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EXHIBIT 10.15
AMENDMENT NO. 1
TO
SEMICONDUCTOR DEVICE PURCHASE AGREEMENT
This Amendment (the "Amendment") No. 1 to the Semiconductor Device
Component Purchase Agreement dated August 17, 1998, by and between Immersion
Corporation, a California corporation, having its principal place of business at
0000 Xxxxxxx Xxxxx, Xxx Xxxx, Xxxxxxxxxx (hereinafter "Immersion") and Kawasaki
LSI U.S.A. Inc., a California Corporation, having its principal place of
business at 0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000, Xxx Xxxx, Xxxxxxxxxx 00000
(hereinafter "KLSI"), modifies and amends the Semiconductor Device Component
Purchase Agreement (the "Agreement") in certain respects as follows:
1. The parties desire to amend the Agreement to permit KLSI to sell the
"Components" directly to certain designated customers, and therefore Paragraph
2.1.3, entitled "KLSI Sales to Direct Customers" as described below is hereby
added to the Agreement.
2. Paragraph 2.1.3.1, entitled "In General": The following Paragraph
2.1.3.1 is hereby added to the Agreement:
The parties agree that Paragraph 2.1.1 ("Components") of the
Agreement requires that the Components will be sold exclusively to
Immersion. Notwithstanding the foregoing, Immersion may from time to
time desire that KLSI sell certain designated Components ("Specific
Components") directly to certain designated customers ("Direct
Customers"). In such case, Immersion will issue a Direct Customer
Authorization Form substantially in the form attached hereto as
Schedule 1 ("Direct Customer Authorization Form") to KLSI. KLSI
agrees that Immersion may define the Specific Components to include
only certain formats of the Component, such as the .35 CBA format or
the .35 standard cell format. Upon execution by Immersion and KLSI
of each Direct Custom Authorization Form, KLSI may negotiate
directly with such Direct Customer to enter into a component
purchase agreement under terms mutually agreed upon by KLSI and the
Direct Customer. Subject to the limitations described in Section
2.1.3.4 ("Limitations") and Section 2.1.3.7 ("Second Source
Limitation"), KLSI and each Direct Customer will be free to address
lead times, pricing, hexcode deliveries, quality requirements and
other relevant terms as mutually agreed upon by KLSI and such Direct
Customer.
3. Paragraph 2.1.3.2, entitled "Direct Customer Royalty": The following
Paragraph 2.1.3.2 is hereby added to the Agreement:
KLSI agrees to compensate Immersion by means of a royalty which will
be due and owing for each unit of the Specific Components sold to a
Direct Customer. The specific royalty due for sales of Specific
Components to each Direct Customer will be described in the
applicable Direct Customer Authorization Form. KLSI agrees to pay
the royalties due to Immersion for each
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shipment of Specific Components to a Direct Customer within [****]
days of acceptance of the Specific Components by the Direct
Customer.
4. Paragraph 2.1.3.3, entitled "Mitigation Trigger Events": The following
Paragraph 2.1.3.3 is hereby added to the Agreement:
Orders from Direct Customers shall be counted toward
Immersion's orders for purposes of reaching the [****] units per
month.
5. Paragraph 2.1.3.4, entitled "Die Bank and Base Wafer": The following
Paragraph 2.1.3.4 is hereby added to the Agreement:
Immersion's Die Bank System and Base Wafer Maintenance Program
will not be used for Direct Customers.
6. Paragraph 2.1.3.5, entitled "Second Source Limitation": The following
Paragraph 2.1.3.5 is hereby added to the Agreement:
KLSI may use its Second Source to produce Specific Components
for resale by KLSI to Direct Customers but KLSI may not grant Direct
Customers the right to buy directly from the KLSI Second Source.
7. Paragraph 2.2.3 entitled "Terms to be Imposed on the Second Source
Silicon Provider": The following language shall be added to the end of the
existing paragraph 2.2.3:
The parties agree that under certain circumstances where KLSI has
entered into an agreement with a Direct Customer in accordance with
the terms of Section 2.1.3.1 ("In General"), KLSI may be required,
by the Direct Customer, to agree that in the case of a material
breach by KLSI of Quality Requirements or delivery obligations, KLSI
will permit the Direct Customer, as a limited remedy, to enter into
a direct purchase arrangement with KLSI's Second Source for the
Specific Components. Immersion hereby grants KLSI the right to enter
into such an arrangement to permit Direct Customers to purchase the
Specific Components under the circumstances described above, so long
as KLSI imposes an obligation for the Second Source silicon provider
to compensate Immersion by means of the specific royalty applicable
to the Specific Components as described in the applicable Direct
Customer Authorization Form within [****] days of delivery of the
Specific Components by the Second Source to the Direct Customer.
KLSI also agrees to insure that the obligation to pay Immersion on a
timely basis is an obligation enforceable by Immersion as a third
party beneficiary of the Second Source Silicon Provider Agreement.
In addition to the provision set forth in Section 5.3(c) of the
Agreement Draft for the ASIC Design and Development dated October
16, 1997, KLSI agrees to notify Immersion if KLSI works with any
Direct Customer to design, develop and/or knowingly manufacture any
integrated circuit devices for "force feedback" applications that
compete with the Components. For purposes of this Agreement the term
"force
* 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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feedback" shall mean simulation of feel or tactile sensations using
at least one actuator controlled by one or more microprocessors such
that modulation of said actuator creates feel or tactile sensations.
8. Schedule 1 ("Direct Customer Authorization Form") attached hereto is
hereby added to the Agreement as Exhibit F thereto.
9. In the event of inconsistencies between the Agreement and this
Amendment, the terms and conditions of this Amendment shall be controlling.
Unless specifically modified or changed by the terms of this Amendment, all
terms of the Agreement shall remain in effect and shall apply fully as described
and set forth in the Agreement. Capitalized terms used and not defined herein
are used with the meanings set forth in the Agreement.
IMMERSION: KLSI:
IMMERSION CORPORATION: KAWASAKI LSI U.S.A., INC.:
By: /s/ Xxxxx Xxxxxxxxx By: /s/ Xxxxx Xxxxxxxx
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Print Name: Xxxxx Xxxxxxxxx Print Name: Xxxxx Xxxxxxxx
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Title: President Title: Chief Financial Officer
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Date: April 26, 1999 Date: April 27, 1999
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Schedule 1
Direct Customer Authorization Form
This Direct Customer Authorization Form No. 1 contains the special terms
and conditions applicable to the Direct Customer described below and will be
incorporated by reference into the Semiconductor Device Component Purchase
Agreement (the "Agreement") between Immersion and KLSI effective as of 8/17/98
for a term of [****]. This Direct Customer Authorization Form shall be effective
on the date last executed below. All terms used in this Direct Customer
Authorization Form shall retain the same meaning as defined in the Agreement and
such definitions are incorporated herein by reference.
1. Name of Proposed Direct Customer: [****]
2. Royalty to be paid to Immersion: [****]
[****]
3. Name of Specific Component (and [****]
number, if applicable)
IN WITNESS HEREOF, the parties hereto have duly caused this Direct
Customer Authorization Form to be signed by their duly authorized
representatives.
IMMERSION: KLSI:
IMMERSION CORPORATION: KAWASAKI LSI U.S.A., INC.:
By: /s/ Xxxxx Xxxxxxxxx By: /s/ Xxxxx Xxxxxxxx
----------------------------- -----------------------------------
Print Name: Xxxxx Xxxxxxxxx Print Name: Xxxxx Xxxxxxxx
--------------------- ---------------------------
Title: President Title: Chief Financial Officer
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Date: April 26, 1999 Date: April 27, 1999
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* 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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Direct Customer Authorization Form
This Direct Customer Authorization Form No. 1 contains the special terms
and conditions applicable to the Direct Customer described below and will be
incorporated by reference into the Semiconductor Device Component Purchase
Agreement (the "Agreement") between Immersion and KLSI effective as of 6/4/99
for a term of [****]. This Direct Customer Authorization Form shall be effective
on the date last executed below. All terms used in this Direct Customer
Authorization Form shall retain the same meaning as defined in the Agreement and
such definitions are incorporated herein by reference.
1. Name of Proposed Direct Customer: [****]
2. Royalty to be paid to Immersion: [****]
[****]
3. Name of Specific Component (and [****]
number, if applicable)
IN WITNESS HEREOF, the parties hereto have duly caused this Direct
Customer Authorization Form to be signed by their duly authorized
representatives.
IMMERSION: KLSI:
IMMERSION CORPORATION: KAWASAKI LSI U.S.A., INC.:
By: /s/ Xxxxx Xxxxxxxxx By: /s/ Xxxxx Xxxxxxxx
----------------------------- -----------------------------------
Print Name: Xxxxx Xxxxxxxxx Print Name: Xxxxx Xxxxxxxx
--------------------- ---------------------------
Title: President Title: Chief Financial Officer
------------------------- --------------------------------
Date: April 26, 1999 Date: April 27, 1999
------------------------- --------------------------------
* 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.
