STANDBY AGREEMENT

ADVANCED MICRO DEVICES, INC.

Depositary Shares Each Representing
1/10th of a Share of $30.00 Convertible
Exchangeable Preferred Shares


STANDBY AGREEMENT
-----------------

February 10, 1995

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
SALOMON BROTHERS INC
c/o Donaldson, Lufkin & Jenrette
Securities Corporation
140 Broadway
New York, New York 1005

Dear Sirs:

1. Introductory.
------------

Advanced Micro Devices, Inc., (the "Company") proposes to call for
redemption on March 13, 1995 (the "Redemption Date"), all of its outstanding
Depositary Shares (the "Depositary Shares"), each representing ownership of one-
tenth of a share of the Company's $30.00 Convertible Exchangeable Preferred
Shares (the "Preferred Shares"), at the redemption price to be paid by the
Company of $50.90 per Depositary Share plus unpaid dividends thereon in the
amount of $0.73 per Depositary Share to the Redemption Date for a total
redemption price of $51.63 per Depositary Share (the "Redemption Price"). The
holder of any Depositary Share may, at any time prior to 5:00 p.m., New York
City time (the "Close of Business") on the Redemption Date, but not thereafter,
surrender depositary receipts representing one or more whole Preferred Shares to
convert such Preferred Shares into shares of Common Stock, $.01 par value per
share, of the Company ("Common Stock") at the rate of 1.9873 shares of Common
Stock for each Depositary Share (the "Conversion Ratio"). No payment or
adjustment in respect of accrued and unpaid dividends on the Depositary Shares
will be made upon conversion. In the event that fewer than all of the
outstanding Depositary Shares are surrendered for conversion prior to the
Redemption Date, the Company desires to make arrangements with you (collectively
the "Purchasers" and each a "Purchaser"), pursuant to which the Purchasers will
purchase directly from the Company up to such whole number of shares of Common
Stock as would have been issuable upon conversion of any Depositary Shares not
surrendered for conversion prior to the Close of Business on the Redemption Date
(such Depositary Shares being referred to herein as the "Depositary Shares To Be
Redeemed").

2. Representations and Warranties of the Company.
---------------------------------------------

The Company represents, warrants and covenants to the Purchasers that:

(a) The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission") in accordance with the Securities Act of
1933, as amended (the "Act" or the "Securities Act"), and the rules and
regulations of the Commission promulgated thereunder (the "Rules and
Regulations"), a registration statement on Form S-3, including a related
prospectus, relating to the maximum number of shares of Common Stock (a) to be
purchased by you, pursuant to Section 3(a) below and (b) to be received upon
conversion of Depositary Shares (if any) purchased by you pursuant to Section
3(b) below. As used in this Agreement, the term "Registration Statement" means
such registration statement, including exhibits and financial statements and
schedules and all documents incorporated therein by reference, as amended (if
amended) when it becomes effective, and the term "Prospectus" means such
prospectus in the form filed on behalf of the Company with the Commission
pursuant to Rule 424(b) under the Act. Any reference herein to the Prospectus
shall be deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Act, as of the date of such
Prospectus, and any reference to any amendment or supplement to the Prospectus
shall be deemed to refer to and include any documents filed after such date
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
so incorporated by reference.

(b)(i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Registration Statement and
Prospectus complied, or will comply when so filed, in all material respects with
the Exchange Act and the applicable rules and regulations of the Commission
thereunder, (ii) each part of the Registration Statement, when such part became
effective, did not contain and each such part, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, (iii) the Registration Statement and the
Prospectus comply and, as amended or supplemented, if applicable, will comply in
all material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder and (iv) the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that the representations and warranties
set forth in this Section 2(b) do not apply to statements in or omissions from
the Registration Statement or the Prospectus based upon information relating to
the Purchasers furnished to the Company in writing by you expressly for use
therein.

(c) As of the Close of Business on February 9, 1995, 3,448,620
Depositary Shares were outstanding, and the Company has duly authorized the
redemption of all the outstanding Depositary Shares on the Redemption Date at
the Redemption Price. The Company has duly called the Depositary Shares for
redemption on the Redemption Date in

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accordance with the terms of the Deposit Agreement, dated as of March 25, 1987
(the "Deposit Agreement"), among the Company, Bank of America National Trust and
Savings Association (subsequently replaced by the First National Bank of Boston,
and hereinafter the "Depositary") and the holders of the Depositary Shares,
which governs the Depositary Shares.

(d) The Depositary Shares are convertible into Common Stock at the
Conversion Ratio by surrender of depositary receipts representing one or more
whole Preferred Shares to the Depositary, prior to the Close of Business on the
Redemption Date.

(e) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has all requisite corporate power and authority to own its
property and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole.

(f) Each subsidiary of the Company (i) identified on Exhibit A hereto
or (ii) which constitutes a "significant subsidiary" within the meaning of Rule
1-02 of Regulation S-X (in each case, individually a "Material Subsidiary" and,
collectively, the "Material Subsidiaries") has been duly incorporated, is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has all requisite corporate power and
authority to own its property and to conduct its business and is duly qualified
to transact business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.

(g) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.

(h) The shares of capital stock of the Company outstanding prior to
the redemption and conversion of the Depositary Shares and the offer and sale of
the Shares (as defined in Section 3(b) below) have been duly authorized and are
validly issued, fully paid and non-assessable and the holders of such shares are
not entitled to any preemptive or other similar right.

(i) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of the Shares will not
be subject to any preemptive or similar rights.

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(j) This Agreement has been duly authorized, executed and delivered by
the Company and is a valid and binding agreement of the Company.

(k) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement will not contravene any
provision of applicable law or the certificate of incorporation or by-laws of
the Company or constitute a breach of, or default under, any agreement or other
instrument binding upon the Company or any of its Material Subsidiaries or to
which any of its or their properties are subject that is material to the Company
and its subsidiaries, taken as a whole, or any material judgment, order or
decree of any governmental body, agency or court having jurisdiction over the
Company or any Material Subsidiary or any of their properties and no consent,
approval, authorization or order of, or qualification or filing with, any
governmental body or agency is required for the performance by the Company of
its obligations under this Agreement, except such as may be required by the
securities or Blue Sky laws of the various states in connection with the offer
and sale of the Shares.

(l) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and its subsidiaries, taken as a whole, from that set forth in the
Prospectus.

(m) There are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened to which the Company or any of its Material
Subsidiaries is a party or to which any of the properties of the Company or any
of its Material Subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not so described or any
statutes, regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not described or filed as
required.

(n) Each of the Company and its Material Subsidiaries has all
necessary consents, authorizations, approvals, orders, certificates and permits
of and from, and has made all declarations and filings with, all federal, state,
local and other governmental authorities, all self-regulatory organizations and
all courts and other tribunals, to own, lease, license and use its properties
and assets and to conduct its business in the manner described in the
Prospectus, except to the extent that the failure to obtain or file would not
have a material adverse effect on the Company and its subsidiaries, taken as a
whole.

(o) Each preliminary prospectus to be filed as part of the
registration statement as originally filed or as part of any amendment thereto,
or to be filed pursuant to Rule 424 under the Securities Act, will comply when
so filed in all material respects with the Securities Act and the rules and
regulations of the Commission thereunder.

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(p) The Company is not an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.

(q) Except as disclosed in the Prospectus, the Company and its
Material Subsidiaries are (i) in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws"), (ii) have received
all permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are in
compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals would not,
singly or in the aggregate, have a material adverse effect on the Company and
its subsidiaries, taken as a whole.

(r) The Company has not paid or given and will not pay or give,
directly or indirectly, any commission or other remuneration for soliciting
conversions of Depositary Shares into shares of Common Stock other than in
accordance with this Agreement.

(s) The Company has neither taken nor will take, directly or
indirectly, any action designed to cause or result in or that has constituted or
that might reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the
conversion of the Preferred Stock.

3. Purchase and Conversion of the Depositary Shares.
------------------------------------------------

(a) On the basis of the representations and warranties herein
contained, but subject to the terms and conditions herein set forth, each
Purchaser agrees, severally and not jointly, to purchase from the Company, at a
price (the "Purchase Price") per share of $25.98, 50% of such number of shares
of Common Stock as would have been issuable upon conversion of the Depositary
Shares To Be Redeemed (such shares of Common Stock being referred to herein as
the "Standby Stock").

(b) Until the Close of Business on the Redemption Date, each Purchaser
may (but will not be obligated to) purchase Depositary Shares in the open market
in such amounts and at such prices as it deems advisable. On the basis of the
representations, warranties and agreements herein set forth, each Purchaser
agrees to surrender for conversion into Common Stock, at or prior to the Close
of Business on the Redemption Date, all Depositary Shares so purchased by the
Purchasers in the open market. The Shares of Common Stock to be received upon
the conversion of the Depositary Shares pursuant to this Section 3(b) are
referred to herein as the "Open Market Stock." The Standby Stock and the Open
Market Stock are herein referred to collectively as the "Shares."

5

(c) In the event that less than 342,672 shares of Common Stock are
acquired by the Purchasers pursuant to Section 3(a) hereof, the Purchasers shall
remit to the Company 50% of the Profit (as defined below) received. In the
event that the number of shares of Common Stock acquired by the Purchasers
pursuant to Section 3(a) hereof is equal to or exceeds 342,672, the Purchasers
shall not be required to remit to the Company any of the Profit received. As
used in the herein, "Profit" means the excess of the aggregate gross proceeds
received on the sale by Purchasers of such Shares over the aggregate price of
such shares paid by Purchasers therefor, after deduction from such proceeds of
sale of any transfer taxes and other related expenses not reimbursed by the
Company or any unaffiliated party. For purposes of the foregoing determination,
any such Shares not sold by Purchasers prior to the Close of Business on the
30th day (or, if such 30th day is not a business day, the next business day
thereafter) after the Redemption Date shall be deemed to have been sold on such
day for an amount equal to the average of the high and low sale price of the
Common Stock on such day as reported on the New York Stock Exchange. Upon
completion of the sale of such Shares, each Purchaser shall furnish to the
Company a statement setting forth the aggregate proceeds received on the sale
thereof and the applicable selling concessions, transfer taxes and other related
expenses. Nothing contained herein shall limit the right of the Purchasers, in
their discretion, to determine the price or prices at which, or the time or
times when, any Shares of Common Stock shall be sold, whether or not prior to
the Redemption Date and whether or not for long or short account. Settlement of
the profit sharing arrangement set forth in this Section 3(c) shall occur as
soon as practicable after the final disposition (or deemed disposition) by the
Purchasers of all of the Shares.

(d) The Company understands that the Purchasers propose to sell the
shares of the Standby Stock and the Open Market Stock as soon as practicable
after the date hereof. The Company confirms that the Purchasers and dealers
have been authorized to distribute the Prospectus (as amended or supplemented if
the Company furnishes amendments or supplements to the Purchasers).

4. Payment, Delivery and Fees.
--------------------------

(a) Fees. As compensation for your commitments as Purchasers, the
----
Company will pay to the Purchasers, collectively, (i) an amount (the "Standby
Fee") equal to Two Million Six Hundred Seventy-One Thousand Three Hundred and
One Dollars ($2,671,301) and (ii) an additional amount (the "Take-Up Fee") equal
to One Dollar and Fifty Cents ($1.50) per share of Standby Stock. The Take-Up
Fee shall not be deemed to be Profit under Section 3(c) hereof. Payment of the
Standby Fee shall be made on Closing Date I, which shall be the Redemption Date
unless the parties hereto otherwise agree. Payment on the Take-Up Fee, if any,
shall be made, as due, on Closing Date I or Closing Date II (which shall be the
business day immediately following the Redemption Date) unless the parties
hereto otherwise agree.

(b) Payment on Closing Date I. Promptly after the Close of Business
-------------------------
on the day immediately preceding Closing Date I, the Company shall notify the
Purchasers in

6

writing after conferring with the Depositary of (i) the number of Depositary
Shares surrendered for redemption as of the Close of Business on such day, (ii)
the related number of shares of Standby Stock as of the Close of Business on
such day and (iii) the amount of the Take-Up Fee, if any, payable in light of
such number of shares of Standby Stock.

At or prior to 12:00 noon, New York City time, on the Redemption Date
(i) the Company will pay to the Purchasers by wire transfer of immediately
available funds an amount equal to (A) the Standby Fee and (B) the Take-Up Fee,
if any, payable in light of the number of shares of Standby Stock being
purchased on such date and (ii) the Purchasers will arrange for the deposit with
the Company by wire transfer of immediately available funds, and provide the
Company with a federal funds reference number in respect of such deposit with
the Company, an amount equal to the product of (A) the number of shares of
Standby Stock as contained in the written notification sent by the Company
pursuant to this Section 4(b) and (B) the Purchase Price.

(c) Payment on Closing Date II. Promptly after the Close of Business
--------------------------
on the Redemption Date, the Company shall notify the Purchasers in writing after
conferring with the Depositary of (i) the number of Depositary Shares
surrendered for redemption on the Redemption Date, (ii) the number of Depositary
Shares which have been converted on the Redemption Date, (iii) the number of
Depositary Shares which have not been surrendered for redemption or conversion
as of the Close of Business on the Redemption Date, (iv) the total number of
shares of Standby Stock as of the Close of Business on the Redemption Date and
(v) the total amount of the Take-Up Fee, if any.

At or prior to 12:00 noon, New York time, on Closing Date II (i) the
Company will pay to the Purchasers by wire transfer of immediately available
funds an amount equal to the Take-Up Fee, if any, payable in light of the number
of shares of Standby Stock being purchased on such date and (ii) the Purchasers
shall arrange for the deposit by wire transfer of immediately available funds,
and provide the Company with a federal funds reference number in respect of such
deposit with the Company, an amount equal to the product of (A) the shares of
Standby Stock to be purchased on such date and (B) the Purchase Price.

(d) Delivery of Shares. The Company will, on the second business day
------------------
following receipt by the Company of a notice hereinafter referred to, deliver to
the Purchasers at the above address (or as the Purchasers may otherwise
designate in writing) certificates evidencing shares of Standby Stock acquired
by the Purchasers under Section 3(c), in definitive form and in such
denominations and registered in such names as the Purchasers shall request by
written notice to the Company.

5. Covenants of the Company.
------------------------

The Company agrees with the Purchasers that:

7

(a) The Company will notify you promptly, and (if requested by you)
will confirm such notification in writing, (i) when any post-effective amendment
to the Registration Statement becomes effective, (ii) of any request by the
Commission for amendments or supplements to the Registration Statement or the
Prospectus or for additional information, (iii) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for such purpose, and (iv) of the
happening of any event during the period mentioned in paragraph (d) below which
in the judgment of the Company makes any statement made in the Registration
Statement or the Prospectus untrue or which requires the making of any changes
in the Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any order
suspending the effectiveness of the Registration Statement, the Company will use
its best efforts to obtain the withdrawal of such order at the earliest possible
moment.

(b) The Company will furnish to you, without charge, two signed copies
of the Registration Statement and any post-effective amendment thereto,
including exhibits and financial statements and schedules and all documents
incorporated therein by reference to the extent not previously furnished to you.

(c) The Company will give you advance notice of its intention to file
any amendment or supplement to the Registration Statement as filed or any
amendment or supplement to the Prospectus, and will not file any such amendment
or supplement to which you shall reasonably object in writing; provided,
however, that you shall respond promptly to any such amendment or supplement
that constitutes a filing on Form 8-K or Form 10-Q under the Exchange Act. In
addition to, and without limiting, the foregoing, the Company will file under
the Exchange Act, on or before March 6, 1995, the Company's Annual Report on
Form 10-K for the fiscal year ended December 25, 1994 (the "1994 10-K"), which
Form 10-K shall be satisfactory in form and substance to you in the exercise of
your discretion.

(d) The Company will deliver to you or upon your order, without
charge, as many copies of the Prospectus or any amendment or supplement thereto,
and any documents incorporated therein by reference, as you may reasonably
request. The Company consents to the use of the Prospectus or any amendment or
supplement thereto by you and by all dealers to whom the Shares may be sold,
both in connection with the offering or sale of the Shares and for such period
of time as the Prospectus is required to be delivered under the Act. If during
such period of time any event of the type described in Section 5(a) or any other
event shall occur as a result of which, in the good faith opinion of your
counsel, the Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to supplement or
amend the Prospectus to comply with law, the Company will forthwith prepare and
duly file with the Commission an appropriate supplement or amendment thereto
which will correct such statement or omission or an

8

amendment which will effect such compliance, or forthwith will file all reports
and any definitive proxy statement or information statement required to be filed
by the Company with the Commission pursuant to Section 13, 14, or 15 of the
Exchange Act subsequent to the date of the Prospectus, and will deliver to you,
without charge, such number of copies thereof as you may reasonably request.

(e) The Company will cooperate with you and your counsel in connection
with the registration or qualification of the Shares for offer and sale and
their eligibility for investment under the securities or Blue Sky laws of such
jurisdictions as you request. The Company will pay all fees and expenses
(including fees and expenses of counsel) relating to such qualification under
such securities or Blue Sky laws.

(f) The Company will make generally available to its security holders
an earnings statement covering a period of at least twelve months beginning
after the effective date of the Registration Statement as soon as is reasonably
practicable but in any event not later than 90 days after the end of such
period, which earnings statement shall satisfy the provisions of Section 11(a)
of the Act and the rules thereunder.

(g) The Company will cause to be mailed by first-class mail, postage
prepaid, to holders of Depositary Shares on February 10, 1995 and thereafter
cause to be mailed to such holders, as often as you may reasonably request, a
notice of redemption (the "Notice of Redemption") of all of the Depositary
Shares on the Redemption Date in accordance with the requirements of the Deposit
Agreement and the Certificate of Designation and in the form submitted to you,
together with a copy of the Prospectus and a letter of transmittal and will
furnish copies thereof as you may request.

(h) The Company agrees to publish advertising mutually satisfactory to
the Purchasers and the Company relating to the redemption.

(i) The Company will pay all costs and expenses in connection with (i)
the preparation, printing and filing of the Registration Statement, the
Prospectus and the Blue Sky survey, (ii) the issuance of the Shares and the
delivery of the certificates evidencing the Shares (other than transfer taxes on
resales), (iii) the preparation, printing, reproduction and execution of this
Agreement, the Notice of Redemption, the letter of transmittal and related
documents, (iv) the printing and publishing of any newspaper notice of the call
for redemption contemplated hereby and any advertising pursuant to Section 5(h)
hereof and (v) furnishing such copies of the Registration Statement and the
Prospectus, and all amendments and supplements thereto, as may be requested for
use in connection with the offering and sale of the Shares by you or by dealers
to whom the Shares may be sold. The Company will also pay all out-of-pocket
expenses which you may incur, including, but not limited to, the reasonable fees
and expenses of your counsel in connection with the transactions contemplated
hereby (A) if the transactions contemplated hereby are consummated and (B) if
the transactions contemplated hereby are not consummated because any condition
to the obligations of the Purchasers set forth in Section 6 hereof is not
satisfied, if this Agreement

9

is terminated pursuant to Section 9 or because of any refusal, inability or
failure on the part of the Company to perform any agreement herein or comply
with any provision hereof other than by reason of default by the Purchasers.

(j) The Company agrees that until 180 days after the Redemption Date
without your prior written consent it will not offer, sell, contract to sell or
otherwise dispose of any shares of Common Stock or any securities convertible
into, or exercisable or exchangeable for, Common Stock, other than the Shares
and other than (i) any shares of Common Stock sold upon the exercise of an
option or warrant or the conversion or exchange of a security outstanding on the
date hereof and (ii) any shares of Common Stock sold pursuant to existing
employee benefit plans of the Company. However, if it shall be determined that
the number of shares of Standby Stock to be purchased hereunder is fewer than
350,000 shares, these restrictions shall terminate at the Close of Business on
the second business day following the Redemption Date.

(k) The Company will direct the Depositary in writing to advise you
daily of the number of Depositary Shares surrendered for redemption or
conversion by the Close of Business on each such day.

(l) Until the earlier of the date you have sold all the Shares and
June 15, 1995, the Company will (i) notify you promptly of any material change
affecting any of its representations, warranties, agreements or indemnities
herein and will take such steps as you may reasonably request to remedy and/or
publicize the same and (ii) furnish you such other information concerning the
Company as you may reasonably request.

6. Conditions of the Obligations of the Purchasers.
-----------------------------------------------

The obligations of the Purchasers hereunder are subject to the
condition that the Registration Statement shall have become effective not later
than February 10, 1995 or such later date as shall have been consented to by
you.

The obligations of the Purchasers hereunder are subject to each of the
following further conditions:

(a) Subsequent to the execution and delivery of this Agreement and
prior to the Redemption Date or Closing Date II, as the case may be, there shall
not have occurred and in your opinion it shall not be likely to occur any of the
following that, in your good faith judgment, is material and adverse and that
makes it, in your good faith judgment, impracticable to market the Shares on the
terms and in the manner contemplated by the Prospectus: (i) any change, or any
development involving a prospective change, in the condition, financial or
otherwise, or in the earnings, business or operations, of the Company and its
subsidiaries, taken as a whole, from that set forth in the Registration
Statement; or (ii) any enactment, publication, decree or other promulgation of
any federal or state statute,

10

regulation, rule or order of any court or other governmental authority which
affects, or may affect, the business or operations of the Company.

(b) The Purchasers shall have received on the date hereof and on each
Closing Date a certificate, dated the date of its delivery and signed by an
executive officer of the Company, not in his individual capacity but solely in
his capacity as an executive officer of the Company, to the effect that the
representations and warranties of the Company contained in this Agreement are
true and correct as of the date of such certificate and that the Company has
complied with all of the agreements and satisfied all of the conditions on its
part to be performed or satisfied hereunder on or before the date of such
certificate.

The officer signing and delivering such certificate may rely upon the
best of his knowledge as to proceedings threatened.

(c) You shall have received on the date hereof and on each Closing
Date an opinion of Bronson, Bronson & McKinnon, counsel for the Company, dated
the date of its delivery, to the effect that

(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of Delaware,
has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each
jurisdiction which requires such qualification wherein it owns or
leases any properties or conducts any business, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries
taken as a whole;

(ii) each Material Subsidiary is a corporation (or, in the
case of AMD (Thailand) Ltd. and Advanced Micro Devices (Singapore)
Pte. Ltd., a limited liability company and a private limited company,
respectively) duly organized and validly existing, has the power and
authority to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business and is in
good standing in each jurisdiction which requires such qualification
wherein it owns or leases any properties or conducts any business,
except to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the Company and
its subsidiaries taken as a whole;

(iii) the authorized capital stock of the Company conforms
in all material respects as to legal matters to the description
thereof contained in the Prospectus;

(iv) the shares of capital stock of the Company
outstanding prior to the offer and sale of the Shares have been duly
authorized and are

11

validly issued, fully paid and non-assessable and the holders of such
shares are not entitled to any preemptive or other similar right;

(v) the Shares have been duly authorized and, when issued
and delivered in accordance with the terms of this Agreement, will be
validly issued, fully paid and non-assessable, and the issuance of
such Shares will not be subject to any preemptive or similar right;

(vi) this Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of the
Company, except as rights to indemnity or contribution hereunder may
be limited under applicable law;

(vii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene any provision of applicable law or the certificate
of incorporation or by-laws of the Company or, to the best of such
counsel's knowledge, any agreement or other instrument binding upon
the Company or any of its Material Subsidiaries that is material to
the Company and its subsidiaries, taken as a whole, or, to the best of
such counsel's knowledge, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Company or any Material Subsidiary which is material to the Company
and its subsidiaries, taken as a whole, and no consent, approval,
authorization or order of, or qualification with, any governmental
body or agency is required for the performance by the Company of its
obligations under this Agreement except for the order of the
Securities and Exchange Commission declaring the Registration
Statement effective which has been obtained, and except such as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares by the Purchasers;

(viii) the statements (1) in the Prospectus under the
captions "Description of Capital Stock" and "Standby Arrangement" and
(2) in the Registration Statement in Item 15, in each case insofar as
such statements constitute summaries of the legal matters, documents
or proceedings referred to therein, fairly present the information
called for with respect to such legal matters, documents and
proceedings and fairly summarize the matters referred to therein;

(ix) to the best of such counsel's knowledge there are no
(A) legal or governmental proceedings pending to which the Company or
any of its Material Subsidiaries is a party or to which any of the
properties of the Company or any of its Material Subsidiaries is
subject other than as described in the Registration Statement or the
Prospectus and other than litigation which

12

individually or in the aggregate is not material to the Company and
its subsidiaries taken as a whole; or (B) statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement that are not described or filed as
required; and (C) legal or governmental proceedings threatened or
contemplated by any governmental agency or threatened by others which
are required to be described in the Prospectus; and

(x) such counsel (1) is of the opinion that each
document, if any, filed pursuant to the Exchange Act and incorporated
by reference in the Registration Statement and the Prospectus (except
for financial statements, including the notes and schedules thereto,
and financial data, as to which such counsel need not express any
opinion) complied when so filed as to form in all material respects
with the Exchange Act and the rules and regulations of the Commission
thereunder, (2) is of the opinion that the Registration Statement, and
Prospectus (except for financial statements, including the notes and
schedules thereto, and financial data included therein as to which
such counsel need not express any opinion) comply as to form in all
material respects with the Securities Act and the rules and
regulations of the Commission thereunder, (3) has no reason to believe
that (except for financial statements, including the notes and
schedules thereto, and financial data included therein as to which
such counsel need not express any belief) the Registration Statement
and the Prospectus included therein at the time the Registration
Statement became effective contained any untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading and (4) has no reason to believe that (except for financial
statements, including the notes and schedules thereto, and financial
data included therein, as to which such counsel need not express any
belief) the Prospectus contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading.

In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States, the
General Corporation Law of the State of Delaware and the laws of the State of
California, to the extent such counsel deems proper and to the extent specified
in such opinion, upon an opinion or opinions (in form and substance reasonably
satisfactory to counsel for the Purchaser) of other counsel reasonably
acceptable to counsel for the Purchasers, familiar with the applicable laws; (B)
as to matters of fact, to the extent they deem proper, on certificates of
responsible officers of the Company or of any of its subsidiaries (including
certificates as to the materiality of any contracts or judgments) and (C) to the
extent they deem proper, upon written statements or certificates of officers of
departments of various jurisdictions having custody of documents respecting the
corporate existence or good standing of the Company or of its subsidiaries;

13

provided that copies of any such statements or certificates shall be delivered
- --------
to counsel for the Purchasers.

(d) You shall have received on each Closing Date an opinion of Latham
& Watkins, special counsel for the Purchasers, dated the date of its delivery,
covering the matters referred to in subparagraphs (v), (vi), (viii) (but only as
to the statements in the Prospectus under "Description of Capital Stock" and
"Standby Arrangement") and subclauses (2) (3) and (4) of subparagraph (x) of
paragraph (c) above.

With respect to subparagraph (x) of paragraph (c) above, Bronson,
Bronson & McKinnon may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and Prospectus
and any amendments or supplements thereto and documents incorporated therein by
reference and review and discussion of the contents thereof, but are without
independent check or verification except as specified. With respect to clauses
(2), (3) and (4) of subparagraph (x) of paragraph (c) above, Latham & Watkins
may state that their opinion and belief are based upon their participation in
the preparation of the Registration Statement and Prospectus and any amendments
or supplements thereto (other than the documents incorporated by reference) and
review and discussion of the contents thereof (including documents incorporated
therein by reference), but are without independent check or verification except
as specified.

The opinions of Bronson, Bronson & McKinnon described in paragraph (c)
above shall be rendered to you at the request of the Company and shall so state
therein.

(e) You shall have received market stand-off agreements from each
director and each executive officer of the Company (collectively, the
"Insiders") providing that in the event that the Purchasers purchase at least
350,000 Standby Shares pursuant to this Agreement, the Insiders will not sell or
otherwise dispose of any equity security of the Company or derivative of an
equity security of the Company for a period of 90 days following Closing Date
II.

(f) You shall have received, on the date hereof, on the date the
Company files the 1994 10-K pursuant to Section 6(g) below, and each Closing
Date, a letter dated the date of its delivery, in form and substance
satisfactory to you, from Ernst & Young, independent public accountants,
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the financial
statements and certain financial information contained or incorporated by
reference in the Registration Statement and the Prospectus.

(g) The Company shall have filed the 1994 10-K under the Exchange Act
on or before March 6, 1995 in form and substance satisfactory to you in the
exercise of your discretion.

7. Indemnification and Contribution.
--------------------------------

14

(a) The Company agrees to indemnify and hold harmless each Purchaser
and each person, if any, who controls such Purchaser within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act, from
and against any and all losses, claims, damages and liabilities, joint or
several, (including, without limitation, any legal or other expenses reasonably
incurred by such Purchaser or any such controlling person in connection with
defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary prospectus or
the Prospectus (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto), or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to the Purchasers furnished to the Company in writing by the Purchasers
expressly for use therein.

(b) Each Purchaser severally agrees to indemnify and hold harmless the
Company, the directors of the Company, the officers of the Company who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
the Purchasers, but only with reference to information relating to such
Purchaser furnished to the Company in writing by such Purchaser expressly for
use in the Registration Statement, any preliminary prospectus, the Prospectus or
any amendments or supplements thereto. The Company acknowledges that statements
set forth under the heading "Standby Arrangements" constitute the only
information furnished in writing by or on behalf of the Purchasers for inclusion
in the Prospectus.

(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to any of the two preceding paragraphs, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would, in the good faith judgment of counsel to the
Indemnified Party, be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party shall not,
in respect of the legal expenses

15

of any indemnified party in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for (a) the fees and expenses of
more than one separate firm (in addition to any local counsel) for the
Purchasers and all persons, if any, who control the Purchasers within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange
Act and (b) the fees and expenses of more than one separate firm (in addition to
any local counsel) for the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either such Section, and that all such fees and expenses shall be
reimbursed as they are incurred. In the case of any such separate firm for the
Purchasers and such control persons of the Purchasers, such firm shall be
designated in writing by the Purchasers. In the case of any such separate firm
for the Company, and such directors, officers and control persons of the
Company, such firm shall be designated in writing by the Company. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such proceeding.

(d) If the indemnification provided for in paragraph (a) or (b) of
this Section 7 is unavailable to an indemnified party or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party on the one hand and the indemnified
party on the other hand from the transactions contemplated by this Agreement or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the indemnifying party on the one hand and of the indemnified party on the other
hand in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Company on the one hand and such
Purchaser on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a

16

material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by such Purchaser and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.

(e) The Company and the Purchasers agree that it would not be just or
equitable if contribution pursuant to this Section 7 were determined by pro rata
--- ----
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, no Purchaser or the persons
controlling the Purchasers shall be required to contribute any amount in excess
of the aggregate of such Purchaser's total compensation pursuant to Section 4
hereof and such Purchaser's net proceeds from the resale of the Standby Stock
after deduction of the purchase price thereof and all costs associated with such
resale. No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The remedies
provided for in this Section 7 are not exclusive and shall not limit any rights
or remedies which may otherwise be available to any indemnified party at law or
in equity.

8. Survival of Certain Representations, Warranties and Obligations.
---------------------------------------------------------------

The indemnity and contribution provisions contained in Section 7
hereof and the representations and warranties of the Company contained in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, and (ii) any investigation made by or on
behalf of the Purchasers or any person controlling either Purchaser, or by or on
behalf of the Company, its officers or directors or any person controlling the
Company.

9. Effectiveness and Termination.
-----------------------------

(a) This Agreement shall become effective upon the later of (x)
execution and delivery hereof by the parties hereto and (y) release of
notification of the effectiveness of the Registration Statement by the
Commission.

(b) This Agreement shall be subject to termination by notice given by
you to the Company if (A) after the execution and delivery of this Agreement and
prior to the Redemption Date (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange, the National Association of Securities
Dealers, Inc., the Chicago Board of Options Exchange, the Chicago Mercantile
Exchange or the Chicago Board of Trade, (ii) trading of

17

any securities of the Company shall have been suspended on any exchange or in
any over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in your good faith judgment, is material and adverse and (B) in the case
of any of the events specified in clauses (A)(i) through (iv) of this Section
9(b), such event singly or together with any other such event makes it, in your
good faith judgment, on Closing Date I or Closing Date II, as the case may be,
impracticable to market the Shares on the terms and in the manner contemplated
in the Prospectus.

If this Agreement shall be terminated by the Purchasers because of any
failure or refusal on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, or if for any reason the
Company shall be unable to perform its obligations under this Agreement, the
Company will reimburse the Purchasers for all out-of-pocket expenses (including
the fees and disbursements of counsel) reasonably incurred by the Purchasers in
connection with this Agreement or the offering contemplated hereunder.

10. Notices. All communications hereunder will be in writing and, if
-------
sent to the Purchasers, will be mailed, delivered or telegraphed and confirmed
to:

Donaldson, Lufkin & Jenrette
Securities Corporation
140 Broadway
New York, New York 10005
Attention:
-----------------

and



Salomon Brothers Inc
333 South Hope Street
Suite 3200
Los Angeles, California 90071
Attention:
-------------------

With a copy of the Notice to the Purchasers to:

Latham & Watkins
505 Montgomery Street, 19th Floor
San Francisco, CA 94111-2514
Attention: Christopher Kaufman, Esq.

or, if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to:

18

Advanced Micro Devices, Inc.
915 DeGuigne Drive
Sunnyvale, CA 94088
Attention: Marvin Burkett

with a copy of notices to the Company to:

Bronson, Bronson & McKinnon
505 Montgomery Street
San Francisco, CA 94111-2514
Attention: Victor J. Bacigalupi, Esq.

11. Successors. This Agreement will inure to the benefit of and be
----------
binding upon the parties hereto and their respective successors and assigns and
the officers and directors and controlling persons referred to in Section 7 of
this Agreement, and no other person will have any right or obligation hereunder.

12. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.

13. Applicable Law. This Agreement shall be governed and construed
--------------
in accordance with the laws of the State of California.

19

If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us one of the enclosed counterparts hereof,
whereupon it will become a binding agreement between the Company and the
Purchasers in accordance with its terms.

Very truly yours,

ADVANCED MICRO DEVICES, INC.



By /s/ Marvin D. Burkett
------------------------------
Name Printed: Marvin D. Burkett
Title: Senior Vice President
Chief Administrative Officer
Chief Financial Officer and Treasurer

The foregoing Standby Agreement
is hereby confirmed and accepted
as of the date first above written.

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION


By /s/ Steven G. Puccinelli
--------------------------------------
Name Printed: Steven G. Puccinelli
Title: Managing Director


SALOMON BROTHERS INC


By /s/ Robert Messih
------------------------------
Name Printed: Robert Messih
Title: Vice President


20