Share Pledge

SHARE PLEDGE


This Share Pledge dated as of March 11, 1998 made by PMC-SIERRA, INC. (the "Corporation"), a corporation incorporated under the laws of Delaware, to and in favour of CIBC INC. (the "Lender"), as lender under the Credit Agreement hereinafter referred to.


WHEREAS:


A. The Corporation has entered into a credit agreement dated as of the date hereof with the Lender (as such agreement may at any time or from time to time be amended, supplemented or otherwise modified or restated, the "Credit Agreement") and the Corporation has guaranteed by a guarantee dated as of the date hereof all indebtedness, liabilities and obligations of PMC - Sierra Ltd. ("PMC") to Canadian Imperial Bank of Commerce ("CIBC") under a credit agreement between PMC and CIBC dated as of the date hereof.


B. The Corporation is as at the date hereof the holder of all of the issued and outstanding voting shares in the capital of PMC and has agreed to pledge in favour of the Lender those shares described in Schedule A hereto (the shares in Schedule A hereto are referred to, collectively, as the "Shares").


C. It is a condition of the advance of the said credit facilities by the Lender to the Corporation that the Corporation execute and deliver this Share Pledge together with the share certificates representing the Shares (the "Certificates"), duly endorsed in blank for transfer, to and in favour of the Lender as security for the payment and performance of all indebtedness, liabilities and obligations of the Corporation to the Lender hereunder and under the Credit Agreement as well as other dealings by which the Corporation may become indebted or liable to the Lender in any manner whatsoever pursuant to the Credit Agreement (the "Obligations").


NOW THEREFORE WITNESSETH that in consideration of these premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the Corporation, the Corporation covenants, declares and agrees as follows:


1. Definitions. All terms defined in the Credit Agreement and not otherwise defined herein or in the recitals hereto shall have the respective meanings attributed to them in the Credit Agreement.


2. Pledge of Shares. The Corporation hereby assigns, mortgages, charges, hypothecates and pledges to and deposits with the Lender, and grants to the Lender a security interest in, the Shares and the Certificates together with all replacements thereof, substitutions therefor, accretions thereto, interest thereon and proceeds thereof, including, without limitation, any dividends, income or revenue therefrom (the whole being herein called the "Pledge"), to be held by the Lender as general and continuing collateral security for the payment and performance of the Obligations.


3. Representations and Warranties. The Corporation represents and warrants to the Lender that: (i) the Shares are free and clear of all mortgages, charges, security interests, Liens and other encumbrances; (ii) the Corporation is the beneficial owner of the Shares; and (iii) the Corporation is entitled to grant the assignment and charges as provided for herein.


4. Delivery of Certificates. The Certificates endorsed in blank for transfer shall forthwith be delivered to and remain in the custody of the Lender or its nominee. Upon an Event of Default or any other act which would permit the Lender to demand payment of the Obligations, any or all Shares may, at the option of the Lender, be registered in the name of the Lender or its nominee. The Corporation covenants to deliver such stock powers and similar documents with respect to the Shares as the Lender or its nominee may reasonably from time to time request, satisfactory in form and substance to the Lender. If the charter documents of PMC restrict the transfer of the Shares of such company, then the Corporation shall also deliver to the Lender a resolution of the directors or shareholders of such company consenting to the transfer(s) contemplated by this Pledge.


5. Realization of the Shares. Upon the failure of the Corporation to pay or perform any of the Obligations on demand or otherwise when due and payable or to be performed, as the case may be or upon the occurrence of an Event of Default or any other act which would permit the Lender to demand payment of the Obligations, the Lender or its agent may realize upon or otherwise deal with or dispose of the Shares by public or private sale, transfer or delivery or exercise and enforce all rights and remedies of a holder of the Shares as if the Lender were absolute owner thereof for such price in money or other consideration and upon such terms and conditions as it deems best, the whole, without notice to or control by the Corporation. Any such remedy may be exercised separately or in combination and shall be in addition to and not in substitution for any other rights the Lender may have, however created, provided that the Lender shall not be bound to exercise any such right or remedy. The Lender shall not be bound under any circumstances to realize upon the Shares and neither the Lender nor its agents shall be responsible for any loss occasioned by any sale or other dealing with the Shares permitted by and made in accordance with law, or by the retention of or delay or failure to sell or otherwise deal with or dispose of the Shares and the Lender is hereby released from all responsibility for any depreciation in or loss in value which the Shares may suffer.


6. Power of Attorney. From and after the date of an Event of Default or any other act which would permit the Le ...