Document:

Exhibit 10.1
                                                                    ============

                                           May 1, 2006

Mr. William D. Shovers
3921 Indian Road
Toledo, Ohio 43606

Dear Mr. Shovers:

     This  letter  agreement  (the  "Agreement")  sets forth  certain  terms and
conditions relative to your resigning as Senior Vice President Global Operations
of Standard Microsystems Corporation,  including its subsidiaries and affiliated
corporations, ("SMSC" or the "Company").

     Effective May 1, 2006 (the "Resignation Date"), you hereby resign as Senior
Vice President  Global  Operations of the Company and from all other  positions,
titles,  duties,  authorities  and  responsibilities  with,  arising  out  of or
relating to your employment with the Company, including any directorships or any
officer or  fiduciary  positions in which you were serving at the request of, or
appointment  by, the  Company.  You and the  Company  have also agreed that your
Employment  Agreement  with the Company  dated  April 18, 2005 (the  "Employment
Agreement")  shall be null and void and all  obligations of the parties  thereto
shall  terminate  as of  the  Resignation  Date,  except  for  those  continuing
obligations  you  have to the  Company  under  Sections  7-10  and  12(a) of the
Employment Agreement which are made a part of this Agreement as though set forth
herein.  Furthermore,  you acknowledge  that you are not entitled to receive any
payments  from the  Company  under the  Employment  Agreement  or  otherwise  in
connection with your  resignation,  and the Company  acknowledges that it is not
entitled  to  receive  any  payments  from you  under the  Employment  Agreement
(including the repayment of any appointment  bonus otherwise  provided for under
Section 6 of the Employment Agreement).

     In exchange  for the Company  providing  you with the  benefits  under this
Agreement and the  Consulting  Agreement of this same date, you hereby waive all
claims  against  the  Company,  its  subsidiaries  and  affiliates,   and  their
respective current and former directors, officers, employees, agents and assigns
and  unconditionally  and  irrevocably  release and discharge  each of them from
liability  for any claims or damages  that you have or may have  against  any of
them up to the moment this  Agreement  becomes  fully  executed,  regardless  of
whether  those  claims are known or unknown  including,  but not limited to, any
claims  for  wages,  severance,  bonuses or  benefits  (except  as  specifically
provided for herein), or any other claims whatsoever arising during or, in whole
or in part, out of your employment  relationship with the Company, or violations
of any  federal,  state or  local  fair  employment  statute,  executive  order,
ordinance,  law or regulation,  including Title VII of the Civil Rights Act, the
Rehabilitation  Act of  1973,  the  Americans  With  Disabilities  Act,  the Age
Discrimination  in  Employment  Act,  as amended by the Older  Workers'  Benefit
Protection  Act, the New York State Human  Rights Law, or any other  potentially
applicable  employment  or labor  law,  or any other  rule of law or common  law
including,  but not  limited  to those  concerning  possible  torts,  express or
implied  contract,  the implied covenant of good faith and fair dealing,  public
policy, or other obligations.  You also agree not to initiate any administrative
or legal  action  against the Company to assert such  claims.  Moreover,  to the
extent any such action is brought by you or on your  behalf by any third  party,
you  agree to waive all  claims  to  monetary  relief  or  damages  of any kind,
including  attorneys'  fees  and  costs.  You  understand  that the fact of this
agreement  and/or  the  agreement  to pay or the  payment  of the  consideration
described  herein does not  constitute  an  admission by the Company that it has
violated any such law or legal obligation.  The foregoing release does not apply
to  any  rights  of  indemnification  or to  directors  and  officers  liability
insurance coverage you may have. Notwithstanding any provision of this Agreement
to the  contrary,  this release is not intended to interfere  with your right to
file a charge with the Equal Employment  Opportunity  Commission (the "EEOC") in
connection  with any claim you believe  you may have  against the Company or its
affiliates.  However, by executing this Agreement, you hereby waive the right to
recover  in any  proceeding  you may bring  before  the EEOC or any state  human
rights  commission or in any  proceeding  brought by the EEOC or any state human
rights commission on your behalf.  In addition,  this release is not intended to
interfere with your right to challenge that your waiver of any and all potential
claims under the federal Age  Discrimination  in Employment Act pursuant to this
Agreement  is a knowing and  voluntary  waiver,  notwithstanding  your  specific
representation  that  you have  entered  into  this  Agreement  (including  this
release)  knowingly and  voluntarily.  You  acknowledge  that you may take up to
twenty-one  (21)  days to  consider  the  terms  of  this  Agreement.  You  also
acknowledge that you were advised by SMSC to discuss the terms of this Agreement
with your attorneys  prior to signing this  Agreement.  You further  acknowledge
that you are entering into this Agreement,  freely,  knowingly, and voluntarily,
with  a  full   understanding  of  its  terms  (including  that  this  Agreement
specifically  releases  and  waives all rights and claims you may have under the
Federal Age Discrimination in Employment Act prior to the date on which you sign
this  Agreement)  and that you will have seven (7) days to revoke this Agreement
after  executing the same by notifying the  undersigned  in writing  during this
seven-day  period.   Except  as  expressly  set  forth  herein,  this  Agreement
constitutes  the entire  agreement  between  you and the Company  regarding  the
subject matter hereof. This Agreement may not be changed or altered, except by a
writing  signed by you and the  Company.  This  Agreement is entered into in the
State  of New York and the  laws of the  State  of New  York  will  apply to any
dispute  concerning it, without regard to its conflicts of law  provisions.  Any
litigation  or dispute  relating  to or arising out of this  Agreement  shall be
litigated  exclusively  in the state or federal  courts in Suffolk County in the
State of New York and any appellate courts therefrom, and you hereby irrevocably
accept and waive any  objections to the personal  jurisdiction  and venue of the
aforesaid  courts,  including any right to make a motion to transfer venue or to
dismiss on forum non conveniens  grounds. If any clause of this Agreement should
ever be determined to be  unenforceable,  it is agreed that this will not affect
the enforceability of any other clause or the remainder of this Agreement.

                                           Very truly yours,

                                           /s/ STEVEN J. BILODEAU
                                           ------------------------------
                                           Steven J. Bilodeau
                                           President and
                                           Chief Executive Officer

Accepted and agreed:

/s/ WILLIAM D. SHOVERS
----------------------
William D. ShoversExhibit 10.2
                                                                    ============

                        STANDARD MICROSYSTEMS CORPORATION

                              CONSULTANT AGREEMENT

THIS Agreement is made as of the 1st day of May, 2006  (hereinafter  referred to
as the "Effective Date"), by and between Standard  Microsystems  Corporation,  a
Delaware  corporation  with its principal place of business  located at 80 Arkay
Drive,  Hauppauge,  New York 11788  (hereinafter  referred  to as  "SMSC"),  and
William Shovers,  an individual residing at 3921 Indian Road, Toledo, Ohio 43606
(hereinafter referred to as "Consultant").

                               W I T N E S S E T H

WHEREAS, Consultant desires to provide services to SMSC and SMSC desires to have
certain services provided;

NOW, THEREFORE,  SMSC and Consultant  (hereinafter referred to as the "Parties")
do hereby mutually agree as follows:

1.   SERVICES; TERM OF THIS AGREEMENT:

A.  Consultant  agrees to provide to SMSC the  services  described in Exhibit A,
which is attached hereto and made a part hereof,  as such services may from time
to time be requested by SMSC.  Consultant  shall  provide only such services if,
as, and when  requested  in writing by SMSC.  The term of this  Agreement  shall
commence  on the  Effective  Date  and  shall  end on July  31,  2006.  However,
notwithstanding  the term of this  Agreement,  SMSC may terminate this Agreement
and  Consultant's  services  immediately at any time for any material  breach by
Consultant of any provision of this Agreement.  SMSC shall in any event have the
right to terminate this Agreement and Consultant's services at any time upon ten
(10) days notice and without penalty or liability.  In addition,  SMSC may renew
this Agreement on a month to month basis at any time upon ten (10) days notice.

B. Termination of this Agreement shall  automatically  occur upon the occurrence
of either of the following events:

     (i) Disability of Consultant In the event the Consultant  becomes  disabled
     and is unable to satisfy the terms of this  Agreement,  the Agreement shall
     be terminated and no other payments shall be due and payable hereunder. For
     purposes of this Agreement, "disability" shall mean any inability by reason
     of mental or physical  health,  which  cannot be  accommodated  as required
     under the Americans with Disability Act, to furnish services of an advisory
     or consulting  nature if such  inability  continues for a period of two (2)
     months.  The  determination  of any disability  hereunder shall be made, in
     writing, by a duly licensed physician selected by SMSC.

     (ii)  Death of  Consultant  In the event the  Consultant  dies prior to the
     termination  of this  Agreement,  SMSC's  obligation to make payments under
     this Agreement  shall  terminate as of the last day of the month  following
     the month during which any death occurs.

2.   COMPENSATION:

A.  After  receiving  requested  services  of  Consultant,  SMSC  agrees  to pay
Consultant at the rate  specified in Exhibit A. Payment shall be made by SMSC on
the 15th of the  month  immediately  following  the  month  in which  Consultant
performs services so long as Consultant  submits monthly invoices or time sheets
within 5 days on the end of the  month in which  Consultant  performs  services.
Invoices  shall be  considered  to have been  submitted  when received by SMSC's
Accounts Payable Department at the following  address,  or such other address of
which SMSC notifies Consultant:

                        Standard Microsystems Corporation
                        Accounts Payable Department
                        80 Arkay Drive
                        Hauppauge, New York 11788-8847

                        Contact: David Smith, Chief Financial Officer

B. In  addition,  SMSC may agree to  reimburse  Consultant  for travel and other
reasonable  and  necessary   expenses   incurred  in  the  connection  with  the
performance  of services  under this  Agreement,  including  travel deemed to be
beneficial to SMSC,  telephone  expenses,  postage,  and related charges.  To be
reimbursable,  all such expenses must be approved in writing in advance by SMSC,
and  original   receipts   must  be  provided   when   submitting  a  claim  for
reimbursement.  SMSC shall not, however,  reimburse Consultant for any costs for
stationery or other general business expenses incurred in Consultant's business.
All travel arrangements (i.e., airline, car rental, hotels) must be made through
SMSC  or the  travel  expenses  will  not be  reimbursed.  SMSC  shall  not  pay
Consultant  for time  spent in any other  travel  unless  SMSC  first  agrees in
writing,  on a  case-by-case  basis,  to do so, and then only to the extent that
Consultant actually performs services requested under this Agreement during such
travel.  To the extent that  Consultant or any of its  personnel are  performing
services on behalf of SMSC, SMSC may,  within its  discretion,  but shall not be
obligated  to,  provide  Consultant  or  such  personnel  with a desk  or  other
facilities at its premises, or with secretarial services,  but they shall not be
obligated to use such facilities or such services.

C. All records necessary to support compensable  payments or expenses under this
Agreement  shall be  maintained  by  Consultant  on a current basis and shall be
retained for one (1) year after completion of services.  Upon reasonable notice,
such records shall be made available for review and verification by SMSC.

D.  Consultant  agrees to provide SMSC with written or oral progress  reports at
such times as SMSC shall reasonably request. Consultant shall not be compensated
for the time required for preparing  such  reports.  In order to coordinate  the
activities  of  Consultant  with  respect to services  being  performed by other
consultants  and SMSC  employees,  SMSC shall designate a coordinator to monitor
the performance of Consultant's services.

3.   INDEPENDENT CONTRACTOR; WAIVER OF BENEFITS:

A. The relationship between Consultant and SMSC shall be, and shall at all times
remain,  that of  independent  contractor and not that of employer and employee,
master and  servant,  or  principal  and agent,  partners,  or joint  venturers.
Consultant  shall have no  authority  to act for SMSC as SMSC's agent or to make
any  commitments  or accept any payments or money on behalf of SMSC.  Consultant
agrees to do all things legally required to establish and maintain  Consultant's
status as an independent contractor.

B. SMSC shall  neither  have nor  exercise  any  control or  direction  over the
specific methods by which the Consultant shall perform services  hereunder;  the
sole  interest and  responsibility  of SMSC shall be to assure that the services
covered  by  this  Agreement  are  rendered  in  a  competent,   efficient,  and
satisfactory manner. Consultant shall not have any claim under this Agreement or
otherwise  against SMSC for Workers'  Compensation,  unemployment  compensation,
vacation  pay,  sick  leave,  retirement  benefits,  social  security  benefits,
disability  insurance benefits,  unemployment  insurance benefits,  or any other
employee  benefits,  all of  which  shall  be  the  sole  responsibility  of the
Consultant.  SMSC will not withhold on behalf of Consultant  any sums for income
taxes,  unemployment  insurance,  social  security,  or  any  other  withholding
pursuant  to any law or  requirement  of any  government  agency,  and all  such
withholdings,  if  any  are  required,  shall  be  the  sole  responsibility  of
Consultant.  Consultant  shall defend,  indemnify and hold  harmless  SMSC,  its
subsidiaries,   affiliates,   and  their  respective  shareholders,   directors,
officers, employees, agents and other representatives,  from and against any and
all claims, demands,  liabilities,  damages,  actions, losses, costs, penalties,
and expenses (including without limitation  reasonable attorneys' fees) that may
arise  with  respect  to any of  the  foregoing  benefits  or  withholdings,  if
Consultant is determined by the Internal Revenue Service,  or is otherwise found
or determined, not to be an independent contractor.

C. Section 2.20 of the Standard  Microsystems  Corporation Incentive Savings and
Retirement  Plan (the  "Section  401(k)  Plan")  defines the term  "Employee" to
include "leased employees." However,  Section 3.2(f) of the Section 401(k) Plan,
which  addresses   eligibility  for  benefits,   specifically   excludes  leased
employees,  such as independent  contractors,  from participating in the Section
401(k) Plan. Thus,  Consultant,  who may be determined to be a "leased employee"
under  Section  414(n)  of the  Internal  Revenue  Code  (the  "Code")  may  not
participate in the Section 401(k) Plan. Nevertheless,  in the event that the IRS
ever determines that Consultant is not a "leased employee",  but is a common-law
employee of SMSC, Consultant  affirmatively elects to waive participation in the
Section  401(k) Plan in accordance  with Section 3.5 of the Section 401(k) Plan,
and  understands  that  Consultant  is not  entitled to any  company  retirement
benefits under the Section 401(k) Plan.

D. To the extent that Consultant would otherwise  qualify as an "Employee" under
the  provisions  of the Section  401(k)  Plan or any  medical,  dental,  vision,
short-term disability, long-term disability, or other welfare plan maintained by
SMSC, Consultant affirmatively elects to waive participation in such plans.

E. As an independent contractor,  Consultant is free at all times to arrange the
time and  manner of  performance  of the  services  and may work with or for any
other individuals and entities;  provided,  however,  that all obligations under
this  Agreement are completed in a timely manner,  and further  provided that no
conflicts  of interest or breach of  obligations  with  respect to  confidential
information shall occur, as otherwise provided in this Agreement.

4.   COMPLIANCE WITH RULES AND LAWS:

A. Consultant agrees to abide by all SMSC rules and regulations  relating to the
services  provided by Consultant;  Consultant's  use or possession of, or access
to,  any  Confidential  Information,  and  any  documents,   software  programs,
drawings,  designs,  or other  property  which may be provided by SMSC;  and the
presence of Consultant on SMSC premises.  Consultant shall avoid any conflict of
interest with SMSC.

B. Consultant shall comply, and do all things necessary for SMSC to comply, with
all governmental  and  quasi-governmental  laws,  statutes,  ordinances,  rules,
regulations and orders  applicable to the services  provided by Consultant under
this Agreement, including, but not limited to, workers' compensation, safety and
health,  wage and hour,  discrimination  and labor law. In addition,  Consultant
specifically  agrees that it has complied  with and will continue to comply with
the  Immigration  Reform and Control Act of 1987.  Consultant  shall in no event
export or provide any technical data,  software or other information coming into
Consultant's  possession  pursuant to this  Agreement  or created by  Consultant
pursuant to this Agreement,  or any products derived therefrom,  to any country,
person or entity  (including  without  limitation to anyone on the U.S. Treasury
Department's  list of Specially  Designated  Nationals  or on the U.S.  Commerce
Department's  Table of Denial  Orders) in violation of any United  States law or
regulation, including but not limited to the United States Export Administration
Regulations, or permit their use for any purpose prohibited by United States law
or regulation (including, without limitation, nuclear proliferation and chemical
and biological warfare).

C.  Consultant  shall not,  without SMSC's prior written  instruction,  transmit
outside of the United  States of America any technical  data,  software or other
information  coming into Consultant's  possession  pursuant to this Agreement or
created by Consultant pursuant to this Agreement.

D. Consultant shall not discriminate  against any person with respect to hiring,
firing or other  terms and  conditions  of  employment  because of race,  color,
religion,  sex,  national origin,  physical or mental  handicap,  Vietnam Era or
disabled veteran status.

5.   ASSIGNMENT OF INVENTIONS:

A.  Subject to Section 5 B,  Consultant  hereby  assigns and agrees to assign to
SMSC  all  right,  title  and  interest  in  and to  any  inventions,  formulas,
techniques, processes, ideas, algorithms, discoveries, designs, developments and
improvements which Consultant may, alone or jointly with others, make, reduce to
practice,  conceive,  invent,  discover,  design or otherwise acquire during the
term of and arising out of services  performed under this Agreement  relating to
the actual or anticipated business,  products,  research or development of SMSC,
regardless of whether patentable (collectively,  "Inventions"),  and any and all
patents and applications therefor with respect to Inventions.

B.  Section 5 A shall not apply to,  and  Consultant  shall not be  required  to
assign any of  Consultant's  rights in an invention  that  Consultant  developed
entirely on  Consultant's  own time without  using SMSC's  equipment,  supplies,
facilities,  computer  programs,  or trade  secret(s)  and/or other  proprietary
and/or Confidential  information (as defined below), except for those inventions
that either:

     (i) relate directly or indirectly at the time of conception or reduction to
     practice  of  the  invention,  to  SMSC's  business,  or to the  actual  or
     contemplated products, research or development of SMSC, or

     (ii) result from any work performed by Consultant for SMSC.

6.   TRADE SECRETS, CONFIDENTIAL AND/OR PROPRIETARY INFORMATION:

A. Consultant shall regard and preserve as  confidential:  (i) all trade secrets
and/or other proprietary and/or confidential  information belonging to SMSC; and
(ii) all trade secrets and/or other proprietary and/or confidential  information
belonging  to a third party which have been  confidentially  disclosed  to SMSC,
which trade secrets and/or other  proprietary  and/or  confidential  information
described in (i) and (ii) above (collectively,  "Confidential Information") have
been or may be developed or obtained by or disclosed to  Consultant by reason of
Consultant's  relationship  with SMSC.  Consultant  shall not,  without  written
authority from SMSC to do so, use for Consultant's  own benefit or purposes,  or
the benefit or purpose of any person or entity other than SMSC,  nor disclose to
others, either during the term of this Agreement or thereafter, any Confidential
Information.  This provision shall not apply to Consultant's  general  expertise
and know-how that  Consultant  learned prior to his employment with SMSC, nor to
Confidential  Information which has been voluntarily  disclosed to the public by
SMSC, or which has entered the public domain through lawful means and other than
through  breach of this  Agreement  or any  violation  of a duty by  Consultant.
Confidential  Information  shall  include,  but not be limited to, all nonpublic
information relating to SMSC's (i) business, research, development and marketing
plans,  strategies  and  forecasts;   (ii)  business;  (iii)  products  (whether
existing, in development,  or being contemplated);  (iv) customers'  identities,
usages,  and requirements;  (v) reports;  (vi) formulas;  (vii)  specifications;
(viii)  designs,  software and other  technology;  (ix) research and development
programs;  (x)  employees  and their  skills;  and (xi) terms of  contracts.  No
license under any patent,  trademark,  copyright,  mask work protection right or
any other intellectual property right, is either granted or implied by providing
any Confidential Information to Consultant.

B. Consultant agrees that no confidential and/or proprietary  information of any
other person or entity will be utilized by Consultant in the performance of this
Agreement and that the  information  supplied or utilized by Consultant will not
be under any restriction as to its use,  without fee or royalty to Consultant or
any third party, by SMSC or SMSC's, affiliates, customers or licensees.

C. This Section 6 and all of  Consultant's  obligations  hereunder shall survive
any  termination  or  expiration of this  Agreement and shall  continue to apply
thereafter.  Consultant's  obligations  with respect to any  particular  item of
Confidential  Information  shall  expire,  if  ever,  only at such  time as such
Confidential  Information has been voluntarily  disclosed to the public by SMSC,
if ever,  or has entered the public domain  through  lawful means and other than
through breach of this  Agreement or any violation of a duty by  Consultant,  if
ever.

7.   WORKS OF AUTHORSHIP:

Consultant  agrees that any original  works of  authorship,  including,  without
limitation,  all  documents,  blueprints,  drawings,  mask  works  and  computer
programs (including,  without limitation,  all software,  firmware, object code,
source code, documentation, specifications, revisions, supplements, modules, and
upgrades),  conceived,  created,  performed  or produced  during the term of and
arising out of the performance of services under this  Agreement,  regardless of
whether  copyrightable,  and any and all foreign and  domestic,  registered  and
unregistered, copyrights and mask work rights and applications for registrations
therefor related to any such work of authorship,  in each case,  relating to the
actual or  anticipated  business,  products,  research  or  development  of SMSC
(collectively, "Works of Authorship") shall be the exclusive property of SMSC in
and with  respect  to any and all media and  technologies  whether  now known or
hereafter devised.  Consultant warrants that such Works of Authorship have been,
are, and shall be designed,  developed,  and created  solely by Consultant or by
employees  of  Consultant  in the  course  and  scope of their  employment  with
Consultant   subject  to  the  supervision  of  Consultant.   Consultant  hereby
irrevocably agrees to assign and hereby  irrevocably  assigns to SMSC all right,
title, and interest in and to such Works of Authorship,  effective as to each of
such Works of  Authorship as of the time such  respective  Work of Authorship is
first fixed in a tangible  medium.  Consultant  waives any and all moral  rights
which  Consultant  has or may acquire with respect to such Works of  Authorship,
and agrees not to take any steps to acquire any such rights.

8.   DISCLOSURE; FURTHER ASSISTANCE; LICENSE:

A. Consultant shall promptly and fully disclose any and all Inventions and Works
of Authorship to Consultant's coordinator at SMSC or such other official as SMSC
may  designate  for such  purpose.  Consultant  shall,  during  the term of this
Agreement and at any time thereafter,  upon the request of and at the expense of
SMSC, but at no additional  compensation to Consultant:  do all acts and things,
including, but not limited to, making and executing documents,  applications and
instruments and giving  information and testimony,  in each case, deemed by SMSC
from time to time, in its sole discretion, to be necessary or appropriate (i) to
vest, secure,  defend, protect or evidence the right, title and interest of SMSC
in  and to  any  and  all  Inventions,  Works  of  Authorship  and  Confidential
Information  owned by SMSC or required by this Agreement to be assigned to SMSC;
and (ii) to obtain for SMSC,  in relation to all such,  letters  patent,  design
registrations,  copyright  registrations and/or mask work registrations,  in the
United States and any foreign  countries,  and/or any reissues,  renewals and/or
extensions thereof.

B. To the extent that Consultant has or obtains any right,  title or interest in
or to any Works of  Authorship  or any  Inventions  which are not the  exclusive
property of or required to be assigned to SMSC  pursuant to this  Agreement  but
which are required for the unrestricted use of the results of the services to be
provided under this Agreement,  Consultant  hereby grants and agrees to grant to
SMSC,  and its  affiliates,  direct and  indirect  customers  and  licensees,  a
nonexclusive,  paid-up, royalty-free,  irrevocable, worldwide, perpetual license
to make, have made, use, sell, offer to sell,  import,  repair,  copy,  perform,
display,  distribute,  and  create  derivative  works  from  all  such  Works of
Authorship  and  Inventions  insofar  as  is  reasonably   necessary  for  their
unrestricted use of the results of such services.

9.   RETURN OF DOCUMENTATION:

All  media  on  which  any  Inventions,  Works  of  Authorship  or  Confidential
Information  may  be  recorded  or  located,   including,   without  limitation,
documents,  samples, models,  blueprints,  photocopies,  photographs,  drawings,
descriptions,  reproductions,  cards,  tapes, discs and other storage facilities
(collectively,   "Documentation")   made  by   Consultant   or  that  come  into
Consultant's  possession by reason of Consultant's  relationship  hereunder with
SMSC, are the property of SMSC and shall be delivered to SMSC by Consultant upon
termination of this Agreement. Consultant will not deliver, reproduce, or in any
way allow  any  Documentation  to be  delivered  to or used by any  third  party
without the written consent of SMSC in each case.

10.  PREVIOUS OBLIGATIONS:

Consultant  represents  and warrants to SMSC that  Consultant  has no continuing
obligation   with  respect  to  assignment  of   inventions,   developments   or
improvements to any previous  employer(s) or any other persons or entities,  nor
does Consultant claim any existing title in any previous unpatented  inventions,
developments  or  improvements  within the scope of this  Agreement or which are
related  to any of the  items  or  services  referred  to in  Exhibit  A of this
Agreement,  except as may be set forth on an Exhibit hereto  acknowledged on the
face thereof as an Exhibit hereto by an authorized representative of SMSC.

11.  CONFLICTS OF INTEREST:

Consultant represents that the provision of services  contemplated  hereunder to
SMSC shall not  constitute a conflict of interest with regard to any other party
and agrees to use best  efforts  to avoid  consulting  relationships  with other
parties  during the term of this  Agreement  which  could  create,  or appear to
create, a conflict of interest with SMSC or any of its affiliates.

12.  INFRINGEMENT; OPEN SOURCE CODE:

A. Consultant warrants and represents that it is aware of no patent,  trademark,
copyright, trade secret, or other intellectual property right which the services
to be provided  under this  Agreement  or any items  provided by  Consultant  in
connection with the services would infringe or violate;  and that it is aware of
no claims of such infringement or violation.  Consultant agrees to indemnify and
hold  harmless  SMSC,  its  subsidiaries,   affiliates,   and  their  respective
shareholders,  directors, officers, employees, agents and other representatives,
from and against any and all claims,  demands,  liabilities,  damages,  actions,
losses,  costs, and expenses (including without limitation reasonable attorneys'
fees)  arising out of any claim that any of the  services  or items  provided by
Consultant  to SMSC in  connection  with the  services,  infringes or violates a
patent,  trademark,  copyright,  trade secret,  or other  intellectual  property
right.  Notwithstanding  the  foregoing,  Consultant  shall not be  required  to
indemnify or hold SMSC harmless from or against any claims or actions based only
on written specifications and instructions provided to Consultant by SMSC.

B.  Consultant  warrants,  represents,  and agrees  that no  software  programs,
firmware,  or code of any kind provided by Consultant to SMSC in connection with
the services ("Software  Deliverables") consist of, use, contain, are derivative
works  of,  or when  used  or  executed  as  Consultant  or any of  Consultant's
personnel  contemplate  (by  virtue of their  making  use of  static or  dynamic
linking or otherwise) will or may result in the creation of any derivative works
of, any Open Source Code as defined  below.  Consultant  agrees to indemnify and
hold  harmless  SMSC,  its  subsidiaries,   affiliates,   and  their  respective
shareholders,  directors, officers, employees, agents and other representatives,
from and against any and all claims,  demands,  liabilities,  damages,  actions,
losses,  costs, and expenses (including without limitation reasonable attorneys'
fees)  arising  out of the  falsity  or  breach  of any of the  representations,
warranties,  and  agreements  in this Section 12 B. "Open Source Code" means any
software  program or code which,  by notice,  statement,  legend,  read-me file,
license agreement, or otherwise, is or is purported to be subject to a condition
or agreement that the program's or code's possession,  use, execution,  copying,
distribution, or modification by a person or entity requires that:

     (i) any source  code for the  program or code,  or any source  code for any
     associated program or code, be disclosed, made available, or distributed by
     such person or entity,

     (ii) the program or code,  or any  associated  program or code, be licensed
     for the purpose of making modifications or derivative works, or

     (iii) any patents or other  intellectual  property rights of such person or
     entity be licensed or not be asserted or enforced.

Open Source Code includes,  by way of example and not  limitation,  any software
programs  or code  licensed,  distributed,  or made  available  under any of the
following licenses or distribution schemes:

     GNU General Public License
     GNU Lesser GPL (GNU Library GPL) (LGPL)

13.  INDEMNIFICATION; WAIVER OF RIGHTS:

A.  Consultant  agrees to indemnify and hold harmless  SMSC,  its  subsidiaries,
affiliates, and their respective shareholders,  directors,  officers, employees,
agents and other representatives,  from and against any and all claims, demands,
liabilities,  damages,  actions,  losses, costs, and expenses (including without
limitation  reasonable attorneys' fees) arising out of bodily injury or property
damage that may arise from Consultant's services or any Deliverables. Consultant
waives all rights against SMSC for damages covered by Consultant's insurance. In
the event that SMSC shall authorize Consultant to use one or more subcontractors
under this  Agreement,  Consultant  shall require  similar waivers from all such
subcontractors.

B.  Consultant  agrees to indemnify and hold harmless  SMSC,  its  subsidiaries,
affiliates, and their respective shareholders,  directors,  officers, employees,
agents and other representatives,  from and against any and all claims, demands,
liabilities, damages, penalties, actions, losses, costs, and expenses (including
without limitation  reasonable attorneys' fees) arising out of any breach of any
warranty or  representation  of Consultant  under this Agreement,  or out of any
failure  of  Consultant  to  comply  with  any of  its  obligations  under  this
Agreement,  including  without  limitation those set forth in Sections 3 A, 3 B,
and 4 B.

14.  GOVERNING LAW; JURISDICTION:

This Agreement is made in Suffolk County, New York, and shall be governed by the
laws of the State of New York as applied with respect to contracts  entered into
in New York by New York residents to be performed  entirely  within the State of
New York  excluding any law or principle  which would apply the law of any other
jurisdiction. The Parties agree that all disputes arising out of this Agreement,
or their  commercial or economic  relationship  arising from or  contemplated by
this  Agreement,  shall be heard in the courts  sitting in Suffolk  County,  New
York,  and each  submits to the  jurisdiction  of the state and  federal  courts
sitting in Suffolk  County,  New York for purposes of any such action and waives
any right to assert  that venue is improper in any of such courts or that any of
such courts is an inconvenient forum.

15.  NOTICE:

Any notice to be given under this  Agreement  must be in writing and sent to the
intended party's address indicated below by using a reputable overnight delivery
service providing a delivery receipt,  or by U.S. certified mail, return receipt
requested;  or  sent by  telecopy  to the  intended  party's  telecopier  number
indicated  below.  Either party may change its notice address and/or  telecopier
number by notice  pursuant to the  provisions of this Section.  Notices shall be
effective upon receipt.  Notices shall be presumed received: (a) if sent using a
reputable  overnight delivery service providing a delivery receipt,  on the date
of delivery,  if a business day, or if not a business day, on the first business
day following  delivery;  (b) if mailed by U.S.  certified mail,  return receipt
requested,  five  days  after  such  mailing;  or (c) if sent by  telecopy  on a
business day before 4:00 PM local time of addressee,  on transmission  confirmed
electronically;  or if sent by  telecopy  at any other time or day, on the first
business day after transmission  confirmed  electronically.  Notwithstanding the
foregoing,  SMSC may instead  send any notice to be given  under this  Agreement
intended for  Consultant by email to  Consultant's  email address  below,  which
emailed  notices  shall be deemed to be  received  at the time  transmission  is
initiated by the individual sending the email,  except that, if the time of such
initiation  of  transmission  is other  than on a business  day  before  7:00 PM
Eastern  time,  the emailed  notice  shall be deemed to be received on the first
business day after such initiation of transmission.

To SMSC:

     SMSC
     80 Arkay Drive
     Hauppauge, New York 11788
     FAX:  631-435-0373
     Attention:  Andrew Solowey, Vice President of Human Resources

with a copy to:

     SMSC
     80 Arkay Drive
     Hauppauge, New York 11788
     FAX:  631-273-5550
     Attention: Legal Department

To Consultant:  William Shovers
                3921 Indian Road
                Toledo, Ohio 43606

16.  SUCCESSORS AND ASSIGNS:

The provisions of this Agreement shall be binding on Consultant and Consultant's
heirs,  personal  representatives,  successors  and permitted  assigns and shall
inure  to the  benefit  of  SMSC  and  its  successors,  assigns,  subsidiaries,
affiliated  corporations  and  ventures.  Consultant  may not assign,  delegate,
subcontract,  or transfer, by operation of law, merger, or otherwise, any of its
rights  or  obligations  under  this  Agreement.   Any  attempted  or  purported
assignment, delegation, subcontracting, or transfer by Consultant shall be void,
and, at SMSC's election, a material default by Consultant under this Agreement.

17.  DIRECT HIRE CLAUSE:

Consultant agrees that for a period of one (1) year after the date of completion
of services  under this  Agreement,  Consultant  will not directly or indirectly
solicit  for  employment  any  employee  of  SMSC  or  any  of  its  affiliates.
Notwithstanding the immediately preceding sentence, in the event that Consultant
nevertheless  employs any such person  prior to the  expiration  of such one (1)
year period  Consultant  shall pay to SMSC,  in  addition to any other  remedies
which SMSC may have at law or equity, an amount equal to twenty percent (20%) of
the annualized total compensation which Consultant commits to pay to such person
for the first year of such employment with Consultant.

18.  LIMITATION OF LIABILITY:

IN NO EVENT SHALL SMSC BE LIABLE FOR INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE, OR
CONSEQUENTIAL DAMAGES ARISING OUT OF THIS AGREEMENT.

19.  MISCELLANEOUS PROVISIONS:

The agreements, assignments and representations made by Consultant hereunder and
the  obligations  of  Consultant  herein  shall  survive the  expiration  and/or
termination of this Agreement, whether by Consultant or SMSC. This Agreement may
be  modified  only  by a  written  instrument  duly  executed  by an  authorized
representative  of Consultant  and SMSC,  respectively.  No term or provision of
this  Agreement  shall be deemed waived and no breach excused unless such waiver
or consent shall be in writing and signed by an authorized representative of the
Party against whom the waiver or such consent would operate. The failure of SMSC
at any time to  enforce  performance  by  Consultant  of any  provision  of this
Agreement  shall in no way affect SMSC's rights  thereafter to enforce the same,
nor shall the waiver by SMSC of any breach of any provision  hereof be deemed to
be a waiver  by SMSC of any  other  breach  of the same or any  other  provision
hereof.  The provisions of this Agreement  shall be enforceable  notwithstanding
the  existence  of any  claim or cause of  action of  Consultant  against  SMSC,
whether  predicated on this Agreement or otherwise.  If any section or provision
of this  Agreement,  or the  application  of such section or provision,  is held
invalid,  the remainder of this Agreement and the application of such section or
provision  to persons or  circumstances  other than those as to which it is held
invalid shall not be affected  thereby.  The various  headings in this Agreement
are  inserted  for  convenience  only  and  shall  not  affect  the  meaning  or
interpretation of this Agreement or any provision hereof.

20.  ENTIRE AGREEMENT:

This Agreement  supersedes all prior and/or  contemporaneous  agreements  and/or
understandings  made with respect to the same subject matter and constitutes the
entire Agreement between  Consultant and SMSC with respect to the subject matter
hereof.  No modification to this Agreement shall be enforceable,  except when in
writing and signed by the Parties hereto.

     IN  WITNESS  WHEREOF,   the  parties  have  caused  their  duly  authorized
representatives  to execute this  Agreement by signing on the date(s)  indicated
below, to be effective as of the Effective Date defined above.

STANDARD MICROSYSTEMS CORPORATION                     William D Shovers

    /s/ STEVEN J. BILODEAU                            /s/ WILLIAM D. SHOVERS
By:__________________________                         _________________________
     Steven J. Bilodeau
     President and
     Chief Executive Officer

<PAGE>
                                    EXHIBIT A
                                    =========

1.  Include  detailed   Statement  of  Work  or  overall  nature  of  work  with
instructions  to work as  specified  from  time-to-time  by an  identified  SMSC
coordinator.

To transition his management  responsibilities  as Senior Vice President  Global
Operations to other personnel

Such other projects as may be assigned by the Chief Executive Officer

2. SMSC agrees to pay Consultant at the rate of $37,500 per month,  prorated for
partial  months.  Upon the  termination of the  Agreement,  SMSC in its sole and
absolute  discretion by decision of its Compensation  Committee or a majority of
the  independent  directors  of the Board of  Directors  may award  Consultant a
one-time  cash bonus of up to One  Hundred  and  Twenty  Five  Thousand  Dollars
($125,000.00) based on his performance under this Agreement.

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