EXHIBIT 10.31
HMCD - HSS Memorandum of Agreement
Montreal Design Center
Consistent with ongoing discussions between Xxxxxx Microwave Communication
Division ("MCD") and Xxxxxx Semiconductor Sector ("HSS"), business units within
Xxxxxx Corporation, a Delaware corporation, the two parties hereby enter into a
Memorandum of Understanding ("MOU") establishing the basic business agreement
Whereas the Montreal Design Center (MDC) is expected to become an extension of
HSS' R&D capability in Canada after a period of two years, and;
Whereas at that point the MDC should have a stable operating and strategic plan,
and be a viable design center for Xxxxxx MCD Integrated Circuit requirements,
and;
Whereas HSS would then be able to add incremental resources to the MDC above and
beyond Xxxxxx MCD Integrated Circuit needs to develop Integrated Circuits for
HSS based on core competencies developed at the MDC.
THEREFORE, and in consideration of the mutual promises set forth herein, the
parties agree on the following convenants:
HSS-and MCD Roles and Responsibilities
The following items list the roles and responsibilities of each party in this
relationship:
Operating Agreements
This proposal will follow the agreements set forth in the Technology
Partnerships Canada (TPC) Project Number: 721-459846 and Project Number:
720-459847.
Physical location
The MDC will be located in the Xxxxxx MCD Montreal facilities. Sufficient office
space will be available in this facility to support planned staffing through
FY'03.
Capital Equipment
Capital equipment will be procured for the MDC using Xxxxxx MCD's capital
equipment approval process during the first two fiscal years of operation. At
the time HSS assumes financial control of the MDC, HSS will procure capital
using the HSS approval process. Such equipment would consist of items such as
Sun work stations, design verification, laboratory equipment and other equipment
defined as capital per the Xxxxxx Corporation guidelines.
Software Tools
The MDC will have access to the Cadence suite of IC software design tools
through the HSS site subscription agreement. In addition, the Cadence tools will
include access to tool libraries for all the wafer fabrication processes which
HSS supports for design-active (meaning the tool sets and processes are
maintained and up to date) processes. This includes the Taiwan Semiconductor
Manufacturing Company (TSMC) wafer fab processes at 0.6u, 0.5u and 0.35u. As
additional libraries are developed and made design-active, these will also be
made available to the MDC. Additional development tools such as Synopsis,
Hardware/Software Co-design and Co-verification tools will need to be purchased
specifically for the MDC by HMCD, as HSS has no site subscription agreement for
these tools. However, the MDC will leverage HSS' purchase agreements for
software where possible.
Management
The MDC will be directly managed by a resident on-site manager, who shall report
directly to Xxx Xxxxxxxx, Director of Engineering, HSS. The MDC manager will
also report dotted line to Xxxxx Xxxxxx, Director of Engineering, Xxxxxx MCD.
All MDC staff will report directly to the MDC manager.
Accountability
Per the TPC agreements, the MDC manager will conduct twice yearly reviews with
the Canadian government TPC liaison. In addition, detailed business plan reviews
will be held jointly with Xxxxxx MCD and HSS prior to individual IC project
approval and using the HSS design methodology (ACTPTM).
Funding
Funding for expense items and capital such as payroll, supplies, software,
training, travel, phones, workstations, personal computers, out-sourced test
development and laboratory equipment will be provided by Xxxxxx MCD through the
end of FY'01. Beginning with the start of FY'02, HSS will assume responsibility
for directly funding the MDC and HSS will allocate expenses for MCD's share of
the MDC back to HMCD through inter-company billing. HMCD agrees that in FY'02
they will purchase back services from the MDC to at least a value of 90% of the
total operating expenses of the MDC from FY'01, the previous fiscal year. HMCD
agrees that in FY'03 they will purchase back services from the MDC to at least a
value of 75% of the total operating expenses of the MDC from FY'01. This will
insure a continuity of demand from HMCD and allow HSS time to absorb the
expenses of the MDC. The budget and AOP for MDC will be approved by the General
Managers of both HSS-CPB and HMCD. HSS and HMCD agree that fiscal year funding
(Canadian dollars) for the MDC will be as follows:
FY'99 FY'00 FY'01 FY'02 FY'03
$726K $2211K $3788K $4636K $4582K
Financial Structure
A single department number will be used by the MDC for budgeting and planning
purposes. At the time which HSS assumes financial responsibility for the MDC in
FY'02, an HSS department number will be assigned and all capital, labor,
expenses items, etc. will be moved into the HSS accounting system.
Design and 1P Ownership
All IP and development work will be owned by HSS. Any release of Intellectual
Property, disclosure of development work, or data related to this agreement
shall not occur without the written consent of HSS.
Resource Staffing
The initial resource staffing will be seeded by Xxxxxx MCD. The MDC manager will
be responsible for recruiting additional staff as set forth in the staffing
plan. Staffing requests will be approved by general managers of both HSS and
Xxxxxx MCD. It is expected that virtually all initial staffing will be recruited
in the Montreal area.
Training
HSS will provide, or will facilitate training for all CAD tools and design
methodology. It is anticipated that training will occur at the HSS facility in
Palm Bay, Florida, or at the tool vendor's site. This will allow for maximum
exposure of the trainee to the HSS design methodology.
Detailed IC Design Business Plans
Each integrated circuit will require its own detailed business plan as outlined
by the HSS development process methodology. The business plans must be approved
by a Director-Engineering at HSS and a Director-Engineering at Xxxxxx MCD.
Projects deviating from the approved strategic roadmap must be approved by a
General Manager from HSS and a General Manager from HMCD.
Manufacturing
HSS will facilitate wafer fab manufacturing through the TSMC or HSS wafer fab
and through HSS assembly or subcontract assembly. HSS will also put in place the
appropriate manufacturing structures to allow MDC to order wafer fab runs,
assemble design verification (DV) units and package testing. Material expenses
in manufacturing such as wafer fab runs, wafer fab masks, package lead frames,
DV packages and production test fixtures shall be
paid for by Xxxxxx MCD. Test development shall be either out-sourced by the MDC
at MDC's expense, or completed using HSS resources if prior agreement is
obtained between HSS and the MDC.
Sales of MDC Designed Products to HMCD
HSS will manufacture, or will facilitate manufacture, of those devices designed
at the MDC for HMCD. HSS agrees to sell these devices to HMCD in accordance with
Corporate guidelines regarding inter-company sales.
Commercialization
HSS may elect to commercialize MDC-developed ICs for the merchant market, or may
elect to make modifications to MDC-developed ICs for the merchant market. In the
event that HMCD requires exclusivity rights for some period of time, or would
not want the ICs made available to the merchant market at all, then such
provisions must be defined in the detailed IC business plan prior to approval.
Public Announcements
Except as may be required by law, neither party shall make any public
announcements or press releases with respect to the terms and relationship of
this agreement with out the consent and concurrence of the other party.
Entire agreement
This agreement constitutes the entire agreement between the parties with respect
to the subject matter and supersedes any previous understandings,
representations, commitments or agreements, oral or written. No provision of
this Agreement may be waived except by a writing signed by the party to be
charged nor may this Agreement be amended except by writing executed by both
parties.
IN WITNESS WHEREOF, the parties have caused this agreement to be duly executed
by the authorized representatives,
Xxxxxx Corporation, Xxxxxx Corporation
Semiconductor Sector Communications Sector
Communications Products Business Microwave Communications Division
By: /s/ Xxx Van Dell By: /s/ Xxxxxxx Xxxxxxx
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Name: Xxx Van Dell Name: Xxxxxxx Xxxxxxx
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Title: Vice President-General Manager Title: UP/GM
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Date: 3/5/99 Date: 3/26/99
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