EXHIBIT 10.16
PRODUCT JOINT DEVELOPMENT AGREEMENT
This Agreement is made as of January 21 , 1997 (Effective Date) by and between
Toshiba Corporation, a Japanese corporation, with executive offices at 1-1,
Shibaura 1-chome, Xxxxxx-xx, Xxxxx 000-00, Xxxxx ("Toshiba") and NeoMagic
Corporation ("NeoMagic"), a Delaware corporation, with offices at 0000 Xxx
Xxxxxx, Xxxxx Xxxxx, Xxxxxxxxxx 00000.
RECITALS
Whereas, NeoMagic or its wholly (100%) owned companies (including but
not limited to NeoMagic International Corporation, hereinafter referred to as
"Associated Companies") have developed and own certain proprietary semiconductor
technologies enabling the integration of microcontroller logic cells and memory
cells on a single semiconductor device as well as certain proprietary
technologies with respect to microcontroller logic cell itself;
Whereas, Toshiba has developed and owns certain proprietary
technologies with respect to memory modules; and
Whereas, NeoMagic desires to collaborate with Toshiba and Toshiba is
ready to accept to collaborate with NeoMagic to jointly develop integrated
circuit chip by using of both technologies, under the terms and conditions of
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and
conditions contained herein, the parties agree as follows:
PART I
DEFINITIONS
I.1 "Cell Set Library" means a number of primitive logic elements, such as
invertors, buffers, NAND, AND, NOR, XOR, SNOR, AND/OR and OR/AND
gates, adders muxs, comparators, latches and flip-flops, all designed
using a fixed cell height so as to be usable with commercially
available standard cell automatic place and route software tools.
I.2 "DRAM Module" means a 20Mbit or larger dynamic random access memory
module designed on Toshiba's proprietary 64M DRAM second generation
process and developed hereunder by Toshiba.
I.3 "Logic Portion" means collectively the logic circuity described in
Exhibit III.
I.4 "Product(s)" means the integrated circuit chip (whether in bear wafer
or assembled) to be jointly developed by NeoMagic or its Associated
Companies and Toshiba hereunder, which chip is to include a DRAM
Module and Logic Portion in a single chip.
Confidential Treatment Requested
PART II
DEVELOPMENT OF PRODUCTS
II.1 Soon after the Effective Date, both parties shall discuss and
establish a schedule including interim milestones for the development
of Products to be performed in accordance with the procedures
described in this Part II, which schedule may be modified or adjusted
upon mutual agreement of both parties. Both parties shall use their
good faith, reasonable best efforts to develop the Products and to
provide the other party with the results of its development efforts
such as appropriate design database and situation environments, in
accordance with such schedule.
II.2 Toshiba shall provide NeoMagic with Toshiba's technical information
for HSO. 4um base dRAMASIC, as listed in Exhibit I attached hereto,
and which Toshiba deems reasonably necessary for the joint development
activities contemplated hereunder.
II.3 Upon receipt of the above design rules and technical information from
Toshiba, NeoMagic or its Associated Companies shall develop Cell Set
Libraries (except those already developed by Toshiba, if any).
II.4 Toshiba shall develop DRAM Module of the Products in accordance with
the target specifications of the DRAM Module as set forth in Exhibit
II attached hereto, and shall deliver to NeoMagic the design
information of the so-developed DRAM Module.
II.5 Upon receipt of the design information of DRAM Module from Toshiba,
NeoMagic or its Associated Companies shall develop the Logic Portion
using the Cell Set Libraries developed under Article 2.3 above, in an
appropriate manner so that DRAM Module developed by Toshiba pursuant
to Article 2.4 above can be merged into the developed Logic Portion to
constitute a whole Product, and shall provide Toshiba with mask
database, and specification and any design information, as set forth
in Exhibit III attached hereto, of the so-developed Logic Portion.
II.6 Upon receipt of the mask database and other necessary information from
NeoMagic or its Associated Companies, Toshiba shall merge its
developed DRAM Module into such database, and eventually create final
mask database of Products. Toshiba will also manufacture, test and
supply to NeoMagic prototype wafers of Products. NeoMagic shall bear
only the cost of production for sorted and memory-repaired wafers
received by NeoMagic from Toshiba and the cost of the final mask
production.
II.7 From time to time as appropriate in the course of the development
activities hereunder, each party shall provide the other party with
additional technical information to the extent it deems reasonably
necessary for such other party to conduct the activities contemplated
hereunder.
II.8 Unless otherwise specified herein, each party shall bear any and all
of its own costs and expenses incurred in connection with the
development activities contemplated hereunder.
PART III
SUPPLY OF PRODUCTS
III.1 Toshiba will warrant that it has made best efforts to ascertain that
the prototype wafers of products to be supplied under Article 2.6
conforms to mask database and other design information provided by
NeoMagic or its Associated Companies. Toshiba's obligation in case
said warranty is not fulfilled shall only to make reasonable efforts
to deliver conforming prototype wafers to NeoMagic or, at Toshiba's
sole discretion, to refund to NeoMagic the applicable costs paid to
Toshiba by NeoMagic under Article 2.6 with respect to said prototype
wafers. THE WARRANTY SET FORTH HEREIN IS INCLUSIVE, AND TOSHIBA HEREBY
DISCLAIMS ALL OTHER WARRANTIES IN RELATION TO THIS AGREEMENT, WHETHER
EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO ANY WARRANTIES OF
RELIABILITY, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE, OR
NON-INFRINGEMENT, OR WARRANTIES ARISING FROM A COURSE OF DEALING,
USAGE, OR TRADE PRACTICE REGARDING PROTOTYPE WAFERS OF PRODUCTS.
III.2 Toshiba will supply to NeoMagic wafers in commercial production to be
used for the manufacture of Products by NeoMagic under a separate
wafer supply agreement to be executed between Toshiba and NeoMagic,
and the terms and conditions to be applied and govern such
transactions shall be set forth therein in detail.
III.3 NeoMagic shall purchase wafers for the Products only from Toshiba
(including its subsidiaries), and Toshiba (including its subsidiaries)
shall supply such wafers as finished Products only to NeoMagic or at
the order of NeoMagic. NeoMagic and its Associated Companies otherwise
have the exclusive right (even with respect to the Toshiba and its
subsidiaries) to sell and control the sale of Products.
PART IV
INTELLECTUAL PROPERTY RIGHTS
IV.1 Technical Information. All intellectual property and related rights in
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and to technical information of either party (including the Associated
Companies) which is provided to the other party in the course of the
development of the Product(s) or its portion hereunder shall continue
to belong to such providing party. Especially, all intellectual
property and related rights in and to Toshiba's design rules and
process information shall continue to belong to Toshiba.
IV.2 Intellectual Property. All patents and other intellectual property and
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related rights in and to all inventions made and technical information
developed solely by NeoMagic or its Associated Companies in the course
of the development efforts hereunder ("NeoMagic's Inventions") shall
belong exclusively to NeoMagic or its Associated Companies. All patent
and other intellectual property and related rights in and to all
inventions made and technical information
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developed solely by Toshiba in the course of the development efforts
hereunder ("Toshiba's Inventions") shall belong exclusively to
Toshiba. All patents and other intellectual property and related
rights in and to all inventions made and technical information
developed jointly by NeoMagic or its Associated Companies and Toshiba
shall be jointly owned by NeoMagic or the pertinent Associated Company
and Toshiba. Subject to the provisions of Section 3.3, each party
(including the Associated Company if the Associated Company is a joint
owner) has the right to grant licenses to any third party without
accounting to the other party (including the Associated Company if the
Associated Company is a joint owner).
IV.3 Product Rights. Title to and interest in mask work rights shall be
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owned by NeoMagic for the Logic Portion of the Products. Title to and
interest in mask work rights shall be owned by Toshiba for the DRAM
Module in the Products. Subject to Toshiba's mask work rights set
forth above, NeoMagic shall retain ownership of the masks and
Products. This Agreement shall not be construed as granting or
conferring any intellectual property rights of Toshiba or NeoMagic
specified in Part IV of this Agreement or with respect to the Products
except as specified herein.
PART V
USE OF TECHNOLOGIES
V.1 NeoMagic and its Associated Companies hereby grants to Toshiba a right
to use any technical information disclosed to Toshiba hereunder,
NeoMagic's or its Associated Companies' Inventions and any and all of
its intellectual property rights with respect thereto, solely (i) to
design, and develop or have developed by its subsidiaries Products as
stipulated under Part II; and (ii) to manufacture or have manufactured
by its subsidiaries, and sell to NeoMagic Products.
V.2 Toshiba hereby grants to NeoMagic and its Associated Companies a right
to use any technical information disclosed to NeoMagic or its
Associated Companies hereunder, Toshiba's Inventions and any and all
of its intellectual property rights with respect thereto, to design
and develop Products as stipulated under Part II.
PART VI
GENERAL PROVISIONS
VI.1 Confidentiality
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(a) Confidential Information. "Confidential Information" means
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any confidential technical data, trade secret, know-how or other
confidential information disclosed by any party (including the
Associated Companies) hereunder in writing, orally, or by drawing
or other form and which shall be marked by the disclosing party
as "Confidential" or
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"Proprietary". If such information is disclosed orally, or
through demonstration, in order to be deemed Confidential
Information, it must be specifically designated as being of a
confidential nature at the time of disclosure and reduced in
writing and delivered to the receiving party within ten (10) days
of such disclosure.
(b) Exclusions. Notwithstanding the foregoing, Confidential
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Information shall not include information which:
(i) is known to the receiving party at the time
of disclosure or becomes known to the receiving party
without breach of this Agreement;
(ii) is or become publicly known through no
wrongful act of the receiving party or any subsidiary of
the receiving party;
(iii) is rightfully received from a third party
(excluding the Associated Companies) without restriction
on disclosure;
(iv) is independently developed by the receiving
party or any of its subsidiary;
(v) is furnished to any third party (excluding
the Associated Companies) by the disclosing party without
restriction on its disclosure;
(vi) is approved for release upon a prior written
consent of the disclosing party;
(vii) is disclosed pursuant to judicial order,
requirement of a governmental agency or by operation of
law.
(c) Nondisclosure. The receiving party agrees that it will
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not disclose any Confidential Information to any third party
(except that Toshiba may disclose Confidential Information to its
subsidiaries for purposes relating to this Agreement provided
that they shall hold such information in confidence) and will not
use Confidential Information of the disclosing party for any
purpose other than for the performance of the rights and
obligations hereunder during the term of this Agreement and for a
period of five (5) years thereafter, without the prior written
consent of the disclosing party. The receiving party further
agrees that Confidential Information shall remain the sole
property of the disclosing party and that it will take all
reasonable precautions to prevent any unauthorized disclosure of
Confidential Information by its employees. No license shall be
granted by the disclosing party to the receiving party with
respect to Confidential Information disclosed hereunder unless
otherwise expressly provided herein.
(d) Return of Confidential Information. Upon the request of
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the disclosing party, the receiving party will promptly return
all Confidential information furnished hereunder and all copies
thereof.
(e) Publicity. The parties agree that all publicity and
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public announcements concerning the formation and existence of
this Agreement shall be jointly planned and coordinated by and
among the parties. Neither party shall disclose any of the
specific terms of this Agreement to any third party without the
prior written consent of the other party, which consent shall not
be withheld unreasonably. NeoMagic will be responsible for all
communications with NeoMagic's customers concerning the subject
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matter hereof. Notwithstanding the foregoing, any party may
disclose information concerning this Agreement as required by the
rules, orders, regulations, subpoenas or directives of a court,
government or governmental agency, after giving prior notice to
the other party.
(f) Remedy for Breach of Confidentiality. If a party breaches
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any of its obligations with respect to confidentiality and
unauthorized use of Confidential information hereunder, the non-
breaching party shall be entitled to equitable relief to protect
its interest therein, including but not limited to injunctive
relief, as well as money damages notwithstanding anything to the
contrary contained herein.
VI.2 Term and Termination.
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(a) This Agreement shall become effective on the Effective
Date and shall remain in force for three (3) years thereafter
unless it is earlier terminated by either party in accordance
with the following.
(b) Either party may terminate this Agreement with immediate
effect, at its sole discretion, upon giving written notice to the
other party, in case:
(i) the other party defaults in the performance of any
material obligation hereunder, and if any such default is
not corrected within ninety (90) days after the defaulting
party receives written notice of such default from the
non-defaulting party,
(ii) the normal conduct of business of the other party
as a commercial enterprise ceases or is substantially
altered for any reason, or
(iii) the other party files a petition in bankruptcy, or
is adjudicated bankrupt, or makes a general assignment for
the benefit of creditors, or becomes insolvent, or is
otherwise unable to meet its business obligations for a
period of three (3) consecutive months.
(c) Upon expiration or termination of this Agreement, all
rights and obligations hereunder shall terminate forthwith except
the provisions of Parts III, IV, V and VI.
VI.3 Force Majeure. Either party shall not be liable to the other for
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failure to perform any part of this Agreement, except for any due
payment obligation, when such failure is due to fire, flood, strikes,
labor troubles or other industrial disturbances, inevitable accidents,
war (declared or undeclared),embargoes, blockages, legal restrictions,
governmental regulations or orders, riots, insurrections, or any cause
beyond the control of such party. However, the party so prevented from
performance shall use diligent efforts to resume performance. This
Agreement shall not be regarded as terminated or frustrated as a
result of such failure of performance that does not exceed six (6)
months, and the parties shall proceed under this Agreement when the
causes of such non-performance have ceased or have been eliminated.
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VI.4 Assignment. The parties shall not assign or transfer this Agreement,
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in whole or in part, or any right or obligation hereunder to any third
party without the prior written consent of the other party.
Notwithstanding the foregoing, in no event shall an initial public
offering of NeoMagic, or any Associated Company, pursuant to the
United States Securities Act of 1933 be considered an assignment of
this Agreement or otherwise result in the termination of this
Agreement. Subject to the foregoing, this Agreement and the parties'
rights and obligations hereunder shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and
assigns.
VI.5 Governing Law. This Agreement will be interpreted and enforced in
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accordance with the laws of Japan without reference to conflicts of
law principles.
VI.6 Arbitration. Each party will make reasonable best efforts to resolve
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amicably any disputes or claims under this Agreement among the
parties. In the event that a resolution is not reached among the
parties within thirty (30) days after written notice by any party of
the dispute or claims, the dispute or claim shall be finally settled,
(i) if brought by Toshiba, by binding arbitration in San Jose,
California, and (ii) if brought by NeoMagic, by binding arbitration in
Tokyo, Japan. Such arbitration shall be conducted under the Rules or
Conciliation and Arbitration and auspices of the International Chamber
of Commerce Court of Arbitration by three (3) arbitrators appointed in
accordance with such rules. The award of arbitration shall be final
and binding upon both parties, and judgment on the award rendered by
the arbitrators may be entered in any court having jurisdiction
thereof. Any monetary award shall be payable in United States dollars.
VI.7 Export Controls. Toshiba and NeoMagic acknowledge that they are each
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subject to regulation by agencies of the U.S. and Japanese
Governments, including the U.S. Department of Commerce which prohibit
export or diversion of certain products and technology to certain
countries. Any and all obligations of the parties to provide technical
information, technical assistance, any media in which any of the
foregoing is contained, training and related technical data
(collectively, "Data") shall be subject in all respects to such United
States and Japanese laws and regulations as from time to time govern
the license and delivery of technology and products abroad by persons
subject to the jurisdiction of the United States, including the Export
Administration Act of 1979, as amended, any successor legislation, and
the Export Administration Regulations issued by the Department of
Commerce, International Trade Administration, Bureau of Export
Administration. Neither party shall export or re-export, directly or
indirectly, any technical information, including software, furnished
hereunder or any direct products thereof, to any destination of the
U.S.A. and/or Japan, including the U.S. Export Administration
Regulations, without prior written authorization from the appropriate
governmental authorities.
VI.8 Notice. Any notice required or permitted to be given under this
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Agreement shall be delivered (i) by hand, (ii) by registered or
certified mail, postage prepaid, return receipt requested, to the
following addresses of the other party, or to such other addresses as
a party may designate by written notice in accordance with this
Section 6.9 by overnight courier, or (iii) by electronic
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transmission with confirming letter mailed under the conditions
described in (ii). Notice so given shall be deemed effective when
received or if not received by reason or fault of addressee, when
delivered.
If to Toshiba, to:
Xxxxxxxx Xxx
General Manager
International Operations
Electronic Components
Toshiba Corporation
1-1, Shibaura 1-chome
Xxxxxx-xx, Xxxxx 000-00
Xxxxx
If to NeoMagic, to:
Xxxxxxx Xxxxxxx
NeoMagic Corporation
c/o Caledonian Bank & Trust Ltd.
Ground Floor
Caledonian House
Xxxx Street
P.O. Box 1043
Georgetown, Grand Cayman, B.W.I.
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxxx
VI.9 Relationship of Parties. The relationship between NeoMagic and
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Toshiba under this Agreement is that of independent contractors and
neither shall be, nor represent itself to be, the joint venture,
franchiser, franchisee, partner, broker, employee, servant, agent, or
representative of the other for any purpose whatsoever. No party is
granted any right or authority to assume or create any obligation or
responsibility, express or implied, on behalf of, or in the name of,
another party or to bind another in any matter or thing whatsoever.
VI.10 Waiver. Should any of the parties fail to exercise or enforce any
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provision of this Agreement or to waive any rights in respect thereto,
such waiver or failure shall not be construed as constituting a
continuing waiver or a waiver of any other right.
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VI.11 Severability. In the event that any provision or provisions of this
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Agreement shall be held to be unenforceable, the parties shall
renegotiate those provisions in good faith to be valid, enforceable
substitute provisions which provisions shall reflect as closely as
possible the intent of the original provisions of this Agreement. If
the parties fail to negotiate a substitute provision, this Agreement
will continue in full force and effect without said provision and will
be interpreted to reflect the original intent of the parties.
VI.12 Entire Agreement. This Agreement, including the Exhibits referred to
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herein and attached hereto sets forth the entire understanding of the
parties, and supersedes any prior agreement between or among the
parties with respect to the subject matter hereof. In case of any
conflicts between this Agreement and any purchase orders, acceptances,
correspondence, memorandum, listing sheets or other documents forming
part of any order for Products, this Agreement shall govern. This
Agreement shall not be amended or modified except by written
instrument signed by the duly authorized representatives of the
parties hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
by their duly authorized representatives or officers, effective as of the
Effective Date.
Toshiba Corporation NeoMagic Corporation
By: /s/ XXXXXXXX XXX By: /s/ XXXXXXX XXXXXXX
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Name: Xxxxxxxx Xxx Name: Xxxxxxx Xxxxxxx
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General Manager International CEO President
Operations, Electrical Components Toshiba
Title: Title:
Date: Date:
Exhibits.
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I. Toshiba's Technical Information
II. DRAM Module Specification
III. Logic Portion Specification
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EXHIBIT I
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Toshiba's Technical Information
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Design Rule
SPICE Parameters
DRAM Core Size
Pin Configuration for DRAM Portion
Test Items for DRAM Portion
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EXHIBIT II
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DRAM Module Specification
[*]
[*] Confidential Treatment Requested
EXHIBIT III
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Logic Portion Specification
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The "Logic Portion" is the logic circuitry necessary to realize the graphics
controller function and the input-output circuits (and associated circuits
thereof) of the Product(s) developed by NeoMagic or its Associated Companies
hereunder. The "Logic Portion" includes analog components developed by NeoMagic
or its Associated Companies hereunder.
