CONFIDENTIAL INFORMATION HAS BEEN
BLACKED OUT AND FILED SEPARATELY CONFIDENTIAL TREATMENT - EDITED COPY
WITH THE COMMISSION
Dated this 25th day of September 1996
Between
CHARTERED SEMICONDUCTOR MANUFACTURING LTD
And
OAK TECHNOLOGY, INC.
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AMENDMENT AGREEMENT (NO. 1)
TO
DEPOSIT AGREEMENT DATED 8 NOVEMBER 1995
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CONFIDENTIAL INFORMATION HAS BEEN
BLACKED OUT AND FILED SEPARATELY
WITH THE COMMISSION
AMENDMENT AGREEMENT (NO. 1)
THIS AMENDMENT AGREEMENT (NO. 1) is made the 25th day of September 1996, by
and between:
(1) CHARTERED SEMICONDUCTOR MANUFACTURING LTD, a company incorporated in
Singapore and having its place of business at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇, ▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ("CSM"); and
(2) OAK TECHNOLOGY, INC, a company incorporated in Delaware and having
its place of business at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America ("Customer").
WHEREAS
(A) CSM and Customer had entered into a Deposit Agreement dated 8
November 1995 (the "Deposit Agreement") for the purpose of Customer
depositing certain funds with CSM and to procure CSM to make
available to Customer certain wafer manufacturing capacity.
(B) CSM and Customer are entering into this Amendment Agreement to
effect the suspension and variation of certain provisions of the
Deposit Agreement upon the terms and conditions set out herein.
NOW THEREFORE, in consideration of the foregoing and the
mutual covenants contained herein, the Parties agree as follows:
1. INTERPRETATION
All terms and references used in the Deposit Agreement and which
are defined or construed in the Deposit Agreement but are not
defined or constructed in this Amendment Agreement shall have the
same meaning and construction in this Amendment Agreement.
2. CONDITION PRECEDENT
The provisions of Clause 4 herein, are subject to and conditional
upon the following condition precedent being satisfied, and the
provisions of Clause 4 herein shall cease to have any force or
effect if the condition precedent is not satisfied:
2.1 by [*] Customer shall tape out a [*] Logic product
("[*] Logic Product") at CSM's wafer fabrication facilities
situated in Singapore; or *Confidential treatment requested as to
redacted portions./
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CONFIDENTIAL INFORMATION HAS BEEN
BLACKED OUT AND FILED SEPARATELY
WITH THE COMMISSION
2.2 in the event Customer fails to tape out a [*] Logic
Product by [*], CSM shall grant Customer a grace period until [*]
whereupon Customer shall tape out a [*] Logic Product at CSM's
wafer fabrication facilities situated in Singapore by [*] and the
condition precedent set forth in this Clause 2 shall be deemed
satisfied. *Confidential treatment requested as to redacted
portions.
3. EFFECTIVE DATE
The Parties agree that the term "Effective Date" shall
refer to either one of the following dates:
(a) [*], if Customer tapes out a [*] Logic Product by [*] in
accordance with Clause 2.1 above; or * Confidential treatment
requested as to redacted portions.
(b) [*], if Customer tapes out a [*] Logic Product by [*] in
accordance with Clause 2.2 above. *Confidential treatment
requested as to redacted portions.
4. SUSPENSION OF CERTAIN TERMS OF DEPOSIT AGREEMENT
The parties agree that subject to the terms of this Amendment
Agreement and provided that the condition precedent set out in
Clause 2 is satisfied, for the period from the Effective Date until [*]
(hereinafter known as the "Suspension Period"), certain provisions
of the Deposit Agreement shall be suspended and shall not apply to
the Parties and in place of the same, the following provisions
shall apply during the Suspension Period instead:
* Confidential treatment requested as to redacted portions.
4.1 CLAUSE 1 (THE DEPOSIT)
(a) Clause 1.1 shall be suspended and in its place, the
following provision shall apply:
"1.1 As at the date of this Amendment Agreement, Customer
has deposited with CSM the sum of [*](the "Deposit").
* Confidential treatment requested as to redacted
portions.
(b) Clause 1.2 shall be suspended.
(c) Clause 1.3 shall be suspended and in its place,
the following provision shall apply:
"1.3 Upon the expiry of the term of this Agreement or the
earlier termination thereof in accordance with Clause
6 or
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CONFIDENTIAL INFORMATION HAS BEEN
BLACKED OUT AND FILED SEPARATELY
WITH THE COMMISSION
Clause 7.2, CSM will return to Customer the Deposit,
without interest and subject to any deductions or refunds
made by CSM pursuant to the terms of this Agreement."
4.2 CLAUSE 2 (CSM SUPPLY COMMITMENT)
(a) Clause 2.1 shall be suspended and in its place,
the following provision shall apply:
"2.1 CSM agrees that for the duration of the Suspension
Period, CSM will make available to Customer wafer
manufacturing capacity for [*] wafers of a
sufficient quantity so that Customer is able to
utilise the [*] Deposit amount given the credit
rate set forth in Clause 5.4 below during the
Suspension Period." * Confidential treatment
requested as to redacted portions.
(b) Clause 2.3 shall be suspended and in its place,
the following provision shall apply:
"2.3 CSM reserves the right to adjust the
pricing of wafers to be supplied by CSM from time to
time depending on prevailing market conditions,
provided however that CSM shall give Customer not
less than 3 months' prior written notice of such
adjustment. In any event, the price of wafers
supplied to Customer shall be based upon then
prevailing market conditions as compared to prices
provided by other independent wafer foundries for
similar products, processes and quantities. An
"independent wafer foundry" means a company which
engages in the business of manufacturing
semiconductor integrated circuits for sale only to
third parties. Accordingly, a company which
manufactures semiconductor integrated circuits for
use in its own proprietary semiconductor products or
end-products is not considered an independent wafer
foundry."
4.3 CLAUSE 3 (CUSTOMER LOADING COMMITMENT)
Clauses 3.1, 3.2 and 3.3 shall be suspended.
4.4 CLAUSE 4 (LIQUIDATED DAMAGES)
Clauses 4.1, 4.2, 4.3, 4.4 and 4.5 shall
be suspended.
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CONFIDENTIAL INFORMATION HAS BEEN BLACKED OUT AND FILED SEPARATELY WITH THE
COMMISSION
4.5 CLAUSE 5 (SET OFF AND MAINTENANCE OF DEPOSIT)
Clauses 5.1, 5.2 and 5.3 shall be suspended and in their place; the
following provisions shall apply:-
"5.1 CSM shall be entitled to deduct from and set-off against the
Deposit, any payment falling due and remaining unpaid by
Customer under the Foundry Agreement.
5.2 At the end of each calendar quarter, CSM shall issue a written
notice to Customer stating the amount of the overdue payments
and Customer shall pay the relevant sum to CSM within 30 days of
the date of such notice, so as to maintain the Deposit at [*]
less such amounts that may have been refunded by CSM to Customer
pursuant to Clause 5.4 below. *Confidential treatment requested
as to redacted portions.
5.3 CSM's right of deduction and set-off pursuant to Clause 5.2
shall be in addition to CSM's right to claim the aforesaid
overdue payments separately as a debt due from Customer and
shall not in any way prejudice such right or any other rights or
remedies which CSM may have at law or in equity.
5.4 For the period:-
(a) [*], for every [*] Logic [*] wafer (up to [*] wafers) that
CSM ships to Customer, CSM will refund to Customer the sum
of [*] from the Deposit within 30 days from [*]
*Confidential treatment requested as to redacted portions.
(b) [*], (i) for every [*] Logic [*] wafer (up to [*] wafers)
that CSM ships to Customer, Customer is entitled to a wafer
credit of the sum of [*] from the Deposit; and (ii) for
every [*] Logic [*] wafer in excess of [*] wafers that CSM
ships to Customer, Customer is entitled to a wafer credit
of the sum of [*] from the Deposit; *Confidential treatment
requested as to redacted portions.
(c) [*], (i) for every [*] Logic [*] wafer (up to [*] wafers)
that CSM ships to Customer, Customer is entitled to a wafer
credit of the sum of [*] from the Deposit; and (ii) for
every [*] Logic [*] wafer in excess of [*] wafers that
*Confidential treatment requested as to redacted portions.
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CONFIDENTIAL INFORMATION HAS BEEN BLACKED OUT AND FILED SEPARATELY WITH THE
COMMISSION
CSM ships to Customer, Customer is entitled to a wafer
credit of the sum of [*] from the Deposit; *Confidential
treatment requested as to redacted portions.
For the purposes of clarity, the provisions set out in Clauses 5.4(b)
and (c) above are represented in the following table:-
Period No. of wafers Amount
purchased deductible
-------- -------------- ----------
The effective Date [*] [*] per wafer
to [*]
[*] and more [*] per wafer
[*] to [*] [*] [*] per wafer
[*] and more [*] per wafer
*Confidential treatment requested as to redacted portions.
(d) The wafer credits referred to in Clauses 5.4(b) and (c)
above will be paid out of the Deposit, and CSM shall issue
Customer a credit note for such wafer credits within 30
days of the date of the invoices for wafer purchases made
in accordance with Clauses 5.4(b) and (c);
(e) In no event will the aggregate amount of the refunds or
wafer credits granted to Customer pursuant to the
provisions set out in Clauses 5.4(a), (b) or (c) above
exceed the existing Deposit of [*] and *Confidential
treatment requested as to redacted portions.
(f) In the event that Embedded Memory technology is available
at CSM's wafer fabrication facilities situated in
Singapore, Customer is entitled to elect to purchase wafers
in either [*] Logic or [*] Embedded Memory or both, on the
provisions set out in Clauses 5.4(b) and (c) above. CSM
shall use best efforts to make CSM's [*] libraries
available to Customer and Customer shall be permitted to
access and utilise CSM's [*] libraries provided that such
access and utilisation shall be only to the extent that
is permitted by the relevant licensors who may have granted
CSM a license over such libraries." *Confidential treatment
requested as to redacted portions.
4.6 CLAUSE 6 (TERM AND TERMINATION)
Clause 6.1(a), (b) and (c) shall be suspended.
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CONFIDENTIAL INFORMATION HAS BEEN BLACKED OUT AND FILED SEPARATELY WITH THE
COMMISSION
4.7 ANNEX A (PAYMENT SCHEDULE)
Annex A shall be suspended.
4.8 ANNEX B (CSM SUPPLY COMMITMENT/CUSTOMER LOADING COMMITMENT)
Annex B shall be suspended except as provided in Clause 2.1 of the
Deposit Agreement.
4.9 In addition to the suspension of Clause 1.1 and Annex A of the
Deposit Agreement, provided that the condition precedent set out in
Clause 2 of this Amendment Agreement is satisfied, the Deposit
amounts due and payable by Customer on 2 January 1996, 2 January 1997
and 2 January 1998 as specified in Annex A, shall be suspended for
the duration of the Suspension Period.
4.10 The provisions of Clauses 11.1, 11.2 and 11.3 of the Deposit
Agreement are subject to the provisions of this Amendment Agreement.
5. ASSISTANCE TO TAPE OUT
CSM shall use its best efforts to provide reasonable assistance to Customer
to tape out a [*] Logic Product at CSM's wafer fabrication facilities
situated in Singapore. *Confidential treatment requested as to redacted
portions.
6. TERMINATION OF DEPOSIT AGREEMENT
6.1 Provided that the condition precedent in Clause 2 above has been
fulfilled, the Deposit Agreement shall be automatically terminated on
[*] if the Deposit is reduced to zero by [*] as a result of Customer
obtaining refunds or utilising the Deposit towards payment of wafers
in accordance with the provisions in Clause 4.5 above.
*Confidential treatment requested as to redacted portions.
6.2 In the event the Deposit is not reduced to zero by [*], all the
terms of the Deposit Agreement shall apply for the period [*] to the
expiry of the Deposit Agreement, in full force and effect without any
amendments or suspensions. *Confidential treatment requested as to
redacted portions.
7. SAVING AND INCORPORATION
7.1 Save as expressly varied by the terms of this Amendment Agreement,
the terms and conditions of the Deposit Agreement shall continue to
be in full force and effect in all other respects.
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7.2 The Deposit Agreement and this Amendment Agreement
shall be construed as one document and this Amendment Agreement
shall be deemed to be part of the Deposit Agreement. Where the
context so permits, references in the Deposit Agreement and in this
Amendment Agreement to "the Deposit Agreement" or "this Agreement"
shall be read and construed as references to the Deposit Agreement
as amended and supplemented by this Amendment Agreement.
8. GOVERNING LAW
This Amendment Agreement shall be governed by and construed in accordance
with the laws of Singapore. The Parties hereby irrevocably submit to the
non-exclusive jurisdiction of the courts of Singapore.
IN WITNESS WHEREOF the Parties have hereunto entered into this Agreement the
date first above written.
Signed by ▇▇▇ ▇▇▇▇▇▇, )
Chief Operating Officer, )
CHARTERED SEMICONDUCTOR )
MANUFACTURING LTD )
in the presence of:- ) /s/ ▇▇▇ ▇▇▇▇▇▇
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Name:
Signed by
--------------------- )
------------------------------ )
OAK TECHNOLOGY, INC. )
in the presence of:- ) /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name:
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