Digital Equipment Corporation

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IN THE MATTER OF TAL EQUIPMENT CORPORATION CON , ETC., IN REGARD TO ALLEGED VIOLATION OF )F THE CLAYTON ACT AND SEC. 5 OF THE 'EDERAL TRADE COMMISSION ACT 8. Complaint. July 14. 1998--Decision, July 1998 This cor in conjunction with Digital's sale of certain semiconductor business el Corporation, requires, among other things, Digital to enter into oro licensing agreements with Advanced Micro Devices, Inc. , and Samsunf Co., Ltd., or other Commission-approved licensees, and to begin th: certifying International Business Machines, Inc. or other Commis :d companies to manufacture Digitalis Alpha microprocessor devices.

Participants For lission: Robert Cook, John Horsley, Joseph Krauss, and Jonalhan Baker.Wilia" rvid Meyer, Jay Creswell For Ident: Benjamin Crisman, Jr. , Skadden, Arps, Slate, C. and Michael Weiner, SkaddenMeagh, Washington, D. Arps (her Flom New York, N. COMPLAINT Pur e provisions of the Federal Trade Commission Act and by the authority vested in it by said Act, the Federal Trade, having reason to believe that an agreement between :orporation and Digital Equipment Corporation wheret ,ill acquire certain assets of Digital Equipment , 15Corpor ltes Section 7 of the Clayton Act, as amended ection 5 of the Federal Trade Commission Act, as amend, c. 45, and it appearing to the Commission that a procee pect thereof would be in the public interest, hereby Issues int, stating its charges as follows: Complaint 126 FTC. A. THE RESPONDENT is a 1. Resp Digital Equipment Corporation ("Digital") corporation, existing, and doing business under and by virtue of th fthe Commonwcalth of Massachusetts, with its principal ex )ffces located at 111 Powdermil Road, Maynard Massachusl 2. Digit nternational corporation with worldwide sales of approximat; bilion in 1997. Digital designs, develops manufactur (ets, and sells computer hardware and software systems, in personal computers, workstations, and servers. Digital als( , develops, manufactures, markets, and sells a variety of Sl ,uctor products, including certain microprocessor products tho 1erally known, marketed, and sold under the trade name AJph:

3. At al relevant herein, Digital has been, and is now, a corporatior poration" is defined in Section 4 of the Federal Trade Con 1 Act, 15 U. C. 44; and at all times relevant herein, Di! ; been, and is now, engaged in commerce as commerce 1ed in Section 4 ofthe Federal Trade Commission Act, 15 U.

1. THE PROPOSED TRANSACTION 4. Intel tion ("Intel") is a corporation organized, existing, and doing; under and by virtue of the laws of the State of Delaware offce and principal place of business located at 2200 Missi ge Boulevard, Santa Clara, California. Intel has 8 billion.annual wor les of approximately $20. 5. Intel develops, manufactures, markets, and sells a variety of s, ctor products, including a line of microprocessor products the ,rally known, marketed, and sold under the trade names Penl tium with MMX, Pentium Pro, and Pentium II (the "Penh! processors 6. Digit el are currently litigating three pending lawsuits involving 11 property and technology rights relating to microproce ,ital initiated that litigation on May 12, 1997, by filing a la\ viassachusetts alleging that Intel has willfully infringed al patents by making and selling Pentium microproce I May 27, 1997, Intel filed a related lawsuit in California hat Digital breached certain contractual duties DIGITAL EQUIPMENT CORPORA non Complaint and viol, ,I' s trade secret rights by refusing to return certain technical ation about Intel microprocessors. In August and Septembl Intel fied counterc1aims in Digital' s Massachusetts lawsuit, 1wsuit in Oregon alleging that Digital wi11ully infringed Intel patents by, among other things, making and selling A croprocessors.

7. Or r 26, 1997, Digital and Intel executed a proposed SettlemeJ ~ment, which provides for, among other things, the settlemer pending litigation between Digital and Intel, the cross lic, f Intel and Digital patents for a period of ten (10) years, th, Digital' s semiconductor business and operations to Intel, the lment of contractual relationships pursuant to which Intel will s an Alpha microprocessor foundry for Digital and supply A 2roprocessors to Digital, the retention by Digital of all inte1l, )roperty rights relating to Alpha microprocessor architec technology, and the retention by Digital of those Digital, s supporting the design and development of Alpha product le execution of the Settlement Agreement, Digital and Inte :gotiated all of the subsidiary agreements that are contemI ' and intended to implement the terms of, the Settlem, ,ement (the "Implementing Agreements 8. 1 'posed Settlement Agreement and Implementing Agreem ,vide, among other things, that Digital shall sell, and Intel she, Digital' s semiconductor business and operations inc1udin 2ilities and manufacturing assets now used by Digital to prod digital semiconductor products, including AJpha mlcropr' s. The proposed Settlement Agreement and Implem, Agreements require Intel to produce and supply exclusiv )jgital Alpha microprocessor products for a period of seven (7 rom the closing date ofthe transactions contemplated by those nents, but do not restrict Digital's rights to establish or furth ,lop any relationship or relationships with other semi con manufacturers to produce Alpha microprocessor devices mdry for Digital or otherwise. In connection with the propose' ncnt Agreement, Digital also agreed to announce that it would Intel' s forthcoming IA-64 microprocessor devices by building ter systems designed around such devices. 9. 1 'posed Settlement Agrecment and Implementing Agreem ther provide, among other things, that Intel shall hire Complaint 126 FTC. andcurrentDigital shallenfacilitatehe Digitaland encouragesemiconductorIntel' sbusiness,efforts to withhire,theall gital employees who currently support theexceptiondesign and It of Alpha microprocessor products. Among to be hired by Intel under the Settlementthe Digita Jigital employees who currently conduct orAgreemen to market and sell the Digital semiconductorsupport Di product Ii g Alpha microprocessor products, to the merchant r miconductor devices.

Settlement Agreement and Implementing 10. TnAgreemenl vide that Digital shall retain ownership of all mlcroprocIintellectua. mdture andtechnologydevices, andrightscontemplaterelatingthatto DigitalAlpha the Alpha architecture and future generationswil contiDl r products. Those Agreements also expresslyof Alpha m give Digi" . ) license Alpha intellectual property or techno log I parties, and do not prevent Digital from Ig strategic alliances with third parties foraugmentir 1 microprocessor technology.the develc 'E RELEVANT MARKETS 11. Or ,f commerce in which to analyze the likely competiti' e proposed Settlement Agreement is the manufactt of high-performance, general-purpose mlcroproc :capable of running the computer operating system sol node that is currently being developed and sold by M ation ("Microsoft") under the trade name Windows 12. A line of commerce in which to analyze the likely con of the proposed Settlement Agreement is the manuf Jf all general-purpose microprocessors. 13. A lne of commerce in which to analyze the likely con of the proposed Settlement Agreement is innovatior and development of high-performance general- cessors.

14. Tho 1phic market in which to analyze the likely competiti\ proposed Settlement Agreement is the world.

DIGITAL EQUIPMENT CORPORATION Complaint D. CONCENTRATION market power in the market for the supply of high- general-purpose microprocessors that are capable of ru windows NT operating system. Intel accounts for nearly ,fdollar sales and nearly 85 percent of unit sales of such! Jrs. Digital accounts for approximately one percent ofthe, and unit sales of such devices. Moreover, Alpha mlcn ld Intel Pentium products are today the two closest subst perhaps the only two viable devices -- available for comp nanufacturers and computer users who require a mlcrc rpable of running in native mode the Windows NT opera J has market power in the market for all gener icroprocessors. Intel accounts fornearly 90 percent of de d 80 percent of unit sales of general-purpose mlcrc )digital accounts for approximately one percent of dollar it sales of such devices. No firm other than Intel accou Jre than four percent of dollar sales of micro nd no firm other than Intel accounts for more than 10 pe ;ales of microprocessors. Intel are two of the most significant innovation compo design and development of high-performance mlcrol ven with its comparatively small share of the releva: )digital' s Alpha microprocessor represents the greate: :al challenge to Intel, and stands as the most signifi Intel' s continued market dominance. For the last several s Alpha devices have consistently demonstrated industl formance as measured by processing speed and related critcria generally recognized in the industry. Intel rccogn \Jpha microprocessor has superior performance charac :s a competitive threat to Intel's products, and establi nce benchmarks that serve as goals to which Intel aspires )ment of its own future microprocessorproducts. Indeed 1jor goal for Intel is the development of a new 64-bitl ,cessor architecture (known as IA -64) to compete withD t 64-bit Alpha architecture, and the development of new ! microprocessors (currently known by project names ccd and McKinley) to compete with Digital' Alpha _. _...

'RYCONDITIONS l8. Er Ie relevant markets would not be suffciently timely or letter or otherwise correct the anti competitive effects of 1 ,d Settlement Agreement. 19. A trant would need to develop a relevant mlcroproc luct, which development requires substantial capital exp md several years of engineering work. The entry cost requir loping a new high-performance microprocessor would like 250 million. The development of such a product would req imum of two years, and a high-performance mlcroproc, .aable to Digital's Alpha microprocessors and Intel' s Penl cts would likely require at least four years. For example ntel began development of its new IAmlcroproc, 194, the first generation IA-64 device known as cted to be commercially available before the sec, Ito the relevant markets is also deterred by the mid Ile requirements for a modern semiconductor fabl lhe cost of developing, building and equipping sucl Jroximately $1.6 billion. An entrant could not expo ing revenue microprocessor products for at least foul r starting the construction of such a facility. A new avoid significant fixed costs in buildings or equ: sting with an existing microprocessor producer to p Jring and development services, but even such fab lid require approximately six months and a com )ximately 30 staff to the manufacturing area at aco: r person per year, in addition to significant costs fori nt would also have to establish both product repu ical compatibility with a computer operating syst, ations software desired by a significant number ofc( Jyers of computer systems and microprocessor com highly reliable products, and regard product repu essential purchasing criterion. Consumers also demand com stems and microprocessor components that are capable ofru e computer operating systems and applications software pn that are desired by computer end-users. Accordingly, entrant must attract support from software DIGITAL EQUIPMENT CORPORATION Complaint develop re generally reluctant to devote development resoun :oven microprocessor product for which there is no den mand. The need simultaneously to secure a large number order to make the product attractive to software develop ~cure the efforts of software developcrs in order tomak, attractive to users is often referred to as "nctwork effects tance of these network effects is ilustrated by Intel' s I , in obtaining commitments from many computer manuf: software vendors to build computcrs and write so ftwa 1ew 64-bit Merced microproccssor, even though the mo be available for more than a year. r the market for Windows NT-compatible iarket for general-purpose microprocessors )cessor product must be compatible with the ng system. Two other microprocessor ed Windows NT support, but Windows NT . architectures was recently discontinued olumes. Any new entrant would likely need ystem sales in order to succeed in obtaining r the new microprocessor architecture.

ROPOSED TRANSACTION ON COMPETITION the proposed acquisition by Intel of Digital's and operations, including the facilities and ,rocessor manufacturing, and of Digital's I marketing organization, is likely to create e future competitive viability of Alpha and nhance Intel's market power and thereby Ice quality and innovation in each of the )ed above in paragraphs 1 I - , for reasons limited to, the following:

likely that Digital would maintain the sales ant market" sales of Alpha microprocessors allU VL J other OEMs, it would reduce competition between ;ital for such sales; and b. : s supply of Alpha solely in the hands of Intel uJd: opportunity to delay production of Alpha :roi 'ede the development of new gcnerations of FEDERAL TRADE COMMISSION DECISIO Decision and Order 126 F. Alpha micropn'MoM , and otherwise undermine the competitiveness of Alpha.

G. VIOLATIONS CHARGED 24. The agl nt between Digital and Intel, if consummated would viola'" , n 5 of the Federal Trade Commission Act, as amended, 1 C. 45 , and Section 7 of the Clayton Act, as amended, 1: . 18.

DECISION AND ORDER The Fed, de Commission ("Commission ), having initiated an investiga . the proposed transaction through which Intel Corporation ) is to acquire certain assets of Digital Equipment Corporation tal"), including the s miconductor fabrication facility at Vv digital manufactures its Alpha family of microprocessors; gital having represented to the Commission its plans to conl :veloping and promoting Alpha microprocessors ,the ~ the microprocessor facility; and Digital having :d San :Iectronics Co., Ltd. to develop, manufacture and pham ,cessors and having entered into a Memorandum lderst, with Advanced Micro Devices, Inc. , that lplate Jarable license; and it now appearing that Digital mesn to as the "respondent " is willing to enter into an lentcc 19 an order in order to confirm its future plans for and tc je for other relief, and respondent having been led w opy of a draft complaint that the Bureau of :tition ,sented to the Commission for its consideration lich, i ! by the Commission, would charge respondent iolatio le Clayton Act and Federal Trade Commission resp' its attorneys, and counsel for the Commission there. ecuted an agrecment containing a consent order IISSlon Jondent of all the jurisdictional facts set forth in resaid f complaint, a statement that the signing of said lent is element purposes only and does not constitute an ion by ldent that the law has been violated as alleged in )mplai waivers and other provisions as required by the Lommission; and DIGITAL EQUIPMENT CORPORA non Decision and Order , having thereafter considered the matter and hat it had reason to believe that the respondent . Acts, and that a complaint should issue stating respect, and having thereupon accepted the eement and placed such agreement on the public fsixty (60) days, now in further conformity with ribed in Section 2. 34 of its Rules, makes the nal findings and enters the following order: ligital is a corporation organized, existing, and . and by virtue of the laws of the Commonwealth with its office and principal place of business ermill Road, Maynard, Massachusetts.

:ade Commission has jurisdiction of the subject ding and of the respondent, and the proceeding sl.

ORDER , as used in this order, the following definitions " or Digital" means Digital Equipment irectors, officers, employees, agents and cessors, successors, and assigns; its subsidiaries d affliates controlled by Digital Equipment ,spective directors, offcers, employees, agents ,ssors, and assigns of each.

Intel Corporation, a corporation organized usiness under and by virtue of the laws of the with its offce and principal place of business on College Boulevard, Santa Clara, California. Advanced Micro Devices, Inc., a corporation md doing business under and by virtue of the )elaware, with its offce and principal place of 'ne AMD Place, P. O. Box 3453 , Sunnyvale Lal International Business Machines, Inc. , a cor, existing, and doing business under. and by :. .

Decision and Order 126F. 1.L. 4-1-.. 1....,,. f the State of Delaware, with its offce and iness located at 1 New Orchard Road, Armonk :ans Samsung Electronics Co., Ltd., a Korean ffces located at San #24 , Nongaeo-Lee nn- , Kyungki- , Korea.

a RlSC Architecture means the architecture as t edition, or previous edition, of Digital' s Alpha ference Manual, published by or on behalf of la Implementation means a microprocessor gital' s Alpha RISC Architecture designed by or ses of illustration only and without limiting the the following implemcntations constitutes a )digital Alpha Implementation: EV4, EV5 , EV6 ice means a 64-bit microprocessor that : design and circuitry as, and is equivalent in , a Digital Alpha Implementation, and that 1) Alpha RISC Architecture, 2) executes Digital' and 3) meets appropriate Digital quality and cations means the product specifications for a Architecture implementation from and after EV67, EV68, EV7, etc.), as set forth in the d the Device Quality and Reliability Data Sheet ital as amended from time to time, which define , performance, electrical, timing, mechanical Jility, and other requirements of the Digital nay refer to, and thereby incorporate, other ling without limitation, logic or other design :ations.

means a semiconductor integrated circuit Jplicable Device Specification and embodying ific logic design of Digital's Alpha RISC entation for EV56, EV6 and for any Future n as designed and manufactured by or on behalf "1 Implementation means a semiconductor ee meeting the applicable Device Specification g., GITAL EQUIPMENT CORPORATJ( Decision and Order e applicable specific logic design of a Digital Alpha e implementation beyond EV56 aJ1n FV6 (e. , etc.) as designed and manufact\ by or on ice" means a 64-bit microprocessor c._u, ned by or :onforms to Digital' s Alpha - - - Architecture, 2) : Alpha instruction set ant leets appropriate d branding criteria.

rivative means a 64-bit microprocessor derived Device or AMD Device, that incorporates a improvement designed by or for AMD and 1) ais Alpha RISC Architecture, 2) executes Digital' set and 3) meets appropriate Digital quality and Products means integrated circuits designed ing, but not limited to Alpha Devices, AMD krivatives. AMD Licensed Products shall RISC, POWER PC and MIPS families of Microprocessor means an AMD Licensed . microprocessor.

means a fully qualified, packaged and tested ted circuit, that 1) is based upon and conforms gital' s Alpha RlSC Architecture, 2) embodies Jrovidcd to Samsung by Digital corresponding including updates by Digital thereto, and 3) Specification, Branding Standard and Product es.

'Architecture Device means a microprocessor gned by or on behalf of Samsung and that 1) Alpha RlSC Architecture, as specified in :cture Reference Manual, as revised from time xecutes Digital' s Alpha instruction set, and 3) nding Standard and Product Qualification ivative means a semiconductor integrated ng the design of Digital' s EV56 or EV6 Alpha implementation (or any Future Alpha ed to Samsung) as the case may be, including FEDERAL TRi 1 ' ) by Digital and updates made thereto by g Device, and with such additions, deletions ements and redesigns made by Samsung to a ding, but not limited to, design package, testing IS result in a final device having any of the It no other changes) to a Samsung Device: size due to mask size change and/or due to ; process technology;

reduction, addition, or replacement of SRAM ,sign of cache memory architecture, including tion to change I/O interfaces; .

, fit or function of the EV56 or the EV6 ,ther than changes or modifications to the EV6 , for purposes of this subsection shall be msung Device, excluding the I/O pad ring and the Alpha RISC Architecture, or any change (iii) or (iv) above, to the Device Specification Procedures or the form, fit or function of the Specification, in either case, which has been specifically )y Digital in its sole discretion, in accordance with the pr' , Section 3.3 (b )(ii) of the Samsung License Agreement in paragraph Il.A. of this order. S. Alp! ocessor Technology means the information materials, a: ,gy relating to any Digital Alpha Implementation and ase pha architectural specification including, but not limited database and schematics, test programs and vectors, mo n data simulation results, all HAL, PAL, and BIOS codes :umentation and customer product documentaupdates.

lucts means Digital commercial software generate or optimize binary code for Digital :ans Digital CAD Tools, including all updates ign, development and manufacture of Digital 'ns.

DIGITAL EQUIPMENT CORPORATION Decision and Order , Tools means Digital software tools as to which ght to grant a license, including all updates, used to Iize binary code for Digital Alpha Implementations. , Technology means Alpha Microprocessor 1ware Products (in both source and object code tools (in both source and object code form), FX!32 1 source and object code form) and CAD Tools (in Jbject code form).

'tellectual Property Rights with regard to paragraph neans all patents, patent applications, copyrights how and trade secrets owned by Digital covering ha Implementation, 2) Digital's Alpha RlSC ) Digital Technology; and, with regard to paragraph Digital Intellectual Property Rights" has the same forth in Section 1.6 of the Samsung License ed to in paragraph lii.A. of this order, covering l) plementation, 2) Digital's Alpha RlSC Architecture mology.

means the Federal Trade Commission.

(!tal Settlement means all transactions and emplated by, or necessary to implement, the ment Between Digital Equipment Corporation and , dated October 26, 1997.

oftware shall mean the Digital software known as e emulation and background binary translation of ,ative Alpha code and associated documentation , meaning all corrections, bug fixes, modifications s to the FX!32 Software, in both object or source by or for Digital.

II.

edered That:

nt shall grant a license, by the date this order Advanced Micro Devices, Inc. ("AMD"), or to a ves the prior approval of the Commission, and only eceives the prior approval of the Commission and ith the framework of the Memorandum of tered into between Digital and AMD, dated March DU"), which provides inter alia:

Decision and Order 126 F. Intellectual Property Rights, a non-exclusive petual license, without the right to sublicense )rovided herein) to design, develop, manufacture , and to market, distribute and sell worldwide ucts Intellectual Property Rights, a non-exclusive petual license, without the right to sublicense provided herein), to use, modify, copy, and ks of the Alpha Microprocessor Technology for the extent required to enable AMD' s exercise of lted pursuant to paragraph II. l. of this order; nt sublicenses (without the right to grant further re than two third parties (as agreed to by Digital U) under rights granted to AMD in paragraph manufacture, use and sell AMD 64-bit provide Infrastructure Partners technology I by AMD, even if such technology incorporates secrets or know-how contained in the Alpha nology, and to grant sublicenses (without the r sublicenses) such third parties under such ave made, use or sell products (other than AMD ors) based upon or incorporating such cture Partners " shall mean (subject to the terms vendors, BIOS vendors, independent software Ipanies in the business of designing and selling )perate with AMD Licensed Products;

ntellectual Property Rights, a non-exclusive letual license (without the right to sublicense) ,ols, in object code form, and CAD Tool e sole purpose of assisting AMD internally in Qt and manufacture of AMD Licensed Products f the CAD Tool Documentation solely to the able AMD to implement the terms of internal shall also grant AMD a non-exclu ive ;e (without the right to sublicense) to one copy or each licensed CAD Tool for evaluation IJUlj ntellectual Property Rights, a non-exclusive non etuallicense (without the right to sublicense) DIGITAL EQUIP\LENT CORPORATION Dccision and Order : Software Products, in object code form, for the sisting AMD in the design, development and 1a Devices, AMD Devices and AMD Derivatives on and optimization of binary code for Alpha 'ices and AMD Derivatives;

.1 Intellectual Property Rights, a non-exclusive :rpetuallicense (without the right to sublicense) create derivative works of the Software Tools, in rce code form, for internal use only, for the sole eration and optimization of software code for 1D Devices and AMD Derivatives. AMD shall ht to provide and sublicense the Software Tools ms thereof, in object code form, to independent ISVs ) for internal use only, for the sole purpose Itimizing the ISVs' own binary code for operation em having an Alpha Device, AMD Device or . a central processing unit. AMD and such ISVs ight to market, distribute or sell any Software )t use the Software Tools to develop, market product similar to the Software Tools. Digital will In-exclusive, non-transferable, perpetual license ) sublicense) to one copy of the source code for are Tool for evaluation purposes only;

Intellectual Property Rights, (i) a non-exclusive :rpetuallicense (without the right to sublicense) I create derivative works ofFX!32 Software, in Jrce code form, for internal use only, and (ii) a transferable, perpetual license to reproduce and lftware, in object code form, either directly or IOrized distribution channels in conjunction with es of Alpha branded products. Digital FX!32 shall be furnished by Digital to AMD on a ny modification, enhancements or adaptations to (eloped by AMD shall be furnished by AMD to -exclusive, perpetual, transferable, royalty-free ht to sublicense in object code or source code Intellectual Property Rights, the right to modify Upha RISC Architecture, without approval from Decision and Order 126 F. oduce AMD Devices and AMD Derivatives accordance with such modified or extended :al fails to establish and implement a roadmap that :mance, as measured by speed, of then-current 1-current SPECfp, as appropriate, of the highest ;or by at least 25 percent every three years. agree, if requested by the licensee, to submit all lse agreement described in paragraph II.A. of this rbitration. Respondent agrees to provide the n (10) days notice of an intention to terminate any escribed in paragraph II.A. of this order. Other itations, nothing in this paragraph shall limit :k redress for any breach of the license agreement Iph II.A. of this order.

f paragraph 11 of this order is to establish the ed licensee as an independent provider of Alpha ) promote the Alpha Architecture and Alpha and competitive microprocessor and to remedy mpetition resulting from the effects of the lent, as alleged in the Commission s complaint. . paragraph 11 of this order is to establish the endent provider of innovation in Alpha Device .ining the ability of computer systems based on lied by Digital and computer systems based on lied by the licensee to run thy same software and icroprocessor components.

)f approval by the Commission of the licensee ion by the proposed licensee to the Commission ;iness plan demonstrating that the licensee will processor Technology to develop, manufacture able and competitive Alpha Device free of all continuing relationships with Intel in the of Alpha Devices.

approval by the Commission of the license shall y Digital to the Commission of an acceptable mstrating the manner in which Digital shali ; efforts as required by paragraph II ofthis order. notice to Digital from the liccnsec, Digital shall chn istance and know-how related to such assistance DIGITAL EQUIPMENT CORPORATION Decision and Order ith respect to the manufacture of, and the provision engineering support for, all Alpha Devices to be sold by the licensee. Such technical assistance shall t limitation, consultation with knowledgeable sital and training at the facilities of Digital. Digital :asonable costs incurred in providing such technical ling reimbursement (commensurate with the salary digital personnel involved) for the time plus expenses nel providing the technical assistance. Digital shall de such technical assistance until AMD is satisfied . of producing, and of developing for production leable Alpha Devices; provided, however, Digital red to continue providing such technical assistance nore than two (2) years after the date on which the by paragraph II.A. of this order is approved by the iration of the technical assistance obligations of this order, respondent shall take such actions as are ntain the viability and marketability of the Alpha fechnology and Digital's Alpha RISC Architecture , or 1e destruction, removal, wasting, deterioration 'Y of these intellectual property assets. rdered That:

:nt shall grant a license, by the date this order , Samsung Electronics Co. , Ltd. ("Samsung ), or a ives the prior approval ofthe Commission, and only receives the prior approval of the Commission and 1 the framework of the License Agreement Between ,ung, dated June 5 , 1996, the Supplemental License od into between Digital and Samsung, dated Apri14 nse Agreement" ) and the Alpha Marketing and nse Agreement entered into between Digital and April 4, 1998 (the "Marketing Agreement"), which , a 'plicable Digital Intellectual Property Rights transferable, perpetual license, without the right cision and Order 126 F. to subl'r'pn('p sign, develop, and manufacture, and market distribt 8r1dwide Samsung Devices and Samsung Alpha Archite 2. ' receive from Digital the product technology packag n the License Agreement and Digital know-how ( specif cease Agreement) necessary for the design of Samson lch technology package may be used by Samsung to desi; md manufacture Samsung Alpha Architecture Device ng Derivatives under the terms of the License Agreen lve a third party design a portion of the Samsung Alpha. Device, provided that the third party design is undert, on behalf of Samsung in accordance with the terms a ,set forth in Section 4 of the License Agreement; :able Digital Intellectual Property Rights, a non-ex, :ransferable, perpetual license (without the right to subli the CAD Tools, in object code form, and related documl he sole purpose of assisting Samsung internally in the ( opment and manufacture of Samsung Devices Samson chitecture Devices, Samsung Derivatives and Other 1 :uits in accordance with the terms and conditions set fort; of the License Agreement, and to make copies of suc1 tion solely to the extent necessary to enable Samson ent the terms of such internal use licenses; and ble Digital Intellectual Property Rights, the right to repr stribute FX!32 Software, in object code form (includ .vements and derivatives thereto made by Digital) for use )randed products.

B. 19ree, ifrequested by the licensee, to submit an dispute 3e agreement described in paragraph lI1.A. ofthis order 1 rbitration. Respondent agrees to provide the Comm 1 (10) days notice of an intention to terminate any license escribed in paragraph lI1.A. ofthis order. Other than t!- itations, nothing in this paragraph shall limit Digital .1( redress for any breach ofthe license agreement describe Jh II1.A. of this order. C.D iter into an agreement whereby it shall grant the licensee :Iusive right to market and sell the licensee Alpha D . Digital' s "AlphaPowered" trademark. EQUIPMENT CORPORATION Decision and Order Jcure Alpha Devices from the licensee in accol 18 of the Marketing Agreement. ragraph II of this order is to establish the licen lent provider of Alpha Devices in order to prom litecture and Alpha Devices as a viable and coml essor and to remedy the lessening of coml Jm the effects of the Intel/Digital Settlement as aJ Imission s complaint. Another purpose of para! order is to establish the licensee as an in del f innovation in Alpha Device design while mam If computer systems based on Alpha Devices supp computer systems based on Alpha Devices supp: to run the same software and use the same non-I nponents.

approval by the Commission of the licensee shall by the proposed licensee to the Commission of an ss plan demonstrating that the licensee wil use tl 8essor Technology to develop, manufacture mark Jle and competitive Alpha Device free of all direc ltinuing relationships with Intel in the mam \lpha Devices.

Jroval by the Commission ofthe license shall be th )jgital to the Commission of an acceptable busir rating the manner in which Digital shan supp' arts as required by paragraph II ofthis order. wide the licensee consulting services and train: Section 2. 1(c) of the License Agreement. of the technical assistance obligations of para! order, respondent shall take such actions as aren n the viability and marketability ofthe Alpha Micr logy and Digital's Alpha RISC Architecture "no I ruction, removal, wasting, deterioration, or e intellectual property assets.

IV.

That within six months after the date this al shan, subject to the prior approval of the an agreement with IBM or some other tal will work with IBM or such other Decision and Order 126F.TC. companycompan,In PV" IllMesettingit as aforthfoundrythe andstepsprovidenecessaryIBM orto suchbecomeothera ,f Digital Devices, Alpha Devices, and Digitalqualifiec Itions to Digital under Digital' quality,Alpha oduction criteria within six (6) months after theperform. date the n approves such agreement; provided, however ltes to the Commission that the agreement is notifDigitanecessar, this purpose, then Digital need not submit any to this paragraph IV.agreeme It iered That respondent shall comply with al1 reqUlrem licenses or agreements entered pursuant to this order, an lses or agreements are incorporated by reference into this lade a part hereof. Any failure by respondent to comply \ !uirements of such licenses or agreements shall constitut, o comply with this order. VI.

It is) red That:

Atan respondent has signed thc agreement containing consent c matter, the Commission may appoint an Interim Trustee t, :spondent s performance of its responsibilities as required I r and by any license or agreement implementing this orde g, but not limited to, any license agreement - 1 any licensee, as provided in paragraphs I1 and II hin ten (10) days after acceptance by the ic comment of the agreement containing consent lal1 submit the name and qualifications of and m to serve as Interim Trustee.

irustee shall have the power and authority to compliance with the terms of this order and with iance with any other agreement implementing S, but not limited to, any license agreement Jhs 1I and 1I. The Interim Trustee may be the ed pursuant to paragraph VILA. of this order. 19reement with the Interim Trustee shall confer e al1 the rights and powers necessary to permit DIGITAL EQUIPMENT CORPORATION Decision and Order the ee to monitor respondent's compliance with the tern . and any other agreement implementing this order incl . limited to, any license agreement as provided in pare I Trustee shall serve until the licensees approved pur raphs II and II of this order have received all the tech ,sistance provided for in those paragraphs. In no ever lall the Interim Trustee serve for more than two (2) year :e this order becomes final. 1 Trustee shall have full and complete access to resp onnel, books, records, documents, facilities and tech ation relating to the research, development man portation, distribution and sale of any product or tech :ed by this order, or to any other relevant info the Interim Trustee may reasonably request inch limited to, all documents and records kept in the norr . business that relate to the manufacture of any proc ,y this order. Respondent shall take no action to intel impede the Interim Trustee s ability to monitor resp liance with paragraphs II and 1I ofthis order or any other nplementing this order, including, but not limited , a eement as provided in paragraphs II and II in this orde Trustee shall serve, without bond or other security, atth ,spondent, on such reasonable and customary terms and, he Commission may set. The Interim Trustee shall hav. I employ, at the expense of respondent, such con mtants, attorneys and other representatives and assl reasonably necessary to carr out the Interim Tru md responsibilities. The Interim Trustee shall acca penses incurred, including fees for his or her serv ) the approval of the Commission. shall indemnify the Interim Trustee and hold the 1harmless against any losses, claims, damages uses arising out of, or in connection with, the Interim Trustee s duties, including all reasonable d other expenses incurred in connection with the . defense of, any claim whether or not resulting in Jt to the extent that such liabilities, losses, damages ,CIS IONS 126 F.

suit from misfeasance, gross negligence, willful :I faith by the Interim Trustee.

ision determines that the Interim Trustee has to act diligently, the Commission may appoint m may on its own initiative or at the request of sue such additional orders or directions as may Jpropriate to assure compliance with the der and any other agreement implementing this ot limited to, any license agreement as provided II of this order.

stee shall evaluate reports submitted to it or the al. The Interim Trustee shall report in writing Ice by respondent with the provisions of )fthis order to the Commission every three (3) , respondent signs the agreement containing he term of the Interim Trustee expires, as reports shall include at least the following: dent has executed the licenses and agreements aphs n and II of this order;

ldent has given the Interim Trustee access to , paragraph VIA. of this order;

lsees have issued any sublicenses under )f this order; the names, addresses, and phone sublicensee; and the purpose and terms under ave been given sublicenses;

Ie degree to which Digital has provided the nd know-how to licensees as required under II.H. of this order;

has refused to allow any licensee to sublicense ,s are making any good faith efforts to develop or sell any of the products covered by licenses under paragraphs 1I and II of this order, and, to the extent such sales have been made, the gross s, g. T gital and any licensee in implementing their Commi JUsiness plans and the extent to which the agreem Jaragraphs n.D. and E. and III.F. and G. of this ord DIGITAL EQUIPMENT CORPORATION Decision and Order VII.

That:

lot executed the licenses and agreements, and nission s approval for such licenses and by paragraphs 11 and II of this order, then the ,oint a trustee to grant the licenses or enter into t with the terms set forth in paragraphs II and ;tee shall have a1l rights and powers necessary ) enter into the licenses and agreements so as to ,Iish the remedial purposes of this order. In the m or the Attorney General brings an action 15 (I) of the Federal Trade Commission Act, her statute enforced by the Commission, Digital Jpointment of a trustee in such action. Neither trustee nor a decision not to appoint a trustee ;hall preclude the Commission or the Attorney civil penalties or any otherrelief(including, but rt-appointed trustee) pursuant to the Federal :t or any other statute, for any failure by any of lply with this order.

pointed by the Commission or a court pursuant of this order, Digital shall consent to the mditions regarding the trustee s powers, duties ;ibilities:

n shall select the trustee, who shall be a person xpertise in acquisitions and licenses.

Jrior approval of the Commission, the trustee e power and authority to enter into the licenses ed by paragraphs II and II ofthis order in order ,edial purposes of this order.

0) days after appointment of the trustee ute a trust agreement that, subject to the prior )mmission (and, in the case of a court-appointed rt), transfers to the trustee all rights and powers nit the trustee to enter into the licenses and ,d by paragraphs II and II of this order so as to mplish the remedial purposes of this order. ..

FEDERAL TRAE COMMISSION DECISIONS Decision and Order 126 F.TC. 4. The shall have twelve (12) months from the date the trust agree I , approved by the Commission to accomplish the license req JY this order, which shall be subject to the prior approval 0 :ommission. If, however, at the end of the twelve (12) monlf, the trustee has submitted a plan of license or believes th 1se can be achieved within a reasonable time, the license peri y be extended by the Commission (or, in the case of a court-apl I trustee, by the court); provided, however, the Commissic extend this period only two (2) times. 5. The e shall have full and complete access to the personnel, I records, and facilities related to the Alpha Devices or Digital ny other relevant information, as the trustee may request. Di Jail develop such financial or other information as such truste 1 request and shall cooperate with the trustee. Responden take no action to interfere with or impede the trustee s ac ishment of the license. Any delays in licensing caused by 1 pondent shall extend the time for licensing under this paragn (in an amount equal to the delay, as determined by the Commi, in the case of a court-appointed trustee, by the court).

6. That shall use his or her best efforts to negotiate the most favorable p d terms available in each contract that is submitted to the CO! , subject to the absolute and unconditional obligation ;ital to license at no minimum price; provided however, If trustee shall not negotiate any price or terms with AMD less' Jle to respondent than those set forth in the MOU referred to . graph II of this order. The license shall be made in the manner ) the licensee or licensees, as set out in paragraphs I1 and II of der; provided, however, if the trustee receives bona fide offers more than one licensee, and if the Commission approves m m one such licensee, then the trustee shall license to the enti entities selected by Digital from among those .. L ,mmission.

hall serve, without bond or other security, at the Digital, on such reasonable and customary terms he Commission or a court may set. The trustee to employ, at the cost and expense of Digital :ountants, attorneys, investment bankers, business , and other representatives and assistants as are out the trustee s duties and responsibilities. The DIGITAL EQUIPMENT CORPORATION Decision ,md Order 'or all monies derived from the license and all after approval by the Commission (and, in the lted trustee, by the court) of the account of the ; for his or her services, all remaining monies ection of Digital and the trustee s power shall lstee s compensation shall be based at least in )mmission arrangement (based on sales price) s accomplishing the license required by this ,mnifY the trustee and hold the trustee harmless .ims, damages, liabilities, or expenses arising 1 with, the performance of the trustee s duties Ie fees of counsel and other expenses incurred e preparation for, or defense of any claim g in any liability, except to the extent that such mages, claims, or expenses result from ligence, willful or wanton acts, or bad faith by ses to act or fails to act diligently, a substitute inted in the same manner as provided in is order.

m (or, in the case ofa court-appointed trustee )wn initiative or at the request of the trustee )rders or directions as may be necessary or ish the license required by this order.

I have no obligation or authority to operate or croprocessor Technology.

hall report in writing to Digital and the ty (30) days concerning the trustee s efforts to VII That within thirty (30) days after the date , and every thirty (30) days thereafter until the licenses and agreements required by the IS 11, 11 and IV of this order, respondent shall ;ion verified written reports setting forth in orm in which respondent intends to comply, Qmplied with paragraphs 11, 11 and IV of this , ;

Dccision and Order 126 F.TC. order. Resp( shall include in its compliance reports, among other things required from time to time, a full description of the efforts b. :Ie to comply with paragraphs II, II and IV of the order, inclu description of all substantive contacts or negotiations license and the identity of all parties that have contacted re: It or that have been contacted by respondent. IX.

It is furth ,red That one (1) year from the date this order becomes fim lily for the next six (6) years on the anniversary of the date tI r becomes final, and at such other times as the Commission :quire, respondent shall fie a verified written report with t lmission setting forth in detail the manner and form in which ;complied and is complying with the licenses and agreements r by paragraphs II, II, and IV of this order. It is furth, That respondent shall notify the Commission at least thirty ys prior to any proposed change in the corporate respondent dissolution, assignment, sale resulting in the emergence 01 ,ssor corporation, the creation or dissolution of subsidiaries other change in respondent that may affect compliance 0 ids arising out of the order. XI.

It is furth ?red That, for the purpose of determining or securing comj with this order, respondent shall permit any duly authorized re Itives of the Commission: A. During hours and in the presence of counsel, access to facilities and. o inspect and copy all books, ledgers, accounts correspond 10randa and other records and documents in the possession he control of respondent relating to any matters contained il order; and B. UpOl (5) days notice to respondent, and without restraint or interfen to interview offcers, employees, or agents of respondent.

Xll.

It is Jim rdered That this order shall terminate on June 16 2005.

F ASTLINE PUBLICA nONS, DIe., ET AL.

Complain!