##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
     Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2007Oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number
    000-31803
     Transmeta Corporation
 (Exact Name of Registrant as
    Specified in Its Charter)
  Delaware

77-0402448(State of
    Incorporation)

(IRS Employer Identification
    No.)   2540 Mission College Boulevard, Santa Clara, CA 95054
 (Address of Principal Executive
    Offices, Including Zip Code)
  (408) 919-3000
 (Registrants Telephone
    Number, Including Area Code)
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, par value $0.00001 per share

NASDAQ Global MarketPreferred Stock Purchase Rights

NASDAQ Global Market   Securities registered pursuant to Section 12(g) of the
    Act: None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller reporting
    company o (Do not check if a smaller
    reporting company)
  Rule 12b-2 o þ
      DOCUMENTS INCORPORATED BY
    REFERENCE
  10-K,




---



##### 





TRANSMETA
    CORPORATION
  FISCAL YEAR
    2007
    FORM 10-K
  INDEX
  Item



PageCaution Regarding Forward-Looking Statements


2PART IItem 1.


Business


3Item 1A.


Risk Factors


7Item 1B.


Unresolved Staff Comments


14Item 2.


Properties


14Item 3.


Legal Proceedings


14Item 4.


Submission of Matters to a Vote of Security
    Holders


16PART IIItem 5.


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


17Item 6.


Selected Financial Data


18Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


19Item 7A.


Quantitative and Qualitative Disclosures About
    Market Risk


35Item 8.


Financial Statements and Supplementary Data


36Item 9.


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


78Item 9A.


Controls and Procedures


78Item 9B.


Other Information


80PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance


80Item 11.


Executive Compensation


80Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and
    Related Stockholder Matters


80Item 13.


Certain Relationships and Related Transactions,
    and Director Independence


80Item 14.


Principal Accountant Fees and Services


80PART IVItem 15.


Exhibits and Financial Statement Schedules


81SIGNATURES


82POWER OF ATTORNEY


83INDEX TO EXHIBITS


84EXHIBIT 10.37EXHIBIT 10.38EXHIBIT 23.01EXHIBIT 31.01EXHIBIT 31.02EXHIBIT 32.01EXHIBIT 32.02     (408) 919-3000. ® ® ® ® tm ® tm
 1




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##### Table of Contents



CAUTION
    REGARDING FORWARD-LOOKING STATEMENTS  Form 10-K
   PART I    Accounting Principles Board opinion

APB OpinionBlack-Scholes-Merton valuation model

BSM modelFASB Emerging Issues Task Force issue

EITF IssueFASB Interpretation

FINFASB Staff Accounting Position

FSPFinancial Accounting Standards Board

FASBSEC Staff Accounting Bulletin

SABSecurities and Exchange Commission

SEC     Advanced Micro Devices, Inc.

AMDAdvanced Semiconductor Engineering

ASEFujitsu Limited

FujitsuHewlett-Packard International Pte Inc.

HPIBM Corporation

IBMIntel Corporation

IntelMicrosoft Corporation

MicrosoftNEC Electronics

NECSeiko Epson Corporation

EpsonSony Corporation

SonyToshiba Corporation

Toshiba  2




---



##### Table of Contents



Item 1.
    Business  General
  tm
        Our
    Licensing Business
       3




---



##### Table of Contents




    post-manufacturing correction of process variation
    optimal control of transistor leakage
    reduction of active and standby power
    patented area-saving interconnect technology    Our
    Services Business
      Our
    Product Business
  ® tm
  Manufacturing
   4




---



##### Table of Contents



Customers
    and Concentration
              Competition
    
    technical innovation;
    performance of our technology;
    compatibility with other semiconductor design, materials and
    manufacturing choices by current and prospective licensees;
    sufficient technical personnel available to provide relevant
    services and technical support; and
    reputation and branding.   5




---



##### Table of Contents



Intellectual
    Property
       6




---



##### Table of Contents



Employees
    Available
    Information
  www.transmeta.com Form 10-K, Form 10-Q, Form 8-K, 1-800-SEC-0330. www.sec.gov.
  Item 1A.
    Risk
    Factors  The factors discussed below are cautionary statements that
    identify important risk factors that could cause actual results
    to differ materially from those anticipated in the
    forward-looking statements in this Annual Report on
    Form 10-K.
    If any of the following risks actually occurs, our business,
    financial condition and results of operations would suffer. In
    this case, the trading price of our common stock could decline
    and investors might lose all or part of their investment in our
    common stock.
  We
    have a history of losses, and we must successfully execute our
    current business plan if we are to sustain our
    operations.
      We
    substantially restructured our operations and changed our
    business plan in 2007, and we might fail to operate successfully
    under our current business plan.
   7




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##### Table of Contents



We
    might lose key technical or management personnel, on whose
    knowledge, leadership and technical expertise we rely. Such
    losses could prevent us from operating successfully under our
    current business plan.
    Our
    recent restructuring and the evolution of our business could
    place significant strain on our management systems,
    infrastructure and other resources, and our business may not
    succeed if we fail to manage such changes
    effectively.
    Our
    current business plan depends on increasing our LongRun2
    licensing revenue, and we might be unsuccessful in our efforts
    to license our LongRun2 technology to other
    parties.
    We
    have limited visibility regarding when and to what extent our
    licensees will use our LongRun2 or other licensed technologies,
    and we might be unsuccessful in our efforts to generate royalty
    revenue.
   8




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##### Table of Contents




    the competition that our licensees face and the market
    acceptance of their products;
    the pricing policies of our licensees for their products
    incorporating our technology;
    the engineering, marketing and management capabilities of our
    licensees and technical challenges unrelated to our technology
    that they face in developing their products; and
    the financial and other resources of our licensees.    We
    face intense competition in the development of advanced
    technologies. Our customers and competitors are much larger than
    we are and have significantly greater resources. We may not be
    able to compete effectively.
    We
    might be unable to keep pace with technological change in our
    industry, and our technology offerings might not be
    competitive.
    We
    might experience payment disputes for amounts owed to us under
    our LongRun2 licensing agreements, and such a dispute may harm
    our business results.
   9




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##### Table of Contents



We
    might experience payment disputes for amounts owed to us under
    our settlement agreement with Intel, and such a dispute may harm
    our financial and operational outlook.
    We
    currently derive a substantial portion of our revenue from a
    small number of customers and licensees, and our operating
    results would be adversely affected if any customer were to
    cancel, reduce or delay a transaction.
      We may
    be unable to protect our proprietary technologies and defend our
    intellectual property rights. Our competitors might gain access
    to our technologies, and we might not compete successfully in
    our markets.
     10




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##### Table of Contents



Any
    dispute regarding our intellectual property may require us to
    indemnify certain licensees or third parties, the cost of which
    could severely hamper our business operations and financial
    condition.
    We
    have significant international business relationships, which
    expose us to risk and uncertainties.
    
    difficulties and costs of servicing international customers;
    fluctuations in currency exchange rates;
    unexpected changes in regulatory requirements, including
    imposition of currency exchange controls;
    longer accounts receivable collection cycles;
    import or export licensing requirements;
    potentially adverse tax consequences;
    political and economic instability; and
    potentially reduced protection for intellectual property rights.  Our
    operating results are difficult to predict and fluctuate
    significantly. A failure to meet the expectations of investors
    could result in a substantial decline in our stock
    price.
    A sale
    of a substantial number of shares of our common stock may cause
    the price of our common stock to decline.
   11




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##### Table of Contents



The
    price of our common stock has been volatile and is subject to
    wide fluctuations.
    
    variations in our quarterly results;
    market conditions in our industry, the industries of our
    customers and the economy as a whole;
    announcements of technological innovations by us or by our
    competitors;
    introductions of new products or new pricing policies by us or
    by our competitors;
    acquisitions or strategic alliances by us or by our competitors;
    recruitment or departure of key personnel;
    the gain or loss of significant customers; and
    changes in the estimates of our operating performance or changes
    in recommendations by securities analysts.      We
    might need to raise additional financing, which might not be
    available or might be available only on terms unfavorable to us
    or our stockholders.
    
    fund expansion;
    develop or enhance our products or technologies;
    enhance our operating infrastructure;
    respond to competitive pressures; or
    acquire complementary businesses or technologies.   12




---



##### Table of Contents



Our
    certificate of incorporation and bylaws, stockholder rights plan
    and Delaware law contain provisions that could discourage or
    prevent a takeover, even if an acquisition would be beneficial
    to our stockholders.
    
    establishing a classified board of directors so that not all
    members of our board may be elected at one time;
    providing that directors may be removed only for
    cause and only with the vote of
    662/3%
    of our outstanding shares;
    requiring super-majority voting to amend some provisions in our
    certificate of incorporation and bylaws;
    authorizing the issuance of blank check preferred
    stock that our board could issue to increase the number of
    shares outstanding and to discourage a takeover attempt;
    limiting the ability of our stockholders to call special
    meetings of stockholders;
    prohibiting stockholder action by written consent, which
    requires all stockholder actions to be taken at a meeting of our
    stockholders; and
    establishing advance notice requirements for nominations for
    election to our board or for proposals that can be acted upon by
    stockholders at stockholder meetings.    Our
    business is subject to potential tax liabilities, which could
    change our effective tax rate.
      
    the jurisdictions in which profits are determined to be earned
    and taxed;
    the resolution of issues arising from tax audits with various
    tax authorities;
    adjustments to deferred tax assets utilized in 2007 to reduce
    the tax effect of various tax returns;
    adjustments to estimated taxes upon finalization of various tax
    returns;
    increases in expenses not deductible for tax purposes;
    changes in available tax credits and available net operating
    loss carryovers;
    changes in the valuation of any deferred tax assets and
    liabilities;
    changes in share-based compensation; or
    changes in tax laws or the interpretation of such tax laws and
    changes in generally accepted accounting principles. 13




---



##### Table of Contents



Our
    results of operations could vary as a result of the methods,
    estimates, and judgments we use in applying our accounting
    policies.
  Form 10-K).
  We may
    develop or identify material weaknesses in our internal control
    over financial reporting.
    Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties      Item 3.
    Legal
    Proceedings   14




---



##### Table of Contents



In re Transmeta Corporation Initial
    Public Offering Securities Litigation 1999-2000. In
    re Initial Public Offering Securities Litigation
   15




---



##### Table of Contents



Simmonds v. Morgan Stanley, et al. No. C07-1636
  Riley Investment Partners
    Investment Fund, L.P., et al. v. Horsley, et al. (Transmeta
    Corp.), No. 1:08-CV-104667.
  Item 4.
    Submission
    of Matters to a Vote of Security Holders   16




---



##### Table of Contents



PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities  Market
    Information for Common Stock
    High


LowFiscal year ended December 31, 2006First quarter

$
43.60


$
22.60Second quarter


47.40



26.00Third quarter


33.60



21.40Fourth quarter


26.80



21.80Fiscal year ended December 31, 2007First quarter

$
22.80


$
11.00Second quarter


15.20



5.60Third quarter


20.80



5.68Fourth quarter


15.70



4.10   Stockholders
    Dividends
    Securities
    Authorized For Issuance Under Equity Compensation
    Plans
    Company
    Stock Price Performance
  Form 10-K
 17




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##### Table of Contents



COMPARISON
    OF 5 YEAR CUMULATIVE TOTAL RETURN
    
    *
    
    $100 invested on 12/31/02 in stock or index-including
    reinvestment of dividends. Fiscal year ending December 31.  Item 6.
    Selected
    Financial Data   18




---



##### Table of Contents



Years Ended December 31,2007


2006


2005


2004


2003(In thousands, except for per share data)Consolidated Statement of Operations Data:Total revenue

$
2,480


$
48,550


$
72,731


$
29,444


$
17,315Gross profit (loss)


789



24,344



44,399



(9,564
)


991Net income (loss)


(63,182
)


(23,498
)


(6,181
)


(106,798
)


(87,636
)Deemed dividend for beneficial conversion feature of preferred
    stock


(3,630
)














Net income (loss) attributable to common shareholders

$
(66,812
)

$
(23,498
)

$
(6,181
)

$
(106,798
)

$
(87,636
)Net income (loss) per share attributable to common
    shareholders  basic

$
(6.33
)

$
(2.40
)

$
(0.65
)

$
(12.14
)

$
(12.55
)Net income (loss) per share attributable to common
    shareholders fully diluted

$
(6.33
)

$
(2.40
)

$
(0.65
)

$
(12.14
)

$
(12.55
)   December 31,2007


2006


2005


2004


2003(In thousands)Consolidated Balance Sheet Data:Cash, cash equivalents and short-term investments

$
18,575


$
41,550


$
56,470


$
53,668


$
120,765Working capital


124,869



32,864



38,791



40,661



99,290Total assets


259,286



56,729



79,314



89,613



171,590Long-term liabilities, net of current portion


211,940



2,321



2,453



8,688



4,511Total stockholders equity


1,601



42,683



54,952



58,000



131,418   Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  The following discussion and analysis of the financial
    condition and results of our operations should be read in
    conjunction with the consolidated financial statements and
    related notes included elsewhere in this Annual Report on Form
    10-K. This
    discussion contains forward-looking statements that involve
    risks and uncertainties. Our actual results could differ
    materially from those discussed below. Factors that could cause
    or contribute to such differences include, but are not limited
    to, those identified below, and those discussed in the section
    titled Risk Factors included in Item 1A of this
    Annual Report on
    Form 10-K.
  Overview
  tm
   19




---



##### Table of Contents



2007
    Results
            Operating
    Gain on Intel Litigation Settlement
     20




---



##### Table of Contents



Operating Gain


Interest IncomeYears

Recognized


Recognized(In thousands)2007

$



$
2008


23,460



5,2242009


23,460



3,8822010


23,460



3,0082011


23,460



2,0852012


23,460



1,1132013


23,460



882014


23,460



2015


23,460



2016


23,460



2017


23,460



Total

$
234,600


$
15,400  21




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##### Table of Contents



Results
    of Operations
    Years Ended December 31,2007


2006


2005(Percentages of Total Revenue)Revenue:Product


7
%


3
%


34
%License


4
%


21
%


27
%Service


89
%


76
%


39
%Total revenue


100
%


100
%


100
%Cost of revenue:Product(*)


3
%


1
%


17
%License


0
%


0
%


0
%Service(*)


50
%


45
%


22
%Impairment charge on inventories


15
%


4
%


0
%Total cost of revenue


68
%


50
%


39
%Gross profit


32
%


50
%


61
%Operating expenses:Research and development(*)


435
%


41
%


27
%Selling, general and administrative(*)


1415
%


44
%


32
%Restructuring charges, net(*)


358
%


2
%


3
%Amortization of patents and patent rights


276
%


14
%


9
%Impairment charge on long-lived and other assets


12
%


2
%


0
%Total operating expenses


2496
%


103
%


71
%Operating (loss) income


(2464
)%


(53
)%


(10
)%Interest income and other, net


50
%


5
%


2
%Interest expense


0
%


0
%


0
%Income (loss) before income taxes


(2414
)%


(48
)%


(8
)%Provision for Income taxes


133
%


0
%


0
%Net income (loss)


(2547
)%


(48
)%


(8
)%Deemed dividend for beneficial conversion feature of
    preferred stock


(146
)%


0
%


0
%Net income (loss) attributable to common shareholders


(2693
)%


(48
)%


(8
)%(*) Includes stock-based compensation:Cost of product revenue


0
%


0
%


0
%Cost of service revenue


1
%


4
%


0
%Research and development


14
%


3
%


0
%Selling, general and administrative


52
%


5
%


0
%Restructuring charges, net


0
%


0
%


0
%   Total
    Revenue
   22




---



##### Table of Contents



Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Product

$
167


$
1,673


$
24,636



(90.0
)%


(93.2
)%License


103



10,000



19,628



(99.0
)%


(49.1
)%Service


2,210



36,877



28,467



(94.0
)%


29.5
%Total revenue

$
2,480


$
48,550


$
72,731



(94.9
)%


(33.2
)%     Product Revenues.
  License Revenue.
      Service Revenue.
  Customer
    Concentration Information
   23




---



##### Table of Contents



Costs
    of Revenue
    Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Product(*)

$
80


$
303


$
12,271



(73.6
)%


(97.5
)%License






39



71



(100.0
)%


(45.1
)%Service(*)


1,247



22,062



15,990



(94.3
)%


38.0
%Impairment charges on inventories


364



1,802







(79.8
)%


n/aTotal cost of revenue

$
1,691


$
24,206


$
28,332



(93.0
)%


(14.6
)%(*) Includes stock-based compensation:Cost of product revenue

$



$
9


$




(100.0
)%


n/aCost of service revenue

$
19


$
1,789


$




(98.9
)%


n/a   Cost of
    Product Revenue
      Cost of
    License Revenue
    Cost of
    Service Revenue
       24




---



##### Table of Contents



Impairment
    charges on inventories
    Research
    and Development
  Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Research and development expenses

$
10,451


$
18,397


$
19,609



(43.2
)%


(6.2
)%Stock-based compensation


339



1,723







(80.3
)%


n/aTotal Research and development expenses

$
10,790


$
20,120


$
19,609



(46.4
)%


2.6
%   Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Amount classified to costs of service and deferred costs

$
1,193


$
14,532


$
17,737



(91.8
)%


(18.1
)%Stock-based compensation for service cost of revenue


19



1,789







(98.9
)%


n/aTotal amount classified to cost of service and deferred cost(1)

$
1,212


$
16,321


$
17,737



(92.6
)%


(8.0
)%     (1)
    
    In fiscal 2007, 2006 and 2005, we included cost directly
    attributable to the design and development services agreements
    in cost of service revenues. Prior to 2005, such cost were
    included in the research and development activities as the
    employees involved with such activities were performing research
    and development related activities in the prior years.     25




---



##### Table of Contents



Selling,
    General and Administrative
  Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Selling, general and administrative expenses

$
33,809


$
19,219


$
23,039



75.9%



(16.6
)%Stock-based compensation


1,284



2,253







(43.0
)%


n/aTotal selling, general and administrative expenses

$
35,093


$
21,472


$
23,039



63.4%



(6.8
)%       Restructuring
    Charges
  Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Restructuring Charges

$
8,879


$
876


$
2,033



913.6%



(56.9
)%      26




---



##### Table of Contents



Excess


WorkforceFacilities


Reduction


Total(In thousands)Balance as of December 31, 2004

$
5,245


$



$
5,245Restructuring charges


1,899



1,502



3,401Adjustments and reversals


(1,278
)


(90
)


(1,368
)Cash drawdowns


(1,610
)


(1,412
)


(3,022
)Balance as of December 31, 2005

$
4,256


$



$
4,256Restructuring charges


551







551Change in estimates


325







325Cash drawdowns


(2,148
)






(2,148
)Balance as of December 31, 2006

$
2,984


$



$
2,984Restructuring charges


1,537



7,104



8,641Change in estimates


238







238Cash drawdowns


(3,222
)


(7,049
)


(10,271
)Balance as of December 31, 2007

$
1,537


$
55


$
1,592           Amortization
    of Patents and Patent Rights
  Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Amortization of patent and patent rights

$
6,846


$
6,846


$
6,846



0.0%



0.0%  27




---



##### Table of Contents



Impairment
    Charge on Long-Lived and Other Assets
  Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Impairment charge on long-lived and other assets

$
302


$
800


$




(62.3
)%


n/a     Interest
    Income and Other, Net
  Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Interest income and other, net

$
1,247


$
2,456


$
1,421



(49.2
)%


72.8%       Interest
    Expense
  Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Interest expense

$



$
(98
)

$
(306
)


(100.0
)%


(68.0
)%       Provision
    for income taxes
  Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Provision for income taxes

$
3,308


$
86


$
168



3746.5%



(48.8
)%    28




---



##### Table of Contents



Liquidity
    and Capital Resources
        Years Ended December 31,


% Change


% Change2007


2006


2005


2007 to 2006


2006 to 2005(In thousands)Net cash provided by (used in) operating activities

$
(43,521
)

$
(19,933
)

$
5,588



118.3
%


(456.7
)%Net cash provided by (used in) investing activities


27,169



(1,457
)


1,917



(1964.7
)%


(176.0
)%Net cash provided by financing activities


20,364



5,326



2,881



282.4
%


84.9
%Increase (decrease) in cash and cash equivalents

$
4,012


$
(16,064
)

$
10,386



(125.0
)%


(254.7
)%   Operating
    activities
       29




---



##### Table of Contents



Investing
    activities
      for-sale
  for-sale
  Financing
    activities
      Contractual
    Obligations
    Future Minimum Payments Due by PeriodTotal


Less Than 1 Year


1-3 Years


After 4 Years(In thousands)Operating leases(1)

$
2,047


$
2,047


$



$
Unconditional contractual obligations(2)


1,467



667



800



Total

$
3,514


$
2,714


$
800


$
     (1)
    
    Operating leases include agreements of building facilities less
    fiscal 2008 sublease income of $339,000(2)
    
    Contractual obligations include agreements to purchase goods or
    services that are enforceable and legally binding on us that
    specify all significant terms, including: fixed or minimum
    quantities to be purchased; fixed, minimum or variable price
    provisions; and the approximate timing of the transaction.
    Contractual obligations also include agreements for design tools
    and software for use in product development. 30




---



##### Table of Contents



Off-Balance
    Sheet Arrangements
  Regulation S-K.
  Critical
    Accounting Policies and Estimates
      
    license and related service revenue recognition;
    operating gain on Intel litigation settlement
    stock-based compensation
    valuation of long-lived and intangible assets;
    restructuring charges; and
    income taxes.  License and Related Service Revenue
    Recognition. No. 00-21, Revenue Arrangements with Multiple
    Deliverables Revenue Recognition agreed-upon
  Operating Gain on Intel Litigation
    Settlement. , Interest on
    Receivables and Payables,
 31




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##### Table of Contents



December 31,2007Intel litigation settlement receivable and deferred operating
    gain

Asset


Liability(In thousands)Non-interest bearing note, consisting of initial
    $150 million payment (Jan 2008) and
    5 x $20 million (Jan 2009-Jan 2013)

$
250,000


$
250,000   Face amount


Rate


DiscountLIBOR 1 mo rate

$
150,000



4.70
%

$
600AAA corp bond rate


100,000



5.41
%


14,800Less unamortized discount














(15,400
)


(15,400
)Total Intel settlement present value as of Dec. 31, 2007













$
234,600


$
234,600Other receivables, current














149,400Other receivables, long-term














85,200Total Intel settlement receivable, as of Dec. 31, 2007













$
234,600Deferred operating gain, current portion


















23,460Deferred operating gain, long-term


















211,140Total Intel settlement deferred operating gain, as of Dec. 31,
    2007

















$
234,600     Stock-Based Compensation. Share-Based
    Payment
   32




---



##### Table of Contents



Transition Election Related
    to Accounting for Tax Effects of Share-Based Payment
    Awards.
  Valuation of Long-Lived and Intangible
    Assets.
 33




---



##### Table of Contents



Restructuring Charges. No. 94-3, Liability Recognition for Certain Employee Termination
    Benefits and Other Costs to Exit an Activity (including Certain
    Costs Incurred in a Restructuring
  Accounting
    for Costs Associated with Exit or Disposal Activities
  Income Taxes.
      Accounting for
    Uncertainty in Income Taxes  an Interpretation of
    FASB Statement No. 109
 34




---



##### Table of Contents



Recent
    Accounting Pronouncements
    Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk  Interest Rate Risk.
    2007


2008


Thereafter


Total


Fair ValueCash equivalents

$
1,326


$
14,281


$



$
15,607


$
15,607Average rate


3.40
%


5.20
%Short term investments

$



$
3,000


$



$
3,000


$
2,968Average rate






5.16
%     Foreign Currency Exchange Risk.
 35




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##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data  INDEX TO
    CONSOLIDATED FINANCIAL STATEMENTS
    PageReport of Burr, Pilger & Mayer LLP,
    Independent Registered Public Accounting Firm


37Consolidated Balance Sheets


38Consolidated Statements of Operations


39Consolidated Statements of Stockholders
    Equity


40Consolidated Statements of Cash Flows


41Notes to Consolidated Financial Statements


42  36




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM              /s/ Burr,
    Pilger & Mayer LLP
    37




---



##### Table of Contents



TRANSMETA
    CORPORATION



CONSOLIDATED
    BALANCE SHEETS  December 31,2007


2006(In thousands,except for share data)ASSETSCurrent assets:Cash and cash equivalents

$
15,607


$
11,595Short-term investments


2,968



29,955Accounts receivable


163



310Other receivables, current


149,400



Prepaid expenses and other current assets


2,476



2,729Total current assets


170,614



44,589Other receivables, long-term


85,200



Property and equipment, net


284



758Patents and patent rights, net


2,388



9,234Other assets


800



2,148Total assets

$
259,286


$
56,729LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable

$
341


$
1,467Accrued compensation


15,351



3,245Deferred income, net






15Income taxes payable


3,306



49Other accrued liabilities


1,028



2,966Current portion of deferred operating gain


23,460



Advance from customers






1,320Current portion of accrued restructuring costs


1,592



1,996Current portion of long-term payable


667



667Total current liabilities


45,745



11,725Long-term deferred operating gain, net of current portion


211,140



Long-term accrued restructuring costs, net of current portion






988Long-term payables, net of current portion


800



1,333Total liabilities


257,685



14,046Commitments and contingencies (Notes 9 and 10)Stockholders equity:Convertible preferred stock, $0.00001 par value, at amounts


6,966



paid in; Authorized shares  5,000,000. Issued and
    outstanding shares  1,000,000 (2007) and none
    (2006); Liquidation preference: $7.5 million
    (2007) and none (2006)Common stock, $0.00001 par value, at amounts paid in;


739,268



724,229Authorized shares  50,000,000. Issued and outstanding
    shares  12,021,388 (2007) and 9,893,820 (2006)Treasury stock  39,843 shares in 2007 and 2006


(2,439
)


(2,439
)Accumulated other comprehensive gain (loss)


29



(66
)Accumulated deficit


(742,223
)


(679,041
)Total stockholders equity


1,601



42,683Total liabilities and stockholders equity

$
259,286


$
56,729    38




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##### Table of Contents



TRANSMETA
    CORPORATION



CONSOLIDATED
    STATEMENTS OF OPERATIONS  Years Ended December 31,2007


2006


2005(In thousands, except for per share data)Revenue:Product

$
167


$
1,673


$
24,636License


103



10,000



19,628Service


2,210



36,877



28,467Total revenue


2,480



48,550



72,731Cost of revenue:Product(*)


80



303



12,271License






39



71Service(*)


1,247



22,062



15,990Impairment charge on inventories


364



1,802



Total cost of revenue


1,691



24,206



28,332Gross profit


789



24,344



44,399Operating expenses:Research and development(*)


10,790



20,120



19,609Selling, general and administrative(*)


35,093



21,472



23,039Restructuring charges, net(*)


8,879



876



2,033Amortization of patents and patent rights


6,846



6,846



6,846Impairment charge on long-lived assets and other assets


302



800



Total operating expenses


61,910



50,114



51,527Operating loss


(61,121
)


(25,770
)


(7,128
)Interest income and other, net


1,247



2,456



1,421Interest expense






(98
)


(306
)Income (loss) before income taxes


(59,874
)


(23,412
)


(6,013
)Provision for income taxes


3,308



86



168Net income (loss)


(63,182
)


(23,498
)


(6,181
)Deemed dividend for beneficial conversion feature of preferred
    stock


(3,630
)






Net income (loss) attributable to common shareholders

$
(66,812
)

$
(23,498
)

$
(6,181
)Net income (loss) per share attributable to common
    shareholders  basic

$
(6.33
)

$
(2.40
)

$
(0.65
)Net income (loss) per share attributable to common
    shareholders  fully diluted

$
(6.33
)

$
(2.40
)

$
(0.65
)Weighted average shares outstanding  basic


10,559



9,792



9,520Weighted average shares outstanding   diluted


10,559



9,792



9,520(*) Includes stock-based compensation:Cost of product revenue

$



$
9


$
Cost of service revenue


19



1,789



Research and development


339



1,723



Selling, general and administrative


1,284



2,253



Restructuring charges, net










(34
)    39




---



##### Table of Contents



TRANSMETA
    CORPORATION



CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY  Preferred


Common Stock





AccumulatedShares of


Stock


& Warrants





Other





TotalCommon


at Amounts


at Amounts


Treasury


Comprehensive


Accumulated


StockholdersStock


Paid-in


Paid-in


Stock


Income/(Loss)


Deficit


Equity(In thousand of dollars, except share numbers)Balance at December 31, 2004


9,388,665


$



$
709,926


$
(2,439
)

$
(125
)

$
(649,362
)

$
58,000Issuance of shares of common stock to employees under option
    exercises and employee stock purchase plan, net of repurchases


196,866







3,237















3,237Variable stock compensation










(34
)














(34
)Other comprehensive income


















(70
)






(70
)Net loss






















(6,181
)


(6,181
)Comprehensive loss


























(6,251
)Balance at December 31, 2005


9,585,531







713,129



(2,439
)


(195
)


(655,543
)


54,952Issuance of shares of common stock to employees under option
    exercises and employee stock purchase plan, net of repurchases


308,289







5,326















5,326Stock-based compensation










5,774















5,774Other comprehensive income


















129







129Net loss






















(23,498
)


(23,498
)Comprehensive loss


























(23,369
)Balance at December 31, 2006


9,893,820







724,229



(2,439
)


(66
)


(679,041
)


42,683Issuance of 1,000,000 shares of preferred stock in private
    placement, net of issuance cost of $534






6,966



















6,966Beneficial conversion feature of preferred stock










3,630















3,630Deemed dividend for preferred stocks beneficial conversion
    feature










(3,630
)














(3,630
)Issuance of common stock and warrants in direct placement
    offering, net of issuance cost of $1,229


2,000,000







11,571















11,571Refund of 123.4 fractional shares due to reverse stock split


(123
)






(1
)














(1
)Issuance of shares of common stock to employees under option
    exercises and employee stock purchase plan, net of repurchases


127,691







1,827















1,827Stock-based compensation










1,642















1,642Other comprehensive income


















95







95Net loss






















(63,182
)


(63,182
)Comprehensive loss


























(63,087
)Balance at December 31, 2007


12,021,388


$
6,966


$
739,268


$
(2,439
)

$
29


$
(742,223
)

$
1,601    40




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##### Table of Contents



TRANSMETA
    CORPORATION



CONSOLIDATED
    STATEMENTS OF CASH FLOWS  Years Ended December 31,2007


2006


2005(In thousands)Cash flows from operating activities:Net loss

$
(63,182
)

$
(23,498
)

$
(6,181
)Adjustments to reconcile net loss to net cash (used in) provided
    by operating activities:Stock-based compensation expense


1,642



5,774



(34
)Depreciation


557



1,050



1,299Loss (gain) on disposal of fixed assets, net


(173
)






65Allowance for doubtful accounts










(9
)Amortization of patents and patent rights


6,846



6,846



6,846Impairment charge on inventories


364



1,802



Impairment charge on long-lived assets and other assets


302



800



Non cash restructuring charges


8,879



876



2,033Gain on debt settlement with a development partner










(200
)Changes in operating assets and liabilities:Accounts receivable, current


147



1,376



613Inventories


(360
)


(1,537
)


5,145Prepaid expenses and other current assets


(104
)


1,022



(61
)Other receivables


(234,600
)






Other assets


1,348



(1,237
)


Accounts payable and accrued liabilities


8,562



821



(14,034
)Income taxes payable


3,257



(18
)


(40
)Deferred operating gain


234,600







Deferred income


(15
)


(5,922
)


5,908Advances from customers


(1,320
)


(5,940
)


7,260Accrued restructuring charges


(10,271
)


(2,148
)


(3,022
)Net cash (used in) provided by operating activities


(43,521
)


(19,933
)


5,588Cash flows from investing activities:Purchase of
    available-for-sale
    investments


(4,972
)


(28,000
)


(26,000
)Proceeds from sale or maturity of
    available-for-sale
    investments


32,000



27,000



33,514Proceeds from disposal of fixed assets


189







Purchase of property and equipment


(48
)


(457
)


(797
)Payment to development partner










(4,800
)Net cash provided by (used in) investing activities


27,169



(1,457
)


1,917Cash flows from financing activities:Net proceeds from direct placement offering of common stock and
    warrants


11,571







Net proceeds from issuance of preferred stock


6,966







Proceeds from sales of common stock under employee stock
    purchase and incentive option plans


1,827



5,326



3,219Repayment of notes from stockholders










18Repayment of debt and capital lease obligations










(356
)Net cash provided by financing activities


20,364



5,326



2,881Increase (decrease) in cash and cash equivalents


4,012



(16,064
)


10,386Cash and cash equivalents at beginning of period


11,595



27,659



17,273Cash and cash equivalents at end of period

$
15,607


$
11,595


$
27,659Supplemental disclosure of non-cash financing/investing
    activities during the period:Beneficial conversion feature of preferred stock

$
3,630


$



$
Deemed dividend for beneficial conversion feature of preferred
    stock


(3,630
)






Software licenses included in prepaid expense acquired with
    current and long-term payable






2,000



Supplemental disclosure of cash paid during the period:Cash paid for interest

$
55


$
4


$
302Cash paid for taxes


55



56



145    41




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    Overview  Formation
    and Business of the Company
  tm
  end-of-life
      Fiscal
    Year
    2.
    Summary
    of Significant Accounting Policies  Principles
    of Consolidation
   42




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Use of
    Estimates
    Concentrations
    of Credit Risk
      Revenue
    Recognition
  No. 00-21, Revenue Arrangements with Multiple
    Deliverables Revenue Recognition, agreed-upon
  and/or
 43




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Operating
    Gain on Intel Litigation Settlement
  Deferred Operating Gain. Interest on Receivables and Payables
    December 31,2007Intel litigation settlement receivable and deferred operating
    gain


Asset


Liability(In thousands)Non-interest bearing note, consisting ofInitial $150 million payment (Jan 2008) and 5 x $20 million (Jan
    2009-Jan 2013)

$
250,000


$
250,000Face amount



Rate



DiscountLIBOR 1 mo rate

$
150,000



4.70
%

$
600AAA corp bond rate


100,000



5.41
%


14,800Less unamortized discount














(15,400
)


(15,400
)Total Intel settlement present value as of Dec. 31, 2007









$
234,600


$
234,600Other receivables, current










149,400Other receivables, long-term










85,200Total Intel settlement receivable, as of Dec. 31, 2007









$
234,600Deferred operating gain, current portion














23,460Deferred operating gain, long-term














211,140Total Intel settlement deferred operating gain, as of Dec. 31,
    2007









$
234,600    44




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Operating Gain


Interest IncomeYears

Recognized


Recognized(In thousands)2007

$



$
2008


23,460



5,2242009


23,460



3,8822010


23,460



3,0082011


23,460



2,0852012


23,460



1,1132013


23,460



882014


23,460



2015


23,460



2016


23,460



2017


23,460



Total

$
234,600


$
15,400   Comprehensive
    Income (Loss)
    Cash
    Equivalents and Short-term Investments
  available-for-sale
  available-for-sale available-for-sale
  available-for-sale other-than-temporary.
   45




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Accounts
    Receivable
    Fair
    Values of Financial Instruments
      Segment
    Reporting
  Disclosures about Segments of
    an Enterprise and Related Information
  Property
    and Equipment
    Valuation
    and Impairment of Long-Lived and Intangible Assets
  Accounting for the Impairment or Disposal of Long-Lived
    Assets.
 46




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Research
    and Development
  Accounting for Research and Development
    Costs
  Foreign
    Currency
    Advertising
    Costs
    Income
    Taxes
    Accounting for Uncertainty in Income
    Taxes
  Computation
    of Earnings (Loss) Per Share
  Earnings Per Share
  Stock-Based
    Compensation
  Share-Based
    Payment.
 47




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Accounting
    for Stock Issued to Employees Accounting for Stock-Based
    Compensation.
      Transition Election Related
    to Accounting for Tax Effects of Share-Based Payment
    Awards
  Periods
    prior to the adoption of
    SFAS No. 123(R)
  Accounting for Stock-Based Compensation, Accounting for
    Stock-Based Compensation  Transition and
    Disclosures.
 48




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2005Net loss, as reported

$
(6,181
)Add: Stock-based compensation expense included in reported net
    loss, net of related tax effects


(34
)Less: Total stock-based employee compensation expense under fair
    value based method for all awards, net of related tax effects


(11,566
)Pro-forma net loss

$
(17,781
)Basic and diluted net loss per share  as reported

$
(0.65
)Basic and diluted net loss per share  pro forma

$
(1.87
)   Adoption
    of SFAS No. 123(R)
    Years Ended December 31,2007


2006Stock-based compensation expense by type of award:Employee stock options

$
2,341


$
4,702Employee stock purchase plan


(699
)


1,072Total stock-based compensation


1,642



5,774Tax effect on stock-based compensation






Net effect of stock-based compensation on net income (loss)

$
1,642


$
5,774Effect on earnings per share attributable to common shareholders:Basic

$
(0.16
)

$
(0.59
)Diluted

$
(0.16
)

$
(0.59
)   Stock options:
     49




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Employee Stock Purchase Plan
    (ESPP):
  Valuation
    Assumptions
      Years Ended December 31,Employee Stock Option Plans

2007


2006


2005Risk-free interest rate


3.4% to 4.7%



4.6% to 5.0%



3.6% to 4.4%Expected life in years


3.33



3.41



2.8Expected dividend yield


0%



0%



0%Expected stock price volatility


107%



99%



94%Weighted-average fair value of stock options granted


$9.40



$19.60



$10.40   Years Ended December 31,Employee Stock Purchase Plan (ESPP)

2007


2006


2005Risk-free interest rate


5.1%



4.6% to 4.8%



2.9% to 4.3%Expected life in years


1.25



1.25



0.05Expected dividend yield


0%



0%



0%Expected stock price volatility


78%



89%



94%Weighted-average fair value of purchase rights granted under the
    purchase plan


$14.60



$13.40



$8.20  50




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      One-for-20
    Reverse Stock Split in August 2007
  one-for-10 one-for-40,
  one-for-twenty
  Form 10-K
  Accrued
    Restructuring Costs
  No. 94-3, Liability Recognition for Certain Employee Termination
    Benefits and Other Costs to Exit an Activity (including Certain
    Costs Incurred in a Restructuring) Accounting for
    Costs Associated with Exit or Disposal Activities No. 94-3.
  Loss
    Contingencies
  Accounting for
    Contingencies
 51




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Reclassifications
    Beneficial
    Conversion Feature and Deemed Dividend related to Series B
    Preferred Stock
  paid-in-capital EITF 98-5 Accounting for Convertible Securities with Beneficial
    Conversion Features or Contingently Adjustable Conversion
    Ratios paid-in-capital
  Recent
    Accounting Pronouncements
  Accounting for Uncertainty
    in Income Taxes  an Interpretation of FASB Statement
    No. 109 Accounting for Income
    Taxes
  Fair Value Measurements
  157-2, Effective Date of FASB Statement
    No. 157 FSP 157-2
 52




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  The Fair Value Option for Financial Assets and
    Financial Liabilities-Including an Amendment of FASB Statement
    No. 115
  Business Combinations
  Non-controlling Interests in Consolidated Financial
    Statements  an amendment of ARB No. 51
  3.
    Financial
    Statement Components  Short-Term
    Investments
  available-for-sale
  UnrealizedFair Value


Book Value


Gain/(Loss)(In thousands)As of December 31, 2007Federal agency discount notes

$



$



$
Commercial paper


2,968



2,972



(4
)Total short term investments

$
2,968


$
2,972


$
(4
)As of December 31, 2006Federal agency discount notes

$
15,955


$
16,000


$
(45
)Commercial paper


14,000



14,000



Total short term investments

$
29,955


$
30,000


$
(45
)  53




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##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    UnrealizedFair Value


Book Value


Gain/(Loss)(In thousands)As of December 31, 2007Amounts maturing within one year

$
2,968


$
2,972


$
(4
)Amounts maturing after one year, within five years










Total short term investments

$
2,968


$
2,972


$
(4
)As of December 31, 2006Amounts maturing within one year

$
23,963


$
24,000


$
(37
)Amounts maturing after one year, within five years


5,992



6,000



(8
)Total short term investments

$
29,955


$
30,000


$
(45
)   available-for-sale other-than-temporary
  available-for-sale available-for-sale
    Property
    and Equipment
    December 31,


December 31,2007


2006(In thousands)Property and equipment, netLeasehold improvements

$
2,325


$
2,076Computer equipment


3,519



4,183Furniture and fixtures


395



677Computer software


775



1,8587,014



8,794Less accumulated depreciation and amortization


(6,730
)


(8,036
)Total

$
284


$
758    54




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Other
    accrued liabilities
    December 31,


December 31,2007


2006(In thousands)Other accrued liabilitiesAccrued audit

$
152


$
847Deferred rent


46



407Accrued insurance






546Other


830



1,166$
1,028


$
2,966   Accumulated
    Other Comprehensive Income (Loss)
    Years Ended December 31,2007


2006


2005(In thousands)Net loss

$
(63,182
)

$
(23,498
)

$
(6,181
)Net change in unrealized gain (loss) on investments


41



144



(15
)Net change in foreign currency translation adjustments


54



(15
)


(55
)Net comprehensive loss

$
(63,087
)

$
(23,369
)

$
(6,251
)     December 31,


December 31,2007


2006(In thousands)Net unrealized loss on investments

$
(4
)

$
(45
)Cumulative foreign currency translation adjustments


33



(21
)Accumulated other comprehensive income (loss)

$
29


$
(66
)   Advances
    from Customers
    Accounts
    receivable and deferred operating gain from Intel litigation
    settlement
   55




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Plus:


Less:


Other ReceivablesInterest


Cash


Ending





LongYears

Income


Receipts


Balance


Current


Term(In thousands)2007









$
234,600


$
149,400


$
85,2002008

$
5,224


$
150,000



89,824



19,192



70,6322009


3,882



20,000



73,706



19,192



54,5142010


3,008



20,000



56,714



19,192



37,5222011


2,085



20,000



38,799



19,192



19,6072012


1,113



20,000



19,912



19,912



2013


88



20,000











2014


















2015


















2016


















2017


















Total

$
15,400


$
250,000  56




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Less:Operating


Deferred Operating GainGain


Ending





LongYears

Recognized


Balance


Current


Term(In thousands)2007





$
234,600


$
23,460


$
211,1402008

$
23,460



211,140



23,460



187,6802009


23,460



187,680



23,460



164,2202010


23,460



164,220



23,460



140,7602011


23,460



140,760



23,460



117,3002012


23,460



117,300



23,460



93,8402013


23,460



93,840



23,460



70,3802014


23,460



70,380



23,460



46,9202015


23,460



46,920



23,460



23,4602016


23,460



23,460



23,460



2017


23,460











Total

$
234,600   4.
    Earnings
    (Loss) Per Share  Earnings Per Share
 57




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2007


2006


2005(In thousands,except per share amounts)NumeratorNet loss attributable to common shareholders, as reported

$
(66,812
)

$
(23,498
)

$
(6,181
)Denominator:Weighted average shares used to compute basic net loss per share
    attributable to common shareholders


10,559



9,792



9,520Dilutive potential shares










Shares used to compute diluted net loss per share


10,559



9,792



9,520Basic net loss per share attributable to common shareholders

$
(6.33
)

$
(2.40
)

$
(0.65
)Diluted net loss per share attributable to common shareholders

$
(6.33
)

$
(2.40
)

$
(0.65
)     5.  Technology
    License Agreements
       58




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  6.
    Patents
    and Patent Rights    December 31,2007


2006(In thousands)Patents and patent rights

$
47,920


$
47,920Less: accumulated amortization


(45,532
)


(38,686
)Patents and patent rights, net

$
2,388


$
9,234         (In thousands)Years ending December 31,2008

$
2,3882009


Total future amortization

$
2,388   7.
    Restructuring
    Charges   59




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Excess


WorkforceFacilities


Reduction


TotalBalance as of December 31, 2004

$
5,245


$



$
5,245Restructuring charges


1,899



1,502



3,401Adjustments and reversals


(1,278
)


(90
)


(1,368
)Cash drawdowns


(1,610
)


(1,412
)


(3,022
)Balance as of December 31, 2005


4,256







4,256Restructuring charges


551







551Change in estimates


325







325Cash drawdowns


(2,148
)






(2,148
)Balance as of December 31, 2006


2,984







2,984Restructuring charges


1,537



7,104



8,641Change in estimates


238







238Cash drawdowns


(3,222
)


(7,049
)


(10,271
)Balance as of December 31, 2007

$
1,537


$
55


$
1,592   8.
    Impairment
    Charges  Long-Lived
    and Other Assets
      Inventories
   60




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    9.
    Commitments
    and Contingencies        Future Minimum Payments Due by PeriodYears Ended December 31,Total


2008


2009(In thousands)Operating leases(1)

$
2,047


$
2,047


$
Unconditional contractual obligations(2)


1,467



667



800Total

$
3,514


$
2,714


$
800     (1)
    
    Operating leases include agreements of building facilities less
    fiscal 2008 sublease income of $339 thousand(2)
    
    Contractual obligations include agreements to purchase goods or
    services that are enforceable and legally binding on us and that
    specify all significant terms, including: fixed or minimum
    quantities to be purchased; fixed, minimum or variable price
    provisions; and the approximate timing of the transaction.
    Contractual obligations also include agreements for design tools
    and software for use in product development.  Indemnifications
    and warranties
     61




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    10.
    Litigation
    and Asserted Claims    In re Transmeta Corporation Initial
    Public Offering Securities Litigation, 1999-2000. In
    re Initial Public Offering Securities Litigation,
   62




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Simmonds v. Morgan Stanley, et al. No. C07-1636
  Riley Investment Partners
    Investment Fund, L.P., et al. v. Horsley, et al. (Transmeta
    Corp.), No. 1:08-CV-104667.
  11.
    Employee
    Stock Option Plans  2000
    Equity Incentive Plan
   63




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Non-Plan
    Stock Option Grants
    Prior
    Equity Incentive Plans
     64




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Stock
    Option Summary
    WeightedAverageWeighted


Remaining


AggregateShares





Weighted


Average Grant


Contractual


IntrinsicAvailable for


Number of


Average


Date Fair


Term


ValueGrant


Shares


Exercise Price


Value


(In Years)


(In thousands)Balance at December 31, 2004(*)


208,856



1,990,186


$
48.80Additional shares reserved


469,433



Options granted


(770,418
)


770,418



16.00


$
10.40Options exercised






(30,210
)


18.20Options forfeited / canceled / expired


766,654



(774,154
)


44.60Balance at December 31, 2005(*)


674,525



1,956,240


$
38.00Additional shares reserved


479,277



Options granted


(391,308
)


391,308



29.60


$
19.60Options exercised






(183,895
)


19.00Options forfeited / canceled / expired


264,619



(264,619
)


38.60Balance at December 31, 2006(*)


1,027,113



1,899,034


$
38.00Additional shares reserved


494,691



Options granted


(1,358,800
)


1,358,800



11.91


$
9.40Options exercised






(43,598
)


14.34Options forfeited / canceled / expired


1,266,191



(1,316,868
)


38.72Outstanding as of December 31, 2007


1,429,195



1,897,368


$
19.42







8.2


$
2,377Vested and expected to vest at December 31, 2007






1,538,175


$
20.81







6.8


$
2,046Options exercisable at December 31, 2007






594,931


$
32.03







3.8


$
1,667     (*)
    
    All data adjusted for
    1-for-20
    reverse stock split in August 2007.  in-the-money in-the-money
  65




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  WeightedNumber of


AverageShares Exercisable at:

Shares


Exercise PriceDecember 31, 2005


1,151,122


$
51.60December 31, 2006


1,216,738


$
46.20December 31, 2007


594,931


$
32.03     OutstandingWeighted





ExercisableAverage


Weighted





WeightedRemaining


Average





AverageShares


Contractual Term


Exercise


Shares


ExerciseRange of Exercise Prices

Outstanding


(In Years)


Price


Exercisable


PriceAs of December 31, 2007:$00.00 - $11.00


224,500



4.65


$
4.86



122,000


$
$12.02 - $13.00


51,143



9.65



12.04



1,143



13.00$13.36 - $13.36


1,019,300



8.41



13.36







$13.40 - $15.00


217,413



7.00



14.51



132,611



14.96$15.80 - $43.00


227,899



5.70



28.54



182,064



28.51$43.20 - $190.00


152,629



2.82



70.27



152,629



70.27$223.40 - $223.40


450



3.35



223.40



450



223.40$244.80 - $244.80


600



3.41



244.80



600



244.80$260.20 - $260.20


3,434



3.37



260.20



3,434



260.20Total


1,897,368



8.22


$
19.42



594,931


$
32.03   Accelerated
    vesting of Certain Stock Options
      Par
    Value Stock Options
   66




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Employee
    Stock Purchase Plan
      Year Ended


Year Ended


Year Ended2007


2006


2005Number of shares issued


84,093



124,395



166,657Fair value of shares issued

$
14.60


$
13.40


$
8.20   12.
    Stockholders
    Equity    Common
    Stock Reserved for Issuance
    As of December 31,2007


2006Warrants outstanding


1,012,000



18,252Options outstanding


1,897,368



1,899,034Employee Stock Purchase Plan


14,849



4Series B convertible preferred stock outstanding


713,470



Future option grants


1,634,558



1,194,976Total shares reserved for issuance


5,272,245



3,112,266  67




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Common
    Stock Warrants
    ExerciseIssuance

Number of


Price perDate

Shares


Share


Expiration DateApril 1998


12,000


$
25.00


April 2008September 2007


1,000,000


$
9.00


September 2012Warrants outstanding


1,012,000     Treasury
    Stock
    Preferred
    Stock
      Sale
    of Series B Preferred Stock to Advanced Micro
    Devices
     68




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Conversion rights, Non-redeemable. one-for-twenty
  Dividends.
  Liquidation Preference.
  Voting Rights.
   69




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Beneficial Conversion Feature and Deemed
    Dividend. paid-in-capital EITF 98-5 Accounting for Convertible Securities with Beneficial
    Conversion Features or Contingently Adjustable Conversion
    Ratio paid-in-capital
  One-for-20
    Reverse Stock Split in August 2007
  one-for-10 one-for-40,
  one-for-twenty
  Form 10-K
  Direct
    Placement Offering of Common Stock and Warrants
  Form S-3 No. 333-144476,
   70




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    EITF 00-19 Accounting for Derivative Financial Instruments Indexed
    to, and Potentially Settled in, a Companys Own
    Stock
        Rule 13-3e
  Stockholders
    Rights Agreement
    13.
    Employee
    Benefit Plan   71




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    14.
    Related
    Party Transaction  Sales
    to Investee
    15.
    Income
    Taxes    Years Ended December 31,2007


2006


2005(In thousands)CurrentFederal

$
3,273


$



$
State


24



2



6Foreign


11



84



162Subtotal current provision


3,308



86



168DeferredFederal










State










Subtotal deferred provision










Total provision for income taxes

$
3,308


$
86


$
168     Years Ended December 31,2007


2006


2005Tax at federal statutory rate


34.0
%


34.0
%


34.0
%State, net of federal benefit


5.8
%


5.6
%


3.0
%Non-deductible items


(8.7
)%


(7.1
)%


4.0
%Foreign income not taxed at federal rate


0.0
%


(0.1
)%


(0.2
)%Credits


6.7
%


9.6
%


44.7
%NOLs not benefitted


(10.0
)%






Alternative minimum tax


(5.5
)%






Change in state rate


0.0
%






FAS 109
    true-up


(0.1
)%






Change in valuation allowance


(27.7
)%


(42.3
)%


(88.2
)%Provision for income taxes


(5.5
)%


(0.3
)%


(2.7
)%  72




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2007


2006(In thousands)Deferred tax assets:Depreciation and amortization

$
49,000


$
58,000Reserves and other


102,000



10,000Credits


26,000



24,000Net operating losses


75,000



143,000Gross deferred tax asset


252,000



235,000Valuation allowance


(252,000
)


(235,000
)Net deferred tax assets

$



$
          73




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2007


2006


2005(In thousands)United States

$
(59,950
)

$
(23,530
)

$
(6,078
)Foreign


76



118



65Income (loss) before income taxes

$
(59,874
)

$
(23,412
)

$
(6,013
)   Accounting for Uncertainty in Income Taxes.
          (In thousands)Balance as of January 1, 2007

$
7,700Additions for tax positions related to the current year


500Additions for tax positions related to prior years


Reductions for tax positions of prior years


Settlements


Balance as of December 31, 2007

$
8,200   16.
    Business
    Segments and Major Customers   74




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Years Ended December 31,2007


2006


2005Japan


89
%


98
%


67
%North America


6
%


1
%


5
%China/Hong Kong


0
%






17
%Taiwan


4
%






6
%Other


1
%


1
%


5
%Total net revenue


100
%


100
%


100
%         17.
    Subsequent
    Events  The
    Companys receipt of initial payment and dismissal of
    lawsuit pursuant to the Intel litigation
    settlement
      The
    Companys evaluation of and response to an unsolicited
    expression of interest from Riley Investment Management
    LLC
   75




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   18.
    Quarterly
    Results of Operations (Unaudited)    Three Months EndedDec. 31,


Sept. 30,


Jun. 30,


Mar.31,


Dec. 31,


Sept. 30,


Jun. 30,


Mar.31,2007


2007


2007


2007


2006


2006


2006


2006(In thousands, except for per share data)Revenue:Product

$



$



$
25


$
142


$
216


$
507


$
361


$
589License


102



1















10,000







Service


24



43



146



1,997



2,177



6,810



8,970



18,920Total revenue


126



44



171



2,139



2,393



17,317



9,331



19,509Cost of revenue:Product(*)














80



194



9



(62
)


162License






















39







Service(*)


11



18



80



1,138



1,473



3,913



5,795



10,881Impairment charge on inventories














364



1,802











Total cost of revenue


11



18



80



1,582



3,469



3,961



5,733



11,043Gross profit


115



26



91



557



(1,076
)


13,356



3,598



8,466Operating expenses:Research and development(*)(1)


1,981



1,336



2,537



4,936



7,261



4,838



4,769



3,252Selling, general and administrative(*)(2)


17,236



6,107



5,644



6,106



5,038



4,847



6,043



5,544Restructuring charges, net


1



177



1,978



6,723



486



148



133



109Amortization of patents and patent rights


1,712



1,711



1,711



1,712



1,712



1,711



1,712



1,711Impairment charge on long-lived and other assets










8



294



800











Total operating expenses (gain)


20,930



9,331



11,878



19,771



15,297



11,544



12,657



10,616Operating (loss) income


(20,815
)


(9,305
)


(11,787
)


(19,214
)


(16,373
)


1,812



(9,059
)


(2,150
)Interest income and other, net


138



250



350



509



625



731



592



508Interest expense


53



(15
)


(28
)


(10
)


(97
)


(1
)


0



0Income (loss) before income taxes


(20,624
)


(9,070
)


(11,465
)


(18,715
)


(15,845
)


2,542



(8,467
)


(1,642
)Provision for (benefit from) income taxes(3)


3,301



3



(15
)


19



56



23



2



5Net income (loss)


(23,925
)


(9,073
)


(11,450
)


(18,734
)


(15,901
)


2,519



(8,469
)


(1,647
)Deemed dividend for beneficial conversion feature of preferred
    stock






(3,630
)






















Net income (loss) attributable to common shareholders

$
(23,925
)

$
(12,703
)

$
(11,450
)

$
(18,734
)

$
(15,901
)

$
2,519


$
(8,469
)

$
(1,647
)Net income (loss) per share attributable to common
    shareholders  basic

$
(1.99
)

$
(1.24
)

$
(1.15
)

$
(1.88
)

$
(1.61
)

$
0.26


$
(0.87
)

$
(0.17
) 76




---



##### Table of Contents



TRANSMETA
    CORPORATION
  NOTES TO CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Three Months EndedDec. 31,


Sept. 30,


Jun. 30,


Mar.31,


Dec. 31,


Sept. 30,


Jun. 30,


Mar.31,2007


2007


2007


2007


2006


2006


2006


2006(In thousands, except for per share data)Net income (loss) per share attributable to common
    shareholders  fully diluted

$
(1.99
)

$
(1.24
)

$
(1.15
)

$
(1.88
)

$
(1.61
)

$
0.25


$
(0.87
)

$
(0.17
)Weighted average shares outstanding  basic


12,021



10,236



9,997



9,961



9,879



9,832



9,786



9,668Weighted average shares outstanding   diluted


12,021



10,236



9,997



9,961



9,879



9,990



9,786



9,668(*) Includes stock-based compensation:Cost of product revenue

$



$



$



$



$
4


$
(4
)

$
5


$
4Cost of service revenue


1



1



14



3



186



239



763



601Research and development


328



(271
)


364



(82
)


723



339



403



258Selling, general and administrative


343



244



315



382



533



527



739



454     (1)
    
    Fourth quarter 2007 research and development costs included
    $0.2 million of Intel litigation related expenses(2)
    
    Fourth quarter 2007 selling, general and administrative costs
    included $15.1 million of Intel litigation related expenses(3)
    
    Fourth quarter 2007 tax provision for a fiscal year with
    financially-reported net loss reflects 2007 tax return
    recognition of Intel settlement, mitigated by NOL and tax
    credits utilization. 77




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##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  (a)
    Disclosure
    Controls and Procedures  Rules 13a-15(e) 15d-15(e)
    (b)
    Managements
    Report on Internal Control Over Financial Reporting  Rules 13a-15(f) 15d-15(f).
          (c)
    Report of
    Independent Registered Public Accounting Firm on Internal
    Control Over Financial Reporting   78




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##### Table of Contents



/s/ Burr,
    Pilger & Mayer LLP
     (d)
    Changes
    in Internal Control Over Financial Reporting   79




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##### Table of Contents



(e)
    Inherent
    Limitations on Effectiveness of Controls    Item 9B.
    Other
    Information   PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance    http://www.transmeta.com/corporate/ir/corp_governance.html.
  Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence    Item 14.
    Principal
    Accountant Fees and Services   80




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##### Table of Contents



PART IV  Item 15.
    Exhibits
    and Financial Statement Schedules  Financial Statements
    Financial Statement Schedules
    Exhibits
    Exhibits
    Financial Statement Schedules
   81




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##### Table of Contents



SIGNATURES      By:
    /s/  Sujan
    Jain   Chief Financial Officer
 (Principal Financial and Accounting Officer and
 Duly Authorized Officer
    By:
    /s/  Lester
    M. Crudele   Chief Executive Officer
 (Principal Executive Officer
   82




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##### Table of Contents



POWER OF
    ATTORNEY  Form 10-K Form 10-K Form 10-K Form 10-K)
    Signature

Title

Date/s/  Lester
    M. Crudele[Principal
    Executive Officer]
    Lester M. Crudele

Chief Executive Officer

March 17, 2008/s/  Sujan
    Jain[Principal
    Financial Officer and
    Duly Authorized Officer]
    Sujan Jain

Chief Financial Officer

March 17, 2008/s/  Murray
    A. GoldmanMurray
    A. Goldman

Director

March 15, 2008/s/  R.
    Hugh BarnesR.
    Hugh Barnes

Director

March 17, 2008/s/  Robert
    V. DickinsonRobert
    V. Dickinson

Director

March 15, 2008/s/  William
    P. TaiWilliam
    P. Tai

Director

March 17, 2008/s/  T.
    Peter ThomasT.
    Peter Thomas

Director

March 15, 2008/s/  Rick
    TimminsRick
    Timmins

Director

March 15, 2008  83




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##### Table of Contents



INDEX TO
    EXHIBITS  Incorporated by ReferenceExhibit









Filing

FileNumber

Exhibit Title

Form

File No.

Exhibit

Date

Herewith3
.01

Second Amended and Restated Certificate of Incorporation

10-K




3
.01

03/07/20013
.02

Restated Bylaws

S-1

333-440303
.03

Certificate of Designations specifying the terms of the
    Series A Junior Participating Preferred Stock of Transmeta
    as filed with the Secretary of State of the State of Delaware

8-A




3
.02

01/16/20023
.04

Certificate of Designations, Preferences and Rights of
    Series B Preferred Stock (par value $0.00001 per
    share) of Transmeta Corporation filed with the Secretary of
    State of Delaware on July 3, 2007.

8-K




3
.1

7/9/20074
.01

Specimen common stock certificate

S-1




4
.014
.02

Fifth Restated Investors Rights Agreement dated
    March 31, 2000, between Transmeta, certain stockholders of
    Transmeta and a convertible note holder named therein

S-1




4
.024
.03

Form of Piggyback Registration Rights Agreement

S-1




4
.034
.04

Rights Agreement dated January 15, 2002 between Transmeta
    and Mellon Investor Services LLC as Rights Agent, which includes
    as Exhibit A the form of Certificate of Designations of
    Series A Junior Participating Preferred Stock, as
    Exhibit B the Summary of Stock Purchase Rights and as
    Exhibit C the Form of Rights Certificate

8-A




4
.01

01/16/20024
.05

Voting Agreement between Transmeta Corporation and Advanced
    Micro Devices, Inc. dated July 2, 2007.

8-K




4
.1

7/9/20074
.06

Registration Rights Agreement between Transmeta Corporation and
    Advanced Micro Devices, Inc. dated July 2, 2007.

8-K




4
.2

7/9/200710
.01

Form of Indemnity Agreement.**

S-1




10
.0110
.02

1995 Equity Incentive Plan.**

S-1




10
.0210
.03

1997 Equity Incentive Plan.**

S-1




10
.0310
.04

2000 Equity Incentive Plan.**

S-8




4
.06

01/18/200210
.05

2000 Employee Stock Purchase Plan.**

S-8




4
.08

05/28/200210
.06

Lease Agreement, dated November 1, 1995, between John
    Arrillaga, as trustee of John Arrillaga Family Trust, Richard T.
    Peery, as trustee of Richard T. Peery Separate Property Trust,
    and Transmeta, as amended by Amendment No. 1, dated
    January 29, 1997, and Amendment No. 2, dated
    April 2, 1998, between John Arrillaga, as trustee of John
    Arrillaga Survivors Trust (successor in interest to the
    Arrillaga Family Trust), Richard T. Peery, as trustee of Richard
    T. Peery Separate Property Trust, and Transmeta

S-1




10
.0810
.07

Lease Agreement, dated January 29, 1997, between John
    Arrillaga, as trustee of John Arrillaga Family Trust, Richard T.
    Peery, as trustee of Richard T. Peery Separate Property Trust,
    and Transmeta, as amended by Amendment No. 1, dated
    April 2, 1998, between John Arrillaga, as trustee of John
    Arrillaga Survivors Trust (successor in interest to the
    Arrillaga Family Trust), Richard T. Peery, as trustee of Richard
    T. Peery Separate Property Trust, and Transmeta

S-1




10
.0910
.08

Lease Agreement, dated April 2, 1998, between John
    Arrillaga, as trustee of John Arrillaga Survivors Trust,
    Richard T. Peery, as trustee of Richard T. Peery Separate
    Property Trust, and Transmeta

S-1




10
.1010
.09

Lease Agreement, dated April 2, 1998, between John
    Arrillaga, as trustee of John Arrillaga Survivors Trust,
    Richard T. Peery, as trustee of Richard T. Peery Separate
    Property Trust, and Transmeta

S-1




10
.1110
.10

Form of Stock Option Agreement under Transmetas 2000
    Equity Incentive Plan.**

S-1




10
.1710
.11

Form of Stock Option Agreement (for Non-Employee Directors)
    under Transmetas 2000 Equity Incentive Plan.**

S-1




10
.1810
.12

Form of Stock Option Agreement. Incorporated by reference to
    Exhibit 10.18 to Transmetas
    Form 10-K
    for the year ended December 31, 2000.**

10-K




10
.18 84




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##### Table of Contents



Incorporated by ReferenceExhibit









Filing

FileNumber

Exhibit Title

Form

File No.

Exhibit

Date

Herewith10
.17

Technology Transfer Services and Technology License Agreement,
    dated March 25, 2004, between Transmeta and NEC Electronics
    Corporation.+

10-K




10
.17

3/29/200510
.18

LongRun2 Technology License Agreement, dated November 29,
    2004, between Transmeta and Fujitsu Limited.+

10-K




10
.18

3/29/200510
.19

LongRun2 Technology License Agreement, dated January 20,
    2005, between Transmeta and Sony Corporation.+

10-K




10
.19

3/29/200510
.20

Design Services Agreement, dated March 29, 2005, among
    Transmeta Corporation, Sony Computer Entertainment, Inc. and
    Sony Corporation.+

10-Q




10
.20

05/25/200510
.22

Master Services Agreement and Intellectual Property Assignment,
    dated April 1, 2005, by and between Transmeta Corporation
    and Microsoft Corporation

10-Q




10
.22

08/15/200510
.23

Series of six Schedule A agreements, dated May 11,
    2005, by and between Transmeta Corporation and Microsoft
    Corporation

10-Q




10
.23

08/15/200510
.24

Non-employee Director Compensation Plan

8-K







06/14/200510
.26

LongRun2 Technology License Agreement, dated February 22,
    2006, between Transmeta and Toshiba Corporation.

10-Q




10
.26

05/10/200610
.28

Agreement for the Purchase and Sale of Products, entered
    June 5, 2006, between Transmeta and Advanced Micro Devices,
    Inc. +

10-Q




10
.28

08/09/200610
.29

Consulting agreement between Lester M. Crudele and Transmeta
    Corporation dated October 31, 2006

10-Q




10
.29

11/06/200610
.30

Offer of Employment as President and Chief Executive Officer,
    dated January 31, 2007, from Transmeta Corporation to
    Lester M. Crudele.**

10-Q




10
.30

05/15/200710
.31

Separation and Release Agreement and Consulting Agreement,
    entered February 1, 2007, between Transmeta Corporation and
    Arthur L. Swift.**

10-Q




10
.31

05/15/200710
.32

Incentive Retention Agreement, entered February 27, 2007,
    between Transmeta Corporation and John OHara Horsley.**

8-K




10
.32

01/04/200810
.33

Separation and Release Agreement and Consulting Agreement,
    entered June 15, 2007, between Transmeta Corporation and
    David R. Ditzel.**

10-Q




10
.33

11/08/200710
.34

Stock Purchase Agreement between Transmeta Corporation and
    Advanced Micro Devices, Inc. dated July 2, 2007.

8-K




10
.1

07/09/200710
.35

Separation and Release Agreement entered August 14, 2007,
    between Transmeta Corporation and Ralph J. Harms.**

10-Q




10
.34

11/08/200710
.36

Offer of Employment as Chief Financial Officer, dated
    August 11, 2007, from Transmeta Corporation to Sujan Jain.**

10-Q




10
.35

11/08/200710
.37

Settlement Release and License Agreement between Transmeta
    Corporation and Intel Corporation











X10
.38

LongRun and LongRun2 Technology License Agreement between
    Transmeta Corporation and Intel Corporation+











X21
.01

Subsidiaries

S-1




21
.0123
.01

Consent of Burr, Pilger & Mayer LLP, Independent
    Registered Public Accounting Firm











X24
.01

Power of Attorney. See Signature Page











X31
.01

Certification by Lester M. Crudele pursuant to
    Rule 13a-14(a)











X31
.02

Certification by Sujan Jain pursuant to
    Rule 13a-14(a)











X32
.01

Certification by Lester M. Crudele pursuant to 18 U.S.C.
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002











X32
.02

Certification by Sujan Jain pursuant to 18 U.S.C.
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002











X    **
    
    Management contract or compensatory
    arrangement.+
    
    Confidential treatment has been
    requested for portions of this exhibit. These portions have been
    omitted from this Report and have been filed separately with the
    Securities and Exchange Commission. 85