TAX SHARING AGREEMENT

          3.          In the event that SILICONIX’s federal or state tax return is prepared in accordance with Paragraph 2 and such tax return discloses a tax liability, SILICONIX shall pay such tax liability to VISHAY on the dates and in the amounts it would have been required to pay such tax liability to the Internal Revenue Service or to the state fiscal authorities had it filed such tax return directly with the federal or state tax authorities. Interest and penalties for underpayments, overpayments and late payments will apply in the same manner as if all tax payments were made directly to the Internal Revenue Service or the state tax authorities.  At Vishay’s option, payments for interest and penalties may be waived.

          4.          Any tax proceeding (whether involving a refund claim, audit or deficiency, proposed or determined) which arises or is commenced by VISHAY or its designee with respect to the consolidated, unitary, or combined federal or state income tax liability of the VISHAY Group for any taxable year of which SILICONIX is or was included or includible as a member of the VISHAY Group, shall be controlled, commenced, defended, or prosecuted solely by VISHAY or its designee, in consultation with counsel and accountants selected by VISHAY, with SILICONIX to bear a proportionate and properly allocable share of  the cost and expense of said proceeding; provided however, that VISHAY or its designee shall consult with SILICONIX in good faith if and to the extent that the conduct of such tax proceeding may affect SILICONIX’s rights and obligations under this agreement, and provided further that if any such proceeding shall involve a separate return year carryback of SILICONIX for which a payment was made under Paragraph 7, SILICONIX shall bear the cost and expense of that proceeding.  Any tax proceeding with respect to a separate company federal or state tax liability or tax return of SILICONIX, for any tax period during which it is part of the VISHAY Group shall be controlled by VISHAY or its designee, in consultation with SILICONIX and with SILICONIX to bear all costs and expenses of said proceeding.

          5.          In the event SILICONIX separates from the VISHAY Group, if there is any unused federal or state net operating loss or tax credit generated by SILICONIX prior to the date of separation computed pursuant to Paragraph 2, VISHAY shall pay SILICONIX an amount equal to the reduction in the consolidated, unitary, or combined income tax liability, of the VISHAY Group for any year (whether or not subsequent to the period in which such loss or credit occurs) as a result of using such net operating loss or tax credit.   The reduction in the consolidated, unitary, or combined income tax liability shall be determined on a basis of with and without the SILICONIX net operating loss or tax credit and shall be determined in accordance with the US federal consolidated return Treasury regulations and applicable state rules, taking into account all tax credits, all carryback and carryforward items, and all special tax classifications which would be available to VISHAY.