Patent Cross License Agreement - QuickLogic Corp. and Actel Corp.


PATENT CROSS LICENSE AGREEMENT

     THIS AGREEMENT is made and entered into on the 25th day of August, 1998, by
and between QuickLogic Corporation, a corporation incorporated under the laws of
California  ("QuickLogic")  and headquartered at 1277 Orleans Drive,  Sunnyvale,
California 94089, and Actel  Corporation,  a corporation  incorporated under the
laws of  California  ("Actel")  and  headquartered  at 955 East  Arques  Avenue,
Sunnyvale, California 94086.

     WHEREAS,  QuickLogic  and Actel are parties to those  certain legal actions
entitled Actel  Corporation v. QuickLogic  Corporation,  No. C-94 20050 JW (PVT)
and  Actel  Corporation  v.  QuickLogic  Corporation,  No.  C-97  21107JW  (EAI)
(collectively,  the  "Actions")  currently  pending  before  the  United  States
District Court for the Northern  District of California,  San Jose Division (the
"Court"); and

     WHEREAS,  QuickLogic  and Actel mutually  desire to settle the Actions,  as
well as certain other actual or potential disputes between them, as part of such
settlement; and

     WHEREAS,  the Parties have entered into a settlement agreement of even date
herewith   defining  with   particularity  the  terms  of  the  settlement  (the
"Settlement Agreement and Mutual Release");

     NOW,  THEREFORE,  the  Parties,  in  consideration  of the premises and the
mutual  promises of the Parties  hereinafter set forth and intending to be bound
by the terms  hereof,  hereby  agree,  effective  as of the  Effective  Date (as
defined below), as follows:

1.   DEFINITIONS

     As used in this  Agreement,  the  following  terms shall have the following
meanings:

     1.1. "Actel" shall mean Actel Corporation,  a California  corporation,  and
its successor, Actel Corporation, a Nevada corporation.

     1.2. "Actel Licensed  Patents" shall mean all Patents (a) that Actel or any
of its Affiliates now own or may hereafter during the term of this Agreement own
or (b) under  which and to the extent that Actel or any of its  Affiliates  have
acquired or may hereafter during the term of this Agreement acquire the right to
grant  licenses  without  the payment of a royalty or other  consideration  to a
third party (excluding  consideration paid to an employee in connection with the
assignment to Actel of the employee's  rights in an invention that resulted from
any work performed by the employee for Actel).

     1.3.  "Acquired  Party"  shall mean a party to this  Agreement  following a
Change in Ownership of such party.

     1.4.  "Acquiring Party" shall mean the Person(s),  if any, in Control of an
Acquired  Party  following  a Change in  Ownership  and the  Affiliates  of such
Person(s).

     1.5.  "Affiliate" shall mean a Person that directly,  or indirectly through
one or more  intermediaries,  controls,  or is controlled by, or is under common
control with, a specified Person.

     1.6.  "Antifuse"  shall mean a  two-terminal  switch  that is open prior to
programming.

     1.7. "Antifuse Programmable Logic Device" shall mean any Programmable Logic
Device in which all of the Programmable Switching Elements are Antifuses.

     1.8.  "Beneficial Owner" shall be used in this Agreement as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended.

     1.9.  "Change in  Ownership"  shall mean the  occurrence  of any one of the
following:

            1.9.1.  Any  Person  is or  shall  have  the  right  to  become  the
Beneficial  Owner,  directly or indirectly,  of Voting  Securities of such party
representing  50% or more of the  Total  Voting  Power  of such  party's  Voting
Securities.

            1.9.2.   The   shareholders   of  a  party  approving  a  merger  or
consolidation of such party with any other  corporation,  other than a merger or
consolidation  that  would  result  in  the  Voting  Securities  of  such  party
outstanding  immediately  prior  thereto  continuing  to  represent  (either  by
remaining  outstanding  or by being  converted  into  Voting  Securities  of the
surviving  corporation) 50% or more of the Total Voting Power represented by the
Voting  Securities  of such  party  or such  surviving  corporation  outstanding
immediately after such merger or consolidation.

            1.9.3.  The  shareholders of a party approving a plan of dissolution
or liquidation of such party or an agreement for the sale or disposition by such
party of all or  substantially  all of such party's assets in one or a series of
transactions.

     1.10.  "Control," including the terms  "controlling,"  "controlled by," and
"under common control with," shall mean the possession,  directly or indirectly,
of the power to direct or cause the direction of the  management and policies of
a Person,  whether through the ownership of Voting Securities,  by contract,  or
otherwise.  A  Person's  Beneficial  Ownership  of  twenty  (20%)  or  more of a
corporation's   outstanding   Voting   Securities   shall  create  a  rebuttable
presumption  that such Person has control of such  corporation.  Notwithstanding
the foregoing,  a Person shall not be deemed to have control of a corporation if
such Person  holds Voting  Securities,  in good faith and not for the purpose of
circumventing this Section, as an agent, bank, broker,  nominee,  custodian,  or
trustee for one or more Beneficial  Owners who do not individually or as a group
have control of such corporation.

     1.11.  "Effective  Date" shall mean the date on which the  Stipulations (as
defined  in the  Settlement  Agreement  and Mutual  Release)  are filed with the
Court.

     1.12.  "Embedded  SRAM  Programmable  Logic  Device" shall mean an Embedded
Programmable Logic Device in which any of the Programmable Switching Elements is
controlled by SRAM.

     1.13. "Embedded  Programmable Logic Device" shall mean a Programmable Logic
Device in which (x) the circuitry controlled by Programmable  Switching Elements
and (y) the circuitry  containing  User Memories  contain in the aggregate  less
than 80% of the total number of transistors on the die.

     1.14. "Flash" shall mean electrically erasable read only memory that can be
erased more than one bit at a time.

     1.15. "GateField" shall mean GateField Corporation, a Delaware corporation.

     1.16.  "Incumbent  Directors"  shall  mean  directors  who  either  (a) are
directors of a party to this  Agreement as of the  Effective  Date (or as of the
date of a Change of  Ownership,  in the case of an  Acquiring  Party) or (b) are
elected, or nominated for election, to the Board of Directors of such party with
the  affirmative  votes of a least a majority of the Incumbent  Directors at the
time of such election or nomination, but "Incumbent Directors" shall not include
any individual  whose election or nomination is in connection  with an actual or
threatened proxy contest relating to the election of directors of such party.

     1.17.  "Internal  Use" by a Person  shall mean (a) use by the Person or its
Affiliates without any sale, lease,  distribution,  or other transfer to a third
party  that  is not  an  Affiliate  of the  Person  or  (b)  incorporation  in a
value-added  product made by the Person or its Affiliates that is sold,  leased,
distributed,  or otherwise transferred to a third party that is not an Affiliate
of the Person.

     1.18.  "Licensee  Party"  shall  mean  either  Actel or  QuickLogic  in its
capacity as the recipient of rights under any Patent of the other party pursuant
to this Agreement.

     1.19.  "Licensor  Party"  shall  mean  either  Actel or  QuickLogic  in its
capacity  as the  grantor of rights  under any of its  Patents  pursuant to this
Agreement.

     1.20.  "Material Terms" shall refer to the provisions of Sections 3 and 6.4
of this Agreement.

     1.21.  "Matsushita" shall mean Matsushita  Electric  Industrial Co., Ltd, a
Japan corporation,  Matsushita Electronics Corporation, a Japan corporation, and
their Affiliates.

     1.22.  "Non-Acquired  Party" shall mean the party to this Agreement that is
not the Acquired Party or an Affiliate of the Acquired Party  following a Change
in Ownership.

     1.23. "Non-Antifuse  Programmable Logic Device" shall mean any Programmable
Logic Device that is not an Antifuse Programmable Logic Device.

     1.24.  Non-Assertion  Patent"  shall  mean (a) any  patent  (including  any
utility  patent,  design  patent,  patent of  importation,  patent of  addition,
certificate of addition,  certificate or model of utility) granted by the United
States or any other country, (b) any reissue,  continuation,  parent,  division,
extension, renewal, or continuation-in-part of any of the foregoing, and (c) any
counterpart anywhere in the world of any of the foregoing.

     1.25.  "Patent" shall mean (a) any patent  (including  any utility  patent,
design  patent,  patent of  importation,  patent  of  addition,  certificate  of
addition, certificate or model of utility) the application for which had a first
effective  filing date in any country on or before the Effective  Date,  (b) any
patent that may issue on any such  application,  (c) any reissue,  continuation,
parent,  division,  extension,  renewal, or  continuation-in-part  of any of the
foregoing,  and  (d)  any  counterpart  anywhere  in  the  world  of  any of the
foregoing.

     1.26.  "Person"  shall be used in this  Agreement as defined under Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended.

     1.27.  "Programmable  Logic Device" shall mean any integrated  circuit that
implements  logic the  operation  of which is  determined  after the  integrated
circuit has been manufactured.

     1.28.  "Programmable  Switching  Element" shall mean a switch controlled by
electrical  voltage or  electrical  currents that is used to configure the logic
function of a Programmable Logic Device.  Programmable  Switching Elements shall
not include data registers or User Memories or switches controlled by lasers.

     1.29.  "QuickLogic"  shall  mean  QuickLogic   Corporation,   a  California
corporation.

     1.30.  "QuickLogic  Licensed Patents" shall all Patents (a) that QuickLogic
or any of its  Affiliates  now  own or may  hereafter  during  the  term of this
Agreement own or (b) under which and to the extent that QuickLogic or any of its
Affiliates  have  acquired or may  hereafter  during the term of this  Agreement
acquire  the right to grant  licenses  without the payment of a royalty or other
consideration to a third party (excluding  consideration  paid to an employee in
connection  with the  assignment to QuickLogic  of the  employee's  rights in an
invention that resulted from any work performed by the employee for QuickLogic).

     1.31. "Security  Agreements" shall mean the security agreement of even date
herewith  pursuant to which Actel has granted a security  interest to QuickLogic
in the  proceeds  from the  sale,  assignment,  or other  transfer  of the Actel
Licensed  Patents to secure  Actel's  obligations  under  Section  6.4.4 of this
Agreement,  and the security  agreement of even date herewith  pursuant to which
QuickLogic  has granted a security  interest to Actel in the  proceeds  from the
sale, assignment, or other transfer of the QuickLogic Licensed Patents to secure
QuickLogic's obligations under Sections 3 and 6.4.5 hereof.

     1.32. "SRAM" shall mean static random access memory.

     1.33.  "SRAM  Programmable  Logic Device" shall mean a  Programmable  Logic
Device in which any of the  Programmable  Switching  Elements is  controlled  by
SRAM.

     1.34. "Termination Event" shall mean any of the following:

            1.34.1.  the  filing  by a party  of a  petition  in  Bankruptcy  or
insolvency; or

            1.34.2. any adjudication that a party is bankrupt or insolvent; or

            1.34.3.  the appointment of a receiver for all or substantially  all
of the property of a party; or

            1.34.4.  the  making  by a  party  of any  assignment  or  attempted
assignment for the benefit of creditors; or

            1.34.5.  the  institution of any  proceedings for the liquidation or
winding  up of a  party's  business  or for  the  termination  of its  corporate
charter; or

            1.34.6.  any  assignment of this Agreement or any exercise of rights
under this Agreement by any successor or assign of a party, except in accordance
with Section 8.

     1.35. "Total Voting Power" shall mean the total number of votes that may be
cast  in the  election  of  directors  at a  meeting  of the  shareholders  of a
corporation if all Voting Securities are present and voted to the fullest extent
possible at such meeting.

     1.36. "User Memory" shall mean random access memory (RAM),  SRAM, read only
memory (ROM), or  programmable  read only memory (PROM),  erasable  programmable
read only memory (EPROM),  electrically  erasable  programmable read only memory
(EEPROM),  Flash, or variations thereof,  used for storing data and control bits
during the logic  operation of a Programmable  Logic Device.  The circuitry of a
Programmable Logic Device controlled by Programmable  Switching Elements and the
circuitry of a Programmable  Logic Device  containing User Memories are mutually
exclusive.

     1.37.  "Voting  Securities"  shall  mean all  securities  of a  corporation
entitled to vote generally in the election of directors.

2.   LICENSES

     2.1. Subject to Sections 2.3 and 6.4.2 hereof,  QuickLogic hereby grants to
Actel a  nonexclusive,  royalty-free,  worldwide  license  under the  QuickLogic
Licensed Patents (a) to make, have made only for Actel,  use,  import,  offer to
sell,  sell,  lease,  distribute,  and  otherwise  transfer  Programmable  Logic
Devices,  and  (b) to  grant  sublicenses  to  make,  have  made  only  for  the
sublicensee,  use, import, offer to sell, sell, lease, distribute, and otherwise
transfer Embedded Programmable Logic Devices.

     2.2.  Subject to the  payment of the  amounts set forth in Section 3 hereof
and to Sections  2.3,  4.5,  6.4.2,  and 6.4.3  hereof,  Actel hereby  grants to
QuickLogic  a  nonexclusive,  royalty-free,  worldwide  license  under the Actel
Licensed Patents (a) to make, have made only for QuickLogic,  use, import, offer
to sell, sell, lease,  distribute,  and otherwise  transfer  Programmable  Logic
Devices,  but  excluding  all  SRAM  Programmable  Logic  Devices,  (b) to grant
sublicenses to make, have made only for the sublicensee,  use, import,  offer to
sell, sell, lease,  distribute,  and otherwise  transfer  Embedded  Programmable
Logic Devices,  but excluding all Embedded SRAM Programmable Logic Devices,  and
(c) to grant  sublicenses to make, have made (but only for a sublicensee that is
a  semiconductor  manufacturer or foundry),  and use Embedded SRAM  Programmable
Logic Devices only for the Internal Use of the sublicensee.

     2.3. The licenses  granted in Sections 2.1 and 2.2 of this Agreement  shall
not include any right in favor of a Licensee Party:

            2.3.1.  to  grant  any  sublicense  to  any  Person,  including  any
Affiliate of a Licensee  Party other than a wholly-owned  subsidiary,  except as
expressly  provided  with  respect  to  Embedded   Programmable  Logic  Devices,
provided,  however,  that any such sublicense may not be further sublicensed and
may not be assigned or otherwise  transferred except in connection with a Change
in Ownership of the sublicensee; or

            2.3.2.  to offer to sell,  sell,  lease,  distribute,  or  otherwise
transfer any product to any  semiconductor  manufacturer or foundry or Affiliate
thereof,   except   exclusively  for  the  Internal  Use  of  the  semiconductor
manufacturer  or foundry;  provided,  however,  that Actel may sell or otherwise
transfer  products to Matsushita for resale by Matsushita in accordance with the
Distribution  Agreement between  Matsushita and Actel dated as of June 29, 1995,
and any renewal thereof; or

            2.3.3. to sell, lease,  distribute,  or otherwise  transfer all or a
part of the Licensee Party's business or the assets comprising such business, or
transfer  control of a subsidiary  engaged in such business,  to the extent such
part of the Licensee Party's business or such assets or such subsidiary  include
the business of making and selling  products  covered by any license  granted to
the Licensee  Party in Sections  2.1 or 2.2 of this  Agreement,  as  applicable,
except as may be permitted by Section 8; or

            2.3.4.  to make,  have made,  import,  offer to sell,  sell,  lease,
distribute, or otherwise transfer any product that is pin interchangeable in the
final  application  of the product  with a product  then offered for sale by the
Licensor Party (excluding products having pinouts originating with a third party
that either (a) are not replicas of a pinout of QuickLogic or Actel or GateField
products  or  (b)  reflect  standards   promulgated  by  a  standards  committee
sanctioned  by the IEEE,  JEDEC,  or an equivalent  organization  other than the
United States Department of Defense).

     2.4.  Nothing  contained in this Agreement shall be construed as conferring
by  implication,  estoppel,  or otherwise upon either party any license or other
right except the licenses and rights  expressly  ranted hereunder to that party.
Notwithstanding  the foregoing,  the Licensee Party and its customers shall have
the right to program the  products  covered by any license (or  covenant  not to
sue) granted under this Agreement to the Licensee Party.

     2.5. Each party hereby  accepts the licenses and rights  granted to it by a
party under this  Agreement  subject to all of the terms and  conditions of this
Agreement.

3.   PAYMENTS

     3.1. As consideration  for the license granted to QuickLogic by Actel under
Section 2.2 of this Agreement,  QuickLogic  grants to Actel the rights set forth
in Section 2.1 of this Agreement and agrees to pay to Actel the sum of

.  
 shall be due and payable
on the Effective Date of this  Agreement,  and (subject to Sections 3.2,  6.4.4,
and 6.4.5 hereof) the balance shall be due and payable in quarterly installments
as follows:

  
         3 months after Effective Date                               

                                                                                       
         6 months after Effective Date                               


         9 months after Effective Date                               


         12 months after Effective Date                              


         15 months after Effective Date                              


         18 months after Effective Date                              


         21 months after Effective Date                              


         24 months after Effective Date                              


         27 months after Effective Date                              


         30 months after Effective Date                              


         33 months after Effective Date                              


         36 months after Effective Date                              


If any such payment is not made when due and is not cured within fifteen (15) business days after written notice to QuickLogic specifying the failure to pay, all subsequently due payments shall become immediately due and payable. 3.2. In the event QuickLogic effects an initial public offering of its Common Stock pursuant to a registration statement under the Securities Act of 1933, all subsequently due payments shall become immediately due and payable on the tenth business day following the closing of such offering. 4. NON-ASSERTION AGREEMENTS 4.1. QuickLogic agrees that QuickLogic and its Affiliates will not assert during the term of this Agreement and thereafter, directly or indirectly, any cause of action based, in whole or in part, upon the purported infringement by Actel or its suppliers or customers, mediate or immediate, during the term of this Agreement of any Non-Assertion Patent, whether granted by the United States or another country to QuickLogic or its Affiliates or any third party, as a result of the manufacture, use, importation, offer for sale, sale, lease, distribution, or other transfer of (a) products first offered for sale by Actel on or before the second anniversary of the Effective Date of this Agreement and (b) future generations of such products reflecting the evolution of such products in the ordinary course of business of QuickLogic's product lines as they exist on the second anniversary of the Effective Date of this Agreement. 4.2. QuickLogic agrees that no purchaser or transferee of any Non-Assertion Patent from QuickLogic or its Affiliate and no assignee of the right to enforce any Non-Assertion Patent from QuickLogic or its Affiliate will assert during the term of this Agreement or thereafter, directly or indirectly, any cause of action based, in whole or in part, upon the purported infringement by Actel or its suppliers or customers, mediate or immediate, during the term of this Agreement of the Non-Assertion Patent sold, transferred, or assigned as a result of the manufacture, use, importation, offer for sale, sale, lease, distribution, or other transfer of (a) products first offered for sale by Actel on or before the second anniversary of the Effective Date of this Agreement and (b) future generations of such products reflecting the evolution in the ordinary course of business of QuickLogic's product lines as they exist on the second anniversary of the Effective Date of this Agreement. 4.3. Subject to Section 4.5 hereof, Actel agrees that Actel and its Affiliates will not assert during the term of this Agreement and thereafter, directly or indirectly, any cause of action based, in whole or in part, upon the purported infringement by QuickLogic or its suppliers or customers, mediate or immediate, during the term of this Agreement of any Non-Assertion Patent, whether granted by the United States or another country to Actel or its Affiliates or any third party, as a result of the manufacture, use, importation, offer for sale, sale, lease, distribution, or other transfer of (a) products first offered for sale by QuickLogic on or before the second anniversary of the Effective Date of this Agreement and (b) future generations of such products reflecting the evolution of such products in the ordinary course of business of Actel's product lines as they exist on the second anniversary of the Effective Date of this Agreement. 4.4. Subject to Section 4.5 hereof, Actel agrees that no purchaser or transferee of any Non-Assertion Patent from Actel or its Affiliate and no assignee of the right to enforce any Non-Assertion Patent from Actel or its Affiliate will assert during the term of this Agreement or thereafter, directly or indirectly, any cause of action based, in whole or in part, upon the purported infringement by QuickLogic or its suppliers or customers, mediate or immediate, during the term of this Agreement of the Non-Assertion Patent sold, transferred, or assigned as a result of the manufacture, use, importation, offer for sale, sale, lease, distribution, or other transfer of (a) products first offered for sale by QuickLogic on or before the second anniversary of the Effective Date of this Agreement and (b) future generations of such products reflecting the evolution of such products in the ordinary course of business of Actel's product lines as they exist on the second anniversary of the Effective Date of this Agreement. 4.5. Notwithstanding anything in this Agreement to the contrary, neither Actel nor its Affiliates shall be precluded or in any way restrained by this Agreement from asserting against any Person, including QuickLogic and any Acquiring Person, any claim of infringement of any Actel Licensed Patent or Non-Assertion Patent as a result of the manufacture, use, importation, offer for sale, sale, lease, distribution, or other transfer of (a) an SRAM Programmable Logic Device prior to a Change in Ownership of QuickLogic, (b) a Non-Antifuse Programmable Logic Device following a Change in Ownership of QuickLogic, or (c)(i) flash products first offered for sale by GateField on or before the second anniversary of the Effective Date of this Agreement and future generations of such products reflecting the evolution of such products in the ordinary course of business of GateField's product lines as they exist on the second anniversary of the Effective Date of this Agreement or (ii) "knockoffs" substantially similar to such products, in each case subject to the rights of any sublicensee authorized under Sections 2.2(b) and (c) hereof. 5. REPRESENTATIONS, WARRANTIES, AND DISCLAIMERS 5.1. Each Licensor Party represents and warrants that it has all right, title, and interest in and to the Patents purported to be licensed by it to the Licensee Party and all power and authority necessary to grant the licenses to such Patents that are granted by the Licensor Party to the Licensee Party hereunder. 5.2. Each Licensor Party represents and warrants that neither it nor any of its Affiliates has the right or power to direct any third party to assert against the Licensee Party any cause of action based upon the Licensee Party's purported infringement of any patent owned or enforceable by such third party. 5.3. Nothing contained in this Agreement shall be construed as a warranty or representation that the manufacture, sale, lease, use, or other transfer of Programmable Logic Devices by either party or any component thereof will be free from infringement of patents, trademarks, copyrights, mask work rights, or other intellectual property or other rights of third parties or of the Licensor Party, except to the extent of the rights expressly licensed hereunder to the Licensee Party by the Licensor Party, or that the Licensee Party will be able to manufacture or to sell or otherwise transfer any product based upon the rights it receives hereunder from the Licensor Party. Except to the extent, and only to the extent, expressly stated herein, neither party makes any warranty as to the accuracy, sufficiency, or suitability of any information contained in any Patent licensed hereunder. Each Licensee Party assumes the risk of defects or inaccuracies in the Patent or other data or information, if any, supplied by the Licensor Party. Neither party shall be under any obligation by this Agreement to obtain any patent or, once having obtained a patent, to maintain that patent in force. 5.4. Each party acknowledges and agrees that the other party has made no statement or representation as to the size of the market for the products that may be made or sold utilizing the licenses granted or to be granted hereunder or as to the amount of revenue or profits to be received by the party obtaining such licenses. Each party acknowledges that, in entering into this Agreement, it is relying entirely on its own estimate as to the market for the products that may be made and sold utilizing the license granted and to be granted hereunder. 5.5. Each party acknowledges and agrees that a Programmable Logic Device containing SRAM is not and shall not be deemed to be an SRAM Programmable Logic Device if all of the SRAM is User Memory; and a Programmable Logic Device containing SRAM is and shall be deemed to be an SRAM Programmable Logic Device only if one or more of the Programmable Switching Elements of the Programmable Logic Device is controlled by SRAM. 6. TERM AND TERMINATION 6.1. The term of this Agreement shall commence on the Effective Date and, subject to this Section 6 and to Section 8, shall expire when the last to expire of the Patents licensed hereunder expires. 6.2. If either party shall fail to perform a Material Term of this Agreement and such failure is not cured within sixty (60) days after written notice to the defaulting party specifying the nature of the default, the complaining party shall have the right at its option: 6.2.1. to terminate all rights and licenses granted by the complaining party to the defaulting party under this Agreement by giving written notice of such termination to the defaulting party, effective on the sixtieth (60th) day after such termination notice is given if the default has not then been cured; and/or 6.2.2. to seek any other remedies available at law or in equity as a result of such failure. 6.3. Each party agrees that (a) this Agreement is personal to it; (b) if it is the subject of a Termination Event described in Section 1.34.1 or 1.34.2 hereof, this Agreement shall automatically terminate; and (c) if it is the subject of any other Termination Event, the other party shall have the right to terminate this Agreement by giving written notice of termination to such party, such termination to be effective on the tenth (10th) day after such notice of termination under this Section 6.3 is given in accordance with this Agreement. Upon termination of this Agreement under the provisions of this Section 6.3, the rights and licenses granted to the party that was the subject of the Termination Event shall terminate. The rights and licenses granted under this Agreement to the other party shall survive termination in accordance with the applicable terms hereof; provided, however, all such licenses to a party shall terminate no later than the last to expire of any Patents of the other party that are licensed hereunder. Notwithstanding anything in this Agreement to the contrary, the parties shall have the right to use, lease, sell, or otherwise dispose of Programmable Logic Devices in the process of manufacture or in finished goods inventory upon the termination of this Agreement. 6.4. In the event of a Change in Ownership, the rights and obligations of the Acquired Party shall continue in full force and effect, and the Acquired Party shall have the right to assign such rights (including the licenses and non-assertion covenants) to the Acquiring Party, all subject to the following: 6.4.1. The Acquiring Party shall agree in writing to be fully bound by all the terms and conditions of this Agreement. 6.4.2. All sublicenses granted by the Acquired Party to the Acquiring Party and its Affiliates shall be limited to Internal Use. 6.4.3. If QuickLogic is the Acquired Party, the license under Section 2.1(a) hereof shall be limited to Antifuse Programmable Logic Devices following the Change in Ownership and any sublicense granted under Section 2.1(b) hereof following the Change in Ownership shall be limited to Internal Use. 6.4.4. Subject to Section 6.4.6 hereof, if Actel is the Acquired Party, Actel shall pay to QuickLogic if the Change in Ownership occurs within one year after the Effective Date, of the Change in Ownership occurs one or more but less than two years after the Effective Date, if the Change in Ownership occurs two or more but less than three years after the Effective Date, if the Change in Ownership occurs three or more but less than four years after the Effective Date, and $0 if the Change in Ownership occurs four or more years after the Effective Date (in each case, less the balance owed by QuickLogic to Actel, if any, pursuant to Section 3 hereof). 6.4.5. Subject to Section 6.4.6 hereof, if QuickLogic is the Acquired Party, QuickLogic shall pay to Actel if the Change in Ownership occurs within one year after the Effective Date, of the Change in Ownership occurs one or more but less than two years after the Effective Date, if the Change in Ownership occurs two or more but less than three years after the Effective Date, if the Change in Ownership occurs three or more but less than four years after the Effective Date, and $0 if the Change in Ownership occurs four or more years after the Effective Date (in each case, plus the balance owed by QuickLogic to Actel, if any, pursuant to Section 3 hereof). 6.4.6. The payments described in Sections 6.4.4 and 6.4.5 hereof shall be due and payable ten (10) business days following the Change in Ownership, provided, however, that no payment shall be due on account of a Change in Ownership if all Programmable Logic Devices made by or for the Acquiring Party or its Affiliates following the Change in Ownership are exclusively for the Internal Use of the Acquiring Party and its Affiliates. 6.5. If, following a Change in Ownership or in anticipation thereof, an Acquiring Party or its Affiliate asserts during the term of this Agreement or thereafter, directly or indirectly, any cause of action based, in whole or in part, upon the purported infringement by the Non-Acquired Party or its suppliers or customers, mediate or immediate, during the term of this Agreement of any Non-Assertion Patent as a result of the manufacture, use, importation, offer for sale, sale, lease, distribution, or other transfer of (a) a Programmable Logic Device, if Actel is the Non-Acquired Party, (b) a Programmable Logic Device other than an SRAM Programmable Logic Device, if QuickLogic is the Non-Acquired Party and QuickLogic had not previously been subject to a Change in Ownership, or (c) an Antifuse Programmable Logic Device, if QuickLogic is the Non-Acquired Party and QuickLogic had previously been subject to a Change in Ownership, then the Non-Acquired Party may terminate all rights and licenses granted by it under this Agreement by giving written notice of such termination to the Acquiring Party, effective on the thirtieth (30th) day after such termination notice is given if the claim is then still being asserted against the Non-Acquired Party, provided, however, that the Non-Acquired Party shall have no right to terminate the rights and licensed granted by it under this Agreement if, prior to the assertion by the Acquiring Party or its Affiliate of a Non-Assertion Patent referred to above (but following the Change in Ownership or in anticipation thereof), the Non-Acquired Party had first asserted, directly or indirectly, a cause of action based, in whole or in part, upon the purported infringement by the Acquiring Party or its Affiliate of any patent as a result of the manufacture, use, importation, offer for sale, sale, lease, distribution, or other transfer of (i) an Antifuse Programmable Logic Device, if Actel is the Non-Acquired Party and QuickLogic had previously been subject to a Change in Ownership, (ii) a Programmable Logic Device other than an SRAM Programmable Logic Device, if Actel is the Non-Acquired Party and QuickLogic had not previously been subject to a Change in Ownership, or (iii) a Programmable Logic Device, if QuickLogic is the Non-Acquired Party. 6.6. Neither suspension nor termination shall excuse the defaulting party from any obligation incurred hereunder prior to the date of suspension or termination. 6.7. The terms and conditions of Sections 1, 3, 5, 6, 7, 8, and 9 shall survive the expiration, termination, or cancellation of this Agreement from any cause. 7. ENFORCEMENT 7.1. The formation, effect, performance, and construction of this Agreement shall be governed by the laws of the State of California of the United States of America, except those pertaining to choice of laws, as though made by two parties residing in California so as to be fully performed with the State of California. 7.2. IN NO EVENT SHALL EITHER PARTY HAVE ANY LIABILITY TO THE OTHER FOR INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT LIMITED TO LOST PROFITS, OR FOR SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES, AND EACH PARTY COVENANTS NOT TO SEEK ANY SUCH DAMAGES WITH RESPECT TO ANY CLAIM ARISING OUT OF OR RELATED TO THIS AGREEMENT. 8. ASSIGNMENT OF AGREEMENT 8.1. Except as expressly set forth in Section 6.4 above, neither this Agreement nor the rights granted and obligations undertaken pursuant to this Agreement may be assigned, sold, or otherwise transferred, in whole or in part, provided, however, that this Agreement may be assigned by either party in connection with its reincorporation under the laws of a state other than California. 8.2. For all purposes of Section 6, a reference to any license granted by either party under this Agreement shall also be deemed to be a reference to that party's covenants under Section 4 of this Agreement not to assert claims under its patents. 8.3. The parties acknowledge and agree that this Agreement is an executory contract governed by 11 U.S.C. ss.ss. 365(c)(i), (e)(ii), and (n) in the event of a bankruptcy case with regard to either party. As such, this Agreement is not subject to assumption or assignment in the event of bankruptcy without the consent of the non-debtor party. 9. MISCELLANEOUS 9.1. This Agreement, the Settlement Agreement and Mutual Release, and the Security Agreements incorporate the entire understanding of the parties with respect to the subject matter of this Agreement and merge all prior agreements and understanding between the parties, whether oral or written, with respect to this subject matter. This Agreement shall be interpreted in accordance with the law of California such as applied to a contract to be wholly performed within the state of California. 9.2. Except as may be expressly set forth herein, nothing in this Agreement shall be construed as obligating any party to manufacture or sell any particular product hereunder or as restricting the right of either party herein to engage in any development of, or to make, have made, use, lease, loan, sell, or otherwise dispose of any product, other than the products with respect to which licenses are herein granted. 9.3. All notices required or permitted to be given hereunder shall be in writing and shall be sent by facsimile, receipt to be confirmed by sender via telephone call, or by registered or certified mail, postage prepaid, addressed as follows: If to QuickLogic: QuickLogic Corporation 1277 Orleans Drive Sunnyvale, California 94089 Telecopier No.: 408-990-4040 Attention: President If to Actel: Actel Corporation 955 East Arques Avenue Sunnyvale, CA 94086 Telecopier No.: (408) 739 - 0706 Attention: President Either party may change its address by a notice given to the other party in the manner set forth above. Notices given as herein provided shall be construed to have been given (a) on the day received if sent by facsimile or (b) five (5) days after the sending thereof by registered or certified mail, unless the receiving party proves that the notice was actually received at a later date. 9.4. The failure of any party hereunder to perform any obligation otherwise due as a result of governmental action, laws, orders, regulations, directions or requests, or as a result of events, such as war, acts of public enemies, strikes or other labor disturbances, fires, floods, acts of God, or any causes of like or different kind beyond the control of the parties is excused for so long as said cause exists to the extent such failure is caused by such lain, order, regulation, direction, request, or other event. 9.5. No failure or delay on the part of either party in the exercise of any right or privilege hereunder shall operate as a waiver thereof or of the exercise of any other right or privilege hereunder nor shall any single or partial exercise of any such right or privilege preclude other or further exercise thereof or of any other right or privilege. 9.6. Any title or caption included herein is for convenience only and is not to be used in the interpretation of this Agreement. 9.7. Nothing contained herein or done pursuant to this Agreement shall constitute the parties as entering upon a joint venture or partnership or shall constitute either party hereto the agent of the other party for any purpose or in any sense whatsoever. 9.8. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together constitute one and the same Agreement. 9.9. Should any clause, sentence, or paragraph of this Agreement judicially be declared to be invalid, unenforceable, or void, such decision shall not invalidate or void the remainder of this Agreement, and the parties hereby agree that the part or parts of this Agreement so held to be invalid, unenforceable, or void shall be deemed to have been stricken, and the remainder shall have the same force and effect as if such part or parts had never been included herein. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed in their respective corporate names. ACTEL CORPORATION QUICKLOGIC CORPORATION By: /s/ John C. East By: /s/ E. Thomas Hart Name: John C. East Name: E. Thomas Hart Title: President & CEO Title: President & CEO Date: August 25, 1998 Date: August 25, 1998