Intel

(INTC) - Get Report

and

Network Appliance

(NTAP) - Get Report

said Friday they signed a seven-year technology and business agreement worth $1 billion this morning, and investors jumped at the news.

Both their shares climbed in pre-open

Instinet

trading, with Intel gaining 25 cents to $30.25, up from Thursday's close of $30, while Network Appliance rose $1.94 to $35.75, up from $33.81.

The companies said specific financial terms of the agreement, which extends their existing business relationship, are confidential.

Under the agreement, Intel will purchase Network Appliance's systems in its data center operations while the network storage maker will purchase Intel's microprocessors, systems, and other components. The companies have also agreed to jointly license, patent and develop technology.

"NetApp and Intel will be at the forefront of defining a new data architecture that will connect enterprises and their customers with information and new digital media seamlessly without bottlenecks,'' said Dan Warmenhoven, chief executive officer of Network Appliance.