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                                                                   EXHIBIT 10.40


                                    EXECUTIVE
                                CHANGE IN CONTROL
                          SEVERANCE BENEFITS AGREEMENT


         THIS EXECUTIVE CHANGE IN CONTROL SEVERANCE BENEFITS AGREEMENT (the
"AGREEMENT") is entered into this [DAY] day of [MONTH] 1996 between [Executive 
Name] ("Executive") and VLSI TECHNOLOGY, INC., a Delaware corporation (the 
"COMPANY"). This Agreement is intended to provide Executive with the 
compensation and benefits described herein upon the occurrence of specific 
events.

         Certain capitalized terms used in this Agreement are defined in Article
VI.

         The Company and Executive hereby agree as follows:


                                    ARTICLE I
                            EMPLOYMENT BY THE COMPANY

         1.1      Executive is currently employed as an executive of the 
Company.

         1.2 This Agreement shall remain in full force and effect so long as
Executive is employed by Company; provided, however, that the rights and
obligations of the parties hereto contained in Articles II through VII shall
survive YearsFollowingTerm years following a Covered Termination (as hereinafter
defined).

         1.3 The Company and Executive wish to set forth the compensation and
benefits which Executive shall be entitled to receive in the event that there is
a Change in Control or Executive's employment with the Company terminates
following a Change in Control under the circumstances described in Article II of
this Agreement.

         1.4 The duties and obligations of the Company to Executive under this
Agreement shall be in consideration for Executive's past services to the
Company, Executive's continued employment with the Company and Executive's
execution of the general waiver and release described in Section 3.2.

         1.5 This Agreement shall not supersede or affect any other agreements
relating to Executive's employment or severance, or a change in control of the



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Company, excepting only the Management Continuity Agreement between the Company
and Executive.





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                                   ARTICLE II
                               SEVERANCE BENEFITS

         2.1 ENTITLEMENT TO SEVERANCE BENEFITS. If Executive's employment
terminates due to an Involuntary Termination or a Voluntary Termination for Good
Reason within twenty-four (24) months following a Change in Control, the
termination of employment will be a Covered Termination and the Company shall
pay Executive the compensation and benefits described in this Article II. If
Executive's employment terminates, but not due to an Involuntary Termination or
a Voluntary Termination for Good Reason within twenty-four (24) months following
a Change in Control, then the termination of employment will not be a Covered
Termination and Executive will not be entitled to receive any payments or
benefits under this Article II.

         Payment of any benefits described in this Article II shall be subject
to the restrictions and limitations set forth in Article III.

         2.2 LUMP SUM SEVERANCE PAYMENT. Within thirty (30) days following a
Covered Termination, Executive shall receive a lump sum payment equal to Percent
of the sum of Annual Base Pay and Annual Bonus, subject to any applicable
withholding of federal, state or local taxes.

        2.3 STOCK OPTIONS. In accordance with Section 4. 3, certain stock
options held by the Executive may become fully vested and exercisable upon a
Change in Control (regardless of whether a Covered Termination occurs) and the
period of time following a Covered Termination may be extended.

         2.4 WELFARE BENEFITS. Following a Covered Termination, Executive and
his covered dependents will be eligible to continue their Welfare Benefit
coverage under any Welfare Benefit plan or program maintained by the Company on
the same terms and conditions (including cost to Executive) as in effect
immediately prior to the Covered Termination, for the [YearsFollowingTerm] 
years following the Covered Termination.

         With respect to any Welfare Benefits provided through an insurance
policy, the Company's obligation to provide such Welfare Benefits following a
Covered Termination shall be limited by the terms of such a policy; provided
that (i) the Company shall make reasonable efforts to amend such policy to
provide the continued coverage described in this Section 2.4, and (ii) if a
policy providing health benefits is not amended to provide the continued
benefits described in this Section 2.4, the Company shall pay for the cost of
comparable replacement coverage (or Medigap 


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insurance if Executive qualifies for Medicare) until the end of the [YearPeriod]
year period following the Covered Termination.

         The Company shall reimburse Executive for any income tax liability due
as a result of the provision of Welfare Benefits under this Article II (and as a
result of any payments due under this paragraph) in order to put Executive in
the same after-tax position as if no taxable Welfare Benefits had been provided.

         This Section 2.4 is not intended to affect, nor does it affect, the
rights of Executive, or Executive's covered dependents, under any applicable law
with respect to health insurance continuation coverage.

         2.5 MITIGATION. Except as otherwise specifically provided herein,
Executive shall not be required to mitigate damages or the amount of any payment
provided under this Agreement by seeking other employment or otherwise, nor
shall the amount of any payment provided for under this Agreement be reduced by
any compensation earned by Executive as a result of employment by another
employer or by retirement benefits after the date of the Covered Termination, or
otherwise.


                                   ARTICLE III
                     LIMITATIONS AND CONDITIONS ON BENEFITS

         3.1 WITHHOLDING OF TAXES. The Company shall withhold appropriate
federal, state or local income and employment taxes from any payments hereunder.

         3.2 EMPLOYEE AGREEMENT AND RELEASE PRIOR TO RECEIPT OF BENEFITS. Upon
the occurrence of a Covered Termination, and prior to the receipt of any
benefits under this Agreement on account of the occurrence of a Covered
Termination, Executive shall, as of the date of a Covered Termination, execute
an employee agreement and release in the form attached hereto as Exhibit A. Such
employee agreement and release shall specifically relate to all of Executive's
rights and claims in existence at the time of such execution and shall confirm
Executive's obligations under the Company's standard form of proprietary
information agreement. It is understood that Executive has twenty-one (21) days
to consider whether to execute such employee agreement and release and Executive
may revoke such employee agreement and release within seven (7) business days
after execution of such employee agreement and release. In the event Executive
does not execute such employee agreement and release within the twenty-one (21)
day period, or if Executive revokes such employee agreement and release within
the seven (7) business 



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day period, no benefits shall be payable under this Agreement and this Agreement
shall be null and void.


                                   ARTICLE IV
                            OTHER RIGHTS AND BENEFITS

         4.1 NONEXCLUSIVITY. Nothing in the Agreement shall prevent or limit
Executive's continuing or future participation in any benefit, bonus, incentive
or other plans, programs, policies or practices provided by the Company and for
which Executive may otherwise qualify, nor shall anything herein limit or
otherwise affect such rights as Executive may have under any stock option or
other agreements with the Company. Except as otherwise expressly provided
herein, amounts which are vested benefits or which Executive is otherwise
entitled to receive under any plan, policy, practice or program of the Company
at or subsequent to the date of a Covered Termination shall be payable in
accordance with such plan, policy, practice or program.

         4.2 PARACHUTE PAYMENTS. In the event that any amount or benefit
received or to be received by Executive pursuant to this Agreement (other than
payment pursuant to this Section 4.2) would constitute an "excess parachute
payment" subject to excise tax under Section 4999 of the Code, the Company shall
pay to Executive the amount of any such excise tax; provided, however, that no
payment shall be made under this Section 4.2 to the extent that it would reduce
Executive's after-tax income.

         4.3 STOCK OPTIONS. Company shall take all actions necessary to amend
all stock option agreements evidencing outstanding stock options granted to
Executive: (i) to provide for full vesting of stock options upon a Change in
Control, (ii) to permit Executive to exercise any vested options following his
termination of service to the Company as an employee or consultant for up to
three (3) months (or such longer period as may currently apply) and (iii) to
permit Executive to exercise the options for at least the twelve (12) months
following a Covered Termination. Notwithstanding the foregoing, the Company
shall not amend a stock option agreement to the extent that an amendment would
result in a charge to earnings for the Company, would adversely affect
Executive's financial position, or cause Executive to be subject to liability
under Section 16(b) of the Securities Exchange Act of 1934, as amended.


                                    ARTICLE V
                           NON-ALIENATION OF BENEFITS



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         No benefit hereunder shall be subject to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance or charge, and any attempt to so
subject a benefit hereunder shall be void.


                                   ARTICLE VI
                                   DEFINITIONS

         For purposes of the Agreement, the following terms shall have the
meanings set forth below:

        6.1 "AGREEMENT" means this Executive Change in Control Severance
Benefits Agreement.

         6.2 "ANNUAL BASE PAY" means Executive's annual base pay at the rate in
effect during the last regularly scheduled payroll period immediately preceding
(i) the Change in Control or (ii) the Covered Termination, whichever is greater.




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         6.3 "ANNUAL BONUS" means the greater of (i) Executive's most recent
actual annual cash incentive bonus for fiscal years of the Company preceding the
year in which the Change in Control occurs or in which Executive's employment
terminates following the occurrence of a Change in Control, whichever is
greater, or (ii) Executive's projected or estimated annual cash incentive bonus
for the fiscal year of the Company in which termination of employment occurs.

        6.4 "CHANGE IN CONTROL" means the consummation of any of the following
transactions:

                  (a) the stockholders of the Company approve 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) at least fifty percent (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, or the stockholders
of the Company approve a plan of liquidation or dissolution of the Company or an
agreement for the sale, lease, exchange or other transfer or disposition by the
Company of all or substantially all (more than fifty percent (50%)) of the
Company's assets;

                  (b) any person (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")),
is or becomes the beneficial owner (within the meaning of Rule 13d-3 under the
Exchange Act) directly or indirectly of 25% or more of the Company's outstanding
Common Stock; or

                  (c) a change in the composition of the Board of Directors of
the Company within a three (3) year period, as a result of which fewer than a
majority of the directors are Incumbent Directors. "Incumbent Directors" shall
mean directors who either:

                           (a) are directors of the Company as of the date 
hereof;

                           (b) are elected, or nominated for election, to the 
Board of Directors of the Company with the affirmative votes of at least a
majority of the directors of the Company who are Incumbent Directors described
in (A) above at the time of such election or nomination; or



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                           (c) are elected, or nominated for election, to the 
Board of Directors of the Company with the affirmative votes of at least a
majority of the directors of the Company who are Incumbent Directors described
in (A) or (B) above at the time of such election or nomination.

         Notwithstanding the foregoing, "Incumbent Directors" shall not include
an individual whose election or nomination is in connection with an actual or
threatened proxy contest relating to the election of directors to the Company.

         6.5 "COMPANY" means VLSI Technology, Inc., a Delaware corporation, and
any successor thereto.

         6.6 "COVERED TERMINATION" means an Involuntary Termination or a
Voluntary Termination for Good Reason within twenty-four (24) months following a
Change in Control. No other event shall be a Covered Termination for purposes of
this Agreement.

         6.7 "INVOLUNTARY TERMINATION" means Executive's dismissal or discharge
by the Company (or, if applicable, by the successor entity) for reasons other
than fraud, misappropriation or embezzlement on the part of Executive which
resulted in material loss, damage or injury to the Company. Notwithstanding the
foregoing, Executive shall not be deemed to have been terminated for one of
these reasons, unless and until there shall have been delivered to Executive a
copy of a resolution, duly adopted by the affirmative vote of not less than
three-quarters of the entire membership of the Company's Board of Directors at a
meeting of the Board called and held for the purpose (after reasonable notice to
Executive and an opportunity for the Executive, together with Executive's
counsel, to be heard before the Board of Directors), finding that in the good
faith opinion of the Board of Directors, Executive was guilty of conduct set
forth in the immediately preceding sentence and specifying the particulars
thereof in detail.

         The termination of an Executive's employment would not be deemed to be
an "Involuntary Termination" if such termination occurs as a result of the death
or disability of Executive.

         6.8 "VOLUNTARY TERMINATION FOR GOOD REASON" means that the Executive
voluntarily terminates his employment after any of the following are undertaken
without Executive's express written consent:

                  (a) the assignment to Executive of any duties or
responsibilities which result in any diminution or adverse change of Executive's
position, status or 


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circumstances of employment as in effect immediately prior to a Change in
Control of the Company; a change in Executive's titles or offices as in effect
immediately prior to a Change in Control of the Company; any removal of
Executive from or any failure to reelect Executive to any of such positions,
except in connection with the termination of his employment for death,
disability, retirement, fraud, misappropriation, embezzlement or any other
voluntary termination of employment by Executive other than Voluntary
Termination for Good Reason;

                  (b) a reduction by the Company in Executive's Annual Base Pay;

                  (c) any failure by the Company to continue in effect any
benefit plan or arrangement, including incentive plans or plans to receive
securities of the Company, in which Executive is participating at the time of a
Change in Control of the Company (hereinafter referred to as "Benefit Plans"),
or the taking of any action by the Company which would adversely affect
Executive's participation in or reduce Executive's benefits under any Benefit
Plans or deprive Executive of any fringe benefit enjoyed by Executive at the
time of a Change in Control of the Company, provided, however, that Executive
may not terminate for Good Reason following a Change in Control of the Company
if the Company offers a range of benefit plans and programs which, taken as a
whole, are comparable to the Benefit Plans as determined in good faith by
Executive;

                  (d) a relocation of Executive, or the Company's principal
executive offices if Executive's principal office is at such offices, to a
location more than fifteen (15) miles from the location at which Executive
performed Executive's duties prior to a Change in Control of the Company, except
for required travel by Executive on the Company's business to an extent
substantially consistent with Executive's business travel obligations at the
time of a Change in Control of the Company;

                  (e) any breach by the Company of any provision of this 
agreement; or

                  (f) any failure by the Company to obtain the assumption of 
this agreement by any successor or assign of the Company.

         6.9 "WELFARE BENEFITS" means benefits providing for coverage or payment
in the event of Executive's death, disability, illness or injury that were
provided to Executive immediately before a Change in Control, whether taxable or
non-taxable and whether funded through insurance or otherwise.

                                   ARTICLE VII


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                               GENERAL PROVISIONS

         7.1 EMPLOYMENT STATUS. This Agreement does not constitute a contract of
employment or impose on Executive any obligation to remain as an employee, or
impose on the Company any obligation (i) to retain Executive as an employee,
(ii) to change the status of Executive as an at-will employee, or (iii) to
change the Company's policies regarding termination of employment.

         7.2 NOTICES. Any notices provided hereunder must be in writing and such
notices or any other written communication shall be deemed effective upon the
earlier of personal delivery (including personal delivery by telex or facsimile)
or the third day after mailing by first class mail, to the Company at its
primary office location and to Executive at his address as listed in the
Company's payroll records. Any payments made by the Company to Executive under
the terms of this Agreement shall be delivered to Executive either in person or
at his address as listed in the Company's payroll records.

         7.3 SEVERABILITY. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.

         7.4 WAIVER. If either party should waive any breach of any provisions
of this Agreement, he or it shall not thereby be deemed to have waived any
preceding or succeeding breach of the same or any other provision of this
Agreement.

         7.5 COMPLETE AGREEMENT. This Agreement, including Exhibit A and other
written agreements referred to in this Agreement, constitutes the entire
agreement between Executive and the Company and it is the complete, final, and
exclusive embodiment of their agreement with regard to this subject matter. It
is entered into without reliance on any promise or representation other than
those expressly contained herein.

         7.6 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement may be
changed or terminated only upon the mutual written consent of the Company and
Executive. The written consent of the Company to a change or termination of this
Agreement must be signed by an executive officer of the Company after such
change 




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or termination has been approved by the Compensation Committee of the Company's
Board of Directors.

         7.7 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more than one
party, but all of which taken together will constitute one and the same
Agreement.

         7.8 HEADINGS. The headings of the Articles and Sections hereof are
inserted for convenience only and shall not be deemed to constitute a part
hereof nor to affect the meaning thereof.

         7.9 SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and
inure to the benefit of and be enforceable by Executive and the Company, and
their respective successors, assigns, heirs, executors and administrators,
except that Executive may not assign any of his duties hereunder and he may not
assign any of his rights hereunder without the written consent of the Company,
which consent shall not be withheld unreasonably.

         7.10 ATTORNEY FEES. If Executive brings any action to enforce his
rights hereunder, Executive shall be entitled to recover his reasonable
attorneys' fees and costs incurred in connection with such action, regardless of
the outcome of such action.

         7.11 CHOICE OF LAW. All questions concerning the construction, validity
and interpretation of this Agreement will be governed by the law of the State of
California.

         7.12 NON-PUBLICATION. The parties mutually agree not to disclose
publicly the terms of this Agreement except to the extent that disclosure is
mandated by applicable law.

         7.13 CONSTRUCTION OF PLAN. In the event of a conflict between the text
of the Agreement and any summary, description or other information regarding the
Agreement, the text of the Agreement shall control.


         IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year written above.

VLSI TECHNOLOGY, INC.,
A DELAWARE CORPORATION




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By:
   -----------------------


Name:
     ---------------------             -----------------------
          [CEOOFFICER]                    [Executive Name2]
                                             [ExecTitle]

Title:
      ---------------------
           [TITLE]



Exhibit A: Employee Agreement and Release



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                                    EXHIBIT A
                         EMPLOYEE AGREEMENT AND RELEASE

         I UNDERSTAND AND AGREE COMPLETELY TO THE TERMS SET FORTH IN THE
FOREGOING AGREEMENT.

         I hereby confirm my obligations under the Company's standard form of
proprietary information agreement.

         I acknowledge that I have read and understand Section 1542 of the
California Civil Code which reads as follows: "A GENERAL RELEASE DOES NOT EXTEND
TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT
THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR." I hereby expressly waive and
relinquish all rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any claims I may
have against the Company.

         Except as otherwise set forth in this Agreement, I hereby release,
acquit and forever discharge the Company, its parents and subsidiaries, and
their officers, directors, agents, servants, employees, shareholders,
successors, assigns and affiliates, of and from any and all claims, liabilities,
demands, causes of action, costs, expenses, attorneys fees, damages, indemnities
and obligations of every kind and nature, in law, equity, or otherwise, known
and unknown, suspected and unsuspected, disclosed and undisclosed (other than
any claim for indemnification I may have as a result of any third party action
against me based on my employment with the Company), arising out of or in any
way related to agreements, events, acts or conduct at any time prior to and
including the Effective Date of this Agreement, including but not limited to:
all such claims and demands directly or indirectly arising out of or in any way
connected with my employment with the Company or the termination of that
employment, including but not limited to, claims of intentional and negligent
infliction of emotional distress, any and all tort claims for personal injury,
claims or demands related to salary, bonuses, commissions, stock, stock options,
or any other ownership interests in the Company, vacation pay, fringe benefits,
expense reimbursements, severance pay, or any other form of compensation; claims
pursuant to any federal, state or local law or cause of action including, but
not limited to, the federal Civil Rights Act of 1964, as amended; the federal
Age Discrimination in Employment Act of 1967, as amended ("ADEA"); the federal
Americans with Disabilities Act of 1990; the California Fair Employment and
Housing Act, as amended; tort law; contract law; wrongful discharge;
discrimination; fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that nothing in this
paragraph shall be construed in any way to release the Company from its
obligation to indemnify you pursuant to the Company's Indemnification Agreement.

         I acknowledge that I am knowingly and voluntarily waiving and releasing
any rights I may have under ADEA. I also acknowledge that the consideration
given for the waiver and release in the preceding paragraph hereof is in
addition to anything of value to which I was already entitled. I further
acknowledge that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or claims that may
arise after the Effective Date of this Agreement; (B) I have the right to
consult with an attorney prior to executing this Agreement; (C) I have
twenty-one (21) days to consider this Agreement (although I may choose to
voluntarily execute this Agreement earlier); (D) I have seven (7) days following
the execution of this Agreement by the parties to revoke the Agreement; and (E)
this Agreement shall not be effective until the date upon which the revocation
period has expired, which shall be the eighth day after this Agreement is



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executed by me, provided that the Company has also executed this Agreement by
that date ("Effective Date").



                                       By:
                                          ------------------------------
                                                  [ExecutiveName]



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