Original Document

Digital And Intel Announce Long Term Agreement To Expand Relationship; Move To Settle Litigation

Intel to purchase Digital’s Semiconductor operations; Provide foundry services for Alpha chips

Digital to develop systems based on Intel's 64-bit architecture

SANTA CLARA Calif.—MAYNARD, MA, Oct. 27, 1997 -- Digital Equipment Corporation and Intel Corporation today announced that they have agreed to establish a broad-based business relationship that will provide significant short- and long-term benefits to both companies and their customers.

The multi-year agreement includes sale of Digital's semiconductor manufacturing operations to Intel for approximately $700 million, cross-licensing of patents, supply of both Intel and Alpha microprocessors and development of future systems based on Intel's 64-bit microprocessors. No other financial details were disclosed.

Digital and Intel agreed to request a stay of all lawsuits until U.S. government approval is granted which is required to finalize the agreement.

"This agreement meets both companies’ needs," said Craig Barrett, president and chief operating officer of Intel. "We are pleased to get alignment with one of the world’s major computer companies on IA-64 microprocessors and to let the marketplace judge our work."

"This agreement brings issues between the two companies to a resolution that benefits customers in many important ways," said Digital Chairman Robert B. Palmer. "It ensures long-term availability of Digital's Alpha-based offerings for Open VMS, Digital UNIX and Windows NT customers. In addition, Digital will develop Digital UNIX and Windows NT offerings on the IA-64 architecture."

Key components of the agreement pending government approval:

"Digital’s mission is to deliver with our partners Internet business solutions based on high-performance platforms and services," Palmer said. "This agreement strengthens our ability to offer products that help make our customers more competitive and confirms our dual Alpha and Intel platform strategy."

Digital Equipment Corporation, recognized for product and service excellence, is a leading supplier of high-performance, Web-based computing solutions which help enterprises compete in the global marketplace. Digital gives its customers a winning Internet advantage through a comprehensive portfolio of Internet solutions based on award-winning systems, advanced networking infrastructure, innovative software, and industry applications -- including those from its business partners. The expertise and experience of Digital employees help customers plan, design, implement, manage and support Internet solutions in countries throughout the world. For the latest company information, visit Digital on the World Wide Web at http://www.digital.com.

Intel, the world's largest chip maker, is also a leading manufacturer of personal computer, networking and communications products. Additional information is available at www.intel.com/pressroom.

© 1997 Intel Corporation