February 20, 2004

Attention: Purchasing Manager or Philips Semiconductors' Products Manager
Subject: Philips Caen Fire Special Product Discontinuation Notice Number DN-51

Dear Philips Semiconductors Customer or Distributor:

This Product Discontinuation Notice Number DN-51 replaces prior early alert information regarding the subject matter of this notice and Philips' products affected by the Caen fire.

As previously announced by Philips Semiconductors ("Philips"), including Philips' December 31, 2003 Product Discontinuation Notice Number DN-50, on December 12, 2003, Philips' wafer manufacturing facility in Caen, France had a fire that caused significant damage to the facility, its equipment and work-in-process. Fortunately, there was no loss of life as a result of this catastrophic event. Luckily, this fire did not spread to other parts of Philips' Caen complex of buildings that support a variety of other non-wafer manufacturing business activities that still remain in full operation.

After carefully assessment, Philips has determined that the damage to its Caen wafer fabrication plant was significant enough that Philips will no longer be capable of the production of many of the semiconductor part types that the Caen facility had been manufacturing. Many of the products that were being produced in the Caen plant are legacy products that utilize older Philips' wafer processes with no internal alternate fabrication capabilities. Philips' supply of these affected products is limited only to remaining product die and finished product inventories not affected by the fire since there is no possibility of further manufacture of these products by Philips. Therefore, Philips is hereby issuing this Product Discontinuation Notice Number DN-51 to permanently discontinue the specific Caen fire semiconductor products listed in Exhibit A. Any Caen products that have existing dual die sourcing within Philips are still available and are not listed in this product discontinuation notice.

Because the discontinuation of the products in this notice is due to a plant fire, this notice is deemed to be the result of an event beyond Philips' control ("a Force Majeure event"). As such, the legal conditions applicable Force Majeure apply to this DN-51 notice and to Philips performance related to the products affected by the Caen fire.

Since December 12th, Philips Executive Management Team, together with the Caen plant technical team and Philips' affected product line managers, have diligently worked to minimize the impact of this fire to the extent possible to our customers by: (a) giving early alert information through Philips global communication channels (b) allocating remaining limited product inventories to customers within Philips product allocation procedures, (c) increasing or switching the manufacturing capabilities of a limited number of part types to other Philips' plants where reasonable production can be made within available processes and technology, (d) identifying any alternate industry suppliers for affected multiple source products, and (e) exploring the possibility of entering into an agreement with a third party to create an alternate source of a limited number of the affected part types.

As noted above, some of the affected part types are internally dual sourced and can still be manufactured by Philips in its' other wafer fabrication plants. These part types are NOT being discontinued by this DN-51 notice and are still available from Philips. A number of the affected Philips" Caen fire part types are multiple sourced where a source of supply may still be available in the industry. Please contact your local Philips account or sales manager for additional information on the dual sourced Philips Caen part types, or known alternate industry sources of supply.

Philips has previously discontinued certain products manufactured by our Caen plant on prior discontinued products notices ("DNs"). These discontinued part types are NOT being listed again on Exhibit A to this DN-51 notice. However, the last time ordering availability for these previously discontinued products that are still active may have been affected due to the Caen fire where product inventories are limited or do not now exist. A list of these identified previously discontinued part types is attached to this DN-51 notice as Exhibit B. This notice hereby supercedes the last time ordering and supply conditions for those affected previously discontinued products on such prior Philips DN notices. Please contact your local account or sales person, or product marketing representative to confirm the current availability status of these previously discontinued products.

For certain discontinued linear products, Philips is actively engaged in negotiating a third party transfer agreement. Philips will issue a separate CPCN notice with full product transfer details once this third party agreement is closed.

This letter officially confirms to your company that Philips Semiconductors is permanently discontinuing the manufacture of the 359 Caen end products listed on Exhibit A to this letter. This Exhibit A parts list may also cover a number of versions or selections of the same basic product. Due to Caen fire circumstances, the majority of these new discontinued products have either Code 1, availability ("Not Available - Cannot Be Manufactured- No Supply Possible") or Code 2 availability ('Limited Supply Available"). Refer to Section B, Subsection 7 below for additional explanation.

A. DISCONTINUED PRODUCT NOTIFICATION

1. Philips Semiconductors has an extensive discontinued products ("EOL") public web-site that contains recent product discontinuation notices and other general information about Philips discontinued product policy and process. This DN-51 product discontinuation notice can also be found on this web-site after March 1, 2004. Additionally, any updated information concerning this DN-51 notice, and its listed discontinued products, will be posted onto this web-site as such information may become available. We encourage you to visit our e-business discontinuation site at the following Philips' internet address: http://www.nxp.com/eol

B. DISCONTINUED PRODUCTS: EXHIBIT "A" CODING

The attached information, format and coding structure applies to Exhibit A and to this DN-51 notice. This format is designed for data sorting of key information and coding fields as described below:

1. Philips' Type Number: (Column 1):
The first column contains Philips full part number as carried by Philips part number system ("Impulse System").

2. Philips North America (N. A.) Part Number (Column 2):
Certain older Philips' part types may also be sold under Philips North America's part number system and may carry duplicate part number identifiers. In the event that there is a different North America callout for some of these products, two different part numbers will be shown for the same Philips' discontinued Type Number (e.g. Philips' Type Number and Philips' North America Part Number represent the same product being discontinued). If there is a blank in the North America ("NA") Part Number column for a Philips' Type Number, then a unique North America Part Number for that Philips' Type has not been identified.

3. Philips' Part Number Description (Column 3):
This column lists Philips' short product description ("SSPD") or a brief product description of the discontinued product supplied by the product group.

4. Philips' 12NC Number (Column 4):
Exhibit A also includes a column designated as "12NC Number". This number represents Philips Semiconductors' master internal manufacturing control identification number for reference to each part type, or version of the part type (end part number), being discontinued.

5. Discontinuation Type Code: (Column 5):
Code "T": Discontinuation of full Philips' Type & North America Part Number: All Part Type packaging and packing method options are discontinued.
Code "N": One of the part type package options is pruned (at least one other package option of the same product is still available).

6. Source Code (Column 6):
Code "M": Discontinued products covered by this notice considered to be industry multiple-source products are coded with an "M" in the "Source Code" column in Exhibit A.
Code "S": Discontinued products known as industry sole-source products are coded with an "S".
Code "C": Customer specific products are designated with a "C". A customer specific product is a part type that is uniquely produced or processed by Philips for a specific customer only.

7. Source Code (Column 7):
Non-Availability - Code "1": A number of the Caen fire discontinued part types may not be available and are identified with "Code 1" source code. Philips can no longer produce Code 1 products and no inventory supply exists due expressly to the Caen fire circumstances. As such, there is no additional possibility for customer orders from Philips because of the commercially impracticable reasons stated in this notice. For record data sorting purposes only, the date of Philips DN notice is entered for Code 1 Products as the last time ordering and delivery dates (zero days notice applies). Contact Philips sales or product marketing representatives for any further alternate industry sources information.
Limited Availability - Code "2": For limited availability products, a unique manufacturing or limited inventory or time condition exists. Where limited availability coded products are identified, Philips is still capable of taking limited order quantities for the product to be assembled from existing available die stocks of the part types to meet our customers or our distributors commercially reasonable last time buy orders. Code 2 listed products will be scheduled by Philips on a first-come/first-serve basis within Philips product allocation system until the remaining part type inventory is depleted. When the inventory for the limited availability product is depleted, Philips can take no additional last time buy orders for the applicable discontinued part type.
Standard Availability - Code "3": Code 3 products have no known supply restriction and last time customer and distributor orders can be met according to Philips' discontinued product policy.

Last Time Buy ("LTB") - (Column 8):
This column lists the last time order date for the discontinued product. Unless a Non-Availability (Code 1) or Limited Availability (Code 2) shorter time period applies, Philips allows a six (6) month last order period for multiple-source ("M") products, a nine (9) month last order time period for sole-source ("S") and customer specific ("C") products. All LTB dates are measured from the date of this notice ("February 20, 2004"). Dates are shown as "date-month-year".

Last Time Delivery Period (Column 9):
The last delivery date for the discontinued products is listed in Column 9. Unless a limited availability condition and shorter time period is indicated, Philips allows a twelve (12) month delivery time period for discontinued products measured from the date of this notice ("Until February 20, 2005).

Suggested Replacement Part (Column 10):
This column contains any known Philips' or industry replacement products for the discontinued Philips' Type numbers. This is "reference only" information. Philips replacement part designation is NOT intended as a statement of warranty indicating that the listed replacement products are available from a third party or meet the same form, fit, function or performance specifications of the discontinued product until such time as Philips' customer or distributor qualifies such products to their specifications. Contact Philips' local sales or marketing representatives for further assistance concerning any replacement products.

Notice Comments (Column 11):
This area includes any additional information about the discontinued products.

C. LAST TIME BUY TERMS AND CONDITIONS

Carefully review this information and notify your purchasing offices and buyers to place your company's final purchases for available discontinued products with Philips as soon as possible according to the following last time buy terms and conditions.

GENERAL: Last time ordering conditions may vary by product. Refer to Exhibit A. The Last Time Buy Date automatically expires when the final available part type inventory quantity or production unit has been scheduled and/or sold by Philips.

1. DELIVERY DATES:
Last time delivery conditions may vary by product. Refer to the above coding information covering Column 9 of Exhibit A. Philips final delivery date(s) may be affected by limited supply conditions.

2. ORDER PLACEMENT:
Discontinued product orders placed with Philips Semiconductors must be clearly identified as a "Last Time Buy". Each order must: (a) reference DN-51; (b) contain your company's requested delivery dates per this notice; (c) be within the minimum order quantity requirements in an existing volume purchase agreement, or meet Philips Semiconductors' standard minimum order policy; and (d) otherwise conform to all other applicable conditions in this notice.

3. PRICING:
The unit sales price for purchase of the available discontinued products covered by this notice will be as follows:
a.) If a current volume purchase agreement is on file in Philips Semiconductors' contracts-legal department, the unit price will be the effective agreement part type unit price for any unordered product quantities covered by such agreement. For quantities beyond the applicable unordered volume agreement quantity, the unit price will be subject to negotiation.
b.) If a valid offer-to-sell standalone quote is still in effect during the last time ordering period, the unit price shall remain as originally quoted by Philips for the offered part type quantities until the quote has expired, or until the quoted quantities have been purchased.
c.) Where a volume purchase agreement or a Philips' standalone quote is not in effect, the Product unit price will be subject to Philips' individual price quotation of your company's last time buy requirements.

4. ACKNOWLEDGEMENT & DELIVERY:
Philips Semiconductors will acknowledge each acceptable discontinued product order in writing or by Electronic Data Interchange ("EDI"), and will use its good faith efforts to meet your company's requested delivery date(s) wherever possible. However, Philips Semiconductors' acknowledged delivery date(s) are deemed to be approximate because of the special circumstances associated to last time product manufacturing conditions.

5. ORDER ACCEPTANCE/CHANGE CONDITIONS: a.) Philips Semiconductors will accept last time discontinued products orders from your company as "Firm and Final". As such, these discontinued products orders will not be subject to reschedule, cancellation, or termination by your company without Philips Semiconductors prior written authorization and payment of termination charges for the ordered discontinued products at the full product unit sales price.
b.) Philips Semiconductors reserves its right to make changes in the scheduled delivery dates, or to terminate any remaining undelivered quantities of your company's last time buy order(s), at any time, due to changes in Philips Semiconductors' last time manufacturing capabilities, or for commercially impracticable circumstances, which makes delivery not feasible.

6. QUANTITIES:
The following supply conditions apply to final buy quantities for available discontinued products. a.) FIRST: The quantities in any existing unfilled orders and contracts acknowledged by Philips Semiconductors will be honored, then
b.) NEXT: The unfilled quantities in any volume agreement(s) or quantities in unexpired standalone quote(s) will be accepted, and
c.) FINALLY: Philips will shall, where possible, reasonably accept additional quantities of discontinued products that Philips Semiconductors quotes based upon your company's identified requirements.

IN THE EVENT OF CONFLICT FOR LIMITED AVAILABILITY PRODUCTS, THE QUANTITIES FOR THE CUSTOMER'S OR THE DISTRIBUTOR'S ORDERS WILL BE DETERMINED ON A "FIRST-COME FIRST-SERVE BASIS". THESE PRODUCTS WILL ALSO BE SUBJECT TO PHILIPS' AVAILABLE INVENTORY AND REMAINING MANUFACTURING CAPACITY FOR THE PRODUCT.

7. DISTRIBUTION SALES:
If you are a Philips Semiconductors' distributor customer, contact your authorized Philips' distributor sales representative for assistance in planning and making any last time purchase(s) of available discontinued products. Such purchases are to be negotiated solely between your company and with the distributor. You may also find additional information about Philips Semiconductors' discontinued products on our discontinued products internet web-site at: "http://www.nxp.com/eol"

D. LIMITED WARRANTY

All discontinued product orders subject to this notice shall carry (a) Philips Semiconductors' standard limited warranty as contained in Philips Semiconductors' order acknowledgement or confirmation form, or (b) the applicable warranty set forth in a duly executed formal contract between Philips Semiconductors; provided that:

Philips Semiconductors will accept all valid discontinued product warranty claims for credit only, unless a replacement order is otherwise agreed to by Philips and the replacement product(s) can still be manufactured or otherwise delivered from Philips' remaining product inventory, and the applicable warranty period for making any return claims for discontinued products subject to this notice will be no longer than ninety (90) days following delivery of the discontinued products, and any return claims must be made under Philips Semiconductors' current Return Material Authorization ("RMA") procedures.

E. DISCLAIMER AND ADDITIONAL PROVISIONS

Except as provided for elsewhere in this notice, the applicable terms and conditions of sale for Philips' discontinued products will be the unmodified terms and conditions in Philips Semiconductors' standard order acknowledgement or order confirmation form, incorporated herein in its entirety by this reference, including any Force Majeure provisions. Otherwise, the applicable, the terms and conditions contained in a duly signed contract in force between our companies shall apply.

PHILIPS SEMICONDUCTORS ACCEPTS NO LIABILITY FOR EXCESS REPROCUREMENT COSTS, LABOR COSTS, OR LIABILITY FOR ANY SPECIAL DIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES WHATSOEVER ASSOCIATED TO PHILIPS SEMICONDUCTORS' DISCONTINUED PRODUCTS, OR ASSOCIATED TO PHILIPS FINAL MANUFACTURE AND PERFORMANCE AGAINST ANY LAST TIME BUY ORDERS RELATED TO THE DISCONTINUED PRODUCTS COVERED BY THIS NOTICE.

PHILIPS FURTHER DISCLAIMS ANY THIRD PARTY DISCONTINUED PRODUCTS INFORMATION PROVIDER'S PUBLICATION OF PHILIPS' PRODUCT DISCONTINUATION INFORMATION CONTAINED IN THIS NOTICE TO PHILIPS CUSTOMERS, DISTRIBUTORS OR TO THE GENERAL MARKETPLACE.

For specific product inquiries in this notice, contact your local Philips Semiconductors' sales or distributor representative. General questions regarding this discontinuation notice should be referred to myself, or to Ms. Patricia Griffin, Philips Semiconductors' Contracts Department, San Jose, California at: Phone: (408) 474-8108, Fax: (408) 474-8325, Email: Patricia Griffin.

Our account management, sales, marketing and distribution support personnel stand ready to assist you in providing additional Caen fire discontinued product supply and related information that may assist your company. On behalf of Philips Semiconductors, we regret any inconvenience that this DN-51 notice may cause your company due to these extraordinary Caen fire circumstances. We appreciate your patience and understanding in helping us to help you minimize the impact of this unplanned product discontinuation on your company to the extent it is commercially possible for Philips to do so.

Very truly yours,

PHILIPS SEMICONDUCTORS

Craig Ash
February 20, 2004

Enclosures:
Exhibit A - DN-51 Caen Fire Special Product Discontinuation Notice Dated February 20, 2004.
Exhibit B - Identified Caen Previously Discontinued Products

Contracts-Legal Department
Email: Craig Ash