Infineon and LSI Logic Announce Agreement to Cooperate in Development of Intellectual Property and System-on-Chip ICs for Hard Disk Drive Applications

Munich, Germany and Milpitas, Calif. – August 20, 2002 - Infineon Technologies (FSE/NYSE: IFX) and LSI Logic Corporation (NYSE: LSI) today announced they have entered into a joint development agreement (JDA) to share existing intellectual property (IP), to jointly develop new IP and to collaborate on the design of integrated circuits for hard disk drive (HDD) applications.

The agreement, which allows each company to market System-on-Chip ICs developed individually or jointly, gives Infineon and LSI Logic access to all of the advanced functionality needed to meet requirements for desktop and mobile HDD products. Infineon and LSI Logic expect that initial products resulting from the JDA will be available beginning in second half 2003.

"The LSI Logic-Infineon R&D cost-sharing agreement is expected to expand the market opportunities for both companies in the hard-disk drive space, while bringing time-to-market advantages to customers," said Dave Reinsel, Research Manager, Storage, Hard Disk Drives and Components, IDC. "The agreement also enhances the competitive position of both companies in this global market and provides their customers with the benefits of the combined intellectual property strengths of these two technology leaders."

These technologies include Infineon's recently-announced 1.6 Gb/sec read channel, SERIAL-ATA™ and Fibre Channel interfaces based on LSI Logic's proven GigaBlaze® transceiver core technology, 10 bit Error Correction Code and processor subsystem IP.

Access to these important IP blocks enables both parties to address all the IP needed to meet the requirements of the enterprise, desktop and mobile HDD markets for integrated read channel and serial interface system-on-a-chip (SOC) devices.

"This technology sharing agreement between Infineon and LSI Logic provides new, cost-effective system-on-chip opportunities for customers in the hard disk drive business," said David Jones, LSI Logic Storage and Computing ASIC Products vice president. "This agreement also expands market opportunities for our respective companies, while allowing each of us to reduce our R&D costs. Combining Infineon's leading edge read channel with LSI Logic's demonstrated transceiver technology and processor subsystem design expertise, will provide HDD customers with product differentiation capability and improved time to market."

"Providing low-cost, high-performance interfaces for storage applications is key for this industry," said Peter Schiefer, general manager and vice president, Business Unit Network and Computer Storage, Infineon Technologies. "We are blending LSI Logic's interface and system-level integration leadership with Infineon's high-data-rate read channel expertise, and combining our companies' engineering resource efforts to achieve SOC integration. This, along with our advanced high-volume manufacturing capabilities, will give our customers an edge in today's highly competitive time-to-market business."

About Infineon
Infineon Technologies AG, Munich, Germany, offers semiconductor and system solutions for applications in the wired and wireless communications markets, for security systems and smartcards, for the automotive and industrial sectors, as well as memory products. With a global presence, Infineon operates in the US from San Jose, CA, in the Asia-Pacific region from Singapore and in Japan from Tokyo. In the fiscal year 2001 (ending September), the company achieved sales of Euro 5.67 billion with about 33,800 employees worldwide. Infineon is listed on the DAX index of the Frankfurt Stock Exchange and on the New York Stock Exchange (ticker symbol: IFX). Further information is available at www.infineon.com .

About LSI Logic Corporation
LSI Logic Corporation (NYSE: LSI) is a leading designer and manufacturer of communications, consumer and storage semiconductors for applications that access, interconnect and store data, voice and video. In addition, the company supplies storage network solutions for the enterprise. LSI Logic is headquartered at 1621 Barber Lane, Milpitas, CA 95035. Further information is available at www.lsilogic.com .

Infineon and the stylized Infineon Technologies design are registered trademarks and service marks of Infineon Technologies AG, and SERIAL-ATA is a trademark of Infineon Technologies North America Corp. LSI Logic, the LSI Logic logo design, and GigaBlaze® are trademarks or registered trademarks of LSI Logic Corporation. Other product and brand names may be trademarks or registered trademarks of their respective owners.

Forward-Looking and Cautionary Statements
Except for the historical information and discussions contained herein, statements contained in this release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve a number of risks, uncertainties and other factors, for example, the semiconductor industry cycles, technological challenges, technical difficulty of manufacturing integrated circuits for hard disk drive (HDD) applications that could cause actual results to differ materially as discussed in the respective company's filings with the United States Securities and Exchange Commission and other applicable government filings, as well as cautionary statements and other factors set forth as Risk Factors therein. The forward-looking statements are made as of the release date hereof and the companies disclaim any intention or obligation to update or revise any forward-looking statements or to update the reasons why the actual results could differ materially from those projected in the forward-looking statements, whether as a result of new information, future events or otherwise.