Note 11 - Collaborative Arrangement

3 Months Ended

Apr. 29, 2017

Notes to Financial Statements

Collaborative Arrangement Disclosure [Text Block]

11.

           Collaborative Arrangement

In

September 2016,

we entered into a joint collaboration agreement with Telechips Inc. (“Telechips”) to develop and commercialize a set-top box microprocessor SoC solution. Martin Manniche, a member of our board of directors, also serves on the board of directors of Telechips. Telechips is responsible for the manufacture of the products and is also the principal in the end customer product sales. Telechips’ wholly-owned subsidiary has the primary responsibility for order fulfillment, collection of receivables and handling of sales returns in all territories. We receive a marketing service fee in an amount equal to

50%

of the net profit from the collaboration agreement, which is included in net revenue. The marketing service fee is recognized when products are shipped and all risks and rewards of ownership have been transferred to

third

-party customers, minus the cost of production and related operating expenses incurred by Telechips. Research and development costs are shared equally and cost reimbursement to Telechips is recognized as incurred and included in research and development expenses. The agreement will continue until the later of

July 31, 2018

or cessation of the sale of products. The term

may

be extended by mutual agreement of both parties.

Net loss from this collaborative arrangement, included in net revenue, was less than

$0.1

million for the

three

months ended

April 29, 2017.

Research and development expense recorded in connection with this collaboration agreement was

$0.5

million for the

three

months ended

April 29, 2017.