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EXHIBIT 10.3
Dated 1 October, 1999
CHARTERED SEMICONDUCTOR MANUFACTURING LTD
- and -
HEWLETT-PACKARD EUROPE B.V.
- and -
EDB INVESTMENTS PTE LTD
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AMENDMENT AGREEMENT (NO. 2)
TO
JOINT VENTURE AGREEMENT DATED 13 MARCH 1997
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AMENDMENT AGREEMENT (NO. 2)
THIS AMENDMENT AGREEMENT (NO. 2) is made on 1 October, 1999
BETWEEN :-
(1) CHARTERED SEMICONDUCTOR MANUFACTURING LTD ("Chartered"), a company
incorporated in Singapore with its registered office at 00, Xxxxxxxxx
Xxxxxxxxxx Xxxx X, Xxxxxx 0, Xxxxxxxxx 000000;
(2) HEWLETT-PACKARD EUROPE B.V. ("HP"), a company incorporated in The
Netherlands with its principal place of business at Xxxxxxxxx 00, 0000
XX Xxxxxxxxxx, Xxx Xxxxxxxxxxx; and
(3) EDB INVESTMENTS PTE LTD ("EDBI"), a company incorporated in Singapore
with its registered office at 000, Xxxxx Xxxxxx Xxxx, #00-00, Xxxxxxx
Xxxx Xxxxx, Xxxxxxxxx 000000.
Chartered, HP and EDBI are collectively referred to herein as "Parties" and
individually referred to herein as a "Party".
WHEREAS:-
(A) The Parties have entered into a Joint Venture Agreement dated 13 March,
1997 (the "Joint Venture Agreement") for the purpose of regulating
their relationship inter se as shareholders in the joint venture
company called Chartered Silicon Partners Pte Ltd.
(B) The Parties have entered into an Amendment Agreement (No. 1) to vary
the Joint Venture Agreement with effect from 4 July, 1997.
(C) The Parties are entering into this Amendment Agreement (No. 2) to
further vary the Joint Venture Agreement with effect from the date
hereof.
IT IS AGREED as follows:-
1. INTERPRETATION
All terms and references used in the Joint Venture Agreement and which
are defined or construed in the Joint Venture Agreement but are not
defined or construed in this Amendment Agreement shall have the same
meaning and construction in this Amendment Agreement (No. 2).
2. AMENDMENT TO THE JOINT VENTURE AGREEMENT
The Parties agree that with effect from the date of this Amendment
Agreement (No. 2), the following clauses of the Joint Venture Agreement
shall be as follows:
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Clause 5(H) Meetings of Directors
5(H)(viii) None of the following actions shall be taken by the Company unless
approved by a simple majority vote of the duly represented Directors at a duly
convened meeting:-
(a) the incurring by the Company of any capital expenditure in
excess of S$10,000,000 unless included in an approved Company
Business Plan;
(b) the exercise of the Company's borrowing powers in relation to
incremental loans carrying a loan tenure exceeding one year
(other than those included in an approved Company Business
Plan), or financing from new financial institutions;
(c) the approval of any proposed annual Company Business Plan of
the Company (other than the first Company Business Plan),
provided however that in the event that the annual Company
Business Plan has not been approved prior to the commencement
of the new financial year of the Company, until a new Company
Business Plan is so approved, the Company shall be operated in
accordance with the Company Business Plan most recently
approved by the Board; and
(d) any sale, lease, transfer or other disposition of the
properties or assets of the Company other than in the ordinary
course of business of the Company.
Clause 5(I) Important Matters Requiring Board's Special Approval
(i) Subject to any requirements specified by law or by the Act, none of the
following actions shall be taken by the Company unless with the affirmative
votes of not less than three-quarters of the duly represented Directors at a
duly convened meeting:-
(a) the approval of any proposed annual Company Business Plan or
interim revision of the Company Business Plan of the Company
(other than the first Company Business Plan), if it impacts
the Company's ability to service HP's wafer requirements under
the Assured Supply and Demand Agreement provided however that
in the event that the annual Company Business Plan has not
been approved prior to the commencement of the new financial
year of the Company, until a new Company Business Plan is so
approved, the Company shall be operated in accordance with the
Company Business Plan, or interim revision of the Company
Business Plan most recently approved by the Board;
(b) the lease of any real estate for an amount in excess of
S$5,000,000 unless included in an approved Company Business
Plan, or the purchase of any real estate;
(c) the entry of the Company into new markets outside of the
Business, as defined under Clause 6(A);
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(d) any sale, lease, transfer or other disposition of the
properties or assets of the Company in excess of 20% of the
fair market value of total assets at the time of sale, lease,
transfer or other disposition, as the case may be, other than
in the ordinary course of business of the Company;
(e) the approval of, or change in, the method of computing the fee
payable under the CSM Service Support Agreement or the STPL
Group Management and Support Services Agreement unless
contemplated in an approved Company Business Plan;
(f) the termination of research and development services provided
by CSM pursuant to the CSM Service Support Agreement, or
change in the Fab Equalization policy specified in the CSM
Service Support Agreement;
(g) the exercise of any of the Company's borrowing powers in
excess of 20% of the fair market value of total assets at time
of borrowing;
(h) the entry into any major alliance unless contemplated in an
approved Company Business Plan. For the purposes of this
sub-paragraph (h) the expression "major alliance" means any
major transaction entered into by the Company other than in
the ordinary course of business (1) pursuant to which the
Company acquires or disposes of intellectual property or other
technology rights, (2) pursuant to which the Company is
restricted as a result of such transaction in the products or
services which it may provide to its customers, including HP,
or (3) which creates or grants exclusion rights to another
party or parties;
(i) the issue by the Company of any guarantee to secure the
indebtedness of any person;
(j) the incurring by the Company of any capital expenditure in
excess of 20% of the fair market value of total assets at time
of expenditure;
(k) a change in the Debt/Equity Ratio policy specified in Clause
11(B); and
(l) the approval of any proposed interim revision to the annual
Company Business Plan which is required in the event (1) there
is a negative deviation of actual net income results for a
quarter from the existing plan for that quarter which,
annualized, exceeds 10% of the paid-up share capital of the
Company or (2) there is a negative deterioration of forecasted
net income for the year from the existing annual Company
Business Plan for that year which exceeds 10% of the paid-up
share capital of the Company.
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(ii) Subject to any requirements specified by law or by the Act, none of the
following actions shall be taken by the Company unless with the affirmative
votes of each of the CSM Directors, the HP Directors and the EDBI Director duly
represented at a duly convened meeting:-
(a) the change in the authorized, issued or paid-up capital of the
Company (unless pursuant to Clauses 2(C), 3(C), 3(D), 3(E) and
4(C)) or the grant of any option over the unissued share
capital of the Company;
(b) the listing of the shares in the capital of the Company on any
stock exchange;
(c) the winding-up, liquidation or dissolution of the Company or
the merger, consolidation or reorganization of the Company
with any corporation, firm or other body;
(d) any transfer of shares held by a Shareholder in the capital of
the Company unless in accordance with Clause 10, Clause 14(B)
or the Option Agreement;
(e) the subscription for, or acquisition or disposal of, any
shares or interests in any corporation;
(f) the entry into any joint venture; and
(g) the declaration by the Company if dividends for any financial
year in excess of the lower of :-
(1) 70 per cent. of the profit after tax of the Company for
the financial year; and
(2) 50 per cent. of the retained earnings of the Company.
3. SAVING AND INCORPORATION
(A) Save as expressly amended by this Amendment Agreement (No. 2) and
Amendment Agreement (No. 1), the terms and conditions of the Joint
Venture Agreement shall continue to be in full force and effect in all
other respects.
(B) The Joint Venture Agreement, the Amendment Agreement (No. 1) and this
Amendment Agreement (No. 2) shall be construed as one document and this
Amendment Agreement (No. 2) shall be deemed to be part of the Joint
Venture Agreement. Where the context so permits, references in the
Joint Venture Agreement and in this Amendment Agreement (No. 2) to "the
Joint Venture Agreement" or "this Agreement" shall be read and
construed as references to the Joint Venture Agreement as amended and
supplemented by the Amendment Agreement (No. 1) and this Amendment
Agreement (No. 2).
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4. Governing Law
This Amendment Agreement (No. 2) shall be governed by, and construed in
accordance with, the laws of Singapore.
I N W I T N E S S W H E R E O F the parties have entered into this Amendment
Agreement (No. 2) as of the date stated above.
Chartered
SIGNED by XXXXX XXXXX )
President & CEO )
for and on behalf of )
CHARTERED SEMICONDUCTOR )
MANUFACTURING LTD )
in the presence of:- ) /s/ XXXXX XXXXX
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/s/ XXXXXX HON
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Name: Xxxxxx Hon
HP
SIGNED by XXXX X. XXXXX
General Manager, Integrated )
Circuit Business Division )
HEWLETT-PACKARD COMPANY )
for and on behalf of )
HEWLETT-PACKARD EUROPE B.V. )
in the presence of:- ) /s/ XXXX X. XXXXX
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/s/ XXXXXX XXXXX
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Name: Xxxxxx Xxxxx
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EDBI
SIGNED by LIOW VOON KHEONG
General Manager )
for and on behalf of )
EDB INVESTMENTS PTE LTD )
in the presence of:- ) /s/ LIOW VOON KHEONG
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/s/ XXXXXX XX
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Name: Xxxxxx Xx
ACKNOWLEDGED AND AGREED TO
by ANG XXXX XXXX )
General Manager )
for and on behalf of )
CHARTERED SILICON
PARTNERS PTE LTD )
Date:- 1, October 1999 ) /s/ ANG XXXX XXXX
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in the presence of:-
/s/ XXXXXX XX
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Name: Xxxxxx Xx
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