Common use of Capacity Commitment Clause in Contracts

Capacity Commitment. (a) Within ten (10) days after receipt of Spansion’s four quarter forecast, SMIC shall provide Spansion with a written plan detailing SMIC’s manufacturing capacity commitments for the forecast period (the “Capacity Plan”), provided that in any calendar quarter, SMIC shall provide [*******] of the Firmly Forecast Orders for such quarter and shall use commercially reasonable efforts to provide additional capacity beyond [*******], as requested and as available. Spansion will order an amount equivalent to [*******] of the forecast for such quarter or the Capacity Plan, whichever is less. If Spansion believes Spansion requires more capacity than provided in the Capacity Plan, the Parties shall cooperate in good faith to resolve Spansion’s capacity requirements. [*******] Confidential treatment requested. (b) SMIC shall provide current-quarter weekly Wafer output updates to the four quarter forecast of Contract Wafers. This weekly update would comprehend anticipated changes to forecast related to deviations from planned cycle-time, Yield and fabrication processing excursions. Spansion's production control staff will use the weekly updates to direct SMIC activities. (c) SMIC shall provide Spansion prompt written notice if SMIC becomes aware of any circumstance which may constrain its capacity to manufacture Contract Wafers in accordance with the then current four quarter forecast. If SMIC’s manufacturing capacity to manufacture products for Spansion is constrained for any reason, SMIC will treat Spansion as it does its other sole sourced customers and with the same priority as such customers, without regard to wafer pricing. (d) Subject to agreement on the terms and conditions associated therewith, SMIC agrees to maintain a wafer bank with [*******] of volume in amounts requested by Spansion (henceforth to be referred to as the "Wafer Bank") in an amount no greater than [*******] Contract Wafers. The Wafer Bank will be arranged such that inventory carried in the Wafer Bank shall, for financial accounting purposes, be inventory of SMIC.

Capacity Commitment. (a) Within ten (10) days after receipt of SpansionCompany’s four quarter forecastFour Quarter Forecast, SMIC Foundry shall provide Spansion Company with a written plan detailing SMICFoundry’s manufacturing capacity commitments for the forecast period (the “Capacity Company Support Plan”), provided that in . In any calendar quarter, SMIC shall Foundry will provide [*******] up to one-hundred-twenty percent (120%) of the Firmly Forecast Orders for such quarter and shall use commercially reasonable efforts to provide additional capacity beyond [*******], as requested and as available. Spansion will order an amount equivalent to [*******] of the forecast for such quarter or the Capacity Plan, whichever is less. If Spansion Company believes Spansion that it requires more capacity than provided in the Capacity Company Support Plan, Company may address its concerns through the Parties shall cooperate in good faith to resolve Spansion’s capacity requirements. [*******] Confidential treatment requestedDispute Resolution process of Section 17 (entitled — Dispute Resolution). (b) SMIC Foundry shall provide current-quarter weekly Wafer wafer/die output updates to the four quarter forecast of Contract WafersFour Quarter Forecast. This weekly update would comprehend anticipated changes to forecast related to deviations from planned cycle-time, Yield and fabrication processing excursions. Spansion's Company’s production control staff will use the weekly updates to direct SMIC Foundry activities, including the disposition of Contract Wafers for shipping or of material into Buffer Inventory. (c) SMIC Foundry shall provide Spansion Company prompt written notice if SMIC Foundry becomes aware of any circumstance which may constrain its capacity to manufacture Contract Wafers in accordance with the then current four quarter forecastFour Quarter Forecast. If SMICFoundry’s manufacturing capacity to manufacture products for Spansion Company is constrained for any reason, SMIC Foundry will treat Spansion Company as it does its other sole sourced customers and with the same priority as such customerscustomers (to the extent that Foundry is the sole foundry source for the products affected by production constraints), without regard to wafer pricing. (d) Subject to agreement on the terms and conditions associated therewith, SMIC agrees to maintain a wafer bank with [*******] of volume in amounts requested by Spansion (henceforth to be referred to as the "Wafer Bank") in an amount no greater than [*******] Contract Wafers. The Wafer Bank will be arranged such that inventory carried in the Wafer Bank shall, for financial accounting purposes, be inventory of SMIC.