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CONFIDENTIAL TREATMENT REQUESTED
Exhibit 10.13
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*Portions denoted with an asterisk have
been omitted and filed separately with
the Securities and Exchange Commission
pursuant to a request for confidential
treatment.
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FOUNDRY AGREEMENT
THIS FOUNDRY AGREEMENT (the "Agreement") is made as of April 8, 1999. (the
"Effective Date") by and between Xicor Inc., a California corporation, having
its principal place of business at 0000 Xxxxxxx Xx., Xxxxxxxx, XX 00000
("Xicor") and Zentrum Mikroelektronik Dresden GmbH, a corporation organized
under the laws of Germany, having its principal place of business at XxxxxxxxxXx
00, 00000 Xxxxxxx, Xxxxxxx ("ZMD"), with reference to the following facts:
A. Xicor desires to have certain products of its design manufactured by
ZMD for sale to Xicor.
B. ZMD has the capability of manufacturing such products and desires to
do so for sale to Xicor.
C. Such products will be manufactured in a facility owned by ZMD and
located at its principal place of business.
D. Xicor may also in the future desire to transfer further production to
the ZMD facility.
NOW, THEREFORE, in consideration of the foregoing and the covenants contained
below, the parties agree as follows:
1. DEFINITIONS:
1.1 "Products" shall mean fully processed silicon wafers containing
finished die of Xicor's integrated circuit products.
1.2 "Update" shall mean changes to a Product that result in a new
version of the Product with improved performance, reduced size and/or
minor changes in functionality over previous versions of the Product.
1.3 "Production" shall mean the manufacturing of Products using a
qualified Process. Milestones for Production operations are set forth in
Exhibit 1.3 attached hereto and made a part hereof.
1.4"Process" shall mean the wafer manufacturing process used for
manufacturing of the Products.
2. MANUFACTURING:
2.1 Initial Focus: The initial Production focus shall be Xicor's DCP
product lines and processes, specifically the C5.64 and C5.67 Processes.
2.2 Foundry: ZMD owns a wafer fabrication facility (the "ZMD Fab")
located at its principal place of business in Dresden, Germany that will
be suitable for the purposes of this Agreement.
2.3 Qualification of ZMD Fab: Qualification of the ZMD Fab will occur
upon completion of the quality & reliability requirements set forth in
Exhibit 6.1
2.4 Manufacturing: Upon Xicor's orders therefor and subject to
qualification pursuant to section 6 below, ZMD agrees to manufacture and
sell Products, and Xicor agrees to purchase such Products from ZMD, on
the terms and conditions set forth herein. The parties agree that the
first Products to be manufactured hereunder shall be Xicor's DCP
products on Xicor's C5.64 and C5.67 Processes with such additional
Products or Processes as may from time to time be agreed to by the
parties. If other Products or Processes are added, the appropriate
Exhibits specific to the additional Products and Processes must be
included. ZMD agrees to provide Xicor with appropriate documentation of
the manufacturing Processes , which will include wafer and lot
identification and traceability.
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2.5 Deliverables by Xicor: With respect to each Product that Xicor
requires ZMD to manufacture hereunder, Xicor shall provide all necessary
technical information. Such information is set forth in Exhibit 2.5
attached hereto and made a part hereof.
2.6 Mask Sets: Xicor shall provide to ZMD at Xicor's expense, all masks
and GDS-II data required to enable ZMD to manufacture the Products
hereunder. Xicor shall provide all information necessary for using
Xicor's masks for manufacturing at ZMD. ZMD shall provide Xicor with the
final sizing tables for approval by Xicor. If under any circumstances a
mask or mask set is lost or broken by ZMD, ZMD shall pay for the
replacement mask or mask set. Additional mask sets required by ZMD for
manufacturing purposes shall be at ZMD's expense.
3. PRICE AND PAYMENT TERMS:
3.1 Price: Xicor shall purchase the Products manufactured under this
Agreement at the prices and on the payment terms set forth in Exhibit
3.1 attached hereto and made a part hereof. Payment terms, shipping
terms and obligation for taxes will be agreed to in Exhibit 3.1.
3.2 Yield: The parties agree that ZMD's initial target yield for each
Product ("Initial Target Yield") shall be as set forth in Exhibit 3.2
attached hereto and made a part hereof. The Initial Target Yields will
increase in accordance with Exhibit 3.2, subject to renegotiations as
provided in Exhibit 3.2.
4. WAFER PROBE: ZMD shall perform wafer probe which shall be 100% electrical
test at wafer sort as soon as practicable. The applicable data sheet and test
requirements are set forth in Exhibit 4 attached hereto and made a part hereof.
Prices for wafer probe shall be listed in Exhibit 3.1.
5. FORECAST AND ORDERS:
5.1 Six Month Rolling Forecast: During the term of this Agreement, Xicor
shall provide to ZMD a 24 weeks rolling forecast setting forth its
estimated requirements for wafer starts by week for Products. ZMD will
review the forecast and will respond within one week. ZMD agrees to use
its reasonable best efforts to meet all commitments for the period of
the forecast unless otherwise agreed to by both ZMD and Xicor. The first
12 weeks of the forecast will be "firm" for 125 mm wafer starts. ZMD
agrees that in exceptional cases, it will negotiate Xicor requested
push-outs and cancellations of the firm backlog with Xicor.
5.2 Orders: A "blanket" purchase order shall be initiated by Xicor and
maintained on an ongoing basis. All releases issued by Xicor against the
blanket purchase order shall state unit quantities, unit descriptions,
unit prices, requested delivery dates, and shipping instructions.
Provided that the release is consistent with the forecast provided to
ZMD under section 5.1 hereof, the cycle times under section 5.3(c)
hereof, and the other terms and conditions hereof, ZMD shall accept the
order. ZMD shall acknowledge on Monday morning (Germany time) of each
week its acceptance of the "queued" loaded schedule.
5.3 Lots: Xicor shall order Products as specified below:
(a) Engineering Lots: Xicor may order engineering lots where
Xicor seeks the qualification of an Update or a Product not
previously manufactured by ZMD, to seek or otherwise improve
functionality and yield, or to make any other engineering
changes. For purposes of this Agreement, an engineering lot shall
contain at least six wafers. It shall be Xicor's responsibility
to inform and provide ZMD with the specifications for the
engineering changes to be made to an engineering lot before
manufacturing begins. Specifications shall be attached to, or
referenced by Xicor's purchase order. Any change to the
specifications shall
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be documented by Xicor to ZMD. The price for engineering lots are
described in Exhibit 3.1. II.
(b) Production Lots: Xicor shall order a Product by lot quantity.
The normal wafer lot shall contain 25 wafers.
(c) Production Cycle Times: The target cycle time for ZMD for
each Product manufactured hereunder shall be as per Exhibit 5.3.
5.4 Process Termination: Xicor shall provide ZMD with at least twelve
(12) months notice - but not sooner than Dec. 31st, 2000 -of the date on
which Xicor will no longer schedule wafer starts on an existing process
used to manufacture Products.
5.5 Delays: Subject to section 13.12, Xicor shall have the right to
cancel any order, in whole or in part, when delivery is not made within
four (4) weeks of the agreed date. Cancellation will be Xicor's sole
remedy in this case. In the case of late delivery of certain high volume
Products, the parties may mutually agree to extend said delivery date
for an additional 4 weeks.
6. QUALIFICATION AND QUALITY CONTROL:
6.1 Qualification: Products to be manufactured and the manufacturing
processes to be used under this Agreement are subject to qualification
by Xicor and ZMD pursuant to qualification criteria and procedures set
forth in Exhibit 6.1 attached hereto and made a part hereof
("Qualification"). The parties agree to use their best efforts to
complete any Qualification required in this section 6.1 and under
section 6.2 hereof as soon as possible. ZMD may not ship production
wafers to Xicor until ZMD has a Quality Plan approved by the Xicor
Quality Organization and has been formally audited by Xicor unless
specifically authorized to do so by Xicor.
6.2 Changes:
(a) ZMD Process Changes: After Qualification of a Product, ZMD
may not make any process change without prior written consent
from Xicor. Any such change must be in accordance with Exhibit
6.2 attached hereto and made a part hereof and will be subject to
qualification according to the applicable criteria and procedures
set forth in Exhibit 6.1.
(b) Xicor Process Changes: If Xicor desires ZMD to make a process
change, Xicor shall notify ZMD in writing thereof. ZMD will not
implement or act on any verbal change instructions. Upon receipt
of such written instructions, ZMD will review the proposed change
and provide to Xicor a written evaluation stating the cost and
schedule to implement the same. The parties will then mutually
agree on the terms and conditions of the implementation of such
change. All changes agreed to by ZMD and Xicor shall be reflected
in an update to the ZMD documentation of the baseline
manufacturing process.
6.3 Rework: ZMD may perform rework on wafers only to the extent that it
has been authorized and approved by Xicor as set forth in Exhibit 6.3
attached hereto and made a part hereof.
6.4 Life Test and Reliability Monitors: Xicor may, at its option, from
time to time, utilize life test and other agreed upon reliability
monitors with respect to the Products manufactured by ZMD hereunder.
These monitors, as per Exhibit 6.4 attached hereto and made a part
hereof, will be established as soon as practicable. Commencing ninety
(90) days after ZMD has begun manufacturing production lots of each
Product, if these tests indicate that ZMD's manufacturing facility is
not being maintained within required manufacturing parameters, the
parties agree to confer with respect thereto, and ZMD agrees to take all
reasonable measures to promptly correct any such problems.
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6.5 Manufacturing and Quality Audits: Xicor may, at its option, but no
more often than two times in any calendar year, conduct a manufacturing
and quality audit of the ZMD Fab. These audits will be conducted during
normal business hours. Xicor agrees to provide ZMD reasonable prior
notice of its intention to conduct such audit. ZMD agrees to cooperate
fully with Xicor during the audit, to give Xicor auditing personnel
access to the ZMD Fab, and to provide whatever documents and other
information regarding the operation of the ZMD Fab in connection with
this Agreement that they may reasonably request. ZMD shall not allow
Xicor and its auditing personnel access to ZMD's other customers' data.
Disclosure of Confidential Information (as hereinafter defined) of ZMD
shall be subject to section 11.1 hereof. Each party shall pay its own
expenses actually incurred due to any such audits.
6.6 Manufacturing Control Plan: ZMD shall develop and maintain a
manufacturing control plan to identify the critical processes and
implement SPC (Statistical Process Control) to monitor and control such
critical processes. The critical processes will include, but not be
limited to, facilities, environment, DI water and chemical purity, which
ZMD shall monitor constantly to ensure consistent Product quality and
reliability. These critical processes are set forth in Exhibit 6.6
attached hereto and made a part hereof. ZMD shall provide monthly
SPC/Cpk data for all critical processes as applicable. For all Cpks less
than 1.67, ZMD shall provide an action plan to achieve at least 1.67 as
soon as practicable, but the eventual Cpk goal for ZMD shall be 2.0. For
manufacturing processes with Cpk less than 1.0, ZMD shall develop a
"containment" plan. ZMD will also install and maintain appropriate Y2k
compliant systems to enable it to provide Xicor with WIP status for all
lots at all times.
6.7 ISO 9000 Requirements: Quality systems defined by ISO 9000 shall be
used as a part of manufacturing the Products hereunder. If any Xicor
customers so require, QS-9000 certification shall also be required. In
both cases, certification from an approved registrar shall be required.
7. OTHER TERMS AND CONDITIONS.
7.1 Controlling Document: The terms and conditions of this Agreement
shall control all sales of Products hereunder, and any additional or
different terms of conditions in either party's purchase order,
acknowledgment, or similar document shall be of no effect.
7.2 Delivery and Lead Time: ZMD shall deliver Products on the delivery
dates specified in the purchase order releases placed in accordance with
section 5. The shipping window will be -5 to +5 days.
7.3 Shipping Documentation: All Products delivered pursuant to the terms
of this Agreement shall be suitably packaged, marked and otherwise
prepared in accordance with normal commercial practice while maintaining
the safety of the Products. The Products shall be shipped as specified
in Xicor's purchase order, and delivered to Xicor. Shipping and packing
documents from ZMD shall include the Xicor Purchase Order and release
number under which the contracted services shall be performed. Shipping
documents shall include the following: 1) Product(s) being ordered,
including Xicor Part Number; 2) Manufacturing Lot Number; 3) Quantity of
Products; 4) Delivery Instructions, including designated carrier, if
any; 5) Quantity of good die per wafer; and 6) yield, process, and/or
parametric information as may be required under the terms of this
Agreement, the exhibits hereto or the applicable purchase order.
Shipping documents are set forth in Exhibit 7.3 attached hereto and made
a part hereof.
7.4 Inspection and Acceptance: Product lots delivered by ZMD shall meet
the quality requirements of Xicor and may be inspected and tested for
verification. Quality requirements are defined in Exhibit 7.4 attached
hereto and made a part hereof. Wafers and lots will be identifiable and
traceable under the documentation provided under section 2.4 hereof. In
the event any lot or wafer fails to meet the quality requirements of
said Exhibit 7.4, Xicor shall have the right to reject such lot or wafer
within thirty (30) days after invoice date and returns it to ZMD for
replacement, provided that replacement is commercially reasonable.
Replacement will be Xicor's exclusive remedy in this case. If
replacement
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is not commercially reasonable, Xicor may cancel that portion of the
relevant purchase order relating to the defective wafers.
7.5 Warranty:
(a) ZMD warrants to Xicor that from the date of delivery and for
a period of 12 months thereafter, each Product will
satisfactorily pass the acceptance criteria identified in Exhibit
7.4 attached hereto and shall be free from defects in material
and workmanship under normal use and service. This warranty does
not cover any failure resulting from (i) assembly not performed
by ZMD, or (ii) misuse, abuse, abnormal conditions or shipment
damage. This warranty is personal to Xicor and not transferable.
(b) THE WARRANTY CONTAINED IN SECTION 7.5(a) IS THE ONLY WARRANTY
GIVEN BY ZMD AND ZMD EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES,
WHETHER EXPRESS, IMPLIED, OR STATUTORY, INCLUDING, WITHOUT
LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND OF
FITNESS FOR A PARTICULAR PURPOSE, ANY WARRANTY OF
NON-INFRINGEMENT, AND ANY WARRANTY THAT MAY ARISE BY REASON OF
USAGE OF TRADE, CUSTOM OR COURSE OF DEALING, AND XICOR HEREBY
EXPRESSLY WAIVES ANY AND ALL SUCH WARRANTIES.
(c) Xicor's exclusive remedy, and ZMD's exclusive obligation and
liability, with respect to any Product that does not conform to
the express warranty set forth in Section 7.5(a) hereof, shall be
to perform failure analysis and to replace (or repair if
applicable) such Product, without charge, and deliver it to
Xicor; provided, however, that in each such case, repair or
replacement is commercially reasonable. If such remedy is not
commercially reasonable, ZMD shall refund to Xicor the amount
paid for such Product. Upon discovering such defect, Xicor shall
promptly return the affected Products to ZMD, adequately
packaged, within the warranty period at Xicor's expense with a
detailed statement of the defect. Xicor shall obtain a return
material authorization (RMA) number and show it on the packaging.
Any replacement Product shall also be warranted for a period of
12 months from delivery. If ZMD's examination of the Products
returned by Xicor does not disclose any warranty defect, Xicor
agrees to pay ZMD's applicable charges for unpacking, testing and
re-packing the Products for reshipment to Xicor. If ZMD's testing
does disclose a warranty defect, ZMD will reimburse the return
shipping charges paid by Xicor for such Products.
8. LIMITATION OF LIABILITY.
8.1 Under no circumstances shall ZMD be liable for the costs of
procurement of substitute goods or services or for any special,
indirect, incidental or consequential damages of any kind or nature
whatsoever, arising out of or in any way related to this Agreement, the
Products or the use or inability to use any Products, including, without
limitation, lost goodwill, lost profits, work stoppage or impairment of
other goods, and whether arising out of breach of warranty, breach of
contract, tort (including negligence), strict liability or otherwise,
even if advised of the possibility of such damage or if such damage
could have been reasonably foreseen, and notwithstanding any failure of
essential purpose of any exclusive remedy provided herein.
8.2 In no event shall ZMD's total liability relating to or in connection
with any Products or this Agreement, whether based on contract,
warranty, tort (including negligence), strict liability or otherwise,
exceed the actual amount paid to ZMD by Xicor hereunder.
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9. INDEMNITY.
9.1 ZMD shall not be held responsible and Xicor shall defend, indemnify
and hold harmless ZMD and its United States subsidiary from and against
any and all claims, demands, liabilities, damages, costs and expenses,
including, without limitation, reasonable attorneys' fees and other
legal and expert expenses, arising out of or relating to any actual or
alleged infringement upon any patent right, copyrights or mask work
right of any third party by any Product manufactured by ZMD for Xicor
hereunder or by any process, material or technology provided to ZMD by
Xicor hereunder for the manufacture of the Products. ZMD will give to
Xicor written notice of any claim for which Xicor is providing
indemnification hereunder. Xicor will have (i) the right to assume, in a
prompt fashion, sole control of the defense or settlement of such claim
(provided that Xicor cannot commit ZMD to the payment of any sums in
settlement or otherwise), and (ii) the right to receive reasonable
assistance from ZMD, at Xicor's request and expense. ZMD may, at its
expense, participate in such defense with counsel of its own choice.
9.2 Xicor shall not be held responsible and ZMD shall defend, indemnify
and hold harmless Xicor from and against any and all claims, demands,
liabilities, damages, costs and expenses, including, without limitation,
reasonable attorneys' fees and other legal and expert expenses, arising
out of or relating to any actual or alleged infringement upon any patent
right, copyrights or mask work right of any third party by any process,
material or technology used by ZMD in the performance of its obligations
hereunder other than any process, material or technology provided to ZMD
by Xicor hereunder for the manufacture of the Products. Xicor will give
to ZMD written notice of any claim for which ZMD is providing
indemnification hereunder. ZMD will have (i) the right to assume, in a
prompt fashion, sole control of the defense or settlement of such claim
(provided that ZMD cannot commit Xicor to the payment of any sums in
settlement or otherwise), and (ii) the right to receive reasonable
assistance from Xicor, at ZMD's request and expense. Xicor may, at its
expense, participate in such defense with counsel of its own choice.
9.3 THE FOREGOING STATES THE ENTIRE LIABILITY OF EITHER PARTY AND ITS
AFFILIATES, AND THE SOLE AND EXCLUSIVE REMEDY OF THE OTHER PARTY AND ITS
AFFILIATES, WITH RESPECT TO INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS
BY ANY PRODUCTS OR PROCESSES OF SUCH PARTY.
10. TECHNOLOGY OWNERSHIP AND NON-COMPETITION: Xicor shall retain ownership of
all designs, process technology and other information and materials provided to
ZMD for purposes of manufacturing Products. Xicor authorizes ZMD to use such
proprietary information supplied by Xicor under this Agreement only for the
purpose of manufacturing Products for sale to Xicor in accordance with the terms
of this Agreement. ZMD agrees that ZMD will not directly compete with Xicor with
products or semiconductor devices similar in nature and competitive to those
Xicor Products listed in Exhibit 10.0 during the term of this agreement and one
year after termination of the agreement (see Exhibit 10 for additional details).
11. CONFIDENTIALITY.
11.1 Confidential Information:
(a) As used in this section 11.1, the term "Confidential
Information" shall mean any information disclosed by one party to
the other pursuant to this Agreement which is in written,
graphic, machine-readable or other tangible form and is marked
"Confidential," "Proprietary" or in some other manner to indicate
its confidential nature. Confidential Information may also
include oral information disclosed by one party to the other
pursuant to this Agreement, provided that such information is
designated as confidential at the time of disclosure and reduced
to a written summary by the disclosing party within thirty (30)
days after its oral disclosure, which is marked in a manner to
indicate its confidential nature and delivered to the receiving
party. Notwithstanding any failure to so identify it, however,
all (i) technical materials, process technology and other
information provided by Xicor to ZMD to enable or assist ZMD in
manufacturing Products and (ii) ZMD processes that a Xicor
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employee may observe as part of an audit or similar procedure,
shall be deemed "Confidential Information" hereunder.
(b) Each party shall treat as confidential all Confidential
Information of the other party, shall not use such Confidential
Information except as expressly set forth herein or otherwise
authorized in writing, shall implement reasonable procedures to
prohibit the disclosure, unauthorized duplication, misuse, or
removal of the other party's Confidential Information and shall
not disclose such Confidential Information to any third party
except as obligations of such party under this Agreement, and
subject to confidentiality obligations at least as protective as
those set forth herein. Without limiting the foregoing, each of
the parties shall use at least the same procedures and degree of
care which it uses to prevent the disclosure of its own
confidential information of like importance to prevent the
disclosure of Confidential Information disclosed to it by the
other party under this Agreement, but in no event less than
reasonable care.
(c) Notwithstanding the above, neither party shall have liability
to the other with regard to any Confidential Information of the
other which:
(i) was generally known and available in the public domain
at the time it was disclosed or becomes generally known
and available in the public domain through no fault of the
receiver;
(ii) was known to the receiver at the time of disclosure
as shown by the files of the receiver in existence at the
time of disclosure;
(iii) is disclosed with the prior written approval of the
discloser;
(iv) was independently developed by the receiver without
any use of the Confidential Information and by employees
or other agents of the receiver who have not been exposed
to the Confidential Information, provided that the
receiver can demonstrate such independent development by
documented evidence prepared contemporaneously with such
independent development;
(v) becomes known to the receiver from a source other than
the discloser without breach of this Agreement by the
receiver and otherwise not in violation of the discloser's
rights; or
(vi) is disclosed pursuant to the order or requirement of
a court, administrative agency, or other governmental
body, provided that the receiver shall provide prompt,
advance notice thereof to enable the discloser to seek a
protective order or otherwise prevent such disclosure.
(d) "Residual Information" means information in non-tangible form
that is or may be retained by persons who have had access to the
Confidential Information of a party, including ideas, concepts,
know-how or techniques contained therein. However, Residual
Information shall not include (i) information which the employee
knows, constitutes the Confidential Information of the other
party hereunder, or (ii) information that is purposefully
committed to memory by the employee for purposes of
misappropriation. The parties acknowledge and agree that they and
their respective employees may utilize for any purpose any
Residual Information resulting from using or having access to
Confidential Information. However, the non-disclosure obligations
of this section 11 shall continue to apply to such Residual
Information.
(e) Each party shall obtain the execution of proprietary
non-disclosure agreements with its employees, agents and
consultants having access to Confidential Information of the
other
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party, and shall diligently enforce such agreements, or shall be
responsible for the actions of such employees, agents and
consultants in this respect.
(f) If either party breaches any of its obligations with respect
to confidentiality and unauthorized use of Confidential
Information hereunder, the other party shall be entitled to
equitable relief to protect its interest therein, including but
not limited to injunctive relief, as well as money damages.
11.2 Publicity: All publicity regarding the announcement of this
Agreement shall be coordinated by both parties. Neither party shall
disclose the terms of this Agreement without the prior written approval
of the other party, except as required as a matter of law.
12. TERM AND TERMINATION.
12.1 Term: This Agreement shall begin on the date noted above and shall
remain in effect for five years from such date, unless otherwise
terminated earlier as provided below. This Agreement may be extended for
successive periods of two years beyond such time by the written consent
of both parties.
12.2 Termination for Breach: If either party breaches any material term
of condition of this Agreement and fails to cure that breach within
thirty (30) days, or fails to cure such breach within a reasonable
period of time if such breach can not reasonable be cured within the
said thirty (30) day period, after receiving written notice of the
breach, the other party shall have the right to terminate this
Agreement, on written notice, at any time after the end of such thirty
(30) day period or after such reasonable period if such breach could not
reasonable be cured within the said thirty (30) day period.
12.3 Termination for Insolvency: If either party becomes the subject of
a voluntary or involuntary petition in bankruptcy or of any proceeding
relating to insolvency, receivership, liquidation, or composition for
the benefit of creditors, if that petition or proceeding is not
dismissed with prejudice within sixty (60) days after filing, the other
party may terminate this Agreement on thirty (30) days' notice.
12.4 Return of Materials: Upon termination or expiration of this
Agreement, ZMD shall return to Xicor all information, process technology
and other items supplied to it under this Agreement.
12.5 Survival of Provisions: The rights and obligations of the parties
pursuant to sections 3.1, 5.5, 7.2, 7.3, 7.4, 7.5, 8, 9, 10, 11, 12.6
and 13.2 shall survive the termination of this Agreement (as well as
other provisions of this Agreement to the extent contemplated by section
12.6 hereof).
12.6 Effects of Termination: Except as and for the time period provided
herein, upon the effective date of termination, ZMD shall cease
manufacturing the Products. Xicor shall purchase, pay for and take
delivery of Products in accordance paragraph 5.1. In addition, unless
the parties agree otherwise (including agreement on appropriate payment
to ZMD), Xicor shall take delivery of and pay, pursuant to the terms of
this Agreement, for all Products affected by such termination, which at
the time of the receipt of the applicable notice of termination are
subject to purchase orders of Xicor that have been accepted by ZMD. Such
addition delivery and payment includes the "die bank" and all in-process
inventory in accordance with section 5.4 hereof and ZMD will either
manufacture, complete and deliver such Products to Xicor in accordance
with the provisions hereof, which may be after the effective date of
termination, or, if requested by Xicor, Xicor may elect to compensate
ZMD based on the percentage of mask layers completed.
13. MISCELLANEOUS.
13.1 Governing Law: This Agreement shall be governed by and interpreted
in accordance with the laws of the State of California without reference
to conflict of laws principles.
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13.2 Arbitration: Any dispute or claim arising out of or in connection
with this Agreement shall be finally settled by binding arbitration in
the English language. If Xicor institutes the proceedings, they shall be
held in Dresden, Germany under the rules of arbitration of the
International Chamber of Commerce by one arbitrator appointed in
accordance with said rules. If ZMD institutes the proceedings, they
shall be held in San Francisco, California under the rules of
arbitration of the American Arbitration Association by one arbitrator
appointed in accordance with said rules. Judgment on the award rendered
by the arbitrator may be entered in any court having jurisdiction
thereof. Notwithstanding the foregoing, (i) the parties may apply to any
court of competent jurisdiction for injunctive relief without breach of
this arbitration provision, and (ii) collection matters shall
specifically be excluded from this arbitration provision.
13.3 Assignment: Neither party may assign or delegate this Agreement or
any of its licenses, rights or duties under this Agreement without the
prior written consent of the other, except either party may assign this
Agreement to a person or entity into which it has merged or which has
otherwise succeeded to all or substantially all of its business and
assets, and which has assumed in writing or by operation of law its
obligations under this Agreement.
13.4 Authority: Each party represents that all corporate action
necessary for the authorization, execution and delivery of this
Agreement by such party and the performance of its obligations hereunder
has been taken.
13.5 Export Controls: The parties agree that no technical information
disclosed by one party to the other party under this Agreement or any
direct product of such technical information is intended to or will be
exported or re-exported, directly or indirectly, to any destination
restricted or prohibited by applicable law without necessary
authorization by the appropriate government authorities.
13.6 Notices: All notices and other communications required or permitted
hereunder shall be in writing and shall be mailed or otherwise delivered
by hand, by messenger or by telecommunication, addressed to the
addresses first set forth above or at such other address furnished with
a notice in the manner set forth herein. Such notices shall be deemed to
have been served when delivered or, if delivery is not accomplished by
reason of some fault of the addressee, when tendered.
13.7 Partial Invalidity: If any paragraph, provision, or clause thereof
in this Agreement shall be found or be held to be invalid or
unenforceable in any jurisdiction in which this Agreement is being
performed, the remainder of this Agreement shall be valid and
enforceable and the parties shall negotiate, in good faith a substitute,
valid and enforceable provision which most nearly effects the parties'
intent in entering into this Agreement.
13.8 Counterparts: This Agreement may by executed in two (2) or more
counterparts, all of which, taken together, shall be regarded as one and
the same instrument.
13.9 Waiver: The failure of either party to enforce at any time the
provisions of this Agreement shall in no way be constituted to be a
present or future waiver of such provisions, nor in any way affect the
validity of either party to enforce each and every such provision
thereafter.
13.10 Entire Agreement: The terms and conditions herein contained
constitute the entire agreement between the parties and supersede all
previous agreements and understandings, whether oral or written, between
the parties hereto with respect to the subject matter hereof and no
agreement or understanding varying or extending the same shall be
binding upon either party hereto unless in a written document signed by
the party to be bound thereby.
13.11 Section Headings: The section headings contained in this Agreement
are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
13.12 Force Majeure: Neither party shall be liable or responsible for
any defaults or delays in performance due to strikes, riots, acts of
God, shortages of lab or materials, war, governmental laws,
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regulations or restrictions or any other cause of any kind whatsoever
that is beyond the reasonable control of the party whose performance has
been delayed.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
by duly authorized officers or representatives as of the date first above
written.
XICOR INC. ZMD GMBH
By /s/ Xxxxx Xxxx By /s/ X. Xxxxx /s/ Xxxxxx Xxxxx
---------------------------------- --------------- -----------------
Xxxxx Xxxx Xx. Xxxxxxxx Xxxxx Xxxxxx Xxxxx
President and Chief Operating Officer Geschaftsfuhrer Geschaftsfuhrer
April 8, 1999 April 8, 1999
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LIST OF EXHIBITS
Number Title
1.3. Milestones for Process Qualification and
Production Operation
2.3 Facility Qualification
2.5 Xicor Deliverables
3.1 Prices
3.2 Initial Target Yields
4 Wafer Probe Documentation
5.3 Production Cycle Times
6.1 Process Qualification Criteria and Procedures
6.2 Product and Process Change Control
6.3 Specifications for Wafer Rework
6.4 Life Test and Reliability Monitors
6.6 Critical Processes
7.3 Shipping Documents
7.4 Quality Requirements
10.0 Products for Non-competition clause
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EXHIBIT 1.3
Milestones for Process Qualification and Production Operation
See attached project plan.
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EXHIBIT 2.3
Facility Qualification:
Verification per ISO 9001 criteria and QS9000 qualification shall be
completed prior to the beginning of Risk Production Starts.
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EXHIBIT 2.5
Xicor Deliverables
- Process Flow
- Lot Traveller
- Process Recipes
- Critical Monitor Data
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EXHIBIT 3.1
I. Non-recurring Expenses
Non-recurring expenses will be a total of $ * to be paid at 3 intervals:
A. 1st payment of $ * to be paid 30 days after the signing of the
Agreement by both parties .
B. 2nd payment of $ * to be paid at the start of the 1st qualification
lot as called for in the Process Qualification Milestones shown in
EXHIBIT 1.3.
C. 3rd and final payment of $ * to be paid at the beginning of RISK
production again as called for in the Process Qualification Milestones
shown in EXHIBIT 1.3.
II. Engineering Wafer cost $ * / Wafer
(Minimum Wafer Quantity is 6 wafers / Engineering Lot)
III. Payment and Shipping Terms:
A. Payment Terms--Payment terms are net 60 days from date of invoice
after the delivery of PCM tested wafers or 30 days from date of invoice
after the delivery of die sorted wafers.
B. Exchange Rate--All wafer/die prices set forth in this Agreement are
based on an exchange rate of 1.70DM = $U.S. $1. If the average exchange
rate for the previous six months is less than 1.60DM = $U.S. $1 or
exceeds 1.80DM = $U.S. $1, the parties will review the wafer/die as soon
as practicable to renegotiate prices. The exchange rate is defined as
the New York foreign exchange mid-range rates applying to trading among
banks in amounts of $1 million and more, as published in the Wall Street
Journal.
C. Shipping Terms--Shipping, delivery and pricing terms are set FCA
Dresden according Incoterms. Xicor will advise ZMD of its choice of
freight carrier.
D. Taxes and Duties -- The prices and fees do not include sales, use,
transfer, property, ad valorem, excise, privilege or value added taxes,
import duties, export duties or other custom duties or tariffs or any
other taxes, duties or charges not based on ZMD's net income, all of
which shall be paid by Xicor. Xicor agrees to promptly pay, or reimburse
ZMD for, the amount of such tax or charge and all reasonable attorneys'
fees and other costs and expenses incurred by ZMD in connection
therewith, and the amount of any fine or penalty assessed against ZMD in
connection therewith. Where applicable, Xicor will provide ZMD with
exemption certificate(s) in form and substance satisfactory to the
relevant taxing or governmental authorities.
IV. Wafer Prices (per 5" wafer)
A1: Wafer Pricing: (includes raw wafer costs)
C5.6 Wafers = Per following table (based on cumulative wafer
volume)
A.2.: C7 Technology: = to be defined separately
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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CUMULATIVE VOLUME WAFER PRICE (C5.6 @ * layers)
up to * wafers $ * /wafer
* to * wafers $ * /wafer
* to * wafers $ * /wafer
- For wafer volumes in excess of * , lower prices to be negotiated
- Wafer prices will be adjusted to the final production layer amount
with the following scheme
Production Wafer Price = (Wafer price as listed above / * ) *
Final production layer amount
Example: $ * = $ * x * / *
Timing: Once every 6 months. These calculations are inspired by
two things:
*
Calculation: Every 6 months, Xicor will calculate the actual die
sort yield percentages and compare them to the actual die sort
yield established in the first month following the initial 6
month period. This die sort yield percentage shall become the
target die sort yield, but in no case shall target die sort yield
be less than the actual established die sort yield at Xicor.
*
*
SCRAP CRITERIA
If the individual wafer sort yield falls below the mean-3sigma
distribution demonstrated for the 6 month interval, then, that
wafer is scrapped and returned back to ZMD for full credit.
A3: Device Pricing
To be defined separately.
A4: Die Test Pricing
To be defined separately.
V. Volume Expectations
The pricing provided for herein is based on an assumed volume of - *
wafers per month. If the actual wafer volumes differ significantly from
this assumption, the parties agree to meet as soon as practicable to
renegotiate pricing.
VI. Equipment
Xicor shall provide ZMD with the manufacturing equipment for production
of the Xicor technologies at ZMD on request by ZMD as follows:
. *
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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. *
Specific details will be mutually determined in a separate MOU.
As incremental wafer requirements occur similar arrangements for
additional equipment will be agreed upon.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXHIBIT 3.2
Initial Target Yields
Technology 1st 6 months Die Sort Yield
---------- ---------------------------
C5.6 * %
This average yield is limited to die sizes not larger than
12mm(squared). For die sizes larger than this size the die sort yield shall be
agreed upon before volume production.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXHIBIT 4
Wafer Probe Documentation
To be provided during technology transfer.
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EXHIBIT 5.3
Production Cycle Times:
Production Cycle Times shall be less than or equal to * days per mask
layer.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXHIBIT 6.1
Process Qualification Criteria and Procedures
- The quality and reliability specifications are defined in detail in
the following Xicor specifications: 06020110, 06020101, 06020311, and
06020324.
- ZMD shall provide Xicor with the following PQC for the required
processes:
- Gate Oxide integrity (Bvox and Qbd)
- Hot carrier
- Electromigration
- Stress Migration
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EXHIBIT 6.2
Product and Process Change Control
Product and process control changes are defined in the Xicor
specification 100213.
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EXHIBIT 6.3
Specifications for Wafer Rework
Xicor authorizes ZMD for the following reworks on Xicor products:
- Photoresist rework
All other rework not listed in this attachment is not authorized and requires
written approval by Xicor on either case-by-case base or an amendment to this
exhibit.
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EXHIBIT 6.4
Life Test and Reliability Monitors
The quality and reliability specifications are defined in detail in the
following Xicor specifications:
06020110, 06020101, 06020311, and 06020324.
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EXHIBIT 6.6
Critical Processes
Critical Processes defined by Xicor:
- *
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXHIBIT 7.3
Shipping Documents
To be generated later in conjunction with ZMD's capabilities and United
States and/or German Import/Export regulations..
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EXHIBIT 7.4
Quality Requirements
Quality requirements
- Monthly reporting of Cp and Cpk values for critical process
steps
- Process Control Plan
- Failure Mode Effects Analysis (FMEA) procedure established in
factory for process changes
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EXHIBIT 10
Products from Non-competition clause
ZMD explicitly is permitted to sell the following products and product families:
ZMD . nvSRAM products U63xxx
. SRAM products U62xxx
. DRAM products U61xxx
. Digitrim ZM534
. Ldreg ZM884
. Scope IC ZM407
. ASIC developments and Foundry Services according
ZMD customer specifications even if competitive
or similar to those manufactured by ZMD for Xicor
ZMD explicitly is NOT permitted to sell the following products and product
families:
1. E2 Micro-Peripherals:
- System Controller
X5114
- Microcontroller Supervisors with EEPROM
X25043 X25045 X25163 X25164 X25165
X25166 X25168 X25169 X25323 X25324
X25325 X25326 X25328 X25329 X25383
X25385 X25643 X25644 X25645 X25646
X25648 X25649
1. Parallel EEPROM's:
- Universal WordWide x8, x16, x32
XM28C010P XM28C020P XM2064P
- Universal ByteWide
X2804C X2816C X28C64/HC64 X28VC256 X28C256/HC256
X28C512 X28LC512 X28HT512 X28C010 X28HT010
XM28C010 XM28C020 XM28C040 XM28C080
1. Micro Port Saver (MPS) EEPROM
X84041 X84161 X84641 X84129
2. Serial
- NOVRAM
X24C44 X24C45 X25401
- EEPROM
X24C00 X24C01 X24C01A X24C02 X24C04
X24C08 X24C16 X24001 X24012 X24022
X24042 X24128 X24164 X24165 X24320
X24321 X24325 X24640 X24641 X24645
X25C02 X25020 X25040 X25057 X25080
X25097 X25128 X25138 X25160 X25320
X25330 X25383 X25385 X25640 X25642
X25650
- Serial Flash
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X24F016 X24F032 X24F064 X24F128 X25F008
X25F016 X25F032 X25064 X25F128 X25F047
X25F087
1. Parallel NOVRAMs
X20C04 X20C05 X20C16 X20C17 XM20C64
X22C10 X22C12
2. Digitally Controlled Potentiometers
- Quad 64 Tap DCP
X9241Y X9241W X9241U X9241M X9400W
X9408W X9410W X9418W X9448W
- 32 Tap DCP
X9313Z X9313W X9313U X9313T X9314W
X9315Z X9315W X9316Z X9316W
- Dual 64 Tap DCP
X9221Y X92221W X9221U X9410W X9418W
- 100 Tap DCP
X9C102 X9C103 X9C503 X9C104 X9312Z
X9312W X9312U X9312T
- 32 Tap PushPOTs
X9511Z X9511W X95514W
1. Smart Card Modules
X76F041 X76F100 X76F101 X76F128 X76F640
X24026 X24165 X24325 X24645 X25320
X25650
2. Secure Serial Flash
X76F041 X76F100 X76F101 X76F128 X76F640
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