DISMISSAL AND LICENSE OPTION AGREEMENT

Exhibit 10.2

DISMISSAL AND LICENSE OPTION AGREEMENT

This Dismissal and License Option Agreement (this “Agreement”) is made and entered into as of this          day of May, 2009 (the “Effective Date”), by and between OPTi, Inc., a California corporation having its place of business at 3430 W. Bayshore Road, Suite 103, Palo Alto, California 94303 (“OPTi”) and Atmel Corporation, a Delaware corporation having its place of business at 2325 Orchard Parkway, San Jose, California 95131, acting on behalf of itself and its Subsidiaries (Atmel Corporation and its Subsidiaries, collectively, “Atmel”). OPTi and Atmel are individually referred to as a “Party” and collectively as the “Parties”.

WHEREAS, OPTi has filed patent infringement claims against Atmel and other co-defendants in the Civil Action No. 2:07-cv-00278-TJW (E.D. Tex.) (the “Lawsuit”).

WHEREAS, Atmel denies that it does now or has ever infringed any of the patents asserted in the Lawsuit or committed any act that would entitle OPTi to any of the relief it is seeking from Atmel in the Lawsuit; and

WHEREAS, OPTi and Atmel desire to avoid the time and expense of litigation, and in compromise of the disputed claims, to dismiss the Lawsuit against Atmel and grant Atmel an option to acquire a license from OPTi as set forth in this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the undertakings and options granted herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the aforementioned Parties agree as follows:

As used herein:

a. “Asserted Patents” shall mean any and all patents asserted by OPTi in the Lawsuit, including without limitation U.S. Patent No. 5,944,807 and U.S. Patent No. 6,098,141, and any patent or patent application that claims priority directly or indirectly to, or from which priority is directly or indirectly claimed with respect to, any of the foregoing patents or any patent or patent application to which the foregoing patents claim priority, whether or not pending, issued, expired, abandoned or closed, including without limitation any and all reexaminations, reissues, continuations, divisions, continuations-in-part and foreign counterparts of any of the foregoing patents anywhere in the world.

b. “Dismissal Period” shall mean the period commencing on the Effective Date and ending forty-five (45) days after the Final Resolution (as defined in paragraph 3 of this Agreement).

c. “Subsidiary” of a specified Party shall mean any corporation or other entity that is directly or indirectly controlled by such Party. For purposes of this definition, control means (i) direct or indirect ownership of, or the exclusive right to acquire ownership of, more than fifty percent (50%) of the outstanding shares or securities entitled to vote for the election of directors or similar managing authority of an entity; or (ii) the direct or indirect right to vote or to direct the vote (by written proxy or otherwise) of more than fifty percent (50%) of the ownership interest representing the right to elect directors or similar managing authority of an entity. An entity shall be deemed to be a Subsidiary under this Agreement at any time that the requisite conditions of being a Subsidiary are met, except that entities which are co-defendants in the Lawsuit may not become Subsidiaries of Atmel for the purposes of this Agreement.

a. The Parties hereby agree that the Lawsuit between the Parties, including all claims made by OPTi against Atmel therein, shall be fully and promptly dismissed without prejudice. Within five (5) business days after the Effective Date, each Party shall cause its counsel to have signed and filed all necessary dismissals, stipulations, orders and other documents with respect to the Lawsuit to effect a complete dismissal without prejudice of all claims, demands and causes of action brought by OPTi against Atmel and all claims by Atmel against OPTi in the Lawsuit. The Parties shall proceed with any and all additional procedures necessary to dismiss such claim without prejudice.

b. In accordance with Section 2.a above, Atmel shall pay OPTi one hundred twenty five thousand U.S. dollars ($125,000) (the “Dismissal Payment”) by wire transfer within five (5) business days after entry of an Order of Dismissal.

c. During the Dismissal Period, OPTi will not bring any claim or suit alleging infringement of or to otherwise assert any of the Asserted Patents: (i) against Atmel or any Subsidiary of Atmel; or (ii) against any direct or indirect Atmel customer, distributor, OEM, dealer, reseller, user, vendor, manufacturing or assembly facility, assembly or testing facility or other third party with respect to any Atmel product or service (alone or in combination with other components) manufactured, used, sold, offered for sale, imported or otherwise exploited by such entity. The preceding sentence shall be referred to as the “Standstill Obligation.” The Standstill Obligation shall run with the title of the Asserted Patents, and shall be binding on OPTi’s successors, assigns, licensees, and any other person or entity who obtains from OPTi a direct or indirect ownership or other interest (including any enforcement right) in or to the Asserted Patents. The Standstill Obligation shall not constitute and shall not be deemed to constitute a release of or license to Atmel or any of its customers, and any injunctive or monetary relief that OPTi may be entitled to recover against Atmel or its customers shall continue to accrue during the Dismissal Period and shall not be limited, diminished or abated by OPTi’s compliance with the Standstill Obligation. Neither shall OPTi’s compliance with the Standstill Obligation be deemed to constitute a waiver or estoppel of or laches as to any monetary or equitable right of recovery that OPTi may have against Atmel or its customers.

d. During the Dismissal Period, Atmel shall refrain from bringing suit seeking a declaration as to the noninfringement, invalidity, or unenforceability of the Asserted Patents, or seeking reexamination or reissuance of the Asserted Patents or similar relief.

“Final Resolution” of the Lawsuit shall occur upon the resolution of all claims and counterclaims in the Lawsuit via any combination of the dismissal of claims and counterclaims, the entry of final judgment as to all claims and counterclaims, and/or the waiver of all rights of appeal as to such judgments. Within ten (10) business days of the Final Resolution, OPTi shall provide Atmel with written notice that the Final Resolution has occurred (the “Notice of Final Resolution”).

a. Commencing upon transmission of the Notice of Final Resolution and for a period of forty-five (45) days thereafter, Atmel shall have the right and option, in its sole discretion and without any obligation to exercise such option, to acquire the license to the Asserted Patents described below upon payment of the License Fee defined below and execution by Atmel and delivery to OPTi of the exercise notice attached as Exhibit A hereto (the “License Option Exercise Notice”). This option shall run with the title of the Asserted Patents, and shall be binding on OPTi’s successors, assigns, licensees, and any other person or entity who obtains from OPTi a direct or indirect ownership or other interest (including any enforcement right) in or to the Asserted Patents.

b. For purposes of this Agreement, the “License Fee” shall mean a payment by Atmel to OPTi of $25,000 by wire transfer.

c. Upon payment of the Licensee Fee and execution by Atmel and delivery to OPTi of the License Option Exercise Notice or upon termination by Atmel pursuant to Section 7.c, OPTi automatically and without the need for any further action or documentation grants to Atmel, and Atmel automatically and without the need for any further action or documentation receives a non-exclusive, worldwide, perpetual, irrevocable, paid up and royalty-free license, without the right to sublicense, under the Asserted Patents (and any related patents/filings) to make, have made, use, offer for sale, import and sell (directly and indirectly through multiple tiers of distribution) any products or services. For the avoidance of doubt, the restriction on sublicensing set forth herein shall not be interpreted to restrict Atmel’s right to engage with third parties in connection with the design, development, manufacturing, packaging, assembly, testing, sale, distribution and other similar activities with respect to Atmel’s products and services.

d. Upon Atmel’s payment of the License Fee and exercise of the license option as set forth in Section 4.c:

(i) OPTi releases, acquits and discharges Atmel and all of its officers, directors, employees and agents from and against any and all claims, demands, liabilities and rights of action of any kind and nature, at law, in equity, or otherwise, known and unknown, suspected and unsuspected, disclosed and undisclosed, which OPTi may have or obtain relating to the Asserted Patents or the Lawsuit, including without limitation those arising on account of any infringement or alleged infringement of any Asserted Patent (whether direct, contributory or by inducement, and whether or not willful); and

(ii) OPTi releases, acquits and discharges Atmel’s direct and indirect past, present and future customers, retailers, wholesalers, distributors, dealers, resellers, users, OEMs, vendors, manufacturing or assembly facilities, assembly or testing facilities, and other similar companies from and against any and all claims, demands, liabilities and rights of action of any kind and nature, at law, in equity, or otherwise, known and unknown, suspected and unsuspected, disclosed and undisclosed, relating to any infringement or alleged infringement of any of the Asserted Patents (whether direct, contributory or by inducement, and whether or not willful) or otherwise related to the Lawsuit, to the extent