Intel and Advanced Micro Devices Thursday announced that they have settled all antitrust litigation and patent cross-license disputes between the companies.
Under terms of the deal, Intel will pay AMD US$1.25 billion, and has agreed to a set of business practice provisions, according to a statement from the companies.
AMD and Intel also said they have agreed to a new five-year cross-license agreement, and have given up claims of breach of contract from the previous license agreement.
"While the relationship between the two companies has been difficult in the past, this agreement ends the legal disputes and enables the companies to focus all of our efforts on product innovation and development," the companies said in a statement.
On its part, AMD has agreed to drop all regulatory complaints worldwide and all pending legal disputes, including a case in US District Court in Delaware and two cases in Japan. The agreement will be made public in filings with the Securities and Exchange Commission, the companies said.
Intel still has legal battles to fight, however. On 4 November, New York Attorney General Andrew Cuomo filed a federal antitrust lawsuit against Intel, charging that the chip giant conducted a "systematic campaign" of illegal conduct to protect a monopoly.
Cuomo's lawsuit, says Intel forced computer makers into agreements to favor Intel chips and threatened to punish those thought to be working too closely with Intel competitors like AMD.
Cuomo's lawsuit came about two weeks after news reports that the US Federal Trade Commission is considering filing a formal complaint against Intel. The New York attorney general's lawsuit mirrored AMD's suit, according to Intel.
The European Commission fined Intel €1.06 billion (equivalent to US$1.44 billion at the time) in May, after finding it guilty of antitrust violations.
In 2008, the Korea Fair Trade Commission fined Intel about $25 million for abusing its dominant position in the PC processor market.