MIPS Technologies and Lexra Resolve Lawsuit - Lexra Becomes a MIPS32 Architecture Licensee

Lexra to Transition into a Fabless Semiconductor Company Focusing on the Internet Infrastructure Industry

MOUNTAIN VIEW & SAN JOSE, Calif.--(BUSINESS WIRE)--Dec. 31, 2001-- MIPS Technologies, Inc. (Nasdaq:MIPS - news; Nasdaq:MIPSB - news), a leading provider of industry-standard processor architectures and cores for digital consumer and network applications, and Lexra Inc., a leading developer of portable RISC, DSP and NPU processor technology, today announced the resolution of the pending lawsuit between the two companies as part of an agreement reached between the two companies that includes Lexra becoming a MIPS32(TM) architecture licensee.

Lexra will shift from the intellectual property (IP) licensing business and become a fabless semiconductor company while at the same time licensing the MIPS32 architecture for use in its upcoming network infrastructure chip. Under the terms of the license agreement, Lexra acknowledges the validity and enforceability of MIPS Technologies patents. As Lexra is exiting the IP licensing business, Lexra will assign its processor IP assets over to MIPS Technologies and both companies will work together to convert Lexra's current customers into MIPS Technologies' customers.

"We strongly support Lexra's new direction as a fabless semiconductor company," said John Bourgoin, chairman and CEO of MIPS Technologies. "Lexra has a proven capability in applying processor expertise to new applications and we enthusiastically welcome Lexra as a licensee and member of the MIPS community as they pursue new opportunities within the growing communications marketplace."

"This agreement comes about as communications companies increasingly prefer to purchase rather than develop complex network processing components and we are excited about the opportunities this represents to us as we transition into a fabless semiconductor company," said Charlie Cheng, president and CEO of Lexra, Inc. "It gives Lexra the chance to provide an innovative chip solution to our network infrastructure customers, and at the same time work with MIPS Technologies as partners."

About MIPS Technologies

MIPS Technologies, Inc. is a leading provider of industry-standard processor architectures and cores for digital consumer and network applications. The company drives the broadest architectural alliance that is delivering 32- and 64-bit embedded RISC solutions. The company licenses its intellectual property to semiconductor companies, ASIC developers and system OEMs. MIPS Technologies and its licensees offer the widest range of robust, scalable processors in standard, custom, semi-custom and application-specific products. The company is based in Mountain View, Calif., and can be reached at 650/567-5000 or www.mips.com.

About Lexra

Lexra, Inc. is currently converting its business model to become a fabless semiconductor company after successfully establishing itself as an innovator in embedded microprocessor technology with a proven track record for customer success. To date, Lexra has delivered seven different processor architectures to over 30 licensees in six different countries. Lexra is headquartered in San Jose California. Further company information can be found at http://www.lexra.com.

This press release contains forward-looking statements regarding the business of MIPS Technologies, Inc. Actual events or results may differ materially. Many factors could cause the actual results to differ materially from those contained in such forward-looking statements, including but not limited to: that products will fail to achieve market acceptance, increases in our research and development expenses, the anticipated benefits of our partnering relationships may be more difficult to achieve than expected, the MIPS Technologies' ability to develop, introduce and market new products and product enhancements, and the level of demand for semiconductors and end-user products that incorporate semiconductors. With respect to MIPS Technologies, we refer you to the documents that it files from time to time with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended June 30, 2001 and subsequent Forms 10-Q and 8-K.

Note to Editors: MIPS® is a registered trademark and MIPS32(TM) is a trademark of MIPS Technologies, Inc. in the United States and other countries. Lexra® is a registered trademark of Lexra, Inc. All other trademarks referred to herein are the property of their respective owners.