Opti Inc – ‘PREC14A’ on 12/14/01 re: Opti Inc

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Preliminary Proxy Solicitation Material — Contested Solicitation   —   Schedule 14A
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Document/Exhibit                   Description                      Pages   Size 

 1: PREC14A     Contested Preliminary Notice & Proxy                  77    342K 

Document Table of Contents

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SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities 
Exchange Act of 1934 (Amendment No.  )  

Filed by the Registrant [X]                                                     

Filed by a Party other than the Registrant [_]                                  

Check the appropriate box:                                                      

[X]  Preliminary Proxy Statement           [_]  Confidential, for Use of the    
                                                Commission Only (as Permitted by
[_]  Definitive Proxy Statement                 Rule 14a-6(e)(2))               

[_]  Definitive Additional Materials                                            

[_]  Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12          

OPTi Inc. 
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)  

--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)  

Payment of Filing Fee (Check the appropriate box):                              

[X]  No fee required.                                                           

[_]  Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.   

(1) Title of each class of securities to which transaction applies:   

   -------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:      

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(3) Per unit price or other underlying value of transaction computed  
   pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):

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(4) Proposed maximum aggregate value of transaction:                  

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(5) Total fee paid:                                                   

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[_]  Fee paid previously with preliminary materials.                            

[_]  Check box if any part of the fee is offset as provided by Exchange         
  Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
     was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.           

(1) Amount Previously Paid:                                           

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(2) Form, Schedule or Registration Statement No.:                     

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(3) Filing Party:                                                     

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(4) Date Filed:                                                       

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Notes:                                                                          

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OPTi Inc. 
880 Maude Avenue, Suite A 
Mountain View, California 94043 

                                                              December  , 2001

Dear Shareholders:                                                              

You are cordially invited to attend the Annual Meeting of Shareholders of 
OPTi Inc. ("OPTi") which will be held on January 11, 2002, at 9:00 am., Pacific 
Time, at the offices of Heller Ehrman White & McAuliffe LLP, at 275 Middlefield 
Road, Menlo Park, California 94025.                                             

  At the Annual Meeting, you will be asked to vote on the following proposals:

    1. Approve and adopt the Plan of Complete Liquidation and Dissolution of
OPTi. On September 7, 2001, OPTi's Board of Directors determined that the 
 voluntary liquidation and dissolution of OPTi would be in the best interest
of its shareholders and approved a voluntary Plan of Complete Liquidation 
and Dissolution (the "Liquidation Plan"). You will be asked at the meeting
to approve the voluntary liquidation and dissolution of OPTi, and to adopt
the Liquidation Plan.                                                     

    2. Approve the appointment of Trustees. You will be asked at the meeting
 to approve the appointment of Stephen A. Dukker, Kapil K. Nanda and William
H. Welling as trustees of a trust that will be established for the benefit
of the shareholders primarily to conduct the orderly liquidation of OPTi's
patents and other intellectual property.                                  

 3. Elect Four members to the Board of Directors. These directors will
serve until the earliest of (i) the dissolution of OPTi; (ii) OPTi's next 
annual meeting; or (iii) the appointment of their successors.             

  4. Appointment of Ernst & Young LLP as independent accountants of OPTi
for the fiscal year ending December 31, 2001.                             

You may also be asked to vote on any other business as may properly come  
before the meeting or any postponement or adjournment thereof.                  

The foregoing items of business are more fully described in the enclosed  
Proxy Statement. The formal Notice of Meeting, the WHITE proxy card and a copy  
of the Annual Report to Shareholders describing OPTi's operations for the year  
ended December 31, 2000 are also enclosed. Whether or not you plan to attend    
the meeting, it is important that you sign and return the enclosed WHITE proxy  
card promptly. A prepaid return envelope is provided for this purpose. Your     
shares will be voted at the meeting in accordance with your proxy.              

                     Very truly yours,

             OPTi Inc.

                                          --------------------------------------
                   Michael Mazzoni
             Secretary

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OPTi Inc. 

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

Notice of Annual Meeting of Shareholders  
To Be Held On January 11, 2002  

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

TO THE SHAREHOLDERS:                                                            

 NOTICE IS HEREBY GIVEN that the 2001 Annual Meeting of Shareholders of OPTi
Inc., a California corporation ("OPTi" or the "Company"), will be held on       
January 11, 2002 at 9:00 a.m., Pacific Time, at the offices of Heller Ehrman    
White & McAuliffe LLP, at 275 Middlefield Road, Menlo Park, California 94025    
for the following purposes:                                                     

  1. To approve and adopt the voluntary Plan of Complete Liquidation and
Dissolution attached as Annex A to the Proxy Statement, including the     
establishment of the OPTi Inc. Liquidating Trust (Proposal No. 1);        

2. To approve of the appointment of three Trustees of the OPTi Inc. 
Liquidating Trust (Proposal No. 2);                                       

   3. To elect four directors who will serve until the earliest of (i) the
dissolution of OPTi; (ii) OPTi's next annual meeting; or (iii) the        
appointment of their successors (Proposal No. 3);                         

4. To ratify the appointment of Ernst & Young LLP as independent    
accountants of the Company for the fiscal year ending December 31, 2001   
(Proposal No. 4); and                                                     

5. To transact such other business as may properly come before the  
meeting or any postponement or adjournment thereof.                       

The foregoing items of business are more fully described in the Proxy     
Statement accompanying this Notice.                                             

  Only shareholders of record at the close of business on December 7, 2001 are
entitled to notice of and to vote at the meeting and any postponement or        
adjournment thereof.                                                            

              Sincerely,

                   Michael Mazzoni
             Secretary

Mountain View, California                                                       
December  , 2001                                                                

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

IMPORTANT: All shareholders are cordially invited to attend the Annual      
 Meeting in person. However, to ensure your representation at the meeting, you
are urged to mark, sign, date and return the enclosed WHITE proxy card as   
promptly as possible in the postage-prepaid envelope enclosed for that      
purpose. Any shareholder attending the meeting may vote in person even if   
such shareholder returned a WHITE proxy card.                               

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

--------------------------------------------------------------------------------
IMPORTANT: Your Board of Directors also urges you not to sign any proxy card
sent to you by or on behalf of Breider, Moore & Co. Even if you have        
previously signed a proxy card sent to you by or on behalf of Breider, Moore
& Co., you can revoke that earlier proxy by signing, dating and mailing the 
enclosed WHITE proxy card in the envelope provided.                         
--------------------------------------------------------------------------------

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SUMMARY TERM SHEET  

  The voluntary Plan of Complete Liquidation and Dissolution attached as Annex
A to this proxy statement contemplates the following agreements and steps:      

 Liquidating our assets. We will transfer OPTi's patents, other intellectual
property, certain assets and unpaid liabilities, of OPTi, if any, into a  
 liquidating trust. We will collect, sell, exchange, distribute or otherwise
dispose of all of the remaining property of OPTi (for a more detailed     
description see page    );                                                

  Paying (or providing for) our claims, obligations, liabilities and expenses,
including establishing a reserve (the "Contingency Reserve") to fund      
liabilities in an amount to be determined as information concerning       
contingent liabilities becomes available (for a more detailed description 
see page    );                                                            

Distributing the Company's assets and the net proceeds of the liquidation 
 pro rata to our shareholders following receipt of such proceeds, except the
assets that are transferred by OPTi for the shareholders' benefit to the  
  Liquidating Trust or retained by OPTi as a Contingency Reserve for paying or
making reasonable provisions for the claims and obligations of the Company
(for a more detailed description see page    ); and                       

 Winding up our operations and dissolving the Company in accordance with the
Plan of Complete Liquidation and Dissolution (for a more detailed         
description see page    ).                                                

  In considering the recommendations of our Board of Directors with respect to
the Plan of Complete Liquidation and Dissolution, and in implementing the plan, 
you should be aware that some of our directors and officers may have had or may 
have interests that are different from your interests as a shareholder. Our     
Board of Directors was aware of these matters in its consideration of the Plan  
of Complete Liquidation and Dissolution (for a more detailed description see    
page    ).                                                                      

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QUESTIONS AND ANSWERS ABOUT THE PROPOSALS 

The following questions and answers are for your convenience only, and    
briefly address some commonly asked questions about the proposals. You should   
still carefully read this proxy statement in its entirety, including the        
attached annexes.                                                               

Q: WHAT WILL BE VOTED ON AT THE ANNUAL MEETING?                                 

A: At the meeting you will be asked to vote on the following items:             

Proposal 1:  Approval of a voluntary Plan of Complete Liquidation and     
              Dissolution attached as Annex A (the "Liquidation Plan" or the
"Plan").                                        

 Proposal 2: Approval  of the appointment of three Trustees of the OPTi Inc.
Liquidating Trust.            

 Proposal 3:  Election of the four directors standing for re-election to our
Board of Directors (the "Board).                

 Proposal 4:  Ratification of the appointment of Ernst & Young LLP as OPTi's
              independent accountants for the year ending December 31, 2001.

Proposal 5: Transactionof such other business as may properly come before 
                  the meeting or any adjournment or postponement
thereof.                    

Q: WHAT DOES THE LIQUIDATION PLAN ENTAIL?                                       

A: The Liquidation Plan provides for the voluntary liquidation, winding up and  
 dissolution of OPTi. If the Liquidation Plan is approved, we will liquidate
our remaining assets, satisfy or make reasonable provisions for our       
remaining obligations and make distributions to our shareholders of       
available liquidation proceeds. By the terms of the Liquidation Plan,     
shareholder approval of the Plan will also constitute shareholder approval
 of the establishment of a liquidating trust (the "Liquidating Trust" or the
"Trust") pursuant to a Liquidating Trust Agreement (the "Liquidating Trust
Agreement") by and among OPTi Inc., Stephen A. Dukker, Kapil K. Nanda and 
William H. Welling as trustees of the Liquidating Trust (the "Trustees")  
attached as Annex B. Separately, the shareholders will be asked to approve
of the appointment of the three named Trustees.                           

Q. WHY DID WE DECIDE NOT TO CONTINUE BUSINESS AS USUAL UNDER OUR ESTABLISHED    
BUSINESS PLAN?                                                            

A. Since our incorporation in 1989, OPTi has conducted business as an           
independent supplier of semiconductor products that provide core logic    
functions or universal serial bus controller functions for a personal     
computer or embedded product within a semiconductor device. From inception
  through 1995, our principal business was our core logic products for desktop
 personal computers and we employed as many as 235 employees over the years.
However, in time, we faced increasingly tight competition from companies  
 with substantially greater financial, technical, distribution and marketing
  resources. During February 1999, we completely ceased further development of
core logic products, even though we continued to ship such products to    
customers. We have also been unable to introduce new products that can    
  compete successfully in our changing markets as many of the functions of our
semiconductor products have been integrated into chip sets manufactured by
our larger competitors. From 1995 through 2000, our annual net sales      
declined from $163.7 million to $23.2 million in 2000, of which less than 
$10 million was from sales of our semiconductor chip sets.                

In light of these increasingly difficult competitive conditions, our Board
  determined that it was extremely unlikely that OPTi would be able to compete
successfully selling products in our existing markets. Consequently, the  
  Board examined a number of strategic alternatives, which included developing
 or acquiring new technologies related to our ongoing business, shifting our
focus to pursuing licenses as a means of settling potential patent        
infringement claims against companies which may be using our patented     
technology without our permission and adopting the liquidation plan       
described herein.                                                         

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Q. WHAT ALTERNATIVES TO LIQUIDATION DID OPTi CONSIDER?                          

A. In the face of declining sales of our existing semiconductor products,       
OPTi's Board and management considered a number of alternatives to        
 liquidation. Initially we took steps to minimize our operating costs and we
outsourced our research and development activities. We also shifted our   
strategy to pursue licenses as a means of settling potential patent       
infringement claims against companies which may be using our patented     
technology without our permission and we looked for areas where we could  
 develop or acquire technology for emerging markets in the electronics area,
increase sales in existing global markets and strengthen our industry     
relationships.                                                            

  Over the last twenty-four months, our Board and management also investigated
 various strategic opportunities and engaged in discussions regarding merger
and asset sale transactions with potential business partners and an       
investment bank. However, although we received a number of proposals and  
 engaged in several discussions during that period, OPTi did not receive any
definitive merger offers. After reviewing OPTi's business prospects and   
potential opportunities, our Board has determined that the voluntary      
liquidation and dissolution of the Company is in the best interest of our 
shareholders and will serve to maximize shareholder value in OPTi.        

Q: WHAT WILL HAPPEN IF THE LIQUIDATION PLAN IS NOT APPROVED?                    

A: If the Liquidation Plan is not approved, we will continue operating OPTi as  
an ongoing concern and there would be no distribution of cash or other    
property to shareholders arising from the liquidation of our assets.      

Q: WHEN DO YOU EXPECT THE LIQUIDATION TO BE COMPLETED?                          

A: We currently anticipate that the assets of OPTi that can be readily sold or  
  distributed in kind will be sold and/or distributed during the first half of
  2002. In addition, we plan to transfer OPTi's intellectual property relating
to our patents to the Liquidating Trust together with approximately $2.7  
million in cash to enable the pursuit of potential legal claims related to
our patents, to pay trust fees and expenses and to pay the claims, if any,
 of our creditors which have not been asserted or satisfied in full prior to
OPTi's dissolution. We believe that pursuing potential patent infringement
claims prior to the sale or other disposition of our patents will increase
  the likelihood that we can maximize the value of our patents for the benefit
of our shareholders. We may also transfer other assets that cannot be     
readily liquidated, if any, and other liabilities that cannot be readily  
satisfied, if any, to the Liquidating Trust for an orderly disposition and
satisfaction. Following such transfer, the Liquidating Trust would proceed
to liquidate the intellectual property related to our patents (along with 
  any other assets transferred to the Trust) over a period of three years. The
 term of the Liquidating Trust may be subject to extension for an additional
two years if a ruling that we have requested from the Internal Revenue    
Service allows us to do so and circumstances warrant.                     

Regardless of whether the duration of the Trust is three or five years, it
is possible that certain patent claims may not be fully resolved or paid  
  when the Trust terminates. In such event, the Trust can realize the value of
 such unresolved claims by selling the rights to pursue any then-open claims
or to collect any then-outstanding payments to third parties for lump-sum 
payments. The Trust would then distribute the proceeds of such lump-sum   
payments to the Trust beneficiaries prior to termination of the Trust.    

Q: WHEN WILL THE SHAREHOLDERS RECEIVE ANY PAYMENT FROM THE LIQUIDATION OF OPTi? 

A: If the Liquidation Plan is approved, we anticipate that an initial           
  distribution of available assets will be made to the shareholders in January
or February 2002. Thereafter, as we liquidate our remaining assets we will
distribute available liquidation proceeds to shareholders as our Board of 
Directors deems appropriate. We anticipate that the remaining liquidation 
proceeds for OPTi assets that can be readily sold or distributed will be  
  distributed over a period of one to four months. In addition, we expect that
the Liquidating Trust will continue to liquidate and distribute proceeds  
related to our intellectual property and the other assets held in         

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the Trust to shareholders as the Trustees deem appropriate. In such event,
we expect that the majority of the trust assets will be distributed over a
period of three years.                                                    

Q: WHAT AMOUNT WILL SHAREHOLDERS RECEIVE FROM THE LIQUIDATION OF OPTi?          

A: Due to the uncertainties as to the precise net realizable value of our       
assets and the ultimate settlement amount of our liabilities, it is       
impossible to predict with certainty the aggregate net values which will  
  ultimately be distributed to our shareholders should the Liquidation Plan be
approved. However, based upon information presently available to us and   
assuming no unanticipated claims or other material adverse events, we     
 believe our shareholders are likely to receive approximately $2.00 to $2.35
 per share from the initial distribution of net available assets expected to
 occur in January or February 2002. In addition, OPTi holds 1,914,155 shares
of common stock of Tripath Technology, Inc., a publicly traded company    
 quoted on the Nasdaq National Market. We will distribute all of the Tripath
shares to our shareholders in kind. As of December 10, 2001, the closing  
sale price of Tripath common stock was $1.78 per share. Each OPTi         
  shareholder as of the record date of distribution will receive approximately
0.17 shares of Tripath stock for each share of OPTi common stock held on  
that record date. The distribution of Tripath shares will be treated as a 
distribution in liquidation to OPTi shareholders. Shareholders entitled to
receive fractional shares of Tripath stock will instead receive a cash    
payment for the value of such fractional shares based on the closing sale 
price of Tripath stock on the record date of distribution. The tax        
  consequences to shareholders of their receipt of Tripath shares and cash for
  fractional shares are described further in "UNITED STATES FEDERAL INCOME TAX
CONSIDERATIONS."                                                          

Q: WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES OF THE LIQUIDATION AND          
DISSOLUTION TO ME?                                                        

A: In general, if the Liquidation Plan is approved, our shareholders will       
realize, for federal income tax purposes, gain or loss equal to the       
difference between (i) the sum of the cash plus the value of any property 
 distributed to our shareholders from the liquidating distributions plus the
value of any property transferred to the Liquidating Trust; and (ii) their
adjusted tax basis in their shares of OPTi common stock. The tax          
consequences may differ for each shareholder, depending on his or her     
circumstances. We urge each shareholder to consult with his or her own tax
advisors.                                                                 

We have requested a ruling from the Internal Revenue Service that the     
Liquidating Trust be treated as a grantor trust for federal income tax    
 purposes. However, if the IRS rules unfavorably, then the Liquidating Trust
  will be treated as a partnership for federal income tax purposes. Whether or
 not the IRS rules that the Liquidating Trust is to be treated as such or as
a partnership for federal income tax purposes, the shareholders' reporting
  obligations will be the same. If the Liquidating Trust is to be treated as a
partnership, the trust will have to comply with additional tax filing and 
  reporting requirements, which will result in greater administrative costs to
the trust. For federal income tax purposes, assets held by the Liquidating
  Trust should be treated as if they had first been distributed by OPTi to our
shareholders pro rata to their shareholdings and then contributed by our  
 shareholders to the Liquidating Trust. Consequently, shareholders should be
  aware that they may be subject to tax, whether or not they have received any
 actual distributions from the Liquidating Trust with which to pay such tax.
The same results would follow if the Liquidating Trust is treated as a    
partnership for federal income tax purposes. The tax consequences to      
shareholders are described further in "UNITED STATES FEDERAL INCOME TAX   
CONSIDERATIONS."                                                          

Q: DO I HAVE APPRAISAL RIGHTS?                                                  

A: No. Under California law, appraisal rights are not available in connection   
with the liquidation and dissolution.                                     

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Q: SHOULD I STILL VOTE TO ELECT OUR BOARD OF DIRECTORS AND RATIFY THE SELECTION 
 OF ACCOUNTANTS IF I APPROVE THE LIQUIDATION PLAN AND THE APPOINTMENT OF THE
TRUSTEES?                                                                 

A: Yes. Even if a shareholder votes to approve the Liquidation Plan, each       
 shareholder should vote on the proposal to elect our Board of Directors and
the proposal to ratify the appointment of Ernst & Young LLP as OPTi's     
independent accountants for the year ending December 31, 2001. If the     
  Liquidation Plan is adopted, our Board of Directors will oversee the orderly
  liquidation and dissolution of OPTi. In addition, if our shareholders do not
approve the Liquidation Plan, we will continue to operate as an ongoing   
concern and the Board members elected at this Annual Meeting will direct  
OPTi's continuing operations until their successors are elected or        
appointed. With respect to the proposal appointing Ernst & Young as our   
independent auditors, OPTi will still require the services of independent 
accountants to conduct yearly audits and other such matters for so long as
OPTi is obligated to comply with the applicable reporting requirements of 
the Securities Exchange Act of 1934, as amended.                          
Q: WHAT DO OPTi SHAREHOLDERS NEED TO DO NOW?                                    

A: After carefully reading and considering the information contained in this    
 Proxy Statement, including the Liquidation Plan attached as Annex A and the
form of Liquidating Trust Agreement attached as Annex B, each OPTi        
shareholder should complete and sign his or her proxy and return it in the
enclosed return envelope as soon as possible so that his or her shares may
  be represented at the meeting. A majority of shares entitled to vote must be
   represented at the meeting to enable OPTi to conduct business at the meeting.

Q: CAN OPTi SHAREHOLDERS CHANGE THEIR VOTE AFTER THEY HAVE MAILED THEIR SIGNED  
PROXIES?                                                                  

A: Any proxy given for the Annual Meeting may be revoked by the shareholder     
giving it at any time before the Annual Meeting by delivering to the      
Secretary of the Company, Michael Mazzoni, at our principal executive     
offices, 880 Maude Avenue, Suite A, Mountain View, California 94043, a    
written notice of revocation or a duly executed proxy bearing a later date
or by attending the Annual Meeting and voting in person. Attending the    
  Annual Meeting in and of itself will not constitute a revocation of a proxy.

Q: IF OPTi SHARES ARE HELD IN "STREET NAME" BY A SHAREHOLDER'S BROKER, WILL THE 
BROKER VOTE THESE SHARES ON BEHALF OF THE SHAREHOLDER WITH RESPECT TO THE 
APPROVAL OF THE LIQUIDATION PLAN AND THE ASSET PURCHASE AGREEMENT?        

A: A broker will vote OPTi shares with respect to the approval of the           
  Liquidation Plan only if the holder of these shares provides the broker with
instructions on how to vote. Shareholders should follow the directions    
provided by their brokers regarding how to instruct brokers to vote the   
shares.                                                                   

Q: CAN I SELL MY SHARES OF OPTi COMMON STOCK ONCE THE LIQUIDATION PLAN IS       
APPROVED?                                                                 

A: We expect that our common stock will continue to trade on the Nasdaq         
 National Market as long as we continue to meet Nasdaq's listing maintenance
standards. If our common stock is delisted from Nasdaq, trading, if any,  
would thereafter be conducted on the over-the-counter market in the       
so-called "pink sheets" or on the "Electronic Bulletin Board" of the      
  National Association of Securities Dealers, Inc. Consequently, if our common
  stock is delisted, shareholders may find it more difficult to dispose of, or
to obtain accurate quotations as to the price of our common stock. In     
addition, we intend to halt trading in OPTi shares in conjunction with the
filing of a certificate of dissolution with the state of California       
according to the following procedure: At the close of business on the     
business day immediately preceding the day that we file the certificate of
dissolution, we will close our stock transfer books and restrict transfers
 of our common stock. On the day that we file the certificate of dissolution
(the "Effective Date of Dissolution"), the following events will also take
place: (i) the                                                            

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Company will file a tax clearance certificate or an assumption of tax     
liability with the State of California, (ii) the Company and the Trustees,
on behalf of the beneficiaries of the Liquidating Trust, will execute the 
Liquidating Trust Agreement; (iii) any property remaining in OPTi will    
 either be distributed in a liquidating distribution to OPTi shareholders or
will be transferred to the Liquidating Trust as the first transfer of     
property into the Liquidating Trust (and will be a deemed liquidating     
distribution to the OPTi shareholders); (iv) beneficial interests in the  
Liquidating Trust will be distributed on a pro rata basis to the OPTi     
shareholders as of the Effective Date of Dissolution; and (v) all         
then-outstanding OPTi shares will be canceled. In no event will the       
Liquidating Trust Agreement be executed nor any property transferred into 
the Liquidating Trust prior to the Effective Date of Dissolution. In no   
event will any shares of OPTi be freely transferable on or after the      
Effective Date of Dissolution. The transfer of the beneficial interests in
the Liquidating Trust will also be restricted as described further in "THE
OPTi INC. LIQUIDATING TRUST."                                             

Of the Nasdaq requirements for continued listing, we believe that our     
ability to meet the following criteria will determine how long our shares 
continue to trade on the Nasdaq National Market:                          

     .  Our stockholders' equity must equal or exceed $10 million or our net
tangible asset must equal or exceed $4 million; and         
  .  The minimum daily per share bid price for our stock must equal or
exceed $1.                                                  

With respect to the net tangible asset requirement, we currently expect to
  retain approximately half or more of the $5 million in cash that we will use
  to fund a cash reserve set aside to satisfy our known current and contingent
liabilities (the "Contingency Reserve") and to fund the Liquidating Trust 
 until our final liquidating distribution prior to dissolution. At this time
 we can give no assurance as to the timing of payments to creditors from our
Contingency Reserve. Consequently, at this time we can also give no       
assurance as to the length of time that our net tangible assets will      
continue to meet the Nasdaq listing requirement once we commence our      
liquidating distributions.                                                

 With respect to the minimum bid price requirement, as of December 10, 2001,
 the closing sale price for our shares was $3.02. We expect that our initial
liquidating distribution will take place in January or February 2002 and  
OPTi shareholders will receive from $2.00 to $2.35 per share in cash and  
approximately 0.17 shares of Tripath stock per share of OPTi stock. The   
closing sale price of Tripath stock on December 10, 2001 was $1.78 per    
share. If we fail to meet Nasdaq's minimum bid price criterion for 30     
  consecutive business days, Nasdaq will notify us that we are not meeting the
requirement. We will then be given a 90 day grace period during which our 
shares must exceed the minimum bid price for at least ten consecutive     
 trading days for us to avoid being delisted at the end of the grace period.

Each of the above listing criteria has been the subject of recent Nasdaq  
  rulemaking action. However, OPTi does not currently expect the recent Nasdaq
rule changes to affect the length of time that its shares will remain     
listed. In May 2001, Nasdaq changed the $4 million minimum net tangible   
  asset requirement to a $10 million minimum stockholders' equity requirement.
However, companies such as OPTi that were listed on Nasdaq as of June 29, 
2001 may qualify for continued listing under either criteria until the old
 net tangible asset requirement expires on November 1, 2002. As we currently
expect to have completed our liquidation and filed a Certificate of       
  Dissolution in the first half of 2002, we do not believe that the expiration
 of the net tangible asset requirement will affect the listing of our shares
on the Nasdaq National Market.                                            

In September 2001, Nasdaq temporarily suspended the minimum bid price     
listing criterion until January 2, 2002. As we currently expect to make an
initial liquidating distribution of $2.00 to $2.35 per share in January or
February 2002, we do not expect the suspension of the minimum bid price   
criterion will affect the continued listing of our shares on the Nasdaq   
National Market.                                                          

 Regardless of whether Nasdaq delists our shares prior to the Effective Date
of Dissolution, we will close our stock transfer books at the close of    
business on the business day immediately preceding the Effective Date of  
  Dissolution. Thereafter, the shareholders will not be able to transfer their
shares, all OPTi shares will be canceled on the Effective Date of         
Dissolution, and beneficial interests in the Liquidating Trust will be    
distributed on a pro rata basis to the OPTi shareholders.                 

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Shareholders who are considering the sale of their stock should be aware  
that only persons who hold OPTi shares at the time of each liquidating    
distribution will receive that liquidating distribution. In addition, only
shareholders who continue to hold their shares until the Effective Date of
Dissolution will be entitled to receive beneficial interests in the       
Liquidating Trust that will be distributed pro rata based on each         
shareholder's proportionate holdings of OPTi shares and any subsequent    
distributions made from the Liquidating Trust to its beneficiaries. If the
shareholders approve the Liquidation Plan, the dates of each liquidating  
  distribution and the Effective Date of Dissolution will be announced by OPTi
as they are determined by OPTi's Board of Directors.                      

Q: WHO CAN HELP ANSWER QUESTIONS?                                               

A: If you have any additional questions about any of the proposals or if you    
need additional copies of this Proxy Statement or any public filings      
referred to in this Proxy Statement, you should contact: Michael Mazzoni, 
our Chief Financial Officer, at 880 Maude Avenue, Suite A, Mountain View, 
California 94043. Our public filings can also be accessed at the SEC's web
site at www.sec.gov.                                                      

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OPTi INC. 

PROXY STATEMENT FOR THE 2001 ANNUAL MEETING OF SHAREHOLDERS 

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

INFORMATION CONCERNING SOLICITATION AND VOTING  

General                                                                         

The enclosed proxy is solicited on behalf of OPTi Inc. ("OPTi" or the     
"Company") for use at the Annual Meeting of Shareholders (the "Annual Meeting") 
to be held on January 11, 2002 at 9:00 a.m., Pacific Time, or at any            
postponement or adjournment thereof, for the purposes set forth herein and in   
the accompanying Notice of Annual Meeting of Shareholders. The Annual Meeting   
will be held at the offices of Heller Ehrman White & McAuliffe LLP at 275       
Middlefield Road, Menlo Park, California 94025. The telephone number at that    
location is (650) 324-7000.                                                     

 These proxy solicitation materials were mailed on or about December  , 2001
to all shareholders entitled to vote at the meeting.                            

The Company has been informed that Breider, Moore & Co. ("Breider Moore") 
intends to nominate certain individuals for election to the Company's Board of  
Directors at the Annual Meeting. Election of such persons would give Breider    
Moore control of the Company. You may receive proxy soliciting materials from   
Breider Moore on behalf of its nominees. These nominees have NOT been endorsed  
by your Board. We urge shareholders not to return any proxy they receive from   
Breider Moore. If you have already done so, you may revoke that proxy by        
completing, signing and dating the enclosed WHITE proxy card and returning it   
in the enclosed envelope. The Company is not responsible for the accuracy of    
any information provided by or relating to the Company contained in any proxy   
materials filed or disseminated by Breider Moore or any other statement it      
makes.                                                                          

Purposes of the Annual Meeting                                                  

 The purposes of the Annual Meeting are to (i) approve and adopt the Plan of
Complete Liquidation and Dissolution of OPTi Inc. (the "Liquidation Plan" or    
the "Plan"); (ii) approve the appointment of three Trustees of the OPTi Inc.    
Liquidating Trust; (iii) elect four directors to serve until the earlier of (x) 
the dissolution of OPTi; (y) OPTi's next annual meeting; or (z) the appointing  
of their successors; (iv) ratify the appointment of Ernst & Young LLP as the    
Company's independent auditors for the fiscal year 2001 and (v) transact such   
other business as may properly come before the Annual Meeting and at any and    
all postponements or adjournments thereof.                                      

Annual Meeting Record Date and Share Ownership                                  

Only shareholders of record at the close of business on December 7, 2001  
(the "Annual Meeting Record Date") are entitled to receive notice of and to     
vote at the Annual Meeting. On the Annual Meeting Record Date, 11,633,903       
shares of the Company's common stock were issued and outstanding. For           
information regarding security ownership by management and by 5% shareholders,  
see "OTHER INFORMATION--Security Ownership of Certain Beneficial Owners and     
Management." The closing price of the Company's common stock on the Nasdaq      
National Market on the Annual Meeting Record Date was $3.03 per share.          

Revocability of Proxies                                                         

Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to Michael Mazzoni,          
Secretary of the Company at its principal executive offices, 880 Maude Avenue,  
Suite A, Mountain View, California 94043, a written notice of revocation or a   
duly executed proxy                                                             

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bearing a later date or by attending the Annual Meeting and voting in person.   
Attending the Annual Meeting in and of itself will not constitute a revocation  
of a proxy.                                                                     

Voting and Solicitation                                                         

Every shareholder voting in the election of directors may cumulate such   
shareholder's votes and give one candidate a number of votes equal to the       
number of directors to be elected multiplied by the number of shares held by    
such shareholder, or distribute the shareholder's votes on the same principle   
among as many candidates as the shareholder deems fit, provided that votes      
cannot be cast for more than four (4) candidates. However, no shareholder shall 
be entitled to cumulate votes unless the candidate's name has been placed in    
nomination prior to the voting and the shareholder, or any other shareholder,   
has given notice at the Annual Meeting prior to the voting of the intention to  
cumulate the shareholder's votes. On all other matters, each share has one (1)  
vote.                                                                           

  Shares of common stock represented by properly executed proxies will, unless
such proxies have been previously revoked, be voted in accordance with the      
instructions indicated thereon. In the absence of specific instructions to the  
contrary, properly executed proxies will be voted: (i) FOR the approval and     
adoption of the Liquidation Plan;(ii) FOR the approval of the appointment of    
the three Trustees; (iii) FOR the election of each of the Company's nominees as 
a director; and (iv) FOR ratification of the appointment of Ernst & Young LLP   
as independent auditors for fiscal 2001. No business other than that set forth  
in the accompanying Notice of Annual Meeting of Shareholders is expected to     
come before the Annual Meeting. Should any other matter requiring a vote of     
shareholders properly arise, the persons named in the enclosed form of proxy    
will vote the shares they represent as the Board of Directors may recommend.    

 The cost of this solicitation will be borne by the Company. The Company may
reimburse brokerage firms and other persons representing beneficial owners of   
shares for their expenses in forwarding solicitation material to such           
beneficial owners. Proxies may also be solicited by certain of the Company's    
directors, officers and regular employees, without additional compensation,     
personally or by telephone, telegram or letter. The Company has retained        
Mackenzie Partners, Inc. to assist in the solicitation of proxies from brokers, 
nominees, institutions and individuals. For additional information concerning   
solicitation of proxies, see "Certain Information Concerning Nominations by     
Breider Moore - Solicitation Information" below.                                

Quorum; Abstentions; Broker Non-Votes                                           

  The required quorum for the transaction of business at the Annual Meeting is
a majority of the shares of common stock issued and outstanding on the Annual   
Meeting Record Date. Shares that are voted "FOR" or "AGAINST" a matter are      
treated as being present at the meeting for purposes of establishing a quorum   
and are also treated as shares "represented and voting" at the Annual Meeting   
(the "Votes Cast") with respect to such matter.                                 

The Company intends to include abstentions and broker non-votes as present
or represented for purposes of establishing a quorum for the transaction of     
business. With respect to Proposal No. 1 only, an affirmative vote by a         
majority of the shares outstanding on the Annual Meeting Record Date is         
required in order to approve the proposal. Accordingly, abstentions and broker  
non-votes will have the effect of votes against Proposal No. 1.                 

With respect to the election of directors, the four persons receiving the 
greatest number of votes will be elected to the Board. With respect to other    
proposals, abstentions are counted against a proposal for purposes of           
determining whether or not a proposal is approved, whereas broker non-votes are 
not counted for the purpose of determining whether a proposal has been approved.

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Deadline for Receipt of Shareholder Proposals                                   

  If the Company is not dissolved in accordance with Proposal No. 1, proposals
of shareholders of the Company which are intended to be presented by such       
shareholders at the 2002 Annual Meeting of Shareholders must be received by the 
Company no later than October 19, 2002 in order to have them included in the    
proxy statement and form of proxy relating to that meeting. In addition,        
proposals of the Company's shareholders that such shareholders intend to        
present at the Company's 2002 Annual Meeting, but not include in the Company's  
Proxy Statement and form of Proxy relating to the 2002 Annual Meeting, must be  
received by the Company at the Company's offices no later than November 4, 2002 
and no earlier than October 20, 2002.                                           

Fiscal Year End                                                                 

  The Company's fiscal year ends on December 31. Fiscal 2000 ended on December
31, 2000 and is referred to herein as the "Last Fiscal Year."                   

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PROPOSAL NUMBER 1 

APPROVAL AND ADOPTION OF THE  
PLAN OF COMPLETE LIQUIDATION AND DISSOLUTION OF OPTi INC. 

General                                                                         

Our Board of Directors is proposing that the voluntary Liquidation Plan be
approved and adopted by our shareholders at the Annual Meeting. The Plan was    
authorized by our Board of Directors (the "Board"), subject to shareholder      
approval, on September 7, 2001. A copy of the Plan is attached as Annex A to    
this Proxy Statement. Certain material features of the Plan are summarized      
below. Shareholders should read the Plan in its entirety.                       

Our Board has authorized, subject to shareholder approval, the orderly    
liquidation of OPTi's assets and the dissolution of the Company pursuant to the 
Plan. The Plan provides that, if the requisite shareholder approval is received 
(such time of approval is the "Adoption Date"), our officers and directors will 
initiate the complete liquidation and subsequent dissolution of OPTi and will   
file a Certificate of Election to Wind Up and Dissolve (the "Certificate of     
Election") with the State of California. After the Adoption Date, we will not   
engage in any business activities except for the purpose of preserving the      
value of our assets, prosecuting and defending lawsuits by or against us or our 
subsidiaries, adjusting and winding up our business affairs, selling and        
liquidating all of our assets, paying our creditors and making distributions to 
shareholders in accordance with the Plan. Following the Adoption Date, in       
addition to filing the Certificate of Election, we expect to establish the OPTi 
Inc. Liquidating Trust (the "Liquidating Trust" or "Trust") and transfer to the 
Trust all of our patents, other intellectual property, approximately $2.7       
million in cash, and other assets that cannot be readily liquidated or          
distributed in kind immediately prior to the dissolution of the Company         
(collectively, the "Trust Assets") pursuant to the Plan and to the Liquidating  
Trust Agreement between OPTi and the trustees of the Trust (the "Trustees"). A  
copy of the Form of Liquidating Trust Agreement is attached as Annex B to this  
Proxy Statement. Our Board of Directors has appointed Stephen A. Dukker, Kapil  
K. Nanda and William H. Welling to serve as Trustees of the Liquidating Trust.  
In Proposal No. 2, shareholders are being asked to approve the appointment of   
such persons as the Trustees.                                                   

  During the liquidation of our assets, we may pay to our officers, directors,
employees, and agents, or any of them, compensation for services rendered in    
connection with the implementation of the Plan and/or retention and severance   
benefits. Your approval of the Plan will constitute your approval of the        
payment of any such compensation.                                               

The following resolution will be offered at the Annual Meeting:           

"RESOLVED, THAT THE VOLUNTARY PLAN OF COMPLETE LIQUIDATION AND DISSOLUTION OF 
OPTi INC. INCLUDING THE ESTABLISHMENT OF THE OPTi INC. LIQUIDATING TRUST  
RECOMMENDED BY THE BOARD OF DIRECTORS BE APPROVED AND ADOPTED." 

BACKGROUND AND REASONS FOR THE LIQUIDATION PLAN 

Since our incorporation in California in 1989, OPTi has conducted business
as an independent supplier of semiconductor products that provide core logic    
functions or universal serial bus controller functions for a personal computer  
or embedded product within a semiconductor device. Through 1995, our principal  
business was our core logic products for desktop personal computers and we have 
employed as many as 235 employees over the years. However, in time, OPTi faced  
increasingly tight competition and we decided to shift our design, development, 
marketing and sales efforts away from our core logic products and towards       
peripheral products such as our universal serial bus devices. During February   
1999, OPTi completely ceased further development of core logic products, even   
though we continued to ship such products to our customers.                     

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Over the past several years, we have been facing tightening conditions and
increased competition in each of our markets despite our patented technology.   
In light of these increasingly difficult competitive conditions, our Board has  
in the past determined that the return of unallocated capital to our            
shareholders can be a more effective means of maximizing shareholder value than 
committing such capital to the pursuit of uncertain new technology initiatives. 
Consistent with our philosophy, in 1998 we repurchased approximately $23.9      
million worth of our common stock and in 1999 we declared a cash dividend of    
$4.00 per share of our common stock which resulted in the return of             
approximately $44.4 million to our shareholders.                                

Over the last 24 months, OPTi's Board and management have investigated    
various strategic opportunities and engaged in discussions regarding merger and 
asset sale transactions with potential business partners and an investment      
bank. During that period we engaged in several discussions regarding possible   
mergers and the sale of our assets. However, we did not receive any definitive  
merger offers. In addition, we redirected our primary business strategies       
towards, among other things, the pursuit of licenses as a means of settling     
potential patient infringement claims against companies which may be using      
technology covered by our patents without our permission and the pursuit of     
opportunities to develop or acquire technology for other emerging markets in    
the electronics area. We have also taken steps to minimize our overhead         
expenses as revenues from our existing products has continued to decline. We    
temporarily suspended our orders of inventory from semiconductor foundries      
during the third quarter of 2001. Additional orders to the foundries were       
placed later in the quarter. Although the decline in customer orders has slowed 
since we announced that our Board had approved the Liquidation Plan, we believe 
many of the recent orders to be close-out orders from customers in anticipation 
of OPTi's liquidation. Our decision on whether to continue to place orders with 
foundries will depend upon the level of demand for OPTi products and whether    
OPTi shareholders approve the Liquidation Plan.                                 
Since December 31, 1999, we have reduced our workforce from 45 to six     
employees. We began second quarter 2001 with 17 employees so our reductions in  
workforce are continuing due to the ongoing decline in demand for our products  
and our decision to cease marketing efforts related to a product development    
program that failed to meet our expectations. After reviewing OPTi's business   
prospects and potential opportunities, our Board has determined that the        
voluntary liquidation and dissolution of the Company is in the best interest of 
our shareholders and will serve to maximize shareholder value in the Company.   
In making that determination, the Board and management reviewed a number of     
alternatives.                                                                   

Throughout 1999, we had engaged an investment bank to solicit interest in 
the acquisition of some or all of our business and assets. However, we failed   
to receive any definitive offers that we believed reflected the fair market     
value of our business or our technology. Accordingly, we ceased our engagement  
of the investment bank prior to the end of 1999.                                

In January 2000, OPTi management and the Board determined that OPTi's     
internal design efforts had not been productive or cost-effective. The Company  
decided it would be more cost-effective to subcontract OPTi's ongoing research  
and development to outside design groups and it terminated its internal         
research and development staff as part of a restructuring plan aimed at         
reducing operating costs. On January 31, 2000, at a Board meeting of the        
Company, the Board members discussed several alternatives for the Company and   
directed management to investigate various options including: a) acquisitions   
of new technology; b) partnering with other companies in related industries; c) 
liquidation of the Company and distribution of the Company's assets to the      
shareholders; and d) other strategic alternatives.                              

The Board further reviewed possible strategic alternatives in May of 2000.
Management presented its preliminary findings with respect to proposals to: a)  
merge with or invest in privately held companies with promising complementary   
technologies as a means of leveraging OPTi's industry relationships and its     
cash position; b) new directions for OPTi's product development, including the  
acquisition of new technologies; and c) various alternatives on how to utilize  
OPTi's patent position to realize maximum value for OPTi shareholders,          
including the sale of OPTi patents and the identification and valuation of      
potential targets for patent infringement claims. The Board instructed          
management to continue its efforts.                                             

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At the direction of the Board, management continued to investigate and    
entertain proposals of alternative business strategies. Throughout the period   
from June 2000 through July 2001, more than 15 companies with businesses        
unrelated to OPTi's approached OPTi with proposals to either merger, sell an    
equity position to OPTi or sell technology to OPTi. After investigation, OPTi   
management determined that the companies making these proposals did not possess 
proven technologies and were primarily interested in obtaining access to OPTi's 
cash and other liquid assets. Management reviewed these proposals with the      
Board at its periodic meetings between September 2000 and July 2001. The Board  
agreed with management's determination that the proposals were unrelated to     
OPTi's current business and represented substantial risk for OPTi shareholders. 

Throughout 2000, management also continued to investigate alternatives to 
realize the maximum value of OPTi's patented technology. Management discussed   
the sale of OPTi's technology including OPTi's patents, with three potential    
acquirers. Management also searched for a suitable law firm to assist OPTi in   
determining the strength of OPTi's patent position, the scope of potential      
patent infringement claims and the likelihood of recovering damages for past    
and ongoing infringement. In July 2000, OPTi entered into an agreement with     
outside legal counsel to represent OPTi on a contingent fee arrangement. The    
development and status of OPTi's strategy for pursuing potential Infringement   
Claims is further discussed in "PRINCIPAL PROVISIONS OF THE LIQUIDATION PLAN    
AND DISSOLUTION--The OPTi Inc. Liquidating Trust."                              

In November 2000, we began discussions with a publicly traded Company     
regarding the possible acquisition of OPTi. After several months of extended    
meetings between the two companies the potential acquirer declined to continue  
the transaction citing concerns over the public market environment.             
Negotiations were subsequently suspended.                                       

In April 2001, we renewed our discussions with the publicly traded company
with whom we had previously suspended discussions. Again, the potential         
acquirer declined to continue the transaction citing concerns over the public   
marketplace.                                                                    

In May 2001, management began the discussion of other possible merger     
transactions with an investment bank that represented possible merger partners. 
However, in each instance, the merger partners proposed to us by the investment 
bank were cash-poor companies that did not possess fully developed or proven    
technologies and thereby represented a substantial risk to OPTi's shareholders. 
Consequently, these discussions did not result in the identification of a       
merger partner that the Board considered suitable.                              

On July 13, 2001, the Board members discussed the strategic alternatives  
with management. The Board reviewed management's efforts to acquire new         
technology, find an acquirer for OPTi's technology, recent merger offers from   
companies with unrelated businesses, and the liquidation of OPTi. The Board     
requested that additional information from the management team be presented to  
them so that they could analyze what was the best alternative to maximize       
shareholder value. Management also informed the Board that OPTi's primary       
research and development projects on alternative universal serial bus chips and 
combined chipsets had yielded disappointing results due to delay in getting     
finished product to the marketplace and, in the opinion of management, no       
longer justified the continuing expenditure of OPTi's resources. The Board      
directed management to cease the development and the related marketing efforts. 
The Board also reviewed then-current revenue forecasts and decided to reduce    
the workforce to the minimum necessary to support OPTi's continuing business    
while the Board continued to assess strategic alternatives with management.     
Accordingly, OPTi reduced its workforce from 15 to seven employees.             

On July 20, 2001, the Company's Board of Directors reviewed the Company's 
second quarter and first half of 2001 financial results. Revenues for the       
quarter ended June 30, 2001 of $1,665,000 were $1,659,000, or 50%, below        
revenues reported for the comparable quarter of 2000. Due to the decline in     
revenue, OPTi's operating loss was larger than anticipated. In addition, the    
Board discussed management projections showing that the third quarter 2001      
revenue would continue to decline from prior periods and operating losses would 
continue to grow. In view of the accelerating decline in OPTi's business        
prospects, the Board determined that OPTi's business                            

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operations would result in continuing losses and the erosion of shareholder     
value. The Board directed management to review the available strategic          
alternatives and recommend a strategic alternative to the Board as soon as      
practicable.                                                                    

On July 23, 2001, OPTi announced that it was actively looking into all    
strategic alternatives in an effort to maximize shareholder value and expected  
to announce an alternative to its current business plan as soon as practical.   

  During August 2001, OPTi management determined that the complete liquidation
and dissolution of OPTi was the strategic alternative most likely to maximize   
shareholder value and management proceeded to consult with its independent      
auditors and outside counsel to draft the Liquidation Plan and a ruling request 
regarding tax treatment of the potential liquidation to the IRS. Management     
advised the Board of its determination that the liquidation of OPTi was the     
alternative most likely to maximize shareholder value and provided the          
Liquidation Plan to the Board for its review. On August 28, 2001, OPTi filed a  
ruling request with the IRS to ascertain tax treatment of the liquidation       
should the Liquidation Plan proposed by management be adopted by OPTi's Board   
and shareholders.                                                               

On September 7, 2001, the OPTi Board met and further reviewed the         
Liquidation Plan with management. Management also advised the Board on the      
status of certain other strategic alternatives, each of which, in management's  
judgment, would place OPTi's assets at unnecessary risk. Management further     
advised the Board that although its pursuit of claims for the potential         
infringement of OPTi patents by other semiconductor manufacturers was           
progressing, it would be premature to attempt to settle the claims, it would be 
difficult for OPTi to realize the full potential value of the infringement      
claims for its shareholders if OPTi or its patent portfolio were sold at that   
time and that the most likely means by which the potential value of the         
infringement claims could be maximized for OPTi shareholders would be to        
continue to pursue the claims following the liquidation and dissolution of OPTi 
by transferring the OPTi patents, to a liquidating trust. After further         
discussion, the Board of Directors unanimously approved the Liquidation Plan    
for adoption by OPTi shareholders. The Board concluded that the Plan was in the 
best interest of OPTi and its shareholders after considering a number of        
factors discussed below in "FACTORS CONSIDERED BY THE OPTi BOARD IN APPROVING   
THE PLAN OF LIQUIDATION."                                                       

 Currently, most of our assets are readily transferable. As of September 30,
2001, the end of our most recent fiscal quarter, approximately 92% of our $34.2 
million in total assets was held in cash, cash equivalents and marketable       
securities including 1,914,155 shares of Tripath Technology, Inc., a publicly   
traded company quoted on the Nasdaq National Market ("Tripath"). As of          
September 30 the market value of our Tripath shares was approximately $1.1      
million, or 3% of our assets.                                                   

  In addition, we are currently investigating potential claims against certain
third parties for infringement of certain of our patents (the "OPTi Patents")   
(such claims collectively referred to as the "Infringement Claims"). Because    
the Infringement Claims are not presently distributable or marketable, the      
Board of Directors has decided to establish a Liquidating Trust to hold the     
OPTi patents, the Infringement Claims, other intellectual property and any      
other assets that prove difficult to liquidate in an orderly fashion prior to   
our dissolution. OPTi intends to obtain from Standard & Poor's, nationally      
known corporate valuation consultants experienced in appraising intellectual    
property and related intangibles, an appraisal of the fair market values of the 
OPTi Patents and Infringement Claims at the time that those properties are      
transferred to the Liquidating Trust.                                           

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FACTORS CONSIDERED BY THE OPTi BOARD IN APPROVING THE PLAN OF LIQUIDATION 

The following discussions of the "Factors Leading to the Recommendation of
the Plan of Liquidation" and the "Factors Regarding the Potential Adverse       
Impact of the Plan of Liquidation" are not meant to be exhaustive, but are      
believed to include the material factors considered by the Board of Directors.  
The Board of Directors did not quantify or attach any particular weight to the  
various factors that it considered in approving the Liquidation Plan. Rather,   
the Board viewed its position and recommendation as being based on the totality 
of the information presented to and considered by it. In addition, individual   
members of the Board of Directors may have given different weights to different 
factors. However, in the unanimous view of the Board of Directors, the          
potentially negative factors considered by it did not outweigh the benefits and 
advantages of the liquidation and dissolution.                                  

Factors Leading to the Recommendation of the Plan of Liquidation                

Among the factors the Board considered were:                              

  .  Our recent unsatisfactory revenue performance, particularly the results
from the fiscal quarter ended June 30, 2001.                      

.  Sales forecasts that projected further sales declines and continuing 
losses.                                                           

   .  Financial projections that despite deep cutbacks in OPTi's workforce and
overhead, operating losses would continue.                        

 .  Our inability to get new product designs to market to offset declining
      revenue from our existing product lines due to the disappointing results
     of our primary research and development projects to develop alternative
universal serial bus chips and combined chipsets.                 

.  Prevailing economic conditions both generally and within the         
   semiconductor sector which resulted in a substantial reduction in the
       likely demand for and success of any new product or business initiatives.

.  Our inability to identify a buyer or strategic alliance partner      
acceptable to us.                                                 

.  The significant risks associated with restructuring our business,    
     including the risk that positive operating income could not be achieved
in a period satisfactory to the Board.                            

.  The Boards' belief that distribution of our assets in liquidation and
  the formation of the Liquidation Trust to oversee the pursuit of our
      patent position could produce more value to our shareholders than if the
  shareholders held their shares of common stock and OPTi continued to
incur operating losses.                                           

Factors Regarding the Potential Adverse Impact of the Plan of Liquidation       

The Board of Directors also considered a number of factors regarding the  
potential adverse impact of the proposed liquidation and dissolution on our     
shareholders, including the following:                                          

   .  There can be no assurance that we will be successful in disposing of our
  assets for values equal to or exceeding those currently estimated or
that these dispositions would occur as early as we expected.      

   .  It is possible that the liquidation may not yield distributions as great
    as the recent market prices of our shares and distributions may not be
effected for an extended amount of time.                          

  .  Shareholders may be liable to creditors of OPTi for the amount received
     from OPTi if OPTi reserves are inadequate to discharge our liabilities.

  .  As opposed to a business combination with a relatively short time frame
  during which a third party would acquire us, the liquidation process
  would involve a longer pay-off process and would require us to incur
potentially larger administrative costs.                          

.  The receipt of liquidating distributions, including the transfer of  
property into the Liquidating Trust (but not the receipt of a     
   Liquidating Trust interest), will be taxable events for shareholders.

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   .  It is likely that the liquidity and price of our shares will decrease as
we pay distributions to shareholders.                             

Conclusion of our Board of Directors                                            

On September 7, 2001, our Board of Directors unanimously adopted the      
Liquidation Plan. In arriving at this conclusion, our Board considered a number 
of factors, including those discussed above and those discussed in the "FACTORS 
TO BE CONSIDERED BY SHAREHOLDERS IN DECIDING WHETHER TO APPROVE THE PLAN"       
section below, in light of the future prospects of OPTi if it continued its     
existing business plan. Our Board of Directors concluded that the Liquidation   
Plan was in the best interests of OPTi and our shareholders.                    

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FACTORS TO BE CONSIDERED BY SHAREHOLDERS IN DECIDING  
WHETHER TO APPROVE THE PLAN 

There are many factors that OPTi's shareholders should consider when      
deciding whether to vote to approve the Plan. These factors include the factors 
considered by our Board discussed above in "FACTORS CONSIDERED BY OUR BOARD IN  
APPROVING THE PLAN OF LIQUIDATION," and the risk factors related to OPTi's      
ongoing business prospects, which are described in OPTi's Annual Report on Form 
10-K for the fiscal year ended December 31, 2000, OPTi's Quarterly Reports on   
Form 10-Q for the quarters ended March 31, 2001, June 30, 2001 and September    
30, 2001, which are incorporated by reference in this proxy statement. We       
believe that these factors, in combination with the additional risk factors set 
forth below, represent all the material factors that shareholders should        
consider when deciding whether to vote to approve the Plan.                     

Forward looking statements with respect to the likelihood and the value of      
liquidating distributions to our shareholders are based upon facts known to us  
and the methods we used with respect to the valuation of our assets and our     
liabilities. We can offer no assurance that the markets for our assets will not 
change or that additional liabilities currently unknown to us will not arise    
during the course of our liquidation and dissolution that could materially      
reduce the value and change the timing of the liquidating distributions.        

 This Proxy Statement contains certain forward looking statements, including
statements contained under the heading "LIQUIDATION ANALYSIS AND ESTIMATES"     
below and other statements concerning the value of OPTi's net assets, the       
liquidation value per share of common stock as compared to our market price     
absent the proposed liquidation and the likelihood of shareholder value         
resulting from the sale of certain of our significant assets. The methods used  
by our Board of Directors and management in estimating the value of OPTi's      
assets do not result in an exact determination of value nor are they intended   
to indicate definitively the amount a shareholder will receive in liquidation.  
Specifically, estimates regarding final proceeds from the sale of assets and    
the ultimate disposition of the remaining non-cash assets to third party        
acquirers are subject to many variables and will not be determined with         
certainty until the settlement of remaining liabilities.                        

The prices at which we will be able to sell our various non-cash assets is      
uncertain and no assurance can be given that the amount to be received in       
liquidation will equal or exceed the price of our common stock                  

In addition to the distribution of our cash and cash-equivalent assets to 
our shareholders, we will need to liquidate our excess inventory, property and  
equipment and accounts receivable. The cash value realized by OPTi for these    
assets will be difficult to estimate, and we can make no assurance that we will 
receive any material amounts with respect to such assets. The prices at which   
we will be able to sell our various remaining assets will depend largely on     
factors beyond OPTi's control including, without limitation, the condition of   
financial markets, the availability of financing to prospective purchasers of   
the assets, United States and foreign regulatory approvals, public market       
perceptions and limitations on transferability of certain assets. No assurance  
can be given that the amount to be received in liquidation will equal or exceed 
the price or prices at which the common stock has recently traded or may trade  
in the future. In addition, we will incur costs and expenses associated with    
the liquidation that we normally would not incur, which will increase our       
overall costs. Shareholders who disagree with our Board of Directors'           
determination that the adoption of the Plan is in the best interests of OPTi    
and our shareholders should vote "against" approval of the Plan.                

Shareholders may be liable to creditors of OPTi for the amount received from    
OPTi if OPTi's reserves are inadequate                                          

If the Plan is approved by the shareholders, a Certificate of Election to 
Wind Up and Dissolve initiating the dissolution procedure will be filed with    
the State of California. As described below, on the Effective Date of           
Dissolution the final liquidating distribution will be determined and a         
Certificate of Dissolution dissolving OPTi will be filed with the State of      
California. Pursuant to the California Corporations Code, if OPTi fails to      
adequately provide for payment of its expenses and liabilities, each            
shareholder could be held liable for payment                                    

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to OPTi's creditors of such shareholder's pro rata share of amounts owed to     
creditors in excess of the funds reserved to pay such creditors. Under          
California law, creditors would have up to four years from the filing of the    
Certificate of Dissolution to bring claims against OPTi. The liability of any   
shareholder would be limited to the amounts previously received by such         
shareholder from OPTi (and from the Liquidating Trust) following adoption of    
the Plan. Accordingly, in this event, a shareholder could be required to return 
all liquidating distributions previously made to such shareholder. As a result, 
a shareholder could net nothing from OPTi under the Plan. Moreover, in the      
event a shareholder has paid taxes on amounts previously received, a repayment  
of all or a portion of such amount could result in a shareholder incurring a    
net tax cost if the shareholder's repayment of an amount previously distributed 
does not cause a commensurate reduction in taxes payable. There can be no       
assurance that OPTi has adequate assets to cover any expenses and liabilities.  
However, after a review of our assets and liabilities, OPTi believes that the   
reserves will be adequate and that a return of amounts previously distributed   
will not be required. See "PRINCIPAL PROVISIONS OF THE LIQUIDATION PLAN AND     
DISSOLUTION-Contingent Liabilities; Contingency Reserve; The OPTi Inc.          
Liquidating Trust and LIQUIDATION ANALYSIS AND ESTIMATES."                      

 In addition, those persons who were OPTi shareholders at the time of OPTi's
November 1999 cash dividend could theoretically remain subject to creditor      
claims under the California Civil Code. Under California law, persons who       
receive transfers from other persons whose remaining assets following the asset 
transfer are inadequate to pay their existing liabilities at the time they      
become due, may be subject to claims by creditors for up to four years          
following the date of the asset transfer. If the Liquidation Plan is approved,  
such creditors, if any, who, after OPTi dissolves, assert that they have claims 
that existed prior to the date of the November 1999 cash dividend, could choose 
to pursue those claims against the Liquidating Trust and the persons who        
received the November 1999 cash distribution. Such persons could be liable to   
creditors up to the aggregate amount of the November 1999 dividend, which was   
$4.00 per share, that each such person received. Nonetheless, the risk of such  
liability turns on facts and conditions present at the time of the November     
1999 cash dividend, and the risk that such liability may exist is therefore not 
altered by whether or not OPTi's shareholders decide to adopt the Liquidation   
Plan. However, should such claims be made after OPTi has dissolved, it may be   
more likely that such creditors, if any, might seek to recover their claims     
from persons who received the November 1999 cash dividend because the creditors 
would no longer be able to recover any funds directly from OPTi. OPTi's         
management currently has no knowledge of any claims that existed prior to the   
November 1999 distribution which remain unsatisfied or which might otherwise    
subject the recipients of the cash dividend to liability under California law.  

Our common stock may be delisted from Nasdaq prior to the Effective Date of     
Dissolution.                                                                    

  As we commence our liquidating distributions, the amount of assets remaining
in OPTi will decline and our ability to meet Nasdaq's listing requirements may  
be threatened. If our common stock is delisted from Nasdaq prior to the         
Effective Date of Dissolution, shareholders will likely find it more difficult  
to dispose of the common stock, or to obtain quotations as to the price of the  
common stock. See "PRINCIPAL PROVISIONS OF THE LIQUIDATION PLAN AND             
DISSOLUTION-Listing and Trading of the OPTi Common Stock and the Beneficial     
Interests in the Liquidating Trust."                                            

Our stock transfer books will close at the close of business on the day prior   
to the Effective Date of Dissolution after which it will not be possible for    
shareholders to publicly trade in our stock                                     

We intend to close our stock transfer books and discontinue recording     
transfers of common stock at the close of business on the day prior to the date 
OPTi files the Certificate of Dissolution. On the following day when OPTi files 
the Certificate of Dissolution, the Effective Date of Dissolution, the          
Liquidating Trust will be established, each OPTi shareholder will receive a pro 
rata beneficial interest in the Liquidating Trust and all OPTi shares will be   
cancelled. The beneficial interests in the Liquidating Trust will be            
non-transferable except as a result of any assignments by will, intestate       
succession or operation of law.                                                 

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We do not have an alternative business plan that we believe is viable that we   
can turn to if shareholders do not approve the Liquidation Plan                 

Our Board unanimously approved the Liquidation Plan based upon the factors
outlined above after considering several strategic alternatives to liquidation  
and dissolution which are also described above. There are currently no viable   
strategic alternatives to the Plan if the shareholders do not approve the       
Liquidation Plan and we can offer no assurance that the strategic alternatives  
previously considered by the Board will still be available or feasible if the   
Plan is rejected. If our shareholders decide not to approve the Plan, we will   
return to the operation of our existing business which we believe is no longer  
profitable and we will continue to pursue the Infringement Claims while we      
search for new strategic alternatives. There can be no assurance that any such  
new strategic alternative will be found or that it will provide for a return on 
shareholder value equal to or greater than the Liquidation Plan.                

Our board members may have a potential conflict of interest in recommending     
ratification and approval of the Plan                                           

The members of our Board of Directors may be deemed to have a potential   
conflict of interest in recommending ratification and approval of the Plan. See 
"POSSIBLE EFFECTS OF THE APPROVAL OF THE PLAN UPON DIRECTORS, OFFICERS AND      
CERTAIN EMPLOYEES."                                                             

POSSIBLE EFFECTS OF THE APPROVAL OF THE PLAN  
UPON DIRECTORS, OFFICERS AND CERTAIN EMPLOYEES  

Other than as set forth below, it is not currently anticipated that the   
liquidation of OPTi will result in any material benefit to any of our officers  
or to directors who participated in the vote to adopt the Plan, or to any other 
employees.                                                                      

As summarized in the table below, our Board of Directors has approved     
severance arrangements for Bernard T. Marren, our President, Chief Executive    
Officer and Chairman of the Board, and Michael Mazzoni, our Chief Financial     
Officer. Mr. Marren will be paid his severance package if the Company is sold   
or he is terminated. Mr. Mazzoni will be paid his severance package in the      
event of a change of control of OPTi or if OPTi announces its intent to         
liquidate its assets or shut down the Company. In conjunction with its approval 
of the Liquidation Plan, the Board affirmed that both Mr. Marren and Mr.        
Mazzoni's severance packages will be paid if the Liquidation Plan is adopted by 
the shareholders and OPTi completely dissolves.                                 

                                                        [Enlarge/Download Table]

Name and Principal Position                                                     Severance Other
---------------------------                                                     --------- -----
                                                                                               
Bernard T. Marren, President, Chief Executive Officer and Chairman of the Board $150,000   (1) 
Michael Mazzoni, Chief Financial Officer....................................... $150,000   --  

--------                                                                        
(1) Mr. Marren will also receive a severance payment related to the value of    
the initial liquidating distribution and the number of vested options he
   holds. The Company currently estimates the value of this additional payment
at a maximum of $250,000.                                               

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The table below sets forth information relating to stock options held by  
each officer and director of OPTi, as of November 30, 2001.                     

                                                                [Download Table]

                                                                    Weighted
                                                                    Average 
                                                                    Exercise
                                           Total            In The  Price of
                                          Options   Vested   Money   Vested 
Name                                    Outstanding Options Options Options 
----                                    ----------- ------- ------- --------
                                                                            
Bernard T. Marren......................   117,333   117,333   --     $4.98  
Michael Mazzoni........................        --        --   --        --  
Stephen A. Dukker......................        --        --   --        --  
Kapil K. Nanda.........................    17,333    17,333   --     $6.99  
William H. Welling.....................        --        --   --        --  

  Additionally, each OPTi employee who continues his or her employment through
OPTi's final dissolution will receive a severance payment equal to the greater  
of his or her weekly salary multiplied by his or her years of service or one    
month's pay. We currently estimate these payments will total approximately      
$55,000.                                                                        

  Our Board of Directors may confer other benefits or bonuses to employees and
officers of OPTi, including officers who are also directors, in recognition of  
their services to OPTi based on the performance of such employees and officers, 
including performance during OPTi's liquidation process.                        

In addition, if the OPTi shareholders approve the Plan and the appointment
of the three independent members of our Board to serve as trustees of the       
Liquidating Trust. (See "Proposal No. 2" below) Stephen A. Dukker, Kapil K.     
Nanda and William H. Welling will serve as Trustees of the Liquidating Trust.   
The Board has determined that each Trustee shall receive $3,000 for each        
meeting of Trustees which are currently expected to occur at least quarterly,   
up to a maximum of $25,000 per Trustee per year, and an additional $2,500 per   
day of consulting work performed for the Trust. Subject to ratification by the  
Trustees following the establishment of the Trust, it is currently contemplated 
that the fourth member of our Board, Bernard T. Marren, also our President and  
Chief Executive Officer, will be paid an annual fee of $50,000 to oversee the   
routine operations of the Trust and provide consulting services in connection   
with its pursuit of the Infringement Claims.                                    

 Finally, also subject to ratification by the Trustees, Michael Mazzoni, our
Chief Financial Officer, will be paid an annual fee of $10,000 for ongoing work 
involving the preparation of financial statements by the Trust, the work of     
auditors who may be engaged by the Trust, liaison with the law firms engaged by 
the Trust and other ministerial matters as necessary to carry out the purpose   
of the Trust.                                                                   

The Plan was adopted by the unanimous vote of our directors, each of whose
interests in the Plan and the Trust have been set forth herein. It is not       
currently anticipated that the liquidation of OPTi will result in any material  
increase in value of the shares or options held by any directors who            
participated in the vote on the Plan.                                           

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PRINCIPAL PROVISIONS OF THE LIQUIDATION PLAN AND DISSOLUTION  

  We will distribute in cash or in-kind, pro rata to our shareholders, or sell
or otherwise dispose of, or transfer to the Liquidating Trust all our assets,   
including the distribution of the shares of Tripath common stock directly to    
our shareholders on a pro rata basis. The liquidation is expected to commence   
as soon as practicable after approval of the Plan by the shareholders and       
liquidating distributions will be made by OPTi directly to the shareholders and 
to the Liquidating Trust on behalf of the shareholders. Any sales of OPTi's     
assets will be made in private or public transactions and on such terms as are  
approved by our Board of Directors. It is not anticipated that any further      
votes of OPTi's shareholders will be solicited with respect to the approval of  
the specific terms of any particular sales of assets approved by our Board of   
Directors. See "Sales of OPTi's Assets."                                        

Following approval of the Liquidation Plan by the shareholders, a         
Certificate of Election to Wind Up and Dissolve will be filed with the State of 
California initiating the dissolution of OPTi. OPTi currently plans to then set 
aside approximately $5 million in cash or cash equivalent assets. Of this       
amount, approximately $2 million will be reserved to fund the Liquidating       
Trust. Following OPTi's dissolution, these funds will be used to ensure that    
the Trust has adequate resources to pursue the Infringement Claims and to pay   
the costs of operating and administering the trust and to provide for potential 
future claims by creditors.                                                     

The remaining $3 million set aside will be placed in a Contingency Reserve
as reasonable provision for the known and anticipated liabilities, expenses and 
obligations of OPTi as of the Adoption Date. See"LIQUIDATION ANALYSIS AND       
ESTIMATES--Analysis of Funds Available for Liquidating Distributions."          

  OPTi will distribute its remaining cash on hand, together with cash proceeds
from sales of other assets, and all of the shares of Tripath stock held by      
OPTi, to our shareholders on a pro rata basis in one or more liquidating        
distributions.                                                                  

OPTi currently estimates that approximately $700,000 in contingent        
liabilities may still remain outstanding on the Effective Date of Dissolution,  
which amount includes provision for OPTi's remaining lease payments for two     
former office buildings. In addition to the $2 million transferred to fund the  
Trust discussed above an amount of cash necessary to pay all known or           
anticipated contingent liabilities as of the Effective Date of Dissolution will 
be transferred to the Trust from the Contingency Reserve on the Effective Date  
of Dissolution. The net balance, if any, of the Contingency Reserve remaining   
after payment, provision or discharge of all such liabilities, expenses and     
obligations will be distributed to OPTi shareholders as a liquidating           
distribution. No assurances can be given that available cash and amounts        
received from the sale of assets will be adequate to provide for OPTi's         
obligations, liabilities, expenses and claims and to make cash distributions to 
shareholders. In addition, we currently have no plans to repurchase shares of   
common stock from our shareholders. However, if we were to repurchase shares of 
common stock from our shareholders, such repurchases would be open market       
purchases and would decrease amounts distributable to other shareholders if     
OPTi were to pay amounts in excess of the per share values distributable in     
respect of the shares purchased and would increase amounts distributable to     
other shareholders if OPTi were to pay amounts less than the per share values   
distributable in respect of such shares. See "Liquidating Distributions;        
Nature; Amount; Timing" and "Contingent Liabilities; Contingency Reserve; The   
OPTi Inc. Liquidating Trust" and "LIQUIDATION ANALYSIS AND ESTIMATES" below.    

OPTi also plans to transfer its intellectual property, including but not  
limited to the OPTi Patents and pending applications, to the Liquidating Trust, 
which would oversee the pursuit of any Infringement Claims. Interests in the    
Trust will not be transferable; therefore, although the recipients of the       
interests would be treated for tax purposes as having received their pro rata   
share of property transferred to the Liquidating Trust and will thereafter take 
into account for tax purposes their allocable portion of any income,            
deductions, gain or loss realized by the Trust, the recipients of the interests 
will not realize the value thereof unless and until the Liquidating Trust       
distributes cash or other assets to them. The tax consequences of the           
Liquidation Plan are complex. Accordingly, each OPTi shareholder should         
carefully review the Section "UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS"  
set forth below, and discuss the tax considerations with his or her own tax     
advisors. Pursuant to the Liquidation Plan, our Board of Directors has          
appointed three individuals to                                                  

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act as trustees of the Liquidating Trust and will cause OPTi to enter into the  
Liquidating Trust Agreement with the named Trustees on such terms and           
conditions as may be approved by our Board of Directors. Approval of the Plan   
also will authorize OPTi to enter into the Liquidating Trust Agreement and/or   
similar agreements consistent with the purposes of the Liquidation Plan. For    
further information relating to the Liquidating Trust and the Liquidating Trust 
Agreement, reference is made to "The OPTi Inc. Liquidating Trust."              

In addition, we intend to halt trading in OPTi shares in conjunction with 
the filing of a Certificate of Dissolution with the State of California         
according to the following procedure: At the close of business on the business  
day immediately preceding the day that we file the Certificate of Dissolution,  
we will close our stock transfer books and restrict transfers of our common     
stock. On the day that we file the Certificate of Dissolution, the Effective    
Date of Dissolution, the following events will also take place: (i) the Company 
will file a tax clearance certificate or an assumption of tax liability with    
the State of California, (ii) the Company and the Trustees, on behalf of the    
beneficiaries of the Liquidating Trust, will execute the Liquidating Trust      
Agreement; (iii) any property remaining in OPTi will either be distributed in a 
liquidating distribution to OPTi shareholders or will be transferred to the     
Liquidating Trust as the first transfer of property into the Liquidating Trust  
(and will be a deemed distribution to the OPTi shareholders); (iv) beneficial   
interests in the Liquidating Trust will be distributed on a pro rata basis to   
the OPTi shareholders as of the Effective Date of Dissolution; and (v) all      
then-outstanding OPTi shares will be canceled. In no event will the Liquidating 
Trust Agreement be executed nor any property transferred into the Liquidating   
Trust prior to the Effective Date of Dissolution. In no event will any shares   
of OPTi be freely transferable on or after the Effective Date of Dissolution.   
The transfer of the beneficial interests in the Liquidating Trust will also be  
restricted as described further in "The OPTi Inc. Liquidating Trust."           

Abandonment; Amendment                                                          

Under the Liquidation Plan, our Board of Directors may modify, amend or   
abandon the Plan, notwithstanding shareholder approval, to the extent permitted 
by the California Corporations Code. The California Corporations Code does not  
allow the Board to make any change to the Liquidation Plan that would affect    
the distribution ratio set forth in the Liquidation Plan without additional     
shareholder approval of such change. The Liquidation Plan provides for the pro  
rata distribution of all cash proceeds and property distributed directly to the 
shareholders or to the Liquidating Trust on behalf of the shareholders. Under   
the California Corporations Code, the Board is otherwise empowered to do what   
is proper and convenient for purposes of winding up, settling, and liquidating  
the affairs of the company. OPTi will not amend or modify the Plan under        
circumstances that would require additional shareholder solicitations under the 
California Corporations Code or the federal securities laws without complying   
with the California Corporations Code and the federal securities laws. OPTi     
currently has no plans to so amend or abandon the Liquidation Plan.             

Liquidating Distributions; Nature; Amount; Timing                               

Although our Board of Directors has not established a firm timetable for  
distributions to shareholders if the Liquidation Plan is approved by the        
shareholders our Board of Directors intends, subject to contingencies inherent  
in winding up OPTi's business, to make such distributions as promptly as        
practicable. After the approval of the Plan by the shareholders, based upon     
information presently available to us and assuming no unanticipated claims or   
other material adverse events, OPTi believes it will distribute approximately   
$2.00 to $2.35 per share from its net available assets. OPTi will also          
distribute its Tripath shares in kind directly to shareholders on a pro rata    
basis at a ratio of approximately 0.17 Tripath shares for each OPTi share.      

  In addition, OPTi currently expects to transfer the OPTi Patents and related
intellectual property to the Liquidating Trust. See "UNITED STATES FEDERAL      
INCOME TAX CONSIDERATIONS" below.                                               

The proportionate interests of all of the shareholders of OPTi shall be   
fixed on the basis of their respective stock holdings at the close of business  
on record dates set prior to each distribution. On the Effective Date of        
Dissolution, the Company and the Trustees, on behalf of the beneficial holders  
of the Liquidating Trust, will                                                  

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execute the Liquidating Trust Agreement: (i) any property remaining in OPTi     
will either be distributed in a liquidating distribution to OPTi shareholders   
or will be transferred to the Liquidating Trust as the first transfer of        
property into the Liquidating Trust (and will be a deemed distribution to the   
OPTi shareholders); (ii) beneficial interests in the Liquidating Trust will be  
distributed on a pro rata basis to the OPTi shareholders as of the Effective    
Date of Dissolution; and (iii) all then-outstanding OPTi shares will be         
canceled. In no event will the Liquidating Trust Agreement be executed nor any  
property transferred into the Liquidating Trust prior to the Effective Date of  
Dissolution. In no event will any shares of OPTi be freely transferable on or   
after the Effective Date of Dissolution. Our Board of Directors is, however,    
currently unable to predict the precise nature, amount or timing of any         
distributions or of the Effective Date of Dissolution. The actual nature,       
amount and timing of all distributions will be determined by our Board of       
Directors, in its sole discretion, and will depend in part upon our ability to  
convert our remaining assets into cash.                                         

We do not plan to satisfy all of our liabilities and obligations prior to 
commencing distributions to our shareholders, but instead will reserve assets   
deemed by management and our Board of Directors to be adequate to provide for   
such liabilities and obligations. See "Contingent Liabilities; Contingency      
Reserve." Management and our Board of Directors believe that we have sufficient 
cash to pay our current and accrued obligations without the sale of any of our  
other assets.                                                                   

Uncertainties as to the precise net value of our non-cash assets and the  
ultimate amount of our liabilities make it impractical to predict the aggregate 
net value ultimately distributable to shareholders. Claims, liabilities and     
expenses from operations (including operating costs, salaries, income taxes,    
payroll and local taxes, legal and accounting fees and miscellaneous office     
expenses), although currently declining, will continue to be incurred following 
approval of the Plan. These expenses will reduce the amount of assets available 
for ultimate distribution to shareholders and, while OPTi does not believe that 
a precise estimate of those expenses can currently be made, management and our  
Board of Directors believe that available cash and amounts received on the sale 
of assets will be adequate to provide for OPTi's obligations, liabilities,      
expenses and claims (including known contingent liabilities) and to make cash   
distributions to shareholders. However, no assurances can be given that         
available cash and amounts received on the sale of assets will be adequate to   
provide for OPTi's obligations, liabilities, expenses and claims and to make    
cash distributions to shareholders. If such available cash and amounts received 
on the sale of assets are not adequate to provide for OPTi's obligations,       
liabilities, expenses and claims, distributions of cash and other assets to     
OPTi's shareholders will be reduced.                                            

Sales of OPTi's Assets                                                          

The Plan gives our Board of Directors the authority to sell all of the    
assets of OPTi. Sales of OPTi's remaining assets will be made on such terms as  
are approved by our Board of Directors and may be conducted by competitive      
bidding, public sales or privately negotiated sales. Any other types of sales   
will only be made after our Board of Directors has determined that any such     
sale is in the best interests of the shareholders. It is not anticipated that   
any further shareholder votes will be solicited with respect to the approval of 
the specific terms of any particular sales of assets approved by our Board of   
Directors. OPTi does not anticipate amending or supplementing the Proxy         
Statement to reflect any such agreement or sale, unless required by applicable  
law. The prices at which we will be able to sell our various remaining assets   
will depend largely on factors beyond OPTi's control, including, without        
limitation, the condition of financial markets, the availability of financing   
to prospective purchasers of the assets, United States and foreign regulatory   
approvals, public market perceptions and limitations on transferability of      
certain assets.                                                                 

Currently, OPTi has three basic types of assets. As of September 30, 2001,
approximately 92% of our $34.2 million in total assets with book value was held 
in cash, cash equivalents and marketable securities, including 1,914,155 shares 
of Tripath stock. As described above, these readily transferable assets will be 
distributed directly to OPTi shareholders or transferred to the Liquidating     
Trust for the benefit of the shareholders after reasonable provision is made    
for satisfaction of OPTi's known and contingent liabilities.                    

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  Approximately eight percent of OPTi's assets with book value as of September
30, 2001 consisted of accounts receivable, inventories, property, plant and     
equipment and certain lease rights. Those accounts receivables that remain      
uncollected on the Effective Date of Dissolution will be transferred to the     
Liquidating Trust for the benefit of the shareholders. OPTi has begun to search 
for professional liquidators to assist in the sale of any inventory that may    
remain unsold, as well as any no-longer needed property and equipment. OPTi     
expects these items to be sold either in privately negotiated transactions with 
third parties or at public auction. With respect to its leases, OPTi is         
currently seeking sublessees to assume the leases.                              

Finally, we currently expect to transfer OPTi's third group of assets, the
OPTi Patents and the related Infringement Claims to the Liquidating Trust as    
further described in "The OPTi Inc. Liquidating Trust." As of September 30,     
2001, these patents and claims did not have a stated book value in accordance   
with generally accepted accounting principals. OPTi has engaged Standard &      
Poor's to prepare an appraisal of the fair market value of the OPTi Patents and 
the Infringement Claims at the time those properties are transferred to the     
Liquidating Trust.                                                              

Conduct of OPTi Following Adoption of the Plan                                  

 Since the authorization of the Plan by our Board of Directors, our Board of
Directors and management have taken steps to reduce OPTi's operations and, upon 
approval of the Plan by the shareholders, wind up our operations. If our Board  
deems it advisable, certain members of management and any other continuing      
employees may receive compensation for the duties then being performed. Such    
compensation, if any, will be determined by evaluation of all relevant factors, 
including, without limitation, the efforts of such individuals in successfully  
implementing the Plan and a review of compensation payable to individuals       
exercising similar authority and bearing similar responsibilities.              

Following approval of the Plan by OPTi's shareholders, our activities will
be limited to winding up our affairs, taking such action as may be necessary to 
preserve the value of our assets and distributing our assets in accordance with 
the Plan. We will seek to distribute or liquidate all of our assets in such     
manner and upon such terms as our Board of Directors determines to be in the    
best interests of OPTi's shareholders.                                          

  Following the approval of the Plan by OPTi's shareholders, we shall continue
to indemnify our officers, directors, employees and agents in accordance with   
our Articles of Incorporation, as amended, and Bylaws. Such indemnification     
will include actions taken in connection with the Plan and the winding up of    
the affairs of OPTi. OPTi's obligation to indemnify such persons may be         
satisfied out of the assets of the Liquidating Trust. Our Board of Directors    
and the Trustees of the Liquidating Trust may also obtain and or maintain such  
insurance as may be necessary to cover OPTi's indemnification obligations under 
the Plan.                                                                       

Reporting Requirements                                                          

Whether or not the Plan is approved, we have an obligation to continue to 
comply with the applicable reporting requirements of the Securities Exchange    
Act of 1934, as amended, (the "Exchange Act") even though compliance with such  
reporting requirements is economically burdensome. If the Plan is approved, in  
order to curtail expenses we will, after filing a Certificate of Election to    
Wind Up and Dissolve and a Certificate of Dissolution, either seek to complete  
the dissolution of OPTi prior to March 30, 2002, the due date for the filing of 
our next annual report on Form 10-K, or seek relief from the Securities &       
Exchange Commission ("SEC") from the reporting requirements under the Exchange  
Act.                                                                            

Contingent Liabilities; Contingency Reserve                                     

 Under the California Corporations Code, we are required, in connection with
our dissolution, to pay or provide for payment of all of our liabilities and    
obligations. Following approval of the Plan by OPTi's shareholders, OPTi will   
set aside cash and other assets which it believes to be adequate for payment of 
our                                                                             

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liabilities and obligations as a Contingency Reserve. Based upon the amount of  
our known current and contingent liabilities pending completion of the          
dissolution, and an allowance for potential future claims by creditors, OPTi    
currently estimates the amount of the Contingency Reserve which will be set     
aside at approximately $3 million. See "LIQUIDATION ANALYSIS AND                
ESTIMATES--Analysis of Funds Available for Liquidating Distributions." Such     
amount (in addition to the cash contributed to the Liquidating Trust) will be   
deducted before the determination of amounts available for distribution to      
shareholders.                                                                   

The actual amount of the Contingency Reserve will be based upon estimates 
and opinions of management and our Board of Directors and derived from          
consultations with outside experts and review of OPTi's estimated operating     
expenses and future estimated liabilities, including, without limitation,       
anticipated compensation payments, estimated legal and accounting fees,         
operating lease expenses, payroll and other taxes payable, miscellaneous office 
expenses, expenses accrued in OPTi's financial statements and reserves for      
litigation expenses. There can be no assurance that the Contingency Reserve     
will be sufficient. Subsequent to the establishment of the Contingency Reserve, 
we will distribute to our shareholders any portions of the Contingency Reserve  
which we deem no longer to be required. After the liabilities, expenses and     
obligations for which the Contingency Reserve was established have been         
satisfied in full, we will distribute to our shareholders any remaining portion 
of the Contingency Reserve. However, we currently estimate that approximately   
$700,000 in known contingent liabilities may remain outstanding as of the       
Effective Date of Dissolution. The $700,000 includes what is needed to cover    
OPTi's post-dissolution liability under leases for OPTi's two former office     
buildings for restoration charges and, in the absence of a sublease, rent. We   
will transfer the amount of known and potential contingent liabilities as of    
the Effective Date of Dissolution from the Contingency Reserve to the           
Liquidating Trust in addition to the $2 million we expect to transfer to fund   
the Trust.                                                                      

 In addition, we are currently taking steps to minimize our liabilities. Our
accounts payable have been kept current and we do not foresee that any          
significant contingent liabilities will be outstanding when the shareholders    
vote on the Plan. We have been working closely with Ernst & Young LLP, the      
independent accounting firm that has audited our financial statements since our 
inception, on the financial and tax planning aspects of the Liquidation Plan.   

 Under the California Corporations Code, if OPTi fails to create an adequate
Contingency Reserve for payment of its expenses and liabilities, or should the  
Contingency Reserve be exceeded by the amount ultimately found payable in       
respect of expenses and liabilities, each shareholder could be held liable for  
the payment to creditors of such shareholder's pro rata share of such excess,   
limited to the amounts theretofore received by such shareholder from OPTi.      

  If we were held by a court to have failed to make adequate provision for our
expenses and liabilities or if the amount ultimately required to be paid in     
respect of such liabilities exceeded the amount available from the Contingency  
Reserve, a creditor of OPTi could seek an injunction against the making of      
distributions under the Plan on the ground that the amounts to be distributed   
were needed to provide for the payment of OPTi's expenses and liabilities. Any  
such action could delay or substantially diminish the cash distributions to be  
made to shareholders and/or the beneficiaries of the Liquidating Trust under    
the Plan.                                                                       

The OPTi Inc. Liquidating Trust                                                 

  On the Effective Date of Dissolution, we plan to transfer to the Liquidating
Trust the OPTi Patents, other intellectual property and approximately $2        
million in cash to fund pursuit of the claims related to the infringement of    
certain of our patents, to provide for the management and operations of the     
Liquidating Trust, to provide for potential future claims by creditors, to pay  
for necessary statements, filings and disclosures, and to provide for Trust     
distribution expenses. In addition, as discussed above, we will transfer        
additional funds, currently estimated at $700,000, to pay the claims, if any,   
of creditors which have not been asserted or satisfied in full prior to OPTi's  
dissolution.                                                                    

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We expect that a principal activity of the Liquidating Trust will be      
overseeing the pursuit of potential claims against certain third parties for    
infringement of certain of the OPTi Patents. We believe that certain companies  
engaged in the development, manufacture and sale of integrated semiconductor    
chipsets and other companies which sell products within which such chipsets are 
embedded may employ core logic methods and techniques that are covered by our   
patent portfolio. In 1999 we notified two major manufacturers of semiconductor  
devices that we believed they were infringing on certain of our patents. During 
the first quarter of 2000 we announced the signing of a one-time fully paid     
license and release from past and future infringement claims on all of our      
existing and pending patents with one of the manufacturers for payment of $13.3 
million. In June 2000, we entered into a contingency fee agreement with Derwin  
& Siegel LLP, an intellectual property law firm to assist us in pursuing our    
possible claim against the manufacturer of semiconductor devices who had not    
agreed to a settlement and to investigate the possibility of patent             
infringement claims against other companies which may be employing our patented 
technology. Derwin & Siegel specializes in intellectual property issues         
relevant to computer and semiconductor companies. Clients of the firm include   
America OnLine and NEC Electronics. The firm's four partners have over fifty    
cumulative years of experience in high-technology intellectual property law,    
including intellectual property litigation representation of major computer and 
semiconductor clients as AMD, NEC and PeopleSoft. Pursuant to the contingency   
fee agreement, OPTi will only pay for Derwin & Siegel's expenses. If settlement 
is reached after commencement of trial, Derwin & Siegel will receive 30% of the 
total recovery. If settlement is reached prior to commencement of trial, Derwin 
& Siegel will receive a lesser percentage of the total recovery.                

During 2001, we filed for a continuance on one of our key patents with the
U.S. Patent and Trademarks Office. We are awaiting a final written decision on  
our continuance request. We have also recently begun negotiations to settle our 
potential legal claims with a third semiconductor manufacturer who we believe   
may be infringing our patents. We have notified two other manufacturers that we 
believe they are infringing our patents and we are in the process of            
identifying other companies who might be using our patented technologies.       
Derwin & Siegel has advised us that there can be no assurance that the pursuit  
of any of our potential patent infringement claims will be successful.          
Nonetheless, based upon the settlement that we achieved in the first quarter of 
2000, our estimates of the shipments of semiconductor devices that may be       
infringing our patents and its own experience in pursuing such claims, Derwin & 
Siegel has advised us that continuing to pursue recovery for the Infringement   
Claims could result in additional payments for settlements of the Infringement  
Claims.                                                                         

The Board of Directors has therefore determined that it is in the best interest 
of OPTi and our shareholders to pursue our causes of action which are the bases 
for the Infringement Claims. Because of the uncertainty inherent in prosecuting 
the Infringement Claims and because of the impracticality of distributing our   
patents and intellectual property to OPTi's shareholders, the Board of          
Directors has decided to establish the Liquidating Trust to hold the OPTi       
Patents and other intellectual property, as well as other assets, if any, that  
may not be convenient to liquidate in an orderly fashion prior to our           
dissolution.                                                                    

Our Board of Directors believes the flexibility provided by the Plan with 
respect to the Liquidating Trust to be advisable. The Trust will be evidenced   
by a trust agreement between OPTi and the Trustees, (the "Liquidating Trust     
Agreement"). The overall purpose of the Trust will be to serve as a temporary   
repository for the trust property prior to disposition or distribution to       
OPTi's shareholders. The transfer to the Trust and distribution of interests    
therein to OPTi's shareholders would enable us to divest ourselves of the trust 
property and permit OPTi's shareholders to enjoy the economic benefits of       
ownership thereof. Pursuant to the Liquidation Plan, the trust property would   
be transferred to the Trustees to be held in trust for the benefit of the       
shareholder beneficiaries subject to the terms of the Liquidating Trust         
Agreement.                                                                      

The Liquidating Trust Agreement                                                 

On September 7, 2001, in conjunction with its approval of the Liquidation 
Plan, the Board of Directors also approved the form of Liquidating Trust        
Agreement attached hereto as Annex B. The Company and the Trustees, on behalf   
of the beneficiaries of the Liquidating Trust, will execute the Liquidating     
Trust Agreement, substantially in the form attached, on the Effective Date of   
Dissolution.                                                                    

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The Liquidating Trust Agreement provides for the Trustees to carry out the
purposes of the Liquidating Trust discussed above. The principal provisions of  
the Liquidating Trust Agreement are set forth below. Shareholders should read   
the Liquidating Trust Agreement in its entirety. Shareholders should be aware   
that the form of the Liquidating Trust Agreement attached is included in our    
ruling request to the IRS and may therefore be subject to change pending the    
IRS's final determination.                                                      

.  The Liquidating Trust exists solely for the purpose of liquidating   
OPTi's illiquid assets and distributing the proceeds to the       
beneficiaries of the Liquidating Trust.                           

.  The Trust is an irrevocable grantor trust.                           

.  Beneficial interests in the Liquidating Trust shall be distributed to
     OPTi shareholders as of the Effective Date of Dissolution on a pro rata
basis based upon their proportionate holdings of OPTi shares.     

.  The beneficial interest of a beneficiary in the Liquidating Trust may
not be transferred in whole or in part except by will, intestate  
     succession or operation of law or transfers from nominal record holders
to beneficial owners.                                             

  .  The Liquidating Trust shall be administered by three Trustees appointed
   by the OPTi Board of Directors and approved by the OPTi shareholders.

  .  The Trustees shall have full, absolute and exclusive power, control and
     authority over the trust estate and over the affairs of the Liquidating
     Trust to the same extent as if the Trustees were the sole owners of the
      Liquidating Trust, provided that such power, control and authority shall
  only be exercised to such acts as in the Trustees' sole judgment and
      discretion are necessary in, incidental to or desirable for carrying out
the purposes of the Trust.                                        

   .  The Trustees shall maintain records and books of account relating to the
      trust estate in accordance with generally accepted accounting principles
and shall permit any authorized representative designated by any  
beneficiary to have access to the financial records.              

.  The Trustees shall provide the beneficiaries with all necessary tax  
     information and make available to the beneficiaries such annual or more
frequent reports as the Trustees shall determine in their sole    
discretion to comply with the applicable income tax reporting     
regulations.                                                      

.  The cash portion of the Liquidating Trust will only be invested in   
     demand and time deposits in banks or savings institutions, or temporary
    investments such as short-term certificates of deposit, Treasury bills
or money market funds.                                            

.  At least annually, all cash in the Trust, including any proceeds from
 the sale of assets or income from investments, shall be paid by the
Trustees to the Beneficiaries, net of any amounts used to pay     
 liabilities or expenses, or based on the Trustees' determination in
 their sole discretion, reserved to pay liabilities or expenses then
    pending or reasonably anticipated. In addition, the Trustees shall use
      their best efforts to ensure that the value of assets in the Liquidating
   Trust on the last day of any fiscal year does not exceed $10 million.

   .  Any Trustee can be removed at any time, for good cause, by beneficiaries
holding more than 50% of the total beneficial interests in the    
Liquidating Trust.                                                

 The beneficial interests in the Trust will be evidenced only by the records
of the Trust, there will be no certificates or other tangible evidence of such  
interests, and no holder of common stock would be required to pay any cash or   
other consideration for the interests to be received in the distribution or to  
surrender or exchange shares of common stock in order to receive the interests. 
In addition, pursuant to the Liquidating Trust Agreement, the Trust will be     
irrevocable and will terminate after the earliest of (y) the trust property     
having been fully distributed, or (z) three years having elapsed after the      
creation of the Trust. Barring unusual circumstances, IRS rules limit the       
duration of a liquidating trust to three years. We believe that such a          
three-year period will be                                                       

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sufficient for the Trust to either settle the Infringement Claims or dispose of 
them. We have also submitted a request to the IRS that, if ruled upon           
favorably, would enable the Trust to continue for an additional two years if    
circumstances warrant. Although we currently believe that three years should be 
adequate for the Trust to either settle or dispose of the Infringement Claims   
and distribute any proceeds to the beneficiaries of the Trust, delaying tactics 
are common defense strategies in intellectual property litigation. OPTi         
believes that the ability to extend the duration of the Trust beyond three      
years can be useful to discourage potential defendants from seeking to avoid    
the Infringement Claims by delaying resolution until the Trust terminates.      

Regardless of whether the duration of the Trust is three or five years, it
is possible that certain Infringement Claims may not be fully resolved or paid  
when the Trust terminates. This may be due to continuing litigation, ongoing    
settlement negotiations, payments from final settlement agreements or           
litigation awards that remain uncollected, installment payments that are not    
yet due, or other factors that can arise during the pursuit of patent           
infringement claims. In such event, the Trust can realize the value of such     
unresolved Infringement Claims by selling the rights to pursue any then-open    
claims or to collect any then-outstanding payments to third parties for         
lump-sum payments. The Trust would then distribute the proceeds of such         
lump-sum payments to the Trust beneficiaries prior to termination of the Trust. 

The Trustees; Trustee Compensation                                              

The Plan authorizes our Board of Directors to appoint one or more         
individuals or entities to act as trustee or trustees of the liquidating trust  
or trusts and to cause OPTi to enter into liquidating trust agreement or        
agreements with such trustee or trustees on such terms and conditions as may be 
approved by our Board of Directors. Our Board of Directors has selected three   
such trustees, Stephen A. Dukker, Kapil K. Nanda and William H. Welling, the    
three independent members of our Board, on the basis of their experience with   
OPTi and our industry and their ability to serve the best interests of OPTi's   
shareholders.                                                                   

For further information regarding the appointed trustees, see "PROPOSAL   
NUMBER THREE--Election of Directors".                                           

Administration of the Trust                                                     

 The Trustees are responsible for overseeing the administration of the Trust
and will meet periodically (currently expected to be on a quarterly basis) to   
review the status and activities of the Trust. Subject to ratification by the   
Trustees following the establishment of the Trust, it is currently contemplated 
that the fourth member of our Board, Bernard T. Marren, who is also our         
President and Chief Executive Officer, will oversee the routine operations of   
the Trust and provide consulting services in connection with its pursuit of the 
Infringement Claims and be paid an annual fee of $50,000.                       

 In addition, also subject to ratification by the Trustees, Michael Mazzoni,
our Chief Financial Officer, will be paid an annual fee of $10,000 for ongoing  
work involving the preparation of financial statements by the Trust, work with  
auditors who may be engaged by the Trust, liaison with the law firms engaged by 
the Trust and other ministerial matters as necessary to carry out the purpose   
of the Trust. In addition, the Trustees will also engage other professionals,   
including but not limited to attorneys, accountants, investment advisors and    
agents to perform the routine operations of the Trust and they will pay such    
professionals reasonable compensation and disbursement of expenses out of the   
cash being transferred to fund the Liquidating Trust.                           

Effective Date of Dissolution                                                   

On the Effective Date of Dissolution, the following will occur: (i) the   
Company and the Trustees, on behalf of the beneficial holders of the            
Liquidating Trust, will execute the Liquidating Trust Agreement; (ii) any       
property remaining in OPTi will either be distributed in a liquidating          
distribution to OPTi shareholders or will be transferred to the Liquidating     
Trust as the first transfer of property into the Liquidating Trust (and will be 
a                                                                               

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deemed liquidating distribution to the OPTi shareholders); (iii) beneficial     
interests in the Liquidating Trust will be distributed on a pro rata basis to   
the OPTi shareholders as of the Effective Date of Dissolution; and (iv) all     
then-outstanding OPTi shares will be canceled. In no event will the Liquidating 
Trust Agreement be executed nor any property transferred into the Liquidating   
Trust prior to the Effective Date of Dissolution. In no event will any shares   
of OPTi be freely transferable on or after the Effective Date of Dissolution.   
OPTi shareholders should not forward their stock certificates unless receiving  
instructions to do so. If surrender of stock certificates should be required,   
all distributions otherwise payable by OPTi or the Liquidating Trust, if any,   
to shareholders who have not surrendered their stock certificates, may be held  
in trust for such shareholders, without interest, until the surrender of their  
certificates (subject to applicable laws relating to abandoned property). If a  
shareholder's certificate evidencing the common stock has been lost, stolen or  
destroyed, the shareholder may be required to furnish OPTi with satisfactory    
evidence of the loss, theft or destruction thereof, together with a surety bond 
or other indemnity, as a condition to the receipt of any distribution.          

Listing and Trading of the OPTi Common Stock and the Beneficial Interests in    
the Liquidating Trust                                                           

Our Common Stock is currently listed for trading on the Nasdaq National   
Market. We currently expect that our Common Stock will continue to trade on     
Nasdaq prior to the Effective Date of Dissolution, as long as we continue to    
meet their listing requirements. Of the Nasdaq requirements for continued       
listing, we believe that our ability to meet the following criteria will        
determine how long our shares continue to trade on the Nasdaq National Market:  

.  Our stockholders' equity must equal or exceed $10 million or our net 
tangible assets must equal or exceed $4 million; and              

   .  The minimum daily per share bid price for our stock must equal or exceed
$1.                                                               

With respect to the net tangible asset requirement, we currently expect to
retain the $2 million in cash that we will use to fund the Liquidating Trust    
until our final liquidating distribution prior to dissolution. We also expect   
to place approximately $3 million in our Contingency Reserve to provide for our 
liabilities prior to dissolution. At this time we can give no assurance as to   
the timing of payments to creditors from our Contingency Reserve. Consequently, 
at this time we can also give no assurance as to the length of time that our    
net tangible assets will continue to meet the Nasdaq listing requirement once   
we commence our liquidating distributions.                                      

 With respect to the minimum bid price requirement, as of December 10, 2001,
the closing sale price for our shares was $3.02. We expect that our initial     
liquidating distribution will take place in January or February 2002 and OPTi   
shareholders will receive from $2.00 to $2.35 per share in cash and             
approximately 0.17 shares of Tripath stock per share of OPTi stock. The closing 
sale price of Tripath stock on December 10, 2001 was $1.78 per share. If we     
fail to meet Nasdaq's minimum bid price criterion for 30 consecutive business   
days, Nasdaq will notify us that we are not meeting the requirement. We will    
then be given a 90 day grace period during which our shares must exceed the     
minimum bid price for at least ten consecutive trading days for us to avoid     
being delisted at the end of the grace period.                                  

Each of the above listing criteria has been the subject of recent Nasdaq  
rulemaking action. However, OPTi does not currently expect the recent Nasdaq    
rule changes to affect the length of time that its shares will remain listed.   
In May 2001, Nasdaq changed the $4 million minimum net tangible asset           
requirement to a $10 million minimum stockholders' equity requirement. However, 
companies such as OPTi that were listed on Nasdaq as of June 29, 2001 may       
qualify for continued listing under either criteria until the old net tangible  
asset requirement expires on November 1, 2002. As we currently expect to have   
completed our liquidation and filed a Certificate of Dissolution in the first   
half of 2002, we do not believe that the expiration of the net tangible asset   
requirement will affect the listing of our shares on the Nasdaq National Market.

In September 2001, Nasdaq temporarily suspended the minimum bid price     
listing criterion until January 2, 2002. As we currently expect to make an      
initial liquidating distribution of $2.00 to $2.35 per share in January or      

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February 2002, we do not expect the suspension of the minimum bid price         
criterion will affect the continued listing of our shares on the Nasdaq         
National Market.                                                                

If our shares are delisted, trading, if any, in the Common Stock would    
thereafter be conducted in the over-the-counter market in the so-called "pink   
sheets" or the NASD's "Electronic Bulletin Board." As a consequence of such     
delisting, an investor would likely find it more difficult to dispose of, or to 
obtain quotations as to, the price of the common stock. Delisting of the common 
stock may result in lower prices for the common stock than would otherwise      
prevail. In any event, we will close our stock transfer books at the close of   
business on the business day immediately preceding the Effective Date of        
Dissolution. Thereafter, the shareholders will not be able to transfer their    
shares and all OPTi shares will be canceled on the Effective Date of            
Dissolution and all beneficial interests in the Liquidating Trust will be       
distributed on a pro rata basis to the OPTi shareholders.                       

Shareholders who are considering the sale of their stock should be aware  
that only persons who hold OPTi shares at the time of each liquidating          
distribution will receive that distribution. In addition, only shareholders who 
continue to hold their shares until the Effective Date of Dissolution will be   
entitled to receive pro rata beneficial interests in the Liquidating Trust and  
any subsequent distributions made from the Liquidating Trust to its             
beneficiaries. If the shareholders approve the Liquidation Plan, the dates of   
each liquidating distribution and the Effective Date of Dissolution will be     
announced by OPTi as they are determined by OPTi's Board of Directors.          

For tax purposes, all shareholders as of the Effective Date of Dissolution
will be deemed to have received a liquidating distribution equal to their pro   
rata share of the value of the assets transferred to the Liquidating Trust.     
That deemed distribution could result in tax liability for the shareholders     
whether or not the shareholders have received any actual distributions from the 
Trust that would provide funds with which to pay such tax. See "UNITED STATES   
FEDERAL INCOME TAX CONSIDERATIONS".                                             

 The beneficial interests in the Liquidating Trust may not be transferred in
whole or in part except by will, intestate succession or operation of law or    
transfers from nominee record holders to beneficial owners, and any attempted   
transfer shall be of no force and effect as between the Trustees and the        
interest holder attempting such transfer.                                       

Absence of Appraisal Rights                                                     

Under the California Corporations Code, the shareholders of OPTi are not  
entitled to appraisal rights for their shares of common stock in connection     
with the transactions contemplated by the Plan.                                 

Regulatory Approvals                                                            

No United States federal or state regulatory requirements must be complied
with or approvals obtained in connection with the dissolution.                  

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UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS 

The following summary of the material United States federal income tax    
consequences affecting OPTi and OPTi shareholders that are anticipated to       
result from the liquidation and dissolution of OPTi is based upon the Internal  
Revenue Code of 1986, as amended (the "Code"), Treasury Regulations, Internal   
Revenue Service ("IRS") rulings, and judicial decisions now in effect, all of   
which are subject to change at any time (any such changes may be applied        
retroactively). This discussion does not purport to be a complete analysis of   
all the potential tax effects of the liquidation and dissolution of OPTi.       
Moreover, this discussion does not address the tax consequences that may be     
relevant to particular categories of investors subject to special treatment     
under certain federal income tax laws (such as dealers in securities, banks,    
insurance companies, tax-exempt organizations, mutual funds, foreign            
individuals and entities, persons who acquired OPTi shares as compensation, and 
persons who hold OPTi shares subject to hedging, straddle, conversion or        
constructive sale transactions) and does not address any tax consequences       
arising under the laws of any state, local or foreign jurisdiction.             
Distributions pursuant to the Plan may occur at various times. No assurance can 
be given that the tax treatment described herein will remain unchanged at the   
time of such distributions. The discussion below assumes that the Liquidating   
Trust will be treated as a grantor trust for federal income tax purposes.       
However, even if the IRS determines that the Liquidating Trust should be        
treated for federal income tax purposes as a partnership the rules discussed    
below will apply unless otherwise indicated.                                    

THE TAX CONSEQUENCES OF THE LIQUIDATION ARE COMPLEX. ACCORDINGLY, EACH    
HOLDER OF OPTi SHARES IS URGED TO CONSULT WITH HIS OR HER OWN TAX ADVISORS WITH 
RESPECT TO THE FEDERAL INCOME TAX CONSEQUENCES, AS WELL AS ANY ESTATE, GIFT,    
STATE, LOCAL OR FOREIGN TAX CONSEQUENCES, OF THE LIQUIDATION.                   

  For federal income tax purposes, assets held by the Liquidating Trust should
be treated as if they had first been distributed by OPTi to our shareholders    
pro rata to their shareholdings and then contributed by our shareholders to the 
Liquidating Trust. Accordingly, the summary below occasionally refers to a      
distribution to our shareholders of the patents held by the Liquidating Trust   
and a contribution by our shareholders to the Liquidating Trust.                

OPTi has requested that the IRS issue a ruling as to certain of the tax   
consequences discussed below. If the IRS rules favorably as to some or all of   
those matters, OPTi and OPTi's shareholders will be entitled to rely on those   
rulings and can be assured of having the tax treatment described below as to    
those matters (assuming that OPTi liquidates in accordance with the Plan in all 
material respects). If the IRS does not rule favorably as to any matter         
presented in OPTi's ruling request, or if the liquidation is not effected in    
accordance with the Plan in all material respects, then the following           
discussion has no binding effect on the courts or the IRS. If any of the        
anticipated tax consequences described herein proves to be incorrect, the       
result could be increased taxation at the corporate and/or shareholder level,   
thus reducing the benefit to the shareholders and OPTi from the liquidation and 
dissolution.                                                                    

IRS Ruling Request                                                              

 OPTi has requested that the IRS issue a ruling regarding the following U.S.
federal income tax consequences of OPTi's proposed liquidation and dissolution: 
(1) OPTi's actual and deemed distributions to its shareholders will be treated  
as a series of distributions in complete liquidation of OPTi and will be        
treated as received by OPTi shareholders in full payment in exchange for their  
OPTi shares, (2) OPTi shareholders will recognize gain or loss upon their       
actual and deemed receipt of the liquidating distributions, (3) OPTi will       
recognize gain or loss on the distribution of its property in complete          
liquidation as if OPTi had sold that property at its fair market value, (4)     
OPTi's shareholders will not recognize any gain or loss upon their deemed       
contribution of property to the Liquidating Trust and (5) the Liquidating Trust 
will be treated as a liquidating trust.                                         

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OPTi also requested that the IRS rule that the patents and other          
intellectual property transferred to the Trust could not be valued with any     
certainty so that with respect to those assets OPTi shareholders would          
recognize gain only as the Trust received payments. OPTi withdrew that request  
after the IRS indicated it would rule unfavorably on it. Under published IRS    
policy, if a taxpayer withdraws a ruling request with respect to a transaction  
that is completed after the request is withdrawn, the IRS's National Office     
generally will notify the appropriate IRS official in the IRS's operating       
division that has examination jurisdiction of the taxpayer's tax return and may 
also give its views on the issues in the request to that IRS official to        
consider in any later examination of the tax return.                            

Federal Income Taxation of OPTi                                                 

After the approval of the Plan and until the dissolution is completed, we 
will continue to be subject to federal income tax on our taxable income, if     
any. We will recognize gain or loss on sales of our assets pursuant to the      
Plan. Upon the distribution of any property, other than cash, to shareholders   
or to the Liquidating Trust pursuant to the Plan, we will recognize gain or     
loss as if such property had been sold to the shareholders at its fair market   
value, unless certain exceptions to the recognition of loss apply. OPTi has     
engaged Standard & Poor's to place a fair market value on the OPTi Patents and  
the Infringement Claims. No assurance can be given, however, that the IRS or a  
court would agree with that determination of the fair market value of those     
assets.                                                                         

Federal Income Taxation of OPTi's Shareholders                                  

If the IRS rules favorably on our request that the actual and deemed      
distributions by OPTi to our shareholders will be treated as a series of        
distributions in complete liquidation of OPTi and as received by our            
shareholders in full payment in exchange for their OPTi shares, then the        
liquidation of OPTi and the actual and deemed distributions to our shareholders 
in cancellation of all of OPTi's outstanding stock will constitute a "complete  
liquidation" of OPTi under the Code. As a result of the liquidation and         
dissolution of OPTi, for federal income tax purposes an OPTi shareholder will   
recognize gain or loss equal to the difference between (i) the sum of the       
amount of cash distributed to him or her (including cash distributed in lieu of 
a fractional share of Tripath stock) and the fair market value (at the time of  
distribution) of any property distributed to him or her (including the          
shareholder's proportionate share of the assets transferred to the Liquidating  
Trust), and (ii) the tax basis for his or her shares of the Common Stock. A     
shareholder's tax basis in OPTi shares will depend upon various factors,        
including the shareholder's cost and the amount and nature of any distributions 
received with respect thereto.                                                  

A shareholder's gain or loss will be computed on a "per share" basis. OPTi
expects to make more than one liquidating distribution. Each liquidating        
distribution must be allocated proportionately to each share of stock owned by  
a shareholder. The value of each liquidating distribution will be applied       
against and reduce a shareholder's tax basis in his or her shares of stock.     
Gain will be recognized as a result of a liquidating distribution to the extent 
that the aggregate value of the distribution and prior liquidating              
distributions received by a shareholder with respect to a share exceeds the     
shareholder's tax basis for that share. Any loss will generally be recognized   
only when the final distribution from OPTi has been received and then only if   
the aggregate value of all liquidating distributions with respect to a share is 
less than the shareholder's tax basis for that share.                           

Gain or loss recognized by a shareholder will be capital gain or loss provided  
the shares are held as capital assets; whether such capital gain or loss is     
short- or long-term capital gain or loss will depend upon a shareholder's       
holding period for the shares. Gain resulting from the receipt of cash or       
assets from a corporation pursuant to a plan of dissolution is, therefore,      
usually capital gain rather than ordinary income. If it were determined that    
distributions made pursuant to the Plan were not liquidating distributions, the 
result could be treatment of distributions as dividends taxable at ordinary     
income rates (which are currently higher than capital gain rates).              

Upon any distribution of property, the shareholder's tax basis in such    
property immediately after the distribution will be the fair market value of    
such property at the time of distribution. The gain or loss realized            

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upon the shareholder's future sale of that property will be measured by the     
difference between the shareholder's tax basis in the property at the time of   
such sale and the proceeds of such sale.                                        

After the close of our taxable year, we will provide shareholders and the 
IRS with a statement of the amount of cash distributed to the shareholders and  
our best estimate as to the value of any property distributed to them during    
that year. There is no assurance that the IRS will not challenge such           
valuation. As a result of such a challenge, the amount of gain or loss          
recognized by shareholders might be changed. Distributions of property other    
than cash to shareholders could result in tax liability to any given            
shareholder exceeding the amount of cash received, requiring the shareholder to 
meet the tax obligations from other sources or by selling all or a portion of   
the assets received.                                                            

It is possible that we will have liabilities not fully covered by our     
Contingency Reserve for which the shareholders will be liable up to the extent  
of any liquidating distributions they have received. See "PRINCIPAL PROVISIONS  
OF THE LIQUIDATION PLAN AND DISSOLUTION: Contingent Liabilities; Contingency    
Reserve." Such a liability could require a shareholder to satisfy a portion of  
such liability out of prior liquidating distributions to shareholders directly  
or to the Liquidating Trust on their behalf. Payments by shareholders or the    
Liquidating Trust in satisfaction of such liabilities would commonly produce a  
capital loss, the deductibility of which is limited. Moreover, the capital      
losses of individual shareholders could not be carried back to prior years to   
offset capital gains realized from liquidating distributions in those years.    

Material Federal Income Tax Consequences Arising from Liquidating Trusts        

The Liquidating Trust is structured so that with respect to property and  
liabilities transferred to the Liquidating Trust, shareholders will be treated  
for federal income tax purposes as having actually received their pro rata      
share of said property, reduced by the amount of known liabilities assumed by   
the Liquidating Trust, and then transferring those assets (subject to those     
liabilities) to the Liquidating Trust. Assuming such treatment is achieved, a   
transfer of assets to the Liquidating Trust will cause the shareholder to be    
treated in the same manner for federal income tax purposes as if the            
shareholder had received a distribution directly from OPTi. The Liquidating     
Trust should not be subject to federal income tax, assuming that it is treated  
as a liquidating trust for federal income tax purposes. Unless the IRS          
favorably rules on the status of the Liquidating Trust, however, there can be   
no assurance that the Liquidating Trust will be treated as a liquidating trust  
for federal income tax purposes. The IRS has informally indicated that it might 
be more appropriate for the Liquidating Trust to be treated as a partnership    
for federal income tax purposes and that due to the nontransferability of the   
Beneficiaries' interests the partnership would not be treated as a publicly     
traded partnership taxable as a corporation. In the case of partnership         
treatment, the Liquidating Trust itself would still not be subject to tax and   
OPTi would still have been liquidated.                                          

 Shareholders as Beneficiaries of the Liquidating Trust will be taxable each
year on their proportionate shares of the income, gain, loss, and deductions of 
the Liquidating Trust for such year, whether or not distributed. The taxable    
income of the Liquidating Trust will include any gain or loss recognized by it  
on disposition of an asset in the Liquidating Trust, which gain or loss will be 
measured by the difference between the fair market value of the asset when it   
is transferred to the Liquidating Trust and the amount realized by the          
Liquidating Trust when it disposes of the asset. Such income will have the same 
character (e.g., capital gain or ordinary income) as in the hands of the        
Liquidating Trust. If the Liquidating Trust is treated as a partnership for     
federal income tax purposes, then shareholders may have additional gain or loss 
upon the dissolution of the Liquidating Trust. An individual shareholder who    
itemizes deductions would be entitled to deduct his or her pro rata share of    
fees and expenses of the Liquidating Trust only to the extent that such amount, 
together with the shareholder's other miscellaneous deductions, exceeded 2% of  
adjusted gross income. Shareholders should be aware that they may be subject to 
tax, whether or not they have received any actual distributions from the        
Liquidating Trust with which to pay such tax.                                   

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Taxation of Exempt and Non-United States Shareholders                           

 Our shareholders would be treated as directly engaging in the operations of
the Liquidating Trust. Shareholders that are tax-exempt entities may realize    
"unrelated business taxable income" with respect to the Liquidating Trust's     
activities and foreign investors may be considered to receive income that is    
"effectively connected" with a U.S. trade or business. A full discussion of the 
consequences to tax-exempt and foreign shareholders of owning an interest in    
the Liquidating Trust is beyond the scope of this discussion and any such       
shareholder should consult the shareholder's own tax advisors.                  

State and Local Tax                                                             

 We may be subject to liability for state or local taxes with respect to the
sale of our assets. Shareholders may also be subject to state or local taxes,   
including with respect to liquidating distributions received by them or         
transferred to the Liquidating Trust on their behalf, and with respect to any   
income derived by the Liquidating Trust. A shareholder may be subject to tax in 
each state in which the Liquidating Trust owns property or in which a licensee  
of property owned by the Liquidating Trust does business, even if the           
shareholder does not reside in that state. Shareholders should consult their    
tax advisors with respect to the state and local tax consequences of the Plan.  

 THE FOREGOING SUMMARY OF UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS IS
INCLUDED FOR GENERAL INFORMATION ONLY AND DOES NOT CONSTITUTE LEGAL ADVICE TO   
ANY SHAREHOLDER. THE TAX CONSEQUENCES OF THE PLAN MAY VARY DEPENDING UPON THE   
PARTICULAR CIRCUMSTANCES OF THE SHAREHOLDER. OPTi RECOMMENDS THAT EACH          
SHAREHOLDER CONSULT HIS OR HER OWN TAX ADVISORS REGARDING THE FEDERAL INCOME    
TAX CONSEQUENCES OF THE PLAN AS WELL AS THE STATE, LOCAL AND FOREIGN TAX        
CONSEQUENCES.                                                                   

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LIQUIDATION ANALYSIS AND ESTIMATES  

If our shareholders approve the Liquidation Plan, our Board of Directors  
will determine, in their sole discretion and in accordance with applicable      
laws, the timing of, the amount, the kind of and the dates for all              
distributions made to shareholders. Although our Board of Directors has not     
established a firm timetable for distributions to shareholders, after approval  
of the Liquidation Plan, our Board will, subject to exigencies inherent in      
winding up our business, make such distributions as promptly as practicable. We 
currently anticipate that our Board will set a date for the first distribution  
of liquidation proceeds in January or February 2002 with most of the remaining  
liquidation proceeds distributed over a period of one to four months. In the    
absence of known claims or liabilities or possible claims or liabilities which  
we view as likely, we anticipate distributing our available cash at the time of 
distribution, less a reasonable reserve for claims, liabilities and similar     
contingencies, the Contingency Reserve, and less the cash reserved for the      
Liquidating Trust.                                                              

Because of the uncertainties as to the precise net realizable value of our
assets and the ultimate amount of our liabilities, it is impossible to predict  
with certainty the aggregate net values which will ultimately be distributed to 
shareholders or the exact timing of distributions. Based upon information       
presently available to us and assuming no unanticipated claims or other         
material adverse events, we believe our shareholders are likely to receive from 
$2.00 to $2.35 per share from the initial distribution of net available assets. 
Additional distributions could occur during the next one to four months. We are 
unable to estimate the amounts of those distributions at this time. Our         
estimate of our initial liquidating distribution is based on adjusting the      
available cash and marketable securities as of September 30, 2001, as follows:  

 .  Projected increases in available cash and marketable securities due to the
receipt of monies from (i) estimated proceeds from the sale of assets;
   (ii) estimated cash based revenues and interest income from September 30,
 2001 to the date of the distribution; (iii) the exercise of outstanding
vested "in the money" options by employees and officers; and (iv) the 
estimated net realizable value of our non-cash assets.                

.  Projected decreases in available cash due to payment or reservation of   
 monies for (i) estimated expenses relating to operations from September
30, 2001 to the date of the distribution; (ii) accounts payable and   
   accrued liabilities as of September 30, 2001; (iii) estimated amounts due
employees or officers under retention and severance arrangements; (iv)
  costs and expenses associated with completion of the sale of our assets,
    including necessary legal and professional service costs; (v) estimates of
costs related to discontinuing long-term lease arrangements; and (vi) 
   estimates of costs for securing continuing director and officer liability
insurance.                                                            

.  The establishment of an appropriate Contingency Reserve to ensure all    
future liabilities of OPTi may be met.                                

.  The establishment of a Liquidating Trust with adequate funds to operate  
the Trust.                                                            

  In addition to the estimated amount of the initial liquidating distribution,
we also expect to distribute the Tripath stock in conjunction with the initial  
distribution. We will distribute the 1,914,155 shares of Tripath in kind to our 
shareholders on a pro rata basis. As of December 10, 2001, the closing sale     
price for Tripath stock was $3.02 per share. Over the previous twelve months,   
the price of Tripath common stock has ranged from $0.51 to $28.25 per share. As 
of October 19, 2001, Tripath reported that 27,210,658 shares of its common      
stock were outstanding. The distribution of Tripath shares will be treated as a 
distribution in liquidation to OPTi shareholders as further described in        
"UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS."                              

OPTi shareholders who are entitled to receive fractional shares of Tripath
common stock will receive a cash payment for the value of the fractional shares 
of Tripath stock. OPTi will aggregate the number of fractional shares and sell  
that aggregate amount into the public market in order to raise the funds        
necessary. OPTi will therefore incur some additional expenses due to the added  
administrative cost and sales commissions involved in the sale of such Tripath  
shares and the costs of administering the cash payments but the source of the   
cash payments will be the Tripath shares themselves. Therefore OPTi does not    
expect the settlement of the fractional shares will have a material effect on   
the size of the initial and subsequent liquidating distributions to OPTi        
shareholders.                                                                   

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Analysis of Funds Available for Liquidating Distributions                       

As of November 30, 2001, our analysis of the funds and other assets       
available for liquidating distributions directly to our shareholders or for     
transfer to the Liquidating Trust on their behalf was based on the following    
unaudited estimates:                                                            

                                                        [Enlarge/Download Table]

                                                                    Balance    Value to  
Assets                                                               Sheet   Shareholders
------                                                              -------  ------------
                                                                    (Amounts in Millions)
                                                                    ---------------------
                                                                                         
Cash and cash equivalents.......................................... $22.75      $22.75   
Marketable securities(1)...........................................  12.11       12.11   
Accounts receivable................................................   0.31        0.31   
Inventories........................................................   0.27        0.27   
Other current assets...............................................   0.43        0.33   
Property, Plant & Equip.(2)........................................   0.05        0.01   
Other assets(3)....................................................   0.28        0.28   
                                                                    ------      ------   
Total Assets(4).................................................... $36.20      $36.06   
                                                                    ======      ======   

--------                                                                        
(1) Consists of market value of Tripath shares and holdings in U.S. Government  
Bonds fund.                                                             
(2) Value to shareholders is decreased due to certain facilities improvements   
that OPTi believes will have no liquidation value.                      
(3) Available to shareholders upon sublease of OPTi building.                   
(4) As of November 30, 2001, the OPTi patents did not carry a book value in     
  accordance with generally accepted accounting principals. OPTi has engaged
 Standard & Poor's to prepare an appraisal of the fair market value on the
 OPTi patents and the Infringement Claims at the time those properties are
transferred to the Liquidating Trust.                                   

                                                        [Enlarge/Download Table]

                                                                    Balance    Value to  
Liabilities                                                          Sheet   Shareholders
-----------                                                         -------  ------------
                                                                    (Amounts in Millions)
                                                                    ---------------------
                                                                                         
Accounts payable................................................... $ 0.38      $ 0.38   
Other current liabilities(5).......................................   1.00        1.00   
Contingent liabilities(6)..........................................     --        1.10   
                                                                    ------      ------   
Total Liabilities.................................................. $ 1.38      $ 2.48   
                                                                    ======      ======   
Net Value to Shareholders.......................................... $34.82      $33.58   
                                                                    ======      ======   

--------                                                                        
(5) Includes accrued legal and other professional services fees, accrued rent,  
vacation and severance.                                                 
(6) Accounts for potential lease obligations, severance payments and other      
contingent and provision for assertion of currently unknown liabilities.

Of the net value to shareholders, OPTi expects to distribute approximately
$23.36 million in its initial liquidating distribution of cash to OPTi          
shareholders plus approximately $3.41 million in the value of the Tripath       
shares, as of December 10, to be distributed in kind. OPTi has reserved $3.0    
million for its Contingency Reserve and $2.0 million for transfer to the        
Liquidating Trust on the Effective Date of Dissolution to fund the Trust's      
activities. OPTi currently expects to operate on a cash-neutral basis through   
the Effective Date of Dissolution, provided that the Effective Date of          
Dissolution occurs in the first half of 2002 as currently planned.              

In addition, OPTi plans to transfer to the Liquidating Trust the OPTi     
Patents, the Infringement Claims, related intellectual property and any other   
property that has not been liquidated and distributed by OPTi immediately prior 
to or on the Effective Date of Dissolution. OPTi shareholders on the date of    
such transfer will be deemed to have received a liquidating distribution of     
assets on that date. No assurance can be given, however,                        

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that the IRS or a court would agree with that determination of fair value of    
those assets. See "UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS."            

We will update this information as promptly as practicable as additional  
information becomes available to us.                                            

 THE METHODS USED BY OUR BOARD OF DIRECTORS AND MANAGEMENT IN ESTIMATING THE
VALUES OF OPTi'S ASSETS ARE INEXACT AND MAY NOT APPROXIMATE AMOUNTS ACTUALLY    
REALIZED. OUR BOARD OF DIRECTORS' ASSESSMENT ASSUMES THAT THE ESTIMATES OF      
OPTi'S LIABILITIES AND OPERATING COSTS ARE ACCURATE, BUT THOSE ESTIMATES ARE    
SUBJECT TO NUMEROUS UNCERTAINTIES BEYOND OPTi's CONTROL AND ALSO DO NOT REFLECT 
ANY UNANTICIPATED CONTINGENT LIABILITIES THAT MAY MATERIALIZE. FOR ALL THESE    
REASONS, THERE CAN BE NO ASSURANCE THAT THE ACTUAL NET PROCEEDS DISTRIBUTED TO  
SHAREHOLDERS IN DISSOLUTION MAY NOT BE SIGNIFICANTLY LESS THAN THE ESTIMATED    
AMOUNT SHOWN. MOREOVER, NO ASSURANCE CAN BE GIVEN THAT ANY AMOUNTS TO BE        
RECEIVED BY OPTi's SHAREHOLDERS IN DISSOLUTION WILL EQUAL OR EXCEED THE PRICE   
OR PRICES AT WHICH THE COMMON STOCK HAS RECENTLY TRADED OR MAY TRADE IN THE     
FUTURE.                                                                         

VOTE REQUIRED AND BOARD RECOMMENDATION  

The approval of the Liquidation Plan requires the affirmative vote of the 
holders of a majority of the outstanding shares of Common Stock as of the       
Annual Meeting Record Date. Members of our Board of Directors and the executive 
officers of OPTi who hold (or are deemed to hold) an aggregate of 251,165       
shares of common stock (approximately 2.16% of the outstanding shares of common 
stock as of November 30, 2001) have indicated that they will vote in favor of   
the proposal.                                                                   

OUR BOARD BELIEVES THAT THE LIQUIDATION PLAN IS IN THE BEST INTERESTS OF  
OPTi's SHAREHOLDERS AND RECOMMENDS A VOTE FOR THIS PROPOSAL. IT IS INTENDED     
THAT SHARES REPRESENTED BY THE ENCLOSED FORM OF PROXY WILL BE VOTED IN FAVOR OF 
THIS PROPOSAL UNLESS OTHERWISE SPECIFIED IN SUCH PROXY.                         

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PROPOSAL NUMBER 2 

APPOINTMENT OF TRUSTEES 

Approval of Appointment of Trustees                                             
  The Board of Directors of the Company has appointed Stephen A. Dukker, Kapil
K. Nanda and William H. Welling to serve as the initial Trustees of the         
Liquidating Trust, subject to shareholder approval of the dissolution of the    
Company, establishment of the Liquidating Trust and approval of appointment of  
the Trustees. Proposal No. 2 is approval of the appointment of the three        
Trustees at the Annual Meeting. Unless otherwise instructed, the proxy holders  
will vote the proxies received by them in favor of approval of such             
appointment. The term of office of each person appointed as a Trustee will      
continue until the Liquidating Trust is terminated as described in Proposal No. 
1 above or until such Trustee resigns or is removed by the vote of a majority   
of the beneficiaries of the Liquidating Trust. See "PRINCIPLE PROVISIONS OF THE 
LIQUIDATION PLAN AND DISSOLUTION--The Liquidating Trust Agreement; The          
Trustees; Trustee Compensation"                                                 

NOMINEE BIOGRAPHICAL INFORMATION  

The Trustees of the Liquidating Trust were chosen for their experience and
ability to assist in the principal activity of the Liquidating Trust, which we  
expect to be to monitor and evaluate the pursuit of the Infringement Claims by  
outside counsel on behalf of the beneficiaries of the Trust. The Trustees were  
therefore selected for their experience and expertise in the semiconductor      
manufacturing industry, including their familiarity with OPTi's business and    
the businesses of potential targets of the Infringement Claims.                 

Stephen A. Dukker has special knowledge of OPTi's technology and patents  
based on his experience as President of the Company and in the industry in      
general. Mr. Dukker will be able to apply his technical expertise to assist the 
outside patent counsel in the pursuit of the Infringement Claims and assess the 
efficacy of their efforts. He can also help identify others in the industry who 
have expertise that can be beneficial to the outside counsel in the pursuit of  
claims.                                                                         

Kapil K. Nanda was educated and trained as an engineer and has experience 
working in semiconductor manufacturing and design, OPTi's principal business,   
and with the personal computer manufacturers who are among the end users of     
OPTi products. As a result of that experience, Mr. Nanda has special industry   
knowledge to help evaluate the effectiveness of the Trust's pursuit of the      
potential Infringement Claims.                                                  

William H. Welling has experience as the managing partner of an investment
firm. This experience allows Mr. Welling to provide financial expertise to the  
Trust.                                                                          

In addition, each of the nominated Trustees has served as an independent  
director of OPTi over the past several years. Each is therefore familiar with   
the nature of OPTi's business and the business of other semiconductor           
manufacturing companies who may be the target of the Infringement Claims.       

  Also see "ELECTION OF DIRECTORS--BOARD OF DIRECTORS AND NOMINEE BIOGRAPHICAL
INFORMATION"                                                                    

TRUSTEE COMPENSATION  

Our Board has determined that each Trustee shall receive $3,000 for each  
meeting of Trustees, which are currently expected to occur at least quarterly   
up to a maximum of $25,000 annually per Trustee, and an additional $2,500 per   
day of consulting work, if any, performed for the Trust. The individuals named  
to serve as                                                                     

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Trustees are also three of the four members of our Board which unanimously      
approved this compensation arrangement. The amount of compensation received     
annually by the Trustees is intended to be comparable to the compensation they  
receive as independent Directors of OPTi, and is adjusted commensurate with     
their greater responsibilities as Trustees for management of the Trust. Each of 
the three Trustees has also been nominated for re-election to our Board at this 
Annual Meeting.                                                                 

Vote Required                                                                   
The affirmative vote of a majority of the Votes Cast will be required to  
ratify the appointment of Stephen A. Dukker, Kapil K. Nanda and William H.      
Welling to serve as the initial Trustees of the Liquidating Trust.              

OUR BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" APPROVAL OF  
THE APPOINTMENT OF THE TRUSTEES.  

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PROPOSAL NUMBER 3 

ELECTION OF DIRECTORS 

Directors and Nominees for Directors                                            

A board of four directors is to be elected at the Annual Meeting. Unless  
otherwise instructed, the proxy holders will vote the proxies received by them  
for the Company's four nominees named below, all of whom are presently          
directors of the Company. In the event that any nominee of the Company is       
unable or declines to serve as a director at the time of the Annual Meeting,    
the proxies will be voted for any nominee who shall be designated by the        
present Board of Directors to fill the vacancy. In the event that additional    
persons are nominated for election as directors, the proxy holders intend to    
vote all proxies received by them in such a manner in accordance with           
cumulative voting as will assure the election of as many of the nominees listed 
below as possible, and, in such event, the specific nominees to be voted for    
will be determined by the proxy holders. The Company is not aware of any        
nominee who will be unable or will decline to serve as a director. The term of  
office of each person elected as a director will continue until the earliest of 
(i) our next Annual Meeting of Shareholders; (ii) a successor has been duly     
elected and qualified; or (iii) we complete the dissolution of OPTi as          
described in Proposal No. 1 above.                                              

OUR BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE    
ELECTION OF ALL NOMINEES.                                                       

BOARD OF DIRECTORS AND NOMINEE BIOGRAPHICAL INFORMATION 

The names of the nominees, each of whom is currently a director of the    
Company, and certain information about them is set forth below, including       
information furnished by them as to their principal occupations for the last    
five (5) years and their ages as of the Annual Meeting Record Date.             

                                                        [Enlarge/Download Table]

Name of Nominee          Age Position with the Company                                    Since
---------------          --- -------------------------                                    -----
                                                                                               
Bernard T. Marren....... 64  President, Chief Executive Officer and Chairman of the Board 1996 
Stephen A. Dukker(1).... 47  Director                                                     1993 
Kapil K. Nanda(1)(2).... 54  Director                                                     1996 
William H. Welling(1)(2) 67  Director                                                     1998 

--------                                                                        
(1) Member of the Audit Committee.                                              
(2) Member of the Compensation Committee.                                       

  Bernard T. Marren has served as President and Chief Executive Officer of the
Company since May 1998. Mr. Marren was elected as a director in May 1996. Mr.   
Marren founded Western Microtechnology Inc., a distributor of electronic        
systems and semiconductor devices. He served as its President from 1977 to      
1994. He also founded and was the first President of SIA (the Semiconductor     
Industry Association). Mr. Marren is also a director of three private companies.

 Stephen A. Dukker was elected as a director of the Company in January 1993.
He served as President and Chief Executive Officer of eMachines from 1998 to    
April 2001. He was a Senior Vice President of Merchandising at Computer City    
from October 1997 to August 1998. He served as President of OPTi Inc. from      
January of 1996 to October 1997. From May 1994 to mid 1995, Mr. Dukker served   
as President of VideoLogic, Inc., a supplier of video and graphics add-on       
boards. From June 1991 through October 1993, he served as a Senior Vice         
President of CompUSA, Inc., a chain of discount computer superstores. During    
that time he was also a member of the Executive Committee of CompUSA and        
President of its Compudyne Computer manufacturing and mail order subsidiaries.  
Prior to joining CompUSA, Mr. Dukker was President of PC Brand, Inc., a         
manufacturer and mail order distributor of PC products from January 1988 to May 
1991.                                                                           

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  William H. Welling was elected as a director in August 1998. He is currently
Chairman and CEO of @Comm Corporation, a telecommunications software company.   
Since 1983 he has been Managing Partner of Venture Growth Associates, an        
investment firm. Mr. Welling also serves as a director on the boards of several 
private companies.                                                              

  Kapil K. Nanda was elected as a director in May 1996. Mr. Nanda is currently
President of InfoGain Corporation, a software and development consulting        
company, which he founded in 1990. Prior to 1990, Mr. Nanda held various        
positions at Altos Computer Systems, a personal computer manufacturing company, 
from 1981 to 1989. He served as Vice President of Engineering from 1984 to      
1989. From 1974 to 1981, Mr. Nanda was employed at Intel Corporation, serving   
as Manager, Software Engineering from 1976 to 1981. Mr. Nanda holds a B.S. in   
Engineering from the University of Punjab, India, an M.S. in Engineering from   
the University of Kansas, and an M.B.A. from the University of Southern         
California.                                                                     

Vote Required                                                                   

The four (4) nominees receiving the highest number of affirmative votes of
the shares entitled to be voted for them shall be elected as directors. Votes   
withheld from any director are counted for purposes of determining the presence 
or absence of a quorum for the transaction of business, but have no other legal 
effect in the election of directors under California law.                       

MEETINGS AND COMMITTEES OF OUR BOARD OF DIRECTORS 

Board Meetings and Committees                                                   

During the Last Fiscal Year, the Board of Directors held a total of eight 
(8) meetings. No incumbent director attended less than 75% of the aggregate of  
all meetings of the Board of Directors and any committees of the Board on which 
he served, if any, during his tenure as a director.                             

The Audit Committee was established to review, in consultation with the   
independent auditors, the Company's financial statements, accounting and other  
policies, accounting systems and system of internal controls. The Audit         
Committee also recommends the engagement of the Company's independent auditors  
and reviews other matters relating to the relationship of the Company with its  
auditors. The Audit Committee met four (4) time during the Last Fiscal Year.    

The Compensation Committee was established to review and act on matters   
relating to compensation levels and benefit plans for key executives of the     
Company, among other things. The Compensation Committee met two (2) time during 
the Last Fiscal Year.                                                           

The Board of Directors currently has no nominating committee or other     
committee performing a similar function.                                        

DIRECTOR COMPENSATION 

 Non-employee members of the Board of Directors are currently compensated at
the rate of $1,000 per Board meeting attended, plus out-of-pocket expenses for  
attending such meetings. In addition, non-employee directors are eligible to    
participate in the Company's 1993 Director Stock Option Plan.                   

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CERTAIN INFORMATION CONCERNING NOMINATIONS BY 
BREIDER MOORE--SOLICITATION INFORMATION 

Nominations                                                                     

 In a letter dated December 6, 2001, Breider Moore notified the Company that
it intends to nominate nominees for election to the Board. According to an      
article disseminated by a business news wire service, Breider Moore is a San    
Francisco based investment banking and business management consulting firm.     

The Company anticipates that you may receive proxy materials from Breider 
Moore or from others on its behalf recommending that you vote for Breider       
Moore's nominees instead of the Board of Directors' nominees. According to the  
letter received from Breider Moore, Breider Moore intends to nominate certain   
unidentified individuals for election to the Board. Information about the       
nominees may become available through filings Breider Moore may make with the   
SEC. The Company is not responsible for the accuracy of any information         
provided by or relating to Breider Moore or Breider Moore's nominees contained  
in any proxy materials filed or disseminated by Breider Moore or any other      
statement Breider Moore or Breider Moore's nominees may make.                   

The Board of Directors urges you NOT TO SIGN any proxy card sent to you by
Breider Moore. If you have already done so, you may revoke that proxy by        
completing, signing and dating the enclosed WHITE proxy card and returning it   
in the enclosed envelope.                                                       

Solicitation Information                                                        

 The Company has retained the proxy solicitation firm of Mackenzie Partners,
Inc. ("Mackenzie") to assist in the solicitation of proxies. Pursuant to the    
Company's agreement with Mackenzie, it will provide various proxy advisory and  
solicitation services for the Company at an anticipated cost of $    plus       
reasonable out-of-pocket expenses and indemnification against certain           
liabilities. It is expected that Mackenzie will use up to approximately         
persons in such solicitation.                                                   

Certain information concerning the directors, executive officers and other
representatives of the Company who may solicit proxies is set forth below under 
"Participants in the Solicitation."                                             

Although no precise estimate can be made at this time, as a result of the 
election contest the Company anticipates that the aggregate amount to be spent  
by the Company in connection with the solicitation of proxies by the Company    
will be approximately $    of which approximately $    has been incurred to     
date. This amount includes legal fees, printing costs and the fees payable to   
Mackenzie but excludes the salaries and fees of officers, directors, and        
employees of the Company.                                                       

Please complete, date and sign the enclosed WHITE proxy card and return it
promptly in the envelope provided. If your shares are held in "street name,"    
only your bank or broker can vote your shares and only upon your specific       
instructions. Please contact the person responsible for your account and        
instruct him or her to vote the WHITE proxy card as soon as possible.           

The Board of Directors urges you NOT TO SIGN any proxy card sent to you by
Breider Moore. If you have already done so, you may revoke your previously      
signed proxy by delivering a written notice of revocation or a later dated      
WHITE proxy card in the enclosed envelope. If you have questions, or need       
assistance, please call Mackenzie Partners, Inc. at (800) 322-2885 or Michael   
Mazzoni at (650) 625-8787.                                                      

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PROPOSAL NUMBER 4 

RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS  

  The Board of Directors has selected Ernst & Young LLP, independent auditors,
to audit the financial statements of the Company for the fiscal year ending     
December 31, 2001. In the event of a negative vote on such ratification, the    
Board of Directors will reconsider its selection.                               

 If the OPTi shareholders approve the Liquidation Plan set forth in Proposal
No. 1 of this Proxy Statement, the Board of Directors may determine that        
audited financial statements are not required for fiscal year 2001. However,    
OPTi will still require the services of independent accountants to conduct      
yearly audits and other such matters for so long as OPTi is obligated to comply 
with the applicable reporting requirements of the Securities Exchange Act of    
1934, as amended.                                                               

Ernst & Young LLP has audited the Company's financial statements for each 
fiscal year since the Company's inception. Representatives of Ernst & Young LLP 
are expected to be present at the meeting with the opportunity to make a        
statement if they desire to do so, and are expected to be available to respond  
to appropriate questions.                                                       

Vote Required                                                                   

The affirmative vote of a majority of the Votes Cast will be required to  
ratify the appointment of Ernst & Young LLP as the Company's independent        
auditors for the fiscal year ending December 31, 2001.                          

OUR BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE      
APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT ACCOUNTANTS OF OPTi FOR THE     
YEAR ENDING DECEMBER 31, 2001.                                                  

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OTHER INFORMATION 

Executive Officers                                                              

  The following persons are executive officers of the Company as of the Annual
Meeting Record Date:                                                            

                                                        [Enlarge/Download Table]

Name                 Age                           Position                          
----                 ---                           --------                          
                                                                                     
Bernard T. Marren... 64  President, Chief Executive Officer and Chairman of the Board
Michael Mazzoni..... 38  Chief Financial Officer                                     

Bernard T. Marren's biography is set forth above. See "PROPOSAL NUMBER    
TWO--Election of Directors".                                                    

Michael Mazzoni has served as Chief Financial Officer since December 2000.
Mr. Mazzoni also served with the Company from October 1993 to January 2000. The 
last two years prior to his departure Mr. Mazzoni served as our Chief Financial 
Officer. Prior to re-joining the Company, Mr. Mazzoni was Chief Financial       
Officer of Xpeed, Inc., a startup in the Digital Subscriber Line CPE business,  
from January 2000 to November 2000.                                             

Compliance with Section 16(a) of the Securities Exchange Act of 1934            

 Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than 10% of a registered class 
of the Company's equity securities, to file certain reports regarding ownership 
of, and transactions in, the Company's securities with the Securities and       
Exchange Commission (the "SEC") and with Nasdaq. Such officers, directors and   
10% shareholders are also required by SEC rules to furnish the Company with     
copies of all Section 16(a) forms that they file.                               

  Based solely on its review of copies of Forms 3 and 4 and amendments thereto
furnished to the Company pursuant to Rule 16a-3(e) and Forms 5 and amendments   
thereto furnished to the Company with respect to the Last Fiscal Year, and any  
written representations referred to in Item 405(b)(2)(i) of Regulation S-K      
stating that no Forms 5 were required, the Company believes that, during the    
last Fiscal Year, all Section 16(a) filing requirements applicable to the       
Company's officers, directors and 10% shareholders were complied with, except   
for two Form 4's relating to sales of stock not reported by Michael Mazzoni.    

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Security Ownership of Certain Beneficial Owners and Management                  

Except as otherwise indicated, the following nominee table sets forth the 
beneficial ownership of Common Stock of the Company as of November 30, 2001 by: 
(i) each present director of the Company; (ii) each of the officers named in    
the table under the heading "EXECUTIVE COMPENSATION--Summary Compensation       
Table;" (iii) all current directors and executive officers as a group; and (iv) 
each person known to the Company who beneficially owns 5% or more of the        
outstanding shares of its Common Stock. The number and percentage of shares     
beneficially owned is determined under the rules of the SEC, and the            
information is not necessarily indicative of beneficial ownership for any other 
purpose. Under such rules, beneficial ownership includes shares as to which the 
individual has sole or shared voting power or investment power and also any     
shares which the individual has the right to acquire within sixty (60) days of  
November 30, 2001 through the exercise of any stock option or other right.      
Unless otherwise indicated, each person has sole voting and investment power    
with respect to the shares, shown as beneficially owned. Unless otherwise       
indicated, officers and directors can be reached at the Company's principal     
executive offices. A total of 11,633,903 shares of the Company's Common Stock   
were issued and outstanding as of November 30, 2001.                            

                                                        [Enlarge/Download Table]

                                                                        Shares Beneficially
                                                                               Owned       
                                                                        ------------------ 
Name                                                                      Number    Percent
----                                                                    ---------   -------
                                                                                           
Bernard T. Marren(1)...................................................   127,333     1.09%
Michael Mazzoni........................................................        --        * 
Donald Farina(2).......................................................        --        * 
Stephen A. Dukker(3)...................................................    89,166        * 
Kapil K. Nanda(4)......................................................    21,333        * 
William H. Welling(5)..................................................    13,333        * 
Caxton International Ltd.(6)........................................... 1,059,300     9.11%
  315 Enterprise Drive                                                                     
  Plainsboro, NJ 08536                                                                     
Dimensional Fund Advisors Inc.(7)......................................   800,600     6.88%
  1299 Ocean Avenue, 11th Floor                                                            
  Santa Monica, CA 90401                                                                   
MG Capital Management LLC(8)........................................... 1,456,370    12.52%
  1725 Kearny Street, No. 1                                                                
  San Francisco, CA 94133                                                                  
All Directors and Executive Officers as a group (6 persons)(9).........   251,165     2.16%

--------                                                                        
* Represents less than one percent.                                           
(1) Includes 117,333 shares subject to stock option exercisable as of November  
30, 2001 or within sixty (60) days thereafter.                          
(2) Mr. Farina's employment with the Company terminated on July 20, 2001.       
(3) Includes 0 shares subject to stock option exercisable as of November 30,    
2001 or within sixty (60) days thereafter.                              
(4) Includes 17,333 shares subject to stock option exercisable as of November   
30, 2001 or within sixty (60) days thereafter.                          
(5) Includes 0 shares subject to stock option exercisable as of November 30,    
2001 or within sixty (60) days thereafter.                              
(6) Information on holdings of Caxton International Ltd. is taken from a        
   Schedule 13D/A filed on February 26, 2001. Caxton Associates, L.L.C. is the
trading adviser to Caxton International. Bruce S. Kavner is Chairman of 
Caxton Associates.                                                      
(7) Information on holdings of Dimensional Fund Advisors is taken from a        
Schedule 13G filed on February 2, 2001. The shares listed are owned by  
advisory clients of Dimensional Fund Advisors. Dimensional Fund Advisors
   disclaims beneficial ownership of the shares listed. Michael T. Scardina is
Vice President and Chief Financial Officer of Dimensional Fund.         

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(8) Information on the holdings of MG Capital Management is taken from a Form 4 
filed on November 7, 2001. Of the shares listed, 1,420,300 are owned by 
MGCM Partners, L.P., of which MG Capital Management LLC is the general  
  partner and investment advisor. Marco L. Petroni is the controlling person
  of MG Capital. MG Capital and Mr. Petroni disclaim beneficial ownership of
these shares. The remaining 36,070 shares are owned by Mr. Petroni.     
(9) Includes shares pursuant to notes (1), (2), (3), (4) and (5).               

Summary Compensation Table                                                      

The following table sets forth certain information with respect to the    
compensation paid by the Company for services rendered during fiscal years      
2000, 1999 and 1998 to Bernard T. Marren, Michael Mazzoni and Donald Farina     
(the "Named Officers"). The table lists the principal position held by each     
Named Officer in the Last Fiscal Year.                                          

                                                        [Enlarge/Download Table]


                                                                     Long-Term               
                                               Annual Compensation  Compensation             
                                               --------------------    Awards     All Other  
Name                                      Year Salary ($) Bonus ($) Options (#)  Compensation
----                                      ---- ---------- --------- ------------ ------------
                                                                                             
Bernard T. Marren........................ 2000  $255,000  $100,000         --       $5,250(1)
  President and Chief Executive Officer   1999   251,250   420,000         --           --   
                                          1998   150,923        --         --           --   

Michael Mazzoni(2)(3).................... 2000    43,650    75,000         --           --   
  Chief Financial Officer                 1999   145,763    69,525         --           --   
                                          1998   136,475    50,000     45,000           --   

Donald Farina(4)......................... 2000    88,654        --     25,000        3,500(1)
  Vice President, Intellectual Property   1999        --        --         --           --   
                                          1998        --        --         --           --   

--------                                                                        
(1) These amounts are related to the 50% company match on 401K contributions.   
(2) Mr. Mazzoni resigned from the Company in January 2000.                      
(3) Mr. Mazzoni was rehired in December 2000.                                   
(4) Mr. Farina's employment with the Company terminated on July 20, 2001.       

Option Grants in Last Fiscal Year                                               

 The following table provides information with respect to options granted in
the Last Fiscal Year to the Named Officers.                                     

                                                        [Enlarge/Download Table]


                                                Individual Grants                                         
                              -----------------------------------------------------                       
                                                                                     Potential Realizable 
                                                                                       Value at Assumed   
                                Shares of      Percent of                           Annual Rates of Stock 
                               Common Stock  Total Options                          Price Appreciation for
                                Underlying     Granted to                               Option Term(3)    
                                 Options      Employees in    Exercise   Expiration ----------------------
Name                          Granted (#)(1) Fiscal Year(2) Price ($/Sh)    Date        5%         10%    
----                          -------------- -------------- ------------ ----------  -------    --------  
                                                                                                          
Bernard T. Marren............         --            --            --           --        --          --   
Michael Mazzoni..............         --            --            --           --        --          --   
Donald Farina(4).............     25,000          13.9%        $3.75      4/16/10   $58,959    $149,413   

--------                                                                        
(1) All options to Named Officers are granted under the Company's 1993 Stock    
   Option Plan at an exercise price equal to the fair market value on the date
   of the grant. These stock options vest and become exercisable monthly as to
1/8 of the shares beginning six (6) months following the vesting        
commencement date and as to 1/48 of the shares on the first day of each 
month thereafter. Under the terms of the Option Plan, the plan          
   administrator retains the discretion, subject to certain limitations within
   the plan, to modify, extend, renew or accelerate the vesting of options and
to reprice outstanding options. In particular, subject to Board         

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 approval, the plan administrator may reduce the exercise price of an option
to the current fair market price of the underlying stock if the price of  
such stock has declined since the date on which the option was granted.   
(2) Based on 180,000 options granted to employees during the Last Fiscal Year   
under the 1993 and 1995 Stock Option Plan(s).                           
(3) The 5% and 10% assumed rates of appreciation are mandated by the rules of   
 the Securities and Exchange Commission and do not represent the Company's
estimate or projection of the future Common Stock price.                
(4) Mr. Farina's employment with the Company terminated on July 20, 2001.       

Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option      
Values                                                                          

  The following table provides information with respect to option exercises in
the Last Fiscal Year by the Named Officers and the value of such officer's      
unexercised options at December 31, 2000.                                       

                                                        [Enlarge/Download Table]

                                                   Total Number of      Total Value of Unexercised
                                               Unexercised Options at    In-the-Money Options at  
                              Shares             Fiscal Year End (#)      Fiscal Year End ($)(1)  
                               Acq.   Value   ------------------------- --------------------------
Name                          Exer.  Realized Exercisable Unexercisable Exercisable  Unexercisable
----                          ------ -------- ----------- ------------- -----------  -------------
                                                                                                  
Bernard T. Marren............     --      --    100,000          --       $24,500           --    
Michael Mazzoni.............. 20,000 $32,375         --          --            --           --    
Donald Farina(2).............     --      --     16,667       8,333       $18,750       $9,375    

--------                                                                        
(1) Market value of the underlying securities based on the closing price of the 
  Company's Common Stock on December 31, 2000 on the Nasdaq National Market,
minus the exercise price.                                               
(2) Mr. Farina's employment with the Company terminated on July 20, 2001.       

Compensation Committee Interlocks and Insider Participation                     

None.                                                                     

Certain Transactions                                                            

 The Company's policy is that it will not make loans to, or enter into other
transactions with, directors, officers or affiliates unless such loans or       
transactions are (i) approved by a majority of the Company's independent        
disinterested directors, (ii) may reasonably be expected to benefit the         
Company, and (iii) will be on terms no less favorable to the Company than could 
be obtained in arm's length transactions with unaffiliated third parties.       

The Company has entered into indemnification agreements with each of its  
directors and executive officers. Such agreements require the Company to        
indemnify such individuals to the fullest extent permitted by California law.   

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PARTICIPANTS IN THE SOLICITATION  

 Set forth below are the present principal occupation or employment, and the
name and principal address of any corporation or organization in which such     
employment is carried on, for (1) each of the Company's directors and (2) each  
of the Company's executives and other representatives of the Company who may    
solicit proxies from the Company's shareholders.                                

DIRECTORS AND EXECUTIVES OF THE COMPANY 

                   Present Office or Other
Name and Principal Business Address Principal Occupation or Employment      
----------------------------------- ----------------------------------      
Bernard T. Marren.................. President and Chief Executive Officer of
880 Maude Avenue, Suite A          the Company                            
Mountain View, CA 94043                                                   

Michael Mazzoni.................... Chief Financial Officer of the Company  
880 Maude Avenue, Suite A                                                 
Mountain View, CA 94043                                                   

Stephen A. Dukker..................                                         

Kapil K. Nanda..................... President of InfoGain Corporation       

William H. Welling................. Chairman and Chief Executive Officer of 
                                  @Comm Corporation, Managing Partner of
                     Venture Growth Associates

Except as described in this proxy statement, none of the above individuals
(each a "Participant") nor any of their respective affiliates or associates     
(together, the "Participant Affiliates") (i) directly or indirectly             
beneficially owns any securities of the Company or of any subsidiary of the     
Company or (ii) has had any relationship with the Company in any capacity other 
than as a shareholder, employee, officer or director. Furthermore, except as    
described in this proxy statement, no Participant or Participant Affiliate is   
either a party to any transaction or series of transactions since January 1,    
2000, or has knowledge of any currently proposed transaction or series of       
transactions (i) to which the Company or any of its subsidiaries was or is to   
be a party, (ii) in which the amount involved exceeds $60,000, and (iii) in     
which any Participant or Participant Affiliate has or will have, a direct or    
indirect material interest.                                                     

Except as described in this proxy statement, no Participant or Participant
Affiliate has entered into any agreement or understanding with any person       
respecting any (i) future employment by the Company or its affiliates or (ii)   
transactions to which the Company or any of its affiliates will or may be a     
party. Except as described in this proxy statement, there are no contracts,     
arrangements or understandings by any Participant or Participant Affiliates     
within the past year with any person with respect to any capital stock of the   
Company.                                                                        

 Except as disclosed in this proxy statement, to the Company's knowledge, no
Participant or Participant Associate has any interest, direct or indirect, by   
security holdings or otherwise in the Company.                                  

 Listed below are the only purchases and sales of Common Stock from December
1, 1999 through November 30, 2001 by the directors and executives or other      
representatives of the Company who may solicit proxies on the Company's behalf, 
and certain information concerning such transactions. To the Company's          
knowledge, no director or executive or other representative who may solicit     
proxies on the Company's behalf made any other transactions in Company          
securities within the past two years.                                           
                                   Number of Shares    Date of
Name                                    Purchased (Sold)  Transaction   
----                                    ---------------- -------------- 
Michael Mazzoni........................     (20,000)     March __, 2000 

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REPORT OF COMPENSATION COMMITTEE  
OF THE BOARD OF DIRECTORS ON EXECUTIVE COMPENSATION 

  The Compensation Committee of the Board of Directors establishes the general
compensation policies of the Company as well as the compensation plans and      
specific compensation levels for executive officers. It also administers the    
Company's employee stock benefit plans and the 1993 Bonus Plan (the "Bonus      
Plan"). The Compensation Committee is currently composed of independent,        
non-employee directors who have no interlocking relationships as defined by the 
Securities and Exchange Commission.                                             

The Compensation Committee believes that the compensation of the executive
officers, including that of the Chief Executive Officer (collectively, the      
"Executive Officers") should be influenced to a very significant extent by the  
Company's financial performance. The Committee establishes the salaries of all  
of the Executive Officers by considering various factors, including the         
following: (i) the Company's financial performance for the past year, (ii) the  
opportunity of the Executive to participate in the Company's success through    
equity ownership and stock options, (iii) the salaries of executive officers in 
similar positions of comparably-sized companies, and (iv) the critical          
importance of cost control in the Company's business in light of ongoing        
competition. In addition to salary, the cash portion of the Company's executive 
compensation packages includes discretionary bonuses which are paid quarterly   
based on the Company's operating results. The Committee believes that the       
Company's executive Officer salaries and cash compensation are currently less   
than or comparable to the compensation paid to executives at similarly-sized    
businesses in the industry.                                                     

The Company's Bonus Plan provides that the maximum aggregate bonuses to be
paid to any individual Executive Officer in the year will in no event exceed    
two (2) times the base salary of such Executive Officer. In addition, the       
aggregate quarterly bonuses which may be paid to all Executive Officers will    
not exceed 5% of the Company's pre-tax, pre-bonus income for the quarter.       

  Acting with the advice of the Committee, the Board of Directors periodically
grants options to Executive Officers. The Committee views stock option grants   
as an important component of its long-term, performance-based compensation      
philosophy. Since the value of an option bears a direct relationship to the     
Company's stock price, the Committee believes that options motivate Executive   
Officers to manage the Company in a manner which will also benefit              
shareholders. Options are granted at the current market price on the date of    
grant.                                                                          

 The compensation package for the Company's Chief Executive Officer, Bernard
T. Marren, includes three elements: (i) base salary, (ii) performance bonus and 
(iii) stock options. The base salary was determined through a comparison of     
base salaries paid with respect to chief executive officers of other            
publicly-traded semiconductor companies located in Northern California. The     
performance bonus element has been established to provide variable bonus        
compensation to the CEO based on the Company's actual operating results during  
fiscal 1996 and thereafter, including both sales and net income measurements.   
The stock option award is intended to provide long-term compensation to the CEO 
based on the stock performance of the Company. The options vest over a four (4) 
year period. In general, the Committee believes that the compensation package   
of the CEO is closely tied to the financial performance of the Company and has  
a high degree of variability based on such performance.                         

                                       COMPENSATION COMMITTEE OF THE BOARD
                    OF DIRECTORS

                  Kapil K. Nanda
                      William H. Welling

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AUDIT COMMITTEE REPORT  

Under the guidance of a written charter adopted by the Board of Directors,
the purpose of the Audit Committee is to monitor the integrity of the financial 
statements of the company, oversee the independence of the company's            
independent auditor, and recommend to the Board the selection of the            
independent auditor responsible for making recommendations to the Board         
regarding the selection of independent accountants. Each of the members of the  
Audit Committee meets the independence requirements of Nasdaq.                  

Management has the primary responsibility for the system of internal      
controls and the financial reporting process. The independent accountants have  
the responsibility to express an opinion on the financial statements based on   
an audit conducted in accordance with generally accepted auditing standards.    
The Audit Committee has the responsibility to monitor and oversee these         
processes.                                                                      

In this context and in connection with the audited financial statements   
contained in the Company's Annual Report on Form 10-K, the Audit Committee:     

.   reviewed and discussed the audited financial statements with the      
Company's management;                                             

.   discussed with Ernst & Young LLP, the Company's independent auditors, 
     the matters required to be discussed by Statement of Auditing Standards
     No. 61, Communication with Audit Committees, as amended by Statement of
Auditing Standards No. 90, Audit Committee Communications;        

 .   reviewed the written disclosures and the letter from Ernst & Young LLP,
required by the Independence Standards Board Standard No. 1,      
Independence Discussions with Audit Committees, discussed with the
  auditors their independence, and concluded that the nonaudit service
  performed by Ernst & Young LLP are compatible with maintaining their
independence;                                                     

  .   based on the foregoing reviews and discussions, recommended to the Board
   of Directors that the audited financial statements be included in the
 Company's 2000 Annual Report on Form 10-K for the fiscal year ended
      December 31, 2000 filed with the Securities and Exchange Commission; and

.   instructed the independent auditor that the Committee expects to be   
advised if there are any subjects that require special attention. 

                   AUDIT COMMITTEE

                     Stephen A. Dukker
                  Kapil K. Nanda
                      William H. Welling

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RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS 

Ernst & Young LLP has been the independent accounting firm that audits the
financial statements of the Company since its inception. In accordance with     
standing policy, Ernst & Young LLP periodically changes the personnel who work  
on the audit.                                                                   

 Audit Fees. For professional services rendered by Ernst & Young LLP for the
audit of the Company's annual financial statements for the fiscal year ended    
December 31, 2000, and the reviews of the financial statements included in the  
Company's quarterly reports on Form 10-Q for the fiscal year ended December 31, 
2000, Ernst & Young LLP billed the Company fees in the aggregate amount of      
$140,000.                                                                       

Financial Information Systems Design and Implementation Fees. The Company 
did not engage Ernst & Young LLP to provide advice to the Company regarding     
financial systems design and implementation during the fiscal year ended        
December 31, 2000 and thus the Company did not pay any fees to Ernst & Young    
for such services.                                                              

All Other Fees. For professional services other than those described above
rendered by Ernst & Young LLP to the Company for the fiscal year ended December 
31, 2000, Ernst & Young LLP billed the Company fees in the aggregate amount of  
$25,831. All other fees include tax planning and the preparation of tax returns 
of the Company.                                                                 

The Audit Committee reviews summaries of the services provided by Ernst & 
Young LLP and the related fees and has considered whether the provision of      
non-audit services is compatible with maintaining the independence of Ernst &   
Young LLP.                                                                      

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PERFORMANCE GRAPH 

The following graph shows a comparison of cumulative total shareholder    
return, calculated on a dividend reinvested basis, from the effective date of   
the initial public offering of the Company's common stock (December 31, 1993)   
through the Last Fiscal Year end (December 31, 2000) for OPTi Inc., the CRSP    
Index for Nasdaq Stock Market (U.S. Companies) (the "Nasdaq Index") and the     
CRSP Index for Nasdaq Electronic Components Stocks (the "Nasdaq Electronic      
Components Index"). The graph assumes that $100 was invested in the Company's   
common stock on December 31, 1993 at the initial public offering price and in   
the Nasdaq Index and the Nasdaq Electronic Components Index on December 31,     
1993. Note that historic stock price performance is not necessarily indicative  
of future stock price performance.                                              

Comparison of Five-Year Cumulative Total Returns  
Performance Graph for 
OPTi Inc. 

 [CHART]

                                          Nasdaq
                            Nasdaq        Electronic
              OPTi          Stock         Components
Date          Inc.          Market          Stock   
----------     --------       --------        --------    
12/29/1995     $100.000       $100.000        $100.000    
01/31/1996      116.923        100.500          99.956    
02/29/1996      101.538        104.333         104.301    
03/29/1996       70.769        104.682          99.383    
04/30/1996       73.846        113.350         116.417    
05/31/1996       89.231        118.551         123.633    
06/28/1996       63.077        113.210         113.565    
07/31/1996       58.462        103.140         110.040    
08/30/1996       63.077        108.926         118.026    
09/30/1996       72.308        117.248         137.712    
10/31/1996       58.462        115.944         147.930    
11/29/1996       63.846        123.132         171.604    
12/31/1996       63.077        123.028         173.197    
01/31/1997       64.615        131.757         206.162    
02/28/1997       67.692        124.466         182.304    
03/31/1997       70.769        116.347         174.534    
04/30/1997       60.000        119.974         189.152    
05/30/1997       65.385        133.561         195.466    
06/30/1997       55.385        137.668         186.589    
07/31/1997       70.769        152.173         234.206    
08/29/1997       87.692        151.946         239.780    
09/30/1997       91.538        160.951         242.205    
10/31/1997       78.462        152.565         202.604    
11/28/1997       76.923        153.371         201.660    
12/31/1997       83.846        150.680         181.572    
01/30/1998       76.154        155.457         202.121    
02/27/1998       87.692        170.064         224.797    
03/31/1998       88.462        176.352         199.793    
04/30/1998       84.615        179.334         210.118    
05/29/1998       79.231        169.371         183.078    
06/30/1998       83.077        181.200         184.792    
07/31/1998       77.692        179.077         200.219    
08/31/1998       53.077        143.574         164.560    
09/30/1998       60.000        163.492         192.827    
10/30/1998       46.923        170.674         209.092    
11/30/1998       49.231        188.023         249.965    
12/31/1998       56.923        212.450         280.493    
01/29/1999       53.077        243.285         325.832    
02/26/1999       58.462        221.499         279.577    
03/31/1999       70.000        238.255         288.264    
04/30/1999       72.308        245.929         304.867    
05/28/1999       76.923        239.116         284.437    
06/30/1999       74.808        260.630         328.363    
07/30/1999       85.769        255.931         362.112    
08/31/1999       81.538        266.752         417.655    
09/30/1999       86.923        267.118         391.890    
10/29/1999       81.539        288.528         428.251    
11/30/1999       91.539        323.626         457.936    
12/31/1999      141.469        394.809         521.636    
01/31/2000      126.490        380.221         605.040    
02/29/2000      133.147        452.501         796.045    
03/31/2000      139.804        443.188         835.857    
04/28/2000      126.490        372.766         773.117    
05/31/2000      108.182        327.798         706.438    
06/30/2000      136.476        385.355         818.830    
07/31/2000      124.825        364.468         806.767    
08/31/2000      103.189        407.555         915.260    
09/29/2000      146.462        354.601         689.223    
10/31/2000      159.776        325.516         650.640    
11/30/2000      106.518        250.781         495.895    
12/29/2000      129.818        237.457         428.693    

Legend

CRSP Total                                                                      
Returns Index for:  12/1995   12/1996   12/1997   12/1998   12/1999   12/2000   
-----------------   -------   -------   -------   -------   -------   -------   
OPTi Inc.            100.0      63.1      83.8      56.9     141.5     129.8    

Nasdaq Stock Market                                                             
(U.S. Companies)    100.0     123.0     150.7     212.4     394.8     237.5   

Nasdaq Electronic                                                               
Components Stock                                                              
SIC 3670-3679                                                                 
U.S. & Foreign      100.0     173.2     181.6     280.5     521.6     428.7   

Notes:                                                                          

A.  The lines represent monthly index levels derived from compounded daily      
returns that include all dividends.                                     

B.  The indexes are reweighted daily, using the market capitalization on the    
previous trading day.                                                   

C.  If the monthly interval, based on the fiscal year-end, is not a trading     
day, the preceding trading day is used.                                 

D.  The index level for all series was set to $100.0 on 12/29/1995.             

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WHERE YOU CAN FIND MORE INFORMATION 

 We are subject to the reporting requirements of the Securities Exchange Act
of 1934 and file reports, proxy statements and other information with the       
Securities and Exchange Commission. You may read and copy any material we file  
with the Securities and Exchange Commission at its public reference rooms in    
Washington, D.C., New York, New York and Chicago, Illinois. Please call the     
Securities and Exchange Commission at 1-800-SEC-0330 for further information on 
the public reference rooms. Our public filings are also available to the public 
from commercial document retrieval services and at the web site maintained by   
the SEC at http://www.sec.gov. You may also inspect all reports, proxy          
statements and other information we filed with the Nasdaq Stock Market at the   
offices of the National Association of Securities Dealers, Inc., 1735 K Street, 
N.W., Washington, D.C. 20006.                                                   

The SEC allows us to "incorporate by reference" into this document. This  
means that we can disclose important information to you by referring you to     
another document filed separately with the SEC. The information incorporated by 
reference is deemed to be part of this document, except for any information     
superseded by information in this document. This document incorporates by       
reference the documents set forth below that we have previously filed with the  
SEC. These documents contain important information about us and our finances.   

1. OPTi Inc.'s Annual Report on Form 10-K for the fiscal year ended     
December 31, 2000;                                                

   2. OPTi Inc.'s Quarterly Reports on Form 10-Q for the fiscal quarters ended
March 31, 2001, June 30, 2001 and September 30, 2001; and         

3. OPTi Inc.'s Current Report on Form 8-K filed on September 13, 2001.  

  We are also incorporating by reference additional documents that we may file
with the SEC between the date of this document and the date of the meeting of   
shareholders.                                                                   

In conjunction with this proxy statement, we are also sending you our 2000
Annual Report to Shareholders, which includes the Report on Form 10-K           
referenced above. You can obtain additional copies of our Annual Report as well 
as any of the other incorporated documents by contacting us. We will send you   
the documents incorporated by reference without charge.                         

  Shareholders may obtain documents incorporated by reference in this document
by requesting them in writing or by telephone from the following: Michael       
Mazzoni, Chief Financial Officer, OPTi Inc., 880 Maude Avenue, Suite A,         
Mountain View, California 94043, (650) 625-8787.                                

If you would like to request documents from us, including any documents we
may subsequently file with the SEC before the meeting, please do so by December 
, 2001 so that you will receive them before the meeting.                    

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OTHER MATTERS 

  The Company knows of no other matters to be submitted to the meeting. If any
other matters properly come before the meeting, it is the intention of the      
persons named in the enclosed proxy to vote the shares they represent as the    
Board of Directors may recommend.                                               

It is important that your shares of stock be represented at the meeting,  
regardless of the number of shares which you hold. You are, therefore, urged to 
execute and return, at your earliest convenience, the accompanying proxy in the 
envelope which has been enclosed.                                               

                              FOR THE BOARD OF DIRECTORS

                   Michael Mazzoni
             Secretary

Dated December , 2001                                                           

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                                                                       Annex A

PLAN OF COMPLETE LIQUIDATION AND DISSOLUTION OF OPTi INC. 

This Plan of Liquidation and Dissolution (the "Plan") will effect the     
complete liquidation and dissolution of OPTi Inc., a California corporation     
(the "Company"), in accordance with the California Corporations Code (the       
"Code") as follows:                                                             

  1. Approval of the Plan. The Board of Directors of the Company (the "Board")
has adopted this Plan and called a meeting (the "Meeting") of the Company's     
shareholders (the "Shareholders") to vote on the Plan in accordance with        
Section 1900(a) of the Code. If Shareholders holding a majority of the          
Company's outstanding common stock vote for the adoption of this Plan at the    
Meeting, the Plan shall constitute the adopted Plan of the Company as of the    
date of the Meeting (the "Adoption Date").                                      

2. Cessation of Business Activities. After the Adoption Date, the Company 
shall not engage in any business activities, except to the extent necessary to  
preserve the value or dispose of its assets, provide for satisfaction of its    
obligations, adjust and wind up its business and affairs and distribute the     
proceeds from the disposition of its assets in accordance with this Plan. The   
Board then in office shall continue in office solely for that purpose. The      
Board shall dissolve the Company as soon as it deems feasible. The Board shall  
cause to be executed and filed with the Internal Revenue Service Treasury       
Department Form 966 ("Form 966") with a certified copy of the Plan and any      
other required attachments no later than thirty (30) days following the         
Adoption Date. The Board shall also cause to be executed and timely filed with  
the appropriate federal or state agencies all other tax returns, certificates,  
documents, and information returns, including without limitation supplemental   
Forms 966, Treasury Department Forms 1099 Div. ("Forms 1099") and 1096,         
required to be filed by reason of the liquidation and dissolution of the        
Company. The Board shall cause to be timely disseminated to, as appropriate,    
all or any Shareholders all returns, certificates, documents, and information   
returns, including without limitation Forms 1099, required by federal or state  
agencies to be so disseminated by reason of the liquidation and dissolution of  
the Company.                                                                    

3. Continuing Employees and Consultants. For the purpose of effecting the 
dissolution of the Company, the Company shall hire or retain, at the sole       
discretion of the Board, such employees and consultants as the Board deems      
necessary or desirable to supervise the dissolution.                            

 4. Liquidation Process. From and after the Adoption Date, the Company shall
complete the following corporate actions:                                       

     (a) Liquidation of Assets. The Company shall determine whether and when
to (i) transfer any of the Company's patents, other intellectual property and   
certain assets to a liquidating trust (established pursuant to Section 7        
hereof), and (ii) collect, sell, exchange, distribute or otherwise dispose of   
all its property and assets in one or more transactions upon such terms and     
conditions as the Board, in its absolute discretion, deems expedient and in the 
best interests of the Company and the Shareholders, without any further vote or 
action by the Shareholders. The Company's assets and properties may be sold in  
bulk to one buyer or to a small number of buyers or on a piecemeal basis to     
numerous buyers. The Company will not be required to, but may, in its           
discretion, obtain appraisals or other third party opinions as to the value of  
its properties and assets in connection with the liquidation. In connection     
with such collection, sale, exchange, distribution and other disposition, the   
Company shall collect or make provision for the collection (such as through     
operation of the liquidating trust established pursuant to Section 7 hereto) of 
all accounts receivable, debts and claims owing to the Company.                 

     (b) Payment of Obligations. The Company shall satisfy or, as determined
by the Board, make reasonable provision for the satisfaction of, all legally    
enforceable claims and obligations of the Company, including the payment of any 
severance, retention and other compensation claims, all contingent, conditional 
or unmatured claims known to the Company and all claims which are known to the  
Company but for which the identity of the claimant is unknown.                  

      (c) Distributions to Shareholders. The Company shall directly distribute
pro rata to the Shareholders all available cash, including the cash proceeds of 
any sale, exchange or disposition, except such cash, property or                

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assets that are (i) transferred by the Company for the Shareholders' benefit to 
the Trust, or (ii) retained by the Company as a Contingency Reserve (as defined 
below) for paying or making reasonable provision for the claims and obligations 
of the Company. Distributions to or for the benefit of the Shareholders may     
occur all at once or in a series of distributions and shall be in cash or       
assets, in such amounts, and at such time or times, as the Board in its         
absolute discretion may determine. If and to the extent deemed necessary,       
appropriate or desirable by the Board or the Trustees, in their absolute        
discretion, the Company may establish and set aside a reasonable amount of cash 
and/or property (the "Contingency Reserve") to satisfy claims against the       
Company, including, without limitation, tax obligations, all expenses related   
to the sale of the Company's property and assets, all expenses related to the   
collection and defense of the Company's property and assets and the liquidation 
and dissolution provided for in this Plan.                                      

 5. Cancellation of Stock. The distributions to the Shareholders pursuant to
Sections 4, 7 and 8 hereof shall be in complete redemption and cancellation of  
all of the outstanding Common Stock of the Company. As a condition to receipt   
of any distribution, including but not limited to the final distribution, to    
the Shareholders, the Board or the Trustees, in their absolute discretion, may  
require the Shareholders to (i) surrender their certificates evidencing the     
Common Stock to the Company or its agents for recording of such distributions   
thereon or (ii) furnish the Company with evidence satisfactory to the Board or  
the Trustees of the loss, theft or destruction of their certificates evidencing 
the Common Stock, together with such surety bond or other security or indemnity 
as may be required by and satisfactory to the Board or Trustees. The Company    
will finally close its stock transfer books and discontinue recording transfers 
of Common Stock on or immediately prior to the date on which the Company files  
its Certificate of Dissolution in the Office of the Secretary of State of the   
State of California as set forth in Sections 1901 and 1905 of the Code, and     
thereafter certificates representing Common Stock will not be assignable or     
transferable on the books of the Company except by will, intestate succession,  
or operation of law.                                                            

 6. Abandoned Property. If any distribution to a Shareholder cannot be made,
whether because the Shareholder cannot be located, has not surrendered its      
certificates evidencing the Common Stock as required hereunder or for any other 
reason, the distribution to which such Shareholder is entitled shall be         
separately reserved for distribution to such Shareholder. Such separate reserve 
shall be maintained until the earlier of such time as (i) the factor(s)         
preventing the distribution have been resolved to the satisfaction of the       
Company and the distribution is made; or (ii) the distribution may be disposed  
of as "abandoned property" pursuant to the California Code of Civil Procedure   
section 1500 et seq. (the "Civil Code"). If any such distributions cannot be so 
disposed of prior to the filing of the Certificate of Dissolution pursuant to   
Section 9 hereto, the Board shall provide for the maintenance of such separate  
reserve until such time as it may be disposed of pursuant to the Civil Code. In 
no event shall the proceeds of any such distribution revert to or become the    
property of the Company.                                                        

 7. Liquidating Trust. In furtherance of the liquidation and distribution of
the Company's assets to the Shareholders, the Company shall transfer to one or  
more liquidating trustees, for the benefit of the Shareholders (the             
"Trustees"), under a Liquidating Trust (the "Trust"), all of the Company's      
patents, other intellectual property and other assets as set forth in a         
liquidating trust agreement between the Trustees and the Company. The Board is  
hereby authorized to appoint one or more individuals, corporations,             
partnerships or other persons, or any combination thereof, including, without   
limitation, any one or more officers, directors, employees, agents or           
representatives of the Company, to act as the initial Trustees for the benefit  
of the Shareholders and to receive any assets of the Company. Any Trustees      
appointed as provided in the preceding sentence shall succeed to all right,     
title and interest of the Company of any kind and character with respect to     
such transferred assets and, to the extent of the assets so transferred and     
solely in their capacity as Trustees, shall assume all of the liabilities and   
obligations of the Company, including, without limitation, any unsatisfied      
claims and unascertained or contingent liabilities. Further, any conveyance of  
assets to the Trustees shall be deemed to be a distribution of property and     
assets by the Company to the Shareholders for the purposes of Section 4 of this 
Plan. Any such conveyance to the Trustees shall be in trust for the             
Shareholders of the Company. The Company, subject to this Section, may enter    
into a liquidating trust agreement with the Trustees, on such terms and         
conditions as the Board, in its absolute discretion, may deem necessary,        
appropriate or desirable. Adoption of this Plan by a majority of the            
outstanding Common Stock shall constitute the approval of the Shareholders of   
any such                                                                        

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appointment, any such liquidating trust agreement, and any transfer of assets   
by the Company to the Trust as their act and as a part hereto as if herein      
written.                                                                        

8. Liquidation Period. The actions provided for in this Plan shall be     
commenced as soon as practicable after the Adoption Date, and the transfer of   
assets to the Trust shall be completed as soon as practicable in a manner       
consistent with the orderly liquidation and distribution of the Company's       
assets.                                                                         

 9. Certificate of Dissolution. After the Adoption Date, the officers of the
Company shall, at such time as the Board, in its absolute discretion, deems     
necessary, appropriate or desirable, obtain any certificates required from the  
California tax authorities and, upon obtaining such certificates, the Company   
shall file Certificates of Election to Wind Up and Dissolve and Certificate of  
Dissolution pursuant to Sections 1900 et seq. of the Corporations Code of the   
State of California with the Secretary of the State of the State of California  
and make such other filings and undertake such additional steps as are deemed   
necessary or convenient to achieve the dissolution of the Company.              

 10. Shareholder Consent to Sale of Assets. Adoption of this Plan by holders
of a majority of the outstanding Common Stock shall constitute the approval of  
the Shareholders of the sale, exchange, distribution or other disposition in    
liquidation of all of the property and assets of the Company, whether such      
sale, exchange, distribution or other disposition occurs in one transaction or  
a series of transactions, and shall constitute ratification of all contracts    
for sale, exchange or other disposition which are conditioned on adoption of    
this Plan.                                                                      

11. Expenses of Dissolution. In connection with and for the purposes of   
implementing and assuring completion of this Plan, the Company may, in the      
absolute discretion of the Board, pay any brokerage, agency, professional and   
other fees and expenses of persons rendering services to the Company in         
connection with the collection, sale, exchange or other disposition of the      
Company's property and assets and the implementation of this Plan.              

  12. Compensation. In connection with and for the purpose of implementing and
assuring completion of this Plan, the Company may, in the absolute discretion   
of the Board, pay the Company's officers, directors, employees, agents and      
representatives, or any of them, compensation or additional compensation above  
their regular compensation, including pursuant to severance and retention       
agreements, in money or other property, in recognition of the extraordinary     
efforts they, or any of them, will be required to undertake, or actually        
undertake, in connection with the implementation of this Plan. Adoption of this 
Plan by a majority of the outstanding Common Stock shall constitute the         
approval of the Shareholders of the payment of any such compensation.           

13. Indemnification. The Company shall continue to indemnify its officers,
directors, employees, agents and representatives in accordance with its         
Articles of Incorporation, as amended, and Bylaws and any contractual           
arrangements, for the actions taken in connection with this Plan and the        
winding up of the affairs of the Company. The Company's obligation to indemnify 
such persons may also be satisfied out of the assets of the Trust. The Board    
and the Trustees, in their absolute discretion, are authorized to obtain and    
maintain insurance as may be necessary or appropriate to cover the Company's    
obligation hereunder.                                                           

14. Amendment or Termination of the Plan. Notwithstanding authorization or
consent to this Plan and the transactions contemplated hereby by the            
Shareholders, the Board may modify, amend or terminate this Plan and the        
transactions contemplated hereby without further action by the Shareholders to  
the extent permitted by the Code.                                               

15. Authorization. The Board of the Company is hereby authorized, without 
further action by the Shareholders, to do and perform or cause the officers of  
the Company, subject to approval of the Board, to do and perform, any and all   
acts, and to make, execute, deliver or adopt any and all agreements,            
resolutions, conveyances, certificates and other documents of every kind which  
are deemed necessary, appropriate or desirable, in the absolute discretion of   
the Board, to implement this Plan and the transactions contemplated hereby,     
including without limitation, all filings or acts required by any state or      
federal law or regulation to wind up its affairs.                               

                       Adopted by the Board of Directors on September 7, 2001.

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                                                                       ANNEX B

FORM OF 

AGREEMENT 

of  

OPTi INC. LIQUIDATING TRUST 

, 2002  

This Liquidating Trust Agreement is made and entered into this     day of 
, 2002, (the "Effective Date") by and between OPTi Inc. ("OPTi" or the          
"Company"), a California corporation, and Stephen A. Dukker, Kapil K. Nanda and 
William H. Welling (hereinafter referred to collectively as the "Trustees").    

Whereas, pursuant to a vote of the OPTi shareholders at a meeting of OPTi 
shareholders held on       , 2002, the Company (i) adopted a plan of            
Liquidation and Dissolution (the "Plan") and (ii) approved the selection of the 
Trustees, who are hereby entering into an agreement with OPTi for the creation  
of a trust for the benefit of the shareholders of OPTi;                         

  Whereas, the Plan requires that OPTi be dissolved and its assets, net of its
liabilities and expenses, be distributed to the shareholders of OPTi;           

Whereas, the Plan contemplates that the Company presently owns assets that
cannot be distributed conveniently in kind; and                                 

Whereas, the Plan authorizes the establishment of a liquidating trust for 
the benefit of the shareholders.                                                

  Accordingly, this Liquidating Trust Agreement (the "Agreement") provides (i)
for the establishment of the OPTi Inc. Liquidating Trust (the "Trust") to hold  
all right, title and interest to all patents and other intellectual property as 
specified herein which, as of the Effective Date, are held by OPTi, and to any  
other property which is held by OPTi as of the Effective Date and not           
distributed outright to OPTi shareholders pursuant to OPTi's liquidation; and   
(ii) for the orderly liquidation and distribution of the Trust's assets.        

It is therefore agreed as follows:                                        

1.  Establishment of Trust.                                               

1.1 This Agreement establishes the Trust in accordance with Treasury
Regulations Section 301.7701-4(d), in order to complete the liquidation of
  all the properties transferred to the Trust in the course of the liquidation
of the Company and not to engage in the conduct of an active trade or     
business or any other activity except as specifically provided in this    
Agreement. Upon execution of this Agreement, OPTi is transferring and/or  
assigning to the Trust all right, title and interest to the following (i) 
cash in the amount of $   ; (ii) all of the patents and other intellectual
  property held by OPTi as of the Effective Date, including but not limited to
 applications for the continuation of such patents, as set forth on Schedule
  A (the "IP"); and (iii) all other assets identified on Schedule A reasonably
related to the purposes of the Trust. The Trustees shall hold the assets  
identified in clauses (i), (ii) and (iii) of the preceding sentence,      
 together with any income earned thereon and all other property of OPTi that
may be transferred to the Trust or that may come into the Trustees'       
possession (collectively, the "Trust Estate") in trust for the benefit of 
the shareholders of OPTi (the "Beneficiaries") as of close of business in 
   California on     , 2002 (the "Record Date"). The Company      shall have
executed or caused to be executed and delivered to, or upon the order of, 
the Trustees, any and all documents and other instruments as may be       
necessary or useful to convey the Trust Estate to, and to confirm title to
the Trust Estate in, the Trust (a list                                    

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of such documents is set forth on Schedule B attached hereto). The Company
  shall notify the Trustees of the nature and location of any property that is
useful or necessary to carryout the purposes of the Trust which is later  
discovered and not described in Schedule A, and of the nature and location
of any document and other instruments as may be necessary or useful to    
  convey the Trust Estate to, and to confirm title to the Trust Estate in, the
  Trust which is later discovered and not described in Schedule B. The Company
will, upon reasonable request of the Trustees, execute, acknowledge and   
deliver such further instruments and do such further acts as may be       
  necessary or proper to transfer to the Trust any portion of the Trust Estate
 intended to be conveyed hereby and to vest in the Trust the IP and funds in
trust hereunder. However, the Trustees shall be responsible only for the  
property delivered to them and shall have no duty to search for unknown   
property, or unknown liabilities or obligations with respect to any       
property, and shall not be liable for any failure to do so.               

 1.2 The purposes of the Trust are to manage, conserve and protect the
value of the Trust Estate for the benefit of the Beneficiaries, including,
but not limited to: (i) collecting and liquidating the Trust Estate; (ii) 
pursuing those claims and causes of action vested in the Trust Estate     
including pursuing applications for the continuation of the IP and taking 
 actions to enforce on behalf of the Beneficiaries the Trust's rights to the
IP against third parties; (iii) contesting and/or paying any liability    
  asserted against the Trust Estate or the Trustees as transferee of the Trust
Estate; and (iv) distributing to the Beneficiaries all proceeds from the  
liquidation of the Trust Estate. The Trustees will make continuing efforts
to dispose of the Trust Estate and make timely distributions, and will not
unduly prolong the duration of the Trust. The Trustees will further use   
their best efforts by making distributions to the Beneficiaries to ensure 
that the value of the assets held by the Trust does not exceed $10 million
on the last day of each fiscal year that the Trust remains existing. In no
event shall any part of the Trust Estate revert or be distributed to the  
Company or to any shareholder of the Company, as such, other than         
Beneficiaries entitled thereto under the terms of this Agreement.         

1.3 The Trustees hereby assign to the Beneficiaries the Beneficial  
  Interests (as defined in Section 2.1 herein) in all of the Trust Estate, and
retain only such incidents of ownership therein as are necessary to       
undertake the actions and transactions authorized herein.                 

2. Beneficiaries.                                                         

2.1 Beneficial Interests.                                           

   Each Beneficiary shall receive an interest in the Trust Estate equal to
the ratio of (a) the number of shares of OPTi common stock beneficially   
  owned by such Beneficiary at the close of business on the Record Date to (b)
 the total number of shares of OPTi common stock outstanding at the close of
  business on the Record Date so that the Beneficiary's percentage interest in
 the overall Trust Estate is equal to the Beneficiary's percentage ownership
of the outstanding shares of common stock of OPTi on the Record Date      
(collectively, "Beneficial Interests"). The Beneficial Interest of each   
Beneficiary shall be recorded by the Trustees or their agents on the books
of the Trust. The Trustees may rely for purposes of distributions and     
communications upon information relating to each Beneficiary as it appears
in the shareholder records of OPTi maintained by its transfer agent. A    
  Beneficiary may provide his/her address or other information to the Trustees
by notifying the Trustees in writing. If the Trust holds assets for       
unlocated Beneficiaries, the Trustees shall give due notice to those      
Beneficiaries in accordance with local law. Neither the Trustees nor their
agents shall issue any certificates or other evidences of ownership       
 representing Beneficial Interests. If any conflicting claims or demands are
made or asserted to any Beneficial Interests, or if there should be any   
disagreement between the transferees, assignees, heirs, representatives or
  legatees succeeding to all or a part of the interest of any OPTi shareholder
or Beneficiary resulting in adverse claims or demands being made in       
connection with such interest, then, in any of such events, the Trustees  
shall be entitled, at their sole discretion, to refuse to comply with any 
such conflicting claims or demands. In so refusing, the Trustees may elect
to make no payment or distribution in respect of the Beneficial Interests 
 involved, or any part thereof, and in so doing the Trustees shall not be or
become liable to any of such parties for their failure or                 

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 refusal to comply with any of such conflicting claims or demands, nor shall
  the Trustees be liable for interest on any funds which they may so withhold.
The Trustees shall be entitled to refrain and refuse to act until (i) the 
rights of the adverse claimants have been resolved by valid written       
agreement between all of such parties, and the Trustees shall have been   
furnished with a fully executed duplicate of such agreement; (ii) there is
furnished to the Trustees a surety bond or other security satisfactory to 
the Trustees, as they shall deem appropriate, to fully indemnify the      
Trustees and the Trust Estate from any loss, liability, cost or expense   
which might arise from such disagreement; or (iii) the Trustees shall have
been furnished with a judicial order resolving the rights of the adverse  
claimants.                                                                

2.2 Rights of Beneficiaries.                                        

Each Beneficiary shall be entitled to participate in the rights and 
  benefits due to a Beneficiary under this Agreement. Each Beneficial Interest
  shall be held subject to all the terms and provisions of this Agreement. The
interest of a Beneficiary is hereby declared to, and shall be, in all     
respects personal property and upon the death, insolvency or incapacity of
 an individual Beneficiary, the Beneficiary's interest shall pass to his/her
legal representative and such death, insolvency or incapacity shall not   
terminate or affect the validity of this Agreement. No Beneficiary shall  
have any title to, right to, possession of, management of, or control of, 
 the Trust Estate except as provided in this Agreement. No surviving spouse,
 heir, or devisee of any deceased Beneficiary shall have any right of dower,
  or inheritance, or of partition, or any other right, statutory or otherwise,
in any property whatever forming a part of the Trust Estate, but the whole
title to all the Trust Estate shall be vested in the Trustees and the sole
  interest of the Beneficiaries shall be the rights and benefits given to such
persons under this Agreement.                                             

2.3 No Transfer of Beneficial Interests.                            

   The Beneficial Interest of a Beneficiary in the Trust Estate may not be
transferred in whole or in part except by will, intestate succession or   
operation of law or transfers from nominee record holders to beneficial   
owners, and any attempted transfer shall be of no force and effect as     
between the Trustees and the Beneficiary attempting such transfer.        

2.4 Trustees as Beneficiaries.                                      

 The Trustees, either individually or in a representative or fiduciary
capacity, may be Beneficiaries to the same extent as if they were not the 
Trustees hereunder.                                                       

3. Powers and Duties of the Trustees.                                     

   3.1 The Trustees, subject only to the specific limitations contained in
  this Agreement, shall have, without further or other authorization, and free
from any power or control on the part of the Beneficiaries, full, absolute
and exclusive power, control and authority over the Trust Estate and over 
  the affairs of the Trust to the same extent as if the Trustees were the sole
owners thereof in their own right, provided, however, that such power,    
 control and authority shall only be exercised to do such acts and things as
in their sole judgment and discretion are necessary or incidental to, or  
desirable for, carrying out the purposes of the Trust. Any determination  
made in good faith by the Trustees as to the appropriate means to achieve 
the purposes of the Trust or as to the existence of any power or authority
hereunder shall be conclusive and binding upon the Beneficiaries. In      
construing the provisions of this Agreement, all presumptions shall be in 
favor of the grant of powers and authority to the Trustees, except insofar
 as the existence of any such power or authority would jeopardize the status
of the Trust as a liquidating trust for federal income tax purposes, or   
subject the Trust to the registration provisions of the Securities Act of 
1933, as amended, or the Securities Exchange Act of 1934, as amended, the 
 qualification provisions of the Trust Indenture Act of 1939, as amended, or
the registration provisions of the Investment Company Act of 1940, as     
  amended. Notwithstanding any other provision hereof, the Trustees shall have
  no power or authority to enter into or engage in the conduct of any trade or
business in respect of the Trust Estate.                                  

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   3.2 The Trustees shall not do any act or undertake any activity unless they
determine, in good faith, that such act or activity is desirable, necessary,
or appropriate for the management, conservation, and protection of the Trust
Estate. The Trustees shall not do any act or undertake any activity that    
would jeopardize the status of the Trust as a liquidating trust for federal 
 income tax purposes, or jeopardize any exemptions available to the Trust from
the registration provisions of the Securities Act of 1933, as amended, the  
registration and reporting requirements of the Securities Exchange Act of   
1934, as amended, or the registration and reporting provisions of the       
Investment Company Act of 1940, as amended. In no event shall the Trustees  
receive any property, make any distribution, satisfy or discharge any       
 obligation, claim, liability or expense or otherwise take any action which is
inconsistent with a complete liquidation of the Company. The Trustees shall 
not at any time, on behalf of the Trust or the Beneficiaries, enter into or 
engage in any business, and no part of the Trust Estate or the proceeds,    
revenue, or income therefrom shall be used or disposed of by the Trustees in
furtherance of any business. This limitation shall apply irrespective of    
 whether the conduct of any such business activities is deemed by the Trustees
to be necessary or proper for the conservation and protection of the Trust  
Estate. The Trustees' activities under this Agreement shall be restricted to
the holding, liquidation and collection of the Trust Estate and the payment 
and distribution thereof for the purposes set forth in this Agreement and to
 the conservation and protection of the Trust Estate, including the pursuit of
causes of action and claims related to the IP, and the administration of the
 Trust in accordance with the provisions of this Agreement. In particular, the
 Trustees shall take any and all necessary and reasonable steps to ensure that
the Trust does not (i) receive any listed stocks or securities, any readily 
marketable assets, or any operating assets of a going business; (ii) receive
or retain any cash in excess of a reasonable amount to manage, conserve and 
 protect the Trust Estate and to meet claims and contingent liabilities; (iii)
receive transfers of any unlisted stock of an issuer; or (iv) receive       
transfers of any general or limited partnership interests. In the event that
the Trustees' reasonable best efforts cannot prevent the Trust's receipt of 
any listed stocks or securities as described in clause (i) or excess cash as
 described in clause (ii) of the preceding sentence as a result of the sale or
exchange of Trust assets, then the Trustees shall retain such stock,        
securities, or cash only for the limited time necessary to effect, in an    
orderly fashion, either their liquidation, their distribution to the        
Beneficiaries or their use to pay creditors' claims, whichever is most      
practicable. The investment powers of the Trustees are limited to powers to 
invest the cash portions of the Trust Estate only in (i) demand and time    
 deposits in banks or savings institutions; or (ii) temporary investments such
 as short-term certificates of deposit, Treasury bills, or money market funds.

  3.3 Subject to the limitations of Sections 1.1 and 3.2, in addition to
any powers conferred upon them by any other section or provision of this  
 Agreement or by virtue of any present or future statute or rule of law, the
Trustees shall have all such powers and authority as they may determine   
 appropriate to carry out their obligations under this Agreement, including,
but not limited to, the power and authority:                              

    (a) to take any action and make any determination that, in their
      absolute discretion, is necessary or appropriate to protect and preserve
any asset or right that is a part of the Trust Estate;            

      (b) to pay, defend, litigate, arbitrate, compromise, or settle any
  claim against the Trust Estate or the Trustees as transferees of the
Trust Estate, and, in their absolute discretion, to make all      
determinations necessary in connection with any such claim;       

        (c) to engage professionals, including but not limited to attorneys,
 accountants, investment advisors, and agents to perform the routine
    operations of the Trust, and to pay to those professionals, out of the
  Trust Estate, reasonable compensation and reimbursement of expenses;

(d) to hold all or part of the Trust Estate uninvested;     

   (e) to invest the cash portions of the Trust Estate only in (i)
demand and time deposits in banks or savings institutions, or (ii)
temporary investments such as short-term certificates of deposit, 
Treasury bills or money market funds;                             

 (f) to exercise and/or defend any right incident to property,
    including, any right related to the IP, held by the Trust at any time;

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    (g) to authorize any person or entity to act with respect to any
  specified transaction or transactions, to sign a particular check or
   checks, and to execute any other instrument or instruments in his/her
name or on behalf of the Trust;                                   

       (h) to receive on behalf of the Beneficiaries and for their benefit
    all liquidating distributions, unclaimed dividends, and other payments
    distributable to those Beneficiaries who have not been located, and to
dispose thereof in accordance with applicable law;                

    (i) to retain cash not to exceed a reasonable amount to meet the
     claims, obligations, liabilities, including contingent liabilities, and
expenses of the Trust and the Trustees and to effect an orderly   
liquidation or disposition of the Trust Estate;                   

       (j) to collect, liquidate or otherwise convert into cash all claims
     and assets of the Company related to the IP, to trade, sell, assign, or
     exchange assets constituting part of the Trust Estate for other assets,
and to pay, discharge, and satisfy all remaining obligations,     
liabilities, and expenses of the Trust and the Trustees, and in   
      exercising such powers the Trustees shall not be prohibited from trading
   or exchanging any assets with, or selling or assigning any assets to,
any person who was an officer of the Company;                     

        (k) pending disposition or distribution, to retain all or any assets
     constituting part of the Trust Estate regardless of whether or not such
   assets are, or may become, underproductive, unproductive or a wasting
      asset, or whether such assets, if considered to be investments, might be
     considered to be speculative or extra-hazardous. The Trustees shall not
   be chargeable with interest on any part of the Trust Estate except to
the extent that interest may actually be earned;                  

        (l) to adopt bylaws and other rules of procedure for meetings of the
Beneficiaries and for the general administration of the Trust;    

         (m) to withhold from the Trust Estate distributable to certain or all
of the Beneficiaries from time to time those amounts that may be  
    sufficient to pay any taxes or other charges which have been or may be
   imposed under the laws of the United States or any state or political
    subdivision thereof by reason of distributions to the Beneficiaries or
      otherwise, whether or not the withholding of such amounts is required by
law or regulation;                                                

         (n) to enter into agreements with taxing or other authorities for the
    payment or compromise of claims for such amounts as may be withheld or
    were not withheld and which are chargeable against the Trust Estate in
accordance with the provisions of this Section;                   

      (o) to engage in, intervene in, prosecute, join, defend, compound,
      settle, compromise, abandon, or adjust, by arbitration or otherwise, any
    actions, suits, proceedings, disputes, claims, controversies, demands,
    or other litigation to enforce any instruments, contracts, agreements,
    claims, or causes of action relating to the Trust, the Trust Estate or
      the Trust's affairs, to enter into agreements relating to the foregoing,
    whether or not any suit is commenced or claim accrued or asserted and,
in advance of any controversy, to enter into agreements regarding 
     arbitration, adjudication or settlement thereof, all in the name of the
Trust if otherwise required;                                      

     (p) to cancel, terminate, or amend any instruments, contracts, or
  agreements relating to or forming a part of the Trust Estate, and to
      execute new instruments, contracts, or agreements, provided that no such
new instrument, contract or agreement shall permit the Trustees to
engage in any activity prohibited under this Agreement;           

  (q) to contract for and to borrow money in such amounts as the
    Trustees deem advisable for any Trust purpose (including protecting or
  conserving any portion of the Trust Estate and making any payment of
income or principal) and, in connection therewith, to draw, make, 
    accept, endorse, execute, issue, and deliver promissory notes, drafts,
and other negotiable or transferable instruments and evidences of 
indebtedness and all renewals or extensions thereof;              

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         (r) if any of the property which is or may become a part of the Trust
Estate is situated in any state or other jurisdiction in which any
    Trustee is not qualified to act as Trustee, to nominate and appoint an
     individual or corporate trustee qualified to act in such state or other
    jurisdiction in connection with the property situated in that state or
  other jurisdiction as a trustee of such property and to require from
  such trustee such security as may be designated by the Trustees. The
    trustee so appointed shall have all the rights, powers, privileges and
  duties and shall be subject to the conditions and limitations of the
   Trust, except as modified or limited by the Trustees and except where
      the same may be modified by the laws of such state or other jurisdiction
  (in which case, the laws of the state or other jurisdiction in which
 such trustee is acting shall prevail to the extent necessary). Such
  trustee shall be answerable to the Trustees herein appointed for all
     money, assets, and other property which may be received by such trustee
  in connection with the administration of such property. The Trustees
     hereunder may remove such trustee, with or without cause, and appoint a
 successor trustee at any time by the execution by the Trustees of a
written instrument declaring such trustee removed from office and 
specifying the effective time of removal;                         

       (s) to perform any act authorized, permitted, or required under any
instrument, contract, agreement, or cause of action relating to or
forming a part of the Trust Estate, whether in the nature of an   
      approval, consent, demand, or notice hereunder or otherwise, unless such
   act would require the consent of the Beneficiaries in accordance with
the express provisions of this Agreement;                         

        (t) to prepare and file, or assist in the preparation and filing of,
      Federal and state tax returns and reports required to be filed on behalf
of the Trust or the Trustees; and                                 

       (u) to take all such other action, and execute and deliver all such
  documents and agreements, as the Trustees in their sole judgment may
    determine necessary or appropriate to carry out their responsibilities
under this Agreement or local or federal law.                     

The enumeration of such powers shall not be considered in any way to
limit or control the Trustees' power to act as generally authorized in    
  Section 3.1 and as specifically authorized in any other section or provision
of this Agreement.                                                        

 3.4 The Trustees shall maintain or cause to be maintained records and
books of account relating to the Trust Estate in accordance with generally
accepted accounting principles consistently applied and shall at all      
reasonable times permit any authorized representative designated by any   
Beneficiary to have access to the financial records relating to the Trust 
 Estate. The Trustees shall provide the Beneficiaries with all necessary tax
information and make available to the Beneficiaries such annual or more   
frequent reports as the Trustees shall determine in their sole discretion,
with the advice of counsel, to comply with the income tax obligations at  
Treasury Regulations Section 1.671-4 and any other applicable sections.   

   3.5 The Trustees shall not, in their personal capacities or as officers
  or employees of another person, or through interests in another person, loan
  property to, or render services other than as Trustees to, or otherwise deal
with the Trust (including receiving compensation from such persons as well
as from the Trust) as if they were not Trustees.                          

 3.6 The Trustees shall perform their obligations under this Agreement
with the same degree of care and skill as a prudent person would exercise 
under the circumstances in the conduct of their own affairs. The Trustees 
shall not commingle any of the Trust Estate with their own property or the
property of any other person.                                             

   3.7 Unless otherwise specified, each of the rights, duties, obligations
and powers of the Trustees described herein shall be held jointly and     
severally by each Trustee, provided however, that the Trustees shall      
 delegate and/or divide the duties involved in administering the Trust among
 the Trustees in a manner which, in their business judgment, shall allow for
efficient administration of the Trust; and provided further,              

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that any disagreement among the Trustees with respect to the conduct of   
  their rights, duties, obligations and powers shall be resolved by a majority
vote of the Trustees. The Trustees shall meet periodically as they deem   
necessary, but no less than semi-annually, to review the activities the   
Trust and the Trustees shall maintain minutes of such meetings and other  
actions by the Trustees as they deem necessary. The Trustees shall consult
with professionals as set forth in Section 4.2, as deemed necessary by the
 Trustees in their sole discretion, in order to ensure that the Trust Estate
is being administered in accordance with this Agreement and with the      
purposes of the Trust set forth herein.                                   

4. Liability Of Trustees And Beneficiaries And Other Matters.             

     4.1 No Trustee shall be liable to the Trust or to any Beneficiary for any
error in business judgment or for any act or omission of himself or any   
other Trustee, Beneficiary, or agent of the Trust, or be held to any      
personal liability whatsoever in connection with the affairs of the Trust,
except only that arising from their own bad faith, willful misconduct in  
ascertaining the pertinent facts, intentional misconduct or knowing and   
 culpable violation of law, gross negligence, or reckless disregard of duty.
The Trustees shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Agreement, and no   
implied covenants or obligations shall be read into this Agreement against
the Trustees. In addition to, and not in limitation of, the foregoing, no 
successor Trustee shall be liable in any way for any error in business    
judgment or for the acts or omissions of any Trustee or agent of the Trust
occurring prior to the date on which he/she became a successor Trustee or 
with respect to any error in business judgment or any action taken or     
omitted to be taken by him/her in his/her capacity as successor Trustee.  

  4.2 The Trustees may consult with counsel, auditors, or other experts,
 and the advice or opinion of such counsel, auditors, or other experts shall
be full and complete personal protection to the Trustees in respect of any
action taken or suffered by them in good faith and in reliance upon or in 
accordance with such advice or opinion. In discharging their duties, the  
Trustees may rely upon financial statements of the Trust represented to be
 correct by the person having charge of its books of account, or stated in a
written report by an independent certified public accountant to present   
 fairly the financial position of the Trust. The Trustees may rely upon, and
  shall be protected in acting or refraining from acting in reliance upon, any
certificate, opinion, statement, instrument, or report believed by him/her
to be genuine and to have been signed or presented by the proper person or
persons.                                                                  

     4.3 The Trustees, in incurring any debts, liabilities, or obligations, or
  in taking or omitting any other actions for or in connection with the Trust,
are, and shall be deemed to be, acting as Trustees of the Trust and not in
their own individual capacities. Except to the extent provided in Section 
 4.1, no Trustee or Beneficiary shall be liable for any debt, claim, demand,
 judgment, decree, liability, or obligation of any kind of, against, or with
respect to the Trust, arising from any action taken or omitted for or on  
behalf of the Trust, and the Trust shall be solely liable therefor, and   
resort shall be had solely to the Trust Estate for the payment or         
performance thereof. Each Beneficiary shall be entitled to pro rata       
 indemnity from the Trust Estate if, contrary to the provisions hereof, such
Beneficiary shall be held to any such personal liability.                 

4.4 As far as practicable, the Trustees shall cause any written     
instrument creating an obligation of the Trust to include a reference to  
this Agreement and to provide that neither the Beneficiaries nor the      
Trustees shall be liable thereunder and that the other parties to such    
instrument shall look solely to the Trust Estate for the payment of any   
claim thereunder or the performance thereof; provided, however, that the  
omission of such provision from any such instrument shall not render the  
 Beneficiaries or Trustees liable nor shall the Trustees be liable to anyone
for such omission.                                                        

4.5 Indemnification of Trustees; Insurance.                         

         (a) The Trustees shall be indemnified by the Trust Estate against any
loss, liability, expense (including attorneys' fees and costs), or
damage which any Trustee may incur or sustain by reason of        

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     the fact that he/she is or was a Trustee of the Trust or for performing
  any function incidental to such service; provided, however, that the
 foregoing shall not relieve such person of liability for bad faith,
    intentional misconduct or knowing and culpable violation of law, gross
 negligence, or reckless disregard of the duties and obligations set
forth in this Agreement.                                          

        (b) Indemnification under paragraph (a) of this Section 4.5 shall be
made by the Trust as authorized in the specific case unless a     
 determination has been made that indemnification of the Trustees is
    improper in the circumstances because they have not met the applicable
  standards of conduct. Such determination shall be made in writing by
independent legal counsel (who may be counsel to the Trust).      

(c) Expenses incurred in connection with a civil, criminal, 
     administrative, or investigative action, suit, or proceeding, or threat
     thereof, shall be paid by the Trust in advance of the final disposition
      of such action, suit, or proceeding as authorized in the manner provided
     in paragraph (b) of this Section 4.5, upon receipt of an undertaking by
      or on behalf of the Trustees to repay such amount if it shall ultimately
      be determined that he/she is not entitled to be indemnified by the Trust
as authorized herein.                                             

     (d) The indemnification provided in this Section 4.5 shall not be
    deemed exclusive of any other rights to which those indemnified may be
      entitled under any other agreement both as to action in his/her official
      capacity and as to action in another capacity while holding such office,
 and shall continue as to a person who has ceased to be Trustees and
    shall inure to the benefit of the heirs, executors, and administrators
of such person.                                                   

       (e) The Trust shall have the power by resolution of the Trustees to
   purchase and maintain at the expense of the Trust insurance on behalf
    and for the benefit of any person who is or was a Trustee of the Trust
 against any expenses incurred in any proceeding and any liabilities
     asserted against him/her in his/her capacity as Trustee, whether or not
the Trust would have the power to indemnify him/her against such  
liability under the provisions of this Section 4.5.               

5. Concerning the Trustees.                                               

   5.1 Subject to the provisions hereof relating to the period pending the
appointment of a successor Trustee, there shall be three Trustees of this 
Trust. Stephen A. Dukker, Kapil K. Nanda and William H. Welling are hereby
 named, constituted, and appointed as Trustees, to act and serve as Trustees
of the Trust and to perform the powers and functions of Trustees to       
accomplish the objective of the Trust as provided in this Agreement. Each 
  Trustee is willing, and does hereby accept the appointment, to act and serve
as a Trustee of the Trust and to hold the Trust Estate and administer the 
 Trust pursuant to the terms of this Agreement. Each Trustee hereby declares
  and agrees that he/she is holding the Trust Estate solely for the benefit of
the Beneficiaries, and retains only such incidents of ownership as are    
necessary to undertake the actions and transactions authorized herein.    

   5.2 The Trust shall be irrevocable except to the extent contemplated in
 Section 11 hereto and in no event shall any part of the Trust Estate revert
to the Company.                                                           

    5.3 Unless a bond is required by law, the Trustees shall not be required
to give a bond or security in respect of their execution or performance of
this Agreement.                                                           

   5.4 Any Trustee may be removed at any time, but only for good cause, by
  Beneficiaries holding more than 50% of the total Beneficial Interests in the
Trust. Any Trustee may resign and be discharged from the Trust hereby     
 created by giving at least 30 days written notice thereof. Such resignation
shall become effective on the day specified in such notice or upon the    
appointment of such Trustee's successor and such successor's acceptance of
such appointment, whichever is earlier, without need for prior accounting.

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    5.5 If a Trustee resigns, is removed, dies, becomes incapable of action,
or is adjudged a bankrupt or insolvent, or if the authorized number of    
Trustees is increased, a vacancy shall be deemed to exist and, unless the 
vacancy is eliminated by changing the number of Trustees as provided in   
Section 11, a successor trustee shall be appointed. If any vacancy is not 
filled or eliminated by the remaining Trustee(s) within 90 days, the      
Beneficiaries may elect one or more successor Trustees by a vote of       
 Beneficiaries having more than 50% of the total Beneficial Interests in the
  Trust. Pending the appointment of a successor Trustee, any remaining Trustee
then serving, as long as there is at least one, may take any action in the
manner set forth in Section 5.7 hereof.                                   

     5.6 Any successor Trustee appointed hereunder shall execute an instrument
accepting such appointment hereunder and shall deliver one counterpart    
 thereof to each of the other Trustees if any and, in case of a resignation,
  to the retiring Trustee. Thereupon such successor Trustee shall, without any
  further act, become vested with all the estates, properties, rights, powers,
trusts, and duties of his/her predecessor in the Trust hereunder with like
  effect as if originally named herein; but in the case of a retiring Trustee,
such retiring Trustee shall nevertheless, when requested in writing by the
successor Trustee or by the remaining Trustees, execute and deliver an    
instrument or instruments conveying and transferring to such successor    
Trustee subject to the Trust herein expressed all the estate, properties, 
 rights, powers, and trusts of such retiring Trustee, and shall duly assign,
 transfer, and deliver to such successor Trustee all property and money held
by said retiring Trustee hereunder.                                       

     5.7 Notwithstanding the provisions of Section 5.1, as long as there is at
 least one Trustee, any action taken by the such Trustee as provided in this
Agreement shall be valid despite the occurrence of a vacancy or vacancies.

5.8 The Trust shall not be administered under the direction or      
jurisdiction of any court, nor shall there be any duty of the Trustees to 
 account to any court with respect to his administration of the Trust or the
Trust Estate.                                                             

6. Trustees' Compensation.                                                

6.1 In lieu of commissions or other compensation fixed by law for   
  trustees, each Trustee shall be entitled to receive as an administrative fee
as compensation for his/her services as Trustee $3,000 for each meeting of
the Trustees which the Trustee attends. The Trustees may from time to time
increase the annual administrative fee by such reasonable amounts as the  
circumstances may warrant. The Trustees shall also be entitled to receive 
reasonable remuneration for services rendered to the Trust in any other   
capacity, including services as an agent or employee of the Trust, legal, 
accounting, or other professional services, or otherwise.                 

   6.2 The compensation payable to the Trustees pursuant to the provisions
 of Section 6.1 shall be paid monthly or at such other times as the Trustees
may determine.                                                            

6.3 The Trustees shall be reimbursed from the Trust Estate for all  
expenses reasonably incurred and documented by them in the performance of 
their duties in accordance with this Agreement.                           

7. Distribution to Beneficiaries.                                         

7.1 At least annually, all cash in the Trust Estate, including any  
proceeds from the sale of assets or income from investments, shall be paid
by the Trustees to the Beneficiaries, net of any amounts used to pay      
liabilities or expenses or, based on the Trustees' determination in their 
sole discretion, reserved to pay liabilities or expenses then pending or  
reasonably anticipated.                                                   

    7.2 All distributions to the Beneficiaries shall be made proportionately
based upon their respective Beneficial Interest.                          

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    7.3 The Trustees may withhold from any distribution any amount that they
  determine, in their absolute discretion, should be withheld under applicable
law for taxes or other amounts payable by the Beneficiary entitled to the 
distribution.                                                             

8. Assignment of Right to Distributions.                                  

No Beneficiary may assign or otherwise transfer any rights under this     
Agreement, including any right to distributions, other than by will, the laws   
of descent and distribution, or operation of law. No transfer, by operation of  
law or by reason of death, of the right to distributions or other rights shall  
terminate the Trust under this Agreement or entitle any successor or transferee 
of the Beneficiary to an accounting or to the transfer to it of legal title to  
any part of the Trust Estate.                                                   

9. Concerning The Beneficiaries.                                          

9.1 Evidence of Action by Beneficiaries.                            

     Whenever in this Agreement it is provided that the Beneficiaries may take
  any action (including the making of any demand or request, the giving of any
notice, consent, or waiver, the removal of a Trustee, the appointment of a
 successor Trustee, or the taking of any other action), the fact that at the
time of taking any action such Beneficiaries have joined therein may be   
evidenced (i) by any instrument or any number of instruments of similar   
 tenor executed by Beneficiaries in person or by agent or attorney appointed
in writing or (ii) by the record of the Beneficiaries voting in favor     
thereof at any meeting of Beneficiaries duly called and held in accordance
with section 10.                                                          

9.2 Limitation Upon Suits by Beneficiaries.                         

     No Beneficiary shall have any right under any provision of this Agreement
 to institute any action or proceeding at law or in equity against any party
  other than the Trustees upon or under or with respect to the Trust Estate or
the agreements relating to or forming part of the Trust Estate, and the   
  Beneficiaries do hereby waive any such right. Notwithstanding the foregoing,
such action or proceeding may be brought if Beneficiaries having more than
25% of the total Beneficial Interests in the Trust shall have made written
 request upon the Trustees to institute such action or proceeding in his/her
own name as Trustees hereunder and shall have offered to the Trustees     
reasonable indemnity against the costs and expenses to be incurred therein
 or thereby, and the Trustees shall have failed to institute any such action
  or proceeding within 30 business days after receipt of such notice, request,
and offer of indemnity.                                                   

9.3 Requirement of Undertaking.                                     

   The Trustees may request any court to require, and any court may in its
discretion require, in any suit for the enforcement of any right or remedy
under this Agreement, or in any suit against the Trustees for any action  
taken or omitted by them as Trustees, the filing by any party litigant in 
such suit of an undertaking to pay the costs of such suit, and such court 
may in its discretion assess reasonable costs, including reasonable       
 attorneys' fees, against any party litigant in such suit, having due regard
to the merits and good faith of the claims or defenses made by such party 
 litigant; provided, that the provisions of this Section 9.3 shall not apply
to any suit by the Trustees and such undertaking shall not be requested by
the Trustees or otherwise required in any suit by any Beneficiary or group
of Beneficiaries having more than 10% of the total Beneficial Interests in
the Trust.                                                                

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10. Meetings Of Beneficiaries.                                            

10.1 Purpose of Meetings.                                           

     A meeting of the Beneficiaries may be called at any time and from time to
 time pursuant to this Section 10 for the purpose of taking any action which
the terms of this Agreement permit a Beneficiary having a specified       
aggregate Beneficial Interest to take either acting alone or with the     
Trustees or with any other Beneficiary or Beneficiaries.                  

10.2 Meeting Called by Trustees.                                    

  The Trustees may at any time call a meeting of the Beneficiaries to be
held at such time and at such place within the State of California (or    
  elsewhere if so determined by the Trustees) as the Trustees shall determine.
Written notice of every meeting of the Beneficiaries shall be given by the
 Trustees (except as provided in Section 10.3) stating the time and place of
the meeting and in general terms the action proposed to be taken at the   
meeting, and shall be mailed not more than 60 nor less than 10 days before
the meeting is to be held to all of the Beneficiaries of record not more  
 than 60 days before the date of the meeting, the record date to be fixed by
the Trustees. The notice shall be directed to the Beneficiaries at their  
respective addresses as they appear in the records of the Trust.          

10.3 Meeting Called Upon Requests of Beneficiaries.                 

 Except as provided in this Section 10.3, within 30 days after written
request to the Trustees by Beneficiaries having more than 25% of the total
Beneficial Interests in the Trust to call a meeting of all the            
 Beneficiaries, which written request shall specify in reasonable detail the
 action proposed to be taken, the Trustees shall proceed under the provision
  of Section 10.2 to call a meeting of the Beneficiaries. If the Trustees fail
to call a meeting within the 30-day period, then the meeting may be called
by Beneficiaries having more than 25% of the total Beneficial Interests in
the Trust or by their designated representative or representatives. If the
purpose of the meeting is to fill one or more vacancies in accordance with
Section 5.5, any Beneficiary may make written request to the Trustees to  
call the meeting and the Trustees shall do so forthwith; if there are no  
Trustees, any Beneficiary may call the meeting. If the purpose of the     
meeting is other than to fill one or more vacancies and if there are no   
 Trustees, Beneficiaries having more than 25% of the total Beneficial Voting
Interests in the Trust or their designated representative or              
  representatives, may call the meeting without first applying to the Trustees
or waiting the 30-day period provided for in the first sentence of this   
Section 10.3. Any meeting called by one or more Beneficiaries shall be    
subject to the notice requirements set forth in Section 10.2, and the     
Beneficiary or Beneficiaries calling the meeting shall fix the record date
therefor.                                                                 

10.4 Persons Entitled to Vote at Meeting of Beneficiaries.          

Each Beneficiary on the record date shall be entitled to vote at a  
 meeting of the Beneficiaries either in person or by the Beneficiary's proxy
 duly authorized in writing. The signature of the Beneficiary on the written
authorization need not be witnessed or notarized.                         

10.5 Quorum and Required Vote.                                      

    At any meeting of Beneficiaries, the presence of Beneficiaries having an
aggregate Beneficial Interest sufficient to take action on any matter for 
which the meeting was called shall constitute a quorum. No business may be
transacted in the absence of a quorum. If less than a quorum is present,  
Beneficiaries having a majority of the aggregate Beneficial Interests     
represented at the meeting may adjourn the meeting. Except as otherwise   
  provided in this Agreement, the affirmative vote of holders of a majority of
the Beneficial Voting Interests shall be the act of the Beneficiaries.    

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10.6 Adjournment of Meeting.                                        

 Any meeting of Beneficiaries may be adjourned from time to time and a
  meeting may be held at such adjourned time and place without further notice.

10.7 Conduct of Meetings.                                           

     The Trustees shall appoint the chairman and the secretary of the meeting.
 The vote upon any resolution submitted to any meeting of Beneficiaries need
not be by written ballot.                                                 

10.8 Record of Meeting.                                             

 A record of the proceedings of each meeting of Beneficiaries shall be
prepared by the secretary of the meeting. The record shall be signed and  
verified by the secretary of the meeting and shall be delivered to the    
  Trustees to be preserved by them. Any record so signed and verified shall be
conclusive evidence of all the matters therein stated.                    

11. Amendments.                                                           

11.1 With Consent of Beneficiaries.                                 

     At the direction or with the consent (evidenced in the manner provided in
Section 9.1 hereof) of Beneficiaries having more than 50% of the total    
  Beneficial Voting Interests the Trustees shall promptly amend this Agreement
provided, however, that no such amendment shall be permitted if it will   
allow the Trustees to engage in any activity prohibited by Section 3.2, or
 will adversely affect the Beneficiaries' rights to receive their respective
Beneficial Interests in the Trust Estate.                                 

11.2 Without Consent of Beneficiaries.                              

   The Trustees may from time to time and at any time amend this Agreement
without the consent of the Beneficiaries for the purpose of (a) curing any
ambiguity or correcting or supplementing any provision contained herein or
in any amendment to this Agreement which may be defective or inconsistent 
with any other provision contained herein or in any amendment to this     
Agreement, (b) making such other provisions or modifications in regard to 
matters or questions relating to this Agreement or any amendment hereto,  
provided the same shall not adversely affect the interests of the         
Beneficiaries hereunder, (c) having the Trust continue to qualify as a    
  "liquidating trust" for federal income tax purposes, (d) changing the number
of Trustees, or (e) having the Trust not be subject to the registration   
provisions of the Securities Act of 1933, as amended, or the Securities   
 Exchange Act of 1934, as amended, the qualification provisions of the Trust
Indenture Act of 1939, as amended, or the registration provisions of the  
Investment Company Act of 1940, as amended.                               

11.3 Notice and Effect of Amendment.                                

   Promptly after the execution by the Trustees of any such amendment, the
Trustees shall give notice of the substance of such amendment to the      
Beneficiaries or, in lieu thereof, the Trustees may send a copy of the    
amendment to each Beneficiary. Upon the execution of any amendment by the 
Trustees, this Agreement shall be deemed to be modified and amended in    
accordance therewith and the respective rights, limitations of rights,    
obligations, duties, and immunities of the Trustees and the Beneficiaries 
  under this Agreement shall thereafter be determined, exercised, and enforced
hereunder subject in all respects to such modification and amendment, and 
all the terms and conditions of any such amendment shall be thereby deemed
to be part of the terms and conditions of this Agreement for any and all  
purposes.                                                                 

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12. Termination.                                                          

     12.1 This Agreement and the Trust created hereby shall terminate upon the
final distribution by the Trustees of all property constituting the Trust 
  Estate, which final distribution shall occur by a date that is not more than
three years from the Effective Date. If, however, circumstances exist that
prevent the Trustees from effecting a final distribution during the       
aforementioned term of the Trust with respect to certain assets, then in  
order to dispose of those assets and effect the final distribution to the 
Beneficiaries, the Trustees may extend the term of the Trust, with respect
to such assets only, for a period that is reasonably necessary under the  
circumstances and does not exceed 24 months from the third anniversary of 
  this Agreement. Such circumstances would exist, for example, because (i) the
delays, difficulties, and uncertainties inherent in prosecuting or        
negotiating a settlement of any then pending infringement claims with     
respect to the IP may impede the final resolution or disposition of those 
claims; or (ii) certain assets received in the course of resolving        
infringement claims of the Trust Estate may not be susceptible to         
  distribution in kind to the Beneficiaries (or readily exchanged for property
susceptible to distribution in kind) or readily sold for cash at a price  
that is fair and that does not reflect a potential third-party purchaser's
undervaluation of said assets based on, for example, the impending        
termination of the Trust.                                                 

     12.2 Except as otherwise specifically provided herein, upon the discharge
of all liabilities of the Trust and final distribution of all of the Trust
 Estate, the Trustees shall have no further duties or obligations hereunder.

13. Protection of Persons Dealing With The Trustee.                       

13.1 Reliance Upon Acts of Trustees.                                

   Any act of the Trustees purporting to be done in their capacity as such
shall, as to any persons dealing with the Trustees, be conclusively deemed
to be within the purpose of this Trust and within the powers of the       
Trustees. As to any matter requiring or involving action by the           
  Beneficiaries, any person dealing with the Trustees shall be fully protected
in relying upon the Trustees' certificate setting forth the facts.        

13.2 Application of Money Paid or Transferred to Trustees.          

No person dealing with the Trustees shall be required to follow the 
application by the Trustees of any money or property which may be paid or 
transferred to the Trustees. The receipt of the Trustees, or of authorized
  agents or representatives of the Trust, for money or other property shall be
binding upon the Trust.                                                   

14. Miscellaneous.                                                        

14.1 This Agreement is not intended to create and shall not be      
interpreted as creating an association, corporation, partnership or joint 
 venture of any kind, or any other profit-making business or enterprise. The
 Trust established hereby is intended as a liquidating trust, to be governed
and construed in all respects as a trust without transferable shares or   
interests.                                                                

14.2 OPTi shall not have or incur any obligation or liability to any
other person on account of any error in judgment or any act or failure to 
  act by the Trustees, the Beneficiaries, or any other person dealing with the
Trust or the Trust Estate.                                                

14.3 The Trustees shall not incur any obligation or liability to any
 other person in connection with the transfer by OPTi to the Trustees of the
Trust Estate, and no delegation of duty of performance to the Trustees or 
assumption of liabilities of OPTi by the Trustees is intended by this     
Agreement.                                                                

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14.4 Notices to the Trustees shall be in writing and shall be deemed
  given if delivered personally or mailed by certified mail to the Trustees at
the following addresses:                                                  

            __________________________________________________________________
            __________________________________________________________________
            __________________________________________________________________
            __________________________________________________________________

with a copy to:                                                         

Richard A. Peers, Esq.                                
Heller Ehrman White & McAuliffe LLP                   
275 Middlefield Road                                  
Menlo Park, CA 94025                                  

14.5 Any notice or other communication by the Trustees to any       
Beneficiaries shall be deemed to have been sufficiently given, for all    
 purposes, if given by being deposited, postage prepaid, in a post office or
letter box addressed to such person at the address shown in the records of
the Trust.                                                                

14.6 This Agreement contains a complete statement of all of the     
arrangements between the parties with respect to its subject matter and no
amendment, termination, or waiver of any provision of this Agreement prior
  to the Effective Date shall be effective unless in writing and signed by the
 parties to this Agreement. Following the Effective Date, this Agreement may
be amended pursuant to Section 11 hereto.                                 

    14.7 Except as provided in this Agreement, the rights and obligations of
the Trustees under this Agreement shall not be assignable, voluntarily,   
  involuntarily, or by operation of law, and any purported assignment shall be
void.                                                                     

14.8 This Agreement shall be governed by the law of the State of    
 California applicable to agreements made and to be performed in California.

14.9 This Agreement shall be filed in such governmental office or   
offices, if any, and in such other office or offices as the Trustees may  
determine to be necessary or desirable. A copy of this Agreement and all  
  amendments thereof shall be filed in the office of the Trustees and shall be
available at reasonable times and upon reasonable prior notice for        
inspection by any Beneficiary or his/her duly authorized representative.  

     14.10 The Company and those persons who have the right and power to do so
 after the Company's corporate existence terminates will, upon the Trustees'
  reasonable request, execute, acknowledge and deliver any further instruments
and do any further acts that may be necessary or proper to carry out      
effectively the purposes of this Agreement, to transfer any property      
intended to be conveyed hereby and the assumption of all liabilities and  
obligations pertaining thereto, and to perfect the Trustees' title to, and
to vest in the Trustees, and their successors or assigns, the property,   
powers, instruments, and funds in trust under this Agreement.             

  14.11 If any provision of this Agreement or the application thereof to
any person or circumstance shall be finally determined to be invalid or   
unenforceable to any extent, the remainder of this Agreement, or the      
application of such provision to persons or circumstances other than those
as to which it is determined to be invalid or unenforceable, shall not be 
affected thereby, and each provision of this Agreement shall be valid and 
enforced to the fullest extent permitted by law.                          

    14.12 This Agreement may be executed in any number of counterparts, each
 of which when so executed shall be an original, and all of which when taken
together shall constitute this Agreement.                                 

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14.13 Unless otherwise indicated, a reference in this Agreement to a
Section is to a Section of this Agreement. The Section headings contained 
herein have been inserted for convenience and reference only and shall not
be construed to affect the meaning, construction, or effect of this       
Agreement.                                                                

IN WITNESS WHEREOF, the Company and the Trustees have executed this       
Agreement on the date first set forth above.                                    

             OPTi Inc.

       By:
                                             -----------------------------------
               Name:
                Title:

Trustees                                                                        

By:                                                                             
----------------------------------                                        
Name: Stephen A. Dukker                                                   
Title:                                                                    

By:                                                                             
----------------------------------                                        
Name: Kapil K. Nanda                                                      
Title:                                                                    

By:                                                                             
----------------------------------                                        
Name: William H. Welling                                                  
Title:                                                                    

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================================================================================

 PROXY

 OPTi Inc.

 PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

    The undersigned shareholder of OPTi Inc. (the "Company"), hereby
     appoints Bernard T. Marren and Michael Mazzoni and each of them, with power
     of substitution to each true and lawful attorneys, agents, and proxyholders
 of the undersigned and hereby authorizes them to represent and vote, as
   specified herein, all shares of common stock of the Company to be held of
     record by the undersigned on December 7, 2001 at the 2001 Annual Meeting of
  Shareholders of the Company to be held on January 11, 2002 at 9:00 a.m.,
  local time, at the offices of Heller Ehrman White & McAuliffe LLP at 275
Middlefield Road, Menlo Park, CA, 94025 and any adjournments or       
postponement thereof.                                                 

     --------------                                               --------------
  SEE REVERSE             CONTINUED AND TO BE SIGNED           SEE REVERSE
SIDE                            ON REVERSE SIDE              SIDE     
     --------------                                               --------------

[x]  Please mark votes as in this example                             

    The shares represented by this proxy will be voted in the manner directed.
     In the absence of any direction, the shares will be voted FOR Proposal 1, 2
     and 3. The undersigned acknowledges receipt of the Notice of Annual Meeting
of Shareholders and Proxy Statement dated December __, 2001.          

PROPOSAL 1--Approval and adoption of the voluntary Plan of Complete Liquidation 
and Dissolution of OPTi Inc. including the establishment of the OPTi Inc.       
Liquidating Trust.                                                              

   [ ]  FOR PROPOSAL 1    [ ] AGAINST PROPOSAL 1   [ ] ABSTAIN ON PROPOSAL 1

Our Board of Directors unanimously recommends a vote for the approval of        
Proposal 1.                                                                     

PROPOSAL 2--Approval and Appointment of Stephen A. Dukker, Kapil K. Nanda and   
William H. Welling as the trustees of the OPTI Inc. Liquidating Trust.          

   [ ]  FOR PROPOSAL 2    [ ] AGAINST PROPOSAL 2   [ ] ABSTAIN ON PROPOSAL 2

Our Board of Directors unanimously recommends a vote for the approval of        
Proposal 2.                                                                     

PROPOSAL 3--Election of Directors                                               

[ ] FOR all nominees listed below                                     

[ ] WITHHOLD authority to vote for all nominees listed below          

 To withhold authority to vote for any individual nominee, strike a line
through the nominee's name in the list below:                         

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Bernard T. Marren                                                     
Stephen A. Dukker                                                     
Kapil K. Nanda                                                        
William H. Welling                                                    

Our Board of Directors unanimously recommends a vote for each of the nominees   
                             ---
named above.                                                                    

PROPOSAL 4--To ratify the appointment of Ernst & Young LLP as the independent   
accountants of the Company for the fiscal year ending December 31, 2001.        

    [ ] FOR PROPOSAL 4     [ ] AGAINST PROPOSAL 4    [ ] ABSTAIN ON PROPOSAL 4

Our Board of Directors unanimously recommends a vote for the approval of        
                             ---
Proposal 4.                                                                     

and, in their discretion, upon such other matter or matters that may properly   
come before the meeting and any postponement(s) or adjournment(s) thereof.      

      PLEASE SIGN ON REVERSE SIDE AND RETURN IMMEDIATELY

     ===========================================================================

\    THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY DIRECTION IS       
   INDICATED, WILL BE VOTED AS FOLLOWS: (1) FOR THE APPROVAL AND ADOPTION OF
   THE LIQUIDATION PLAN AND DISSOLUTION OF OPTi; (2) FOR THE APPROVAL OF THE
   APPOINTMENT OF THE THREE TRUSTEES OF THE OPTi INC. LIQUIDATING TRUST; (3)
     FOR THE RE-ELECTION OF 4 DIRECTORS; (4) FOR RATIFICATION OF THE APPOINTMENT
    OF ERNST & YOUNG LLP AS THE INDEPENDENT ACCOUNTANTS OF OPTi FOR THE FISCAL
   YEAR ENDING DECEMBER 31, 2001; AND AS SAID PROXIES DEEM ADVISABLE ON SUCH
OTHER MATTERS AS MAY COME BEFORE THE MEETING.                         

     ===========================================================================
                                 Date:
Signature                                                             

     ===========================================================================

                                 Date:
Signature                                                             

   (This Proxy should be marked, dated, signed by the shareholder(s) exactly
  as his or her name appears hereon, and returned promptly in the enclosed
  envelope. Persons signing in a fiduciary capacity should so indicate. If
shares are held by joint tenants or as community property, both should
sign.)                                                                

     ===========================================================================

Dates Referenced Herein   and   Documents Incorporated by Reference

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