-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: keymaster@town.hall.org
Originator-Key-Asymmetric:
MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq
pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ==
MIC-Info: RSA-MD5,RSA,
nVAyn/ozjtdYx2YbfmsvfOHnc2GW9+2Azbaj9sQJYCfIGu9h+waEdQHl59C0ILMX
2yEEXc9LweOwnAazng2RTA==

<IMS-DOCUMENT>0000950131-95-000530.txt : 19950615
<IMS-HEADER>0000950131-95-000530.hdr.sgml : 19950615
ACCESSION NUMBER: 0000950131-95-000530
CONFORMED SUBMISSION TYPE: 10-K
PUBLIC DOCUMENT COUNT: 19
CONFORMED PERIOD OF REPORT: 19941225
FILED AS OF DATE: 19950307
SROS: NYSE

FILER:

COMPANY DATA:
COMPANY CONFORMED NAME: ADVANCED MICRO DEVICES INC
CENTRAL INDEX KEY: 0000002488
STANDARD INDUSTRIAL CLASSIFICATION: 3674
IRS NUMBER: 941692300
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1227

FILING VALUES:
FORM TYPE: 10-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-07882
FILM NUMBER: 95519009

BUSINESS ADDRESS:
STREET 1: 901 THOMPSON PL
STREET 2: P O BOX 3453
CITY: SUNNYVALE
STATE: CA
ZIP: 94088
BUSINESS PHONE: 4087322400
</IMS-HEADER>
<DOCUMENT>
<TYPE>10-K
<SEQUENCE>1
<DESCRIPTION>FORM 10-K
<TEXT>

<PAGE>

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K
(MARK ONE)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934.

FOR THE FISCAL YEAR ENDED DECEMBER 25, 1994

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM TO

COMMISSION FILE NUMBER 1-7882

ADVANCED MICRO DEVICES, INC.
(Exact name of registrant as specified in its charter)

DELAWARE
(State or other jurisdiction of
incorporation or organization)

94-1692300
(IRS Employer
Identification Number)

ONE AMD PLACE
SUNNYVALE, CALIFORNIA
(Address of principal executive offices)

94088-3453
(Zip Code)

Registrant's telephone number, including area code: (408) 732-2400

Securities registered pursuant to Section 12(b) of the Act:

(TITLE OF EACH CLASS) (NAME OF EACH EXCHANGE ON
WHICH REGISTERED)

$.01 PAR VALUE COMMON STOCK NEW YORK STOCK EXCHANGE
PREFERRED STOCK PURCHASE RIGHTS NEW YORK STOCK EXCHANGE
DEPOSITARY CONVERTIBLE EXCHANGEABLE NEW YORK STOCK EXCHANGE
PREFERRED STOCK

Securities registered pursuant to Section 12(g) of the Act:

NONE

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
<PAGE>

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

Aggregate market value of the voting stock
held by nonaffiliates as of February 27, 1995.

$2,813,646,457

Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.

95,942,821 SHARES AS OF FEBRUARY 27, 1995.

DOCUMENTS INCORPORATED BY REFERENCE

(1) Portions of the Annual Report to Stockholders for the fiscal year ended
December 25, 1994, are incorporated into Parts I, II and IV hereof.

(2) Portions of the Proxy Statement dated on or before March 31, 1995, for the
Annual Meeting of Stockholders to be held on May 9, 1995, are incorporated
into Part III hereof.

2
<PAGE>

PART I

ITEM 1. BUSINESS

GENERAL

Advanced Micro Devices, Inc. was incorporated under the laws of the state
of Delaware on May 1, 1969. The mailing address of its executive offices is One
AMD Place, P.O. Box 3453, Sunnyvale, California 94088-3453, and its telephone
number is (408) 732-2400. Unless otherwise indicated, the terms the
"Corporation" and "AMD" in this report refer to Advanced Micro Devices, Inc. and
its subsidiaries.

The Corporation designs, develops, manufactures and markets complex
monolithic integrated circuits for use by manufacturers of a broad range of
electronic equipment and systems.

PRODUCTS

The Corporation's products primarily consist of standard or catalog items
or are made from designs based on such items, as opposed to custom circuits
designed for a single customer. While a substantial portion of AMD's products
are standard or catalog items, increasingly many of its recently developed
products are designed for specific applications such as telecommunications,
personal computers, engineering workstations, optical disk memory or local area
networks. As a service to certain major customers, the Corporation modifies
portions of these application-specific devices to meet specific customer needs.
The resulting devices are produced in significant volumes for such customers.

AMD began as an alternate-source manufacturer of integrated circuits
originally developed by other suppliers and has gradually shifted to proprietary
products (i.e., products resulting from the Corporation's design or technology
innovations). The Corporation has made a significant commitment to research and
development which has contributed toward its becoming a leader in manufacturing
and process technology within the integrated circuit industry.

The Corporation has focused its product development activities on the three
areas of its business: (1) X86, K86 and other microprocessors and related
embedded processors for personal computers, (2) applications solutions products,
and (3) high-volume commodity products such as programmable logic and non-
volatile memory devices.

Personal computer (PC) products include microprocessors and related
embedded processors used in computers. AMD's applications solutions products
are focused on networks, voice/data communications (WORLD NETWORK/R/), and on
computer peripherals, computer interfaces and mass storage. High-volume
commodity products include programmable logic devices ("PLDs") and other non-
volatile memory devices (such as FLASH Memory). PLDs and FLASH Memory devices
are typically produced by more than one manufacturer, subject to intense
competition, and broadly applicable across a wide customer base. Since most of
the Corporation's products are utilized in personal computers and related
peripherals, the Corporation's future growth is closely tied to the performance
of the PC industry.

3
<PAGE>

Microprocessors

X86 Microprocessors. A microprocessor is the central processing unit (CPU)
of a computer. A microprocessor processes system data and controls
input/output, peripheral and memory devices. A microprocessor may also be used
in connection with other processors such as microcontrollers which are embedded
microprocessors contained in peripherals or other coprocessors which perform
certain functions such as arithmetic calculations. The X86 architecture,
originally developed by Intel Corporation, has been the leading architecture for
personal computer microprocessors. AMD's X86 microprocessor strategy has been
to serve as an alternative source for X86 microprocessors, introducing products
at comparable prices to competitive products, but with additional customer-
driven features. In 1993, the Corporation entered into a license agreement with
Microsoft/R/, the personal computer industry's leading supplier of operation
systems software, pursuant to which the Microsoft Windows/TM/ compatible logo
now appears on AMD's microprocessor packaging and advertising indicating that
the Corporation's product is compatible with such software. The Corporation
believes that this approach is consistent with what it perceives to be the
computer industry's shift from an emphasis on hardware compatibility to software
compatibility.

In the second quarter of 1993, the Corporation began to offer its Am486/TM/
family of products. The Corporation began shipping Am486DX products in the
second quarter of 1993, and began volume shipment of its Am486SX products in
1994. The 486DX family of microprocessors accounted for approximately thirty-
seven percent (37%) of the Corporation's 1994 revenues. A significant portion
of the Corporation's total revenues, profits, and margins were attributable to
Am486 products. Prior to a settlement with Intel Corporation in January, 1995,
the Corporation's Am386 and Am486 products were the subject of microcode
litigations with Intel Corporation. (For more information see Item 3, Legal
Proceedings, Number 2.).

Embedded Control Microprocessors. The Corporation's proprietary
Am29000/TM/ family of RISC microprocessors is used extensively by a wide range
of customers for embedded control applications. Examples of these applications
include high-performance laser printer controllers, high-resolution graphics
controllers, communications controllers, and accelerator cards.

K86 Microprocessors. The Corporation expects that, in the second half of
1995, it will offer its next generation of microprocessor products known as the
K86, based on superscalar RISC-type architecture. The K86 products are
designed to be compatible with operating system software such as Microsoft
Windows. Production of the initial K86 products, known as K-5, is presently
scheduled to commence in the second half of 1995. The Corporation is currently
in the process of developing additional K86 products. The K86 products are not
designed to use any Intel copyrighted microcode; however, they do rely on patent
licenses from several companies, including Intel Corporation.

Applications Solutions Products

Computer Systems, Interfaces and Mass Storage. The Corporation offers a
range of products which are utilized in a variety of computer systems. Such
products include integrated circuits that work with central processing units to
manage selected input/output system functions such as to control disk drives,
keyboards, printers and communications and networking devices.

The Corporation also supplies a range of products specially designed to add
additional functions, improve performance and reduce costs in computer
peripheral, interface or mass storage applications. These are generally
special-purpose products

4
<PAGE>

which are designed for a specific application. In the case of some large
customers, these products are tailored for specific customer needs.

Networks and Voice/Data Communications. The Corporation provides a wide
variety of products for a broad spectrum of connectivity solutions. These
include applications in central office switches, PBX equipment, voice/data
terminals, and different performance classes of Local Area Networks (LANs) used
to connect workstations and personal computers. In addition to providing the
integrated circuits for these applications, the Corporation also provides
various forms of hardware evaluation tools, development software and interface
software. The Corporation offers several Ethernet products designed for use on
personal computer motherboards and add-in cards. AMD also is a supplier of
chip sets to support the 100-megabit-per-second Fiber Distributed Data Interface
(FDDI) local area network standard which is primarily used in network backbones
and to connect high performance workstations and servers. The Corporation has
also developed, in cooperation with systems manufacturers, a family of devices
for the 10Base-T standard, which allows transmission of data using Ethernet
protocols on twisted-pair wiring, rather than on the more expensive coaxial
cable.

The Subscriber Line Interface Circuit (SLIC) and the Subscriber Line Audio-
Processing Circuit (SLAC/TM/) are an integral part of a design for digital
telephone switching equipment. The SLIC connects the user's telephone wire to
the telephone company's digital switching equipment. The SLAC is a
coder/decoder which converts analog voice signals to a digital format and back.

High-Volume Commodity Products

Programmable Logic Devices (PLDs). The Corporation is a supplier of high-
speed, field-programmable integrated circuits. PLDs generally afford a user
increased design flexibility relative to standard logic devices. The initial
design time and design cost in customizing a programmable device is
significantly less than designing a custom integrated circuit or customizing a
gate array logic device.

Non-Volatile/Volatile Memories. Memory components are used to store
computer programs and data entered during system operation. There are two types
of memory storage capability, volatile and non-volatile. Volatile memories
include Dynamic and Static Random Access Memories (DRAMs and SRAMs). Non-
volatile memories retain data when system power is shut off, while volatile
memories do not. Non-volatile memories include Erasable Programmable Read-Only
Memories (EPROMs) and FLASH Memory.

The Corporation's memory products are primarily non-volatile memories used
in a wide range of applications such as PCs, workstations, peripherals,
instrumentation, PBX equipment, avionics and a variety of other equipment where
programmed data storage is needed. The Corporation offers a family of CMOS
EPROM devices from 64K (64,000 bits) to 4 megabits (4,000,000 bits) in density.

The Corporation has also developed a family of FLASH Memories to address
the emerging market for PC memory cards, solid-state disks, cellular
communications and networking applications.

Joint Venture with Fujitsu Limited. In 1993, AMD and Fujitsu Limited
(Fujitsu) formed a joint venture for the development, manufacture and sale of
integrated circuits. Through the joint venture, the two companies have
constructed and are operating an $800 million wafer fabrication facility in
Aizu-Wakamatsu, Japan to produce non-volatile memory devices such as EPROMs and
FLASH Memories. The new facility is presently scheduled to begin volume
production in late 1995, and will utilize eight-inch wafers and process
technologies capable of producing products with geometries of one-half (0.5)
micron or

5
<PAGE>

smaller. AMD and Fujitsu will not independently produce EPROM and FLASH Memory
products with geometries of one-half (0.5) micron or smaller outside of the
joint venture. Currently, the primary mission of the joint venture is the
production of FLASH Memory devices.

The percentages of the equity of the joint venture owned by the Corporation
and Fujitsu are 49.95% and 50.05%, respectively. Each company contributes
toward funding and supporting the joint venture in proportion to its ownership
percentage. AMD is expected to contribute approximately one-half of its share
of funding in cash as equity investment, and may be required to guarantee third
party loans made to the joint venture for the remaining one-half. Each company
is obligated to invest up to approximately $200 million as equity in the joint
venture. (For more information, see Item 7, Management's Discussion and Analysis
of Results of Operations and Financial Condition contained in the 1994 Annual
Report to Stockholders ("Management's Discussion").) In connection with the
joint venture, the Corporation and Fujitsu have entered into various joint
development, cross-license and investment arrangements. Accordingly, AMD and
Fujitsu will provide their product designs and process and manufacturing
technologies to the joint venture. In addition, both companies will collaborate
in developing manufacturing processes and designing integrated circuits for the
joint venture. The right of each company to use the licensed intellectual
property of the other with respect to certain products is limited to certain
geographic areas. Consequently, AMD's ability to sell certain products
incorporating Fujitsu intellectual property, whether or not produced by the
joint venture, is also limited in certain territories, including the United
Kingdom and Japan.

MARKETING AND SALES

AMD markets and sells its products primarily to original equipment
manufacturers (OEMs) of computation and communication equipment. AMD's products
are sold under the AMD/R/ trademark. The Corporation has an agreement with
Compaq Computer Corporation (Compaq) under which the Corporation supplies Compaq
with microprocessor products; however, the agreement does not require Compaq to
purchase microprocessor products from the Corporation. The Corporation sells to
a broad base of customers; no single customer accounted for more than ten
percent (10%) of sales during the fiscal year ended December 25, 1994. The
Corporation employs a direct sales force through its principal facilities in
Santa Clara County, California, and field offices throughout the United States
and abroad (primarily Europe and the Asia-Pacific Basin). The Corporation also
sells its products through third-party distributors and independent
representatives in both domestic and international markets pursuant to
nonexclusive agreements. The distributors also sell products manufactured by
AMD's competitors, including those products for which the Corporation is an
alternate source.

Distributors typically maintain an inventory of AMD's products. The
Corporation, pursuant to its agreements with the distributors, employs
procedures which provide protection to the distributors for their inventory of
AMD's products against price reductions as well as products that are slow moving
or have been discontinued by the Corporation. These agreements, which may be
canceled by either party on a specified notice, generally contain a provision
for the return of AMD's products to the Corporation in the event the agreement
with the distributor is terminated. (See Note 1 of Notes to Consolidated
Financial Statements contained in the 1994 Annual Report to Stockholders.)

AMD has established sales subsidiaries that have offices in Belgium,
Canada, China, France, Germany, Hong Kong, Italy, Japan, Korea, Singapore,
Sweden, Switzerland, Taiwan, and the United Kingdom. (See Note 11 of Notes to
Consolidated Financial Statements contained in the 1994 Annual Report to
Stockholders.) The international sales force also works with independent sales
representatives and distributors in approximately 34 countries, including those
where AMD has sales subsidiaries. The Corporation's

6
<PAGE>

international sales operations entail political and economic risks, including
expropriation, currency controls, exchange fluctuations, changes in freight
rates, and changes in rates and exemptions for taxes and tariffs. The
Corporation has not experienced any material adverse effects associated with
such risks. (For more information, see Item 7, Management's Discussion.)

BACKLOG

AMD manufactures and markets a standard or catalog line of products.
Consequently, a significant portion of its sales are made from inventory on a
current basis. Sales are made primarily pursuant to (1) purchase orders for
current delivery of standard items, or (2) agreements covering purchases over a
period of time, which are frequently subject to revision and cancellation.
Generally, in light of current industry practice and experience, the Corporation
does not believe that such agreements provide meaningful backlog figures or are
necessarily indicative of actual sales for any succeeding period.

COMPETITION

Historically, the semiconductor industry has experienced rapid
technological advances together with substantial price reductions in maturing
products. After a product is introduced, prices normally decrease over time as
production efficiency and competition increase, and a successive generation of
products is developed and introduced for sale. Competitive factors in the
semiconductor industry center primarily around market acceptance, timing of new
products and a product's performance, price and availability.

Numerous firms compete with AMD in the manufacture and sale of integrated
circuits. Some of these firms have resources greater than those of the
Corporation and do not depend upon integrated circuits as their principal source
of revenue. There is also significant captive production by certain large users
of integrated circuits, such as manufacturers of computers, telecommunications
equipment and consumer electronics products.

AMD competes for integrated circuit market share with Texas Instruments,
Motorola, National Semiconductor, Intel, North American Philips, and with
several prominent Japanese firms. These firms include Nippon Electric Co.,
Hitachi, Toshiba, Fujitsu, Matsushita and Mitsubishi, all of whom are making
active efforts to increase their respective and collective worldwide market
shares. (For more information concerning Fujitsu, see the discussion on the
joint venture with Fujitsu above.)

All of the above-mentioned competitors are either substantially larger in
both gross sales and total assets than AMD or are part of larger corporate
enterprises to whose resources, financial and other, the competitors have
access. In addition to the above, many other companies dedicated to only one or
two process technologies and product types compete with the Corporation in those
technologies and product types.

RESEARCH AND DEVELOPMENT

The Corporation's expenses for research and development in 1992, 1993 and
1994, were $227,860,000, $262,802,000, and $279,984,000, respectively. Such
expenses represented 15.0%, 16.0% and 13% of sales in 1992, 1993 and 1994,
respectively. AMD's research and development expenses are charged to operations
as incurred. Most of the research and development personnel are integrated into
the engineering staff.

MANUFACTURING

Product design and development, and wafer fabrication activities are
currently conducted at AMD's facilities in California and in Texas. A
subsidiary of Sony

7
<PAGE>

Corporation manufactures bipolar products for the Corporation in San Antonio,
Texas, using equipment owned by AMD. Nearly all product assembly and final
testing are performed at the Corporation's manufacturing facilities in Penang,
Malaysia; Singapore; and Bangkok, Thailand, or by subcontractors in Asia. A
limited amount of testing of products destined for delivery in Europe and Asia
is performed at the Corporation's facilities in Basingstoke, England. (See also
the discussion on the joint venture with Fujitsu above.)

Foreign manufacture entails political and economic risks, including
political instability, expropriation, currency controls and fluctuations,
changes in freight rates and in interest rates, and exemptions for taxes and
tariffs. For example, if the Corporation were not able to assemble and test its
products abroad, or if air transportation between the United States and these
facilities were disrupted, there could be a material adverse effect on the
Corporation's operations. The Corporation has not experienced any material
adverse effects associated with such risks.

In July 1993, the Corporation commenced construction of its 700,000 square
foot submicron semiconductor manufacturing facility in Austin, Texas (FAB 25).
The Corporation estimates that the cost of this facility will be approximately
$1.3 billion when fully equipped. The facility is presently scheduled to
commence volume production in late 1995.

In early 1994, the Corporation entered into an agreement with Digital
Equipment Corporation ("Digital") under which Digital agreed to provide a
foundry in Queensferry, Scotland, for production of the Corporation's Am486
products. In late 1994, Digital commenced production of Am486 wafers for the
Corporation. The Digital foundry was acquired in late 1994 by Motorola, Inc. and
the foundry arrangement has been assumed by Motorola. The Corporation also
entered into a foundry arrangement in the third quarter of 1994 with Taiwan
Semiconductor Manufacturing Corporation, Ltd. (TSMC) for production of AMD's
Am486 microprocessors. Volume production under the TSMC arrangement is
presently scheduled to commence before the end of 1995. The TSMC arrangement
extends through 1997.

Raw Materials. Certain of the raw materials used by the Corporation in
the manufacture of its products are available from a limited number of
suppliers in the United States and elsewhere. For example, for several types of
the integrated circuit packages that are purchased by AMD, as well as by the
majority of other companies in the semiconductor industry, the principal
suppliers are Japanese companies. Shortages could occur in various essential
materials due to interruption of supply or increased demand in the industry. If
AMD were unable to procure certain of such materials from any source, it would
be required to reduce its manufacturing operations. To date, the Corporation
has not experienced significant difficulty in obtaining the necessary raw
materials.

Environmental Regulations. The Corporation is subject to a variety of
governmental regulations related to the use, storage, handling, discharge or
disposal of toxic, volatile or otherwise hazardous chemicals used in the
manufacturing process. The Corporation believes that it is currently in
compliance in all material respects with these regulations and that it has
obtained all necessary environmental permits to conduct its business, which
permits generally relate to the discharge of hazardous wastes. Nevertheless, the
failure to comply with present or future regulations could result in fines being
imposed on the Corporation, suspension of production, alteration of the
Corporation's manufacturing processes or cessation of operations. Such
regulations could require the Corporation to acquire expensive remediation
equipment or to incur other expenses to comply with environmental regulations.
(See Item 3, Legal Proceedings, Number 1.) Any failure by the Corporation to
control the use, disposal or storage of, or adequately restrict the discharge
of, hazardous substances could subject the Corporation to future liabilities.

8
<PAGE>

INTELLECTUAL PROPERTY AND LICENSING

The Corporation and its subsidiaries have been granted 820 United States
patents, and approximately 469 patent applications are pending in the United
States. In certain cases, the Corporation has filed corresponding applications
in foreign jurisdictions. The Corporation expects to file future patent
applications in both the United States and abroad on significant inventions as
it deems appropriate. The Corporation has entered into numerous cross-licensing
and technology exchange agreements under which it both transfers and receives
technology and intellectual property rights. Although the Corporation attempts
to protect its intellectual property rights through patents, copyrights, trade
secrets and other measures, there can be no assurance that the Corporation will
be able to protect its technology adequately or that competitors will not be
able to develop similar technology independently. There can be no assurance
that any patent applications that the Corporation may file will be issued or
that foreign intellectual property laws will protect the Corporation's
intellectual property rights. There can be no assurance that any patent
licensed by or issued to the Corporation will not be challenged, invalidated or
circumvented or that the rights granted thereunder will provide competitive
advantages to the Corporation. Furthermore, there can be no assurance that
others will not independently develop similar products, duplicate the
Corporation's products or design around the patents licensed by or issued to the
Corporation.

From time to time AMD has been notified that it may be infringing
intellectual property rights of others. If any such claims are asserted against
the Corporation, the Corporation may seek to obtain a license under the third
party's intellectual property rights. The Corporation could decide, in the
alternative, to resort to litigation to challenge such claims. Such challenges
could be extremely expensive and time consuming and could materially adversely
affect the Corporation's business, financial condition and results of
operations. No assurance can be given that all necessary licenses can be
obtained on satisfactory terms, nor that litigation may always be avoided. (See
also Item 3, Legal Proceedings, Number 2.)

EMPLOYEES

On December 25, 1994, AMD and its subsidiaries employed approximately
11,800 employees.

ITEM 2. PROPERTIES

The Corporation's principal engineering, manufacturing, warehouse and
administrative facilities comprise approximately 2 million square feet and are
located in Santa Clara County, California and in Austin, Texas. (See Item 1,
Manufacturing and Item 7, Management's Discussion). Over 1.25 million square
feet of this space is in buildings owned by the Corporation.

In 1992, the Corporation entered into certain operating leases and an
arrangement for the purchase of certain property containing a building with
approximately 318,000 square feet, located on 45.6 acres of land in Sunnyvale,
California (One AMD Place). In early 1994, the Corporation began utilizing One
AMD Place for its corporate sales, marketing and administrative offices. This
arrangement provides the Corporation with the option to purchase One AMD Place
during the lease term. At the end of the lease term, the Corporation is
obligated to either purchase One AMD Place or arrange for the sale of One AMD
Place to a third party with a guarantee of residual value to the seller of One
AMD Place. In 1993, the Corporation entered into a lease agreement for
approximately 175,000 square feet located adjacent to One AMD Place to be used
in connection with One AMD Place.

The Corporation also owns or leases facilities containing approximately
722,800 square feet for its operations in Malaysia, Singapore and Thailand.
(See Item 1, Manufacturing and Item 7, Management's Discussion). Of the entire

9
<PAGE>

worldwide facilities owned or leased by the Corporation, approximately 588,000
square feet are currently vacant. In addition, approximately 700,000 square feet
are currently vacant until the construction of the Corporation's new
manufacturing facility in Austin, Texas (FAB 25) is completed in 1995. The
Corporation holds 74 undeveloped acres of land in the Republic of Ireland. The
Corporation also has an equity interest in 58 acres of land in Albuquerque, New
Mexico.

The Corporation leases 33 sales offices in North America and 16 sales
offices in Asia and Europe for its direct sales force. These offices are
located in cities in major electronics markets where concentrations of AMD's
customers are located.

Leases covering the Corporation's facilities expire over terms of generally
1 to 20 years. The Corporation anticipates no difficulty in either retaining
occupancy of any of its facilities through lease renewals prior to expiration or
through month-to-month occupancy, or replacing them with equivalent facilities.
(See Note 13 of Notes to Consolidated Financial Statements contained in the
1994 Annual Report to Stockholders.)

ITEM 3. LEGAL PROCEEDINGS

1. Environmental Matters. Since 1981, the Corporation has discovered,
investigated and begun remediation of three sites where releases from
underground chemical tanks at its facilities in Santa Clara County, California
adversely affected the groundwater. The chemicals released into the
groundwater were commonly in use in the semiconductor industry in the wafer
fabrication process prior to 1979. At least one of the released chemicals
(which is no longer used by the Corporation) has been identified as a probable
carcinogen.

In 1991, the Corporation received four Final Site Clean-up Requirements
Orders from the California Regional Water Quality Control Board, San Francisco
Bay Region (RWQCB) relating to the three sites. One of the sites (Final Site
Clean-up Requirements Order No. 91-102) includes clean-up of groundwater
contamination from TRW Microwave, Inc. (TRW), Philips Semiconductor (formerly
Signetics Corporation) and the Corporation, which the RWQCB claims merged. The
Corporation is proceeding jointly with Philips and TRW to clean up the merged
contamination and the parties are contributing to the clean-up equally. However,
there has been no allocation of responsibility for the contamination between the
parties. Another of the sites (Final Site Clean-up Requirements Order Nos.
91-139 and 91-140) includes clean-up of groundwater contamination from National
Semiconductor Corporation, the Corporation and others, which the RWQCB claims
merged. National Semiconductor Corporation and the Corporation have been named
in the orders as primarily responsible and have commenced clean-up efforts in
accordance with their respective orders. However, there has been no allocation
of responsibility for the groundwater contamination. The third site (Final Site
Clean-up Requirements Order No. 91-101) is primarily the responsibility of the
Corporation.

In each instance mentioned above, the Corporation conducted appropriate
programs of remedial action that involved soil removal, installation of
monitoring and extraction wells and water treatment systems, disposal of
inoperative tank systems, and repair and alterations to existing facilities.
The final clean-up plans include continued groundwater monitoring, extraction
and treatment and, in one instance, soil vapor extraction. Federal and state
governmental agencies have approved the final clean-up plans being implemented.
The Corporation has not yet determined to what extent the costs of such remedial
actions will be covered by insurance. The three sites are on the National
Priorities List (Superfund).

10
<PAGE>

If the Corporation fails to satisfy federal compliance requirements or
inadequately performs the compliance measures, the government (a) can bring an
action to enforce compliance, or (b) can undertake the desired response actions
itself and later bring an action to recover its costs and penalties, up to three
times the costs of clean-up activities, if appropriate. It is expected that
these matters will not have a material adverse effect on the financial condition
or results of operations of the Corporation.

A notice dated October 3, 1994 was received by the Corporation from the
Department of Ecology of the State of Washington indicating that the Department
had determined the Corporation to be a potentially liable person for the release
of hazardous substances on a site located in Yakima, Washington. The
Corporation is currently investigating this claim. The Corporation believes
that the foregoing environmental matter will not have a material adverse effect
on the financial condition or results of operations of the Corporation.

2. AMD/Intel Litigations and Settlement. On January 11, 1995, the
Corporation reached an agreement with Intel Corporation ("Intel") to settle all
currently outstanding litigation between the companies. The terms of the
settlement include the following:

(1) AMD will have a fully paid-up, nonexclusive, world-wide, royalty-
free, perpetual license to copy and distribute the microcode and
control code in the Intel287(TM), Intel386(TM) and Intel486(TM)
microprocessor product families.

(2) AMD agreed that it has no right to copy any other Intel microcode
including the Pentium(TM) Processor microcode, the P6 microcode and
the 486 ICE (in-circuit emulation) microcode.

(3) The companies agreed to negotiate a new patent cross-license
agreement to become effective January 1, 1996.

(4) AMD agreed to pay Intel $58 million in settlement of claims for past
damages related to AMD's distribution of Am486(R) microprocessors
containing Intel's 486 ICE microcode. As ordered in a 1992
arbitration between the companies, Intel will pay AMD approximately
$18 million in damages (which includes interest) awarded by the
arbitrator for breach of contract and will not contest certain
rights granted AMD in the arbitration which are described more fully
below under "AMD/Intel Technology Agreement Arbitration." The
Corporation recorded both the ICE case damages and the arbitration
award in 1994.

(5) Intel and AMD will drop all cases against each other, including
appeals, currently pending in the courts.

(6) AMD will have the right to use foundries for Am486 products
containing Intel microcode for up to 20 percent of annual total unit
shipments of Am486 microprocessors.

(7) AMD and its customers will receive a license for Intel's "Crawford
'338" patent, covering memory management.

(8) The two companies agreed not to initiate legal action against one
another for any activity occurring prior to January 6, 1995.

The settlement agreement resolved the following legal proceedings which had
been pending between the companies:

<PAGE>

a. AMD/Intel Technology Agreement Arbitration. A 1982 technology
exchange agreement between AMD and Intel had been the subject of a dispute
which was submitted to arbitration through the Superior Court of Santa Clara
County, California. The dispute centered around issues relating to whether
Intel breached its agreement with AMD and whether that breach injured AMD, as
well as the remedies available to AMD for such a breach. In February 1992, the
arbitrator awarded AMD several remedies, including the following: monetary
damages and interest, a permanent, royalty-free, nonexclusive, nontransferable
worldwide right to all Intel copyrights, patents, trade secrets and mask work
rights, if any, contained in the then-current version of AMD's Am386 family of
microprocessors; and a two-year extension, until December 31, 1997, of the
copyright and patent rights granted to AMD under a 1976 Cross License Agreement
between AMD and Intel, insofar as those rights concern the Am386 microprocessor
family. Intel appealed the decision as it related to the technology award.
Ultimately a judgment on the award was entered in the Corporation's favor, and
the judgment was affirmed by the California Supreme Court. Pursuant to the
settlement, Intel will pay AMD $18 million in damages and interest pursuant to
the arbitrator's award and will drop further appeals of the judgment.

b. 287 Microcode Litigation. (Case No. C-90-20237, N.D. Cal.) On
April 23, 1990, Intel filed an action against the Corporation in the U.S.
District Court, Northern District of California, seeking an injunction and
damages with respect to the Corporation's 80C287, a math coprocessor designed to
function with the 80286. Intel's suit alleged several causes of action,
including infringement of Intel copyright on the Intel microcode used in its 287
math coprocessor, mask work infringement, unfair competition by means of false
advertising and unauthorized copying of the Intel 287 microcode by the third
party developer of the AMD 80C287. Pursuant to the settlement, AMD will have a
fully paid-up, non-exclusive, world-wide, royalty-free, perpetual license to the
microcode in the Intel287 microprocessor product family. A stipulation of
dismissal was filed January 26, 1995 and all claims, counterclaims and defenses
arising out of this action were dismissed with prejudice.

c. 386 Microcode Litigation. (Case No. A-91-CA-800, W.D. Tex. and
Case No.C-92-20039, N.D. Cal.) On October 9, 1991, Intel filed an action
against the Corporation in the U.S. District Court for the Western District of
Texas (Case No. A-91-CA-800, W.D. Tex.), This action was transferred to the
U.S. District Court, Northern District of California (Case No. C-92-20039, N.D.
Cal.).

In this action, Intel claimed copyright infringement of what Intel
described as: (1) its 386 microprocessor microcode program and revised programs,
(2) a "control program" stored in a 386 microprocessor programmable logic array
and (3) Intel In-Circuit Emulation (ICE) microcode. The complaint sought
damages and injunctive relief arising out of the Corporation's development,
manufacture and sale of its Am386 microprocessors and sought a declaratory
judgment concerning two license agreements between the companies, including a
claim for a declaratory judgment that AMD's license rights to Intel's microcodes
would expire on December 31, 1995, and that AMD would no longer be able sell
product containing Intel microcode after that date. Pursuant to the settlement,
AMD will have a fully paid-up, non-exclusive, world-wide, royalty-free,
perpetual license to the microcode in the Intel386 microprocessor product
family. A stipulation of dismissal was filed January 20, 1995 and all claims,
counterclaims and defenses arising out of this action were dismissed with
prejudice.

d. 486 Microcode Litigation. (Case No. C-93-20301 PVT, N.D. Cal.)
On April 28, 1993, Intel filed an action against AMD in the U.S. District Court,
Northern District of California, seeking an injunction and damages with respect
to the Corporation's Am486 microprocessor. The suit alleged several causes of
action, including infringement of various Intel copyrighted computer programs.
Intel sought damages and injunctive relief based on the following claims: (1)
AMD's alleged copying and distribution of 486

12
<PAGE>

"Processor Microcode Programs" and "Control Programs"; and (2) AMD's alleged
copying of 486 "Processor Microcode" as an intermediate step in creating
proprietary microcodes for the AMD version of the 486. Intel also sought a
declaratory judgment that (1) AMD had induced third-party copyright infringement
through encouraging third parties to import Am486-based products ; (2) AMD's
license rights to Intel microcode would expire as of December 31, 1995, and AMD
could no longer sell any products containing Intel microcode after that date ;
(3) AMD's license rights to Intel microcodes would not extend to In-Circuit
Emulation (ICE) microcode ("ICE Claim"); and (4) AMD would not be licensed to
authorize third party foundries to copy the Intel microcode. Intel also sought
damages and injunctive relief based on AMD's alleged copying and distribution of
Intel's "386 Processor Microcode Program" in AMD's 486 microprocessor.

Pursuant to the settlement, the parties agreed to dismiss all claims,
counterclaims and defenses raised in this action with the exception of the ICE
Claim. AMD consented to the entry of a permanent injunction prohibiting its
distribution of 486 products containing the ICE microcode after January 15, 1995
and agreed to pay $58 million to Intel for past damages relating to the ICE
Claim. AMD will have a fully paid-up, non-exclusive, world-wide, royalty-free,
perpetual license to the microcode in the Intel486 microprocessor product
family, excluding the 486 ICE microcode. AMD will have the right to use outside
foundries to produce Am486 microprocessors containing Intel microcode for up to
20 percent of its annual total unit shipments of Am486 microprocessors. The
parties have filed with the court a stipulation for the dismissal with prejudice
for this action and the entry of a permanent injunction relating to the ICE
Claim. The Corporation anticipates that the dismissal and the permanent
injunction will be entered by the court in accordance with the stipulation.

e. Antitrust Case Against Intel. On August 28, 1991, the
Corporation filed an antitrust complaint against Intel in the U.S. District
Court for the Northern District of California (Case No. C-91-20541-JW-EAI),
alleging that Intel engaged in a series of unlawful acts designed to secure and
maintain a monopoly in iAPX microprocessor chips. The complaint alleged that
Intel illegally coerced customers to purchase Intel chips through selective
allocations of Intel products and tying availability of the Intel 80386 to
purchases of other products from Intel, and that Intel filed baseless lawsuits
against AMD in order to eliminate AMD as a competitor and to intimidate AMD
customers. The complaint requested significant monetary damages, and an
injunction requiring Intel to license the 80386 and 80486 to AMD, or other
appropriate relief. Pursuant to the settlement, a stipulation of dismissal was
filed January 20, 1995 and all claims, counterclaims and defenses arising out of
this action were dismissed with prejudice.

f. Business Interference Case Against Intel. On November 12,
1992, the Corporation filed a proceeding against Intel in the Superior Court of
Santa Clara County, California (Civil Case No. 726343), for tortious
interference with prospective economic advantage, violation of California's
Unfair Competition Act, breach of contract and declaratory relief arising out of
Intel's efforts to require AMD's customers to pay to Intel patent royalties if
they purchased 386 and 486 microprocessors from AMD. The patent involved,
referred to as the Crawford '338 patent, covered various aspects of how the
Intel 386 microprocessor, the Intel 486 microprocessor and future X86 processors
manage memory and how these microprocessors generate memory pages and page
tables when combined with external memory and multi-tasking software such as
Microsoft Windows(TM), OS/2(R) or UNIX(R). The action was removed to the Federal
District Court (Case No. C-92-20789, (N.D. Cal.) where AMD amended its complaint
to include causes of action for violation of the Lanham Act and a declaration of
patent invalidity and unenforceability. The complaint alleged that Intel was
demanding royalties for the use of the Intel patents from the Corporation's
customers, without informing the Corporation's customers that the Corporation's
license arrangement with Intel protected the Corporation's customers from an
Intel patent infringement lawsuit. No royalties for the license were charged to

13
<PAGE>

customers who purchased these microprocessors from Intel. Intel filed a
counterclaim against AMD for inducing infringement of the Crawford '338 patent
by computer manufacturers and others. This case was stayed pending resolution
of the International Trade Commission Proceeding, discussed below. Pursuant to
the settlement, AMD and its customers will have a license for the Crawford '338
patent. A stipulation of dismissal was filed January 19, 1995 and all claims,
counterclaims and defenses arising out of this action were dismissed with
prejudice.

g. International Trade Commission Proceeding. The United States
International Trade Commission Proceeding (the "ITC Proceeding") (Investigation
No. 337-TA-352) was filed by Intel on May 7, 1993, against two respondents,
Twinhead International and its U.S. subsidiary, Twinhead Corporation. Twinhead
is a Taiwan-based manufacturer which is a customer of both AMD and Intel.
Twinhead purchases microprocessors from AMD and Intel, and incorporates these
microprocessors into computers sold by Twinhead. Intel claimed that the
respondents induce computer end-users to infringe the Crawford '338 patent when
the computers containing AMD microprocessors are used with multi-tasking
software such as Windows, UNIX or OS/2. Intel was seeking a permanent exclusion
order from entry into the United States of certain Twinhead personal computers
and an order directing Twinhead to cease and desist from demonstrating, testing
or otherwise using such computers in the United States. AMD intervened in the
ITC Proceeding as a real party in interest. Pursuant to the settlement AMD and
its customers will have a license under the Crawford '338 patent, which, insofar
as AMD and its products are concerned, eliminates the basis on which Intel
sought relief against the respondents in the ITC Proceeding.

3. In Re AMD Securities Litigation. Between September 8 and
September 10, 1993, five class actions were filed, purportedly on behalf of
purchasers of the Corporation's stock, alleging that the Corporation and various
of its officers and directors violated Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, 15 U.S.C. ((S))((S)) 78j(b) and 78t(a),
respectively, and Rule 10b-5 promulgated thereunder, 17 C.F.R. ((S)) 240.10b-5,
by issuing allegedly false and misleading statements about the Corporation's
development of its 486SX personal computer microprocessor products, and the
extent to which that development process included access to Intel's 386
microcode. Some or all of the complaints alleged that the Corporation's conduct
also constituted fraud, negligent misrepresentations and violations of the
California Corporations Code.

The class actions have been settled and dismissed with prejudice. The
cost of the settlements was $34 million, which was recorded in 1994.

4. George A. Bilunka, et al. v. Sanders, et al. (Case No. 93-
20727JW, N.D. Cal.) On September 30, 1993, an AMD shareholder, George A.
Bilunka, purported to commence an action derivatively on the Corporation's
behalf against all of the Corporation's directors and certain of the
Corporation's officers. The Corporation was named as a nominal defendant. This
purported derivative action essentially alleged that the individual defendants
breached their fiduciary duties to the Corporation by causing, or permitting,
the Corporation to make allegedly false and misleading statements (described in

In re AMD Securities Litigation above) about the Corporation's development of
- - -------------------------------
its 486SX personal computer microprocessor products, and the extent to which
that development process included access to Intel's 386 microcode. This action
alleged that a pre-suit demand on the Corporation's Board of Directors would
have been futile because of alleged director involvement. Damages were sought
against the individual defendants in an unspecified amount.

By order of the Court, this case was consolidated for settlement
purposes with the securities class actions discussed above. The parties settled
this case for $2.25 million, payable to the Corporation by the Corporation's
directors and officers liability insurance carrier net of legal fees of
derivative plaintiff's counsel and other miscellaneous costs.

14
<PAGE>

The net payment to the Corporation will be approximately $1 million. The
derivative action has been dismissed with prejudice.

5. SEC Investigation. The Securities and Exchange Commission
("SEC") has notified the Corporation that it is conducting an informal
investigation of the Corporation regarding the Corporation's disclosures about
the development of its Am486SX products. The investigation involves, among
other things, the disclosures that were the subject of the securities class
action and derivative suit described in Item 3, Numbers 3 and 4, above. The
Corporation is cooperating fully with the SEC's requests for information. The
investigation is, however, in a preliminary stage and no assurance can be given
that the SEC will not bring an action against the Corporation or any of its
employees. There can also be no assurance that any action taken by the SEC
arising from its investigation will not have a significant adverse effect on the
Corporation.

6. Other Matters. The Corporation is a defendant or plaintiff in
various other actions which arose in the normal course of business. In the
opinion of management, the ultimate disposition of these matters will not have a
material adverse effect on the financial condition or results of operations of
the Corporation.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of security holders during the
fourth quarter of the fiscal year covered by this report.

EXECUTIVE OFFICERS OF THE REGISTRANT

<TABLE>
<CAPTION>
Held
Name Age Position Since
- - ---- --- -------- -----
<C> <C> <S> <C>
W. J. Sanders III 58 Chairman of the Board and Chief Executive Officer. 1969

Richard Previte 60 Director, President and Chief Operating Officer. 1989
Mr. Previte became Chief Operating Officer in 1989
and President in 1990. Mr. Previte was Chief Financial
Officer and Treasurer from 1969 to 1989.

Marvin D. Burkett 52 Senior Vice President, Chief Administrative Officer, 1989
Chief Financial Officer and Treasurer. Mr. Burkett was
Controller from 1972 until 1989.

Larry R. Carter* 51 Vice President and Corporate Controller. Mr. Carter was, 1992
from August 1989 until June 1992, Chief Financial Officer
of VLSI Technology, Inc. and prior to that he was Vice
President and Controller, MOS Group, at Motorola, Inc.

Eugene D. Conner 51 Senior Vice President, Operations. Mr. Conner joined the 1987
Corporation in 1969, and was elected an executive officer
in 1981.

Stanley Winvick 55 Senior Vice President, Human Resources. 1980

Stephen J. Zelencik 60 Senior Vice President and Chief Marketing Executive. 1979
Mr. Zelencik joined the Corporation in 1970.
</TABLE>

15
<PAGE>

<TABLE>
<CAPTION>
Held
Name Age Position Since
- - ---- --- -------- -----
<C> <C> <S> <C>
Thomas M. McCoy 44 Vice President, General Counsel and Secretary. Prior to 1995
joining the Corporation, Mr. McCoy was with the law firm
of O'Melveny and Myers where he had been a partner
since 1985.
</TABLE>
______________
* Mr. Carter left the Corporation's employ following the end of the fiscal year.

There is no family relationship between any executive officers of the
Corporation.

16
<PAGE>

PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER
MATTERS

The information regarding market price range, dividend information and
number of holders of Common Stock of AMD appearing under the caption
"Supplemental Financial Data" on page 26 of the Corporation's 1994 Annual
Report to Stockholders is incorporated herein by reference.

In February 1990, the Corporation adopted a shareholder rights plan. In
accordance with this plan, the Corporation paid a dividend of one preferred
stock purchase right on each outstanding share of Common Stock pursuant to a
Rights Agreement. Each right entitles the registered holder to purchase from the
Corporation one-thousandth of a share of Series A Junior Participating Preferred
Stock, $0.10 par value, for a price of $65.00, subject to adjustment. The rights
are redeemable by the Corporation and expire on December 31, 2000. At a meeting
on February 16, 1995, the Board of Directors authorized and directed a committee
of its members to cause the Corporation to redeem the preferred stock purchase
rights at a time to be determined by the committee, subject to the right of the
committee to request that the Board reconsider its action should a change in
circumstances occur. No decision concerning the date of the planned redemption
has been announced by the Corporation.

ITEM 6. SELECTED FINANCIAL DATA

The information regarding selected financial data for the fiscal years 1990
through 1994 under the caption "Financial Summary" on page 27 of the
Corporation's 1994 Annual Report to Stockholders is incorporated herein by
reference.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION

The information appearing under the caption "Management's Discussion and
Analysis of Results of Operations and Financial Condition" on pages 7 through
10 of the Corporation's 1994 Annual Report to Stockholders is incorporated
herein by reference.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

AMD's consolidated financial statements at December 26, 1993, and December
25, 1994 and for each of the three fiscal years in the period ended December 25,
1994, and the report of independent auditors thereon, and the unaudited
quarterly financial data of AMD for the two-year period ended December 25, 1994,
on pages 11 through 26 of the Corporation's 1994 Annual Report to Stockholders
are incorporated herein by reference.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

Not applicable.

17
<PAGE>

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The information appearing at the end of Part I under the caption "Executive
Officers of the Registrant" and under the captions "Proposal No. 1-Election of
Directors" and "Compliance with Section 16(a) of the Securities Exchange Act of
1934" in the Corporation's Proxy Statement to be mailed to Stockholders on
approximately March 31, 1995, is incorporated herein by reference.

ITEM 11. EXECUTIVE COMPENSATION

The information under the paragraphs entitled "Directors Fees and Expenses"
under the caption "Committees and Meetings of the Board of Directors," and the
information under the captions "Executive Compensation" (not including the
performance graph), "Material Compensation Agreements," "Change in Control
Arrangements" and "Compensation Committee Interlocks and Insider Participation"
in the Corporation's Proxy Statement to be mailed to Stockholders on
approximately March 31, 1995, is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information appearing under the captions "Principal Stockholders" and
"Stock Ownership Table" in the Corporation's Proxy Statement to be mailed to
Stockholders on approximately March 31, 1995 is incorporated herein by
reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information appearing under the caption "Transactions with Management"
in the Corporation's Proxy Statement to be mailed to Stockholders on
approximately March 31, 1995 is incorporated herein by reference.

18
<PAGE>

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)
1. FINANCIAL STATEMENTS

The financial statements listed in the accompanying Index to Consolidated
Financial Statements and Financial Statement Schedules Covered by Report of
Independent Auditors are filed or incorporated by reference as part of this
annual report. The following is a list of such Financial Statements:
<TABLE>
<CAPTION>
PAGE REFERENCES
------------------------
1994 ANNUAL
FORM REPORT TO
10-K STOCKHOLDERS
-------- -------------
<S> <C> <C>
Report of Ernst & Young LLP, Independent Auditors -- 25
Consolidated Statements of Income for each of the three
fiscal years in the period ended December 25, 1994 -- 11
Consolidated Balance Sheets at December 26, 1993 and
December 25, 1994 -- 12
Consolidated Statements of Cash Flows for each of the three
fiscal years in the period ended December 25, 1994 -- 13
Notes to consolidated financial statements -- 14
Supplementary financial data:
Fiscal years 1993 and 1994 by quarter (unaudited) -- 26
</TABLE>

2. FINANCIAL STATEMENT SCHEDULES

The financial statement schedules listed in the accompanying Index to
Consolidated Financial Statements and Financial Statement Schedules Covered by
Reports of Independent Auditors are filed or incorporated by reference as part
of this annual report. The following is a list of such Financial Statement
Schedules:
<TABLE>
<CAPTION>
PAGE REFERENCES
------------------------
1994 ANNUAL
FORM REPORT TO
10-K STOCKHOLDERS
-------- -------------
<S> <C> <C>
VIII Valuation and qualifying accounts F-3 --
</TABLE>

All other schedules have been omitted since the required information is not
present or is not present in amounts sufficient to require submission of the
schedules, or because the information required is included in the consolidated
financial statements or notes thereto. With the exception of the information
incorporated by reference into Parts I, II and IV of this Form 10-K, the 1994
Annual Report to Stockholders is not to be deemed filed as part of this report.

19
<PAGE>

3. EXHIBITS

The exhibits listed in the accompanying Index to Exhibits are filed or
incorporated by reference as part of this annual report. The following is a
list of such Exhibits:

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- - ------ -----------------------
<C> <S>
3.1 Certificate of Incorporation, as amended, filed as Exhibit 3.1 to
the Corporation's Annual Report on Form 10-K for the fiscal period
ended December 27, 1987, is hereby incorporated by reference.

3.2 Certificate of Designations for Convertible Exchangeable Preferred
Shares, filed as Exhibit 3.2 to the Corporation's Annual Report on
Form 10-K for the fiscal year ended March 27, 1987, is hereby
incorporated by reference.

3.3 Certificate of Designations for Series A Junior Participating
Preferred Stock, filed as Exhibit 3.3 to the Corporation's Annual
Report on Form 10-K for the fiscal year ended December 31, 1989, is
hereby incorporated by reference.

3.4 By-Laws, as amended, filed as Exhibit 4.5 to the Corporation's
Registration Statement on Form S-3 (Registration No. 33-57653), are
hereby incorporated by reference.

4.1 Deposit Agreement with respect to the $30 Convertible Exchangeable
Preferred Shares, filed as Exhibit 4.3 to the Corporation's Annual
Report on Form 10-K for the fiscal year ended March 29, 1987, is
hereby incorporated by reference.

4.2 Indenture with respect to the 6% Convertible Subordinated
Debentures due in 2012, filed as Exhibit 4.4 to the Corporation's
Annual Report on Form 10-K for the fiscal year ended March 29,
1987, is hereby incorporated by reference.

4.3 The Corporation hereby agrees to file on request of the Commission
a copy of all instruments not otherwise filed with respect to long-
term debt of the Corporation or any of its subsidiaries for which
the total amount of securities authorized under such instruments
does not exceed 10% of the total assets of the Corporation and its
subsidiaries on a consolidated basis.

4.4 Rights Agreement between the Corporation and Bank of America N.T. &
S.A., filed as Exhibit 4.1 to the Corporation's Current Report on
Form 8-K dated February 7, 1990, is hereby incorporated by
reference.

*10.1 AMD 1982 Stock Option Plan, as amended, filed as Exhibit 10.1 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 26, 1993, is hereby incorporated by reference.

*10.2 AMD 1986 Stock Option Plan, as amended, filed as Exhibit 10.2 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 26, 1993, is hereby incorporated by reference.
</TABLE>

20
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- - ------ -----------------------
<C> <S>
*10.3 AMD 1992 Stock Incentive Plan, as amended, filed as Exhibit 10.3 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 26, 1993, is hereby incorporated by reference.

*10.4 AMD 1980 Stock Appreciation Rights Plan, as amended, filed as
Exhibit 10.4 to the Corporation's Annual Report on Form 10-K for
the fiscal year ended December 26, 1993, is hereby incorporated by
reference.

*10.5 AMD 1986 Stock Appreciation Rights Plan, as amended, filed as
Exhibit 10.5 to the Corporation's Annual Report on Form 10-K for
the fiscal year ended December 26, 1993, is hereby incorporated by
reference.

*10.6 MMI 1975 Stock Option Plan, as amended, filed as Exhibit 10.6 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 29, 1991, is hereby incorporated by reference.

*10.7 MMI 1981 Incentive Stock Option Plan, as amended, filed as Exhibit
10.7 to the Corporation's Annual Report on Form 10-K for the fiscal
year ended December 26, 1993, is hereby incorporated by reference.

*10.8 Forms of Stock Option Agreements, filed as Exhibit 10.8 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
December 29, 1991, are hereby incorporated by reference.

*10.9 Form of Limited Stock Appreciation Rights Agreement, filed as
Exhibit 4.11 to the Corporation's Registration Statement on Form S-
8 (No. 33-26266), is hereby incorporated by reference.

*10.10 AMD 1987 Restricted Stock Award Plan, as amended, filed as Exhibit
10.10 to the Corporation's Annual Report on Form 10-K for the
fiscal year ended December 26, 1993, is hereby incorporated by
reference.

*10.11 Forms of Restricted Stock Agreements, filed as Exhibit 10.11 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
December 29, 1991, is hereby incorporated by reference.

*10.12 Resolution of Board of Directors on September 9, 1981, regarding
acceleration of vesting of all outstanding stock options and
associated limited stock appreciation rights held by officers under
certain circumstances, filed as Exhibit 10.10 to the Corporation's
Annual Report on Form 10-K for the fiscal year ended March 31,
1985, is hereby incorporated by reference.

*10.13(a) Employment Agreement dated July 1, 1991, between the Corporation
and W. J. Sanders III, filed as Exhibit 10.1 to the Corporation's
Form 8-K dated September 3, 1991, is hereby incorporated by
reference.

*10.13(b) Amendment dated August 27, 1991, to Employment Agreement between
the Corporation and W. J. Sanders III, filed as Exhibit 10.2 to the
Corporation's Form 8-K dated September 3, 1991, is hereby
incorporated by reference.
</TABLE>
21
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- - ------ -----------------------
<C> <S>
*10.14 Management Continuity Agreement between the Corporation and W. J.
Sanders III, filed as Exhibit 10.14 to the Corporation's Annual
Report on Form 10-K for the fiscal year ended December 29, 1991, is
hereby incorporated by reference.

*10.15 Bonus Agreement between the Corporation and Richard Previte, filed
as Exhibit 10.15 to the Corporation's Annual Report on Form 10-K
for the fiscal year ended December 29, 1991, is hereby incorporated
by reference.

*10.16 Executive Bonus Plan, as amended.

*10.17(a) Bonus Agreement between the Corporation and Anthony B. Holbrook,
filed as Exhibit 10.17 for the fiscal year ended December 27, 1992,
is hereby incorporated by reference.

*10.17(b) Letter Agreement between the Corporation and Anthony B. Holbrook
dated August 24, 1994.

*10.18 Form of Bonus Deferral Agreement, filed as Exhibit 10.12 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
March 30, 1986, is hereby incorporated by reference.

*10.19 Form of Executive Deferral Agreement, filed as Exhibit 10.17 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
December 31, 1989, is hereby incorporated by reference.

*10.20 Director Deferral Agreement of R. Gene Brown, filed as Exhibit
10.18 to the Corporation's Annual Report on Form 10-K for the
fiscal year ended December 31, 1989, is hereby incorporated by
reference.

10.21 License Agreement with Western Electric Company, Incorporated,
filed as Exhibit 10.5 to the Corporation's Annual Report on
Form 10-K for the fiscal year ended 1979, is hereby incorporated by
reference.

10.22 Intellectual Property Agreements with Intel Corporation, filed as
Exhibit 10.21 to the Corporation's Annual Report on Form 10-K for
the fiscal year ended December 29, 1991, are hereby incorporated by
reference.

10.23 Award of Arbitrator in Case No. 626879 between the Corporation and
Intel Corporation, filed as Exhibit 28.2 on Form 8-K dated February
24, 1992, is hereby incorporated by reference.

*10.24 Form of Indemnification Agreements with former officers of
Monolithic Memories, Inc., filed as Exhibit 10.22 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
December 27, 1987, is hereby incorporated by reference.

10.25 Agreement and Plan of Reorganization between Monolithic Memories
Inc., the Corporation and Advanced Micro Devices Merger
Corporation, filed as Annex A to the Corporation's Amendment No. 1
to Registration Statement on Form S-4 (No. 33-15015), dated June
25, 1987, is hereby incorporated by reference.
</TABLE>

22
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- - ------ -----------------------
<C> <S>
*10.26 Form of Management Continuity Agreement, filed as Exhibit 10.25 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 29, 1991, is hereby incorporated by reference.

**10.27(a) Joint Venture Agreement between the Corporation and Fujitsu
Limited, filed as Exhibit 10.27(a) to the Corporation's Amendment
No. 1 to its Annual Report on Form 10K/A for the fiscal year ended
December 26, 1993, is hereby incorporated by reference.

**10.27(b) Technology Cross-License Agreement between the Corporation and
Fujitsu Limited, filed as Exhibit 10.27(b) to the Corporation's
Amendment No. 1 to its Annual Report on Form 10K/A for the fiscal
year ended December 26, 1993, is hereby incorporated by reference.

**10.27(c) AMD Investment Agreement between the Corporation and Fujitsu
Limited, filed as Exhibit 10.27(c) to the Corporation's Amendment
No. 1 to its Annual Report on Form 10K/A for the fiscal year ended
December 26, 1993, is hereby incorporated by reference.

**10.27(d) Fujitsu Investment Agreement between the Corporation and Fujitsu
Limited, filed as Exhibit 10.27(d) to the Corporation's Amendment
No. 1 to its Annual Report on Form 10K/A for the fiscal year ended
December 26, 1993, is hereby incorporated by reference.

**10.27(e) Joint Venture License Agreement between the Corporation and Fujitsu
Limited, filed as Exhibit 10.27(e) to the Corporation's Amendment
No. 1 to its Annual Report on Form 10K/A for the fiscal year ended
December 26, 1993, is hereby incorporated by reference.

**10.27(f) Joint Development Agreement between the Corporation and Fujitsu
Limited, filed as Exhibit 10.27(f) to the Corporation's Amendment
No. 1 to its Annual Report on Form 10K/A for the fiscal year ended
December 26, 1993, is hereby incorporated by reference.

10.28 Credit Agreement dated as of September 21, 1994, among the
Corporation, Bank of America National Trust and Savings Association
as Agent, The First National Bank of Boston as Co-Agent, filed as
Exhibit 10.1 to the Corporation's Quarterly Report on Form 10-Q for
the period ended September 25, 1994, is hereby incorporated by
reference.

10.29(a) Amended and Restated Guaranty dated as of December 17, 1993, by the
Corporation in favor of CIBC Inc.

10.29(b) First Amendment to Amended and Restated Guaranty, dated September
21, 1994, by and between the Corporation and CIBC Inc.

10.29(c) Building Lease by and between CIBC Inc. and AMD International Sales
& Service, Ltd. dated as of September 22, 1992, filed as Exhibit
10.28(b) to the Corporation's Annual Report on Form 10-K for the
fiscal year ended December 27, 1992, is hereby incorporated by
reference.
</TABLE>

23
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- - ------ -----------------------
<C> <S>
10.29(d) First Amendment to Building Lease dated December 22, 1992, by and
between CIBC Inc. and AMD International Sales & Service, Ltd.,
filed as Exhibit 10.28(c) to the Corporation's Annual Report on
Form 10-K for the fiscal year ended December 27, 1992, is hereby
incorporated by reference.

10.29(e) Second Amendment to Building Lease dated December 17, 1993, by and
between CIBC Inc. and AMD International Sales & Service, Ltd.

10.29(f) Land Lease by and between CIBC Inc. and AMD International Sales &
Service, Ltd. dated as of September 22, 1992, filed as Exhibit
10.28(d) to the Corporation's Annual Report on Form 10-K for the
fiscal year ended December 27, 1992, is hereby incorporated by
reference.

10.29(g) First Amendment to Land Lease dated December 22, 1992, by and
between CIBC Inc. and AMD International Sales & Service, Ltd.,
filed as Exhibit 10.28(e) to the Corporation's Annual Report on
Form 10-K for the fiscal year ended December 27, 1992, is hereby
incorporated by reference.

10.29(h) Second Amendment to Land Lease dated December 17, 1993, by and
between CIBC Inc. and AMD International Sales & Service, Ltd.

*10.30 Executive Savings Plan, as amended.

*10.31 Form of Split Dollar Agreement, as amended.

*10.32 Form of Collateral Security Assignment Agreement, filed as Exhibit
10.32 to the Corporation's Annual Report on Form 10-K for the
fiscal year ended December 26, 1993, is hereby incorporated by
reference.

*10.33 Forms of Stock Option Agreements to the 1992 Stock Incentive Plan,
filed as Exhibit 4.3 to the Corporation's Registration Statement on
Form S-8 (No. 33-46577), is hereby incorporated by reference.

*10.34 1992 United Kingdom Share Option Scheme, filed as Exhibit 4.2 to
the Corporation's Registration on Form S-8 (No. 33-46577), is
hereby incorporated by reference.

***10.35 Compaq Computer Corporation/AMD, Inc. Agreement.

***10.36 Foundry Agreement between the Corporation and Digital Equipment
Corporation.

***10.37 Foundry Agreement between the Corporation and Taiwan Semiconductor
Manufacturing Corporation, Ltd.

*10.38 Form of Indemnification Agreements with current officers and
directors of the Corporation.

10.39 Term Loan Agreement dated as of January 5, 1995, among the
Corporation, ABN AMRO Bank, N.V. as Administrative Agent, and ABN
AMRO Bank N.V. and CIBC Inc., as Co-Arrangers.

11 Statement re computation of per share earnings.
</TABLE>

24
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- - ------ -----------------------
<C> <S>
13. Selected portions of 1994 Annual Report to Stockholders, which has
been incorporated by reference into Parts I, II and IV of this
annual report. To the extent filed, refer to the front page
hereinabove.

21. List of AMD subsidiaries.

23. Consent of Ernst & Young LLP, Independent Auditors, refer to
page F-2 herein.

24. Power of Attorney.

27.1 Financial Data Schedule

99.1 Findings of Fact and Conclusions of Law following "ICE" module of
trial dated October 7, 1994, in Intel v. AMD, Inc., Case No. C-93-
------------------
20301 PVT United States District Court, Northern District of
California, San Jose Division, filed as Exhibit 99.1 to the
Corporation's Quarterly Report in Form 10-Q, for the period ended
September 25, 1994, is hereby incorporated by reference.

99.2 Stipulated Preliminary Injunction dated October 31, 1994, in Intel
Corporation v. AMD, Inc., Case No. C-93-20301 PVT United States
------------------------
District Court, Northern District of California, San Jose Division,
filed as Exhibit 99.2 to the Corporation's Quarterly Report on Form
10-Q, for the period ended September 25, 1994, is hereby
incorporated by reference.
</TABLE>

The Corporation will furnish a copy of any exhibit on request and payment
of the Corporation's reasonable expenses of furnishing such exhibit.

* Management contracts and compensatory plans or arrangements
required to be filed as an Exhibit to comply with Item 14(a)(3).

** Confidential treatment has been granted as to certain portions of
these Exhibits.

*** Confidential treatment has been requested as to certain portions of
these Exhibits.

(B) REPORTS ON FORM 8-K.

1. A current Report on Form 8-K dated December 30, 1994, was filed announcing
developments in the AMD/Intel Technology Agreement Arbitration, the settlement
of the AMD/Intel Litigations, and the restatement of earnings.

2. A current Report on Form 8-K dated February 10, 1995, was filed announcing
that the Convertible Exchangeable Preferred Stock of the Corporation was called
for redemption.

25
<PAGE>

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

ADVANCED MICRO DEVICES, INC.
Registrant

March 3, 1995

By:/s/ Marvin D. Burkett
Marvin D. Burkett
Senior Vice President, Chief
Administrative Officer; Chief
Financial Officer and Treasurer

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons, on behalf of the
registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>

SIGNATURE TITLE DATE
- - -------------------------- ------------------------------- -------------
<C> <S> <C>

/s/W. J. SANDERS III* Chairman of the Board and Chief March 3, 1995
(W. J. Sanders III) Executive Officer
(Principal Executive Officer)

/s/ANTHONY B. HOLBROOK* Vice Chairman of the Board March 3, 1995
(Anthony B. Holbrook)

/s/RICHARD PREVITE* Director, President and Chief March 3, 1995
(Richard Previte) Operating Officer

/s/FRIEDRICH BAUR* Director March 3, 1995
(Friedrich Baur)

/s/CHARLES M. BLALACK* Director March 3, 1995
(Charles M. Blalack)

/s/R. GENE BROWN* Director March 3, 1995
(R. Gene Brown)

/s/JOE L. ROBY* Director March 3, 1995
(Joe L. Roby)

/s/LEONARD SILVERMAN* Director March 3, 1995
(Leonard Silverman)

/s/MARVIN D. BURKETT Senior Vice President, March 3, 1995
(Marvin D. Burkett) Chief Administrative Officer;
Chief Financial Officer and
Treasurer (Principal Accounting
and Financial Officer)
</TABLE>

* By:/s/MARVIN D. BURKETT
(Marvin D. Burkett, Attorney-in-Fact)

26
<PAGE>

ADVANCED MICRO DEVICES, INC.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULES
COVERED BY REPORTS OF INDEPENDENT AUDITORS

ITEM 14(a)(1) AND (2)

The information under the following captions, which is included in the
Corporation's 1994 Annual Report to Stockholders, a copy of which is attached
hereto as Exhibit 13, is incorporated herein by reference:
<TABLE>
<CAPTION>

PAGE REFERENCES
---------------------
1994
ANNUAL
FORM REPORT TO
10-K STOCKHOLDERS
------ ------------
<S> <C> <C>
Report of Ernst & Young LLP, Independent Auditors -- 25
Consolidated Statements of Income for each of
the three fiscal years in the period ended
December 25, 1994 -- 11
Consolidated Balance Sheets at December 26, 1993
and December 25, 1994 -- 12
Consolidated Statements of Cash Flows for each of
the three fiscal years in the period ended
December 25, 1994 -- 13
Notes to consolidated financial statements -- 14
Supplementary financial data:
Fiscal years 1993 and 1994 by quarter (unaudited) -- 26

Schedules for each of the three fiscal years in the
period ended December 25, 1994:
VIII Valuation and qualifying accounts F-3 --
</TABLE>

F1
<PAGE>

CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

We consent to the incorporation by reference in this Annual Report (Form 10-K)
of Advanced Micro Devices, Inc. of our report dated January 5, 1995, except for
the first paragraph of Note 14, as to which the date is January 11, 1995;
the fourth paragraph of Note 5, as to which the date is February 10, 1995;
and the fourth paragraph of Note 6, as to which the date is February 16, 1995,
included in the 1994 Annual Report to Stockholders of Advanced Micro Devices,
Inc.

Our audits also included the financial statement schedule of Advanced Micro
Devices, Inc. listed in Item 14(a). This schedule is the responsibility of the
Corporation's management. Our responsibility is to express an opinion based on
our audits. In our opinion, the financial statement schedule referred to above,
when considered in relation to the basic financial statements taken as a whole,
presents fairly in all material respects the information set forth therein.

We also consent to the incorporation by reference in the Registration Statement
on Form S-3 (No. 33-12011) pertaining to Depositary Convertible Exchangeable
Preferred Shares, in the Registration Statement on Form S-4 (No. 33-15015)
pertaining to shares issued in connection with the acquisition of Monolithic
Memories, Inc. (MMI), in the Registration Statement on Form S-8 (No. 33-16060)
pertaining to options granted under the MMI stock option plans, in the
Registration Statement on Form S-8 (No. 33-16095) pertaining to the 1987
Restricted Stock Award Plan of Advanced Micro Devices, Inc., in the Registration
Statement on Form S-8 (No. 33-39747) pertaining to the 1991 Stock Purchase Plan
of Advanced Micro Devices, Inc., in the Registration Statements on Form S-8
(Nos. 2-70376, 2-80148, 2-93392, 33-10319, 33-26266, 33-36596 and 33-46578)
pertaining to the Stock Option and Stock Appreciation Rights Plans of the
Corporation, in the Registration Statements on Form S-8 (Nos. 33-46577 and 33-
55107) pertaining to the 1992 Stock Incentive Plan of Advanced Micro Devices,
Inc., in the Registration Statement on Form S-3 (No. 33-52943) pertaining to up
to $400,000,000 in the aggregate of debt securities, preferred stock, depositary
shares evidencing fractions of preferred shares, common stock and warrants to
purchase common stock and in the Registration Statement on Form S-3 (No.
33-57653) pertaining to the call for redemption of its Convertible Exchangeable
Preferred Stock and in the related prospectuses, of our report dated January 5,
1995, except for the first paragraph of Note 14, as to which the date is January
11, 1995; the fourth paragraph of Note 5, as to which the date is February
10, 1995; and the fourth paragraph of Note 6, as to which the date is February
16, 1995, with respect to the consolidated financial statements incorporated
herein by reference, and our report included in the preceding paragraph with
respect to the consolidated financial statement schedule included in this Annual
Report (Form 10-K) of Advanced Micro Devices, Inc.

ERNST & YOUNG LLP

March 6, 1995
San Jose, California

F2
<PAGE>
Schedule VIII

ADVANCED MICRO DEVICES, INC.

VALUATION AND QUALIFYING ACCOUNTS

Years Ended December 27, 1992, December 26, 1993 and December 25, 1994
(Thousands)
<TABLE>
<CAPTION>

Additions
Charged
Balance (Reductions Balance
Beginning Credited) End of
of Period to Operations Deductions(1) Period
--------- ------------- ------------- -------
<S> <C> <C> <C> <C>
Allowance for doubtful accounts:

Years ended:

December 27, 1992 $6,487 $ 986 $(794) $ 6,679
December 26, 1993 6,679 1,540 (727) 7,492
December 25, 1994 7,492 3,723 (896) 10,319
- - -----------
</TABLE>
(1) Accounts (written off) recovered, net.

F3
<PAGE>

ADVANCED MICRO DEVICES, INC.

INDEX TO EXHIBITS
(ITEM 14(a)(3))

<TABLE>
<CAPTION>
Exhibit
Number Description
- - ------ -----------
<C> <S>
3.1 Certificate of Incorporation, as amended, filed as Exhibit 3.1 to
the Corporation's Annual Report on Form 10-K for the fiscal period
ended December 27, 1987, is hereby incorporated by reference.

3.4 By-Laws, as amended, filed as Exhibit 4.5 to the Corporation's
Registration Statement on Form S-3 (Registration No. 33-57653), are
hereby incorporated by reference.

*10.1 AMD 1982 Stock Option Plan, as amended , filed as Exhibit 10.1 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 26, 1993, is hereby incorporated by reference.

*10.2 AMD 1986 Stock Option Plan, as amended , filed as Exhibit 10.2 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 26, 1993, is hereby incorporated by reference.
</TABLE>
30
<PAGE>

<TABLE>
<CAPTION>
Exhibit
Number Description
- - ------ -----------
<C> <S>
*10.3 AMD 1992 Stock Incentive Plan, as amended , filed as Exhibit 10.3
to the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 26, 1993, is hereby incorporated by reference.

*10.4 AMD 1980 Stock Appreciation Rights Plan, as amended , filed as
Exhibit 10.4 to the Corporation's Annual Report on Form 10-K for
the fiscal year ended December 26, 1993, is hereby incorporated by
reference.

*10.5 AMD 1986 Stock Appreciation Rights Plan , filed as Exhibit 10.5 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 26, 1993, is hereby incorporated by reference.

*10.6 MMI 1975 Stock Option Plan, as amended, filed as Exhibit 10.6 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 29, 1991, is hereby incorporated by reference.

*10.7 MMI 1981 Incentive Stock Option Plan, as amended , filed as Exhibit
10.7 to the Corporation's Annual Report on Form 10-K for the fiscal
year ended December 26, 1993, is hereby incorporated by reference.

*10.8 Forms of Stock Option Agreements, filed as Exhibit 10.8 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
December 29, 1991, are hereby incorporated by reference.

*10.9 Form of Limited Stock Appreciation Rights Agreement, filed as
Exhibit 4.11 to the Corporation's Registration Statement on Form S-
8 (No. 33-26266), is hereby incorporated by reference.

*10.10 AMD 1987 Restricted Stock Award Plan, as amended , filed as Exhibit
10.10 to the Corporation's Annual Report on Form 10-K for the
fiscal year ended December 26, 1993, is hereby incorporated by
reference.

*10.11 Forms of Restricted Stock Agreements, filed as Exhibit 10.11 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
December 29, 1991, is hereby incorporated by reference.

<TABLE>
<CAPTION>
Exhibit
Number Description
- - ------ -----------
<C> <S>
*10.14 Management Continuity Agreement between the Corporation and W. J.
Sanders III, filed as Exhibit 10.14 to the Corporation's Annual
Report on Form 10-K for the fiscal year ended December 29, 1991, is
hereby incorporated by reference .

*10.16 Executive Bonus Plan, as amended.

*10.17(a) Bonus Agreement between the Corporation and Anthony B. Holbrook,
filed as Exhibit 10.17 for the fiscal year ended December 27, 1992,
is hereby incorporated by reference.

*10.17(b) Letter Agreement between the Corporation and Anthony B. Holbrook
dated August 24, 1994.

*10.18 Form of Bonus Deferral Agreement, filed as Exhibit 10.12 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
March 30, 1986, is hereby incorporated by reference.

*10.19 Form of Executive Deferral Agreement, filed as Exhibit 10.17 to the
Corporation's Annual Report on Form 10-K for the fiscal year ended
December 31, 1989, is hereby incorporated by reference.

*10.21 License Agreement with Western Electric Company, Incorporated,
filed as Exhibit 10.5 to the Corporation's Annual Report on Form
10-K for fiscal the year ended 1979, is hereby incorporated by
reference.

10.23 Award of Arbitrator in Case No. 626879 between the Corporation and
Intel Corporation, filed as Exhibit 28.2 on Form 8-K dated February
24, 1992, is hereby incorporated by reference.

<TABLE>
<CAPTION>
Exhibit
Number Description
- - ------ -----------
<C> <S>
*10.26 Form of Management Continuity Agreement, filed as Exhibit 10.25 to
the Corporation's Annual Report on Form 10-K for the fiscal year
ended December 29, 1991, is hereby incorporated by reference.

10.29(a) Amended and Restated Guaranty dated as of December 17, 1993, by the
Corporation, in favor of CIBC Inc.

10.29(b) First Amendment to Amended and Restated Guaranty, dated September
21, 1994, by and between the Corporation and CIBC Inc.

<TABLE>
<CAPTION>
Exhibit
Number Description
- - ------ -----------
<C> <S>
10.29(d) First Amendment to Building Lease dated December 22, 1992, by and
between CIBC Inc. and AMD International Sales & Service, Ltd.,
filed as Exhibit 10.28(c) to the Corporation's Annual Report on
Form 10-K for the fiscal year ended December 27, 1992, is hereby
incorporated by reference.

10.29(e) Second Amendment to Building Lease dated December 17, 1993, by
and between CIBC Inc. and AMD International Sales & Service, Ltd.

10.29(h) Second Amendment to Land Lease dated December 17, 1993, by and
between CIBC Inc. and AMD International Sales & Service, Ltd.

*10.30 Executive Savings Plan, as amended.

*10.31 Form of Split Dollar Agreement, as amended.

*10.32 Form of Collateral Security Assignment Agreement, filed as Exhibit
10.32 to the Corporation's Annual Report on Form 10K for the fiscal
year ended December 26, 1993, is hereby incorporated by reference.

*10.34 1992 United Kingdom Share Option Scheme, Filed as Exhibit 4.2 to
the Corporation's Registration on Form S-8 (No. 33-46577), is
hereby incorporated by reference.

***10.35 Compaq Computer Corporation/AMD, Inc. Agreement.

***10.36 Foundry Agreement between the Corporation and Digital Equipment
Corporation.

***10.37 Foundry Agreement between the Corporation and Taiwan Semiconductor
Manufacturing Corporation, Ltd.

*10.38 Form of Indemnification Agreements with current officers and
directors of the Corporation.

10.39 Term Loan Agreement dated as of January 5, 1995, among the
Corporation, ABN AMRO Bank N.V. as Administrative Agent, and ABN
AMRO Bank N.V. and CIBC, Inc. as Co-Arrangers.

11. Statement re computation of per share earnings.

</TABLE>
34
<PAGE>

<TABLE>
<CAPTION>
Exhibit
Number Description
- - ------ -----------
<C> <S>
13. Selected portions of 1994 Annual Report to Stockholders which has
been incorporated by reference into Parts I, II and IV of this
annual report. To the extent filed, refer to the front page
hereinabove.

21. List of AMD subsidiaries.

23. Consent of Ernst & Young LLP, Independent Auditors, refer to page
F-2 hereinabove.

24. Power of Attorney.

27.1 Financial Data Schedule

99.1 Findings of Fact and Conclusions of Law following "ICE" module of
trial dated October 7, 1994, in Intel v. AMD, Inc., Case No.
------------------
C-93-20301 PVT United States District Court, Northern District of
California, San Jose Division, filed as Exhibit 99.1 to the
Corporation's Quarterly Report in Form 10-Q, for the period ended
September 25, 1994, is hereby incorporated by reference.

99.2 Stipulated Preliminary Injunction dated October 31, 1994, in Intel
-----
Corporation v. AMD, Inc., Case No. C-93-20301 PVT United States
------------------------
District Court, Northern District of California, San Jose Division,
filed as Exhibit 99.2 to the Corporation's Quarterly Report on Form
10-Q, for the period ended September 25, 1994, is hereby
incorporated by reference.
</TABLE>

The Corporation will furnish a copy of any exhibit on request and
payment of the Corporation's reasonable expenses of furnishing such exhibit.

* Management contracts and compensatory plans or arrangements required to be
filed as an Exhibit to comply with Item 14(a)(3).

** Confidential treatment has been granted as to certain portions of these
Exhibits.

*** Confidential treatment has been requested as to certain portions of these
Exhibits.

35
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.16
<SEQUENCE>2
<DESCRIPTION>EXECUTIVE BONUS PLAN, AS AMENDED.
<TEXT>

<PAGE>

EXHIBIT 10.16

ADVANCED MICRO DEVICES, INC.

EXECUTIVE BONUS PLAN

Personal and Confidential
<PAGE>

AMD EXECUTIVE BONUS PLAN
================================================================================

TABLE OF CONTENTS

I. Purpose___________________________________________ 3

II. Overview__________________________________________ 3

III. Short-Term Performance Plan (STPP)________________ 4

IV. Long-Term Performance Plan (LTPP)_________________ 6

V. Timing of Payouts_________________________________ 8

VI. EBP Administration________________________________ 8

VII. Financial Terms Explained_________________________ 9
</TABLE>

- 2 -
<PAGE>

AMD EXECUTIVE BONUS PLAN
================================================================================

I. PURPOSE

The Executive Bonus Program (EBP) provides an incentive for AMD's Vice
Presidents and the Officer Staff to maximize short- and long-term financial
and sales performance.

II. OVERVIEW

o The EBP has two separate elements: the Short-Term Performance Plan
(STPP) which provides an annual incentive, and the Long-Term Performance
Plan (LTPP) which rewards sustained Corporate performance over a three-
year period.

o The STPP motivates participants to exceed Corporate Operating Income and
selected Division objectives. Executives are assigned to different tiers
of the STPP (with varying award targets and maximums) depending upon
their roles.

o The LTPP measures AMD's 3-year performance on Return on Equity (ROE) and
sales growth relative to the external marketplace.

o Expressed as percents of base salary, target and maximum awards for the
EBP are as follows:

<TABLE>
<CAPTION>
- - --------------------------------------------------------------------------------------------------

PLAN ELEMENT TARGET AWARD MAXIMUM AWARD
PERFORMANCE MEASURE (% OF BASE) (% OF BASE)
- - --------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
STPP Corporate Operating Income, 40% - 50% 80% -100%
Division Measures (may vary)
- - --------------------------------------------------------------------------------------------------
LTPP 3 Year Relative ROE & 30% 60%
Sales Growth
==================================================================================================
Total EBP 70% - 80% 140% - 160%
- - --------------------------------------------------------------------------------------------------
</TABLE>

o Calculations of STPP bonuses use the participant's annualized base
salary as of December 31 of the plan year. For LTPP bonuses, the
participant's annualized base salary as of December 31 of Plan Year 3 is
used. The base salary amount is modified subject to the proration
provisions as described in section VI., EBP Administration.

- 3 -
<PAGE>

AMD EXECUTIVE BONUS PLAN
================================================================================

o The EBP is funded by a maximum of 3 percent of AMD's reported Operating
Income.

III. SHORT TERM PERFORMANCE PLAN (STPP)

The STPP bonus is earned by achieving specific levels of Corporate
performance against reported Operating Income. In addition, a portion of
the STPP is based on the achievement of Division performance objectives as
established by the Office of the CEO.

STPP awards vary depending on actual performance against planned Operating
Income and Division objectives. Target awards are earned when planned
objectives are achieved. If Operating Income and Division performance
objectives are exceeded, then awards up to the maximum may be earned.
Conversely, in poor performance years, STPP payouts will be greatly reduced
or eliminated.

STPP PLAN PARAMETERS:

o The Corporate portion makes up a minimum of 80% of the STPP payout,
while the Division portion comprises no more than 20% of the STPP
payout.

o For any payout to occur on the Corporate portion of the STPP, the
current year's actual Operating Income must be greater than 25% of the
prior year's reported Operating Income (the "threshold"), and in no case
be less than $0. The Office of the CEO retains discretion on payouts of
the Division performance portion of the STPP.

- 4 -
<PAGE>

AMD EXECUTIVE BONUS PLAN
================================================================================

A. STPP CORPORATE PERFORMANCE CALCULATION:

First a target multiplier (ranging from 0 to 2) is calculated based on
actual Operating Income against planned Operating Income.

Then the actual STPP bonus amount for the Corporate portion of the
plan is calculated as follows:

Target Multiplier x Target % x Base Salary = STPP Corporate Bonus Award

Awards for the Corporate portion of the STPP are earned as follows:

o When actual Operating Income is equal to planned Operating Income,
the target award is generated.

o When actual Operating Income is 125% or more than planned Operating
Income, the maximum award is generated.

o When actual Operating Income is less than the threshold (or $0), no
bonus is generated.

The annual STPP threshold, Operating Income goal, and target multiplier
formulas are generated and communicated to the participants each year.

B. STPP DIVISION PERFORMANCE CALCULATION

The Division performance objectives are determined annually by the
appropriate member of the Office of the CEO. The target and maximum
payout amounts for the Division performance portion will not exceed 20%
of the total STPP bonus.

Specifics of the Division portion are communicated to participants each
year, along with the objectives for the Corporate portion of the STPP.

- 5 -
<PAGE>

AMD EXECUTIVE BONUS PLAN
================================================================================

IV. LONG-TERM PERFORMANCE PLAN (LTPP)

The LTPP has a target bonus of 30% of base salary and a maximum
opportunity of 60% for all participants. It is based on sustained
Corporate performance on both financial and sales growth measures relative
to AMD's competitive marketplace over a rolling three-year period.

The actual LTPP bonus as a percent of salary is the product of two
multipliers (the Financial Performance Multiplier and the Sales
Performance Multiplier) times the 30% target payout. The multipliers are
derived from a Financial Performance Delta and a Sales Performance Delta,
both representing comparisons against the external marketplace. Their
derivations are described as follows:

A. Financial Performance Delta is the difference between AMD's Return
on Equity, ROE (AMD), over a three-year period and the three-year
average Return on Equity for the Standard and Poor's 500, ROE (S&P),
for the same period.

The Financial Performance Delta is calculated as follows:

3-Year ROE (AMD) - 3-Year ROE (S&P) = Financial Performance Delta

Three-year ROE (AMD) is calculated by dividing AMD's total Net Income
(N.I.) earned over the three-year period (Year 1 through Year 3) by the
sum of AMD's average annual Shareholders' Equity (S.E.) over the same
period. Average annual S.E. is the simple average of the year-beginning
and year-ending S.E.

Three-year ROE (S&P) is calculated by averaging ROE reported for the S&P
500 for the period (Year 1 through Year 3):

3-Year ROE (S&P) = ROE Year 1 + ROE Year 2 + ROE Year 3
------------------------------------
3

- 6 -
<PAGE>

AMD EXECUTIVE BONUS PLAN
================================================================================

The Financial Performance Multiplier is derived from the equations shown
below.

<TABLE>
<CAPTION>
Equations
---------
<C> <S> <C> <C>
If: delta is less than -6.0 Then multiplier = 0
-6.0 is less than delta and less than or equal to 6.0 = 0.1667 x delta + 1
delta is greater than 6.0 = 2
</TABLE>

B. Sales Performance Delta is the difference between AMD's three-year sales
growth and the three-year semiconductor industry sales growth, as published
by Worldwide Semiconductor Trade Statistics (WSTS). Three-year Sales Growth
for both AMD and the semiconductor industry is determined as follows:

3-Year Sales Growth = Year 3 Sales - Year 0 Sales x 100
---------------------------
Year 0 Sales

The percentage point difference (Sales Performance Delta) between AMD Sales
Growth and WSTS Sales Growth is then computed.

When the Delta is known, the Sales Performance Multiplier is then
determined using the following equations.

<TABLE>
<CAPTION>
Equations
---------
<C> <S> <C> <C>
If: delta is less than or equal to -30.0 Then multiplier = 0
-30.0 is less than delta and less than or equal to 0.0 = 0.0333 x delta + 1
0.0 is less than delta and less than or equal to 20.0 = 0.05 x delta + 1
delta is greater than 20.0 = 2
</TABLE>

C. The Total LTPP Bonus as a percent of salary is calculated as follows:

Financial Performance Multiplier x Sales Performance Multiplier

x Target Percent = LTPP Bonus as a Percent of Salary

- 7 -
<PAGE>

AMD EXECUTIVE BONUS PLAN
================================================================================

V. TIMING OF PAYOUTS

All awards earned under the STPP and LTPP are paid out by the end of Q1,
following the close of the fiscal year.

VI. EBP ADMINISTRATION

o For the STPP, individuals who participate for less than the full plan
year (fiscal year) have their awards prorated to reflect their actual
participation period. For the LTPP, executives with less than one year
of participation are ineligible to receive an award. During subsequent
fiscal years, LTPP awards are prorated based on the actual number of
fiscal months in the plan relative to 36 months of participation,
subject to the provision below.

o Participants must be full-time, active employees at the time of the
bonus distribution to qualify for a bonus award. In case of retirement,
death, or disability, award amounts are prorated for the fiscal year
only if participants were on active employment status for less than six
months. If participants were on active status for six months or more,
they receive the payout for the whole year.

o The EBP is funded by no more than 3 percent of reported Operating
Income. If the calculated EBP payouts exceed that figure, awards are
adjusted downward to stay within this funding limit.

o There is no vested entitlement to any bonuses as described above.
Payment of any bonuses are made at the sole discretion of the Office of
the CEO.

o AMD reserves the right to modify or terminate the plan or participation
of any individual at its sole discretion.

- 8 -
<PAGE>

AMD EXECUTIVE BONUS PLAN
================================================================================

VII. FINANCIAL TERMS EXPLAINED

o Reported Operating Income is total Operating Income as reported on
external financial statements.

o Return on Equity (ROE) is calculated by dividing Net Income for the
period by average Shareholders' Equity (i.e., the average of the fiscal
year's beginning and ending Shareholders' Equity). For the purposes of
the LTPP, ROE for AMD will be calculated over a three-year period as
described in Section IV. A.

"Net Income" is income after all expenses, including those not shown on
the internal (product line) P&L. Expenses shown on the P&L are operating
expenses (the costs of operating the business), interest expenses (the
costs of financing the business), and income taxes. Besides these P&L
expenses, profit sharing, bonus accruals, and foreign exchange gain/loss
expenses are included in the calculation of Net Income. Thus, reported
Net Income is income that is available to shareholders, which the
company can pay out in dividends or reinvest on their behalf. The
denominator, Shareholder Equity, is the book value of the shareholders'
investment in the company.

o The Standard and Poor's 500 (S&P 500) is a composite of 500 companies
chosen by Standard and Poor's Corporation because they tend to be
leaders in important industries within the U.S. economy. It consists of
400 industrial, 40 financial, 40 public utilities, and 20 transportation
companies. In addition to being used to measure AMD's Financial
performance for the LTPP, the S&P 500 is the comparator group used in
analyzing AMD's performance in the annual report and proxy statement.

o Worldwide Semiconductor Trade Statistics (WSTS), Inc. collects,
consolidates and publishes data (such as shipments and bookings) on a
monthly basis from the vast majority of semiconductor companies
worldwide. WSTS data are widely accepted benchmarks for performance
throughout the industry. The data used for EBP purposes are worldwide
semiconductor sales figures.

- 9 -
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.17(B)
<SEQUENCE>3
<DESCRIPTION>LTR. AGMT. BTW. AMD AND HOLBROOK.
<TEXT>

<PAGE>

EXHIBIT 10.17(b)

August 24, 1994

Mr. Anthony B. Holbrook
41 Hollins Drive
Santa Cruz, California 95060

Dear Tony:

Although we regret your decision to resign as an executive officer of AMD,
we are very pleased that you will be available to continue to work with AMD on a
part-time basis. The following will formalize the arrangements you have
proposed in your letter to Jerry, and issues we discussed in our recent
conversation.

1) You will remain a full-time AMD employee through August 26, 1994.

2) From August 27, 1994 through July 31, 1995, you will be a regular, part-
time employee of AMD, during which you will devote up to 35 hours per month
to the activities described in this agreement. In the second quarter of
1995, we will discuss extension of this agreement.

3) During the period from August 27, 1994 through July 31, 1995, you will
oversee the K-series program by formally reviewing development status every
45 to 60 days and informally monitoring events more frequently. At the
request of individual members of senior management, you will advise on
matters such as product and market development strategies, technology
plans, business plans, and new business ventures. You will be available to
attend meetings such as division strategy reviews, PDPs, and TDPs as
requested.

4) While you remain as a part-time employee under this agreement, you will be
compensated at a bi-weekly rate of $5,592, beginning August 27, 1994. All
business expenses will be reimbursed as usual, and all applicable federal
and state taxes will be deducted.

5) AMD will provide an office and secretarial support.

6) Certain benefits, including medical, dental and life insurance benefits,
will end on August 31, 1994. Under COBRA, you will be entitled to
continued medical and dental coverage at your sole expense. Benefits under
the Executive long-term disability plan, the Executive Savings plan, and
the stock purchase plan end on your last day of full-time employment,
August 26, 1994. As a regular, part-time employee, you will continue to
vest in any unvested stock options, and will be eligible for Cash Profit
Sharing, Deferred Profit Sharing, and the 401(k) Plan.
<PAGE>

Mr. Anthony B. Holbrook
August 24, 1994
Page 2

7) You will be eligible to receive payment of your 1994 Chief Technical
Officer bonus at the time it is regularly paid.

8) You will be entitled to retain the use of an AMD vehicle under the terms
and conditions of AMD Car Plan A from August 27, 1994 through July 31,
1995, subject to the following conditions: (i) all fuel costs will be paid
by you; and (ii) you will be reimbursed up to a total of $2,000 for routine
maintenance and normal repair during this period upon presentation of
appropriate documentation. If a maintenance or repair problem in excess of
$2,000 arises, you will advise AMD and seek prior approval for
reimbursement from the Chief Financial Officer.

9) All of the company's policies and programs, including policies concerning
trading in AMD stock and the protection and ownership of intellectual
property, will continue to apply to you, and where applicable will extend
beyond termination of employment.

If the above meets with your approval, please sign the enclosed copy and
return it to me.

Sincerely,

/s/ Stanley Winvick

Stanley Winvick
Senior Vice President, Human Resources

Accepted and Agreed:

/s/ Anthony B. Holbrook
--------------------------------------
Anthony B. Holbrook

cc: Jerry Sanders

SW:JWS/kar
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.29A
<SEQUENCE>4
<DESCRIPTION>AMEND. & REST. GUARANTY DATED 12/17/93
<TEXT>

<PAGE>

EXHIBIT 10.29(a)

AMENDED AND RESTATED GUARANTY

dated as of December 17, 1993

ADVANCED MICRO DEVICES, INC.

in favor of

CIBC INC.
<PAGE>

TABLE OF CONTENTS

ARTICLE I

DEFINITIONS

<TABLE>

<C> <S> <C>
SECTION 1.1 Certain Terms . . . . . . . . . . . . . 2
SECTION 1.2 Accounting and Financial
Determinations . . . . . . . . . . . . . 9
SECTION 1.3 Definitions in the Leases . . . . . . . 9

ARTICLE II

GUARANTY PROVISIONS

SECTION 2.1 Guaranty . . . . . . . . . . . . . . . . 10
SECTION 2.2 Acceleration of Guaranty . . . . . . . 11
SECTION 2.3 Guaranty Absolute, etc. . . . . . . . . 11
SECTION 2.4 Reinstatement, etc. . . . . . . . . . . 13
SECTION 2.5 Waiver, etc. . . . . . . . . . . . . . 13
SECTION 2.6 Subrogation . . . . . . . . . . . . . . 14

ARTICLE III

REPRESENTATIONS AND WARRANTIES

SECTION 3.1 Representations and Warranties . . . . . 15
SECTION 3.1.1 Organization, etc. . . . . . . . . . . . 15
SECTION 3.1.2 Due Authorization, Non-Contravention,
etc. . . . . . . . . . . . . . . . . . . 15
SECTION 3.1.3 Government Approval, Regulation, etc. . . 16
SECTION 3.1.4 Validity, etc. . . . . . . . . . . . . . 16
SECTION 3.1.5 Financial Information . . . . . . . . . . 16
SECTION 3.1.6 No Material Adverse Change . . . . . . . 16
SECTION 3.1.7 Litigation, Labor Controversies, etc. . . 16
SECTION 3.1.8 Subsidiary . . . . . . . . . . . . . . . 17
SECTION 3.1.9 Ownership of Properties . . . . . . . . . 17
SECTION 3.1.10 Taxes . . . . . . . . . . . . . . . . . . 17
SECTION 3.1.11 Pension and Welfare Plans . . . . . . . . 17
SECTION 3.1.12 Environmental Warranties . . . . . . . . 18
SECTION 3.1.13 Regulations G, U and X . . . . . . . . . 20
SECTION 3.1.14 No Default . . . . . . . . . . . . . . . 20
SECTION 3.1.15 Representations and Warranties in the
Leases. . . . . . . . . . . . . . . . . . 20
SECTION 3.1.16 Accuracy of Information . . . . . . . . . 20
</TABLE>

i
<PAGE>

ARTICLE IV

COVENANTS, ETC.

<TABLE>
<CAPTION>
<C> <S> <C>
SECTION 4.1 Affirmative Covenants . . . . . . . . . . 21
SECTION 4.1.1 Financial Information, Reports,
Notices, etc. . . . . . . . . . . . . . . 21
SECTION 4.1.2 Compliance with Laws, etc. . . . . . . . 22
SECTION 4.1.3 Maintenance of Properties . . . . . . . . 23
SECTION 4.1.4 Insurance . . . . . . . . . . . . . . . . 23
SECTION 4.1.5 Books and Records . . . . . . . . . . . . 23
SECTION 4.1.6 Environmental Covenant . . . . . . . . . 24
SECTION 4.1.7 Maintenance of Authorizations, etc. . . . 24
SECTION 4.1.8 Performance of Obligations . . . . . . . 25
SECTION 4.1.9 Further Assurances . . . . . . . . . . . 25
SECTION 4.2 Negative Covenants . . . . . . . . . . . 25
SECTION 4.2.1 Indebtedness . . . . . . . . . . . . . . 25
SECTION 4.2.2 Liens . . . . . . . . . . . . . . . . . . 26
SECTION 4.2.3 Financial Condition . . . . . . . . . . . 27
SECTION 4.2.4 Restricted Payments, etc. . . . . . . . . 28
SECTION 4.2.5 Rental Obligations . . . . . . . . . . . 28
SECTION 4.2.6 Consolidation, Merger, etc. . . . . . . . 28
SECTION 4.2.7 Asset Dispositions, etc. . . . . . . . . 28
SECTION 4.2.8 Bankruptcy Proceedings . . . . . . . . . 29
SECTION 4.2.9 Transactions with Affiliates . . . . . . 29
SECTION 4.2.10 Negative Pledges, Restrictive
Agreements, etc. . . . . . . . . . . . . 29
SECTION 4.2.11 Fees . . . . . . . . . . . . . . . . . . 30

ARTICLE V

COLLATERAL ACCOUNT

SECTION 5.1 Deposit Events . . . . . . . . . . . . . 30
SECTION 5.2 Deposit and Applications . . . . . . . . 31

ARTICLE VI

MISCELLANEOUS PROVISIONS

SECTION 6.1 Successors, Transferees and Assigns;
Transfers of Notes, etc. . . . . . . . . 31
SECTION 6.2 Amendments, etc. . . . . . . . . . . . . 32
SECTION 6.3 Notices . . . . . . . . . . . . . . . . . 32
SECTION 6.4 No Waiver; Remedies . . . . . . . . . . . 33
SECTION 6.5 Captions . . . . . . . . . . . . . . . . 33
SECTION 6.6 Severability . . . . . . . . . . . . . . 33
SECTION 6.7 Governing Law . . . . . . . . . . . . . . 33
SECTION 6.8 Forum Selection and Consent to
Jurisdiction . . . . . . . . . . . . . . 33
SECTION 6.9 Waiver of Jury Trial . . . . . . . . . . 34
</TABLE>

ii
<PAGE>

SCHEDULE I - Real Property Description
SCHEDULE II - Environmental Matters
SCHEDULE III - Disclosure Information

iii
<PAGE>

AMENDED AND RESTATED GUARANTY
-----------------------------

THIS AMENDED AND RESTATED GUARANTY, dated as of December 17, 1993 (as
from time to time amended, supplemented, amended and restated or otherwise
modified, this "Guaranty"), made by ADVANCED MICRO DEVICES, INC., a Delaware
--------
corporation (the "Guarantor"), in favor of CIBC INC., a Delaware corporation
---------
("Lessor").
------

W I T N E S S E T H:
- - - - - - - - - -

WHEREAS, pursuant to a Land Lease dated as of September 22, 1992, as
amended by that certain First Amendment to Land Lease dated December 22, 1992
(the "Original Land Lease") between AMD International Sales & Service, Ltd., a
-------------------
Delaware corporation (the "Lessee") and Lessor, Lessor leased to Lessee the land
------
(the "Land") described at Schedule I hereto;
----

WHEREAS, pursuant to a Building Lease, dated as of September 22, 1992,
as amended by that certain First Amendment to Building Lease dated December 22,
1992 (the "Original Building Lease"), between Lessee and Lessor, Lessor leased
-----------------------
to Lessee the building and improvements located on the Land, all as more
specifically described in the Original Building Lease;

WHEREAS, pursuant to a Construction Consent Agreement between Lessor
and Lessee dated December 22, 1992 Lessor consented to Lessee making certain
Renovations (as defined below) to the Property;

WHEREAS, as a condition precedent to Lessor entering into the Original
Land Lease and the Original Building Lease, the Guarantor executed and delivered
a Guaranty dated as of September 22, 1992, which Guaranty was amended and
restated by that certain Amended and Restated Guaranty dated as of January 4,
1993 (collectively, the "Original Guaranty";
-----------------

WHEREAS, Lessor and Lessee are entering into a Second Amendment to Land
Lease dated as of the date hereof (the "Land Lease Amendment") which will amend
--------------------
the Original Land Lease to incorporate certain changes and modifications which
have been agreed to by the parties;

WHEREAS, Lessor and Lessee also are entering into a Second Amendment to
Building Lease dated as of the date hereof (the "Building Lease Amendment")
------------------------
which will amend the Original Building Lease to (i) provide that Lessor will
fund certain of the Renovations, and (ii) make certain other changes and
modifications which have been agreed to by the parties;

WHEREAS, Guarantor has acknowledged that the changes, modifications,
additions and fundings reflected in the Land Lease
<PAGE>

Amendment and Building Lease Amendment will substantially benefit both Lessee
and Guarantor;

WHEREAS, as a condition to Lessor entering into the Land Lease
Amendment and the Building Lease Amendment, Guarantor is required to deliver
this Guaranty; and

WHEREAS, Guarantor has duly authorized the execution, delivery and
performance of this Guaranty;

NOW THEREFORE, for good and valuable consideration the receipt of which
is hereby acknowledged, and in order to induce Lessor, Guarantor agrees, for the
benefit of Lessor, as follows:

THE ORIGINAL GUARANTY IS HEREBY AMENDED AND RESTATED IN ITS ENTIRETY TO READ AS
FOLLOWS:

ARTICLE I

DEFINITIONS

SECTION 1.1 Certain Terms. The following terms (whether or not
-------------
underscored) when used in this Guaranty, including its preamble and recitals,
shall have the following meanings (such definitions to be equally applicable to
the singular and plural forms thereof):

"Aggregate Balance Due" means the aggregate of the Balance Due (as that
---------------------
term is defined in the Amended Building Lease) under the Amended Building Lease
and the Balance Due (as that term is defined in the Amended Land Lease) under
the Amended Land Lease.

"Amended Building Lease" means the Original Building Lease, as amended
----------------------
by the Building Lease Amendment, together with all other amendments, supplements
and restatements and other modifications, if any, from time to time made
hereafter thereto.

"Amended Land Lease" means the Original Land Lease, as amended by the
------------------
Land Lease Amendment, together with all other amendments, supplements and
restatements and other modifications, if any, from time to time made hereafter
thereto.

"Bank of America Credit Agreement" means that certain Credit Agreement
--------------------------------
dated as of January 4, 1993, among Guarantor, Bank of America National Trust &
Savings Association, as Agent, First National Bank of Boston, as Co-Agent, and
the Banks named therein.

"Building Lease Amendment" is defined in the recitals.
------------------------ --------

2
<PAGE>

"Capitalized Lease Liabilities" means all monetary obligations under
-----------------------------
any leasing or similar arrangement which, in accordance with GAAP, would be
classified as capitalized leases, and, for purposes of this Guaranty, the amount
of such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP, and the stated maturity thereof shall be the date of the
last payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment of a
penalty.

"Cash Equivalent Investment" means any evidence of Indebtedness,
--------------------------
maturing not more than one year after such time, issued or guaranteed by the
United States Government; commercial paper, maturing not more than nine months
from the date of issue, which is issued by a corporation (other than Lessor)
organized under the laws of any state of the United States or the District of
Columbia and rated at least A-1 by Standard & Poor's Corporation or P-1 by
Moody's Investors Service, Inc. or any certificate of deposit or banker's
acceptance maturing not more than one year after such time, which is issued by a
commercial banking institution that is a member of the Federal Reserve System
and has a combined capital and surplus and undivided profits of not less
$500,000,000.

"CERCLA" means the Comprehensive Environmental Response, Compensation
------
and Liability Act of 1980, as amended.

"CERCLIS" means the Comprehensive Environmental Response Compensation
-------
Liability Information List.

"Collateral Account" is defined in Section 5.2.
------------------ -----------

"Consent Agreement" means the Construction Consent Agreement dated as
-----------------
of December 22, 1992 entered into by and between Lessor and Lessee and shall
also include the Security Agreement and Assignment and the Consents and
Acknowledgments entered into in connection with the Consent Agreement.

"Contingent Liabilities" means any agreement, undertaking or
----------------------
arrangement by which any Person guarantees, endorses or otherwise becomes or is
contingently liable upon (by direct or indirect agreement, contingent or
otherwise, to provide funds for payment, to supply funds to, or otherwise to
invest in, a debtor, or otherwise to assure a creditor against loss) the
indebtedness, obligation or any other liability of any other Person (other than
by endorsements of instruments in the course of collection), or guarantees the
payment of dividends or other distributions upon the shares of any other Person.
The amount of any Person's obligation under any Contingent Liability shall
(subject to any limitation set forth therein) be deemed to be the outstanding
principal amount (or maximum principal amount, if larger) of the debt,
obligation or other liability guaranteed thereby.

3
<PAGE>

"Controlled Group" means all members of a controlled group of
----------------
corporations and all members of a controlled group of trades or businesses
(whether or not incorporated) under common control which, together with the
Guarantor or any of its Subsidiaries, are treated as a single employer under
Section 414(b) or 414(c) of the Code or Section 4001 of ERISA.

"Debt" means the consolidated Indebtedness of Guarantor and its
----
Subsidiaries.

"Debt to Tangible Net Worth Ratio" means the ratio of
--------------------------------

(a) Debt

to
--

(b) Tangible Net Worth.

"Default" means any Event of Default or any condition, occurrence or
-------
event which, after notice or lapse of time, or both, would constitute an Event
of Default.

"Deposit Event" is defined in Section 5.1.
------------- -----------

"Earnings before Interest, Taxes and Operating Lease Payments" means,
------------------------------------------------------------
for Guarantor and its Subsidiaries, on a consolidated basis, Net Income
(exclusive of all amounts in respect of any extraordinary gains or losses) plus
----
interest expense of Guarantor and its Subsidiaries, including the portion of any
Capitalized Lease Liabilities allocable to interest expense; plus all federal,
----
state, local and foreign income taxes of Guarantor and its Subsidiaries; plus
----
all Operating Lease Payments.

"Environmental Indemnity Agreement" means the Restated Hazardous
---------------------------------
Materials Undertaking and Unsecured Indemnity dated as of the date hereof,
executed and delivered by an Authorized Officer of Lessee and Guarantor.

"Environmental Laws" means all applicable federal, state or local
------------------
statutes, laws, ordinances, codes, rules, regulations and guidelines (including
consent decrees and administrative orders) relating to public health and safety
and protection of the environment.

"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time. References
to sections of ERISA also refer to any successor sections.

"Fiscal Quarter" means any quarter of a Fiscal Year.
--------------

4
<PAGE>

"Fiscal Year" means any period of twelve consecutive calendar months
-----------
ending on the last Sunday of the calendar year; references to a Fiscal Year with
a number corresponding to any calendar year (e.g., the "1993 Fiscal Year") refer
to the Fiscal Year ending on the last Sunday occurring during such calendar
year.

"Fixed Charge Coverage Ratio" means, at any date of calculation
---------------------------
thereof, the ratio of

(a) Earnings before Interest, Taxes and Operating Lease Payments for
the immediately preceding four Fiscal Quarters (or, if shorter, the period
from the date hereof through such date of calculation)

to
--

(b) Fixed Charges of Guarantor and its Subsidiaries on a consolidated
basis for such period.

"Fixed Charges" means, relative to any Person for any period, the sum
-------------
of

(a) cash interest payable on all Indebtedness of such Person during
such period;

(b) Operating Lease Payments;

plus
----

(c) principal amounts payable during such period of all Indebtedness
of such Person resulting from the borrowing of money or the granting of
credit (other than (i) normal accounts payable representing deferred
payment obligations for goods and services provided in the ordinary course
of business on normal trade terms and (ii) Indebtedness repaid with
proceeds from additional Indebtedness permitted pursuant to Section 4.2.1).
-------------

"F.R.S. Board" means the Board of Governors of the Federal Reserve
------------
System or any successor thereto.

"GAAP" is defined in Section 1.2.
---- -----------

"Governmental Approvals" means all the authorizations, consents,
----------------------
approvals, licenses, leases, rulings, permits (including the Permits), tariffs,
rates, certifications, exemptions, filings or registrations by or with any
Governmental Authority or pursuant to any Governmental Requirement relating to
Guarantor and any of its Subsidiaries, any of the respective properties, this
Guaranty and the Leases.

5
<PAGE>

"Governmental Authority" means the government of any federal, state,
----------------------
municipal or other political subdivision (including courts, arbitration
tribunals and administrative agencies and all other agencies and
instrumentalities of such governments and political subdivisions) exercising
jurisdiction over Guarantor or any of its Subsidiaries or any of their
properties.

"Governmental Requirements" means all laws, ordinances, statutes,
-------------------------
codes, rules, regulations, treaties, rulings, decisions, policies, guidelines,
orders and decrees of any Governmental Authority.

"Guarantor" is defined in the preamble.
--------- --------

"Guaranty" is defined in the preamble.
-------- --------

"Hazardous Materials" means
-------------------

(a) any "hazardous substance", as defined by CERCLA or by Sections
25281(d) or 25316 of the California Health and Safety Code, as amended,
reformed or otherwise modified from time to time;

(b) any "hazardous waste", as defined by the Resource Conservation
and Recovery Act, as amended;

(c) any "hazardous waste", "infectious waste" or "hazardous
material" as defined in Sections 25117, 25117.5 or 25501(j) of the
California Health and Safety Code, as amended, reformed or otherwise
modified from time to time;

(d) any petroleum product; or

(e) any pollutant or contaminant or hazardous, dangerous or toxic
chemical, material or substance within the meaning of any other
Governmental Requirement (including consent decrees and administrative
orders) relating to or imposing liability or standards of conduct
concerning any hazardous, toxic or dangerous waste, substance or material,
all as amended or hereafter amended.

"Impermissible Qualification" means relative to the opinion or
---------------------------
certification of any independent public accountant as to any financial statement
of Guarantor or Lessee, any qualification or exception to such opinion or
certification

(a) which is of a "going concern" or similar nature;

(b) which relates to the limited scope of examination of matters
relevant to such financial statement; or

6
<PAGE>

(c) which relates to the treatment or classification of any item
in such financial statement and which, as a condition to its removal, would
require an adjustment to such item the effect of which would be to cause a
default to occur under Section 4.2.4.
-------------

"Indebtedness" of any Person means, without duplication:
------------

(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;

(b) all obligations, contingent or otherwise, relative to the face
amount of all letters of credit, whether or not drawn, and banker's
acceptances issued for the account of such Person;

(c) all obligations of such Person as lessee under leases which
have been or should be, in accordance with GAAP, recorded as Capitalized
Lease Liabilities;

(d) all other items which, in accordance with GAAP, would be
included as liabilities on the liability side of the balance sheet of such
Person as of the date at which Indebtedness is to be determined;

(e) whether or not so included as liabilities in accordance with
GAAP, all obligations of such Person to pay the deferred purchase price of
property or services, and indebtedness (excluding prepaid interest thereon)
secured by a Lien on property owned or being purchased by such Person
(including indebtedness arising under conditional sales or other title
retention agreements), whether or not such indebtedness shall have been
assumed by such Person or is limited in recourse;

(f) all indebtedness secured by any Lien on any property or asset
owned or held by that Person regardless of whether the indebtedness secured
thereby shall have been assumed by that Person or is nonrecourse to the
credit of that Person (but only to the extent of the lesser of (i) the
Indebtedness so secured or (ii) the fair market value of the property or
asset subject to such Lien; and

(g) all Contingent Liabilities of such Person in respect of any of
the foregoing.

For all purposes of this Agreement, the Indebtedness of any Person shall include
the Indebtedness of any partnership or joint venture in which such Person is a
general partner or a joint venturer (other than Indebtedness of a joint venture
corporation which is

7
<PAGE>

not a Subsidiary of such Person and which Indebtedness is nonrecourse to such
Person).

"Land" is defined in the first recital.
---- -------------

"Land Lease Amendment" is defined in the recitals.
-------------------- --------

"Leases" or "Lease" means, collectively or individually, the Amended
------ -----
Building Lease and the Amended Land Lease.

"Lessee" is defined in the preamble.
------ --------

"Lessor" is defined in the preamble.
------ --------

"Net Income" means, for any period, the aggregate of all amounts which,
----------
in accordance with GAAP, would be included as net income on the consolidated
financial statements of Guarantor.

"Obligations" is defined at Section 2.1.
----------- -----------

"Operating Lease Payments" means all monetary payment obligations under
------------------------
any leasing or similar arrangement which, in accordance with GAAP, would be
classified as an operating lease.

"Organic Documents" means (i) Guarantor's certificate of incorporation
-----------------
and bylaws, and (ii) all shareholder agreements, voting trusts and similar
arrangements applicable to any of its authorized shares of its capital stock
which are referred to in Guarantor's Form 10-K or Form 10-Q or of which
Guarantor is otherwise aware.

"Original Building Lease" is defined in the recitals.
----------------------- --------

"Original Land Lease" is defined in the recitals.
------------------- --------

"PBGC" means the Pension Benefit Guaranty Corporation and any entity
----
succeeding to any or all of its functions under ERISA.

"Pension Plan" means a "pension plan", as such term is defined in
------------
section 3(2) of ERISA, which is subject to Title IV of ERISA (other than a
multi-employer plan as defined in section 4001(a)(3) of ERISA), and to which
Guarantor or any of its Subsidiaries, or any corporation, trade or business that
is, along with the Guarantor or any of its Subsidiaries, a member of a
Controlled Group, may have liability, including any liability by reason of
having been a substantial employer within the meaning of section 4063 of ERISA
at any time during the preceding five years, or by reason of being deemed to be
a contributing sponsor under section 4069 of ERISA.

"Person" means any natural person, corporation, partnership, joint
------
venture, firm, association, trust, government, governmental

8
<PAGE>

agency or any other entity, whether acting in an individual, fiduciary or other
capacity.

"Property" means the Land and the buildings and improvements thereon.
--------

"Quick Ratio" means the ratio of
-----------

(a) the consolidated cash (excluding restricted cash), Cash Equivalent
Investments, and trade accounts receivable net of reserves of Guarantor and
its Subsidiaries

to
--

(b) consolidated current liabilities of Guarantor and its
Subsidiaries.

"Tangible Net Worth" means the consolidated net worth of Guarantor and
------------------
its Subsidiaries after subtracting therefrom the aggregate amount of any
intangible assets of Guarantor and its Subsidiaries, including goodwill,
franchises, licenses, patents, trademarks, trade names, copyrights, service
marks and brand names.

"Taxes" means any present or future income, excise, stamp or franchise
-----
taxes and other taxes, fees, duties, withholdings or other charges of any nature
whatsoever imposed by any taxing authority.

"United States" or "U.S." means the United States of America, its fifty
------------- ----
States and the District of Columbia.

"Welfare Plan" means a "welfare plan", as such term is defined in
------------
section 3(1) of ERISA.

SECTION 1.2 Accounting and Financial Determinations. Unless
---------------------------------------
otherwise specified, all accounting terms used herein shall be interpreted, all
accounting determinations and computations hereunder (including under Section
-------
4.2.3) shall be made, and all financial statements required to be delivered
- - -----
hereunder shall be prepared in accordance with, those generally accepted
accounting principles ("GAAP") applied in the preparation of the financial
----
statements referred to in Section 3.1.5.
-------------

SECTION 1.3 Definitions in the Leases. Unless otherwise defined
-------------------------
herein or the context otherwise requires, terms used in this Guaranty, including
its preamble and recitals, have the meanings provided in the Leases.

9
<PAGE>

ARTICLE II

GUARANTY PROVISIONS

SECTION 2.1 Guaranty. Guarantor hereby absolutely, unconditionally
--------
and irrevocably

(a) guarantees to Lessor the full and prompt payment and performance
of each of the obligations of Lessee under the Leases (collectively, the

"Obligations") which Obligations shall include without limitation:
------------

(i) full and prompt payment of all Basic Rent, Additional Rent,
Capital Rent, the Aggregate Balance Due with respect to Lessee's
Obligations under the Leases to purchase the Property and any other
payments or amounts required to be paid by Lessee under the Leases
(including all such amounts which would become due but for the
operation of the automatic stay under Section 362(a) of the United
States Bankruptcy Code, 11 U.S.C. (S)362(a)), and the operation of
Sections 502(b) and 506(b) of the United States Bankruptcy Code, 11
U.S.C. (S)502(b) and (S)506(b);

(ii) the full and prompt payment, execution and performance of
all covenants and agreements of Lessee under each of the Leases,
including without limitation Sections 19.3, 20.3, 27, 41 and 51 of the
Amended Land Lease and Sections 19.3, 20.3, 27, 41 and 51 of the
Amended Building Lease; and

(iii) the full and prompt payment, execution and performance of
all obligations, covenants, liabilities and agreements of Lessee under
the Consent Agreement, including without limitation, all amounts
payable by Lessee pursuant to Section 5.2 of the Consent Agreement;

(b) agrees to indemnify, hold harmless and reimburse Lessor for (i)
any damages that Lessor may incur as a result of Lessee's failure to
perform any Obligations, including without limitation any damages Lessor
may incur if Lessor sells or causes the Property to be sold to any Person
following Lessee's failure to perform its obligations as set forth at
Section 41 of the Amended Land Lease or Section 41 of the Amended Building
Lease or as provided in the Consent Agreement, and (ii) any and all costs
and expenses (including reasonable attorney's fees and expenses) incurred
by Lessor in enforcing any rights under this Guaranty or under either or
both of the Leases or the Consent Agreement; and

10
<PAGE>

pay to Lessor immediately and without any deduction, discount or offset of
any nature, any amount not paid to Lessor by the Lessee (for any reason and
regardless of any defense or protection available to the Lessee with
respect thereto) which would have been paid to Lessor by the Lessee over
the full term of the Leases and upon the expiration thereof had the Lessee
fulfilled all of its obligations under the Leases including without
limitation Lessee's obligations arising upon the expiration or termination
of either of the Leases.

This is a Guaranty of performance and payment when due and not of collection.
Guarantor specifically agrees that it shall not be necessary or required that
Lessor exercise any right, assert any claim or demand or enforce any remedy
whatsoever against Lessee (or any other Person) before or as a condition to the
obligations of Guarantor hereunder. Guarantor acknowledges that it has received
full and complete copies of and has approved the Consent Agreement and the
Leases described in the recitals.

SECTION 2.2 Acceleration of Guaranty. Guarantor agrees that, in the
------------------------
event of the dissolution or insolvency of Lessee or Guarantor, or the inability
or failure of Lessee or Guarantor to pay debts as they become due, or an
assignment by Lessee or Guarantor for the benefit of creditors, or the
commencement of any case or proceeding in respect of Lessee or Guarantor under
any bankruptcy, insolvency or similar laws, and if such event shall occur at a
time when any of the Obligations of the Lessee may not then be due and payable,
Guarantor will pay to Lessor forthwith the full amount which would be payable
hereunder by Guarantor if all such Obligations were then due and payable.

SECTION 2.3 Guaranty Absolute, etc. This Guaranty shall in all respects
----------------------
be a continuing, absolute, unconditional and irrevocable guaranty of payment and
performance, and shall remain in full force and effect until all Obligations of
Lessee have been paid in full or performed, and all obligations of the Guarantor
hereunder shall have been paid in full. Guarantor guarantees that the
Obligations of Lessee will be paid and performed strictly in accordance with the
terms of the Lease or the Consent Agreement under which they arise, regardless
of any law, regulation or order now or hereafter in effect in any jurisdiction
affecting any of such terms or the rights of Lessor with respect thereto. The
liability of Guarantor under this Guaranty shall be absolute, unconditional and
irrevocable irrespective of, and Guarantor hereby waives:

(a) any defense based upon any lack of validity, legality or
enforceability of either of the Leases;

(b) any defense based upon the failure of Lessor

11
<PAGE>

(i) to give notice to Guarantor of the occurrence of any default
by Lessee under the terms of either of the Leases or the Consent
Agreement,

(ii) to assert any claim or demand or to enforce any right or
remedy against Lessee or any other Person (including any other
guarantor) under the provisions of either of the Leases or the Consent
Agreement or otherwise, or

(iii) to exercise any right or remedy against any other guarantor
of, or collateral securing, any Obligations of the Lessee;

(c) any change in the time, manner or place of payment or performance
of, or in any other term of, all or any of the Obligations of Lessee or any
other extension, compromise or renewal of any Obligation of Lessee;

(d) any reduction, limitation, impairment or termination of the
Obligations of Lessee for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and Lessor and Lessee shall
not be subject to (and Guarantor hereby waives any right to or claim of)
any defense or setoff, counterclaim, recoupment or termination whatsoever
by reason of the invalidity, illegality, nongenuineness, irregularity,
compromise, unenforceability of, or any other event or occurrence
affecting, the Obligations of Lessee or otherwise;

(e) any limitation on amounts recoverable from Lessee under
California Civil Code Section 1951.2 in the event of termination of either
or both of the Leases;

(f) any amendment to, rescission, waiver, or other modification of,
or any consent to departure from, any obligation, covenant or agreement set
forth in either of the Leases or the Consent Agreement (other than and to
the extent that an amendment in writing executed by the Lessor by its terms
specifically indicates that it is the intent of Lessor that such amendment
reduce Guarantor's liability under this Guaranty);

(g) any addition, exchange, release, surrender or non-perfection of
any collateral, or any amendment to or waiver or release or addition of, or
consent to departure from, any other guaranty, held by Lessor securing any
of the Obligations of Lessee; or

(h) any other circumstance which might otherwise constitute a defense
available to, or a legal or equitable discharge of, Lessee, any surety or
any guarantor.

12
<PAGE>

Guarantor agrees that any release which may be given by Lessor to Lessee or any
other guarantor shall not release Guarantor. Without limiting the foregoing,
Guarantor acknowledges that a breach of any representation, warranty or covenant
of Guarantor hereunder will result in an Event of Default under each of the
Leases. Without limiting any other remedy Lessor may have against Guarantor
hereunder or against Lessee under the Leases, Guarantor shall following the
occurrence of any such breach under this Guarantee and upon the written demand
of Lessor purchase the Property as required pursuant to Section 41 of the
Amended Land Lease and Section 41 of the Amended Building Lease.

SECTION 2.4 Reinstatement, etc. Guarantor agrees that this Guaranty
------------------
shall continue to be effective or be reinstated, as the case may be, if at any
time any payment (in whole or in part) or performance of any of the Obligations
of Lessee is rescinded or must otherwise be restored by Lessor, upon the
insolvency, bankruptcy or reorganization of the Lessee or for any other reason,
all as though such payment or performance had not been made.

SECTION 2.5 Waiver, etc. (a) Guarantor hereby waives promptness,
-----------
diligence, notice of acceptance and any other notice with respect to any of the
Obligations of Lessee and this Guaranty and any requirement that Lessor protect,
secure, respect or insure any Lien, or any property subject thereto, or exhaust
any right or take any action against Lessee or any other Person (including any
other Guarantor) or entity or any collateral securing the Obligations of Lessee.
Guarantor further waives (to the maximum extent permitted by law) any defense
arising by reason of any claim or defense based upon any limitation imposed on
amounts recoverable by Lessor under the Leases, including, if and to the extent
applicable, the provisions of California Civil Code Section 1951.2 or an
election of remedies by Lessor including, if and to the extent applicable, the
provisions of (S)(S)580d and 726 of the California Code of Civil Procedure or
any similar law of California or any other jurisdiction.

(B) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR OTHER PROVISION
SET FORTH IN THIS GUARANTY, GUARANTOR SPECIFICALLY WAIVES ANY POSSIBLE CLAIM
THAT GUARANTOR IS NOT A TRUE GUARANTOR OF THE LEASES (OR EITHER OF THEM),
WHETHER SUCH CLAIM IS BASED UPON ANY CONTENTION THAT THE LEASES (OR EITHER OF
THEM) ACTUALLY REPRESENT ONE OR MORE LOAN TRANSACTIONS, OR UPON ANY CONTENTION
THAT GUARANTOR ACTUALLY IS THE TRUE DEBTOR IF THE LEASES (OR EITHER OF THEM)
ACTUALLY REPRESENT ONE OR MORE LOAN TRANSACTIONS, OR UPON ANY OTHER SIMILAR OR
DISSIMILAR CONTENTION, OR UPON ANY COMBINATION THEREOF; AND GUARANTOR FURTHER
HEREBY WAIVES, TO THE MAXIMUM EXTENT SUCH WAIVER IS PERMITTED BY LAW, ANY AND
ALL DEFENSES ARISING DIRECTLY OR INDIRECTLY UNDER ANY ONE OR MORE OF CALIFORNIA
CIVIL CODE (S)(S) 1951.2, 2808, 2809, 2810, 2815, 2819, 2820, 2821, 2838, 2839,
2845, 2848, 2849 AND 2850, TO THE EXTENT APPLICABLE, CALIFORNIA CODE OF CIVIL
PROCEDURE (S)(S) 580A, 580B, 580C, 580D AND

13
<PAGE>

726, AND, TO THE EXTENT APPLICABLE, CHAPTER 2 OF TITLE 14, PART IV OF THE
CALIFORNIA CIVIL CODE.

(c) Without limiting the generality of any other waiver or other
provision set forth in this Guaranty, Guarantor authorizes Lessor at its sole
option, without notice or demand and without affecting the liability of the
Guarantor hereunder, to release and reconvey (with or without receipt of any
consideration) any Lien against any or all collateral for the Obligations of
Lessee, and to exercise all powers of sale in the Leases and to foreclose any or
all deeds of trust, mortgages or other instruments or agreements by judicial or
non-judicial sale, all without affecting the liability of the Guarantor
hereunder. Guarantor expressly waives any defense to the recovery by Lessor from
Guarantor of any deficiency after a non-judicial sale, including, without
limitation, any defense arising as a result of any election of remedies by
Lessor which limits or destroys such Guarantor's subrogation rights or such
Guarantor's right to proceed against Lessee for reimbursement (including,
without limitation, any election by Lessor to exercise its rights under a power
of sale in or any instruments securing the Obligations of Lessee under the
Leases, any deed of trust or mortgage and any consequential loss by Guarantor of
the right to recover any deficiency from the Lessee). Guarantor waives any right
to receive notice of any judicial or non-judicial sale or the sale or
foreclosure of any real property, and the failure of the Guarantor to receive
such notice shall not impair or affect the Guarantor's liability hereunder.
Guarantor warrants and agrees that each of the acknowledgements and waivers set
forth in this Guaranty is made with full knowledge of its significance and
consequences and that, under the circumstances, the waivers are reasonable and
not contrary to public policy or law. If, despite the foregoing, any of such
waivers are determined to be contrary to any applicable law or public policy,
such waivers shall be effective only to the maximum extent permitted by law.

SECTION 2.6 Subrogation. Guarantor hereby disclaims, releases and waives
-----------
forever any subrogation claims or rights it would otherwise have or be entitled
to under this Guaranty or pursuant to applicable law as a result of any payment
made by Guarantor hereunder or otherwise. Any amount paid to Guarantor on
account of any such subrogation rights shall be held in trust for the benefit of
Lessor and shall immediately be paid to Lessor and credited and applied against
the Obligations of Lessee, whether matured or unmatured, in accordance with the
terms of either of the Leases. In furtherance of the foregoing, Guarantor shall
refrain from taking any action or commencing any proceeding against the Lessee
(or its successors or assigns, whether in connection with a bankruptcy
proceeding or otherwise) to recover any amounts in the respect of payments made
under this Guaranty to Lessor.

14
<PAGE>

ARTICLE III

REPRESENTATIONS AND WARRANTIES

SECTION 3.1 Representations and Warranties. Guarantor hereby represents
------------------------------
and warrants to Lessor as set forth in this Article III.
-----------

SECTION 3.1.1 Organization, etc. Guarantor and each of its Subsidiaries
-----------------
is a corporation validly organized and existing and in good standing under the
laws of the State of its incorporation or organization, is duly qualified to do
business and is in good standing as a foreign corporation in each jurisdiction
where the nature of its business requires such qualification (except where the
failure so to qualify would not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the financial condition,
operations, assets, business, properties or prospects of Guarantor) and has full
power and authority and holds all requisite Governmental Approval to enter into
and perform its obligations under this Guaranty and each of the Operative
Documents and to own and hold under lease its properties and to conduct its
business substantially as currently conducted by it.

SECTION 3.1.2 Due Authorization, Non-Contravention, etc. The execution,
-----------------------------------------
delivery and performance by Guarantor of this Guaranty and each of the Operative
Agreements to which it is a party is within the Guarantor's corporate powers,
has been duly authorized by all necessary corporate action, and does not

(a) contravene Guarantor's Organic Documents;

(b) contravene any Governmental Requirement, Governmental Approval or
any material contractual restriction (including contractual restrictions
contained in any loan agreement or instrument to which Guarantor is a
party) binding on or affecting Guarantor; or

(c) result in, or require the creation or imposition of, any Lien on
any of Guarantor's properties (except in favor of Lessor).

SECTION 3.1.3 Government Approval, Regulation, etc. No Governmental
------------------------------------
Approval or other consent or approval of any Person which has not been obtained
is required for the due execution, delivery or performance by Guarantor of this
Guaranty or any other Operative Agreement to which it or the Lessee is a party,
or for the exercise by Lessor of any of its rights or remedies hereunder or
thereunder. Neither Guarantor nor any of its Subsidiaries is an "investment
company" within the meaning of the Investment Company Act of 1940, as amended,
or a "holding company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company",

15
<PAGE>

within the meaning of the Public Utility Holding Company Act of 1935, as
amended.

SECTION 3.1.4 Validity, etc. This Guaranty and each of the Operative
-------------
Agreements to which Guarantor or Lessee is a party constitutes the legal, valid
and binding obligation of Guarantor and Lessee, as applicable, enforceable in
accordance with its terms; except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally and by principles of equity.

SECTION 3.1.5 Financial Information. The consolidated balance sheets of
---------------------
Guarantor and its Subsidiaries as at December 31, 1991, June 28, 1992, December
27, 1992 and June 27, 1993, and the related consolidated statements of earnings
and cash flow of Guarantor and such Subsidiaries, copies of which have been
furnished to Lessor have been prepared in accordance with GAAP consistently
applied, and present fairly the consolidated financial condition of the entities
covered thereby as at the dates thereof and the results of their operations for
the periods then ended.

SECTION 3.1.6 No Material Adverse Change. Subject to the current
--------------------------
litigation between Guarantor and Intel Corporation described in Section 3.1.9
-------------
and the effect which that litigation may have upon Guarantor if determined
adversely to the Guarantor, which litigation and which effect are accurately
described in Guarantor's Forms 10-Q dated June 28, 1993 and September 26, 1993,
respectively, there has been no material adverse change in the financial
condition, operations, assets, business, properties or prospects of Guarantor or
any of its Subsidiaries since September 27, 1992.

SECTION 3.1.7 Litigation, Labor Controversies, etc. There is no pending
------------------------------------
or, to the knowledge of Guarantor, threatened litigation, action, proceeding, or
labor controversy affecting Guarantor or any of its Subsidiaries, or any of
their respective properties, businesses, assets or revenues which may materially
adversely affect the financial condition, operations, assets, business,
properties or prospects of Guarantor and its Subsidiaries, taken as a whole, or
which purports to affect the legality, validity or enforceability of this
Guaranty or either of the Leases except as described in Guarantor's Annual
Report on Form 10-K for the fiscal year ended December 27, 1992, Guarantor's
Quarterly Reports on Form 10-Q for the periods ended June 28, 1992, March 28,
1993, June 27, 1993 and September 26, 1993, and each of the Forms 8-K dated
September 7, 1993, September 9, 1993, and October 25, 1993. Lessor acknowledges
receipt of each of the Forms 10-K, Forms 10-Q and Forms 8-K specifically listed
in the preceding sentence.

SECTION 3.1.8 Subsidiary. Guarantor owns all of the outstanding voting
----------
stock in Lessee and all stock, securities and

16
<PAGE>

indentures convertible into voting stock. Except for Guarantor, no person
having any interest in Lessee has any right to cause a liquidation, distribution
or sale of all or a substantial portion of Lessee or its assets.

SECTION 3.1.9 Ownership of Properties. Except as permitted pursuant to
-----------------------
Section 4.2.2, Guarantor and each of its Subsidiaries owns good and marketable
- - -------------
title to all of its material properties and assets, real and personal, tangible
and intangible, of any nature whatsoever (including patents, trademarks, trade
names, service marks and copyrights), free and clear of all Liens, charges or
claims (including infringement claims with respect to patents, trademarks,
copyrights and the like other than infringement claims which would not
materially and adversely affect the business of Guarantor and its Subsidiaries,
taken as a whole, or infringement claims which are described in Guarantor's Form
10-K for the Fiscal Year ended December 27, 1992, Form 10-Q for the quarterly
periods ended March 28, 1993, June 27, 1993 and September 26, 1993, and Form 8-
Ks dated September 7, 1993, September 9, 1993 and October 25, 1993. To the best
of Guarantor's knowledge after due investigation, and subject to the last
sentence of this Section 3.1.9, Guarantor and each of its Subsidiaries owns or
-------------
holds licenses for all necessary patents, patent rights and other similar
intellectual property rights to conduct its business as presently conducted.
Guarantor's right to use certain intellectual property rights pertaining to the
Intel 386 and 486 microprocessors is the subject of current litigation between
Guarantor and Intel Corporation. The current status of that litigation, and the
effect which that litigation may have upon Guarantor if determined adversely to
the Guarantor, are accurately described in Guarantor's Forms 10-Q dated June 27,
1993 and September 26, 1993.

SECTION 3.1.10 Taxes. Guarantor and each of its Subsidiaries has filed
-----
all tax returns and reports required by any Governmental Authority to have been
filed by it and has paid all Taxes and governmental charges thereby shown to be
owing, except any such Taxes or charges which are being diligently contested in
good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books.

SECTION 3.1.11 Pension and Welfare Plans. During the twelve-consecutive-
-------------------------
month period prior to the date of the execution and delivery of this Guaranty no
steps have been taken to terminate any Pension Plan, and no contribution failure
has occurred with respect to any Pension Plan sufficient to give rise to a Lien
under section 302(f) of ERISA. No condition exists or event or transaction has
occurred with respect to any Pension Plan which might result in the incurrence
by Guarantor or any member of the Controlled Group of any material liability,
fine or penalty. Neither Guarantor nor any member of the Controlled Group has
any contingent liability with respect to any post-retirement benefit under a
Welfare Plan, other

17
<PAGE>

than liability for continuation coverage described in Part 6 of Title I of
ERISA.

SECTION 3.1.12 Environmental Warranties. Except for matters
------------------------
("Environmental Matters") set forth in Schedule II, none of which would have a
material adverse effect on the financial condition, operations, assets,
business, properties or prospects of Guarantor and its Subsidiaries, taken as a
whole:

(a) all facilities and property (including underlying groundwater)
owned or leased by Guarantor or any of its Subsidiaries, including without
limitation the Property, have been, and continue to be, owned or leased by
Guarantor and its Subsidiaries in material compliance with all
Environmental Laws;

(b) there have been no past, and there are no pending or threatened

(i) claims, complaints, notices or requests for information
received by Guarantor or any of its Subsidiaries with respect to any
alleged violation of any Environmental Law, or

(ii) complaints, notices or inquiries to Guarantor or any of its
Subsidiaries regarding potential liability under any Environmental Law;

(c) there have been no Releases of Hazardous Materials at, on or
under any property now or previously owned or leased by Guarantor or any of
its Subsidiaries, including without limitation the Property, that, singly
or in the aggregate, have, or may reasonably be expected to have, a
material adverse effect on the financial condition, operations, assets,
business, properties or prospects of Guarantor and its Subsidiaries, taken
as a whole;

(d) Guarantor and its Subsidiaries have been issued and are in
material compliance with all Governmental Requirements and Governmental
Approvals relating to environmental matters and necessary or desirable for
their businesses;

(e) no property now or previously owned or leased by Guarantor or any
of its Subsidiaries, including without limitation the Property, is listed
or proposed for listing (with respect to owned property only) on the
National Priorities List pursuant to CERCLA, on the CERCLIS or on any
similar state list of sites requiring investigation or clean-up;

(f) to Guarantor's best knowledge, there are no underground storage
tanks, active or abandoned, including

18
<PAGE>

petroleum storage tanks, on or under any property now or previously owned
or leased by either Guarantor or any of its Subsidiaries, including without
limitation the Property, that, singly or in the aggregate, have, or may
reasonably be expected to have, a material adverse effect on the financial
condition, operations, assets, business, properties or prospects of
Guarantor and its Subsidiaries, taken as a whole;

(g) neither Guarantor nor any of its Subsidiaries has directly
transported or directly arranged for the transportation of any Hazardous
Material to any location which is listed or proposed for listing on the
National Priorities List pursuant to CERCLA, on the CERCLIS or on any
similar state list or which is the subject of federal, state or local
enforcement actions or other investigations which may lead to claims
against the Guarantor or any Subsidiary thereof for any remedial work,
damage to natural resources or personal injury, including claims under
CERCLA, which, singly or in the aggregate, have, or may reasonably be
expected to have, a material adverse effect on the financial condition,
operations, assets, business, properties or prospects of Guarantor and its
Subsidiaries, taken as a whole;

(h) there are no polychlorinated biphenyls or friable asbestos
present at any property now or previously owned or leased by Guarantor or
any of its Subsidiaries, including without limitation the Property, that,
singly or in the aggregate, have, or may reasonably be expected to have, a
material adverse effect on the financial condition, operations, assets,
business, properties or prospects of Guarantor and its Subsidiaries, taken
as a whole; and

(i) no conditions exist at, on or to Guarantor's best knowledge under
any property now or previously owned or leased by Guarantor or any of its
Subsidiaries, including without limitation the Property, which, with the
passage of time, or the giving of notice or both, would give rise to
liability under any Environmental Law.

Nothing in this Section 3.1.12 shall be deemed to limit or modify any
--------------
representation or warranty in the Environmental Indemnity Agreement.

SECTION 3.1.13 Regulations G, U and X. Neither the Guarantor nor any of
----------------------
its Subsidiaries is engaged in the business of extending credit for the purpose
of purchasing or carrying margin stock. Terms for which meanings are provided in
F.R.S. Board Regulation G, U or X or any regulations substituted therefor, as
from time to time in effect, are used in this Section with such meanings.

SECTION 3.1.14 No Default. Neither Guarantor nor any of its Subsidiaries
----------
is (a) in default under any indenture, mortgage, loan

19
<PAGE>

agreement or other agreement or instrument to which any of them is now a party
or by which it is bound, or (b) in violation of any Governmental Requirements or
Governmental Approvals, which, in the case of (a) or (b) above, would (i)
materially adversely affect either the Property or the properties, business,
operations or financial condition of Guarantor and its Subsidiaries taken as a
whole, (ii) materially adversely affect the ability of Guarantor and its
Subsidiaries to perform any of its obligations under this Guarantee or any of
the Operative Agreements, (iii) materially adversely affect the rights of any
other Person a party to an Operative Agreement, or (iv) materially adversely
affect the transactions contemplated by any of the Operative Agreements.

SECTION 3.1.15 Representations and Warranties in the Leases. Each of
--------------------------------------------
Lessee's representations and warranties contained in the Leases and the Consent
Agreement is true, complete and correct in all material respects.

SECTION 3.1.16 Accuracy of Information. All factual information
-----------------------
heretofore or contemporaneously furnished by or on behalf of Guarantor or any of
its Subsidiaries in writing to the Lessor for purposes of or in connection with
this Guaranty or any Operative Agreements or any transaction contemplated hereby
or thereby is, and all other such factual information hereafter furnished by or
on behalf of Guarantor or any of its Subsidiaries to Lessor will be, true and
accurate in every material respect on the date as of which such information is
dated or certified and as to the documents and materials listed on and except as
specifically set forth in Schedule III as of the date of execution and delivery
of this Guaranty, and such information is not, or shall not be, as the case may
be, incomplete by omitting to state any material fact necessary to make such
information not misleading. Notwithstanding the foregoing, while Guarantor has
exercised reasonable care in preparing the financial forecasts and construction
budgets furnished to Lessor, Lessor acknowledges that the information contained
in such forecasts and budgets are preliminary and subject to change.

ARTICLE IV

COVENANTS, ETC.

SECTION 4.1 Affirmative Covenants. Guarantor covenants and agrees that,
---------------------
so long as any portion of the Obligations of Lessee shall remain unpaid or
unperformed, Guarantor will, unless Lessor shall otherwise consent in writing,
perform the obligations set forth in this Section.

SECTION 4.1.1 Financial Information, Reports, Notices, etc. Guarantor
--------------------------------------------
will furnish, or will cause to be furnished, to Lessor

20
<PAGE>

copies of the following financial statements, reports, notices and information:

(a) as soon as available and in any event within 45 days after the
end of each of the first three Fiscal Quarters of each Fiscal Year a
consolidated balance sheet of Guarantor as of the end of such Fiscal
Quarter along with a consolidated statements of earnings and cash flow for
Guarantor for such Fiscal Quarter and for the period commencing at the end
of the previous Fiscal Year and ending with the end of such Fiscal Quarter,
certified by the chief financial or accounting officer of Guarantor;

(b) as soon as available and in any event within 90 days after the
end of each Fiscal Year a copy of the annual audit report for such Fiscal
Year for Guarantor, including therein a consolidated balance sheet of
Guarantor as of the end of such Fiscal Year and consolidated statements of
earnings and cash flow of Guarantor for such Fiscal Year, certified
(without any Impermissible Qualification) in a manner acceptable to the
Lessor by Ernst and Young or other independent certified public accountants
acceptable to the Lessor.

(c) as soon as available and in any event within 45 days of the end
of each Fiscal Quarter, a certificate executed by the chief financial
officer of Guarantor, showing (in reasonable detail and appropriate
calculations and computations in all respects satisfactory to Lessor)
compliance with the financial covenants set forth in Sections 4.2.1 and
--------------
4.2.3;
-----

(d) as soon as possible and in any event within three business days
after Guarantor or any of its Subsidiaries has knowledge of the occurrence
of a Default or a default or breach by Guarantor of any of Guarantor's
covenants or representations or warranties set forth in this Guaranty, a
statement of the chief financial or accounting officer of Guarantor setting
forth details of such Default or default and the actions Lessee or
Guarantor have taken or propose to take with respect thereto;

(e) as soon as possible and in any event within three business days
after (x) the occurrence of any adverse development with respect to any
litigation, action, proceeding, or labor controversy described in Section
-------
3.1.7 or (y) the commencement of any labor controversy, litigation, action,
-----
proceeding of the type described in Section 3.1.7, notice thereof and upon
-------------
request copies of all documentation relating thereto;

21
<PAGE>

(f) promptly after the receipt, sending or filing thereof, copies of
all material (i) statements, reports or other documents sent or received by
Guarantor or Lessee to or from any Governmental Authority regarding any of
the Property or any of the Operative Agreements or to or from its security
holders and (ii) all reports and registration statements which Guarantor or
any of its Subsidiaries files with the Securities and Exchange Commission
or any national securities exchange;

(g) immediately upon the institution of any steps by Guarantor or any
other Person to terminate any Pension Plan, or the failure to make a
required contribution to any Pension Plan if such failure is sufficient to
give rise to a Lien under section 302(f) of ERISA, or the taking of any
action with respect to a Pension Plan which could result in the requirement
that Guarantor furnish a bond or other security to the PBGC or such Pension
Plan, or the occurrence of any event with respect to any Pension Plan which
could result in the incurrence by Guarantor of any material liability, fine
or penalty, or any material increase in the contingent liability of
Guarantor with respect to any post-retirement Welfare Plan benefit, notice
thereof and upon request copies of all documentation relating thereto; and

(h) such other information respecting the condition or operations,
financial or otherwise, of Guarantor or any of its Subsidiaries as Lessor
may from time to time reasonably request.

SECTION 4.1.2 Compliance with Laws, etc. Guarantor will, and Guarantor
-------------------------
will cause each of its Subsidiaries to, comply in all material respects with all
Governmental Requirements and Governmental Approvals the noncompliance with
which would (i) reasonably be expected to have a material adverse effect on the
financial condition, operations, assets, business or prospects of Lessee or
Guarantor and its Subsidiaries, taken as a whole, (ii) result in the creation or
imposition of a Lien (except as expressly permitted herein) or (iii) subject
Lessor to any liability, such compliance to include:

(a) the maintenance and preservation of the corporate existence of
Guarantor and Lessee and qualification as a foreign corporation of
Guarantor and each of its Subsidiaries in each jurisdiction where the
nature of its business requires such qualification;

(b) the payment, before the same become delinquent, of all taxes,
assessments and governmental charges imposed upon the Guarantor or any of
its Subsidiaries or upon their respective property except to the extent
that the failure to pay the same would not reasonably be expected to have a
material adverse effect on the financial condition,

22
<PAGE>

operations, assets, business, properties or prospects of Guarantor and its
Subsidiaries, taken as a whole.

SECTION 4.1.3 Maintenance of Properties. Guarantor will, and Guarantor
-------------------------
will cause each of its Subsidiaries to, maintain, preserve, protect and keep the
Property and all of its other facilities and properties in good repair, working
order and condition and make necessary and proper repairs, renewals and
replacements as required by Lessee under the Leases and so that its business may
be properly conducted at all times.

SECTION 4.1.4 Insurance. The Guarantor will, and will cause Lessee and
---------
each of its other Subsidiaries to, maintain or cause to be maintained with
reasonable insurance companies insurance with respect to its properties and
businesses (including business interruption insurance) against such casualties
and contingencies and of such types and in such amounts as is customary in the
case of similar businesses and will, upon request of Guarantor furnish to
Guarantor at reasonable intervals a certificate of an authorized officer of
Guarantor setting forth the nature and extent of all insurance maintained by
Guarantor and its Subsidiaries in accordance with this Section and as required
under each of the Leases and the Consent Agreement. All such insurance shall be
written by reputable insurers legally qualified to issue such insurance having
an A.M. Best policyholders rating of not less than A, or if written by an
insurer domiciled outside of the United States of America, such insurance shall
not exceed in the aggregate 10% of the policyholders' surplus of such insurer.

SECTION 4.1.5 Books and Records. The Guarantor will, and will cause each
-----------------
of its Subsidiaries to keep books and records which accurately reflect all of
its business affairs and transactions and permit Lessor or any of their
respective representatives, at reasonable times and intervals and upon
reasonable notice, to visit all of its and its Subsidiaries' offices, to discuss
its financial matters with its and its Subsidiaries' officers and independent
public accountant (and Guarantor hereby authorizes such independent public
accountant to discuss Guarantor's and its Subsidiaries' financial matters with
Lessor or its representatives) and to examine any of its and its Subsidiaries'
books or other corporate or partnership records. On and after the occurrence
and continuance of any Default or Event of Default, the Guarantor shall pay any
reasonable fees of such independent public accountant incurred in connection
with Lessor's exercise of its rights pursuant to this Section. Guarantor will
not, and Guarantor will cause each of its Subsidiaries not to, except in the
ordinary course of business, destroy any of the aforementioned books, records
and logs without the prior consent of Lessor.

SECTION 4.1.6 Environmental Covenant. Guarantor will, and Guarantor will
----------------------
cause each of its Subsidiaries to

23
<PAGE>

(a) use and operate the Property and all of its other facilities and
properties and to undertake and carry out the Alterations in material
compliance with all Environmental Laws, keep all necessary permits,
approvals, certificates, licenses and other authorizations relating to
environmental matters in effect and remain in material compliance
therewith, and handle all Hazardous Materials in material compliance with
all applicable Environmental Laws;

(b) immediately notify Lessor and provide copies upon receipt of all
material written claims, complaints, notices or inquiries relating to (i)
the condition of the Property or the compliance with Environmental Laws in
connection with the use or operation of the Property or (ii) Guarantor's or
any of its Subsidiaries' other facilities and properties or their
compliance with Environmental Laws which may have an adverse material
affect on Guarantor; and

(c) provide such information and certifications which Lessor may
reasonably request from time to time to evidence compliance with this
Section 4.1.6.
-------------

Nothing in this Section 4.1.6 shall be deemed to limit or modify any covenant or
-------------
negative covenant in the Environmental Indemnity Agreement.

SECTION 4.1.7 Maintenance of Authorizations, etc. Guarantor will, and
----------------------------------
Guarantor will cause each of its Subsidiaries to, maintain all necessary
Governmental Approvals with respect to the ownership, operation and maintenance
of the Property and the construction of the additions and all of its other
facilities and properties, and Guarantor will, and Guarantor will cause each of
its Subsidiaries to, comply with all Governmental Requirements and Governmental
Approvals governing the ownership, operation and maintenance thereof (except (a)
those being contested in good faith and by appropriate proceedings and (b) those
the failure of which to maintain or comply with would not (i) reasonably be
expected to have a material adverse effect on the financial condition,
operations, assets, business or prospects of the Guarantor or any of its
Subsidiaries, (ii) result in the creation or imposition of any Lien (except as
expressly permitted herein or in the Leases), or (iii) subject Lessor to any
liability).

SECTION 4.1.8 Performance of Obligations. Guarantor will, and Guarantor
--------------------------
will cause Lessee to, duly perform and observe all of its obligations,
covenants, and agreements under the Operative Agreements.

SECTION 4.1.9 Further Assurances. Guarantor agrees that, from time to
------------------
time at its own expense, it shall, and Guarantor shall cause each of its
Subsidiaries to, promptly execute and deliver all further agreements,
instruments and documents, obtain or make such

24
<PAGE>

additional consents or filings, and take all further actions that may be
necessary, or that the Lessor may reasonably request, in order for the Guarantor
and its Subsidiaries to be in compliance with the terms hereof.

SECTION 4.2 Negative Covenants. Guarantor covenants and agrees that, so
------------------
long as any portion of the Obligations of the Lessee shall remain unpaid or
unperformed, Guarantor will not, without the prior written consent of the
Lessor, do anything prohibited in this Section.

SECTION 4.2.1 Indebtedness. Guarantor will not, and Guarantor will not
------------
permit any of its Subsidiaries to, create, incur, assume or suffer to exist or
otherwise become or be liable in respect of any Indebtedness, other than,
without duplication, the following:

(a) Indebtedness in respect of this Guaranty and Obligations of
Lessee;

(b) Indebtedness existing as of the date of this Guarantee which is
identified in the financial statements described at Section 3.1.5;
-------------

(c) Indebtedness in an aggregate principal amount not to exceed ten
percent of Tangible Net Worth at any time outstanding which is incurred by
Guarantor or any of its Subsidiaries to a vendor of any assets to finance
its acquisition of such assets provided that payment of such Indebtedness
is secured by a Lien encumbering only such assets;

(d) unsecured Indebtedness incurred in the ordinary course of
business (including open accounts extended by suppliers on normal trade
terms in connection with purchases of goods and services, but excluding
Indebtedness incurred through the borrowing of money or Contingent
Liabilities);

(e) Guarantor's guaranty of not more than $175,000,000 of
Indebtedness in a joint venture between Guarantor and Fujitsu Limited of
Japan as described in a Joint Venture Agreement between Guarantor and
Fujitsu Limited of Japan dated March 30, 1993;

(f) Indebtedness of not more than $105,000,000 in principal at any
time outstanding in respect of the Bank of America Credit Agreement;

(g) issuance by Guarantor of its unsecured senior notes of not more
than $106,000,000, in replacement of Guarantor's $106,000,000 Senior Notes
due November 20, 1992;

25
<PAGE>

(h) other Indebtedness of Guarantor or any of its Subsidiaries for
borrowed money or in the nature of Contingent Liabilities in an aggregate
amount not to exceed twenty-five percent of Tangible Net Worth at any time
outstanding;

provided, however, that no new Indebtedness otherwise permitted by clause (c),
- - -------- ------- ----------
(d), or (e) shall be incurred if, immediately prior to or after giving effect to
- - --- ---
the incurrence thereof, any Default shall have occurred and be continuing.

SECTION 4.2.2 Liens. Guarantor will not, and Guarantor will not permit
-----
any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien
upon any of its property, revenues or assets (including the Property), whether
now owned or hereafter acquired, except:

(a) Liens securing payment of the Obligations;

(b) Liens granted prior to the date hereof to secure payment of
Indebtedness of the type permitted and described in clause (b) of Section
---------- -------
4.2.1;
-----

(c) Liens granted to secure payment of Indebtedness of the type
permitted and described in clause (c) of Section 4.2.1 and covering only
---------- -------------
those assets acquired with the proceeds of such Indebtedness;

(d) Liens for taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty or
being diligently contested in good faith by appropriate proceedings and for
which adequate reserves in accordance with GAAP shall have been set aside
on its books;

(e) Liens of carriers, warehousemen, mechanics, materialmen and
landlords incurred in the ordinary course of business for sums not overdue
or being diligently contested in good faith by appropriate proceedings and
for which adequate reserves in accordance with GAAP shall have been set
aside on its books;

(f) Liens incurred in the ordinary course of business in connection
with workmen's compensation, unemployment insurance or other forms of
governmental insurance or benefits, or to secure performance of tenders,
statutory obligations, leases and contracts (other than for borrowed money)
entered into in the ordinary course of business or to secure obligations on
surety or appeal bonds; and

(g) judgment Liens which in the aggregate do not exceed $10,000,000
and which are in existence less than 10 days after the entry thereof or
with respect to which execution has been

26
<PAGE>

stayed or the payment of which is covered in full (subject to a customary
deductible) by insurance maintained with responsible insurance companies;

provided, however that no Liens otherwise permitted by (a) through (g) above
- - -------- -------
shall be permitted if such Liens are otherwise prohibited under either of the
Leases or the Consent Agreement.

SECTION 4.2.3 Financial Condition. Guarantor will not permit at any
-------------------
time:

(a) Its Tangible Net Worth to be less than the sum of: (i)
$700,000,000, (ii) 75% of Net Income for each Fiscal Quarter commencing
with the Fiscal Quarter commencing January 1, 1992, and (iii) 100% of all
additional equity;

(b) Its Quick Ratio to be less than 1.1 to 1.0.

(d) Its Fixed Charge Coverage Ratio for the immediately preceding
period of four Fiscal Quarters to be less than 1.25 to 1.00.

Guarantor agrees that if any financial covenant set forth in the Bank of America
Credit Agreement or any other loan or debt facility in an amount equal to or
greater than $50,000,000 provides at any time, for a greater Tangible Net Worth
requirement, lesser Debt to Tangible Net Worth ratio, greater Quick Ratio or
greater Fixed Charge coverage ratio as set forth above, then all or any of the
above requirements and ratios shall be deemed modified to be at least equal to
any such covenant or ratio applicable to Guarantor and any of its Subsidiaries
as set forth in the Bank of America Credit Agreement or such other facility.

SECTION 4.2.4 Restricted Payments, etc. If any Default or default or
------------------------
breach hereunder shall have occurred and be continuing:

(a) Guarantor will not declare, pay or make any dividend or
distribution (in cash, property or obligations) on any shares of any class
of capital stock (now or hereafter outstanding) of Guarantor or on any
warrants, options or other rights with respect to any shares of any class
of capital stock (now or hereafter outstanding) of Guarantor (other than
dividends or distributions payable in its common stock or warrants to
purchase its common stock or splitups or reclassifications of its stock
into additional or other shares of its common stock) or apply, or permit
any of its Subsidiaries to apply, any of its funds, property or assets to
the purchase, redemption, sinking fund or other retirement of, or agree or
permit any of its Subsidiaries to purchase or

27
<PAGE>

redeem, any shares of any class of capital stock (now or hereafter
outstanding), or warrants, options or other rights with respect to any
shares of any class of capital stock (now or hereafter outstanding); and

(b) Guarantor will not, and will not permit any of its Subsidiaries
to, make any deposit for any of the foregoing purposes during any period
when any such payment would be prohibited.

SECTION 4.2.5 Rental Obligations. Guarantor will not, and Guarantor will
------------------
not permit any of its Subsidiaries to, enter into at any time any arrangement
which does not create a Capitalized Lease Liability and which involves the
leasing by either Guarantor or any of its Subsidiaries from any lessor of any
real or personal property (or any interest therein) if non-performance by
Guarantor or any of its Subsidiaries of its obligations under such arrangement
would reasonably be expected to have a material adverse effect on the financial
condition, operations, assets, business, properties or prospects of Guarantor
and its Subsidiaries taken as a whole.

SECTION 4.2.6 Consolidation, Merger, etc. Guarantor will not, and
--------------------------
Guarantor will not permit any of its Subsidiaries including without limitation
Lessee to, liquidate or dissolve, consolidate with, or merge into or with, any
other corporation, except any Subsidiary (other than Lessee) may liquidate
voluntarily into, dissolve voluntarily into, and may merge with and into,
Guarantor or any other Subsidiary of Guarantor.

SECTION 4.2.7 Asset Dispositions, etc. Guarantor will not, and Guarantor
-----------------------
will not permit any of its Subsidiaries to, sell, transfer, lease, dispose,
contribute or otherwise convey, or grant options, warrants or other rights with
respect to, all or any substantial part of its assets (including accounts
receivable and capital stock of Subsidiaries) to any Person, unless (a) a
Default or a default or breach hereunder has not occurred and is continuing, (b)
such sale, transfer, lease, contribution or conveyance is in the ordinary course
of business of the Guarantor or such Subsidiary and (c) such sale, transfer,
lease, contribution or conveyance would not have a material adverse affect on
Guarantor or such Subsidiary.

SECTION 4.2.8 Bankruptcy Proceedings. Guarantor will not take any action
----------------------
to commence, institute, instigate, or cause to be filed bankruptcy proceedings,
whether involuntary or voluntary, against any of its Subsidiaries, including,
without limitation, Lessee.

SECTION 4.2.9 Transactions with Affiliates. Guarantor will not, and
----------------------------
Guarantor will not permit any of its Subsidiaries to, enter into, or cause,
suffer or permit to exist any arrangement or

28
<PAGE>

contract with any of its other Affiliates unless such arrangement or contract is
fair and equitable to Guarantor or such Subsidiary and is an arrangement or
contract of the kind which would be entered into by a prudent Person in the
position of Guarantor or such Subsidiary with a Person which is not one of its
Affiliates.

SECTION 4.2.10 Negative Pledges, Restrictive Agreements, etc. Except as
---------------------------------------------
provided in this Guaranty, Guarantor will not, and Guarantor will not permit any
of its Subsidiaries to, enter into any agreement prohibiting or restricting:

(a) the creation or assumption of any Lien upon its properties,
revenues or assets, whether now owned or hereafter acquired; or

(b) the ability of either Guarantor or Lessee to amend or otherwise
modify this Guaranty or the Leases; or

(c) the ability of any Subsidiary to make any payments, directly or
indirectly, to either Guarantor or Lessee by way of dividends,
distributions, advances, repayments of loans or advances, reimbursements of
management and other intercompany charges, expenses and accruals or other
returns on investments, or any other agreement or arrangement which
restricts the ability of any such Subsidiary to make any payment, directly
or indirectly, to either Guarantor or Lessee.

Notwithstanding the foregoing, the restrictions set forth in subsection
----------
4.2.10(a) above shall not be applicable to any agreement governing any
- - ---------
Indebtedness permitted by (i) clause (b) of Section 4.2.1 as in effect on the
---------- -------------
date of the Original Guaranty, (ii) clause (c) of Section 4.2.1 as to the assets
---------- -------------
financed with the proceeds of such Indebtedness, or (iii) clause (f) of Section
---------- -------
4.2.1 as to assets other than the Property. The restriction set forth in
- - -----
subsection 4.2.10(b) above shall not be applicable to Section 7.17 of the Bank
- - --------------------
of America Credit Agreement as such Section 7.17 was in effect on January 4,
1993. The restriction set forth in subsection 4.2.10(c) above shall not be
--------------------
applicable to Section 7.05 of the Bank of America Credit Agreement as such
Section 7.05 was in effect on January 4, 1993.

SECTION 4.2.11 Fees. Guarantor will pay or cause to be paid all
----
investment banking, broker's or finder's fees and commissions with respect to
the transactions contemplated by the Operative Agreements.

29
<PAGE>

ARTICLE V

COLLATERAL ACCOUNT

SECTION 5.1 Deposit Events. Each of the following events or occurrences
--------------
described in this Section 5.1 shall constitute a "Deposit Event":
-------------

5.1.1 Any representation or warranty of Guarantor made or deemed to
be made under this Guaranty, any Operative Agreement to which Guarantor is
a party or other writing or certificate furnished by or on behalf of
Guarantor to Lessor for the purposes of or in connection with this Guaranty
is or shall be incorrect when made in any material respect.

5.1.2 Guarantor shall default, fail to perform or observe any of the
covenants set forth at Article IV.

5.1.3 Any Change in Control shall occur.

5.1.4 Guarantor or any of its Subsidiaries defaults on the payment
of, or is otherwise in default (after expiration of any applicable grace
period) under, any Indebtedness (including, without limitation, the Bank of
America Credit Agreement) of Guarantor or such Subsidiaries to any Person
or Persons where such Indebtedness (individually or in the aggregate)
exceeds $10,000,000; or the occurrence of any event which would, by the
terms of Sections 8.01(i) or 8.01(j) of the Bank of America Credit
Agreement (as such Agreement is in effect on January 4, 1993), constitute
an Event of Default (as defined in the Bank of America Credit Agreement)
thereunder regardless of whether the Bank of America Credit Agreement is in
effect at such time or has been terminated.

SECTION 5.2 Deposit and Applications. Upon the occurrence of a Deposit
------------------------
Event, Guarantor shall within two (2) business days following receipt of written
demand from Lessor deposit in a cash collateral account (the "Collateral
----------
Account") maintained with Lessor and entitled "AMD Pledge Collateral Account for
the benefit of CIBC Inc." an amount equal to the Aggregate Balance Due plus the
present value (using a discount rate of five percent (5%)) of the remaining
unpaid Basic Rent due under each of the Leases. The amount deposited in the
Collateral Account shall be invested by Lessor at the direction of Guarantor in
Cash Equivalent Investments. All interest, dividends and earnings and other
distributions on such Cash Equivalent Investments shall also be deposited in the
Collateral Account. Lessor shall not incur any liability as a result of any
actions taken or not taken by it on its behalf in connection with the
maintenance of the Collateral Account and the investment of amounts deposited
therein, provided Lessor has not acted with gross negligence or willful
misconduct.

30
<PAGE>

The Collateral Account shall serve as security for the payment and
performance by Lessor of the Obligations. In the event of an Event of Default
under either of the Leases, including without limitation Lessee's failure to
perform its obligations under Section 41 of each of the Leases or the
Guarantor's failure to promptly perform and/or pay pursuant to this Guaranty,
Lessor is authorized, without giving written notice to, or the requirement that
any action be taken by, Guarantor to apply for the benefit of Lessor all or any
part of the Collateral Account to the payment of the Obligations. The rights of
the Lessor with respect to the Collateral Account are in addition to and not in
limitation of Lessor's other rights and remedies under this Guaranty and each of
the Leases, including without limitation the right of Lessor to declare an Event
of Default upon the occurrence of any event described in Section 5.1 above or to
demand that Guarantor purchase the Property pursuant to the last sentence in the
final paragraph of Section 2.3 of this Guaranty, and each such other right and
-----------
remedy may be exercised independently of Lessor's rights under this Article V.
---------

ARTICLE VI

MISCELLANEOUS PROVISIONS

SECTION 6.1 Successors, Transferees and Assigns; Transfers of Notes, etc.
------------------------------------------------------------
This Guaranty shall be binding upon Guarantor and its successors, transferees
and assigns and inure to the benefit of and be enforceable by the Lessor and its
successors, transferees and assigns, including without limitation any assignee
of all or any portion of Lessor's interest in the Leases or the Property.

SECTION 6.2 Amendments, etc. No amendment to or waiver of any provision
---------------
of this Guaranty, nor consent to any departure by either Guarantor herefrom,
shall in any event be effective unless the same shall be in writing and signed
by Lessor, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.

SECTION 6.3 Notices. All notices, requests, demands and other
-------
communications required or permitted hereunder shall be in writing and shall be
deemed to have been duly given when delivered by hand or on two business days
following consignment (freight prepaid) to a commercial overnight air courier
service or seven business days after being mailed, first class with postage
prepaid, return receipt requested:

31
<PAGE>

(a) If to the Guarantor, to

Advanced Micro Devices, Inc.
915 DeGuigne Drive
Sunnyvale, California 94086-3453
Attention: Chief Financial Officer

With a copy to:

Advanced Micro Devices, Inc.
915 DeGuigne Drive
Sunnyvale, California 94086-3453
Attention: General Counsel

or to such other person or address as the Guarantor shall furnish to the Lessor
in writing;

(b) If to the Lessor, to:

CIBC Inc.
275 Battery Street, Suite 1840
San Francisco, California 94111
Telecopy: (415) 399-5761
Attention: Managing Director, Electronics Group

With a copy to:

CIBC Inc.
425 Lexington Avenue
New York, New York 10017
Attention: Managing Director, Leasing Group

or to such other person or address as the Lessor shall furnish to the Guarantor
in writing.

SECTION 6.4 No Waiver; Remedies. In addition to, and not in limitation
-------------------
of, Section 2.3 and Section 2.5, no failure on the part of Lessor to exercise,
----------- -----------
and no delay in exercising, any right hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.

SECTION 6.5 Captions. Section captions used in this Guaranty are for
--------
convenience of reference only, and shall not affect the construction of this
Guaranty.

SECTION 6.6 Severability. Wherever possible each provision of this
------------
Guaranty shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law,

32
<PAGE>

such provision shall be ineffective to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Guaranty.

SECTION 6.7 Governing Law. THIS GUARANTY SHALL BE GOVERNED BY AND
-------------
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF CALIFORNIA.

SECTION 6.8 Forum Selection and Consent to Jurisdiction. ANY LITIGATION
-------------------------------------------
BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS GUARANTY, OR
ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN)
OR ACTIONS OF LESSOR OR GUARANTOR SHALL BE BROUGHT AND MAINTAINED IN THE COURTS
OF THE STATE OF CALIFORNIA OR IN THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF CALIFORNIA; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
-------- -------
ENFORCEMENT OF EITHER OR BOTH OF THE LEASES OR THE CONSENT AGREEMENT OR AGAINST
ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE LESSOR'S OPTION, IN THE
COURTS OF ANY JURISDICTION WHERE THE PROPERTY OR SUCH COLLATERAL OR OTHER
PROPERTY MAY BE FOUND. GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO
THE JURISDICTION OF THE COURTS OF THE STATE OF CALIFORNIA AND OF THE UNITED
STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA FOR THE PURPOSE OF
ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO BE BOUND BY ANY
JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION. GUARANTOR FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE
PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF CALIFORNIA.
GUARANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE
LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO
ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM. TO THE EXTENT THAT GUARANTOR HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY
FROM JURISDICTION OF ANY COURT OF FROM ANY LEGAL PROCESS (WHETHER THROUGH
SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION
OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, GUARANTOR HEREBY
IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS
GUARANTY AND THE OTHER OPERATIVE AGREEMENTS.

SECTION 6.9 Waiver of Jury Trial. GUARANTOR AND, BY ITS ACCEPTANCE OF
--------------------
THIS GUARANTY, LESSOR, HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY
RIGHTS EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS GUARANTY OR ANY OF
THE OTHER OPERATIVE AGREEMENTS. GUARANTOR ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS
PROVISION WAS A MATERIAL INDUCEMENT FOR LESSOR ENTERING INTO THE LEASES AND FOR
LESSOR TO ENTER INTO THE CONSENT AGREEMENT.

33
<PAGE>

IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be duly executed
and delivered by its officer thereunto duly authorized as of the date first
above written.

ADVANCED MICRO DEVICES, INC.

By: /s/ Marvin D. Burkett
--------------------------
MARVIN D. BURKETT
Senior Vice President and
Chief Financial Officer

Accepted this 17 day
of December, 1993

CIBC INC.

By: /s/ Tom R. Wagner
---------------------
Name: Tom R. Wagner
Title: Vice President

By:_______________________
Name:
Title:

34
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.29B
<SEQUENCE>5
<DESCRIPTION>1ST AMT. TO A&R GUARANTY DATED 9/21/94.
<TEXT>

<PAGE>

EXHIBIT 10.29(b)

FIRST AMENDMENT TO AMENDED AND RESTATED GUARANTY
------------------------------------------------

THIS FIRST AMENDMENT TO AMENDED AND RESTATED GUARANTY, dated as of
September 21, 1994 (this "Amendment"), by and between ADVANCED MICRO DEVICES,
---------
INC., a Delaware corporation (the "Guarantor"), and CIBC INC., a Delaware
---------
corporation ("Lessor").
------

W I T N E S S E T H:
-------------------

WHEREAS, pursuant to a Land Lease between AMD International Sales &
Service, Ltd., a Delaware corporation (the "Lessee") and Lessor, dated as of
------
September 22, 1992 and recorded on September 22, 1992 as Instrument No. 11550953
in the Official Records of the Recorder of Santa Clara County, California (the
"Recorder's Office"), as amended by that certain First Amendment to Land Lease
-----------------
dated as of December 22, 1992 and recorded on January 5, 1993 as Instrument No.
11720033 in the Recorder's Office, and as further amended by that certain Second
Amendment to Land Lease dated as of December 17, 1993 and recorded on December
20, 1993 as Instrument No. 12271737 in the Recorder's Office (such Land Lease,
as so amended, is referred to herein as the "Land Lease"), Lessor leased to
----------
Lessee the land (the "Land") described at Schedule I to the Guaranty (defined
----
below);

WHEREAS, pursuant to a Building Lease between Lessee and Lessor, dated as
of September 22, 1992 and recorded on September 22, 1992 as Instrument No.
11550954 in the Recorder's Office, as amended by that certain First Amendment to
Building Lease, dated as of December 22, 1992 and recorded on January 5, 1993 as
Instrument No. 11720034 in the Recorder's Office, and as further amended by that
certain Second Amendment to Building Lease, dated as of December 17, 1993 and
recorded on December 20, 1993 as Instrument No. 12271738 in the Recorder's
Office (such Building Lease, as so amended, is referred to herein as the
"Building Lease"), Lessor leased to Lessee the building and improvements located
--------------
on the Land, and Lessor funded certain Renovations (as defined in the Building
Lease), all as more specifically described in the Building Lease;

WHEREAS, the Guarantor executed and delivered to Lessor a Guaranty dated as
of September 22, 1992, which Guaranty was amended and restated by that certain
Amended and Restated Guaranty dated as of January 4, 1993, and further amended
and restated by that certain Amended and Restated Guaranty dated as of December
17, 1993 (collectively, the "Guaranty";
--------
<PAGE>

WHEREAS, the Guarantor, Bank of America National Trust and Savings
Association, as Agent, First National Bank of Boston, as Co-Agent, and certain
other Banks, entered into a Credit Agreement dated as of January 4, 1993 (the
"Bank of America Credit Agreement");
--------------------------------

WHEREAS, contemporaneously with the execution and delivery of this
Amendment, the Bank of America Credit is being amended and restated by a certain
Amended and Restated Credit Agreement, dated as of September 21, 1994 (the
"Effective Date"), among the Guarantor, Bank of America National Trust and
--------------
Savings Association, as Agent, First National Bank of Boston, as Co-Agent, and
certain other Banks (the "Restated Bank of America Credit Agreement"); and
-----------------------------------------

WHEREAS, the Guarantor has requested that the Lessor enter into this
Amendment with the Guarantor;

NOW THEREFORE, for good and valuable consideration the receipt of which is
hereby acknowledged, the Guarantor and the Lessor agree as follows:

1. Recitals; Definitions. The foregoing recitals are hereby incorporated
---------------------
into this Amendment. Unless otherwise defined herein or the context otherwise
requires, terms used in this Amendment, including its preamble and recitals,
shall have the meanings provided in the Guaranty.

2. Restated Bank of America Credit Agreement. As of the Effective Date,
-----------------------------------------
the following definition is hereby inserted in alphabetical order in Section 1.1
of the Guaranty:

"Restated Bank of America Credit Agreement" means the Bank of America
-----------------------------------------
Credit Agreement, as amended and restated by that certain Amended and
Restated Credit Agreement, dated as of September 21, 1994, among the
Guarantor, Bank of America National Trust and Savings Association, as
Agent, First National Bank of Boston, as Co-Agent, and certain other Banks,
as the same may be further amended, modified, supplemented or restated from
time to time.

3. Amendment to Section 4.2.1. As of the Effective Date, clause (f) of
--------------------------
Section 4.2.1 of the Guaranty is hereby deleted and replaced with the following:

(f) Indebtedness of not more than $250,000,000 in principal at any
time outstanding in respect of the Restated Bank of America Credit
Agreement;

4. Amendment to Section 4.2.3. As of the Effective Date, all references
--------------------------
in section 4.2.3 of the Guaranty to the Bank of America

-2-
<PAGE>

Credit Agreement are hereby changed to the Restated Bank of America Credit
Agreement.

5. Amendment to Section 4.2.10. As of the Effective Date, the
---------------------------
penultimate sentence of Section 4.2.10 of the Guaranty is hereby deleted.

6. Amendment to Section 5.1.4. As of the Effective Date, the first
--------------------------
reference to the Bank of America Credit Agreement in Section 5.1.4 of the
Guaranty is hereby changed to the Restated Bank of America Credit Agreement.

7. Captions. Section captions used in this Amendment are for
--------
convenience of reference only, and shall not affect the construction of this
Amendment.

8. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED
-------------
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF CALIFORNIA.

9. Affirmation of Guaranty. Except as amended by this Amendment, the
-----------------------
Guaranty is unmodified; and, as amended by this Amendment, the Guaranty remains
in full force and effect and is hereby reaffirmed by the Guarantor.

10. Lease Documents. All references in the Building Lease and the Land
---------------
Lease to the "Guaranty" shall hereafter refer to the Guaranty as amended hereby.

11. Counterparts. This Amendment may be executed in several
------------
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same instrument.

-3-
<PAGE>

IN WITNESS WHEREOF, each of Guarantor and Lessor has caused this Amendment
to be duly executed and delivered by its officer thereunto duly authorized as of
the date first above written.

ADVANCED MICRO DEVICES, INC. CIBC INC.

By: /s/ Marvin D. Burkett By:/s/ Robert A. Lever
------------------------- ---------------------------
MARVIN D. BURKETT Name: Robert A. Lever
Senior Vice President and Title: Vice President
Chief Financial Officer

By:/s/ James E. Anderson
---------------------------
Name: James E. Anderson
Title: Managing Director

CONSENTED AND AGREED TO:

By: AMD INTERNATIONAL SALES & SERVICE,
LTD.

By:/s/ Marvin D. Burkett
----------------------------
Name: Marvin D. Burkett
Title: President

CONSENTED AND AGREED TO:

By: LONG-TERM CREDIT BANK OF JAPAN,
LOS ANGELES AGENCY

By: /s/ Motokazu Uematsu
----------------------------
Name: Motokazu Uematsu
Title: Deputy General Manager

-4-
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.29E
<SEQUENCE>6
<DESCRIPTION>2ND AMT. TO BLDG. LEASE DATED 12/17/93.
<TEXT>

<PAGE>

Recording Requested By EXHIBIT 10.29 (e)
and When Recorded, Return to:

Mayer, Brown & Platt
350 South Grand Avenue
25th Floor
Los Angeles, California 90071-1563
Attention: Leslie T. Tedrow
(213) 229-9500

- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------

SECOND AMENDMENT TO BUILDING LEASE

THIS SECOND AMENDMENT TO BUILDING LEASE (this "Second Amendment") is entered
----------------
into as of December 17, 1993 (the "Execution Date"), by and between CIBC INC., a
--------------
Delaware corporation ("Lessor"), and AMD INTERNATIONAL SALES & SERVICE, LTD., a
------
Delaware corporation ("Lessee").
------

RECITALS
--------

A. Pursuant to that certain Building Lease, by and between Lessor and
Lessee dated as of September 22, 1992 and recorded on September 22, 1992 as
Instrument No. 11550954 in the Official Records of the Recorder of Santa Clara
County, California, as amended by that certain First Amendment to Building
Lease, dated as of December 22, 1992 and recorded on January 5, 1993, as
Instrument No. 11720034 in Official Records of the Recorder of Santa Clara
County, California (such Building Lease, as so amended, is referred to herein as
the "Original Building Lease"), Lessor leases the Building (defined
-----------------------
below) to Lessee and Lessee leases the Building from Lessor.

B. Lessee is in the process of renovating the Building and desires that
Lessor finance a portion of those renovations.

C. Lessor and Lessee desire to amend the Original Building Lease to (i)
provide that all renovations being undertaken to the Building will be
constructed for the benefit of Lessor and will be subject to the terms and
conditions of the Original Building Lease, as amended hereby, (ii) provide the
terms and conditions upon which Lessor will finance a portion of such
renovations, and (iii) incorporate certain other changes and modifications to
the Original Building Lease that have been agreed to by Lessor and Lessee.

D. Concurrently herewith, Lessor and Lessee also are amending that certain
Land Lease between Lessor and Lessee dated
<PAGE>

as of September 22, 1992 and recorded on September 22, 1992 as Instrument No.
11550953 in the Official Records of the Recorder of Santa Clara County,
California, as amended by a certain First Amendment to Land Lease, dated as of
December 22, 1992 and recorded on January 5, 1993 in the Official Records of the
Recorder of Santa Clara County, California as Document No. 11720033, pursuant to
which Lessor leases to Lessee certain land described in Appendix 1 attached
hereto.

NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Lessor and Lessee hereby agree as follows (terms used by not
defined herein shall have the meaning provided in the Original Building Lease):

A. MODIFICATIONS TO BUILDING LEASE

Lessor and Lessee hereby amend the Original Building Lease as follows, and
all references in the Original Building Lease to "this Lease" or "the Lease"
shall hereafter refer to said Original Building Lease as amended hereby:

1. Leased Property In Section 1.1., the following is hereby inserted after
--------------- -----------
"other improvements" in the first line of the indented paragraph: "including,
without limitation, the Renovations".

2. Fixed Term. In Section 1.2, the Expiration Date is hereby changed to
---------- -----------
December 22, 1995.

3. Lessor's Option to Renew. The following Section 1.3 is hereby inserted
------------------------ -----------
after Section 1.2:
-----------

1.3. Lessor's Option to Renew. If Lessee has not delivered to Lessor a
------------------------
written notice of Lessee's exercise of the Remarketing Option pursuant
to Section 41.6(A), Lessor may elect to renew the Fixed Term of this
---------------
Lease for an additional term of eight (8) years ending on the eighth
anniversary date of the Expiration Date by notifying Lessee in writing
of such renewal at least ninety (90) days, but not more than one
hundred eighty (180) days, prior to the Expiration Date. Such election
shall be within the absolute and sole discretion of Lessor, and nothing
herein shall require Lessor to renew or extend the Fixed Term of this
Lease. Lessee acknowledges that Lessor has not made any commitment,
oral or written, to renew the Lease at the end of the Fixed Term. Any
such renewal shall be on the same terms and conditions provided for in
this Lease, or at the option of Lessor at the then prevailing rates. In
the event Lessor elects to extend the Fixed Term as provided for above,
Lessor shall also be required to extend the term of

-2-
<PAGE>

the Land Lease for the same period. In connection with any such renewal,
Guarantor agrees to restate its Guaranty, in form and substance mutually
satisfactory to Lessor and to Guarantor, guaranteeing the Leases during
such renewal period. Nothing in this provision shall be construed to limit
Lessee's existing rights under any of the Operative Agreements between
Lessor and Lessee, including Lessee's rights to purchase the Leased
Property as provided for herein.

4. Definitions.
-----------

(a) The following definitions are hereby added to Section 2 in proper
---------
alphabetical sequence:

Advance: a disbursement hereunder by Lessor for the funding of the
-------
Renovations or any portion thereof.

Architect: Hellmuth, Obata & Kassabaum, Inc., a California
---------
corporation.

Architect's Agreement: means the Agreement For Design Services
---------------------
Construction Management Edition, dated as of January 13, 1993, between
Lessee and the Architect.

Balance Due: means as of the date of determination the sum of the
-----------
Lessor Purchase Price plus the Funded Amount reduced by any Qualified
Payments to the extent such application is permitted pursuant to the
definition of Qualified Payments.

Bonds: the meaning specified in Section 21.3(b)(vii).
----- --------------------

Building: means the Leased Property on the Land as of September 22,
--------
1992.

Commitment Fees the meaning specified in Section 21.11.
--------------- -------------

Consent Agreement: means the Construction Consent Agreement dated as
-----------------
of December 22, 1992, by and between Lessor and Lessee.

Construction Documents: means the Architects Agreement, the
----------------------
Contractors Agreement, the Consent Agreement, the Plans and Specifications,
and all soil reports and analyses. The Construction Documents shall also
include all modifications and additions to the foregoing approved in writing
by Lessor.

-3-
<PAGE>

Construction Schedule: shall mean the deadlines for completion of
---------------------
construction and the various construction milestones as provided for in the
Consent Agreement.

Contractor: DPR Construction, Inc., a California corporation.
----------

Contractors Agreement: means the Agreement dated as of November 19,
---------------------
1992, between Guarantor and the Contractor.

Draw Request: the meaning specified in Section 21.4(a)(i).
------------ ------------------

Execution Date: the meaning set forth in the preamble.
--------------

Funded Amount: means as of any date of determination the cumulative
-------------
aggregate sum of all Advances made in respect of the Renovations to date.

Funding Termination Date: means March 23, 1994
------------------------

Lender: means Long-Term Credit Bank of Japan, Ltd., Los Angeles
------
Agency, and any other entity which provides financing to Lessor to fund
its obligations hereunder or to refinance its interests in this Lease.

Letter Agreement: the meaning specified in Section 21.11.
---------------- -------------

LIBOR Office: means Lessor's office at 275 Battery Street, Suite 1840,
------------
San Francisco, California, or such other office of Lessor as designated
from time to time by notice from Lessor to Lessee, whether or not outside
the United States, which shall be making or maintaining a loan with
reference to LIBO Rates.

Maximum Advance Amount: means an amount equal to Twelve Million Five
----------------------
Hundred Thousand Dollars ($12,500,000.00).

Option Termination Date: the meaning specified in Section 41.1(b).
----------------------- ---------------

Plans and Specifications: means all of those certain plans and
------------------------
specifications, dated July 28, 1993, issued by the Architect with respect
to the Renovations, including (i) the portions thereof prepared by
Sasco/Valley Electric covering electrical systems, and (ii) the portions
thereof prepared by The Linford Company covering mechanical systems.

-4-
<PAGE>

Preconstruction Value: the meaning specified in Section 21.3(b).
--------------------- ---------------

Qualified Payments: means all payments received by Lessor from time to
------------------
time during the term of this Lease from any party (1) under any casualty
insurance policy as a result of damage to the Leased Property or the Land,
(2) as compensation for any restriction placed upon the use or development
of the Leased Property or the Land or for the condemnation of the Leased
Property or the Land or any portion of either thereof, (3) because of any
final judgment, decree or award for injury or damage to the Leased Property
or the Land, or as a result of any settlement, agreed to by Lessor and
Lessee in writing, of any claim by Lessor for injury or damage to the
Leased Property or the Land, or (4) under any title insurance policy or
otherwise as a result of any title defect or claimed title defect with
respect to the Leased Property or the Land, but only to the extent that
such payment compensates Lessor for such title defect (excluding, for
example, reimbursement of legal fees or other defense costs); provided,
however, that (x) in determining "Qualified Payments", there shall be
deducted all expenses and costs of every kind, type and nature (including
Taxes and attorneys' fees) incurred by Lessor with respect to the
collection of such payments or the defense or prosecution of any claims,
(y) "Qualified Payments" shall not include any payment to Lessor by Lender
or a participant or Affiliate of or lender to Lessor that is made to
compensate Lessor for Lender's or such the participant's or Affiliate's
share of any costs, expenses, liabilities or losses which Lessor may incur
as a result of any of the events described in the preceding clauses (1)
-----------
through (4) and (z) "Qualified Payments" shall not include any payments
---
received by Lessor that Lessor has paid to Lessee or any other person for
the restoration or repair of the Leased Property or the Land or that Lessor
is holding as escrowed proceeds (pursuant Section 47). For purposes of
----------
computing the total Qualified Payments paid to or received by Lessor as of
any date, payments described in the preceding clauses (1) through (4) will
----------- ---
be considered as escrowed proceeds (pursuant to Section 47), not Qualified
----------
Payments, until they are actually applied as Qualified Payments by Lessor,
which will generally not occur until the first Installment Date which is at
least three (3) Business Days after Lessor's receipt of the same; and
provided further, that all insurance proceeds in connection with any damage
to the Leased Property or the Land as provided for in Section 19 hereof (or
----------
Section 19 of the Land Lease) or condemnation proceeds relating to a Taking
----------
as provided in Section 20 hereof (or Section 20 of the Land Lease) shall
---------- ----------
remain escrowed proceeds (pursuant to Section 47 hereof or
----------

-5-
<PAGE>

in the Land Lease, as the case may be) and shall not be payable to Lessee nor
reduce the Balance Due until and except as specifically provided for in Sections
--------
19 and 20. All Qualified Payments received by Lessor in connection with either
- - -- --
the Leased Property or the Land shall be first applied to reduce the Balance Due
hereunder; any Qualified Payments received by Lessor which are in excess of the
Balance Due hereunder shall be applied to reduce the "Balance Due" (as defined
in the Land Lease) pursuant to the Land Lease.

Renovations Budget: the construction budget attached as Exhibit A to the
------------------ ---------
Consent Agreement.

Renovations: means all of the changes, modifications and improvements to
-----------
be made to the Building (whether or not funded by Lessor) as described in the
Plans and Specifications.

Title Company: Lawyers Title Insurance Corporation.
-------------

Title Policy: the meaning specified in Section 21.4(a)(vi).
------------ -------------------

(b) The following definition is hereby deleted: AT&T Occupancy Agreement.
------------------------

(c) In the definition of Business Day, the following is hereby inserted
immediately after "San Francisco, California" in the third line of such
definition: ", Los Angeles, California".

(d) The term "Casualty Termination Price" is hereby changed to "Casualty
-------------------------- --------
Value Payment". All references in the Original Building Lease to "Casualty
- - -------------
Termination Price" are hereby changed to "Casualty Value Payment".

(e) The definition of Guaranty is hereby deleted and replaced with the
--------
following:

Guaranty: that certain Amended and Restated Guaranty, dated as of the
--------
date hereof, made by Guarantor in favor of Lessor.

(f) The definition of Land Lease is hereby deleted and replaced with the
----------
following:

Land Lease: means that certain Land Lease between Lessor and Lessee
----------
dated as of September 22, 1992 and recorded as Instrument No. 11550953 in
the Official Records of the Recorder of Santa Clara County, California, as
amended by that certain First Amendment to Land Lease, dated

-6-
<PAGE>

as of December 22, 1992 and recorded on January 5, 1993 in the Official
Records of the Recorder of Santa Clara County, California as Document No.
11720034, and as further amended by a certain Second Amendment to Land
Lease, dated as of the date hereof, and recorded on __________, 1993 in the
Official Records of the Recorder of Santa Clara County, California as
Document No. _____.

(g) In the definition of Legal Requirement, (i) the following is hereby
-----------------
inserted immediately after the phrase "whether foreseen or unforeseen and
whether ordinary or extraordinary": "(including, without limitation, any zoning
or building laws or ordinances, any noise abatement, occupancy, or environmental
protection laws or regulations, or any rules, regulations or orders of any
governmental agency), or any building permit or any condition, privilege,
license, easement, right-of-way, covenant, restriction or grant (whether or not
of record)", and (ii) the following is hereby added in clause (b) immediately
----------
after the phrase "foregoing impose obligations on": "Lessor, or".

(h) In the definition of Lessee's Equipment, (i) the following is hereby
------------------
inserted immediately after the phrase "installed at the Leased Property by
Lessee or any sublessee or assignee of Lessee, at its cost": "and not purchased
with funds advanced by Lessor", and (ii) the following is hereby inserted
immediately after "removal systems" and preceding the closing parenthesis: ",
all of which shall not constitute Lessee's Equipment".

(i) The definition of Lessor Purchase Price is hereby deleted and replaced
---------------------
with the following:

Lessor Purchase Price: an amount of $14,453,416.14, paid by Lessor to
---------------------
acquire the Building.

(j) The definition of LIBO Rate is hereby deleted and replaced with the
-------
following:

LIBO Rate: means with respect to any Quarterly Period, an interest rate
---------
per annum equal at all times during such Quarterly Period to the rate of
interest per annum (rounded upwards, if necessary, to the next 1/16 of 1%)
at which deposits (in an amount equal to the Balance Due as of the first
day of any Quarterly Period) in United States dollars in immediately
available funds are offered or are available to Lessor's LIBOR Office in
the eurodollar interbank market at 10:00 a.m. (Pacific Standard Time) two
Business Days before the first day of such Quarterly Period for a three (3)
month period; provided, however, that if Lessee shall notify Lessor not
less than four (4) Business Days prior to

-7-
<PAGE>

the first day of any Quarterly Period (except the second Quarterly Period
in which a six (6) month LIBO Rate is already in effect, and except as
otherwise provided below) that Lessee desires that the LIBO Rate for such
Quarterly Period and the succeeding Quarterly Period be based on a six (6)
month period, then the LIBO Rate with respect to such two (2) Quarterly
Periods shall be an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal at all times during such two (2) Quarterly
Periods to the rate of interest at which deposits (in an amount equal to
the Balance Due as of the first day of the first of such two (2) Quarterly
Periods) in United States dollars in immediately available funds are
offered or are available to Lessor's LIBOR Office in the Eurobank interbank
market at 10:00 a.m. (Pacific Standard Time) two (2) Business Days before
the first day of the first of such two (2) Quarterly Periods for such six
(6) month period. Lessee may not elect a six (6) month LIBO Rate with
respect to any Quarterly Period expiring during the period beginning on the
date hereof and ending on the first Installment Date after the earlier of
(i) the Funding Termination Date, and (ii) the earliest date on which the
Funded Amount equals the Maximum Advance Amount. If Lessor is unable to
determine the LIBO Rate at any time, or Lessor shall determine that the
introduction of any change in or in the interpretation of any law makes it
unlawful, or any central bank or other governmental authority asserts that
it is unlawful for Lessor to calculate rent based on the LIBO Rate, then
the LIBO Rate for the applicable Quarterly Period shall be the Corporate
Base Rate.

(k) The definition of LIBO Rent is hereby deleted and replaced with the
---------
following:

LIBO Rent: as of an Installment Date means:
---------

(a) with respect to the period beginning December 2, 1993 and ending
December 21, 1993 (such period being a portion of the Quarterly Period
beginning on September 22, 1993 and ending on December 21, 1993), an amount
equal to $33,373.34; and

(b) with respect to each Quarterly Period commencing after the date
hereof, the quotient of (1) the product of (i) the Balance Due as of the
beginning of the Quarterly Period in which such Installment Date falls
(such Balance Due shall include the amount of any Advance made on the first
day of such Quarterly Period), multiplied by (ii) the sum of 1% plus the
rate obtained by dividing the LIBO Rate by a percentage equal to 100% minus
the LIBO Reserve Percentage, multiplied by (iii) the number of actual days

-8-
<PAGE>

elapsed (including such Installment Date) in the Quarterly Period that
includes such Installment Date, divided by (2) 360.

As used herein, "LIBO Reserve Percentage" means the maximum reserve
-----------------------
percentage applicable to Lessor for such Quarterly Period (or if more than
one such percentage is applicable during such period, the daily average of
such percentages for those days in such period during which each such
percentage is applicable) under applicable law, including, without
limitation, regulations issued from time to time by the Federal Reserve
Board, for determining the maximum reserve requirement (including, without
limitation, any emergency, supplemental or other marginal reserve
requirement) with respect to liabilities or assets consisting of or
including (x) eurocurrency liabilities in the amount of the above
referenced portion of the Balance Due and having a maturity substantially
the same as such Quarterly Period and (y) any other category of liabilities
which includes deposits by reference to which the LIBO Rate is to be
determined. Lessor shall submit a certificate to Lessee which shall set
forth in reasonable detail the basis for, calculation of and the amount of
LIBO Rent, which certificate shall be conclusive and binding for all
purposes, absent manifest error.

(l) The definition of Operative Agreements is hereby deleted and replaced
--------------------
with the following:

Operative Agreements: (i) this Lease, (ii) the Land Lease, (iii) the
--------------------
Guaranty, (iv) that certain Purchase and Sale Agreement, dated as of April
15, 1992, between American Telephone and Telegraph Company, as seller, and
Guarantor, as buyer, as amended by that certain First Amendment to Purchase
and Sale Agreement dated as of August 10, 1992, and as further amended by
that certain Second Amendment to Purchase and Sale Agreement dated as of
September 17, 1992, (v) that certain Restated Hazardous Materials
Undertaking and Unsecured Indemnity, dated of even date herewith, by Lessee
and Guarantor in favor of Lessor, (vi) that certain Assignment of Purchase
and Sale Agreement dated as of September 21, 1992, made by Guarantor in
favor of Lessor, (vii) that certain agreement, dated as of September 21,
1992, between American Telephone and Telegraph Company and Lessee, (viii)
that certain Consent to Assignment of Purchase and Sale Agreement, dated as
of September 21, 1992, made by American Telephone and Telegraph Company in
favor of Lessor and Guarantor, (ix) the Consent Agreement, (x) the Letter
Agreement, and (xi) any and all other documents executed by Lessee or
Guarantor or any Affiliate of either thereof in connection with any of the
foregoing.

-9-
<PAGE>

(m) The term "Taking Termination Price" is hereby changed to "Taking Value
------------------------ ------------
Payment." All references in the Original Building Lease to "Taking Termination
- - -------
Price" are hereby changed to "Taking Value Payment".

5. (a) Basic Rent. Section 3.1 is deleted in its entirety and replaced
---------- -----------
with the following language:

Basic Rent. Lessee shall pay to Lessor Basic Rent by no later than 12:00
----------
Noon (Los Angeles time) on each Installment Date. For purposes of this
Lease, Basic Rent shall mean, as of an Installment Date, an amount equal to
the sum of (i) LIBO Rent plus (ii) Capital Rent.

(b) Additional Rent. In Section 4, (i) the following is hereby inserted at
--------------- ---------
the end of clause (a), immediately preceding clause (b): "including, without
---------- ----------
limitation, the amounts required to be paid by Lessee to Lessor pursuant to

Sections 21.11 and 41.6.J,", and (ii) the reference to subdivision (b) of
- - -------------- ------
Section 25.1 in the parenthetical in the second sentence is hereby changed to
- - ------------
subdivision (c) of Section 25.1. The following is hereby inserted at the end of
------------
Section 4:
- - ---------

"On April 22, 1994, Lessee shall pay (by check or other method of payment
acceptable to Lessor and Lessee) to Lessor an amount equal to One Dollar
($1.00), which amount shall be applied against the Balance Due as of such
date. On May 22, 1994, Lessor shall pay (by check or other method of
payment acceptable to Lessor and Lessee) to Lessee an amount equal to One
Dollar ($1.00), which amount shall be added to the Balance Due as of such
date. The payments set forth in this grammatical paragraph of Section 4
---------
shall not in any way affect the calculation of Basic Rent or any other sums
due under this Lease."

6. Net Lease; No Counterclaim, Abatement, etc. In Section 5, (i) the word
------------------------------------------- ---------
"fully" is hereby inserted preceding "net lease" in the first sentence, (ii) the
phrase ", including, without limitation, the construction or financing of the
Renovations" is hereby inserted at the end of the first sentence after
"thereof", and (iii) the phrase "the construction of the Renovations or" is
hereby inserted in clause (g) after "interference with".
----------

7. Condition and Use of Leased Property. In Section 6, the following is
------------------------------------ ---------
hereby added immediately at the end of the capitalized text: "LESSEE
ACKNOWLEDGES THAT LESSEE IS SOLELY RESPONSIBLE FOR THE DESIGN, DEVELOPMENT AND
CONSTRUCTION OF THE RENOVATIONS AND ANY OTHER ADDITIONS OR MODIFICATIONS TO THE
BUILDING."

-10-
<PAGE>

8. Alterations. In Section 8, (i) the following is hereby inserted
----------- ---------
immediately preceding clause (a) in the first grammatical paragraph: "(except
----------
as otherwise contemplated pursuant to Section 21)", (ii) the phrase "(except
----------
with respect to the Renovations)" is hereby inserted in the fifth line of the
second grammatical paragraph after the phrase "performance bond", and (iii) the
following is hereby inserted at the end of such section: "Notwithstanding the
foregoing, nothing in this Section 8 shall reduce or otherwise relieve Lessee of
---------
any of its obligations and duties regarding the construction of the Renovations
as provided for at Section 21."
----------

9. Indemnification by Lessee. In Section 12, (i) the first sentence is
------------------------- ----------
hereby revised to begin as follows: "Lessee will (to the fullest extent
permitted by law) defend, protect, indemnify and save harmless Lessor, CIBC, any
Assignee, any Lender and their respective successors, assigns, participants,
officers, employees . . .".

10. Payment of Taxes, etc. Section 14 is hereby modified as follows:
---------------------- ----------

(a) Clause (a) is hereby deleted and replaced with the following:
----------

(a) Lessee shall hold Lessor harmless against and shall pay,
prior to delinquency, whether or not payable directly by Lessee or
Lessor or subject to withholding at the source: (i) all governmental
taxes, assessments, levies, fees, water and sewer rents and charges,
property taxes, licenses, permit fees and all other governmental
charges, general and special, ordinary and extraordinary, foreseen and
unforeseen, and all charges for utility or communications services,
which, at any time prior to or during the term of this Lease, (A) are
imposed or levied upon, assessed against or measured by (1) the Leased
Property or the value thereof, or the revenues, rents, issues, income,
awards, proceeds or profits thereof, (2) any Basic Rent, Additional
Rent or other sum payable hereunder or (3) this Lease or the leasehold
estate hereby created or (B) arise in respect of the occupancy,
operation, possession, leasing, subleasing, construction, repair,
rebuilding or use of the Leased Property; (ii) all transfer, sales,
recording, value added, use and similar taxes at any time levied,
assessed or payable on account of the acquisition, occupancy,
operation, possession, leasing, subleasing, construction, repair,
rebuilding or use of the Leased Property; (iii) all taxes,
assessments, levies, charges, fees, rents or payments in lieu of, or
as a substitute for, those
-11-
<PAGE>

payments referred to in clauses (i) and (ii) above or any part
----------- ----
thereof, whether or not expressly so designated; and (iv) all other
taxes imposed on, with respect to, or in connection with the Operative
Agreements and the transactions contemplated thereby, including any
sale of the Leased Property pursuant to Section 41 (all of the
----------
foregoing being referred to collectively as "Taxes"). The foregoing
-----
requirements of this Section 14(a) are subject to Lessee's rights
-------------
under Section 17 hereof. If any such Taxes may legally be paid in
----------
installments, Lessee may pay such Taxes in the installments due;
provided, however, that in such event, Lessee shall pay all remaining
installments (whether or not then due) prior to the expiration of this
Lease or upon termination of this Lease, except if such expiration
occurs as a result of Lessee purchasing the Leased Property pursuant
to Section 41 hereof.
----------

(b) In clause (b), item (iii) is hereby deleted, and item (iv) shall
---------- ---------- ---------
now become item (iii).
----------

11. Permitted Contests. In Section 17, insert the following in the first
------------------ ----------
sentence after the phrase "suppliers or vendors or lien therefor,": "or the
claims of any other Person affecting the Leased Property or the Land (or any
part thereof) or any Lien therefor,"

12. Risks To Be Insured. In Section 18.1, (i) the reference in clause (x)
------------------- ------------ ----------
to Lessor Purchase Price is hereby changed to Balance Due, and (ii) in clause
------
(e), the phrase "the Renovations or" is hereby inserted after "construction of".
- - ---

13. Total Destruction. In Section 19.3, all references to the term
----------------- ------------
"Casualty Termination Price" are hereby changed to "Casualty Value Payment".
All references to "Lessor Purchase Price" are hereby changed to "Balance Due".

14. Application of Insurance Proceeds. In Section 19.4, the reference to
--------------------------------- ------------
"Lessor Purchase Price" is hereby changed to "Balance Due". In clause (b), the
----------
phrase "payment of the purchase price" is hereby changed to "payment of the
Casualty Value Payment".

15. Total Taking. In Section 20.3, all references to "Taking Termination
------------ ------------
Price" are hereby changed to "Taking Value Payment". All references to "Lessor
Purchase Price" are hereby changed to "Balance Due".

16. Application of Awards. In Section 20.4, the phrase in clause (iii):
--------------------- ------------ ------------
"Lessor and shall be applied to reduce the Lessor Purchase Price" is hereby
changed to "Lessor as Qualified

-12-
<PAGE>

Payments and shall be applied to reduce the Balance Due (to the extent so
provided under the definition of `Qualified Payments')". In clause (b), the
----------
phrase "payment of the purchase price" is hereby changed to "the Taking Value
Payment".

17. Renovation of the Building. The following Section 21 is hereby
-------------------------- ----------
inserted as the new Section 21 (replacing "Intentionally Omitted"):
---------- ---------------------

21. Renovation of the Building.
--------------------------

21.1. Construction and Funding of the Renovations. The construction of
-------------------------------------------
the Renovations shall be carried out and constructed in accordance with
each of the terms and conditions of and shall be constructed and completed
within the time periods set forth in the Construction Schedule. In the
event of any conflict between the Consent Agreement and this Lease, the
terms and conditions of this Lease shall control. All of the Renovations
shall be part of the Leased Property and subject to Lessor's interest as
provided for in this Lease. Lessor shall reimburse Lessee for costs and
expenses incurred and paid by Lessee for such construction pursuant to the
terms of this Section 21; provided, however, in no event will the total of
---------- -------- -------
all Advances exceed the Maximum Advance Amount. Lessee agrees to fund all
amounts necessary to complete construction of the Renovations in excess of
the Maximum Advance Amount. Lessee acknowledges that Lessor is not under
any obligation to advance any portion of the funds previously advanced by
Lessor pursuant to this Section 21 which are repaid to Lessor by Lessee or
----------
by any third party as contemplated herein. Lessor shall not be liable to
Lessee for a failure to fund pursuant to this Section 21 to the extent
----------
Lender, for any reason, does not advance amounts to Lessor pursuant to any
loan agreements and other documents entered into between Lessor and Lender,
unless Lender's failure to fund is attributable to a failure of Lessor to
perform its obligations under any such loan agreement or other such
documents.

21.2. Request for Construction Funding. During the Fixed Term, but not
--------------------------------
later than March 8, 1994, Lessee may request Lessor to provide funding on
the first day of the next occurring Quarterly Period for the construction
of the Renovations. Each such request shall be in writing and presented to
the Lessor not less than ten (10) Business Days prior to the date specified
for funding the Advance. Each request for funding shall be for an amount
not less than One Million Dollars ($1,000,000).

21.3. Conditions Precedent to Initial Funding. The obligation of
---------------------------------------
Lessor to make the initial Advance hereunder

-13-
<PAGE>

for construction of the Renovations shall be subject to the following conditions
precedent:

(a) Lessor Approval. Lessor shall have approved the Construction
---------------
Documents.

(b) Documents. Lessor shall have received all the following, each duly
---------
executed and in form and substance satisfactory to Lessor:

(i) Certified Documents. Copies, certified by Lessee as being true and
-------------------
correct copies, of the Construction Documents, together with all required
governmental permits, licenses and approvals;

(ii) Assignment of Contracts. Assignments by Lessee of the
-----------------------
Construction Documents and all required governmental permits, licenses and
approvals, all in the form of the respective assignments attached hereto as
Schedule C, together with the consents to assignment (satisfactory to the
----------
Lessor) of the Architect and the Contractor; Schedule C is hereby added to
----------
and made a part of the Original Building Lease;

(iii) Subcontracts. A list, certified by Contractor, of each
------------
subcontract and (to the extent not included in such subcontracts) each
purchase agreement for work or materials; and, if subsequently requested in
writing by Lessor, a copy of any such subcontract the cost of which equals
or exceeds the sum of $200,000;

(iv) Renovations Budget. A copy, certified by Lessee as being a true
------------------
and correct copy, of Lessee's Renovations Budget;

(v) Insurance. Certificates of insurance evidencing compliance with
---------
the insurance requirements of this Lease and the Contractors Agreement;

(vi) Appraisal. A FIRREA appraisal which (a) conforms to and complies
---------
with the requirements set forth in Section 43 hereof, (b) sets forth the
----------
appraised value of the Building prior to commencement of the Renovations
(the "Preconstruction Value"), and (c) which demonstrates that the
---------------------
Renovations, upon completion and taken as a whole, will enhance the
Preconstruction Value by an amount not less than one hundred percent (100%)
of the Maximum Advance Amount; and

-14-
<PAGE>

(vii) Bonds. If Lessee elects to have the Contractors Agreement
-----
bonded, then there shall also be furnished to Lessor one or more payment
and performance bonds (collectively, the "Bonds") covering the Contractors
-----
greement, which Bonds shall name Lessor as a co-obligee under a dual
obligee bond and shall expressly permit Lessor direct access to and
recourse against the issuer of the bond.

21.4. Conditions Precedent to Each Advance. Lessor's obligation to make
------------------------------------
each Advance (including the initial Advance) shall be subject to the following
conditions precedent, all at Lessee's expense:

(a) Documents. Lessor shall have received all of the following, in form
---------
and substance reasonably acceptable to Lessor, at least 10 Business Days prior
to the requested disbursement date:

(i) Draw Request. A written request from Lessee or its agent
------------
requesting the Advance, which request shall be in the form attached hereto
as Schedule D (a "Draw Request"); Schedule D is hereby added to and made a
---------- ------------ ----------
part of the Original Building Lease;

(ii) Architect's Certification; Architect's Certificate for Payment. A
--------------------------------------------------------------
written certification from the Architect in the form attached hereto as
Schedule E;
----------

Together with a certified copy of the certificate for payment required to
be delivered to Lessor by the Architect pursuant to the Contractors
Agreement; Schedule E attached hereto is hereby added to and made a part of
----------
the Original Building Lease;

(iii) Contractor's Certification; Contractor's Application for
--------------------------------------------------------
Payment. A written certification from the Contractor in the form of
-------
Schedule F attached hereto, together with a certified copy of the
----------
Contractor's Application for Payment required to be delivered to Lessor by
the Contractor pursuant to the Contractor's Agreement; Schedule F attached
----------
hereto is hereby added to and made a part of the Original Building Lease;

(iv) Electrical Certification; Mechanical Certification. Written
--------------------------------------------------
certification from Sasco Valley Electric in the form of Schedule G attached
----------
hereto, and written certification from The Linford Company in the form of
Schedule H attached hereto; Schedules G and H
---------- ----------- -

-15-
<PAGE>

attached hereto are hereby added to and made a part of the Original
Building Lease;

(v) Lien Waivers. Unconditional waivers and releases of mechanics'
------------
liens for all work previously performed on the Land from (1) the Contractor
and (2) subcontractors and material suppliers on whose behalf funds are
sought for payment or have theretofore been disbursed, all of which waivers
shall comply with the mechanics' lien law of the State of California and
shall conform with the requirements of the Title Company;

(vi) Title Policy/Endorsement. (a) With respect to the first Advance,
------------------------
an ALTA Owner's Title Policy (the "Title Policy") insuring Lessor in the
amount of $40,000,000.00 in substantially the same form as that certain
ALTA Owner's Policy No. 113-00-470-120 issued by the Title Company to
Lessor dated September 22, 1992 (and including the endorsements issued
thereon, substituting, however, CLTA Form 123.1 in place of CLTA 123.2)
insuring, as of the date of the first Advance, Lessor's ownership interest
in the Land and Leased Property, subject only to Permitted Exceptions (the
"Title Policy"); and (b) with respect to each Advance except the first
Advance, an endorsement or endorsements to the Title Policy to cover such
Advance (i.e., increasing the policy amount and insuring against
intervening matters since the date of the last such endorsement), which
endorsement or endorsements shall show no encumbrances other than Permitted
Exceptions;

(vii) Progress Reports. Written statements from the Contractor and
----------------
Lessee setting forth and describing the progress of construction, the date
when it is anticipated that construction will be completed, and the causes
of delays or problems which could reasonably be expected to delay or
prevent completion of the Renovations; and

(viii) Change Orders. All change order information since the later of
-------------
June 30, 1993 or the date of the last Advance (to the extent not
theretofore submitted to Lessor pursuant to Section 21.6(a), which change
---------------
orders shall be made in accordance with Section 21.6(a).
---------------
(b) Financial Condition and Defaults. No material adverse change in the
--------------------------------
financial condition or operations of Guarantor and its subsidiaries shall have
occurred at any

-16-
<PAGE>

time or times subsequent to the financial statements described at Section 3.1.5
-------------
of the Guaranty, and Lessee shall not have received a written notice of Default
which remains uncured and no Event of Default shall exist.

21.5. Additional Obligations of Lessee. On the first day of each
--------------------------------
Quarterly Period which commences during the period beginning as of the date
hereof and ending on June 30, 1994, Lessee shall, unless an Advance is made on
such date, provide to Lessor the information, documents and certificates
required pursuant to Section 21.4(a), items (ii), (iii), (iv), (v), (vi)(b),
--------------- ----------- ----- ---- --- -------
(vii) and (to the extent not theretofore submitted to Lessor pursuant to
- - -----
Section 21.6(a)) (viii). During the period beginning on the date of the first
- - --------------- ------
Advance and ending on June 30, 1994, provided that Lessee shall have fulfilled
its obligations and shall be in compliance with its requirements under Sections
--------
21.3(b) and 21.4(a) hereof, Lessor will not request from Lessee, and Lessee
- - ------- -------
shall not be required to furnish to Lessor, (i) copies of lien waivers pursuant
to Section 3.2.2 of the Consent Agreement; (ii) later date title endorsements to
Lessor's Owner's title policy pursuant to Section 3.2.1 of the Consent Agreement
other than such later date endorsement upon final completion of the Alterations
pursuant to such Section 3.2.1 of the Consent Agreement; (iii) copies of any
permits, licenses or approvals pursuant to Section 4.1(C) of the Consent
Agreement to the extent that Lessee has delivered to Lessor a copy thereof
pursuant hereto.

21.6. Additional Provisions Regarding Construction.
--------------------------------------------

(a) Changes to Plans and Specifications. Copies of all changes to the
-----------------------------------
Plans and Specifications, the Renovations Budget and the Construction Schedule
must be promptly submitted to Lessor. All such changes must be first approved
by Lessor, except for those changes which:

(i) Do not increase or decrease the aggregate cost of the Renovations
as set forth in the original Renovations Budget described in Section 1 by
---------
more than Five Hundred Thousand Dollars ($500,000) for any single change
and which, when aggregated with all change orders made on or subsequent to
the date hereof, do not exceed Two Million Dollars ($2,000,000)
(aggregating all increases and decreases, and not netting decreases against
---
increases);

(ii) Do not conflict with, or cause the Plans and Specifications to
conflict with, and will not cause the Renovations (then or upon completion)
to fail to comply

-17-
<PAGE>

with, any applicable law, regulation, permit, license or approval relating
to the ownership, construction, use or occupancy of the Renovations, or any
covenant, condition or restriction affecting the Leased Property or the
Land; and

(iii) Do not and will not result in a reduction in the Fair Market
Value of the Leased Property.

(b) Lessor Advances. If (1) an uncured Default or Event of Default exists
---------------
at any time, and (2) any of the following conditions exists: (i) Lessor
reasonably believes that the Construction Schedule has been breached, (ii)
Lessor reasonably believes that completion of construction of the Renovations is
not being diligently pursued pursuant to Section 21.9, or (iii) Section 17
------------ ----------
hereof is being violated, then Lessor may at its option (but shall not be
obligated to) make Advances, even though Lessee has failed or refused to make a
Draw Request, and whether or not any conditions to such Advance shall have been
satisfied and regardless of whether such Advance is made on the first day of a
Quarterly Period, if Lessor deems it advisable to do so, including, without
limitation, for the purpose of paying or reimbursing Lessor for any amounts owed
by Lessee hereunder or under the Land Lease.

(c) No Waivers. The disbursement by Lessor of any Advance hereunder (i)
----------
without requiring fulfillment of any one or more of the conditions to such
Advance provided for in this Lease shall not be deemed a waiver of any condition
set forth herein with respect to any subsequent Advance and (ii) shall not be
deemed an approval or acceptance by Lessor of the work theretofore done as
having been completed in accordance with the Construction Documents.

(d) Stored Materials. Notwithstanding any other provision to the contrary,
----------------
Lessor shall not be required to make any disbursement for materials unless such
materials are incorporated into Renovations or are on the Land at the time of
such disbursement; Lessee hereby covenants that any materials on the Land but
not yet incorporated into the Renovations shall not be removed from the Land
without Lessor's prior written consent.

(e) Permits. Lessee will, promptly upon written request, deliver to Lessor
-------
copies, certified by Lessee as being true and correct copies, of all
governmental permits, licenses and approvals required for the construction of
the Renovations, including, but not limited to, building permits and
environmental approvals.

-18-
<PAGE>

21.7. Use of Funds. The proceeds of each Advance may be used only
------------
for the uses specified in the corresponding Draw Request and only in respect of
the Renovations in respect of which such Advance is made.

21.8. Progress of Construction. Lessee shall diligently pursue the
------------------------
construction and completion of the Renovations. Construction of all of the
Renovations shall be subject to the time requirements and deadlines provided for
in the Consent Agreement. Any failure to adhere to the time deadlines and
schedules set forth in the Consent Agreement shall constitute, at Lessor's
election, an Event of Default. Lessee shall deliver to Lessor prior to the date
construction must be completed under the Consent Agreement, each of the
following items in form and substance reasonably acceptable to Lessor, all at
Lessee's expense:

(a) Lien Waivers. Final unconditional lien waivers and releases from (i)
------------
the Contractor and (ii) all subcontractors and materials suppliers in respect of
all Renovations; and a final sworn statement from the Contractor.

(b) Architect's Completion Certificate. A certificate from the Architect
----------------------------------
certifying that construction has been substantially completed in accordance with
the Construction Documents and has been completed in accordance with all
applicable laws and regulations and all applicable governmental permits,
licenses and approvals, and will also comply with the requirements of all
covenants, conditions, and restrictions affecting the improved Parcel and
certifying that attached thereto are true, correct and complete copies of all
necessary or appropriate governmental permits, licenses and approvals for the
ownership, use and occupancy of the Leased Property (including a Certificate of
Occupancy), all of which have been issued, are unconditional and are in full
force and effect, unmodified. Lessee shall furnish Lessor with an original (or
copy certified by Architect) of the Architect's Certificate of Substantial
Completion which the Architect is required to issue pursuant to the Contractor's
Agreement. The requirement under Section 3.2.3(i) of the Consent Agreement that
Lessee deliver to Lessor an Architect's certificate shall be deemed satisfied by
delivery of the certificates required under this clause (b).
----------

(c) Final Plan. A copy, certified by Lessee or the Architect as being a
----------
true and correct copy, of the final Plans and Specifications containing all
field changes thereto made by the Contractor in the course of constructing the
Renovations. The delivery of such certified final Plans

-19-
<PAGE>

and Specifications shall also satisfy the requirements under clause (iii) of
------------
Section 3.2.3 of the Consent Agreement.

(d) Permanent Occupancy. A copy, certified by Lessee as being a true and
-------------------
correct copy, of the final Certificate of Occupancy, together with all
government certificates that Lessor may reasonably require from applicable
governmental authorities, evidencing compliance with all zoning, building, fire,
health, environmental and other applicable laws, rules and regulations, together
with evidence, satisfactory to Lessor, that there are no additions, actions or
proceedings pending or threatened to alter or declare invalid any of those laws,
ordinances, rules, regulations or permits or certificates for or relating to the
Renovations, to the Land, or any part thereof. Fulfillment of the requirements
under this clause (d) shall also fulfill the requirements under clause (ii) of
---------- -----------
Section 3.2.3 of the Consent Agreement.

21.9. Remedying Construction Defects. Lessee will promptly remedy, in a
------------------------------
manner reasonably satisfactory to Lessor, all such parts or aspects of
construction as Lessor may reasonably determine are not in compliance with the
Plans and Specifications.

21.10. Legal Requirements; Insurance Requirements. Lessee shall cause
------------------------------------------
such Renovations and the construction thereof to be in compliance with all Legal
Requirements, the Construction Documents, any restrictions of record and
Insurance Requirements.

21.11. Commitment Fees. On the Execution Date, Lessee shall pay to Lessor
---------------
a facility fee in the amount of One Hundred Thousand Dollars ($100,000). In
addition, Lessee shall pay to Lessor a commitment fee (the "Commitment Fee") for
--------------
the period from and including December 22, 1993 to and excluding the Funding
Termination Date, equal to the average of the daily unused portion of the
Maximum Advance Amount multiplied by 0.375% per annum. The Commitment Fee will
be calculated on the basis of a 360-day year, and the actual number of days
elapsed to be payable in arrears on each Installment Date, commencing on the
first such date to occur after the Execution Date, and at maturity. Lessor
shall pay to Lender the above described facility fee and Lender's share of the
Commitment Fee as required in the loan documents entered into between Lessor and
Lender. Nothing herein shall relieve Lessee and Guarantor from their
obligations to pay to Lessor any amounts which become due and owing pursuant to
that certain letter agreement (the "Letter Agreement)" by and among Lessee,
----------------
Guarantor, Lessor and CIBC Leasing Inc., dated July 23, 1993.

-20-
<PAGE>

18. Right of Lessor to Perform Lessee's Covenants, Etc. In Section 23,
-------------------------------------------------- -----------
the following is inserted immediately after the phrase "perform any act" in the
first sentence: "(including without limitation completion of the Renovations)."

19. Assignments, Subleases, Etc. by Lessee. In Section 24.1, the second
-------------------------------------- -------------
sentence shall end "operation of law or otherwise"; and the remainder of such
sentence is hereby deleted.

20. Events of Default. In Section 25.1, the following provisions are
----------------- ------------
hereby modified:

(a) in clause (a), the phrase ", the Commitment Fees or amounts due
----------
and owing under the Letter Agreement" is hereby inserted after "Basic
Rent";

(b) clause (b) is hereby deleted and replaced with the following:
----------
"Lessee shall fail to pay any amounts required to be paid pursuant to
Sections 19.3, 20.3 or 41 on the date the same becomes due and payable;
-------- ---- ---- --
or";

(c) the following clauses are hereby added after the text of clause
------
(o) but preceding the period:
---
(p) any Event of Default (as that term is defined in the Consent
Agreement) shall occur under the Consent Agreement; or

(q) a breach or Default by Lessee of its obligations described in
Sections 21.5, 21.6(a), 21.6(d), 21.7, 21.8 or 21.9 shall occur.
------------- ------- ------- ---- ---- ----

21. Trustee; Power of Sale. In Section 26, all references to "Lessor
---------------------- ----------
Purchase Price" are hereby changed to "Balance Due." The reference to
"Continental Lawyers Title Company" in Section 26 is hereby changed to "Lawyers
----------
Title Insurance Company."

22. Further Assurance for Lessee's Obligations. All references in Section
------------------------------------------ -------
27 to the "Lessor Purchase Price" are hereby changed to the "Balance Due".
- - --

23. Lender Costs. Section 28 is hereby deleted and replaced with the
------------ ----------
following:

"28. Lender Costs. Lessee hereby agrees to pay to Lender on Lessor's
------------
behalf all amounts described in Section 14 and Section 15 of that certain
Loan Agreement, dated as of December 17, 1993, between Lessor and Lender
(the "Loan Agreement"). All such amounts shall be paid by
--------------

-21-
<PAGE>

Lessee at the time, in the manner and as provided in the Loan Agreement or
as directed by Lender."

24. End of Lease Term. In Section 37, the phrase "and subject to the
----------------- ----------
Obligations of Lessee as provided for at Section 41" is hereby inserted after
----------
"termination of this Lease" in the first sentence.

25. Purchase and Remarketing of Leased Property. In Section 41, the
------------------------------------------- ----------
phrase "payment of the Balance Due and the" is hereby inserted immediately
preceding the phrase "purchase and sale".

26. Lessee's Option to Purchase. Section 41.1(a) is hereby deleted and
--------------------------- ---------------
replaced with the following:

41.1 Lessee's Option to Purchase. (a) Subject to the terms and
---------------------------
conditions and provisions set forth in this Section 41.1, Lessee shall have
------------
the option (the "Purchase Option"), to be exercised as set forth below at
---------------
any time on or before the Option Termination Date (as hereinafter defined),
to purchase from Lessor at any time during the Fixed Term Lessor's interest
in the Leased Property. Such option must be exercised by written notice to
Lessor, which exercise shall be irrevocable; and such exercise notice will
specify the closing date, which must occur on an Installment Date, for
Lessee's purchase of the Leased Property, which date shall not be more than
sixty (60) days following Lessor's receipt of such notice but in no event
later than the Expiration Date, and the closing of the conveyance of the
Leased Property shall occur on such date. In such event, subject to the
provisions set forth in this Section 41, on such closing date, Lessor shall
----------
convey to Lessee, and Lessee shall purchase from Lessor, Lessor's interest
in the Leased Property. The purchase price to be paid by Lessee for the
Leased Property shall be an amount equal to the Balance Due as of the
closing date of Lessee's purchase of the Leased Property. As a condition to
Lessor's obligations hereunder, Lessee shall also pay to Lessor all Basic
Rent, Additional Rent and other amounts that may have accrued as of such
date.

27. Purchase. Section 41.2 is hereby deleted and replaced with the
-------- ------------
following:

-22-
<PAGE>

along with all accrued Basic Rent, Additional Rent and other amounts then
due. Upon receipt of such amount, Lessee shall be deemed to have purchased
from Lessor, and Lessor shall convey to Lessee, on the Expiration Date all
of Lessor's interest in the Leased Property. Lessee acknowledges that under
Section 41 of the Land Lease, Lessee shall be obligated to pay the Balance
----------
Due (as defined in the Land Lease) under the Land Lease and purchase the
Land simultaneously with the purchase of the Leased Property. Lessee may
designate, in a notice given to Lessor not less than ten (10) days prior to
the closing of such purchase (time being of the essence), a transferee to
whom the conveyance shall be made (if other than to Lessee), in which case
such conveyance shall (subject to the terms and conditions set forth
herein) be made to such designee; provided, however, that such designation
--------
of a transferee shall not cause Lessee to be released, fully or partially,
from any of its obligations under this Lease, including without limitation
its obligation to pay the Balance Due on the Expiration Date and all other
accrued amounts.

28. Acceleration of Purchase Obligation. Section 41.3 is hereby deleted
----------------------------------- ------------
and replaced with the following:

41.3 Acceleration of Expiration Date Obligation. Lessee shall be
------------------------------------------
obligated to purchase Lessor's interest in the Leased Property and pay to
Lessor the Balance Due along with all amounts which have accrued and are
due and payable hereunder immediately upon the occurrence of any Event of
Default specified in clauses (k) or (l) of Section 25.1. Further,
----------- --- ------------
notwithstanding anything contained herein to the contrary, at any time upon
the occurrence and during the continuance of an Event of Default, if Lessor
gives Lessee a notice under Section 25.2(a)(i) terminating Lessee's right
------------------
of possession (for purposes of this Section 41 such notice being referred
----------
to as a "Purchase Acceleration Notice"), Lessee shall be obligated to
----------------------------
purchase Lessor's interest in the Leased Property and to pay to Lessor the
Balance Due along with all amounts which have accrued and are payable
hereunder on the date which is ten (10) business days following Lessee's
receipt of such Purchase Acceleration Notice. If Lessee's obligations under
this Section 41.3 take place on a date other than an Installment Date,
------------
Basic Rent shall be prorated to such date. Lessee acknowledges that its
receipt of a Purchase Acceleration Notice under this Section 41.3 shall
------------
also constitute a receipt by Lessee of a Purchase Acceleration Notice under
the Land Lease. The Lessor's right to terminate the Purchase Option
pursuant to Section 41.1 and to accelerate the purchase of the Lessor's
------------
interest in the Leased Property are independent of each other, and
notwithstanding anything in Section 41.1 to the
------------

-23-
<PAGE>

contrary, unless the Option Termination Date shall have first occurred, the
Purchase Option shall terminate and be of no further force or effect on the
date that any Purchase Acceleration Notice is given.

If Lessee fails to purchase Lessor's interest in the Leased Property
and pay the Balance Due along with all other amounts as provided for in the
preceding paragraph on the tenth (10th) Business Day following Lessee's
receipt of the Purchase Acceleration Notice, then, Lessor shall be free to
sell the Leased Property to another Person and upon any such subsequent
sale to any other Person by Lessor of Lessor's interest in the Leased
Property, Lessor shall be entitled to recover from Lessee, and Lessee shall
upon demand pay to Lessor, an amount equal to (i) the Balance Due, plus
----
(ii) the amount of all Basic Rent, Additional Rent and other sums payable
hereunder to and including the date of such demand (including, without
limitation, Breakage Amounts and all costs and expenses incurred by Lessor
in effectuating its remedies and making such sale or sales), minus (iii)
-----
the amount of all consideration (on a present value basis determined by the
application of a discount factor (per annum) equal to five percent (5%) to
the extent such consideration is not cash), received by Lessor in
connection with such sale.

29. Determination of the Purchase Price. In Section 41.4, (a) such
----------------------------------- ------------
Section shall hereafter be entitled "Breakage"; (b) the first grammatical
--------
paragraph is hereby deleted; (c) the remainder of said Section is hereby deleted
and replaced with the following:

In addition to all other amounts owed to Lessor hereunder, if Lessee's
payment of the Balance Due and purchase of Lessor's interest in the Leased
Property occurs on a date other than the LIBO Last Day (defined below), and
if the LIBO Rate for the three (3) month period commencing on the date on
which the Balance Due is paid is less than the LIBO Rate in effect during
the Quarterly Period in which such payment occurs, then Lessee shall pay to
Lessor on such date as an additional component of the Balance Due, the
Breakage Amount (defined below). If Lessee's payment of the Balance Due
occurs when a six (6) month LIBO Rate is in effect and on a date other than
the second Installment Date of such period, the Breakage Amount shall be an
amount equal to the present value of the difference between (A) the portion
----------
of the Basic Rent payments for the two (2) Quarterly Periods for which such
six (6) month LIBO Rate applies (prorated for the number of days in the
period beginning on the date of such purchase and ending on the second
Installment Date occurring in such six (6) month period with

-24-
<PAGE>

respect to which such six (6) month LIBO Rate applies), and (B) an amount
equal to what the portion of the Basic Rent for such two Quarterly Periods
(prorated for the number of days in the period beginning on the date on
which such purchase occurs and ending on the second Installment Date
occurring in such six (6) month period with respect to which such six (6)
month LIBO Rate applies) would have been had the Basic Rent for such two
(2) Quarterly Periods been calculated using the three (3) month LIBO Rate
in effect on the date of such purchase. If Lessee's payment of the Balance
Due occurs when a three (3) month LIBO Rate is in effect on other than the
last day of a Quarterly Period, the Breakage Amount shall be an amount
equal to the present value of the difference between (A) the portion of the
----------
Basic Rent payment for such Quarterly Period in which such purchase occurs
(prorated for the number of days during the period beginning on the date of
such purchase and ending on Installment Date at the end of such Quarterly
Period) and (B) an amount equal to what the portion of the Basic Rent
payment for such Quarterly Period (prorated for the number of days in the
period beginning on the date of such purchase and ending on the Installment
Date at the end of such Quarterly period) would have been had the Basic
Rent for such Quarterly Period been calculated using a three (3) month LIBO
Rate in effect on the date of such purchase. In either case, such
difference shall be discounted at a rate of 5% per annum. If any statute or
rule of law shall validly limit the amount due under this Section 41.4 to
------------
less than the amount above agreed upon, Lessor or Assignee shall be
entitled to the maximum amount allowable under such statute or rule of law.

30. Purchase Procedure. In Section 41.5, (a) the phrase "purchase price
------------------ ------------
therefor" in the first paragraph is hereby deleted and replaced with "Balance
Due (and all other amounts due and owing hereunder)"; (b) the second grammatical
paragraph, the first sentence shall begin as follows: "If Lessee shall purchase
Lessor's interest in the Leased Property pursuant to Section 41.1(b) or if
---------------
Lessee's obligation to pay the Balance Due and purchase the Leased Property is
accelerated pursuant to Section 41.3, Lessee shall deliver the Balance Due to
------------
Lessor together with ..."; and (c) the following is hereby inserted at the end
of the parenthetical in the penultimate sentence in such second grammatical
paragraph: "and pay to Lessor the Balance Due along with all other amounts due
and owing hereunder".

31. Option to Remarket. The second grammatical paragraph of Section 41.6
------------------ ------------
is hereby deleted and replaced with the following:

-25-
<PAGE>

Lessee's effective exercise and consummation of the Remarketing Option
shall be subject to the due and timely fulfillment of each of the following
provisions, the failure of any of which shall render the Remarketing Option
and Lessee's exercise thereof null and void, in which event, Lessee shall
be obligated on the Expiration Date to pay to Lessor the Balance Due (and
all other accrued amounts) and perform its obligations under Section 41.2
------------
and if the Expiration Date shall have occurred, this Lease shall
automatically be deemed extended until five (5) Business Days after such
Expiration Date and the purchase by Lessee under Section 41.2 and payment
------------
of the Balance Due and all other amounts due and owing hereunder shall (and
all other accrued amounts) be consummated on the fifth such Business Day.

Subparagraph I is hereby deleted and replaced with the following: "The
Renovations shall have been completed in accordance with the requirements set
forth at Section 21, and any Restoration (in the event of a Taking or any
----------
casualty or other damage or destruction) shall be completed prior to Expiration
Date."

In subparagraph J, the first reference to "Lessor Purchase Price" is hereby
deleted and replaced with "Balance Due plus all other amounts due and owing
hereunder", and the second reference thereto is hereby replaced with "Balance
Due". The reference in clause (x) in such subparagraph J to $12,763,323.00 is
----------
hereby deleted and replaced with Twenty-Three Million Eight Hundred Forty-Two
Thousand Six Hundred Twenty-Two Dollars ($23,842,622.00).

The reference in subparagraph L to "Lessor Purchase Price" is hereby
deleted and replaced with "Balance Due and all other amounts due and owing
hereunder".

The parenthetical and succeeding phrase "within ten (10) business days" in
subparagraph M is hereby deleted and replaced with the following: "(and Lessee
shall be obligated to purchase the Leased Property and pay to the Lessor the
Balance Due together with all other amounts due and owing hereunder pursuant to

Section 41.2) within five (5) business days".
- - ------------

The following sentence is hereby added after the last sentence in Section
-------
41: "Lessee shall pay to Lessor each amount due pursuant to this Section 41 by
- - -- ----------
no later than 12:00 Noon (Los Angeles time) on the date such payment is due and
payable."

32. Transaction Expenses. The following subsection is hereby added to
--------------------
Section 51 after the end of clause (iv) thereof
- - ---------- -----------

-26-
<PAGE>

but prior to the period (and the word "and" at the end of clause (iii) thereof
------------
is hereby deleted):

"; and

(v) The out-of-pocket expenses incurred by Lender in connection with
the negotiation, preparation, execution, delivery and perfection of the
loan documents entered into between Lender and Lessor pursuant to which
Lessor finances a portion of its obligations hereunder or otherwise
refinances its interest in this Lease, including, without limitation, all
reasonable fees and disbursements of counsel to Lender."

33. The following Sections are hereby inserted after Section 51 (and the
----------
subsequent Sections are hereby renumbered accordingly).

52. Additional Waivers. IN CONNECTION WITH THE TRANSACTIONS PROVIDED
------------------
FOR HEREIN AND AS FURTHER CONSIDERATION FOR LESSOR AGREEING TO ENTER INTO
THIS SECOND AMENDMENT, LESSEE WAIVES, TO THE MAXIMUM EXTENT SUCH WAIVER IS
PERMITTED BY LAW, ANY AND ALL DEFENSES ARISING DIRECTLY OR INDIRECTLY UNDER
ANY ONE OR MORE OF CALIFORNIA CIVIL CODE (S)(S) 1951.2, 2808, 2809, 2810,
2815, 2819, 2820, 2821, 2838, 2839, 2845, 2848, 2849 AND 2850, TO THE
EXTENT APPLICABLE, CALIFORNIA CODE OF CIVIL PROCEDURE (S)(S) 580A, 580B,
580C, 580D AND 726, AND, TO THE EXTENT APPLICABLE, CHAPTER 2 OF PART IV,
TITLE 14, OF THE CALIFORNIA CIVIL CODE.

53. Lessee Further Acknowledgments. Lessee has been represented by
------------------------------
legal and tax counsel, independent accountants and other professionals,
each of which has been personally selected by Lessee, as Lessee has found
necessary to consult concerning the consummation of the transactions
contemplated in this Lease and the other Operative Agreements, and such
representation has included an examination and analysis of Lessee's rights
and obligations and the basis of all accounting, tax, financial and legal
aspects and treatment under this Lease and the other Operative Agreements.
With respect to the accounting, tax, financial and legal consequences of
the transactions contemplated herein and in the Operative Agreements,
Lessee is relying solely upon the advice of its own tax, accounting and
legal advisors and upon its knowledge with respect thereto.

54. Certain Tax Matters. Without limiting the acknowledgements made by
-------------------
Lessee at Section 53, Lessor and Lessee agree that, in accordance with
----------
their intentions and the substance of the transactions contemplated hereby
and to

-27-
<PAGE>

the extent permitted by law, Lessee (and not Lessor) shall be treated as
the owner of the Leased Property for Federal, state, and local income tax
purposes. Lessee shall be entitled to take any deduction, credit allowance
or other reporting, filing or other tax position consistent with such
characterizations. Lessor shall not file any Federal, state or local income
tax returns, reports or other statements in a manner which is inconsistent
with the foregoing provisions of this Section 54.
----------

55. Attorneys' Fees and Legal Expenses. If either party commences any
----------------------------------
legal action or other proceeding to enforce any of the terms of this Lease
or any of the Operative Documents to which Lessor and Lessee are a party,
or because of any breach by the other party or dispute hereunder or
thereunder, the successful or prevailing party shall be entitled to recover
from the nonprevailing party all reasonable attorneys' fees and costs
incurred in connection therewith, whether or not such controversy, claim or
dispute is prosecuted to a final judgment.

B. AFFIRMATION OF STATUS OF ORIGINAL BUILDING LEASE

Except as amended by this Second Amendment, the Original Building Lease is
unchanged; and, as amended by this Second Amendment, the Original Building Lease
remains in full force and effect.

-28-
<PAGE>

IN WITNESS WHEREOF, all parties hereto have caused this Second Amendment to
be duly executed as of the date first set forth above.

LESSOR: CIBC INC., a Delaware corporation

By /s/ Tom R. Wagner
-------------------------------
Name: Tom R. Wagner
Title: Vice President

By
_______________________________
Name:
Title:

LESSEE: AMD INTERNATIONAL SALES & SERVICE,
LTD., a Delaware corporation

By /s/ Marvin D. Burkett
-------------------------------
Name: Marvin D.Burkett
Title: Sr. VP. CFO and Treasurer
<PAGE>

ACKNOWLEDGEMENT

STATE OF CALIFORNIA )
) ss
COUNTY OF SAN FRANCISCO )

On December 17, 1993, before me, Rhonda Allerhand, personally appeared Tom
R. Wagner, personally known to me (or proved to me on the basis of satisfactory
evidence) to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and
that by his signature on the instrument the person, or the entity upon behalf of
which the person acted, executed the instrument.

WITNESS my hand and official seal.

Signature: /s/ Rhoda Allerhand
----------------------------

(Seal)

STATE OF CALIFORNIA )
) ss
COUNTY OF SANTA CLARA )

On December 17, 1993, before me, Janis V. Cahill, personally appeared
Marvin Burkett, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the within
instrument and acknowledged to me that he executed the same in his authorized
capacity, and that by his signature on the instrument the person, or the entity
upon behalf of which the person acted, executed the instrument.

WITNESS my hand and official seal.

Signature: /s/ Janis V. Cahill
----------------------------

(Seal)
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.29H
<SEQUENCE>7
<DESCRIPTION>2ND AMT. TO LAND LEASE DATED 12/17/93.
<TEXT>

<PAGE>

Recording Requested By EXHIBIT 10.29(h)
and When Recorded, Return to:

Mayer, Brown & Platt
350 South Grand Avenue
25th Floor
Los Angeles, California 90071-1563
Attention: Leslie T. Tedrow
(213) 229-9500

________________________________________________________________________________
________________________________________________________________________________

SECOND AMENDMENT TO LAND LEASE

THIS SECOND AMENDMENT TO LAND LEASE (this "Second Amendment") is entered
----------------
into as of December 17, 1993 (the "Execution Date"), by and between CIBC INC., a
--------------
Delaware corporation ("Lessor"), and AMD INTERNATIONAL SALES & SERVICE, LTD., a
------
Delaware corporation ("Lessee").
------

RECITALS
--------

A. Pursuant to that certain Land Lease, by and between Lessor and Lessee
dated as of September 22, 1992 and recorded on September 22, 1992 as Instrument
No. 11550953 in the Official Records of the Recorder of Santa Clara County,
California, as amended by that certain First Amendment to Land Lease, dated as
of December 22, 1992 and recorded on January 5, 1993, as Instrument No. 11720033
in Official Records of the Recorder of Santa Clara County, California (such Land
Lease, as so amended, is referred to herein as the "Original Land Lease"),
-------------------
Lessor leases the Land described in Appendix 1 attached hereto to Lessee and
Lessee leases the Land from Lessor.

B. Lessor and Lessee desire to amend the Original Land Lease to
incorporate certain other changes and modifications that have been agreed to by
Lessor and Lessee.

C. Concurrently herewith, Lessor and Lessee also are amending that
certain Building Lease between Lessor and Lessee dated as of September 22, 1992
and recorded on September 22, 1992 as Instrument No. 11550954 in the Official
Records of the Recorder of Santa Clara County, California, as amended by a
certain First Amendment to Building Lease, dated as of December 22, 1992 and
recorded on January 5, 1993 in the Official Records of the Recorder of Santa
Clara County, California as Document No. 11720034.
<PAGE>

A. MODIFICATIONS TO LAND LEASE

Lessor and Lessee hereby amend the Original Land Lease as follows, and all
references in the Original Land Lease to "this Lease" or "the Lease" shall
hereafter refer to said Original Land Lease as amended hereby:

1. Fixed Term. In Section 1.2, the Expiration Date is hereby changed to
---------- -----------
December 22, 1995.

2. Lessor's Option to Renew. The following Section 1.3 is hereby
------------------------ -----------
inserted after Section 1.2:
-----------

1.3. Lessor's Option to Renew. If Lessee has not delivered to Lessor a
------------------------
written notice of Lessee's exercise of the Remarketing Option pursuant to
Section 41.6(A), Lessor may elect to renew the Fixed Term of this Lease for
---------------
an additional term of eight (8) years ending on the eighth anniversary date
of the Expiration Date by notifying Lessee in writing of such renewal at
least ninety (90) days, but not more than one hundred eighty (180) days,
prior to the Expiration Date. Such election shall be within the absolute
and sole discretion of Lessor, and nothing herein shall require Lessor to
renew or extend the Fixed Term of this Lease. Lessee acknowledges that
Lessor has not made any commitment, oral or written, to renew the Lease at
the end of the Fixed Term. Any such renewal shall be on the same terms and
conditions provided for in this Lease, or at the option of Lessor at the
then prevailing rates. In the event Lessor elects to extend the Fixed Term
as provided for above, Lessor shall also be required to extend the term of
the Building Lease for the same period. In connection with any such
renewal, Guarantor agrees to restate its Guaranty, in form and substance
mutually satisfactory to Lessor and to Guarantor, guaranteeing the Leases
during such renewal period. Nothing in this provision shall be construed to
limit Lessee's existing rights under this Lease, including Lessee's rights
to purchase the Land as provided for herein.

4. Definitions.
-----------

(a) The following definitions are hereby added to Section 2 in proper
---------
alphabetical sequence:

-2-
<PAGE>

Balance Due: means as of the date of determination an amount equal to
-----------
$13,046,583.86 reduced by any Qualified Payments to the extent that such
application is permitted pursuant to the definition of Qualified Payments.

Consent Agreement: means the Construction Consent Agreement dated as
-----------------
of December 22, 1992, by and between Lessor and Lessee.

Execution Date: the meaning specified in the preamble.
--------------

Lender: means Long-Term Credit Bank of Japan, Ltd., Los Angeles
------
Agency, and any other entity which provides financing to Lessor to
refinance its interests in this Lease.

Option Termination Date: the meaning specified in Section 41.1(b).
----------------------- ---------------

Purchase Option: the meaning specified in Section 41.1.
--------------- -------------

-3-
<PAGE>

any claims, (y) "Qualified Payments" shall not include any payment to
Lessor by Lender or a participant or Affiliate of or lender to Lessor that
is made to compensate Lessor for Lender's or such the participant's or
Affiliate's share of any costs, expenses, liabilities or losses which
Lessor may incur as a result of any of the events described in the
preceding Clauses (1) through (4) and (z) "Qualified Payments" shall not
----------- ---
include any payments received by Lessor that Lessor has paid to Lessee or
any other person for the restoration or repair of the Land or the Building
or that Lessor is holding as escrowed proceeds pursuant to Section 47. For
----------
purposes of computing the total Qualified Payments paid to or received by
Lessor as of any date, payments described in the preceding Clauses (1)
-----------
through (4) will be considered as escrowed proceeds pursuant to Section 47,
--- ----------
not Qualified Payments, until they are actually applied as Qualified
Payments by Lessor, which will generally not occur until the first
Installment Date which is at least three (3) Business Days after Lessor's
receipt of the same; and provided further, that all insurance proceeds in
connection with any damage to the Land or the Building as provided for in
Section 19 hereof (or in Section 19 of the Building Lease) or condemnation
---------- ----------
proceeds relating to a Taking as provided in Section 20 hereof (or in
----------
Section 20 of the Building Lease) shall remain escrowed proceeds pursuant
----------
to Section 47 hereof or in the Building Lease, as the case may be and shall
----------
not be payable to Lessee nor reduce the Balance Due until and except as
specifically provided for in Sections 19 and 20. All Qualified Payments
----------- --
received by Lessor in connection with either the Land or the Building shall
be first applied to reduce the "Balance Due" (as defined in the Building
Lease) under and pursuant to the Building Lease; and Qualified Payments
received by Lessor which are in excess of the "Balance Due" (as defined in
the Building Lease) under the Building Lease shall be applied to the
Balance Due hereunder.

Renovations: the meaning specified in the Building Lease.
-----------

Trustee: the meaning specified in Section 25.
------- ----------

(b) The definition of Building Lease is hereby deleted and replaced with
--------------
the following:

Building Lease: means that certain Building Lease entered into between
--------------
Lessor and Lessee on September 22, 1992 and recorded September 22, 1992 in
the Official Records of the Recorder of Santa Clara County, California as
Document No. 11550954, as amended by that certain First Amendment to
Building Lease dated as of December 22, 1992 and recorded

-4-
<PAGE>

January 5, 1993 in the Official Records of the Recorder of Santa Clara
County, California as Document No. 11720034, and as further amended by a
certain Second Amendment to Building, dated as of the date hereof, pursuant
to which Lessor financed the acquisition of certain improvements on the
Land.

(d) In the definition of Business Day, the following is hereby inserted
------------
immediately after "San Francisco, California" in the third line of such
definition: ", Los Angeles, California".

(e) The definition of Guaranty is hereby deleted and replaced with the
--------
following:

Guaranty: that certain Amended and Restated Guaranty, dated as of the
--------
date hereof, made by Guarantor in favor of Lessor.

(f) In the definition of Legal Requirement, (i) the following is hereby
-----------------
inserted immediately after the phrase "whether foreseen or unforeseen and
whether ordinary or extraordinary": "(including, without limitation, any zoning
or building laws or ordinances, any noise abatement, occupancy, or environmental
protection laws or regulations, or any rules, regulations or orders of any
governmental agency), or any building permit or any condition, privilege,
license, easement, right-of-way, covenant, restriction or grant (whether or not
of record)", and (ii) the following is hereby added in clause (b) immediately
after the phrase "foregoing impose obligations on": "Lessor, or".

(g) In the definition of Lessee's Equipment, the following is hereby
------------------
inserted immediately after the phrase "installed on or at the Land by Lessee or
any sublessee or assignee of Lessee, at its cost": "and not purchased with
funds advanced by Lessor".

(h) The definition of Lessor Purchase Price is hereby deleted in its
---------------------
entirety.

(i) The definition of Lessor's Review Charge is hereby deleted in its
----------------------
entirety.

(j) The definition of LIBO Rate is hereby deleted and replaced with the
---------
following:

LIBO Rate: means with respect to any Quarterly Period, an interest
---------
rate per annum equal at all times during such Quarterly Period to the rate
of interest per annum (rounded

-5-
<PAGE>

upwards, if necessary, to the next 1/16 of 1%) at which deposits (in an
amount equal to the Balance Due as of the first day of any Quarterly
Period) in United States dollars in immediately available funds are offered
or are available to Lessor's LIBOR Office in the eurodollar interbank
market at 10:00 a.m. (Pacific Standard Time) two Business Days before the
first day of such Quarterly Period for a three (3) month period; provided,
however, that if Lessee shall notify Lessor not less than four (4) Business
Days prior to the first day of any Quarterly Period (except the second
Quarterly Period in which a six (6) month LIBO Rate is already in effect)
that Lessee desires that the LIBO Rate for such Quarterly Period and the
succeeding Quarterly Period be based on a six (6) month period, then the
LIBO Rate with respect to such two (2) Quarterly Periods shall be an
interest rate per annum (rounded upwards, if necessary, to the next 1/16 of
1%) equal at all times during such two (2) Quarterly Periods to the rate of
interest at which deposits (in an amount equal to the Balance Due as of the
first day of the first of such two (2) Quarterly Periods) in United States
dollars in immediately available funds are offered or are available to
Lessor's LIBOR Office in the Eurobank interbank market at 10:00 a.m.
(Pacific Standard Time) two (2) Business Days before the first day of the
first of such two (2) Quarterly Periods for such six (6) month period.
Lessee may not elect a six (6) month LIBO Rate with respect to any
Quarterly Period expiring during the period beginning on the date hereof
and ending on the first Installment Date after the earlier of (i) the
Funding Termination Date (as that term is defined in the Building Lease),
and (ii) the earliest date on which the Funded Amount equals the Maximum
Advance Amount (as that term is defined in the Building Lease). If Lessor
is unable to determine the LIBO Rate at any time, or Lessor shall determine
that the introduction of any change in or in the interpretation of any law
makes it unlawful, or any central bank or other governmental authority
asserts that it is unlawful for Lessor to calculate rent based on the LIBO
Rate, then the LIBO Rate for the applicable Quarterly Period shall be the
Corporate Base Rate.

(k) The definition of LIBO Rent is hereby deleted and replaced with the
---------
following:

LIBO Rent: as of an Installment Date means:
---------

-6-
<PAGE>

(b) with respect to each Quarterly Period commencing after the date
hereof, the Balance Due as of such Installment Date multiplied by an
interest rate per annum equal at all times to the sum of (a) 1% plus (b)
the rate obtained by dividing the LIBO Rate (or the Corporate Base Rate if
required pursuant to the terms set forth under the definition of "LIBO
Rate") by a percentage equal to 100% minus the LIBO Reserve Percentage,
dividing the sum thereof by 360 and multiplying the result thereof by the
number of actual days elapsed (including such Installment Date) in the
Quarterly Period that includes such Installment Date.

(l) The definition of Operative Agreements is hereby deleted and replaced
--------------------
with the following:

Operative Agreements: (i) this Lease, (ii) the Building Lease, (iii)
--------------------
the Guaranty, (iv) that certain Purchase and Sale Agreement, dated as of
April 15, 1992, between American Telephone and Telegraph Company, as
seller, and Guarantor, as buyer, as amended by that certain First Amendment
to Purchase and Sale Agreement dated as of August 10, 1992, and as further
amended by that certain Second Amendment to Purchase and Sale Agreement
dated as of September 17, 1992, (v) that certain Restated Hazardous
Materials Undertaking and Unsecured Indemnity, dated as of the date hereof,
by Lessee and Guarantor in favor of Lessor, (vi) that certain Assignment of
Purchase and Sale Agreement dated as of September 21, 1992, made by
Guarantor in favor of Lessor, (vii) that certain agreement, dated as of

-7-
<PAGE>

September 21, 1992, between American Telephone and Telegraph Company and
Lessee, (viii) that certain Consent to Assignment of Purchase and Sale
Agreement, dated as of September 21, 1992, made by American Telephone and
Telegraph Company in favor of Lessor and Guarantor, (ix) the Consent
Agreement, (x) the Letter Agreement (as defined in the Building Lease), and
(xi) any and all other documents executed by Lessee or Guarantor or any
Affiliate of either thereof in connection with any of the foregoing.

(m) The term "Casualty Termination Price" is hereby changed to "Casualty
-------------------------- --------
Value Payment". All references in the Original Land Lease to "Casualty
- - -------------
Termination Price" are hereby changed to "Casualty Value Payment".

(n) The term "Taking Termination Price" is hereby changed to "Taking Value
------------------------ ------------
Payment." All references in the Original Land Lease to "Taking Termination
- - -------
Price" are hereby changed to "Taking Value Payment".

(o) In the definition of Restoration, the phrase "of the Building Lease"
-----------
is hereby inserted after "Section 8".
---------

6. (a) Basic Rent. Section 3.1 is deleted in its entirety and replaced
---------- -----------
with the following language:

Basic Rent. Lessee will pay to Lessor Basic Rent by no later than 12:00
----------
Noon (Los Angeles time) on each Installment Date. For purposes of this
Lease, Basic Rent shall mean, as of an Installment Date, an amount equal to
the sum of (i) LIBO Rent plus (ii) Capital Rent.

(b) Additional Rent. In Section 4, (i) the following is hereby inserted at
--------------- ---------
the end of clause (a), immediately preceding clause (b): "including, without
limitation, the amounts required to be paid by Lessee to Lessor pursuant to

Section 41.6 (J)," and (ii) the reference to subdivision (b) of Section 25.1 in
- - ------------ ------------
the parenthetical in the second sentence is hereby changed to subdivision (c) of

Section 25.1. The following is hereby inserted at the end of Section 4:
- - ------------ ---------

"On April 22, 1994, Lessee shall pay (by check or other method of
payment acceptable to Lessor and Lessee) to Lessor an amount equal to
One Dollar ($1.00), which amount shall be applied against the Balance
Due as of such date. On May 22, 1994, Lessor shall pay (by check or
other method of payment acceptable to Lessor and Lessee) to Lessee an
amount equal to One Dollar ($1.00), which amount shall be added to the
Balance Due as of such date. The payments set forth in this
grammatical paragraph of Section 4 shall not in any way
---------

-8-
<PAGE>

affect the calculation of Basic Rent or any other sums due under this
Lease."

7. Net Lease; No Counterclaim, Abatement, etc. In Section 5, (i) the word
------------------------------------------- ---------
"fully" is hereby inserted preceding "net lease" in the first sentence, (ii) the
phrase ", including, without limitation, the construction or financing of any
improvements thereon including the Renovations" is hereby inserted at the end of
the first sentence after "thereof", and (iii) the phrase "or construction of
renovations upon" is hereby inserted in clause (g) after "use of".
----------

8. Alterations. The text of Section 8 is hereby deleted and replaced with
----------- ---------
the following:

Except as permitted under the Building Lease, Lessee shall not have
the right to make any improvements or additions (collectively, the
"Alterations") to the Land at any time during the term of this Lease.
-----------

10. Payment of Taxes, etc. Section 14 is hereby modified as follows:
---------------------- ----------

(a) Clause (a) is hereby deleted and replaced with the following:

-9-
<PAGE>

the Land; (ii) all transfer, sales, recording, value added, use and
similar taxes at any time levied, assessed or payable on account of
the acquisition, occupancy, operation, possession, leasing,
subleasing, construction, repair, rebuilding or use of the Land; (iii)
all taxes, assessments, levies, charges, fees, rents or payments in
lieu of, or as a substitute for, those payments referred to in clauses
(i) and (ii) above or any part thereof, whether or not expressly so
designated; and (iv) all other taxes imposed on, with respect to, or
in connection with the Operative Agreements and the transactions
contemplated thereby, including any sale of the Land pursuant to
Section 41 (all of the foregoing being referred to collectively as
----------
"Taxes"). The foregoing requirements of this Section 14(a) are subject
----- -------------
to Lessee's rights under Section 17 hereof. If any such Taxes may
----------
legally be paid in installments, Lessee may pay such Taxes in the
installments due; provided, however, that in such event, Lessee shall
pay all remaining installments (whether or not then due) prior to the
expiration of this Lease or upon termination of this Lease, except if
such expiration occurs as a result of Lessee purchasing the Land
pursuant to Section 41 hereof.
----------

(b) In clause (b), item (iii) is hereby deleted, and item (iv) shall
------------- ---------- ---------
now become item (iii).
----------

12. Permitted Contests. In Section 17, insert the following in the first
------------------ ----------
sentence after the phrase "suppliers or vendors or lien therefor,": "or the
claims of any other Person affecting the Land or the Building (or any part
thereof) or any Lien therefor,"

13. Risks To Be Insured. In Section 18.1, the reference in clause (x) to
------------------- ------------
Lessor Purchase Price is hereby changed to Balance Due.

14. Total Destruction. In Section 19.3, all references to the term
----------------- ------------
"Casualty Termination Price" are hereby changed to "Casualty Value Payment".
All references to "Lessor Purchase Price" are hereby changed to "Balance Due".

-10-
<PAGE>

Payments and shall be applied to reduce the Balance Due (to the extent so
provided under the definition of `Qualified Payments')". In Clause (b), the
phrase "payment of the purchase price" is hereby changed to "the Taking Value
Payment".

17. Right of Lessor to Perform Lessee's Covenants, Etc. In Section 23,
-------------------------------------------------- -----------
the following is inserted immediately after the phrase "perform any act" in the
first sentence: "(including without limitation completion of the Renovations)."

18. Assignments, Subleases, Etc. by Lessee. In Section 24.1, the second
-------------------------------------- -------------
sentence shall end "operation of law or otherwise"; and the remainder of such
sentence is hereby deleted.

20. Trustee; Power of Sale. In Section 26, all references to "Lessor
---------------------- ----------
Purchase Price" are hereby changed to "Balance Due." The reference to
"Continental Lawyers Title Company" in Section 26 is hereby changed to "Lawyers
----------
Title Insurance Company."

21. Further Assurance for Lessee's Obligations. All references in Section
------------------------------------------ -------
27 to the "Lessor Purchase Price" are hereby changed to the "Balance Due".
- - --

22. End of Lease Term. In Section 37, the phrase "and subject to the
----------------- ----------
Obligations of Lessee as provided for at Section 41" is hereby inserted after
----------
"termination of this Lease" in the first sentence.

23. Purchase and Remarketing of Land. In Section 41, the phrase "payment
-------------------------------- ----------
of the Balance Due and the" is hereby inserted immediately preceding the phrase
"purchase and sale".

24. Lessee's Option to Purchase. Section 41.1(a) is hereby deleted and
--------------------------- ---------------
replaced with the following:

-11-
<PAGE>

convey to Lessee, and Lessee shall purchase from Lessor, Lessor's interest
in the Land. The purchase price to be paid by Lessee for the Land shall be
an amount equal to the Balance Due as of the closing date of Lessee's
purchase of the Land. As a condition to Lessor's obligations hereunder,
Lessee shall also pay to Lessor all Basic Rent, Additional Rent and other
amounts that may have accrued as of such date.

25. Purchase. Section 41.2 is hereby deleted and replaced with the
-------- ------------
following:

41.2 Expiration Date Obligation to Pay and Purchase. Unless Lessee
----------------------------------------------
shall have exercised the Purchase Option, then, subject to the terms,
conditions and provisions set forth in this Section 41, Lessee shall be
----------
required to purchase all of Lessor's interest in the Land and pay to Lessor
the Balance Due as of the Expiration Date along with all accrued Basic
Rent, Additional Rent and other amounts then due. Upon receipt of such
amount, Lessee shall be deemed to have purchased from Lessor, and Lessor
shall convey to Lessee, on the Expiration Date all of Lessor's interest in
the Land. Lessee acknowledges that under Section 41 of the Building Lease,
----------
Lessee shall be obligated to pay the Balance Due (as defined in the
Building Lease) under the Building Lease and purchase the Building
simultaneously with the purchase of the Land. Lessee may designate, in a
notice given to Lessor not less than ten (10) days prior to the closing of
such purchase (time being of the essence), a transferee to whom the
conveyance shall be made (if other than to Lessee), in which case such
conveyance shall (subject to the terms and conditions set forth herein) be
made to such designee; provided, however, that such designation of a
--------
transferee shall not cause Lessee to be released, fully or partially, from
any of its obligations under this Lease, including without limitation its
obligation to pay the Balance Due on the Expiration Date and all other
accrued amounts.

26. Acceleration of Purchase Obligation. Section 41.3 is hereby deleted
----------------------------------- ------------
and replaced with the following:

41.3 Acceleration of Expiration Date Obligation. Lessee shall be
------------------------------------------
obligated to purchase Lessor's interest in the Land and pay to Lessor the
Balance Due along with all amounts which have accrued and are due and
payable hereunder immediately upon the occurrence of any Event of Default
specified in clauses (k) or (l) of Section 25.1. Further, notwithstanding
------------
anything contained herein to the contrary, at any time upon the occurrence
and during the continuance of an Event of Default, if Lessor gives Lessee a
notice

-12-
<PAGE>

under Section 25.2(a)(i) terminating Lessee's right of possession (for
------------------
purposes of this Section 41 such notice being referred to as a "Purchase
---------- --------
Acceleration Notice"), Lessee shall be obligated to purchase Lessor's
-------------------
interest in the Land and to pay to Lessor the Balance Due along with all
amounts which have accrued and are payable hereunder on the date which is
ten (10) business days following Lessee's receipt of such Purchase
Acceleration Notice. If Lessee's obligations under this Section 41.3 take
place on a date other than an Installment Date, Basic Rent shall be
prorated to such date. Lessee acknowledges that its receipt of a Purchase
Acceleration Notice under this Section 41.3 shall also constitute a receipt
------------
by Lessee of a Purchase Acceleration Notice under the Building Lease. The
Lessor's right to terminate the Purchase Option pursuant to Section 41.1
------------
and to accelerate the purchase of the Lessor's interest in the Land are
independent of each other, and notwithstanding anything in Section 41.1 to
------------
the contrary, unless the Option Termination Date shall have first occurred,
the Purchase Option shall terminate and be of no further force or effect on
the date that any Purchase Acceleration Notice is given.

If Lessee fails to purchase Lessor's interest in the Land and pay the
Balance Due along with all other amounts as provided for in the preceding
paragraph on the tenth (10th) Business Day following Lessee's receipt of
the Purchase Acceleration Notice, then, Lessor shall be free to sell the
Land to another Person and upon any such subsequent sale to any other
Person by Lessor of Lessor's interest in the Land, Lessor shall be entitled
to recover from Lessee, and Lessee shall upon demand pay to Lessor, an
amount equal to (i) the Balance Due, plus (ii) the amount of all Basic
----
Rent, Additional Rent and other sums payable hereunder to and including the
date of such demand (including, without limitation, Breakage Amounts and
all costs and expenses incurred by Lessor in effectuating its remedies and
making such sale or sales), minus (iii) the amount of all consideration (on
-----
a present value basis determined by the application of a discount factor
(per annum) equal to five percent (5%) to the extent such consideration is
not cash), received by Lessor in connection with such sale.

27. Determination of the Purchase Price. In Section 41.4, (a) such
----------------------------------- ------------
Section shall hereafter be entitled "Breakage"; (b) the first grammatical
--------
paragraph is hereby deleted; (c) the remainder of said Section is hereby deleted
and replaced with the following:

In addition to all other amounts owed to Lessor hereunder, if Lessee's
payment of the Balance Due and

-13-
<PAGE>

purchase of Lessor's interest in the Land occurs on a date other than the
LIBO Last Day (defined below), and if the LIBO Rate for the three (3) month
period commencing on the date on which the Balance Due is paid is less than
the LIBO Rate in effect during the Quarterly Period in which such payment
occurs, then Lessee shall pay to Lessor on such date as an additional
component of the Balance Due, the Breakage Amount (defined below). If
Lessee's payment of the Balance Due occurs when a six (6) month LIBO Rate
is in effect and on a date other than the second Installment Date of such
period, the Breakage Amount shall be an amount equal to the present value
of the difference between (A) the portion of the Basic Rent payments for
----------
the two (2) Quarterly Periods for which such six (6) month LIBO Rate
applies (prorated for the number of days in the period beginning on the
date of such purchase and ending on the second Installment Date occurring
in such six (6) month period with respect to which such six (6) month LIBO
Rate applies), and (B) an amount equal to what the portion of the Basic
Rent for such two Quarterly Periods (prorated for the number of days in the
period beginning on the date on which such purchase occurs and ending on
the second Installment Date occurring in such six (6) month period with
respect to which such six (6) month LIBO Rate applies) would have been had
the Basic Rent for such two (2) Quarterly Periods been calculated using the
three (3) month LIBO Rate in effect on the date of such purchase. If
Lessee's payment of the Balance Due occurs when a three (3) month LIBO Rate
is in effect on other than the last day of a Quarterly Period, the Breakage
Amount shall be an amount equal to the present value of the difference
----------
between (A) the portion of the Basic Rent payment for such Quarterly Period
in which such purchase occurs (prorated for the number of days during the
period beginning on the date of such purchase and ending on Installment
Date at the end of such Quarterly Period) and (B) an amount equal to what
the portion of the Basic Rent payment for such Quarterly Period (prorated
for the number of days in the period beginning on the date of such purchase
and ending on the Installment Date at the end of such Quarterly period)
would have been had the Basic Rent for such Quarterly Period been
calculated using a three (3) month LIBO Rate in effect on the date of such
purchase. In either case, such difference shall be discounted at a rate of
5% per annum. If any statute or rule of law shall validly limit the amount
due under this Section 41.4 to less than the amount above agreed upon,
------------
Lessor or Assignee shall be entitled to the maximum amount allowable under
such statute or rule of law.

28. Purchase Procedure. In Section 41.5, (a) the phrase "purchase price
------------------ ------------
therefor" in the first paragraph is hereby deleted and replaced with "Balance
Due (and all other amounts due

-14-
<PAGE>

and owing hereunder)"; (b) in the second grammatical paragraph, the first
sentence shall begin as follows: "If Lessee shall purchase Lessor's interest in
the Land pursuant to Section 41.1(b) or if Lessee's obligation to pay the
---------------
Balance Due and purchase the Land is accelerated pursuant to Section 41.3,
------------
Lessee shall deliver the Balance Due to Lessor together with ..."; and (c) the
following is hereby inserted at the end of the parenthetical in the penultimate
sentence in such second grammatical paragraph: "and pay to Lessor the Balance
Due along with all other amounts due and owing hereunder".

29. Option to Remarket. The second grammatical paragraph of Section 41.6
------------------ ------------
is hereby deleted and replaced with the following:

The reference in subparagraph L to "Lessor Purchase Price" is hereby
deleted and replaced with "Balance Due and all other amounts due and owing
hereunder".

The parenthetical and succeeding phrase "within ten (10) business days" in
subparagraph M is hereby deleted and replaced with the following: "(and Lessee
shall be obligated to purchase the Land and pay to Lessor the Balance Due
together with all other amounts due and owing hereunder pursuant to Section
-------
41.2) within five (5) business days".
- - ----

-15-
<PAGE>

30. The following Sections are hereby inserted after Section 50 (and the
----------
subsequent Sections are hereby renumbered accordingly).

51. Additional Waivers. IN CONNECTION WITH THE TRANSACTIONS PROVIDED
------------------
FOR HEREIN AND AS FURTHER CONSIDERATION FOR LESSOR AGREEING TO ENTER INTO
THIS SECOND AMENDMENT LESSEE WAIVES TO THE MAXIMUM EXTENT SUCH WAIVER IS
PERMITTED BY LAW, ANY AND ALL DEFENSES ARISING DIRECTLY OR INDIRECTLY UNDER
ANY ONE OR MORE OF CALIFORNIA CIVIL CODE (S)(S) 1951.2, 2808, 2809, 2810,
2815, 2819, 2820, 2821, 2838, 2839, 2845, 2848, 2849, AND 2850 TO THE
EXTENT APPLICABLE, CALIFORNIA CODE OF CIVIL PROCEDURE (S)(S) 580A, 580B,
580C, 580D AND 726, AND, TO THE EXTENT APPLICABLE, CHAPTER 2, TITLE 14,
PART IV OF THE CALIFORNIA CIVIL CODE.

52. Lessee Further Acknowledgments. Lessee has been represented by
------------------------------
legal and tax counsel, independent accountants and other professionals,
each of which has been personally selected by Lessee, as Lessee has found
necessary to consult concerning the consummation of the transactions
contemplated in this Lease and the other Operative Agreements, and such
representation has included an examination and analysis of Lessee's rights
and obligations and the basis of all accounting, tax, financial and legal
aspects and treatment under this Lease and the other Operative Agreements.
With respect to the accounting, tax, financial and legal consequences of
the transactions contemplated herein and in the Operative Agreements,
Lessee is relying solely upon the advice of its own tax, accounting and
legal advisors and upon its knowledge with respect thereto.

53. Certain Tax Matters. Without limiting the acknowledgements made by
-------------------
Lessee at Section 52, Lessor and Lessee agree that, in accordance with
----------
their intentions and the substance of the transactions contemplated hereby
and to the extent permitted by law, Lessee (and not Lessor) shall be
treated as the owner of the Land for Federal, state, and local income tax
purposes. Lessee shall be entitled to take any deduction, credit allowance
or other reporting, filing or other tax position consistent with such
characterizations. Lessor shall not file any Federal, state or local income
tax returns, reports or other statements in a manner which is inconsistent
with the foregoing provisions of this Section 53.
----------
54. Attorneys' Fees and Legal Expenses. If either party commences any
----------------------------------
legal action or other proceeding to enforce any of the terms of this Lease
or any of the Operative Documents to which Lessor and Lessee are a party,

-16-
<PAGE>

or because of any breach by the other party or dispute hereunder or
thereunder, the successful or prevailing party shall be entitled to recover
from the nonprevailing party all reasonable attorneys' fees and costs
incurred in connection therewith, whether or not such controversy, claim or
dispute is prosecuted to a final judgment.

B. AFFIRMATION OF STATUS OF ORIGINAL LAND LEASE

Except as amended by this Second Amendment, the Original Land Lease is
unchanged; and, as amended by this Second Amendment, the Original Land Lease
remains in full force and effect.

IN WITNESS WHEREOF, all parties hereto have caused this Second Amendment to
be duly executed as of the date first set forth above.

LESSOR: CIBC INC., a Delaware corporation

By /s/ Tom R. Wagner
------------------------------
Name: Tom R. Wagner
Title: Vice President

By
______________________________
Name:
Title:

LESSEE: AMD INTERNATIONAL SALES & SERVICE,
LTD., a Delaware corporation

By /s/ Marvin D. Burkett
------------------------------
Name: Marvin Burkett
Title: Sr. VP, CFO and Treasurer

-17-
<PAGE>

ACKNOWLEDGEMENT

STATE OF CALIFORNIA )
) ss
COUNTY OF SAN FRANCISCO )

On December 17, 1993, before me, Rhoda Allerhand, personally appeared Tom
R. Wagner, personally known to me (or proved to me on the basis of satisfactory
evidence) to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and
that by his signature on the instrument the person, or the entity upon behalf of
which the person acted, executed the instrument.

WITNESS my hand and official seal.

Signature: /s/ Rhoda Allerhand
--------------------------------

(Seal)

STATE OF CALIFORNIA )
) ss
COUNTY OF SANTA CLARA )

WITNESS my hand and official seal.

Signature: /s/ Janis V. Cahill
-----------------------------

(Seal)

-18-
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.30
<SEQUENCE>8
<DESCRIPTION>EXECUTIVE SAVINGS PLAN, AS AMENDED.
<TEXT>

<PAGE>

EXHIBIT 10.30

ADVANCED MICRO DEVICES

EXECUTIVE SAVINGS PLAN

(AMENDMENT AND RESTATEMENT EFFECTIVE AS OF AUGUST 1, 1993)
<PAGE>

ADVANCED MICRO DEVICES
EXECUTIVE SAVINGS PLAN

TABLE OF CONTENTS
-----------------

ARTICLE I
<S> <C> <C>
TITLE AND DEFINITIONS......................... 1
1.1 Title.......................................................... 1
-----
1.2 Definitions.................................................... 1
-----------

ARTICLE II
PARTICIPATION............................. 4
2.1 Participation.................................................. 4
-------------

ARTICLE III
DEFERRAL ELECTIONS......................... 4
3.1 Elections to Defer Compensation................................ 4
-------------------------------
3.2 Investment Elections........................................... 5
--------------------

ARTICLE IV
PARTICIPANT ACCOUNTS........................ 6
4.1 Deferral Account............................................... 6
----------------
4.2 Company Matching Account....................................... 7
------------------------

ARTICLE V
VESTING.............................. 8
5.1 Deferral Account............................................... 8
----------------
5.2 Company Matching Account....................................... 8
------------------------

ARTICLE VI
DISTRIBUTIONS........................... 8
6.1 Amount and Time of Distribution................................ 8
-------------------------------
6.2 Form of Distribution........................................... 8
--------------------
6.3 Termination of Participation................................... 9
----------------------------

ARTICLE VII
PARTICIPANT LOANS......................... 9
7.1 Hardship Loans to Participants................................. 9
------------------------------

ARTICLE VIII
ADMINISTRATION........................... 10
8.1 Committee Action............................................... 10
----------------
8.2 Powers and Duties of the Committee............................. 10
----------------------------------
8.3 Construction and Interpretation................................ 11
-------------------------------
8.4 Information.................................................... 11
-----------
8.5 Compensation, Expenses and Indemnity........................... 12
------------------------------------
8.6 Quarterly Statements........................................... 12
--------------------

ARTICLE IX
MISCELLANEOUS........................... 12
9.1 Unsecured General Creditor..................................... 12
--------------------------
9.2 Restriction Against Assignment................................. 13
------------------------------
</TABLE>

i
<PAGE>

<TABLE>

<S> <C> <C>
9.3 Withholding.................................................... 13
-----------
9.4 Amendment, Modification, Suspension or Termination............. 13
--------------------------------------------------
9.5 Governing Law.................................................. 13
-------------
9.6 Receipt or Release............................................. 13
------------------
9.7 Headings, etc. Not Part of Agreement........................... 14
------------------------------------
9.8 Limitation on Participants' Rights............................. 14
----------------------------------

ARTICLE X
BENEFIT OFFSET........................... 14
10.1 Offset for Certain Benefits Payable Under Split-
------------------------------------------------
Dollar Life Insurance Policies................................. 14
------------------------------
</TABLE>

ii
<PAGE>

ADVANCED MICRO DEVICES
EXECUTIVE SAVINGS PLAN
(AMENDMENT AND RESTATEMENT EFFECTIVE AS OF AUGUST 1, 1993)

WHEREAS, ADVANCED MICRO DEVICES, INC. (the "Company") has established
the Advanced Micro Devices Executive Savings Plan (the "Plan") effective as of
August 1, 1993;

WHEREAS, it is desirable to amend and restate the Plan;

NOW, THEREFORE, the Plan is hereby amended in its entirety and
restated, effective as of August 1, 1993, as follows:

ARTICLE I
TITLE AND DEFINITIONS

1.1 Title.
-----

This Plan shall be known as the Advanced Micro Devices Executive
Savings Plan.

1.2 Definitions.
-----------

Whenever the following words and phrases are used in this Plan, with
the first letter capitalized, they shall have the meanings specified below.

"Account" or "Accounts" shall mean a Participant's Deferral Account
and/or Company Matching Account.

"Beneficiary" means the person or persons, including a trustee,
personal representative or other fiduciary, last designated in writing by a
Participant and filed with the Committee in accordance with procedures
established by the Committee to receive the benefits specified hereunder in the
event of the Participant's death. If there is no valid Beneficiary designation
in effect, or if there is no surviving designated Beneficiary, then the
Participant's surviving spouse shall be the Beneficiary. If there is no
surviving spouse to receive any benefits payable in accordance with the
preceding sentence, the duly appointed and currently acting personal
representative of the Participant's estate (which shall include either the
Participant's probate estate or living trust) shall be the Beneficiary. In any
case where there is no such personal representative of the Participant's estate
duly appointed and acting in that capacity within 90 days after the
Participant's death (or such extended period as the Committee determines is
reasonably necessary to allow such personal representative to be appointed, but
not to exceed 180 days after the Participant's death), then Beneficiary shall
mean the person or persons who can verify by affidavit or court order to the
satisfaction of the Committee that they are legally entitled to receive the
benefits

1
<PAGE>

specified hereunder. In the event any amount is payable under the Plan to a
minor, payment shall not be made to the minor, but instead be paid (a) to that
person's living parent(s) to act as custodian, (b) if that person's parents are
then divorced, and one parent is the sole custodial parent, to such custodial
parent, or (c) if no parent of that person is then living, to a custodian
selected by the Committee to hold the funds for the minor under the Uniform
Transfers or Gifts to Minors Act in effect in the jurisdiction in which the
minor resides. If no parent is living and the Committee decides not to select
another custodian to hold the funds for the minor, then payment shall be made to
the duly appointed and currently acting guardian of the estate for the minor or,
if no guardian of the estate for the minor is duly appointed and currently
acting within 60 days after the date the amount becomes payable, payment shall
be deposited with the court having jurisdiction over the estate of the minor.

"Board of Directors" or "Board" shall mean the Board of Directors of
the Company.

"Bonus" shall mean any incentive compensation, excluding commissions,
payable to a Participant in addition to the Participant's salary.

"Code" shall mean the Internal Revenue Code of 1986, as amended.

"Committee" shall mean the Retirement Savings Plan Administrative
Committee.

"Company" shall mean Advanced Micro Devices, any successor corporation
and each corporation which is a member of a controlled group of corporations
(within the meaning of Section 1563(a) of the Code, determined without regard to
Section 1563(a)(4) and (e) (3) (C) thereof and by substituting the phrase "at
least 50 percent" for the phrase "at least 80 percent" each time it appears in
Section 1563 (a) (1)) of which Advanced Micro Devices is a component member.

"Company Matching Account" shall mean the bookkeeping account
maintained by the Committee for each Participant that is credited with an amount
equal to 50% of a Participant's Salary Deferrals (subject to certain
limitations) and interest pursuant to Section 4.2.

"Compensation" shall mean the Salary, commissions and Bonus that the
Participant is entitled to for services rendered to the Company.

"Deferral Account" shall mean the bookkeeping account maintained by
the Committee for each Participant that is credited with amounts equal to (1)
the portion of the Participant's Salary and/or commissions that he elects to
defer, (2) the portion of

2
<PAGE>

the Participant's Bonus that he elects to defer, and (3) interest pursuant to
Section 4.1.

"Effective Date" shall mean August 1, 1993.

"Election Date" shall mean December 15 or such earlier date as is
specified by the Committee and communicated to the Participant with at least
thirty (30) days advance notice.

"Eligible Employee" shall mean each employee of the Company who is at
or above the level of director.

"Fiscal Year" shall mean the fiscal year of the Company.

"Fund" or "Funds" shall mean one or more of the mutual funds or
contracts selected by the Committee pursuant to Section 3.2(b).

"Initial Election Period" for an Eligible Employee shall mean the 30-
day period following the later of July 31, 1993 or the date the employee becomes
an Eligible Employee.

"Interest Rate" shall mean, for each Fund, an amount equal to the
gross rate of gain or loss on the assets of such Fund during the month (1)
reduced by administrative and investment fees charged to investors in such Fund
during the month and (2) further reduced by one-twelfth (1/12th) of one
percentage point.

"Loan Account" shall mean the bookkeeping account maintained by the
Committee for each Participant who obtains a hardship loan from the Committee in
accordance with Article VII that is credited with (1) an amount equal to the
amount of the loan and (2) interest pursuant to Section 7.1(d).

"Participant" shall mean any Eligible Employee who elects to defer
Compensation in accordance with Section 3.1.

"Payment Eligibility Date" shall mean the first day of the month
following the end of the fiscal quarter following the fiscal quarter in which a
Participant terminates employment or dies.

"Plan" shall mean the Advanced Micro Devices Executive Savings Plan
set forth herein, now in effect, or as amended from time to time.

"Plan Year" shall mean the 12 consecutive month `period beginning on
January 1 each year, except that the first Plan Year shall be a short Plan Year
beginning on August 1, 1993 and ending on December 31, 1993.

"Salary" shall mean the Participant's base pay.

3
<PAGE>

"Tax Adjustment Factor" shall mean a number, determined by the
Committee, which is equal to one minus the sum of (1) the highest marginal
federal personal income tax rate then in effect and (2) the effective highest
marginal state income tax rate in the state in which the Participant resides,
net after the effect of the deduction for such state income tax for federal
income tax purposes.

ARTICLE II
PARTICIPATION

2.1 Participation.
-------------

An Eligible Employee shall become a Participant in the Plan by
electing to defer all or a portion of his or her Compensation in accordance with
Section 3.1.

ARTICLE III
DEFERRAL ELECTIONS

3.1 Elections to Defer Compensation.
-------------------------------

(a) General Rule. The amount of Compensation which an Eligible
-------------
Employee may elect to defer is as follows:

(1) Any percentage of Salary up to 50%, provided that such
Eligible Employee's Salary is not reduced to an amount less than the Social
Security wage base for the plan year; plus

(2) Any percentage or dollar amount of Bonus and commissions up
to 100%.

(b) Initial Election. Each Eligible Employee may elect to defer
----------------
Compensation by filing with the Committee an election, on a form provided by the
Committee, no later than the last day of his or her Initial Election Period. An
election to defer Compensation during an Initial Election Period shall be
irrevocable and shall be effective with respect to Salary and commissions earned
during the first pay period beginning after the later of August 1, 1993, or the
date of the election, and to each Bonus the amount of which first becomes fixed
and determinable after the date of the election; provided, however, that,
effective as of January 1, 1995, the initial election will apply to any Bonus
payable for a Fiscal Year, or for a performance period ending with the close of
a Fiscal Year, only if such election is made on or before June 30 of such Fiscal
Year.

(c) Elections other than Elections during the Initial Election
----------------------------------------------------------
Period. Any Eligible Employee who fails to elect to defer Compensation during
- - -------
his or her Initial Election Period may subsequently become a Participant, and
any Eligible Employee who

4
<PAGE>

has terminated a prior Salary, commissions or Bonus deferral election may elect
to again defer Salary, commissions or Bonuses or any combination thereof, by
filing an appropriate election, on a form provided by the Committee, to defer
Compensation. An election to defer Salary and/or commissions must be filed on
or before the Election Date and will be effective for Salary and/or commissions
earned during pay periods beginning after the following December 25. An
election to defer a portion of each Bonus for a Fiscal Year must be filed on or
before the Election Date preceding the date the Bonus first becomes fixed and
determinable; provided, however, that, effective as of January 1, 1995, an
election to defer a Bonus for a Fiscal Year, or for a performance period ending
with the close of a Fiscal Year, must be made on or before June 30 of such
Fiscal Year.

(d) Duration of Salary Deferral Election. Any Salary deferral
------------------------------------
election made under paragraph (b) or paragraph (c) of this Section 3.1 shall
remain in effect, notwithstanding any change in the Participant's Salary, until
changed or terminated in accordance with the terms of this paragraph (d);
provided, however, that such election shall terminate for Salary or commissions
paid while the Participant is not an Eligible Employee. A Participant may
increase, decrease or terminate his or her Salary and/or commission deferral
election, effective for Salary and/or commissions earned during pay periods
beginning after any December 25, by filing a new election, in accordance with
the terms of this Section 3.1, with the Committee on or before the preceding
Election Date.

(e) Duration of Bonus Deferral Election. Any Bonus deferral election
-----------------------------------
made under paragraph (b) or paragraph (c) of this Section 3.1 shall be
irrevocable and shall apply only to the Bonus or Bonuses payable with respect to
services performed during the Fiscal Year or the performance period ending with
the close of such Fiscal Year, for which the election is made. For each
subsequent Fiscal Year, or performance period ending with the close of any
subsequent Fiscal Year, an Eligible Employee may make a new election to defer a
percentage of each of his or her Bonuses for that Fiscal Year. Such election
shall be on forms provided by the Committee and shall be made on or before the
Election Date of the Fiscal Year preceding the Fiscal Year in which the Bonus
otherwise would be paid. Notwithstanding the foregoing, effective as of January
1, 1995, the election to defer a Bonus for a Fiscal Year, or for a performance
period ending with the close of a Fiscal Year, must be made on or before June 30
of such Fiscal Year.

3.2 Investment Elections.
--------------------

(a) At the time of making the deferral elections described in Section
3.1, the Participant shall designate, on a form provided by the Committee, which
of the types of mutual funds or contracts the Participant's Accounts will be
deemed to be invested in for purposes of determining the amount of earnings

5
<PAGE>

to be credited to those Accounts. In making the designation pursuant to this
Section 3.2, the Participant may specify that all or any 10% multiple of the
aggregate of his Accounts be deemed to be invested in one or more of the types
of mutual funds or contracts available. Effective as of the beginning of any
calendar quarter, a Participant may change the designation made under this
Section 3.2 by filing an election, on a form provided by the Committee, at least
thirty (30) calendar days prior to the beginning of such quarter. If a
Participant fails to elect a type of fund under this Section 3.2, he or she
shall be deemed to have elected the Fund determined by the Committee to most
closely approximate a money market fund.

(b) Although the Participant may designate the type of mutual funds
----
in paragraph (a) above, the Committee shall select from time to time, in its
sole discretion, a commercially available fund or contract of each of the
available types to be the Funds. The Interest Rate of each such commercially
available fund or contract shall be used to determine the amount of earnings to
be credited to Participants' Accounts under Article IV.

ARTICLE IV
PARTICIPANT ACCOUNTS

4.1 Deferral Account.
----------------

The Committee shall establish and maintain a Deferral Account for each
Participant under the Plan. Each Participant's Deferral Account shall be
further divided into separate subaccounts ("mutual fund subaccounts"), each of
which corresponds to a mutual fund or contract elected by the Participant
pursuant to Section 3.2(a). A Participant's Deferral Account shall be credited
as follows:

(a) As of the last day of each month, the Committee shall credit
the mutual fund subaccounts of the Participant's Deferral Account with an
amount equal to Salary and/or commissions deferred by the Participant
during each pay period ending in that month in accordance with the
Participant's election under Section 3.2(a); that is, the portion of the
Participant's deferred Salary and/or commissions that the Participant has
elected to be deemed to be invested in a certain type of mutual fund shall
be credited to the mutual fund subaccount corresponding to that mutual
fund;

(b) As of the last day of the month in which the Bonus or
partial Bonus would have been paid, the Committee shall credit the mutual
fund subaccounts of the Participant's Deferral Account with an amount equal
to the portion of the Bonus deferred by the Participant for such Plan Year
in accordance with the Participant's election under Section 3.2(a); that
is, the portion of the

6
<PAGE>

Participant's deferred Bonus that the Participant has elected to be deemed
to be invested in a particular type of mutual fund shall be credited to the
mutual fund subaccount corresponding to that mutual fund; and

(c) As of the last day of each month, each mutual fund
subaccount of a Participant's Deferral Account shall be credited with
earnings in an amount equal to that determined by multiplying the balance
credited to such mutual fund subaccount as of the last day of the preceding
month by the Interest Rate for the corresponding Fund selected by the
Company pursuant to Section 3.2(b).

4.2 Company Matching Account.
------------------------

The Committee shall establish and maintain a Company Matching Account
for each Participant under the Plan. Each Participant's Company Matching
Account shall be further divided into separate mutual fund subaccounts
corresponding to the type of mutual fund or contract elected by the Participant
pursuant to Section 3.2(a). A Participant's Company Matching Account shall be
credited as follows:

(a) As of the last day of each Plan Year, the Committee shall
credit the mutual fund subaccounts of the Participant's Company Matching
Account with an amount equal to 50% of the amount of the Salary deferred by
the Participant during each pay period ending in that Plan Year (the
"Company Matching Amount") in accordance with the Participant's election
under Section 3.2(a); that is, the portion of the Company Matching Amount
which the Participant elected to be deemed to be invested in a certain type
of mutual fund shall be credited to the corresponding mutual fund
subaccount. Notwithstanding the foregoing, in no event shall the Company
Matching Amount for a Plan Year, when combined with the maximum Company
Matching Contribution which the Participant could have received under the
Advanced Micro Devices, Inc. Retirement Savings Plan for the same year
(assuming deferrals at the maximum permissible rate), exceed 1.5% of the
Participant's Salary during such Plan Year.

(b) As of the last day of each month, each mutual fund
subaccount of a Participant's Company Matching Account shall be credited
with earnings in an amount equal to that determined by multiplying the
balance credited to such mutual fund subaccount as of the last day of the
preceding month by the Interest Rate for the corresponding Fund selected by
the Company pursuant to Section 3.2(b).

7
<PAGE>

ARTICLE V
VESTING

5.1 Deferral Account.
----------------

A Participant's Deferral Account shall at all times be 100% vested.

5.2 Company Matching Account.
------------------------

A Participant's Company Matching Account shall at all times be 100%
vested.

ARTICLE VI
DISTRIBUTIONS

6.1 Amount and Time of Distribution.
-------------------------------

Each Participant (or, in the case of his or her death, the
Participant's Beneficiary) shall be entitled to receive a distribution of
benefits under this Plan as soon as practicable following his or her Payment
Eligibility Date. The amount payable to a Participant shall be the sum of the
amount credited to his or her Deferral Account and Company Matching Account as
of his or her Payment Eligibility Date. No amount credited to a Participant's
Loan Account established under Article VII shall be distributed to the
Participant, but such amount shall instead be forfeited, as provided in
paragraph 7.1(f). If a Participant's account becomes payable and the Company
after a reasonable search and a period of three (3) years from the Participant's
Payment Eligibility Date cannot locate the Participant (or, if the Participant's
Beneficiary is entitled to payment, such beneficiary), the Participant's
Accounts shall be forfeited to the Company.

6.2 Form of Distribution.
--------------------

(a) Lump Sum. The form of the distribution of benefits to a
--------
Participant (or his or her Beneficiary) shall be a cash lump sum payment.

(b) Installments.
------------

(1) Notwithstanding subsection (a) above, a Participant may
elect that his or her benefits be paid in substantially equal annual
installments over three to ten years provided that his or her election is
filed with the Committee at least two years prior to the date his or her
employment with the Company terminates and provided further that the amount
of the first annual installment (determined by dividing the account balance
by the number of installments elected) would be in an amount at least equal
to $20,000.

8
<PAGE>

(2) The first annual installment shall be paid within 90 days
following the end of the Plan Year during which the Participant's
employment with the Company terminates. Subsequent installments shall be
paid on the annual anniversaries of the first installment payment.

(3) Notwithstanding anything contained in Sections 4.1(c) or
4.2(b) to the contrary, beginning with the month following the month in
which the Participant's employment with the Company terminates and
continuing until all amounts credited to his or her Accounts have been
distributed, the Participant's Accounts will be credited with interest, as
of the end of each month, at the rate determined by the Committee from time
to time, which rate shall be either (1) the rate of return of a
professionally managed fixed income fund for such month or (2) one-twelfth
of the annual prime rate of interest declared by Bank of America, N.A.,
Wells Fargo Bank, N.A. or First Interstate Bank of California and in effect
on the first day of such month.

6.3 Termination of Participation
----------------------------

The Company reserves the unilateral right to terminate or restrict a
Participant's participation at any time, and distribute all amounts due to such
Participant.

ARTICLE VII
PARTICIPANT LOANS

7.1 Hardship Loans to Participants.
------------------------------

(a) Subject to the approval of the Committee and guidelines
promulgated by the Committee, each Participant may borrow from the Company in
order to meet a financial hardship to the Participant resulting from (1) an
illness or accident of the Participant or a dependent of the Participant, (2)
loss of the Participant's property due to casualty or (3) other similar
circumstances arising as a result of events beyond the control of the
Participant. Each loan made pursuant to this Section 7.1 shall be evidenced by a
note from the Participant on a form provided by the Committee. Such note shall
bear interest at a rate equal to that necessary to avoid imputed interest under
Sections 7872 and 1274(d) of the Code and have such other terms as the Committee
shall determine.

(b) The Committee may make a loan under this Section 7.1 only if the
amount of the loans outstanding does not exceed the amount required to meet the
immediate financial need created by such hardship and does not exceed 65% of the
combined balance of the Participant's Deferral Account and Loan Account as of
the first day of the month next following the Committee's acceptance of the
Participant's written application for a hardship loan.

9
<PAGE>

(c) The Committee shall, upon making a loan to a Participant,
establish and maintain a Loan Account for the Participant. The Committee shall
debit the mutual fund subaccounts maintained under the Participant's Deferral
Account on a pro-rata basis or on such other basis as the Committee deems
appropriate or desirable and shall credit the Participant's Loan Account in an
amount equal to the amount of the loan. The amount credited to a Participant's
Loan Account shall not be deemed to be invested as directed by the Participant
under Section 3.2(a) but shall be deemed to be invested in the note given to the
Company by the Participant under this Section 7.1.

(d) As of the last day of each month, the Participant's Loan Account
will be credited with interest for the period since the last day of the
preceding month, calculated on the balance of the Loan Account as of such date,
at the rate of interest on the note as specified in paragraph (a) above.

(e) Upon any payment of principal and/or interest on a loan made
pursuant to this Section 7.1, the Committee shall debit the Participant's Loan
Account and shall credit the mutual fund subaccounts maintained under the
Participant's Deferral Account with the amount of such payment on a pro-rata
basis or on such other basis as the Committee deems appropriate or desirable.

(f) On a Participant's Payment Eligibility Date or, if earlier, the
date on which the first annual installment payment is due to a Participant, any
outstanding balance in the Participant's Loan Account shall be reduced to zero,
and the obligation to repay the hardship loan shall be cancelled.

ARTICLE VIII
ADMINISTRATION

8.1 Committee Action.
----------------

The Committee shall act at meetings by affirmative vote of a majority
of the members of the Committee. Any action permitted to be taken at a meeting
may be taken without a meeting if, prior to such action, a written consent to
the action is signed by all members of the Committee and such written consent is
filed with the minutes of the proceedings of the Committee. A member of the
Committee shall not vote or act upon any matter which relates solely to himself
or herself as a Participant. The Chairman or any other member or members of the
Committee designated by the Chairman may execute any certificate or other
written direction on behalf of the Committee.

8.2 Powers and Duties of the Committee.
----------------------------------

(a) The Committee, on behalf of the Participants and their
Beneficiaries, shall enforce the Plan in accordance with its terms, shall be
charged with the general administration of

10
<PAGE>

the Plan, and shall have all powers necessary to accomplish its purposes,
including, but not by way of limitation, the following:

(1) To determine all questions relating to the eligibility of
employees to participate;

(2) To select the funds or contracts to be the Funds in
accordance with Section 3.2(b) hereof;

(3) To construe and interpret the terms and provisions of this
Plan;

(4) To compute and certify to the amount and kind of benefits
payable to Participants and their Beneficiaries;

(5) To maintain all records that may be necessary for the
administration of the Plan;

(6) To provide for the disclosure of all information and the
filing or provision of all reports and statements to Participants,
Beneficiaries or governmental agencies as shall be required by law;

(7) To make and publish such rules for the regulation of the
Plan and procedures for the administration of the Plan as are not
inconsistent with the terms hereof; and

(8) To appoint a plan administrator or, any other agent, and to
delegate to them such powers and duties in connection with the
administration of the Plan as the Committee may from time to time
prescribe.

8.3 Construction and Interpretation.
-------------------------------

The Committee shall have full discretion to construe and interpret the
terms and provisions of this Plan, which interpretation or construction shall be
final and binding on all parties, including but not limited to the Company and
any Participant or Beneficiary. The Committee shall administer such terms and
provisions in a uniform and nondiscriminatory manner and in full accordance with
any and all laws applicable to the Plan.

8.4 Information.
-----------

To enable the Committee to perform its functions, the Company shall
supply full and timely information to the Committee on all matters relating to
the Compensation of all Participants, their death or other cause of termination,
and such other pertinent facts as the Committee may require.

11
<PAGE>

8.5 Compensation, Expenses and Indemnity.
------------------------------------

(a) The members of the Committee shall serve without compensation for
their services hereunder.

(b) The Committee is authorized at the expense of the Company to
employ such legal counsel as it may deem advisable to assist in the performance
of its duties hereunder. Expenses and fees in connection with the
administration of the Plan shall be paid by the Company.

(c) To the extent permitted by applicable state law, the Company
shall indemnify and save harmless the Committee and each member thereof, the
Board of Directors and any delegate of the Committee who is an employee of the
Company against any and all expenses, liabilities and claims, including legal
fees to defend against such liabilities and claims arising out of their
discharge in good faith of responsibilities under or incident to the Plan, other
than expenses and liabilities arising out of willful misconduct. This indemnity
shall not preclude such further indemnities as may be available under insurance
purchased by the Company or provided by the Company under any bylaw, agreement
or otherwise, as such indemnities are permitted under state law.

8.6 Quarterly Statements.
--------------------

Under procedures established by the Committee, a Participant shall
receive a statement with respect to such Participant's Accounts as soon as
practicable following the end of each calendar quarter.

ARTICLE IX
MISCELLANEOUS

9.1 Unsecured General Creditor.
--------------------------

Participants and their Beneficiaries, heirs, successors, and assigns
shall have no legal or equitable rights, claims, or interest in any specific
property or assets of the Company. No assets of the Company shall be held under
any trust, or held in any way as collateral security for the fulfilling of the
obligations of the Company under this Plan. Any and all of the Company's assets
shall be, and remain, the general, unpledged, unrestricted assets of the
Company. The Company's obligation under the Plan shall be merely that of an
unfunded and unsecured promise of the Company to pay money in the future, and
the rights of the Participants and Beneficiaries shall be no greater than those
of unsecured general creditors.

12
<PAGE>

9.2 Restriction Against Assignment.
------------------------------

The Company shall pay all amounts payable hereunder only to the person
or persons designated by the Plan and not to any other person or corporation.
No part of a Participant's Accounts shall be liable for the debts, contracts, or
engagements of any Participant, his or her Beneficiary, or successors in
interest, nor shall a Participant's Accounts be subject to execution by levy,
attachment, or garnishment or by any other legal or equitable proceeding, nor
shall any such person have any right to alienate, anticipate, commute, pledge,
encumber, or assign any benefits or payments hereunder in any manner whatsoever.
If any Participant, Beneficiary or successor in interest is adjudicated bankrupt
or purports to anticipate, alienate, sell, transfer, assign, pledge, encumber or
charge any distribution or payment from the Plan, voluntarily or involuntarily,
the Committee, in its discretion, may cancel such distribution or payment (or
any part thereof) to or for the benefit of such Participant, Beneficiary or
successor in interest in such manner as the Committee shall direct.

9.3 Withholding.
-----------

There shall be deducted from each payment made under the Plan all
taxes which are required to be withheld by the Company in respect to such
payment. The Company shall have the right to reduce any payment by the amount
of cash sufficient to provide the amount of said taxes.

9.4 Amendment, Modification, Suspension or Termination.
--------------------------------------------------

The Company may amend, modify, suspend or terminate the Plan in whole
or in part, except that no amendment, modification, suspension or termination
shall reduce any amounts then allocated previously to a Participant's Accounts.
In the event that this Plan is terminated, the amounts credited to a
Participant's Deferral Account and Company Matching Account shall be distributed
to the Participant or, in the event of his or her death, to his or her
Beneficiary in a lump sum within thirty (30) days following the date of
termination.

9.5 Governing Law.
-------------

This Plan shall be construed, governed and administered in accordance
with the laws of the State of California.

9.6 Receipt or Release.
------------------

Any payment to a Participant or the Participant's Beneficiary in
accordance with the provisions of the Plan shall, to the extent thereof, be in
full satisfaction of all claims against the Committee and the Company. The
Committee may require such Participant or Beneficiary, as a condition precedent
to such payment, to execute a receipt and release to such effect.

13
<PAGE>

9.7 Headings, etc. Not Part of Agreement.
------------------------------------

Headings and subheadings in this Plan are inserted for convenience of
reference only and are not to be considered in the construction of the
provisions hereof.

9.8 Limitation on Participants' Rights.
----------------------------------

Participation in this Plan shall not give any Eligible Employee the
right to be retained in the Company's employ or any right or interest in the
Plan other than as herein provided. The Company reserves the right to dismiss
any Eligible Employee without any liability for any claim against the Company,
except to the extent provided herein.

ARTICLE X
BENEFIT OFFSET

10.1 Offset for Certain Benefits Payable Under Split-Dollar Life Insurance
---------------------------------------------------------------------
Policies.
--------

(a) Notwithstanding anything contained herein to the contrary, any
benefits payable under this Plan shall be offset by the value of benefits
received by the Participants under certain life insurance policies as set forth
in this Section. Participants in this Plan may own life insurance policies (the
"Policies") purchased on their behalf by the Company. The exercise of ownership
rights under these Policies by each Participant is, however, subject to certain
conditions (set forth in a "Split-Dollar Life Insurance Agreement" between each
Participant and the Company pursuant to which the Company holds a security
interest on the Policy) and, if the Participant fails to meet the conditions set
forth in the Split-Dollar Life Insurance Agreement, the Company may exercise its
security interest in the Policy and cause the Participant to lose certain
benefits under the Policy. In the event that a Participant satisfies the
conditions specified in Section 5 of the Split-Dollar Life Insurance Agreement,
so that the Participant becomes entitled to exercise rights under that section
free from the Company's security interest, or the Company's security interest is
otherwise released for a reason other than the Participant's death, the value of
those benefits shall constitute an offset to any benefits otherwise payable
under this Plan. This offset (the "Offset Value") shall be equal to the value
of benefits payable under the Split-Dollar Life Insurance Agreement, that is,
the cash surrender value of the Policy. The Offset Value shall then be compared
to the Participant's Accounts, and the amounts credited to the Accounts shall be
reduced, but not to less than zero, by the Offset Value; provided, however, that
any portion of the Accounts which is attributable to Compensation deferred
during Plan Years in which the Company did not pay premiums on the Policy shall
not be reduced by the Offset Value, and the Committee shall maintain subaccounts
of a Participant's Accounts to the extent necessary to determine that portion of
each Account

14
<PAGE>

which is subject to offset and the portion which is not subject to offset. The
offset shall first be applied to the Participant's Company Matching Account and
then to the Participant's Deferral Account.

(b) If the Policy in subsection (a) is not on the life of the
Participant and the insured dies prior to distribution of benefits under this
Plan, then the value of the benefits received by the Participant under the
Policy will offset the Participant's Accounts under this Plan to the extent
provided in this subsection (b). This offset ("Offset Value") shall be equal to
the amount of death benefit payable to the Participant divided by the Tax
Adjustment Factor. This Offset Value shall then be compared to the
Participant's Accounts, and the amounts credited to the Accounts shall be
reduced, but not to be less than zero, by the Offset Value; provided, however,
that any portion of the Accounts which is attributable to Compensation deferred
during Plan Years in which the Company did not pay premiums on the Policy shall
not be reduced by the Offset Value. The offset shall first be applied to the
Participant's Company Matching Account and then to the Participant's Deferral
Account.

(c) The reduction described in Section 10.1(a) shall be made as of
the date on which the Participant becomes entitled to exercise rights under the
Policy free of the Company's security interest, and the reduction described in
Section 10.1(b) shall be made as of the date on which the Participant receives
the death proceeds.

(d) In the event of an offset as described herein, any election to
receive distribution of the amounts credited to a Participant's Accounts in the
form of installments shall be deemed to be revoked, and any benefits which are
or become payable under this Plan after such offset shall be paid in a lump sum
as soon as practicable following the Participant's Payment Eligibility Date.

IN WITNESS WHEREOF, the Company has caused this Executive Savings Plan
to be executed by its duly authorized officers on this _____ day of ________,
19__.

ADVANCED MICRO DEVICES, INC.

By_________________________
Stanley Winvick
Senior Vice President,
Human Resources

By_________________________
Marvin D. Burkett
Senior Vice President
and Chief Financial Officer

15
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.31
<SEQUENCE>9
<DESCRIPTION>FORM OF SPLIT DOLLAR AGMT., AS AMENDED.
<TEXT>

<PAGE>

EXHIBIT 10.31

SPLIT-DOLLAR LIFE INSURANCE AGREEMENT
-------------------------------------

This Agreement is entered into as of __________, 19__ by and between
Advanced Micro Devices, Inc. (the "Company") and _______________________
("Employee") in reference to the following facts:

1. Employee is a valued employee of __________ _______________________.

2. The Company has simultaneously with the execution of this Agreement
caused The Manufacturers Life Insurance Company of America (the "Insurance
Company") to issue policy number ___________________ (the "Policy") on the life
of Employee. The first annual premium has been paid by the Company as of the
date of this Agreement.

3. For purposes of this Agreement, the Company and its subsidiaries shall
constitute the "Employer." For this purpose, a subsidiary is a corporation of
which the Company owns, directly or indirectly, more than 50% of such
corporation's outstanding securities. If Employee is employed by a corporation
which, as a result of a sale or other corporate reorganization, ceases to be a
subsidiary, such sale or other corporate reorganization shall be treated as a
termination of Employee by Employer without Cause (as defined in Section 8)
unless immediately following the event and without any break in employment the
Employee remains employed by the Company or another corporation which is a
subsidiary.

NOW THEREFORE, in consideration of the facts set forth above and the
various promises and covenants set forth below, the parties to this Agreement
agree as follows:

1. Ownership of Policy.
-------------------

The Company acknowledges that Employee is the owner of the Policy and that
Employee is entitled to exercise all of his or her ownership rights granted by
the terms of the Policy, except to the extent that the power of the Employee to
exercise those rights is specifically limited by this Agreement. Except as so
limited, it is the expressed intention of the parties to reserve to Employee all
rights in and to the Policy granted to its owner by the terms thereof,
including, but not limited to, the right to change the beneficiary of that
portion of the proceeds to which the Employee is entitled under Section 4 of the
Agreement and the right to exercise settlement options.
<PAGE>

2. The Company's Security Interest.
-------------------------------

The Company's security interest in the Policy is conditioned upon its
satisfactorily performing all of the covenants under this Agreement. Each
period covered by any individual premium payment described in Section 3 shall be
considered a discrete extension of the Company's security interest in the
Policy. The Company shall not have nor exercise any right in and to the Policy
which could, in any way, endanger, defeat, or impair any of the rights of
Employee in the Policy, including by way of illustration any right to collect
the proceeds of the Policy in excess of the amount due the Company as provided
in this Agreement and in the Policy. The only rights in and to the Policy
granted to the Company in this Agreement shall be limited to the Company's
security interest in and to the cash value of the Policy, as defined herein, and
a portion of the death benefit of the Policy as hereinafter provided (the
"Security Interest"). The Company shall not assign any of its Security Interest
in the Policy to anyone other than Employee.

3. Premium payments.
----------------

So long as Employee is employed by the Employer and the Company's Security
Interest has not been released, the Company agrees to pay an annual premium on
the Policy on or before the last day of each "Policy Year" (as such term is used
in the Policy) in an amount equal to the sum of (a) the compensation deferred by
Employee under the Advanced Micro Devices Executive Savings Plan (the "Plan")
during the pay periods ending during such Policy Year plus (b) the "cost of
insurance" (as defined in the Policy) for the excess, if any, of (i) the death
benefit required under Section 4 hereof (determined in compliance with the 7-pay
test set forth in Section 7702A of the Code) over (ii) the minimum death benefit
(determined in compliance with such 7-pay test) which could be provided by that
portion of the accumulated premiums actually paid under the Policy which were
paid pursuant to clause (a) of this sentence. The premium payment shall be
transmitted directly by the Company to the Insurance Company. Consistent with
the preceding sentences, prior to the release of the Company's Security Interest
in the Policy, Employee and the Company agree that the Company shall from time
to time designate one or more individuals (the "Designee"), who may be officers
of the Company, who shall be entitled to adjust the death benefit under the
Policy and to direct the investments under the Policy; provided, however, that
the Designee may only increase, but not decrease, the death benefit in effect on
the date that the Policy is issued; provided further, that the Designee may only
direct the investments under the Policies in funds offered by the Insurance
Company under the Policy. During the period of time that this Agreement is in
effect, Employee irrevocably agrees that all dividends paid on the Policy shall
be applied to purchase from the Insurance Company additional paid up life
insurance on the life of Employee.

2
<PAGE>

4. Death of Employee while employed by Employer.
--------------------------------------------

(a) If Employee dies prior to termination of employment with Employer and
prior to his or her Security Release Date (as defined in Section 10 below),
Employee's designated beneficiary shall be entitled to receive as a death
benefit an amount equal to three times the Employee's annual base salary at the
time of death, subject to a maximum benefit of Two Million Dollars ($2,000,000).
The amount described in the preceding sentence shall be paid from the proceeds
of the Policy; to the extent such amount exceeds such proceeds, the difference
shall be paid from any other source that the Company may designate, which may be
either another life insurance policy on the life of Employee or the general
assets of the Company. To the extent that the death benefit under the Policy
exceeds such amount, the balance of the death benefit shall be payable to the
Company. The designation of the beneficiaries under the Policy shall be in
accordance with this Section.

(b) Employee agrees that, during the period of this Agreement, Employee
will obtain and provide to the Company and/or the Insurance Company the written
consent of the spouse of the Employee, in the form attached hereto as Exhibit C,
to any designation by Employee of anyone other than the Employee's spouse as the
beneficiary to receive the benefits under this Section 4.

5. Employee's attaining his or her Security Release Date or termination of
-----------------------------------------------------------------------
Employee's employment on account of a Qualifying Termination.
------------------------------------------------------------

(a) By making timely payment of the premiums described in Section 3, the
Company may renew its Security Interest in the Policy for the period commencing
with the due date of such payment until the later of (1) the due date of the
next payment described in Section 3, or (2) the date that Employee attains his
or her Security Release Date or terminates employment with the Employer on
account of a Qualifying Termination (either of which events described in this
clause 2 is referred to herein as a "Qualifying Event"). The Company may not
extend its Security Interest in the Policy under the Collateral Security
Assignment Agreement attached as Exhibit A after the occurrence of a Qualifying
Event. After such Qualifying Event, Employee shall be entitled to exercise all
of his or her ownership rights in the Policy without any limitation and this
Agreement and its accompanying Collateral Security Assignment Agreement shall no
longer constitute a restriction on Employee's rights.

(b) Notwithstanding paragraph (a), the Company shall continue to have its
Security Interest in the Policy, to the extent required to satisfy its
withholding obligations as described in Section 12 and to recover any amounts
owed by Employee as described in paragraph (c) below.

3
<PAGE>

(c) Employee agrees that if, at the time of the occurrence of a Qualifying
Event, Employee has any outstanding balances on any loans made by the Company to
Employee, then, unless Employee otherwise pays such outstanding balances,
Employee shall cause, either by withdrawing from or borrowing on a non-recourse
basis against the Policy, to be transferred to the Company, that portion of the
cash value of the Policy which is equal to the sum of the outstanding balances
on all such loans.

6. Termination of an Employee for a reason other than a Qualifying
---------------------------------------------------------------
Termination.
-----------

If the employment of Employee with Employer is terminated prior to his or
her Security Release Date for a reason other than a Qualifying Termination (as
described below), Employee shall cause, either by withdrawing from or borrowing
against the Policy, on a nonrecourse basis, to be transferred to the Company an
amount equal to the maximum amount that may then be obtained under the Policy.
In the event that the amount that can be withdrawn from or borrowed against the
Policy is less than the cash surrender value of the Policy, the Company shall
withhold from other compensation payable to Employee the amount of such
difference unless Employee has previously transferred to the Company an amount
equal to such difference. In no event shall Employee's voluntary resignation
prior to attaining his or her Security Release Date (as such concept is further
defined below) ever constitute a Qualifying Termination, except in certain
situations following a Change in Control (see Section 9).

7. Definition of a Qualifying Termination.
--------------------------------------

A Qualifying Termination is either of the following events: the termination
of Employee by Employer for any reason other than "Cause," as described in
Section 8; or the termination of Employee after a Change in Control under the
circumstances described in Section 9(a). Both of these concepts are further
defined below.

8. Qualifying Termination because Employee is terminated for a reason other
------------------------------------------------------------------------
than "Cause".
------------

For purposes of this Section, "Cause" shall mean (1) an act or acts of
dishonesty or moral turpitude (including but not limited to conviction of a
felony) taken by Employee; (2) Employee's willful failure to substantially
perform Employee's duties where such willful failure results in demonstrable
material injury and damage to the Employer; (3) Employee's misrepresentation or
concealment of a material fact for the purpose of securing employment with the
Employer; or (4) performance by Employee which is substantially below the
standard of performance which can reasonably be expected from an individual
occupying Employee's position or Employee's substantially failing to meet
performance objectives (such as

4
<PAGE>

performance objectives relating to profit) which have been previously agreed to
between Employee and Employer.

9. Qualifying Termination on account of a Change in Control.
--------------------------------------------------------

(a) A Qualifying Termination shall be treated as occurring on account of a
"Change in Control" (as defined below) if within six (6) months prior to or 36
months following such Change in Control, either (1) Employee's employment with
the Employer is terminated without "Cause" (as defined in Section 8) or (2)
Employee terminates his or her employment with the Employer for "Good Reason"
(as defined in subsection (c) below).

(b) For purposes of this Section, a "Change in Control" shall mean a
change of control of a nature that would be required to be reported in response
to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Securities
and Exchange Act of 1934, as amended (the "Exchange Act"), or in response to any
other form or report to the Securities and Exchange Commission or any stock
exchange on which the Company's shares are listed which requires the reporting
of a change of control. In addition, a Change of Control shall be deemed to
have occurred if (i) any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) is or becomes the beneficial owner, directly or
indirectly, of securities of the Company representing more than 20% of the
combined voting power of the Company's then outstanding securities; or (ii) in
any two-year period, individuals who were members of the Board of Directors (the
"Board') at the beginning of such period plus each new director whose election
or nomination for election was approved by at least two-thirds of the directors
in office immediately prior to such election or nomination, cease for any reason
to constitute at least a majority of the Board; or (iii) a majority of the
members of the Board in office prior to the happening of any event and who are
still in office after such event, determines in its sole discretion within one
year after such event, that as a result of such event there has been a Change of
Control. Notwithstanding the foregoing definition, "Change of Control" shall
exclude the acquisition of securities representing more than 20% of the combined
voting power of the Company by the Company, any of its wholly-owned
subsidiaries, or any trustee or other fiduciary holding securities of the
Company under an employee benefit plan now or hereafter established by the
Company. As used herein, the term "beneficial owner" shall have the same
meaning as under Section 13(d) of the Exchange Act and related case law.

5
<PAGE>

(c) For purposes of this Section, "Good Reason" shall mean the occurrence
of one of the following events without Employee's consent:

(1) An adverse and significant change in the Employee's position,
duties, responsibilities, or status with the Employer, or a
change in Employee's office location to a point which is more
than 30 miles from his or her office location prior to the Change
in Control.

(2) A reduction by the Employer in Employee's base salary or
incentive compensation opportunity not agreed to by Employee; and

(3) The taking of any action by the Employer to eliminate benefit
plans without providing substitutes therefor, to reduce benefits
thereunder or to substantially diminish the aggregate value of
incentive awards or other fringe benefits.

(d) A termination of employment by Employee shall be for Good Reason if
one of the occurrences specified in paragraph (c) shall have occurred,
notwithstanding that Employee may have other reasons for terminating employment,
including employment by another employer which Employee desires to accept.

10. Employee's attaining his or her Security Release Date.
-----------------------------------------------------

(a) Employee's "Security Release Date" shall mean the later of: (i) the
date which is two years following the date on which the Company receives from
Employee a completed notice in the form attached hereto as Exhibit B (ii) the
date specified in such notice as the Security Release Date; provided that
Employee continues to be employed by Employer until such date. Notwithstanding
the preceding sentence, Employee may elect, by completing a notice in the form
attached hereto as Exhibit D, that his or her Security Release Date be later
than the date selected in accordance with the preceding sentence, so long as
such election is filed with the Company at least two years prior to the date
which would otherwise constitute his or her Security Release Date. For example,
if Employee originally selects January 1, 1998 as his or her Security Release
Date, he or she may elect at any time prior to January 1, 1996 that his or her
Security Release Date be postponed. Each election to postpone a Security
Release Date, once filed with the Company shall be irrevocable with regard to
said election. Employee is entitled to make a maximum of two elections to
postpone his or her initial Security Release Date under this Agreement.

(b) Employee shall attain his or her Security Release Date upon becoming
disabled while employed by the Employer. Employee

6
<PAGE>

shall be considered "disabled" at the time that the Administrator (as defined in
Section 13(a) below) determines, based upon competent medical advice, that an
Employee is incapable of rendering substantial services to the Employer by
reason of mental or physical disability.

(c) The Company's Security Interest in the Policy is contingent upon the
timely payment of premiums under Section 3 of this Agreement. Each period
covered by any individual premium payment shall be considered an independent
extension of the Company's Security Interest in the Policy. In the event that
the Company waives its rights by reason of failure to make payments under
Section 3 of this Agreement, Employee shall immediately attain his or her
Security Release Date. The Company's failure to extend its rights in no way
affects the Company's duties and obligations under this Agreement.

11. Limitation on Employee's rights prior to a Qualifying Event.
-----------------------------------------------------------

In order to protect the Company's Security Interest and notwithstanding any
other provisions in this Agreement, prior to a Qualifying Event, Employee agrees
that he or she will not modify the death benefit under the Policy, borrow
against the Policy, assign the Policy, direct the investment of the cash
surrender value of the Policy, or obtain any portion of the cash value of the
Policy. Notwithstanding the preceding sentence, if Section 6 applies to a
termination, Employee may borrow or withdraw from the Policy, so long as the
borrowing or withdrawal request is submitted to the Insurance Company along with
a directive that the borrowed or withdrawn amount be transferred directly to the
Company.

12. Tax Withholding.
---------------

It is recognized by the parties that the rights of Employee in the Policy
(as modified by the Agreement) may cause Employee to be treated under certain
circumstances as in receipt of gross income. These circumstances may also
impose upon the Company an obligation to deduct and withhold federal, state or
local taxes. Unless Employee otherwise provides the Company the amounts it is
required to withhold, Employee shall cause, either by withdrawing from or
borrowing on a nonrecourse basis against the Policy, to be transferred to the
Company that portion of the cash value of the Policy which is equal to the
amount of any federal, state or local taxes required to be withheld.

13. Disputes.
--------

(a) The Compensation Committee of the Board of Directors of the Company
(the "Administrator") shall administer this Agreement. The Administrator
(either directly or through its designees) will have power and authority to
interpret, construe,

7
<PAGE>

and administer this Agreement (for the purpose of this section, the Agreement
shall include the Collateral Security Assignment Agreement); provided that, the
Administrator's authority to interpret this Agreement shall not cause the
Administrator's decisions in this regard to be entitled to a deferential
standard of review in the event that Employee or his or her beneficiary seeks
review of the Administrator's decision as described below.

(b) Neither the Administrator, its designee nor its advisors, shall be
liable to any person for any action taken or omitted in connection with the
interpretation and administration of this Agreement.

(c) Because it is agreed that time will be of the essence in determining
whether any payments are due to Employee or his or her beneficiary under this
Agreement, Employee or his or her beneficiary may, if he or she desires, submit
any claim for payment under this Agreement or dispute regarding the
interpretation of this Agreement to arbitration. This right to select
arbitration shall be solely that of Employee or his or her beneficiary and
Employee or his or her beneficiary may decide whether or not to arbitrate in his
or her discretion. The "right to select arbitration" is not mandatory on
Employee or his or her beneficiary and Employee or his or her beneficiary may
choose in lieu thereof to bring an action in an appropriate civil court. Once an
arbitration is commenced, however, it may not be discontinued without the
mutual consent of both parties to the arbitration. During the lifetime of the
Employee only he or she can use the arbitration procedure set forth in this
section.

(d) Any claim for arbitration may be submitted as follows: if Employee or
his or her beneficiary disagrees with the Administrator regarding the
interpretation of this Agreement and the claim is finally denied by the
Administrator in whole or in part, such claim may be filed in writing with an
arbitrator of Employee's or beneficiary's choice who is selected by the method
described in the next four sentences. The first step of the selection shall
consist of Employee or his or her beneficiary submitting a list of five
potential arbitrators to the Administrator. Each of the five arbitrators must
be either (1) a member of the National Academy of Arbitrators located in the
State of California or (2) a retired California Superior Court or Appellate
Court judge. Within one week after receipt of the list, the Administrator shall
select one of the five arbitrators as the arbitrator for the dispute in
question. If the Administrator fails to select an arbitrator in a timely
manner, Employee or his or her beneficiary shall then designate one of the five
arbitrators as the arbitrator for the dispute in question.

(e) The arbitration hearing shall be held within seven days (or as soon
thereafter as possible) after the picking of the arbitrator. No continuance of
said hearing shall be allowed without the mutual consent of Employee or his or
her beneficiary

8
<PAGE>

and the Administrator. Absence from or nonparticipation at the hearing by
either party shall not prevent the issuance of an award. Hearing procedures
which will expedite the hearing may be ordered at the arbitrator's discretion,
and the arbitrator may close the hearing in his or her sole discretion when he
or she decides he or she has heard sufficient evidence to satisfy issuance of an
award.

(f) The arbitrator's award shall be rendered as expeditiously as possible
and in no event later than one week after the close of the hearing. In the
event the arbitrator finds that the Company has breached this Agreement, he or
she shall order the Company to immediately take the necessary steps to remedy
the breach. The award of the arbitrator shall be final and binding upon the
parties. The award may be enforced in any appropriate court as soon as possible
after its rendition. If an action is brought to confirm the award, both the
Company and Employee agree that no appeal shall be taken by either party from
any decision rendered in such action.

(g) Solely for purposes of determining the allocation of the costs
described in this subsection, the Administrator will be considered the
prevailing party in a dispute if the arbitrator determines (1) that the Company
has not breached this Agreement and (2) the claim by Employee or his or her
beneficiary was not made in good faith. Otherwise, Employee or his or her
beneficiary will be considered the prevailing party. In the event that the
Company is the prevailing party, the fee of the arbitrator and all necessary
expenses of the hearing (excluding any attorneys' fees incurred by the Company)
including stenographic reporter, if employed, shall be paid by the other party.
In the event that Employee or his or her beneficiary is the prevailing party,
the fee of the arbitrator and all necessary expenses of the hearing (including
---------
all attorneys' fees incurred by Employee or his or her beneficiary in pursuing
his or her claim), including the fees of a stenographic reporter if employed,
shall be paid by the Company.

14. Collateral Security Assignment of Policy to the Company.
-------------------------------------------------------

In consideration of the promises contained herein, the Employee has
contemporaneously herewith granted the Security Interest in the Policy to the
Company as collateral, under the form of Collateral Security Assignment attached
hereto as Exhibit A, which Collateral Security Assignment gives the Company the
limited power to enforce its rights to recover the cash value of the Policy
under the circumstances defined herein, or a portion of the death benefit
thereof. The Company's Security Interest in the Policy shall be specifically
limited to the rights set forth above in this Agreement, notwithstanding the
provisions of any other documents including the Policy. Employee agrees to
execute

9
<PAGE>

any notice prepared by the Company requesting a withdrawal or non-recourse loan
in an amount equal to the amount to which the Company is entitled under Sections
5, 6 or 12 of this Agreement.

15. Employee's beneficiary rights and security interest.
---------------------------------------------------

(a) The Company and Employee intend that in no event shall the Company
have any power or interest related to the Policy or its proceeds, except as
provided herein and in the Collateral Security Assignment. In the event that the
Company ever receives or may be deemed to have received any right or interest in
the Policy or its proceeds beyond the limited rights described herein and in the
Collateral Security Assignment, such right or interest shall be held in trust
for the benefit of Employee and be held separate from the property of the
Company.

(b) In order to further protect the rights of the Employee, the Company
agrees that its rights to the Policy and proceeds thereof shall serve as
security for the Company's obligations as provided in this Agreement to
Employee. The Company grants to Employee a security interest in and
collaterally assigns to Employee any and all rights the Company has in the
Policy, and products and proceeds thereof whether now existing or hereafter
arising pursuant to the provisions of the Policy, this Agreement, the Collateral
Security Assignment or otherwise, to secure any and all obligations owed by the
Company to Employee under this Agreement. In no event shall this provision be
interpreted to reduce Employee's rights to the Policy or expand in any way the
rights or benefits of the Company under this Agreement, the Policy or the
Collateral Security Assignment. This security interest granted to Employee from
the Company shall automatically expire and be deemed waived if Employee
terminates employment with Employer prior to a Qualifying Event. Nothing in
this provision shall prevent the Company from receiving its share of the death
benefits under the Policy as provided in Section 4 of this Agreement.

16. Amendment of Agreement.
----------------------

Except as provided in a written instrument signed by the Company and
Employee, this Agreement may not be cancelled, amended, altered, or modified.

17. Notice under Agreement.
----------------------

Any notice, consent, or demand required or permitted to be given under the
provisions of this Agreement by one party to another shall be in writing, signed
by the party giving or making it, and may be given either by delivering it to
such other party personally or by mailing it, by United States

10
<PAGE>

Certified mail, postage prepaid, to such party, addressed to its last known
address as shown on the records of the Company. The date of such mailing shall
be deemed the date of such mailed notice, consent, or demand.

18. Binding Agreement.
-----------------

This Agreement shall bind the parties hereto and their respective
successors, heirs, executor, administrators, and transferees, and any Policy
beneficiary.

19. Controlling law and characterization of Agreement.
-------------------------------------------------

(a) To the extent not governed by federal law, this Agreement and the
right to the parties hereunder shall be controlled by the laws of the State of
California.

(b) If this Agreement is considered a "plan" under the Employee Retirement
Income Security Act of 1974 (ERISA), both the Company and Employee acknowledge
and agree that for all purposes the Agreement shall be treated as a "welfare
plan" within the meaning of section 3(1) of ERISA and that any rights that might
arise under ERISA if this Agreement were treated as a "pension plan" within the
meaning of Section 3(2) of ERISA are hereby expressly waived. Consistent with
the preceding sentence, Employee further acknowledges that his or her rights to
the Policy and the release of the Company's Security Interest are strictly
limited to those rights set forth in this Agreement. In furtherance of this
acknowledgement and in consideration of the Company's payment of the initial
premiums for this Policy, Employee voluntarily and irrevocably relinquishes and
waives any additional rights in the Policy or any different restrictions on the
release of the Company's Security Interest that he or she might otherwise argue
to exist under either state, federal, or other law. Employee further agrees that
he or she will not argue in any judicial or arbitration proceeding that any such
additional rights or different restrictions exist. Similarly, the Company
acknowledges that its Security Interest is strictly limited as set forth in this
Agreement and voluntarily and irrevocably relinquishes and waives any additional
interest or different interest or advantages that the Company would have or
enjoy if the Agreement were not treated as a "welfare plan" within the meaning
of Section 3(1) of ERISA.

11
<PAGE>

20. The Company and Employee agree to execute any and all documents
necessary to effectuate the terms of this Agreement.

EMPLOYEE ADVANCED MICRO DEVICES, INC.

____________________ By: __________________________

Its __________________________

12
<PAGE>

EXHIBIT A
---------
COLLATERAL SECURITY ASSIGNMENT AGREEMENT
----------------------------------------

This Collateral Security Assignment is made and entered into effective
as of __________, 19__, by the undersigned as the owner (the "Owner") of Life
Insurance Policy Number ______________ (the "Policy") issued by The
Manufacturers Life Insurance Company of America (the "Insurer") upon the life of
Owner and by Advanced Micro Devices, Inc. a __________ corporation (the
"Assignee").

WHEREAS, the Owner is a valued employee of Assignee or a subsidiary of
Assignee, and the Assignee wishes to retain him or her in its or its
subsidiary's employ; and

WHEREAS, to encourage the Owner's continued employment, the Assignee wishes
to pay premiums on the Policy, as more specifically provided for in that
certain Split-Dollar Life Insurance Agreement dated as of ________________,
19__, and entered into between the Owner and the Assignee as such agreement may
be hereafter amended or modified (the "Agreement") (unless otherwise indicated
the terms herein shall have the definitions ascribed thereto in the Agreement);

WHEREAS, in consideration of the Assignee agreeing to make the premium
payments, the Owner agrees to grant the Assignee a security interest in the
Policy as collateral security; and

WHEREAS, the Owner and Assignee intend that the Assignee have no greater
interest in the Policy than that prescribed herein and in the Agreement and that
if the Assignee ever obtains any right or interest in the Policy or the proceeds
thereof, except as provided herein and in the Agreement, such right or interest
shall be held in trust for the Owner to satisfy the obligations of Assignee to
Owner under the Agreement and the Assignee additionally agrees that its rights
to the Policy shall serve as security for its obligations to the Owner under the
Agreement;

NOW, THEREFORE, the Owner hereby assigns, transfers and sets over to the
Assignee for security the following specific rights in the Policy, subject to
the following terms, agreements and conditions:

1. This Collateral Security Assignment is made, and the Policy is to be
held, as collateral security for all liabilities of the Owner to the Assignee
pursuant to the terms of the Agreement, whether now existing or hereafter
arising (the "Secured Obligations"). The Secured Obligations include: (i) the
obligation of the Owner to transfer an amount equal to the entire cash value in
the event that the Owner terminates employment with Employer for a reason other
than a Qualifying Termination and before attaining his or her Security Release
Date; (ii) the obligation of the Owner to pay an amount of cash to Assignee or
transfer to Assignee that portion of the cash value which is equal to any
federal, state or local taxes that Assignee may be required

A-1
<PAGE>

to withhold and collect (as set forth in Section 12 of the Agreement); and (iii)
the obligation of the Owner to pay an amount of cash to the Company or transfer
to the Company that portion of the cash surrender value of the Policy which is
equal to the sum of the outstanding balances on any loans made by Assignee to
the Owner in the event of a Qualifying Event (as set forth in Section 5(c) of
the Agreement; and (iv) the obligation of the Owner to name the Assignee as
beneficiary for a portion of the death benefit under the Policy in the event of
the death of the insured prior to Owner's termination of employment with
Employer in accordance with Section 4 of the Agreement.

2. The Owner hereby grants to Assignee a security interest in and
collaterally assigns to Assignee the Policy and the cash value to secure the
Secured Obligations. However, the Assignee's interest in the Policy shall be
strictly limited to:

(a) The right to be paid the Assignee's portion of the death benefit in
the event of the death of the Owner prior to Owner's termination of employment
with Employer in accordance with Section 4 of the Agreement;

(b) The right to receive an amount equal to the entire cash value of the
Policy (which right may be realized by Assignee's receiving a portion of the
death benefit under the Policy or Owner's causing such amount to be transferred
to Assignee (through withdrawing from or borrowing against the Policy), in
accordance with the terms of the Agreement) if the Owner terminates employment
with Employer for a reason other than a Qualifying Termination (unless he or she
has previously attained his or her Security Release Date);

(c) The right to receive an amount equal to the sum of the outstanding
balances on any loans made by Assignee to the Owner in the event of a Qualifying
Event (as set forth in Section 5(c) of the Agreement); and

(d) The right to receive an amount equal to any federal, state or local
taxes that Assignee may be required to withhold and collect (as set forth in
Section 12 of the Agreement).

3. (a) Owner shall retain all incidents of ownership in the Policy, and
may exercise such incidents of ownership except as otherwise limited by the
Agreement and hereunder. The Insurer is only authorized to recognize (and is
fully protected in recognizing) the exercise of any ownership rights by Owner if
the Insurer determines that the Assignee has been given notice of Owner's
purported exercise of ownership rights in compliance with the provisions of
Section 3(b) hereof and as of the date thirty days after such notice is given,
the Insurer has not received written notification from the Assignee of
Assignee's objection to such exercise; provided that, the designation of the
beneficiary to receive the death benefits not otherwise payable to Assignee
pursuant to Section 4 of the Agreement may be changed by the Owner without prior

A-2
<PAGE>

notification of Assignee. The Insurer shall not be responsible to ensure that
the actions of the Owner conform to the Agreement.

(b) Assignee hereby acknowledges that for purposes of this Collateral
Security Assignment, Assignee shall be conclusively deemed to have been
properly notified of Owner's purported exercise of his or her ownership rights
as of the third business day following either of the following events: (1)
Owner mails written notice of such exercise to Assignee by United States
certified mail, postage paid, at the address below and provides the Insurer with
a copy of such notice and a copy of the certified mail receipt or (2) the
Insurer mails written notice of such exercise to Assignee by regular United
States mail, postage paid, at the address set forth below:

Advanced Micro Devices, Inc.
One AMD Place
M/S 181
Sunnyvale, California 94088

Attn: Corporate Compensation Manager

The foregoing address shall be the appropriate address for such notices to be
sent unless and until the receipt by both Owner and the Insurer of a written
notice from Assignee of a change in such address.

(c) Notwithstanding the foregoing, Owner and Assignee hereby agree that,
until Assignee's security interest in the Policy is released, Assignee shall
from time to time designate one or more individuals (the "Designee"), who may be
officers of Assignee, who shall be entitled to adjust the death benefit under
the Policy and to direct the investments under the Policy; provided, however,
that the Designee may only increase, but not decrease, the death benefit in
effect on the date that the Policy is issued; provided further, that the
Designee may only direct the investments under the Policy in funds offered by
the Insurer under the Policy. Assignee shall notify the Insurer in writing of
the identity of the Designee and any changes in the identity of the Designee.
Until Assignee's security interest in the Policy is released, no other party may
adjust the death benefit or direct the investments under the Policy without the
consent of the Assignee and the Owner.

4. If the Policy is in the possession of the Assignee, the Assignee
shall, upon request, forward the Policy to the Insurer without unreasonable
delay for endorsement of any designation or change of beneficiary or the
exercise of any other right reserved by the Owner.

5.(a) Assignee shall be entitled to exercise its rights under the
Agreement by delivering a written notice to Insurer, executed by the Assignee
and the Owner or the Owner's beneficiary, requesting either (1) a withdrawal or
nonrecourse policy

A-3
<PAGE>

loan equal to the amount to which Assignee is entitled under Sections 5, 6 or 12
of the Agreement and transfer of such withdrawn or borrowed amount to Assignee
or (2) the payment to the Assignee of that portion of the death benefit under
the Policy to which the Assignee is entitled under Section 4 of the Agreement.
So long as the notice is also signed by Owner or his or her beneficiary, Insurer
shall pay or loan the specified amounts to Assignee without the need for any
additional documentation.

(b) Upon receipt of a properly executed notice complying with the
requirements of subsection (a) above, the Insurer is hereby authorized to
recognize the Assignee's claims to rights hereunder without the need for any
additional documentation and without investigating (1) the reason for such
action taken by the Assignee; (2) the validity or the amount of any of the
liabilities of the Owner to the Assignee under the Agreement; (3) the existence
of any default therein; (4) the giving of any notice required herein; or (5) the
application to be made by the Assignee of any amounts to be paid to the
Assignee. The receipt of the Assignee for any sums received by it shall be a
full discharge and release therefor to the Insurer.

6. Upon the full payment of the liabilities of the Owner to the Assignee
pursuant to the Agreement, the Assignee shall execute an appropriate release of
this Collateral Security Assignment.

7. The Assignee shall have the right to request of the Insurer and/or the
Owner notice of any action taken with respect to the Policy by the Owner.

8.(a) The Assignee and the Owner intend that in no event shall the
Assignee have any power or interest related to the Policy or its proceeds,
except as provided herein and in the Agreement, notwithstanding the provisions
of any other documents including the Policy. In the event that the Assignee
ever receives or may be deemed to have received any right or interest beyond the
limited rights described herein and in the Agreement, such right or interest
shall be held in trust for the benefit of the Owner and be held separate from
the property of the Assignee.

(b) In order to further protect the rights of the Owner, the Assignee
agrees that its rights to the Policy and proceeds thereof shall serve as
security for the Assignee's obligations to the Owner as provided in the
Agreement. Assignee hereby grants to Owner a security interest in and
collaterally assigns to Owner any and all rights it has in the Policy, and
products and proceeds thereof, whether now existing or hereafter arising
pursuant to the provisions of the Policy, the Agreement, this Collateral
Security Assignment or otherwise, to secure Assignee's obligations ("Assignee
Obligations") to Owner under the Agreement, whether now existing or hereafter
arising. The Assignee Obligations include all obligations owed by the

A-4
<PAGE>

Assignee to Owner under the Agreement, including without limitation: (i) the
obligation to purchase the Policy designating Owner as the owner and to make the
premium payments required under Section 3 of the Agreement and (ii) the
obligation to do nothing which may, in any way, endanger, defeat or impair any
of the rights of Owner in the Policy as provided in the Agreement. In no event
shall this provision be interpreted to reduce Owner's rights in the Policy or
expand in any way the rights or benefits of the Assignee under the Agreement. In
the event that Owner terminates employment with Employer for any reason prior to
a Qualifying Event, this security interest and collateral assignment granted by
Assignee to Owner shall auto matically expire and be deemed waived. Nothing in
this provision shall prevent the Assignee from receiving its share of the death
benefits under the Policy as provided in Section 4 of the Agreement.

9. Assignee and Owner agree to execute any documents necessary to
effectuate this Collateral Security Assignment pursuant to the provisions of the
Agreement. All disputes shall be settled as provided in Section 13 of the
Agreement. The rights under this Collateral Security Assignment may be enforced
pursuant to the terms of the Agreement.

IN WITNESS WHEREOF, the Owner and Assignee have executed this Collateral
Security Assignment effective the day and year first above written.

___________________________________
, Owner

ADVANCED MICRO DEVICES, INC.

By: ______________________________

Title: ___________________________

A-5
<PAGE>

EXHIBIT B

SPLIT-DOLLAR LIFE INSURANCE SECURITY RELEASE NOTICE

Pursuant to the Split-Dollar Life Insurance Agreement entered into
between Advanced Micro Devices, Inc. ("the Company") and me as of
______________, 199__ (the "Agreement"), I hereby notify the Company that I
request to be released on __________, ____ ("Security Release Date") from the
Company's collateral security interest in Policy Number ________ issued by The
Manufacturers Life Insurance Company of America. I understand that my Security
Release Date must be at least two years from the date the Company receives this
Notice. I also understand that my Security Release Date may be changed no more
than twice, and then only to a later date, not an earlier date, and that any
change in my Security Release Date must be made at least two years before the
date that would otherwise be my Security Release Date. I further understand that
in order for the Company's collateral security interest to be released on my
Security Release Date, I must continue to be employed by the Employer (as
defined in the Agreement) until such date.

______________________
Participant

Date:_________________

Received by the Company on _____________________________________________

by ______________________________________
<PAGE>

EXHIBIT C

SPOUSAL CONSENT TO DESIGNATION OF NONSPOUSAL BENEFICIARY

My spouse is _____________________. I hereby consent to the
designation made by my spouse of _______________________ as the beneficiary
(subject to any rights collaterally assigned to Advanced Micro Devices, Inc.)
under Life Insurance Policy No. _________________ which Advanced Micro Devices,
Inc. has caused The Manufacturers Life Insurance Company of America to issue to
him/her. I also understand that this consent is valid only with respect to the
naming of the beneficiary indicated above and that the designation of any other
beneficiary will not be valid unless I consent in writing to such designation.

This consent is being voluntarily given, and no undue influence or
coercion has been exercised in connection with my consent to the designation
made by my spouse of the beneficiary named above rather than myself as the
beneficiary under the Split-Dollar Life Insurance Policy.

___________________________
Spouse's Signature

___________________________
Print Spouse's Name

Date: ______________________________
<PAGE>

EXHIBIT D

NOTICE TO POSTPONE SPLIT-DOLLAR LIFE INSURANCE SECURITY RELEASE DATE

First Election to Postpone Security Release Date
- - ------------------------------------------------

Pursuant to the Split-Dollar Life Insurance Agreement entered into
between Advanced Micro Devices (the "Company") and me as of ____________ (the
"Agreement"), I hereby notify the Company that I request to postpone my initial
Security Release Date from ____________, _______ until ___________, _____
("Security Release Date"). I understand that this first election to postpone
must be received by the Company at least two years prior to the date which would
otherwise constitute my Security Release Date. I further understand that in
order for the Company's collateral security interest to be released on my
Security Release Date as postponed, I must continue to be employed by the
Company or one of it subsidiaries until such date.

____________________________________ _______________________________
Participant Date

Received by Advanced Micro Devices

on __________________________ By ___________________________________

- - --------------------------------------------------------------------------
Second Election to Postpone Security Release Date.
- - -------------------------------------------------
Pursuant to the Split-Dollar Life Insurance Agreement entered into
between Advanced Micro Devices (the "Company") and me as of __________________
(the "Agreement"), I hereby notify the Company that I request to further
postpone by Security Release Date from ____________________, _____ until
___________________, _____. I understand that this second election to postpone
must be received by the Company at least two years prior to the date which would
otherwise constitute my Security Release Date. I further understand that in
order for the Company's collateral security interest to be released on my
Security Release Date as postponed, I must continue to be employed by the
Company or one of its subsidiaries until such date.

____________________________________ _______________________________
Participant Date

Received by Advanced Micro Devices

on ___________________ By ____________________________________________
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.35
<SEQUENCE>10
<DESCRIPTION>COMPAQ/AMD AGMT.
<TEXT>

<PAGE>

EXHIBIT 10.35

CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE BEEN DELETED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT.

COMPAQ COMPUTER CORPORATION/ADVANCED MICRO DEVICES, INC.
AGREEMENT

This Agreement ("Agreement"), effective as of January 1, 1994 (Effective
Date), is made by Compaq Computer Corporation ("Compaq") and Advanced Micro
Devices, Inc. ("AMD"). The terms and conditions contained in this Agreement
shall govern the purchase and sale of Product specified on purchase orders
issued by Compaq. For purposes of this Agreement, Product shall mean any
current or future microprocessors that are Microsoft Windows Compatible and
any Microsoft Windows Compatible follow-ons thereto that AMD either
currently makes available or plans to make available to any of its
customers. Microprocessors that are Microsoft Windows Compatible shall
include AMD's current 80X86 microprocessor family, and/or future derivatives
thereof, including any future derivative microprocessors that are based on a
similar architecture. Product shall not include any of AMD's custom or
customer specific products (Custom Products). Custom Products shall mean
product that: (i) contains significant functional differences from Product
sold by AMD, and (ii) is sold to only one customer.

1. INTENT AND ROAD MAP MEETINGS

A. Compaq intends to enter into a long-term relationship with AMD. As such, AMD
is willing to cooperate with Compaq to further mutual long-term goals by
sharing Product road map and technology directions. During the term of this
Agreement, the parties agree to meet at least on a quarterly basis to review
AMD's Product road map (excluding Custom Products) and technology directions
(Road Map Meeting). The topics discussed shall include Product
specifications, anticipated prices, existing and planned capacity, projected
schedules and availability dates. Compaq shall provide feedback to AMD
regarding those items in AMD's Product road map which may be of interest to
Compaq based on Compaq's product plans. Compaq may disclose to AMD those
products in Compaq's road map which Compaq believes will pertain to AMD's
Products. [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION] On an ongoing basis, Compaq may provide
AMD with input on the specifications of AMD's future Products.

Compaq also expects that AMD will cooperate to achieve Compaq's long-term
program goals such as shortening Product lead-times, increasing volume
flexibility, achieving Just-in-Time delivery at all of Compaq's
manufacturing sites, achieving ongoing cost reductions and specific quality
goals, and continuous quality improvement.

B. Unless expressly stated otherwise for a particular Product, this Agreement
is not a requirements contract and does not obligate Compaq to purchase any
minimum quantity of Product but only establishes the terms and conditions
for such purchases if and when they occur.

2. PURCHASE ORDERS

A. Compaq will purchase Products only by issuing purchase orders ("Order or
Orders") to AMD. Orders shall contain such things as quantity, price,
desired delivery date, part number, and revision level. Compaq shall make
commercially reasonable efforts to send written confirmation (except by
mutual agreement) of Orders within one (1) week after issuance. AMD shall
sign and return the acknowledgment copy of the Order within five (5)
<PAGE>

days after receipt. If AMD fails to return the acknowledgment, AMD will be
deemed to have accepted any Order which conforms with the terms of this
Agreement. Acceptance by AMD is limited to the terms of Compaq's offer as
contained in this Agreement and the Order. No additional or different
provisions proposed by AMD shall apply unless expressly agreed to in writing
by Compaq. Compaq hereby gives notice of its objection to any additional or
different terms.

B. AMD agrees that all Compaq sites, and subsidiaries, wherever located, shall
be entitled to make purchases under this Agreement. In addition, at Compaq's
request, AMD agrees to drop ship Product to Compaq's subcontractors.

3. EARLY PRODUCTION PRODUCT AND TESTING

AMD agrees to provide Compaq with prototypes and early production samples of
Product for all new Products that Compaq notifies AMD it wishes to receive.
AMD shall use reasonable efforts to provide such prototypes and samples to
Compaq as soon as they become available, and [CONFIDENTIAL INFORMATION
OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].
Compaq will use reasonable efforts to evaluate and test such prototypes and
early production samples of Product received from AMD and provide AMD with
feedback regarding Compaq's test results.

4. TERM OF AGREEMENT

A. The term of this Agreement shall be for [CONFIDENTIAL INFORMATION OMITTED
AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] (Term),
commencing on the Effective Date, unless extended pursuant to Section 4.B.
or 4.C. below.

B. The Term of this Agreement may be [CONFIDENTIAL INFORMATION OMITTED AND
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE] extended for
[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]:

[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]

C. This Agreement shall be automatically renewed at the conclusion of the Term
for successive [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] periods unless one of the parties
indicates by written notice to the other party not less than [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] prior to the end of the Term that it does not intend to renew
the Agreement. Notwithstanding the foregoing, the Agreement shall remain in
full force and effect and shall be applicable to any Order(s) issued by
Compaq to AMD during the Term of this Agreement until any and all
obligations of the parties under such Order(s) have been fulfilled.
<PAGE>

5. [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] PRODUCT & NEW CAPACITY

A. AMD shall offer for purchase by Compaq all new Products that AMD markets or
intends to market. AMD agrees that Compaq shall have the [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] made available by AMD, except for [CONFIDENTIAL INFORMATION
OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]
that are equivalent in form, fit, function and performance to products from
other third party suppliers and such third party suppliers' products are
used in computer systems which are generally available in the marketplace
("Equivalent Products"). For each Product that Compaq [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION], AMD agrees that each such Product will include any similar
Product which does not have significant functional or performance
differences.

B. The parties agree to negotiate a separate agreement for any co-developed
product, and any exclusivity benefits desired by Compaq will be as set forth
in such separate agreement.

C. [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]

[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]

For Equivalent Product, Compaq will be entitled, for a period or six (6)
months following first production shipment of such Equivalent Product,
[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].

D. If, at any time during the [CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] of a particular
Product, a third party ships a product such that AMD's Product now can be
classified as an Equivalent Product, then AMD may, at its option, and upon
written notice to Compaq, immediately terminate Compaq's [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] for that particular Product, except that Compaq shall be
entitled to the [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION] for a period of six (6) months from
the date that Compaq's [CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].

E. AMD shall notify Compaq if and when AMD builds or obtains new or additional
production capacity so that Compaq may, at its option elect to forecast (as
shown in Exhibit A) and/or order more Product.

6. PRICING

A. [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] days prior to the end of the then-current quarter,
Compaq and AMD shall meet to review pricing for the following quarter
(Pricing Meeting). At the Pricing Meeting, Compaq and AMD shall agree on the
price for Product
<PAGE>

for the following quarter, subject to the conditions specified in this
Section 6. In addition, Compaq and AMD will, by mutual agreement, review and
update Buyer's forecast and [CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] as shown in Exhibit
A.

B. Prices shall include all charges such as packaging, packing, crating,
storage, forwarding agent or brokerage fees, document fees and duties.
Prices shall also include any and all sales, use, excise and similar taxes.
Compaq shall not accept Product at any price above that indicated on the
Order.

C. AMD acknowledges that [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION], AMD represents that, subject
to this Section 6, the [CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION]:

[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION]

[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]

D. [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]

E. [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]

AMD may, upon reasonable notice to Compaq, appoint an independent auditor to
review Compaq's records to determine if Compaq has [CONFIDENTIAL INFORMATION
OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] as
specified herein. Compaq shall allow such independent auditor access to all
applicable records of Compaq for the purpose of conducting such audit. The
independent auditor shall only report to AMD whether Compaq has
[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION], as the case may be.

F. [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION]

G. Compaq may, upon reasonable notice to AMD, appoint an independent auditor to
review AMD's records to determine if Compaq is receiving pricing as agreed
to hereunder and that AMD is complying with the terms of this Agreement. AMD
shall allow such independent auditor access to all applicable records of AMD
for the purpose of conducting such audit. The independent auditor shall only
report to Compaq whether AMD is complying with the terms of this Agreement.

H. Compaq shall be entitled to purchase Product from AMD at an Effective Price
[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] equal to the lesser of: (i) the [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION].
<PAGE>

I. AMD shall maintain a vigorous cost reduction program to ensure that pricing
is competitive at all times. In the event that Compaq does not consider
AMD's pricing aggressive relative to the market, Compaq shall have the right
to request an immediate meeting with AMD to renegotiate pricing.

J. [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION].

K. AMD may wish to obtain additional capacity from one or more foundries, and
it may be necessary, as part of AMD's agreement with such foundries, for AMD
to permit the foundries to internally consume certain quantities of
[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] Product which is the same or similar to Product
that Compaq is entitled to purchase. Compaq agrees that AMD may permit such
foundries to internally consume up to 135,000 units of Product per year
(aggregate for all foundries) without any requirement by AMD to
[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] pursuant to Section 6.C above because of AMD's
arrangements with such foundries.

In the event that AMD's arrangements with such foundries permits such
foundries to internally consume Product in quantities greater than 135,000
in 1994, Compaq shall be entitled to purchase from AMD an amount equal to
the quantities above 135,000 per year that such foundries are internally
consuming, at [CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION]. If Compaq is not purchasing
Products comparable to those that the foundries are consuming internally,
Compaq will be eligible for a [CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] of the nearest
comparable Product.

In the event that AMD's arrangement with such foundries permits such
foundries to internally consume Product in quantities greater than 135,000
in 1995 and 1996, Compaq shall be entitled to purchase from AMD: (i) an
amount equal to the quantities above 135,000 per year and less than 270,000
per year that such foundries are internally consuming at a [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] Compaq is otherwise [CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].

L. As specified in Section 7.E. below and Exhibit D, AMD agrees to have certain
backup capacity available to Compaq for quantities over and above forecasted
quantities as specified in Exhibit A. In the event that Compaq utilizes the
backup capacity, the following prices apply. For the first [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION] Product purchased from the backup capacity [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION].

M. Compaq agrees that Product purchased under this Agreement will be
incorporated into Compaq's products except that Compaq may sell Product to
its distributors and end-users for use as replacement parts, upgrades parts
and/or spare parts.

N. AMD agrees that Compaq will be [CONFIDENTIAL INFORMATION OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION] relative to any
<PAGE>

of it's other customers with respect to [CONFIDENTIAL INFORMATION OMITTED
AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION].

7. DELIVERY

A. Compaq's Order shall state delivery dates for Product delivery by AMD on the
committed date and shall be considered to be of equal importance as quality
and price in meeting Compaq's requirements. Delivery performance shall be
measured by on-dock date at Compaq's specified ship-to location. AMD
represents and warrants that it will use its best efforts to at all times
meet the delivery dates for Products on the committed delivery date.

B. All sales are F.O.B. Point of Shipment. Title and risk of loss shall pass to
Compaq upon AMD's delivery of Product purchased hereunder to carrier
authorized by Compaq.

C. If AMD delivers Product more than three (3) days in advance of the specified
delivery date, Compaq may either return such Product at AMD's risk and
expense for subsequent delivery on the specified delivery date or retain
such material and make payment when it would have been due based on the
specified delivery date.

D. Changes to delivery dates may only be made by Compaq's authorized purchasing
representatives. All other schedule changes are at AMD's risk. Compaq may,
without cost or liability, issue change requests for Product quantities and
schedule dates in accordance with the Flexibility Agreement attached as
Exhibit D ("Flexibility Agreement"). Written confirmation will be sent by
AMD to Compaq within two (2) work days of receiving such change request, and
Compaq shall provide a confirming Order change within ten (10) working days
of receiving AMD's confirmation.

E. In addition, AMD agrees to have available backup capacity as specified in
Exhibit D. The quarterly backup capacity quantities specified in Exhibit D
represent Compaq's backup requirements for each quarter. The amounts listed
for each quarter may be divided equally over the thirteen (13) weeks in the
particular quarter. AMD agrees to supply such quantities in the quarter
indicated upon eight (8) weeks written notice from Compaq of the need for
the particular Product. In the event that Compaq does not need the backup
capacity indicated above for a particular Product and quarter, Compaq will
lose that backup capacity. In the event that AMD is unable to supply the
backup capacity for a particular Product and quarter, Compaq may increase
the backup capacity on another Product by the amount that AMD is unable to
supply. Compaq and AMD shall update the quarterly backup capacity amounts on
a rolling quarterly basis through 4Q95. Unless otherwise agreed to in
writing, the backup capacity amounts for 1995 shall be a minimum of
[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION] per quarter.

F. AMD shall notify Compaq in writing immediately if AMD has knowledge of any
impending material shortage, labor dispute, or other event which could
result in any change to the agreed delivery plan.

G. In the event that Product scheduled for delivery is more than one (1)
business day late, Compaq may request such Product to be shipped and
delivered via a different mode of transportation. In such event, AMD agrees
to pay or reimburse Compaq for all transportation charges in excess of the
normal charges. Compaq agrees to discuss with AMD mutually acceptable
alternatives that might be available for securing substitute for Product.
Compaq agrees to attempt, with AMD's assistance, and as time allows, to
obtain
<PAGE>

Product from AMD's authorized distributors at no additional charge to
Compaq. Compaq also agrees to make reasonable attempts to adjust orders
placed with other third party vendors and/or adjust Compaq production
schedules before incurring additional reprocurement costs. If Compaq cannot
obtain Product in a timely fashion from AMD or AMD's authorized
distributors, then, Compaq may purchase substitute for Product elsewhere.
Without affecting other remedies Compaq may have, Compaq may [CONFIDENTIAL
INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION].

8. PACKING, MARKING, AND SHIPPING INSTRUCTIONS

A. All Product shall be prepared and packed in a commercially reasonably manner
so as to secure the lowest transportation rates and meet carrier's
requirements or those set forth in the Product specification attached as
Exhibit B ("Specification").

B. Each shipping container shall be marked to show Compaq's Order number, part
number, revision level, lot number, and quantity contained therein. A
packing list showing the Order number shall be included in each container.

C. AMD agrees to standardize the count multiples used in shipments so that
Compaq can verify the quantity of each shipment.

9. QUALITY

A. AMD agrees to use its best efforts to deliver defect-free materials to
Compaq at all times. AMD shall establish and/or maintain a quality
improvement plan acceptable to Compaq. AMD's Quality Improvement Plan is
attached to this Agreement as Exhibit C ("Quality Plan").

B. At Compaq's request, AMD will facilitate on-site visits and inspections by
Compaq. Such inspections shall take place during normal business hours at
AMD's facilities. AMD shall, as far as reasonably practicable, assist
Compaq's personnel in the conduct of this inspection. Compaq's inspections
shall in no way relieve AMD of its obligation to deliver conforming Product
or waive Compaq's right of inspection and acceptance at the time the
Products are delivered.

C. AMD agrees to provide relevant outgoing inspection, quality, and reliability
data upon Compaq's request.

D. AMD agrees