3Dlabs & Intel Enter Agreement

Last week, 3Dlabs Inc. Ltd. sold a $7.5 million convertible subordinated note, due in 2004, to Intel Corporation. In the event Intel converts the note, 3Dlabs would issue up to an approximate 1.3 million shares of 3Dlabs common stock to Intel. Intel has been a shareholder in 3Dlabs since 1996.

The companies also entered into a license agreement in which Intel has licensed 3Dlabs' portfolio of patents for use in certain markets. Terms of this agreement were not disclosed.

"We look forward to continuing the long standing relationship between 3Dlabs and Intel," stated Osman Kent, president and CEO of 3Dlabs. "As stated before, the licensing of our intellectual property outside our core professional graphics business is part of our growth strategy.  3Dlabs' intellectual property strengths and our position as an innovator in the graphics industry are further underscored by this agreement."

3Dlabs is a supplier of integrated hardware and software graphics accelerator solutions. They also develop silicon, boards and software drivers to create products for users who rely on graphics for their productivity.

For more information about 3Dlabs or Intel, visit www.3dlabs.com or www.intel.com.