**Exhibit 10.31**
**Consulting Agreement**
     This Consulting Agreement (this “**Agreement**”) is being entered into on August 17, 2004 by andbetween Silicon Image, Inc., a Delaware corporation with its principal place of business at 1060East Arques Avenue, Sunnyvale, California 94085 (“**Company**”) and Robert G. Gargus (“**Consultant**”) andin connection with that certain Amended and Restated Employment Agreement, dated August 17, 2004 byand between the Company and the Consultant (“**Restated Employment Agreement**”). This Agreement willbecome effective as of the Separation Date, as defined in the Restated Employment Agreement (the“**Effective Date**”). As used herein, “**Party**” or “**Parties**” will refer to Company, Consultant or both,as the case may be and Consultant includes the Consultant, and all employees and agents of theConsultant.
**RECITALS**
Whereas, Consultant and Company have entered into the Restated Employment Agreement,pursuant to which Consultant has agreed to provide the Company with certain consulting services asof the Effective Date; and
Whereas, Consultant desires to perform, and Company desires to have Consultant perform,consulting services as an independent contractor to Company.
NOW, THEREFORE, the Parties agree as follows:
1. **Services**
     1.1 Performance. Consultant will perform the following consulting “**Services**”: (a)provide transition assistance to the Company’s Chief Executive Officer and Chief Financial Officerand (b) at any point in time following the Separation Date, to assist as reasonably necessary theCompany with any reviews, investigations or examinations of the Company’s financial and accountingresults, policies, practices and other matters during your period of employment with the Company.In addition, Consultant agrees to use all diligent and reasonable efforts to perform the Servicesduring the Period of Consultancy.
     1.2 Period of Consultancy. The “Period of Consultancy” will commence on the EffectiveDate and will terminate six (6) months following the Effective Date.
     1.3 Payment. The Company will, as sole compensation for the Consultant’s performanceof the Services grant Consultant the Accelerated Vesting (as defined in the Restated EmploymentAgreement) upon the Separation Date (as defined in the Restated Employment Agreement). Company willalso reimburse Consultant for his reasonable out-of-pocket expenses incurred in performing theServices that are approved in advance by Company’s Chief Executive Officer or Chief FinancialOfficer. Consultant will invoice Company on a monthly basis for such out-of-pocket expenses andCompany will pay each such invoice no later than thirty (30) days after its receipt. Consultantwill receive no other
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compensation or remuneration in connection with or based upon the Services.
**2. Relationship of the Parties**
     2.1 Independent Contractor. Consultant is an independent contractor and is not anagent or employee of, and has no authority to bind, Company by contract or otherwise. Consultantwill perform the Services under the general direction of Company, but Consultant will determine, inConsultant’s sole discretion, the manner and means by which the Services are accomplished, subjectto the requirement that Consultant shall at all times comply with applicable law.
     2.2 Employment Benefits. Except as set forth in paragraph 3 of the Restated EmploymentAgreement, Consultant will not be entitled to receive any vacation or illness payments, or toparticipate in any plans, arrangements, or distributions by the Company pertaining to any bonus,stock option, profit sharing, insurance or similar benefits for Company’s employees.
**3. Confidential Information**Consultant acknowledges that Consultant will acquire information andmaterials from Company and knowledge about the business, products, customers, clients and suppliersof Company and that all such knowledge, information and materials acquired, and the existence,terms and conditions of this Agreement, are and will be the trade secrets and confidential andproprietary information of Company (collectively “**Confidential Information**”). ConfidentialInformation will not include, however, any information that is or becomes part of the public domainthrough no fault of Consultant or that Company regularly gives to third parties without restrictionon use or disclosure. Consultant agrees to hold all such Confidential Information in strictconfidence, not to disclose it to others or use it in any way, commercially or otherwise, except inperforming the Services, and not to allow any unauthorized person access to it, either before orafter expiration or termination of this Agreement. Consultant further agrees to take all actionreasonably necessary and satisfactory to protect the confidentiality of the ConfidentialInformation including, without limitation, implementing and enforcing operating procedures tominimize the possibility of unauthorized use or copying of the Confidential Information.
**4. Termination and Expiration**
     4.1 Termination. Either party may terminate this Agreement in the event of a breach bythe other party if such breach continues uncured for a period of ten (10) days after writtennotice.
     4.2 Expiration. Unless terminated earlier, this Agreement will expire at the end ofthe Period of Consultancy.
     4.3 No Election of Remedies. The election by Company to terminate this Agreement inaccordance with its terms shall not be deemed an election of remedies, and all other remediesprovided by this Agreement or available at law or in equity shall survive any termination.
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**5. Effect of Expiration or Termination**
Upon the expiration or termination of this Agreement for any reason:
 a)  each party will be released from all obligations to the otherarising after the date of expiration or termination, except that expiration ortermination of this Agreement for any reason will not relieve Company of itsobligations under Sections 1.3, 6 and 8 nor will this release indemnificationobligations with respect to any claims (including coverage of attorneys’ feesand costs for Employee’s individual representation) arising under Consultant’sexisting rights to indemnification and defense pursuant to the articles andbylaws of the Company for acts as a director and/or officer or to Consultant’srights of insurance under any director and officer liability policy in effectcovering the Company’s directors and officers or Consultant’s rights underCalifornia Labor Code section 2802 or Consultant of its obligations underSections 2.2, 3, 6 and 8 nor will expiration or termination relieve Consultantor Company from any liability arising from any breach of this Agreement; and  b)  upon the Company’s reasonable request, Consultant will promptlynotify Company of all Confidential Information in Consultant’s possession and,at the expense of Consultant and in accordance with Company’s instruction, willpromptly deliver to Company all such Confidential Information.
**6. Limitation of Liability**
IN NO EVENTSHALL COMPANY OR CONSULTANT BE LIABLE FOR ANY SPECIAL, INCIDENTAL,INDIRECT OR CONSEQUENTIAL DAMAGES OF ANY KIND IN CONNECTION WITH THISAGREEMENT, EVEN IF COMPANY OR CONSULTANT HAS BEEN INFORMED IN ADVANCE OF THEPOSSIBILITY OF SUCH DAMAGES.
**7. Competitive Activities**
Consultant will not during the term of this Agreement, directly or indirectly, in any individual orrepresentative capacity, engage or participate in or provide services to any business whose primarybusiness is directly competitive with Company.
**8. General**
     8.1 Assignment. Consultant may not assign Consultant’s rights or delegate Consultant’sduties under this Agreement either in whole or in part without the prior written consent ofCompany. Any attempted assignment or delegation without such consent will be void.
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     8.2 Attorneys’ Fees. If any action is necessary to enforce the terms of thisAgreement, the substantially prevailing party will be entitled to reasonable attorney’s fees, costsand expenses in addition to any other relief to which such prevailing party may be entitled.
     8.3 Governing Law Severability. This Agreement will be governed by and construed inaccordance with the laws of the State of California excluding that body of law pertaining toconflict of laws. If any provision of this Agreement is for any reason found to be unenforceable,the remainder of this Agreement will continue in full force and effect.
     8.4 Notices. Any notices under this Agreement will be sent by certified or registeredmail, return receipt requested, to the address specified below or such other address as the partyspecifies in writing. Such notice will be effective upon its mailing as specified.
     8.5 Complete Understanding; Modifications. This Agreement, together with the RestatedEmployment Agreement between the parties of even date herewith, constitutes the complete andexclusive understanding and agreement of the parties and supersedes all prior understandings andagreements, whether written or oral, with respect to the subject matter hereof and thereof. Anywaiver, modification or amendment of any provision of this Agreement will be effective only if inwriting and signed by the parties hereto.
IN WITNESS WHEREOF, the parties have executed this Agreement as of August 17, 2004.       **COMPANY**   **CONSULTANT**       By: /s/ David D. Lee   /s/ Robert G. Gargus             Name: David D. Lee   Robert G. Gargus             Title: CEO and Chairman of the Board                 Date: 8/17/04   8/17/04             Address:                        
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