COMMON STOCK

                                                                    EXHIBIT 1.01

                               25,000,000 SHARES*

                              TRANSMETA CORPORATION

                                  COMMON STOCK



                             UNDERWRITING AGREEMENT

                                                               December 17, 2003


XXXXXXX & COMPANY, INC.
X.X. XXXXXXX & SONS, INC.
U.S. BANCORP XXXXX XXXXXXX INC.
  As Representatives of the several Underwriters
  c/o Needham & Company, Inc.
  000 Xxxx Xxxxxx
  Xxx Xxxx, Xxx Xxxx 00000

Ladies and Gentlemen:

      Transmeta Corporation, a Delaware corporation (the "Company"), proposes to
issue and sell 25,000,000 shares (the "Firm Shares") of the Company's Common
Stock, $.00001 par value per share (the "Common Stock"), to you and to the
several other Underwriters named in Schedule I hereto (collectively, the
"Underwriters"), for whom you are acting as representatives (the
"Representatives"). The Company has also agreed to grant to you and the other
Underwriters an option (the "Option") to purchase up to an additional 3,750,000
shares of Common Stock, on the terms and for the purposes set forth in Section
1(b) (the "Option Shares"). The Firm Shares and the Option Shares are referred
to collectively herein as the "Shares."

      The Company confirms as follows its agreement with the Representatives and
the several other Underwriters.

      1. Agreement to Sell and Purchase.

      (a) On the basis of the representations, warranties and agreements of the
Company herein contained and subject to all the terms and conditions of this
Agreement, (i) the Company agrees to issue and sell the Firm Shares to the
several Underwriters and (ii) each of the Underwriters, severally and not
jointly, agrees to purchase from the Company the respective number of Firm
Shares set forth opposite that Underwriter's name in Schedule I hereto, at the
purchase price of $2.726 for each Firm Share.

      (b) Subject to all the terms and conditions of this Agreement, the Company
grants the Option to the several Underwriters to purchase, severally and not
jointly, up to 3,750,000 Option Shares at the same price per

---------
*  Plus an option to purchase up to an additional 3,750,000 shares to cover
   over-allotments.

                                      -1-

share as the Underwriters shall pay for the Firm Shares. The Option may be
exercised only to cover over-allotments in the sale of the Firm Shares by the
Underwriters and may be exercised in whole or in part at any time (but not more
than once) on or before the 30th day after the date of this Agreement upon
written or telegraphic notice (the "Option Shares Notice") by the
Representatives to the Company no later than 12:00 noon, New York City time, at
least two and no more than five business days before the date specified for
closing in the Option Shares Notice (the "Option Closing Date"), setting forth
the aggregate number of Option Shares to be purchased and the time and date for
such purchase. On the Option Closing Date, the Company will issue and sell to
the Underwriters the number of Option Shares set forth in the Option Shares
Notice, and each Underwriter will purchase such percentage of the Option Shares
as is equal to the percentage of Firm Shares that such Underwriter is
purchasing, as adjusted by the Representatives in such manner as they deem
advisable to avoid fractional shares.

      2. Delivery and Payment. Delivery of the Firm Shares shall be made to the
Representatives through the facilities of the Depository Trust Company ("DTC")
for the accounts of the Underwriters, against payment of the purchase price by
wire transfer payable in same-day funds to an account specified in writing by
the Company to Xxxxxxx & Company, Inc. at least two business days in advance, at
10:00 a.m., New York City time, on the third (or, if the purchase price set
forth in Section 1(b) hereof is determined after 4:30 p.m., Washington D.C.
time, the fourth) business day following the commencement of the offering
contemplated by this Agreement, or at such time on such other date, not later
than seven business days after the date of this Agreement, as may be agreed upon
in writing by the Company and the Representatives (such date is hereinafter
referred to as the "Closing Date").

      To the extent the Option is exercised, delivery of the Option Shares
against payment by the Underwriters (in the manner specified above) will take
place at the offices specified above for the Closing Date at the time and date
(which may be the Closing Date) specified in the Option Shares Notice.

      The documents to be delivered at the Closing Date or the Option Closing
Date, as the case may be, by or on behalf of the parties hereto pursuant to
Section 5 hereof, will be delivered at the offices of Fenwick & West LLP, 000
Xxxxxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxx 00000 (the "Closing Location"). A
meeting will be held at the Closing Location at 1:00 p.m., California time, on
the business day next preceding such Closing Date or Option Date, at which
meeting the final drafts of the documents to be delivered pursuant to Section 5
will be available for review by the parties hereto.

      Certificates evidencing the Shares shall be in definitive form and shall
be registered in such names and in such denominations as the Representatives
shall request at least two business days prior to the Closing Date or the Option
Closing Date, as the case may be, by written notice to the Company. For the
purpose of expediting the checking and packaging of certificates for the Shares,
the Company agrees to make such certificates available for inspection at least
24 hours prior to the Closing Date or the Option Closing Date, as the case may
be, at the offices of DTC or its designated custodian.

      The cost of original issue tax stamps and other transfer taxes, if any, in
connection with the issuance and delivery of the Firm Shares and Option Shares
by the Company to the respective Underwriters shall be borne by the Company. The
Company will pay and save each Underwriter and any subsequent holder of the
Shares harmless from any and all liabilities with respect to or resulting from
any failure or delay in paying federal and state stamp and other transfer taxes,
if any, which may be payable or determined to be payable in connection with the
original issuance or sale to such Underwriter of the Shares.

      3. Representations and Warranties of the Company. The Company represents,
warrants and covenants to each Underwriter that:

      (a) The Company meets the requirements for use of Form S-3, and a
registration statement (Registration No. 333-107113) on Form S-3 (the "Initial
Registration Statement") relating to the Shares, including a final prospectus
supplement, a preliminary prospectus supplement and such amendments to such
registration statement as may have been required to the date of this Agreement,
has been prepared by the Company under the provisions of the Securities Act of
1933, as amended (the "Act"), and the rules and regulations (collectively
referred to as the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") thereunder, and has been filed with the
Commission. The term "preliminary prospectus" as used herein means each
preliminary prospectus,


                                      -2-

including the documents incorporated by reference therein, and any amendment or
supplement thereto, included in the Initial Registration Statement or filed with
the Commission pursuant to Rule 424(a) under the Act. Copies of such
registration statement and amendments and of each related preliminary prospectus
have been delivered to the Representatives. A final prospectus supplement
containing the information referred to in Rule 424(b)(2) of the Rules and
Regulations in respect of the offering of the Shares will be filed by the
Company with the Commission in accordance with, and within the time period
required by, the appropriate subsection of Rule 424(b) of the Rules and
Regulations. The term "Registration Statement" means the Initial Registration
Statement as amended at the time it became effective, including all documents
incorporated by reference therein, financial statements and all exhibits and
schedules thereto and any information deemed to be included by Rule 430A, and
includes any registration statement relating to the offering contemplated by
this Agreement and filed pursuant to Rule 462(b) of the Rules and Regulations (a
"Rule 462(b) Registration Statement"). As used herein, the "Effective Date",
when used in connection with the Registration Statement, shall mean (i) as to
the Initial Registration Statement, the date the Initial Registration Statement
became effective and (ii) as to any Rule 462(b) Registration Statement, the date
such Rule 462(b) Registration Statement became effective. The term "Prospectus"
means the prospectus and the preliminary prospectus supplement, including the
documents incorporated by reference therein and any supplement thereto, as most
recently filed or transmitted for filing with the Commission on or prior to the
date hereof pursuant to Rule 424(b) of the Rules and Regulations. Any reference
to the Prospectus as amended or supplemented shall be deemed to refer to and
include the Prospectus as amended or supplemented in respect of the Shares to
include the final prospectus that includes the information referred to in Rule
424(b)(2) of the Rules and Regulations in the form in which it is filed with the
Commission pursuant to Rule 424(b) of the Rules and Regulations, and in
accordance with Section 4(b) hereof, including any documents incorporated by
reference therein as of the date of such filing. Any reference herein to the
terms "amend," "amendment" or "supplement" with respect to the Registration
Statement, any preliminary prospectus or the Prospectus shall be deemed to refer
to and include the filing of any document under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), after the Effective Date, the date of any
preliminary prospectus or the date of the Prospectus, as the case may be, and
deemed to be incorporated therein by reference.

      (b) No order preventing or suspending the use of any preliminary
prospectus has been issued by the Commission, and no stop order suspending the
effectiveness of any Registration Statement or any post-effective amendment
thereto has been issued, and, to the knowledge of the Company, no proceeding for
that purpose has been initiated or threatened by the Commission. On the
Effective Date, the date the Prospectus is first filed with the Commission
pursuant to Rule 424(b) (if required), the Closing Date and, if later, the
Option Closing Date and when any post-effective amendment to the Registration
Statement becomes effective or any amendment or supplement to the Prospectus is
filed with the Commission, the Registration Statement and the Prospectus (as
amended or as supplemented if the Company shall have filed with the Commission
any amendment or supplement thereto), including the consolidated financial
statements included in the Prospectus, did and will comply with all applicable
provisions of the Act, the Exchange Act, the rules and regulations under the
Exchange Act (the "Exchange Act Rules and Regulations"), and the Rules and
Regulations and will contain all statements required to be stated therein in
accordance with the Act, the Exchange Act, the Exchange Act Rules and
Regulations, and the Rules and Regulations. On the Effective Date and when any
post-effective amendment to the Registration Statement becomes effective, no
part of the Registration Statement, the Prospectus or any such amendment or
supplement thereto did or will contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading. At the Effective Date, the
date the Prospectus or any amendment or supplement to the Prospectus is filed
with the Commission and at the Closing Date and, if later, the Option Closing
Date, the Prospectus and any such amendment or supplement to the Prospectus did
not and will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading. The foregoing
representations and warranties in this Section 3(b) do not apply to any
statements or omissions made in reliance on and in conformity with information
relating to any Underwriter furnished in writing to the Company by the
Representatives specifically for inclusion in the Registration Statement or
Prospectus or any amendment or supplement thereto. The Company acknowledges that
the statements set forth in the second, ninth, tenth, eleventh, twelfth,
thirteenth, and fourteenth paragraphs under the heading "Underwriting" in the
Prospectus constitute the only information relating to any Underwriter furnished
in writing to the Company by the Representatives specifically for inclusion in
the Registration Statement.


                                      -3-

      (c) The documents that are incorporated by reference in the Prospectus and
the Prospectus, as amended or supplemented, or from which information is so
incorporated by reference, when they became or become effective or were or are
filed with the Commission, as the case may be, complied or will comply in all
material respects with the requirements of the Act or the Exchange Act, as
applicable, and the Rules and Regulations or the Exchange Act Rules and
Regulations, as applicable; and any documents so filed and incorporated by
reference subsequent to the Effective Date shall, when they are filed with the
Commission, comply in all material respects with the requirements of the Act or
the Exchange Act, as applicable, and the Rules and Regulations or the Exchange
Act Rules and Regulations, as applicable.

      (d) The Company does not own, and at the Closing Date and, if later, the
Option Closing Date, will not own, directly or indirectly, any shares of stock
or any other equity or long-term debt securities of any corporation or have any
equity interest in any corporation, firm, partnership, joint venture,
association or other entity, other than the subsidiaries listed in Exhibit 21.01
to the Company's registration statement (Registration No. 333-44030) on Form S-1
and other than Transmeta World Inc., Taiwan Branch and Transmeta, K.K., which
alone or taken together would not constitute a "significant subsidiary" within
the meaning of Rule 1-02 of Regulation S-X (together with the subsidiaries
listed in Exhibit 21.01 to the Company's registration statement (Registration
No. 333-44030) on Form S-1, the "Subsidiaries"). The Company and each of its
Subsidiaries is, and at the Closing Date and, if later, the Option Closing Date,
will be, a corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation. The Company and each of its
Subsidiaries has, and at the Closing Date and, if later, the Option Closing
Date, will have, full power and authority to own or lease all the assets owned
or leased by it and to conduct its business as described in the Registration
Statement and the Prospectus. The Company and each of its Subsidiaries is, and
at the Closing Date and, if later, the Option Closing Date, will be, duly
licensed or qualified to do business and in good standing as a foreign
corporation in all jurisdictions in which the nature of the activities conducted
by it or the character of the assets owned or leased by it makes such license or
qualification necessary, except to the extent that the failure to be so
qualified or be in good standing would not reasonably be expected to be
materially and adversely affect the Company and its Subsidiaries, taken as a
whole, or their respective businesses, properties, business prospects,
conditions (financial or other) or results of operations, taken as a whole (such
effect is referred to herein as a "Material Adverse Effect"). All of the
outstanding shares of capital stock of each Subsidiary have been duly authorized
and validly issued and are fully paid and nonassessable, and owned by the
Company free and clear of all claims, liens, charges and encumbrances; there are
no securities outstanding that are convertible into or exercisable or
exchangeable for capital stock of any Subsidiary. The Company and its
Subsidiaries are not, and at the Closing Date and, if later, the Option Closing
Date, will not be, engaged in any discussions or a party to any agreement or
understanding, written or oral, regarding the acquisition of an interest in any
corporation, firm, partnership, joint venture, association or other entity where
such discussions, agreements or understandings would require amendment to the
Registration Statement pursuant to applicable securities laws. Complete and
correct copies of the certificate or articles of incorporation and of the
by-laws or other organizational documents of the Company and each of its
Subsidiaries and all amendments thereto have been delivered to the
Representatives, and no changes therein will be made subsequent to the date
hereof and prior to the Closing Date or, if later, the Option Closing Date.

      (e) The Company has authorized, issued and outstanding capital stock as
set forth under the caption "Capitalization" in the Prospectus as of the date
set forth therein. All of the outstanding shares of capital stock of the Company
have been duly authorized, validly issued and are fully paid and nonassessable
and were issued in compliance with all applicable state and federal securities
laws; the Shares have been duly authorized and when issued and paid for as
contemplated herein will be validly issued, fully paid and nonassessable; no
preemptive or similar rights exist with respect to any of the Shares or the
issue and sale thereof. The description of the capital stock of the Company
incorporated by reference in the Registration Statement, the Prospectus and the
Prospectus as amended or supplemented is, and at the Closing Date and, if later,
the Option Closing Date, will be, complete and accurate in all material
respects. Except as set forth in the Prospectus, the Company does not have
outstanding, and at the Closing Date and, if later, the Option Closing Date,
will not have outstanding, any options to purchase, or any rights or warrants to
subscribe for, or any securities or obligations convertible into, or any
contracts or commitments to issue or sell, any shares of capital stock, or any
such warrants, convertible securities or obligations except for options, rights,
warrants, securities, obligations, contracts or commitments issued pursuant to
employee stock option or purchase plans disclosed in the Prospectus. No further
approval or authority of stockholders or the Board of Directors of the Company
will be required for the issuance and sale of the Shares as contemplated herein.
The


                                      -4-

certificates evidencing the Shares are in due and proper legal form and have
been duly authorized for issuance by the Company.

      (f) The financial statements and schedules included or incorporated by
reference in the Registration Statement or the Prospectus present fairly the
financial condition of the Company and its consolidated Subsidiaries as of the
respective dates thereof and the results of operations and cash flows of the
Company and its consolidated Subsidiaries for the respective periods covered
thereby, all in conformity with generally accepted accounting principles applied
on a consistent basis throughout the entire period involved, except as otherwise
disclosed in the Prospectus. No other financial statements or schedules of the
Company are required by the Act, the Exchange Act, the Exchange Act Rules and
Regulations or the Rules and Regulations to be included in the Registration
Statement or the Prospectus. Ernst & Young LLP (the "Accountants"), who have
reported on such financial statements and schedules, are independent accountants
with respect to the Company as required by the Act and the Rules and
Regulations. The summary and selected consolidated financial data included in
the Registration Statement present fairly the information shown therein and have
been compiled on a basis consistent with the audited financial statements
presented in the Registration Statement.

      (g) Subsequent to the respective dates as of which information is given in
the Registration Statement, the Prospectus and the Prospectus as amended and
supplemented and prior to or on the Closing Date and, if later, the Option
Closing Date, except as set forth in or contemplated by the Registration
Statement, the Prospectus and the Prospectus as amended and supplemented, (i)
there has not been and will not have been any change in the capitalization of
the Company (other than in connection with the grant or exercise of options to
purchase the Company's Common Stock granted pursuant to the Company's stock
option plans from the shares reserved therefor as described in the Registration
Statement), and there has not been any Material Adverse Effect arising for any
reason whatsoever, (ii) neither the Company nor any of its Subsidiaries has
incurred, except in the ordinary course of business as described in the
Prospectus and the Prospectus as amended and supplemented, any liabilities or
obligations, direct or contingent that are material to the consolidated
financial position of the Company, nor has the Company or any of its
Subsidiaries entered into, except in the ordinary course of business as
described in the Prospectus and the Prospectus as amended and supplemented, any
transactions other than pursuant to this Agreement and the transactions referred
to herein that are material to the business of the Company and its Subsidiaries
taken as a whole and (iii) the Company has not and will not have paid or
declared any dividends or other distributions of any kind on any class of its
capital stock.

      (h) The Company is not, will not become as a result of the transactions
contemplated hereby, and will not conduct its business in a manner that would
cause it to become, an "investment company" or an "affiliated person" of, or
"promoter" or "principal underwriter" for, an "investment company," as such
terms are defined in the Investment Company Act of 1940, as amended.

      (i) Except as set forth in the Registration Statement and the Prospectus,
there are no actions, suits or proceedings pending or, to the knowledge of the
Company, threatened against or affecting the Company, or any of its Subsidiaries
or any of its or their officers in their capacity as such, before or by any
federal or state court, commission, regulatory body, administrative agency or
other governmental body, domestic or foreign, wherein an unfavorable ruling,
decision or finding, individually or in the aggregate, might have a Material
Adverse Effect.

      (j) The Company and each Subsidiary has, and at the Closing Date and, if
later, the Option Closing Date, will have, performed all the obligations
required to be performed by it, and is not, and at the Closing Date, and, if
later, the Option Closing Date, will not be, in default, under any contract or
other instrument to which it is a party or by which its property is bound or
affected, which default would reasonably be expected to have a Material Adverse
Effect. To the best knowledge of the Company, no other party under any contract
or other instrument to which it or any of its Subsidiaries is a party is in
default in any respect thereunder, which default would reasonably be expected to
have a Material Adverse Effect. Neither the Company nor any of its Subsidiaries
is, and at the Closing Date and, if later, the Option Closing Date, will be, in
violation of any provision of its certificate or articles of organization or
by-laws or other organizational documents.

      (k) No consent, approval, authorization or order of, or any filing or
declaration with, any court or governmental agency or body is required for the
consummation by the Company of the transactions on its part


                                      -5-

contemplated herein, except such as have been obtained under the Act or the
Rules and Regulations and such as may be required under state securities or Blue
Sky laws or the by-laws and rules of the National Association of Securities
Dealers, Inc. (the "NASD") in connection with the purchase and distribution by
the Underwriters of the Shares.

      (l) The Company has full corporate power and authority to enter into this
Agreement. This Agreement has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding agreement of the Company,
enforceable against the Company in accordance with the terms hereof. The
performance of this Agreement and the consummation of the transactions
contemplated hereby will not result in the creation or imposition of any lien,
charge or encumbrance upon any of the assets of the Company pursuant to the
terms or provisions of, or result in a breach or violation of any of the terms
or provisions of, or conflict with or constitute a default under, or give any
party a right to terminate any of its obligations under, or result in the
acceleration of any obligation under, the certificate or articles of
incorporation or by-laws of the Company or any of its Subsidiaries, any
indenture, mortgage, deed of trust, voting trust agreement, loan agreement,
bond, debenture, note agreement or other evidence of indebtedness, lease,
contract or other agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which the Company, any of its Subsidiaries or any
of its or their properties is bound or affected, or violate or conflict with any
judgment, ruling, decree, order, statute, rule or regulation of any court or
other governmental agency or body applicable to the business or properties of
the Company or any of its Subsidiaries.

      (m) The Company and its Subsidiaries have good and marketable title to all
properties and assets described as owned by them, free and clear of all liens,
charges, encumbrances or restrictions, except such as are described in the
Prospectus or are not material to the business of the Company or its
Subsidiaries. The Company and its Subsidiaries have valid, subsisting and
enforceable leases for the properties leased by them, except such as are
described in the Prospectus or are not material to the business of the Company
or its Subsidiaries. The Company and its Subsidiaries own or lease all such
properties as are necessary to their operations as now conducted or as proposed
to be conducted as described in the Prospectus, except where the failure to so
own or lease would not have a Material Adverse Effect.

      (n) There is no document, contract, permit or instrument of a character
required to be described in the Registration Statement or the Prospectus or to
be filed as an exhibit to the Registration Statement that is not described or
filed as required. All such contracts to which the Company or any of its
Subsidiaries is a party have been duly authorized, executed and delivered by the
Company or such Subsidiary, constitute valid and binding agreements of the
Company or such Subsidiary and are enforceable against and by the Company or
such Subsidiary in accordance with the terms thereof except as would not
reasonably be expected to have a Material Adverse Effect.

      (o) No statement, representation, warranty or covenant made by the Company
in this Agreement or made in any certificate or document required by Section 4
of this Agreement to be delivered to the Representatives was, when made,
inaccurate, untrue or incorrect.

      (p) The Company has not distributed and will not distribute prior to the
later of (i) the Closing Date or, if later, the Option Closing Date, and (ii)
completion of the distribution of the Shares, any offering material in
connection with the offering and sale of the Shares other than any preliminary
prospectuses, the Prospectus, the Prospectus as amended or supplemented in
respect of the Shares and filed with the Commission under Rule 424(b) of the
Rules and Regulations, the Registration Statement and other materials, if any,
permitted by the Act. Neither the Company nor any of its directors, officers or
controlling persons has taken, directly or indirectly, any action designed, or
that might reasonably be expected, to cause or result, under the Act or
otherwise, in, or that has constituted, stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Shares.

      (q) No holder of securities of the Company has rights to the registration
of any securities of the Company because of the filing of the Registration
Statement that could expose the Company to material liability or that could
impair the Company's ability to consummate the issuance and sale of the Shares
in the manner, and at the times, contemplated hereby, which rights have not been
waived by the holder thereof as of the date hereof.


                                      -6-

      (r) The Common Stock (including the Shares) has been registered under
Section 12(g) of the Exchange Act, and the Company has filed a notification to
list the Shares on the Nasdaq National Market ("NNM") and has not received
notification or inquiry which would reasonably be expected to materially and
adversely affect the listing thereof.

      (s) Except as disclosed in or specifically contemplated by the Prospectus
(i) each of the Company and each of its Subsidiaries owns or has adequate rights
to use all trademarks, trade names, domain names, patents, patent rights, patent
applications, mask works, copyrights, technology, know-how (including trade
secrets and other unpatented or unpatentable proprietary or confidential
information, systems or procedures), service marks, trade dress rights, and
other intellectual property (collectively, "Intellectual Property") and has such
other licenses, approvals and governmental authorizations, in each case,
sufficient to conduct its business as now conducted and as now proposed to be
conducted, and as described in the Prospectus, and, to the Company's and its
Subsidiaries' knowledge, none of the foregoing Intellectual Property rights
owned or licensed by the Company or any of its Subsidiaries is invalid or
unenforceable and none of the patent applications owned or licensed by the
Company or any of its Subsidiaries would reasonably be expected to be
unenforceable or invalid if issued as patents which unenforceability or
invalidity would reasonably be expected to have a Material Adverse Effect, (ii)
the Company has no knowledge of any infringement by it or any of its
Subsidiaries of Intellectual Property rights of others which infringement would
reasonably be expected to have a Material Adverse Effect, (iii) there is no
claim being made against the Company or any of its Subsidiaries or, to the
knowledge of the Company and its Subsidiaries, any employee of the Company or
any of its Subsidiaries, regarding Intellectual Property or other infringement
that could reasonably be expected to have a Material Adverse Effect, and (iv)
the Company and its Subsidiaries have not received any notice of infringement
with respect to any patent or any notice challenging the validity, scope or
enforceability of any Intellectual Property owned by or licensed to the Company
or any of its Subsidiaries which would reasonably be expected to have a Material
Adverse Effect.

      (t) The Company and each of its Subsidiaries has filed all federal, state,
local and foreign income tax returns that have been required to be filed and has
paid all taxes and assessments received by it to the extent that such taxes or
assessments have become due. Neither the Company nor any of its Subsidiaries has
any tax deficiency that has been or, to the knowledge of the Company, might be
asserted or threatened against it that could have a Material Adverse Effect.

      (u) The Company or its Subsidiaries own or possess all authorizations,
approvals, orders, licenses, registrations, other certificates and permits of
and from all governmental regulatory officials and bodies, necessary to conduct
their respective businesses as contemplated in the Prospectus, except where the
failure to own or possess all such authorizations, approvals, orders, licenses,
registrations, other certificates and permits would not have a Material Adverse
Effect. There is no proceeding pending or threatened (or any basis therefor
known to the Company) that may cause any such authorization, approval, order,
license, registration, certificate or permit to be revoked, withdrawn,
cancelled, suspended or not renewed; and the Company and each of its
Subsidiaries is conducting its business in compliance with all laws, rules and
regulations applicable thereto (including, without limitation, all applicable
federal, state and local environmental laws and regulations) except where such
noncompliance would not reasonably be expected to have a Material Adverse
Effect.

      (v) The Company and each of its Subsidiaries maintains insurance of the
types and in the amounts generally deemed adequate for its business, including,
but not limited to, insurance covering real and personal property owned or
leased by the Company and its Subsidiaries against theft, damage, destruction,
acts of vandalism and all other risks customarily insured against, all of which
insurance is in full force and effect.

      (w) Neither the Company nor any of its Subsidiaries has nor, to the best
of the Company's knowledge, any of its or their respective employees or agents
at any time during the last five years (i) made any unlawful contribution to any
candidate for foreign office, or failed to disclose fully any contribution in
violation of law, or (ii) made any payment to any federal or state governmental
officer or official, or other person charged with similar public or quasi-public
duties, other than payments required or permitted by the laws of the United
States or any jurisdiction thereof.


                                      -7-

      (x) The books, records and accounts of the Company and its Subsidiaries
accurately and fairly reflect, in reasonable detail, the transactions in, and
dispositions of, the assets of, and the results of operations of, the Company
and its Subsidiaries. The Company and each of its Subsidiaries maintains (x)
systems of internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with management's
general or specific authorizations, (ii) transactions are recorded as necessary
to permit preparation of the Company's consolidated financial statements in
accordance with generally accepted accounting principles and to maintain asset
accountability, (iii) access to assets is permitted only in accordance with
management's general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences, and
(y) disclosure controls and procedures (as defined in Rule 13a-15(e) under the
Exchange Act).

      4. Agreements of the Company. The Company covenants and agrees with the
several Underwriters as follows:

      (a) The Company will not, either prior to the Effective Date or thereafter
during such period as the Prospectus, or the Prospectus as amended or
supplemented, is required by law to be delivered in connection with sales of the
Shares by an Underwriter or dealer, file any amendment or supplement to the
Registration Statement or the Prospectus, unless a copy thereof shall first have
been submitted to the Representatives within a reasonable period of time prior
to the filing thereof and the Representatives shall not have objected thereto in
good faith.

      (b) The Company will notify the Representatives promptly, and will confirm
such advice in writing, (i) when any post-effective amendment to the
Registration Statement becomes effective, (ii) of any request by the Commission
for amendments or supplements to the Registration Statement or the Prospectus or
for additional information, (iii) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose or the threat thereof, (iv) of
the suspension of the qualification of the Shares for offering or sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose, (v) of the happening of any event during the period mentioned in the
second sentence of Section 4(e) that in the judgment of the Company makes any
statement made in the Registration Statement, the Prospectus or the Prospectus
as amended or supplemented untrue or that requires the making of any changes in
the Registration Statement, the Prospectus or the Prospectus as amended or
supplemented in order to make the statements therein, in the light of the
circumstances in which they are made, not misleading and (vi) of receipt by the
Company or any representative or attorney of the Company of any other
communication from the Commission relating to the Company, the Registration
Statement, any preliminary prospectus, the Prospectus or the Prospectus as
amended or supplemented. If at any time the Commission shall issue any order
suspending the effectiveness of the Registration Statement, the Company will use
its best efforts to obtain the withdrawal of such order at the earliest possible
moment. The Company will prepare an amendment or supplement to the Prospectus in
relation to the Shares containing the information referred to in Rule 424(b)(2)
of the Rules and Regulations in a form approved by the Representatives and will
file such amendment or supplement with the Commission pursuant to, and within
the time required by, the appropriate subsection of Rule 424(b) of the Rules and
Regulations. If the Company elects to rely upon Rule 462(b) under the Act, the
Company shall file a registration statement under Rule 462(b) with the
Commission in compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time,
on the date of this Agreement, and the Company shall at the time of filing
either pay to the Commission the filing fee for such Rule 462(b) registration
statement or give irrevocable instructions for the payment of such fee pursuant
to the Rules and Regulations.

      (c) The Company will furnish to each Representative, without charge, one
signed copy of each of the Registration Statement and of any pre- or
post-effective amendment thereto, including financial statements and schedules,
and all exhibits thereto and will furnish to the Representatives, without
charge, for transmittal to each of the other Underwriters, a copy of the
Registration Statement and any pre- or post-effective amendment thereto,
including financial statements and schedules but without exhibits.

      (d) The Company will comply with all the provisions of any undertakings
contained in the Registration Statement.


                                      -8-

      (e) On the Effective Date, and thereafter from time to time, the Company
will deliver to each of the Underwriters, without charge, as many copies of the
Prospectus or any amendment or supplement thereto as the Representatives may
reasonably request. The Company consents to the use of the Prospectus or any
amendment or supplement thereto by the Underwriters and by all dealers to whom
the Shares may be sold, both in connection with the offering or sale of the
Shares and for any period of time thereafter during which the Prospectus is
required by law to be delivered in connection therewith. If during such period
of time any event shall occur that in the judgment of the Company or counsel to
the Underwriters should be set forth in the Prospectus in order to make any
statement therein, in the light of the circumstances under which it was made,
not misleading, or if it is necessary to supplement or amend the Prospectus or
to file under the Exchange Act any document incorporated by reference in the
Prospectus to comply with law, the Company will forthwith prepare and duly file
with the Commission an appropriate supplement or amendment thereto or such
document incorporated by reference therein, and will deliver to each of the
Underwriters, without charge, such number of copies of such supplement or
amendment to the Prospectus as the Representatives may reasonably request. The
Company will not file any document under the Exchange Act or the Exchange Act
Rules and Regulations before the termination of the offering of the Shares by
the Underwriters, if such document would be deemed to be incorporated by
reference into the Prospectus, that is not approved by the Representatives after
reasonable notice thereof.

      (f) Prior to any public offering of the Shares, the Company will cooperate
with the Representatives and counsel to the Underwriters in connection with the
registration or qualification of the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Representatives may
request; provided, that in no event shall the Company be obligated to qualify to
do business in any jurisdiction where it is not now so qualified or to take any
action that would subject it to general service of process in any jurisdiction
where it is not now so subject.

      (g) The Company will, so long as required under the Rules and Regulations,
furnish to its stockholders as soon as practicable after the end of each fiscal
year an annual report (including a balance sheet and statements of income,
stockholders' equity and cash flow of the Company and its consolidated
Subsidiaries, if any, certified by independent public accountants) and, as soon
as practicable after the end of each of the first three quarters of each fiscal
year (beginning with the fiscal quarter ending after the effective date of the
Registration Statement), consolidated summary financial information of the
Company and its Subsidiaries, if any, for such quarter in reasonable detail.

      (h) During the period of five years commencing on the Effective Date, the
Company will furnish to the Representatives and each other Underwriter who may
so request copies of such financial statements and other periodic and special
reports as the Company may from time to time distribute generally to the holders
of any class of its capital stock, and will furnish to the Representatives and
each other Underwriter who may so request a copy of each annual or other report
it shall be required to file with the Commission.

      (i) The Company will make generally available to holders of its securities
as soon as may be practicable, but in no event later than the Availability Date
(as defined below), an earning statement (which need not be audited but shall be
in reasonable detail) covering a period of 12 months commencing after the
Effective Date that will satisfy the provisions of Section 11(a) of the Act
(including Rule 158 of the Rules and Regulations). For the purpose of the
preceding sentence, "Availability Date" means the 35th day after the end of the
fourth fiscal quarter following the fiscal quarter that includes such Effective
Date, except that if such fourth fiscal quarter is the last quarter of the
Company's fiscal year, "Availability Date" means the 60th day after the end of
such fourth fiscal quarter.

      (j) Whether or not the transactions contemplated by this Agreement are
consummated or this Agreement is terminated, the Company will pay or reimburse
if paid by the Representatives all costs and expenses incident to the
performance of the obligations of the Company under this Agreement and in
connection with the transactions contemplated hereby, including but not limited
to costs and expenses of or relating to (i) the preparation, printing and filing
of the Registration Statement and exhibits to it, each preliminary prospectus,
Prospectus and any amendment or supplement to the Registration Statement or
Prospectus, (ii) the preparation and delivery of certificates representing the
Shares, (iii) the printing of this Agreement, the Agreement Among Underwriters,
any Selected Dealer Agreements, any Underwriters' Questionnaires, any
Underwriters' Powers of Attorney, and any invitation letters to prospective
Underwriters, (iv) furnishing (including costs of shipping and mailing) such
copies of the Registration Statement, the Prospectus and any preliminary
prospectus, and all amendments and supplements


                                      -9-

thereto, as may be requested for use in connection with the offering and sale of
the Shares by the Underwriters or by dealers to whom Shares may be sold, (v) the
listing of the Shares on the NNM, (vi) any filings required to be made by the
Underwriters with the NASD, and the fees, disbursements and other charges of
counsel for the Underwriters in connection therewith, (vii) the registration or
qualification of the Shares for offer and sale under the securities or Blue Sky
laws of such jurisdictions designated pursuant to Section 4(f), including the
fees, disbursements and other charges of counsel to the Underwriters in
connection therewith, and the preparation and printing of preliminary,
supplemental and final Blue Sky memoranda, (viii) fees, disbursements and other
charges of counsel to the Company (but not those of counsel for the
Underwriters, except as otherwise provided herein), (ix) the transfer agent or
registrar for the Shares, and (x) any travel expenses of the Company's officers,
directors and employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the Shares.

      (k) The Company will not at any time, directly or indirectly, take any
action designed or that might reasonably be expected to cause or result in, or
that will constitute, stabilization of the price of the shares of Common Stock
to facilitate the sale or resale of any of the Shares.

      (l) The Company will apply the net proceeds from the offering and sale of
the Shares to be sold by the Company in the manner set forth in the Prospectus
under "Use of Proceeds".

      (m) During the period beginning from the date hereof and continuing to and
including the date 180 days after the date of the Prospectus as amended or
supplemented in respect of the shares and first filed with the Commission under
Rule 424(b) of the Rules and Regulations, without the prior written consent of
Xxxxxxx & Company, Inc., the Company will not (1) offer, sell, contract to sell,
pledge, grant options, warrants or rights to purchase, or otherwise dispose of
any equity securities of the Company or any other securities convertible into or
exchangeable for its Common Stock or other equity security (other than pursuant
to employee stock option or purchase plans disclosed in the Prospectus or
pursuant to the conversion of convertible securities or the exercise of warrants
in each case outstanding on the date of this Agreement), or (2) enter into any
swap or other derivatives transaction that transfers to another, in whole or in
part, any of the economic benefits or risks of ownership of shares of Common
Stock, whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Stock or other securities, in cash or
otherwise.

      (n) During the period of 180 days after the date of the Prospectus as
amended or supplemented in respect of the shares and first filed with the
Commission under Rule 424(b) of the Rules and Regulations, the Company will not
file with the Commission or cause to become effective any registration statement
relating to any securities of the Company without the prior written consent of
Xxxxxxx & Company, Inc., other than registration statements on Form S-8 or S-4
(or any successor form), or pursuant to exercise of registration rights existing
as of the date hereof, other than the exercise of those registration rights held
by Institutional Venture Management VI, L.P., Institutional Venture Management
VII, L.P., IVP Founders Fund I, L.P., Institutional Venture Partners VI, L.P.,
Institutional Venture Partners VII, L.P., Institutional Venture Partners VIII,
L.P., IVM Investment Fund VIII, LLC, IVM Investment Fund VIII-A, LLC (the "IVP
Entities") or any affiliates, partners or transferees of any of the IVP
Entities.

      (o) The Company will cause each of its executive officers, directors and
certain stockholders, who collectively hold in the aggregate 15,958,807 shares
of Common Stock, designated by the Representatives to enter into lock-up
agreements with the Representatives to the effect that they will not, without
the prior written consent of Xxxxxxx & Company, Inc., sell, contract to sell or
otherwise dispose of any shares of Common Stock or rights to acquire such shares
according to the terms set forth in Schedule II hereto, with such changes or
modifications as may be acceptable to Xxxxxxx & Company, Inc. in its sole
discretion.

      5. Conditions of the Obligations of the Underwriters. The obligations of
each Underwriter hereunder are subject to the following conditions:

      (a) All filings required by Rule 424 of the Rules and Regulations,
including, without limitation, an amendment or supplement to the Prospectus in
respect of the Shares, shall have been made. If the Company has


                                      -10-

elected to rely upon Rule 462(b), the registration statement filed under Rule
462(b) shall have become effective by 10:00 P.M., Washington, D.C. time, on the
date of this Agreement.

      (b) (i) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall be
pending or threatened by the Commission, (ii) no order suspending the
effectiveness of the Registration Statement or the qualification or registration
of the Shares under the securities or Blue Sky laws of any jurisdiction shall be
in effect and no proceeding for such purpose shall be pending before or
threatened or contemplated by the Commission or the authorities of any such
jurisdiction, (iii) any request for additional information on the part of the
staff of the Commission or any such authorities shall have been complied with to
the satisfaction of the staff of the Commission or such authorities, (iv) after
the date hereof no amendment or supplement to the Registration Statement or the
Prospectus shall have been filed unless a copy thereof was first submitted to
the Representatives and the Representatives do not object thereto in good faith,
and (v) the Representatives shall have received certificates, dated the Closing
Date and, if later, the Option Closing Date and signed by the Chief Executive
Officer and the Chief Financial Officer of the Company (who may, as to
proceedings threatened, rely upon the best of their knowledge), to the effect of
clauses (i), (ii) and (iii) of this paragraph.

      (c) Since the respective dates as of which information is given in the
Registration Statement, the Prospectus and the Prospectus as amended or
supplemented, (i) there shall not have been a material adverse change in the
general affairs, business, business prospects, properties, management, condition
(financial or otherwise) or results of operations of the Company or any of its
Subsidiaries, whether or not arising from transactions in the ordinary course of
business, in each case other than as described in or contemplated by the
Registration Statement, the Prospectus and the Prospectus as amended or
supplemented, and (ii) the Company shall not have sustained any material loss or
interference with its business or properties from fire, explosion, flood or
other casualty, whether or not covered by insurance, or from any labor dispute
or any court or legislative or other governmental action, order or decree, which
is not described in the Registration Statement, the Prospectus and the
Prospectus as amended or supplemented, if in the judgment of the Representatives
any such development makes it impracticable or inadvisable to consummate the
sale and delivery of the Shares by the Underwriters at the public offering
price.

      (d) Since the respective dates as of which information is given in the
Registration Statement, the Prospectus and the Prospectus as amended or
supplemented, there shall have been no litigation or other proceeding instituted
against the Company, any of its Subsidiaries, or any of its or their officers or
directors in their capacities as such, before or by any federal, state or local
court, commission, regulatory body, administrative agency or other governmental
body, domestic or foreign, in which litigation or proceeding an unfavorable
ruling, decision or finding would, in the judgment of the Representatives, have
a Material Adverse Effect.

      (e) Each of the representations and warranties of the Company contained
herein shall be true and correct in all respects (in the case of any
representation and warranty containing a materiality or Material Adverse Effect
qualification) or in all material respects at the Closing Date and, with respect
to the Option Shares, at the Option Closing Date, and all covenants and
agreements contained herein to be performed on the part of the Company and all
conditions contained herein to be fulfilled or complied with by the Company at
or prior to the Closing Date and, with respect to the Option Shares, at or prior
to the Option Closing Date, shall have been duly performed, fulfilled or
complied with.

      (f) The Representatives shall have received an opinion, dated the Closing
Date and, with respect to the Option Shares, the Option Closing Date,
satisfactory in form and substance to the Representatives and counsel for the
Underwriters from Fenwick & West LLP, counsel to the Company, with respect to
the following matters:

            (i) Each of the Company and Transmeta International Corporation (the
      "Delaware Subsidiary") is a corporation duly organized, validly existing
      and in good standing under the laws of its jurisdiction of incorporation;
      has full corporate power and authority to own or lease all the assets
      owned or leased by it and to conduct its business as described in the
      Registration Statement, the Prospectus and the Prospectus, as amended or
      supplemented to date; and is duly licensed or qualified to do business and
      is in good standing as a foreign corporation in all States of the United
      States in which the nature of the activities conducted by it or the
      character of the assets owned or leased by it makes such license or
      qualification necessary and where the failure to be licensed or qualified
      would have a Material Adverse Effect.


                                      -11-

            (ii) All of the issued and outstanding shares of capital stock of
      the Company have been duly authorized and validly issued and based on a
      certificate of management of the Company and a review of the Company's
      certificate of incorporation and Delaware law, are fully paid and
      nonassessable.

            (iii) The specimen certificate evidencing the Common Stock filed or
      incorporated by reference as an exhibit to the Registration Statement is
      in due and proper form under Delaware law, the Shares have been duly
      authorized and, when issued and paid for as contemplated by this
      Agreement, will be validly issued, fully paid and nonassessable; and no
      preemptive or similar rights under the Company's certificate of
      incorporation or bylaws or any similar rights contained in any other
      agreements or instruments binding upon the Company and listed on a
      schedule to such opinion exist with respect to any of the Shares or the
      issue and sale thereof.

            (iv) All of the issued and outstanding shares of capital stock of
      the Delaware Subsidiary have been duly authorized and are validly issued
      and nonassessable.

            (v) The authorized capital stock of the Company conforms, as to the
      description thereof in the Company's certificate of incorporation and
      bylaws in all material respects, to the description set forth in the
      Registration Statement, the Prospectus and the Prospectus as amended or
      supplemented under the caption "Capitalization". The description of the
      capital stock of the Company contained under the caption "Description of
      Securities to Be Registered -- Common Stock" in the Registration Statement
      and the description of the capital stock of the Company contained in the
      Form 8-A filed with the Commission on October 20, 2000 and the Form 8-A
      filed with the Commission on January 16, 2002 and incorporated by
      reference in the Registration Statement, the Prospectus and the Prospectus
      as amended or supplemented conforms to the terms thereof as set forth in
      the Company's certificate of incorporation and bylaws in all material
      respects.

            (vi) To such counsel's knowledge, there are no legal or governmental
      proceedings pending or threatened to which the Company or any of its
      Subsidiaries is a party or to which any of their respective properties is
      subject that are required to be described in the Registration Statement,
      the Prospectus or the Prospectus as amended or supplemented but are not so
      described or which, if determined adversely to the Company or its
      Subsidiaries, would, individually or in the aggregate, have a Material
      Adverse Effect.

            (vii) No consent, approval, authorization or order of, or any filing
      or declaration with, any court or governmental agency or body is required
      for the consummation by the Company of the transactions on its part
      contemplated under this Agreement, except such as have been obtained or
      made under the Act or the Rules and Regulations and such as may be
      required under state securities or Blue Sky laws or the by-laws and rules
      and regulations of the NASD in connection with the offer, purchase and
      distribution by the Underwriters of the Shares.

            (viii) The Company has full corporate power and corporate authority
      to enter into this Agreement. This Agreement has been duly authorized,
      executed and delivered by the Company.

            (ix) The execution and delivery by the Company of this Agreement,
      the performance by the Company with all of the terms hereof and the
      consummation of the transactions contemplated hereby (A) does not
      contravene any provision of the Certificate of Incorporation or By-Laws or
      other organizational documents of the Company or of the Delaware
      Subsidiary, (B) does not conflict with or result in a breach or violation
      of any of the terms or provisions of, or constitute a default under, or
      give any party a right to terminate any of its obligations under, or
      result in the acceleration of any obligation under, any agreement or
      instrument binding upon the Company and listed on a schedule to such
      opinion and (C) does not violate or conflict with (i) any judgment,
      ruling, decree or order known to such counsel of any court or governmental
      agency or body or (ii) to such counsel's knowledge, any California State
      or United States federal statute, rule or regulation applicable to the
      business or properties of the Company or of the Delaware Subsidiary.

            (x) To such counsel's knowledge, there is no document or contract of
      a character required to be described in the Registration Statement, the
      Prospectus or the Prospectus as amended or supplemented or to


                                      -12-

      be filed as an exhibit to the Registration Statement that is not described
      or filed or incorporated by reference as required.

            (xi) The statements relating to documents or matters of law included
      under the captions "Risk Factors -- Our certificate of incorporation and
      bylaws, stockholders rights plan and Delaware law contain provisions that
      could discourage or prevent a takeover, even if an acquisition would be
      beneficial to our stockholders", "Certain Transactions" and "Underwriting"
      in the Prospectus and the Prospectus as amended or supplemented, "Election
      of Directors -- Director Compensation", "Equity Compensation Plan
      Information -- Transmeta Non-Plan Option Grants" and "Related Party
      Transactions" in the Company's 2002 Proxy Statement, and "Indemnification
      of Directors and Officers" in Part II of the Registration Statement,
      insofar as the statements constitute a summary of documents referred to
      therein or matters of law, are accurate summaries and fairly and correctly
      present, in all material respects, the information required to be
      disclosed in a registration statement on Form S-3 under the Act and the
      Rules and Regulations (provided, however, that such counsel may rely on
      representations of the Company with respect to the factual matters
      contained in such statements, and provided further that such counsel shall
      state that nothing has come to the attention of such counsel that leads
      them to believe that such representations are not true and correct in all
      material respects).

            (xii) The Company is not an "investment company" or an "affiliated
      person" of, or "promoter" or "principal underwriter" for, an "investment
      company," as such terms are defined in the Investment Company Act of 1940,
      as amended.

            (xiii) Based solely on verbal confirmation with the NASD, the Shares
      have been duly authorized for listing on the NNM, subject to notice of
      issuance.

            (xiv) The Registration Statement has become effective under the Act,
      and based solely on verbal confirmation with the Commission, to such
      counsel's knowledge no stop order suspending the effectiveness of the
      Registration Statement has been issued and no proceeding for that purpose
      has been instituted or is pending or threatened.

            (xv) The Registration Statement, the Prospectus and the Prospectus
      as amended or supplemented comply as to form in all material respects with
      the requirements of the Act and the Rules and Regulations (other than the
      financial statements and notes thereto, financial statement schedules and
      other financial and statistical data contained or incorporated by
      reference in the Registration Statement, the Prospectus or the Prospectus
      as amended or supplemented, as to which such counsel need express no
      opinion). To such counsel's knowledge there is no amendment to the
      Registration Statement required to be filed which has not been filed.

      In addition, such counsel shall state that it participated in conferences
with representatives of the Company and with representatives of its independent
accountants and counsel, at which the contents of the Registration Statement and
the Prospectus and any amendment and supplement thereto and related matters were
discussed and nothing has come to such counsel's attention to cause it to
believe that (A) as of the Effective Date, the Registration Statement (other
than the financial statements and notes thereto, financial statement schedules
and other financial and statistical data contained or incorporated by reference
therein, as to which such counsel need express no opinion) contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
(B) the Prospectus, or any amendment or supplement thereto, as of its date and
the Closing Date and, if later, the Option Closing Date (in the case of such
confirmation delivered on the Option Closing Date), contained or contains any
untrue statement of a material fact or omitted or omits to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading (other than the financial statements
and notes thereto, financial statement schedules and other financial and
statistical data contained or incorporated by reference therein, as to which
such counsel need express no opinion).

      (g) The Representatives shall have received an opinion, dated the Closing
Date and, with respect to the Option Shares, the Option Closing Date,
satisfactory in form and substance to the Representatives and counsel for


                                      -13-

the Underwriters from counsel to the Company acceptable to Xxxxxxx & Company,
Inc., with respect to the following matters:

            (i) Transmeta World, Inc. (the "Cayman Islands Subsidiary") has been
      duly incorporated as an exempted company with limited liability, is
      validly existing and in good standing under the laws of the Cayman Islands
      and has full power and authority to own its own property and assets, to
      lease property or assets and to carry on its business in accordance with
      its Memorandum and Articles of Association.

            (ii) The authorized share capital of the Cayman Islands Subsidiary
      as of the date of such opinion is as set forth in such opinion; as at such
      counsel's inspection of the Register of Members of the Cayman Islands
      Subsidiary at the time and date set forth in such opinion, Transmeta
      International Corporation was listed as the registered holder of the
      number of ordinary shares in the share capital of the Cayman Islands
      Subsidiary set forth in such opinion, which shares are recorded in the
      Register of Members as fully paid and no other party was listed as a
      registered holder of shares in the Cayman Islands Subsidiary.

            (iii) Based solely on such counsel's inspection of the Register of
      Writs and Other Originating process in the Grand Court of the Cayman
      Islands from the date of incorporation of the Cayman Islands Subsidiary to
      the date set forth in such opinion, there were no actions or petitions
      pending against the Cayman Islands Subsidiary in the Grand Court of the
      Cayman Islands as at close of business in the Cayman Islands on the date
      set forth in such opinion.

      (h) The Representatives shall have received an opinion, dated the Closing
Date and, with respect to the Option Shares, the Option Closing Date,
satisfactory in form and substance to the Representatives and counsel for the
Underwriters from counsel to the Company acceptable to Xxxxxxx & Company, Inc.,
with respect to the following matters

            (i) The statements relating to documents or matters of law included
      under the captions "Risk Factors -- Our products may infringe the
      intellectual property rights of others, which may cause us to become
      subject to expensive litigation, cause us to incur substantial damages,
      require us to pay significant license fees or prevent us from selling our
      products", "Risk Factors -- If we are unable to protect our proprietary
      rights adequately, our competitors might gain access to our technology and
      we might not compete successfully in our markets" and "Business --
      Intellectual Property" in the Prospectus and Prospectus as amended or
      supplemented, insofar as the statements constitute a summary of documents
      referred to therein or matters of law, are accurate summaries and fairly
      and correctly present, in all material respects, the information required
      to be disclosed in a registration statement on Form S-3 under the Act and
      the Rules and Regulations (provided, however, that such counsel may rely
      on representations of the Company with respect to the factual matters
      contained in such statements, and provided further that such counsel shall
      state that nothing has come to the attention of such counsel that leads
      them to believe that such representations are not true and correct in all
      material respects).

            (ii) The Company or its predecessor corporation, Transmeta
      Corporation, a California corporation, is listed in the records of the
      U.S. Patent and Trademark Office as the holder of record of each of the
      patents listed on Schedule 1 of such opinion and each of the applications
      listed by application number on Schedule 2 of such opinion. To such
      counsel's knowledge, there is no pending or overtly threatened claim of
      any third party to any ownership interests in any of the patents listed on
      Schedule 1 or the patent applications listed on Schedule 2.

      (i) The Representatives shall have received an opinion, dated the Closing
Date and the Option Closing Date, from the General Counsel of the Company with
respect to the following matters: to such counsel's knowledge, the Company does
not own or control, directly or indirectly, any shares of stock or any other
equity or long term debt securities of any corporation or have any equity
interests in any corporation, firm, partnership, joint venture, association or
other entity other than its Subsidiaries.

In addition, such counsel shall state that such counsel has participated in the
preparation of the Registration Statement, the Prospectus, the Prospectus as
amended or supplemented and the documents incorporated by reference


                                      -14-

in the Prospectus and the Prospectus as amended or supplemented, and has no
reason to believe that, (A) as of the Effective Date, the Registration
Statement, or any amendment or supplement thereto, (other than the financial
statements, schedules and other financial data contained or incorporated by
reference therein, as to which such counsel need express no opinion) contained
any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, (B) the Prospectus, or any amendment or supplement thereto, as of
its date and the Closing Date and, if later, the Option Closing Date, contained
or contains any untrue statement of a material fact or omitted or omits to state
a material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (other than the
financial statements, schedules and other financial data contained or
incorporated by reference therein, as to which such counsel need express no
opinion) or (C) any of the documents incorporated by reference in the Prospectus
and the Prospectus as amended or supplemented, when such documents became
effective or were filed as the case may be, contained, in the case of a
registration statement which became effective under the Act, an untrue statement
of a material fact required to be stated therein or necessary to make the
statements therein not misleading, or, in the case of documents which were filed
under the Exchange Act with the Commission, an untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made
when such documents were so filed, not misleading.

      (j) The Representatives shall have received an opinion, dated the Closing
Date and the Option Closing Date, from Xxxxxxxx & Xxxxxxxx LLP, counsel to the
Underwriters, with respect to such matters as the Representatives may reasonably
request, which opinion shall be satisfactory in all respects to the
Representatives.

      (k) Concurrently with the execution and delivery of this Agreement, the
Accountants shall have furnished to the Representatives a letter, dated the date
of its delivery, addressed to the Representatives and in form and substance
satisfactory to the Representatives, confirming that they are independent
accountants with respect to the Company and its Subsidiaries as required by the
Act, the Exchange Act, the Rules and Regulations and the Exchange Act Rules and
Regulations, containing the information of the type customarily included in an
accountant's "comfort letter" and with respect to certain financial and other
statistical and numerical information contained or incorporated by reference in
the Registration Statement. At the Closing Date and, as to the Option Shares,
the Option Closing Date, the Accountants shall have furnished to the
Representatives a letter, dated the date of its delivery, which shall confirm,
on the basis of a review in accordance with the procedures set forth in the
letter from the Accountants, that nothing has come to their attention during the
period from the date of the letter referred to in the prior sentence to a date
(specified in the letter) not more than three days prior to the Closing Date or
the Option Closing Date, as the case may be, which would require any change in
their letter dated the date hereof if it were required to be dated and delivered
at such Closing Date or Option Closing Date.

      (l) At the Closing Date and, as to the Option Shares, the Option Closing
Date, there shall be furnished to the Representatives a certificate, dated the
date of its delivery, signed on behalf of the Company by each of the Chief
Executive Officer and the Chief Financial Officer of the Company, in form and
substance satisfactory to the Representatives, to the effect that:

            (i) Each signer of such certificate has carefully examined the
      Registration Statement, the Prospectus and the Prospectus as amended or
      supplemented (including any documents filed under the Exchange Act and
      deemed to be incorporated by reference into the Prospectus and the
      Prospectus as amended or supplemented) and (A) as of the date of such
      certificate, such documents are true and correct in all material respects
      and do not omit to state a material fact required to be stated therein or
      necessary in order to make the statements therein not untrue or misleading
      and (B) in the case of the certificate delivered at the Closing Date and
      the Option Closing Date, since the Effective Date no event has occurred as
      a result of which it is necessary to amend or supplement the Prospectus or
      the Prospectus as amended or supplemented in order to make the statements
      therein not untrue or misleading.

            (ii) Each of the representations and warranties of the Company
      contained in this Agreement were, when originally made, and are, at the
      time such certificate is delivered, true and correct.

            (iii) Each of the covenants required to be performed by the Company
      herein on or prior to the date of such certificate has been duly, timely
      and fully performed and each condition herein required to be


                                      -15-

      satisfied or fulfilled on or prior to the date of such certificate has
      been duly, timely and fully satisfied or fulfilled.

      (m) On or prior to the Closing Date, the Representatives shall have
received the executed agreements referred to in Section 4(o).

      (n) The Shares shall be qualified for sale in such jurisdictions as the
Representatives may reasonably request (provided, however, that the Company
shall not be required to consent to service of process) and each such
qualification shall be in effect and not subject to any stop order or other
proceeding on the Closing Date or the Option Closing Date.

      (o) Prior to the Closing Date, the Shares shall have been duly authorized
for listing on the NNM upon official notice of issuance.

      (p) The Company shall have furnished to the Representatives such
certificates, in addition to those specifically mentioned herein, as the
Representatives may have reasonably requested as to the accuracy and
completeness at the Closing Date and the Option Closing Date of any statement in
the Registration Statement, the Prospectus or the Prospectus, as amended or
supplemented, as to the accuracy at the Closing Date and the Option Closing Date
of the representations and warranties of the Company herein, as to the
performance by the Company of its obligations hereunder, or as to the
fulfillment of the conditions concurrent and precedent to the obligations
hereunder of the Representatives.

      6. Indemnification.

      (a) The Company will indemnify and hold harmless each Underwriter, the
directors, officers, employees and agents of each Underwriter and each person,
if any, who controls each Underwriter within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, from and against any and all losses,
claims, liabilities, expenses and damages (including any and all investigative,
legal and other expenses reasonably incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claim asserted), to
which they, or any of them, may become subject under the Act, the Exchange Act
or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, liabilities, expenses or damages
arise out of or are based on any untrue statement or alleged untrue statement of
a material fact contained in any preliminary prospectus, the Registration
Statement or the Prospectus or any amendment or supplement to the Registration
Statement or the Prospectus, or the omission or alleged omission to state in
such document a material fact required to be stated in it or necessary to make
the statements in it not misleading in the light of the circumstances in which
they were made, or arise out of or are based in whole or in part on any
inaccuracy in the representations and warranties of the Company contained herein
or any failure of the Company to perform its obligations hereunder or under law
in connection with the transactions contemplated hereby; provided, however, that
(i) the Company will not be liable to the extent that such loss, claim,
liability, expense or damage arises from the sale of the Shares in the public
offering to any person by an Underwriter and is based on an untrue statement or
omission or alleged untrue statement or omission made in reliance on and in
conformity with information relating to any Underwriter furnished in writing to
the Company by the Representatives, on behalf of any Underwriter, expressly for
inclusion in the Registration Statement, the preliminary prospectus, the
Prospectus or the Prospectus as amended or supplemented and (ii) the Company
will not be liable to any Underwriter, the directors, officers, employees or
agents of such Underwriter or any person controlling such Underwriter with
respect to any loss, claim, liability, expense, or damage arising out of or
based on any untrue statement or omission or alleged untrue statement or
omission or alleged omission to state a material fact in any preliminary
prospectus or the Prospectus, that is corrected in the Prospectus as amended or
supplemented in the form in which it is first filed with the Commission pursuant
to Rule 424(b) after the date hereof and pursuant to Section 4(b) hereof, if the
person asserting any such loss, claim, liability, charge or damage purchased
Shares from such Underwriter but was not sent or given a copy of such amended or
supplemented Prospectus at or prior to the written confirmation of the sale of
such Shares to such person and if copies of such amended or supplemented
Prospectus were timely delivered to such Underwriter pursuant to Section 5
hereof. The Company acknowledges that the second, ninth, tenth, eleventh,
twelfth, thirteenth and fourteenth paragraphs set forth under the heading
"Underwriting" in the Prospectus constitute the only information relating to any
Underwriter furnished in writing to the Company by the Representatives on behalf
of the


                                      -16-

Underwriters expressly for inclusion in the Registration Statement, the
preliminary prospectus, the Prospectus or the Prospectus as amended or
supplemented. This indemnity agreement will be in addition to any liability that
the Company might otherwise have.

      (b) Each Underwriter will indemnify and hold harmless the Company, each
director of the Company, each officer of the Company who signs the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent
as the foregoing indemnity from the Company to each Underwriter, as set forth in
Section 6(a), but only insofar as losses, claims, liabilities, expenses or
damages arise out of or are based on any untrue statement or omission or alleged
untrue statement or omission made in reliance on and in conformity with
information relating to any Underwriter furnished in writing to the Company by
the Representatives, on behalf of such Underwriter, expressly for use in the
Registration Statement, the preliminary prospectus, the Prospectus or the
Prospectus as amended or supplemented. The Company acknowledges that the second,
ninth, tenth, eleventh, twelfth, thirteenth and fourteenth paragraphs set forth
under the heading "Underwriting" in the Prospectus constitute the only
information relating to any Underwriter furnished in writing to the Company by
the Representatives on behalf of the Underwriters expressly for inclusion in the
Registration Statement, the preliminary prospectus, the Prospectus or the
Prospectus as amended or supplemented. This indemnity will be in addition to any
liability that each Underwriter might otherwise have.

      (c) Any party that proposes to assert the right to be indemnified under
this Section 6 shall, promptly after receipt of notice of commencement of any
action against such party in respect of which a claim is to be made against an
indemnifying party or parties under this Section 6, notify each such
indemnifying party in writing of the commencement of such action, enclosing with
such notice a copy of all papers served, but the omission so to notify such
indemnifying party will not relieve it from any liability that it may have to
any indemnified party under the foregoing provisions of this Section 6 unless,
and only to the extent that, such omission results in the loss of substantive
rights or defenses by the indemnifying party. If any such action is brought
against any indemnified party and it notifies the indemnifying party of its
commencement, the indemnifying party will be entitled to participate in and, to
the extent that it elects by delivering written notice to the indemnified party
promptly after receiving notice of the commencement of the action from the
indemnified party, jointly with any other indemnifying party similarly notified,
to assume the defense of the action, with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense, the indemnifying party will not be
liable to the indemnified party for any legal or other expenses except as
provided below and except for the reasonable costs of investigation incurred by
the indemnified party in connection with the defense. The indemnified party will
have the right to employ its own counsel in any such action, but the fees,
expenses and other charges of such counsel will be at the expense of such
indemnified party unless (i) the employment of counsel by the indemnified party
has been authorized in writing by the indemnifying party, (ii) the indemnified
party has reasonably concluded (based on advice of counsel) that there may be
legal defenses available to it or other indemnified parties that are different
from or in addition to those available to the indemnifying party, (iii) a
conflict or potential conflict exists (based on advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (iv) the indemnifying
party has not in fact employed counsel reasonably satisfactory to the
indemnified party to assume the defense of such action within a reasonable time
after receiving notice of the commencement of the action, in each of which cases
the reasonable fees, disbursements and other charges of counsel will be at the
expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees,
disbursements and other charges of more than one separate firm admitted to
practice in such jurisdiction at any one time for all such indemnified party or
parties. All such fees, disbursements and other charges will be reimbursed by
the indemnifying party promptly as they are incurred. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement (i) includes
an unconditional release of such indemnified party from all liability on any
claims that are the subject matter of such action and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act by
or on behalf of an indemnified party. An indemnifying party will not be liable
for any settlement of any action or claim effected without its written consent
(which consent will not be unreasonably withheld or delayed).


                                      -17-

      (d) If the indemnification provided for in this Section 6 is applicable in
accordance with its terms but for any reason is held to be unavailable to or
insufficient to hold harmless an indemnified party under paragraphs (a), (b) and
(c) of this Section 6 in respect of any losses, claims, liabilities, expenses
and damages referred to therein, then each applicable indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable (including any investigative, legal and other expenses reasonably
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted, but after deducting any contribution
received by the Company from persons other than the Underwriters, such as
persons who control the Company within the meaning of the Act, officers of the
Company who signed the Registration Statement and directors of the Company, who
also may be liable for contribution) by such indemnified party as a result of
such losses, claims, liabilities, expenses and damages in such proportion as
shall be appropriate to reflect the relative benefits received by the Company,
on the one hand, and the Underwriters, on the other hand. The relative benefits
received by the Company, on the one hand, and the Underwriters, on the other
hand, shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions received by the Underwriters,
in each case as set forth in the table on the cover page of the Prospectus, as
amended or supplemented. If, but only if, the allocation provided by the
foregoing sentence is not permitted by applicable law, the allocation of
contribution shall be made in such proportion as is appropriate to reflect not
only the relative benefits referred to in the foregoing sentence but also the
relative fault of the Company, on the one hand, and the Underwriters, on the
other hand, with respect to the statements or omissions that resulted in such
loss, claim, liability, expense or damage, or action in respect thereof, as well
as any other relevant equitable considerations with respect to such offering.
Such relative fault shall be determined by reference to whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company or the
Representatives on behalf of the Underwriters, the intent of the parties and
their relative knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contributions pursuant to this Section
6(d) were to be determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
that does not take into account the equitable considerations referred to herein.
The amount paid or payable by an indemnified party as a result of the loss,
claim, liability, expense or damage, or action in respect thereof, referred to
above in this Section 6(d) shall be deemed to include, for purposes of this
Section 6(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 6(d), no Underwriter
shall be required to contribute any amount in excess of the underwriting
discounts received by it and no person found guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) will be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Section 6(d) are several in proportion to their respective underwriting
obligations and not joint. For purposes of this Section 6(d), any person who
controls a party to this Agreement within the meaning of the Act will have the
same rights to contribution as that party, and each officer of the Company who
signed the Registration Statement will have the same rights to contribution as
the Company, subject in each case to the provisions hereof. Any party entitled
to contribution, promptly after receipt of notice of commencement of any action
against any such party in respect of which a claim for contribution may be made
under this Section 6(d), will notify any such party or parties from whom
contribution may be sought, but the omission so to notify will not relieve the
party or parties from whom contribution may be sought from any other obligation
it or they may have under this Section 6(d). No party will be liable for
contribution with respect to any action or claim settled without its written
consent (which consent will not be unreasonably withheld).

      (e) The indemnity and contribution agreements contained in this Section 6
and the representations and warranties of the Company contained in this
Agreement shall remain operative and in full force and effect regardless of (i)
any investigation made by or on behalf of the Underwriters, (ii) acceptance of
any of the Shares and payment therefor or (iii) any termination of this
Agreement.

      7. Reimbursement of Certain Expenses. In addition to its other obligations
under Section 6(a) of this Agreement, the Company hereby agrees to reimburse the
Underwriters on a quarterly basis for all reasonable legal and other expenses
incurred in connection with investigating or defending any claim, action,
investigation, inquiry or other proceeding arising out of or based upon, in
whole or in part, any statement or omission or alleged statement or omission, or
any inaccuracy in the representations and warranties of the Company contained
herein or failure of


                                      -18-

the Company to perform its respective obligations hereunder or under law, all as
described in Section 6(a), notwithstanding the absence of a judicial
determination as to the propriety and enforceability of the obligations under
this Section 7 and the possibility that such payment might later be held to be
improper; provided, however, that, to the extent any such payment is ultimately
held to be improper, the persons receiving such payments shall promptly refund
them.

      8. Termination. The obligations of the several Underwriters under this
Agreement may be terminated at any time on or prior to the Closing Date (or,
with respect to the Option Shares, on or prior to the Option Closing Date), by
notice to the Company from the Representatives, without liability on the part of
any Underwriter to the Company if, prior to delivery and payment for the Firm
Shares or Option Shares, as the case may be, in the sole judgment of the
Representatives, (i) trading in any of the equity securities of the Company
shall have been suspended or limited by the Commission or by The Nasdaq Stock
Market, (ii) trading in securities generally on the New York Stock Exchange or
The Nasdaq Stock Market shall have been suspended or limited or minimum or
maximum prices shall have been generally established on such exchange, or
additional material governmental restrictions, not in force on the date of this
Agreement, shall have been imposed upon trading in securities generally by such
exchange, by order of the Commission or any court or other governmental
authority, or by The Nasdaq Stock Market, (iii) a general banking moratorium
shall have been declared by federal, New York State or California State
authorities or any material disruption of the securities settlement or clearance
services in the United States shall have occurred, or (iv) any material adverse
change in the financial or securities markets in the United States or in
political, financial or economic conditions in the United States, any outbreak
or material escalation of hostilities involving the United States, a declaration
of a national emergency or war by the United States, or other major calamity or
crisis, either within or outside the United States, shall have occurred, the
effect of which is such as to make it, in the sole judgment of the
Representatives, impracticable or inadvisable to proceed with completion of the
public offering or the delivery of and payment for the Shares.

      If this Agreement is terminated pursuant to Section 8 or Section 9 hereof,
the Company shall not be under any liability to any Underwriter except as
provided in Sections 4(j), 6 and 7 hereof; but, if for any other reason the
purchase of the Shares by the Underwriters is not consummated or if for any
reason the Company shall be unable to perform its obligations hereunder, the
Company will reimburse the Underwriters for all out-of-pocket expenses
(including the reasonable fees, disbursements and other charges of counsel to
the Underwriters) incurred by the Underwriters in connection with the offering
of the Shares.

      9. Substitution of Underwriters. If any one or more of the Underwriters
shall fail or refuse to purchase any of the Firm Shares that it or they have
agreed to purchase hereunder, and the aggregate number of Firm Shares that such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate number of Firm Shares, the other
Underwriters shall be obligated, severally, to purchase the Firm Shares that
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase, in the proportions which the number of Firm Shares that they have
respectively agreed to purchase pursuant to Section 1 bears to the aggregate
number of Firm Shares which all such non-defaulting Underwriters have so agreed
to purchase, or in such other proportions as the Representatives may specify;
provided that in no event shall the maximum number of Firm Shares that any
Underwriter has become obligated to purchase pursuant to Section 1 be increased
pursuant to this Section 9 by more than one-ninth of such number of Firm Shares
without the prior written consent of such Underwriter. In any such case either
the Representatives or the Company shall have the right to postpone the Closing
Date, but in no event for longer than seven days, in order that the required
changes, if any, in the Registration Statement and the Prospectus or in any
other documents or arrangements may be effected. If any Underwriter or
Underwriters shall fail or refuse to purchase any Firm Shares that it or they
agreed to purchase hereunder and the aggregate number of Firm Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
exceeds one-tenth of the aggregate number of the Firm Shares and arrangements
satisfactory to the Representatives and the Company for the purchase of such
Firm Shares are not made within 48 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Underwriter and
the Company for the purchase or sale of any Shares under this Agreement. Any
action taken pursuant to this Section 9 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.


                                      -19-

      10. Miscellaneous. Notice given pursuant to any of the provisions of this
Agreement shall be in writing and, unless otherwise specified, shall be mailed
or delivered (a) if to the Company, at the office of the Company, 0000 Xxxxxxx
Xxxxxx, Xxxxx Xxxxx, Xxxxxxxxxx, 00000, Attention: General Counsel, with a copy
to Xxxx Xxxxx, Esq., Fenwick & West LLP, 000 Xxxxxxxxxx Xxxxxx, Xxxxxxxx Xxxx,
Xxxxxxxxxx, 00000, or (b) if to the Underwriters, to the Representatives at the
offices of Xxxxxxx & Company, Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Corporate Finance Department, with a copy to Xxxxxxx X. Xxxxxxxx,
Xx., Esq., Xxxxxxxx & Xxxxxxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000.
Any such notice shall be effective only upon receipt. Any notice under such
Section 8 or 9 may be made by telecopier or telephone, but if so made shall be
subsequently confirmed in writing.

      This Agreement has been and is made solely for the benefit of the several
Underwriters, the Company, and the controlling persons, directors and officers
referred to in Section 6, and their respective successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement. The term "successors and assigns" as used in this Agreement shall not
include a purchaser, as such purchaser, of Shares from any of the several
Underwriters.

      Any action required or permitted to be made by the Representatives under
this Agreement may be taken by them jointly or by Xxxxxxx & Company, Inc.

      This Agreement shall be governed by and construed in accordance with the
laws of the State of New York applicable to contracts made and to be performed
entirely within such State.

      This Agreement may be signed in two or more counterparts with the same
effect as if the signatures thereto and hereto were upon the same instrument.

      In case any provision in this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

      THE COMPANY AND THE UNDERWRITERS EACH HEREBY WAIVE ANY RIGHT THEY MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED UPON OR ARISING OUT OF THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

      Please confirm that the foregoing correctly sets forth the agreement among
the Company and the several Underwriters.

                                    Very truly yours,



                                    TRANSMETA CORPORATION



                                    By:    /s/ Xxxx X'Xxxx Xxxxxxx
                                          ------------------------------
                                          Title:  VP, General Counsel &
                                                  Secretary

Confirmed as of the date first
above mentioned:
XXXXXXX & COMPANY, INC.
X.X. XXXXXXX & SONS, INC.
U.S. BANCORP XXXXX XXXXXXX INC.

     Acting on behalf of themselves
     and as the Representatives of
     the other several Underwriters
     named in Schedule I hereto.




By:   XXXXXXX & COMPANY, INC.


By:   /s/ Xxxxxx X. Xxxxxx
     ------------------------
     Title:  Principal

                                      -21-