Exhibit 10.5
I FOUNDRY PRODUCTION AGREEMENT
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This Agreement ("Agreement") dated as of June 27, 1996 (the "Effective
Date") is entered into by and among Sony Semiconductor Company of America, a
division of Sony Electronics Inc., having an address at Xxx Xxxx Xxxxx, Xxx
Xxxxxxx, Xxxxx 00000-0000 ("Sony") and Lanstar Semiconductor Inc., having its
principal place of business at 0000 Xxx X, Xxxxx 000, Xxxxxxxxx, Xxxxx 00000
("Customer").
RECITALS
A. Customer is a design, technology, development and/or marketing company of
semiconductor products.
B. Sony is engaged in the business of providing semiconductor wafer foundry
service.
C. Customer wishes to obtain, and Sony wishes to provide, wafer foundry
service for certain products designed and developed by or for Customer.
NOW, THEREFORE, the panics agree as follows:
1.0 DEFINITIONS
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1.1 "Product (s)" shall mean those products and wafers designed by Customer
which Sony manufactures for customer under this Agreement. A list of
Products is attached as Exhibit A Additional products may be added by
mutual written agreement.
1.2 "Mask Work Rights" shall mean those rights relating to an integrated
circuit, as specified by the United States Protection Act of 1984 or an,
analogous statute of any other country of the world, which have a first
effective filing date in any country prior to the expiration or
termination of this Agreement.
1.3 "Patents" shall mean all classes or types of patents, utility models and
design patents of all countries of the world, applications for which have
a first effective filing date in any country of the world prior to the
date of expiration or termination of this Agreement.
2.0 MANUFACTURE OF PRODUCTS
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2.1 Subject to the terms and conditions of this Agreement, Customer grants
Sony a royalty-free, non-exclusive, revocable, non-transferable and non-
assignable license, without right to sublicense, to make the Products for
the sole purpose of sales to Customer.
2.2 Sony shall manufacture the Products designed by Customer exclusively for
Customer pursuant to the terms of this Agreement.
2.3 Customer will provide Sony at no cost to Sony technical support and
assistance in bringing up the Products at Sony's manufacturing site upon
terms and conditions agreed to by Customer and Sony.
2.4 Customer will assist, if needed by Sony, in bringing up process and test
capabilities for Products at Sony's manufacturing site upon terms and
conditions agreed to by Customer and Sony.
2.5 Customer shall provide Sony with a full reticle set compliant with Sony's
requirements for each Product to be manufactured. The Customer shall have
full responsibility for the reticle(s) cost.
2.6 Sony maintains the fight to use any processes developed in connection
with the work- performed under this Agreement for itself or other
customers.
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3.0 OWNERSHIP OF PRODUCTS
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3.1 Customer will retain and own exclusively throughout the world all right,
title, and interest in the Products and designs, Patents, copyrights,
Mask Work Rights and proprietary information related to the Products,
subject only to the specific manufacturing license rights granted to Sony
herein.
3. 2 Sony will purchase for Customer silicon substrates to support the
manufacturing plan. The purchase of substrates will be approved in
writing by Customer, and Customer will reimburse Sony for any unused
substrate inventory within 30 days of notification by Sony. Upon receipt
of payment Sony will ship such inventory to Customer.
4.0 MINIMUM PRODUCTION OF PRODUCTS
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4.1 Subject to the terms of this Agreement, and mutually agreed yield targets
if reached, Sony will ramp up to provide mutually agreed upon capacity
that is referenced in Exhibit B. Such capacity goal may be modified by
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mutual written agreement.
4.2 Sony will use reasonable commercial efforts to manufacture a sufficient
quantity of Products to meet Customer's requirements, as reflected by
purchase orders accepted by Sony pursuant to Section 5 below.
5.0 PRICING, DELIVERY AND REL RASP SCHEDULE
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5.1 Pricing: The purchase price and cost charged to Customer for Products and
other services purchased from Sony under this Agreement will be per
attached Exhibit C. Such purchase price may be changed by mutual written
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agreement.
5.2 Customer shall provide Sony by the fifteenth (15) day of each month a six
(6) month rolling forecast for Products. Such forecast shall constitute a
binding commitment by Customer to purchase one hundred percent (100%) of
the Products indicated in the first three (3) months of the forecast. The
remaining months data will be provided for planning purposes only and no
obligation to purchase or supply Products (other than those committed to
in the first three (3) months) shall exist on the part of Customer or
Sony, respectively.
5.3 Sony shall provide a response to each six (6) month forecast within five
(5) working days of Sony's receipt of such forecast. Within five (5)
working days of receipt of Sony's response, Customer shall issue to Sony,
a purchase order for the upcoming three (3) months of such forecast.
5.4 Sony shall make reasonable commercial efforts to achieve on-time
delivery. Delivery of Products shall be to purchase order release dates
specified on the purchase order. Sony will be deemed to have shipped
completed quantities, if the quantity shipped is +/- 5% of the quantities
specified in the purchase order release. Customer may reject any other
Products that do not meet quantity or shipping window allowances.
5.5 Sony will make reasonable efforts to provide linear weekly shipments.
5.6 Upon request, Sony and Customer shall negotiate in good faith with
respect to placing certain lots or orders on hold, the number of units to
be held, the place in line where they will be held and the period of time
they will be held. Lots on hold by customer's request will be subject to
inventory charges per Exhibit D.
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6.0 RELIABILITY AND QUALITY
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6.1 Subject to the terms a Non-Disclosure Agreement in the form attached as
Exhibit F Sony will provide, upon written request, its available
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reliability and quality data regarding Products throughout the term of
this Agreement.
6.2 Sony and Customer shall jointly establish Quality and Reliability
Standards consistent with those reflected in Exhibit F for the foundry
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wafer process involved in manufacturing Products under this Agreement, as
well as the actual Products manufactured under this Agreement. Once such
Quality and Reliability Standards are jointly agreed to in writing, the
portion of such standards as relate to specific Product performance
characteristics, and are specifically identified as "Product Warranty
Characteristics", shall provide the basis for Sony's warranty in Section
7.2. Should the parties be unable to agree on Quality and Reliability
Standards, this Agreement shall be terminated.
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6.3 Sony shall give Customer at least two (2) weeks written notice Of any
proposed changes in material or to its existing manufacturing process
that, to the best of Sony's knowledge might affect the to fit,
performance, maintainability, operation, function, reliability,
interface, interconnectability, compatibility, design rules, models, of
am of the products (the proposed Change Notice). Such Proposed Change
Notices shall describe the nature of the proposed change, including the
reasons for the change and arty relevant performance consideration.
Customer shall accept or reject such proposed change promptly, but not
later than five (5) business days after receipt of the Proposed Change
Notice. If Customer disapproves of such proposed change, Sony shall
continue to manufacture and deliver unchanged Products in accordance with
this Agreement, for at least six (6) months from the date Sony issues the
proposed change notice. Upon the expiry of such six (6) months, Sony at
its discretion may stop manufacturing and delivery of the Product without
any liability. Reliability and quality data that is available will be
provided by Sony to Customer prior to scheduled conversion or
introduction. All changes will be subject to the Quality and Reliability
Standards established pursuant to Paragraph 6.2 or contained in any other
specifications agreed to in writing by Sony and Customer.
6.4 Customer reserves the right to make any changes it deems appropriate to
the design of the Products. Such changes shall be documented by Change
Notices. After a prototype run for a particular Product has been made,
any changes to processes or materials for Product requested by Customer
shall be subject to Sony's consent and Customer's payment of applicable
costs, if any, related to such change. The Customer is limited to two (2)
wafer qualification lots in process at any one time.
6.5 Sony and Customer shall establish yield criteria based on the initial ten
(10) production lots after the yield has stabilized.
6.6 Sony, at its option, may provide wafer sort and chip probing services at
the price(s) set forth in Exhibit C
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6.7 During the term of this Agreement, Sony shall maintain FAB and test lot
traceability for Products manufactured under this Agreement, but not to
exceed three years from date of manufacture.
6.8 Sony will promptly and in writing after discovery, advise Customer of
defects and non-conformities discovered by it in Products already shipped
and in lots currently in manufacture. Customer will promptly and in
writing after discovery, advise Sony of defects and non-conformities in
Products shipped by Sony, whether this discovery is by the Customer or
Customer's customers.
7.0 WARRANTY AND ACCEPTANCE
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7.1 Sony warrants and represents that Customer will acquire good title to the
Products free and clear of all claims, liens and encumbrances.
7.2 Sony, warrants that the Product at Lime of delivery to Customer will meet
the written Quality and Reliability Standards jointly developed by Sony -
arid Customer as referenced in Section 6.2 hereof. Upon receipt of
written request by Customer, and subject to section 7.8 below, Sony will
immediately stop shipment of products, which fail to meet the criteria,
specified in Section 6.2. If Sony is responsible for the failure, and is
unable to correct such failure within thirty (30) days of receipt of such
a written request, Customer may reject the nonconforming Products and
cancel any then committed purchase order for those Products which are
subject to the failure, by sending written notice of cancellation to Sony
within sixty (60) days of the written request to stop shipment. Such a
notice shall be effective on receipt by Sony.
7.3 Products which am the subject of warranty claims shall be returned in
component form (removed from boards) to Sony pursuant to a mutually
agreeable return material authorization procedure to be established by
Sony and -Customer. Customer shall make any warranty claim under this
Agreement not more than six (6) months after delivery by Sony to Customer
of the Products which are subject to the claim.
7.4 Sony shall at Sony's option either (1) replace any Products not meeting
the warranty provided in Sections 7.1 and 7.2 with an equivalent number
of replacement Products without charge, or (2) refund the payments made
to Sony for such Products, all within thirty (30) calendar days of
receipt by Sony of such Products.
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7.5 The foregoing is Sony's sole responsibility and the exclusive remedy of
Customer for any breach the warranties contained in this Agreement Sony
shall - not be responsible for defects caused by design application or
assembly by third parties.
7.6 THE WARRANTIES STATED IN THIS AGREEMENT ARE THE ONLY WARRANTIES THAT
APPLY TO PRODUCTS MANUFACTURED HEREUNDER AND THESE WARRANTIES ARE IN LIEU
OF ANY AND ALL OTHER WARRANTIES EXPRESS OR IMPLIED, INCLUDING THE
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. AND
THERE ARE NO OTHER REPRESENTATIONS OR WARRANTIES, EITHER EXPRESS OR
IMPLIED INCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND
FITNESS REGARDING THE PRODUCT EXCEPT AS EXPRESSLY STATED IN MS AGREEMENT.
The warranties hereunder will survive the termination of this Agreement.
7.7 Upon Customer's written request, Sony's written consent, and mutually
satisfactory arrangements for payment to Sony for the costs involved,
Sony agrees to perform failure analysis of Products returned to Sony. If
the defects are found to be the result of Sony's failure to comply with
its warranties hereunder, Sony will not be entitled to payment from
Customer for the cost of the failure analysis performed by Sony of the
specific Products subject to the defect.
7.8 If Customer requests Sony to stop shipment of any Products which are
subsequently determined in good faith by Sony and Customer to have been
processed in accordance with Sony's standard processing specifications,
Sony shall be entitled to full payment under the terms of this Agreement
for completed products as well as all work in progress. In this
situation, payment for completed Products will be at the purchase order
price thereof determined according to Exhibit D. In addition, the
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inventory charges determined according to Exhibit D will be paid by the
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Customer to Sony.
8.0 SHIPMENT/TERMS OF PAYMENT
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8.1 Subject to the terms of this Agreement, Sony agrees to honor and fill any
purchase order submitted pursuant to this Agreement by Customer and
accepted by Sony pursuant to Section 5.3. Customer guarantees the payment
of any and all obligations accrued pursuant to such purchase orders.
Invoices for Products sold to Customer shall be paid at net 30 days of
invoice date, delinquent payments may at Sony's sole option, accrue
interest at 1 %/month Invoices for Products shipped shall show the price
of such Products in U.S. dollars. In case a payment due day is a holiday
or weekend, payment will be made on the next regular business day.
Payment shall be made in U.S dollars from Customer to Sony Electronics
Inc., Sony Semiconductor Company of America, Xxx Xxxx Xxxxx, Xxx Xxxxxxx,
Xxxxx 00000-0000. Failure by Customer to make payments will permit Sony
to (a) declare all unpaid amounts immediately due and (b) cancel all
outstanding Purchase Orders and decline new ones.
8.2 Sony shall deliver Products FOB Sony's facility in San Antonio, Texas.
Title and risk of loss will pass to Customer upon delivery to such FOB
point.
8.3 In event that any payment under this Agreement becomes restricted for any
reason, the party whose payment obligation is restricted agrees, at its
own expense, to immediately take whatever steps or actions may be
necessary to assure such payment.
9.0 REPRESENTATIONS AND WARRANTIES
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9.1 Sony and Customer each represent and warrant that:
a) It has the full right and title or adequate rights to all of the
information and intellectual property to be delivered or utilized by
it under this Agreement; and
b) It has the right and power to enter into this Agreement.
9.2 Sony represents and warrants that the Sony manufacturing processes do not
infringe any patent, trade secret, mask work right, trademark, copyright
or other proprietary right of any-person or entity. If Sony's manufacture
of Products or process is the basis for a charge of infringement of a
third party's patent, trade secret, mask work right trademark copyright
or other proprietary right, Sony will indemnify Customer for all costs
associated with defense of an action for infringement (including
reasonable attorney fees) and for all damages awarded by a court of last
resort as a result of such action
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9.3 Customer represents and warrants that the Product and any process
information given by Customer to process required of Sony do not infringe
any patent, tradesecret, mask work right, trademark, copyright, or other
proprietary right of any third person or entity, if Customer's Product or
process is the basis for a charge of infringement of a third party's
patent, trade secret mask work right, trademark, copyright or other
propriety right, Customer will indemnify Sony for all costs associated
with the defense of an action for infringement (including reasonable
attorney fees) and for all damages awarded by a court of last resort as a
result of such action.
9.4 A party's indemnification obligation pursuant to Sections 9.2 and 9.3
above is conditioned on the following: (i) the indemnifying party is
notified promptly in writing by the indemnified party of any notice of
such claim but in no event later than ten (10) days after the indemnified
party shall have received any notice thereof; (ii) the indemnifying party
shall have, at its option, sole control of the defense of any action on
such claim and all negotiations for its settlement or compromise and
(iii) the indemnified party shall fully cooperate with the indemnifying
party in the defense and all related settlement negotiations at the
expense of the indemnifying party.
10.0 LIMITATIONS OF LIABILITY
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10.1 IN NO EVENT SHALL ONE PARTY BE LIABLE TO THE OTHER FOR ANY LOST PROFITS,
LOSS OF USE, COST OF OBTAIN1NG SUBSTITUTE GOODS OR SERVICES, OR ANY
INCIDENTAL, CONSEQUENTIAL, SPECIAL, INDIRECT, EXEMPLARY OR PUNITIVE
DAMAGES ARISING UNDER OR IN ANY WAY RELATING TO THIS AGREEMENT. IN NO
EVENT SHALL SONY's LIABILITY TO CUSTOMER FOR ANY CLAIM OR CLAIMS RELATING
TO THE PRODUCTS OR THIS AGREEMENT EXCEED THE PURCHASE PRICE RECEIVED BY
SONY FROM CUSTOMER FOR THE PRODUCTS TO WHICH SUCH CLAIMS RELATE.
11.0 TERM AND TERMINATION
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11.1 This Agreement shall remain in effect for three (3) years from the
Effective Date, unless terminated sooner pursuant to this Section 11.
Subject to the other terms herein, Sony or Customer may terminate this
Agreement by giving three (3) months prior notice in writing of the
intention to terminate, provided that such notice may not be given within
four (4) months of the Effective Date.
11.2 Notwithstanding Section 11.1, this Agreement may be terminated by a party
effective immediately and without liability upon the occurrence of any
one of the following events:
a) The other parry files a voluntary petition in bankruptcy or otherwise
seeks protection under any law for the protection of debtors;
b) A proceeding is instituted against the other party under any provision of
the U.S. Fed Bankruptcy Case, which is not dismissed within sixty (60)
days;
c) The other party is adjudged a bankrupt;
d) A court assumes jurisdiction of the assets of the other party under a
federal reorganization act;
e) A trustee or receiver is appointed by a court for all or a substantial
portion of the assets of the other party;
f) The other party becomes insolvent, ceases or suspends business;
g) The other party makes an assignment of its assets for the benefit of its
creditors;
h) The other party admits in writing its inability to pay its debts as they
become due
i) The continued performance of this Agreement by the other party would
result in a violation of then current applicable export regulations;
j) There is a transfer of majority invest in the equity or assets of the
other party to a competitor of terminating party; or
k) the other party assigns this Agreement without the consent of the
terminating party.
11.3 Notwithstanding Section 11.1, if any party fails to perform or violates
any material obligation under this Agreement, upon thirty (30) days
written notice to the breaching party specifying such (the "Default
Notice"), the non-breaching parry may terminate this Agreement, without
liability, unless:
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a) the breach specified in die, Default Nonce his been cured within the
thirty (30) day period; or
b) the default reasonably requires mom than thirty (30) days to correct
(specifically excluding any failure to pay more money), and the
defaulting party has begun substantial corrective action to remedy the
default within such thirty (30) day period and diligently pursues such
action, in which event termination shall not be effective unless sixty
(60) days expired from the date of defaulting party's receipt of the
Default Notice without such corrective "on being completed and the
default remedied.
In the event of a breach of a material provision of this Agreement by a
party, the non-breaching party shall provide a detailed written description
of the breach as well as any available information reasonably useful or
necessary to enable a cure. The breaching party shall meet with the non-
breaching party within seven (7) working days following receipt of notice
of breach, and shall submit a plan to remedy the breach within twenty (20)
days of receipt of such notice. The non-breaching party will accept or
reject the plan (giving reasons thereof in the case of rejection) within
(5) days of receipt. If the breach is not cured or a plan reasonably
acceptable to the non-breaching party is not agreed upon within thirty (30)
days from initial receipt of the notice of breach, subject to the other
terms arid procedures stated herein and the requirements of law, the non-
breaching party may terminate this Agreement immediately upon written
notice to the other party.
11.4 If Customer terminates this Agreement for any of the reasons stated in
Sections 11.2 or 11.3, upon receipt of written request from Customer, Sony
will:
(1) cease all production required by Customer purchase orders under this
Agreement;
(2) deliver all completed Products manufactured pursuant to Customer's
purchase orders and invoice customer for the same completed Products.
11.5 If Sony terminates this Agreement for any of the reasons stated in Section
11.2 or 11.3, Sony shall be entitled to payment in full from Customer upon
delivery of all completed Products manufactured pursuant to outstanding
purchase orders issued under this Agreement, as well as to reimbursement
for all reasonable direct costs and expenses associated with all work then
in progress. Work-in-progress value shall be determined according to
Exhibit D.
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11.6 The parties' rights and remedies herein are in addition to any other rights
they may have at law or in equity, except as expressly disclaimed or
limited herein.
12.0 PROPRIETARY RIGHTS
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12.1 Each party agrees that information furbished to a party by the other party
under this Agreement will be protected against disclosure to any third
party or use for any purpose other than performing this Agreement in
accordance with the terms of the attached Non-Disclosure Agreement
Exhibit E
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12.2 All discoveries, improvements and inventions, conceived or first reduced to
practice, as those terms are used before the U.S. Patent Office in the
performance of this Agreement solely by one party and without reliance upon
confidential or proprietary information of the other party shall remain the
property of the first party and such party shall retain any and all rights
to file at its sole discretion any, patents applications thereon.
13.0 CONTINGENCIES
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13.1 No party shall be in breach hereunder for any failure to perform due to
causes beyond its reasonable control, including but not Limited to acts of
God, war, riot, embargoes, or other causes beyond its reasonable control,
for maximum period of sixty (60) days.
13.2 This Agreement shall only become effective on the date it is fully executed
by both parties and approved, to the extent necessary, by applicable
government authorities. The parties agree to make their best faith efforts
to obtain such approval as soon as possible.
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14.0 PUBLICITY
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14.1 Sony and Customer agree that the existence of details connected with this
Agreement shall am be published or disclosed to any third party, except as
required by law or by auditors, without the other party's written
permission. In the event of a required disclosure, the other party shall be
notified first of such pending disclosure.
15.0 ASSIGNMENT
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15.1 Neither Sony nor Customer may delegate any obligation under this Agreement
or assign any interest or right hereunder without the prior written consent
of the other, and any such attempt shall be void. Notwithstanding the
foregoing Sony may assign all or any part of its rights or obligations
hereunder to any of Sony's direct or indirect parent(s) and/or wholly-owned
subsidiaries of such parents. The assigning party shall remain jointly and
severally responsible for its obligations hereunder.
15.2 Upon any merger, consolidation or change in control of any party to this
Agreement, the surviving organization resulting therefrom shall be bound by
the terms of this Agreement.
16.0 COMPLIANCE WITH THE LAW
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16.1 The parties agree that they will comply with all applicable laws, including
laws regarding export of Products supplied under the terms of this
Agreement.
16.2 Each party to this Agreement shall do all things necessary to obtain all
licenses and approvals necessary and to comply with all applicable laws,
rules and regulations in fulfilling its obligations hereunder.
17.0 CONTROLLING LAW: VENUE
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17.1 This Agreement shall be governed by and construed in accordance with the
laws of the State of California. Any dispute arising out of this agreement
shall be subjected to exclusive jurisdiction of the U.S. District Courts of
the Northern District of California and/or in the Santa Xxxxx County
Superior Court of the State of California.
18.0 NOTICES
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18.1 All notices required to be sent to the parties under this Agreement will be
sent by courier service, facsimile or telex to the address set forth below
or to such other addresses as may subsequently be designated in writing:
If to Sony: If to Customer:
Sony Electronics, Inc. Lanstar Semiconductor Inc.
San Xxxx Law Department 2501 Avenue J
0000 Xxxxxx Xxxx Xxxxx 000
Xxx Xxxx, XX 00000-0000 Xxxxxxxxx, Xxxxx00000
19.0 INDEPENDENT CONTRACTORS
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19.1 Performance by the parties under this Agreement shall be as independent
contractors. Nothing contained herein or done under the terms of this
Agreement shall constitute any party agent of the other party for any
purpose. Nothing in this Agreement shall prohibit Customer from purchasing
Products and/or foundry services from other suppliers or Sony from
performing such services or selling similar products to the Products to any
other customers.
20.0 SURVIVAL
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20.1 The-provisions of Section 1, 3, 7, 9, 10, 12, 17, 18, 20, 21, 22, 23,
and 24 shall survive the expiration or termination of this Agreement.
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21.0 CONTROLLING LANGUAGE
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21.1 This Agreement is written only in English and, even if translated, the
English language version of this agreement shall control.
22.0 WAIVER OF TRIAL BY JURY
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22.1 BOTH PARTIES HEREBY WAIVE ALL RIGHT OR ENTITLEMENT TO TRIAL BY JURY IN
CONNECTION WITH ANY DISPUTE THAT ARISES OUT OF OR RELATES IN ANY WAY TO
THIS AGREEMENT.
23.0 ATTORNEY's FEE'S
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23.1 The prevailing party in any litigation shall be entitled to recover its
costs and reasonable attorney's fees.
24.0 ENTIRE AGREEMENT
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24.1 This Agreement is the entire understanding among the parties with respect
to the subject matter hereof and supersedes all prior agreements, dealings
and negotiations. No modifications, alterations, or amendments shall be
effective unless in writing and signed by all parties. All purchase orders
under this Agreement shall be governed exclusively by the terms and
conditions hereof, and shall not be altered or modified in any way by the
terms of any purchase order form or acknowledgment form. No waiver of any
breach shall be held to be a waiver of any other or subsequent breach.
IN WITNESS WHEREOF, each representative signing below, and each party
for whom that representative signs, represents and warrants that such
representative is authorized and has authority to enter into this Agreement.
AGREED TO:
SONY SEMICONDUCTOR COMPANY CUSTOMER
OF AMERICA, a division of Sony Electronics, Inc.
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Signature Signature
Print Name: Xxxxxxx Xxxxxx Print Name: Xxxxxx Xxxxxxx
Title: Exec. V.P. Title: President / C.O.O.
Date: 6/27/96 Date: 6/27/96
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Exhibit A
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Products to be produced by Sony for Customer:
In wafer form:
.5 micron 1 x 4 megabit DRAM
with metal options determining mode:
Fast Page Mode (FPM)
or Enhanced Data Output (EDO)
with metal options determining organization
4 Meg: 1x4, 4xl, 256xg
The following devices are planned by Customer Production dates and prices
will be subject to negotiation at a later date. Feature sizes are
approximate.
.4 micron 4 Meg
DRAM
.4 micron 16 Meg
DRAM
Subject to same metal options as above.
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Exhibit B
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Upon completion of Section 6.5, the following ramp schedule will be
followed:
Month 1 1000
Month 2 1500
Month 3 2000
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Exhibit C
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$1200.00/wafer with 2PC (Sort) yield Moo 80-85% repaired.
$ 1200.00/wafer plus 1.50/die for any wafer over 85% yield repaired.
Wafers with yield less than 80% are priced at $2.75/die (repaired). These lower
yield wafers will be purchased by Customer. Should Customer request Sony to test
the produced wafers, the cost will be $ 100.00/hr test time, above listed costs.
Customer agrees to sell its assembled and marked products incorporating the
Products to Sony, at Sony's sole request, at a 5% discounted purchase price from
Customer's bona fide selling price to unaffiliated third parties.
Customer agrees to purchase sufficient Product to cover Sony's development costs
for such Product (which shall include equipment modifications, module
development services, process integration services, direct and indirect
materials associated with such development and other reasonable expenses that
may be incurred, which shall in no event be charged at a rate above prevailing
industry averages). Such development costs will be determined by documented time
and materials and reviewed with Customer quarterly. For purposes of this
Exhibit, ten percent (10%) of Product price shall be attributable to Sony
development cost recovery. Upon termination of this Agreement, in the event
Company does not purchase sufficient Product to allow Sony to recover Sony
development costs at the agreed upon 10- 1 ratio, Company shall, within 30 days,
reimburse any unrecovered amount to Sony.
Example:
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If Customer issues P.O. for $100,000 of Product and Sony ships the entire P.O.
value, $10,000 of this invoice would be applied to development costs.
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Exhibit D
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The value of material will be established by taking the selling price thereof
and dividing by the number of mask layers in the process. The selling prices of
the work-in-progress shall be deemed $1200.00/wafer.
Example: Assumes selling price is $1200.00 and 18 layers
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$1200.00 + $66.67/mask layer
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This number will be multiplied by the number of mask steps completed to
establish the value of the material.
Should the material remain on-hold for more than 15 calendar days, Customer will
pay Sony .025% per day interest on the value of the material beyond the initial
15 calendar days, as determined above
All material holds and releases must be confirmed by dated written agreement.
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Exhibit E
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CONFIDENTIALITY AND NONDISCLOSURE AGREEMENT
THIS AGREEMENT, is made and entered into as of June 27, 1996 ("Effective
Date") between Sony Semiconductor Company of America, a division of Sony
Electronics Inc., a Delaware corporation, with an office at 0000 Xxxxxx Xxxx,
Xxx Xxxx, Xxxxxxxxxx 00000 ("Sony"); and Lanstar Semiconductor Inc., having its
principal office at 0000 Xxx X, Xxxxx 000, Xxxxxxxxx, Xxxxx 00000 ("Company");
W I T N E S S E T H:
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WHEREAS, Sony and Company are each willing to disclose to the other and to
receive certain "Confidential Information" (as hereinafter defined) from the
other parry, subject to the terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the foregoing premises and mutual promises
hereinafter contained, Sony and Company agree as follows:
1. The purpose of the disclosures hereunder shall be for the parties to
conduct the activities contemplated by that Foundry Production agreement
between the parties dated as of June 27, 1996 (the "Foundry Agreement").
The parties agree to use the Confidential Information only for such purpose
and only in accordance with the terms of this Agreement.
2. The parties hereto understand that each may now market or have under
development products which are competitive with products or services now
offered or which may be offered by the other. Subject to the terms and
conditions of this agreement, discussions and/or communications between the
parties hereto will not serve to impair the right of either party to
develop, make, use, procure, and/or market products or services now or in
the future which may be competitive with those offered by the other; nor
require either party to disclose any planning or other information to the
other.
The term "ConridCnti2l Information" shall mean and refer to all
confidential or proprietary information, documents and materials, whether
printed or in machine-readable form or otherwise, and designated by the
disclosing party as "Confidential" hereunder, developed, owned, licensed or
under the control of the disclosing party including all processes,
hardware, software, inventions, trade secrets, ideas, designs, research,
know-how, business methods, production plant and marketing plans relating
to: (i) products and processes, in case of information disclosed by
Company-, and (ii) process capability, in case of information disclosed by
Sony.
All Confidential Information shall be submitted in writing by the
disclosing party to the receiving party and marked "Confidential" or if
transmitted orally or visually, shall be identified at that Lime as
"Confidential" and within thirty (30) days thereafter shall be reduced to
writing and confirmed as "Confidential".
4. The term for disclosure of Confidential Information shall be from the
Effective Date to termination of the Foundry Agreement ("Disclosure
Period"). Subject to Sections 5 and 6 hereof during the Disclosure Period
and for a period of two (2) years after the expiration of the Disclosure
Period, each party hereto agrees to use the same degree of care and
scrutiny as the receiving party would use with respect to its own
Confidential Information to avoid disclosure, (including, but not limited
to, disclosure to the United States Government or any agency or department
thereof). publication, dissemination or use of any or all of the
Confidential Information
(i) disclosed by the other parry,. its agents or
employees hereunder, or
(ii) obtained from the other party as a result of the activities
contemplated hereunder.
5. The parties agree that with respect to the other party's Confidential
Information reach will:
(i) disclose such Confidential Information to only those employees
whose duties justify a "need-to-know" and who have executed a
confidentiality agreement in which such employee has agreed to hold
confidential and not to disclose or use, all Confidential
Information and materials (inclusive of those of third parties)
which may be disclosed to them or to which they may have access
during the course of their duties;
(ii) ensure that each document containing the Confidential Information -
made available to any employee of a receiving party bears a legend
to the effect that the information contained therein is proprietary
to the disclosing party;
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(iii) at the disclosing party's request return promptly. to such party
any and all portions of-" Confidential Information disclosed under
this Agreement together with all copies thereof, provided that the
receiving party nay retain one copy thereof in its confidential.
restricted access files for archival purposes. The parties agree to
maintain any such copy in accordance with the provisions of this
Agreement.
(iv) not disclose to any third party or use in any manner whatsoever any
Confidential Information, including, by way of example and not by
Limitation. the specifications, schematics or any other information
relating to the Company transport design, for any purpose other
than as contemplated by this Agreement.
6. Sony may disclose the Confidential Information to Sony Corporation of
America, or to Sony Corporation (Tokyo, Japan) or to any other entity
directly or indirectly controlled by either of the foregoing entities
("Sony Group"), provided that they agree to be bound to this Agreement to
the same extent that Sony is bound.
7. It is understood, however that the foregoing restrictions in Sections 1, 4,
5 and 6 above, shall not apply to any portion of the Confidential
Information which:
(i) was previously known to a receiving party or to the Sony Group
without obligation of confidentiality; or
(ii) is obtained after the date hereof from a third party which is
lawfully in possession of such information and not in violation of
any contractual or legal obligation to a disclosing party with
respect to such information, or
(iii) is or becomes part of the public domain through no fault of
receiving part), the Sony Group or its employees; or
(iv) is independently ascertained or developed by receiving party, its
employees or the Sony Group or its employees; or
(v) is required to be disclosed by administrative or judicial action
provided that the receiving part), immediately after receiving
notice of such action notifies disclosing party of such action to
give disclosing parry the opportunity to seek any other legal
remedies to maintain such Confidential Information in confidence;
or
(vi) is approved for release by written authorization of a disclosing
party.
8. Company acknowledges that the Sony Group does not need or desire to receive
either: (1) U.S. government classified information; or (2) any otherwise
restricted information, the receipt, disclosure, use or retention of which
is made a crime by any provision of the United States Code. The parties
accordingly agree that such information will not be provided, either orally
or in writing, to the Sony Group, under this Agreement, or under any
subsequent contract or subcontract between the parties which relates to the
Confidential Information disclosed under this Agreement.
9. Company hereby gives assurance to Sony that it will not knowingly, unless
it has obtained prior written authorization 'from the U.S. Department of
Commerce or is otherwise permitted by the U.S. Department of Commerce.
Export Administration Regulations, export or otherwise disclose, directly
or indirectly, any technology or software received from Sony nor allow the
direct product thereof to be shipped, either directly or indirectly, to any
destination that is proscribed under Part 779 of the U.S. Department of
Commerce Export Administration Regulations.
10. The parties hereby represent each to the other that the disclosure of the
Confidential Information by Company or Sony, as may be the case, will not
violate any proprietary rights of third parties. including.' without
limitation. confidential relationships, patent and copyright rights, or
other trade secrets. and that the disclosure by Company to Sony and/or by
Sony to Company, as may be the case hereunder, will not violate any
contractual obligations which Company or Sony may have to any third party.
11. All the Confidential Information disclosed, delivered to, or acquired by a
receiving parry from a disclosing party hereunder, shall be and remain the
sole property of the disclosing party.
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12. Disclosure of the Confidential Information disclosed by one party to the
other hereunder shall not constitute any option, grant or license to the
recipient of such Confidential information under any patent., know-how or
other rights heretofore now or hereinafter held by the disclosing party.
It is understood and agreed that the disclosure by either party hereto of
the Confidential Information hereunder shall not result in any obligation
on the part of either party to enter into any further agreement with the
other with respect to the subject matter hereof or otherwise.
No modification of this Agreement shall be effective unless in writing and
signed by both parties hereto.
14. Notices hereunder shall be in writing and shall be deemed duly given upon
delivery to:
If to Sony: Xxxxxxx Xxxxxx
If to Company: Xxxxxx Xxxxxxx
15. Each party agrees to comply, and do all things necessary for the other
party to comply, with all applicable Federal, State, and local laws,
regulations and ordinances, including but not limited to the Regulations of
the United States Department of Commerce relating to the Export of
Technical Data. insofar as they relate to the activities to be performed
under this Agreement. Sony or Company, as may be the case, agree to obtain
the required government documents and approvals prior to export of any
technical data disclosed to it or the direct product related thereto.
16. Either party's waiver of any breach or failure to enforce any of the terms
and conditions of this Agreement at any time shall not in any way affect,
limit or waive such party's right thereafter to enforce and compel strict
compliance with every term and condition thereof.
17. This Agreement shall be construed and enforced in accordance with the local
law of the State of California. The parties hereby consent to and submit to
the jurisdiction of the federal and state courts located in the State of
California, and any action or suit under this Agreement shall only be
brought by the parties in any federal or state court with appropriate
jurisdiction over the subject matter established or sitting in the State of
California. The parties shall not raise in connection therewith, and
hereby waive, any defenses based upon the venue, the inconvenience of the
forum, the lack- of personal jurisdiction, the sufficiency of service of
process or the like in any such action or suit brought in the State of
California. Sony and Company each waive any right they may have to a trial
by jury in any action, proceeding or counterclaim arising hereunder or
relating hereto.
18. This Agreement constitutes the complete agreement between the parties
hereto and supersedes and cancels any and all prior communications and
agreements between the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto by their duly authorized
representatives have executed this confidentiality and Nondisclosure Agreement
upon the date first set forth above.
Sony Semiconductor Company of America
a division of
SONY ELECTRONICS, INC. LANSTAR SEMICONDUCTOR INC.
By: By:
------------------------------ -----------------------------
Print Name: Xxxxxxx Xxxxxx Print Name: Xxxxxx Xxxxxxx
Title: Exec. V.P. Title: President C.O.O.
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EXHIBIT F
---------
Sony agrees to process Customer's wafers using the standard operating procedures
provided for in the Sony Specification System used in Sony's San Antonio
facility.. Sony will notify Customer of any event that results in deviation
from specification limits agreed to in writing prior to the start of mass
production, defined as 500 or more wafer starts per month. Such agreed
specification limits relating to each Product shall provide the basis of Sony's
warranty, which in each case will be memorialized by a written addendum to this
Agreement signed by both parties.
Customer agrees that, notwithstanding anything in this Agreement to the
contrary, dice passing Customer's Wafer Sort (2PC) Test program are deemed
acceptable for purchase by Customer.
Customer agrees to report to Sony any material that fails the percentage defect
acceptance level to be mutually established by Customer and Sony prior to start
of mass production, regardless of whether such failure could be considered a
warranty failure.
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