EXHIBIT 10.10
AMENDMENT 1 TO THE AGREEMENT FOR PURCHASE AND SALE OF CUSTOM
SEMICONDUCTOR PRODUCTS WITH AGREEMENT NO. X0468
THIS AMENDMENT ("Amendment 1") to Agreement Number X0468 entered into
between INTERNATIONAL BUSINESS MACHINES CORPORATION ("IBM") and QUANTUM EFFECT
DESIGN, INC. ("Customer") on or about July 30, 1997 ("the Agreement") is made
and entered into by and between IBM and Customer. This Amendment 1 shall be
effective as of November 15, 1999.
WHEREAS IBM and Customer desire to amend the Agreement so as to modify
the existing terms and conditions of the Agreement and to add additional
products to be manufactured and sold under the terms and conditions of the
Agreement.
NOW THEREFORE, the parties hereby agree to amend the Agreement as
follows:
1. Delete Section 1 in its entirety and replace it with the following:
1.0 TERM OF AGREEMENT. This Agreement is effective on July 30, 1997
(the "Commencement Date"). This Agreement will expire on the later of November
14, 2002 (the "Expiration Date") or upon completion of the last Task Order
entered into prior to the Expiration Date, subject to Section 15 (Termination
Rights).
2. Delete Sections 2 and 3 in their entirety and replace them with the
following:
2.0 FORECASTS AND ORDERS.
2.1 Customer will maintain a rolling twelve (12) month forecast
subject to the following terms and conditions:
2.1.1 For purposes of this Section 2.0, the first month of a
forecast is the month in which the forecast is submitted, the second month of
the forecast is the following month, and so on through the twelfth month. For
example, if a forecast is submitted in January, then January is the first month
and December is the twelfth month. For the next forecast submitted in February,
February moves from the second month to the first month, December becomes the
eleventh month and January of the next year is now the new twelfth month.
Customer's forecast for a specific month indicates the number of Products
Customer forecasts for delivery during that month.
2.1.2 Customer's initial forecast accepted by IBM is set
forth in Section 5 PCL of this Attachment.
2.1.3 By the fifth (5th) day of every month during the term
of this Attachment, Customer will submit a proposed rolling twelve (12) month
forecast in substantially the same format as the initial forecast.
1.
2.1.4 Within ten (10) days of receipt of Customer's proposed
rolling forecast:
(a) IBM will accept the proposed forecast for month
five (5) as submitted, provided that the forecasted amount for month five (5) is
the same as the prior accepted forecasted amount for such calendar month.
(b) IBM may accept or reject a forecast for month six
(6) for any reason. Forecasts for months seven (7) or greater are for
convenience purposes only and are non-binding on Customer and IBM.
(c) If for any month the proposed forecast is greater
than the accepted forecasted amount for the calendar month from the prior
forecast:
(i) IBM may reject such forecast for such month;
(ii) IBM may accept the forecast for such month as
submitted; or
(iii) IBM may negotiate with Customer on a volume
that IBM will accept.
2.1.5 IBM's failure to respond to Customer's proposed
forecast within ten (10) days of receipt of such forecast will result in the
automatic conversion of the proposed forecast into the new accepted forecast.
2.1.6 Customer's failure to submit a forecast by the fifth
(5th) day of any month during the term of this Attachment will result in the
prior month's accepted forecast being deemed as the new accepted forecast. In
this event, months one (1) through eleven (11) will be the same as the prior
accepted forecast amount for each such month and the forecast for month twelve
(12) shall be deemed to be zero (0).
2.1.7 Upon IBM's rejection of a forecast (or any month
thereof), the parties will attempt to negotiate a mutually agreeable forecast.
If the parties fail to mutually agree to a forecast by the last day of the month
in which the forecast was due, then the following forecast will automatically
become the new accepted forecast: months one (1) through five (5) will be the
same as the prior accepted forecasted amount for each such calendar month and
months six (6) through twelve (12) become zero (0).
2.2 Customer will request delivery of Products by issuing written
purchase orders to IBM by the fifth (5th) day of each calendar month. Customer
shall submit a purchase order with its initial forecast for a minimum of the
first four (4) months of the twelve month forecast. With each subsequent
forecast, Customer shall submit a purchase order for the fourth (4th) month of
the forecast (months one (1) through three (3) having already been committed
under purchase order(s) pursuant to the previous forecast).
2.3 Provided Customer is not in breach and meets all other terms
and conditions of this Agreement:
2.
2.3.1 IBM will accept any order whose delivery date is equal
to or greater than four (4) months but less than six (6) months from the order
date provided that the purchase order quantity is between ninety percent (90%)
and one hundred and ten percent (110%) of the most recently accepted forecast
for the month at issue.
2.3.2 IBM may, but is not required to, accept any order
whose delivery date is equal to or greater than six (6) months from the order
date.
2.3.3 IBM may, but is not required to, accept any orders in
which Customer specifies a delivery date less than four months from the order
date, provided that the delivery date is equal to or greater than the Purchase
Order Lead Time and the amount ordered for the month at issue is equal to the
quantity in the most recently accepted forecast for that month.
2.3.4 IBM may, but is not required to, accept orders whose
delivery date is equal to or greater than four (4) months but less than six (6)
months from the order date if such order requests a quantity of Product greater
than one hundred and ten percent (110%) of the most recently accepted forecast
for the month at issue.
2.4 If by the fifth (5th) day of each month during the term of
this Attachment, Customer fails to order at least ninety (90%) of the accepted
forecasted quantity for the month five (5) of the previously accepted forecast
(which is month four (4) of the current forecast), then the cancellation charges
in Section 6.0 PCL of this Attachment will apply.
2.5 IBM may reject any purchase order that does not comply with
the terms and conditions of the Agreement and this Attachment or does not fall
within the most recent Customer credit limit granted by IBM.
2.6 Customer will request delivery of Products by issuing written
purchase orders to the IBM ordering location identified in Section 7.0 PCL of
this Attachment. Purchase orders will specify only the following information:
(a) Customer's purchase order number;
(b) Customer's tax status - exempt or non-exempt;
(c) ship to location - complete address;
(d) xxxx to location - complete address;
(e) order from location - complete address;
(f) shipping instructions, including preferred carrier and
carrier account number;
(g) the agreement number of this Agreement;
(h) name of Customer contact;
(i) Product part numbers, the quantity of wafers being
ordered, (in increments of the Minimum Order Quantity
("MOQ")), and whether Customer wants die packaged from
the wafers ordered;
3.
(j) the Product's applicable unit price; and
(k) requested shipment dates.
3.0 INTENTIONALLY BLANK
3.0 Add the following Task Order #X0468-2 to the Agreement. Task Order
#X0468-2 shall be governed by the terms and conditions of Agreement Number
X0468:
TASK ORDER #X0468-2
1.0 TERM OF TASK ORDER: This Task Order will be effective as of November
15, 1999 and will expire on November 14, 2002, unless earlier terminated
pursuant to Section 15 of the Agreement.
2.0 PRODUCT INFORMATION FOR THE TAHOE PRODUCT:
2.1 PRODUCT DESCRIPTION OF TAHOE:
- Wafer Untested 200mm wafer in CMOS 6SF and
backside grind
- Levels of metal: 4
- number of Transistors: 1745
- die size: 6.2286mm x 6.9243mm
- Wire bond pad pitch: >90 microns
2.2 PRICING FOR TAHOE (Untested 200mm wafer in CMOS 6SF, with 4 levels
of metal, fuse blow and backside grind):
[CONFIDENTIAL TREATMENT]
* The prices for 2001 are for budgetary purposes only.
2.2.1 The pricing set forth above in this Section 2.2 applies to
all orders received by IBM, which are accepted by IBM, during a specific
calendar year. For example, the 1999 price applies to any order received and
accepted by IBM in 1999. Additionally, the pricing applies to all products,
whether Pre-Production or Production, other than Prototypes.
2.2.2 For any product with 5 levels of metal, the pricing shall
be determined by adding [CONFIDENTIAL TREATMENT] to the applicable price under
Section 2.2.
4.
2.3 NRE (NON-RECURRING ENGINEERING CHARGES) FOR TAHOE:
2.3.1 Wafer Fab NRE [CONFIDENTIAL TREATMENT]
- Mask build
- Disclosure of CMOS 6SF design manual
- Disclosure of Spice Models
- Processing of GDS II tape in CMOS 6SF
- 2 prototype wafers
2.3.2 Additional prototype hardware
- Up to 4 wafers [CONFIDENTIAL TREATMENT]
2.3.3 Subsequent metal level revisions
- Per revision [CONFIDENTIAL TREATMENT]
- Per mask level [CONFIDENTIAL TREATMENT]
- Per prototype wafer (up to 6) [CONFIDENTIAL TREATMENT]
The prices in this Section 2.3.3 must be added together to determine
the correct price associated with a specific revision. For example, if Customer
requests that IBM complete one metal revision, which requires three mask level
changes and verification on 4 prototype wafers, then the applicable price would
be:
[CONFIDENTIAL TREATMENT]
2.3.4 IBM shall invoice Customer for NRE due pursuant to Section
2.3.1 as follows: [CONFIDENTIAL TREATMENT] of the NRE upon IBM's acceptance of
Customer's purchase order for the NRE and [CONFIDENTIAL TREATMENT] upon shipment
of Prototypes to Customer. IBM shall invoice Customer for any payment due
pursuant to Section 2.3.2 upon shipment of Prototypes to Customer. IBM shall
invoice Customer for any payment due pursuant to Section 2.3.3 upon IBM's
acceptance of Customer's purchase order for the NRE. ALL PURCHASE ORDERS FOR NRE
ARE NON-CANCELABLE BY CUSTOMER.
2.4 PURCHASE ORDER LEAD TIME FOR TAHOE:
PROTOTYPE* PRODUCTION
---------- ----------
RTAT** [CONFIDENTIAL [CONFIDENTIAL
TREATMENT] TREATMENT]
NTAT [CONFIDENTIAL [CONFIDENTIAL
TREATMENT] TREATMENT]
* The Purchase Order Lead Time for Prototypes runs from
IBM's receipt of Customer's purchase order and its DRC
clean GDS II, provided that IBM has received Customer's
final chip size fourteen (14) days prior to the time
IBM receives the DRC clean GDSII Tape.
** If available, IBM will provide a Turbo RTAT lot.
Otherwise, IBM will provide an NTAT lot.
5.
2.5 DELIVERABLE ITEMS FOR TAHOE:
2.5.1 Customer shall provide IBM with the following:
- DRC clean GDS II Tape
2.5.2 IBM shall provide Customer with the following:
- CMOS 6SF Spice models
- CMOS 6SF Process Ground Rules
3.0 PRODUCT INFORMATION FOR THE OMEGA PRODUCT:
3.1 PRODUCT DESCRIPTION OF OMEGA
- Wafer Untested 200mm wafer in CMOS
6SF and backside grind
- Levels of metal: 4
- number of Transistors: 5635
- die size: 9.9417mm x 9.0138mm
- Wire bond pad pitch: >90 microns
3.2 PRICING FOR OMEGA (Untested 200mm wafer in CMOS 6SF, with
four levels of metal, fuse blow and backside grind):
[CONFIDENTIAL TREATMENT]
* The prices for 2001 are for budgetary purposes only.
3.2.1 The pricing set forth above in this Section 3.2
applies to all orders received by IBM, which are accepted by IBM, during a
specific calendar year. For example, the 1999 price applies to any order
received and accepted by IBM in 1999. Additionally, the pricing applies to all
products, whether Pre-Production or Production, other than Prototypes.
3.2.2 For any product with 5 levels of metal, the pricing
shall be determined by adding [CONFIDENTIAL TREATMENT] to the applicable price
under Section 2.2.
3.3 NRE (NON-RECURRING ENGINEERING CHARGES) FOR OMEGA:
3.3.1 Wafer Fab NRE [CONFIDENTIAL TREATMENT]
- Mask build
- Disclosure of CMOS 6SF design manual
- Disclosure of Spice Models
- Processing of GDS II tape in CMOS 6SF
- 2 prototype wafers
3.3.2 Additional prototype hardware
- Up to 4 wafers [CONFIDENTIAL TREATMENT]
3.3.3 Subsequent metal revisions
6.
- Per revision [CONFIDENTIAL TREATMENT]
- Per mask level [CONFIDENTIAL TREATMENT]
- Per wafer (up to 6) [CONFIDENTIAL TREATMENT]
The prices in this Section 3.3.3 must be added together to determine
the correct price associated with a specific revision. For example, if Customer
requests that IBM complete one metal revision, which requires three mask level
changes and verification on 4 prototype wafers, then the applicable price would
be:
[CONFIDENTIAL TREATMENT]
3.3.4 IBM shall invoice Customer for NRE due pursuant to Section
3.3.1 as follows: [CONFIDENTIAL TREATMENT] of the NRE upon IBM's acceptance of
Customer's purchase order for the NRE and [CONFIDENTIAL TREATMENT] upon shipment
of Prototypes to Customer. IBM shall invoice Customer for any payment due
pursuant to Section 3.3.2 upon shipment of Prototypes to Customer. IBM shall
invoice Customer for any payment due pursuant to Section 3.3.3 upon IBM's
acceptance of Customer's purchase order for the NRE. ALL PURCHASE ORDERS FOR NRE
ARE NON-CANCELABLE.
3.4 PURCHASE ORDER LEAD TIME FOR OMEGA:
PROTOTYPE* PRODUCTION
------------- -------------
RTAT** [CONFIDENTIAL [CONFIDENTIAL
TREATMENT] TREATMENT]
NTAT [CONFIDENTIAL [CONFIDENTIAL
TREATMENT] TREATMENT]
* The Purchase Order Lead Time for Prototypes runs from
IBM's receipt of Customer's purchase order and its DRC
clean GDS II, provided that IBM has received Customer's
final chip size fourteen (14) days prior to time IBM's
receipt of Customer's DRC clean GDSII Tape.
** If available, IBM will provide a Turbo RTAT lot.
Otherwise, IBM will provide an NTAT lot.
3.5 DELIVERABLE ITEMS FOR OMEGA:
3.5.1 Customer shall provide IBM with the following:
- DRC clean GDS II Tape
3.5.2 IBM shall provide Customer with the following:
- CMOS 6SF Spice models
- CMOS 6SF Process Ground Rules
7.
4.0 NRE FOR RECENTERING I-SUM FOR TAHOE AND OMEGA
4.1 The following provisions in this Section 4.0 describe terms
and conditions applicable to IBM's efforts, at Customer's request, to tailor the
poly line width of Tahoe and/or Omega Products.
4.2 Customer may request recentering I-sum NRE services in
purchase orders issued to IBM. In such case, Customer shall designate the I-sum
value in its purchase order. The payments for such NRE services will be
determined by reference to the table below and are based on the number of lots
of wafers (for which Customer is seeking recentering) purchased by Customer
under the purchase order at issue. There are 24 wafers in a lot.
>1050 I-sum < 1050 I-sum
Lots per purchase order NRE Charge NRE Charge
----------------------- ------------------------ ------------------------
For lots 1-10 [CONFIDENTIAL TREATMENT] [CONFIDENTIAL TREATMENT]
For lots 11-20 [CONFIDENTIAL TREATMENT] [CONFIDENTIAL TREATMENT]
For lots 21-30 [CONFIDENTIAL TREATMENT] [CONFIDENTIAL TREATMENT]
For lots 31-40 [CONFIDENTIAL TREATMENT] [CONFIDENTIAL TREATMENT]
For lots 41 or more [CONFIDENTIAL TREATMENT] [CONFIDENTIAL TREATMENT]
4.3 For example, the NRE recentering charge for a purchase order
requesting 25 lots with an I-sum of 1025 would be determined as follows:
[CONFIDENTIAL TREATMENT]
4.4 Purchase orders to recentering the I-sum values must be
accompanied by a change order, to assist IBM in having a specific part number
associated with the recentered product.
4.5 The I-sum recentering charges do not include charges for new
masks or other engineering services. Should additional masks or services be
required, IBM will provide a quotation based on the customer requirements.
4.6 ALL NRE SERVICES ASSOCIATED WITH RECENTERING I-SUM VALUES ARE
PROVIDED ON AN "AS IS" BASIS. IBM DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS OR USE FOR A
PARTICULAR PURPOSE.
4.7 ALL ORDERS FOR RECENTERED I-SUM PRODUCTS ARE NON-CANCELABLE.
CUSTOMER MUST PAY FOR ALL SUCH PRODUCTS, REGARDLESS OF YIELD RESULTS OR THE
CONDITION, RELIABILITY OR QUALITY OF THE PRODUCTS OR ANY VARIABILITY FROM WAFER
TO WAFER OR LOT TO LOT. ALL SUCH PRODUCTS ARE PROVIDED ON AN "AS IS" BASIS. IBM
DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES
OF MERCHANTABILITY AND FITNESS OR USE FOR A PARTICULAR PURPOSE.
8.
5.0 PRODUCT DEMAND FORECASTS FOR BOTH TAHOE AND OMEGA:
5.1 Wafers
Tahoe [CONFIDENTIAL TREATMENT]
Omega
5.2 Minimum order quantity for both Tahoe and Omega is 1 lot of
24 wafers.
6.0 CANCELLATION CHARGES AND RESCHEDULING
The following sets forth Customer's rescheduling rights and the
cancellation charges that will be apply for failure to order against accepted
forecasts and to any change or canceled Customer order or portion thereof. The
"cancellation charge" referred to below is the percentage to be applied to the
prices stated in Sections 2.2 and 3.2 hereof. As noted in other sections of this
Task Order, purchase orders nor NRE services, including NRE Recentering I-Sum
services, are non-cancelable and nothing in this Section 5 modifies that fact.
6.1 RESCHEDULING
6.1.1 Customer may reschedule a shipment date provided:
(a) customer sends IBM written notice of the request
to reschedule;
(b) the notice is received by IBM more than
[CONFIDENTIAL TREATMENT] days prior to the
shipment date; and
(c) the rescheduled delivery date is written
[CONFIDENTIAL TREATMENT] days after the current
shipment date. If the foregoing requirements are
met, no cancellation charge will be imposed by
IBM in connection with rescheduling. Once a
shipment date is rescheduled, the new shipment
date is firm and cannot be rescheduled by
Customer.
6.1.2 If customer cancels an order or reduces an order or
exceeds the foregoing Product shipment rescheduling rights in this Section,
Customer agrees to pay the Product cancellation charges as described below.
The charges below also apply for any Product scrapped at Customer's request
or as a result of yield deficiencies caused in whole or in part by Customer's
design and for Product deemed cancelled due to Customer exceeding the
rescheduling rights set forth above. These charges apply with respect to both
Pre-production and Production products.
9.
6.2 CANCELED OR CHANGED ORDERS
Wafers
-------------------------------------------------- ------------------------------------------------
Notice of purchase order cancellation or change Wafer Cancellation Charge
received by IBM: (Percentage to be applied to the prices set
forth in Section 2.2 or 3.2 above, as
applicable)
-------------------------------------------------- ------------------------------------------------
After Wafer Start [CONFIDENTIAL TREATMENT]
-------------------------------------------------- ------------------------------------------------
After purchase order acknowledgement and prior [CONFIDENTIAL TREATMENT]
to wafer start
-------------------------------------------------- ------------------------------------------------
6.3 CANCELLED OR CHANGED FORECASTS
If customer fails to order forecasted quantities of
Product for month five (5) of any accepted forecast, as described in Section
2.2 and 2.4 of the Agreement, Customer will pay [CONFIDENTIAL TREATMENT] of
the wafer price and/or [CONFIDENTIAL TREATMENT] of the module packaging price
for all Product that was not ordered; however, there shall be no charge for a
given month if Customer orders at least [CONFIDENTIAL TREATMENT] of the
forecasted quantities listed in the most recently accepted forecast, for that
month.
7.0 TASK ORDER TECHNICAL COORDINATORS:
IBM Microelectronics Quantum Effect Design, Inc.
Director of Manufacturing
000 Xxxxx Xxxxxx 0000-0 Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxx Xxxxxxxx, XX 00000 Xxxxx Xxxxx, Xxxxxxxxxx 00000
Fax: 000-000-0000 Fax: 000-000-0000
Attn: Xxxx Xxxxxxxx Attn: Xxxx Xxxxxxxx
8.0 SHIPPING/BILLING/ORDERING LOCATIONS:
Customer's Ship to Location: Customer's Xxxx to Location:
Per purchase orders Per purchase orders
IBM's Ordering Location:
International Business Machines Corporation
0000 Xxxxxxx Xx.
Xxxxxxxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx
Fax: 000-000-0000
10.
NO OTHER AMENDMENT OR MODIFICATION. Except as expressly set forth in
this Amendment 1, the Agreement remains in full force and effect without
modification. The terms and conditions of this Amendment 1 and the Agreement
shall not be modified or amended except by a writing signed by authorized
representatives of both parties.
ENTIRE AGREEMENT. The Agreement, as amended herein sets forth the
entire agreement and understanding between the parties, and supersedes and
cancels all previous negotiations, agreements, commitments and writings, in
respect to the subject matter hereof, and neither party hereto shall be bound by
any term, clause, provision or condition except as expressly provided in the
Agreement as amended herein or as duly set forth on or subsequent to the date
hereof in writing, signed by duly authorized representatives of the parties.
AGREED TO AND ACCEPTED BY:
INTERNATIONAL BUSINESS MACHINES QUANTUM EFFECT DESIGN, INC.
CORPORATION
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx Xxxxxxxx
------------------------------- ------------------------------
Authorized Signature Authorized Signature
Name: Xxxxx X. Xxxxxx Name: Xxxxxx Xxxxxxxx
Title: VP NA Sales, IBM MD Title: Director of Manufacturing
Date: Date: 12/16/99
11.
