Document:

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                                                                 EXHIBIT 10.10

CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE
BEEN REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION.

                            CROSS LICENSE AGREEMENT

This Cross License Agreement ("Agreement") is made and entered into as of this
                               ---------
21 day of March, 2000 ("Effective Date") between Innovative Semiconductors,
                        --------------
Inc., a California corporation with its principal place of business at 465
Fairchild Drive, Suite 227, Mountain View, CA 94043 ("Innovative") and IGS
                                                      ----------
Technologies, a California corporation doing business at 4001 Burton Drive,
Santa Clara, CA 95054 ("IGS").
                        ---

                                    RECITALS

A.  Innovative has developed, and is developing, certain proprietary
semiconductor technology and products, including but not limited to an ***
controller with *** support and an *** core.

B.  Innovative is engaged in the business of providing technology licenses to
such proprietary semiconductor technology and products.

C.  IGS designs, manufactures and sells integrated circuits.

D.  IGS has developed, and is developing, certain proprietary semiconductor
technology, including a ***, ***, an ***, ***, a ***V to ***V voltage regulator,
a ***V to ***V voltage regulator, and a *** programmable ***.

E.  IGS and Innovative desire that, subject to the terms and conditions of this
Agreement, Innovative grant to IGS certain license rights to design, manufacture
and sell integrated circuits which incorporate such Innovative technology, and
that IGS grant to Innovative certain license rights to sublicense such IGS
technology and design, manufacture and sell integrated circuits which
incorporate such IGS technology.

NOW, THEREFORE, IGS and Innovative hereby agree as follows:

1.  DEFINITIONS
    -----------

     1.1 "Re-branded Chip" shall mean an integrated circuit that is manufactured
          ---------------
by a party for the main purpose of distribution and sales under the brand of a
third party.

     1.2 "IGS Core Specifications" shall mean the technical specifications for
          -----------------------
the IGS Cores, as further specified in Exhibit A.
                                       ---------

     1.3 "IGS Cores" shall mean the IGS proprietary semiconductor circuit and
          ---------
logic design(s) and associated documentation set forth in detail in Exhibit A.
                                                                    ---------
The IGS Cores shall include all error corrections, revisions, and updates
thereto provided by IGS under this Agreement. Upon written agreement of the
parties, the definition of IGS Cores may be expanded to include other cores,
which shall be added to Exhibit A.
                        ---------

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     1.4 "IGS Licensed Product" shall mean an integrated circuit which (i)
          --------------------
incorporates any module, submodule, or any combination thereof of the Innovative
Cores or any derivative thereof, (ii) is manufactured by or for IGS; and (iii)
is marketed and sold on a component basis by or for IGS as a IGS branded product
to the general market. The definition of IGS Licensed Products does not include
Re-branded Chips, regardless of whether an Innovative Core, or a derivative
thereof, is incorporated in such Re-branded Chip.
                                 ---------------

     1.5 "IGS Test Benches" shall mean the IGS validation test benches, in
          ----------------
source code form, used for testing functionality of the IGS Cores and generating
test vectors, as set forth in Exhibit A.
                              ---------

     1.6 "Innovative Core Specifications" shall mean the technical
          ------------------------------
specifications for the Innovative Cores, as further specified in Exhibit B.
                                                                 ---------

     1.7 "Innovative Cores" shall mean the Innovative proprietary semiconductor
          ----------------
circuit and logic design(s) and associated documentation for the *** Core and
the *** Core. The Innovative Cores shall include all error corrections,
revisions, and updates thereto provided by Innovative under this Agreement.

     1.8 "Innovative Test Benches" shall mean the Innovative validation test
          -----------------------
benches, in source code form, used for testing functionality of the Innovative
Cores and generating test vectors, as set forth in Exhibit B.
                                                   ---------

     1.9 "Intellectual Property Rights" shall mean patent rights, rights of
          ----------------------------
priority, mask work rights, copyrights, moral rights, trade secrets, know-how
and any other intellectual property rights recognized in any country or
jurisdiction of the world, including, without limitation, applications for,
originals, divisionals, continuations, continuation-in-parts, reexaminations or
reissues of any of the foregoing; exclusive of trademarks, trade names, logos,
service marks, and other designations of source.

     1.10 "Net Sales" shall mean the amount received by Innovative for the
           ---------
commercial licensing of IGS Cores under this Agreement, calculated according to
GAAP, excluding amounts attributable to sales, value-add, and use taxes (as may
be applicable), reasonable discounts actually provided. In the event that
Innovative licenses the IGS Cores together with other intellectual property, and
revenues for the IGS Cores are not separately specified, the portion of such
revenues that are attributable to the IGS Cores will be calculated based on the
ratio of the list price of the IGS Cores to the total list price for all cores
licensed in such transaction. Innovative will make available to IGS the list
price of the IGS Cores, Innovative Cores and other cores to be licensed with IGS
Cores on a quarterly basis.

     1.11 "Software Drivers" shall mean source and object code versions of
Windows CE software drivers for the Innovative Cores, and source sample code, as
set forth in Exhibit A.
             ---------

     1.12 "*** Core" shall mean Innovative's proprietary *** core, as
           --------
described in Exhibit B.
             ---------

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.

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     1.13 "*** Core" shall mean Innovative's proprietary *** controller as
           --------
described in Exhibit B. When Innovative delivers to IGS the *** support, such
             ---------
*** support shall constitute part of the *** Core.

2.  GRANT OF LICENSE RIGHTS
    -----------------------

     2.1 Innovative License Grants.
         -------------------------

     2.1.1 License. Subject to the terms and conditions of this Agreement,
           -------
Innovative hereby grants to IGS a worldwide, nonexclusive, non-transferable,
royalty-free license under all Intellectual Property Rights licensable by
Innovative:

          (a) to use, copy and modify the Innovative Cores for internal use and
     for the sole purpose of designing and developing Licensed Products;

          (b) to make, manufacture, have manufactured by subcontractors, market,
     distribute, and sell the Innovative Core and derivative works thereof
     solely as incorporated in a Licensed Product; and

          (c) to use the Innovative Test Benches for internal use for the sole
     purpose of designing, developing, testing and verifying Licensed Products.

          All of the above provided, however, that all subcontractors of IGS
authorized to perform services under this Section 2.1.1 shall be bound by and
subject to the restrictions set forth in Section 5 below.

    2.1.2 Restrictions. IGS will have no right or license to sublicense,
          ------------
transfer or otherwise convey the Innovative Cores, any derivative
works thereof, the Innovative Test Benches, or any portion of the foregoing, to
any third party except as otherwise provided in this Section 2.1. Without
limiting the generality of the foregoing, IGS is expressly prohibited from (i)
designing, manufacturing, marketing, or selling Re-branded Chips and (ii)
                                                ----------------
providing the Innovative Cores, any derivative works thereof, the Innovative
Test Benches, or any portion of the foregoing, or access thereto, to any third
party as a part of an Re-branded Chip library or design kit, except as otherwise
                      ---------------
agreed to by Innovative in writing.

     2.1.3 Reservation. No license or right is granted, by implication or
           -----------
otherwise, to IGS, under any Intellectual Property Rights now or hereafter owned
or controlled by Innovative except for licenses and rights expressly granted in
this Agreement. No license is granted to IGS with respect to future Innovative
products or technologies, unless otherwise mutually agreed to by the parties.

     2.2 IGS License Grants.
         ------------------

     2.2.1 License. Subject to the terms and conditions of this Agreement, IGS
           -------
hereby grants to Innovative:

-------------
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          (a) a worldwide, nonexclusive, royalty-bearing license under all
     Intellectual Property Rights licensable by IGS embodied in the IGS Cores
     and IGS Test Benches to use, reproduce, modify, port and sublicense
     (including to Re- branded Chip vendors) the IGS Cores and IGS Test Benches,
     and to integrate or bundle the IGS Cores or IGS Test Benches with
     Innovative products under Innovative's then-current licensing scheme (i.e.
     in a manner similar to Innovative's cores); and

          (b) a worldwide, nonexclusive, royalty-free license under all
     Intellectual Property Rights licensable by IGS embodied in the Software
     Drivers to use, reproduce, modify, compile, port, and sublicense the
     Software Drivers.

     2.2.2 Reservation. No license or right is granted, by implication or
           -----------
otherwise, to Innovative, under any Intellectual Property Rights now or
hereafter owned or controlled by IGS except for licenses and rights expressly
granted in this Agreement. No license is granted to Innovative with respect to
future IGS products or technologies, unless otherwise mutually agreed to by the
parties.

     2.3 Exclusivity. IGS shall not license any of the IGS Cores on a
         -----------
stand-alone basis to third parties. Notwithstanding the foregoing, IGS shall be
permitted to license the IGS Cores to any third party where such license is in
connection with another transaction with such third party. In no event shall IGS
license any IGS Core to any of the companies listed on Exhibit C, which exhibit
                                                       ---------
may be amended from time to time by written agreement of both parties. In no
event shall Innovative license any IGS Core to any of the companies listed on
Exhibit D, which exhibit may be amended from time to time by written agreement
---------
of both parties.

     2.4 Bankruptcy Provision. All rights and licenses granted by the parties
         --------------------
hereunder are, for purposes of Section 365(n) of the United States Bankruptcy
Code (the "Bankruptcy Code"), licenses of intellectual property within the scope
           ---------------
of Section 101 of the Bankruptcy Code. Each party acknowledges that the other
party, as a licensee of such rights and licenses hereunder, will retain and may
fully exercise all of its rights and elections under the Bankruptcy Code. Each
party further acknowledges that, in the event of the commencement of a
bankruptcy or insolvency proceeding by or against it, the other party will be
entitled to a complete duplicate of (and complete access to) any such
intellectual property and all embodiments thereof.  If not already in its
possession, each party has the right to immediate delivery of such intellectual
property and embodiment upon written request: (i) upon any such commencement of
bankruptcy proceedings against the other party, unless the other party or its
representative or trustee elects to continue to perform all of its obligations
hereunder, or (ii) if not delivered under clause (i) of this Section 2.3, upon
the rejection of this Agreement by or on behalf of the other party.

3.  TECHNOLOGY TRANSFER AND SUPPORT
    -------------------------------

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     3.1 Innovative Deliverables. Innovative shall deliver the Innovative Cores
         -----------------------
and Innovative Test Benches to IGS according to the schedule set forth in
Exhibit B, and in the format identified therein.
---------

     3.2 IGS Deliverables. IGS shall deliver the IGS Cores and IGS Test Benches
         ----------------

to Innovative according to the schedule set forth in Exhibit A, and in the
                                                     ---------
format identified therein. In addition, within *** (***) days of the Effective
Date, IGS shall deliver to Innovative: (i) for each IGS Core, *** (***) packaged
semiconductor chips incorporating that IGS Core, and (ii) *** prototype 5000PCI
boards incorporating such chips.

     3.3 Software Drivers. IGS shall develop and deliver to Innovative a
         ----------------

Software Driver for each Innovative Core prior to distributing an IGS Licensed
Product incorporating such Innovative Core. During the term of this Agreement
both parties shall use reasonable efforts to have Microsoft Corporation include
the Software Drivers with its Windows CE operating system.

     3.4 Innovative Updates and Revisions. For *** commencing on the Effective
         --------------------------------
Date, and for each year thereafter in which IGS is current in its payment of the
Maintenance Fees set forth in Section 4 below, Innovative will provide to IGS,
at no additional cost, such upgrades, updates, error corrections, patches, and
maintenance revisions for the Innovative Cores and Innovative Test Benches as
Innovative develops in the ordinary course of business.

     3.5 Innovative Technical Support. For *** commencing on the Effective Date,
         ----------------------------
and for each year thereafter in which IGS is current in its payment of the
Maintenance Fees set forth in Section 4 below, Innovative will: (i) use
commercially reasonable efforts to assist IGS in integrating the *** Core with
Licensed Products, including assisting IGS in making minor modifications to the
*** Core, if necessary, and (ii) use commercially reasonable efforts to
provide technical support to IGS in the use of the Innovative Cores and
Innovative Test Benches for projects relating to the development of Licensed
Products. Innovative will make reasonable efforts to answer IGS technical
questions relating to the Innovative Cores. In addition, during the term of this
Agreement, Innovative will make reasonable efforts to investigate any error
reports from IGS regarding the Innovative Cores, and to provide IGS with a fix
for such errors.

     3.6 IGS Updates and Revisions. For *** commencing on the Effective Date,
         -------------------------

and for each year thereafter in which Innovative is current in its payment of
                                                 ---
the Maintenance Fees set forth in Section 4 below, IGS will provide to
Innovative such upgrades, updates, error corrections, patches, process ports and
maintenance revisions for the IGS Cores and IGS Test Benches as IGS develops in
the ordinary course of business. Such process ports shall include, without
limitation, any port of the IGS Cores to the *** um *** process.

     3.7 IGS Technical Support. For *** commencing on the Effective Date, and
         ---------------------
for each year thereafter in which Innovative is current in its payment of the
Maintenance Fees set forth in Section 4 below, IGS will, at Innovative's
request, review Innovative's product data sheets and documentation relating to
the IGS Cores. IGS will provide Innovative with reasonably prompt feedback on
such data sheets and documentation in order to ensure the

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accuracy and usefulness of such materials. IGS will make reasonable effort to
answer Innovative technical questions relating to the IGS cores. In addition,
during the term of this Agreement, IGS will make reasonable efforts to
investigate any error reports from Innovative regarding the IGS Cores, and to
provide Innovative with a fix for such errors.

     3.8 Test and Characterization. IGS will: (i) with Innovative's reasonable
         -------------------------
application support, commence testing of the *** Core pursuant to IGS'
standard testing procedure, and provide the resulting initial test data solely
with respect to the *** Core (the "Test Data") to Innovative within *** of
receiving first silicon that incorporates the *** and thereafter to complete
testing of the *** pursuant to such testing procedure and within *** (***)
business days of the full Test Data being available, provide such full Test Data
to Innovative; (ii) in accordance with its standard manufacturing process, have
manufactured test chips for the *** Core at different process comers, (iii)
have manufactured test boards for testing the test chips, (iv) have the test
chips assembled and tested, and (v) provide to Innovative *** (***) of the test
chips and *** (***) of the test boards. Innovative shall be permitted to use the
Test Data for any purpose, including making such materials available to its
customers. Innovative shall be permitted to use the test chips and test boards
for any purpose, including making such materials available to its customers
excluding the companies listed on Exhibit D attached hereto.

     3.9 Exclusions. Neither party shall have an obligation to provide
         ----------
maintenance or technical support services for problems resulting from (i)
neglect, misuse or damage caused by the other party to the media containing the
cores, (ii) alterations or modifications to the cores not made by or for that
party, (iii) the failure of the other party to provide and to maintain a
suitable installation environment and facilities, or (iv) the use of the cores
for purposes other than as expressly permitted by this Agreement.

4.  PAYMENTS AND OTHER CONSIDERATIONS
    ---------------------------------

     4.1 Innovative License Fee. In consideration for the licenses granted to
         ----------------------
IGS in Section 2 above, IGS shall pay Innovative a License Fee of *** U.S.
dollars ($***). IGS shall pay *** U.S. dollars ($***) of the License Fee in cash
according to the schedule set forth in Exhibit B. IGS shall pay the remaining
                                       ---------
one hundred fifty thousand U.S. dollars ($150,000) of the License Fee by selling
to Innovative sixty thousand (60,000) shares of IGS Series I Preferred Stock
("Purchased Shares") pursuant to a separate Series I Stock Purchase Agreement
------------------
and related financing agreements. No other payment shall be due to Innovative
based on IGS' exercise of the licenses granted to IGS, including without
limitation, the sale of IGS Licensed Products.

     4.2 IGS License Fees. In consideration for the licenses granted to
         ----------------
Innovative in Section 2 above, Innovative shall pay to IGS a percentage of its
Net Sales, as follows. For IGS Cores which have not been ported by Innovative to
another process ("Unported IGS Cores"), Innovative shall pay IGS *** percent
(*** %) of its Net Sales of unported IGS Cores until Net Sales exceed *** U.S.
dollars ($***), after which Innovative shall pay IGS *** percent (*** %) of any
subsequent Net Sales of Unported IGS Cores. For IGS Cores which have been ported
by Innovative to another process ("Ported IGS Cores"), Innovative shall pay IGS

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*** percent (*** %) of its Net Sales of ported IGS Cores until Net Sales exceed
*** U.S. dollars ($***), after which Innovative shall pay IGS *** percent (***
%) of any subsequent Net Sales of Ported IGS Cores. Innovative shall pay IGS any
fees due within thirty (30) days of the end of the calendar quarter during which
the fee became due.

     4.3 Maintenance Fees. Except with respect to the first twelve months of
         ----------------
this Agreement (for which the maintenance fee is included in the amount to be
paid pursuant to Section 4.1), IGS may subscribe to the upgrades, updates, error
corrections, patches, maintenance revisions, and support set forth in Sections
3.4 (Innovative Updates and Revisions) and 3.5 (Innovative Technical Support)
above by paying to Innovative a Maintenance Fee of *** dollars ($***) for each
year following the first anniversary of the Effective Date. The Maintenance Fee
for each year will be due on the anniversary of the Effective Date that marks
the beginning of such year. Innovative may subscribe to the upgrades, updates,
error corrections, patches, maintenance revisions, and support set forth in
Sections 3.6 (IGS Updates and Revisions) and 3.7 (IGS Technical Support) above
by paying to IGS a Maintenance Fee of *** dollars ($***) for each year following
the first anniversary of the Effective Date. The Maintenance Fee for each year
will be due on the anniversary of the Effective Date that marks the beginning of
such year.

     4.4 Taxes. Each party will pay all sales, use and other taxes imposed by
         -----
any applicable laws and regulations as a result of the payments made by such
party under this Agreement, other than taxes based upon the other party's net
income. If any withholding or similar tax must be paid under the laws of any
country outside of the U.S. based on the payments under this Agreement, then the
party making such payments will pay such taxes and shall increase the amounts
due to the receiving party such that the amounts received by the receiving party
after the payment of such taxes are equal to the amounts stated in this
Agreement.

     4.5 Payments. Within thirty (30) days following the last day of each
         --------
calendar month during the term of this Agreement, Innovative shall submit to IGS
a complete and accurate report stating the number of licenses to IGS Cores
granted during such calendar month by Innovative, to whom the licenses were
granted andindicating the Net Sales for each license and amounts owed to IGS
therefor. Payment with respect to any specific license is due within thirty (30)
days of Innovative's receipt of such payment from its customer. All payments
will be made in U.S. dollars. Time of payment is of the essence under this
Agreement. All amounts owed hereunder not paid within thirty (30) days of the
date when due and payable will bear interest from the date such amounts are due
and payable at the lesser of 1.5% per month, and the maximum rate permitted
under applicable law.

     4.6 Records; Audit. During the term of this Agreement and for three (3)
         --------------
years after its termination, Innovative agrees (i) to retain all usual and
proper records and books of account and all usual and proper entries relating to
licenses of IGS Cores and (ii) to allow IGS and its representative to audit
Innovative's documents, financial statements and business records in order to
verify Innovative's compliance with the terms of this Agreement, including
without limitation, the payment of the appropriate license fees. Any audit shall
be conducted during

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regular business hours on reasonable prior notice. Any audit shall be conducted
by an independent certified public accountant selected by IGS, subject to
Innovative's consent (such consent not to be unreasonably withheld or delayed).
If the audit reveals any underreporting of amounts due IGS, then Innovative
shall within thirty (30) days after notice thereof pay IGS the full amount of
the underpayment and any accrued interest running from the date payments should
have been made had the reports been accurate. If Innovative's underreporting in
any reportmade under this Agreement exceeds five percent (5%) of total amount
due to IGS for such period, then Innovative shall reimburse IGS for all
reasonable costs of the audit.

5.  CONFIDENTIAL INFORMATION
    ------------------------

     5.1 Definition of Confidential Information. Innovative and IGS acknowledge
         --------------------------------------
that, in the course of performing their respective obligations hereunder, each
may obtain information relating to the other and the other's products that is of
a confidential and proprietary nature to such other party. "Confidential
                                                            ------------
Information" means confidential and proprietary information of either party
-----------
which is (i) designated with the legend "Confidential" or comparable legend in
case of disclosure thereof in written, graphic, machine readable or other
tangible form or (ii) designated "Confidential" at the disclosure thereof in
other form and within thirty (30) days after such disclosure set forth in
writing designated "Confidential" and forwarded to the receiving party. For the
purposes of this Agreement, the Innovative Cores, the Innovative Test Benches
and the certain Innovative Core Specifications identified by Innovative shall be
considered Confidential Information of Innovative, and the IGS Cores, the IGS
Test Benches, Software Drivers and the certain IGS Core Specifications
identified by IGS shall be considered Confidential Information of IGS. The terms
of this Agreement shall be considered Confidential Information of both parties,
and shall not be subject to the exclusions set forth in Section 5.2 of this
Agreement.

     5.2 Exclusions. Confidential Information does not include information which
         ----------
(i) is or becomes public knowledge without the fault or action of the other
party or any breach of any confidentiality obligation; (ii) the other party can
document was independently developed by it without use or reference to the
Confidential Information; (iii) the other party can document was previously
known to it prior to receipt of the Confidential Information; or (iv) is
received by the other party absent confidentiality obligations from a third
party who is without confidentiality obligations with respect to such
information.

     5.3 Obligation. Innovative and IGS agree that, for a period of ten (10)
         ----------
years after the receipt of the other party's Confidential Information or for
perpetuity in the case of source code material, it will (i) use the other
party's Confidential Information only in connection with fulfilling its rights
and obligations under this Agreement; (ii) hold the other party's Confidential
Information in strict confidence and exercise due care with respect to its
handling and protection, consistent with its own policies concerning protection
of its own Confidential Information of like importance but in no instance less
than reasonable care, such due care including without limitation requiring its
employees to execute non-disclosure agreements which provide protection of the
other party's Confidential Information which is at least as protective as the

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terms and conditions of this Agreement; (iii) not disclose, divulge or publish
the other party's Confidential Information except to such of its responsible
employees and subcontractors who have a bona fide need to know to the extent
necessary to fulfill such party's obligations under this Agreement; and except
that a party may disclose the terms of this Agreement to its professional
advisors who are subject to an obligation of confidentiality; (iv) instruct all
such employees and subcontractors not to disclose the other party's Confidential
Information to third parties, including consultants, without the prior written
permission of the other party; (v) require all subcontractors permitted under
this Agreement to execute a confidentiality agreement at least as protective as
the terms and conditions of this Agreement before allowing such subcontractors
access to the Confidential Information of the other party. The parties
acknowledge and agree that the "bona fide need to know" standard set forth in
the foregoing subsection (iii) above as applied to (x) dissemination of the
Innovative Cores requires that authorized IGS employees and subcontractors must
have actual need to use the Innovative Cores for a purpose permitted under this
Agreement and (y) dissemination of the IGS Cores requires that authorized
Innovative employees and subcontractors must have actual need to use the IGS
Cores for a purpose permitted under this Agreement.

     5.4 Exceptions to Obligation. Notwithstanding the foregoing, either party
         ------------------------
may disclose Confidential Information to the extent required by law, provided
the other party uses reasonable efforts to give the party owning the
Confidential Information sufficient notice of such required disclosure to allow
the party owning the Confidential Information reasonable opportunity to object
to and to take legal action to prevent or limit such disclosure.

6.  INTELLECTUAL PROPERTY RIGHTS
    ----------------------------

     6.1 Innovative Ownership. All right, title, and interest in and to the
         --------------------
Innovative Cores, Innovative Test Benches, Innovative Core Specifications,
derivatives of the IGS Cores developed by Innovative (exclusive of the
Intellectual Property embodied in the underlying IGS Cores), and all
Intellectual Property Rights in the foregoing are the sole and exclusive
property of Innovative.

     6.2 IGS Ownership. All right, title, and interest in and to the IGS Cores,
         -------------
IGS Test Benches, IGS Core Specifications, derivatives of the Innovative Cores
developed by IGS (exclusive of the Intellectual Property embodied in the
underlying Innovative Cores), and all Intellectual Property Rights in the
foregoing are the sole and exclusive property of IGS.

     6.3 Proprietary Markings.
         --------------------

         6.3.1 IGS shall duplicate and apply Innovative's mask work notice on
               any mask incorporating an Innovative Core, subject to IGS'
               reasonable approval of the size of such notice. IGS shall include
               Innovative's copyright notice, as it appears in the source code
               version (RTL) of the Innovative Cores, in any source code copy of
               the Innovative Cores, and the source code version of any
               derivative work thereof.

         6.3.2 Innovative shall, and shall require its sublicensees to,
               duplicate and apply IGS' mask work notice on any mask
               incorporating an IGS Core.

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               Innovative shall duplicate and apply IGS' proprietary rights
               notices on all copies of the IGS documentation related to the IGS
               Cores made by Innovative.

     6.4 Third Party Patents and Warranty.
         --------------------------------

         6.4.1 IEEE *** Patents. The parties acknowledge that certain portions
               ----------------
of the technology embodied in the Innovative Cores are covered by certain third
party patents to which the IEEE [PROVIDE FULL NAME OF ENTITY] coordinates access
and that this Agreement does not constitute a license to such third party
patents, including those licensed by Apple Computer, Inc. and SGS-Thomson
Microelectronics, Ltd. IGS will be responsible for obtaining appropriate
licenses to such third party patents which will allow it to fully exercise its
license rights under this Agreement.

        6.4.2 DTLA Intellectual Property. The parties acknowledge that certain
              --------------------------
portions of the technology embodied in the *** are covered by certain third
party patents and other intellectual property to which the Digital Transmission
Licensing Administrator coordinates access and that this Agreement does not
constitute a license to such third party intellectual property, including that
intellectual property owned by Hitachi Ltd., Intel Corporation, Matsushita
Electric Industrial Co., Ltd., Sony Corporation, and Toshiba Corporation. IGS
represents and warrants that IGS will be responsible for obtaining appropriate
licenses to such third party intellectual property which will allow it to fully
exercise its license rights under this Agreement.

        6.4.3 UMC Cell Library License. The parties acknowledge that the ***
              ------------------------
Core incorporates cell libraries owned by the UMC Group, and that this Agreement
does not constitute a license to such third party cell libraries. IGS will be
responsible for obtaining appropriate licenses to use such cell libraries which
will allow it to fully exercise its license rights under this Agreement.

     6.5 Joint Ownership. Innovative and IGS will jointly own equal undivided
         ---------------
interests in the Software Drivers, without duty to account.

7.  INDEMNIFICATION
    ---------------

     7.1 Indemnification by Innovative.
         -----------------------------

          (a) Indemnification. Innovative will indemnify, hold harmless, and
              ---------------
defend IGS from and against any and all liabilities, damages, losses, costs and
expenses (including but not limited to reasonable fees of attorneys and other
professionals) payable to third parties based upon a claim that any of the
Innovative Cores or Innovative Test Benches infringe or violate any Intellectual
Property Right of any third party, provided that IGS (i) promptly notifies
Innovative of the claim; (ii) provides Innovative with all reasonable
information and assistance, at Innovative's expense, to defend or settle such a
claim; and (iii) grants Innovative authority and control of the defense or
settlement of such claim. Innovative shall not settle any such claim, without
IGS's prior written consent, if such settlement would alter, impair or reduce
the scope of

-------------
*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES
    AND EXCHANGE COMMISSION

                                       10
<PAGE>

IGS's rights in the Innovative Cores or Innovative Test Benches, would otherwise
limit IGS's exercise of its rights under this Agreement, or would require IGS to
pay any compensation or to assume any obligations including a license of IGS's
Intellectual Property Rights. IGS reserves the right to retain counsel, at IGS's
expense, to participate in the defense and settlement of any such claim.

     (b) Injunctions. If the exercise by IGS of any of the rights granted to it
         -----------
under this Agreement is enjoined or, in Innovative's reasonable opinion, is
likely to be enjoined due to the type of infringement or misappropriation
specified in Section 7.1(a) above, without prejudice to the rights and remedies
of IGS, Innovative at its option and expense, will either: (i) procure for IGS a
license to continue to exercise all of the rights granted under this Agreement
with respect to the Innovative Cores and Innovative Test Benches; (ii) modify
the allegedly infringing item to avoid the infringement or misappropriation,
without materially impairing the performance or compliance with the Innovative
Core Specifications, or the rights of IGS under this Agreement, or (iii) if
neither of the foregoing options are commercially practical, terminate this
Agreement and refund to IGS all amounts paid by IGS under this Agreement during
the twelve months immediately preceding notice of termination.

         (c) Sole Remedy. THE FOREGOING IS IGS'S SOLE AND EXCLUSIVE REMEDY FOR
             -----------
 ANY CLAIM OF INTELLECTUAL PROPERTY RIGHTS INFRINGEMENT.

         (d) Exclusions. Innovative will have no liability for any infringement
             ----------
or misappropriation claim to the extent it results from: (i) modifications of
the Innovative Cores or Innovative Test Benches other than by Innovative, if
such a claim would have been avoided but for such modification; (ii) combination
of the Innovative Cores with designs, circuits, products, processes or materials
not provided by Innovative, if such a claim would have been avoided but for such
combination; or (iii) IGS's failure to use modifications to the Innovative Cores
or Innovative Test Benches provided by Innovative to avoid infringement or
misappropriation with notice of the potential claim.

     7.2 Indemnification by IGS.
         ----------------------

         (a) Indemnification. IGS will indemnify, hold harmless, and defend
             ---------------
Innovative from and against any and all liabilities, damages, losses, costs and
expenses (including but not limited to reasonable fees of attorneys and other
professionals) payable to third parties based upon any claim that any of the IGS
Cores or IGS Test Benches infringe or violate any Intellectual Property Right of
any third party, provided that Innovative (i) promptly notifies IGS of the
claim; (ii) provides IGS with all reasonable information and assistance, at
IGS's expense, to defend or settle such a claim; and (iii) grants IGS authority
and control of the defense or settlement of such claim. IGS shall not settle any
such claim, without Innovative's prior written consent, if such settlement would
alter, impair or reduce the scope of Innovative's rights in the IGS Cores or IGS
Test Benches, would otherwise limit Innovative's exercise of its rights under
this Agreement, or would require Innovative to pay any compensation or to assume
any obligations including a license of Innovative's Intellectual Property
Rights. Innovative reserves

                                       11
<PAGE>

the right to retain counsel, at Innovative's expense, to participate in the
defense and settlement of any such claim.

     (b) Injunctions. If the exercise by Innovative of any of the rights granted
         -----------
to it under this Agreement is enjoined or, in IGS's reasonable opinion, is
likely to be enjoined due to the type of infringement or misappropriation
specified in Section 7.1(a) above, without prejudice to the rights and remedies
of Innovative, IGS at its option and expense, will either: (i) procure for
Innovative a license to continue to exercise all of the rights granted under
this Agreement with respect to the IGS Cores and IGS Test Benches; (ii) modify
the allegedly infringing item to avoid the infringement or misappropriation,
without materially impairing the performance or compliance with the IGS Core
Specifications, or the rights of Innovative under this Agreement, or (iii) if
neither of the foregoing options are commercially practical, terminate this
Agreement and refund to Innovative all amounts paid by Innovative under this
Agreement during the twelve months immediately preceding notice of termination.

     (c) Sole Remedy. THE FOREGOING IS INNOVATIVE'S SOLE AND EXCLUSIVE REMEDY
         -----------
FOR ANY CLAIM OF INTELLECTUAL PROPERTY RIGHTS INFRINGEMENT.

     (d) Exclusions. IGS will have no liability for any infringement or
         ----------
misappropriation claim to the extent it results from: (i) modifications of the
IGS Cores or IGS Test Benches other than by IGS, if such a claim would have been
avoided but for such modification; (ii) combination of the IGS Cores or IGS Test
Benches with designs, circuits, products, processes or materials not provided by
IGS, if such a claim would have been avoided but for such combination; or (iii)
Innovative's failure to use modifications to the IGS Cores or IGS Test Benches
provided by IGS to avoid infringement or misappropriation with notice to
Innovative of the potential claim.

                                       12
<PAGE>

8. WARRANTIES
   ----------

     8.1 Innovative Limited Warrant. Innovative warrants to IGS that the
         --------------------------
Innovative Cores and Innovative Test Benches will perform in all material
respects in accordance with the Innovative Core Specifications for a period of
ninety (90) days from receipt of the Innovative Cores and Innovative Test
Benches by IGS. IGS's sole remedy is that Innovative will, at no extra charge,
use commercially reasonable efforts to correct any defect discovered so that it
performs in accordance with such specification in all material respects,
provided that IGS reports such defect to Innovative during such ninety (90) day
period in writing; and provided that if Innovative cannot correct such defect,
then IGS will have the right to terminate this Agreement and receive refund from
Innovative of the amounts paid by IGS to Innovative under this Agreement. The
foregoing warranty will not apply to modifications by IGS.

     8.2 IGS Limited Warranty. IGS warrants to Innovative that the IGS Cores and
         --------------------
the IGS Test Benches will perform in all material respects in accordance with
the IGS Core Specifications for a period of ninety (90) days from receipt of the
IGS Cores and IGS Test Benches by Innovative. Innovative's sole remedy is that
IGS will, at no extra charge, use commercially reasonable efforts to correct any
defect discovered so that it performs in accordance with such specification in
all material respects, provided that Innovative reports such defect to IGS
during such ninety (90) day period in writing; and provided that if IGS cannot
correct such defect, then Innovative will have the right to terminate this
Agreement and receive refund from IGS of the amounts paid by Innovative to IGS
under this Agreement. The foregoing warranty will not apply to modifications by
Innovative.

     8.3 Disclaimer of Warranty. EXCEPT AS EXPRESSLY SET FORTH IN THIS
         ----------------------
AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY OF ANY KIND,
EXPRESS, IMPLIED OR STATUTORY, INCLUDING BUT NOT LIMITED TO WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NONINFRINGEMENT.

9. TERM AND TERMINATION
   --------------------

     9.1 Term. This Agreement will commence on the Effective Date and continue
         ----
in effect until five (5) years from the Effective Date.

     9.2 Termination due to Material Breach. If either party materially breaches
         ----------------------------------
any term or condition of this Agreement and fails to cure that breach within
thirty (30) days after receiving written notice of the breach, the other party
shall have the right to terminate this Agreement any time after the end of such
thirty (30) day period.

     9.3 Termination due to Insolvency. If either party becomes the subject of a
         -----------------------------
voluntary or involuntary petition in bankruptcy or any proceeding relating to
insolvency, receivership, liquidation, or composition for the benefit of
creditors, if that petition or proceeding is not

                                       13
<PAGE>

resolved in its favor within sixty (60) days after filing, the other party may
terminate this Agreement on thirty (30) days' prior written notice and
opportunity to cure.

     9.4 No Liability for Damages. Neither party will be liable for damages of
         ------------------------
any kind as a result of exercising its right to terminate this Agreement
according to its terms, and termination will not affect any other right or
remedy at law or in equity of either party.

     9.5 Obligations Upon Termination or Expiration. Upon any termination or
         ------------------------------------------
expiration of this Agreement, each party shall return or destroy all copies of
the Confidential Information of the other party, except for Confidential
Information required to exercise a party's surviving rights, within thirty (30)
days after the termination or expiration, and, at the request of the other
party, have an officer certify in writing that the party has complied with this
obligation.

     9.6 Survival of Obligations. The following provisions shall survive
         -----------------------
termination or expiration of this Agreement for any reason: Sections 1
(Definitions), 2 (Grant of License Rights) except that if the Agreement is
terminated for material breach of a party, licenses to such breaching party
shall not survive, 4 (Payments and Other Considerations), 5 (Confidential
Information), 6 (Intellectual Property Rights), 7 (Indemnification), 8.3-8.7
(Warranties), 9 (Term and Termination), 10 (Limitation of Liability), and 11
(General).

10. LIMITATION OF LIABILITY
    -----------------------

     10.1 General Limitation of Damages. OTHERTHAN WITH RESPECT TO THE INDEMNITY
          -----------------------------
OBLIGATIONS SET FORTH IN SECTION 7 OF THIS AGREEMENT,IN NO EVENT SHALL EITHER
PARTY BE LIABLE FOR COSTS OF PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES, LOSS
OF USE, DATA OR PROFITS, INTERRUPTION OF BUSINESS OR ANY SPECIAL, INCIDENTAL,
INDIRECT, EXEMPLARY, OR CONSEQUENTIAL DAMAGES, ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT, HOWEVER CAUSED, ON ANY THEORY OF LIABILITY, WHETHER IN AN
ACTION FOR CONTRACT, STRICT LIABILITY, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE,
AND WHETHER OR NOT THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.

     10.2 Specific Limitation. OTHERTHAN WITH RESPECT TO THE INDEMNITY
          -------------------
OBLIGATIONS SET FORTH IN SECTION 7 OF THIS AGREEMENT, THE AGGREGATE LIABILITY OF
EACH PARTY TO THE OTHER UNDER THIS AGREEMENT SHALL NOT EXCEED THE TOTAL AMOUNTS
PAID BY BOTH PARTIES UNDER THIS AGREEMENT.

     10.3 Severability. EACH AND EVERY PROVISION OF THIS AGREEMENT WHICH
          ------------
PROVIDES FOR A LIMITATION OF LIABILITY, DISCLAIMER OF WARRANTY OR EXCLUSION OF
DAMAGES IS INTENDED BY THE PARTIES TO BE SEVERABLE AND INDEPENDENT OF ANY OTHER
SUCH PROVISION. FURTHER, IN THE EVENT THAT ANY REMEDY HEREUNDER IS DETERMINED TO
HAVE FAILED OF ITS ESSENTIAL PURPOSE, ALL LIMITATIONS OF LIABILITY AND
EXCLUSIONS OF DAMAGES SHALL REMAIN IN EFFECT.

                                       14
<PAGE>

     11. GENERAL
         -------

     11.1 Governing Law. This Agreement will be governed by and interpreted in
          -------------
accordance with the laws of the state of California without reference to its
conflicts of law.

     11.2 Injunctive Relief. Each of the parties acknowledges that unauthorized
          -----------------
disclosure or use of the other party's Confidential Information or infringement
or misappropriation of the other party's Intellectual Property Rights could
cause irreparable harm and significant injury that would be difficult to
ascertain and may not be compensable by damages alone. Accordingly, the parties
agree that, in addition to any and all legal remedies, claims regarding
Intellectual Property Rights or Confidential Information may, subject to claims,
be remedied by specific performance, injunction or other appropriate equitable
relief.

     11.3 Press Releases. The parties agree to issue two press releases. The
          --------------
first press release will be issued within thirty (30) days of the Effective Date
and will describe the Innovative/IGS relationship without disclosing details of
any cores. The second press release will include information about the use of
the Innovative Cores in the first IGS Licensed Product and IGS' market. IGS will
use reasonable efforts to include a quote from its key customer in the second
press release. Both press releases shall include quotes from executives of both
parties, and shall be issued only upon mutual agreement of both parties.

     11.4 Assignment. Neither party may assign this Agreement without the prior
          ----------
written consent of the other; provided however that either party may assign this
Agreement in connection with a merger, acquisition, reorganization, or sale of
all or substantially all of its assets without such consent. Any assignment
permitted hereunder will be subject to the written consent of the assignee to
all of the terms and provisions of this Agreement. Any attempted assignment in
derogation of this section will be null and void.

     11.5 Modification and Waiver. No modification to this Agreement, nor any
          -----------------------
waiver of any rights, will be effective unless assented to in writing by the
party to be charged, and the waiver of any breach or default shall not
constitute a waiver of any other right hereunder or any subsequent breach or
default.

     11.6 Notices. Any required or permitted notices hereunder must be given in
          -------
writing at the address of each party set forth below, or to such other address
as either party may substitute by written notice to the other in the manner
contemplated herein, by one of the following methods: hand delivery; registered,
express, or certified mail, return receipt requested, postage prepaid;
nationally-recognized private express courier; or facsimile. Notices will be
deemed given on the date when hand delivered or transmitted by facsimile, five
(5) days after being sent by express mail or nationally-recognized private
express courier, and ten (10) days after being sent by registered or certified
mail.

     To Innovative:                     To IGS:
     -------------                      ------

     Innovative Semiconductors, Inc.    IGS Technologies
     465 Fairchild Drive, Ste 228       4001 Burton Drive

                                       15
<PAGE>

     Mountain View, California 94043    Santa Clara, CA
     Attention: Nabil Takla             Attention: Jack Guedj
                                                   ----------
                President               President
     Phone: (650) 943-0170              Phone:  (408)   982-8588
                                              -------------------
     Fax: (650) 943-0174                Fax:   (408)   982-8591
                                            ---------------------

     Copy to:
     Fenwick & West LLP
     Two Palo Alto Square
     Palo Alto, CA 94306
     Attn.: Hirohisa Tachibana, Esq.

     11.7 Compliance with Law, including U.S. Export Laws. Each party agrees to
          -----------------------------------------------
comply with all applicable international, national, state, regional and local
laws and regulations in performing its duties hereunder and in any of its
dealings with respect to the technical information disclosed hereunder or direct
products thereof Neither party shall export or reexport, directly or indirectly,
any technical information disclosed hereunder or direct products thereof to any
destination prohibited or restricted by the export control laws and regulations
of the United States, including the U.S. Export Administration Regulations,
without the prior authorization form the appropriate governmental authorities.

     11.8 Force Majeure. Neither party shall be responsible for delay or failure
          -------------
in performance caused by any government act, law, regulation, order or decree,
by communication line or power failures beyond its control, or by fire, flood or
other natural disasters or by other causes beyond its reasonable control, nor
shall any such delay or failure be considered to be a breach of this Agreement.
In any such event, performance shall take place as soon thereafter as is
reasonably feasible.

     11.9 Headings. The headings of the Sections of this Agreement are for
          --------
convenience only and will not be of any effect in construing the meanings of the
Sections.

     11.10 Counterparts. This Agreement may be executed in multiple
           ------------
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.

     11.11 Independent Contractors. In performing their respective duties under
           -----------------------
this Agreement, each of the parties will be operating as an independent
contractor. Nothing contained herein will in any way constitute any association,
partnership, or joint venture between the parties hereto, or be construed to
evidence the intention of the parties to establish any such relationship.
Neither party will have the power to bind the other party or incur obligations
on the other party's behalf without the other party's prior written consent.

     11.12 Severability. In the event that it is determined by a court of
           ------------
competent jurisdiction that any provision of this Agreement is invalid, illegal,
or otherwise unenforceable, such provision will be enforced as nearly as
possible in accordance with the stated intention of the parties, while the
remainder of this Agreement will remain in full force and effect and bind

                                       16
<PAGE>

the parties according to its terms. To the extent any provision cannot be
enforced in accordance with the stated intentions of the parties, such
provisions will be deemed not to be a part of this Agreement.

     11.13 Entire Agreement. This Agreement and the exhibits attached hereto
           ----------------
constitute the entire and exclusive agreement between the parties hereto with
respect to the subject matter hereof and supersede any prior agreements between
the parties with respect to such subject matter.

                                       17
<PAGE>

IN WITNESS WHEREOF, Innovative and IGS have caused this Agreement to be executed
by their duly authorized representatives as of the Effective Date.

<TABLE>
<CAPTION>
Innovative Semiconductor, Inc.                    IGS Technologies
<S>                                              <C>

By:  /s/    Nabil Takla                                   /s/  Jack Guedj
   ---------------------------------              -----------------------------------------------
Name:   Nabil Takla                                            Jack Guedj
     -------------------------------              ---------------------------------------

Title:   President                                             President
      ------------------------------              -----------------------------------------------

</TABLE>

Exhibits

     Exhibit A             Description and Specifications of the IGS Technology
     Exhibit B             Description and Specifications of the Innovative
                           Technology
     Exhibit C             IGS Excluded Company List
     Exhibit D             Innovative Excluded Company List
     Exhibit E             IGS Articles

                                       18
<PAGE>

                                   EXHIBIT A
                                   ---------

                 DESCRIPTION & SPECIFICATIONS OF IGS TECHNOLOGY

IGS Cores:

Delivery Schedule:

IGS Core Specifications:

IGS Test Benches:

Software Drivers:

                                       19
<PAGE>

                                   EXHIBIT B
                                   ---------

             DESCRIPTION & SPECIFICATIONS OF INNOVATIVE TECHNOLOGY

Innovative Cores:

     ***:

     *** with ***:

Delivery Schedule:

     *** (w/out ***):                              *** after Effective Date

     ***:                                          *** after Effective Date

     *** support:                                  *** after Effective Date

Schedule of Payments from IGS:

     Effective Date:                               $***

     Delivery of *** (w/out ***):                  $***

     Delivery of ***:                              $***

     Delivery of *** support:                      $***

     Earlier of first tape-out or ***:             $***

     Earlier of first silicon verification or ***: $***

Innovative Core Specifications:

     ***:

     *** with ***:

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
    EXCHANGE COMMISSION.

                                       20
<PAGE>

Innovative Test Benches:

                                      21

                                   Exhibit B

<TABLE>
<CAPTION>
             ***                                                 ***
                                                                  *** Layer Core                  [LOGO]

                                   Product Brief                               Innovative Semiconductors, Inc.
<S>                                <C>                                          <C>

***(TM)                            IEEE ***
*** Core Family                    IEEE *** is a high-speed serial bus
 .  ***: General purpose Link       standard that allows video and audio
 .  ***: Link compatible with       consumer devices to communicate quickly,     |  |  |  |
   Texas Instrument's GPLynx(TM)   reliably, and inexpensively with a PC and    |  |  |  |
 .  ***: PCI to *** Link            with each other.                             |  |  |  |
 .  ***: Audio/Video Link
 .  ***: ***                        *** Architecture Innovative
 .  ***: Backplane ***              Semiconductors' *** architecture             scripts, and user documentation.
 .  ***: *** Test Bench &           is based on a set of parameterized
   Validation Suite                building blocks that can be quickly and      Features
                                   easily configured to support a wide
                                   range of *** applications.                   .  Compliant with IEEE *** v2.0
[LOGO]                                                                             specification
                                   The *** core family includes general         .  Interoperates with ***-1995 devices
                                   purpose and application-specific cores       .  Supports 100, 200, and 400 Mbits/sec
                                   for both *** and *** Layer controllers.         transfer rates
Innovative                                                                      .  Includes both analog and digital
Semiconductors, Inc.               *** offers the fastest and most                 portions
                                   reliable way to incorporate ***              .  Digital portion is available in
465 Fairchild Drive                capabilities into products such as              synthesizable RTL
Suite 227                          digital cameras, audio/video devices,        .  Analog portion can be ported to
Mountain View, CA 94043            disk controllers, and other PC                  commercial digital CMOS processes
Tel 650-934-0170                   peripherals.                                 .  Interoperates with Innovative's line
Fax 650-934-0174                                                                   of application-specific *** cores
www.isi96.com                      *** Core                                     .  Configurable number of ports and
-------------                      The *** includes both the analog and            port speeds
 Japan                             digital logic for a ***-compliant PHY        .  Supports *** advanced power
Kanematsu                          Layer controller, and is capable of             management
Design Technology Corp             operating at transfer rates up to 400        .  Supports all *** arbitration and
Ichikawa Bldg. 5-13-3 Ginza        Mbits/sec.                                      concatenation enhancements
Chuo-ku, Tokyo 104-0061                                                         .  Proprietary skew management
Tel 81-3-3543-7404                 The digital portion of the ***                  techniques ensure timing is met
Fax 81-3-3543-7407                 implements the arbitration and decoding      .  Extensive testing includes IDDq,
                                   logic and synchronizing FIFO, and is            alternate frequency operation,
                                   available in synthesizable RTL.                 ultra-slow operation, precise clock
[LOGO]         [LOGO]                                                              control, scan, and on-Tester
                                   The analog portion implements the               Transceiver Transmit/Receive Mode
                                   transmit and receive logic, and can be
                                   ported to commercially-available digital
                                   CMOS processes of .35(mu) or smaller.

                                   The *** is compatible with
                                   Innovative's line of ***-compliant
                                   *** cores, for a complete ***
                                   solution.

                                   The *** includes a comprehensive test
                                   bench and validation suite, synthesis

                                   Copyright(C) 1998 Innovative
                                   Semiconductors, Inc.                                                            12/98
                                   *** is a trademark of Innovative
                                   Semiconductors, Inc.

</TABLE>

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
<PAGE>

<TABLE>
<CAPTION>
             ***                                                 *** Audio/Video
                                                                  *** Layer Core                 [LOGO]

                                   Product Brief                               Innovative Semiconductors, Inc.
<S>                                <C>                                         <C>

***(TM)                            IEEE ***
*** Core Family
 .  ***: General purpose   Link     IEEE *** is a high-speed serial bus         [GRAPHIC]
 .  ***: Link compatible with       standard that allows video and audio
   Texas Instrument's GPLynx(TM)   consumer devices to communicate quickly,
 .  ***: PCI to *** Link            reliably, and inexpensively with a PC and
 .  ***: Audio/Video Link           with each other.
 .  ***: ***
 .  ***: Backplane ***              ***(TM) Architecture Innovative
 .  ***: *** Test Bench &           Semiconductors' *** architecture is based
   Validation Suite                on a set of parameterized building blocks   Features
                                   that can be quickly and easily configured
                                   to support a wide range of *** applications.   . Compliant with IEEE 1394a Link Layer
[LOGO]                                                                              specification
                                   The *** core family includes general purpose   .  Supports IEC 61883 standard
                                   and application-specific cores for both ***    .  Supports 100, 200, and 400 Mbits/sec
                                   and *** Layer controllers.                        transfer rates
Innovative                                                                        .  Works with Innovative's ***
Semiconductors, Inc.               *** offers the fastest and most                   Layer core, or with commercial
                                   reliable way to incorporate ***                   *** chips
465 Fairchild Drive                capabilities into products such as             .  Based on parameterized building
Suite 227                          digital cameras, audio/video devices,             blocks that can be configured for a
Mountain View, CA 94043            disk controllers, and other PC                    wide range of A/V applications
Tel 650-934-0170                   peripherals.                                   .  Performs jitter compensation
Fax 650-934-0174                                                                  .  Supports CIP, PCR and FCP
www.isi96.com                      *** Core                                       .  Provides full *** support,
--------------------------------   The *** provides the interface to                 plus some Transaction Layer and Bus
Japan                              connect MPEG-2/DVC devices to high speed          Management functions
Kanematsu                          *** serial bus, at speeds up to 400            .  Supports asynchronous and
Design Technology Corp             Mbits/sec.                                        isochronous transfers, including
Ichikawa Bldg. 5-13-3 Ginza                                                          multi-channel isochronous receive
Chuo-ku, Tokyo 104-0061            The core can be used in set-top boxes,         .  Cycle master capable
Tel 81-3-3543-7404                 digital TV/VCRs, video PCs, or any             .  8, 16, or 32-bit application bus
Fax 81-3-3543-7407                 application that requires MPEG-2/DVC              interfaces to common embedded processors
                                   format isochronous data transfer               .  Dynamically configurable FIFO
[LOGO]         [LOGO]              according to the IEC 61883 specification.         functionality, number, and size
                                                                                  .  Detects late packet and sequence
                                   The *** can be integrated with                    errors
                                   Innovative's *** Mixed Signal PHY core         .  Performs 32-bit CRC generation and
                                   for a single-chip 1394a Audio/Video               error detection.
                                   solution.

                                   The *** is available in synthesizable
                                   RTL, and includes a comprehensive test
                                   bench and validation suite, synthesis
                                   scripts, and user documentation.

                                   Copyright(C) 1998 Innovative
                                   Semiconductors, Inc.
                                   *** is a trademark of Innovative                                                12/98
                                   Semiconductors, In
</TABLE>

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
<PAGE>
                                    Exhibit B

<TABLE>
<CAPTION>
             ***                                     *** Test Bench and
                                                        Validation Suite                         [LOGO]

                                   Product Brief                                Innovative Semiconductors, Inc.
<S>                                <C>                                          <C>

***(TM)                            IEEE ***
*** Core Family
 .  ***: General purpose   Link     IEEE *** is a high-speed serial bus                       [GRAPHIC]
 .  ***: Link compatible with       standard that allows video and audio
   Texas Instrument's GPLynx(TM)   consumer devices to communicate quickly,
 .  ***: PCI *** Core               reliably, and inexpensively with a PC and
   with DMA                        with each other.
 .  ***: Audio/Video Link
 .  ***: ***                        ***(TM) Architecture Innovative
 .  ***: Backplane ***              Semiconductors' *** architecture is based                 [GRAPHIC]
 .  ***: *** Test Bench &           on a set of parameterized building blocks
   Validation Suite                that can be quickly and easily configured
                                   to support a wide range of *** applications.
[LOGO]
                                   The *** core family includes general         Features
                                   purpose and application-specific cores       .  Provides thorough coverage of
                                   for both *** and *** Layer controllers.      .  ***-compliant asynchronous and
Innovative                                                                         isochronous Link behavior
Semiconductors, Inc.               *** offers the fastest and most              .  Simple interface for easy addition
                                   reliable way to incorporate ***                 of tests and applications
465 Fairchild Drive                capabilities into products such as           .  Pseudo-random and nested loop
Suite 227                          digital cameras, audio/video devices,           sequencing, configurable through simple
Mountain View, CA 94043            disk controllers, and other PC                  parameters
Tel 650-934-0170                   peripherals.                                 .  All internal buses and events are
Fax 650-934-0174                                                                   observable
www.isi96.com                      *** Test Bench and Validation Suite          .  All modules support trace
--------------------------------                                                .  Automatically configures system
 Japan                             The *** provides a top level simulation         model for FIFO RAM size and host memory
Kanematsu                          test bench and set of validation programs       size
Design Technology Corp             to verify functional correctness of a        .  Model builder provided to simplify
Ichikawa Bldg. 5-13-3 Ginza        *** core per the *** specification.             creation of specific node topologies
Chuo-ku, Tokyo 104-0061                                                         .  Included with all *** family
Tel 81-3-3543-7404                 The test bench is organized as a series         cores, also available separately
Fax 81-3-3543-7407                 of layers, with configuration and test
                                   setup done at the highest levels for
                                   maximum ease of use.
[LOGO]         [LOGO]
                                   The *** includes a set of model builder
                                   scripts that make it easy to set up test
                                   scenarios using different node topologies.

                                   The *** Test Bench and Validation Suite
                                   package is included with each core in
                                   Innovative's *** family, or it can
                                   be purchased separately.

                                   Copyright(C) 1998 Innovative
                                   Semiconductors, Inc.                                                             4/99
                                   *** is a trademark of Innovative
                                   Semiconductors, Inc.
                                   All other trademarks are the property of
                                   their respective owners.
</TABLE>

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
<PAGE>

                                   EXHIBIT C

                           ISG EXCLUDED COMPANY LIST

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***

***

***

***

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXHCNAGE COMMISSION.

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                                   EXHIBIT D

                        INNOVATIVE EXCLUDED COMPANY LIST

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***

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*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXHCNAGE COMMISSION.

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                                  EXHIBIT E

                                IGS ARTICLES

                                      24<PAGE>

                                                                   Exhibit 10.11

CONFIDENTIAL TREATMENT REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT
HAVE BEEN REDACTED AND HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION.

                     AUDIO TECHNOLOGY LICENSING AGREEMENT

     This Audio Technology Licensing Agreement (the "Agreement") is made this
26th day of June, 1997 (the Effective Date") between T-Square Design, Inc., a
California corporation with its principal place of business at 4633 Old
Ironsides Drive, Ste. 290, Santa Clara, California 95054 ("T-Square") and
InteGraphics Systems, Inc., a California Corporation with its principal place of
business at 4001 Burton Drive, Santa Clara, California 95054, ("IGS").  (As used
herein, "party" or Parties" will refer to T-Square Design, Inc., InteGraphics
Systems, or both, as the case may be.)

RECITALS

     T-Square Design, Inc. has developed and is developing certain proprietary
semiconductor technology and products, including but not limited to *** Audio
Technology.

     IGS has developed and is developing certain graphics controller-based
products and technology targeting the Multimedia Technology Industry which
includes the integration of Graphics and Audio products, (Audio/Graphics
Integrated Circuit), and is in the business of manufacturing Graphics/Multimedia
Products, and marketing, selling and supporting these Graphics/Multimedia
Products.

     Both Parties desire that IGS be licensed to develop, manufacture, market
and sell integrated circuit based Audio/Graphics Products which incorporate T-
Square Design, Inc.'s *** Audio Technology implemented in the Audio Engine,
Software Drivers, Source Code, and technical/marketing support described herein.

TERMS AND CONDITIONS

1.   Definitions:

     The following terms when used in this Agreement shall have the meanings
ascribed to them in Section 1;

1.1  "*** Audio Technology" shall mean:

     The Audio Engine hardware, software specifications, and marketing/technical
support as more completely described in Section 4, that enables the
incorporation of the Audio function on to the Graphics Controller Chip,
including but not limited to the items defined below in Sections 1.2, 1.3, 1.4,
1.5, and 1.6

     All information, inventions, ideas, concepts, discoveries, algorithms,
procedures, techniques, solutions, technology, technical documentation, designs
(including circuit designs), simulation and other models, materials and know-how
associated with the design, development, testing, construction, use and
distribution of such *** Audio Technology with IGS Graphics Controller Designs
as part of Integrated Audio/Graphics Controller Chips, whether developed by IGS
or T-Square Design.

1.2  "T-Square Design, Inc. *** Audio Product Specification" shall mean the
     hardware and software product specifications developed by T-Square Design,
     Inc. for the IGS Graphics/Audio Integrated Circuit.

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<PAGE>

1.3  "Compatible" or "Compatibility" shall mean that T-Square's Audio Engine
     hardware and all necessary supporting Software is compatible with IGS's
     Graphic Controller Integrated Circuit such that the resulting
     Audio/Graphics Integrated Circuit can perform both graphics and audio
     functions at a *** Marketplace level of acceptability in a *** and ***
     environment.

1.4  "Intellectual Property Rights" of a Party means any and all rights of the
     Party in and to all patents, patent applications, copyrights, trademarks,
     trade secrets and know-how, mask work rights, industrial design and other
     proprietary rights of any kind, recognised in any country of the world,
     whether or not perfected, owned (or licensed by the Party with the right to
     grant sub-licenses of the scope granted herein) as of the Effective Date or
     hereafter acquired (whether by creation, transfer, license with right of
     sub-license or by any other means) during the term of this Agreement.

1.5  "Unit Shipments" shall mean the gross number of Integrated Circuits using
     the T-Square *** Audio Technology, shipped to customers of IGS, less any
     returned units for which a refund or credit is given.

1.6  Licensed ICs or Licensed Technology. shall mean any and all of the ***
     Audio Technology hardware and software licensed by T-Square to IGS under
     this Agreement.

2.   Grant of Rights

2.1  Marketing Rights:  IGS shall have non-exclusive marketing rights of the T-
     Square *** Audio Technology as integrated with graphics controllers.

2.2  Integration Rights: Subject to the terms and conditions of this Agreement,
     T-Square Design, Inc. hereby grants to IGS a non-exclusive license to use
     this licensed Audio Technology for products other than Graphics/Audio
     integration after March 31, 1998.

2.3  Manufacturing and Distribution Rights: Subject to the terms and conditions
     of this Agreement, T-Square Design, Inc. hereby grants to IGS a non-
     exclusive, world-wide, non-transferable, non-assignable, royalty-bearing
     license to make, have made, manufacture, reproduce, use, market, distribute
     and sell the *** Audio Technology, solely in connection with making, having
     made, manufacturing, reproducing, using, marketing, distributing and
     selling licensed ICs.

2.4  Sub-licensing Rights:  Neither IGS nor its customers can sub-licensing the
     licensed audio technology.

2.5  Use of Documentation: T-Square Design, Inc. grants to IGS a non-exclusive,
     world-wide, fully paid-up, non-transferable, non-assignable license under
     T-Square Design. Inc. Intellectual Property Rights to use, copy, modify and
     distribute information other than Confidential Information as defined in
     Section 8 of this Agreement for IGS's internal use and for creating and
     publishing technical documentation to assist IGS's customers to use the
     Audio/Graphics Chips. Notwithstanding anything in this Agreement to the
     contrary, IGS will not disclose T-Square's Confidential Information without
     the prior written consent of T-Square Design, Inc.

2.6  Limitations: No license or right is granted, by implication or otherwise,
     to IGS, under any patents, confidential information or other intellectual
     property rights now or hereafter owned or controlled by T-Square Design,
     Inc. except for licenses and rights expressly granted in this Agreement.

2.7  Notification On Licensing: T-Square shall notify IGS if T-Square license
     this *** Audio Technology for purposes of integrating *** Audio Technology
     with Graphics Integrated Circuit technology to any newly licensed IC
     company, designer, developer, manufacturer, or technology entity, prior to
     March 31, 1998.

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
<PAGE>

2.8  Licensing And Distribution: IGS shall have the right to distribute the
     object code of the software for T-Square's *** Audio Technology only with
     the licensed IC. IGS may sub-license the software source code to OEM
     customers of IGS for use with the licensed IC only.

3.   Obligations

3.1  IGS Support. Notwithstanding the obligations of T-Square to provide
     adequate engineering human resources for the delivery of the *** Audio
     Technology as contained herein, IGS will provide additional necessary human
     resources and all financial resources necessary to promote and support this
     licensed technology.

3.2  Engineering Support. IGS will supply reasonable resources and support to
     adapt the audio engine hardware and software core from T-Square. 3.3 Other
     Support. IGS will provide all necessary equipment for layout, tape out,
     revisions and debug of the sample silicon.

3.4  Modifications or Improvements. T-Square agrees that any modifications or
     improvements it makes or receives, limited to changes of the existing logic
     and circuit design that are offered to other *** Audio Technology licensees
     at no charge, including those made by other Graphics Controller companies
     but exclusive of any similarly granted licensee-specific layout
     optimizations, process migrations, or improvements in technology covered by
     other patents or patent applications, which are now or hereafter owned or
     controlled by T-Square but not as yet made to the IGS Graphics/Audio chip,
     shall be made immediately available to IGS at no additional charge if those
     improvements will, in T-Square's and IGS's judgement, place IGS's products
     in a non-competitive or non-compatibility position. Any modifications or
     improvements for which T-Square must pay a license fee or royalty, and T-
     Square acquires sub-license rights to, will be made available to IGS at a
     similar license fee and royalty schedule.

4.   *** Audio Technology Delivery and Support

4.1  Hardware.  T-Square will deliver to IGS a complete package of *** Audio
     Technology which shall include but is not limited to the following:

     (a)  Complete Verilog, RTL level and behaviour model of the Audio Engine
     (b)  Low level schematics and/or netlist of the Audio Engine
     (c)  Test vectors for verifying the audio engine prior to tape out (which
          will be used for IC mass production.
     (d)  Debug the sample silicon and solve any problem relative to
          functionality, compatibility and stability of the Audio Engine.
     (e)  Provide demo board schematics and debugging assistance

4.2  Software.  T-Square shall provide the following software deliverables as
     part of the *** Audio Technology:
     (a)  Source code of ***, *** and *** drivers
     (b)  Source code of audio chip level diagnostics and board testing software
     (c)  Complete set of wave sample for General *** compatible synthesizer
     (d)  Source code for General *** interpreter for *** games (***)
     (e)  Source code of *** to *** converter for *** games (***)

4.3  Marketing Support.  T-Square shall supply the following:

     (a)  Product training for the Audio Market
     (b)  Product specification and comparison for Audio segment

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<PAGE>

     (c)  Hardware and software compatibility testing on audio feature
     (d)  Customer support in the form of joint visits to IGS's customers with
          IGS's Sales, Marketing, and Engineering personnel.

5.  Royalties and Other Payment Terms

The royalty license fee schedule as enumerated below shall pertain to all chips
sold by IGS which are a derivative of the *** Audio Technology with audio engine
hardware and/or software licensed from T-Square under this Agreement.

5.1  Royalty Payments. Royalties as specified under this Agreement, shall be
     payable to T Square by IGS within 30 (thirty) days of the close of each
     fiscal quarter for all licensed ICs incorporating the *** Audio Technology
     licensed under this Agreement at $*** per unit.

5.2  Non-Recurring Expanse.  A total of $*** design transfer fee will be paid by
     IGS to T-Square upon the date of execution of this Agreement.

5.3  Software Source Code Sub-Licensees Fee: Each sub-licensee must sign a
     software license agreement with T-Square and pay a one-time software source
     code license fee of $***. Software source code license fees shall be waived
     by T-Square or refunded to any IGS customer when said fee has been paid in
     advance whenever such customer has purchased in excess of *** licensed ICs
     in any given fiscal quarter. IGS will treat T-Square's source code with the
     same care and protective measures as it would treat it's own source code.

5.4  Fair Market Price Consideration. In the event IGS sells chips using the
     licensed technology at a price substantially lower than the fair market
     price, or in such event that the fair market price should fall below the
     level of sufficient margin to the extent that royalty payments to T-Square
     by IGS would cause a loss to IGS, T-Square is not obligated but will
     consider waive the royalty payment requirement or issue a credit to IGS as
     is mutually agreed upon.

6.   Confidential Information:

6.1  Definition. T-Square and IGS acknowledge that, in the course of performing
     their respective obligation hereunder, each may obtain information relating
     to the other and the other's products that is of a confidential and
     proprietary nature to such other Party("Confidential Information"). Such
     Confidential Information includes without limitation the Graphics
     Controller Technology, *** Audio Technology, trade secrets, know-how
     formulas, composition of matter, inventions, techniques, process, programs,
     diagrams, schematics, technical information, customer and financial
     information, sales and marketing plans and the terms of this Agreement.

6.2  Obligation.  Each of T-Square and IGS agrees, for itself and its
     subcontractors that it will

     (a)  use the other Party's Confidential Information only in connection with
          fulfilling its obligations under this Agreement;
     (b)  hold the other Parties Confidential Information in strict confidence
          and exercise due care with respect to its handling and protection,
          consistent with its own policies concerning protection of its own
          Confidential Information of like importance;
     (c)  not disclose, divulge or publish the other Party's Confidential
          information except to such of its responsible employees and
          subcontractors who have a bona fide need to know to the extent
          necessary to fulfil such Party's obligations under this Agreement; and
     (d)  instruct all such employees not to disclose the other Party's
          Confidential Information to third parties, including consultants,
          without the prior written permission of the other party.

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
<PAGE>

6.3  Exceptions  The obligations set forth in Section 8.2 above will not apply
     to either Party's Confidential Information which

     (a)  is or becomes public knowledge without the fault or action of the
          other Party;
     (b)  received by the other Party from a third party, without restriction as
          to use or disclosure;
     (c)  the other Party can document was independently developed by it;
     (d)  is required to be disclosed pursuant to law provided the other Party
          uses reasonable efforts to give the Party owning the Confidential
          Information reasonable notice of such required disclosure; or
     (e)  is or becomes available to the other Party on an unrestricted basis
          from the Party owning the Confidential Information.

6.4  Employer Non-Disclosure Agreement

     IGS represents that to the best of its knowledge, at the Effective Date,
all IGS employees with access to all or part of the T-Square's confidential
document have executed written IGS employee non-disclosure agreements or are
otherwise under written obligation of non-disclosure which, inter alia, require
such employees to maintain the confidentiality of confidential Information of
third parties received by IGS.  IGS agrees that during the Term of this
Agreement, it shall use reasonable efforts to assure that all additional IGS
employees will execute IGS employee non-disclosure agreements prior to having
access to the T-Square *** Audio Technology.  Signed employee non-disclosure
agreements are to be retained by IGS for a period of no less than three (3)
years from the date of the employee's termination.

     T-Square represents that to the best of its knowledge, at the Effective
Date, all T-Square employees with access to the IGS Graphics Controller
Technology have executed written T-Square employee non-disclosure agreements or
are otherwise under written obligation of non-disclosure agreements which, inter
alia, require such employees to maintain the confidentiality of Confidential
Information of third parties received by T-Square Design, Inc.  T-Square Design,
Inc. agrees that during the Term if this Agreement, it shall use reasonable
efforts to assure that all additional T-Square employees will execute T-Square
employee non-disclosure agreements prior to having access to the IGS Graphics
Controller Technology.  Signed employee non-disclosure agreements are to be
retained by T-Square for a period of no less than three (3) years from the date
of the employee's termination.

7.   Intellectual Property Rights

7.1  *** Audio Technology. The *** Audio Technology and all Intellectual
     Property Rights therein will be the sole and exclusive property of T-
     Square, and IGS hereby transfers and assigns to T-Square all right, title
     and interest that IGS may have in the *** Audio Technology and all
     Intellectual Property Rights therein based on the T-Square Audio
     Technology. IGS will provide reasonable assistance and co-operation to T-
     Square to acquire, transfer, maintain, perfect and enforce the Intellectual
     Property Rights in the *** Audio Technology including but not limited to
     execution of such documents as may reasonable be requested by T-Square

7.2  Intellectual Property Indemnification. T-Square will apply its best effort
     to defend IGS against any claim that the *** Audio Technology and/or
     supporting software source code, object code, or drivers, as supplied by T-
     Square infringes or misappropriates the intellectual Property Rights of any
     third party.

8.  Term and Termination

8.1  Both Parties are binding by this agreement which can only be terminated by
     mutual agreeable terms in written signed by both Parties' officers.

8.2  Return of Confidential Information. Each Party shall return or destroy all
     copies of the Confidential Information of the other Party within thirty
     (30) days after the effective date of the termination. At the

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
<PAGE>

     request of either Party, an officer of the other Party will certify in
     writing that such other Party has complied with this obligation.

9.   Warranties and Liability

9.1  Limited Warranty.  T-Square warrants to IGS that the *** Audio Technology,
     Software Source Code and Object Code will perform in all material respects
     in accordance with T-Square's specifications as contained herein. IGS's
     sole remedy is that T-Square will, at no extra charge, correct any defect
     discovered in the Audio/Graphics chip design so that it performs in
     accordance with such specification in all material respects. In case the
     Audio/Graphics chip does not meet its functional specification, T-Square
     will apply its best effort to correct any defect.

9.2  Liability. Neither Party is liable to the other party for any damage or
     loss cost by the usual risks, delays and malfunction of the licensed
     products.

10.  Miscellaneous

10.1 Governing Law. This Agreement shall be governed by and interpreted in
     accordance with the substantive laws of the State of California or the
     United States, as applicable. Except for claims regarding either Party's
     Intellectual Property Rights or Confidential Information, all claims will
     be resolved through mediation by a mutually acceptable mediator to be
     chosen by the parties within 30 days after written notice by one Party to
     the other demanding mediation. Neither Party may unreasonably withhold
     consent to the selection of a mediator, and the parties will share the
     costs of mediation equally. Claims regarding Intellectual Property Rights
     or Confidential information may be brought immediately in the state or
     federal courts having personal jurisdiction over the Party defending the
     claim. Each of the parties acknowledges that unauthorised disclosure or use
     of the other Party's Confidential Information or infringement or
     misappropriation of the other Party's Intellectual Property Rights could
     cause irreparable harm and significant injury that would be difficult to
     ascertain and may not be compensated by damages alone. Accordingly, the
     parties agree that, in addition to any and all legal remedies, claims
     regarding Intellectual Property Rights or Confidential Information may be
     remedied by appropriate equitable relief.

10.2 Assignment. IGS shall not assign this Agreement and all of it's rights
     pertaining thereto to other party without prior written approval from T-
     Square's officer.

10.3 Modification and Waiver. No modification to this Agreement, nor any waiver
     of any rights, will be effective unless assented to in writing by the Party
     to be charged, and the waiver of any breach or default shall not constitute
     a waiver of any other right hereunder or any subsequent breach or default.

10.4 Notices. Any required or permitted notices hereunder must be given in
     writing at the address of each Party set forth below, or to such other
     address as either Party may substitute by written notice to the other in
     the manner contemplated herein, by one of the following methods: hand
     delivery; registered, express, or nationally-recognised private express
     courier; or facsimile. Notices will be deemed given on the date when hand
     delivered or transmitted by facsimile, one (1) day after being sent by
     express mail or nationally recognised private express courier, and five (5)
     days after being sent by registered or certified mail.

If to T-Square:

Tony Chu, President & CTO
T-Square Design, Inc.
4633 Old Ironsides Dr. Ste 290 Santa Clara, CA 95054

If to IGS

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
<PAGE>

Kenny Liu, President
InteGraphics Systems, Inc.
4001 Burton Drive, Santa Clara, CA 95054

10.5  Force Majeure. Nether Party shall be responsible for delay or failure in
      performance caused by any government act, law, regulation, order or
      decree, by communication line or power failures beyond its control, or by
      fire, flood or other natural disasters or by other causes beyond its
      reasonable control, nor shall any such delay or failure be considered to
      be a breach of this agreement. In any such event, performance shall take
      place as soon thereafter as is reasonably feasible.

10.6  Attorney's Fees. In the event of any dispute resolution proceeding between
      the parties hereunder, the prevailing party shall be entitled to recover
      its costs and reasonable attorney's fees therein. A "prevailing party"
      shall mean a party who receives all or substantially all of the relief
      sought by such party.

10.7  Counterparts. This Agreement may be executed in multiple counterparts,
      each of which will be deemed an original, but all of which together will
      constitute one and the same instrument.

10.8  Independent Contractors. In performing their respective duties under this
      Agreement, each of the parties will be operating as an independent
      contractor. Nothing contained herein will in any way constitute any
      association, partnership, or joint venture between the parties hereto, or
      be construed to evidence the intention of the parties to establish any
      such relationship.

10.9  Severability. In the event that it is determined by a court of competent
      jurisdiction that any provision of this Agreement is invalid, illegal, or
      otherwise unenforceable, such provision will be enforced as nearly as
      possible in accordance with the stated intention of the parties, while the
      remainder of this Agreement will remain in full force and effect and bind
      the parties according to its terms. To the extent any provision cannot be
      enforced in accordance with the stated intentions of the parties, such
      provision will be deemed not to be a part of this Agreement

10.10 Headings. The heading of the Sections and subsections of this Agreement
      are for convenience only and will not be of any effect in construing the
      meanings of the Section and subsections.

10.11 Entire Agreement. This Agreement and the exhibits attached hereto
      constitute the entire and exclusive agreement between the parties hereto
      with respect to the subject matter hereof.

Attachment

T-Square Game-Audio Engine Data Sheet

IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective
Date.

T-Square Design, Inc.                          InteGraphics Systems, Inc.
By:                                            By:

/s/ Tony Chu                                   /s/ Kenny Liu
Tony Chu, President & CTO                      Kenny Liu, President
7/30/1997
<PAGE>

CONFIDENTIAL INTERNAL USE ONLY                                        T/2/DESIGN
--------------------------------------------------------------------------------

1 INTRODUCTION:

FEATURES:

        *  *** v2.0 interface
        *  *** Variable Sample Rate support
        *  Up to ***Hz Double Sample Rate support
        *  32-*** synthesis
        *  *** positioning sound acceleration
        *  Legacy *** compatible
        *  Virtual *** emulation
        *  Virtual *** interpretation
        *  *** interface
        *  Enhanced digital *** interface
        *  *** receiver & transmitter
        *  *** transmitter
        *  Sample Bank resides in Main Memory or Local Memory
        *  Interface with *** BIU or other Host BIU

1.1 OVERVIEW:

Powered with T-Square *** Synthesizer engine ***, Cyber5050 is a
versatile audio processor which can be integrated in costumed CE product and
also can be utilized on *** platform.

*** CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.

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