Exhibit 10.1

LSI LOGIC CORPORATION

ABHIJIT Y. TALWALKAR EMPLOYMENT AGREEMENT

     This Agreement is entered into as of May 23, 2005, by and between LSI Logic
Corporation (the “Company”) and Abhijit Y. Talwalkar (“Executive”).

     1. Duties and Scope of Employment.

          (a) Positions and Duties. As of May 23, 2005 (the “Effective Date”),
Executive will serve as President and Chief Executive Officer, reporting to the
Company’s Board of Directors (the “Board”). Executive will render such business
and professional services in the performance of his duties, consistent with
Executive’s position within the Company, as will reasonably be assigned to him
by the Board. The period Executive is employed by the Company under this
Agreement is referred to herein as the “Employment Term”.

          (b) Board Membership. Executive will be appointed to serve as a member
of the Board as of the Effective Date. Thereafter, at each annual meeting of the
Company’s stockholders during the Employment Term, the Company will nominate
Executive to serve as a member of the Board. Executive’s service as a member of
the Board will be subject to any required stockholder approval. Upon the
termination of Executive’s employment for any reason, unless otherwise requested
by the Board, Executive will be deemed to have resigned from the Board (and any
boards of subsidiaries) voluntarily, without any further required action by the
Executive, as of the end of the Executive’s employment and Executive, at the
Board’s request, will execute any documents necessary to reflect his
resignation.

          (c) Obligations. During the Employment Term, Executive will devote
Executive’s full business efforts and time to the Company and will use good
faith efforts to discharge Executive’s obligations under this Agreement to the
best of Executive’s ability and in accordance with each of the Company’s
corporate guidance and ethics guidelines, conflict of interests policies and
code of conduct. For the duration of the Employment Term, Executive agrees not
to actively engage in any other employment, occupation, or consulting activity
for any direct or indirect remuneration without the prior approval of the Board
(which approval will not be unreasonably withheld); provided, however, that
Executive may, without the approval of the Board, serve in any capacity with any
civic, educational, or charitable organization, provided such services do not
interfere with Executive’s obligations to Company.

               (i) Executive hereby represents and warrants to the Company that
Executive is not party to any contract, understanding, agreement or policy,
written or otherwise, that would be breached by the Executive’s entering into,
or performing services under, this Agreement. Executive further represents that
he has disclosed to the Company in writing all threatened, pending, or actual
claims that are unresolved and still outstanding as of the Effective Date, in
each case, against Executive of which he is aware, if any, as a result of his
employment with his current employer (or any other previous employer) or his
membership on any boards of directors.

 

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          (d) Other Entities. Executive agrees to serve, without additional
compensation, as an officer and director for each of the Company’s subsidiaries,
partnerships, joint ventures, limited liability companies and other affiliates,
including entities in which the Company has a significant investment as
determined by the Company. As used in this Agreement, the term “affiliates” will
include any entity controlled by, controlling, or under common control of the
Company.

     2. At-Will Employment. Executive and the Company agree that Executive’s
employment with the Company constitutes “at-will” employment. Executive and the
Company acknowledge that this employment relationship may be terminated at any
time, upon written notice to the other party, with or without good cause or for
any or no cause, at the option either of the Company or Executive. However, as
described in this Agreement, Executive may be entitled to severance benefits
depending upon the circumstances of Executive’s termination of employment.

     3. Term of Agreement. This Agreement will have an initial term of two
(2) years commencing on the Effective Date. On the second anniversary of the
Effective Date, and on each annual anniversary of the Effective Date thereafter,
this Agreement automatically will renew for an additional one (1) year term
unless either party provides the other party with written notice of non-renewal
at least 120 days prior to the date of automatic renewal.

     4. Compensation.

          (a) Base Salary. As of the Effective Date, the Company will pay
Executive an annual salary of $800,000 as compensation for his services (such
annual salary, as is then effective, to be referred to herein as “Base Salary”).
The Base Salary will be paid periodically in accordance with the Company’s
normal payroll practices and be subject to the usual, required withholdings.

          (b) Annual Incentive. Executive will be eligible to receive annual
cash incentives payable for the achievement of performance goals established by
the Board or by the Compensation Committee of the Board (the “Committee”).
Executive’s target annual incentive will be at least 100% of Base Salary. For
Executive’s first year of employment, all performance goals will be deemed to
have been achieved at 100% of target with such cash incentive to be paid at the
first Board meeting following the end of the Company’s 2005 fiscal year. The
actual earned annual cash incentive, if any, payable to Executive for any
performance period will depend upon the extent to which the applicable
performance goal(s) specified by the Committee are achieved and will be
decreased or increased for under- or over-performance.

          (c) Stock Options.

               (i) As of the Effective Date, Executive will be granted
nonstatutory stock options to purchase 1,500,000 shares of Company common stock
at an exercise price equal to the closing price per share on the New York Stock
Exchange (“NYSE”) for the common stock of the Company on the Effective Date (the
“Initial Option”). The Initial Option will be granted under and subject to the
terms, definitions and provisions of the Company’s 1991 Equity Incentive Plan
(the “1991 Plan”) and will be scheduled to vest at a rate of 25% on each
anniversary of the grant over four (4) years assuming Executive’s continued
employment with the Company on each scheduled vesting date. Except as provided
in this Agreement, the Initial Option will be subject to the Company’s standard
terms and conditions for options granted under the 1991 Plan.

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               (ii) As of the Effective Date, Executive will be granted
nonstatutory stock options to purchase 500,000 shares of Company common stock at
an exercise price equal to the closing price per share on the NYSE for the
common stock of the Company on the Effective Date (the “Stand-Alone Grant”). The
Stand-Alone Grant will be granted under a non-stockholder approved arrangement
outside of any Company equity plan. Subject to the provisions of this Agreement,
the terms and conditions of the Stand-Alone Grant will be materially similar to
those of the Initial Option (except that they will not be granted under a
Company equity plan) and will be scheduled to vest at a rate of 25% on each
anniversary of the grant over four (4) years assuming Executive’s continued
employment with the Company on each scheduled vesting date.

               (iii) Within fifteen (15) days after the Effective Date,
Executive will be granted nonstatutory stock options to purchase 2,000,000
shares of Company common stock at an exercise price equal to the closing price
per share on the NYSE for the common stock of the Company on the date of grant
(the “Additional Option”). Subject to the provisions of this Agreement, the
Additional Option will be granted under and subject to the terms, definitions
and provisions of the Company’s 2003 Equity Incentive Plan (the “2003 Plan”) and
will be scheduled to vest based on Executive attaining certain performance
criteria as determined by the Compensation Committee. Executive will be
permitted to provide input to the Compensation Committee regarding the
performance criteria prior to the Committee’s final determination of the
criteria. Notwithstanding the foregoing, the Additional Option will be scheduled
to fully vest six (6) years after the date of grant, whether or not the
performance goals are met and subject to Executive’s continued employment with
the Company on each scheduled vesting date. Except as provided in this
Agreement, the Additional Option will be subject to the Company’s standard terms
and conditions for options granted under the 2003 Plan.

               (iv) As of the Effective Date, Executive will be granted 500,000
restricted stock units (the “RSU Grant”). The RSU Grant will be granted under
and subject to the terms, definitions and provisions of the Company’s 2003 Plan,
and will be scheduled to vest at a rate of 1/3 on each anniversary of the grant
over three (3) years assuming Executive’s continued employment with the Company
on each scheduled vesting date. Any portion of the RSU Grant that becomes vested
will be settled in shares of Company common stock promptly after vesting. Except
as provided in this Agreement, the RSU Grant will be subject to the Company’s
standard terms and conditions for restricted stock units granted under the 2003
Plan.

               (v) The Company will use its commercially reasonable best efforts
to register all shares covered by the Initial Option, the Stand-Alone Option,
the Additional Option and the RSU Grant on Form S-8 as soon as practicable
following the Effective Date.

          (d) Sign-on Bonus. Within thirty (30) days of the Effective Date,
Executive will receive a signing bonus equal to $500,000 (the “Signing Bonus”).

     5. Employee Benefits.

          (a) Generally. Executive will be eligible to participate in accordance
with the terms of all Company employee benefit plans, policies and arrangements
that are applicable to other executive officers of the Company, as such plans,
policies and arrangements may exist from time to time.

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          (b) Relocation Benefits.

               (i) The Company will maintain an office for Executive in both
Gresham, Oregon and Milpitas, California.

               (ii) During the first three (3) months of the Employment Term,
the Company will reimburse Executive for all reasonable and actual costs
associated with leasing a furnished apartment.

               (iii) During the first two (2) years of the Employment Term, the
Company will provide Executive with a $5,000 per month housing allowance.

               (iv) If Executive sells his home located in the state of Oregon
and purchases a new home in the San Jose, California area (or any other location
in proximity to the Company’s then corporate headquarters) within the first two
(2) years of the Employment Term, the Company will reimburse Executive for his
reasonable and documented closing costs (including the reasonable cost of a
broker’s commission) associated with such sale and/or purchase provided that
Executive complies with the Company’s then existing Relocation Policy, if
applicable, and provided that Executive uses a third party reasonably
satisfactory to the Company to handle such sale. The Company will pay
Executive’s reasonable costs associated with moving Executive’s household goods
and personal items.

               (v) To the extent any of the relocation benefits provided for in
this Section 5(b) are included in Executive’s gross income for tax purposes,
Executive will receive from the Company an additional payment sufficient to pay
any federal and state income and employment taxes arising from payments made to
the Executive pursuant to this Section 5(b) (including any payments made
pursuant to this Section 5(b)(v)).

     6. Expenses. The Company will reimburse Executive for reasonable travel,
entertainment and other expenses incurred by Executive in the furtherance of the
performance of Executive’s duties hereunder, in accordance with the Company’s
expense reimbursement policy as in effect from time to time.

     7. Termination of Employment. In the event Executive’s employment with the
Company terminates for any reason, Executive will be entitled to any (a) unpaid
Base Salary accrued up to the effective date of termination, (b) unpaid, but
earned and accrued annual incentive for any completed fiscal year as of his
termination of employment, (c) pay for accrued but unused vacation that the
Company is legally obligated to pay Executive, (d) benefits or compensation as
provided under the terms of any employee benefit and compensation agreements or
plans applicable to Executive, (e) unreimbursed business expenses required to be
reimbursed to Executive, and (f) rights to indemnification Executive may have
under the Company’s Articles of Incorporation, Bylaws, the Agreement, or
separate indemnification agreement, as applicable. In addition, if the
termination is by the Company without Cause or the Executive resigns for Good
Reason, Executive will be entitled to the amounts and benefits specified in
Section 8.

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     8. Severance.

          (a) Termination Without Cause or Resignation for Good Reason other
than in Connection with a Change of Control. If Executive’s employment is
terminated by the Company without Cause or if Executive resigns for Good Reason,
and such termination is not in Connection with a Change of Control, then,
subject to Section 9, Executive will receive: (i) continued payment of Base
Salary for eighteen (18) months in accordance with the Company’s normal payroll
policies; (ii) continued payment in an amount equal to 150% of Executive’s
target bonus for the year in which the termination occurs in accordance with the
Company’s normal payroll policies; (iii) eighteen (18) months accelerated
vesting with respect to Executive’s then outstanding, unvested equity awards
with any such awards that have annual time-based installment vesting instead
deemed to vest (for this purpose only) in monthly installments at the same
overall rate and with such vesting acceleration to be measured beginning from
the day immediately following the immediately preceding annual vesting date
(notwithstanding the foregoing, the number of shares subject to the Additional
Option that will vest under this Section 8(a) will equal 25% of the total number
of shares subject to the Additional Option less the number of shares that
actually vest prior to the termination date) and with a post-termination
exercise period equal to the earlier of (A) twelve (12) months from the date of
termination or (B) the applicable scheduled expiration date of such award as set
forth in the award agreement, and (iv) reimbursement for premiums paid for
continued health benefits for Executive (and any eligible dependents) under the
Company’s health plans for eighteen (18) months, payable when such premiums are
due (provided Executive validly elects to continue coverage under applicable
law).

          (b) Termination Without Cause or Resignation for Good Reason in
Connection with a Change of Control. If Executive’s employment is terminated by
the Company without Cause or by Executive for Good Reason, and the termination
is in Connection with a Change of Control, then, subject to Section 9, Executive
will receive: (i) continued payment of Base Salary for twenty-four (24) months
in accordance with the Company’s normal payroll policies; (ii) current year’s
target incentive compensation pro-rated to the date of termination, with such
pro-rated amount to be calculated by multiplying the current year’s target
incentive compensation by a fraction with a numerator equal to the number of
days between the start of the current calendar year and the date of termination
and a denominator equal to 365; (iii) continued payments in an amount equal to
200% of Executive’s target bonus for the year in which the termination occurs in
accordance with the Company’s normal payroll policies; (iv) full accelerated
vesting with respect to Executive’s then outstanding unvested equity awards with
post-term exercise period equal to the earlier of (A) twelve (12) months from
the date of termination or (B) the applicable scheduled expiration date of such
award as set forth in the award agreement, and (v) reimbursement for premiums
paid for continued health benefits for Executive (and any eligible dependents)
under the Company’s health plans for twenty-four (24) months, payable when such
premiums are due (provided Executive validly elects to continue coverage under
applicable law).

          (c) Voluntary Termination Without Good Reason or Termination for
Cause. If Executive’s employment is terminated voluntarily, including due to
death or Disability, without Good Reason or is terminated for Cause by the
Company, then, except as provided in Section 7, (i) all further vesting of
Executive’s outstanding equity awards will terminate immediately; (ii) all
payments of compensation by the Company to Executive hereunder will terminate
immediately, and

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(iii) Executive will be eligible for severance benefits only in accordance with
the Company’s then established plans, programs and practices.

     9. Conditions to Receipt of Severance; No Duty to Mitigate.

          (a) Separation Agreement and Release of Claims. The receipt of any
severance pursuant to Section 8 will be subject to Executive signing and not
revoking a separation agreement and release of claims in a form reasonably
acceptable to the Company. No severance will be paid or provided until the
separation agreement and release agreement becomes effective.

          (b) Non-solicitation and Non-competition. The receipt of any severance
pursuant to Section 8 will be subject to the Executive agreeing that during the
Employment Term and Continuance Period, Executive will not (i) solicit any
employee of the Company (other than Executive’s personal assistant) for
employment other than at the Company, or (ii) directly or indirectly engage in,
have any ownership interest in or participate in any entity that as of the date
of termination, competes with the Company in any substantial business of the
Company or any business reasonably expected to become a substantial business of
the Company. The Executive’s passive ownership of not more than 1% of any
publicly traded company and/or 5% ownership of any privately held company will
not constitute a breach of this Section 9(b).

          (c) Nondisparagement. During the Employment Term and Continuance
Period, Executive will not knowingly disparage, criticize, or otherwise make any
derogatory statements regarding the Company, its directors, or its officers. The
Company will instruct its officers and directors to not knowingly disparage,
criticize, or otherwise make any derogatory statements regarding the Executive
during the Employment Term and Continuance Period. Notwithstanding the
foregoing, nothing contained in this agreement will be deemed to restrict the
Executive, the Company or any of the Company’s current or former officers and/or
directors from providing information to any governmental or regulatory agency
(or in any way limit the content of any such information) to the extent they are
requested or required to provide such information pursuant to applicable law or
regulation.

          (d) Other Requirements. Executive’s receipt of continued severance
payments will be subject to Executive continuing to comply with the terms of the
Confidential Information Agreement and the provisions of this Section 9.

          (e) No Duty to Mitigate. Executive will not be required to mitigate
the amount of any payment contemplated by this Agreement, nor will any earnings
that Executive may receive from any other source reduce any such payment.

     10. Excise Tax Gross-Up. In the event that the benefits provided for in
this Agreement constitute “parachute payments” within the meaning of
Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and
will be subject to the excise tax imposed by Section 4999 of the Code, then
Executive will receive (i) a payment from the Company sufficient to pay such
excise tax, and (ii) an additional payment from the Company sufficient to pay
the federal and state income and employment taxes and additional excise taxes
arising from the payments made to the Executive by the Company pursuant to this
sentence. Notwithstanding any contrary provision in this Agreement, under no
circumstances will the Company be required to pay to Executive an amount

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greater than two times the sum of Executive’s Base Salary and target annual cash
incentive pursuant to this Section 10. Unless Executive and the Company agree
otherwise in writing, the determination of Executive’s excise tax liability, if
any, and the amount, if any, required to be paid under this Section 10 will be
made in writing by the independent auditors who are primarily used by the
Company immediately prior to the Change of Control (the “Accountants”). For
purposes of making the calculations required by this Section 10, the Accountants
may make reasonable assumptions and approximations concerning applicable taxes
and may rely on reasonable, good faith interpretations concerning the
application of Sections 280G and 4999 of the Code. Executive and the Company
agree to furnish such information and documents as the Accountants may
reasonably request in order to make a determination under this Section 10. The
Company will bear all costs the Accountants may reasonably incur in connection
with any calculations contemplated by this Section 10.

     11. Definitions.

          (a) Cause. For purposes of this Agreement, “Cause” will mean:

               (i) Executive’s willful and continued failure to perform the
duties and responsibilities of his position after there has been delivered to
Executive a written demand for performance from the Board which describes the
basis for the Board’s belief that Executive has not substantially performed his
duties and provides Executive with thirty (30) days to take corrective action;

               (ii) Any act of personal dishonesty taken by Executive in
connection with his responsibilities as an employee of the Company with the
intention or reasonable expectation that such action may result in substantial
personal enrichment of Executive;

               (iii) Executive’s conviction of, or plea of nolo contendre to, a
felony that the Board reasonably believes has had or will have a material
detrimental effect on the Company’s reputation or business; or

               (iv) A breach of any fiduciary duty owed to the Company by the
Executive that has a material detrimental effect on the Company’s reputation or
business.

          (b) Change of Control. For purposes of this Agreement, “Change of
Control” will mean the occurrence of any of the following events:

               (i) The consummation by the Company of a merger or consolidation
of the Company with any other corporation, other than a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 50% of the total voting power represented by the voting
securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation;

               (ii) The approval by the stockholders of the Company, or if
stockholder approval is not required, approval by the Board, of a plan of
complete liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all of the Company’s assets;

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               (iii) Any “person” (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) becoming the
“beneficial owner” (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 50% or more of the total
voting power represented by the Company’s then outstanding voting securities; or

               (iv) A change in the composition of the Board, as a result of
which fewer than a majority of the directors are Incumbent Directors. “Incumbent
Directors” will mean directors who either (A) are directors of the Company as of
the date hereof, or (B) are elected, or nominated for election, to the Board
with the affirmative votes of at least a majority of those directors whose
election or nomination was not in connection with any transactions described in
subsections (i), (ii), or (iii) or in connection with an actual or threatened
proxy contest relating to the election of directors of the Company.

          (c) Continuance Period. For purposes of this Agreement, “Continuance
Period” will mean the period of time beginning on the date of the termination of
Executive’s employment and ending on the date on which Executive is no longer
receiving Base Salary payments under Section 8.

          (d) Disability. For purposes of this Agreement, Disability will have
the same meaning as in the Company’s long-term disability plan.

          (e) Good Reason. For purposes of this Agreement, “Good Reason” means
the occurrence of any of the following, without Executive’s express written
consent:

               (i) A significant reduction of Executive’s duties, position, or
responsibilities, relative to Executive’s duties, position, or responsibilities
in effect immediately prior to such reduction;

               (ii) A substantial reduction by the Company, without good
business reasons, of the facilities and perquisites (including office space and
location) available to Executive immediately prior to such reduction;

               (iii) A material reduction in the kind or level of employee
benefits to which Executive is entitled immediately prior to such reduction with
the result that Executive’s overall benefits package is significantly reduced
other than pursuant to a one-time reduction that also is applied to
substantially all other executive officers of the Company and that reduces the
level of employee benefits by a percentage reduction that is no greater than
10%;

               (iv) A reduction in Executive’s Base Salary or annual cash
incentive as in effect immediately prior to such reduction other than pursuant
to a one-time reduction that also is applied to substantially all other
executive officers of the Company and which one-time reduction reduces the Base
Salary and/or annual cash incentive by a percentage reduction that is no greater
than 10%;

               (v) The relocation of Executive to a facility or location more
than twenty-five (25) miles from his current place of employment; or

               (vi) The failure of the Company to obtain the assumption of the
employment agreement by a successor.

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The failure of the Company’s stockholders to elect or reelect the Executive to
the Board shall not constitute Good Reason for purposes of this Agreement.

          (f) In Connection with a Change of Control. For purposes of this
Agreement, a termination of Executive’s employment with the Company is “in
Connection with a Change of Control” if Executive’s employment is terminated
within twelve (12) months following a Change of Control.

     12. Indemnification. Subject to applicable law, Executive will be provided
indemnification to the maximum extent permitted by the Company’s Articles of
Incorporation or Bylaws, including, if applicable, any directors and officers
insurance policies, with such indemnification to be on terms determined by the
Board or any of its committees, but on terms no less favorable than provided to
any other Company executive officer or director and subject to the terms of any
separate written indemnification agreement.

     13. Confidential Information. Executive will execute the Company’s standard
form of confidential information, intellectual property, non-competition and
non-solicitation agreement, appended hereto as Exhibit A (the “Confidential
Information Agreement”).

     14. Assignment. This Agreement will be binding upon and inure to the
benefit of (a) the heirs, executors and legal representatives of Executive upon
Executive’s death, and (b) any successor of the Company. Any such successor of
the Company will be deemed substituted for the Company under the terms of this
Agreement for all purposes. For this purpose, “successor” means any person,
firm, corporation, or other business entity which at any time, whether by
purchase, merger, or otherwise, directly or indirectly acquires all or
substantially all of the assets or business of the Company. None of the rights
of Executive to receive any form of compensation payable pursuant to this
Agreement may be assigned or transferred except by will or the laws of descent
and distribution. Any other attempted assignment, transfer, conveyance, or other
disposition of Executive’s right to compensation or other benefits will be null
and void.

     15. Notices. All notices, requests, demands and other communications called
for hereunder will be in writing and will be deemed given (a) on the date of
delivery if delivered personally, (b) one (1) day after being sent overnight by
a well established commercial overnight service, or (c) four (4) days after
being mailed by registered or certified mail, return receipt requested, prepaid
and addressed to the parties or their successors at the following addresses, or
at such other addresses as the parties may later designate in writing:

If to the Company:

Attn: Chairman of the Compensation Committee
c/o Corporate Secretary
LSI Logic Corporation
1621 Barber Lane
Milpitas, CA 95035

If to Executive:

at the last residential address known by the Company.

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     16. Severability. If any provision hereof becomes or is declared by a court
of competent jurisdiction to be illegal, unenforceable, or void, this Agreement
will continue in full force and effect without said provision.

     17. Arbitration. The Parties agree that any and all disputes arising out of
the terms of this Agreement, Executive’s employment by the Company, Executive’s
service as an officer or director of the Company, or Executive’s compensation
and benefits, their interpretation and any of the matters herein released, will
be subject to binding arbitration in Santa Clara, California before the American
Arbitration Association under its National Rules for the Resolution of
Employment Disputes, supplemented by the California Rules of Civil Procedure.
The Parties agree that the prevailing party in any arbitration will be entitled
to injunctive relief in any court of competent jurisdiction to enforce the
arbitration award. The Parties hereby agree to waive their right to have any
dispute between them resolved in a court of law by a judge or jury. This
paragraph will not prevent either party from seeking injunctive relief (or any
other provisional remedy) from any court having jurisdiction over the Parties
and the subject matter of their dispute relating to Executive’s obligations
under this Agreement and the Confidential Information Agreement.

     18. Legal and Tax Expenses. The Company will reimburse Executive up to
$20,000 for reasonable legal advice expenses incurred by him in connection with
the negotiation, preparation and execution of this Agreement.

     19. Integration. This Agreement, together with the Confidential Information
Agreement and the standard forms of equity award grant that describe Executive’s
outstanding equity awards, represents the entire agreement and understanding
between the parties as to the subject matter herein and supersedes all prior or
contemporaneous agreements whether written or oral. No waiver, alteration, or
modification of any of the provisions of this Agreement will be binding unless
in a writing and signed by duly authorized representatives of the parties
hereto. In entering into this Agreement, no party has relied on or made any
representation, warranty, inducement, promise, or understanding that is not in
this Agreement.

     20. Waiver of Breach. The waiver of a breach of any term or provision of
this Agreement, which must be in writing, will not operate as or be construed to
be a waiver of any other previous or subsequent breach of this Agreement.

     21. Survival. The Confidential Information Agreement and the Company’s and
Executive’s responsibilities under Sections 8 and 9 will survive the termination
of this Agreement.

     22. Headings. All captions and Section headings used in this Agreement are
for convenient reference only and do not form a part of this Agreement.

     23. Tax Withholding. All payments made pursuant to this Agreement will be
subject to withholding of applicable taxes.

     24. Governing Law. This Agreement will be governed by the laws of the State
of California without regard to its conflict of laws provisions.

     25. Acknowledgment. Executive acknowledges that he has had the opportunity
to discuss this matter with and obtain advice from his private attorney, has had
sufficient time to, and

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has carefully read and fully understands all the provisions of this Agreement,
and is knowingly and voluntarily entering into this Agreement.

     26. Conditions. This offer is conditioned upon Executive providing to
Company references relating to Executive’s employment in a form acceptable to
the Company, and Company’s satisfactory review of such references.

     27. Code Section 409A. The Company and the Executive agree to work together
in good faith to consider amendments to this Agreement necessary or appropriate
to avoid imposition of any additional tax or income recognition prior to actual
payment to Executive under Code Section 409A and any temporary or final Treasury
Regulations and Internal Revenue Service guidance thereunder.

     28. Counterparts. This Agreement may be executed in counterparts, and each
counterpart will have the same force and effect as an original and will
constitute an effective, binding agreement on the part of each of the
undersigned.

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     IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the
case of the Company by a duly authorized officer, as of the day and year written
below.

COMPANY:

LSI LOGIC CORPORATION

     
/s/ Matthew J. O’Rourke
  Date: May 23, 2005
Matthew J. O’Rourke
   
Chairman of the Compensation Committee
   
 
   
EXECUTIVE:
   
 
   
/s/ Abhijit Y. Talwalkar
  Date: May 23, 2005
Abhijit Y. Talwalkar
   

[SIGNATURE PAGE TO TALWALKAR EMPLOYMENT AGREEMENT]

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