VLSI TECHNOLOGY INC, 10-K/A, 1994-04-12

VLSI TECHNOLOGY INC
10-K/A, 1994-04-12
SEMICONDUCTORS & RELATED DEVICES

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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549
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FORM 10-K/A

AMENDMENT NO. 1

<TABLE>
<S> <C>
(MARK ONE)
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 25, 1993
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 0-11879
</TABLE>

VLSI TECHNOLOGY, INC.
(Exact name of Registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)

94-2597282
(I.R.S. Employer
Identification No.)

1109 McKay Drive
San Jose, California 95131
(Address of principal executive offices, including zip code)

Registrant's telephone number, including area code: (408) 434-3000
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Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:
Common Stock, par value $.01 per share
(Title of class)

Common Share Purchase Rights
(Title of class)
------------------

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ X ]

The aggregate market value of the voting stock held by non-affiliates of
the Registrant as of March 11, 1994 was approximately $399,455,296 based upon
the last sale price reported for such date on the NASDAQ National Market System.
For purposes of this disclosure, Common Stock held by persons who hold more
than 5% of the outstanding voting shares and Common Stock held by executive
officers and directors of the Registrant have been excluded in that such persons
may be deemed to be "affiliates" as that term is defined under the rules and
regulations promulgated under the Securities Act of 1933. This determination is
not necessarily conclusive.

As of March 11, 1994, the number of shares of the Registrant's Common Stock
outstanding was 35,385,582.

DOCUMENTS INCORPORATED BY REFERENCE

Parts of the following document is incorporated by reference in this
Annual Report on Form 10-K: the Proxy Statement for the Registrant's Annual
Meeting of Stockholders to be held May 5, 1994 (the "Proxy Statement"),
(Part I and III).

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PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a) 1. Financial Statements

The financial statements (including the notes thereto) listed in the
accompanying index to financial statements and financial statement
schedules are filed within this Annual Report on Form 10-K.

2. Financial Statement Schedules

The financial statement schedules listed in the accompanying index to
financial statements and financial statement schedules are filed as part of
this Annual Report on Form 10-K.

3. Exhibits

The exhibits listed under Item 14(c) hereof are filed as part of this
Annual Report on Form 10-K.

(b) Reports on Form 8-K

The Company filed two reports on Form 8-K during the fourth quarter ended
December 25, 1993. The Company filed a Report on Form 8-K dated December 3,
1993 under Item 5 thereof in order to report a reduction in orders from
Apple and the possible effect on results of operations for 1994. The
Company also filed a Report on Form 8-K dated December 6, 1993 under Item 5
thereof in order to report the filing of a class action lawsuit against the
Company and certain current and former executive officers of the Company.

1
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<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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3.1 Restated Certificate of Incorporation filed with the Secretary of State
of the State of Delaware on September 16, 1987. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 27, 1987.
3.2 Certificate of Designation of Rights, Preferences and Privileges of
Series A Participating Preferred Stock filed with the Secretary of State
of the State of Delaware on August 12, 1992. Incorporated by reference
from Exhibit to Quarterly Report on Form 10-Q for the fiscal quarter
ended September 26, 1992.
3.3 Certificate of Amendment of Restated Certificate of Incorporation filed
with the Secretary of State of the State of Delaware on August 20, 1992.
Incorporated by reference from Exhibit to Quarterly Report on Form 10-Q
for the fiscal quarter ended September 26, 1992.
3.4 Restated Bylaws of the Company, as amended, effective August 27, 1993.
Incorporated by reference from Exhibit to Quarterly Report on Form 10-Q
for the fiscal quarter ended September 25, 1993.
4.1 The Company hereby agrees to file upon request of the Commission a copy
of all instruments, not otherwise filed, with respect to long-term debt
of the Company or any of its subsidiaries for which the total amount of
debt authorized under such instrument does not exceed 10% of the total
assets of the Company and its subsidiaries on a consolidated basis.
4.2 See Exhibits 3.1, 3.2 and 3.3.
4.3 Indenture, dated as of May 1, 1987, between the Company and Citibank
N.A., Trustee, with respect to issuance of $57,500,000 of 7% Convertible
Subordinated Debentures due May 1, 2012. Incorporated by reference from
Exhibit to Registration Statement on Form S-3, No. 33-13463.
4.4 Form of 7% Convertible Subordinated Debenture due May 1, 2012.
Incorporated by reference from Exhibit to Registration Statement on Form
S-3, No. 33-13463.
4.5 Common Shares Rights Agreement, dated as of November 7, 1989, by and
between the Company and the First National Bank of Boston, as Rights
Agent, including the form of Rights Certificate attached as Exhibit A
thereto. Incorporated by reference from Exhibit to Registration Statement
on Form 8-A filed with the Securities and Exchange Commission on November
20, 1989.
4.6 First Amended and Restated Rights Agreement (the "Restated Rights
Agreement") by and between the Company and First National Bank of Boston,
dated August 12, 1992, including form of Rights Certificate. Incorporated
by reference from Exhibit to Quarterly Report on Form 10-Q for the fiscal
quarter ended September 26, 1992.
4.7 Amendment Number 1 to the Restated Rights Agreement, dated August 24,
1992. Incorporated by reference from Exhibit to Quarterly Report on Form
10-Q for the fiscal quarter ended September 26, 1992.
10.1* Letter Agreement between the Company and Alfred J. Stein, dated March 1,
1982. Incorporated by reference from Exhibit to Registration Statement on
Form S-1, No. 2-81485.
10.2* 1982 Incentive Stock Option Plan, as amended May 9, 1991, and form of
option agreement used thereunder. Incorporated by reference from Exhibit
to Annual Report on Form 10-K for the fiscal year ended December 28,
1991.
</TABLE>

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<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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10.3* 1983 Junior Incentive Stock Plan, as amended, and form of agreement used
thereunder. Incorporated by reference from Exhibit to Annual Report on
Form 10-K for the fiscal year ended December 25, 1983.
10.4* Registration Rights Agreement dated as of January 16, 1984 among the
Company and certain security holders of the Company. Incorporated by
reference from Exhibit to Registration Statement on Form S-1, No.
2-81485.
10.5* Executive Performance Incentive Plan. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
29, 1985.
10.6* 1986 Directors' Stock Option Plan, as amended, and Forms of Option
Agreement for use with such plan. Incorporated by reference from Exhibit
to Annual Report on Form 10-K for the fiscal year ended December 28,
1986.
10.7* 1992 Stock Plan and form of option agreement used thereunder.
Incorporated by reference from Exhibit to Annual Report on Form 10-K for
the fiscal year ended December 28, 1991.
10.8 COMPASS Design Automation, Inc. Series A Preferred Stock and Common Stock
Purchase Agreement, dated December 27, 1991. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 28, 1991.
10.9* Amended and Restated Employee Stock Purchase Plan, as amended February
10, 1993. Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 26, 1992.
10.10* COMPASS Design Automation, Inc. 1992 Stock Option Plan. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 26, 1992.
10.11 Proprietary Software OEM License between the Company and Xidak, Inc.,
dated January 1, 1987. Incorporated by reference from Exhibit to Annual
Report on Form 10-K for the fiscal year ended December 27, 1987.
10.12 Joint Venture and Shareholder Agreement, dated as of November 28, 1990,
between Advanced RISC Machines Holdings Limited, Acorn Computers Limited,
Apple Computer (UK) Limited and the Company. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 29, 1990.
10.13 Intercompany Agreement between COMPASS Design Automation, Inc. and the
Company, dated July 1, 1991. Incorporated by reference from Exhibit to
Annual Report on Form 10-K for the fiscal year ended December 28, 1991.
10.14 Technology and Software License Agreement dated September 18, 1991
between Raytheon Company and the Company and COMPASS Design Automation,
Inc. Incorporated by reference from Exhibit to Annual Report on Form 10-K
for the fiscal year ended December 28, 1991.
10.15 Intel/VLSI Stock and Warrant Purchase Agreement between the Company and
Intel Corporation ("Intel"), dated July 8, 1992, including form of
Warrant. Incorporated by reference from Exhibit to Quarterly Report on
Form 10-Q for the fiscal quarter ended September 26, 1992.
10.16*** Technology and Manufacturing Agreement between Intel Corporation and the
Company, dated July 8, 1992, as amended by Addendum Number 1.
Incorporated by reference from Exhibit to Amendment Number 1 to Annual
Report on Form 10-K for the fiscal year ended December 26, 1992.
</TABLE>

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<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
10.17** Addendum #2 to the Technology and Manufacturing Agreement between Intel
Corporation and the Company, dated December 2, 1993. Said document is
included in the Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 25, 1993.
10.18 Distribution Agreement between Schweber Electronics and the Company,
dated March 24, 1987. Incorporated by reference from Exhibit to Annual
Report on Form 10-K for the fiscal year ended December 27, 1987.
10.19 Semi Custom Addendum to Distribution Agreement referenced in Exhibit
10.18. Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 27, 1987.
10.20 Build to Suit Lease, as amended, between the Company and the Mariani
Group of Companies dated as of April 27, 1981, for property located at
1101 McKay Drive, San Jose, California. Incorporated by reference from
Exhibit to Registration Statement on Form S-1, No. 2-81485.
10.21 Amendments dated as of February 24, 1983 and February 1, 1984 to Build to
Suit Lease dated as of April 27, 1981 referenced in Exhibit 10.20.
Incorporated by reference from Exhibit to Annual Report on Form 10-K for
the fiscal year ended December 25, 1983.
10.22 Net Building Space Lease dated February 15, 1985 between Mariani
Financial Company and the Company for a property located at 1865 Lundy
Drive, San Jose, California. Incorporated by reference from Exhibit to
Annual Report on Form 10-K for the fiscal year ended December 30, 1984.
10.23 Amendment to Build to Suit Lease, dated as of April 22, 1992, referenced
in Exhibit 10.20. Incorporated by reference from Exhibit to Annual Report
on Form 10-K for the fiscal year ended December 26, 1992.
10.24 Ground Sublease between Price-Elliott Research Park, Inc., and ADIMIC
Limited Partnership, dated October 1, 1986, for property in Tempe,
Arizona. Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 27, 1987.
10.25 Ground Sublease between Price-Elliott Research Park, Inc., and ADIMIC
Limited Partnership, dated July 1, 1987, for property in Tempe, Arizona.
Incorporated by reference from Exhibit to Annual Report on Form 10-K for
the fiscal year ended December 27, 1987.
10.26 Agreement between ADIMIC Limited Partnership and the Company assigning
interest of lessee under the two Ground Subleases referred to in Exhibit
10.24 and 10.25. Incorporated by reference from Exhibits to Annual Report
on Form 10-K for the fiscal year ended December 27, 1987.
10.27 ASU Research Park Ground Sublease, dated as of December 18, 1990, between
Price-Elliott Research Park, Inc. and the Company. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 29, 1990.
10.28 Lease dated as of May 6, 1988, between Bank Building Partnership and the
Company for property located at 1117 and 1125 McKay Drive, San Jose,
California. Incorporated by reference from Exhibit to Annual Report on
Form 10-K for the fiscal year ended December 25, 1988.
</TABLE>

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<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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10.29 First Amendment to Lease dated as of December 29, 1988, between Bank
Building Partnership and the Company for property located at 1117 and
1125 McKay Drive, San Jose, California. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
25, 1988.
10.30 Second Amendment to Lease dated as of November 20, 1989, between Bank
Building Partnership and the Company for property located at 1117 and
1125 McKay Drive, San Jose, California. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
31, 1989.
10.31 Third Amendment to Lease dated as of March 20, 1990, between Bank
Building Partnership and the Company for property located at 1117 and
1125 McKay Drive, San Jose, California. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
31, 1989.
10.32 Revised Exhibit A to Lease dated May 6, 1988 between Bank Building
Partnership and the Company. Incorporated by reference from Exhibit to
Annual Report on Form 10-K for the fiscal year ended December 31, 1989.
10.33 Lease dated as of August 12, 1991, between Callahan-Pentz Properties,
Ringwood Court One and the Company for property located at 1110 Ringwood
Court, San Jose, California. Incorporated by reference from Exhibit to
Annual Report on Form 10-K for the fiscal year ended December 28, 1991.
10.34 Lease dated as of February 15, 1993, between Sumitomo Life Realty (N.Y.),
Inc. and the Company for property located at 67 South Bedford Street,
Suite 304-W, Burlington, Massachusetts. Incorporated by reference from
Exhibit to Quarterly Report on Form 10-Q for the fiscal quarter ended
March 27, 1993.
10.35 Lease dated as of July 20, 1993, between Callahan-Pentz Properties and
the Company for property located at 1120 Ringwood Court, San Jose,
California. Said lease is included in the Exhibit to Annual Report on
Form 10-K for the fiscal year ended December 25, 1993.
10.36 Commitment Letter between Security Pacific Equipment Leasing, Inc. and
the Company, dated October 27, 1988. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
25, 1988.
10.37 The First National Bank of Boston Line of Credit for the Company and its
subsidiaries, dated November 30, 1988. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
25, 1988.
10.38 Amendment to First National Bank of Boston Line of Credit for the Company
and its subsidiaries, dated November 30, 1989. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 31, 1989.
10.39 Credit Agreement dated as of March 29, 1991 with The First National Bank
of Boston and Bank of America National Trust and Savings Association.
Incorporated by reference from Exhibit to Quarterly Report on Form 10-Q
for the fiscal quarter ended March 30, 1991.
10.40 Amendment dated September 27, 1991, to Credit Agreement dated as March
29, 1991, with The First National Bank of Boston and Bank of America
National Trust and Savings Association. Incorporated by reference from
Exhibit to Quarterly Report on Form 10-Q for the fiscal quarter ended
September 28, 1991.
10.41 Letter Amendment dated October 21, 1992 to Credit Agreement dated as of
March 29, 1991, as amended, with the First National Bank of Boston and
Bank of America National Trust and Savings Association. Incorporated by
reference from Exhibit to Quarterly Report on Form 10-Q for the fiscal
quarter ended September 26, 1992.
</TABLE>

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<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
10.42 Letter Amendment dated January 20, 1993, cancelling the Credit Agreement
dated as of March 29, 1991, and subsequent amendments, with the First
National Bank of Boston and Bank of America National Trust and Savings
Association. Incorporated by reference from Exhibit to Annual Report on
Form 10-K for the fiscal year ended December 26, 1992.
10.43 Loan and Security Agreement between Barclays Leasing, Inc. and the
Company and Amendment thereto, each dated March 28, 1991. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 28, 1991.
10.44 Loan and Security Agreement between Barclays Leasing, Inc. and the
Company and Amendment thereto, each dated September 27, 1991.
Incorporated by reference from Exhibit to Annual Report on Form 10-K for
the fiscal year ended December 28, 1991.
10.45 Loan and Security Agreement between Barclays Leasing, Inc. and the
Company and Amendment thereto, each dated December 27, 1991. Incorporated
by reference from Exhibit to Annual Report on Form 10-K for the fiscal
year ended December 28, 1991.
10.46 Loan and Security Agreement between Barclays Leasing, Inc. and the
Company and Amendment thereto, each dated June 27, 1991. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 28, 1991.
10.47 Equipment Financing Agreement between New England Capital Corporation and
the Company, dated August 12, 1991. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
28, 1991.
10.48 Loan and Security Agreement between LB Credit Corporation and the
Company, dated October 11, 1991 and Amendment thereto, dated November 27,
1991. Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 28, 1991.
10.49 Master Security Agreement between The CIT Group/Equipment Financing, Inc.
and the Company, dated December 19, 1991. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
28, 1991.
10.50 Loan and Security Agreement between Household Bank and the Company, dated
March 25, 1992. Incorporated by reference from Exhibit to Annual Report
on Form 10-K for the fiscal year ended December 26, 1992.
10.51 Loan and Security Agreement between Household Bank and the Company, dated
June 24, 1992. Incorporated by reference from Exhibit to Annual Report on
Form 10-K for the fiscal year ended December 26, 1992.
10.52 Loan and Security Agreement between AT&T and the Company, dated September
24, 1993. Said agreement is identical to two additional agreements dated
September 14, 1993. The first document is included in the Exhibit to
Annual Report on Form 10-K for the fiscal year ended December 25, 1993.
10.53 Loan and Security Agreement and Promissory Note between CIT Group and the
Company, dated December 15, 1993. Said agreement is included in the
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
25, 1993.
10.54 Equipment Leasing Agreement between NEMLC Leasing Associates, No. 3 and
the Company, dated December 19, 1988. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
25, 1988.
10.55 Equipment Leasing Agreement between Valley Bank Leasing, Inc. and the
Company, dated January 10, 1990. Incorporated by reference from Exhibit
to Annual Report on Form 10-K for the fiscal year ended December 31,
1989.
</TABLE>

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<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
10.56 Equipment Lease, dated as of March 26, 1990, between BA Leasing and
Capital Corporation and the Company. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
29, 1990.
10.57 Master Lease Agreement between Sentry Financial Corporation and the
Company, dated January 2, 1991. Incorporated by reference from Exhibit to
Annual Report on Form 10-K for the fiscal year ended December 28, 1991.
10.58 Master Lease 2094759 Lease Renewal Contracts with Guaranteed Purchase
Options between Ellco Leasing Corporation and the Company, each dated
December 30, 1992, relating to Schedules 034, 037, 038, 041 & 043 and
Schedules 044, 045, 046, 048, 049, 050, 051, 052 & 053, respectively.
Incorporated by reference from Exhibit to Annual Report on Form 10-K for
the fiscal year ended December 26, 1992.
10.59 Master Lease 2304202 Lease Renewal Contract with Guaranteed Purchase
Option between GE Capital Corp. and the Company, dated December 30, 1992,
relating to Schedules 002, 003, 004 & 007. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended December
26, 1992.
10.60* Form of Management Continuity Agreement by and between the Company and
each of the following officers of the Company: Donald L. Ciffone, Gregory
K. Hinckley, L. Don Maulsby, Dieter J. Mezger, Thomas F. Mulvaney, C.
Clifford Roe and Alfred J. Stein. Incorporated by reference from Exhibit
to Annual Report on Form 10-K for the fiscal year ended December 26,
1992.
10.61** Technology License dated September 15, 1993 between COMPAQ Computer
Corporation and the Company. Said agreement is included in the Exhibit to
Annual Report on Form 10-K/A for the fiscal year ended December 25, 1993.
10.62** QUADNOTE(TM) Chipset Cooperation Agreement dated September 15, 1993 be-
tween COMPAQ Computer Corporation and the Company. Said agreement is
included in the Exhibit to Annual Report on Form 10-K/A for the fiscal
year ended December 25, 1993.
10.63** SCAMP(TM) IV Chipset Cooperation Agreement dated September 15, 1993
between COMPAQ Computer Corporation and the Company. Said agreement is
included in the Exhibit to Annual Report on Form 10-K/A for the fiscal
year ended December 25, 1993.
11 Calculation of Earnings Per Share (for the three fiscal years ending
December 25, 1993).
21 Subsidiaries of the Company.
23 Consent of Ernst & Young, Independent Auditors (see page 49).
24 Power of Attorney (see page S-8).
</TABLE>

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* Denotes a compensation plan in which an executive officer participates.

** Denotes a document for which SEC confidential treatment has been requested
for selected portions.

*** Denotes a document for which confidential treatment has been granted for
selected portions.

(d) Financial Statement Schedules

See Item 14(a)(2) above.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this amendment to be signed
on its behalf by the undersigned, thereunto duly authorized.

VLSI TECHNOLOGY, INC.
(Registrant)

By: GREGORY K. HINCKLEY
Gregory K. Hinckley
Vice President, Finance and
Chief Financial Officer

Date: April 11, 1994

Pursuant to the requirements of the Securities Exchange Act of 1934, this
amendment has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
Signature Title Date
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<S> <C> <C>
/s/ ALFRED J. STEIN* Chairman of the Board, Chief April 11, 1994
(Alfred J. Stein) Executive Officer, President
(Principal Executive Officer)
and Director

GREGORY K. HINCKLEY Vice President, Finance April 11, 1994
(Gregory K. Hinckley) and Chief Financial Officer
(Principal Financial Officer)

/s/ BALAKRISHNAN S. IYER* Vice President and Controller April 11, 1994
(Balakrishnan S. Iyer) (Principal Accounting Officer)

/s/ PIERRE S. BONELLI* Director April 11, 1994
(Pierre S. Bonelli)

/s/ ROBERT P. DILWORTH Director April 11, 1994
(Robert P. Dilworth)

/s/ JAMES J. KIM* Director April 11, 1994
(James J. Kim)

/s/ HORACE H. TSIANG* Director April 11, 1994
(Horace H. Tsiang)

*By: GREGORY K. HINCKLEY
Attorney-in-fact
</TABLE>
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INDEX TO EXHIBITS

<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. EXHIBIT PAGE NUMBER
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<S> <C> <C>
3.1 Restated Certificate of Incorporation filed with the Secretary -- --
of State of the State of Delaware on September 16, 1987.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 27, 1987.
3.2 Certificate of Designation of Rights, Preferences and -- --
Privileges of Series A Participating Preferred Stock filed with
the Secretary of State of the State of Delaware on August 12,
1992. Incorporated by reference from Exhibit to Quarterly
Report on Form 10-Q for the fiscal quarter ended September 26,
1992.
3.3 Certificate of Amendment of Restated Certificate of -- --
Incorporation filed with the Secretary of State of the State of
Delaware on August 20, 1992. Incorporated by reference from
Exhibit to Quarterly Report on Form 10-Q for the fiscal quarter
ended September 26, 1992.
3.4 Restated Bylaws of the Company, as amended, effective August -- --
27, 1993. Incorporated by reference from Exhibit to Quarterly
Report on Form 10-Q for the fiscal quarter ended September 25,
1993.
4.1 The Company hereby agrees to file upon request of the -- --
Commission a copy of all instruments, not otherwise filed, with
respect to long-term debt of the Company or any of its
subsidiaries for which the total amount of debt authorized
under such instrument does not exceed 10% of the total assets
of the Company and its subsidiaries on a consolidated basis.
4.2 See Exhibits 3.1, 3.2 and 3.3. -- --
4.3 Indenture, dated as of May 1, 1987, between the Company and -- --
Citibank N.A., Trustee, with respect to issuance of $57,500,000
of 7% Convertible Subordinated Debentures due May 1, 2012.
Incorporated by reference from Exhibit to Registration
Statement on Form S-3, No. 33-13463.
4.4 Form of 7% Convertible Subordinated Debenture due May 1, 2012. -- --
Incorporated by reference from Exhibit to Registration
Statement on Form S-3, No. 33-13463.
4.5 Common Shares Rights Agreement, dated as of November 7, 1989, -- --
by and between the Company and the First National Bank of
Boston, as Rights Agent, including the form of Rights
Certificate attached as Exhibit A thereto. Incorporated by
reference from Exhibit to Registration Statement on Form 8-A
filed with the Securities and Exchange Commission on November
20, 1989.
4.6 First Amended and Restated Rights Agreement (the "Restated -- --
Rights Agreement") by and between the Company and First
National Bank of Boston, dated August 12, 1992, including form
of Rights Certificate. Incorporated by reference from Exhibit
to Quarterly Report on Form 10-Q for the fiscal quarter ended
September 26, 1992.
4.7 Amendment Number 1 to the Restated Rights Agreement, dated -- --
August 24, 1992. Incorporated by reference from Exhibit to
Quarterly Report on Form 10-Q for the fiscal quarter ended
September 26, 1992.
</TABLE>
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<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. EXHIBIT PAGE NUMBER
-------- ---------------------------------------------------------------
<S> <C> <C>
10.1* Letter Agreement between the Company and Alfred J. Stein, dated -- --
March 1, 1982. Incorporated by reference from Exhibit to
Registration Statement on Form S-1, No. 2-81485.
10.2* 1982 Incentive Stock Option Plan, as amended May 9, 1991, and -- --
form of option agreement used thereunder. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 28, 1991.
10.3* 1983 Junior Incentive Stock Plan, as amended, and form of -- --
agreement used thereunder. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 25, 1983.
10.4* Registration Rights Agreement dated as of January 16, 1984 -- --
among the Company and certain security holders of the Company.
Incorporated by reference from Exhibit to Registration
Statement on Form S-1, No. 2-81485.
10.5* Executive Performance Incentive Plan. Incorporated by reference -- --
from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 29, 1985.
10.6* 1986 Directors' Stock Option Plan, as amended, and Forms of -- --
Option Agreement for use with such plan. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 28, 1986.
10.7* 1992 Stock Plan and form of option agreement used thereunder. -- --
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 28, 1991.
10.8 COMPASS Design Automation, Inc. Series A Preferred Stock and -- --
Common Stock Purchase Agreement, dated December 27, 1991.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 28, 1991.
10.9* Amended and Restated Employee Stock Purchase Plan, as amended -- --
February 10, 1993. Incorporated by reference from Exhibit to
Annual Report on Form 10-K for the fiscal year ended December
26, 1992.
10.10* COMPASS Design Automation, Inc. 1992 Stock Option Plan. -- --
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 26, 1992.
10.11 Proprietary Software OEM License between the Company and Xidak, -- --
Inc., dated January 1, 1987. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 27, 1987.
10.12 Joint Venture and Shareholder Agreement, dated as of November -- --
28, 1990, between Advanced RISC Machines Holdings Limited,
Acorn Computers Limited, Apple Computer (UK) Limited and the
Company. Incorporated by reference from Exhibit to Annual
Report on Form 10-K for the fiscal year ended December 29,
1990.
10.13 Intercompany Agreement between COMPASS Design Automation, Inc. -- --
and the Company, dated July 1, 1991. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 28, 1991.
</TABLE>
<PAGE> 12

<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. EXHIBIT PAGE NUMBER
<S> <C> <C>
10.14 Technology and Software License Agreement dated September 18, -- --
1991 between Raytheon Company and the Company and COMPASS
Design Automation, Inc. Incorporated by reference from Exhibit
to Annual Report on Form 10-K for the fiscal year ended
December 28, 1991.
10.15 Intel/VLSI Stock and Warrant Purchase Agreement between the -- --
Company and Intel Corporation ("Intel"), dated July 8, 1992,
including form of Warrant. Incorporated by reference from
Exhibit to Quarterly Report on Form 10-Q for the fiscal quarter
ended September 26, 1992.
10.16*** Technology and Manufacturing Agreement between Intel -- --
Corporation and the Company, dated July 8, 1992, as amended by
Addendum Number 1. Incorporated by reference from Exhibit to
Amendment Number 1 to Annual Report on Form 10-K for the fiscal
year ended December 26, 1992.
10.17** Addendum #2 to the Technology and Manufacturing Agreement -- --
between Intel Corporation and the Company, dated December 2,
1993. Incorporated by reference from Exhibit to Annual Report
on Form 10-K for the fiscal year ended December 25, 1993.
10.18 Distribution Agreement between Schweber Electronics and the -- --
Company, dated March 24, 1987. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 27, 1987.
10.19 Semi Custom Addendum to Distribution Agreement referenced in -- --
Exhibit 10.18. Incorporated by reference from Exhibit to Annual
Report on Form 10-K for the fiscal year ended December 27,
1987.
10.20 Build to Suit Lease, as amended, between the Company and the -- --
Mariani Group of Companies dated as of April 27, 1981, for
property located at 1101 McKay Drive, San Jose, California.
Incorporated by reference from Exhibit to Registration
Statement on Form S-1, No. 2-81485.
10.21 Amendments dated as of February 24, 1983 and February 1, 1984 -- --
to Build to Suit Lease dated as of April 27, 1981 referenced in
Exhibit 10.20. Incorporated by reference from Exhibit to Annual
Report on Form 10-K for the fiscal year ended December 25,
1983.
10.22 Net Building Space Lease dated February 15, 1985 between -- --
Mariani Financial Company and the Company for a property
located at 1865 Lundy Drive, San Jose, California. Incorporated
by reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 30, 1984.
10.23 Amendment to Build to Suit Lease, dated as of April 22, 1992, -- --
referenced in Exhibit 10.20. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 26, 1992.
10.24 Ground Sublease between Price-Elliott Research Park, Inc., and -- --
ADIMIC Limited Partnership, dated October 1, 1986, for property
in Tempe, Arizona. Incorporated by reference from Exhibit to
Annual Report on Form 10-K for the fiscal year ended December
27, 1987.
10.25 Ground Sublease between Price-Elliott Research Park, Inc., and -- --
ADIMIC Limited Partnership, dated July 1, 1987, for property in
Tempe, Arizona. Incorporated by reference from Exhibit to
Annual Report on Form 10-K for the fiscal year ended December
27, 1987.
</TABLE>
<PAGE> 13

<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. EXHIBIT PAGE NUMBER
-------- ---------------------------------------------------------------
<S> <C> <C>
10.26 Agreement between ADIMIC Limited Partnership and the Company -- --
assigning interest of lessee under the two Ground Subleases
referred to in Exhibit 10.24 and 10.25. Incorporated by
reference from Exhibits to Annual Report on Form 10-K for the
fiscal year ended December 27, 1987.
10.27 ASU Research Park Ground Sublease, dated as of December 18, -- --
1990, between Price-Elliott Research Park, Inc. and the
Company. Incorporated by reference from Exhibit to Annual
Report on Form 10-K for the fiscal year ended December 29,
1990.
10.28 Lease dated as of May 6, 1988, between Bank Building -- --
Partnership and the Company for property located at 1117 and
1125 McKay Drive, San Jose, California. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 25, 1988.
10.29 First Amendment to Lease dated as of December 29, 1988, between -- --
Bank Building Partnership and the Company for property located
at 1117 and 1125 McKay Drive, San Jose, California.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 25, 1988.
10.30 Second Amendment to Lease dated as of November 20, 1989, -- --
between Bank Building Partnership and the Company for property
located at 1117 and 1125 McKay Drive, San Jose, California.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 31, 1989.
10.31 Third Amendment to Lease dated as of March 20, 1990, between -- --
Bank Building Partnership and the Company for property located
at 1117 and 1125 McKay Drive, San Jose, California.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 31, 1989.
10.32 Revised Exhibit A to Lease dated May 6, 1988 between Bank -- --
Building Partnership and the Company. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 31, 1989.
10.33 Lease dated as of August 12, 1991, between Callahan-Pentz -- --
Properties, Ringwood Court One and the Company for property
located at 1110 Ringwood Court, San Jose, California.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 28, 1991.
10.34 Lease dated as of February 15, 1993, between Sumitomo Life -- --
Realty (N.Y.), Inc. and the Company for property located at 67
South Bedford Street, Suite 304-W, Burlington, Massachusetts.
Incorporated by reference from Exhibit to Quarterly Report on
Form 10-Q for the fiscal quarter ended March 27, 1993.
10.35 Lease dated as of July 20, 1993, between Callahan-Pentz -- --
Properties and the Company for property located at 1120
Ringwood Court, San Jose, California. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 25, 1993.
10.36 Commitment Letter between Security Pacific Equipment Leasing, -- --
Inc. and the Company, dated October 27, 1988. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 25, 1988.
</TABLE>
<PAGE> 14

<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. EXHIBIT PAGE NUMBER
-------- ---------------------------------------------------------------
<S> <C> <C>
10.37 The First National Bank of Boston Line of Credit for the -- --
Company and its subsidiaries, dated November 30, 1988.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 25, 1988.
10.38 Amendment to First National Bank of Boston Line of Credit for -- --
the Company and its subsidiaries, dated November 30, 1989.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 31, 1989.
10.39 Credit Agreement dated as of March 29, 1991 with The First -- --
National Bank of Boston and Bank of America National Trust and
Savings Association. Incorporated by reference from Exhibit to
Quarterly Report on Form 10-Q for the fiscal quarter ended
March 30, 1991.
10.40 Amendment dated September 27, 1991, to Credit Agreement dated -- --
as March 29, 1991, with The First National Bank of Boston and
Bank of America National Trust and Savings Association.
Incorporated by reference from Exhibit to Quarterly Report on
Form 10-Q for the fiscal quarter ended September 28, 1991.
10.41 Letter Amendment dated October 21, 1992 to Credit Agreement -- --
dated as of March 29, 1991, as amended, with the First National
Bank of Boston and Bank of America National Trust and Savings
Association. Incorporated by reference from Exhibit to
Quarterly Report on Form 10-Q for the fiscal quarter ended
September 26, 1992.
10.42 Letter Amendment dated January 20, 1993, cancelling the Credit -- --
Agreement dated as of March 29, 1991, and subsequent
amendments, with the First National Bank of Boston and Bank of
America National Trust and Savings Association. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 26, 1992.
10.43 Loan and Security Agreement between Barclays Leasing, Inc. and -- --
the Company and Amendment thereto, each dated March 28, 1991.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 28, 1991.
10.44 Loan and Security Agreement between Barclays Leasing, Inc. and -- --
the Company and Amendment thereto, each dated September 27,
1991. Incorporated by reference from Exhibit to Annual Report
on Form 10-K for the fiscal year ended December 28, 1991.
10.45 Loan and Security Agreement between Barclays Leasing, Inc. and -- --
the Company and Amendment thereto, each dated December 27,
1991. Incorporated by reference from Exhibit to Annual Report
on Form 10-K for the fiscal year ended December 28, 1991.
10.46 Loan and Security Agreement between Barclays Leasing, Inc. and -- --
the Company and Amendment thereto, each dated June 27, 1991.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 28, 1991.
10.47 Equipment Financing Agreement between New England Capital -- --
Corporation and the Company, dated August 12, 1991.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 28, 1991.
</TABLE>
<PAGE> 15

<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. EXHIBIT PAGE NUMBER
-------- ---------------------------------------------------------------
<S> <C> <C>
10.48 Loan and Security Agreement between LB Credit Corporation and -- --
the Company, dated October 11, 1991 and Amendment thereto,
dated November 27, 1991. Incorporated by reference from Exhibit
to Annual Report on Form 10-K for the fiscal year ended
December 28, 1991.
10.49 Master Security Agreement between The CIT Group/Equipment -- --
Financing, Inc. and the Company, dated December 19, 1991.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 28, 1991.
10.50 Loan and Security Agreement between Household Bank and the -- --
Company, dated March 25, 1992. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 26, 1992.
10.51 Loan and Security Agreement between Household Bank and the -- --
Company, dated June 24, 1992. Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 26, 1992.
10.52 Loan and Security Agreement between AT&T and the Company, dated -- --
September 24, 1993. Said agreement is identical to two
additional agreements dated September 14, 1993. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 25, 1993.
10.53 Loan and Security Agreement and Promissory Note between CIT -- --
Group and the Company, dated December 15, 1993. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 25, 1993.
10.54 Equipment Leasing Agreement between NEMLC Leasing Associates, -- --
No. 3 and the Company, dated December 19, 1988. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 25, 1988.
10.55 Equipment Leasing Agreement between Valley Bank Leasing, Inc. -- --
and the Company, dated January 10, 1990. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 31, 1989.
10.56 Equipment Lease, dated as of March 26, 1990, between BA Leasing -- --
and Capital Corporation and the Company. Incorporated by
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 29, 1990.
10.57 Master Lease Agreement between Sentry Financial Corporation and -- --
the Company, dated January 2, 1991. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 28, 1991.
10.58 Master Lease 2094759 Lease Renewal Contracts with Guaranteed -- --
Purchase Options between Ellco Leasing Corporation and the
Company, each dated December 30, 1992, relating to Schedules
034, 037, 038, 041 & 043 and Schedules 044, 045, 046, 048, 049,
050, 051, 052 & 053, respectively. Incorporated by reference
from Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 26, 1992.
</TABLE>
<PAGE> 16

<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. EXHIBIT PAGE NUMBER
<S> <C> <C>
10.59 Master Lease 2304202 Lease Renewal Contract with Guaranteed -- --
Purchase Option between GE Capital Corp. and the Company, dated
December 30, 1992, relating to Schedules 002, 003, 004 & 007.
Incorporated by reference from Exhibit to Annual Report on Form
10-K for the fiscal year ended December 26, 1992.
10.60* Form of Management Continuity Agreement by and between the -- --
Company and each of the following officers of the Company:
Donald L. Ciffone, Gregory K. Hinckley, L. Don Maulsby, Dieter
J. Mezger, Thomas F. Mulvaney, C. Clifford Roe and Alfred J.
Stein. Incorporated by reference from Exhibit to Annual Report
on Form 10-K for the fiscal year ended December 26, 1992.
10.61** Technology License dated September 15, 1993 between COMPAQ Com-
puter Corporation and the Company said agreement is included in
the Exhibit to Annual Report on Form 10-K for the fiscal year
ended December 25, 1993 .......................................
10.62** QUADNOTE(TM) Chipset Cooperation Agreement dated September 15,
1993 between COMPAQ Computer Corporation and the Company said
agreement is included in the Exhibit to Annual Report on Form
10-K for the fiscal year ended December 25, 1993 ..............
10.63** SCAMP(TM) IV Chipset Cooperation Agreement dated September 15,
1993 between COMPAQ Computer Corporation and the Company said
agreement is included in the Exhibit to Annual Report on Form
10-K for the fiscal year ended December 25, 1993 ..............
11 Calculation of Earnings Per Share (for the three fiscal years -- --
ending December 25, 1993). Incorporated by reference from
Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 25, 1993.
21 Subsidiaries of the Company. Incorporated by reference from -- --
Exhibit to Annual Report on Form 10-K for the fiscal year ended
December 25, 1993.
23 Consent of Ernst & Young, Independent Auditors. Incorporated by -- --
reference from Exhibit to Annual Report on Form 10-K for the
fiscal year ended December 25, 1993.
24 Power of Attorney. Incorporated by reference from Exhibit to -- --
Annual Report on Form 10-K for the fiscal year ended December
25, 1993.
</TABLE>

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

* Denotes a compensation plan in which an executive officer participates.

** Denotes a document for which SEC confidential treatment has been requested
for selected portions.

*** Denotes a document for which confidential treatment has been granted for
selected portions.

<PAGE> 1
Exhibit 10.61

VLSI Confidential

Technology License

This Agreement, entered into as of 15th day of September, 1993 ("Effective
Date") by and between VLSI Technology, Inc., with offices at 1109 McKay Drive,
San Jose, California 95131, ("VLSI") and COMPAQ Computer Corporation, with
offices at 20555 S.H. 249, Houston, Texas, 77070, ("COMPAQ").

Whereas, COMPAQ has specified certain functional elements of a personal
computer system logic and peripheral logic designs meeting the general
specifications to be set forth in Exhibit A hereto (hereinafter "TECHNOLOGY');
and

Whereas, COMPAQ has agreed to license such TECHNOLOGY which may be incorporated
into VLSI Products that are designed for sale to the merchant market; and

Whereas, VLSI desires to license the TECHNOLOGY which may be incorporated into
VLSI Products which are to be sold on the merchant market,

Whereas, VLSI may incorporate all or part of the TECHNOLOGY as an element in
VLSI Products, amd market such Products in significant quantities to COMPAQ
and third parties; and

Now therefore, the parties hereto agree as follows:

1. Design Responsibilities

1.1 VLSI and COMPAQ agree to use their respective best efforts to transfer the
TECHNOLOGY specified in Exhibit A to VLSI, and perform the activities set forth
in the Statement of Work attached hereto as Exhibit B, and to complete each
such activity by the Agreed Completion Date set forth in Exhibit B. Any
documents listed as reference documents in Exhibit A (e.g., tasks, description
of training, or special requirements) shall be deemed incorporated herein, but
only to the extent such documents are not in conflict with other terms of this
Agreement.

1.2 At VLSI's request, and within [ ] of VLSI's request, COMPAQ
agrees to meet with VLSI representatives and provide its input to VLSI on a
TECHNOLOGY Specification and any other similar technical documents that VLSI
has prepared.

1.3 COMPAQ further agrees to schedule telephonic meetings and conference calls
with VLSI within [ ] of VLSI's request to discuss COMPAQ's comments
and/or input to a TECHNOLOGY Specification.

1.4 COMPAQ agrees to review each revision of the TECHNOLOGY Specification
within [ ] (hereafter "Approval Cycle") of its submittal by VLSI and
provide VLSI with its detailed snd substantive comments during the Approval
Cycle.

1.5 COMPAQ agrees to assist VLSI with validation, testing, and debugging of the
specified functionality and PC compatibility of the TECHNOLOGY. Testing

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 2
shall be performed to verify compliance with the agreed-to TECHNOLOGY
Specificiation in accordance with Exhibit B.

1.6 COMPAQ and VLSI have further agreed to cooperate in efforts to develop a
market for SCAMP 4 and QUADNOTE CHIPSETS as is set forth in the Cooperation
Agreement for each respective chipset.

2. Changes to Specification

The specifications for TECHNOLOGY are attached as EXHIBIT A. Any documents
listed as reference documents in Exhibit A (e.g., additional specifications, or
special requirements) shall be deemed incorporated herein, but only to the
extent that such documents are not in conflict with other terms of this
Agreement. Any changes to the specifications of the TECHNOLOGY requested by
COMPAQ shall be subject to agreement by both parties, including any adjustments
to the Schedule.

3. Rights

3.1 COMPAQ will grant to VLSI a [ ] right and license under
COMPAQ's copyrights, know-how, and trade secrets to use (by VLSI's employees,
contractors, subcontractors, and agents), make semiconductor products, have
made semiconductor products, sell such semiconductor products, sub-license
(only as expressly set forth below in Paragraph 3.2), create derivatives and
otherwise distribute as an integral part of a semiconductor any and all
TECHNOLOGY (listed in Exhibit A), including documentation, and software support
for the TECHNOLOGY. VLSI will bear the expense for manufacturing, sale and
support activities regarding integrated circuits that incorporate such
TECHNOLOGY. VLSI shall retain title to mask works and possession of photomasks
and data base tapes.

3.2 VLSI shall further have the right to include and sublicense TECHNOLOGY
and/or VLSI-created derivatives as part of VLSI's Functional System Block
library for use in standard products and custom products manufactured by VLSI
and authorized VLSI second sources. Additionally, VLSI shall have the right to
sublicense its customers to make and have made QUADNOTE and SCAMP IV CHIPSETS
provided the royalties are paid pursuant to the QUADNOTE and SCAMP IV License
Agreements with an Effective Date of September 15, 1993. To the extent that
VLSI wishes to obtain a license to sublicense its customers to make or have
made any products (other than QUADNOTE and SCAMP IV) which include TECHNOLOGY,
the parties agree to negotiate in good faith to reach agreement on such
additional license.

3.3 VLSI shall have no right to use the TECHNOLOGY in [ ].

3.4 COMPAQ retains all necessary rights to make, have made, use and sell
integrated circuits incorporating the TECHNOLOGY as are necessary for its own
computer and peripheral products made by or for COMPAQ and/or sold by COMPAQ
and its subsidiaries. Additionally, COMPAQ retains all necessary rights to
create derivatives, modifications, and improvements to the TECHNOLOGY, and to
make, have made, use and sell any integrated circuits embodying such TECHNOLOGY
derivatives for computer and peripheral products made by or exclusively for
COMPAQ and its subsidiaries.

[ ] Text omitted - CONFIDENTITAL TREATMENT REQUESTED

<PAGE> 3
3.5 COMPAQ will provide, for a period of [ ] following execution of
this Agreement, at no additional charge, any TECHNOLOGY corrections of
functional design errors and nonconformities with the specifications and
fitness for purpose of the licensed TECHNOLOGY.

3.6 The parties agree that this Agreement does not provide for nor require
the disclosure of or grant back of licenses from one party to the other with
respect to derivatives to the TECHNOLOGY, which derivatives differ from a
functional or performance standpoint from the TECHNOLOGY specified in
Exhibit A.

3.7 The parties agree that every [ ], senior managers of the
companies will meet to discuss the possibility of expanding this Agreement, or
entering into a new agreement covering the development of follow-on TECHNOLOGY,
as required to meet the anticipated demand from VLSI's customers, however this
provision shall not be construed as an obligation for either party to license
the other party.

3.8 Each party will own those inventions, and any resulting patents, made by
its own employees during the development of TECHNOLOGY. Each party has the sole
right to determine what patents, if any, will be obtained on its employees'
inventions. Each party will bear its own patent filing expenses with respect to
inventions solely owned by it. Any invention jointly made by employees of both
parties will be jointly owned by both parties with each party exercising an
undivided ownership interest without any obligation to account to the other for
its use and/or disposition. With respect to jointly owned inventions, the
parties will agree, on a case-by-case basis, which party will file patent
applications, if any. The parties will share equally the reasonable cost of
mutually agreed upon U.S. and foreign patent and mask work application filings,
prosecution, issuance, maintenance and the like for jointly owned inventions.
If one party desires to file, prosecute or maintain a patent application or
patent on a joint invention and the other party, on reasonable notification, is
unwilling to share in the expense of doing so, then the one party may proceed
at its own expense and the other party shall forfeit its undivided, one-half
ownership interest, but shall obtain a license in accordance with Section 3
hereof. Each party will have the right independently to license its patent
rights resulting from this joint development.

4. Royalty

4.1 For each VLSI product sold by VLSI that incorporates any separately
defined item of the licensed TECHNOLOGY listed in Exhibit A, if, and only if,
VLSI's customer has been provided access (e.g. the technical features are
available and/or documented for the use of VLSI's third party customers), such
TECHNOLOGY ('LICENSED PRODUCT'), VLSI will accrue a royalty payable to COMPAQ.

4.2 The BASE ROYALTY RATE will be the rate [ ] per unit for
TECHNOLOGY.

4.3 The BASE ROYALTY RATE multiplied by the number of units sold by VLSI
during that period, less adjustments for returns, and units sold to
distributors with right of return and that incorporate TECHNOLOGY will
determine the license fee due to COMPAQ.

4.4 Royalty calculation for modules, boards or other products sold that
contain a royalty-bearing design will be the same amount per unit as paid on
a separate IC component.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 4
4.5 Royalty calculation for a multiple integrated circuit chipset (e.g. VLSI's
SCAMP IV(TM) or Quadnote(TM) chipsets) that is a LICENSED PRODUCT, which is
intended to be sold as a set, rather than as individual ICs, will be [ ]
per chipset.

4.6 Within [ ] after the end of each calendar quarter, VLSI shall
furnish COMPAQ a statement in suitable form, showing the volume of products
incorporating the licensed TECHNOLOGY that were sold, disposed of, or put into
use during such quarter, less adjustments for returns, and units sold to
distributors with right of return (unless VLSI receives payment for such
units). Payment to COMPAQ of the royalty due from VLSI under Section 4,
Royalty, will be made coincident with this report.

4.7 The cumulative total maximum royalty, either paid as set out above or paid
in advance, for the licensed TECHNOLOGY is limited to [ ], and upon
payment of this total license fee, VLSI obtains a [ ] license
[ ], and is no longer obligated to report sales information to COMPAQ.

4.8 VLSI is under no obligation to market any product, or to incorporate this
TECHNOLOGY into any other products.

5. Termination

5.1 This Agreement may be terminated by either party upon a material breach of
this Agreement by the other party. Prior to such a termination, the
non-breaching party shall give the other party [ ] notice. If the
breaching party does not cure the breach, or provide a schedule to cure the
breach to the other party's satisfaction within that period, this Agreement
may be terminated by the non-breaching party. In the event of such a
termination, as the non-breaching party's sole remedy:

5.1.1 If VLSI is the breaching party, and the license is not paid-up,
the licenses granted by COMPAQ to VLSI shall be terminated and VLSI shall have
an obligation to pay royalties due to COMPAQ at the time of the breach. VLSI
shall immediately discontinue further use of the TECHNOLOGY to prototype
additional integrated circuits, and within [ ] after termination of
this Agreement, VLSI shall furnish to COMPAQ a certificate which shall certify
that through its best effort and to the best of its knowledge, the original and
all copies, in whole or in part, in any form of licensed TECHNOLOGY have been
destroyed, and that all use of TECHNOLOGY (including its use in integrated
circuits) has been discontinued, except as provided in Section 11.4.

5.1.2 If COMPAQ is the breaching party, COMPAQ will, within [ ]
of termination, refund all license fees paid by VLSI, and VLSI will have no
further obligation to pay license fees.

5.2 Either party may terminate this Agreement if the other becomes the subject
of a voluntary or involuntary petition in bankruptcy or any proceeding relating
to insolvency, receivership, liquidation or composition for the benefit of
creditors if that petition or proceeding is not dismissed with prejudice within
[ ] after filing.

5.3 Except as specified above regarding material breach or otherwise agreed in
writing by the parties, in the event of termination of this Agreement by
expiration of the term or any extended term, or by mutual agreement, or when

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 5
the license becomes paid up, the licenses set forth herein shall continue in
accordance with their terms for a period not to exceed [ ]. Additionally,
Section 7 shall survive termination for any reason.

5.4 At the termination or expiration of this Agreement, VLSI will continue to
have the right to manufacture, market and sell any products covered by this
Agreement.

6. Warranty

6.1 COMPAQ agrees to correct, and fix any bugs and design deficiencies in
TECHNOLOGY (e.g., maintenance of licensed TECHNOLOGY) so that TECHNOLOGY will
perform in accordance with the written specification, as defined in the
Exhibits hereto, for a period of [ ] from the date of delivery.

6.2 COMPAQ further warrants that it has no current knowledge of any
infringement of intellectual property rights and has not received notice of any
such infringement with respect to the TECHNOLOGY provided by COMPAQ under this
Agreement.

7. Confidential Information

7.1 "Confidential Information" shall mean that information of either party
that is disclosed to the other party ("Recipient") by reason of the parties'
relationship hereunder, either directly or indirectly in any written or
recorded form, orally, or by drawings or inspection of parts or equipment, and,
either in writing and marked as confidential or proprietary, or if oral,
reduced to writing similarly marked within [ ] of disclosure.

7.2 Recipient shall receive and use the Confidential Information only for
performance of Recipient's obligations hereunder, and will not use Confidential
Information for any other purpose, and shall not disclose such Confidential
Information to any person or persons who do not need to have knowledge of such
Confidential Information in the course of their employment.

7.3 Recipient further agrees that except as authorized by the Export
Administration Regulations of the U. S. Department of Commerce it will not
transmit, directly or indirectly, any "technical data" acquired from the other
party hereto, to Afghanistan, the People's Republic of China or any "Q, S, W, Y
or Z" country as those terms are defined in the Regulations.

7.4 It is expressly understood that Recipient shall not be liable for
disclosure of any Confidential Information if the same:

7.4.1 was in the public domain at the time it was disclosed;
7.4.2 was known to Recipient at the time of disclosure;
7.4.3 is disclosed with the prior written approval of the other party
hereto;
7.4.4 is disclosed after [ ] from the date of disclosure;
7.4.5 was independently developed by Recipient; or
7.4.6 becomes known to Recipient, on a non-confidential basis, from a
source other than the other party hereto, without breach of this Agreement by
Recipient.

7.5 COMPAQ further agrees that, any Confidential Information provided by
COMPAQ will be safeguarded by VLSI under procedures similar to those that VLSI

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 6
uses for VLSI's Confidential Information. COMPAQ understands that Confidential
Information may be embodied in TECHNOLOGY that may be incorporated into VLSI
products which may be available for sale to third parties. VLSI will not be
liable for accidental disclosure, or the unauthorized actions or misconduct of
its employees with regard to any TECHNOLOGY embodied in VLSI's products at the
request of COMPAQ. COMPAQ acknowledges that any design features and functions
that are incorporated into VLSI products may be used by VLSI's third-party
customers in implementations and applications that are out of the control of
VLSI.

7.6 The parties agree that it is normal business practice for VLSI's
customers, including COMPAQ, to provide VLSI with Information regarding the
form function, design and features of which are desired to be incorporated into
VLSI PC Chipset integrated circuits. In the case of any Information that
COMPAQ desires to disclose to VLSI that embodies information that COMPAQ
requires consideration from VLSI in order for VLSI to freely incorporate the
information in VLSI's products, then COMPAQ must notify VLSI in writing in
advance of the purpose and the nature of the Information, and obtain the
written permission of an officer of VLSI, prior to disclosing such information
to VLSI. VLSI has the right to refuse such information at its sole option.

8. Indemnity

8.1 COMPAQ shall defend or settle at its option and expense any claim or
action brought against VLSI, alleging that the Information listed in Exhibit A
furnished by COMPAQ under this agreement infringes a patent, copyright, or
trade secret of another, and COMPAQ shall pay any costs, including attorneys
fees and damages awarded against VLSI, that are attributable to such claim or
action, provided that VLSI notifies COMPAQ promptly in writing of the action,
and authorizes COMPAQ to defend or settle the same claim or action.

8.2 If a final injunction is issued against VLSI's or its customer's use of
the TECHNOLOGY, or of the VLSI product which incorporates the TECHNOLOGY,
COMPAQ will at its option and expense either (i) replace or modify the
TECHNOLOGY so that it becomes non-infringing, (ii) procure for VLSI the right
to continue using the TECHNOLOGY, or (iii) in the event that the TECHNOLOGY
cannot be modified or the necessary right obtained under reasonable terms, then
the parties shall negotiate in good faith to reach a settlement regarding the
damages to VLSI, [ ].

8.3 The parties may mutually agree in advance that VLSI may defend or settle
action brought against VLSI or its customers alleging that the TECHNOLOGY
furnished by COMPAQ infringes a patent, copyright, or trade secret of another.
In such a case, COMPAQ will reimburse VLSI for its expenses to procure, replace
or modify the TECHNOLOGY, including any attorneys' fees, license fees,
royalties and damages awarded against VLSI, or set out in a settlement
agreement.

8.4 [ ].

8.5 COMPAQ covenants not to sue VLSI, either directly or indirectly, under any
of its patents that relate to TECHNOLOGY. [ ].

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 7
9. Limitation of Liability

THE TECHNOLOGY CONTRIBUTION, GOODS AND SERVICES FURNISHED BY THE PARTIES IS
FURNISHED AS IS, WHERE IS, WITHOUT ANY WARRANTIES OF MERCHANTABILITY OR FITNESS
FOR USE AND ANY IMPLIED OR OTHER EXPRESS WARRANTIES ARE HEREBY EXPRESSLY
DISCLAIMED. EXCEPT AS EXPRESSLY PROVIDED IN SECTION 8 ABOVE, EACH OF THE
PARTIES AGREES THAT THE OTHER PARTY SHALL NOT BE LIABLE FOR ANY INDIRECT,
SPECIAL, OR CONSEQUENTIAL DAMAGES SUFFERED BY THAT PARTY WHETHER IN AN ACTION
OF CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE), OR OTHERWISE, EVEN IF THAT
PARTY IS ADVISED OF THE POSSIBILITY THAT SUCH DAMAGES HAVE BEEN, OR MAY BE
INCURRED. NEITHER PARTY'S LIABILITY HEREUNDER SHALL EXCEED THE AMOUNT OF MONIES
PAID OR PAYABLE HEREUNDER.

10. Audit Provisions

COMPAQ shall have the right, at its expense, to appoint a mutually acceptable
independent CPA to examine and audit, not more than once annually, VLSI's
records relating to royalty-bearing products. In the case that the result of
such audit determines that VLSI has underpaid its obligation by more than [ ],
then VLSI shall be liable for payment of the reasonable CPA fees for such
audit.

11. General

11.1 Neither party may assign its rights or obligations under this Agreement
without the prior consent of the other, and any purported assignment without
such consent shall have no force or effect, except that a party may assign this
Agreement once incident to the transfer of all or substantially all of its
business. Subject to the foregoing, this Agreement shall bind and inure to the
benefit of the respective parties hereto and their successors and assigns.

11.2 Neither party is authorized to act for or on the behalf of the other
party under this Agreement. Without limiting the generality of the foregoing,
each party is an independent contractor, and no principal/agent or partnership
relationship is created between them by this Agreement.

11.3 No failure or delay by either party to enforce or take advantage of any
provision or right under this Agreement shall constitute a subsequent waiver of
that provision or right, nor shall it be deemed to be a waiver of any of the
other terms and conditions of this Agreement.

11.4 Neither party to this Agreement shall be liable for its failure to
perform any of its obligations hereunder during any period in which such
performance is prevented by any cause beyond its reasonable control. In the
event of any such delay, the date of delivery or performance hereunder shall be
extended by a period equal to the time lost by reason of such delay.

11.5 The validity, performance and construction of this Agreement shall be
governed by the laws of the Texas, USA (excluding its conflict of laws
provisions).

11.6 The prevailing party in any legal action arising out of, or related to
this Agreement shall be entitled, in addition to any other rights and remedies
it may have, to reimbursement for its expenses incurred in such action,
including court costs and reasonable attorneys' fees.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 8
11.7 Unless otherwise stated herein, amounts stated as payable under this
Agreement include customs duties or sales, use, excise or other similar taxes
payable hereunder, which may be payable by VLSI.

11.8 Data and products provided hereunder may not be exported from the United
States, or re-exported from any other country, except in compliance with United
States Export Control Laws, and the parties agree to operate in full compliance
with these, and all other applicable laws.

11.9 All notices or communications to be given under this Agreement shall be in
writing and shall be deemed delivered upon hand delivery, upon acknowledged
telex or facsimile communication, or [ ] after deposit in the United
States mail, postage prepaid, by certified, registered or first class mail,
addressed to the parties at their addresses set forth above.

11.10 VLSI may announce, disclose and advertise COMPAQ's TECHNOLOGY
contributions to LICENSED PRODUCTS.

11.11 In the event that any provision of this Agreement is prohibited by any
law governing its construction, performance or enforcement, such provision
shall be ineffective to the extent of such prohibition without invalidating
thereby any of the remaining provisions of the Agreement. The captions of
sections herein are intended for convenience only, and the same shall not be
interpretive of the content of such section.

11.12 The terms and conditions of this Agreement may not be superseded,
modified, or amended except in writing that states that it is such a
modification, and is signed by an authorized representative of each party
hereto.

11.13 This Agreement, including exhibits, constitutes the entire
Agreement between the parties as to the subject matter hereof, and supersedes
and replaces all prior or contemporaneous agreements, written or oral, regarding
such subject matter, and shall take precedence over any additional or
conflicting terms that may be contained in either party's purchase orders or
order acknowledgement forms.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorized representatives, as of the day and year written
above.

COMPAQ COMPUTER CORPORATION VLSI TECHNOLOGY, INC.

BY: /s/ Jim Hartzog BY: /s/ Henry Potts
Senior Vice President Vice President and
and General Manager, General Manager,
PC Division Portable Systems Division

DATE: 9/15/93 DATE: 9/15/93

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 9
Exhibit A
Specification References

<TABLE>
<CAPTION>
Type of
Estimated Information Provided Specification or
TECHNOLOGY Gate Equivalents by COMPAQ Reference Document

<S> <C> <C> <C>
- ----------------------------------------------------------------------------------
[ ] [ ] [ ] [ ]
- ----------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------
[ ] [ ] [ ] [ ]
- ----------------------------------------------------------------------------------

- ----------------------------------------------------------------------------------
[ ] [ ] [ ] [ ]
- ----------------------------------------------------------------------------------
</TABLE>

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 10
Exhibit B
Statement of Work

<TABLE>
<CAPTION>
Agreed Completion
Design Activity Responsible Party Completion Sign-off/Reference
or Milestone VLSI COMPAQ Joint Date Documents

- ----------------------------------------------------------------------------------------
<S> <C> <C> <C>
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------

</TABLE>
[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 1
Exhibit 10.62
VLSI Confidential

QUADNOTE(TM) Chipset Cooperation Agreement

This Agreement is entered into on 15th day of September 1993 (hereafter the
"Effective Date") by and between Compaq Computer Corporation, a Delaware
Corporation with a principal place of business at 20555 S.H. 249, Houston, Texas
77070 (hereafter referred to as "COMPAQ") and VLSI Technology, Inc., a Delaware
Corporation with a principal place of business at 1109 McKay Drive, San Jose,
California 95131 (hereafter referred to as "VLSI").

WHEREAS, VLSI designs, develops, and sells integrated circuits designed for the
portable computer market; and

WHEREAS, COMPAQ designs, manufactures, and sells personal computer products and
systems; and

WHEREAS, COMPAQ and VLSI wish to cooperate in the specification, testing,
debugging and validation of certain VLSI integrated circuits designed for the
portable computer market; and

WHEREAS, VLSI desires to sell integrated circuits to COMPAQ for use in COMPAQ's
OEM systems, and COMPAQ desires to buy integrated circuits from VLSI.

NOW THEREFORE, in consideration of the foregoing and of the mutual covenants
and agreements hereinafter set forth, COMPAQ and VLSI agree as follows:

1. DEFINITIONS

1.1. "DERIVATIVE WORK" means a work that is a modification, enhancement, or
update of essentially the same architecture and functional features of CHIPSET,
which may contain enhancements and improvements, and has a material effect on
the physical or functional interchangeability or functional performance relative
to the CHIPSET SPECIFICATION.

1.2. "REVISION" means any subsequent version or release of the CHIPSET that
differs from the CHIPSET SPECIFICATION, or the specifications for the latest
prior REVISION, and that (a) may contain limited new features (including, but
not limited to, limited new functions and/or performance improvements over the
latest prior version), or (b) incorporates all corrections and fix releases
from the latest prior REVISION; but does not materially affect the physical or
functional interchangeability or functional performance of the CHIPSET.

1.3. "SPECIFICATION" means the design, functional and architectural definition
for CHIPSET, which shall be documented in a written technical specification set
forth in Exhibit A, CHIPSET SPECIFICATION.

1.4. "CHIPSET" means the QUADNOTE(TM) VLSI core logic integrated circuit design
that meets the SPECIFICATION, to be marketed under one or more VLSI trademarks,
as specifically set out in Exhibit A, CHIPSET SPECIFICATION.

<PAGE> 2
2. SCOPE

This Agreement covers the joint development efforts to specify, debug, test and
validate the CHIPSET in conformance with the parameters set forth in Exhibit A,
CHIPSET SPECIFICATION, and Exhibit B, STATEMENT OF WORK, which are incorporated
hereto by reference. Except where specifically expressed, this Agreement does
not pertain to any DERIVATIVE WORK OF CHIPSET, or other VLSI integrated
circuits.

3. COMPAQ's OBLIGATIONS

3.1. COMPAQ agrees to assist VLSI with the architectural definition for
CHIPSET, to be documented in the SPECIFICATION. At VLSI's request, and within
ten (10) business days of VLSI's request, COMPAQ agrees to meet with VLSI
representatives and provide its input to VLSI on a SPECIFICATION and any other
similar technical documents that VLSI has prepared. The foregoing meetings will
be held in Houston, Texas unless other arrangements are approved in advance by
COMPAQ.

3.2. COMPAQ further agrees to schedule telephonic meetings and conference
calls with VLSI within [ ] of VLSI's request to discuss COMPAQ's
comments and/or input to the SPECIFICATION.

3.3. COMPAQ agrees to furnish the deliverables set forth in Exhibit B,
STATEMENT OF WORK per the schedule set forth in Exhibit B.

3.4. COMPAQ agrees to review each revision of the SPECIFICATION and either
approve the SPECIFICATION, or provide VLSI with its detailed and substantive
comments within [ ] following its submittal by VLSI.

3.5. COMPAQ agrees to assist VLSI with the testing, debugging, and validation
of the specified functionality and PC compatibility of the CHIPSET. Testing
shall be performed to verify compliance with the agreed to SPECIFICATION and to
verify functional system operation and compatibility.

4. VLSI's OBLIGATIONS

4.1. VLSI agrees to use reasonable efforts to provide COMPAQ with CHIPSET
samples conforming to the SPECIFICATION in accordance with the schedule in
Exhibit B. [ ] samples shall be furnished at no cost to COMPAQ.

4.2. VLSI agrees to furnish the CHIPSET deliverables set forth in Exhibit B,
per the schedule set forth in Exhibit B.

4.3. VLSI will provide COMPAQ with a system validation platform simultaneously
with the CHIPSET samples. The system validation platform shall be used by
COMPAQ to test, debug, and validate the functionality and compatibility of the
CHIPSET samples. Functionality and compatibility shall be validated based on
the jointly developed SPECIFICATION and based on X86 personal computer
functional system operation and compatibility. Such system validation platform
shall be furnished at no cost to COMPAQ.

4.4. VLSI agrees to assist COMPAQ with validation of the specified
functionality and PC compatibility of the CHIPSET samples. Testing shall be
performed to verify compliance with the agreed to SPECIFICATION in accordance
with Exhibit B and to verify functional system operation and compatibility.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 3

4.5. Contingent upon VLSI's receipt and acceptance of COMPAQ's purchase order
prior to the date VLSI begins prototype fabrication, VLSI will use its
reasonable efforts to produce up to [ ] production devices ("INITIAL
PRODUCTION DEVICES") within [ ] after validation and approval of
CHIPSET samples by COMPAQ. Contingent upon VLSI's receipt and acceptance of
COMPAQ's purchase order prior to the date VLSI begins prototype fabrication,
VLSI will use its reasonable efforts to produce a reasonable additional
quantity of CHIPSET under terms of a "risk buy" alternative, thereby permitting
COMPAQ to order additional risk-production level CHIPSET within a similar time
frame. A "risk buy" shall mean a non-cancelable, non-reschedulable purchase
order from COMPAQ under which devices delivered by VLSI are not warranted to
meet the SPECIFICATION, and the risk thereof would be borne by COMPAQ.

5. ROYALTY

In consideration for COMPAQ's efforts as specified herein, and in further
consideration of COMPAQ's efforts to promote VLSI's CHIPSET in the development
of a commercial market of third parties for products using VLSI's CHIPSET, VLSI
will pay to COMPAQ a third party royalty based solely on the revenue received
by VLSI from the sales of CHIPSET product to third parties ("PRODUCT SUPPORT
ROYALTY"), as provided in Exhibit C, PRODUCT SUPPORT ROYALTY CALCULATION.

6. LIMITED EXCLUSIVITY

COMPAQ will have certain rights of exclusivity to the VLSI CHIPSET, as
specified in Exhibit D, LIMITED EXCLUSIVITY PROVISIONS.

7. PRICING AND AVAILABILITY OF CHIPSETS

7.1 The following unit pricing method shall apply to purchase orders for VLSI
CHIPSET that are purchased directly from VLSI by COMPAQ for use in COMPAQ OEM
systems. COMPAQ will be offered CHIPSET at a price that is:

7.1.1 For CHIPSETs ordered for delivery during the first [ ]
of production after the expiration of the final LIMITED EXCLUSIVITY PERIOD,
COMPAQ will be offered CHIPSET at a unit price that is [ ] that is
then currently offered to any other customer for delivery during the same time
period; and

7.1.2 For CHIPSETs ordered for delivery during the period subsequent
to the first [ ] of production after the expiration of the final
LIMITED EXCLUSIVITY PERIOD, and prior to one year after the expiration of the
final LIMITED EXCLUSIVITY PERIOD, COMPAQ will be offered CHIPSET at a unit
price that is [ ] that is then currently offered to any other
customer for delivery during the same time period; and

7.1.3 Thereafter, COMPAQ will be offered CHIPSET at a unit price that
is [ ] which is then currently offered to any other customer for
delivery during the same time period.

7.2 COMPAQ agrees to place and maintain a purchase order for [ ] to
be ordered for delivery during the first [ ] following the shipment

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 4
of INITIAL PRODUCTION DEVICES to COMPAQ of the CHIPSET, (hereafter referred to
as "MINIMUM PURCHASE COMMITMENT").

7.3 In the event that COMPAQ fails to place and maintain orders for its
MINIMUM PURCHASE COMMITMENT, COMPAQ agrees that the provisions of Section 5,
ROYALTY, Section 6., LIMITED EXCLUSIVITY, and Section 7, PRICING AND
AVAILABILITY OF CHIPSETS shall be void, and that VLSI shall be free to offer
the CHIPSET to its other customers without restrictions.

8. TRADEMARKS

VLSI agrees to mark and sell the CHIPSET as a VLSI device.

9. CONFIDENTIALITY OF TECHNOLOGY

9.1 "Confidential Information" shall mean that information of either party
that is disclosed to the other party ("Recipient") by reason of the parties'
relationship hereunder, either directly or indirectly in any written or
recorded form, orally, or by drawings or inspection of parts or equipment, and,
either in writing and marked as confidential or proprietary, or if oral,
reduced to writing similarly marked within [ ] of disclosure.

9.2 Recipient shall receive and use the Confidential Information only for
performance of Recipient's obligations hereunder, and will not use Confidential
Information for any other purpose, and shall not disclose such Confidential
Information to any person or persons who do not need to have knowledge of such
Confidential Information in the course of their employment.

9.3 Recipient further agrees that except as authorized by the Export
Administration Regulations of the U.S. Department of Commerce it will not
transmit, directly or indirectly, any "technical data" acquired from the other
party hereto, to Afghanistan, the People's Republic of China or any "Q, S, W, Y
or Z" country as those terms are defined in the Regulations.

9.4 It is expressly understood that Recipient shall not be liable for
disclosure of any Confidential Information if the same:

9.4.1 was in the public domain at the time it was disclosed;
9.4.2 was known to Recipient at the time of disclosure;
9.4.3 is disclosed with the prior written approval of the other
party hereto;
9.4.4 is disclosed after [ ] from the date of disclosure;
9.4.5 was independently developed by Recipient; or
9.4.6 becomes known to Recipient, on a non-confidential basis,
from a source other than the other party hereto, without breach
of this Agreement by Recipient.

9.5 The parties agree that any Confidential Information provided by the other
party will be safeguarded by the receiving party using procedures similar to
those used by the receiving party for its own Confidential Information. Neither
party shall be liable for accidental disclosure, or the unauthorized actions or
misconduct of its employees with regard to any Information embodied in their
respective products at the request of the other party.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 5
10. PROPRIETARY RIGHTS IN TECHNOLOGY

10.1 Each party will own those inventions, and any resulting patents, made by
its employees during the joint development of CHIPSET. Each party has the sole
right to determine what patents, if any, will be obtained on its employees'
inventions. Each party will bear its own patent filing expenses with respect to
inventions solely owned by it. Any invention jointly made by employees of both
parties will be jointly owned by both parties with each party exercising an
undivided ownership interest without any obligation to account to the other
for its use and or disposition. With respect to jointly owned inventions, the
parties will agree, on a case-by-case basis, which party will file patent
applications, if any. The parties will share equally the reasonable cost of
mutually agreed upon U.S. and foreign patent and mask work application filings,
prosecution, issuance, maintenance and the like for jointly owned inventions.
If one party desires to file, prosecute or maintain a patent application or
patent on a joint invention and the other party, on reasonable notification, is
unwilling to share in the expense of doing so, then the one party may proceed
at its own expense and the other party shall forfeit its undivided, one-half
ownership interest, but shall obtain a license in accordance with the Section
hereof pertaining to license grants. Each party will have the right
independently to license its patent rights resulting from this joint
development.

10.2 VLSI Proprietary Rights. Except as provided in Section 10.3(b) and Section
10.3(d), VLSI shall retain sole title and ownership (including, but not
limited, to all patent, copyright, trademark, service mark, trade secret, or
other intellectual or industrial property rights) in and to all intellectual
property created by VLSI, or in which VLSI has title or ownership by contract,
to (a) the CHIPSET and all DERIVATIVE WORKS thereto developed by VLSI (but
excluding those unique portions of the DERIVATIVE WORKS incorporating COMPAQ
proprietary technology), (b) all designs, drawings, schematics, logic diagrams,
diagnostics, mask works, specifications, documentation, and other technical
data and knowhow relating to or produced by VLSI in connection with the
development or subsequent licensing or sale of the Products, and (c) all other
VLSI products, including, but not limited to, the CHIPSET.

10.3 COMPAQ Proprietary Rights. COMPAQ shall retain sole title and ownership
(including, but not limited to, all patent, copyright, trademark, service mark,
trade secret or other intellectual or industrial property rights) in and to all
intellectual property created by COMPAQ, or in which COMPAQ has title or
ownership by contract, to (a) the COMPAQ Products (not including the CHIPSET
itself) and all modifications, enhancements, updates, revisions, translations,
compilations, and derivatives thereto developed by COMPAQ, (b) all designs,
drawings, schematics, logic diagrams, diagnostics, mask works, specifications,
documentation, and other technical data and know-how relating to the COMPAQ
Products delivered by COMPAQ to VLSI hereunder to enable VLSI to design and
develop the CHIPSET pursuant to this Agreement, (c) all other COMPAQ products,
and (d) products or materials developed by COMPAQ using the CHIPSET as tools in
the manner contemplated by this Agreement, other than derivative works that
constitute embellishments, improvements, or other modifications to the CHIPSET
themselves intended for use as such.

10.4 COMPAQ's intellectual property rights regarding QUADNOTE are covered in
the Technology Agreement with an Effective Date of September 15, 1993.

10.5 Notwithstanding the above, COMPAQ obtains no rights or licenses with
respect to any intellectual property that may be contained in the CHIPSET.

<PAGE> 6
11. INDEMNITY

11.1 COMPAQ shall defend or settle at its option and expense any claim or
action brought against VLSI, alleging that the Information furnished by COMPAQ
under this Agreement infringes a patent, copyright, or trade secret of another,
and COMPAQ shall pay any costs, including attorneys fees and damages awarded
against VLSI, that are attributable to such claim or action, provided that VLSI
notifies COMPAQ promptly in writing of the action, and authorizes COMPAQ to
defend or settle the same claim or action.

11.2 If a final injunction is issued against VLSI's use of the COMPAQ
information in accordance with the licenses in this Agreement, COMPAQ will at
its option and expense either (i) replace or modify the information so that it
becomes noninfringing, (ii) procure for VLSI the right to continue using the
information, or (iii) in the event that the information cannot be modified or
the necessary right obtained under reasonable terms, then the parties shall
negotiate in good faith to reach a settlement regarding the damages to VLSI,
[ ].

11.3 The parties may mutually agree in advance that VLSI may defend or settle
action brought against VLSI or its customers alleging that the information
furnished by COMPAQ infringes a patent, copyright, or trade secret of another.
In such a case, COMPAQ will reimburse VLSI for its expenses to procure, replace
or modify the information, including any attorneys fees and damages awarded
against VLSI.

[11.4 ].

11.5 COMPAQ covenants not to sue VLSI, either directly or indirectly, under any
of its patents that relate to CHIPSET. [ ].

11.6 EXCEPT AS EXPRESSLY PROVIDED ABOVE, THE TECHNOLOGY CONTRIBUTION, GOODS AND
SERVICES FURNISHED BY THE PARTIES IS FURNISHED AS IS, WHERE IS, WITHOUT ANY
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR USE AND ANY IMPLIED OR OTHER
EXPRESS WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED. EXCEPT FOR BREACH OF
SECTION 11.1, EACH OF THE PARTIES AGREES THAT THE OTHER PARTY SHALL NOT BE
LIABLE FOR ANY INDIRECT, SPECIAL, OR CONSEQUENTIAL DAMAGES SUFFERED BY THAT
PARTY WHETHER IN AN ACTION OF CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE),
OR OTHERWISE, EVEN IF THAT PARTY IS ADVISED OF THE POSSIBILITY THAT SUCH
DAMAGES HAVE BEEN, OR MAY BE INCURRED. NEITHER PARTY'S LIABILITY HEREUNDER
SHALL EXCEED THE AMOUNT OF MONIES PAID OR PAYABLE HEREUNDER.

12. AUDIT PROVISIONS

COMPAQ shall have the right, at its expense, to appoint a mutually agreeable
independent CPA to examine and audit, not more than once annualy, VLSI's
records relating to royalty-bearing products. If the final result of such audit
determines that VLSI has underpaid its obligation by more than [ ], then
VLSI shall be liable for payment of the reasonable CPA fees for such audit.

13. ADDITIONAL WARRANTIES AND REPRESENTATIONS

13.1 Each of the parties represents and warrants that it is duly authorized to
enter into this Agreement.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 7
13.2 COMPAQ further warrants that with respect to the information provided by
COMPAQ under this Agreement, it has no current knowledge of any infringement of
intellectual property rights and has not received notice of any such
infringement.

13.3 Except as otherwise expressly stated, there are no other warranties,
express or implied.

14. TERM DEFAULT AND TERMINATION

14.1 This Agreement shall remain in effect during the period in which
royalties are to be paid by VLSI to COMPAQ, and for an additional period of
[ ] after the final royalty payment under this Agreement. The Agreement
may be extended by mutual written consent of the parties, prior to the end of
the term of the Agreement.

14.2 The Agreement may be terminated by either party upon a material breach of
the Agreement by the other party. Failure to comply with any of the material
obligations of this Agreement shall be deemed to be material breaches. Prior to
such a termination, the non-breaching party shall give the other party [
] notice. If the breaching party does not cure the breach, or provide
a schedule to cure the breach to the other party's satisfaction within that
period, the Agreement may be terminated by the non-breaching party.

14.3 Either party may terminate this Agreement if the other becomes the
subject of a voluntary or involuntary petition in bankruptcy or any proceeding
relating to insolvency, receivership, liquidation or composition for the
benefit of creditors if that petition or proceeding is not dismissed with
prejudice within [ ] after filing.

14.4 At the termination or expiration of this Agreement, VLSI will continue to
have the right to manufacture, market and sell any products covered by this
Agreement. Sections 8 through 10, 11.5, and 11.6 of this Agreement shall
survive termination for any reason. Sections 11.1 through 11.4, of this
Agreement shall survive termination for any reason only with respect to
products sold prior to the termination of this Agreement.

14.5 Termination or expiration of this Agreement shall have no effect on any
other agreement between the parties.

15. MISCELLANEOUS

15.1 Neither party to this Agreement shall be liable for its failure to
perform any of its obligations hereunder during any period in which such
performance is prevented by any cause beyond this reasonable control.

15.2 The validity, performance and construction of this Agreement shall be
governed by the laws of the State of California, USA (excluding its conflict of
laws provisions).

15.3 Each party shall adhere to the U.S. Export Administration Laws and
Regulations and shall not export nor re-export any technical data nor products
received from the other party or product produced from such technical data to
any proscribed country listed in the U.S. Export Administration Regulations,
unless properly authorized by the U.S. Government.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 8
15.4 Every notice or writing required or permitted under this Agreement shall
be signed by an authorized representative of the party initiating such notice
or writing and shall be delivered personally or sent by certified mail, return
receipt requested, postage prepaid; overnight mail or delivery; or telefax; to
the following addresses, unless modified by written notice of the party in
question:

FOR COMPAQ:

COMPAQ Computer Corporation
20555 S.H. 249
P.O. Box 692000
Houston, Texas 77269-2000
Telefax: 713-374-8332
Attn: Legal Department M060803

FOR VLSI:

VLSI Technology, Inc.
1109 McKay Drive
San Jose, California 95131
Attn: Legal Department

With a copy to:

VLSI Technology, Inc.
8375 South River Parkway
Tempe, Arizona 85284
Attn: Vice President, Portable Systems Division

15.5 Neither party hereto will have, or will represent that it has, any power,
right, or authority to bind the other party hereto, or to assume or create any
obligation, express or implied, on behalf of or in such other party's name.

15.6 In the event any litigation is brought by either party in connection with
this Agreement, the prevailing party in such litigation shall be entitled to
recover from the other party its attorneys' fees and other costs incurred in
connection with this litigation.

15.8 If any part of this Agreement is found by a court of law to be invalid or
illegal, then only that portion shall be null, and the remainder of the
Agreement shall continue in full force and effect.

15.9 VLSI may announce, disclose and advertise COMPAQ's contributions to
CHIPSET and the use of CHIPSET in COMPAQ products subsequent to COMPAC's
announcement of such products.

15.10 Unless otherwise stated herein, amounts stated as payable under this
Agreement include customs duties or sales, use, excise or other similar taxes
payable hereunder, which may be payable by VLSI.

<PAGE> 9
15.11 The terms and conditions of this Agreement may not be superseded,
modified, or amended except in writing that states that it is such a
modification, and is signed by an authorized representative of each party
hereto.

15.12 Neither party may assign its rights or obligations under this Agreement
without the prior consent of the other, and any purported assignment without
such consent shall have no force or effect, except that a party may assign this
Agreement incident to the transfer of all or substantially all of its business,
or substantially all of the business of the affected division. Subject to the
foregoing, this Agreement shall bind and inure to the benefit of the respective
parties hereto and their successors and assigns.

15.13 No failure or delay by either party to enforce or take advantage of any
provision or right under this Agreement shall constitute a subsequent waiver of
that provision or right, nor shall it be deemed to be a waiver of any of the
other terms and conditions of this Agreement.

15.14 This Agreement constitutes the complete and exclusive statement of the
agreement between the parties concerning the particular subject matter
contained herein and supersedes all prior understandings, communications,
representations and promises. No waiver, modification, or amendment shall be
binding upon either party unless in writing and signed for the parties through
their duly authorized representatives.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorized representatives, as of the day and year written
above.

COMPAQ COMPUTER CORPORATION VLSI TECHNOLOGY, INC.

BY: /s/Jim Hartzog BY: /s/Henry Potts
Senior Vice President Vice President and
and General Manager, General Manager,
PC Division Portable Systems Division

DATE: 9/15/93 DATE: 9/15/93

<PAGE> 10
Exhibit A
CHIPSET SPECIFICATION

CHIPSET Description. This specification is a core logic integrated circuit
design, consisting of two integrated circuits (a system controller and a
peripheral combo controller), for the portable computer market, to be marketed
under the VLSI trademark QUADNOTE(TM), and hereafter referred to as
"QUADNOTE(TM) CHIPSET"

This specification will be developed under the performance of this agreement,
and will be incorporated herein upon completion of the first three tasks and
milestones in the STATEMENT OF WORK, Exhibit B.
<PAGE> 11
Exhibit B
STATEMENT OF WORK (including QUADNOTE(TM) CHIPSET Deliverables and Schedule)

<TABLE>
<CAPTION>
Agreed Completion
Design Activity Responsible Party Completion Sign-off/Reference
or Milestone VLSI COMPAQ Joint Date Documents

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 12
Exhibit B (continued)
STATEMENT OF WORK (including QUADNOTE(TM) CHIPSET Deliveries and Schedule)

<TABLE>
<CAPTION>
Completion
Design Activity Responsible Party Completion Sign-off/Reference
or Milestone VLSI COMPAQ Joint Date Documents

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 13
EXHIBIT C
PRODUCT SUPPORT ROYALTY CALCULATION

1. VLSI will pay to COMPAQ a PRODUCT SUPPORT ROYALTY in consideration for
COMPAQ's efforts in testing, debugging and validation and to promote VLSI's
CHIPSET for purchase by third parties ("PRODUCT SUPPORT ROYALTY"). This PRODUCT
SUPPORT ROYALTY will be payable for a period ending [ ] subsequent to
the shipment of INITIAL PRODUCTION DEVICES OF CHIPSET to third parties by VLSI
and for CHIPSET made by or for third parties under license by VLSI. PRODUCT
SUPPORT ROYALTY will be paid [ ] after the end of the [ ]
subsequent to the shipment of INITIAL PRODUCTION DEVICES of CHIPSET to third
parties, and [ ] after the end of the [ ] subsequent to the shipment
of INITIAL PRODUCTION DEVICES of CHIPSET to third parties.

2. The unit volume, shipments and revenues of SCAMP(TM) IV CHIPSET will be
combined with the unit volume, shipments and revenues of QUADNOTE(TM) CHIPSET
for purposes of PRODUCT SUPPORT ROYALTY calculation in both the SCAMP(TM) IV
Chipset Cooperation Agreement, and the QUADNOTE(TM) Chipset Cooperation
Agreement. VLSI will report to COMPAQ the total NET REVENUE and PRODUCT SUPPORT
ROYALTY RATE for CHIPSET sold to third parties by VLSI and for CHIPSET made by
or for third parties under license by VLSI [hereafter collectively referred to
as CHIPSET to Third Parties] and the total amount due to COMPAQ.

3. The royalty rate ("PRODUCT SUPPORT ROYALTY RATE") for the first shipment
year will be calculated at the end of the [ ] after the shipment of
INITIAL PRODUCTION DEVICES of CHIPSET to Third Parties. The PRODUCT SUPPORT
ROYALTY RATE will be calculated as the [ ] multiplied by the unit volume
of shipments of SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS to Third
Parties during the most recent [ ], up to a maximum PRODUCT SUPPORT
ROYALTY RATE OF [ ]. For example, if [ ] units of CHIPSET are sold
by VLSI to Third Parties during the [ ], then the PRODUCT SUPPORT
ROYALTY RATE will be [ ].

4. The PRODUCT SUPPORT ROYALTY RATE for the second shipment year will be
calculated at the end of the [ ] after the shipment of INITIAL
PRODUCTION DEVICES of CHIPSET to Third Parties. PRODUCT SUPPORT ROYALTY RATE
will be calculated as the [ ] multiplied by the unit volume of shipments
of SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS to Third Parties during the
most recent [ ], up to a maximum PRODUCT SUPPORT ROYALTY RATE of
[ ]. For example, if [ ] units of SCAMP(TM) IV CHIPSETS and
QUADNOTE(TM) CHIPSETS are sold by VLSI to Third Parties during the
[ ], then the PRODUCT SUPPORT ROYALTY RATE will be [ ].

5. NET REVENUE shall mean revenue received by VLSI for the sale of SCAMP(TM)
IV CHIPSETS and QUADNOTE(TM) CHIPSETS to all parties (including COMPAQ), less
any adjustments for returns, other royalties and license fees payable to
COMPAQ, packing and shipping, and deductions for product sold to distributors
with a right of return, divided by the total number of SCAMP(TM) IV CHIPSETS
and QUADNOTE(TM) CHIPSETS sold to all parties, multiplied by the number of
SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS sold to Third Parties.

6. The PRODUCT SUPPORT ROYALTY payable to COMPAQ for SCAMP(TM) IV CHIPSETS and
QUADNOTE(TM) CHIPSETS will be calculated by multiplying the PRODUCT SUPPORT
ROYALTY RATE by the NET REVENUE during the previous [ ]. This one

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 14
PRODUCT SUPPORT ROYALTY will satisfy the PRODUCT SUPPORT ROYALTY obligations
under both the SCAMP(TM) IV Chipset Cooperation Agreement and the QUADNOTE(TM)
Chipset Cooperation Agreement.

7. Under certain conditions defined below, the PRODUCT SUPPORT ROYALTY will be
payable over an extended period, and under certain conditions will be payable
on DERIVATIVE WORKS. If, during the period of [ ] subsequent to the
shipment of INITIAL PRODUCTION DEVICES of SCAMP(TM) IV CHIPSETS and
QUADNOTE(TM) CHIPSETS to COMPAQ:

A. VLSI has supplied to COMPAQ core logic chipsets (integrated circuits
with functions essentially similar to SCAMP(TM) IV CHIPSETS and QUADNOTE(TM)
CHIPSETS) for notebook and sub-notebook computer systems in a volume
[ ] of COMPAQ's total unit shipments of such computer systems
(as defined and as reported by either International Data Corporation, or
Dataquest, or such other commercial market data service in the event that
International Data Corporation and Dataquest cease to report such market data)
totaled over a consecutive period of [ ], and;

B. during each quarter in such consecutive period of [ ], COMPAQ
continues to sell greater than [ ] of the total worldwide market
sales of such computer systems (as defined and as reported by either
International Data Corporation, or Dataquest), and;

C. COMPAQ continues to use its reasonable efforts to indirectly develop
the market for VLSI's SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS through
marketing and promotion of COMPAQ's products using SCAMP(TM) IV CHIPSETS and
QUADNOTE(TM) CHIPSETS, including allowing VLSI to promote its relationship with
COMPAQ, and promote the use of SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS
by COMPAQ, then;

D. the period that the PRODUCT SUPPORT ROYALTY will be paid by VLSI to
COMPAQ will be extended by [ ] to a period ending [ ]
subsequent to the shipment of INITIAL PRODUCTION DEVICES OF QUADNOTE(TM)
CHIPSET, and in addition, all existing DERIVATIVE WORKS of QUADNOTE(TM) CHIPSET
will be royalty bearing under this agreement. In such case, the PRODUCT SUPPORT
ROYALTY will be paid [ ] subsequent to the previous payment by VLSI
of the PRODUCT SUPPORT ROYALTY. Notwithstanding this provision, this extension
may be shortened as set out in Paragraphs 8, 9, or 10 below.

8. If the PRODUCT SUPPORT ROYALTY period has been extended beyond
[ ], as described in Section 7, and, then, if VLSI has sold to COMPAQ
core logic chipsets (integrated circuits with functions essentially similar to
QUADNOTE(TM) CHIPSET) for notebook and sub-notebook computer systems in a
volume less than [ ] of COMPAQ's total unit shipments of such
computer systems (as defined and as reported by either International Data
Corporation, or Dataquest) during that VLSI [ ], then VLSI will
terminate further PRODUCT SUPPORT ROYALTY payments to COMPAQ effective the end
of the next subsequent VLSI [ ].

9. If the PRODUCT SUPPORT ROYALTY period has been extended beyond [ ],
as described in Section 7, and, then, if COMPAQ does not sell greater than
[ ] of the total worldwide market sales of notebook and sub-notebook
computer systems (as defined and as reported by either International Data
Corporation, or Dataquest) during that previous [ ], then VLSI will
terminate further PRODUCT SUPPORT ROYALTY payments to COMPAQ effective the end
of the next subsequent VLSI [ ].

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 15
10. If the PRODUCT SUPPORT ROYALTY period has been extended beyond [ ],
as described in Section 7, and any DERIVATIVE WORKS to SCAMP(TM) IV CHIPSETS
and QUADNOTE(TM) CHIPSETS were not developed under the terms of a subsequent
agreement between COMPAQ and VLSI, which would supersede the terms of this
Agreement with regard to CHIPSET DERIVATIVE WORKS, then VLSI may, at any time
after the end of the initial [ ] period, elect to pay any royalties that
are payable on that date, plus an additional and final payment of [ ],
and such payment will be considered full payment of all PRODUCT SUPPORT ROYALTY
obligations under this Agreement and the QUADNOTE CHIPSET Cooperation
Agreement.

11. The PRODUCT SUPPORT ROYALTY RATE after the second shipment year will be
calculated at the end of the [ ] subsequent to the payment of the PRODUCT
SUPPORT ROYALTY. PRODUCT SUPPORT ROYALTY RATE will be calculated as the
[ ] multiplied by the unit volume of shipments of SCAMP(TM) IV CHIPSETS
and QUADNOTE(TM) CHIPSETS to Third Parties during the most recent [ ],
up to a maximum PRODUCT SUPPORT ROYALTY RATE of [ ]. For example, if
[ ] units of SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS are sold by
VLSI to Third Parties during the [ ], then the PRODUCT SUPPORT ROYALTY
RATE will be [ ].

12. In the event that COMPAQ's ability to fulfill the requirements of Paragraph
7 of this Exhibit is materially and detrimentally affected because VLSI is
unable or unwilling to accept COMPAQ's firm orders under reasonable terms, for
a period that exceeds [ ], then COMPAQ's performance pursuant to
Paragraph 7 on this Exhibit will be excused, for so long as VLSI does not
accept such orders, and VLSI will continue to be obligated to pay the royalties
as set forth in Paragraph 7 of this Exhibit.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 16
EXHIBIT D
LIMITED EXCLUSIVITY PROVISIONS

1. The LIMITED EXCLUSIVITY PERIOD hereinafter ("LIMITED EXCLUSIVITY PERIOD")
SHALL BE [ ].

A. For the period of the LIMITED EXCLUSIVITY PERIOD, in advance of any
other VLSI customer, VLSI shall furnish COMPAQ with production revision
CHIPSETS, and COMPAQ shall be the sole customer that shall be entitled to
receive delivery for such revision CHIPSET for such LIMITED EXCLUSIVITY PERIOD.
Such LIMITED EXCLUSIVITY PERIOD shall begin when VLSI has delivered to COMPAQ
the INITIAL PRODUCTION DEVICES (as set forth in Section 4.5), but shall be
relinquished and waived by COMPAQ if such INITIAL PRODUCTION DEVICES are not
ordered by COMPAQ. The parties hereto intend for the foregoing provision to
provide COMPAQ an opportunity to exercise a head start advantage at the time
that production revision devices are available in production quantities equal to
the LIMITED EXCLUSIVITY PERIOD. In the event that VLSI is unable to deliver
COMPAQ's first delivery of up to [ ] of production orders for
CHIPSET subsequent to approval of CHIPSET by COMPAQ, within a lead-time of
[ ] after receipt of order, VLSI agrees to extend the LIMITED
EXCLUSIVITY PERIOD day to day until such delivery is made.

B. After the lapse of the final LIMITED EXCLUSIVITY PERIOD, VLSI agrees
to give COMPAQ's orders "most-favored customer" status (with respect to
availability and allocation) in the event that demand of the CHIPSET exceeds
supply.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 1
Exhibit 10.63

VLSI Confidential

SCAMP(TM) IV Chipset Cooperation Agreement

This Agreement is entered into on 15th day of September 1993 (hereafter the
"Effective Date") by and between Compaq Computer Corporation, a Delaware
Corporation with a principal place of business at 20555 S.H. 249, Houston,
Texas 77070 (hereafter referred to as "COMPAQ") and VLSI Technology, Inc., a
Delaware Corporation with a principal place of business at 1109 McKay Drive,
San Jose, California 95131 (hereafter referred to as "VLSI").

WHEREAS, VLSI designs, develops, and sells integrated circuits designed for the
portable computer market; and

WHEREAS, COMPAQ designs, manufactures, and sells personal computer products and
systems; and

WHEREAS, COMPAQ and VLSI wish to cooperate in the specification, testing,
debugging and validation of certain VLSI integrated circuits designed for the
portable computer market; and

WHEREAS, VLSI desires to sell integrated circuits to COMPAQ for use in COMPAQ's
OEM systems, and COMPAQ desires to buy integrated circuits from VLSI.

NOW THEREFORE, in consideration of the foregoing and of the mutual covenants
and agreements hereinafter set forth, COMPAQ and VLSI agree as follows:

DEFINITIONS

1.1 "DERIVATIVE WORK" means a work that is a modification, enhancement, or
update of essentially the same architecture and functional features of CHIPSET,
which may contain enhancements and improvements, and has a material effect on
the physical or functional interchangeability or functional performance relative
to the CHIPSET SPECIFICATION.

1.2 "REVISION" means any subsequent version or release of the CHIPSET that
differs from the CHIPSET SPECIFICATION, or the specifications for the latest
prior REVISION, and that (a) may contain limited new features (including, but
not limited to, limited new functions and/or performance improvements over the
latest prior version), or (b) incorporates all corrections and fix releases
from the latest prior REVISION; but does not materially affect the physical or
functional interchangeability or functional performance of the CHIPSET.

1.3 "SPECIFICATION" means the design, functional and architectural definition
for CHIPSET, which shall be documented in a written technical specification set
forth in Exhibit A, CHIPSET SPECIFICATION.

1.4 "CHIPSET" means the SCAMP(TM) IV VLSI core logic integrated circuit
design that meets the SPECIFICATION, to be marketed under one or more VLSI
trademarks, as specifically set out in Exhibit A, CHIPSET SPECIFICATION.

<PAGE> 2
2. SCOPE

3. COMPAQ'S OBLIGATIONS

3.2. COMPAQ further agrees to schedule telephonic meetings and conference calls
with VLSI within [ ] of VLSI's request to discuss COMPAQ's comments
and/or input to the SPECIFICATION.

3.3. COMPAQ agrees to furnish the deliverables set forth in Exhibit B,
STATEMENT OF WORK per the schedule set forth in Exhibit B.

4. VLSI's OBLIGATIONS

4.2. VLSI agrees to furnish the CHIPSET deliverables set forth in Exhibit B,
per the schedule set forth in Exhibit B.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 3
4.5 Contingent upon VLSI's receipt and acceptance of COMPAQ's purchase order
prior to the date VLSI begins prototype fabrication, VLSI will use its
reasonable efforts to produce up to [ ] production devices
("INITIAL PRODUCTION DEVICES") within [ ] after validation and
approval of CHIPSET samples by COMPAQ. Contingent upon VLSI's receipt and
acceptance of COMPAQ's purchase order prior to the date VLSI begins prototype
fabrication, VLSI will use its reasonable efforts to produce a reasonable
additional quantity of CHIPSET under terms of a "risk buy" alternative, thereby
permitting COMPAQ to order additional risk-production level CHIPSET within a
similar time frame. A "risk buy" shall mean a non-cancelable, non-reschedulable
purchase order from COMPAQ under which devices delivered by VLSI are not
warranted to meet the SPECIFICATION, and the risk thereof would be borne by
COMPAQ.

5. ROYALTY

6. LIMITED EXCLUSIVITY

COMPAQ will have certain rights of exclusivity to the VLSI CHIPSET, as
specified in Exhibit D, LIMITED EXCLUSIVITY PROVISIONS.

7. PRICING AND AVAILABILITY OF CHIPSETS

7.1 The following unit pricing method shall apply to purchase orders for VLSI
CHIPSET that are purchased directly from VLSI by COMPAQ for use in COMPAQ OEM
systems, COMPAQ will be offered CHIPSET at a price that is:

7.1.1 For CHIPSETs ordered for delivery during the first [ ]
of production after the expiration of the final LIMITED EXCLUSIVITY PERIOD,
COMPAQ will be offered CHIPSET at a unit price that is [
] that is then currently offered to any other customer
for delivery during the same time period; and

7.1.2 For CHIPSETs ordered for delivery during the period subsequent to
the first [ ] of production after the expiration of the final
LIMITED EXCLUSIVITY PERIOD, and prior to one year after the expiration of the
final LIMITED EXCLUSIVITY PERIOD, COMPAQ will be offered CHIPSET at a unit
price that is [ ] that is then currently offered
to any other customer for delivery during the same time period; and

7.1.3 Thereafter, COMPAQ will be offered CHIPSET at a unit price that is
[ ] which is then currently offered to any other customer for
delivery during the same time period.

7.2 COMPAQ agrees to place and maintain a purchase order for [ ] to
be ordered for delivery during the first [ ] following the shipment

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 4
of INITIAL PRODUCTION DEVICES to COMPAQ of the CHIPSET, (hereafter referred to
as "MINIMUM PURCHASE COMMITMENT").

7.3. in the event that COMPAQ fails to place and maintain orders for its MINIMUM
PURCHASE COMMITMENT, COMPAQ agrees that the provisions of Section 5, ROYALTY,
Section 6, LIMITED EXCLUSIVITY, and Section 7, PRICING AND AVAILABILITY OF
CHIPSETS shall be void, and that VLSI shall be free to offer the CHIPSET to its
other customers without restrictions.

8. TRADEMARKS

VLSI agrees to mark and sell the CHIPSET as a VLSI device.

9. CONFIDENTIALITY OF TECHNOLOGY

9.1 "Confidential Information" shall mean that information of either party that
is disclosed to the other party ("Recipient") by reason of the parties'
relationship hereunder, either directly or indirectly in any written or
recorded form, orally, or by drawings or inspection of parts or equipment, and,
either in writing and marked as confidential or proprietary, or if oral,
reduced to writing similarly marked within [ ] of disclosure.

9.3 Recipient further agrees that except as authorized by the Export
Administration Regulations of the U. S. Department of Commerce it will not
transmit, directly or indirectly, any "technical data" acquired from the other
party hereto, to Afghanistan, the People's Republic of China or any "Q, S, W, Y
or Z" country as those terms are defined in the Regulations.

9.4 It is expressly understood that Recipient shall not be liable for
disclosure of any Confidential Information if the same:

9.4.1 was in the public domain at the time it was disclosed;
9.4.2 was known to Recipient at the time of disclosure;
9.4.3 is disclosed with the prior written approval of the other
party hereto;
9.4.4 is disclosed after [ ] from the date of disclosure;
9.4.5 was independently developed by Recipient;
9.4.6 or becomes known to Recipient, on a non-confidential basis,
from a source other than the other party hereto, without breach
of this Agreement by Recipient.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 5
10. PROPRIETARY RIGHTS IN TECHNOLOGY

10.1 Each party will own those inventions, and any resulting patents, made by
its employees during the joint development of CHIPSET. Each party has the sole
right to determine what patents, if any, will be obtained on its employees'
inventions. Each party will bear its own patent filing expenses with respect to
inventions solely owned by it. Any invention jointly made by employees of both
parties will be jointly owned by both parties with each party exercising an
undivided ownership interest without any obligation to account to the other for
its use and or disposition. With respect to jointly owned inventions, the
parties will agree on a case-by-case basis, which party will file patent
applicaitons, if any. The parties will share equally the reasonable cost of
mutually agreed upon U.S. and foreign patent and mask work application filings,
prosecution, issuance, maintenance and the like for jointly owned inventions.
If one party desires to file, prosecute or maintain a patent application or
patent on a joint invention and the other party, on reasonable notification, is
unwilling to share in the expense of doing so, then the one party may proceed
at its own expense and the other party shall forfeit its undivided, one-half
ownership interest, but shall obtain a license in accordance with the Section
hereof pertaining to license grants. Each party will have the right
independently to license its patent rights resulting from this joint
development.

10.2 VLSI Proprietary Rights. Except as provided in Section 10.3(b) and
Section 10.3(d), VLSI shall retain sole title and ownership (including, but not
limited to, all patent, copyright, trademark, service mark, trade secret, or
other intellectual or industrial property rights) in and to all intellectual
property created by VLSI, or in which VLSI has title or ownership by contract,
to (a) the CHIPSET and all DERIVATIVE WORKS thereto developed by VLSI (but
excluding those unique portions of the DERIVATIVE WORKS incorporating COMPAQ
proprietary technology), (b) all designs, drawings, schematics, logic diagrams,
diagnostics, mask works, specifications, documentation, and other technical data
and knowhow relating to or produced by VLSI in connection with the development
or subsequent licensing or sale of the Products, and (c) all other VLSI
products, including, but not limited to, the CHIPSET.

10.4 COMPAQ's intellectual property rights regarding SCAMP IV are covered in
the Technology Agreement with an Effective Date of September 15, 1993.

<PAGE> 6
10.5 Notwithstanding the above, COMPAQ obtains no rights or licenses with
respect to any intellectual property that may be contained in the CHIPSET.

11. INDEMNITY

11.1 COMPAQ shall defend or settle at its option and expense any claim or
action brought against VLSI, alleging that the information furnished by COMPAQ
under this agreement infringes a patent, copyright, or trade secret of another,
and COMPAQ shall pay any costs, including attorneys fees and damages awarded
against VLSI, that are attributable to such claim or action, provided that VLSI
notifies COMPAQ promptly in writing of the action, and authorizes COMPAQ to
defend or settle the same claim or action.

11.4 [ ].

11.5 COMPAQ covenants not to sue VLSI, either directly or indirectly, under any
of its patents that relate to CHIPSET. [ ].

11.6 EXCEPT AS EXPRESSLY PROVIDED ABOVE, THE TECHNOLOGY CONTRIBUTION, GOODS
AND SERVICES FURNISHED BY THE PARTIES IS FURNISHED AS IS, WHERE IS, WITHOUT ANY
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR USE AND ANY IMPLIED OR OTHER
EXPRESS WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED. EXCEPT FOR BREACH OF
SECTION 11.1, EACH OF THE PARTIES AGREES THAT THE OTHER PARTY SHALL NOT BE
LIABLE FOR ANY INDIRECT, SPECIAL, OR CONSEQUENTIAL DAMAGES SUFFERED BY THAT
PARTY WHETHER IN AN ACTION OF CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE),
OR OTHERWISE, EVEN IF THAT PARTY IS ADVISED OF THE POSSIBILITY THAT SUCH
DAMAGES HAVE BEEN, OR MAY BE INCURRED. NEITHER PARTY'S LIABILITY HEREUNDER
SHALL EXCEED THE AMOUNT OF MONIES PAID OR PAYABLE HEREUNDER.

12. AUDIT PROVISIONS

COMPAQ shall have the right, at its expense, to appoint a mutually agreeable
independent CPA to examine and audit, not more than once annually, VLSI's
records relating to royalty-bearing products. If the final result of such
audit determines that VLSI has underpaid its obligation by more than [ ],
then VLSI shall be liable for payment of the reasonable CPA fees for such audit.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 7
13. ADDITIONAL WARRANTIES AND REPRESENTATIONS

13.1 Each of the parties represents and warrants that it is duly authorized to
enter into this Agreement.

13.2 COMPAQ further warrants that with respect to the information provided by
COMPAQ under this Agreement, it has no current knowledge of any infringement of
intellectual property rights and has not received notice of any such
infringement.

13.3 Except as otherwise expressly stated, there are no other warranties,
express or implied.

14. TERM DEFAULT AND TERMINATION

14.1 This Agreement shall remain in effect during the period in which
royalties are to be paid by VLSI to COMPAQ, and for an additional period of
[ ] after the final royalty payment under this Agreement. The
Agreement may be extended by mutual written consent of the parties, prior
to the end of the term of the Agreement.

14.2 The Agreement may be terminated by either party upon a material breach of
the Agreement by the other party. Failure to comply with any of the material
obligations of this Agreement shall be deemed to be material breaches. Prior to
such a termination, the non-breaching party shall give the other party
[ ] notice. If the breaching party does not cure the breach, or
provide a schedule to cure the breach to the other party's satisfaction within
that period, the Agreement may be terminated by the non-breaching party.

14.5 Termination or expiration of this Agreement shall have no effect on any
other agreement between the parties.

15. MISCELLANEOUS

15.2 The validity, performance and construction of this Agreement shall be
governed by the laws of the State of California, USA (excluding its conflict of
laws provisions).

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 8
15.3 Each party shall adhere to the U.S. Export Administration Laws and
Regulations and shall not export nor re-export any technical data nor products
received from the other party or product produced from such technical data to
any proscribed country listed in the U.S. Export Administration Regulations,
unless properly authorized by the U.S. Government.

15.4 Every notice or writing required or permitted under this Agreement shall
be signed by an authorized representative of the party initiating such notice
or writing and shall be delivered personally or sent by certified mail, return
receipt requested, postage prepaid; overnight mail or delivery; or telefax; to
the following address, unless modified by written notice of the party in
question:

FOR COMPAQ:

COMPAQ Computer Corporation
20555 S.H. 249
P.O. Box 692000
Houston, Texas 77269-2000
Telefax: 713-374-8332
Attn: Legal Department M060803

FOR VLSI:

VLSI Technology, Inc.
1109 McKay Drive
San Jose, California 95131
Attn: Legal Department

With a copy to:

VLSI Technology, Inc.
8375 South River Parkway
Tempe, Arizona 85284
Attn: Vice President, Portable Systems Division

15.9 VLSI may announce, disclose and advertise COMPAQ's contributions to
CHIPSET and the use of CHIPSET in COMPAQ products subsequent to COMPAQ's
announcement of such products.

<PAGE> 9
15.10 Unless otherwise stated herein, amounts stated as payable under this
Agreement include customs duties or sales, use, excise or other similar taxes
payable hereunder, which may be payable by VLSI.

15.11 The terms and conditions of this Agreement may not be superseded,
modified, or amended except in writing that states that it is such a
modification, and is signed by an authorized representative of each party
hereto.

15.14 This Agreement constitutes the complete and exclusive statement of the
agreement between the parties concerning the particular subject matter contained
herein and supersedes all prior understandings, communications, representations
and promises. No waiver, modification, or amendment shall be binding upon
either party unless in writing and signed for the parties through their duly
authorized representatives.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorized representatives, as of the day and year written
above.

COMPAQ COMPUTER CORPORATION VLSI TECHNOLOGY, INC.

BY: /s/Jim Hartzog By: /s/Henry Potts
Senior Vice President Vice President and
and General Manager, General Manager,
PC Division Portable Systems Division

DATE: 9/15/93 DATE: 9/15/93

<PAGE> 10
Exhibit A
CHIPSET SPECIFICATIONS
- ----------------------

CHIPSET Description. This specification is a core logic integrated circuit
design, consisting of two integrated circuits (a system controller and a
peripheral combo controller), for the portable computer market, to be marketed
under the VLSI trademark SCAMP(TM) IV, and hereafter referred to as "SCAMP(TM)
IV CHIPSET"

<PAGE> 11
Exhibit B
STATEMENT OF WORK (including SCAMP(TM) IV CHIPSET Deliverables and Schedule)

<TABLE>
<CAPTION>
Agreed Completion
Design Activity Responsible Party Completion Sign-off/Reference
or Milestone VLSI COMPAQ Joint Date Documents

- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
[ ] [ ] VLSI
COMPAQ
Ref. Doc.
- ----------------------------------------------------------------------------------------
</TABLE>

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 12
Exhibit B (continued)
STATEMENT OF WORK (including SCAMP(TM) IV CHIPSET Deliverables and Schedule)

<TABLE>
<CAPTION>
Agreed Completion
Design Activity Responsible Party Completion Sign-off/Reference
or Milestone VLSI COMPAQ Joint Date Documents

EXHIBIT C
PRODUCT SUPPORT ROYALTY CALCULATION

1. VLSI will pay to COMPAQ a PRODUCT SUPPORT ROYALTY in consideration for
COMPAQ's efforts in testing, debugging and validation and to promote VLSI's
CHIPSET for purchase by third parties ("PRODUCT SUPPORT ROYALTY"). This PRODUCT
SUPPORT ROYALTY will be payable for a period ending [ ] subsequent to the
shipment of INITIAL PRODUCTION DEVICES of CHIPSET to third parties by VLSI and
for CHIPSET made by or for third parties under license by VLSI. PRODUCT SUPPORT
ROYALTY will be paid [ ] after the end of the [ ] subsequent to the
shipment of INITIAL PRODUCTION DEVICES of CHIPSET to third parties, and
[ ] after the end of the [ ] subsequent to the shipment of INITIAL
PRODUCTION DEVICES of CHIPSET to third parties.

3. The royalty rate ("PRODUCT SUPPORT ROYALTY RATE") for the first shipment
year will be calculated at the end of the [ ] after the shipment of
INITIAL PRODUCTION DEVICES of CHIPSET to Third Parties. The PRODUCT SUPPORT
ROYALTY RATE will be calculated as the [ ] multiplied by the unit volume
of shipments of SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS to Third
Parties during the most recent [ ], up to a maximum PRODUCT SUPPORT
ROYALTY RATE of [ ]. For example, if [ ] units of CHIPSET are sold
by VLSI to Third Parties during the [ ], then the PRODUCT SUPPORT ROYALTY
RATE will be [ ].

4. The PRODUCT SUPPORT ROYALTY RATE for the second shipment year will be
calculated at the end of the [ ] after the shipment of INITIAL PRODUCTION
DEVICES of CHIPSET to Third Parties. PRODUCT SUPPORT ROYALTY RATE will be
calculated as the [ ] multiplied by the unit volume of shipments of
SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS to Third Parties during the
most recent [ ], up to a maximum PRODUCT SUPPORT ROYALTY RATE of
[ ]. For example, if [ ] units of SCAMP(TM) IV CHIPSETS and
QUADNOTE(TM) CHIPSETS are sold by VLSI to Third Parties during the [ ],
then the PRODUCT SUPPORT ROYALTY RATE will be [ ].

5. NET REVENUE shall mean revenue received by VLSI for the sale of SCAMP(TM) IV
CHIPSETS and QUADNOTE(TM) CHIPSETS to all parties (including COMPAQ), less any
adjustments for returns, other royalties and license fees payable to COMPAQ,
packing and shipping, and deductions for product sold to distributors with a
right of return, divided by the total number of SCAMP(TM) IV CHIPSETS and
QUADNOTE(TM) CHIPSETS sold to all parties, multiplied by the number of
SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS sold to Third Parties.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 14
under both the SCAMP(TM) IV Chipset Cooperation Agreement and the QUADNOTE(TM)
Chipset Cooperation Agreement.

A. VLSI has supplied to COMPAQ core logic chipsets (integrated
circuits with functions essentially similar to SCAMP(TM) IV CHIPSETS and
QUADNOTE(TM) CHIPSETS) for notebook and sub-notebook computer systems in a
volume [ ] of COMPAQ's total unit shipments of such computer systems (as
defined and as reported by either International Data Corporation, or Dataquest,
or such other commercial market data service in the event that International
Data Corporation and Dataquest cease to report such market data) totaled over a
consecutive period of [ ], and;

B. during each quarter in such consecutive period of [ ],
COMPAQ continues to sell greater than [ ] of the total worldwide
market sales of such computer systems (as defined and as reported by either
International Data Corporation, or Dataquest), and;

C. COMPAQ continues to use its reasonable efforts to indirectly
develop the market for VLSI's SCAMP(TM) IV CHIPSETS and QUADNOTE(TM) CHIPSETS
through marketing and promotion of COMPAQ's products using SCAMP(TM) IV
CHIPSETS and QUADNOTE(TM) CHIPSETS, including allowing VLSI to promote its
relationship with COMPAQ, and promote the use of SCAMP(TM) IV CHIPSETS and
QUADNOTE(TM) CHIPSETS by COMPAQ, then;

D. the period that the PRODUCT SUPPORT ROYALTY will be paid by VLSI to
COMPAQ will be extended by [ ] to a period ending [ ]
subsequent to the shipment of INITIAL PRODUCTION DEVICES of SCAMP(TM) IV
CHIPSET, and in addition, all existing DERIVATIVE WORKS of SCAMP(TM) IV CHIPSET
will be royalty bearing under this agreement. In such case, the PRODUCT SUPPORT
ROYALTY will be paid [ ] subsequent to the previous payment by VLSI
of the PRODUCT SUPPORT ROYALTY. Notwithstanding this provision, this extension
may be shortened as set out in Paragraphs 8, 9, or 10 below.

8. If the PRODUCT SUPPORT ROYALTY period has been extended beyond [ ],
as described in Section 7, and, then, if VLSI has sold to COMPAQ core logic
chipsets (integrated circuits with functions essentially similar to SCAMP(TM)
IV CHIPSET) for notebook and sub-notebook computer systems in a volume less
than [ ] of COMPAQ's total unit shipments of such computer systems
(as defined and as reported by either International Data Corporation, or
Dataquest) during that VLSI [ ], then VLSI will terminate further
PRODUCT SUPPORT ROYALTY payments to COMPAQ effective the end of the next
subsequent VLSI [ ].

9. If the PRODUCT SUPPORT ROYALTY period has been extended beyond [ ],
as described in Section 7, and, then, if COMPAQ does not sell greater than
[ ] of the total worldwide market sales of notebook and sub-notebook
computer systems (as defined and as reported by either International Data
Corporation, or Dataquest) during the previous [ ], then VLSI will
terminate further PRODUCT SUPPORT ROYALTY payments to COMPAQ effective the end
of the next subsequent VLSI [ ].

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED

<PAGE> 15
10. If the PRODUCT SUPPORT ROYALTY period has been extended beyond [ ],
as described in Section 7, and any DERIVATIVE WORKS to SCAMP(TM) IV CHIPSETS
and QUADNOTE(TM) CHIPSETS were not developed under the terms of a subsequent
agreement between COMPAQ and VLSI, which would supersede the terms of this
Agreement with regard to CHIPSET DERIVATIVE WORKS, then VLSI may, at any time
after the end of the initial [ ] period, elect to pay any royalties
that are payable on that date, plus an additional and final payment of
[ ], and such payment will be considered full payment of all PRODUCT
SUPPORT ROYALTY obligations under this Agreement and the QUADNOTE CHIPSET
Cooperation Agreement.

11. The PRODUCT SUPPORT ROYALTY RATE after the second shipment year will be
calculated at the end of the [ ] subsequent to the payment of the
PRODUCT SUPPORT ROYALTY. PRODUCT SUPPORT ROYALTY RATE will be calculated as the
[ ] multiplied by the unit volume of shipments of SCAMP(TM) IV
CHIPSETS and QUADNOTE(TM) CHIPSETS to Third Parties during the most recent
[ ], up to a maximum PRODUCT SUPPORT ROYALTY RATE of [ ].
For example, if [ ] units of SCAMP(TM) IV CHIPSETS and QUADNOTE(TM)
CHIPSETS are sold by VLSI to Third Parties during the [ ], then the
PRODUCT SUPPORT ROYALTY RATE will be [ ].

12. In the event that COMPAQ'S ability to fulfill the requirements of Paragraph
7 of this Exhibit is materially and detrimentally affected because VLSI is
unable or unwilling to accept COMPAQ's firm orders under reasonable terms, for a
period that exceeds [ ], then COMPAQ's performance pursuant to
Paragraph 7 on this Exhibit will be excused, for so long as VLSI does not
accept such orders, and VLSI will continue to be obligated to pay the royalties
as set forth in Paragraph 7 of this Exhibit.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED
<PAGE> 16
EXHIBIT D
LIMITED EXCLUSIVITY PROVISIONS

1. The LIMITED EXCLUSIVITY PERIOD hereinafter ("LIMITED EXCLUSIVITY PERIOD")
shall be [ ].

A. For the period of the LIMITED EXCLUSIVITY PERIOD, in advance of any
other VLSI customer, VLSI shall furnish COMPAQ with production revision
CHIPSETS, and COMPAQ shall be the sole customer that shall be entitled to
receive delivery for such revision CHIPSET for such LIMITED EXCLUSIVITY
PERIOD. Such LIMITED EXCLUSIVITY PERIOD shall begin when VLSI has delivered to
COMPAQ the INITIAL PRODUCTION DEVICES (as set forth in Section 4.5), but
shall be relinquished and waived by COMPAQ if such INITIAL PRODUCTION DEVICES
are not ordered by COMPAQ. The parties hereto intend for the foregoing
provision to provide COMPAQ an opportunity to exercise a head start advantage
at the time that production revision devices are available in production
quantities equal to the LIMITED EXCLUSIVITY PERIOD. In the event that VLSI is
unable to deliver COMPAQ's first delivery of up to [ ] of
production orders for CHIPSET subsequent to approval of CHIPSET by COMPAQ,
within a lead-time of [ ] after receipt of order, VLSI agrees to
extend the LIMITED EXCLUSIVITY PERIOD day to day until such delivery is made.

2. Notwithstanding the other provisions of this Exhibit D, for [ ]
OEM customer, other than COMPAQ, VLSI may, at its sole option, waive the
limitations of LIMITED EXCLUSIVITY PROVISIONS herein. Such OEM customer may
have access to VLSI CHIPSET SPECIFICATION, samples, INITIAL PRODUCTION
DEVICES, and production CHIPSET devices, and other VLSI information, products
and services without restriction or delay.

[ ] Text omitted - CONFIDENTIAL TREATMENT REQUESTED