions of Liabilities................... 1

Section 1.2............ The Purchase Price.................................................................................
2

Section 1.3............ Assumption of Liabilities.......................................................................
2

Section 1.4............ Liabilities Not
Assumed.........................................................................
2

ARTICLE II...... THE
CLOSING......................................................................................    3

Section 2.1............ The Closing............................................................................................ 3

ARTICLE III...... REPRESENTATIONS AND WARRANTIES OF THE PARENT

                           AND THE SELLER...............................................................................   3

Section 3.1............ Authorization.......................................................................................... 3

Section 3.2............ Binding Agreement................................................................................. 4

Section 3.3............ Good Title Conveyed............................................................................. 4

Section 3.4............ Organization; Qualification of Parent
and the Seller............................... 4

Section 3.5............ Consents and Approvals; No Violations.................................................. 4

Section 3.6............ Governmental Authorization.................................................................... 5

Section 3.7............ Restrictions on Business Activities........................................................... 5

Section 3.8............ Financial Information.............................................................................. 5

Section 3.9............ Books and Records................................................................................ 5

Section 3.10.......... Accounts Receivable.............................................................................. 5

Section 3.11.......... Disputed Accounts Payable.................................................................... 6

Section 3.12.......... Inventory................................................................................................ 6

Section 3.13.......... Equipment Held by Suppliers.................................................................. 6

Section 3.14.......... Goods Held on Consignment.................................................................. 6

Section 3.15.......... Absence of Certain Changes................................................................... 6

Section 3.16.......... Title to Properties; Encumbrances........................................................... 8

Section 3.17.......... Real Property......................................................................................... 8

Section 3.18.......... Leases................................................................................................... 8

Section 3.19.......... Equipment.............................................................................................. 8

Section 3.20.......... Environmental Matters............................................................................ 8

Section 3.21.......... Contracts and Commitments................................................................... 9

Section 3.22.......... Customers and Suppliers...................................................................... 10

Section 3.23.......... Insurance............................................................................................. 10

Section 3.24.......... Casualties............................................................................................. 11

Section 3.25.......... Litigation.............................................................................................. 11

Section 3.26.......... Compliance with Laws......................................................................... 11

Section 3.27.......... Tax Matters......................................................................................... 11

Section 3.28.......... Employee Benefit Plans........................................................................ 13

Section 3.29.......... Intellectual Property.............................................................................. 13

Section 3.30.......... Labor Matters...................................................................................... 21

Section 3.31.......... Personnel............................................................................................. 23

Section 3.32.......... Potential Conflict of Interest.................................................................. 23

i

TABLE OF CONTENTS

(continued)

                                                                                                                                          Page

Section 3.33.......... Propriety of Past Payments................................................................... 23

Section 3.34.......... Product Liability................................................................................... 24

Section 3.35.......... Brokers or Finders............................................................................... 24

Section 3.36.......... Full
Disclosure...................................................................................... 24

ARTICLE IV...... REPRESENTATIONS AND WARRANTIES  OF PURCHASER.... 24

Section 4.1............ Organization......................................................................................... 24

Section 4.2............ Authorization........................................................................................ 24

Section 4.3............ Binding Agreement............................................................................... 25

Section 4.4............ Consents and Approvals; No Violations................................................ 25

Section 4.5............ Brokers or
Finders............................................................................... 25

ARTICLE V....... COVENANTS....................................................................................... 25

Section 5.1............ Interim Operations of the Seller............................................................. 25

Section 5.2............ Access, Confidentiality......................................................................... 28

Section 5.3............ Efforts and Actions to Cause Closing
to Occur...................................... 29

Section 5.4............ Notification of Certain Matters.............................................................. 30

Section 5.5............ No Solicitation of Competing
Transaction............................................. 31

Section 5.6............ Hiring by Purchaser.............................................................................. 32

Section 5.7............ No Assumption of Labor Liabilities....................................................... 32

Section 5.8............ Seller's Non-Compete......................................................................... 32

Section 5.9............ Subsequent Actions.............................................................................. 32

Section 5.10.......... Publicity............................................................................................... 33

Section 5.11.......... Mail Received After Closing................................................................. 33

Section 5.12.......... Access to Books and Records.............................................................. 34

Section 5.13.......... Consignment Assets............................................................................. 34

Section 5.14.......... Waiver of Bulk Sales Requirement........................................................ 34

Section 5.15.......... Accounts Receivable............................................................................ 34

Section 5.16.......... Preparation and Filing of Tax Returns;
Payment of Taxes.................... 35

Section 5.17.......... Seller Facility........................................................................................ 35

Section 5.18.......... Purchase Price Allocation..................................................................... 35

Section 5.19.......... Financial Information............................................................................ 36

Section 5.20.......... Retained Know-How Rights................................................................. 36

Section 5.21.......... Additional
Proprietary Rights................................................................ 36

ARTICLE VI...... CONDITIONS...................................................................................... 36

Section 6.1............ Conditions to Each Party's Obligation
to Effect the Closing................... 36

Section 6.2............ Conditions to Obligations of Purchaser
to Effect the Closing.................. 37

Section 6.3............ Conditions
to Obligations of Parent and the Seller................................. 40

ARTICLE VII..... TERMINATION................................................................................... 41

Section 7.1............ Termination.......................................................................................... 41

Section 7.2............ Effect of
Termination............................................................................ 42

ii

TABLE OF CONTENTS

(continued)

 

                                                                                                                                         Page

ARTICLE VIII.... INDEMNIFICATION.......................................................................... 42

Section 8.1............ Indemnification; Remedies.................................................................... 42

Section 8.2............ Indemnification Holdback..................................................................... 43

Section 8.3............ Claims Upon Indemnification Holdback................................................ 44

Section 8.4............ Objections to Claims............................................................................ 44

Section 8.5............ Resolution of Conflicts.......................................................................... 44

Section 8.6............ Third-Party Claims............................................................................... 44

Section 8.7............ Survival of Indemnification Claims......................................................... 45

Section 8.8............ Tax Effect of Indemnification Payments................................................. 45

Section 8.9............ Effect of Investigation........................................................................... 45

Section 8.10.......... Survival of
Covenants, Representations and Warranties......................... 45

ARTICLE IX...... DEFINITIONS AND INTERPRETATION.......................................... 46

Section 9.1............ Definitions............................................................................................ 46

Section 9.2............ Interpretation........................................................................................ 55

ARTICLE X....... MISCELLANEOUS.............................................................................. 56

Section 10.1.......... Fees and Expenses............................................................................... 56

Section 10.2.......... Amendment and Modification............................................................... 56

Section 10.3.......... Notices................................................................................................ 56

Section 10.4.......... Counterparts........................................................................................ 57

Section 10.5.......... Entire Agreement; No Third Party
Beneficiaries..................................... 57

Section 10.6.......... Severability.......................................................................................... 57

Section 10.7.......... Governing Law; Venue......................................................................... 58

Section 10.8.......... Time of Essence................................................................................... 58

Section 10.9.......... Extension; Waiver................................................................................ 58

Section 10.10........ Election of Remedies............................................................................ 58

Section 10.11........ Assignment........................................................................................... 58

iii

EXHIBITS
AND SCHEDULES

Exhibit A     -     Form of Joint Defense Agreement

Exhibit B     -     Form of Agreement Regarding Certain
Indemnity Claims

Exhibit C     -     Retained Know-How Rights

Exhibit D     -     Form of Legal Opinion

Exhibit E      -     Form of Patent Assignment

Exhibit F      -     Form of Trademark Assignment

Exhibit G     -     Assumption Agreement

Exhibit H     -     Bill
of Sale

Disclosure Schedule

Schedule 5.6                -  Excluded Employees

Schedule 6.2(j)             -  Required Amendments

Schedule 9.1(A)           -  Assets

Schedule 9.1(B)           -  Assumed Contracts

Schedule 9.1(C)           -  Financial Information

Schedule 9.1(D)           -  Required Contract Consents

Schedule 9.1(E)            -  Excluded Assets

Schedule 9.1(F)            -  Excluded Business

Schedule G                   -  Assumed Liabilities

Schedule H-1               -  Assets

iv

ASSET
PURCHASE AGREEMENT

This Asset
Purchase Agreement is made and entered into as of December 1, 2006, by and
among QUALCOMM Incorporated, a Delaware corporation, RFMD WPAN, Inc., a Delaware
corporation, and RF Micro Devices, Inc., a North Carolina corporation, relating
to the sale of the Assets and the business as a going concern heretofore
conducted by Seller as a wholly-owned subsidiary of Parent.  Certain
capitalized terms used in this Agreement have the meaning assigned to them in
Article IX.

WHEREAS, each
of Purchaser, Parent and Seller has received requisite approval and deems it
advisable and in the best interests of their respective companies and the
stockholders of their respective companies that the Parent (solely with respect
to the Seller and the Assets) and the Seller sell, assign, transfer and convey
to Purchaser, and that Purchaser purchase from Parent (solely with respect to
the Seller and the Assets) and the Seller, the Assets in exchange for cash and
the assumption of the Assumed Liabilities, all according to the terms and
subject to the conditions set forth in this Agreement.

NOW,
THEREFORE, in consideration of the foregoing and the mutual representations,
warranties, covenants and agreements set forth herein, intending to be legally
bound hereby, the parties hereto agree as follows:

ARTICLE I

PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES

Section 1.1             
Sale and Transfer of Assets and Assumption of Liabilities.

            (a)               
Upon the terms and subject to the conditions set forth in this
Agreement, effective as of the Closing:

                        (i)                
the Parent and the Seller agree to sell, assign, transfer, convey and
deliver to Purchaser, and Purchaser agrees to purchase from the Parent and
Seller, all of Parent's and the Seller's right, title and interest in and to
the Assets, free and clear of all Encumbrances except (A) Permitted
Encumbrances, (B) Encumbrances disclosed in this Agreement or the Disclosure
Schedule, (C) the Assumed Liabilities, and (D) the Retained Know-How Rights;
and

                        (ii)               
the Parent and the Seller agree to assign to Purchaser and Purchaser
shall assume from the Parent and the Seller, all of the Parent's and the
Seller's rights and obligations under the Assumed Contracts, subject to the
obtaining of all necessary consents by the other parties thereto.

1

In connection with the
transactions contemplated herein, on the Closing Date, the Parent and the
Seller shall take (and shall cause their respective Affiliates to take) any and
all actions that may be required, or reasonably requested by Purchaser, to
transfer good and marketable title to all of the Assets free and clear of all
Encumbrances (except Permitted Encumbrances, Encumbrances disclosed in this
Agreement or the Disclosure Schedule, Assumed Liabilities and the Retained Know-How
Rights) to Purchaser.  Parent and the Seller shall deliver possession of all of
the Assets to Purchaser on or as soon as practicable after the Closing Date at
Seller's principal place of business and by such means as are reasonably
designated by Purchaser, and Parent and the Seller shall further deliver to
Purchaser proper assignments, bills of sale, conveyances and other instruments
of sale and/or transfer in forms reasonably satisfactory to Purchaser in order
to convey to Purchaser good and marketable title to all Assets, free and clear
of all Encumbrances (except Permitted Encumbrances, Encumbrances disclosed in
this Agreement or the Disclosure Schedule, Assumed Liabilities and the Retained
Know-How Rights), as well as such other instruments of sale and/or transfer as
counsel to Purchaser may reasonably request (whether at or after the Closing
Date) to evidence and effect the transaction contemplated herein.  Parent and
the Seller agree that, to the extent any Assets are owned or held by any
Affiliate of Parent or Seller, the Parent and/or Seller shall also cause good
and marketable title to such Assets to be transferred and assigned to Purchaser
free and clear of all Encumbrances (except Permitted Encumbrances, Encumbrances
disclosed in this Agreement or the Disclosure Schedule, Assumed Liabilities and
the Retained Know-How Rights) on the Closing Date.

            (b)              
Notwithstanding anything herein to the contrary, Parent and Seller shall
retain all of their respective rights, title and interest in and to, and
Purchaser not shall acquire any interest in, the Excluded Assets.

Section 1.2             
The Purchase Price.

            (a)               
The aggregate consideration for the Assets shall be the assumption of
the Assumed Liabilities pursuant to Section 1.3(a) and the payment of the
Purchase Price (subject to adjustment as provided herein).  At Closing the
Purchaser shall deliver to Seller, via wire transfer, an amount equal to the
Purchase Price less (i) any Withholding Taxes deducted pursuant to
Section 1.2(b), and (ii) the Indemnification Holdback.

            (b)              
Purchaser may deduct from the Purchase Price any Withholding Taxes. 
Purchaser shall provide Seller with evidence of payment to the appropriate
taxing authorities of the withheld Withholding Taxes.  If for any reason the
appropriate amount of Withholding Taxes is not withheld from the Purchase
Price, any Withholding Taxes not withheld shall remain Excluded Liabilities
despite such failure to withhold, and any amount in excess the actual
Withholding Taxes payable shall be refunded to Parent as soon as reasonably
practicable.

Section 1.3             
Assumption of Liabilities.

            (a)               
Subject to and upon the terms and conditions of this Agreement,
effective as of the Closing Date, Purchaser agrees to assume from the Parent
and/or the Seller and to thereafter pay, perform and/or otherwise discharge in
a timely manner only the Assumed Liabilities.

            (b)              
Nothing herein shall be deemed to deprive Purchaser or any Affiliate of
Purchaser of any Defenses and Claims.  Effective as of the Closing, Parent and
the Seller agree to assign, transfer and convey to Purchaser all Defenses and
Claims and agree to cooperate with Purchaser to maintain, secure, perfect and
enforce such Defenses and Claims.

2

Section 1.4             
Liabilities Not Assumed.  Except as expressly set forth in
Section 1.3 above with respect to the Assumed Liabilities, Purchaser shall not
assume or become liable or obligated in any way, and Parent and/or the Seller
shall retain and remain solely liable for and obligated to discharge and
neither Purchaser nor any Affiliate thereof shall be liable in any manner for,
all debts, expenses, accounts payable, contracts, agreements, commitments,
obligations, claims, suits and other liabilities of Parent or the Seller of any
nature whatsoever, whether or not related to the business of the Seller or the
Assets, whether known or unknown, accrued or not accrued, fixed or contingent,
current or arising hereafter which is not an Assumed Liability, including, but
not limited to liabilities that relate to the ownership of the Assets prior to
the Closing (other than Assumed Liabilities).

ARTICLE II

THE CLOSING

Section 2.1             
The Closing.  The closing of the sale and transfer of the Assets
to Purchaser and the other Transactions shall take place at the offices of DLA
Piper US LLP, 4365 Executive Drive, Suite 1100, San Diego, CA 92121, at 10:00
a.m., California time, on such date as shall be mutually agreed upon by the
parties hereto but in any event no later than five (5) business days following
the satisfaction and/or waiver of all conditions to close set forth in Article
VI (other than conditions which can be satisfied only by the delivery of
certificates, opinions or other documents at the Closing), unless another date
or place is agreed in writing by each of the parties hereto.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE

PARENT AND THE SELLER

Except as
specifically set forth in the Disclosure Schedule delivered to Purchaser
simultaneously with the execution hereof, Parent and Seller jointly and
severally represent and warrant to Purchaser that all of the statements
contained in this Article III are true and complete as of the date of this
Agreement (or, if made as of a specified date, as of such date), and will be true
and complete as of the Closing Date as though made on the Closing Date.  Each
exception set forth in the Disclosure Schedule and each other response to this
Agreement set forth in the Disclosure Schedule is identified by reference to,
or has been grouped under a heading referring to, a specific individual section
or subsection of this Agreement; provided, however, that any
matter set forth in one section of the Disclosure Schedule shall also be deemed
to apply to each section or subsection of this Agreement, other than
Sections 3.20 and 3.27 which require specific disclosure thereunder of any
exception to the representations and warranties set forth therein, to which its
relevance is readily apparent on its face from the specific content of the disclosure
set forth in the Disclosure Schedule and Parent and Seller shall make a good
faith effort to cross-reference to such other section(s) and/or subsection(s).

3

Section 3.1             
Authorization.  Parent and Seller have full corporate power and
authority to execute and deliver this Agreement and the Ancillary Agreements
(to which they will be a party) and to consummate the Transactions.  The
execution, delivery and performance by Parent and Seller of this Agreement and
the Ancillary Agreements (to which they will be a party) and the consummation
by it of the Transactions have been duly authorized by the Board of Directors
of each of Parent and Seller, and no other corporate action on the part of
Parent or Seller is necessary to authorize the execution and delivery by Parent
and Seller, respectively, of this Agreement, the Ancillary Agreements (to which
they will be a party) or the consummation by it of the Transactions.  No vote
of, or consent by, the holders of any class or series of capital stock or
Voting Debt issued by Parent or Seller is necessary to authorize the execution
and delivery by Parent and Seller of this Agreement, the Ancillary Agreements
(to which they will be a party) or the consummation by it of the Transactions.

Section 3.2             
Binding Agreement.  This Agreement has been, and the Ancillary
Agreements to which they will be a party will be, duly executed and delivered
by Parent and Seller and, assuming due and valid authorization, execution and
delivery thereof by Purchaser, this Agreement constitutes, and each Ancillary
Agreement to which it is a party will constitute, a valid and binding
obligation of Parent and Seller enforceable against Parent and Seller in
accordance with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance and other similar
laws of general application affecting enforcement of creditors' rights
generally and (ii) the availability of the remedy of specific performance or
injunctive or other forms of equitable relief may be subject to equitable defenses
and would be subject to the discretion of the court before which any proceeding
therefor may be brought.

Section 3.3             
Good Title Conveyed.  The Bill of Sale and the endorsements,
assignments and other instruments to be executed and delivered by Parent and
the Seller to Purchaser at the Closing will be valid and binding obligations of
Parent and the Seller, enforceable in accordance with their respective terms,
and will effectively vest in Purchaser good, valid and marketable title to all
the Assets free and clear of all Encumbrances (except Assumed Liabilities,
Permitted Encumbrances and the Retained Know-How Rights).  Except for the
Excluded Assets and the Retained Know-How Rights, the Assets include all
assets, properties, contracts, permits or other items that are of material
importance to the ongoing operation of the business of Seller in substantially
the same manner in which such business has been conducted by Seller prior to
the date of this Agreement.

Section 3.4             
Organization; Qualification of Parent and the Seller.  Parent and
the Seller (i) are each a corporation duly organized and validly existing (and,
if applicable, in good standing) under the laws of its respective state of
incorporation; (ii) have full corporate power and authority to carry on
the business of the Parent and the Seller, respectively, as now being conducted
and to own the Assets; and (iii) are duly qualified or licensed to do business
as a foreign corporation in good standing in every jurisdiction in which the
conduct of the business of the Seller requires such qualification, except where
failure to so qualify or be licensed would not have a Material Adverse Effect
on the ability of Parent or Seller to consummate the Transactions.  Seller has
heretofore delivered to Purchaser complete and correct copies of the
certificate or articles of incorporation and bylaws of Parent and Seller,
respectively, as currently in effect.  All of the outstanding capital stock of
Seller is owned directly by Parent.  The Seller has no Subsidiaries.

4

Section 3.5             
Consents and Approvals; No Violations.  Except for the filings,
permits, authorizations, consents and approvals as may be required under, and
other applicable requirements of, the Exchange Act, the HSR Act and state
securities or blue sky laws, none of the execution, delivery or performance of
this Agreement or any Ancillary Agreement to which they will be a party by
Parent and Seller, the consummation by Parent and Seller of the Transactions or
compliance by Parent and Seller with any of the provisions hereof will
(i) conflict with or result in any breach of any provision of the
certificate or articles of incorporation, the bylaws or similar organizational
documents of Parent or Seller, (ii) require any filing with, or permit,
authorization, consent or approval of, any Governmental Entity or other Person
(including, without limitation, consents from parties to loans, contracts,
leases and other agreements to which Parent or Seller is a party), except for
those filings, permits, authorizations, consents or approvals with respect to which
failure to obtain would not result in a Material Adverse Effect to Seller,
(iii) require any consent, approval or notice under, or result in a violation
or breach of, or constitute (with or without due notice or the passage of time
or both) a default (or give rise to any right of termination, amendment,
cancellation or acceleration, or otherwise result in a Material Adverse Effect
or the loss of any material rights to Parent, Seller or Purchaser) under, any
of the terms, conditions or provisions of any agreement to which the Parent or
Seller is a party or by which the Assets are bound, or (iv) violate any
order, writ, injunction, decree, statute, rule or regulation applicable to the
Assets of the Parent or Seller.

Section 3.6             
Governmental Authorization.  Parent (solely with respect to the
Seller and the Assets) and Seller (with respect to the Assets) has obtained
each federal, state, county, local or foreign governmental consent, license,
permit, grant, or other authorization of a Governmental Entity (a) pursuant to
which the Parent or Seller currently operates or holds any interest in any of
the Assets; or (b) that is required for the Assets or the operation of the
business of Seller or the holding of any such interest and all of such
authorizations are in full force and effect, except where the failure to obtain
or have any such authorizations, consents, licenses, permits, or grants could
not reasonably be expected to have a Material Adverse Effect.

Section 3.7             
Restrictions on Business Activities.  There is no agreement,
judgment, injunction, order or decree binding upon Parent or Seller that has or
could reasonably be expected to have the effect of prohibiting or materially
impairing the full use and enjoyment of the Assets, any current business
practice of Seller by Purchaser (other than such practices as are solely
related to the Excluded Business), or the conduct of the business of Seller (other
than the Excluded Business) by Purchaser as such business is currently
conducted by Seller.

Section 3.8             
Financial Information.  Parent and Seller have previously
furnished to Purchaser  the Financial Information.  The Financial Information
has been prepared from, is in accordance with and accurately reflects in all
material respects the books and records of Parent and the Seller.

Section 3.9             
Books and Records.  The books of account, Financial Information,
minute books, stock record books and other records of Parent (solely with
respect to the Seller and any of the Assets) and the Seller are complete and
correct in all material respects and have been maintained in accordance with
sound business practices.  

5

Section 3.10         
Accounts Receivable.  All accounts receivable of the Parent and
Seller (solely with respect to Assets that constitute accounts receivable and
not with respect accounts receivable that are Excluded Assets), whether
reflected in the Financial Information or otherwise, have arisen solely out of
bona fide sales and deliveries of goods, performance of services, and other
business transactions in the ordinary course of business consistent with past
practices in each case with Persons other than Affiliates, are not subject to
any prior assignment, lien or security interest and, to the Knowledge of Parent
and Seller, are not subject to valid defenses, set-offs or counter claims, and
are current and collectible net of any reserves shown in the Financial
Information.  Subject to such reserve, each of the accounts receivable included
in the Assets either has been collected in full or will be collected in full,
without any set-off, within sixty (60) days after the day on which it became
due and payable.

Section 3.11         
Disputed Accounts Payable.  There are no unpaid invoices or bills
representing amounts alleged to be owed by Parent on account of the Seller or
alleged to be owed by Seller or other alleged obligations of the Seller, in
each case with respect to the Assets, which Parent or Seller has disputed or
determined to dispute or refuse to pay.

Section 3.12         
Inventory.  All of the inventories of the Parent and Seller
(solely with respect to inventory items that are included in the Assets and not
with respect to inventory items that are Excluded Assets), whether reflected in
the Financial Information or otherwise, consist of a quality and quantity
usable and salable in the ordinary and usual course of business, except for
items of obsolete materials and materials of below-standard quality, all of
which items have been written off or written down as reflected in the Financial
Information or for which adequate reserves have been provided therein.  All
inventories included in the Assets and not written off have been priced at the
lower of average cost or market.  All finished goods inventory included in the
Assets is, to the Knowledge of Parent and Seller, free of any Defect.  Except
for Defects in work in process inventory that arise in the ordinary course of
business consistent with past practice and industry norms, all work in process
inventory included in the Assets is, to the Knowledge of Parent and Seller,
free of any Defect.

Section 3.13         
Equipment Held by Suppliers.  The Disclosure Schedule lists each
pattern, die and tooling included in the Assets and owned by Parent for the
benefit of the Seller or owned by Seller which is not in the possession of the
Parent or Seller, if any, together, in each case, with the name, address and
telephone number of each Person who holds such property.

Section 3.14         
Goods Held on Consignment.  The Disclosure Schedule lists all
goods that constitute Assets, if any, owned by Parent (for the benefit of the
Seller) or the Seller which goods have been consigned by Parent or Seller to
another Person, together, in each case, with a description of the terms of such
consignment and the name, address and telephone number of the Person to whom
such property has been consigned.

Section 3.15         
Absence of Certain Changes.  Since September 30, 2006, each of
the Parent (solely with respect to the Seller or any of the Assets) and the
Seller has conducted its respective business only in the ordinary and usual
course consistent with past practice, and neither the Parent (solely with
respect to the Seller or any of the Assets) nor the Seller has:

            (a)               
suffered any change in its working capital, financial condition, results
of operation, assets, liabilities (absolute, accrued, contingent or otherwise),
reserves, business, operations or prospects that has resulted in, or could
reasonably be expected to result in a Material Adverse Effect;

6

            (b)              
incurred any liability or obligation (absolute, accrued, contingent or
otherwise) except non-material items incurred in the ordinary course of
business and consistent with past practice, none of which exceeds $50,000
(counting obligations or liabilities arising from one transaction or a series
of similar transactions, and all periodic installments or payments under any
lease or other agreement providing for periodic installments or payments, as a
single obligation or liability);

            (c)               
paid, discharged or satisfied any material claim, material liability or
material obligation (whether absolute, accrued, contingent or otherwise) other
than the payment, discharge or satisfaction in the ordinary course of business
and consistent with past practice;

            (d)              
permitted or allowed any of the Assets to be subjected to any
Encumbrance, except for liens for current taxes not yet due;

            (e)               
written down the value of any inventory included in the Assets or
written off as uncollectible any notes or accounts receivable included in the
Assets, except for immaterial write-downs and write-offs in the ordinary course
of business and consistent with past practice;

            (f)                
cancelled any debts with respect to the business of the Seller or the
Assets or waived any claims or rights of substantial value with respect to the
business of the Seller or the Assets;

            (g)               
acquired, sold, transferred, or otherwise disposed of any Assets, except
in the ordinary course of business and consistent with past practice;

            (h)               
disposed of or permitted to lapse any rights to the use of any
Proprietary Rights;

            (i)                 
granted any general increase in the compensation of officers or
employees (other than Excluded Employees) of the Seller (including any such
increase pursuant to any bonus, pension, profit-sharing or other plan or
commitment) or any other increase in the compensation payable or to become
payable to any officer or employee (other than an Excluded Employee) of the
Seller, other than in the ordinary course of business and consistent with past
practices;

            (j)                
made any single capital expenditure or commitment in excess of $50,000
for additions to property, plant, equipment or intangible capital assets or
made aggregate capital expenditures and commitments in excess of $100,000 (on a
Seller-wide basis) for additions to property, plant, equipment or intangible
capital assets;

            (k)              
declared, paid or set aside for payment any dividend or other
distribution in respect of its capital stock, except dividends with respect to
Parent's or Seller's capital stock in property which does not constitute a part
of the Assets or in cash;

            (l)                 
paid, loaned or advanced any amount to, or sold, transferred or leased
any Assets to, or entered into any agreement or arrangement with, any of its
officers or directors or any Affiliate or Associate of any of its officers or
directors except for (i) compensation to officers at rates not exceeding the
rates of such fees and compensation in at September 30, 2006 and
(ii) expense reimbursements and advances in the ordinary course of business
consistent with past practice; or

7

            (m)             
agreed, whether in writing or otherwise, to take any action described in
this section.

Section 3.16         
Title to Properties; Encumbrances.  Except for property sold
since September 30, 2006 in the ordinary course of business and consistent with
past practice, each of Parent and Seller has good, valid and marketable title
to all of the Tangible Personal Property that each of them purports to own free
and clear of all Encumbrances (other than Permitted Encumbrances).  The Assets to
be conveyed to Purchaser and the Assumed Contracts to be assumed by Purchaser
upon consummation of the Transactions include all rights, properties and other
assets used by Parent and Seller to conduct the Seller's business (other than
the Excluded Business), or necessary to permit Purchaser to conduct such
business after the Closing in all material respects in the same manner as such
business has been conducted by Seller prior to the Closing, except for the
Excluded Assets, the Retained Know-How Rights and Assets sold since the date of
this Agreement in the ordinary course of business and consistent with past
practice.

Section 3.17         
Real Property.  The Disclosure Schedule sets forth a complete
list and the location of all Real Property.  To the Knowledge of Parent and the
Seller, there are no proceedings, claims, or disputes affecting any Real
Property that might interfere with the current use of the Seller Facility.

Section 3.18         
Leases.  The Disclosure Schedule contains an accurate and
complete description of the terms of each Lease.  A true and complete copy of
each Lease has heretofore been delivered to Purchaser.  Each Lease is valid,
binding and enforceable in accordance with its terms and is in full force and
effect.  The leasehold estate created by each Lease is free and clear of all
Encumbrances (other than Permitted Encumbrances).  There are no existing
defaults by Parent or Seller under any of the Leases.  No event has occurred
that (whether with or without notice, lapse of time or the happening or
occurrence of any other event) would constitute a default by Parent or Seller
under any Lease.  To the Knowledge of Parent and Seller, the lessor under each
Lease will consent (where such consent is necessary) to the consummation of the
Transactions without requiring any modification of the rights or obligations of
the lessee thereunder.

Section 3.19         
Equipment.  The equipment included in the Assets that is owned or
used by the Parent or Seller has no known defects and is in good operating
condition and repair, ordinary wear and tear excepted.  None of the equipment
included in the Assets is in need of maintenance or repairs except for
ordinary, routine maintenance and repairs which are not material in nature or
cost.

Section 3.20         
Environmental Matters.

            (a)               
Each of Parent (solely with respect to the Seller and Parent's use of the
Assets) and the Seller is in compliance in all material respects with all
Environmental Laws.  Such compliance includes, but is not limited to, the
possession by Seller (and Parent's use of the Assets) of all permits and other
governmental authorizations required under all applicable Environmental Laws
with respect to the Assets, and compliance with the material terms and
conditions thereof.  Each such permit and other governmental authorization
pursuant to the Environmental Laws is specifically identified in the Disclosure
Schedule.

8

            (b)              
To the Knowledge of Parent and Seller, neither Parent (solely with
respect to the Seller or Parent's use of the Assets) nor Seller has received
any communication (written or oral), whether from a Governmental Entity,
citizens group, employee or otherwise, that alleges that the Assets are not,
and the use thereof has not been, in full compliance with any Environmental
Laws, and neither Seller nor Parent (solely with respect to Seller's or
Parent's use of the Assets) are aware of any circumstances that may prevent or
interfere with such full compliance in the future.  Parent and Seller have
delivered to Purchaser prior to the execution of this Agreement all
environmental reports that are in the possession of or reasonably available to
the Parent and the Seller regarding the Assets.

            (c)               
There is no Environmental Claim by any Person that is pending or, to the
Knowledge of Parent and Seller, threatened against Parent or Seller or against
any Person whose liability for any Environmental Claim Parent or Seller has
assumed under any of the Assumed Contracts relating to the Assets.

            (d)              
To the Knowledge of Parent and Seller, there are no past or present
actions, activities, circumstances, conditions, events or incidents caused by
Seller or Parent (solely with respect to the Assets) or against any Person
whose liability for any Environmental Claim Parent or Seller has assumed under
any of the Assumed Contracts, including the release, emission discharge,
presence or disposal of any Materials of Environmental Concern by Seller, that
are in violation of Environmental Laws related to the Assets.

            (e)               
Without in any way limiting the generality of the foregoing, (i) Seller
has stored, disposed or arranged for the disposal of Materials of Environmental
Concern in compliance in all material respects with Environmental Laws, (ii) to
the Knowledge of Parent and Seller, there is no asbestos contained in or
forming part of any of the Assets, and (iii) to the Knowledge of Parent and
Seller, no PCBs or PCB-containing items are used or stored at the premises
covered by Section 5.17.

            (f)                
The Assets are not subject to any removal or remediation action currently
in effect relating to Materials of Environmental Concern.

Section 3.21         
Contracts and Commitments.

            (a)               
Other than the Assumed Contracts, none of Parent or Seller has any
agreements, contracts, commitments or restrictions which are material to
Seller's business, including the operations and prospects thereof (other than
such agreements, contracts, commitments or restrictions relating solely to the
Excluded Business).  

            (b)              
No purchase contracts or commitments under the Assumed Contracts
continue for a period of more than 12 months from the Closing Date.

            (c)               
Each of the Assumed Contracts is cancellable on notice of not longer
than 30 days and without liability, penalty or premium or the payment of any
other additional amount to which the other party to such agreement would not
otherwise be entitled.

9

            (d)              
None of Parent or Seller has any employment agreement, or any other
agreement that contains any severance or termination pay, bonus or sales
commission or similar liabilities or obligations, with any director, officer,
employee, agent, consultant or advisor of Seller.

            (e)               
None of Parent (solely with respect to the Seller and the Assets) or
Seller is in material default under or in material violation of, nor to the
Knowledge of Parent and Seller is there any valid basis for any claim of
material default under or material violation of, any contract, commitment or
restriction to which it is a party or by which it is bound.

            (f)                
None of Parent (solely with respect to the business of Seller) or Seller
(solely with respect to the Assumed Contracts or as otherwise applicable to the
Assets) is restricted by agreement from carrying on its business anywhere in
the world.

            (g)               
With respect to each Assumed Contract:  (i) the Assumed Contract is
legal, valid, binding and enforceable and in full force and effect with respect
to Parent or Seller, as applicable, and to the Knowledge of Parent and Seller
is legal, valid, binding, enforceable and in full force and effect with respect
to each other party thereto, in either case subject to the effect of
bankruptcy, insolvency, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and except as the availability of
equitable remedies may be limited by general principles of equity; (ii) to the
Knowledge of Parent and Seller, the Assumed Contract will continue to be legal,
valid, binding and enforceable and in full force and effect immediately
following the Closing in accordance with its terms as in effect prior to the
Closing, subject to the effect of bankruptcy, insolvency, moratorium or other
similar laws affecting the enforcement of creditors' rights generally and
except as the availability of equitable remedies may be limited by general
principles of equity; and (iii) neither Parent, Seller, nor to the Knowledge of
Parent and Seller, any other party, is in breach or default in any material
respect, and no event has occurred (or by entering into this Agreement will
occur) that with notice or lapse of time would constitute a breach or default
in any material respect by Parent or Seller, as applicable, or, to the
Knowledge of Parent and Seller, by any such other party, or permit termination,
or modification of, or acceleration of any payment due under, such Assumed
Contract, and no notice of any such alleged breach or default has been served
on or received by Parent or Seller.

Section 3.22         
Customers and Suppliers.  Part 3.22 of the Disclosure
Schedule lists, by dollar volume paid for the year ended March 31, 2006, the
material customers of Seller and the material suppliers of Seller (in each case
solely with respect to Seller Products that are included in the Assets).  With
respect to such customers and suppliers:  (a) all amounts owing from such
customers and suppliers, if not in dispute, have been paid substantially in
accordance with their respective terms; (b) none of such customers or
suppliers within the last twelve (12) months has threatened in writing to
cancel, or otherwise terminate, the relationship of such person with Seller;
and (c) none of such customers or suppliers during the last twelve (12)
months has decreased materially or threatened to decrease or limit materially,
its relationship with Seller or, to the Knowledge of Parent and the Seller,
intends to decrease or limit materially its purchases from, or sales to,
Seller.

10

Section 3.23         
Insurance.  The Disclosure Schedule sets forth a true and
complete list and description of all claims paid out or pending under all
insurance policies, other insurance arrangements and other contracts or
arrangements for the transfer or sharing of insurance risks by the Parent or
Seller in force on the date hereof with respect to the business of the Seller
or any of the Assets (and the use thereof).

Section 3.24         
Casualties.  Since September 30, 2006, none of the Assets has
been affected in any way as a result of flood, fire, explosion or other
casualty (whether or not material and whether or not covered by insurance).

Section 3.25         
Litigation.

            (a)               
There is no private or governmental action, suit, proceeding, claim,
arbitration or investigation pending before any Governmental Entity, foreign or
domestic, or, to the Knowledge of Parent and the Seller, threatened against
Parent (solely with respect to the Seller or Parent's use of any of the Assets)
or the Seller, or any of the Seller's properties or any of the Seller's
officers or directors (in their capacities as such).

            (b)              
There is no judgment, decree or order against Parent (solely with
respect to the Seller or Parent's use of the Assets) or Seller or, to the
Knowledge of Parent and the Seller, any of Seller's directors or officers (in
their capacities as such), that (i) restricts in any manner the use, transfer
or licensing of any Proprietary Rights in which Parent (solely with respect to
Seller or any of the Assets) or Seller has (or purports to have) any right,
title or interest; (ii) could prevent, enjoin, or materially alter or delay any
of the Transactions or (iii) that could reasonably be expected to have a
Material Adverse Effect on Seller or any of the Assets.

            (c)               
All litigation to which Parent (solely with respect to Seller or
Parent's use of the Assets) or Seller is a party (or, to the Knowledge of
Parent and the Seller), threatened to become a party) is described in the
Disclosure Schedule.

Section 3.26         
Compliance with Laws.  Parent and Seller have complied in all
material respects with all laws, rules and regulations, ordinances, judgments,
decrees, orders, writs and injunctions of all United States federal, state,
local, foreign governments and agencies thereof that affect the Assets or the
business of the Seller, and no notice, charge, claim, action or assertion has
been received by Parent (solely with respect to the Seller or any of the
Assets) or Seller or has been filed, commenced or, to the Knowledge of Parent
and the Seller, threatened against Parent (solely with respect to the Seller or
any of the Assets) or Seller alleging any violation of any of the foregoing.

Section 3.27         
Tax Matters.

            (a)               
Parent (solely with respect to the Seller) and Seller have complied in
all respects with all applicable laws, rules and regulations relating to the
payment and withholding of Taxes and have, within the time and the manner
prescribed by law, withheld and paid over to the proper taxing authorities all
amounts required to be withheld and paid in connection with amounts paid or
owing to any employee, independent contractor, creditor, stockholder or other
third party.

    11

            (b)              
No federal, state, local or foreign audits, examinations, investigations
or other administrative proceedings or court proceedings are presently pending
with regard to any Taxes or Tax Returns of Parent (solely with respect to the
Seller) or Seller.  A list of all audits, examinations or investigations
commenced or completed with respect to Parent (solely with respect to the
Seller), or Seller with respect to taxable periods ending after March 31,
2003 is set forth in the Disclosure Schedule.

            (c)               
There are no liens for Taxes upon the Assets, except for statutory liens
for Taxes not yet due.

            (d)              
All Tax deficiencies that have been claimed, proposed or asserted
against Parent (solely with respect to the Seller or any of the Assets) or
Seller have been fully paid or finally settled, and no issue has been raised in
any examination by any taxing authority that, by application of similar
principles, could reasonably be expected to result in the proposal or assertion
of a Tax deficiency for another year not so examined.

            (e)               
No power of attorney has been granted by or with respect to Parent
(solely with respect to the Seller or any of the Assets) or Seller with respect
to any matter relating to Taxes.

            (f)                
None of Parent or Seller is a party to, is bound by or has any
obligation under any Tax sharing agreement, Tax indemnification agreement or
similar contract or arrangement, and none of Parent or Seller has any potential
liability or obligation to any Person as a result of, or pursuant to, any such
agreement, contract or arrangement.

            (g)               
None of Parent or Seller has filed a consent to the application of
Section 341(f) of the Code, or agreed to have Section 341(f)(2) of the Code
apply to any disposition of a subsection (f) asset (as such term is defined in
Section 341(f)(4) of the Code) owned by Parent or Seller.

            (h)               
None of the Parent or Seller is or has been a U.S. real property holding
company (as defined in Section 897(c)(2) of the Code) during the applicable
period specified in Section 897(c)(1)(ii) of the Code.

            (i)                 
Other than any Tax Returns that have not yet been required to be filed,
Parent and Seller have made available to Purchaser true and complete copies of
the state and local sales, use and property Tax Return of Parent and Seller for
each of the taxable years ended in 2003, 2004 and 2005.

            (j)                
Parent and Seller have delivered to Purchaser complete and accurate
copies of each of (i) all audit reports, letter rulings, technical advice
memoranda and similar documents issued by a Governmental Entity relating to the
federal, state, local or foreign Taxes due from or with respect to Seller
and/or any of the Assets and (ii) all closing agreements entered into by
or on behalf of Seller or with respect to any of the Assets with any taxing
authority in each case existing on the date hereof.

            (k)              
All Taxes owed and due by Parent (solely with respect to the Seller or
the Assets) or Seller (whether or not shown on any Tax Return) have been paid
on a timely basis.

12

            (l)                 
Parent and Seller have duly filed all Tax Returns relating to the Seller
or the Assets that are required to be filed and have duly paid or caused to be
duly paid in full all Taxes relating to Seller or the Assets required to be
paid for all periods or portions thereof ending through the date hereof.  All
such Tax Returns are correct and complete in all material respects and
accurately reflect all liability for such Taxes for the periods covered
thereby.

            (m)             
None of Parent (solely with respect to Seller or the Assets) or Seller
has received written notice of any claim made by an authority in a jurisdiction
where Parent or Seller does not file Tax Returns, that Parent (solely with
respect to Seller or the Assets) or Seller is or may be subject to taxation by
that jurisdiction.

            (n)               
None of Parent (solely with respect to Seller or the Assets) or Seller
has waived any statute of limitations in any jurisdiction in respect of Taxes
or Tax Returns relating to the Seller or the Assets or agreed to any extension
of time with respect to a Tax assessment or deficiency relating to the Seller
or the Assets nor is any request to do so outstanding.

            (o)              
None of the Assets is or will be required to be treated as being owned
by another person pursuant to section 168(f)(8) of the Code (as in effect prior
to the amendment by the Tax Reform Act of 1986) or is "tax-exempt use property"
within the meaning of section 168 of the Code.

Section 3.28         
Employee Benefit Plans.

            (a)               
The Disclosure Schedule lists each Plan covering the employees of Seller.

            (b)              
None of the Plans is a pension plan (within the meaning of Section 3(2)
of ERISA) that is subject to Title IV of ERISA or a multiemployer plan (within
the meaning of Section 3(37) or 4001(3) of ERISA) that is subject to Title IV
of ERISA.  None of the Assets is subject to a lien arising under Section 3.02
of ERISA or Title IV of ERISA, nor has any event occurred that could reasonably
be expected to give rise to any such lien.

            (c)               
Except as required by law, no Plan provides medical or dental coverage
following retirement or other termination of employment.

Section 3.29         
Intellectual Property.

            (a)               
Part 3.29(a) of the Disclosure Schedule lists the following with respect
to Proprietary Rights of the Parent (solely with respect to Proprietary Rights
included in the Assets) and Seller:

                        (i)                 
Part 3.29(a)(i)(A) of the Disclosure Schedule list all of the Patents
owned by the Seller and the Parent (to the extent such Patents are included in
the Assets), setting forth in each case the jurisdictions in which Issued Patents
have been issued and Patent Applications have been filed.  Part 3.29(a)(i)(B) of
the Disclosure Schedule lists all of the Patents in which the Seller and the
Parent (to the extent such Patents are included in the Assets) have any right,
title or interest (including without limitation interest acquired through a
license or other right to use) other than those owned by the Seller and the
Parent (to the extent such Patents are included in the Assets), setting forth
in each case the jurisdictions in which the Issued Patents have been issued and
Patent Applications have been filed, and the nature of the right, title or
interest held by the Seller and Parent.

13

                        (ii)               
Part 3.29(a)(ii)(A)-1 and Part 3.29(a)(ii)(A)-2 of the Disclosure
Schedule lists all of the Registered Trademarks and domain names and domain
name registrations owned by the Seller and the Parent (in each case, to the
extent such Registered Trademarks, domain names and domain registrations are
included in the Assets), setting forth in each case the jurisdictions in which
Registered Trademarks and domain names and domain name registrations have been
registered and trademark and domain name applications for registration have
been filed and all other Trademarks owned by the Seller and the Parent (in each
case, to the extent such other Trademarks are included in the Assets) or used
in connection with any Seller Products or in the conduct of the business of the
Seller(other than Trademarks used solely in the Excluded Business).  Part
3.29(a)(ii)(B) of the Disclosure Schedule lists all of the Registered
Trademarks, all other Trademarks and all domain names used in connection with
any Seller Products or in the conduct of the business of the Seller (other than
Trademarks and domain names used solely in the Excluded Business) in each case
in which the Seller and the Parent have any right, title or interest, other
than those owned by the Seller and the Parent (including without limitation
interest acquired through a license or other right to use), setting forth each
case the jurisdictions in which Registered Trademarks have been registered and
trademark applications for registration have been filed, and the nature of the
right, title or interest held by the Seller and the Parent.

                        (iii)              
Part 3.29(a)(iii)(A) lists all of the Registered Copyrights owned by the
Seller and the Parent (in each case, to the extent such Registered Copyrights
are included in the Assets), setting forth in each case the jurisdictions in
which such Copyrights have been registered and applications for copyright
registration have been filed and lists all proprietary software, middleware and
firmware distributed by the Seller and the Parent (in each case, to the extent
included in the Assets).  Part 3.29(a)(iii)(B) lists all of the Registered
Copyrights in which the Seller and the Parent (in each case, to the extent such
Registered Copyrights are included in the Assets) has any right, title or
interest, other than those owned by the Seller and Parent and other than in
Off-the-Shelf Software (including without limitation interest acquired through
a license or other right to use), setting forth in each case the jurisdictions
in which the Registered Copyrights have been registered and applications for
Copyright registration have been filed, and the nature of the right, title or
interest held by the Seller.

14

            (b)              
The Seller and the Parent are the sole and exclusive owners of and have
good, valid and marketable title to, free and clear of all IP Encumbrances,
except for the Retained Know-How Rights and any Permitted Encumbrances, (i) all
of the Seller Proprietary Rights identified in Parts 3.29(a)(i)(A) and
3.29(a)(iii)(A) of the Disclosure Schedule, (ii) except for Copyrights in
Off-the-Shelf Software and Copyrights licensed to the Seller or the Parent by
third Persons as disclosed in the Disclosure Schedule, all Copyrights in
software, middleware and firmware used or distributed by the Seller and the
Parent (in each case, to the extent included in the Assets), and (iii) all
Trade Secrets owned by the Seller or the Parent (to the extent included in the
Assets).  To the Knowledge of Parent and Seller, Seller and Parent have a
valid, legally enforceable right to use, license, practice and otherwise
exploit all Proprietary Rights identified in Parts 3.29(a)(i)(B), 3.29(a)(ii)(B),
and 3.29(a)(iii)(B) of the Disclosure Schedule (to the extent such party
indicates having such rights therein) and all other Proprietary Rights used by
the Seller and the Parent (in each case, to the extent included in the Assets),
other than those owned by the Seller and Parent (including without limitation any
interest acquired through a license or other right to use).  To the Knowledge
of Parent and Seller, the Seller Proprietary Rights identified in Part 3.29(a)
of the Disclosure Schedule, together with the Trade Secrets used by the Seller
and Parent (in each case, to the extent included in the Assets), constitutes
all Proprietary Rights used or currently proposed by Seller to be used or
necessary in connection with the conduct of the business of the Seller (other
than the Excluded Business) as conducted prior to or on the date of this
Agreement and as proposed to be conducted by the Seller, including without
limitation as necessary or appropriate to make, use, offer for sale, sell or
import the Seller Products; provided, however, that if Parent or Seller
subsequently become aware of additional Proprietary Rights so used ("Additional
Proprietary Rights"), Parent and Seller shall promptly convey all right,
title and interest to such Additional Proprietary Rights to Purchaser in
accordance with Section 5.9(a).  To the Knowledge of the Parent and the Seller,
all Proprietary Rights used by the Seller and Parent (in each case, to the
extent included in the Assets), other than those owned by the Seller and Parent 
(including without limitation interests acquired through a license or other
right to use, but excluding any Off-the-Shelf Software) are free and clear of
IP Encumbrances and the Seller and Parent have not received any notice that any
portion of such Proprietary Rights are subject to any IP Encumbrance.

            (c)               
Part 3.29(c) of the Disclosure Schedule lists all oral and written
contracts, agreements, licenses and other arrangements relating to any Seller
Proprietary Rights or any Seller Products (other than this Agreement and the
Ancillary Agreements), in each case unless solely related to the Excluded
Business, as follows:

15

                        (i)                 
Part 3.29(c)(i) lists any agreement, contract, license or other
arrangement, written or oral, (A) granting any Person any right to make, have
made, manufacture, use, sell, offer to sell, import, export, or otherwise
distribute any Seller Product, with or without the right to sublicense the
same; (B) granting any license of, any covenant not to assert/sue or other
immunity from suit under or any other rights to any current or future
Proprietary Rights, with or without the right to sublicense the same granted to
or granted by the Parent (solely with respect to the Seller's business (other
than the Excluded Business) or any of the Assets) or Seller (in each case, other
than licenses granted to the Parent or Seller for Off-the-Shelf Software); (C)
regarding joint development of any Seller Products or Proprietary Rights; (D)
by which the Parent or the Seller grants any ownership right or title to any
Seller Proprietary Rights owned by the Parent (solely with respect to Seller or
any of the Assets) or Seller or by which the Parent or Seller is assigned or
granted an ownership interest in any Proprietary Rights (solely with respect to
the Parent to the extent included in the Assets) other than agreements with
employees and contractors that assign or grant to the Parent or Seller 
ownership of Proprietary Rights developed in the course of providing services
by such employees and contractors; (E) under which the Parent or the Seller
undertakes any ongoing royalty or payment obligations with respect to any
Seller Proprietary Rights; (F) under which the Seller grants or receives an
option or right of first refusal relating to any Proprietary Rights (other than
Proprietary Rights related solely to the Excluded Business) or under which the
Parent grants a right of first refusal with respect or relating to any Seller
Proprietary Rights or any Assets; (G) under which any third party is granted
any right to access or to use Seller Source Code, including without limitation
to create derivative works of Seller Products; (H) pursuant to which the Parent
or the Seller has deposited or is required to deposit with an escrow agent or
any other Person any Seller Source Code or other Seller Proprietary Rights or
any of the Assets, and further describes whether the execution of this
Agreement or the consummation of any of the Transactions could reasonably be
expected to result in the release or disclosure of any Seller Source Code; and
(I) limiting the ability of the Parent (solely with respect to the Seller's
business (other than the Excluded Business) or any of the Assets) or Seller to
transact business (other than the Excluded Business) in any market, field or
geographical area or with any Person, or that restricts the use, sale,
transfer, delivery or licensing of Seller Proprietary Rights (or any tangible
embodiment thereof), including without limitation any covenant not to compete;

                        (ii)               
Part 3.29(c)(ii) lists any agreement, contract, license or other
arrangement, written or oral, to which the Parent or the Seller is a party and
pursuant to which the Parent or Seller (in each case, solely with respect to
Seller's business other than the Exclude Business) is authorized to use any
Proprietary Rights owned by any Person, excluding nonexclusive licenses for
Off-the-Shelf Software.  Except as set forth in Part 3.29(c)(ii) of the
Disclosure Schedule, none of the Parent or Seller has any obligation to pay any
royalties, license fees or other amounts or provide or pay any other
consideration to any Person by reason of the ownership, use, exploitation,
practice, sale or disposition of Seller Proprietary Rights (or any tangible
embodiment thereof) or other Assets or the reproducing, making, using, selling,
offering for sale, distributing or importing any Seller Products;

                        (iii)              
Except as set forth in Part 3.29(c)(iii) of the Disclosure Schedule,
neither the Parent nor Seller has entered into any written or oral contract,
agreement, license or other arrangement to defend, indemnify or hold harmless
any Person against any charge of infringement of any Proprietary Rights
included in the Assets, other than indemnification provisions contained in
standard sales agreements with customers or end users or other agreements
arising in the ordinary course of business and copies of all Assumed Contracts
containing such provisions have been delivered to Purchaser or its counsel;

                        (iv)             
Part 3.29(c)(iv) of the Disclosure Schedule lists each Seller Product
that contains any Public Software, a description of such Seller Product and the
Public Software license applicable to such Seller Product.  Except as set forth
in Part 3.29(c)(iv) of the Disclosure Schedule, no Public Software forms part
of any software, firmware or middleware included in any Seller Product, and no
Public Software was or is used in connection with the development of any Seller
Product or is incorporated into, in whole or in part, or has been distributed
by Seller (or, to the Knowledge of Seller and Parent, any third party, with, in
whole or in part, any Seller Product; and

                        (v)               
Neither the Parent nor Seller or to the Knowledge of Parent and Seller,
any other Person, is in breach of any contract, agreement, license or other
arrangement described in this Section 3.29(c) and none of the Parent or Seller
has notified any Person and no Person has notified the Parent or Seller of any
such breach.

            (d)              
Except with respect to Proprietary Rights listed in Part
3.29(a)(ii)(A)-2 of the Disclosure Schedule or as set forth in Part 3.29(d) of
the Disclosure Schedule:

16

                        (i)                 
Neither the Parent nor Seller jointly owns, licenses or claims any
right, title or interest with any other Person (other than Parent or Seller) of
any Seller Proprietary Rights (other than Seller Proprietary Rights that relate
exclusively to the Excluded Business).  To the Knowledge of Parent and Seller,
no current or former officer, manager, director, stockholder, member, employee,
consultant or independent contractor of the Parent or Seller has any right,
title, claim or interest in, to or under any Seller Proprietary Rights in which
the Parent (in each case, to the extent included in the Assets) or Seller has
(or purports to have) any right, title or interest that has not been either (a)
irrevocably assigned or transferred to Parent or Seller, or (b) licensed (with
the right to grant sublicenses) to the Parent or Seller under an exclusive,
irrevocable, worldwide, royalty free, fully paid and assignable license.

                        (ii)               
No Person has challenged or, to the Knowledge of Parent and Seller,
threatened to challenge, and no Person has asserted or made a demand or, to the
Knowledge of Parent and Seller, threatened to make a claim or a demand, nor is
there any pending proceeding nor, to the Knowledge of Parent and Seller, are
there any facts which could reasonably be expected to give rise to any such
challenge, claim, demand or proceeding, which would adversely affect (a) any
right, title or interest of the Parent or Seller in, to or under any Seller
Proprietary Rights, (b) any contract, agreement, license or and other
arrangement under which the Parent or Seller claims any right, title or
interest under any Seller Proprietary Rights or restricts in any material
respect the use, manufacture, transfer, sale, delivery or licensing by the Parent
or Seller of the Seller Proprietary Rights or Seller Products, or (c) the
validity, enforceability or claim construction of any Patents forming part of
the Assets or any Seller Proprietary Rights.  

                        (iii)              
Neither the Parent nor Seller is subject to any proceeding or
outstanding decree, order, judgment or stipulation restricting the use,
transfer or licensing of any Seller Proprietary Rights by the Parent or Seller,
the use, manufacture, transfer, sale or licensing of any Seller Product by the
Parent or Seller, or which might affect the validity, use or enforceability of
any Seller Proprietary Rights;

                        (iv)             
No Seller Proprietary Rights owned by or exclusively licensed to the
Parent (in each case, to the extent included in the Assets) or Seller have been
infringed or misappropriated by any Person.  There is no unauthorized use,
disclosure or misappropriation of any Seller Proprietary Rights included in the
Assets by any Person, including without limitation any current or former
officer, manager, director, stockholder, member, employee, consultant or
independent contractor of the Parent or Seller.

                        (v)               
All Patents and Registered Copyrights owned by the Parent (in each case,
to the extent included in the Assets) or Seller and all Patents, Registered
Copyrights and Registered Trademarks licensed to the Parent or Seller (in each
case, to the extent included in the Assets), other than non-exclusive licenses
to Off-the-Shelf Software, (A) have been duly filed or registered (as
applicable) with the applicable Governmental Entity, and maintained, including
the timely submission of all necessary filings and payment of fees in
compliance with the legal and administrative requirements of the appropriate
jurisdictions, (B) have not lapsed, expired or been abandoned and (C) no
opposition proceedings have been commenced related thereto in any jurisdictions
which such procedures are available.

            (e)               
Except as set forth in Part 3.29(e) of the Disclosure Schedule:

17

                        (i)                 
All Patents in which the Parent (to the extent included in the Assets)
or the Seller, has any right, title or interest have been duly filed or
registered (as applicable) with the applicable Governmental Entity, and
maintained, including the submission of all necessary filings and fees in
compliance with the legal and administrative requirements of the appropriate
Governmental Entity, and have not lapsed, expired or been abandoned;

                        (ii)               
(A) all Patents owned by the Parent (to the extent included in the
Assets) or Seller, all Patents for which the Parent (to the extent included in
the Assets) or Seller had or has the right to prosecute and/or maintain the
Patents or the right to review and/or comment on any Patent and/or
correspondence with the applicable Governmental Entity related to the Patents
and all Patents exclusively licensed to the Parent (to the extent included in
the Assets) or Seller, in each case have been prosecuted in good faith, are
subsisting and in good standing and, to the Knowledge of Parent and Seller,
disclose patentable subject matter, (B) there are no inventorship challenges to
any such Patents nor does there exist, to the Knowledge of Parent and Seller,
any fact that could lead to any such challenge, (C) no interference has been
declared or provoked relating to any such Patents nor does there exist, to the
Knowledge of Parent and Seller, any fact that could lead to such interference,
(D) no opposition proceedings have been commenced related to such Patents in
any jurisdictions which such procedures are available nor does there exist, to
the Knowledge of Parent and Seller, any fact that could lead to any such
opposition, (E) to the Knowledge of Parent and Seller, all Issued Patents in
the Seller Proprietary Rights are valid and enforceable nor does there exist,
to the Knowledge of Parent and Seller, any fact that could lead to a finding of
invalidity or unenforceability, and (F) all maintenance and annual fees have
been fully and timely paid, and all fees paid, during prosecution and after
issuance of any Patent have been paid in the correct entity status amounts,
with respect to Issued Patents within the Seller Proprietary Rights;

                        (iii)              
To the Knowledge of Parent and Seller, there is no material fact with
respect to any Patent Application in which the Parent (to the extent included
in the Assets) or Seller have any right, title or interest that would (i)
preclude the issuance of an Issued Patent from such Patent Application (with
valid claims no less broad in scope than the claims as currently pending in
such Patent Application), (ii) render any Issued Patent issuing from such
Patent Application invalid or unenforceable, or (iii) cause the claims included
in such Patent Application to be narrowed; and

                        (iv)             
No inventorship challenge, interference, or claim of invalidity or
unenforceability is pending or, to the Knowledge of Parent and Seller, threatened
with respect to Patents included in the Seller Proprietary Rights.

            (f)                
The conduct of the businesses of the Parent (solely with respect to the
Seller or the Seller Proprietary Rights) and Seller (in each case other than
the Excluded Business) as conducted prior to or on the Closing Date, including
without limitation the making, using, offering for sale, selling, otherwise
distributing or importing of any Seller Product does not infringe, constitute
contributory infringement, inducement to infringe, misappropriation or unlawful
use of Proprietary Rights of any Person, and no Person has asserted or, to the
Knowledge of Parent and Seller, threatened a claim nor do there exist, to the
Knowledge of Parent and Seller, any facts which could reasonably be expected to
give rise to such a claim, nor has the Parent or the Seller received any
notification that any Seller Product (or any Seller Proprietary Right embodied
in any Seller Product) infringes, constitutes contributory infringement,
inducement to infringe, misappropriation or unlawful use of Proprietary Rights
of any Person.

18

            (g)               
To the Knowledge of Parent and Seller, other than with respect to the
Trademarks listed on Part 3.29(a)(ii)(A)-2 of the Disclosure Schedule, there
does not exist any fact with respect to the Trademarks included in the Seller
Proprietary Rights that would (i) preclude the issuance of any Registered
Trademarks from any trademark applications, or (ii) render any such Trademarks
invalid or unenforceable.  To the Knowledge of Parent and Seller, there does
not exist any fact with respect to any Copyrights included in the Seller
Proprietary Rights that would (i) preclude the issuance of any Registered
Copyright from any copyright applications, or (ii) render any such Copyrights
invalid or unenforceable.

            (h)               
The Parent and the Seller have taken commercially reasonable and
customary measures and precautions necessary to protect and maintain the
confidentiality of all Trade Secrets in which the Parent (to the extent
included in the Assets) and Seller have any right, title or interest and
otherwise to maintain and protect the value of all such Trade Secrets.  Without
limiting the generality of the foregoing, except as set forth in Part 3.29(h)
of the Disclosure Schedule:

                        (i)                 
All current and former employees of the Seller, as well as any current
and former employees of the Parent who are or were involved in, or who have
contributed to, the creation or development of any Seller Proprietary Rights or
any Seller Product, have executed and delivered to the Parent or the Seller, as
applicable, a written agreement regarding the protection of proprietary
information and the irrevocable assignment to the Parent or the Seller, as
applicable, of any Proprietary Rights arising from services performed by such
Persons, that is substantially similar to the form of Confidential Information
and Invention Assignment Agreement previously delivered by the Seller to
Purchaser.  No such current employee of Parent or Seller and, to the Knowledge
of Parent and Seller, no such former employee of Parent or Seller, has
identified and excluded works or inventions made prior to his or her employment
with the Parent or Seller, as applicable, from his or her assignment of
inventions pursuant to such employee's Confidential Information and Invention
Assignment Agreement, or other similar agreement, entered into with Parent or
Seller, as applicable. To the Knowledge of Parent and Seller, no such current
or former employee of Seller is in violation of any term of any such agreement;

19

                        (ii)               
All current and former consultants and independent contractors to
Seller, as well as any current and former consultants and independent
contractors of the Parent, who are or were involved in, or who have contributed
to, the creation or development of any Seller Proprietary Rights or any Seller
Product have executed and delivered to the Parent or the Seller, as applicable,
a written agreement regarding the protection of proprietary information and the
irrevocable assignment to the Parent or the Seller, as applicable, of any
Proprietary Rights arising from services performed by such Persons, that is
substantially similar to the form of Consultant Confidential Information and
Invention Assignment Agreement previously delivered by the Seller to the
Purchaser.  No such current consultant or independent contractor of Parent or
Seller and, to the Knowledge of Parent and Seller, no such former consultant or
independent contractor of Parent or Seller, has identified and excluded works
or inventions made prior to his or her service with the Parent or Seller, as
applicable, from his or her assignment of inventions pursuant to such consultant
or independent contractor's Confidential Information and Invention Assignment
Agreement, or other similar agreement, entered into with Parent or Seller, as
applicable.  Part 3.29(h)(ii) of the Disclosure Schedule sets forth a list of
consultants and independent contractors used by the Parent or the Seller in
connection with the conception, reduction to practice, creation, derivation,
development, or making of any Seller Proprietary Rights or any tangible
embodiments thereof.  To the Knowledge of Parent and Seller, no current or
former consultant or independent contractor of Seller is in violation of any
term of any such agreement;

                        (iii)              
Except as disclosed as required under Section 3.29(c)(i) above and
except for disclosures made in the ordinary course of business under the
confidentiality and nondisclosure agreements listed in Section 3.29(h)(iii) of
the Disclosure Schedule, neither the Parent nor the Seller has disclosed or
delivered to any Person, or permitted the disclosure or delivery to any escrow
agent or other Person, of any Seller Source Code.  No event has occurred, and
no circumstance or condition exists, that (with or without notice or lapse of time)
will, or could reasonably be expected to, result in the disclosure or delivery
to any Person of any Seller Source Code; and

                        (iv)             
Neither the Parent nor the Seller has disclosed any Trade Secrets in
which the Parent (to the extent included in the Assets) or Seller has (or
purports to have) any right, title or interest (or any tangible embodiment
thereof) to any Person without having the recipient thereof execute a written
agreement regarding the non-disclosure and non-use thereof.

                        (v)               
Except with respect to demonstration or trial copies, no product,
system, program or software module designed, developed, distributed, licensed
or otherwise made available by the Parent (to the extent included in the
Assets) or the Seller to any Person, including without limitation any Seller
Product, contains any "back door," "time bomb," "Trojan horse," "worm," "drop
dead device," "virus" or other software routines or hardware components
installed by Parent or Seller or, to the Knowledge of Parent and Seller, any
other Person, which is designed to permit unauthorized access or to disable or
erase software, hardware or data without the consent of the user.

            (i)                 
Reserved.    

            (j)                
Except as set forth in Part 3.29(j) of the Disclosure Schedule, each
Seller Product designed, developed, manufactured, assembled, sold, installed,
repaired, licensed or otherwise made available by the Parent or the Seller to
any Person:

                        (i)                 
conformed and complied in all material respects with the terms and
requirements of any applicable warranty, the agreement related to such Seller
Products and, to the Knowledge of Seller and Parent, with all applicable legal
requirements; and

                        (ii)               
was free of any bug, virus, design defect or other defect or deficiency
at the time it was sold or otherwise made available, other than any immaterial bug
or similar defect that would not adversely affect in any material respect such
Seller Product or other asset, product or system (or the operation or
performance of either of the foregoing).

                        (iii)              
the Disclosure Schedule contains an accurate and complete copy of the
most recent "bug list" with respect to each product, system, program or
software module of each of the Seller Products.

20

            (k)              
Neither Parent nor Seller have provided any installation services,
programming services, repair services, maintenance services, support services,
training services, upgrade services or other services in each case with respect
to the Seller Products.

            (l)                 
No customer or other Person has asserted or, to the Knowledge of Parent
and Seller, threatened to assert any claim against the Parent (solely with
respect to the Seller Products) or the Seller (i) under or based upon any
warranty provided by or on behalf of the Parent (solely with respect to the
Seller Products) or the Seller, or (ii) under or based upon any other warranty
relating to any Seller Product.

            (m)             
Neither the Parent nor the Seller is or has ever been a member or
promoter of, or a contributor to or made any commitments or agreements
regarding any patent pool, industry standards body, standard setting
organization, industry or other trade association or similar organization, in
each case that could or does require or obligate the Parent or the Seller to
grant or offer to any other Person any license or right to any Proprietary
Rights, including without limitation any future Proprietary Rights developed,
conceived, made or reduced to practice by the Parent or the Seller or any
Affiliate thereof after the date of this Agreement.

            (n)               
No funding, facilities or personnel of any Governmental Entity were used
by Seller, directly or indirectly, to develop or create, in whole or in part,
any Seller Proprietary Rights or any Seller Product.

            (o)              
Except for credit terms extended in the ordinary course of business,
neither the Parent nor Seller have agreed to provide vendor financing with
respect to the sale of any Seller Products.

            (p)              
To the Knowledge of Parent and Seller, neither Parent (with respect to
Seller or any Seller Proprietary Rights) nor Seller have taken an action or
failed to take an action that operates in such a way that would give rise to a
laches or equitable estoppel claim by any Person that would result in the
avoidance of a claim of infringement by Parent or Seller against any such
Person.  In the conduct of its business, including without limitation the
using, making, selling, offering for sale or importing any Seller Products,
neither Parent (with respect to Seller or any Seller Proprietary Rights) nor
Seller are relying on any action or omission by any Person that operates in
such a way that would give rise to a laches or equitable estoppel claim by
Parent or Seller that would result in the avoidance of a claim of infringement
by Parent or Seller.

            (q)              
The information systems included in the Assets are (or as of the Closing
will be) fully functional in all material respects on a standalone basis as a
local area network only (without external connectivity to the internet or
external email or voicemail capabilities) and as of the Closing will operate
independently of all other networks and systems of Parent or Seller without any
known dependencies on such networks or systems, or services, provided by
Parent, Seller or any third party.  The equipment listed on Schedule 3.29(q)
is included in the Assets and constitutes all of the equipment required to
operate such information systems in such manner.

Section 3.30         
Labor Matters.

21

            (a)               
There is no labor strike, dispute, corporate campaign, slowdown,
stoppage or lockout actually pending, or to the Knowledge of Parent and the
Seller, threatened against or affecting the Seller, and during the past five
years there has not been any such action.

            (b)              
Neither of Parent (solely with respect to the Seller) or Seller is a
party to or bound by any collective bargaining or similar agreement with any
labor organization or work rules or practices agreed to with any labor
organization or employee association applicable to employees of the Seller.

            (c)               
No labor union has been certified by the National Labor Relations Board
as bargaining agent for any of the employees of the Seller; no notice has been
received from any labor union stating that it has been designated as the
bargaining agent for any of said employees; and no petition has been filed by
any labor union requesting an election to determine whether or not it is the
exclusive bargaining agent for any of said employees.

            (d)              
None of the employees of the Seller is represented by any labor
organization and, to the Knowledge of Parent and the Seller, there have been no
union organizing activities among the employees of the Seller within the past
five years.

            (e)               
A true and complete copy of each written personnel policy, rule and
procedure generally applicable to employees of the Seller has been delivered to
the Purchaser.

            (f)                
Each of Parent (solely with respect to the Seller) and Seller is, and
has at all times been, in compliance, in all material respects, with all
applicable laws respecting employment and employment practices, terms and
conditions of employment, wages, hours of work and occupational safety and
health.

            (g)               
There is no unfair labor practice charge or complaint against Parent
(solely with respect to the Seller) or Seller pending or, to the Knowledge of
Parent and the Seller, threatened before the National Labor Relations Board or
any similar state or foreign agency.

            (h)               
To the Knowledge of Parent and the Seller, no charge with respect to or
relating to the Parent (solely with respect to Seller's employees) or the
Seller is pending before the Equal Employment Opportunity Commission or any
other agency responsible for the prevention of unlawful employment practices.

            (i)                 
Neither Parent (solely with respect to the Seller) nor Seller has
received notice of the intent of any federal, state, local or foreign agency
responsible for the enforcement of labor or employment laws to conduct an
investigation with respect to or relating to the Seller, and no such
investigation is in progress.

            (j)                
There are no complaints, lawsuits or other proceedings pending or, to
the Knowledge of Parent and the Seller, threatened in any forum by or on behalf
of any present or former employee of the Seller, any applicant for employment
or classes of the foregoing alleging breach of any express or implied contract
of employment, any laws governing employment or the termination thereof or
other discriminatory, wrongful or tortious conduct in connection with the
employment relationship.

22

            (k)              
Since the enactment of the WARN Act, (i) neither of Parent (solely
with respect to the Seller) nor Seller has effectuated a "plant closing" (as
defined in the WARN Act) affecting any site of employment or one or more
facilities or operating units within any site of employment or facility of the
Seller, (ii) there has not occurred a "mass layoff' (as defined in the WARN
Act) affecting any site of employment or facility of the Seller, (iii) the
Seller has not been affected by any transaction or engaged in layoffs or employment
terminations sufficient in number to trigger application of any similar state,
local or foreign Law or regulation and (iv) none of the Seller's employees has
suffered an "employment loss" (as defined in the WARN Act) during the six-month
period prior to the date hereof.

Section 3.31         
Personnel.  The Disclosure Schedule sets forth a true and complete
list of the names, titles and dates of employment of all employees of the
Seller (other than the Excluded Employees).  On November 30, 2006, Seller
delivered to Purchaser a true and complete list of current salaries and other
compensation of all employees of the Seller (other than the Excluded Employees)
and the wage rates for non-salaried and non-executive salaried employees of the
Seller by classification (other than the Excluded Employees).  To the Knowledge
of Parent and the Seller, no officer, key employee or group of employees has
any plans to terminate employment with the Seller.

Section 3.32         
Potential Conflict of Interest.  Neither Seller nor, to the
Knowledge of Parent and Seller, any employee of Seller, owns or holds, directly
or indirectly, any interest in (excepting holdings of securities of publicly
held and traded entities constituting less than 5% of the equity of any such
entity), or is an officer, director, employee or consultant of any Person that
is, a competitor, lessor, lessee, customer or supplier of the Seller or which
conducts a business similar to that conducted by the Seller.  To the Knowledge
of Parent and Seller, no officer, director or employee of Parent or Seller has
any material interest in any of the Assets or any property, real or personal,
tangible or intangible, used in or pertaining to the business of the Seller.

23

Section 3.33         
Propriety of Past Payments.  To the Knowledge of Parent and
Seller (a) no unrecorded fund or asset of Seller has been established for any
purpose, (b) no accumulation or use of corporate funds of the Seller has been
made without being properly accounted for in the books and records of the
Seller, (c) no payment has been made by or on behalf of the Seller with
the understanding that any part of such payment is to be used for any purpose
other than that described in the documents supporting such payment, and (d)
none of Parent (solely with respect to the Seller) or Seller, any director,
officer, employee or agent of the Parent (solely with respect to the Seller or
any of the Assets) or Seller or any other Person associated with or acting for
or on behalf of the Parent or Seller has, directly or indirectly, made any
illegal contribution, gift, bribe, rebate, payoff, influence payment, kickback
or other payment to any Person, private or public, regardless of form, whether
in money, property or services, (i) to obtain favorable treatment for the
Parent (solely with respect to the Seller) or Seller, in securing business,
(ii) to pay for favorable treatment for business secured for the Parent (solely
with respect to the Seller) or Seller, (iii) to obtain special concessions, or
for special concessions already obtained, for or in respect of the Parent (solely
with respect to the Seller or any of the Assets) or Seller or (iv) otherwise
for the benefit of the Parent (solely with respect to the Seller of any of the
Assets) or Seller, in violation of any federal, state, local, municipal,
foreign, international, multinational or other administrative order,
constitution, law, ordinance, principle of common law, regulation, statute, or
treaty (including existing site plan approvals, zoning or subdivision
regulations or urban redevelopment plans relating to Real Property).  None of
Parent (solely with respect to the Seller or any of the Assets) or Seller or
any current director, officer, agent, employee of the Parent, Seller or other
Person acting on behalf of the Parent (solely with respect to the Seller or any
of the Assets) or Seller , has accepted or received any unlawful contribution,
payment, gift, kickback, expenditure or other item of value.

Section 3.34         
Product Liability.  There are not presently pending, or, to the
Knowledge of Parent and the Seller, threatened, and, to the Knowledge of Parent
and the Seller, there is no basis for, any civil, criminal or administrative
actions, suits, demands, claims, hearings, notices of violation,
investigations, proceedings or demand letters relating to any alleged hazard or
alleged Defect in design, manufacture, materials or workmanship, including any
failure to warn or alleged breach of express or implied warranty or
representation, relating to any Seller Product manufactured, distributed or
sold by or on behalf of the Parent (solely with respect to the Seller or any of
the Assets) or Seller.  Neither Parent (with respect to the Seller or any of
the Assets) nor Seller has extended to any of its customers any written,
non-uniform product warranties, indemnifications or guarantees.

Section 3.35         
Brokers or Finders.  No agent, broker, investment banker,
financial advisor or other firm or Person engaged by Parent or Seller is or
will be entitled to any broker's or finder's fee or any other commission or
similar fee in connection with any of the Transactions.

Section 3.36         
Full Disclosure.  Neither Parent nor Seller has failed to
disclose to Purchaser in this Agreement or the Disclosure Schedule any facts
material to the Assets or Seller's business (other than the Excluded Business). 
No representation or warranty by Parent or the Seller contained in this
Agreement, the Disclosure Schedule, certificate, or other writing furnished by
Parent or Seller to Purchaser pursuant to the provisions hereof or in
connection with the Transactions, contains any untrue statement of material
fact or omits to state any material fact necessary, in light of the
circumstances under which it was made, not misleading.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES 

OF PURCHASER

Purchaser
represents and warrant to Parent and the Seller that:

Section 4.1             
Organization.  Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of Delaware and has all requisite
corporate or other power and authority and all necessary governmental approvals
to own, lease and operate its properties and to carry on its business as now
being conducted, except where the failure to be so organized, existing and in
good standing or to have such power, authority, and governmental approvals
would not have, individually or in the aggregate, a Material Adverse Effect on
the ability of Purchaser to consummate the Transactions.

24

Section 4.2             
Authorization.  Purchaser has full corporate power and authority
to execute and deliver this Agreement and the Ancillary Agreements (to which it
will be a party) and to consummate the Transactions.  The execution, delivery
and performance by Purchaser of this Agreement and the Ancillary Agreements (to
which it will be a party) and the consummation of the Transactions have been
duly authorized by Purchaser, and no other corporate action on the part of
Purchaser is necessary to authorize the execution and delivery by Purchaser of
this Agreement, the Ancillary Agreements (to which it will be a party) or the
consummation of the Transactions.  No vote of, or consent by, the holders of
any class or series of capital stock or Voting Debt issued by Purchaser is
necessary to authorize the execution and delivery by Purchaser of this
Agreement, the Ancillary Agreements (to which it will be a party) or the
consummation by it of the Transactions.

Section 4.3             
Binding Agreement.  This Agreement has been, and the Ancillary
Agreements to which it will be a party will be, duly executed and delivered by
Purchaser and, assuming due and valid authorization, execution and delivery
hereof by Parent and Seller, this Agreement constitutes, and each Ancillary
Agreement to which it is a party will constitute, a valid and binding
obligation of Purchaser, enforceable against Purchaser in accordance with its
terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance and other similar laws of
general application affecting enforcement of creditors' rights generally and
(ii) the availability of the remedy of specific performance or injunctive or
other forms of equitable relief may be subject to equitable defenses and would
be subject to the discretion of the court before which any proceeding therefor
may be brought.

Section 4.4             
Consents and Approvals; No Violations.  Except for the filings,
permits, authorizations, consents and approvals as may be required under, and
other applicable requirements of, the Exchange Act, the HSR Act and state
securities or blue sky laws, none of the execution, delivery or performance of
this Agreement or any Ancillary Agreement to which it will be a party by
Purchaser, the consummation by Purchaser of the Transactions or compliance by
Purchaser with any of the provisions hereof will (i) conflict with or
result in any breach of any provision of the certificate of incorporation,  the
bylaws or similar organizational documents of Purchaser, (ii) require any
filing with, or permit, authorization, consent or approval of, any Governmental
Entity or other Person (including, without limitation, consents from parties to
loans, contracts, leases and other agreements to which Purchaser is a party),
(iii) require any consent, approval or notice under, or result in a violation
or breach of, or constitute (with or without due notice or the passage of time
or both) a default (or give rise to any right of termination, amendment,
cancellation or acceleration) under, any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, lease, license, contract, agreement or
other instrument or obligation to which Purchaser or any of its Subsidiaries is
a party or by which any of them or any of their respective properties or assets
may be bound, or (iv) violate any order, writ, injunction, decree, statute,
rule or regulation applicable to Purchaser, any of its Subsidiaries or any of
their properties or assets, excluding from the foregoing clauses (ii), (iii)
and (iv) such violations, breaches or defaults which would not, individually or
in the aggregate, have a Material Adverse Effect on the ability of Purchaser to
consummate the Transactions.

Section 4.5             
Brokers or Finders.  Neither Purchaser nor any of its
Subsidiaries or its Affiliates has entered into any agreement or arrangement
entitling any agent, broker, investment banker, financial advisor or other firm
or Person to any broker's or finder's fee or any other commission or similar
fee in connection with any of the Transactions.

25

ARTICLE V

COVENANTS

Section 5.1             
Interim Operations of the Seller.  Parent and the Seller hereby
covenant and agree that, from the date of this Agreement and continuing until
the earlier of the termination of this Agreement as provided herein or the
Closing, except (i) as expressly provided in this Agreement or any
Ancillary Agreement, or (ii) as may be agreed in writing by Purchaser:

            (a)               
the business of the Parent (solely with respect to the Seller and any of
the Assets) and Seller shall be conducted in substantially the same manner as
heretofore conducted and only in the ordinary course, and Parent and Seller
shall use commercially reasonable efforts to preserve the Assets and the
business organization of the Seller intact, keep available the services of the
current officers and employees of the Seller, pay or perform all obligations as
they become due and maintain the existing relations with customers, suppliers,
creditors, business partners and others having business dealings with the
Parent (solely with respect to the Seller or any of the Assets) and Seller, to
the end that the goodwill and ongoing business of the Seller shall not be
impaired in any material respect at the Closing Date.  The Parent (solely with
respect to the Seller and the Assets) and Seller shall not institute any new
methods of manufacture, purchase, sale, lease, management, accounting or
operation (including, but not limited to, with respect to the collection of
accounts receivable) or engage in any transaction or activity other than
changes in the ordinary course of business and consistent with past practice;

            (b)              
Seller shall not:  (i) amend its certificate of incorporation or
bylaws or similar organizational documents, (ii) issue, sell, transfer, or
permit the transfer of, pledge, dispose of or encumber any shares of any class
or series of its capital stock or Voting Debt, or securities convertible into
or exchangeable for, or options, warrants, calls, commitments or rights of any
kind to acquire, any shares of any class or series of its capital stock or any
Voting Debt, (iii) declare, set aside or pay any distribution payable in
any Assets with respect to any shares of any class or series of its capital
stock, (iv) split, combine or reclassify any shares of any class or series
of its capital stock, or (v) redeem, purchase or otherwise acquire
directly or indirectly any shares of any class or series of its capital stock,
or any instrument or security which consists of or includes a right to acquire
such shares;

            (c)               
none of the Parent (solely with respect to the Seller or any of the
Assets) or Seller shall modify, amend or terminate any of its material
contracts or waive, release or assign any material rights or claims, except in
the ordinary course of business and consistent with past practice,

26

            (d)              
none of the Parent (solely with respect to the Seller or any of the
Assets) or Seller shall:  (i) incur or assume any long-term debt, or
except in the ordinary course of business, incur or assume short-term
Indebtedness exceeding $50,000 in the aggregate from the date hereof until the
Closing; (ii) modify the terms of any Indebtedness or other liability,
other than modifications of short term debt in the ordinary and usual course of
business and consistent with past practice; (iii) assume, guarantee,
endorse or otherwise become liable or responsible (whether directly,
contingently or otherwise) for the obligations of any other Person, except as
described in the Disclosure Schedule as being in the ordinary course of
business and consistent with past practice; (iv) make any loans, advances
or capital contributions to, or investments in, any other Person;
(v) enter into any material commitment or transaction (including any
capital expenditure or purchase, sale or lease of assets or real estate);
(vi) write down the value of any inventory or write off as uncollectible
any notes or accounts receivable (in each case other than in the ordinary
course of business in amounts consistent with past practice); or
(vii) change any of the banking or safe deposit arrangements described or
referred to in the Disclosure Schedule;

            (e)               
neither the Parent (solely with respect to the Seller or any of the
Assets) or the Seller shall lease, license, mortgage, pledge, or encumber any
assets other than in the ordinary and usual course of business and consistent
with the past practice or transfer, sell or dispose of any assets other than in
the ordinary and usual course of business and consistent with past practice or
dispose of or permit to lapse any rights to any Seller Proprietary Rights;

            (f)                
neither of Parent (solely with respect to Seller) nor Seller shall make
any change in the compensation payable or to become payable to any of the
officers, employees, agents or consultants of the Seller (other than normal
recurring increases in the ordinary course of business consistent with past
practice in wages payable to employees who are not officers of the Seller) or
to Persons providing management services to the Seller, or enter into or amend
any employment, severance, consulting, termination or other agreement with, or
employee benefit plan for, or make any loan or advance to, any of the officers,
employees, Affiliates, agents or consultants of the Seller or make any change
in its existing borrowing or lending arrangements for or on behalf of any of
such Persons pursuant to an employee benefit plan or otherwise;

            (g)               
none of the Parent (solely with respect to the Seller) or the Seller
shall permit any insurance policy naming it as a beneficiary or a loss payable
payee to be cancelled or terminated without notice to Purchaser;

            (h)               
neither Parent (solely with respect to the Seller) nor the Seller shall
acquire any material assets or a license therefor other than in the ordinary
course of business consistent with past practices or incur any capital expenditures,
or any obligations or liabilities in connection therewith, except pursuant to
existing contracts or agreements or that, in the aggregate, would not exceed
$50,000 during any fiscal quarter;

            (i)                 
none of the Parent (solely with respect to Seller or any of the Assets)
or the Seller shall adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or other
reorganization;

            (j)                
Parent and Seller shall file, on a timely basis, with appropriate taxing
authorities all Tax Returns required to be filed prior to the Closing Date and
pay all Taxes when due;

            (k)              
none of the Parent or the Seller shall (i) change any of the
accounting methods used by it unless required by GAAP or (ii) make any election
relating to Taxes, change any election relating to Taxes already made, adopt
any accounting method relating to Taxes, change any accounting method relating
to Taxes unless required by GAAP, enter into any closing agreement relating to
Taxes, settle any claim or assessment relating to Taxes or consent to any claim
or assessment relating to Taxes or any waiver of the statute of limitations for
any such claim or assessment;

27

            (l)                 
Parent and the Seller shall continue the prosecution and registration
process with respect to any Seller Proprietary Rights in which Parent or Seller
has (or purports to have) any right, title or interest;

            (m)             
none of Parent or the Seller shall enter into or amend any agreements
pursuant to which any Seller Proprietary Rights are transferred to any Person
or any other party is granted rights of any type or scope with respect to any
of Seller's Products or Seller Proprietary Rights;

            (n)               
none of Parent (solely with respect to Seller or any of the Assets) or
the Seller shall sell, lease, license or otherwise dispose of or encumber any
of the Assets that are material, individually or in the aggregate, to Seller's
business, taken as a whole, except in the ordinary course of business
consistent with past practice;

            (o)              
neither Parent (solely with respect to Seller) nor Seller shall make any
capital expenditures, capital additions or capital improvements, in excess of
$50,000 individually or $100,000 in the aggregate;

            (p)              
none of Parent (solely with respect to Seller or any of the Assets) or
the Seller shall terminate or waive any right of substantial value, other than
in the ordinary course of business;

            (q)              
none of Parent (solely with respect to Seller or any of the Assets) or
the Seller shall commence a lawsuit other than (i) for the routine collection
of bills, (ii) in such cases where the Parent or Seller in good faith
determines that failure to commence suit would result in the material
impairment of a valuable aspect of the Assets or Seller's business, provided
that it consults with Purchaser prior to the filing of such a suit or (iii) for
a breach of this Agreement;

            (r)                
none of Parent or the Seller shall revalue any of the Assets, including
without limitation writing down the value of inventory or writing off notes or
accounts receivable other than in the ordinary course of business or as
required by changes in GAAP;

            (s)               
none of Parent or Seller shall take, or agree to or commit to take, any
action that would or is reasonably likely to result in any of the conditions to
the Closing set forth in Article VI not being satisfied, or would make any
representation or warranty of Parent or the Seller contained herein inaccurate
in any respect at, or as of any time prior to, the Closing Date, or that would
materially impair the ability of Parent, the Seller or Purchaser to consummate
the Closing in accordance with the terms hereof or materially delay such
consummation; and

            (t)                
none of Parent or Seller shall enter into any agreement, contract,
commitment or arrangement to do any of the foregoing, or authorize, recommend,
propose or announce an intention to do, any of the foregoing.

Section 5.2             
Access, Confidentiality.

28

            (a)               
Between the date of this Agreement and the Closing, Parent and Seller
shall (i) afford Purchaser and its authorized representatives reasonable
access to the Assets and the facilities of the Seller, and to all books and
records relating thereto (ii) permit Purchaser to make such inspections
and to make copies of such books and records as it may reasonably require and
(iii) furnish Purchaser with such financial and operating data and other
information concerning the Parent (solely with respect to the Seller and the
Assets) and the Seller as Purchaser may from time to time reasonably request. 
Purchaser and its authorized representatives shall use reasonable efforts to
conduct all such inspections in a manner that will minimize disruptions to the
business and operations of the Parent and the Seller.

           (b)              
Purchaser and its authorized representatives (including its designated
engineers, or consultants) may at reasonable times and with Parent's prior
consent (which may be either oral or written), which consent shall not be
unreasonably withheld, enter into and upon all or any portion of the Assets in
order to investigate and assess the environmental condition of the Assets and
such properties or the business of the Seller conducted thereat.  Such
investigation by Purchaser may include the performance of noninvasive and
nondestructive tests or other procedures (hereinafter "Phase II Testing")
relating to environmental conditions or Materials of Environmental Concern and
Purchaser shall provide to Parent and Seller any scope of work relating to such
Phase II Testing prepared by an environmental consulting firm for Parent's
and Seller's review.  Purchaser shall not conduct any Phase II Testing without
receipt of Parent's and Seller's approval.  Parent and Seller shall cooperate
with Purchaser and its authorized representatives in conducting such
investigation and shall allow Purchaser and its authorized representatives full
access to the Assets and their properties and businesses.

            (c)               
The provisions of the Confidentiality Agreement, to which Seller by
signing this Agreement agrees to be bound, are hereby incorporated herein and
shall remain binding and in full force and effect, except that the
Confidentiality Agreement shall not apply to any documents prepared in
connection with a proceeding before or filed with, or other disclosure made to,
a court, arbitration tribunal or mediation service in order to enforce any
party's rights arising in connection with the termination of this Agreement
pursuant to Section 7.2.  All obligations of the Purchaser under the
Confidentiality Agreement with respect to the Assets purchased and Assumed
Contracts shall terminate simultaneously with the Closing.  Except as otherwise
provided herein or in the Ancillary Agreements, Parent and Seller shall, and
shall cause their Subsidiaries and the consultants, advisors and
representatives of itself and each of their Subsidiaries to, treat after the
date hereof as strictly confidential (unless compelled to disclose by judicial
or administrative process or, in the opinion of legal counsel, by other
requirements of law) all nonpublic, confidential or proprietary information
concerning the Seller (other than the Excluded Assets and the Retained Know-How
Rights) and the Assets, and Parent and the Seller shall not, and shall cause
their Subsidiaries and the consultants, advisors and representatives of itself
and each of their Subsidiaries not to, after the date hereof, use such
information to the detriment of the Purchaser.

Section 5.3             
Efforts and Actions to Cause Closing to Occur.

29

            (a)               
Prior to the Closing, upon the terms and subject to the conditions of
this Agreement, Purchaser, Parent and the Seller shall use their respective
reasonable best efforts to take, or cause to be taken, all actions, and to do,
or cause to be done and cooperate with each other in order to do, all things
necessary, proper or advisable (subject to any applicable laws) to consummate
the Closing and the other Transactions as promptly as practicable including, but
not limited to the preparation and filing of all forms, registrations and
notices required to be filed to consummate the Closing and the other
Transactions and the taking of such actions as are necessary to obtain any
requisite approvals, authorizations, consents, orders, licenses, permits,
qualifications, exemptions or waivers by any third party or Governmental
Entity.  In addition, no party hereto shall take any action after the date
hereof that could reasonably be expected to materially delay the obtaining of,
or result in not obtaining, any permission, approval or consent from any
Governmental Entity or other Person required to be obtained prior to Closing.

            (b)              
Prior to the Closing, each party shall promptly consult with the other
parties hereto with respect to, provide any necessary information with respect
to, and provide the other parties (or their respective counsel) with copies of,
all filings made by such party with any Governmental Entity or any other
information supplied by such party to a Governmental Entity in connection with
this Agreement and the Transactions.  Each party hereto shall promptly inform
the other parties of any communication received by such party from any
Governmental Entity regarding any of the Transactions.  If any party hereto or
Affiliate thereof receives a request for additional information or documentary
material from any such Governmental Entity with respect to any of the
Transactions, then such party shall endeavor in good faith to make, or cause to
be made, as soon as reasonably practicable and after consultation with the
other parties, an appropriate response in compliance with such request.  To the
extent that transfers, amendments or modifications of permits (including
environmental permits) are required as a result of the execution of this
Agreement or consummation of any of the Transactions, Parent and Seller shall
use commercially reasonable efforts to effect such transfers, amendments or
modifications as soon as reasonably practicable.

            (c)               
Parent and Seller shall use diligent and commercially reasonable efforts
to obtain, prior to the Closing, (i) the unconditional consent to the
Closing and the other Transactions of each lender to whom Parent (solely with
respect to the Seller or any of the Assets) or Seller owes any Indebtedness if
such consent is required under the instrument evidencing such Indebtedness,
(ii) the unconditional release of each Person holding a mortgage or lien
on any of the Assets; (iii) the unconditional consent to the Closing and
the other Transactions of each lessor under each Lease relating to Real
Property; (iv) the Required Contract Consents, and (v) the
unconditional consent to the Closing and the other Transactions of each other
party to each material contract (other than contracts included as a Required
Contract Consent) with Parent (solely with respect to the Seller or any of the
Assets) or Seller but only if and to the extent the failure to obtain such
consent would materially and adversely affect the Parent or Seller, or the
ability of Parent, Seller or Purchaser to consummate the Transactions or of
Purchaser to conduct the business of Seller relating to the Assets following
the Closing in substantially the same manner as conducted by Seller prior to
the Closing.  All such releases and consents shall be in writing and executed
counterparts thereof shall be delivered to Purchaser at or prior to the
Closing.

            (d)              
In addition to and without limiting the agreements of the parties
contained above, Parent, Seller and Purchaser shall take promptly all actions
necessary to make the filings required of them or any of their Affiliates under
the HSR Act (if any) and use all commercially reasonable efforts to resolve
such objections, if any, that may be asserted with respect to the Transactions
under any antitrust law.

30

            (e)               
Nothing in this Agreement shall be deemed to require any party
(i) to divest or hold separate any assets or agree to limit its future
activities, method or place of doing business (except as specifically set forth
in this Agreement), (ii) to commence any litigation against any entity in
order to facilitate the consummation of any of the Transactions or
(iii) to defend against any litigation brought by any Governmental Entity
seeking to prevent the consummation of, or impose limitations on, any of the Transactions.

Section 5.4             
Notification of Certain Matters.

            (a)               
From time to time prior to the Closing, Parent and/or Seller shall
promptly supplement or amend the Disclosure Schedule with respect to any matter
arising after the delivery thereof pursuant hereto that, if existing at, or
occurring on, the date of this Agreement, would have been required to be set
forth or described in the Disclosure Schedule.  No supplement or amendment of
the Disclosure Schedule made after the execution hereof by Purchaser pursuant
to this section or otherwise shall be deemed to cure any breach of any
representation of or warranty made pursuant to this Agreement, except to the
limited extent provided in Section 8.1(f).

            (b)              
Purchaser on the one hand and Parent and Seller on the other hand shall
give notice to each other promptly after becoming aware of (i) the
occurrence or non-occurrence of any event whose occurrence or non-occurrence
would be likely to cause either (A) any representation or warranty of such
party contained in this Agreement to be untrue or inaccurate in any material
respect at any time from the date hereof to the Closing Date or (B) any
condition set forth in Article VI to be unsatisfied in any material
respect at any time from the date hereof to the Closing Date and (ii) any
failure of Parent or Seller, to comply with or satisfy in any material respect
any covenant, condition or agreement to be complied with or satisfied by it
hereunder; provided, however, that (x) the delivery of any
notice pursuant to this section shall not limit or otherwise affect the
remedies available hereunder to the party receiving such notice and
(y) the failure to give such notice shall not be required from and after
the time the party to whom such notice is to be given has actual knowledge of
the information required to be included in such notice.

            (c)               
Parent and Seller shall deliver to Purchaser copies of (i) all
audit reports, letter rulings, technical advice memoranda and similar documents
issued by a Governmental Entity relating to the United States federal, state,
local or foreign Taxes due from or with respect to Parent (solely with respect
to the Seller or any of the Assets) or Seller and (ii) any closing
agreements entered into by or on behalf of Parent or Seller relating to Parent
(solely with respect to the Seller or any of the Assets) or Seller with any
taxing authority, which come into the possession of Parent or Seller after the
date hereof.

Section 5.5             
No Solicitation of Competing Transaction.

31

            (a)               
None of Parent or Seller shall (and Parent and Seller shall cause the
officers, directors, employees, representatives and agents of Parent and Seller
including investment bankers, attorneys and accountants, not to), directly or
indirectly, encourage, solicit, participate in or initiate discussions or
negotiations with, or provide any information to, any Person or group (other
than Purchaser, any of its Affiliates or representatives) concerning any
Acquisition Proposal.  None of Parent or Seller shall approve or recommend, or
propose to approve or recommend any Acquisition Proposal, or enter into any
agreement with respect to any Acquisition Proposal.  Upon execution of this
Agreement, Parent and Seller shall immediately cease any existing activities,
discussions or negotiations with any parties conducted heretofore with respect
to any of the foregoing and Parent and Seller shall request (or if Parent or
Seller has the contractual right to do so, demand) the return of all documents,
analyses, financial statements, projections, descriptions and other data
previously furnished to others in connection with Parent or Seller's efforts in
connection with such potential transaction.  Parent and/or Seller shall
immediately notify Purchaser of the existence of any Acquisition Proposal or
inquiry received by Parent and/or Seller, and Parent and/or Seller shall
immediately communicate to Purchaser the terms of any proposal or inquiry which
Parent and/or Seller may receive (and shall immediately provide to Purchaser
copies of any written materials received by Parent and/or Seller in connection
with such proposal, discussion, negotiation or inquiry) and the identity of the
party making such proposal or inquiry.

            (b)              
None of the Parent's or Seller's Board of Directors or any committee
thereof shall (i) withdraw or modify, or propose to withdraw or modify, in
a manner adverse to Purchaser, the approval by such Board of Directors or any
such committee of this Agreement or the Transactions, (ii) approve or
recommend or propose to approve or recommend any Acquisition Proposal or
(iii) authorize Parent or Seller to enter into any agreement with respect
to any Acquisition Proposal.

Section 5.6             
Hiring by Purchaser.  Purchaser may offer employment to such of
the employees of the Seller, other than the individuals set forth on Schedule
5.6 hereto, as it may deem desirable or in its best interests to hire, but
shall not be obligated to hire any employees of the Seller.  Purchaser shall be
free in its sole discretion to hire persons previously employed by Seller.

Section 5.7             
No Assumption of Labor Liabilities.  Purchaser shall not assume
any labor agreements or any liabilities thereunder or the fringe benefit plans
or any other liabilities which Parent or Seller may have with respect to any
union or the employees of the Seller (including former employees) either on the
date hereof or the date of the Closing, including liabilities of Parent or
Seller with respect to payment of wages or pensions which may have accrued,
vested or been earned prior to the Closing and liabilities of Parent or Seller
to contribute to pension or other fringe benefit plans with respect to or on
account of service prior to the Closing, and/or any other term or condition of
employment presently enjoyed by employees of the Seller.

32

Section 5.8             
Seller's Non-Compete.  Without the express prior written consent
of Purchaser, none of Parent or Seller or any Subsidiary of Parent or Seller
shall, at any time during the two-year period immediately following the Closing
Date, directly or indirectly, own, manage, control or participate in the
ownership, management or control of, any business that designs, develops or
sells products that implement or utilize Bluetooth wireless technology in any
portable or mobile communications devices, other than the sale, support and
maintenance of existing products that are Excluded Assets.  Parent and Seller
hereby agree that none of the Parent or Seller or any Subsidiary of Parent or
Seller will at any time during the two‐year period immediately following
the Closing Date, solicit, seek to employ or otherwise hire any Person employed
by Purchaser, or any Subsidiary of Purchaser, who is or was previously employed
by Seller, or who worked on the Transactions on behalf of the Purchaser; provided,
however, that general advertising and public notices in the ordinary
course of business shall not be deemed to be a violation of the foregoing.

Section 5.9             
Subsequent Actions.

            (a)               
If at any time after the Closing Purchaser determines it is advisable
that any deeds, bills of sale, instruments of conveyance, power of attorney,
assignments, assurances or any other actions or things are necessary or
desirable to vest, perfect or confirm ownership (of record or otherwise) in
Purchaser, its right, title or interest in, to or under any or all of the
Assets (including, but not limited to, any Additional Proprietary Rights) or
otherwise to carry out this Agreement, Parent and/or Seller shall promptly
execute and deliver all deeds, bills of sale, instruments of conveyance, powers
of attorney, assignments and assurances and take and do all such other actions
and things as may be reasonably requested by Purchaser in order to vest,
perfect or confirm any and all right, title and interest in, to and under such
rights, properties or assets in Purchaser or otherwise to carry out this
Agreement.

            (b)              
After the Closing, each of Purchaser, the Parent and Seller shall:

                        (i)                 
cooperate fully in preparing any Tax Returns of the Parent (solely with
respect to the Seller or any of the Assets) and Seller and preparing for any
audits of, or disputes or litigation with taxing authorities regarding, any Tax
Returns with respect to the Parent (solely with respect to the Seller or any of
the Assets) and Seller;

                        (ii)               
make available to the others and to any taxing authority as reasonably
requested all information and documents relating to Taxes of the Parent (solely
with respect to the Seller or any of the Assets) and Seller;

                        (iii)              
provide timely notice to the others in writing of any pending or
threatened tax audits, assessments or litigation with respect to the Parent
(solely with respect to the Seller or any of the Assets) or Seller for any
taxable period for which the other party may have liability under this
Agreement; and

                        (iv)             
furnish the others with copies of all correspondence received from any
taxing authority in connection with any tax audit or information request
relating to the Assets or the Seller with respect to any taxable period for
which the other may have liability under this Agreement.

            (c)               
In case at any time after the Closing Date any further action is
necessary, proper or advisable to carry out the purposes of this Agreement, as
soon as reasonably practicable, each party hereto shall take, or cause its
proper officers or directors to take, all such necessary, proper or advisable
actions.

33

Section 5.10         
Publicity.  The initial press release with respect to the
execution of this Agreement shall be a joint press release with respect to this
Agreement and the Transactions acceptable to Purchaser, Parent and Seller. Thereafter,
unless otherwise permitted by this Agreement, none of Parent, Seller, Purchaser
nor any of their respective Affiliates shall issue or cause the publication of
any press release or other public announcement or non-confidential disclosure
(whether or not in response to an inquiry) with respect to this Agreement or
the Transactions (or the terms hereof or thereof) without prior approval of the
other party (which approval shall not be unreasonably withheld), except in
response to a valid order of or request by a court, regulatory agency or other
Governmental Entity as may be required by law.

Section 5.11         
Mail Received After Closing.  Following the Closing, Purchaser
may receive and open all mail addressed to the Parent or Seller and deal with
the contents thereof in its discretion to the extent that such mail and the
contents thereof relate to the Assets, Assumed Contracts or any of the
obligations or liabilities assumed or incurred by Purchaser pursuant to this
Agreement.  Purchaser shall promptly deliver or cause to be delivered to Parent
or Seller all mail received by Purchaser after the Closing addressed to Parent
or Seller or any Subsidiary of Parent which does not relate to such matters.

Section 5.12         
Access to Books and Records.

            (a)               
On and after the Closing, during normal business hours, and upon
reasonable prior notice Parent and Seller will permit Purchaser and its
auditors, through their authorized representatives, to have reasonable access
to and examine and make copies of books and records of Parent and Seller
relating to the Seller, the Assets or any of the Assumed Liabilities which are
not delivered to Purchaser pursuant hereto (including correspondence, memoranda,
books of account and the like) and relating to events occurring prior to the
date hereof and to transactions or events occurring prior to the date hereof.

            (b)              
Purchaser shall cooperate with Parent and Seller, at Parent's expense,
and make available to Parent and Seller such documents, books, records or
information transferred to Purchaser and relating to the Assets or Assumed
Liabilities or to activities of the Parent or Seller prior to the Closing as
Parent or Seller may reasonably require after the Closing in connection with
any tax determination or contractual obligations to third parties or to defend
or prepare for the defense of any claim against Parent or Seller or to
prosecute or prepare for the prosecution of claims against third parties by Parent
or Seller relating to the conduct of the business of the Seller prior to the
Closing or in connection with any governmental investigation of Parent, Seller
or any of its Affiliates.

            (c)               
Each party will direct its employees to render any assistance which the
other party may reasonably request in examining or utilizing records referred
to in this section, provided that each party shall be reimbursed by the other
for any out-of-pocket expenses which it may incur in rendering the services
provided for in this section.  Each party agrees not to destroy any files or
records which are subject to this section without giving reasonable notice to
the other, and within 15 days of receipt of such notice, such other party may
cause to be delivered to it the records intended to be destroyed, at such other
party's expense.

Section 5.13         
Consignment Assets.  Parent and Seller will obtain, prior to the
Closing, an acknowledgment from each supplier holding patterns, dies, tooling
or other property included in the Assets for the benefit of Seller that such
patterns, dies, tooling or other property or Assets will be held for the
benefit of Purchaser following the Closing.

34

Section 5.14         
Waiver of Bulk Sales Requirement.  Each of the parties waives
compliance with any applicable bulk sales laws, including without limitation
the Uniform Commercial Code Bulk Transfer provisions.  Parent and Seller agree
to pay and discharge in due course all claims made by creditors of Parent
and/or Seller, except those expressly assumed by Purchaser pursuant hereto.

Section 5.15         
Accounts Receivable.  If a debtor on any account receivable which
is an Excluded Asset is also a debtor to Purchaser for shipments subsequent to
the Closing and such debtor shall make any remittance, such remittance shall be
deemed to be on account of the earliest unpaid invoice rendered to such debtor
unless otherwise specifically designated by an account debtor who is contesting
such earliest first invoice, in which event Purchaser shall give prompt notice
therefor to Parent and/or Seller.  Parent and/or Seller shall promptly deliver
(and endorse, if necessary) to Purchaser any checks or other payments which it
receives on account of goods sold or shipped by Purchaser or which relate to
the Assets.  Purchaser shall promptly deliver (and endorse, if necessary) to Parent
and/or Seller any checks or other payments which it receives on account of
goods sold or shipped by Parent and/or Seller prior to the Closing if the
account receivable to which such payment relates is an Excluded Asset.

Section 5.16         
Preparation and Filing of Tax Returns; Payment of Taxes.  To the
extent not filed prior to the Closing Date, Parent and Seller shall prepare (or
cause to be prepared), at its own cost and expense and in a manner consistent
with past practice, all Tax Returns required to be filed by Parent or Seller
with respect to the Assets for all Pre-Closing Periods.  Not less than twenty
(20) business days prior to the date on which each such tax return is due to be
filed (taking into account any applicable extensions), Parent or Seller, as
applicable, shall deliver a draft of each such Tax Return to Purchaser for its
review and consent.  Parent or Seller shall timely file (or cause to be timely
filed) such Tax Return and Parent or Seller shall timely pay the amount due
with the Tax Return to the appropriate taxing authority.

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Section 5.17         
Seller Facility.  Commencing upon the Closing and terminating on
the latest to occur of (a) December 29, 2006, (b) the fifth business day
following the Closing Date and (c) such other date as may be agreed in writing
by Purchaser and Seller, Purchaser and its employees (including, but not
limited to, the former employees of Seller) shall be entitled to utilize the
Seller Facility in order to permit the orderly transition and relocation of all
such employees to Purchaser's facilities.  During such period, Purchaser and
its employees shall be free to use at the Seller Facility (at Purchaser's sole
risk) the office supplies, telephones, facsimile machines, scanners, copiers,
conference rooms, printers, servers, software and other office equipment and
services located at the Seller Facility, which will be substantially equivalent
to the equipment located at the Seller Facility prior to the Closing. 
Purchaser shall use commercially reasonable efforts to vacate the Seller
Facility as soon as reasonably practicable, and shall be responsible for any
damage or injury to persons or property arising out of such use of the Seller
Facility.  Purchaser shall, within thirty (30) days of receipt of an invoice from
Seller, reimburse Seller for the payment of rent for the Seller Facility during
the six-month period following the Closing Date (as such rent is in effect as
of the date hereof); provided, however, that the obligation of
the Purchaser shall be reduced or eliminated to the extent that the Seller is
able to sublease or assign the lease of the Seller Facility, or otherwise
collects or is relieved of amounts relating to such rental obligation; and, provided
further, that Seller and the Parent shall use commercially reasonable
efforts to sublease or assign the lease of the Seller Facility for the periods
following such time as Purchaser and its employees vacate the premises, and to
take such other action reasonably necessary to mitigate Parent's or Seller's
rental obligations under such lease and the Purchaser's obligations hereunder. 
Each party shall execute and deliver any documents and take any other action
reasonably requested or required to effect the intent of this Section 5.17.  

Section 5.18         
Purchase Price Allocation.  Purchaser, Parent and Seller shall
negotiate in good faith to reach an agreement, within sixty (60) days following
the Closing, regarding the allocation of the Purchase Price among the Assets in
compliance with Section 1060 of the Code and the regulations promulgated
thereunder. To the extent an agreement is reached among the parties regarding
the allocation of the Purchase Price, Purchaser, Parent and Seller shall (i)
timely file all forms (including Internal Revenue Service Form 8594 and any
required amendments) and Tax Returns required to be filed in connection with
such allocation, (ii) be bound by such allocation for purposes of determining
Taxes, (iii) prepare and file, and cause its Affiliates to prepare and file,
its Tax Returns on a basis consistent with such allocation and (iv) take no
position, and cause its Affiliates to take no position, inconsistent with such
allocation on any applicable Tax Return, in any audit or proceeding before any
taxing authority, in any report made for Tax, financial accounting or any other
purposes, or otherwise.  In the event that the allocation agreed upon by the
parties is disputed by any taxing authority, the party receiving notice of such
dispute shall promptly notify the other party hereto concerning the existence
and resolution of such dispute.

Section 5.19         
Financial Information.  Parent and Seller shall deliver to
Purchaser, within ten (10) days following the Closing, detailed schedules
setting forth the value of, and other requested information relating to, the
following items with respect to the business of Seller and the Assets: (i)
accounts receivable as of the Closing Date, including aging with customer
details, together with copies of all outstanding invoices related thereto; (ii)
inventory, including a breakdown between work in progress and finished goods;
(iii) all prepayments, including with respect to prepaid software and other
expenses, and detailed descriptions thereof; (iv) fixed assets, including a
complete listing of such assets (including those on the books and those that
have otherwise been expensed); (v) other assets (if any); and (vi) open
purchase orders with a detailed list which sets forth the purchase order
number, date, other party and amount of each purchase order, together with
copies of all such purchase orders.

Section 5.20         
Retained Rights.  From and after the Closing, Parent and Seller
shall comply with the obligations set forth in Exhibit C with respect to
the Retained Know-How Rights.  From and after the Closing, Parent and
Seller shall retain the nonexclusive, royalty-free right to use the Registered
Trademarks "SiW" and "SILICON WAVE" in connection with the continued marketing
and sale of Seller Products in the Excluded Business in accordance with the
term of this Agreement and substantially consistent with past practice, subject
to compliance with Purchaser's trademark guidelines that may be reasonably in
effect from time to time and provided to Parent.

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Section 5.21         
Additional Proprietary Rights.  If following the Closing Parent
or Seller locates any copies of Bluetooth Know-How (in any format or media),
then Parent or Seller shall promptly notify the Purchaser in writing and shall
comply with any request from the Purchaser to deliver to the Purchaser or
destroy (and certify in writing to Purchaser the destruction thereof) of such
Bluetooth Know-How (subject to the Retained Know-How Rights).

ARTICLE VI

CONDITIONS

Section 6.1             
Conditions to Each Party's Obligation to Effect the Closing.  The
respective obligation of each party to effect the Closing shall be subject to
the satisfaction at or prior to the Closing Date of each of the following
conditions:

            (a)               
No Injunctions or Restraints; Illegality.  No temporary
restraining order, preliminary or permanent injunction or other order issued by
any court of competent jurisdiction or other legal or regulatory restraint or
prohibition preventing the consummation of the Transactions shall be and remain
in effect, nor shall any proceeding brought by any Governmental Entity seeking
any of the foregoing be pending, which could reasonably be expected to have a
Material Adverse Effect, either individually on one party or combined with two
or more parties, nor shall there be any action taken, or any statute, rule,
regulation or order enacted, entered, enforced or deemed applicable to the
Transactions, which makes the consummation of the Transactions illegal.

            (b)              
Governmental Approval.  Purchaser, Parent and Seller shall have
timely obtained from each Governmental Entity all approvals, waivers and
consents, necessary for consummation of the Transactions in at the Closing,
including, without limitation, such approvals, waivers and consents as may be
required under HSR.

Section 6.2             
Conditions to Obligations of Purchaser to Effect the Closing. 
The obligations of Purchaser to consummate the Closing shall be subject to the
satisfaction on or prior to the Closing Date of each of the following
conditions:

            (a)               
Government Action.  There shall not be threatened or pending any
suit, action or proceeding by any Governmental Entity:

                        (i)                 
seeking to prohibit or impose any material limitations on Purchaser's
ownership or operation (or that of any of its Subsidiaries or Affiliates) of
all or a material portion of their businesses or assets or the Assets, or to
compel Purchaser or any of its Subsidiaries or Affiliates to dispose of or hold
separate any material portion of Assets or the business or assets of Purchaser
or any of its Subsidiaries or Affiliates,

                        (ii)               
seeking to restrain or prohibit the consummation of the Closing or the
performance of any of the other Transactions, or seeking to obtain from
Purchaser or any Subsidiary of Purchaser any damages that are material (in the
sole determination of the Purchaser),

                        (iii)              
seeking to impose material limitations on the ability of Purchaser, or
any Subsidiary of the Purchaser, or rendering Purchaser unable to accept for
payment or pay for or purchase some or all of the Assets or otherwise to
consummate the Closing,

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                        (iv)             
seeking to impose material limitations on the ability of Purchaser
effectively to exercise full rights of ownership of the Assets,

                        (v)               
which otherwise is reasonably likely to have a Material Adverse Effect,
or

                        (vi)             
any other action taken by any Governmental Entity, other than the
application to the Transactions of applicable waiting periods under the HSR
Act, that is reasonably likely to result, directly or indirectly, in any of the
consequences referred to in clauses (i) through (v) above.

            (b)              
Representations, Warranties and Covenants.  The representations
and warranties of Parent and Seller in this Agreement shall be true and correct
in all material respects (without regard to any qualification as to materiality
contained in such representation or warranty), on and as of the date of this
Agreement and on and as of the Closing as though such representations and
warranties were made on and as of such time (except for such representations
and warranties that speak specifically as of the date hereof or as of another
date, which shall be true and correct as of such date); provided, however,
that the satisfaction of the condition set forth in this Section 6.2(b) shall
be determined without regard to any Transaction Event.

            (c)               
Performance of Obligations.  Parent and Seller shall have
performed and complied in all material respects with all covenants, obligations
and conditions of this Agreement required to be performed and complied with by
it as of the Closing.

            (d)              
Certificate of Officers.  Purchaser shall have received a
certificate from each of Parent and Seller, executed on behalf of each such
party hereto by the chief executive officer and chief financial officer of
Parent and Seller, respectively, certifying that the conditions set forth in
Sections 6.2(b) and 6.2(c) have been satisfied.

            (e)               
Transfer Documents.  All documentation pursuant to which the
Transactions are to be accomplished, including bills of sale, assignments and
other documents or instruments of transfer, shall have been presented to
Purchaser and their counsel for review and shall have been consistent with this
Agreement and reasonably satisfactory in form and substance to Purchaser and
their counsel prior to the consummation of the Transactions.  All of the Assets
shall have been transferred or assigned from Parent and/or Seller to Purchaser
free and clear of all Encumbrances (except Permitted Encumbrances, Encumbrances
disclosed in this Agreement or the Disclosure Schedule, Assumed Liabilities and
the Retained Know-How Rights), and Purchaser and its counsel shall have
received evidences of such transfers reasonably satisfactory to them.

            (f)                
No Other Litigation.  There shall not be pending any legal
proceeding: (i) challenging or seeking to restrain or prohibit the consummation
of the Transactions; (ii) relating to the Transactions and seeking to obtain
from Purchaser any damages or other relief that would be material to Purchaser;
or (iii) which would affect adversely the right of Purchaser to acquire and own
the Assets.

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            (g)               
Employees.  The Seller shall have terminated, as of and
conditioned upon Closing, the employment of all Seller employees offered
employment by the Purchaser, and as of Closing at least ninety percent (90%) of
such employees shall have agreed to accept employment with Purchaser, in each
case on terms acceptable to Purchaser set forth in an offer letter in the form
provided by Purchaser and each such individual shall have executed and
delivered to Purchaser an offer letter in a form provided by Purchaser and a Proprietary
Rights and Non-Disclosure agreement in the form provided by Purchaser; provided,
however, that such ninety percent (90%) calculation shall not include
any employee unless such employee's employment offer with Purchaser includes
initial cash compensation no less favorable than such employee's cash
compensation from Seller as of the date of this Agreement.

            (h)               
Joint Defense Agreement.  The Purchaser, Parent and the Seller
shall have entered into a Joint Defense Agreement in the form attached hereto
as Exhibit A.

            (i)                 
Indemnity Claims Agreement.  The Purchaser and Parent shall have
entered into the Agreement Regarding Certain Indemnity Claims in the form
attached hereto as Exhibit B.

            (j)                
Amendment of License Agreement.  The agreements set on Schedule
6.2(j) shall have been amended, effective as of the Closing, to provide for
separate rights of Purchaser on the one hand and Seller and Parent on the other
hand, as set forth on Schedule 6.2(j).

            (k)              
Ancillary Agreements.  Parent and Seller shall have executed and
delivered to Purchaser each of the Ancillary Agreements to which it is a party.

            (l)                 
Consents Obtained.  All consents and approvals of any Person
necessary to the consummation of the Closing and the other Transactions,
including Required Contract Consents and approvals from parties to loans,
contracts, Leases or other agreements and consents and approvals from
governmental agencies, whether federal, state or local shall have been
obtained, and a copy of each such consent or approval shall have been provided
to Purchaser at or prior to the Closing.

            (m)             
Disruption of Financial Markets.  There shall not have occurred
and be continuing on the Closing Date (i) any general suspension of
trading in, or limitation on prices for, securities on the New York Stock
Exchange (excluding suspensions or limitations resulting solely from physical
damage or interference with such exchanges not related to market conditions),
(ii) a declaration of a banking moratorium or any suspension of payments
in respect of banks in the United States (whether or not mandatory),
(iii) a war, armed hostilities or other international or national calamity
directly or indirectly involving the United States or (iii) any limitation
(whether or not mandatory) by any United States or foreign governmental authority
on the extension of credit by banks or other financial institutions;

            (n)               
Material Adverse Change.  There shall not have occurred any
Material Adverse Effect, or any development that is reasonably likely to result
in any Material Adverse Effect, other than a Transaction Event.

            (o)              
Reserved.  

39

            (p)              
FIRPTA Certificate.  Purchaser shall have received (i) a
certification of non-foreign status for the Seller in the form and manner which
complies with the requirements of Section 1445 of the Code and the regulations
promulgated thereunder and (ii) any other certifications which may be
required under applicable law stating that no Taxes are due to any taxing
authority for which the Purchaser could have liability to withhold and pay with
respect to the transfer of the Assets;

            (q)              
Termination.  The Transactions shall not have been terminated or
abandoned in accordance with the terms of this Agreement.

            (r)                
Legal Opinion.  Womble Carlyle Sandridge & Rice, PLLC,
counsel to Parent and Seller, shall have delivered to Purchaser an executed
copy of the opinion, dated as of the Closing Date, in the form attached hereto
as Exhibit D.

            (s)               
Seller's Closing Deliverables.  At the Closing, Parent and Seller
will deliver to Purchaser the following items:

                        (i)                 
assignments and assumptions of contracts and such other good and
sufficient instruments of conveyance, assignment and transfer, in form and
substance reasonably satisfactory to counsel to Purchaser as shall be legally
sufficient to vest in Purchaser, as applicable, good and marketable title to
the Assets (including the Assumed Contracts);

                        (ii)               
assignments of all of Seller Proprietary Rights (subject to the Retained
Know-How Rights), including, but not limited to, the Patent Assignments in the
form attached hereto as Exhibit E, and the Trademark Assignments in
the form attached hereto as Exhibit F;

                        (iii)              
duly executed Certificates of Officers from Parent and Seller in
accordance with Section 6.2(d) hereof;

                        (iv)             
all executed copies of the consents referred to in Section 5.3(c) hereof
and all other Required Contract Consents;

                        (v)               
the executed opinion of counsel to Parent and Seller in accordance with
Section 6.2(s) hereof;

                        (vi)             
a duly executed Bill of Sale, Assumption Agreement and each of the other
Ancillary Agreements;

                        (vii)            
all of the books and records of Parent and Seller relating to the
Assets;

                        (viii)          
a certification of non-foreign status for the Parent and Seller in the
form and manner which complies with the requirements of Section 1445 of the
Code and the regulations promulgated thereunder;

40

                        (ix)             
any other certifications which may be required under applicable law
stating that no Taxes are due to any taxing authority for which the Purchaser
could have liability to withhold and pay with respect to the transfer of the
Assets; and

                        (x)               
all other documents required to be delivered to Purchaser under the
provisions of this Agreement.

The foregoing conditions are
for the sole benefit of Purchaser and may be waived by Purchaser, in whole or
in part, at any time and from time to time in the sole discretion of
Purchaser.  The failure by Purchaser at any time to exercise any of the
foregoing rights shall not be deemed a waiver of any such right and each such
right shall be deemed an ongoing right which may be asserted at any time and
from time to time.

Section 6.3             
Conditions to Obligations of Parent and the Seller.  The
obligations of the Parent and the Seller to effect the Transactions are, at the
option of Parent and the Seller, subject to the satisfaction at or prior to the
Closing of the following additional conditions:

            (a)               
Representations, Warranties and Covenants.  The representations
and warranties of Purchaser in this Agreement shall be true and correct in all
material respects (without regard to any qualification as to materiality
contained in such representation or warranty), on and as of the date of this
Agreement and on and as of the Closing as though such representations and
warranties were made on and as of such time (except for such representations
and warranties that speak specifically as of the date hereof or as of another
date, which shall be true and correct as of such date).

            (b)              
Performance of Obligations.  Purchaser shall have performed and
complied in all material respects with all covenants, obligations and
conditions of this Agreement required to be performed and complied with by it
as of the Closing.

            (c)               
Certificate of Officer.  Parent and Seller shall have received a
certificate from Purchaser executed on behalf of Purchaser by an officer of
Purchaser certifying that the conditions set forth in Sections 6.3(a) and
6.3(b) have been satisfied.

            (d)              
Delivery of Purchase Price.  Purchaser shall have delivered the Purchase
Price to Seller in accordance with Section 1.2 hereof.

            (e)               
Ancillary Agreements.  Purchaser shall have executed and
delivered to Parent and Seller each of the Ancillary Agreements to which it is
a party.

            (f)                
Purchaser's Closing Deliverables.  At the Closing, Purchaser will
deliver to Seller the following items:

                        (i)                 
the Purchase Price, subject to adjustment as provided in
Section 1.2 above;

                        (ii)               
the Certificate of Officer in accordance with Section 6.3(c) hereof;

                        (iii)              
a duly executed copy of the Assumption Agreement;

41

                        (iv)             
duly executed copies of each other Ancillary Agreements to be executed
and delivered by Purchaser; and

                        (v)               
such other documents as are required to be delivered by Purchaser to
Parent and/or the Seller pursuant to this Agreement.

ARTICLE VII

TERMINATION

Section 7.1             
Termination.  This Agreement and Transactions may be terminated
or abandoned at any time prior to the Closing Date:

            (a)               
By the mutual written consent of Purchaser, Parent and Seller;

            (b)              
By Purchaser, Parent or Seller if any Governmental Entity shall have issued
an order, decree or ruling or taken any other action (which order, decree,
ruling or other action the parties hereto shall use their reasonable efforts to
lift), which permanently restrains, enjoins or otherwise prohibits the
acquisition by Purchaser of the Assets and such order, decree, ruling or other
action shall have become final and non-appealable, unless the party relying on
such order, decree, ruling or other action has not complied in all material
respects with its obligations under this Agreement.

            (c)               
By Parent or Seller:

                        (i)                 
if Purchaser shall have breached in any material respect any of its
representations, warranties, covenants or other agreements contained in this
Agreement, which breach cannot be or has not been cured within ten (10) days
after the giving of written notice by Seller or Parent to Purchaser specifying
such breach; or

                        (ii)               
on or after December 29, 2006, if the Closing shall not have theretofore
occurred and if the failure of the Closing to occur is not the result of a
breach of a representation, warranty or covenant by Parent or Seller.

            (d)              
By Purchaser:

                        (i)                 
if Parent or Seller shall have breached in any material respect any
representation, warranty, covenant or other agreement contained in this
Agreement which would give rise to the failure of a condition set forth in
Section 6.2; or

                        (ii)               
on or after December 29, 2006, if the Closing shall not have theretofore
occurred and if the failure of the Closing to occur is not the result of a
breach of a representation, warranty or covenant by Purchaser.

42

Section 7.2             
Effect of Termination.  In the event of the termination or
abandonment of this Agreement and the Transactions by any party hereto pursuant
to the terms of this Agreement, written notice thereof shall forthwith be given
to the other party or parties specifying the provision hereof pursuant to which
such termination or abandonment of the Transactions is made, and there shall be
no liability or obligation thereafter on the part of Purchaser, Parent or
Seller except for fraud or any breach of this Agreement prior to such
termination; provided, however, that the provisions of
Section 5.2(c), 5.10 and 10 shall remain in full force and effect and
survive any termination of this Agreement.

ARTICLE VIII

INDEMNIFICATION

Section 8.1             
Indemnification; Remedies.

            (a)               
Parent and Seller shall indemnify, defend and hold harmless the
Purchaser Indemnified Persons from and against and in respect of all Purchaser
Losses.

            (b)              
Parent and Seller shall indemnify, defend and hold harmless the
Purchaser Indemnified Persons from and against and in respect of any and all Taxes
imposed upon the Purchaser of the Assets with respect or pursuant to
(w) any Pre-Closing Period, (x) any Straddle Period, but only with
respect to the Pre-Closing Straddle Period and in the manner provided in
Section 8.1(c) hereof, (y) Treasury Regulations section 1.1502-6 (or any
comparable provision under state, local or foreign law or regulation imposing
several liability upon members of a consolidated, combined, affiliated or
unitary group) for any Pre-Closing Period or Pre-Closing Straddle Period and
(z) a breach or inaccuracy in any representation contained in Section 3.25
of this Agreement or any covenant of Parent or Seller set forth in this
Article VIII; provided, however, that such indemnification
shall not apply or extend to any Taxes which are properly reflected as a
liability in the Financial Information.  For purposes of calculating the Taxes
imposed which relate to a Straddle Period and must be allocated between a
Pre-Closing Straddle Period and a Post-Closing Straddle Period, the Taxes attributable
to the Pre-Closing Straddle Period shall be computed as if such taxable period
ended on and included the Closing Date and the Taxes attributable to the
Post-Closing Straddle Period shall be computed as if such taxable period began
on the day immediately following the Closing Date.

            (c)               
Notwithstanding the indemnification obligations of Parent and Seller
provided for under Sections 8.1(a) and 8.1(b) above, no claim for Purchaser
Losses shall be made under Section 8 unless the aggregate of Losses exceeds
$390,000 for which claims are made hereunder by the Purchaser Indemnified
Persons in which case the Purchaser Indemnified Persons shall be entitled to
seek compensation for all Losses without regard to such $390,000 limitation set
forth in this Section 8.1(c); provided, however, that any claim
for Losses arising out of or resulting from Section 8.1(b) above shall not be
subject to such limitation and Purchaser shall immediately be entitled to be
indemnified, and receive payment, for all Losses related thereto; provided,
further, that the limitations set forth in this Section 8.1(c)
shall not apply to Purchaser Losses (x) arising out of any breach by
Parent or Seller of any representation or warranty contained in
Section 3.1 through and including Section 3.5, or in
Section 3.15, or (y) arising out of any material breach of any
covenant to be performed by Parent or Seller pursuant hereto.

            (d)              
Notwithstanding anything to the contrary in this Agreement, in no event
will the aggregate liability of Parent and Seller for indemnification pursuant
to Sections 8.1(a) and 8.1(b) above exceed the amount of the Indemnification
Holdback.

43

            (e)               
Purchaser shall indemnify and hold Parent and Seller harmless from and
against, all liability, demands, claims, actions or causes of action, assessments,
losses, damages, costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses) imposed on, sustained, incurred or suffered by
Parent and Seller, directly or indirectly, by reason of or resulting from any
and all Taxes with respect to the Assets imposed upon any Parent or Seller with
respect or pursuant to (i) any taxable period beginning after the Closing
Date and (ii) any Straddle Period, but only with respect to the portion of
such Straddle Period which is a Post-Closing Straddle Period and in the manner
provided in Section 8.1(b)(i) hereof.

            (f)                
In the event that a Transaction Event occurs following the date of this
Agreement but prior to the Closing Date, for purposes of determining
indemnifiable Purchaser Losses, such Transaction Event shall be treated as if
it occurred following the Closing Date, such that, for purposes of the
representations and warranties of Parent and Seller in Article III, notwithstanding
anything to the contrary in this Agreement, no indemnifiable Purchaser Losses
shall result solely from the existence of such Transaction Event as of the
Closing Date, provided, however, the foregoing shall not limit
any indemnifiable Purchaser Losses resulting from breaches of representations
and warranties that otherwise occur as a result of such Transaction Event when it is treated as if it occurred following the Closing Date pursuant
to this Section 8.1(f).

Section 8.2             
Indemnification Holdback.

           
(a)        At Closing, $5,850,000 of the Purchase Price will be held
back by the Purchaser as security of the indemnification obligations of Parent
and Seller under Section 8.1 hereof (the "Indemnification Holdback");
provided, however, that, subject to the other limitations set forth herein,
Purchaser shall be entitled to seek indemnification hereunder following the
release of the Indemnification Holdback.  Any portion of the Indemnification
Holdback not previously released to Purchaser as a result of an indemnification
claim by Purchaser shall be released to Seller at the end of the Holdback
Period; provided, however, that a portion of the Indemnification Holdback,
which, in the reasonable judgment of Purchaser, is necessary to satisfy any
unsatisfied claims specified in any Officer's Certificate theretofore delivered
to Parent and/or Seller prior to termination of the Holdback Period with
respect to facts and circumstances existing prior to expiration of the Holdback
Period, shall be retained by Purchaser until such claims have been resolved.

            (b)              
On the Release Date, Purchaser shall pay to Seller any portion of the
Indemnification Holdback not previously paid to Purchaser for indemnification
hereunder, less the dollar amount equal to any portion of the Indemnification
Holdback subject to retention by Purchaser in accordance with Section 8.2(a) with
respect to any pending but unresolved indemnification claims of Purchaser.  Any
portion of the Indemnification Holdback held as a result of this Section 8.2(b)
shall be paid to Seller or retained by Purchaser (as appropriate) promptly upon
resolution of each specific claim involved.

Section 8.3             
Claims Upon Indemnification Holdback.  Upon delivery to Parent
and/or Seller on or before the Release Date of an Officer's Certificate,
Purchaser shall, subject to the provisions of this Article VIII, retain cash
held in the Indemnification Holdback having a value equal to such damages.

44

Section 8.4             
Objections to Claims.

            (a)               
For a period of twenty (20) calendar days from and after delivery of any
Officer's Certificate to the Parent and Seller, Purchaser shall take no action
regarding the Indemnification Holdback hereof unless Purchaser shall have
received written authorization from Parent or Seller to retain such portion of
the Indemnification Holdback.  After the expiration of such twenty (20) day
period, Purchaser shall retain the portion of the Indemnification Holdback or
other property in the Indemnification Holdback in accordance with Section 8.3
hereof and Seller shall no longer be entitled to receive such amount hereunder,
provided that no such retention may be made if Parent and Seller shall object
in a written statement to the claim made in the Officer's Certificate, and such
statement shall have been delivered to Purchaser prior to the expiration of
such twenty (20) day period.

            (b)              
In case the Parent and Seller shall so object in writing to any claim or
claims by Purchaser made in any Officer's Certificate, Purchaser shall have
twenty (20) calendar days to respond in a written statement to the objection of
Parent and Seller.  If after such twenty (20) day period there remains a
dispute as to any claims, Parent, Seller and Purchaser shall attempt in good
faith for thirty (30) calendar days to agree upon the rights of the respective
parties with respect to each of such claims.  If Parent and Seller and
Purchaser should so agree, a memorandum setting forth such agreement shall be
prepared by Purchaser and signed by Purchaser, Parent and Seller.  Purchaser
shall be entitled to rely on any such memorandum and shall retain the cash from
the Indemnification Holdback in accordance with the terms thereof.

Section 8.5             
Resolution of Conflicts.  If no agreement can be reached after
good faith negotiation between the parties pursuant to Section 8.4, any of
Purchaser, Parent or Seller may initiate formal legal action with the
applicable court in San Diego, California or San Diego County, California to resolve such dispute.  The decision of the court as to the validity and
amount of any claim in such Officer's Certificate shall be binding and
conclusive upon the parties to this Agreement, and notwithstanding anything in
Section 8 hereof, the parties shall be entitled to act in accordance with such
decision and the Purchaser shall be entitled to make or withhold payments out
of the Indemnification Holdback in accordance therewith.

45

Section 8.6             
Third-Party Claims.  In the event Purchaser becomes aware of a
third-party claim which Purchaser believes may result in a demand against the
Indemnification Holdback, Purchaser may initially assume the defense of such
third-party claim.  Such defense shall be conducted by counsel chosen by Purchaser
reasonably acceptable to Parent and Seller and at Purchaser's expense, provided
that other than in connection with third party claims that relate in any way to
the enforceability or validity of any of the Patents included in the Assets, if
the claimed total amount of damages or potential amount of damages (as
reasonably determined by Purchaser in its sole discretion) is less than the
Holdback Amount, Parent and Seller shall be entitled, at their expense, to assume
the defense of such claim with counsel chosen by Parent and at Parent's sole
expense, provided that Purchaser shall be entitled, at its expense, to monitor
or participate in the defense.  If Purchaser has assumed the defense of such
third‐party claim, Purchaser shall not be entitled to settle any such
claim without Parent's and Seller's prior written consent, which shall not be
unreasonably withheld, unless Purchaser has assumed the defense of such
third-party claim and as part of such settlement Parent and Seller are
unconditionally released from all liability with respect to such third party
claim.  If Parent or Seller has assumed the defense of such claim, neither Parent
nor Seller shall be entitled to settle any claim without Purchaser's prior
written consent, which shall not be unreasonably withheld, unless Purchaser is
unconditionally released from all liability with respect to such third party
claim.  In the event that Parent or Seller has consented to any such
settlement, Parent and Seller shall have no power or authority to object under
Article VIII or any other provision of this Section 8.6 to the amount of any
claim by Purchaser for indemnity with respect to such settlement.

Section 8.7             
Survival of Indemnification Claims.  The indemnification
obligations set forth in this Article VIII shall survive the Closing.

Section 8.8             
Tax Effect of Indemnification Payments.  All indemnity payments
made by Parent or Seller to Purchaser Indemnified Persons, or by Purchaser
Indemnified Persons to Parent or Seller, pursuant to this Agreement shall be
treated for all Tax purposes as adjustments to the Purchase Price.

Section 8.9             
Effect of Investigation.  The right to indemnification, payment
of Purchaser Losses or for other remedies based on any representation,
warranty, covenant or obligation of Parent or Seller contained in or made
pursuant to this Agreement shall not be affected by any investigation conducted
with respect to, or any knowledge acquired (or capable of being acquired) at
anytime, whether before or after the execution and delivery of this Agreement
or the date the Closing occurs, with respect to the accuracy or inaccuracy of
or compliance with, any such representation, warranty, covenant or obligation. 
The waiver of any condition to the obligation of Purchaser to consummate the
Transactions, where such condition is based on the accuracy of any
representation or warranty, or on the performance of or compliance with any
covenant or obligation, shall not affect the right to indemnification, payment
of Purchaser Losses, or other remedy based on such representation, warranty,
covenant or obligation.

Section 8.10         
Survival of Covenants, Representations and Warranties.  Each of
the covenants, representations and warranties of Parent and the Seller in this
Agreement or in any schedule, instrument or other document delivered pursuant
to this Agreement shall survive the Closing Date and shall continue in force
thereafter until the expiration of twenty-seven (27) months following the
Closing Date; provided, however, that (a) the
representations, warranties, covenants, agreements and Closing certifications
made by Parent and the Seller in (i) Section 3.1
with respect to due authority, (iii) Section 3.20 with respect to
Environmental Laws and (v) Section 3.27 with respect to Taxes shall
survive the execution and delivery of this Agreement and the Closing until the
date which is ninety (90) days after the date on which the respective
applicable statute of limitations has expired or indefinitely if no statute of
limitation applies; (b) claims related to fraud or willful misconduct
shall survive indefinitely; and (c) claims under Section 8.1(b) or related
to subsections (ii) or (iv) of the definition of Purchaser Losses shall survive indefinitely.  There shall be no
termination of any such representation or warranty as to which an Officer's
Certificate has been delivered prior to the termination of such survival
period.

46

ARTICLE IX

DEFINITIONS AND INTERPRETATION

Section 9.1             
Definitions.  For all purposes of this Agreement, except as
otherwise expressly provided or unless the context clearly requires otherwise:

"Acquisition
Proposal" shall mean any proposal or offer made by any Person other than
Purchaser or any Subsidiary of Purchaser to acquire the Assets, or any portion
thereof, or all or a substantial part of the business properties of the Seller
or any capital stock of Seller, whether by merger, tender offer, exchange
offer, sale of assets or similar transactions involving the Seller, or
operating or principal business unit of the Seller, and shall not include a
proposal or offer to acquire all or substantially all the assets or stock of
Parent on terms which do not interfere with the consummation of the
Transactions.

"Additional
Proprietary Rights" shall have the meaning set forth in Section 3.29(b).

"Affiliate"
shall have the meaning set forth in Rule 12b-2 promulgated under the Exchange
Act.

"Agreement"
or "this Agreement" shall mean this Asset Purchase Agreement, together
with the Exhibits, Schedules and Appendices hereto and the Disclosure Schedule.

"Ancillary
Agreements" shall mean each of the following agreements or other documents
delivered into connection with the consummation of the Transactions: the
Assumption Agreement, the Bill of Sale, the Joint Defense Agreement, the
Agreement Regarding Certain Indemnity Claims, the Patent Assignments and the
Trademark Assignments.

"Assets"
shall mean all of the property, assets, Proprietary Rights, goodwill and
business as a going concern of every kind, nature and description, real,
personal or mixed, tangible or intangible, wherever situated, which is owned or
leased by Seller, including, but not limited to, all assets relating to the
Bluetooth 2.0 Enhanced Data Rate (EDR) products with HCI Interface (including,
but not limited to, the RF1722A/B, RF4020, RF4050, RF4100, RF4113 and RF4120
products), all associated Bluetooth-related Proprietary Rights, and all
inventory and receivables related to such products, as well the property,
assets and rights of Parent related to the foregoing products and business of
the Seller (including Seller Proprietary Rights), in each case including, but
not limited to, the property, assets and rights of Parent and Seller set forth
on Schedule 9.1(A) attached hereto.  The term Assets shall not include any
property, asset or right which is an Excluded Asset.

"Associate"
shall have the meaning set forth in Rule 12b-2 promulgated under the Exchange
Act.

"Assumed
Contracts" shall mean the contracts set forth on Schedule 9.1(B).

"Assumed
Liabilities" shall mean only those liabilities set forth in the Assumption
Agreement.

47

"Assumption
Agreement" shall mean the Instrument of Assumption of Liabilities in the
form attached hereto as Exhibit G.

"Bill of
Sale" shall mean the Indenture, Bill of Sale and Assignment attached hereto
as Exhibit H.

"Bluetooth
Know-How" shall mean all Bluetooth-related technology, software, firmware,
schematics, know-how, documentation and the like, including, but not limited
to, as set forth in Exhibit C.

"Closing"
shall mean the closing referred to in Section 2.1.

"Closing
Date" shall mean the date on which the Closing occurs.

"Code"
shall mean the Internal Revenue Code of 1986, as amended.

"Computer
Software" shall mean computer software programs, databases and all
documentation related thereto.

"Confidentiality
Agreement" shall mean that certain Mutual Non‐Disclosure Agreement
dated as of June 6, 2005 by and between the Parent and the Purchaser.

"Copyrights"
shall mean all copyrights, copyrightable works (including without limitation
all software, middleware and firmware), semiconductor topography, mask works
and mask work rights, and applications for registration of any of the
foregoing, including without limitation all rights of authorship, use,
publication, reproduction, distribution, performance, transformation, moral
rights and rights of ownership of copyrightable works, semiconductor topography
works and mask works, and all rights to register and obtain renewals and
extensions of registrations, together with all other interests accruing by
reason of international copyright, semiconductor topography and mask work
conventions and treaties.

"Defect"
shall mean a defect or impurity of any kind, whether in design, manufacture,
processing, or otherwise, including any dangerous propensity associated with
any reasonably foreseeable use of a Seller Product, or the failure to warn of
the existence of any defect, impurity, or dangerous propensity.

"Defenses
and Claims" shall mean defenses, set-offs or counterclaims which Parent or
Seller may have had or which Purchaser or any Affiliate or Subsidiary of
Purchaser shall have (to the extent relating to the Assumed Liabilities) to any
of the Assumed Liabilities.

"Disclosure
Schedule" shall mean the disclosure schedule of even date herewith prepared
by the Parent and the Seller and delivered to Purchaser simultaneously with the
execution hereof.

"DOJ"
shall mean the Antitrust Division of the United States Department of Justice.

48

"Encumbrances"
shall mean any and all liens, charges, security interests, options, claims,
mortgages, pledges, proxies, voting trusts or agreements, obligations,
understandings or arrangements or other restrictions on title or transfer of
any nature whatsoever.

"Environmental
Claim" shall mean any claim, action, cause of action, investigation or
notice (written or oral) by any Person alleging actual or potential liability
for investigatory, cleanup or governmental response costs, or natural resources
or property damages, or personal injuries, attorney's fees or penalties
relating to (i) the release into the environment of any Materials of
Environmental Concern, or (ii) circumstances forming the basis of any
violation, or alleged violation, of any Environmental Law relating to the
Assets.

"Environmental
Law" shall mean each federal, state and local law and regulation relating
to pollution and protection of human health or the environment including
ambient air, surface water, ground water, land surface or subsurface strata,
and natural resources, and including each law and regulation relating to
emissions, discharges, releases or threatened releases of Materials of
Environmental Concern, or otherwise relating to the manufacturing, processing,
distribution, use, treatment, generation, storage, containment (whether above
ground or underground), disposal, transport or handling of Materials of
Environmental Concern, and each law and regulation with regard to record
keeping, notification, disclosure and reporting requirements respecting
Materials of Environmental Concern.

"ERISA"
shall mean the Employee Retirement Income Security Act of 1974, as amended.

"ERISA
Affiliate" shall mean any trade or business, whether or not incorporated,
that together with the Parent or Seller would be deemed a "single employer"
within the meaning of Section 4001(b) of ERISA.

"Exchange
Act" shall mean the Securities Exchange Act of 1934, as amended.

"Excluded
Assets" shall mean (i) cash and cash equivalents held by the Seller, (ii)
the assets, property or other rights of Seller or Parent that are related
solely to the Excluded Business (including all Seller Proprietary Rights (other
than Seller's Trade Secrets and the Bluetooth Know-How, all of which are
included in the Assets), inventory, receivables, and customer contracts, in
each case solely to the extent related exclusively to the Excluded Business),
(iii) the cash deposit related to the lease of the Seller Facility, (iv) the
furniture, fixtures and office supplies located at the Seller Facility, (v) any
Proprietary Rights of the Parent or any Subsidiary (other than Seller) that do
not constitute Seller Proprietary Rights, (vi) any other property or asset of
Parent or any Subsidiary (other than Seller) that is not used as of the date of
this Agreement primarily for the benefit of the Seller in connection with the
Assets of Seller being sold to Purchaser hereunder, or (vii) any other asset,
property or other right of Parent or Seller that is set forth on Part 3.21(a)
of the Disclosure Schedule (other than Seller's Trade Secrets and the Bluetooth
Know-How, all of which are included in the Assets) or set forth on Schedule
9.1(E).

"Excluded
Business" shall mean the business of Seller specifically and exclusively
relating to the Bluetooth specification V1.2 qualified products listed on
Schedule 9.1(F) attached hereto.

49

"Excluded
Employees" shall mean the employees listed on Schedule 5.6.

"Financial
Information" shall mean the financial information of Seller's business set
forth in Schedule 9.1(C), including, but not limited to, schedules showing
revenues by transferred product, fixed asset list, inventories and receivables
included in the Assets, in each case as of and for the six-month period ended
September 30, 2006.

"FTC"
shall mean the United States Federal Trade Commission.

"GAAP"
shall mean United States generally accepted accounting principles.

"Governmental
Entity" shall mean a court, arbitral tribunal, administrative agency or
commission or other governmental or other regulatory authority or agency.

"Holdback
Period" shall mean the eighteen (18) month period from and after the
Closing Date.

"HSR Act"
shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

"Indebtedness"
shall mean (i) all indebtedness for borrowed money or for the deferred
purchase price of property or services (other than current trade liabilities
incurred in the ordinary course of business and payable in accordance with
customary practices), (ii) any other indebtedness that is evidenced by a
note, bond, debenture or similar instrument, (iii) all obligations under
financing leases, (iv) all obligations in respect of acceptances issued or
created, (v) all liabilities secured by any lien on any property and
(vi) all guarantee obligations.

"Indemnification
Holdback" shall have the meaning set forth in Section 8.2(a).

"IP
Encumbrance" shall mean any lien, pledge, hypothecation, charge, mortgage,
security interest, encumbrance, claim, infringement, interference, option,
right of first refusal, right of first negotiation, license, covenant not to
assert/sue or other immunity from suit, equitable interest, preemptive right,
community property interest, technology escrow, title retention or title
reversion agreement, prior assignment, or any other encumbrance or restriction
of any nature, whether accrued, absolute, contingent or otherwise (including
without limitation any restriction on the transfer or licensing of any asset,
any restriction on the receipt of any income derived from any asset, any
restriction on the use of any asset and any restriction on the possession,
exercise or transfer of any other attribute of ownership of any asset).

"Issued
Patents" shall mean all issued patents, reissued or reexamined patents,
revivals of patents, utility models, certificates of invention, registrations
of patents and extensions thereof, regardless of country or formal name, issued
by the United States Patent and Trademark Office and any other applicable
Governmental Body, including without limitation design patents.

50

"Knowledge
of Parent and Seller" concerning a particular subject, area or aspect of
the Assets or business or affairs of Parent and Seller shall mean the actual
knowledge (and any knowledge that they would reasonably expect to acquire
following review of relevant reasonably available business files and inquiry of
any personnel of Seller having primary responsibility for such matters) of each
of the following officers and employees of Parent and Seller:  Barry Church,
Suzanne Rudy, Jerry Neal, Dave Lyon, Dave Favreau, Ralph Knupp, Robert
Bruggeworth, William Priddy Jr., Philip Smith and, solely with respect to
Section 3.29 hereof, William Pratt, Greg Hein, Mike Yin and Joel Linsky.

"Lease"
shall mean each lease pursuant to which Parent (solely for the use or benefit
of the Seller or any of the Assets) or Seller (solely with respect to any of
the Assets) leases any real or personal property (excluding leases relating
solely to personal property calling for rental or similar periodic payments not
exceeding $10,000 per annum).

"Material
Adverse Effect" shall mean shall mean the occurrence or reasonably likely
occurrence of any event, change, circumstance or effect that individually or in
the aggregate (taking into account all other such events, changes,
circumstances or effects), is, or is reasonably likely to (A) be materially
adverse to the financial condition, properties, assets (including intangible
assets), liabilities, business, operations, results of operations or prospects
of any Person, entity or group, or (B) materially hinder or delay the ability
of any Person, entity or group to consummate the transactions contemplated
herein or the Purchaser's ability to use the Assets (in a substantially similar
manner to the use by Seller) following the Closing.

"Materials
of Environmental Concern" shall mean chemicals; pollutants; contaminants;
wastes; toxic or hazardous substances, materials and wastes; petroleum and
petroleum products; asbestos and asbestos-containing materials; polychlorinated
biphenyls; lead and lead-based paints and materials; and radon that are subject
to Environmental Laws.

"Off-the-Shelf
Software" shall mean any software (other than Public Software) that is
generally and widely available to the public through regular commercial
distribution channels and is licensed on a non-exclusive basis on standard
terms and conditions for a one-time license fee less than $10,000 per license
and that was obtained by Parent or Seller in the ordinary course of business.

"Officer's
Certificate" shall mean a certificate signed by any officer of Purchaser
stating that with respect to the indemnification obligations of the Parent and
Seller set forth in Section 8.1, Purchaser Losses exist and specifying in
reasonable detail the individual items of such damages included in the amount
so stated, the date each such item was paid, or properly accrued or arose, and
the nature of the misrepresentation, breach of warranty, covenant or claim to
which such item is related.

"Parent"
shall mean RF Micro Devices, Inc., a North Carolina corporation.

"Patents"
shall mean the Issued Patents and the Patent Applications.

"Patent
Applications" shall mean all published and all unpublished non-provisional
and provisional patent applications, reexamination proceedings, invention
disclosures, records of invention, applications for certificates of invention
and priority rights, in any country and regardless of formal name, including
without limitation, substitutions, continuations, continuations-in-part,
divisions, renewals, revivals, reissues, re-examinations and extensions
thereof.

51

"PBGC"
shall mean the Pension Benefit Guaranty Corporation.

"Permitted
Encumbrances" means (a) the lien of current Taxes not yet due,
(b) such imperfections of title, liens and easements as do not and will
not detract from or interfere with the use of the Assets subject thereto or
affected thereby, or otherwise impair business operations involving such
Assets, (c) the Retained Know-How Rights, and (d) the license rights of Parent
under that certain Patent License Agreement dated as of November 30, 2006
between Seller and Parent.

"Person"
shall mean a natural person, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Entity or other entity or
organization.

"Phase II
Testing" shall have the meaning set forth in Section 5.2(b).

"Plan"
means each of the following maintained or contributed to or required to be
contributed to by Seller or its ERISA Affiliates to the extent it benefits
current or former employees or directors of, or consultants or other service
providers of Seller:  (A) a "plan" described in Section 3(3) of ERISA;
(B) an arrangement that would constitute a "plan" described in
Section 3(3) of ERISA but for the fact that it benefits persons other than
employees; (C) a stock bonus, stock option, stock purchase, restricted stock,
stock appreciation right, or other equity-based plan; or (D) an incentive,
bonus, employment, deferred compensation, vacation, earned time off, sick time,
retiree benefit, supplemental retirement, termination, salary continuation,
severance, change in control, fringe benefit or other benefit plan not
otherwise described in (A), (B) or (C).

"Post-Closing
Straddle Period" shall mean the portion of a Straddle Period beginning the
day after the Closing Date.

"Pre-Closing
Period" shall mean a taxable period ending on or prior to the Closing Date.

"Pre-Closing
Straddle Period" shall mean the portion of a Straddle Period ending on the
Closing Date.

"Proprietary
Rights" shall mean any and all of the foregoing in any country: (a)(i)
Issued Patents, (ii) Patent Applications, (iii) Trademarks, (iv) domain names
and domain name registrations, (v) Copyrights, (vi) Trade Secrets, (vii)
Bluetooth Know-How, and (viii) all other ideas, inventions, designs,
manufacturing, operating and other specifications, technical data and
information, and other intangible assets, intellectual properties and rights
(whether or not appropriate steps have been taken to protect, under applicable
law, such other intangible assets, properties or rights); or (b) any right
(whether at law, equity by contract or otherwise) to use, practice or otherwise
exploit any of the foregoing.  The term Proprietary Rights includes the right
to sue for or assert claims against and remedies against past, present or
future infringements of any or all of the foregoing and rights of priority and
protection of interests therein.

52

"Public
Software" shall mean any software that contains, or is derived in any
manner (in whole or in part) from, any software that is distributed as free
software, open source software (e.g., Linux) or similar licensing or
distribution models, including without limitation any model that requires the
distribution of source code to licensees, including software licensed or
distributed under any of the following licenses or distribution models, or
licenses or distribution models similar to any of the following:  (i) GNU's
General Public License (GPL) or Lesser/Library GPL (LGPL); (ii) the Artistic
License (e.g., PERL); (iii) the Mozilla Public License; (iv) the Netscape
Public License; (v) the Sun Community Source License (SCSL); (vi) the Sun
Industry Standards License (SISL); (vii) the BSD License; and (viii) the Apache
License.

"Purchase
Price" shall mean $39,000,000.

"Purchaser"
shall mean QUALCOMM Incorporated, a Delaware corporation.

"Purchaser
Indemnified Persons" shall mean Purchaser and its Affiliates, directors,
officers, employees, attorneys, independent contractors and other agents.

"Purchaser
Losses" shall mean any and all actual losses, liabilities, damages,
judgments, settlements and expenses (including interest and penalties recovered
by a third party with respect thereto and reasonable attorneys' fees and
expenses and reasonable accountants' fees and expenses incurred in the
investigation or defense of any of the same) incurred by any of the Purchaser
Indemnified Persons that arise out of:

                        (i)                 
any breach by Parent or Seller of any of its representations and
warranties contained in or made by or pursuant to this Agreement as if such
representations and warranties were made on and as of the Closing Date (except as
set forth in Section 8.1(f) and except for such representations and warranties
that speak specifically as of another date, which shall speak as of such other
date); 

                        (ii)               
any of the events, circumstances or conditions described in
Section 3.19 hereof, any pollution or threat to human health or the
environment that (A) is related in any way to the Parent's or Seller's (or
any other owner's or operator's) management, use, control, ownership or
operation of the Assets or the properties or businesses of the Seller prior to
the Closing, including all on-site and off-site activities involving Materials
of Environmental Concern, and (B) occurred, existed, arises out of
conditions or circumstances that occurred or existed, or was caused, in whole
or in part, on or before the Closing Date, whether or not the pollution or
threat to human health or the environment is described in the Disclosure
Schedule; or any Environmental Claim against the Parent (solely with respect to
the Seller or any of the Assets) or Seller or any Person whose liability for
such Environmental Claim the Parent (solely with respect to the Seller or any
of the Assets) or Seller has assumed or retained either contractually or by
operation of law;

                        (iii)              
any breach by Parent or Seller of any of its covenants in this
Agreement; or

                        (iv)             
any liabilities of Parent or the Seller other than the Assumed
Liabilities (including, but not limited to, as described in Section 1.4).

provided, however,
that the term "Purchaser Losses" shall not include the matters referred to in
Section 8.1(b) hereof.  

53

"Real
Property" shall mean all real property that is owned, leased or used by
Parent or Seller for the use or benefit of the Seller or that is an asset of
the Seller.

"Registered
Copyrights" shall mean all Copyrights for which registrations have been
obtained or applications for registration have been filed in the United States
Copyright Office and any other applicable Governmental Body.

"Registered
Trademarks" shall mean all Trademarks for which registrations have been
obtained or applications for registration have been filed in the United States
Patent and Trademark Office and any applicable Governmental Body.

"Release
Date" shall mean a date no later than three (3) business days after
the termination of the Holdback Period.

"Required
Contract Consents" shall mean all consents to the assignment of the contracts
set forth on Schedule 9.1(D) attached hereto.

"Retained Know-How
Rights" shall mean the rights of Parent and Seller to utilize Bluetooth
Know-How as set forth in, and in accordance with, Exhibit C attached
hereto.

"Securities
Act" shall mean the Securities Act of 1933, as amended.

"SEC"
shall mean the United States Securities and Exchange Commission.

"Seller"
shall mean RFMD WPAN, Inc., a Delaware corporation.

"Seller
Facility" shall mean Seller's facilities located in San Diego, California, including, but not limited, to the premises leased by Seller located at 62256 Greenwich Drive, San Diego, California.

"Seller
Product(s)" shall mean each and all of the products of the Seller
(including without limitation all components, parts, integrated circuits or
elements thereof, chemicals, compositions, tools, kits (including without
limitation tool kits, drug kits and screening kits), drugs, animals, plants,
software, firmware, middleware, databases, interfaces, systems, devices, hardware,
equipment, other tangible items designed, developed, manufactured, assembled,
sold, leased, installed, repaired, licensed or otherwise made available by the
Parent or Seller or any services performed by the Parent or Seller), whether
currently being distributed, currently under development, or otherwise
anticipated to be distributed under any product "road map" of the Seller or
otherwise incorporating any Seller Proprietary Rights.

"Seller
Proprietary Rights" shall mean any Proprietary Rights owned by or licensed
to the Parent (for the benefit of the Seller) or Seller or otherwise used in
the business of the Seller.

"Seller
Source Code" shall mean the source code of any software or program (i.e.,
software code in its original, human readable, un-compiled, form), or any
portion, aspect or segment of any source code, owned by or licensed to any of
the Parent (for the benefit of Seller) or Seller or otherwise used by the
Seller in the conduct of its business (other than such source code (or portion,
aspect or segment thereof) used exclusively in the Excluded Business).

54

"Straddle
Period" shall mean any taxable period beginning before the Closing Date and
ending after the Closing Date.

"Subsidiary"
shall mean, with respect to any Person, any corporation or other organization,
whether incorporated or unincorporated, of which (a) at least a majority
of the securities or other interests having by their terms ordinary voting
power to elect a majority of the Board of Directors or others performing
similar functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such Person or by any one or more
of its Subsidiaries, or by such Person and one or more of its Subsidiaries or
(b) such Person or any other Subsidiary of such Person is a general
partner (excluding any such partnership where such Person or any Subsidiary of
such party does not have a majority of the voting interest in such
partnership).

"Tangible
Personal Property" means all machinery, equipment, tools, furniture,
fixtures and equipment, computer hardware, supplies, materials, leasehold
improvements, automobiles, computing and telecommunications equipment and other
items of tangible personal property of every kind owned or leased by Parent or
Seller and included in the Assets.

"Tax"
or "Taxes" shall mean all taxes, charges, fees, duties, levies,
penalties or other assessments imposed by any federal, state, local or foreign
governmental authority, including income, gross receipts, excise, property,
sales, gain, use, license, custom duty, unemployment, capital stock, transfer,
franchise, payroll, withholding, social security, minimum estimated, profit,
gift, severance, value added, disability, premium, recapture, credit,
occupation, service, leasing, employment, stamp and other taxes, and shall
include interest, penalties or additions attributable thereto or attributable
to any failure to comply with any requirement regarding Tax Returns.

"Tax
Contest" shall mean any deficiency, proposed adjustment, adjustment,
assessment audit, examination or other administrative or court proceeding,
suit, dispute or other claim.

"Tax Claim"
shall mean a claim for indemnification or defense arising out of
Section 8.1(b)(i), including reasonable attorneys' fees and expenses and
reasonable accountants' fees and expenses incurred in the investigation or
defense of any of the same or in asserting, preserving or enforcing any of the
rights of Purchaser arising under Section 8.1(b)(i).

"Tax Return"
shall mean any return, declaration, report, claim for refund, or information
return or statement relating to Taxes, including any such document prepared on
a consolidated, combined or unitary basis and also including any schedule or
attachment thereto, and including any amendment thereof.

55

"Trade
Secrets" shall mean all product specifications, data, know-how, formulae,
compositions, processes, designs, sketches, photographs, graphs, drawings,
samples, inventions and ideas, research and development, manufacturing or
distribution methods, processes and specifications, customer lists, current and
anticipated customer requirements, price lists, market studies, business plans,
computer software and programs (including both source code and object code),
databases, interfaces, computer software and database technologies, systems,
structures and architectures (and related processes, formulae, composition,
improvements, devices, know-how, inventions, discoveries, concepts, ideas,
designs, methods and information), and any other information, however documented,
that is a trade secret within the meaning of the applicable trade-secret
protection law.

"Trademarks"
shall mean all (i) trademarks, service marks, marks, logos, insignias, designs,
other symbols, trade names and fictitious business names, (ii) applications for
registration of trademarks, service marks, marks, logos, insignias, designs,
other symbols, trade names and fictitious business names, (iii) trademarks,
service marks, marks, logos, insignias, designs, other symbols, trade names and
fictitious business names for which registrations have been obtained and (iv)
all goodwill associated with each of the foregoing.

"Transaction
Event" shall mean an event, change, circumstance or effect arising directly
from, directly attributable to or as a direct result of the execution of this
Agreement or the public announcement of this Agreement and the Transactions.

"Transactions"
shall mean all the transactions provided for or contemplated by this Agreement
and the Ancillary Agreements.

"Transfer
Taxes" shall mean all sales (including, without limitation, bulk sales),
use, transfer, recording, ad valorem, privilege, documentary, gains, gross
receipts, registration, conveyance, excise, license, stamp, duties or similar
Taxes and fees.

"Voting
Debt" shall mean indebtedness having general voting rights and debt
convertible into securities having such rights.

"WARN Act"
shall mean the Worker Adjustment and Retraining Notification Act (29 U.S.C.
Section 2101).

"Withholding
Taxes" shall mean any Taxes required to be withheld and paid by Purchaser
for the account of the Parent or the Seller with respect to the Purchase Price.

Section 9.2             
Interpretation.

            (a)               
When a reference is made in this Agreement to a section or article, such
reference shall be to a section or article of this Agreement unless otherwise
clearly indicated to the contrary.

            (b)              
Whenever the words "include", "includes" or "including" are used in this
Agreement they shall be deemed to be followed by the words "without
limitation."

            (c)               
The words "hereof", "herein" and "herewith" and words of similar import
shall, unless otherwise stated, be construed to refer to this Agreement as a
whole and not to any particular provision of this Agreement, and article,
section, paragraph, exhibit and schedule references are to the articles, sections,
paragraphs, exhibits and schedules of this Agreement unless otherwise
specified.

56

            (d)              
The meaning assigned to each term defined herein shall be equally
applicable to both the singular and the plural forms of such term, and words
denoting any gender shall include all genders.  Where a word or phrase is
defined herein, each of its other grammatical forms shall have a corresponding
meaning.

            (e)               
A reference to any party to this Agreement or any other agreement or
document shall include such party's successors and permitted assigns.

            (f)                
A reference to any legislation or to any provision of any legislation
shall include any amendment to, and any modification or re-enactment thereof,
any legislative provision substituted therefor and all regulations and
statutory instruments issued thereunder or pursuant thereto.

            (g)               
The parties have participated jointly in the negotiation and drafting of
this Agreement.  In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties, and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provisions of this
Agreement.

ARTICLE X

MISCELLANEOUS

Section 10.1         
Fees and Expenses.  All costs and expenses incurred in connection
with this Agreement and the consummation of the Transactions shall be paid by
the party incurring such expenses, except as specifically provided to the
contrary in this Agreement and except that all Transfer Taxes arising out of,
in connection with or attributable to the transactions effected pursuant to
this Agreement shall be borne and paid by Parent or Seller.  The Parent shall
prepare and timely file all relevant Tax Returns required to be filed in
respect of such Transfer Tax, pay the Transfer Tax shown on such Tax Return,
and notify the other parties in writing of the Transfer Tax shown on such Tax
Return and how such Transfer Tax was calculated.

Section 10.2         
Amendment and Modification.  This Agreement may be amended,
modified and supplemented in any and all respects, but only by a written
instrument signed by the Purchaser and Parent expressly stating that such
instrument is intended to amend, modify or supplement this Agreement.

Section 10.3         
Notices.  All notices and other communications hereunder shall be
in writing and shall be deemed duly delivered: (i) upon receipt if delivered
personally; (ii) three (3) business days after being mailed by registered or
certified mail, postage prepaid, return receipt requested; (iii) one (1)
business day after it is sent by commercial overnight courier service; or (iv)
upon transmission if sent via facsimile with confirmation of receipt to the
parties at the following address (or at such other address for a party as shall
be specified upon like notice:

                                                            (a)               
if to Purchaser, to:

                                        QUALCOMM Incorporated

                                         
  5775 Morehouse Drive

57

                                        San Diego, California  92121

                                       
Attention:  President

                                       
Fax: (858) 658-2100    

                                       
Tel: (858) 587-1121

                                        with a copy to:

                                        DLA Piper US LLP

                                        4365 Executive Drive, Suite 1100

                                        San Diego, California  92121

                                        Attention: Cameron Jay Rains

                                        Fax: (858) 677-1401

                                        Tel: (858) 677-1476

                                                            (b)              
if to Parent or Seller, to:

                                        RF Micro Devices, Inc.

                                        7628 Thorndike Road

                                       
  Greensboro, North Carolina  27409

                                        Attention:  President

                                        Fax:  336.931.7454

                                        Tel:  336.664.1233

                       

                                        with a copy to:

                                        Womble Carlyle Sandridge &
Rice, PLLC

                                        One West Fourth Street

                                        Winston-Salem, North Carolina  27101

                                       
Attention:  Jeffrey C. Howland

                                        Fax:      (336) 733-8371

                                        Tel:       (336) 721-3516

Section 10.4         
Counterparts.  This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when two or more counterparts have been signed by each
of the parties and delivered to the other parties.

Section 10.5         
Entire Agreement; No Third Party Beneficiaries.  This Agreement
and the Confidentiality Agreement (a) constitute the entire agreement and
supersede all prior agreements and understandings, both written and oral, among
the parties with respect to the subject matter hereof and thereof and
(b) are not intended to confer upon any Person other than the parties
hereto and thereto any rights or remedies hereunder.

58

Section 10.6         
Severability.  Any term or provision of this Agreement that is
held by a court of competent jurisdiction or other authority to be invalid,
void or unenforceable in any situation in any jurisdiction shall not affect the
validity or enforceability of the remaining terms and provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.  If the final judgment of a court of
competent jurisdiction or other authority declares that any term or provision
hereof is invalid, void or unenforceable, the parties agree that the court
making such determination shall have the power to reduce the scope, duration,
area or applicability of the term or provision, to delete specific words or
phrases, or to replace any invalid, void or unenforceable term or provision
with a term or provision that is valid and enforceable and that comes closest
to expressing the intention of the invalid or unenforceable term or provision.

Section 10.7         
Governing Law; Venue.  This Agreement shall be governed by and
construed in accordance with the internal laws of the State of California applicable to parties residing in California, without regard applicable
principles of conflicts of law.  Each of the parties hereto irrevocably
consents to the exclusive jurisdiction of any court located within San Diego
County, California in connection with any matter based upon or arising out of
this Agreement or the matters contemplated hereby and agrees that process may be
served upon such party in a manner authorized by the laws of the State of
California and waives, and covenants not to assert, or plead, any objection
which such party might otherwise have such jurisdiction and process.

Section 10.8         
Time of Essence.  Each of the parties hereto hereby agrees that,
with regard to all dates and time periods set forth or referred to in this
Agreement, time is of the essence.

Section 10.9         
Extension; Waiver.  At any time prior to the Closing Date, the
parties may (a) extend the time for the performance of any of the
obligations or other acts of the other parties, (b) waive any inaccuracies
in the representations and warranties of the other parties contained in this
Agreement or in any document delivered pursuant to this Agreement or
(c) waive compliance by the other parties with any of the agreements or
conditions contained in this Agreement.  Any agreement on the part of a party
to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party.  The failure of any party
to this Agreement to assert any of its rights under this Agreement or otherwise
shall not constitute a waiver of those rights.

Section
10.10      Election
of Remedies.  Neither the exercise of nor the failure to exercise a right
of indemnification or to give notice of a claim under this Agreement will
constitute an election of remedies or limit Purchaser or any of the Purchaser
Indemnified Persons in any manner in the enforcement of any other remedies that
may be available to any of them, whether at law or in equity.

Section
10.11      Assignment. 
Neither this Agreement nor any of the rights, interests or obligations
hereunder shall be assigned by any of the parties hereto (whether by operation
of law or otherwise) without the prior written consent of the other parties,
except that Purchaser may assign, in its sole discretion, any or all of its
rights and interests hereunder to any direct or indirect wholly owned
Subsidiary of Purchaser.  Subject to the preceding sentence, this Agreement
shall be binding upon, inure to the benefit of and be enforceable by the
parties and their respective successors and assigns.

59

IN WITNESS
WHEREOF, Purchaser, Parent and Seller  have executed this Agreement or caused
this Agreement to be executed by their respective officers thereunto duly authorized
as of the date first written above.

QUALCOMM INCORPORATED

By:  /s/ WILLIAM E. KEITEL             

Name: Willliam E. Keitel

Title:    Executive Vice President and CFO

RF MICRO DEVICES, INC.

By:  /s/ JERRY D. NEAL                                 

Name:  Jerry D. Neal

Title:    Executive Vice President of Marketing 

             and Strategic Development

RFMD WPAN, INC.

By:  /s/ ROBERT A. BRUGGEWORTH          

Name:  Robert A. Bruggeworth

Title:    President

 

 

 

List of Omitted
Schedules and Exhibits

to that certain

Asset Purchase
Agreement, dated as of December 1, 2006, 

by and among

QUALCOMM
Incorporated, RF Micro Devices, Inc., and RFMD WPAN, Inc.

________________________________________________________________________

Pursuant to Item 601(b)(2) of Regulation S-K, RF Micro
Devices, Inc. hereby agrees to furnish supplementally a copy of any omitted
schedule or exhibit identified below to the Securities and Exchange Commission
upon request.

OMITTED SCHEDULES

Article III Disclosure Schedule

            (i)         Schedule 3.1:               Authorization

            (ii)        Schedule 3.2:               Binding Agreement

            (iii)       Schedule 3.3:               Good Title Conveyed

            (iv)       Schedule 3.4:               Organization;
Qualification of Parent and the Seller

            (v)        Schedule 3.5:               Consents and
Approvals; No Violations

            (vi)       Schedule 3.6:               Governmental
Authorization

            (vii)      Schedule 3.7:               Restrictions on
Business Activities

            (viii)      Schedule 3.8:               Financial Information

            (ix)       Schedule 3.9:               Books and Records

            (x)        Schedule 3.10:             Accounts Receivable

            (xi)       Schedule 3.11:             Disputed Accounts
Payable

            (xii)      Schedule 3.12:             Inventory

            (xiii)      Schedule 3.13:             Equipment Held by
Suppliers

            (xiv)     Schedule 3.14:             Goods Held on
Consignment

            (xv)      Schedule 3.15:             Absence of Certain
Changes

            (xvi)     Schedule 3.16:             Title to Properties;
Encumbrances

            (xvii)     Schedule 3.17:             Real Property

            (xviii)    Schedule 3.18:             Leases

            (xix)     Schedule 3.19:             Equipment

            (xx)      Schedule 3.20:             Environmental Matters

            (xxi)     Schedule 3.21:             Contracts and
Commitments

            (xxii)     Schedule 3.22:             Customers and Suppliers

            (xxiii)    Schedule 3.23:             Insurance

            (xxiv)    Schedule 3.24:             Casualties

            (xxv)    Schedule 3.25:             Litigation

            (xxvi)    Schedule 3.26:             Compliance with Laws

            (xxvii)   Schedule 3.27:             Tax Matters

            (xxviii)  Schedule 3.28:             Employee Benefit Plans

            (xxix)    Schedule 3.29:             Intellectual Property

            (xxx)    Schedule 3.30:             Labor Matters

 

Article III Disclosure Schedule (continued)

            (xxxi)    Schedule 3.31:             Personnel

            (xxxii)   Schedule 3.32:             Potential Conflicts of
Interest

            (xxxiii)  Schedule 3.33:             Propriety of Past
Payments

            (xxxiv)  Schedule 3.34:             Product Liability

            (xxxv)   Schedule 3.35:             Brokers or Finders

            (xxxvi)  Schedule 3.36:             Full Disclosure

Schedule 5.6:                Excluded Employees

Schedule 6.2(j):            Required Amendments

Schedule 9.1(A):          Assets

Schedule 9.1(B):           Assumed Contracts

Schedule 9.1(C):          Financial Information

Schedule 9.1(D):          Required Contract Consents

Schedule 9.1(E):           Excluded Assets

Schedule 9.1(F):           Excluded Business

Schedule G:                  Assumed Liabilities

Schedule H-1:              Assets

OMITTED EXHIBITS

Exhibit A:         Form of Joint Defense Agreement

Exhibit B:          Form of Agreement Regarding Certain Indemnity Claims

Exhibit C:         Retained Know-How Rights

Exhibit D:         Form of Legal Opinion

Exhibit E:          Form of Patent Assignment

Exhibit F:          Form of Trademark Assignment

Exhibit G:         Instrument of Assumption of Liabilities

Exhibit H:         Indenture, Bill of Sale and AssignmentSUPPLY AGREEMENT

EXHIBIT 10.1

SUPPLY AGREEMENT

This Supply Agreement (the "Agreement") made as of this the Effective Date (defined below) AMX, LLC a Delaware Limited Liability company with its principal place of business at 3000 Research Drive, Richardson, Texas 75082  (the "Customer"), and BEST CIRCUIT BOARDS, INC., a Texas corporation (the "Supplier").

RECITALS

WHEREAS, the Customer and the Supplier desire that the Supplier shall act as the exclusive supplier of printed circuit boards as more particularly described on Exhibit A (the "Product") for the Customer under the terms and conditions of this Agreement. 

AGREEMENTS

NOW, THEREFORE, in consideration of the mutual promises and covenants expressed herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

SECTION 1. PURPOSE.

The purpose of this Agreement is to establish a relationship between the Customer and the Supplier for the supply of Product.  The initial requirements of the Product are set forth on Exhibit A.  The requirements of the Product may be modified and supplemented from time to time in accordance with Section 3.2 through the preparation of a new Exhibit A dated after the Effective Date of this Agreement and executed by the parties hereto.  

TERM OF AGREEMENT.

1.1 The term of this Agreement (the "Term") shall commence on the Effective Date and shall continue through the Original Termination Date as set forth on Exhibit A unless sooner terminated as provided herein.  

1.2 Notwithstanding anything to the contrary in Section 2.1, above, this Agreement shall be automatically deemed renewed for successive Two (2) year term (each, a "Termination Date"), unless terminated by either party by written notice to the other party at least thirty (30) days prior to the Original Termination Date or each succeeding Termination Date.

SECTION 2. MANUFACTURING AND SUPPLY OF PRODUCT.

2.1 The Supplier agrees to manufacture or have manufactured Product for and on behalf of the Customer which Product will be made according to the Customer's specifications and in accordance with the purchase orders submitted by the Customer and/or Customer's contract manufacturer from time to time during the Term of this Agreement.  

2.2 The Customer shall be entitled to amend the specifications for Product as it develops improved or alternative Product; provided that the Supplier, in all cases, shall receive advance notice of any changed specifications, and shall be allowed reasonable time, in working with the Customer and its representatives, to develop whatever additional or modified process that may be necessary to manufacture the new or improved Product in accordance with such changed specifications.

2.3 The Customer and its representatives, at their sole cost and expense, shall have the right to inspect the manufacturing process during normal business hours at the manufacturing plant of the Supplier or its subcontractors, which plant may be overseas. The failure to inspect shall not be deemed a waiver of any of the rights of the Customer.  The Customer shall notify the Supplier of its intention to inspect at least ten (10) business days in advance, upon each occasion when it desires to exercise its rights under this paragraph.

SECTION 3. ORDERS

3.1 The Customer shall submit periodic and estimated annual usage of Product, which estimated annual usage may be reviewed quarterly and adjusted as necessary by the Customer and the Supplier.  The estimated annual usage provided by the Customer shall include such information as may be necessary to enable the Supplier to properly plan the manufacture of the Product.  Commencing the fourth calendar quarter of 2006, the Supplier will have manufactured approximately twenty-five percent (25%) of the estimated annual usage during each calendar quarter of this Agreement.  The Supplier shall further maintain an adequate and balanced level of Product inventory which may be necessary to enable the Supplier to promptly fulfill purchase orders from the Customer and/or Customer's contract manufacturer.  If adequate supply is not maintained, Supplier agrees to manufacture Product locally in Texas.

3.2 With respect to each individual order by the Customer for Product, the Customer and/or Customer's contract manufacturer shall submit a written purchase order to the Supplier. Each order shall include:  (a) the quantity and description of the Product to be purchased; (b) the requested delivery dates therefor; (c) shipping and insurance instructions; and (d) any other information that the Customer and/or Customer's contract manufacturer deems necessary or desirable in light of the circumstances of the order.  The Supplier shall accept purchase orders issued to it by the Customer and/or Customer's contract manufacturer by written notification to the Customer within five (5) business days after receipt of each such order. All orders which are consistent with prior ordering patterns shall be deemed accepted five (5) business days after receipt, unless rejected for reasons permitted herein. Purchase orders for Product in excess of historic quarterly usage may be accepted by the Supplier provided that the Customer and/or Customer's contract manufacturer agrees to pay expedited or premium prices for such Product if incurred by the Supplier. The Supplier will package and ship all quantities of Product ordered from it by the Customer and/or Customer's contract manufacturer hereunder in accordance with the Customer's and/or Customer's contract manufacturer instructions.

3.3 Notwithstanding anything to the contrary contained in this Section 4, in the event that the Customer shall not have submitted purchase orders to the Supplier for Product which the Supplier has held in inventory for at least ninety (90) days, the parties agree that, on the ninety-first (91st) day any such Product is held, the Supplier shall ship such Product to the Customer in accordance with the shipping and insurance instructions most recently received by the Supplier for the most recent purchase order fulfilled.

SECTION 4. PRICING

The purchase price paid by the Customer and/or Customer's contract manufacturer for the Product ordered by the Customer shall be at the prices set forth on Exhibit A attached hereto and incorporated herein by reference, plus all applicable taxes and shall be subject to the Supplier's standard terms and conditions.  Any terms of any purchase orders which shall conflict with the terms and provisions of this Agreement shall be of no force and effect and the provisions of this Agreement shall in all cases control the relationship between the parties.  Additionally, the Customer shall reimburse the Supplier for any governmental tariffs or taxes imposed on the import/export of Product from foreign countries.

SECTION 5. PAYMENTS

5.1 Payment for all orders shall be due in full within thirty (30) days following the date of invoice.  All orders shall be sold F.O.B. Wylie, Texas. In case of manufacturing outside the United States, the Customer and the Supplier shall enter into mutually acceptable agreements with regard to delivery terms.  Notwithstanding the destination for shipment and delivery of any orders, all invoices shall be directed to the Customer and/or Customer's contract manufacturer depending on which company issued the purchase order.

5.2 In the event the Customer and/or Customer's contract manufacturer is late in paying of any invoice, the Supplier may discontinue shipments or place the Customer and/or Customer's contract manufacturer on a COD or prepayment basis.  Interest at the rate of the lesser of one percent (1%) per month or the highest annual rate allowed by applicable law will be assessed for overdue invoices.

SECTION 6. LIMITATION OF SUPPLIER'S AUTHORITY

The Supplier shall be an independent contractor.  Under no circumstances shall the Supplier or its representatives, agents or employees be deemed the agent of the Customer for any purpose, nor shall the Supplier enter into any contract or make any representation or commitment in the name of or on behalf of the Customer or attempt to represent in any manner that it is the agent of the Customer.   The Supplier will conduct all of its business in its own name and in such manner as it may deem fit and shall be responsible for paying its own employees.

SECTION 7. CONFIDENTIALITY

7.1 The parties hereto recognize that during the performance of this Agreement, each may have occasion to conceive, create, develop, review, or receive information that is considered or determined by the other party to be confidential or proprietary, including information relating to inventions, patent, trademark and copyright applications, improvements, know-how, specifications, drawings, cost or pricing data, process flow diagrams, customer or vendor lists, bills, ideas, and/or any other written material referring to same ("Confidential Information").  Each party hereto acknowledges and agrees that the Confidential Information of a party is that party's sole and exclusive property.  Confidential Information shall not include information generally known to the public or information developed or known to a party prior to this Agreement or developed without any violation of this Agreement.

7.2 Both during the Term of this Agreement and thereafter:

	The parties agree to maintain in confidence the other party's Confidential Information unless or until (i) such Confidential Information shall have been made public by an act or omission of a Person other than a party hereto, or (ii) the relevant party hereto shall receive such Confidential Information from an unrelated Person on a nonconfidential basis, whichever shall first occur. 

	The parties hereto further agree to use all reasonable precautions to ensure that all Confidential Information of the other party is protected properly and kept from unauthorized Persons or disclosure.

	Each party agrees, upon the written request of the other party hereto, to return promptly to the requesting party all materials, writings, equipment, models, mechanisms, and the like obtained from or through such requesting party, including but not limited to all Confidential Information.

	Each party hereto agrees that it will not, without first obtaining the prior written permission of the other, directly or indirectly utilize such other party's Confidential Information in its own business, except as may be necessary to fulfill such party's obligations under this Agreement.

SECTION 8. REPRESENTATIONS AND WARRANTIES.  

Each party represents and warrants to the other party that the following statements are true, correct, and complete:

A. Corporate Power and Authority.  Each party has all requisite corporate, limited liability company, limited partnership or other power, as applicable, and authority to enter into this Agreement and to carry out the transactions contemplated by, and perform its obligations under, this Agreement.

B. Authorization of Agreements.  The execution and delivery of this Agreement and the performance of the Agreement have been duly authorized by all necessary corporate, limited liability company, limited partnership or other organizational action, as applicable, on the part of the Supplier.

C. Governmental Consents.  The execution and delivery by each party of this Agreement and the performance by each party of this Agreement do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any federal, state or other governmental authority or regulatory body.

D. Binding Obligation.  This Agreement has been duly executed and delivered by each party and this Agreement is the legally valid and binding obligation of each party, enforceable against such party in accordance with its terms.

SECTION 9. TERMINATION.

9.1 Either party may terminate this Agreement on sixty (60) days' written notice to the other party in the event of a breach of any material provision of this Agreement by the other party; provided that, during the 60-day period, the breaching party fails to cure such breach or, should the breach not be curable within said 60-day period, the breaching party has not initiated steps to cure such breach.

9.2 Either party may immediately terminate this Agreement if the other party shall file any action or proceeding, or have filed any action or proceeding against it, under any federal or state bankruptcy, insolvency, reorganization or receivership laws.

9.3 No termination of this Agreement shall in any manner whatsoever release, or be construed as releasing, any party from any liability to the other arising out of or in connection with a party's breach of, or failure to perform, any covenant, agreement, duty or obligation contained herein.

SECTION 10. WARRANTY

All Product purchased pursuant to this Agreement shall be subject to the Supplier's standard warranty.  Product furnished by Supplier pursuant to any and all Customer and/or Customer's contract manufacturer purchase orders issued hereunder shall be deemed non-conforming if they are defective or fail to comply in any way with Supplier's product specifications and/or instructions.  Customer may return non-conforming Product to Supplier for credit, refund of purchase price, repair, or replacement at Customer's sole option; Supplier shall bear all costs and risk of loss.  Product returned to Supplier for replacement shall be shipped within five (5) business days following receipt thereof.

10.2 Indemnity.  To the extent representations, warranties or commitments are extended by Customer to End Users or any other person, such representations, warranties, and commitments will be those of the Customer alone and will not be attributed to Supplier, and Customer agrees to defend, indemnify and hold Supplier harmless against any and all claims by any third parties whatsoever arising by reason of any such representations, warranties or commitments made by the Customer.

SECTION 11. TRANSFER AND ASSIGNMENT

Neither party may sell, assign, or otherwise transfer this Agreement or any of their rights or obligations hereunder to any other party without the express written consent of the non-assigning party; provided, that the Customer may, in accordance with applicable law and upon written notice to the Supplier, at any time and from time to time assign all or any part of its rights and obligations under this Agreement in connection with any Change of Control (as hereinafter defined).  "Change of Control" means the sale of all or substantially all of the assets of the Customer or a sale or transfer of a majority of the capital stock of the Customer in one or more transactions.  

SECTION 12. BINDING AGREEMENT

This Agreement shall be binding on the parties hereto, and their permitted assigns, representatives and successors.

SECTION 13. CHANGES AND ALTERATIONS

No modification, addition or renewal of or to this Agreement shall be effective unless in writing and properly executed by the parties hereto.

SECTION 14. NOTICES

All notices required hereunder from either party hereto to the other shall be in writing and shall be considered to have been duly given or served if delivered personally or sent by certified or registered mail, return receipt requested, postage prepaid, to the other party at its address set forth on the signature page hereto or at such other address of which notice has been given in accordance with this Agreement.  Notices shall be deemed effective on the date of delivery, if delivered personally, or three (3) business days after mailing, if mailed.

SECTION 15. WAIVER OF BREACH

One or more waivers of any breach of any covenant, term, or condition of this Agreement by either party shall not be construed as a waiver of a subsequent breach of the same or any other covenant, term, or condition.

SECTION 16. GOVERNING LAW

This Agreement shall be interpreted in accordance with and governed by the internal laws of the State of TEXAS without regard to principles of conflicts of laws.

SECTION 17. CONTRACT TERMS EXCLUSIVE

This Agreement and the Exhibits attached hereto constitute the entire agreement between the parties with respect to the subject matter hereof and may not be contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties.  The parties acknowledge and agree that neither has made any representations with respect to the subject matter of this Agreement or any representations inducing the execution and delivery hereof except as specifically set forth in this Agreement. 

SECTION 18. SEVERABILITY

.  Any provision hereof held to contravene the law of any jurisdiction shall be deemed deleted herefrom, and all other provisions hereof shall remain in full force and effect.

SECTION 19. FORCE MAJURE

Neither party will be liable for any failure or delay in its performance under this Agreement due to any cause beyond its reasonable control, including acts of war or terrorism, acts of God, earthquake, flood, embargo, riot, sabotage, labor shortage or dispute, governmental act, or failure of the Internet, provided that the delayed party: (a) gives the other party prompt notice of such cause, and (b) uses commercially reasonable efforts to correct such failure of delay in performance promptly.  Notwithstanding anything to the contrary stated herein, this Agreement and the parties' performance of the obligations entered upon herein shall be subject to all laws, both present and future, of any government having jurisdiction over the Parties and to the orders, regulations, and directions of any such government or any department, agency, or corporation thereof.

 12.01 Construction.  This Agreement is the product of joint draftsmanship and shall not be construed against one party more strictly than against the other.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date.

Effective Date: November 30, 2006

SUPPLIER:

Best Circuit Boards, Inc., a Texas corporation

By: __________________________________

Name:Brad J Peters

Title:CFO

Addresses:

901 Hensley

Wylie, Texas 75098

 

CUSTOMER:

_______________________________________

AMX, LLC 

3000 Research Drive

Richardson, TX 75082

By: ____________________________________

Name: __________________________________

Title: ___________________________________

 

Exhibit A

PRICING SCHEDULE

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