Exhibit 10.14
DEVELOPMENT AND PROMOTION AGREEMENT
THIS DEVELOPMENT AND PROMOTION AGREEMENT is entered into on March 31, 1999
("Effective Date") by and between Taiwan Semiconductor Manufacturing Company
Ltd., a company duly incorporated under the laws of Republic of China having its
principal place of business at ▇▇. ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇, Science Based Industrial
Park, Hsinchu, Taiwan, ROC ("TSMC"), and Monolithic System Technology, Inc., a
company duly incorporated under the laws of the State of California having its
principal place of business at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇.▇.▇.
("MoSys"), collectively referred to as "Parties".
WHEREAS, MoSys desires to adapt and port certain of its semiconductor circuits
and devices to be compliant to certain TSMC process technologies (the "Virtual
Component"); and
WHEREAS, Parties desire to jointly promote and/or distribute the Virtual
Component pursuant to the terms and provisions as provided in this Agreement.
NOW THEREFORE, the Parties hereto agree as follows:
I. VIRTUAL COMPONENT DELIVERABLES AND TAPE-OUT
1.1 MoSys agrees to develop the Virtual Component for TSMC as specified in
Exhibit A. MoSys agrees to deliver to TSMC the information specified in the
Exhibit A and the following deliverables regarding each Virtual Component (the
"MoSys's Deliverables"). MoSys authorizes TSMC to use MoSys's Deliverables for
tape-out, production and packaging of thirty (30) testchips ("Prototypes") by
TSMC:
GDSII files
DRC / LVS report files
Virtual Component Size
Virtual Component Datasheet
Methodology and solution for pre-fabrication simulation
(including simulation models, and testability on silicon)
The GDSII file may contain only those errors acceptable to TSMC. If not
acceptable, TSMC will so notify MoSys, in writing, and MoSys shall promptly
review and correct the unacceptable errors and resubmit the file to TSMC. MoSys
shall identify, in writing and with specificity, each and every separate and
individual Virtual Component contained in the GDSII File.
1.2 For the purposes of this Agreement, TSMC agrees to provide the
following information to MoSys upon request:
Design rules
SPICE models
DRC command files
Maximum permissible test chip die size
Layout mapping file
Test chip tape-out schedule
1.3 Upon completion of tapeout, TSMC will fabricate and package thirty (30)
testchips incorporating this Virtual Component for MoSys on its next available
"hot run". TSMC shall provide MoSys one engineering iteration upon request.
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II. VERIFICATION REPORT AND JOINT MARKETING
2.1 MoSys agrees to start its own verification and qualification procedure
on the Prototypes produced by TSMC, and, within 60 days after receiving the
Prototypes, MoSys shall prepare and provide a verification report for the
Virtual Component to TSMC which shall include the information as outlined in the
Exhibit B (the "Verification Report").
2.2 Parties shall cooperate in jointly publishing the availability of the
Virtual Component on TSMC's processes, including making datasheets available for
the Virtual Component and a white paper describing the technology and benefits
to customers.
III. DISTRIBUTION OF THE VIRTUAL COMPONENT
3.1 Both TSMC and MoSys will actively promote the Virtual Component to
customers of both Parties. All customers who desire to use the Virtual Component
may obtain it through either TSMC or MoSys directly. Both Parties agree to
inform customers that they shall only use the TSMC process-ported version of the
Virtual Component for tape-out and production exclusively at TSMC or its
designated facility. Neither party shall be forced to accept the other party's
customers.
3.2 TSMC may incorporate the Virtual Component as specified in Exhibit A in
customer designs following execution of a license agreement between TSMC and
MoSys that contains payment provisions for fees of 5% of net wafer sales for
wafers that include the Virtual Component, where the term "net wafer sales" will
be defined. TSMC shall not release the GDSII physical view to customers, but may
provide an abstract for place and route purposes.
3.3 TSMC and MoSys agree to enter into good faith discussions on the
licensing terms (including, but not limited to NRE and running royalty rates)
for variants (changes to memory size, organization or process) of the Virtual
Component as well as 1T-SRAM memory compilers, if required by customer demand.
IV. PAYMENT
4.1 TSMC agrees to pay MoSys the sum of Thirty Thousand Dollars
($30,000.00) within thirty (30) days upon the first tapeout of a testchip
incorporating the Virtual Component. TSMC agrees to pay MoSys an additional sum
of Thirty Thousand Dollars ($30,000.00) within thirty (30) days of a successful
completion of evaluation of testchips including the Virtual Component by MoSys
and the delivery of the Verification Report to TSMC.
4.2 Either TSMC or MoSys may offset any due payment to the other party if
the receiving party has an outstanding balance owed to the other party at the
time that payment is due.
4.3 The Parties agree that this Agreement does not oblige TSMC to pay an
additional royalty to MoSys when customers have executed license agreements
directly with MoSys for the Virtual Component.
V. PROPRIETARY INFORMATION
5.1 The term "Proprietary Information" shall mean any information provided
by a party hereto identified as proprietary and/or confidential and disclosed to
the other party according to this Agreement. Written Proprietary Information
shall be clearly marked "Confidential" or "Proprietary". All oral disclosures of
Proprietary Information shall be identified as such prior to disclosure and
confirmed in writing by the disclosing party within thirty (30) days of the oral
disclosure. In case of disagreement, the receiving party must make a written
objection thereto within thirty (30) days after receipt of the information, or
after receipt of written confirmation for orally disclosed information. The
terms and conditions of this agreement are Proprietary Information. The
Proprietary Information shall not include information that: (1) is now or
subsequently in the public domain or otherwise becomes available to the
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public other than by breach of this Agreement by the receiving party; (2) has
been rightfully in the receiving party's possession prior to receipt from the
disclosing party; (3) is rightfully received by the receiving party from a third
party; and (4) is independently developed by the receiving party without use of
any proprietary information or trade secrets of the disclosing party, and is
authorized by the disclosing party to be disclosed or released.
5.2 Both Parties hereto agree to maintain Proprietary Information in strict
confidence, not to make use thereof other than for the performance of this
Agreement, to release it only to employees who have a reasonable need to know
the same, and not to release or disclose it to any third party, without the
prior written consent of the disclosing party.
5.3 All Proprietary Information and any copies thereof shall remain the
property of the disclosing party. Upon expiration or termination of this
Agreement, or at the request of the disclosing party, the receiving party shall
return the original and all copies of Proprietary Information in tangible forms,
or at the sole option of the disclosing party destroy any and all copies,
partial or complete, in whatever media, and provide certification in writing
signed by an officer of the company that such destruction of such information
has been completed.
5.4 Parties acknowledge and agree that due to the unique nature of the
Proprietary Information, there can be no adequate remedy at law for any breach
of the obligations hereunder, that any such breach may result in irreparable
harm to the non-breaching party, and therefore, that upon any such breach or any
threat thereof, the non-breaching party shall be entitled to appropriate
equitable relief in addition to whatever remedies it might have at law.
5.5 This Section 5 shall survive the termination or expiration of this
Agreement for a period of five (5) years.
VI. LIMITED LIABILITY
6.1 NEITHER PARTY SHALL BE LIABLE WITH RESPECT TO ANY SUBJECT MATTER OF
THIS AGREEMENT UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER THEORY
FOR ANY SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES.
VII. WARRANTY AND INDEMNIFICATION
7.1 MoSys hereby warrants and represents that the Virtual Component was and
will be developed by MoSys, and/or that it has the right and authority to
authorize TSMC to use the Virtual Component as set forth herein.
7.2 MoSys agrees to indemnify, hold harmless and defend TSMC from and
against any and all damages, costs and expenses, excluding indirect, incidental,
or consequential damages, incurred in connection with a claim that the
Prototypes infringe on any valid patent, copyright, or any other intellectual
property right.
VIII. INTELLECTUAL PROPERTY OWNERSHIP
8.1 All worldwide rights, titles and interests, including without
limitation all intellectual property rights, in and to the information,
specifications, and other materials provided by one party to the other party
under this Agreement shall remain the sole and exclusive property of the one
party. No licenses are granted herein, and neither party shall have any rights
in the intellectual property rights of the other, whether express, implied,
arising by estoppel or otherwise.
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IX. TERM AND TERMINATION
9.1 This Agreement shall have an initial term of two (2) years from the
Effective Date and it shall be automatically renewed for successive one (1) year
terms unless one party gives another party a written notice 30 days prior to the
expiry of the term then in effect.
9.2 This Agreement may be early terminated by either party if the other
party (1) breaches any material provision of this Agreement and does not cure or
remedy such breach within thirty (30) days after receipt of the notice of breach
from the other party; (2) becomes the subject of a voluntary or involuntary
petition in bankruptcy or any proceeding relating to insolvency, receivership,
liquidation, or composition for the benefit of creditors if such petition or
proceeding is not dismissed with prejudice within sixty (60) days after filing.
Termination of this Agreement shall be effective 30 days after issuance of a
written notice of termination to the other party by the nondefaulting party.
9.3 Termination of this Agreement for any reason shall not affect (1) the
obligations accruing prior to the effective date of termination; and (2) any
obligations under Sections IV, V, VI, VII and VIII hereof, all of which shall
survive termination or expiry of this Agreement.
9.4 Upon expiration or termination of this Agreement, both Parties shall
immediately cease using the other party's name or goodwill to promote the
Virtual Component.
X. EXPORT CONTROL
10.1 TSMC and MoSys are subject to national export control regulations of
the Republic of China and United States of America. TSMC and MoSys will take all
appropriate measures not to violate these regulations and will keep the other
party fully harmless from all damages arising out of or in connection with any
violation.
XI. MISCELLANEOUS
11.1 Neither party shall be responsible for any failure to perform under
this Agreement, if such failure is caused by unforeseen circumstances or due to
causes beyond its reasonable control, including but not limited to acts of God,
riot, labor stoppages, acts of civil and military authorities, fire, floods or
accidents.
11.2 This Agreement shall be governed by and construed in accordance with
the laws of the State of California, USA. In the event of any dispute arising
out of or in connection with this Agreement which cannot be amicably settled by
Parties hereto, Parties agree to submit any such dispute to a binding
arbitration in English in San Jose, California in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. The arbitration shall
be before three (3) arbitrators, one to be selected by each party and the third
to be selected by the two selected arbitrators. Each party shall bear its own
expenses for the arbitration. The award rendered by the arbitration shall be
final and binding upon all Parties, and may be enforced in any court of
competent jurisdiction. Parties, their representatives, other participants and
arbitrators shall hold the existence, content and result of the arbitration in
confidence. Nothing in this Section shall be construed to preclude any party
hereto from seeking provisional remedies, including, but not limited to,
temporary restraining orders and preliminary injunctions from any court of
competent jurisdiction, in order to protect its rights pending arbitration. All
information relating to or disclosed by any party in connection with the
arbitration shall be treated by Parties and the arbitration panel as Proprietary
Information and no disclosure of such information shall be made by either party
or the arbitration panel without the prior written consent of the disclosing
party.
11.3 No waiver of any breach or failure by either party to enforce any
provision of this Agreement shall be deemed a waiver of any other or subsequent
breach or a waiver of future enforcement of that or any other provision.
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11.4 No modification, alteration or amendment of this Agreement shall be
effective unless in writing and signed by both Parties.
11.5 In the event that any provision of this Agreement shall be determined
to be illegal or unenforceable, that provision will be limited or eliminated to
the minimum extent necessary so that this Agreement shall otherwise remain in
full force and effect and enforceable.
11.6 Neither party shall have any right or ability to assign, transfer, or
sublicense any obligations or benefit under this Agreement without the written
consent of the other except that a party (i) may assign and transfer this
Agreement and its rights and obligations hereunder to any third party who
succeeds to substantially all of its business or assets, (ii) may assign or
transfer any rights to receive payments hereunder, or (iii) in order to perform
its obligations under this Agreement, a party may assign to a sub-contractor who
shall be subject to confidentiality obligations and with the other party's prior
approval. The party who assigns to such sub-contractor shall be fully
responsible to the other party for the acts of such sub-contractor.
11.7 The relation of Parties hereto is that of independent contractors, and
neither party is an employee, agent, partner or joint venture of the other.
IN WITNESS WHEREOF, Parties hereto have caused this Agreement to be duly
executed in duplicate on their behalf by their duly authorized officers and
representatives on the date given above.
Taiwan Semiconductor Monolithic System Technology, Inc.
Manufacturing Co., Ltd.
By: By:
-------------------------------- -----------------------------------
Name: Name:
Title: Title:
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