Chip-maker Nvidia will receive US$1.5 billion from market leader Intel over the next five years to settle year-old disputes.

The two heavyweight chipmakers signed a patent cross-licensing agreement that creates a peace treaty in a legal over disputed technology.

As per terms of the agreement, Nvidia will receive $1.5 billon in five annual installments. The first installment will be made in January. The deal also states that Nvidia will be able to use Intel patents, apart from proprietary processors, flash memory and certain chipsets. In return, Nvidia will provide Intel with access to its full range of patents.

Nvidia had accused Intel of using unjust business tactics to exclude it from the market. Around 80 per cent of PCs in the world are powered by Intel chips. Both chipmakers had accused each other of violating a chip-licensing deal that they had hit in 2004.

Speaking on the deal, Intel's senior vice president Doug Melamed said, "It also enables the companies to focus their efforts on innovation and the development of new, innovative products."

The world's number 1 chipmaker Intel has also penned a five-year cross-licensing deal AMD and agreed to pay it $1.25 billion to clear up all disputes.