Business Cooperation Agreement Between Intel Corporation and Silicon Image, Inc.

INTEL and SILICON IMAGE CONFIDENTIAL

Exhibit 10.01

CONFIDENTIAL TREATMENT REQUESTED

Business Cooperation Agreement
Between Intel Corporation and Silicon Image, Inc.
for
Unified Display Interface

This Business Cooperation Agreement (“Agreement”) is entered into as of April 26, 2005 (the “Effective Date”) by and between Silicon Image, Inc. a Delaware corporation, having an office at 1060 E. Arques Avenue, Sunnyvale, California, U.S.A, (“SI” or “Silicon Image”) and Intel Corporation, a Delaware corporation, having an office at 2200 Mission College Blvd., Santa Clara, California 95052, U.S.A. (“Intel”).

Purpose

The purpose of the Unified Display Interface (“UDI”) effort is to define, promote and enable wide industry adoption of a new display interconnect specification (“Specification”) for use in PC’s, digital monitors (e.g. LCD displays) and embedded notebook displays, which provides interoperability between such devices and HDMI television displays.

Whereas, Silicon Image presently licenses its Transition Minimized Differential Signaling (TMDS) protocol and encoding algorithm in the PC and Consumer Electronics segments;

Whereas, Intel presently has a UDI Specification draft in progress, and has joined with Silicon Image and desires to join with additional promoters to develop the Specification for use in desktop PC and mobile PC display applications that can be adopted generally as an open industry specification by a broad group of Adopters in order to enhance the demand for products that comply with the Final Specification;

Whereas, Silicon Image is willing to make available the TMDS interface and all necessary claims pertaining to the TMDS interface and associated Panel Interface Logic (“PIL”) needed for broad adoption of the Specification on terms described herein; and

Whereas, Intel and Silicon Image desire to encourage broad adoption of the Specification and collaborate as Promoters to license the necessary claims contained in the Specification under a reasonable and non-discriminatory licensing framework agreed to by such Promoters. The Parties will mutually agree on and invite other companies to join a Promoters group to define and ready the Specification for release to Adopters.

Now Therefore, in consideration of the mutual covenants and promises contained herein, the parties agree as follows:

INTEL and SILICON IMAGE CONFIDENTIAL

1. Definitions.

Unless otherwise provided in this Agreement, defined terms that are herein capitalized will have the meaning ascribed to them in the Promoters Agreement attached hereto as Attachment A.

“CNDA” means the Confidential Information Disclosure Agreement # 94185 dated between the Parties.

“HDMI 1.x” means that next version of the HDMI Specification to be published by the HDMI Founders (as such term is described in the HDMI Specification) subsequent to the most recently released version of the HDMI specification (HDMI version 1.1).

“HDMI 1.x+1” means that next version of the HDMI Specification to be published by the HDMI Founders (as such term is described in the HDMI Specification) subsequent to the HDMI 1.x version of the HDMI Specification.

“HDMI Specification” means the specification for the High-Definition Multimedia Interface.

“Party” or “Parties” means Intel or Silicon Image or Intel and Silicon Image collectively.

“Promoters” means Intel, Silicon Image and such other parties as the initial Promoters may elect to include in the Promoters group under the procedures set forth in the Promoters Agreement and that sign the Promoters Agreement.

“Promoters Agreement” means that agreement entered into between Intel, SI and certain other parties relating to the promotion of the UDI Specification and attached hereto as Attachment A.

“Sink” means a digital electronic device that is fully compliant with the HDMI specification and has passed all applicable HDMI compliance tests, such device being adapted to receive and process, from a Source or repeater device, a digital data signal representative of video and/or audio data for rendering such digital data signal to a display (in the case of video data) and/or an audio rendering system (in the case of audio data), solely in accordance with the HDMI specification.

“Source” means a digital electronic device that is fully compliant with the HDMI specification and has passed all applicable HDMI compliance tests, such device being adapted to process a digital signal representative of video and/or audio data and, upon processing, to transmit the processed digital data signal or sub-set of such digital data signal to a Sink or repeater device for producing a visual image and/or audio sound as represented by the processed digital data signal, solely in accordance with the HDMI specification.

INTEL and SILICON IMAGE CONFIDENTIAL

2. Specification Scope and Objectives.

2.1 Scope. The Specification Scope is as defined in the Promoters Agreement, and shall consist of those video protocols in the DVI specification, UDI protocol, performance extensions based on TMDS protocols, and a new PCI Express-based electrical layer. The Parties recognize that subject matter outside of, and not required for implementation of the Specification (but which may be optional or desirable) may be subject to royalty bearing intellectual property licensing. Although those video protocols in the DVI specification will be part of the Specification, there is no intent to change existing DVI licensing. For avoidance of misinterpretation among Specification Adopters, the Parties shall work with the other Promoters to ensure the Draft, Interim and Final Specification reflect this. The Parties also do not intend to supersede or modify existing DVI or HDMI licenses or any obligations of third parties to license DVI or HDMI.

2.2 Objective. The Specification objective is to define a unified display interface using TMDS encoding which has the following characteristics:

3. Intel Deliverables.

3.1 Intel will contribute link layer definition, physical layer definition, UDI port electricals and timing definition, and will license the Necessary Claims in these contributions to the Promoters and Adopters under the reasonable and non-discriminatory licensing framework planned by the Promoters for the Specification. [***]

*** Note: Confidential treatment has been requested with respect to the information contained within the [***] marking. Such portions have been omitted from this filing and have been filed separately with the Securities and Exchange Commission.

INTEL and SILICON IMAGE CONFIDENTIAL

3.2 For the purpose of maintaining compatibility between UDI and HDMI, Intel agrees to collaborate with Silicon Image in coordinating with the HDMI Founders (as defined in the HDMI Specification Adopter Agreement) in defining and making necessary changes to the HDMI Specification.

3.3 Intel intends to remain an HDMI Adopter (as defined in the HDMI Specification Adopter Agreement) during the term of this Business Cooperation Agreement and therefore, if changes authorized by the HDMI Licensing, LLC are made to the HDMI Specification in order to ensure interoperability with the UDI Specification (revisions 1.0 through 2.0), and Intel has necessary claims (as defined in the HDMI Adopters Agreement) needed for those changes, then Intel agrees to the terms of the Non-Assertion clause for Adopters in the HDMI Specification Adopter Agreement, for such necessary claims.

3.4 [***]

3.5 [***]

3.6 Intel agrees to apply engineering resources necessary to develop the Specification in an expedient manner.

4. Silicon Image Deliverables.

4.1 Silicon Image will identify and provide descriptions of the TMDS interface and PIL (e.g., the necessary intellectual property in the non-electrical section of the DVI 1.0 specification including TMDS, PIL electronics) needed for broad adoption of the Specification across multiple market segments. Silicon Image will contribute the TMDS interface and the PIL and will license the Necessary Claims therein to the Promoters and Adopters under the reasonable and non-discriminatory licensing framework agreed to by the Promoters for the Specification on a zero dollar royalty basis. Such zero-dollar royalty offer to license may be conditioned upon, among other things, the licensee’s grant of a reciprocal license with a corresponding royalty rate equaling zero and such condition shall be deemed within the meaning of “reasonable and nondiscriminatory terms” as provided above. While the Promoters do not intend to supersede or in any way modify the terms of the HDMI Specification License (the “HDMI License”) or the DVI Specification License (the “DVI License”), it is Silicon Image’s intent to use its commercially reasonable efforts to ensure that the Specification and Silicon Image’s contributions to the UDI Specification provide interoperability and compatibility between a UDI Source and HDMI 1.x Sink.

*** Note: Confidential treatment has been requested with respect to the information contained within the [***] marking. Such portions have been omitted from this filing and have been filed separately with the Securities and Exchange Commission.

INTEL and SILICON IMAGE CONFIDENTIAL

4.2 HDMI 1.x and HDMI 1.x+1

With respect to UDI being compliant with the HDMI Specification, Silicon Image will use its commercially reasonable efforts to introduce, propose or otherwise submit changes targeted at two different anticipated revisions of the HDMI Specification, which promote or provide interoperability between UDI and HDMI, for the consideration of the HDMI Founders for inclusion in the HDMI specification; such changes are listed below under the headings “HDMI 1.x Will Cover” and “HDMI 1.x+1 Will Cover”. The Parties acknowledge that SI has no authority to make changes to the HDMI Specification and that there is no guarantee that either HDMI 1.x or HDMI 1.x+1 will be published or that if published such versions of the HDMI Specification will contain the items set forth below. Performance by SI of its obligations hereunder is a necessary precondition of the Parties performing their respective Specification definition and promotion obligations under this Agreement. The qualifications contained in the preceding sentence shall apply to all items identified under this Section 4.1. For mutual planning and discussion purposes only, the Parties set forth below a timetable for proposed revisions to the HDMI Specification.

4.3 HDMI 1.x Will Cover: