EXHIBIT 10.53
An
Assembly / Final Test
Subcontract Agreement
Between
CHIPPAC LTD. AND AFFILIATES., whose name and address
are stated in Section Two of the First Schedule
and
XXXXXXXXX SEMICONDUCTOR CORPORATION AND AFFILIATES
whose business registration address
is stated in Section Three of the First Schedule
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THIS AGREEMENT is made the day and year stated in Section One of the First
Schedule hereto between:
1. The Subcontractor and Affiliates whose name and address are set out in
Section Two of the First Schedule (hereafter called the "Assembler"),
And
2. Xxxxxxxxx Semiconductor Corporation and Affiliates (hereafter called
"FSC"), whose name and address are set out in Section Three of the First
Schedule.
Whereas:
1. FSC is engaged in the business of designing, manufacturing and marketing
semiconductor devices.
2. Assembler is engaged in the business of manufacturing various electronic
components and semiconductor devices.
3. This assembly agreement is applicable only to the list of packages
referenced in Section One and Two of the Second Schedule.
4. The parties mutually desire that the Assembler assemble certain integrated
circuits designed by FSC subject to the terms and conditions below.
5. The parties also mutually desire that the Assembler provide final test
service on devices listed in the Second Schedule, Section One.
NOW, THEREFORE, the parties hereto agree as follows:
1. SCOPE OF WORK
a) Assembler shall perform certain semiconductor assembly and
final test work for FSC. The semiconductor devices (hereafter
called "Devices") shall be assembled and/or tested in a good
and workmanlike manner in accordance with Assembler's standard
specifications and FSC's specific specifications.
b) The devices shall be boxed and bar code labelled to FSC
specification.
c) Notwithstanding anything contained herein to the contrary, FSC
reserves the right to engage any other subcontractor to
perform any assembly and/or final test work on a per need
basis. This agreement shall in no way be interpreted or
construed to be an exclusive dealing with the Assembler.
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2. TERMS
The term of this Agreement is as stipulated in Section Four of the
First Schedule. FSC will notify Assembler in writing 90 days prior to
the expiration of this Agreement whether or not it desires to renew
this Agreement. Should FSC desire such a renewal, then both parties
will enter into a good faith negotiation. Failure by FSC to provide
such notice to Assembler shall be deemed to be notice by FSC that it
does not desire to renew this Agreement, then Assembler should make
reasonable effort to begin a dialogue with FSC concerning the plans of
both parties.
3. DEFINITIONS
Key definitions of terms that apply in this agreement are contained in
the Fourth Schedule.
4. MATERIALS/FACILITIES
a) Assembler shall supply all materials and equipment related to
the assembly except for the items listed in Section Five of
the First Schedule.
b) Assembler shall ensure that all materials and assembly
processes used to assemble FSC's Devices are free of ODC's
(Ozone Depleting Chemicals).
c) Assembler shall be responsible for supplying the assembly and
final test facilities and all equipment (unless otherwise set
forth in this Agreement) and personnel necessary to perform
assembly and/or test work contemplated hereunder. Unless
Assembler has received FSC's prior written consent otherwise,
all assembly and/or test work shall be performed at the
facility specified in Section Two of the First Schedule
hereto. [need to add KL location to Section Two of the First
Schedule]
d) FSC agrees to accept the liability for any unique raw
materials that the Assembler has purchased for FSC's Devices,
if unused for more than 6 months beyond the forecast period
for which they were purchased or beyond the expiration date
of shelf life of the material, whichever occurs first, for a
maximum of one month of inventory plus one month on order,
provided that the Assembler has purchased this inventory
using FSC's forecast as shown in Section One of the Second
Schedule and observed reasonable lead times provided by the
vendor.
e) For standard or non-unique materials Assembler shall notify
FSC of the quantity and description of all such excess
materials on hand and shall make every reasonable effort to
mitigate the loss due to FSC's non-consumption of all such
purchased excess supplies and raw materials by attempting to
make use of such excess supplies and raw materials in the
fulfillment of other
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customers' packaging and testing orders. FSC shall be
responsible for reimbursement of up to one month inventory
plus up to one month on order for any portion not able to be
used for other Assembler customers within the expiration date
of shelf life of the materials. Any excess to this amount is
the responsibility of the Assembler.
5. ASSEMBLY PLAN
a) For information and planning purposes, FSC will provide
Assembler with a rolling 4 week forecast each week, and six
month rolling forecast at least once per monthly period with
quantities by package type (and wire count/stitch count for
TO220, DPAK & D2PAK) as shown in Section One of the Second
Schedule.
b) A new forecast ("Forecast") shall be due from FSC during the
third week of each monthly period (under FSC's fiscal year
calendar) and Assembler shall respond to the Forecast with a
capacity commitment for at least one hundred percent (100%)
firm assembly commitment for the first period within two (2)
working days as long as the Forecast for that first period
is not higher than that committed to by Assembler for the
immediately preceding period In the event of an FSC request
for additional capacity above Assembler's available capacity
then Assembler shall respond with a proposal within 5
working days. Assembler's commitment shall be based on the
monthly capacity commitment divided by the number of
Assembler's work days in the period, as a daily capacity
commit. In the event FSC does not load die in a linear
manner, then the capacity for any day for which there is
insufficient die loaded by FSC to meet the daily capacity
commit shall be subtracted from the Assemblers commitment
for the period
Additionally, for TO220, DPAK (TO251/252) and D2PAK
(TO262/263), FSC shall be obligated to load a minimum of
[redacted *] of the Base Unit Volume as shown in Attachment A
of the Second Schedule or [redacted *] of FSC's total
subcontract volume, whichever is less, assuming the demand is
based on the same or similar fit, form and functionally
equivalent design and same or similar material set as is used
on FSC's P division products or for similar products from
from other FSC divisions for which Assembler has been
qualified (either those packages and/or material sets
qualified now or any changes mutually agreed to by both
parties in the future). FSC agrees to qualify a sufficient
number of products from other divisions that can use the
same or similar design and same or similar material sets as
needed, to help insure that FSC can meet the minimum loading
guarantee. In the event that FSC's total demand for any
given package family covered by this minimum volume guarantee
is insufficient to meet [redacted *] of the Base Unit Volume,
then FSC agrees to load an equivalent volume of a mutually
a agreed to alternate package type, assuming Assembler has
sufficient capacity to load the alternate package type, and is
qualified, and assuming that [redacted *] of FSC
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cummulative Subcontract demand for all TO220, DPAK and D2PAK
package types exceeds 110% of the cumulative Threshold Volume.
Assembler agrees to make available the minimum capacity as
shown in the Fifth Schedule of this agreement, provided there
is a written forecast for consumption at least one (1) period
prior to FSC's demand. Assembler will use all commercially
reasonable efforts to provide capacity to FSC for any upside
demand. In the event that FSC adds capacity for these packages
in any FSC factory, then both parties agree to re-negotiate
pricing and loading guarantees in good faith.
Based on the Forecast provided by FSC, Assembler shall ensure
that the proportionate average daily capacity is available
each week to enable linear loading of FSC's orders, within the
Assembler's capacity commitment. FSC shall make reasonable
effort to ensure linear loading to the Assembler.
c) If Assembler starts factory program material more than thirty
(30) days ahead of customer's request date, then the Assembler
assumes liability for the total value of the product unless
the starts are authorized by FSC.
6. PRICES
a) The prices to be paid by FSC for devices assembled and/or
tested pursuant to this agreement shall be mutually agreed
to by both Assembler and FSC and set forth in a Letter
Agreement between Assembler and FSC signed by each party.
Such pricing will be expressed in U.S. Dollars. Prices shall
be negotiated on an annual basis, as a minimum, except as
otherwise noted on the Pricing Agreement or as outlined in
section 6(c) below. Updates shall be permitted when mutually
agreed upon between Assembler and FSC. Yields used in
determining the pricing shall be reviewed on an annual
basis, as a minimum. The parties shall document pricing
updates in writing.
b) All prices are to be expressed in terms of unit pricing that
include all the materials supplied by the Assembler unless
otherwise specified. Pricing shall reflect whether product is
to be standard packed in tubes or packed utilizing tape and
reel. Exceptions will be paid via SRF (Service Request Form).
c) Prices for Power Discrete Packages outlined in Attachment A of
the Letter Agreement between Assembler and FSC shall be
effective through December 31, 2002, then all Base Unit Prices
and Incremental Unit Prices shall be subject to a [redacted *]
discount from January 1, 2003 through December 31, 2003, and
thereafter shall be subject to [redacted *] prices on an
annual basis. Pricing for Unit Adders shall remain as shown
in Attachment A of the Letter Agreement between Assembler
and FSC for the life of this agreement.
Prices for IC Packages and/or test services as as outlined in
Attachment B of the Letter Agreement between Assembler and FSC
shall be effective through
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December 31, 2002, and then shall be subject to [redacted *]
prices thereafter on an annual basis Any applicable Lot
Charges for any services provided by Assembler to FSC shall be
per Attachment C of the Letter Agreement between Asembler and
FSC for the life of the agreement. In the event Assembler does
not meet [redacted *] prices after December 31, 2003, then FSC
shall not be obligated to load the minimum volumes as
specified in Section 5(b).
Any cost improvement or steps taken by FSC to reduce the
existing cost shall all accrue to FSC, and shall result in a
revised Pricing Agreement in the period immediately following
the identification, acceptance and actual implementation of
reduction by the Assembler. Assembler agrees to implement such
cost reductions as soon as is commercially viable after
acceptance provided that implementation does not require
Assembler to incur any unusual or new costs or does not
require Assembler to make additional investment in capital
equipment. In the event any such FSC cost improvement
inititiative, requires Assmelber to incur any unusual or new
costs or invest in equipment, then the parties agree to
negotiatie sharing of these costs or sharing in the cost
reduction in good faith. Any cost reduction generated by the
Assembler through the use of improved materials or improved
utilization or efficiency of equipment and/or operators being
employed shall benefit the Assembler, provided no FSC
qualification or FSC customer PCN is required. If
qualification or PCN is required by FSC for Assembler to
implement the improvement, then the parties agree to negotiate
sharing of the cost reduction in good faith . Any cost
reduction generated jointly by the FSC and Assembler through
the use of improved materials or improved utilization or
efficiency of equipment and/or operators being employed shall
benefit both parties equally, and shall result in a revised
Pricing Agreement in the period immediately following the
identification, acceptance and implementation of reduction by
the Assembler.
d) New products introduced by FSC for the Assembler to assemble
and/or final test shall be priced through mutual agreement
between FSC and Assembler. Pricing of new products shall
follow the format mutually agreed to in the Pricing Agreement
by both Assembler and FSC. Assembler shall be used as the
Preferred Subcontractor on all new package types that FSC
intends to build at Subconcontractors, subject to
[redacted *], and continued performance to FSC quality and
delivery standards, and provided that the capacity is
available when FSC requires.
7. PAYMENT TERMS
a) Payment to Assembler by FSC shall be made on a Net Thirty (30)
Days basis from the date of invoice, if not specified
otherwise in Section Three of the Second Schedule.
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b) All payments shall be made in United States dollars (US$)
unless specified otherwise in Section Three of the Second
Schedule.
8. TURNAROUND TIME
Assembler shall use its best efforts to ship Devices (assembly only or
assembly and test) in the turnaround times indicated in the Third
Schedule of this document
a) The Turnaround Time shall mean the elapsed number of calendar
days from the date of the Die or assembled unit shipment
arrives at the factory of Assembler's manufacturing location,
or date the die is requested to be built, whichever is later,
and the date assembled and / or tested Devices are shipped out
of the same factory, or if Assembler is providing PDC services
the date the finished Devices are placed into the PDC center
and available for shipment. Turnaround Time shall not include
Holidays and Sundays at Assembler's location.
9. YIELD
a) Assembler shall use its best efforts to meet the Assembly/
Test Yields defined in Section Four of the Second Schedule.
b) Assembly yield shall be measured by acceptable assembled
Devices shipped versus the number of good die the Assembler
received and shall be assessed over a calendar quarterly
period on a per package and per lead count basis. Any yield
losses due to die count variances, wafer-process or die
related losses shall be excluded from the quarterly yield
computation. Should the quarterly yield performance fall
[redacted *] below the minimum contract yeildspecified in
Section Four of the Second Schedule, Assembler shall submit
a specific explanation to FSC for review and FSC is
entiltled at a minimum, to debit Assembler's account the
dollar amount cost of the die.
c) Should the yield performance fall at least [redacted *]
below minimum contract yield that is specified in Section Four
of the Second Schedule on a lot to lot basis, Assembler shall
notify FSC immediately. A specific explanation in the standard
report format shall be submitted to FSC for review within the
next seven (7) days.
d) For assembly of untested Devices only, FSC will perform "First
Test" testing on the Devices received from the Assembler at
FSC's test location and will report the test results to
Assembler on a weekly basis, or as and when the need arises,
to assist Assembler in monitoring its assembly performance.
e) FSC reserves the right to reprocess finished goods that do not
conform to FSC specifications in an effort to maximize
utilization of its inventories.
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Procedures and pricing of any such reprocessed materials shall
be mutually agreed upon between Assembler and FSC.
f) FSC shall have the right to enter arbitration for possible
termination of this Agreement should Assembler be unable to
meet the agreed upon yield levels within ninety (90) days of
notification from FSC. Arbitration shall be per the provisions
of Section 20 of this agreement.
10. PROVISION OF DIE
a) FSC shall consign die and/or assembled units to Assembler
for assembly and/or test work.
b) Assembler shall not use uncommitted die for assembly prior to
receiving specific loading instructions from FSC or its
designated receiving location.
11. SHIPMENT
a) All shipments of die and material from FSC to Assembler will
be as shown in Section Three of the Second Schedule. FSC
agrees to be invoiced for and pay the freight costs incurred
by Assembler for any die, consigned equipment or material
provided to it by any other FSC subcontractor.
b) All shipments of assembled and/or tested Devices from
Assembler to an FSC location will be made in accordance with
Section Five of the Second Schedule. If Assembler is paying
freight on behalf of FSC then manual billing should be done on
a per shipment basis.
c) Assembler is required to use the freight forwarder nominated
by FSC for shipment of assembled Devices. Assembler shall
ensure that all export controls and licenses are in place
between Assembler's location and FSC's regional warehouses and
shipments made directly to FSC's customers per FSC's
instructions.
d) FSC shall export all die and all other materials on its own
export license to Assembler and FSC will be the importer of
record upon the return shipment of Devices through the
applicable port of entry.
12. ACCEPTANCE
a) FSC's acceptance or rejection of assembled and/or tested
Devices shall be based on the Specifications. FSC shall have
the right to reject isolated lots or groups of lots assembled
and/or tested Devices at its incoming or designated
receiving location that do not conform to the Specifications.
FSC shall
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complete acceptance testing of Devices within 30 days of
receipt from Assembler.
b) FSC shall notify Assembler of any rejections that exceeds the
AQL Limits per specifications and upon the request of
Assembler, shall promptly ship such rejected samples to
Assembler for verification, whereby such rejection shall be
limited to the corresponding lot of the samples. The lot shall
be limited to all the material produced under a specific date
code.
c) Assembler shall have seven (7) business days to reply to
FSC's notification and upon agreeing that the rejection is
caused by assembly workmanship deficiency, the rejected
lots, if reworkable, shall be returned to Assembler for
rework and Assembler will pay all associated freight costs.
If the rejected lots are non-reworkable, FSC is entitled at
a minimum, to debit Assembler's account the dollar amount in
the Assembler's original invoice. Thjs rejected quantity
shall also be adjusted on the quarterly average yields for
the period that said devices were assembled and this
adjusted yield shall be used to determine if die cost
compensation shall be due as outlined in Section 9(b).
However, the final dollar amount to be debited from the
Assembler's original invoice shall be determined by mutual
agreement between FSC and the Assembler. The preferred
method for FSC to achieve any such debit shall be for the
Assembler to issue a credit memo for the appropriate amount
to aid in reconciliation of account balances.
d) FSC shall have the right, at its expense, to employ one or
more inspectors, or professional or technical personnel or its
designees, with access to Assembler's facility to inspect the
processes, materials and FSC's Devices and to perform quality
audit. In the event that the Quality Inspector discovers any
non-compliance by the Assembler with respect to the
specifications, the Quality Inspector may, in all fairness,
suspend the manufacturing activities of the Assembler after
such non-compliance is acknowledged by the Assembler.
13. CHANGE OF SPECIFICATIONS
a) Assembler shall advise FSC in writing at least ninety (90)
days prior to making any proposed changes with respect to
direct materials, suppliers, manufacturing processes and/or
assembly location. FSC reserves the right in its absolute
discretion to accept or reject such proposed changes. Upon
obtaining the conceptual acceptance of the proposed changes
from FSC, Assembler shall perform and provide the relevant
reliability data and/or build qualification lots per FSC's
requests at Assembler's expense. Proposed changes shall be
implemented on a cut-off date mutually determined by both
parties upon obtaining final approval from FSC.
b) Assembler agrees to use its best efforts to implement all
reasonable proposals for improvement of specifications
suggested by FSC.
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c) Assembler shall use its best efforts to participate in quality
and yield enhancement programs as suggested by FSC.
d) Assembler shall not be required to implement any change where
the cost is shown to exceed the benefit anticipated unless
mutually agreed to by both parties.
e) FSC's only recourse for changes not implemented by the
Assembler, and not accepted by FSC, is to cancel unfilled
orders
14. MANUFACTURING DATA
a) Assembler shall provide FSC the manufacturing data deemed
necessary as agreed to between Assembler and FSC. It shall
include the amount at die and package level of Assembler's
die bank, WIP, and stagnant inventories. Assembler shall be
able to provide FSC on a weekly basis, a summary of shipping
activity and die receipts. Assembler shall provide FSC
weekly reports regarding assembly and test yields, as well
as cycletimes for both assembly only and assembled/tested
products at the package level. Assembler shall also provide
FSC with any other information FSC reasonably requests. The
format for stated data shall be as mutually determined
between Assembler and FSC.
b) Wherever possible, Assembler agrees to allow FSC to establish
a computer-link with the Assembler's computer system to enable
quick access to data related to FSC's Devices only. The access
to data shall be production data only and shall not include
financial data.
15. MANUFACTURING LOT
a) Assembler shall ensure that no manufacturing lot shall consist
of more than one die lot unless directed by FSC. At
Assembler's discretion, large die lots can be broken down into
smaller manufacturing lots.
b) Assembler shall try to use the unique manufacturing lot number
assigned by FSC to ensure FSC's tracking system is supported.
The lot number shall appear on the Lot Traveler together with
FSC's Device code. The Assembler shall also maintain the lot
number given by FSC to ensure FSC's tracking system is also
supported.
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16. REJECTED DIE & REJECTED ASSEMBLED UNITS
FSC may at its discretion, request all rejected die and rejected
assembled and/or tested Devices be returned by the Assembler, or
otherwise to be destroyed by the Assembler. Such destruction, if
desired, shall be witnessed by FSC personnel or alternatively, FSC may
request the Assembler to issue a letter of assurance to that effect. In
case of a return, FSC shall pay all associated freight costs.
17. U.S. EXPORT/IMPORT LAWS
Assembler shall comply with all applicable U.S. Import and Export Laws
and Regulations, as well as the local laws that are applicable at
Assembler's locations performing work for FSC. Assembler shall meet
such requirements, like Country of Origin marking on each marking on
each package as requested by FSC, in order to ensure full compliance
with such Laws. The provisions of this Section 17 shall survive the
termination of this Agreement and continue indefinitely.
18. WARRANTY
a) The assembled and/or tested Devices sold by Assembler to FSC
shall be in good condition, free of defects in material and
workmanship (except with regard to die supplied by FSC to
which Assembler warrants only workmanship) for a period of
twelve (12) months after the date of acceptance by FSC.
b) In the event of assembled and/or tested Device failure
proven (by way of failure analysis) to have been caused by
defects in workmanship, Assembler shall, at FSC's option,
issue credit for the dollars amount of the assemblers original
invoice of the relevant Devices to FSC, or assemble similar
Devices for FSC at no charge. Thjs defective quantity shall
also be adjusted on the quarterly average yields for the
period that said devices were assembled and this adjusted
yield shall be used to determine if die cost compensation
shall be due as outlined in Section 9(b).
c) Assembler shall have no obligation under any warranty set
forth above in the event that;
o the Devices have failed as a result of normal wear
and tear, catastrophe or fault or negligence of FSC
or it's customers;
o the Devices have been modified by FSC or its
customers in a way which affects the performance of
the Devices;
o the Devices have not been stored, maintained, or used
by FSC or its customers in accordance with FSC's
standard operating and/or maintenance instructions.
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d) Assembler shall not be liable or responsible for damages arising
directly or indirectly from the sale, use or failure of any
semiconductor devices assembled or tested by Assembler.
19. INSURANCE
FSC will be responsible for insurance coverage for all consigned
materials and equipment in-transit to Assembler. FSC will be
responsible for insurance on assembled and tested product shipped by
Assembler once it is transferred to FSC's designated freight forwarder.
20. INDEMNIFICATION
a) Each Party (the "Indemnifying Party"), at its own expense and
cost, shall defend any suit, claim or legal proceeding against
the other Party (the "Indemnified Party") for the infringement of
patents or trademark, or claims based on allegations of
copyright, trade secret or other proprietary right infringement,
by the Indemnifying Party. The Indemnifying Party shall pay all
damages and costs which may be awarded against the Indemnified
Party because of such infringement by the Indemnifying Party.
Assembler shall have no obligation under this section to the
extent than any alleged infringement is based on Assembler's
implementation of specifications provided by FSC, or if due to
modifications or combination with other devices by FSC or its
customers.
b) The Indemnifying Party's duties under the immediately preceding
paragraph (a) are conditional upon the Indemnified Party
furnishing to the Indemnifying Party prompt written notice of the
commencement of any suit or proceeding or any claim of
infringement and a copy of each written communication relating to
the alleged infringement, and giving to the Indemnifying Party
authority and reasonable assistance (at the Indemnifying Party's
expense and cost) to defend or settle such law suit, proceeding
or claim. The Indemnifying Party shall not be bound by any
settlement made without its prior consent.
21. TERMINATION
a) Either party may terminate this Agreement by giving notice in
writing to the other party in the event the other party is in
material breach of this Agreement and shall have failed to cure
such breach within thirty (30) days of written notice thereof
from the first party.
b) Either party may terminate this Agreement by giving notice in
writing to the other party,
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which notice shall be effective upon receipt by the other
party, should the other party file a petition of any type as
to its bankruptcy, be declared bankrupt, become insolvent,
make an assignment for the benefit of creditors, go into
liquidation or receivership or otherwise lose legal control of
its business.
c) Either party may terminate this Agreement by giving notice in
writing to the other party should an event of Force Majeure
continue for more than ninety (90) days.
d) Termination of this Agreement shall not release either party
from the obligation to make payment of all amounts then due
and payable.
e) In the event of termination, Assembler shall upon written
request of FSC return all die, materials, equipment and
technical documents FSC has previously provided to Assembler,
with freight costs to be paid by FSC.
f) Upon termination of this Agreement other than by FSC pursuant
to Section 21(a) or (b), FSC shall, and in case of termination
by FSC under Section 21(a) or (b) FSC shall have the option to
purchase from Assembler all work-in-progress (WIP), all
assembled and tested Devices in Assembler's stock at the
established contract pricing, and any raw materials in
accordance with Section 4(d) herein, provided these WIP and
Devices are assembled in accordance with the Specifications.
22. FORCE MAJEURE
Either party shall be excused from performance or performance delayed
by reason of any force majeure, strikes, accidents, embargoes, acts of
government or other cause beyond control of such party which renders
performance impossible. FSC or Assembler may, at its option, cancel or
reschedule that portion of the performance of this Agreement by such
cause. Such rescheduling shall be upon mutual consent of both parties.
If the force majeure exists for more than 3 months, FSC may terminate
this Agreement without any liability to the Assembler, and Assembler
will return all FSC's dies, WIP and Finished Goods, and any Consigned
Equipment, with freight costs to paid by the Assembler.
23. ENTIRE AGREEMENT
a) The Schedules referred to and attached to this Agreement and
the Letter Agreement between Assembler and FSC are hereby
incorporated and by this reference made a part hereof. The
relevant sections of the Schedules, whenever necessary, shall
be updated to include any changes and additional new business
plans agreed between the parties. The revised Schedules signed
by the duly authorized officers of the respective parties,
shall become the addendum of the original Schedules and by
this reference made part hereof.
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b) This Agreement, together with the Schedules hereto, contains
the entire understanding of the parties and supersedes any
prior or contemporaneous agreements or understanding between
the parties with respect to the subject matter hereof. Without
limiting the generality of the foregoing, this Agreement
supersedes and replaces in its entirety that certain Supply
Agreement and Letter Agreement between Assember and Intersil
Corporation, dated as of June 30, 2000, as partially assigned
to FSC on March 16, 2001, which Supply Agreement and Letter
Agreement shall no longer have any force or effect as between
Assembler and FSC.
c) No amendment or modification of this Agreement shall be valid
and binding upon the parties unless signed by the duly
authorized officers or representatives of the respective
parties.
24. WAIVER
Should any party fail to enforce any provision of this Agreement or to
exercise or waive any right in respect hereto, such failure or waiver
shall not be constructed as constituting a waiver or a continuing
waiver of its rights to enforce such provisions or right or any other
provision or right.
25. AGENCY
a) The relationship of the parties under this Agreement shall be
as independent contractors.
b) Nothing contained herein or done in pursuance of this
Agreement shall constitute the parties as entering upon a
joint venture or partnership, or shall constitute either party
being an employee of the other party for any purpose or in any
sense whatsoever.
26. INVALIDITY
If any provision of this Agreement or the application thereof to any
situation or circumstance shall be invalid or unenforceable, the
remainder of this Agreement shall not be affected, and each remaining
provision shall be valid and enforceable to the fullest extent. In the
event of such partial invalidity, the parties shall seek in good faith
to agree on replacing any such legally invalid provision with
provisions which in effect will, from an economic viewpoint, most
nearly or fairly approach the effect of the invalid provision.
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27. COUNTERPARTS
This agreement may be executed simultaneously in several duplicate
originals in the English Language, each of which shall be deemed an
original, but all of which shall constitute one and the same
instrument.
28. JURISDICTION
The Agreement shall be governed by, and interpreted and construed in
accordance with the Laws the State of California
29. CONFIDENTIALITY
a) For the purposes of this Agreement, "Confidential Information"
shall mean all proprietary information relating to the subject
matter of this Agreement which (1) is disclosed by one of the
parties to the other in written, graphic and/or computer data
form and originally designated in writing by the disclosing party
as "Confidentiality Information" or by words of similar import,
or (2) if disclosed orally is designated as "Confidential
Information" at such time and is summarized and confirmed in
writing within thirty (30) days after oral disclosure that such
orally disclosed information is "Confidential Information", or
(3) whether or not designated as provided in clauses (1) or (2)
above, consists of emails, letters, agreements, contracts,
request for quotations (RFQs), build diagrams, bills of
materials, test programs, product preliminary specifications,
engineering drawings of testers, fixtures and/or test jigs.
b) Each party acknowledges and agrees that all Confidential
Information is confidential or proprietary to the disclosing
party. Each party agrees not to use any such Confidential
Information during the term of the Agreement and for an
additional period of Seven (7) years for any purpose other than
as permitted or required for performance by such party hereunder.
Each party further agrees not to disclose or provide any of such
Confidential Information to any third party and to take all
necessary measures to prevent such disclosure using the same
standard of care it normally uses in protecting its own trade
secrets and proprietary information.
c) Notwithstanding any other provision of this Agreement, no
information received by a party hereunder shall be or remain
Confidential Information if the party receiving or possessing
said information can demonstrate that said information was or is,
as the case may be:
o published or otherwise made available to the public other
than as a result of a breach of this Agreement;
15
o furnished to a party hereunder by an independent
third party not in violation of a duty of
confidentiality of that third party to the other
party hereunder and without restriction on its
dissemination;
o approved for release in writing by the party
designating said information as Confidential
Information;
o known to or independently developed by the party
receiving Confidential Information hereunder without
access to the said Confidential Information;
o disclosed to a third party by the party transferring
said information hereunder without restricting its
subsequent disclosure and use by the third party.
d) Disclosure of any Confidential Information by a party hereto
shall not be precluded if such disclosure is in response to a
valid order of a court or other government body, provided that
the receiving party promptly notifies the other party of such
order and makes a good faith effort, at the expense of the
party which originally disclosed the information, to obtain,
or assist the other party to obtain, a protective order
requiring the Confidential Information so disclosed be kept in
confidence and used only for the purpose for which such order
was issued.
30. ARBITRATION
Any default condition by either party, that is not remedied and that
would lead to possible termination of this agreement are to be resolved
by Arbitration prior to termination per the requirements of this
section. This Arbitration process shall be concluded in the United
States and governed by, and construed in accordance with, the laws of
the State of California, USA. The Parties shall use their best efforts
to settle by way of amicable negotiations any differences which may
occur between them in connection with this Agreement. If the Parties
fail to reach such an amicable settlement, either party may submit such
differences to arbitration, which shall have sole jurisdiction and
shall take place in accordance with the following minimum set of
rules:
a) The rules of the International Chamber of Commerce (ICC) shall
apply.
b) The arbitration shall be held by a single arbitrator mutually
acceptable to both Parties. If the Parties cannot agree on a
single arbitrator, each Party shall identify one independent
individual who shall meet to appoint a single arbitrator.
c) The decision of the arbitrator shall be considered as a final
and binding resolution of the disagreement and may be entered
as judgment in any court of competent jurisdiction.
d) The arbitration shall be held in a mutually agreeable
location.
16
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands the day,
month and year first above written.
ChipPAC Limited
SIGNED by: In the presence of:
/s/ Xxxxxxxx X. XxXxxx /s/ Xxxxxxx X. Xxxxxx
--------------------------------------- --------------------------------
Name: Xxxxxxxx X. XxXxxx Name: Xxxxxxx X. Xxxxxx
Title: Director Title: Vice President
Date: February 8, 2002 Date: February 8, 2002
Xxxxxxxxx Semiconductor Corporation.
SIGNED by In the presence of:
/s/ Tan Xxxx Xxxx /s/ X.X. Xxx
--------------------------------------- --------------------------------
Name: Tan Xxxx Xxxx Name: X.X. Xxx
Title: Director - Strategic Procurement Title: Vice President, Operations
& Subcon Management
Date: February 18, 2002 Date: February 25, 2002
17
FIRST SCHEDULE
--------------------------------------------------------------------------------
SECTION ONE: DAY/MONTH/YEAR OF THIS AGREEMENT
--------------------------------------------------------------------------------
1st day of January, 2002
------------------------
--------------------------------------------------------------------------------
SECTION TWO: Chip PAC LIMITED & AFFILIATES
--------------------------------------------------------------------------------
Company Name: ChipPAC Limited
---------------------------------------------
Address: See Attached A for Names and Addresses
For ChiPAC Limited and Affiliates
---------------------------------------------
---------------------------------------------
Country:
---------------------------------------------
--------------------------------------------------------------------------------
SECTION THREE: XXXXXXXXX SEMICONDUCTOR CORPORATION & AFFILIATES
--------------------------------------------------------------------------------
Location Name: Xxxxxxxxx Semiconductor
---------------------------------------------
Address: 00 Xxxxxxx Xxxx Xxxx,
---------------------------------------------
Xxxxx Xxxxxxxx
---------------------------------------------
Xxxxx 00000
---------------------------------------------
U.S.A.
---------------------------------------------
--------------------------------------------------------------------------------
SECTION FOUR: TERMS OF AGREEMENT
--------------------------------------------------------------------------------
Effective Date: January 1st, 2002 Expiration Date: December 31, 2003
--------------------------------------------------------------------------------
SECTION FIVE: MATERIALS/EQUIPMENT CONSIGNED BY XXXXXXXXX
--------------------------------------------------------------------------------
See Attachment B of this First Schedule for list of equipment owned by FSC.
--------------------------------------------------------------------------------
18
ATTACHMENT A
NAMES AND ADDRESSES OF CHIPPAC LIMITED AND AFFILIATES
CHIPPAC LIMITED,
Crigmuir Xxxxxxxx,
Road Town,
Tortola,
British Virgin Islands
CHIPPAC MALAYSIA
73, Lorong Enggang,
Ulu Kelang Free Trade Xxxx,
00000 Xxxxx Xxxxxx,
Xxxxxxxx
CHIPPAC KOREA
San 000-0, Xxx-Xx,
Xxxxx-Xxx, Xxxxx-Xx,
Kyoungki-Do,
467-701 Korea
CHIPPAC SHANGHAI
188 Xxx Xx Road,
Xxxxx Xxxx,
Qinpu District,
Xxxxxxxx 000-000,
Xxxxxx Xxxxxxxx of. China
19
ATTACHMENT B
EQUIPMENT OWNED BY FSC*
EQUIPMENT TAG #
Specific Equipment List will be included in the contract.
* As of 1st day of January 2002:
Ismecca Known Good Die Machine
20
SECOND SCHEDULE
--------------------------------------------------------------------------------
SECTION ONE: VOLUME FORECAST
--------------------------------------------------------------------------------
PACKAGE LEAD PRODUCT VOLUME FORECAST
TYPE TYPE TYPE PD PD PD PD
Note: Minimum forecast for Power Discrete shall be per the Base Unit Volume
listed in Attachment A of the Letter Agreement between Assembler &
FSC.
ASSEMBLY
Minimum [redacted *] Rolling Assembly Forecast That Is Submitted Each
Period
FINAL TEST
Minimum [redacted *] Rolling Test Forecast that is submitted Each
Period
--------------------------------------------------------------------------------
SECTION TWO: PRICES
--------------------------------------------------------------------------------
PACKAGE LEAD UNIT PRICING(CENTS)
TYPE TYPE
Note: Per Price Schedule in Attachments A,B, & C of the Letter Agreement
between Assembler & FSC.
--------------------------------------------------------------------------------
SECTION THREE:
--------------------------------------------------------------------------------
PAYMENT TERM
Net 30 days from the receipt of the finished goods or from the issuance date of
Xxxx of Landing or Air Waybill in case of direct shipment to overseas from
Assembler, and for products for which supplier provides PDC services, the
payment shall be made Net 30 days from the time the finished goods are entered
into the FSC "Peouple Soft Inventory System" and placed into the PDC. Invoices
are payable in United States Dollars
DELIVERY TERM:
A) Inbound Shipment (Shipment of die and material from FSC to Assembler): CIF
Assembler factory that is providing the service
B) Outbound Shipment (Shipment of assembled and/or tested devices from
Assembler to FSC Location) shall be FOB EX-Works.
--------------------------------------------------------------------------------
21
______________
* Confidential treatment requested.
SECOND SCHEDULE
--------------------------------------------------------------------------------
SECTION FOUR: YIELDS
--------------------------------------------------------------------------------
STANDARD YIELDS REMARKS
ASSY Cum See Attachment A of this Second Schedule
Test Cum
Total Cum
--------------------------------------------------------------------------------
SECTION FIVE: SHIPMENT SENT TO
--------------------------------------------------------------------------------
1) Products:
Attention: "Ship To" addressing shall be to the persons/address
called out on the PO, Release order or other agreed to
documents from FSC
Company Name:
Address:
--------------------------------------------------------------------------------
SECTION SIX: MANUFACTURING DATA
--------------------------------------------------------------------------------
Periodic trend reports in QOS format on :
1) Yield
2) LAR/PPM
3) Cycletime
4) On time Delivery
--------------------------------------------------------------------------------
22
SECOND SCHEDULE - ATTACHMENT A
MANUFACTURING YIELD TARGETS
[redacted *]
23
_____________
* Confidential treatment requested.
THIRD SCHEDULE
CYCLE TIME TARGETS
[redacted *]
______________
* Confidential treatment requested.
24
FOURTH SCHEDULE - DEFINITIONS
1 "Affiliate" of any particular Person means any other Person directly or
indirectly controlling, controlled by or under direct or indirect common
control with such Person. For purposes of this definition, a Person shall
be deemed to be in "control" if such Person possesses, directly or
indirectly, the power to direct or cause the direction of the management or
policies of the Person in question, whether through the ownership of voting
securities, by contract or otherwise.
2 [redacted *]
3 [redacted *]
4 "Preferred Subcontractor" shall mean that Assembler shall be given the
priority to quote for any new package configurations required by FSC from a
third party contract assembler that are not of the type for which packaging
and/or test services are provided by Assembler to FSC nor provided to FSC
by other third parties as of the Effective Date. Additionally, in the event
that Assembler provides a competitive quote (including price, capacity,
leadtime, etc), then Assembler shall be given preferential consideration
for award of the business by FSC.
25
_____________
* Confidential treatment requested.
FIFTH SCHEDULE - MINIMUM CAPACITY GUARANTEE
-------------------------------------------------------------------
PACKAGES WEEKLY MIN CAPACITY
(K UNITS)
-------------------------------------------------------------------
D2PAK (TO262/263) &TO220A [redacted *]
-------------------------------------------------------------------
DPAK (TO251/252) [redacted *]
-------------------------------------------------------------------
T0220 [redacted *]
-------------------------------------------------------------------
T0202 [redacted *]
-------------------------------------------------------------------
TO218 [redacted *]
-------------------------------------------------------------------
TO247 [redacted *]
-------------------------------------------------------------------
HEXDIP [redacted *]
-------------------------------------------------------------------
TO39 HIREL [redacted *]
-------------------------------------------------------------------
26
_______________
* Confidential treatment requested.