EXHIBIT 10.35
COMMON R&D AND PARTICIPATION AGREEMENT
This Agreement is made and entered into by and between Toshiba Corporation, a
Japanese corporation with a principal place of business at 1-1, Xxxxxxxx
0-xxxxx, Xxxxxx-xx, Xxxxx 000-0000, Xxxxx, (hereinafter "Toshiba"), and SanDisk
Corporation, a Delaware corporation with a principal place of business at 000
Xxxxxxx Xxxxx, Xxxxxxxxx, XX 00000, U. S. A. (hereinafter "SanDisk").
WHEREAS, Toshiba is developing certain manufacturing process technology common
to Toshiba semiconductor products, including NAND Flash Memory Products as
defined in Section 2.02 of the Master Agreement among Semiconductor North
America, Inc., Toshiba and SanDisk; and
WHEREAS, SanDisk desires to participate in Toshiba's development of said process
technology in order to enhance a common process technology used in NAND Flash
Memory Products;
WHEREAS, it is understood that such enhanced common process technology will be
transferred into production at Toshiba's manufacturing facilities (the Yokkaichi
Facility and Dominion Semiconductor L.L.C.) from which both parties will
purchase NAND Flash Memory Products.
NOW, THEREFORE, in consideration of the mutual covenants and premises contained
herein, the parties agree as follows:
ARTICLE 1. DEFINITIONS
1.1 "Contract Technology" shall mean the manufacturing process technology
(with design rules of 0.16(microns), 0.13(microns) *
the details of which are set forth in Exhibit A attached hereto) for
Toshiba's NAND Flash Memory Product(s).
1.2 "AMC" shall mean the Advanced Microelectronics Center, Toshiba's
development engineering facility located in Yokohama, Japan.
1.3 "Assignees" shall mean SanDisk's engineers from the technology areas
of process/device/design, assigned to participate in the Development
Work (as defined in Section 2.1 below) to be performed at AMC or other
Toshiba facilities to be mutually agreed upon by the parties hereto.
1.4 "Effective Date" shall mean the Closing Date.
1.5 "Solely Developed Patents" shall mean patents, utility models
(excluding design patents) and any applications therefor which arise
out of the inventions made solely by the employees of either party
during the performance of the Development Work hereunder.
CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISION. CONFEDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
* INDICATES THAT CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISION PURSUANT TO RULE 24b-2.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED
PORTIONS.
1.6 "Jointly Developed Patents" shall mean patents, utility models
(excluding design patents) and any applications therefor which arise
out of the inventions jointly made by the employees of Toshiba and
SanDisk during the performance of Development Work hereunder.
1.7 "Agreement" shall mean this Common R&D and Participation Agreement
together with any Exhibits, Schedules, Appendices and Attachments
hereto and the Rules Document.
1.8 "Rules Document" shall mean the Definitions, Rules of Construction
and Documentary Conventions, attached as Appendix A.
1.9 "Residuals" shall mean that technical information which may be
retained in the memories of Assignees who have had rightful access to
Toshiba's proprietary information and Contract Technology.
ARTICLE 2. DEVELOPMENT COLLABORATION
2.1 SanDisk will send, and Toshiba will receive, such number of
Assignees as are mutually agreed upon, at AMC or other Toshiba
facilities during the term of this Agreement in order for SanDisk to
participate in the development work of the Contract Technology as set
forth in Exhibit B (the "Development Work"), which may be modified by
Toshiba and SanDisk from time to time, and in accordance with the
direction of Toshiba; PROVIDED THAT such modification to the
Development Work shall not materially affect SanDisk's permitted access
to the Contract Technology. For avoidance of doubt, it is agreed by the
parties that SanDisk shall not have any right to have access to, and
its Assignees shall not have access to, any technical information or
data which are not relevant or necessary to perform the Development
Work or any technical information or data for which access by Assignees
is prohibited by any binding contract of Toshiba and any third party,
and that no right or license is granted to SanDisk with respect to said
technical information or data. The project managers of SanDisk and
Toshiba shall periodically discuss, determine and monitor the details
of the Development Work; PROVIDED THAT in case of any dispute between
the respective project managers, the manager of Toshiba may determine
such details, taking into consideration the reasonable input made by
SanDisk. In order to perform the Development Work, Toshiba shall
provide the Assignees with sufficient office equipment, including
personal computers and telephones.
2.2 SanDisk shall ensure that its Assignees shall comply with the
safety, security and all other applicable practices, regulations of
Toshiba and specific instructions or directions to be made by Toshiba
while such Assignees are in Toshiba's facilities. SanDisk agrees to be
responsible for all salaries, benefits, expense reimbursements and
other payments to its Assignees and workers insurance for Assignees and
shall indemnify and hold Toshiba harmless from any claims against
Toshiba arising out of any injury to any Assignee.
2.3 SanDisk shall be responsible for the living, traveling and all other
out-of-pocket expenses for its Assignees.
2
ARTICLE 3. OWNERSHIP
3.1 All technical information provided by any party in the course of
the development of the Contract Technology shall remain the exclusive
property of said party; provided that, Toshiba shall have a
non-exclusive, worldwide and royalty-free license to use, reproduce and
otherwise dispose of such technical information for any purpose.
3.2 All technical information, inventions and intellectual property
rights resulting therefrom (but specifically exclude patents) made or
generated by Toshiba and/or Assignees in the course of the Development
Work shall be the exclusive property of Toshiba; PROVIDED THAT, SanDisk
shall have the right and license set forth in Article 4.
3.3 Any Solely Developed Patent of Toshiba shall be and remain the
exclusive property of Toshiba, subject to the licenses granted to
SanDisk in accordance with Article 4.1 hereof.
3.4 Any Solely Developed Patent of SanDisk shall be and remain the
exclusive property of SanDisk, subject to the licenses granted to
Toshiba in accordance with Article 4.3 hereof.
3.5 Any right, title and interest in, to and under Jointly Developed
Patents shall be jointly owned by Toshiba and SanDisk. Each party shall
be free to use such Jointly Developed Patents for any purpose and shall
have the right to grant non-exclusive licenses to any third party
without the consent of the other party. Both parties shall promptly
agree on which of them shall file and prosecute the first patent
application and which countries' corresponding applications shall be
filed and by whom. All expenses incurred in obtaining and maintaining
such patents shall be equally shared by the parties; PROVIDED THAT if
one party elects not to seek or maintain such patents in any particular
country or not to share equally in the expense thereof, the other party
shall have the right to seek or maintain such patents in said country
at its own expense and shall have full control over the prosecution and
maintenance thereof even though title to any patent issuing thereon
shall be joint. The party electing not seek or maintain such patents
shall give the other party any necessary assistance required for the
preparation and prosecution of such patents filed or maintained by the
other party.
3.6 It is understood by the parties that either party may perform
development of any products or process independently of the development
of the Contract Technology hereunder. This Agreement is not intended to
limit such independent development involving technology or information
of a similar nature to the Contract Technology.
ARTICLE 4. LICENSE
4.1 Toshiba shall grant to SanDisk a non-exclusive,
non-transferable, worldwide and royalty-free license, without the right
to sublicense, under its Solely Developed Patents to develop, have
developed, make, have made, use, sell, modify and otherwise dispose of
any semiconductor products.
3
4.2 Subject to SanDisk's confidentiality obligations under Article 8
and the provisions of Articles 3, 6, 7 and 10, SanDisk shall be free to
use, improve or modify without additional compensation to Toshiba the
Residuals, including but not limited to the use, improvement or
modification of such Residuals in the development and manufacture of
SanDisk's products, provided that this Article, by itself, shall not be
deemed to grant to SanDisk any rights or licenses under any patents of
Toshiba nor shall this Article operate to waive SanDisk's
confidentiality obligations under Article 8. In no event shall such
Assignee or SanDisk publish or disseminate said Residuals to any third
party.
4.3 SanDisk shall grant to Toshiba a non-exclusive, non-transferable,
worldwide and royalty-free license, without the right to sublicense,
under its Solely Developed Patents to develop, have develop, make,
have made, use, sell, modify and otherwise dispose of any
semiconductor products.
4.4 Toshiba shall prepare and transfer to the Yokkaichi Facility and
Dominion Semiconductor L.L.C. documentation for NAND process concerning
the Contract Technology for production at the Yokkaichi Facility and
Dominion Semiconductor, L.L.C.; PROVIDED, HOWEVER, that SanDisk may
access to such documentation at such facilities but shall have no right
to disclose or transfer them to any third party.
ARTICLE 5. COMMON R&D EXPENDITURE
5.1 Provided Toshiba continues to develop and advance NAND Flash
Memory technology for the benefit of both parties pursuant to the
Operative Documents, SanDisk hereby agrees to share Toshiba's Common
R&D expenditures and shall pay to Toshiba its portion of such Common
R&D expenditures in accordance with this Section 5.1:
(i) From the Effective Date through and including March 31, 2002:
SanDisk will share in Toshiba's Common R&D expenditures as set
forth in Table A below, and SanDisk shall pay Toshiba for such
Common R&D expenditures in the amounts and on or prior to the
dates provided in Table B as follows:
----------------------------------------------------------------------------------------------------------------------
Table A
----------------------------------------------------------------------------------------------------------------------
SanDisk's Allocation of Common R&D Expenses
----------------------------------------------------------------------------------------------------------------------
2000 2001 2002
----------------------------------------------------------------------------------------------------------------------
2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
---------------- -------------- ------------- -------------- ------------- -------------- -------------- -------------
(amounts incurred in millions of Yen)
----------------------------------------------------------------------------------------------------------------------
* * * * * * * *
---------------- -------------- ------------- -------------- ------------- -------------- -------------- -------------
----------------------------------------------------------------------------------------------------------------------
Table B
----------------------------------------------------------------------------------------------------------------------
Payment by SanDisk for Common R&D Expenses
----------------------------------------------------------------------------------------- ----------------------------
2002 Total
----------------------------------------------------------------------------------------- ----------------------------
June 30 September 30 December 31
------------------------------- ---------------------------- ---------------------------- ----------------------------
4
* INDICATES THAT CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISION PURSUANT TO RULE 24b-2.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED
PORTIONS.
----------------------------------------------------------------------------------------------------------------------
(amounts payable in millions of Yen)
----------------------------------------------------------------------------------------------------------------------
* * * *
------------------------------- ---------------------------- ---------------------------- ----------------------------
Notwithstanding the foregoing, in the event of the termination of this Agreement
(i) on or before March 31, 2002, SanDisk shall be obligated immediately to pay
its share of the allocated Common R&D expenses accrued through the date of such
termination (pro-rated in the event such termination occurs prior to the end of
a quarter) as set forth in Table A, (ii) after March 31, 2002 but prior to
December 31, 2002, SanDisk's shall be obligated immediately to pay any unpaid
amount set forth in Table B.
(ii) After March 31, 2002:
The parties acknowledge that after March 31, 2002, it will be
difficult to predetermine Toshiba's total Common R&D
expenditures and a fixed allocation of Common R&D expenditures
for SanDisk. Therefore, after March 31, 2002, the payment by
SanDisk to Toshiba for Common R&D expenditures will be based
on a percentage of SanDisk's Net Sales (as hereinafter
defined), and calculated and paid as follows:
Within thirty days of the end of each calendar quarter based
on SanDisk's Net Sales of NAND Flash Memory Products for the
quarter just ended as follows:
a) * of the first US $ 100 million for the quarter
reported;
b) * of the next US $ 100 million for the quarter
reported; and
c) * of net sales in excess of US $ 200 million per
quarter.
For the purpose of this Article, "Net Sales" shall mean the
invoice price for NAND Flash Memory Products billed by
SanDisk.
(iii) Notwithstanding (ii) above, SanDisk's quarterly
contribution for Common R&D pursuant to (i) and (ii) above shall not exceed the
sum of (a) * of the total Common R&D annual expenditure of
the Semiconductor Company of Toshiba, as notified to SanDisk by Toshiba at the
beginning of each of Toshiba fiscal year ("Total R&D Budget") for the first
* of the Total R&D Budget and (b) * of the
portion of such Total R&D Budget in excess of * .
(iv) Notwithstanding (iii) above, in the event that the Total
R&D Budget is likely to substantially exceed * for any calendar
year due to the development of the NAND Flash Memory technology with design
rules of * micron or less and/or development of such
technology applicable to twelve inches wafer, both parties shall discuss in good
faith to determine the fair methodology to share such Toshiba's Common R&D
expenditures.
5
* INDICATES THAT CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISION PURSUANT TO RULE 24b-2.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED
PORTIONS.
(v) The amount of the Total R&D Budget shall be subject to
verification if requested by SanDisk by disclosing internal Toshiba documents to
an independent certified public accountant appointed by SanDisk which shall
verify the stated amount of the Total R&D Budget, by written certification to
SanDisk by the appropriate officer of the Semiconductor Company of Toshiba. Such
verification shall be conducted, at SanDisk's cost and expense, during normal
business hours of Toshiba and not more frequently than annually.
(vi) Within 45 days of the start of each of its fiscal years, Toshiba
shall provide SanDisk with a 1-2 day detailed presentation of Toshiba's process
development activity at AMC and other Toshiba facilities for the previous
calendar year and forecasted activity for the new fiscal year as such activity
relates to or affects NAND Flash Memory. Any expenses incurred for such
presentation shall be borne by the party incurring such expenses.
5.2 Payments of the fees provided for in Article 5.1 (other than
Article 5.1(i), which payments shall be made on or before the dates
specified therein) shall be made by SanDisk within sixty (60) days
after receiving the invoice to be issued by Toshiba at the end of each
applicable calendar quarter. For the purpose of Toshiba's issuance of
such invoices, SanDisk shall submit to Toshiba, within 30 days
following the end of each quarter after April 1, 2002, a written report
stating the quantity and Net Sales of NAND Flash Memory Products sold
or otherwise disposed of by SanDisk during the applicable quarter.
5.3 All payments under Article 5.1 shall be made in Japanese yen by
wire transfer of immediately available funds to the following account
or such other account as may be designated by Toshiba to SanDisk in
writing:
Toshiba Corporation, Account No. 0000000, The Sakura Bank, Ltd., Tokyo
Main Office 0-0-0, Xxxxxx-xxx, Xxxxxxx-xx, Xxxxx 000, Xxxxx (Tel:
00-0-0000-0000)
Where the provisions of this Agreement require the conversion of an
amount initially computed in another currency into Japanese Yen, the
Japanese Yen amount payable shall be calculated using the New York
foreign exchange mid range rates (Currency per US Dollars) published in
THE WALL STREET JOURNAL, Western Edition, on the last business day such
journal is published in the calendar quarter immediately preceding the
date of payment.
5.4 All payments provided for in Article 5.1 shall be made without
deduction of taxes; PROVIDED, HOWEVER, that in the event any
withholding income tax is imposed by U.S. tax authorities on any amount
payable to Toshiba hereunder, SanDisk may withhold such income tax from
such amount to the extent that Toshiba may obtain a tax credit against
its Japanese income tax. SanDisk shall without undue delay obtain and
send to Toshiba tax certificates evidencing the tax amount withheld and
paid to U.S. tax authorities.
5.5 In the event any compensation payable to Toshiba by SanDisk
under this Agreement becomes overdue other than as a result of any
action or inaction on the part of Toshiba, Toshiba shall be entitled to
request SanDisk to pay interest at twelve percent (12%) per annum until
such compensation is paid.
6
5.6 Toshiba shall have the right, at its sole cost and expense, to
have an independent certified public accountant conduct during normal
business hours and not more frequently than annually, an audit of the
appropriate records of SanDisk to verify the number of units of NAND
Flash Memory Products sold or otherwise disposed of by SanDisk and
SanDisk's calculation of the fees and Net Sales pursuant to Article 5.1
above.
ARTICLE 6. WARRANTY
6.1 Each party provides to the other party its technical information
on an "as-is" basis only, and does not make any warranty or
representation with respect to such technical information for any
purpose.
6.2 Nothing contained in this Agreement shall be construed as:
(a) a warranty or representation that the manufacture, use,
sale or other disposal of semiconductor products by the other
party using any technical information received under this
Agreement will be free from infringement of patents or any
other intellectual property rights of any third party;
(b) conferring the other party any right to use in advertising,
publicity or otherwise any trademark, trade name or names,
or any contraction, abbreviation or simulations thereof of
either party;
(c) conferring the other party, by implication, estoppel or
otherwise, any license or other right, except for the
licenses and rights expressly granted hereunder; and
(d) an obligation to furnish any technical information or
know-how except as otherwise specifically provided herein.
ARTICLE 7. LIMITATION OF LIABILITY
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR ANY SPECIAL,
CONSEQUENTIAL, INCIDENTAL OR INDIRECT DAMAGE OF ANY KIND, (INCLUDING WITHOUT
LIMITATION LOSS OF PROFIT OR DATA) WHETHER OR NOT ADVISED OF THE POSSIBILITY OF
SUCH LOSS.
ARTICLE 8. CONFIDENTIALITY
8.1 As used in this Agreement, the term "Confidential Information"
shall mean any information disclosed by Toshiba to SanDisk 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 Toshiba to
SanDisk pursuant to this Agreement, provided that such information is
designated in a manner to indicate its confidential nature at the time
of disclosure and reduced to a written summary by Toshiba within thirty
(30) days after its oral disclosure. For avoidance of doubt, all
information observed by or disclosed to Assignees at Toshiba's
facilities shall be treated as Toshiba Confidential Information.
7
8.2 During the ten (10) year period following receipt of such
information, the receiving party shall keep any Confidential
Information, including but not limited to the technical information
SanDisk has access to at AMC during the course of the development of
the Contract Technology hereunder, in strict confidence, and shall not
disclose such Confidential Information to any third party without prior
written consent of the disclosing party. The receiving party shall
maintain the Confidential Information with at least the same degree of
care that the receiving party uses to protect its own strictly
confidential information, but no less care than is reasonable under the
circumstances. Further, the receiving party shall not use the
Confidential Information for any purposes other than for the
development of the Contract Technology hereunder, except as otherwise
provided herein.
8.3 Neither party shall disclose the terms and conditions of this
Agreement to any third party other than in compliance with any
government regulation, without prior written consent of the other
party.
8.4 The confidentiality obligation set forth in Articles 8.2 and 8.3
above shall not apply to any information which:
(a) is already known by the receiving party at the time of
disclosure;
(b) is or becomes publicly known through no fault of the receiving
party;
(c) is rightfully received by the receiving party from a third
party without any restriction on disclosure;
(d) is independently developed by the receiving party;
(e) is disclosed with the prior written consent of the disclosing
party hereunder; or
(f) is disclosed pursuant to applicable laws, regulations
or court order; provided, that the receiving party shall give
the disclosing party prompt notice of such request so that the
disclosing party has an opportunity to defend, limit or
protect such disclosure.
8.5 Each party understands that any disclosure or dissemination of
the other party's Confidential Information not expressly authorized
hereunder would cause irreparable injury to such other party, for which
monetary damages would not be an adequate remedy and said other party
shall be entitled to equitable relief in addition to any remedies the
other party may have hereunder or at law. In the event SanDisk is to
enter into any joint development work with any third party, SanDisk
warrants that Toshiba Confidential Information provided to SanDisk in
connection with the development of the Contract Technology shall
neither be used for such joint development work nor be disclosed to any
third party unless expressly otherwise provided hereunder.
8
ARTICLE 9. TERM AND TERMINATION
9.1 This Agreement shall become effective on the Effective Date and
continue in full force and effect until the termination of the Master
Agreement, unless earlier terminated as hereinafter provided. The term
of this Agreement may be extended by mutual agreement of both parties.
This Agreement shall automatically terminate upon termination of the
Master Agreement.
9.2 If either party fails to perform or breaches any of its material
obligations under this Agreement, then, upon sixty (60) days written
notice specifying such failure or breach, the non-defaulting party
shall have the right to terminate this Agreement forthwith, unless the
failure or breach specified in the notice has been cured during the
sixty (60) day period. Termination of this Agreement pursuant to this
Article 9.2 shall not relieve the breaching party from any liability
arising from any breach of this Agreement and such termination shall be
without prejudice to any other rights and remedies of the non-breaching
party provided at law or in equity, in addition to the rights and
remedies set forth in this Agreement.
9.3 Either party shall have the right to terminate this Agreement by giving
written notice to the other party upon the occurrence of any of the
following events:
(a) the filing by the other party of a voluntary petition in
bankruptcy or insolvency;
(b) any adjudication that such other party is bankrupt or
insolvent;
(c) the filing by such other party of any legal action or document
seeking reorganization, readjustment or arrangement of its
business under any law relating to bankruptcy or insolvency;
(d) the appointment of a receiver for all or substantially all of
the property of such other party; or
(e) the making by such other party of any assignment of whole or
substantial assets for the benefit of creditors.
This Agreement shall terminate on the thirtieth (30th) day after such
notice of termination is given.
9.4 The provisions of Articles 3, 6, 7, 8, 9 and 10 shall survive
any termination or expiration of this Agreement. The provision of
Article 4 shall survive the expiration of this Agreement, PROVIDED THAT
SanDisk has paid to Toshiba the total amount of fees required to be
paid in Article 5.
ARTICLE 10. GENERAL PROVISIONS
10.1 All notices required or permitted to be given hereunder shall be
in writing and shall be delivered by prepaid air express or registered
airmail, postage prepaid or by telefax, if
9
confirmed or acknowledged, to the following or to such changed address
as may have been previously specified in writing by the addressed
party:
If to Toshiba:
(For technical coordination matters)
Toshiba Corporation
1-1, Xxxxxxxx 0-xxxxx
Xxxxxx-xx, Xxxxx 000-0000
Xxxxx
Telephone: 000 00 00000 0000
Facsimile: 011 81 45890 2793
Attention: Senior Manager Flash Memory Engineering
(For general contract matters)
Toshiba Corporation
Semiconductor Company
1-1 Xxxxxxxx 0-Xxxxx
Xxxxxx-Xx, Xxxxx 000-0000 Xxxxx
Telephone: 000 00 0 0000 0000
Facsimile: 011 81 3 5444 9339
Attention: President
With a copy to:
Toshiba Corporation
Semiconductor Company
Legal Affairs and Contracts Division
1-1 Xxxxxxxx 0-Xxxxx
Xxxxxx-Xx, Xxxxx 000-0000 Xxxxx
Telephone: 000-00-0-0000-0000
Facsimile: 011-81-3-5444-9342
Attention of General Manager
If to SanDisk:
(For technical coordination matters)
SanDisk Corporation
000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: General Manager, NAND Division
10
(For general contract matters)
SanDisk Corporation
000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: President and CEO
With a copy to:
SanDisk Corporation
000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Vice President and General Counsel
10.2 Neither party is required to disclose any information of which
disclosure is prohibited by laws of the country of such party.
10.3 Neither party shall export or re-export, directly or indirectly,
any technical information disclosed hereunder or direct product thereof
to any destination prohibited or restricted by the export control
regulations of Japan and the United States, including the U.S. Export
Administration Regulations, without the prior authorization from the
appropriate governmental authorities. SanDisk hereby certifies that
SanDisk will not use technical information supplied by Toshiba
hereunder for any purpose to develop or manufacture nuclear, chemical,
biological weapons or missiles (hereafter "weapons of mass
destruction"). SanDisk further certifies that it will not sell any
products manufactured using Toshiba's technical information to any
party if it knows that the end-user of the products will use them for
the development and/or manufacture of the weapons of mass destruction.
10.4 The Rules of Construction and Documentary Conventions set forth
in the Definitions, Rules of Construction and Documentary Conventions
attached as Appendix A shall apply to, and are hereby incorporated in,
this Agreement.
[Rest of Page Intentionally Blank]
11
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in duplicate, as of the date written below, by their duly authorized officers or
representatives.
Toshiba Corporation SanDisk Corporation
By: /S/ Xxxxx Xxxxxxxx By: /S/ Xxx Xxxxxx
_________________________________ __________________________________
Name: Xxxxx Xxxxxxxx Name: Xxx Xxxxxx
Title: Corporate Senior Vice President Title: President and CEO
and Director
President and CEO
Semiconductor Company
Date: May 9, 2000 Date: May 9, 2000
12
EXHIBIT A
(Contract Technology)
1. Toshiba's 0.16(micron) NAND Flash memory process:
minimum gate length: 0.16(micron)
2. Toshiba's 0.13(micron) NAND Flash memory process:
minimum gate length: 0.13(micron)
3. Toshiba's * micron NAND Flash memory process:
minimum gate length: * micron
* INDICATES THAT CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISION PURSUANT TO RULE 24b-2.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED
PORTIONS.
EXHIBIT B
*
(1) *
(2) *
(3) *
* INDICATES THAT CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED
AND FILED SEPARATELY WITH THE COMMISION PURSUANT TO RULE 24b-2.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED
PORTIONS.
APPENDIX A
DEFINITIONS, RULES OF CONSTRUCTION AND
DOCUMENTARY CONVENTIONS
In any agreement or instrument that incorporates the definitions set forth
in this Appendix and states that the rules of construction and documentary
conventions set forth herein shall apply to such agreement or instrument, then,
unless such agreement or instrument otherwise requires:
ARTICLE I
DEFINITIONS
The following terms shall have the specified meanings:
"Accountants" means such firm of nationally recognized independent
certified public accountants for the Company as is appointed pursuant to the
Operating Agreement from time to time. Initially, the Accountants shall be
Deloitte & Touche LLP.
"Act" means the Virginia Limited Liability Company Act, as in effect from
time to time.
"Affiliate" of any Person means any other Person which directly or
indirectly controls, is controlled by or is under common control with, such
Person; PROVIDED, HOWEVER, that the term Affiliate, (a) when used in relation to
the Company, shall not include either Member or any of its Affiliates, and (b)
when used in relation to a Member or any of its Affiliates, shall not include
the Company or any of its Subsidiaries.
"Articles" means the Articles of Organization of the Company.
"Bankruptcy Event" means, with respect to any Person, the occurrence or
existence of any of the following events or conditions: such Person (1) is
dissolved; (2) becomes insolvent or fails or is unable or admits in writing its
inability generally to pay its debts as they become due; (3) makes a general
assignment, arrangement or composition with or for the benefit of its creditors;
(4) institutes or has instituted against it a proceeding seeking a judgment of
insolvency or bankruptcy or any other relief under any bankruptcy or insolvency
law or other similar law affecting creditors' rights, or a petition is
presented for its winding up or liquidation and, in the case of any such
proceeding or petition instituted or presented against it, such proceeding or
petition (A) results in a judgment of insolvency or bankruptcy or the entry of
an order for relief or the making of an order for its winding up or liquidation
or (B) is not dismissed, discharged, stayed or restrained in each case within 60
days of the institution or presentation thereof; (5) has a resolution passed by
its governing body for its winding-up or liquidation; (6) seeks or becomes
subject to the appointment of an
administrator, receiver, trustee, custodian or other similar official for it or
for all or substantially all its assets (regardless of how brief such
appointment may be, or whether any obligations are promptly assumed by another
entity or whether any other event described in this clause (6) has occurred and
is continuing); (7) experiences any event which, under the applicable laws of
any jurisdiction, has an analogous effect to any of the events specified in
clauses (1) through (6) above; or (8) takes any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the foregoing
acts.
"Burdensome Condition" means, with respect to any proposed transaction, any
action taken, or credibly threatened, by any Governmental Authority or (except
if such action or threat is frivolous) other Person to challenge the legality of
such proposed transaction, including (i) the pendency of a governmental
investigation (formal or informal) in contemplation of the possible actions
described in clauses (ii)(A), (ii)(B) or (ii)(C) below, (ii) the institution of
a suit or the written threat thereof (A) seeking to restrain, enjoin or prohibit
the consummation of such transaction or material part thereof, to place any
material condition or limitation upon such consummation or to invalidate,
suspend or require modification of any material provision of any Operative
Document, (B) challenging the acquisition by either Member of its interest in
the Company or (C) seeking to impose limitations on the ability of either Member
effectively to exercise full rights as a Member in the Company, including the
right to act on all matters properly presented to the Members pursuant to the
Operating Agreement, or (iii) an order by a court of competent jurisdiction
having any of the consequences described in (ii)(A), (ii)(B) or (ii)(C) above,
or placing any conditions or limitations upon such consummation that are
unreasonably burdensome in the reasonable judgment of the applicable Person.
"Business Day" means any day (other than a day which is a Saturday, Sunday
or legal holiday in the State of California, the Commonwealth of Virginia or
Japan) on which banks are open for business in California, Virginia, and Tokyo,
Japan.
"Business Plan" means the Initial Business Plan and each subsequent
business plan, including budgets and projections for the Company for each
relevant period, adopted in accordance with Section 3.04(c) of the Operating
Agreement and complying with Section 3.04(b) of the Operating Agreement.
"Capital Contribution" means each capital contribution to be made by each
Member pursuant to Schedule 6.01 to the Operating Agreement.
"Capital Transaction" means a disposition by the Company of property which
is or has been property of a character subject to the allowance for depreciation
provided in Section 167 of the Code if such disposition results in the
recognition of gain or loss by the Company. In addition, if the value of
property is adjusted pursuant to Section 7.01(B) of the Operating Agreement, the
amount of such adjustment shall be treated as an item of gain from a Capital
Transaction (if the adjustment is a positive adjustment) or an item of loss from
a Capital Transaction (if the adjustment is a negative adjustment).
2
"Change of Control" with respect to a Person means a transaction or series
of related transactions as a result of which (i) more than 50% of the beneficial
ownership of the outstanding common stock or other ownership interests of such
Person (representing the right to vote for the Board of Directors or similar
organization of such Person) is acquired by another Person or affiliated group
of Persons, whether by reason of stock acquisition, merger, consolidation,
reorganization or otherwise or (ii) the sale or disposition of all or
substantially all of a Person's assets to another Person or affiliated group of
Persons.
"Closing" means the closing of the transactions described in Section 3.01
of the Master Agreement.
"Closing Date" means the date mutually agreed for the Closing by the
parties to the Master Agreement; PROVIDED, HOWEVER, that in no event will the
Closing Date be later than September 1, 2000, without the written agreement of
both Parents.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor statute. ANY reference to a particular provision of the
Code or a Treasury Regulation promulgated pursuant to the Code means, where
appropriate, the corresponding provision of any successor statute or regulation.
"Company" means FlashVision, L.L.C., a limited liability company formed by
the Members under the laws of thE Commonwealth of Virginia.
The term "control" (including its correlative meanings "controlled by" and
"under common control with") means possession, directly or indirectly, of power
to direct or cause the direction of management or policies (whether through
ownership of securities or partnership or other ownership interests, by contract
or otherwise).
"DSC" means Dominion Semiconductor Company, L.L.C.
"DSC Foundry Agreement" means the Foundry Agreement between DSC and the
Company.
"Event of Default" means, with respect to a Member, the occurrence or
existence of any of the following events or conditions which remains uncured for
sixty (60) days following receipt of written notice thereof:
(a) a Bankruptcy Event of such Member or its Parent or any Person of which
such Member is a Subsidiary;
(b) the failure of such Member to make any required Capital Contribution
within forty-five (45) Business Days after receipt of written notice from the
Company or the other Member that such Capital Contribution was not made when due
under the Operating Agreement; or
3
(c) the breach by such Member of its covenant in Section 9.01 of the
Operating Agreement or the breach by the Parent of such Member of its covenant
in Section 6.01(c) of the Master Agreement, provided that a Change of Control of
Member or of a Parent shall not be deemed a event of default.
"Fiscal Quarter" means, unless changed by the Operating Committee, a
calendar quarter.
"Fiscal Year" means, unless otherwise required by the Code or applicable
Treasury Regulations, the one year period commencing on April 1 of each year.
"Foundry Agreements" means, collectively, the DSC Foundry Agreement and the
Yokkaichi Foundry Agreement.
"GAAP" means generally accepted accounting principles in the United States
as in effect from time to time, consistently applied.
"GAAS" means generally accepted auditing standards in the United States as
in effect from time to time.
"Governmental Action" means any authorization, consent, approval, order,
waiver, exception, variance, franchise, permission, permit or license of, or any
registration, filing or declaration with, by or in respect of, any Governmental
Authority.
"Governmental Authority" means any United States or Japanese federal,
state, local or other political subdivision or foreign governmental Person,
authority, agency, court, regulatory commission or other governmental body,
including the Internal Revenue Service and the Secretary of State of any State.
"Governmental Rule" means any statute, law, treaty, rule, code, ordinance,
regulation, license, permit, certificate or order of any Governmental Authority
or any judgment, decree, injunction, writ, order or like action of any court or
other judicial or arbitration tribunal.
"HSR Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976
and the rules and regulations promulgated thereunder.
"Indebtedness" of any Person means, without duplication:
(a) all obligations (whether present or future, contingent or otherwise, as
principal or surety or otherwise) of such Person in respect of borrowed money or
in respect of deposits or advances of any kind;
(b) all obligations of such Person evidenced by bonds, debentures, notes or
similar instruments;
4
(c) all obligations of such Person upon which interest charges are
customarily paid, except for trade payables;
(d) all obligations of such Person under conditional sale or other title
retention Agreements relating to property or assets purchased by such Person;
(e) all obligations of such Person issued or assumed as the deferred
purchase price of property or services (other than with respect to the purchase
of personal property under standard commercial terms);
(f) all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed;
(g) all guarantees by such Person of Indebtedness of others;
(h) all obligations of such Person to pay rent or other amounts under any
lease of (or other arrangement conveying the right to use) real or personal
property (or a combination thereof), which obligations would be required to be
classified and accounted for as capital leases on a balance sheet of such Person
prepared in accordance with GAAP;
(i) all obligations of such Person (whether absolute or contingent) in
respect of interest rate swap or protection agreements, foreign currency
exchange agreements or other interest or exchange rate hedging arrangements; and
(j) all obligations of such Person as an account party in respect of
letters of credit and bankers' acceptances.
The Indebtedness of any Person shall include the Indebtedness of any
partnership in which such Person is a general partner.
"Initial Business Plan" means the initial business plan of the Company as
agreed to and adopted by the members concurrently with the execution of the
Master Agreement.
"License Agreement" means the Patent Cross License Agreement dated July 30,
1997 by and between Toshiba and SanDisk.
"Lien" means, with respect to any asset, (a) any mortgage, deed of trust,
lien, pledge, encumbrance, charge OR security interest in or on such asset, (b)
the interest of a vendor or a lessor under any conditional sale agreement,
capital lease or title retention agreement relating to such asset and (c) in the
case of securities, any purchase option, call or similar right with respect to
such securities.
5
Any reference to any event, change or effect being "material" with respect
to any Person means an event, change or effect which is or, insofar as
reasonably can be foreseen, will be material to the condition (financial or
otherwise), properties, assets, liabilities, capitalization, licenses,
businesses, operations or prospects of such Person and, in the case of the
Company, the capital accounts of the members or the ability of the Company to
carry out its then current Business Plan.
"Master Agreement" means the Master Agreement dated as of May 9, 2000 by
and among Toshiba, SENA and SanDisK.
"Member" means, in the case of the Company, each of SENA and SanDisk, and
any other Person who becomes a member in the Company in accordance with the
terms of the Operating Agreement.
"Membership Interest" means a Member's aggregate rights in the Company,
including the Member's right to a share of the profits and losses of the
Company, the right to receive distributions from the Company and the right to
vote and participate in the management of the Company.
"Member Representative" means, with respect to the Company, a member of the
Operating Committee appointed pursuant to Section 5.01(b) of the Operating
Agreement.
"Net Book Value" means, with respect to any Person, the total assets of
such Person less the total liabilities of such Person, in each case as
determined in accordance with GAAP.
"Net Profits" and "Net Losses" means, subject to Section 7.02 of the
Operating Agreement, the taxable income and tax loss of the Company for Federal
income tax purposes for a given Fiscal Year, increased by the amount of any tax
exempt income of the Company during such Fiscal Year and decreased by the amount
of any Code Section 705(a)(2)(B) expenditures (within the meaning of Treasury
Regulation Section 1.704-1(b)(2)(iv)(i)) of the Company during such Fiscal Year;
PROVIDED, HOWEVER, that, in the case of Section 704(c) Property, depreciation
for each Fiscal Year shall be an amount equal to (I) the basis recovered for
such Fiscal Year under the rules prescribed by Regulation Section 1.704-3(d) if
the remedial method is adopted with respect to such Section 704(c) Property and
(II) in all other cases, (x) the depreciation for Federal income tax purposes
with respect to such Section 704(c) Property for such Fiscal Year multiplied by
(y) a fraction (i) the numerator of which is the fair market value of such
Section 704(c) Property on the date of contribution or revaluation and (ii) the
denominator of which is the basis of such Section 704(c) Property on the date of
contribution or revaluation for Federal income tax purposes; and PROVIDED
FURTHER, HOWEVER, that if the basis of such Section 704(c) Property for Federal
income tax purposes is zero, depreciation for each Fiscal Year shall be computed
under any reasonable method in accordance with Treasury Regulation Section
1.704-1(b)(2)(iv)(G)(3) that is approved by both Members.
6
To the extent an adjustment to the adjusted tax basis of any Partnership asset
pursuant to Code Section 734(b) or Code Section 743(b) is required pursuant to
Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in
determining Capital Accounts as a result of a distribution other than in
complete liquidation of a Member's interest, the amount of such adjustment shall
be treated as an item of gain (if the adjustment increases the basis of the
asset) or loss (if the adjustment decreases the basis of the asset) from the
disposition of the asset and shall be taken into account for purposes of
computing Net Profits or Net Losses.
"Operating Agreement" means the Operating Agreement dated as of the Closing
Date between SanDisk and SENA.
"Operating Committee" means the management committee of the Company
established pursuant to Section 5.01(a) OF the Operating Agreement.
"Operative Documents" means the Operating Agreement, the Master Agreement,
the Amendment to Patent License Agreement, the Articles, the Yokkaichi Foundry
Agreement, the Environmental Indemnity Agreement, the Common R&D and
Participation Agreement, the Product Development Agreement and, when executed,
the DSC Foundry Agreement.
"Parent" means Toshiba and SanDisk and each of them.
"Percentage" means, with respect to SENA, 50.1%, and with respect to
SanDisk, 49.9%; PROVIDED, HOWEVER, if either Member transfers its entire
Membership Interest to any Affiliate in accordance with the Operating Agreement,
its Percentage shall be 0% and such Affiliate transferee shall receive the
entire Percentage of the transferring Member.
"Permitted Liens" means (a) the rights and interests of the Company, either
Member or any Affiliate of any such Person as provided in the Operative
Documents; and (b) Liens for Taxes which are not due and payable or which may
after contest be paid without penalty or which are being contested in good faith
and by appropriate proceedings and so long as such proceedings shall not involve
any substantial risk of the sale, forfeiture or loss of any part of any relevant
asset or title thereto or any interest therein.
"Person" means any individual, firm, company, corporation, limited
liability company, unincorporated association, partnership, trust, joint
venture, Governmental Authority or other entity, and shall include any successor
(by merger or otherwise) of such entity.
"Purchase and Supply Agreement" means that certain Purchase and Supply
Agreement to be entered into in connection with the Master Agreement, by and
among the Company, SENA and SanDisk.
"SanDisk" means SanDisk Corporation, a Delaware corporation.
7
"Seconded Employee" means an individual who was originally an employee of a
Member or any of its Affiliates and who was assigned to the Company or any of
its Subsidiaries by such Member or such Affiliate at the request of such Member
as contemplated by Section 7.07 of the Master Agreement.
"Section 704(c) Property" means any property contributed to the Company
that has a tax basis for Federal income tax purposes on the date of its
contribution that differs from its fair market value on such date and any
Company property that is revalued pursuant to Section 7.01(b) of the Operating
Agreement. For purposes of calculating Net Profits or Net Losses arising from
any Capital Transaction involving Section 704(c) Property, the basis of such
Section 704(c) Property shall be deemed to be its fair market value on the date
of contribution or revaluation less the accumulated depreciation (calculated in
accordance with the provisos to the definition of Net Profits and Net Losses)
arising after that date with respect to such Section 704(c) Property.
"SENA" means Semiconductor North America, Inc., a Delaware corporation.
"Subsidiary" of any Person means any other Person:
(i) more than 50% of whose outstanding shares or securities (representing
the right to vote for the election of directors or other managing authority)
are, or
(ii) which does not have outstanding shares or securities (as may be the
case in a partnership, joint venture or unincorporated association), but more
than 50% of whose ownership interest representing the right to make decisions
(equivalent to those generally reserved for the board of directors of a
corporation) for such other Person is,
now or hereafter owned or controlled, directly or indirectly, by such Person,
but such other Person shall be deemed to be a Subsidiary only so long as such
ownership or control exists; PROVIDED, HOWEVER, that the term Subsidiary as used
in any Operative Document, when used in relation to a Member or any of its
Affiliates, shall not include the Company or any of its Subsidiaries.
"Tax" or "Taxes" means all United States or Japanese Federal, state, local
or other political subdivision and foreign taxes, assessments and other
governmental charges, including (a) taxes based upon or measured by gross
receipts, income, profits, sales, use or occupation and (b) value added, ad
valorem, transfer, franchise, withholding, payroll, employment, excise or
property taxes, together with (c) all interest, penalties and additions imposed
with respect to such amounts and (d) any obligations under any agreements or
arrangements with any other Person with respect to such amounts.
"Toshiba" means Toshiba Corporation, a Japanese corporation.
8
"Transfer" means any transfer, sale, assignment, conveyance, creation
(whether or not voluntary) of any Lien (other than a Permitted Lien), or other
disposal or delivery, including by dividend or distribution, whether made
directly or indirectly, voluntarily or involuntarily, absolutely or
conditionally, or by operation of law or otherwise.
"Unique Activities" means production activities of the Company at the
request of either Member to (i) implement changes in the manufacturing processes
to be employed for Products to be manufactured for such Member (or its
Affiliates) that are not agreed to by the other Member, (ii) commence
manufacturing other Products for the requesting Member (or its Affiliates) that
the other Member does not desire to have manufactured for it and which require a
change in manufacturing processes or in the utilization of the Facility or
production resources, or (iii) implement any other change in its operations in
order to manufacture Products specifically for the requesting Member (or its
Affiliates).
"Yokkaichi" means Toshiba's manufacturing facility located at Yokkaichi,
Japan.
"Yokkaichi Foundry Agreement" means the Foundry Agreement dated as of May
9, 2000 between Toshiba and SanDisk Limited (Japan).
ARTICLE II
RULES OF CONSTRUCTION AND DOCUMENTARY CONVENTIONS
SECTION 2.01 AMENDMENT AND WAIVER. (a) No amendment to or waiver of any
agreement or instrument incorporating these Rules of Construction and
Documentary Conventions shall be effective unless it shall be in writing,
identify with specificity the provisions of the applicable agreement or
instrument that are thereby amended or waived and be signed by each party
thereto. Any failure of a party to comply with any obligation, covenant,
agreement or condition contained in such agreement or instrument may be waived
by the party entitled to the benefits thereof only by a written instrument duly
executed and delivered by the party granting such waiver, but such waiver or
failure to insist upon strict compliance with such obligation, covenant,
agreement or condition shall not operate as a waiver of, or estoppel with
respect to, any subsequent or other failure of compliance.
SECTION 2.02 SEVERABILITY. If any provision of any agreement or instrument
incorporating these Rules of Construction and Documentary Conventions or the
application of any such provision is invalid, illegal or unenforceable in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision of such agreement or instrument (except as may be expressly
provided in such agreement or instrument) or invalidate or render unenforceable
such provision in any other jurisdiction. To the extent permitted by applicable
law, the parties waive any provision of law that renders any provision of such
agreement or instrument invalid, illegal or unenforceable in any respect. The
parties shall, to the extent lawful and practicable, use their reasonable
efforts to enter into arrangements to reinstate the intended benefits, net of
the intended burdens, of any such provision held invalid,
9
illegal or unenforceable. If the intent of the parties for entering into the
Operative Documents, considered as a single transaction, cannot be preserved,
the Operative Documents shall either be renegotiated or terminated.
SECTION 2.03 SURVIVAL. Except as may otherwise be specifically provided in
any agreement or instrument incorporating these Rules of Construction and
Documentary conventions, all covenants, agreements, representations and
warranties of the parties made in or pursuant to such agreement or instrument
shall survive the execution and delivery of such agreement or instrument and the
closing of the transactions contemplated thereby, notwithstanding any
investigation by or on behalf of any party. Further, the provisions set forth in
Article II hereof shall survive and shall apply with respect to any terminated
agreement which incorporated these Rules of Construction and Documentary
Conventions.
SECTION 2.04 ASSIGNMENT. Except as may otherwise be specifically provided
in any agreement or instrument incorporating these Rules of Construction and
Documentary Conventions, a party thereto shall not transfer, or grant or permit
to exist any Lien (except Permitted Liens) on, such agreement or instrument or
any of its rights thereunder (except for any transfer to an Affiliate or in
connection with a merger, consolidation or sale of all or substantially all the
assets or the outstanding securities of such party, which transfer shall not
require any consent of the other parties) without the prior written consent of
each other party thereto (which consent may be withheld in each such other
party's sole discretion), and any such purported transfer or Lien without such
consent shall be void.
SECTION 2.05 REMEDIES; FORCE MAJEURE. In no event will any party to
any agreement or instrument incorporating these Rules of Construction and
Documentary Conventions (except as may be otherwise expressly provided therein)
be liable to another party thereto for special, indirect, punitive or incidental
damages, lost profits, lost savings or any other consequential damages, even if
such party has been advised of the possibility of such damages, resulting from
the breach by it of any of its obligations thereunder or breach by it or any of
its Affiliates of any of their respective obligations under any other Operative
Document or from the use of any confidential or other information.
(a) Except as may otherwise be specifically provided in any agreement or
instrument incorporating these Rules of Construction and Documentary
Conventions, the rights and remedies of the parties under such agreement or
instrument are cumulative and are not exclusive of any rights or remedies which
the parties would otherwise have. Equitable relief, including the remedies of
specific performance and injunction, shall be available with respect to any
actual or attempted breach of such agreement or instrument; PROVIDED, HOWEVER,
in the absence of exigent circumstances,
10
the parties shall refrain from commencing any lawsuit or seeking judicial relief
in connection with such actual or attempted breach that is contemplated to be
addressed by the dispute resolution process set forth in Section 10.03 of the
Master Agreement until the parties have attempted to resolve the subject dispute
by following said dispute resolution process to its conclusion.
(b) If the due date for any amount required to be paid under an Operative
Document incorporating these Rules of Construction and Documentary Conventions
is not a Business Day, such amount shall be payable on the next succeeding
Business Day; provided that if payment cannot be made due to the existence of a
banking crisis or international payment embargo, such amount may be paid within
the following 30 days. If due to the occurrence of an act of God, any party is
prevented from providing training, technical assistance or other similar support
required to be provided to the Company pursuant to any Operative Document
incorporating these Rules of Construction and Documentary Conventions, such
party shall have an additional 30 day period to make alternative arrangements to
provide such support.
SECTION 2.06 PARTIES IN INTEREST; LIMITATION ON RIGHTS OF OTHERS. Any
agreement or instrument incorporating these Rules of Construction and
Documentary Conventions shall be binding upon and inure to the benefit of the
parties thereto and their permitted successors and assigns. Nothing in any such
agreement or instrument, whether express or implied, shall give or be construed
to give any Person (other than the parties thereto and their permitted
successors and assigns) any legal or equitable right, remedy or claim under or
in respect of such agreement or instrument, unless such Person is expressly
stated in such agreement or instrument to be entitled to any such right, remedy
or claim.
SECTION 2.07 TABLE OF CONTENTS; HEADINGS. The Table of Contents and Article
and Section headings to any agreement or instrument incorporating these Rules of
Construction and Documentary Conventions are for convenience of reference only
and shall not affect the construction of or be taken into consideration in
interpreting any such agreement or instrument.
SECTION 2.08 COUNTERPARTS; EFFECTIVENESS. Any agreement or instrument
incorporating these Rules of Construction and Documentary Conventions may be
executed by the parties thereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all of which counterparts shall
together constitute but one and the same contract. Any agreement or instrument
incorporating these Rules of Construction and Documentary Conventions shall not
become effective until one or more counterparts have been executed by each party
thereto and delivered to the other parties thereto.
SECTION 2.09 ENTIRE AGREEMENT. Any agreement or instrument incorporating
these Rules of Construction and Documentary Conventions, together with the other
Operative Documents and the Exhibits, Schedules, Appendices
11
and Attachments thereto, any agreement entered into simultaneously therewith,
the Initial Business Plan constitute the agreement of the parties to the
Operative Documents with respect to the subject matter thereof and supersede all
prior written and oral agreements and understandings with respect to such
subject matter.
SECTION 2.10 CONSTRUCTION. References in any agreement or instrument
incorporating these Rules of Construction and Documentary Conventions to any
gender include references to all genders, and references in any such agreement
or instrument to the singular include references to the plural and vice versa.
Unless the context otherwise requires, the term "party" when used in any such
agreement or instrument means a party to such agreement or instrument.
References in any such agreement or instrument to a party or other Person
include their respective permitted successors and assigns. The words "include",
"includes" and "including", when used in any such agreement or instrument, shall
be deemed to be followed by the phrase "without limitation". Unless the context
otherwise requires, references used in any such agreement or instrument to
Articles, Sections, Exhibits, Schedules, Appendices and Attachments shall be
deemed references to Articles and Sections of, and Exhibits, Schedules,
Appendices and Attachments to, such agreement or instrument. Unless the context
otherwise requires, the words "hereof", "hereby" and "herein" and words of
similar meaning when used in any such agreement or instrument refer to such
agreement or instrument in its entirety and not to any particular Article,
Section or provision of such agreement or instrument. The terms and conditions
of any such agreement or instrument shall be deemed to apply to any Subsidiary
of the Company as though such entity were the Company except where such
application would be manifestly inappropriate. Any reference to an Operative
Document shall include such Operative Document as amended or supplemented from
time to time in accordance with the provisions thereof.
Section 2.11 OFFICIAL LANGUAGE. The official language of any agreement
incorporating these Rules of Construction is the English language only, which
language shall be controlling in all respects, and all versions of any such
agreement in any other language shall not be binding on the parties thereto or
nor shall such other versions be admissible in any legal proceeding, including
arbitration, brought under such agreement. All communications and notices to be
made or given pursuant to any such agreement shall be in the English language.
Section 2.12 GOVERNING LAW. Any agreement incorporating these Rules of
Construction shall be governed and construed as to all matters including
validity, construction and performance by and under the substantive laws of the
State of California.
SECTION 2.13 WAIVER OF JURY TRIAL AND CERTAIN DAMAGES. Each party to any
Operative Document incorporating these Rules of Construction and Documentary
Conventions waives, to the fullest extent permitted by applicable law, (i) any
right it may have to a trial by jury in respect of any action, suit or
proceeding
12
arising out of or relating to any Operative Document and (ii) absent fraud, any
right it may have to receive damages or indemnification from any other party to
any Operative Document in respect of any act, omission or event relating to such
Operative Document or the transactions contemplated by the Operative Documents
based on any theory of liability for any special, indirect, consequential or
punitive damages. Each party to any such agreement or instrument (x) certifies
that no representative, agent or attorney of another party has represented,
expressly or otherwise, that such other party would not, in the event of
litigation, seek to enforce the foregoing waiver and (y) acknowledges that it
has been induced to enter into such agreement or instrument by, among other
things, the mutual waivers and certifications set forth above in this Section
2.12
SECTION 2.14 ARBITRATION. Each party to any agreement or instrument
incorporating these Rules of Construction and Documentary Conventions hereby
agrees to adhere to the dispute resolution procedures described in Section 10.03
of the Master Agreement with respect to any disputes, grievances or actions
arising thereunder.
SECTION 2.15 NOTICES. All notices and other communications to be given to
any party under any agreement or instrument incorporating these Rules of
Construction and Documentary Conventions shall be in writing and any notice
shall be deemed received when delivered by hand, courier or overnight delivery
service, or by facsimile (if confirmed within two Business Days by delivery of a
copy by hand, courier or overnight delivery service), or five days after being
mailed by certified or registered mail, return receipt requested, with
appropriate postage prepaid and shall be directed to the address of such party
specified below (or at such other address as such party shall designate by like
notice):
(a) If to SanDisk:
SanDisk Corporation
000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: President and CEO
13
With a copy to:
SanDisk Corporation
000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Vice President and General Counsel
(b) If to Toshiba:
Toshiba Corporation
Semiconductor Company
1-1 Xxxxxxxx 0-Xxxxx
Xxxxxx-Xx, Xxxxx 000-0000 Xxxxx
Telephone: 000 00 0 0000 0000
Facsimile: 011 81 3 5444 9339
Attention of President
With a copy to:
Toshiba Corporation
Semiconductor Company
Legal Affairs and Contracts Division
1-1 Xxxxxxxx 0-Xxxxx
Xxxxxx-Xx, Xxxxx 000-0000 Xxxxx
Telephone: 000-00-0-0000-0000
Facsimile: 011-81-3-5444-9342
Attention of General Manager
(c) If to the Company:
FlashVision, L.L.C.
0000 Xxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention of: President
14
With a copy to:
SanDisk Corporation
000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: General Manager, NAND Division
And
Toshiba Corporation
Semiconductor Company
Legal Affairs and Contracts Division
1-1 Xxxxxxxx 0-Xxxxx
Xxxxxx-Xx, Xxxxx 000-0000 Xxxxx
Telephone: 000-00-0-0000-0000
Facsimile: 011-81-3-5444-9342
Attention of General Manager
(d) If to SENA:
Semiconductor of North America, Inc.
0000 Xxxxxx Xxx
X.X. Xxx 00000
Xxxxxx, Xxxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention of President
SECTION 2.16 DEFINITIONS. The definitions set forth in Article I of this
Appendix A shall apply to this Article II.
15
