Exhibit 10.1(a)

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

THIRD AMENDED & RESTATED FOUNDRY AGREEMENT

THIS THIRD AMENDED & RESTATED FOUNDRY AGREEMENT (the “Agreement”) is made
effective as of February 2, 2010 (the “Effective Date”), by and between Spansion
LLC, having its principal place of business at 915 DeGuigne Drive, Sunnyvale,
California 94088-3453, U.S.A. (“Spansion”), and Spansion Japan Limited, having
its registered place of business at 2, Takaku-Kogyodanchi, Aizuwakamatsu-shi,
Fukushima 965-0060, Japan (“Spansion Japan”).

RECITALS

WHEREAS, Spansion Japan has been engaged in the manufacturing and processing of
integrated circuits and has acquired significant knowledge and manufacturing
experience at its wafer fabrication facilities (fabs) and is willing to provide
foundry services for the production of Flash memory products to Spansion;

WHEREAS, Spansion Japan has provided such foundry services to Spansion since
July 1, 2003;

WHEREAS, the parties entered into the original Foundry Agreement (“Original
Agreement”) effective as of February 23, 2004, to set forth the policies and
procedures actually used by the parties with regard to such foundry services
since July 1, 2003, in order to establish definitely the terms and conditions on
which the foundry services had been and would be rendered;

WHEREAS, the parties amended and restated the Original Agreement to reflect
agreed to arrangements between the parties beginning January 1, 2005 (the “First
Restated Agreement”);

WHEREAS, the parties amended and restated the First Restated Agreement to
reflect agreed to arrangements between the parties beginning March 30, 2007 (the
“Second Restated Agreement”);

WHEREAS, on February 10, 2009, Spansion Japan filed a proceeding under the
Corporate Reorganization Law (Kaisha Kosei Ho) of Japan with the Tokyo District
Court to obtain protection from Spansion Japan’s creditors (the “Spansion Japan
Proceeding”) and successively the Spansion Japan Proceeding was formally
commenced on March 3, 2009, when the Tokyo District Court entered the
commencement order and appointed the incumbent representative director of
Spansion Japan as trustee;

WHEREAS, on March 1, 2009, Spansion filed a voluntary petition for relief under
chapter 11 of Title 11 of the United States Code (the “Chapter 11 Case”) in the
United States Bankruptcy Court for the District of Delaware (the “Bankruptcy
Court”);

WHEREAS, on October 9, 2009, Spansion filed a motion to reject the Second
Restated Agreement in the Chapter 11 Case, and on November 19, 2009, the
Bankruptcy Court entered an order authorizing the rejection of the Second
Restated Agreement as of October 9, 2009; and

 

1

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WHEREAS, the parties have determined to amend and restate the Second Restated
Agreement in connection with and as required by the Settlement Agreement (the
“Settlement Agreement”) dated as of January 8, 2010, between Spansion and
Spansion Japan.

NOW, THEREFORE, in consideration of the promises and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:

 

1. GENERAL PROVISIONS AND DEFINITIONS

This Agreement replaces, restates and supersedes the Second Restated Agreement
in its entirety.

1.1. “Aizu” shall mean Spansion Japan’s manufacturing facilities located in
Aizu-Wakamatsu, Japan, and currently referred to by the parties as JV3 and SP1.

1.2. “Confidential Information” shall mean any and all technical and
non-technical information one party provides the other hereunder that is either
indicated to be proprietary or confidential information of the disclosing party
or which by its nature the receiving party would reasonably deem such
information to be confidential or proprietary, regardless of marking, including
trade secret, know-how and proprietary information, firmware, mask works,
designs, schematics, techniques, software code, technical documentation, plans
or any other information relating to any research project, work in process,
future development, scientific, engineering, manufacturing, marketing or
business plan or financial or personnel matter relating to the disclosing party,
its present or future products, sales, suppliers, customers, employees,
investors, or business, whether in written, oral, graphic or electronic form.

1.3. “Die” shall mean one of the semiconductor devices on a Wafer (defined
below) which is produced by Spansion Japan for Spansion using the Qualified
Process (defined below) following Qualification (defined below) as provided
under this Agreement, as amended from time to time by the mutual consent of the
parties. The Die is to be provided to Spansion by Spansion Japan in the form of
Wafers containing tested die.

1.4. “Engineering Wafers” shall mean those wafers required for testing and
Qualification purposes.

1.5. “Flash” shall mean that type of non-volatile computer memory that is
in-circuit programmable with the use of embedded algorithms and standard system
voltages for programming, reading and erasing.

1.6. “Intellectual Property Rights” shall mean any patent, copyright, trade
name, trademark, trade secret, know-how, mask work, industrial design rights, or
any other intellectual property right or proprietary right whether registered or
unregistered, and whether now known or hereafter recognized in any jurisdiction.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

2

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1.7. “Per Wafer Price” shall mean the prices for the purchase of the Wafers to
be agreed upon by the parties as set forth in Section 5 below.

1.8. “QBP” shall have the meaning specified in Section 4.2 below.

1.9. “Qualification Plan” shall mean the plan and process to be agreed upon by
the parties under which the Qualified Process is brought up at Aizu and the
Wafers are manufactured using the Qualified Process to meet Spansion’s objective
reliability and quality specifications, as may be amended for each Qualified
Process.

1.10. “Qualification” shall mean the determination performed and made by
Spansion that Wafers meet Spansion’s objective reliability/quality
specifications in accordance with the Qualification Plan, as more fully
described in Section 2.7

1.11. “Qualified Process” shall mean the process which uses or is derived from
Spansion’s proprietary wafer process, including sort testing with modifications,
if any, and which is made by Spansion Japan with the agreement of Spansion and
which is brought up at Aizu and approved by Spansion for production of Wafers,
as more fully detailed in Section 2.7.

1.12. “Scrap” shall mean any Wafer and/or Die, in any stage of completion,
without regard to its ability to function, that is not in conformance with the
requirements of this Agreement for Wafers to be sold to Spansion.

1.13. “Settlement Approval Date” shall mean the date on which the Settlement
Agreement is approved by both the Tokyo District Court and the Bankruptcy Court.

1.14. “Spansion Competitor” shall have the meaning set forth in Schedule 1.14.

1.15. “Spansion Technology” shall mean, collectively, the design, manufacturing
information and process know-how, technology, specifications and documentation
provided by Spansion to Spansion Japan from time to time to enable Spansion
Japan’s performance of its obligations to Spansion hereunder.

1.16. “Wafers” shall mean silicon wafers containing Die manufactured by Spansion
Japan using the Qualified Process agreed upon by the parties under Section 2
below.

 

2. PROCESS IMPLEMENTATION

2.1. Spansion Japan will bear all the capital investment required by it (other
than probe cards and reticles for newly introduced products) to produce Flash
memory products under this Agreement, including the investment for future Flash
memory capacity, through the life of this Agreement. The installed capacity
shall be sufficient to produce the required Wafer outs per week to satisfy the
relevant QBP as described in Section 4.2, including Engineering Wafers.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

3

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2.2. Spansion Japan will produce Flash memory products for Spansion utilizing a
Qualified Process to reach the production capacity.

2.3. Spansion shall provide the set of specifications, including but not limited
to the specifications listed below, required with respect to manufacturing the
Wafers at Spansion Japan with necessary modifications made upon mutual agreement
between the parties. Spansion Japan’s original specification may be utilized
when it is approved by Spansion.

 

  •  

Wafer process Specification (Process Flow, PCM Specification)

 

  •  

Mask for Die

 

  •  

WLR/WLB program, if needed

 

  •  

WET test Program / WET test specification

 

  •  

Sort test Program / Sort test specification for the Die/Sort Related Program

 

  •  

Correlation wafer for WET/SORT

 

  •  

Packing specification for Wafers

 

  •  

Purchase Specifications for materials

 

  •  

ECN Procedure

 

  •  

Lot Disposition Procedure

2.4. In case Spansion Japan or Spansion finds that there needs to be any change
or addition to the agreed specifications, such party shall notify the other
party in writing of such change and obtain the other party’s written approval.

2.5. Based on the agreed specifications, Spansion Japan shall establish a
certain manufacturing process at its facilities, fabricate Wafers and/or Die
with such manufacturing process and deliver the Wafers and/or Die to Spansion in
accordance with the Qualification Plan agreed upon between the parties.

2.6. Spansion shall evaluate the Wafers and/or Die provided by Spansion Japan in
accordance with the Qualification Plan. If Spansion determines that the Wafers
and/or Die meet and satisfy its quality and reliability specifications set forth
in such Qualification Plan, Spansion shall notify Spansion Japan of such
determination. Such notice shall serve as the official notification that the
manufacturing process established and the Wafers and/or Die produced by Spansion
Japan are fully qualified by Spansion and Spansion Japan, and such manufacturing
process shall constitute a “Qualified Process.”

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

4

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2.7. If the parties agree to introduce new Wafers and/or Die, Spansion and
Spansion Japan shall agree on the specifications described in Section 2.3 above
for such new Wafers and/or Die. Spansion and Spansion Japan shall further agree
on the Qualification Plan for such new Wafers and/or Die.

 

3. WAFER PRODUCTION

3.1. Upon the successful completion of Qualification, Spansion Japan shall
manufacture Wafers utilizing the Qualified Process for Spansion.

3.2. Spansion Japan shall establish a production capability for Spansion of
producing Wafers in accordance with the schedule to be agreed upon between the
parties.

3.3. Unless otherwise specifically provided herein, Spansion Japan shall, at its
own responsibility and cost, purchase or procure raw or indirect materials or
labor including any masks for wear out or breakage (which may be purchased
through Spansion without any margin for Spansion, at Spansion Japan’s expense)
required by it to manufacture Wafers under this Agreement.

3.4. During the term hereof, Spansion shall provide Spansion Japan with
technical support and assistance with respect to the Spansion Technology
required by Spansion Japan to manufacture Wafers for Spansion as Spansion Japan
may reasonably request from time to time.

3.5. Spansion Japan shall manufacture Wafers only at Aizu, and shall not have
any third party manufacture Wafers without obtaining the prior written consent
of Spansion on a case-by-case basis, unless otherwise agreed by the parties.
Notwithstanding the foregoing, Spansion Japan shall have the right to
subcontract out to third parties a discrete portion of the manufacturing process
for a short term only and only due to Spansion Japan’s lack of capacity, and
only with notice to Spansion in each such case.

3.6. Spansion Japan shall adhere to all current specifications relating to the
manufacture and disposition of product. This includes, but is not limited to,
statistically defined product specific yield and bin trip limits currently in
affect for all products. These limits should be re-evaluated on a quarterly
basis (as defined in the specifications) and should be used to define the lower
yield limits for shipment (mutually agreed upon by both parties). All
specifications related to the current “LTC” and “LDR” systems must also be
maintained. Spansion Japan shall maintain the existing quality system and all
specifications relevant to maintain their ISO/TS16949 certification.

3.7. Spansion Japan shall return Scrap which cannot be reclaimed to Spansion at
Spansion’s request, or otherwise destroy and properly dispose of all Scrap in
order to prevent any unauthorized sale of any Wafers. Spansion Japan shall
maintain customary Scrap procedures, subject to the reasonable approval of
Spansion, which shall include polishing the Wafer to render unreadable, then
selling or recycling, and shall record all products scrapped including lot
history, reason for scrap and Spansion’s approval for scrap. Spansion shall have
the rights to audit the scrap procedures and to witness scrap of Spansion’s
material with reasonable notice.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

5

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4. ORDERING PROCEDURE

4.1. For every Spansion fiscal quarter (a “Quarter”), Spansion Japan shall
provide to Spansion in writing by the 14th day of the previous Quarter the
information listed below which is required by Spansion to make its production
plan for the next two (2) Quarters, in the format and by the date designated by
Spansion.

 

  •  

Weekly Wafer starts capacity

 

  •  

Weekly Wafer outs capacity

 

  •  

Weekly Wafer sort capacity by test platform

 

  •  

Cycle time for Wafer fabrication and Wafer sorting

 

  •  

Line yield

 

  •  

Sort Line yield

 

  •  

Sort test (Die) yield

 

  •  

Weekly operation rate

 

  •  

Risk input start schedule for new Die

With respect to planned new products, for every Quarter, Spansion shall provide
to Spansion Japan in writing by the beginning of the previous Quarter the
information listed below in “Spansion Product Data Warehouse” (SPDW).

 

  •  

Risk input start schedule for new Die

 

  •  

Sort test time commitment

In addition, for strategic planning purposes, for each Quarter, (i) Spansion
Japan shall provide to Spansion in writing by the 14th day of the previous
Quarter, Spansion Japan’s anticipated starts capacity, outs capacity, and sorts
capacity for the next four (4) Quarters and (ii) Spansion shall provide to
Spansion Japan in writing by the 14th day of the previous Quarter, Spansion’s
wafer demand capacity through the earlier of (i) each of the next four
(4) Quarters, and (ii) the anticipated date of termination of this Agreement.

4.2. Spansion shall make, by no later than sixty (60) days before the start of
each Quarter, a production plan for Spansion Japan for such Quarter and the
Quarter immediately following such Quarter, based on the information provided by
Spansion Japan and the demand forecast from Spansion’s customers. This
production plan, described in this Section 4, is the Quarterly Beginning Plan
(“QBP”). Within five (5) business days after Spansion Japan’s receipt of a QBP,
Spansion Japan shall either accept or reject the portion of the QBP for the
first Quarter covered by such QBP. Each QBP shall also specify (i) the monthly
delivery dates for the Wafers specified in such QBP, and (ii) the Target Yield,
as defined in the attached Exhibit B, with respect to such Wafers.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

6

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4.3. Once Spansion has completed the production plan as described in
Section 4.2, Spansion will submit the plan in writing to Spansion Japan. The QBP
shall become the official production plan for Spansion and Spansion Japan for
the immediately following Quarter, and Spansion Japan shall allocate the
production capacity sufficient to fulfill the QBP for such Quarter. QBPs shall
be firm and binding on Spansion for the overall number of Wafers specified
therein. Notwithstanding the foregoing, Spansion may request, on a weekly basis,
reasonable changes to a QBP already accepted by Spansion Japan pursuant to
Section 4.2. Spansion Japan shall not unreasonably withhold its consent to such
requests, provided that (i) Spansion may not request any alterations in the
overall number of Wafers to be produced; and (ii) Spansion may not request any
changes in product mix if production of the relevant Wafers has either already
commenced or is scheduled to commence within three (3) business days after the
applicable QBP update request.

In connection with any change to a QBP involving a request to hold certain lots
or products, Spansion Japan shall in no event be obligated to hold such lots or
products beyond the end of the second (2nd) fiscal month following the month of
its receipt of the request to change the QBP. For the avoidance of doubt, in the
event that Spansion requests such a change to a QBP on January 20th, Spansion
Japan would not have any obligation to hold such lots or products beyond the end
of the fiscal month of March. Within fifteen (15) days of the expiration of such
holding period, Spansion shall pay to Spansion Japan for any Wafers it held for
such period a pro rata portion of the Wafer price based on the number of steps
through which such Wafers had been processed at the time such Wafers were placed
on hold. At Spansion’s option, Spansion may reduce the Minimum Commitment by the
pro rata amount paid by Spansion for such held Wafers.

Notwithstanding anything else contained in this Section 4.3, Spansion commits to
purchase Wafers for each Quarter as shown in the attached Exhibit D (the
“Minimum Commitment”). In addition, Spansion may order in any given QBP
additional Wafers in an amount not to exceed twenty (20) percent of the
applicable Minimum Commitment and Spansion Japan shall allocate the production
capacity sufficient to fulfill such additional orders. Spansion Japan may
determine in its sole discretion whether to accept any orders in excess of such
twenty (20) percent amount. Any orders for Wafers in excess of the Minimum
Commitment for any Quarter shall not be counted towards the total Minimum
Commitment amount.

4.4. Spansion will purchase Wafers from Spansion Japan pursuant to a written
purchase order in the form attached as Exhibit G (each, a “Purchase Order”).
Purchase Orders shall be sent to Spansion Japan by confirmed facsimile,
electronic transmission, or other mutually-agreed means at least sixty (60) days
in advance of the applicable Quarter except that the initial purchase order
shall be sent as promptly as practicable following the Settlement Approval Date
(or such other date as may be agreed between the parties). For the avoidance of
doubt, except as otherwise provided in Section 4.3, Spansion shall purchase all
production Wafers that are ordered by Spansion pursuant to a valid Purchase
Order. All JV3 Wafers purchased by Spansion pursuant to Purchase Orders sent by
Spansion to Spansion Japan from January 9, 2010 through the Effective Date shall
count towards the total Minimum Commitment amount and all Wafer sort services
purchased pursuant to Purchase Orders sent by Spansion to Spansion Japan from
January 9, 2010 through the Effective Date shall count towards the floor revenue
amounts described in Section 6.1 below.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

7

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5. PRICING

Prices will be calculated as set forth in Exhibits B, D, and F attached hereto.
For the avoidance of doubt, the prices set forth in Exhibits B, D, and F
attached hereto shall apply to all Wafers accepted by Spansion after the
Effective Date irrespective of whether such Wafers were ordered prior to or
after the Effective Date.

 

6. WAFER SORT SERVICES

6.1. Spansion shall purchase Wafer sort services from Spansion Japan based on
the hourly rates specified on the attached Exhibit B. Notwithstanding the
foregoing, Spansion agrees to purchase or pay for sufficient Wafer sort services
to achieve an agreed floor revenue to Spansion Japan of not less than [*] per
Quarter in the aggregate for Aizu through the date of the termination of this
Agreement (excluding sort service fees paid for use of the T5335 KTD High Temp
Test); provided, however, that such agreed floor revenue shall be prorated to
[*] for the first fiscal Quarter of 2010 in order to take into account the
number of days that elapse between the commencement of the first fiscal Quarter
of 2010 and the Effective Date. In the event that Spansion Japan sells SP1 sort
services or JV3 sort services, as the case may be, the foregoing floor revenue
shall be deemed to have been comprised of [*] per Quarter in the aggregate for
JV3 and [*] per Quarter in the aggregate for SP1, and Spansion shall no longer
have any obligation to purchase or pay for sufficient Wafer sort services to
achieve such floor revenue for SP1 (in the event of a sale of SP1 sort services)
or JV3 (in the case of a sale of JV3 sort services). Consistent with the
Bailment Agreement dated as of even date between Spansion and Spansion Japan,
Spansion shall have the right to use and distribute probe cards freely among
sort locations so long as it meets the floor revenue requirement described
above. Spansion Japan shall be entitled to use the Spansion probe cards solely
for testing purposes in connection with the Wafer sort services under this
Agreement. Upon termination of the Wafer sort services, promptly upon request,
Spansion Japan will return (at Spansion’s expense) any of Spansion’s probe cards
still in its possession to Spansion. Upon termination of the Wafer sort
services, promptly upon request, Spansion will return (at Spansion Japan’s
expense) any of Spansion Japan’s probe cards still in its possession to Spansion
Japan. For avoidance of doubt, under no circumstances shall Spansion Japan not
be entitled to the floor revenue commitments described above because Spansion
Japan was unable to perform or unable to timely perform Wafer sort services
because probe cards needed by Spansion Japan to perform the Wafer sort services
outlined above were not in its possession through no fault of Spansion Japan.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

8

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Spansion shall provide Spansion Japan with its required loading of the sort
testers on a weekly basis defining the required load by product by tester.
Spansion and Spansion Japan shall meet and confer weekly to discuss and agree
upon such loading of the sort testers. Following such meeting, Spansion Japan
shall load the sort testers in conformity with the agreed upon required loading.
Spansion Japan shall download every Wafer map to the existing system or a
comparable system and shall provide Spansion with reasonable access to such
system in order to access such Wafer maps and other test data. Reconciliation
shall be made on a weekly basis. Spansion Japan shall also provide Spansion on
an as-needed basis, with the capability to log onto the Aizu testers.

6.2. At all times during the term of this Agreement, probe cards owned by
Spansion Japan will remain the sole property of Spansion Japan, and upon
termination of the Wafer sort services or the sale of JV3 or SP1, as applicable,
upon request, Spansion will return any of Spansion Japan’s probe cards still in
its possession to Spansion Japan. At all times during the term of this
Agreement, probe cards owned by Spansion will remain the sole property of
Spansion, including all Intellectual Property Rights therein.

 

7. PAYMENT FOR WAFERS AND WAFER SORT SERVICES

7.1. Spansion Japan will invoice Spansion on a Wafer out basis for all products
fabricated on behalf of Spansion hereunder at the Wafer evaluation stage. Title
and all risk of loss or damage to such products shall transfer from Spansion
Japan to Spansion immediately after such Wafers have passed Wafer evaluation
stage. The terms of the delivery and responsibilities for costs and insurance
(but not the terms of transfer of title and risk of loss or damage, which is
provided in the preceding sentence) relating to all products covered by this
Agreement and all FSET and FAB25 Wafers sorted in Aizu shall be as follows,
unless otherwise agreed by the parties: (i) FCA (Incoterms 2000) Narita Airport
using a freight forwarder designated by Spansion, (ii) Spansion Japan shall pay
for freight and insurance up to Narita Airport and Spansion shall be responsible
for all freight and insurance beyond that point and (iii) all products will be
deemed irrevocably accepted upon delivery. With regard to products subject to
sort services, Spansion Japan shall serve as bailee of such products (with
Spansion maintaining title and risk of loss or damage), with an obligation to
exercise commercially reasonable care to safeguard such products from the point
at which they pass the Wafer evaluation stage (for those products fabricated on
behalf of Spansion hereunder) or the point at which they are delivered unloaded
to SP1 or JV3, as applicable (for those products provided by Spansion or a third
party for sorting) until the point of their delivery to Spansion in accordance
with this Section 7.1.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

9

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7.2. Payment from Spansion to Spansion Japan shall be made in Japanese Yen
through wire transfer, or other means agreed upon by the parties. Spansion
agrees to pay Spansion Japan for Wafer purchases within five (5) Japanese
business banking days after the 15th day of the second month following the month
of the completion of the fabrication of the Wafers. Upon any discrepancy between
the invoiced quantity and the actual quantity that Spansion accepts, Spansion
shall inform Spansion Japan of the discrepancy in a timely manner, and Spansion
and Spansion Japan shall adjust such amount immediately after receipt of such
notice.

Spansion agrees to pay Spansion Japan for Wafer sort services within five
(5) Japanese business banking days after the 15th day of the second month
following the month Spansion Japan performed such Wafer sort services. Wafer
sort services shall be invoiced by Spansion Japan on a monthly basis.

7.3. Unless otherwise explicitly stated, the prices specified in this Agreement
are exclusive of any sales, use, excise, consumption or similar taxes, and of
any export and import duties, which may be levied upon or collectible by
Spansion Japan as a result of the sale or shipment of the products to Spansion
or its customers. Spansion agrees to pay and otherwise be fully responsible for
any such taxes and duties, unless in lieu thereof Spansion provides Spansion
Japan with an exemption certificate acceptable to the relevant governmental
authorities. Spansion Japan shall have the right, but shall not be obligated, to
pay any such taxes or duties directly, in which event Spansion shall immediately
reimburse Spansion Japan in the amount thereof upon presentation by Spansion
Japan of evidence of payment.

7.4. On a weekly basis, Spansion Japan shall deliver to Spansion a report of
(a) Wafer shipments listing product, lot identification, ship date, source fab,
Wafer quantity and Die quantity and (b) sort hours used by product, tester type,
QBP test time, actual test time and actual Die yield.

 

8. LIMITED WARRANTY; WARRANTY DISCLAIMER

8.1. Spansion Japan warrants that Wafers and/or Die delivered hereunder shall
meet the applicable specifications which are agreed upon by Spansion and shall
be free from defects in material and workmanship under normal use and service
for a period of twelve (12) months from the date of shipment from Spansion
Japan. If, during such twelve (12) month period, Spansion notifies Spansion
Japan of any defect in Wafers and/or Die subject to the foregoing warranty,
Spansion Japan shall either replace such defective Wafers and/or Die or credit
their purchase price to Spansion, at Spansion’s option. In addition, if, during
the eighteen (18) month period following Spansion’s receipt of Wafers and/or Die
hereunder, Spansion notifies Spansion Japan of any defect in Wafers and/or Die,
Spansion Japan will reasonably assist Spansion in connection with Spansion’s
compliance with and fulfillment of its warranty policies. Spansion Japan further
warrants that its performance of services and use of Spansion Japan technology,
methods and processes in connection with its performance of its obligations
hereunder do not violate any third party Intellectual Property Rights.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

10

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8.2. EXCEPT AS EXPRESSLY PROVIDED IN SECTION 8.1, TO THE MAXIMUM EXTENT
PERMITTED BY APPLICABLE LAW, SPANSION JAPAN EXPRESSLY DISCLAIMS ALL WARRANTIES
AND CONDITIONS REGARDING THE PRODUCTS PROVIDED HEREUNDER, WHETHER EXPRESS,
IMPLIED OR STATUTORY, AND INCLUDING BUT NOT LIMITED TO ALL WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE AND NON-INFRINGEMENT OF
THIRD PARTY RIGHTS.

8.3. Spansion Japan grants no warranties to Spansion’s customers hereunder.
Unless otherwise agreed by the parties, Spansion will not pass through to its
end users or any third party any warranties or representations made by Spansion
Japan hereunder and will expressly indicate to its customers that they must look
solely to Spansion in connection with any problems, warranty claims or other
matters concerning the products.

 

9. RECORDS; AUDIT; PARTIES’ ACTIVITIES

9.1. Spansion Japan will keep complete and accurate records pertaining to
process and manufacturing relevant for products sold to Spansion hereunder.
Spansion Japan will maintain such records for at least a five (5) year period
following the year in which such sales were made hereunder.

9.2. Spansion may, with Spansion Japan’s prior consent, which shall not be
unreasonably withheld, and with at least fifteen (15) days’ prior notice to
Spansion Japan, send its employees (who may be accompanied by designated
customers) to visit Spansion Japan’s production facilities to inspect
fabrication of products and conduct other activities contemplated by this
Agreement. Such visits shall be conducted during Spansion Japan’s normal working
hours. While visiting in Spansion Japan’s facilities, Spansion shall at all
times fully comply with Spansion Japan’s plant rules and regulations as well as
all reasonable instructions that may be issued by Spansion Japan’s employees or
personnel accompanying such employees or customers. Spansion shall indemnify and
hold harmless Spansion Japan and its employees from and against any and all
direct losses or damages without limitation to any of Spansion Japan’s property
or loss of personal health or life, caused by Spansion’s employees or customers
during any such visit. Spansion may assign Spansion employees to work at each
facility manufacturing or sorting Wafers to be purchased by Spansion pursuant to
this Agreement on an as needed or other mutually agreed basis. Spansion Japan
will grant these employees reasonable access to secured office space, conference
rooms, food and break facilities, employee parking facilities and appropriate
sections of the factory and support facilities including clean room where such
Wafers are manufactured, sorted or placed, in each case on an as-needed basis.
Spansion Japan will allow such employees to be full and active participants on
problem solving teams with respect to the manufacturing or sorting of Wafers to
be purchased by Spansion pursuant to this Agreement. Such Spansion employees
shall abide by the policies and regulations of Spansion Japan, and Spansion
shall, at Spansion Japan’s reasonable request, replace any employee who fails to
do so.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

11

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9.3. Spansion Japan agrees to participate in regular quality system reviews for
all Wafers to be produced or sorted on behalf Spansion pursuant to this
Agreement.

9.4. The parties will plan and schedule business reviews at least quarterly for
products produced hereunder. The review will focus on current and forecasted
business activities, feedback on performance and factory metrics, key
improvement programs and activities focused on enabling the relationship between
the parties and will review the status of open issues and action items. Such
reviews are considered to be a key activity for the parties.

 

10. CONFIDENTIAL INFORMATION

10.1. Both parties will maintain in confidence all Confidential Information
disclosed by the other party (the “Disclosing Party”). A receiving party
hereunder (the “Receiving Party”) will not use, disclose or grant use of such
Confidential Information except as expressly authorized by this Agreement. To
the extent that disclosure to a third party is authorized by this Agreement, a
Receiving Party will obtain prior agreement from such third party to whom
disclosure is to be made to hold in confidence and not make use of such
information for any purpose other than those permitted by this Agreement. A
Receiving Party will use at least the same standard of care as it uses to
protect its own information of comparable importance to ensure that its
employees, agents and/or consultants do not disclose or make any unauthorized
use of such Confidential Information. The Receiving Party will promptly notify
the Disclosing Party upon discovery of any unauthorized use or disclosure of
such Confidential Information. The obligations set forth in this Section 10
shall survive for five (5) years after any termination or expiration of this
Agreement. To the extent that either party’s Confidential Information embodies
or discloses confidential information of third parties, the obligations with
respect to such information shall be perpetual and nothing herein shall be
construed as superseding the terms and conditions of any confidentiality
obligations agreed to by either party and any third party or requiring either
party to conform any third-party agreement to the terms and conditions of this
Agreement.

10.2. The obligations of confidentiality contained in Section 10.1 will not
apply to the extent that such Confidential Information: (a) was already known to
the Receiving Party, other than under an obligation of confidentiality, at the
time of disclosure by the Disclosing Party; (b) was generally available to the
public or otherwise part of the public domain at the time of its disclosure to
the Receiving Party; (c) became generally available to the public or otherwise
part of the public domain after its disclosure and other than through any act or
omission of the Receiving Party in breach of this Agreement; (d) was disclosed
to the Receiving Party, other than under an obligation of confidentiality, by a
third party who had no obligation to the other party not to disclose such
information to others; (e) was developed independently by the Receiving Party
without any use of Confidential Information; or (f) is required to be disclosed
by applicable law (provided that, in the context of disclosure required by law
in legal proceedings, the Receiving Party will promptly provide written notice
to and afford the Disclosing Party a reasonable opportunity to seek a protective
order or to otherwise minimize the scope of disclosure required by law).

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

12

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11. INTELLECTUAL PROPERTY RIGHTS

11.1. Subject to the terms and conditions of this Agreement, Spansion grants
Spansion Japan a non-exclusive, non-transferable(except to an assignee of
Spansion Japan to the extent permitted under Section 15.3), royalty-free (except
as provided in the Intellectual Property License Agreement between the parties
dated the date hereof (the “Intellectual Property License Agreement”), license,
without the right to sublicense (except to subcontractors of Spansion Japan’s
manufacturing of the Wafers engaged as permitted under Section 3.5, provided
that such sublicense shall be strictly limited to the terms required for the
performance of such subcontracted services), to use the Spansion Technology and
Qualified Process during the term of this Agreement solely for purposes of
making and testing Die and Wafers for sale to Spansion as required under this
Agreement.

11.2. Spansion Japan acknowledges that any and all Intellectual Property Rights
in or relating to the Spansion Technology, Wafers, Die, Qualified Process and
the results of any Wafer sort services (collectively, “Spansion IP”) are and
shall remain the property of Spansion or Spansion’s suppliers, and nothing in
this Agreement shall be deemed a transfer of any ownership rights in the
Spansion IP to Spansion Japan. Except as expressly provided in the Intellectual
Property License Agreement, Spansion owns and shall own all Intellectual
Property Rights in or relating to any Derivatives of or arising from the
Spansion IP. Except to the extent necessary to defend against third party
actions against Spansion Japan arising from Spansion Japan’s use of the Spansion
IP in accordance with this Agreement and with Spansion’s written consent (such
consent not to be unreasonably withheld), Spansion Japan agrees that it will not
reverse engineer any Spansion IP it receives and will not distribute, sell,
transfer or disclose any Spansion IP to any third party. All other rights are
reserved by Spansion. For purposes of this Agreement, “Derivatives” means
derivatives of the Spansion IP, which term shall include: (i) for copyrightable
or copyrighted material, any translation, abridgement, revision or other form in
which an existing work may be recast, transformed or adapted; (ii) for work
protected by registered mask right, any translation, abridgement, revision or
other form in which an existing work may be recast, transformed or adapted;
(iii) for patentable or patented material, any improvement (except as otherwise
provided in the Intellectual Property License Agreement); and (iv) for material
protected by trade secret, any new material derived from or employing such
existing trade secret.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

13

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11.3. Spansion shall indemnify and hold harmless Spansion Japan from and against
any and all losses, liabilities or damages (including reasonable fees and
expense of legal counsel) (collectively, “Losses”) arising from Spansion Japan’s
use of the Spansion IP in accordance with this Agreement in connection with
Spansion Japan’s performance of its obligations hereunder.

11.4. Spansion Japan shall promptly provide to Spansion written notice of its
request for indemnification hereunder. The parties agree to discuss in good
faith how to best handle the issues that have arisen or which may arise in the
intellectual property infringement cases commenced by Samsung against Spansion
Japan in the United States and Japan.

 

12. TERM AND TERMINATION

12.1. This Agreement shall continue in full force and effect until the earlier
to occur of (i) termination by mutual written agreement of the parties, (ii) the
date upon which Spansion has satisfied the Minimum Commitment to purchase
Wafers, the date on which Spansion Japan sells JV3 to a Spansion Competitor, and
(iv) the termination of this Agreement pursuant to Section 14.

12.2. Notwithstanding any termination of this Agreement, the provisions of
Sections 6., 7, 8, 9 (for a period of five (5) years commencing on such
termination), 10, 11.2, 12.2, 12.3, 13 and 15 shall survive any termination of
this Agreement, provided that, in the case of Section 6, (i) the obligation of
Spansion Japan to provide sort services at SP1 in Aizu shall automatically
terminate upon a sale of the sorting services at SP1 (provided that Spansion
receives sixty (60) days prior written notice of such termination) and
(ii) Spansion’s commitment to purchase Wafers and/or Wafer sort services from
JV3 in Aizu shall automatically terminate in the case of a sale of JV3 to a
Spansion Competitor (but shall continue in the event JV3 is not sold to a
Spansion Competitor). For clarity, upon any termination of this Agreement, the
licenses granted by Spansion to Spansion Japan herein shall terminate and
(except as provided in the Intellectual Property License Agreement) Spansion
Japan shall immediately cease to use all Spansion IP, Derivatives and Spansion
Confidential Information.

12.3. Spansion agrees that Spansion Japan shall have a good faith right of first
offer for 170nm, 130nm and 110nm Wafer demand in excess of Fab 25 capacity for a
term of at least two and one-half (2.5) years beginning in the third
(3rd) Quarter of 2011. In addition, following termination of this Agreement,
Spansion and Spansion Japan will discuss in good faith additional arrangements
for the shipment of Wafers by Spansion Japan to Spansion in light of market
demand.

 

13. LIQUIDATED DAMAGES; LIMITATION OF LIABILITY

13.1. In the event that Spansion Japan fails in a material way (excluding
failures due to manufacturing or other problems not within the control of
Spansion Japan) either to deliver Wafers or perform Wafer sort services on a
timely basis or which do not meet acceptable minimum quality specifications, and
it is determined, pursuant to the dispute resolution procedures set forth in
Section 14 below or otherwise, that such failure was within Spansion Japan’s
control, then for any such failure, (a) Spansion shall be entitled to refuse
delivery and not to pay for untimely, undelivered or unacceptable quality Wafers
or Wafer sort services and the Minimum Commitment with respect to the amount of
any untimely, undelivered or unacceptable quality Wafers and/or Wafer sort
services shall be deemed extended by one Quarter for each such failure regarding
such Wafers and/or Wafer sort services and (b) Spansion Japan shall pay to
Spansion (x) in the case of untimely, undelivered or unacceptable quality
Wafers, [*] which is untimely, undelivered or of unacceptable quality and (y) in
the case of untimely, unperformed or unacceptable quality Wafer sort services,
fifty (50) percent of the applicable sort cost per hour based on capacity not
timely provided. With respect to any payments required by Spansion Japan under
the prior sentence, Spansion shall be entitled to offset such amounts against
any payments due to Spansion Japan under this Agreement.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

14

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With respect to any payments required by Spansion Japan under the prior
sentence, (i) Spansion shall be entitled to offset such amounts against any
payments due to Spansion Japan under the Settlement Agreement , and (ii) such
payments shall be Spansion’s sole and exclusive remedy for any claim arising
under this Section 13, other than for fraud and other causes of action that are
not waivable under applicable law, and provided that this provision shall not
prevent Spansion from seeking injunctive relief or other equitable remedies.

13.2. EXCEPT WITH RESPECT TO A BREACH BY EITHER PARTY OF SECTION 10 OR 11, IN NO
EVENT WILL EITHER PARTY BE LIABLE, UNDER ANY THEORY OF LIABILITY, WHETHER IN AN
ACTION BASED ON A CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, HOWEVER
ARISING, FOR INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND
UNDER THIS AGREEMENT. THIS LIMITATION SHALL APPLY NOTWITHSTANDING ANY FAILURE OF
ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.

 

14. EVENTS OF DEFAULT

A party hereto shall be in default under this Agreement upon the occurrence of
any of the following (each an “Event of Default,” and collectively, the “Events
of Default”):

(i) Such party fails to pay within ten (10) days after its due date, any amounts
due under this Agreement;

(ii) Such party ceases to do business as a going concern;

(iii) A receiver is appointed for all or any part of the property of such party
or such party makes any assignment for the benefit of its creditors;

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

15

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(iv) In the case of Spansion, Spansion shall be in default in the event that the
Chapter 11 Case is converted to chapter 7;

(v) In the case of Spansion Japan, Spansion Japan shall be in default in the
event that it liquidates, dissolves, or otherwise winds up its operations; and

(vi) Such party breaches any of its material obligations under this Agreement
(other than those covered in Section 14(i)-14(iv) above).

Upon the occurrence of an Event of Default specified in clauses (i) through
above, the party not in default shall have the right upon written notice to the
party in default, to immediately terminate this Agreement.

Upon the occurrence of an Event of Default specified in clause (vi) above, the
party not in default shall provide written notice to the party in default (a
“Default Notice”) of such Event of Default. Within five (5) days of the delivery
of the Default Notice, representatives of the parties shall meet and confer to
negotiate in good faith to cure such Event of Default or reach such other
agreement acceptable to both parties. In the event that such meetings do not
cure the Event of Default within fifteen (15) days of the Default Notice, senior
officers of each party shall meet and confer to negotiate in good faith to cure
such Event of Default or reach such other agreement acceptable to both parties.
In the event that such meetings do not cure the Event of Default or no
acceptable agreement is reached within thirty (30) days of the Default Notice,
the parties shall submit any remaining disputes to an independent, third-party
mediator acceptable to both parties. In the event that no agreement is reached
by the parties as a result of such mediation within thirty (30) days of the
commencement of such mediation, the party not in default shall have the right,
upon written notice to the party in default, to immediately terminate this
Agreement.

 

15. GENERAL

15.1. No party shall be liable for failure to perform, in whole or in material
part, its obligations under this Agreement if such failure is caused by an event
or condition not existing as of the Effective Date and not reasonably within the
control of the affected party, including, without limitation, by fire, flood,
typhoon, earthquake, explosion, strikes, labor troubles or other industrial
disturbances, unavoidable accidents, war (declared or undeclared), acts of
terrorism, sabotage, embargoes, blockage, acts of governmental authorities,
riots, insurrections, or any other cause beyond the control of the parties;
provided, that the affected party promptly notifies the other party of the
occurrence of the event of force majeure set forth above and takes all
reasonable steps necessary to resume performance of its obligations so
interfered with.

15.2. It is agreed and understood that neither party is the agent,
representative or partner of the other party and neither party has any authority
or power to bind or contract in the name of or create any liability against the
other party in any way or for any purpose pursuant to this Agreement. It is
understood that Spansion Japan is an independent contractor. Each party
expressly reserves the right to enter into other similar agreements with other
parties on the same or on different terms.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

16

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15.3. This Agreement shall not be assigned by Spansion Japan whether voluntarily
or involuntarily or by operation of law, in whole or in part, to any third party
without the prior written consent of Spansion, provided that Spansion Japan may
assign its rights and obligations under this Agreement to any purchaser or
transferee of JV3 at Aizu so long as such purchaser or transferee is not a
Spansion Competitor. In the event of a permitted assignment under this
Section 15.3, the assigning party will have no further obligations arising after
the date of the assignment with respect to this Agreement, provided that the
assignee agrees in writing to assume and be bound by the terms, conditions and
obligations of such party hereunder. Any purported assignment not in compliance
with this Section 15.3 shall be null and void from the beginning.

15.4. Failure or neglect by either party to enforce at any time any of the
provisions hereof shall not be construed nor shall be deemed to be a waiver of
such party’s rights hereunder nor in any way affect the validity of the whole or
any part of this Agreement nor prejudice such party’s rights to take subsequent
action.

15.5. All notices required or permitted to be given hereunder shall be in
writing by first class certified or registered airmail, postage prepaid, if
confirmed or acknowledged, to the addresses specified below or to such other
address as may be specified in writing by the addressed party to the other party
in accordance with this Section 15:

if to Spansion:

Attn: Legal Department

915 DeGuigne Drive

Sunnyvale, California 94088-3453, U.S.A.

if to Spansion Japan:

Attn: Trustee

2 Takaku-Kogyodanchi

Aizuwakamatsu-shi, Fukushima, 965-0060, Japan

Each such notice or other communication shall for all purposes be treated as
effective or as having been given as follows: (i) if delivered in person, when
delivered; (ii) if sent by airmail, at the earlier of its receipt or at 5 p.m.,
local time of the recipient, on the seventh day after deposit in a regularly
maintained receptacle for the disposition of mail or airmail, as the case may
be; and (iii) if sent by recognized courier service, on the date shown in the
written confirmation of delivery issued by such delivery service. Either party
may change the address and/or addressee(s) to whom notice must be given by
giving appropriate written notice at least fourteen (14) days prior to the date
the change becomes effective.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

17

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15.6. In the event that any clause, sub-clause or other provision contained in
this Agreement shall be determined by any competent authority to be invalid,
unlawful or unenforceable to any extent, such clause, sub-clause or other
provision shall to that extent be severed from the remaining clauses and
provisions, or the remaining part of the clause in question, which shall
continue to be valid and enforceable to the fullest extent permitted by law.

15.7. The headings to the clauses, sub-clauses and parts of this Agreement are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement. Any ambiguity in this
Agreement shall be interpreted equitably without regard to which party drafted
the Agreement or any provision thereof. The terms “this Agreement,” “hereof,”
“hereunder,” and any similar expressions refer to this Agreement and not to any
particular Section or other portion hereof. The parties hereto agree that any
rule of construction to the effect that ambiguities are to be resolved against
the drafting party will not be applied in the construction or interpretation of
this Agreement. As used in this Agreement, the words “include” and “including,”
and variations thereof, will be deemed to be followed by the words “without
limitation” and “discretion” means sole discretion. The official text of this
Agreement shall be in the English language, and any interpretation or
construction of this Agreement shall be based solely on the English language
text.

15.8. The rights and obligations of the parties under this Agreement shall not
be governed by the provisions of the 1980 United Nations Convention on Contracts
for the International Sale of Goods or the United Nations Convention on the
Limitation Period in the International Sale of Goods, as amended; rather, these
rights and obligations shall be governed in all respects by the laws of the
State of California exclusively, as such laws apply to contracts between
California residents performed entirely within California.

15.9. In performing its duties under this Agreement, each party hereto shall at
all times comply with all applicable international, federal, state and local
laws and shall not engage in any illegal or unethical practices, including
without limitation the Foreign Corrupt Practices Act of 1977 and any
anti-boycott laws, as amended, and any implementing regulations.

15.10. Spansion and Spansion Japan shall use their best efforts to resolve by
mutual agreement any disputes, controversies, or differences which may arise
from, under, out of, or in connection with this Agreement.

15.11. This Agreement shall become effective as of the Effective Date, subject
to (i) approval by the Tokyo District Court in connection with the Spansion
Japan Proceeding, and (ii) approval of the Bankruptcy Court having jurisdiction
over the Chapter 11 Case.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

18

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15.12. This Agreement supersedes any arrangements, understandings, promises or
agreements as to the subject matter of this Agreement made or existing between
the parties prior to the latest date on which this Agreement is executed by
either party. This Agreement constitutes the entire understanding between the
parties as to the subject matter of this Agreement. Except as otherwise provided
herein, no addition, amendment to or modification of this Agreement shall be
effective unless it is in writing and signed by and on behalf of both parties.
It is acknowledged that the terms of this Agreement have been negotiated between
the parties and that each party was represented by separate counsel.
Notwithstanding the foregoing, nothing contained in this Agreement shall
constitute a waiver, release of, or amendment or other modification to, any
other agreement between the parties relating to a subject other than the subject
matter of this Agreement.

15.13. Nothing contained in this Agreement shall be deemed to prohibit Spansion
Japan from selling Aizu, provided that Spansion Japan provide Spansion with at
least sixty (60) days written notice of such sale.

15.14. Except as otherwise expressly provided herein, in no event shall the
terms of this Agreement be deemed to apply to any products produced, whether
wholly or partially processed, by Spansion Japan prior to January 9, 2010.

15.15. Exhibits.

Exhibit A: [Intentionally Omitted]

Exhibit B: Quarterly Pricing

Exhibit C: [Intentionally Omitted]

Exhibit D: Q110 through Q211 Minimum Commitment

Exhibit E: [Intentionally Omitted]

Exhibit F: R&D Wafers

Exhibit G: Purchase Order

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

19

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
signed and executed.

 

SPANSION JAPAN LIMITED    SPANSION LLC

/s/ Masao Taguchi

  

 

Authorized Signature    Authorized Signature

Masao Taguchi

  

 

Name    Name

Trustee

  

 

Title    Title

February 2, 2010

  

 

Date    Date

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

[Signature Page to Foundry Agreement]

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
signed and executed.

 

SPANSION JAPAN LIMITED   SPANSION LLC

 

 

/s/ Randy W. Furr

Authorized Signature   Authorized Signature

 

 

Randy W. Furr

Name   Name

 

 

EVP & CFO

Title   Title

 

 

2 Feb 2010

Date   Date

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

[Signature Page to Foundry Agreement]

--------------------------------------------------------------------------------

Exhibit A:

[Intentionally Omitted]

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

20

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Exhibit B: Quarterly Pricing

1. Per Wafer Price (for finished unsorted Wafers from JV3 during an applicable
Quarter)

Q110 through Q211:

 

  •  

[*]

2. Sort Service Fee Calculation

 

  •  

[*]

 

  •  

[*]

 

  •  

[*]

 

  •  

[*]

3. Minimum Tester Availability

The number of testers and minimum availability shall be as follows for the
following testers:

 

Tester

  JV3   SP1   Total # of
Testers   Minimum
Availability [*]   [*]   [*]   [*]   [*] [*]   [*]   [*]   [*]   [*] [*]   [*]  
[*]   [*]   [*] [*]   [*]   [*]   [*]   [*] [*]   [*]   [*]   [*]   [*]

4. Yield Adjustment

Definitions

1) “Minimum Yield” means, with respect to a particular sorted Wafer, the minimum
acceptable Yield for such sorted Wafer as set forth below.

2) “Target Yield” means, with respect to a particular sorted Wafer, the Target
Yield for such sorted Wafer as set forth in the applicable QBP.

3) “Yield” means the percentage represented by net Die per Wafer divided by
gross Die per Wafer.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

21

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Summary

The parties agree on the Target Yield as specified in the applicable QBP and the
below Minimum Yield for the Wafers. Compliance with the Target Yield standards
is a performance obligation of Spansion Japan under this Agreement. Without
limiting the foregoing, Spansion shall have the right to reject any individual
Wafer or its entire lot which do not meet the Minimum Yield.

Spansion Japan shall neither ship nor bill Spansion for any Wafer that, to
Spansion Japan’s knowledge, fails to meet the Minimum Yield applicable thereto
unless specifically instructed in writing by Spansion to do so. Spansion Japan
shall notify Spansion at the earliest possible time of any Wafer that is below
the Minimum Yield or otherwise fails to meet the applicable quality standards.
Spansion Japan must notify Spansion in advance of shipment of any Wafers that do
not comply with the requirements of this Exhibit or Agreement.

If Spansion Japan scraps Wafers ordered by Spansion pursuant to the Q110 through
Q211 Minimum Commitment or a subsequent QBP due to Spansion’s change to a
particular mask set or at Spansion’s direction, Spansion shall pay to Spansion
Japan a pro rata portion of the Wafer price based on the number of steps through
which such Wafers had been processed at the time such Wafers were scrapped. For
clarification purposes, such pro rata payment shall apply only to Wafers that
Spansion committed to purchase pursuant to the Q110 through Q211 Minimum
Commitment or a subsequent QBP.

Target Yield

As specified in the applicable QBP.

Minimum Yield

 

  •  

[*]

 

  •  

[*]

Contingency Cases

If the actual quarter average Yield for a particular device falls below the
Target Yield as defined in a particular QBP by [*] within any given Quarter, the
price per Wafer shall be adjusted pro rata as follows: Spansion shall pay
Spansion Japan the actual Yield divided by the Target Yield times the base Wafer
price.

If the actual quarter average Yield for a particular device falls above the
Target Yield as defined in a particular QBP by [*] within any given Quarter, the
price per Wafer shall be adjusted pro rata as follows: Spansion shall pay
Spansion Japan the actual Yield divided by the Target Yield times the base Wafer
price.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

22

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Exhibit C:

[Intentionally Omitted]

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

23

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Exhibit D: Q110 through Q211 Minimum Commitment

Spansion agrees to purchase from Spansion Japan as the Q110 through Q211 Minimum
Commitment the following volume of JV3 unsorted Wafers of the following
technologies: 110 nm, 130 nm, and 170 nm, at the pricing agreed on by the
parties in Exhibit B:

 

Q110

 

Q210

 

Q310

 

Q410

 

Q111

 

Q211

[*]

  [*]   [*]   [*]   [*]   [*]

Spansion agrees to pay Spansion Japan for Wafer sort services as agreed by the
parties in Exhibit B.

If Spansion Japan scraps Wafers ordered by Spansion pursuant to the Q110 through
Q211 Minimum Commitment or a subsequent QBP due to Spansion’s change to a
particular mask set or at Spansion’s direction, Spansion shall pay to Spansion
Japan a pro rata portion of the Wafer price based on the number of steps through
which such Wafers had been processed at the time such Wafers were scrapped. For
clarification purposes, such pro rata payment shall apply only to Wafers that
Spansion committed to purchase pursuant to the Q110 through Q211 Minimum
Commitment or a subsequent QBP. At Spansion’s option, Spansion may reduce the
Q110 through Q211 Minimum Commitment by the pro rata amount paid by Spansion for
such scrapped Wafers.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

24

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Exhibit E:

[Intentionally Omitted]

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

25

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Exhibit F: R&D Wafers

Spansion may purchase Wafers for products not yet qualified for commercial
production (“R&D Wafers”) from Spansion Japan, and Spansion Japan agrees to
provide such R&D Wafers at the following price: the Wafer pricing agreed on by
the parties in Exhibit B plus ten (10) percent.

Spansion may also purchase partially processed R&D Wafers from Spansion Japan,
and Spansion Japan agrees to provide such partially processed R&D Wafers at the
following price: a pro rata portion of the Wafer pricing agreed on by the
parties in Exhibit B plus ten (10) percent.

If Spansion Japan scraps R&D Wafers ordered by Spansion pursuant to a valid
Spansion purchase order after the Effective Date due to Spansion’s change in a
particular mask set or at Spansion’s instruction, Spansion shall pay to Spansion
Japan a pro rata portion of the R&D Wafer price based on the number of steps
pursuant to which such R&D Wafers had been processed at the time such R&D Wafers
were scrapped. For clarification purposes, such pro rata payment shall apply
only to R&D Wafers that Spansion committed to purchase pursuant to a valid
Spansion purchase order.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

26

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Exhibit G: Purchase Order

 

LOGO [g66174g74c98.jpg]    Spansion LLC    Phone:    1-408-962-2500    915
DeGuigne Drive    Fax:    408-982-6254    P.O. Box 3453    Internet:   
www.spansion.com

Purchase Order

 

Bill To:      

 

Information

          Spansion LLC – US Sunnyvale               5204 East Ben White Blvd.   
   PO Number    5100226752    Rev No:       00 Mail Stop 13Png       Date   
2010/01/14 Austin TX 78741       Vendor No.    210062       Currency    JPY

 

    Vendor Address

      Payment Terms    N/5 Days from 15th of 2nd Month         Buyer/Extension
   Joanne Aiello / 26669

Spansion Japan Limited – Takaku

      Confirmed with     

JAPAN

      Incoterms    FCA Narita Airport         CA Permit No.    SRGH100-241785

Fax:

 

      TX Permit No.    1-65-1180482-1                       Ship To:           
  Spansion LLC – US Sunnyvale          943 DeGuigne Dr.          SUNNYVALE CA
94085          USA         

 

Item    

 

Material/Description

  Dely Date     Qty UM     Net Price     Net Amount      

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

IMPORTANT TO ENSURE PROMPT PAYMENT OF YOUR INVOICE:

- E-MAIL YOUR INVOICE DIRECTLY TO

[ SPANSION.AP@spansion.com ] FOR POSTING.

- INDICATE Spansion LLC PURCHASE ORDER NUMBER ON OUTSIDE OF ALL PACKAGES,
PACKING LISTS AND INVOICES.

INCLUDING CORRESPONDING SPANSION PO LINE ITEM NUMBERS ON INVOICE.

- ALL SHIPMENTS ON THIS ORDER MUST PASS THROUGH RECEIVING AND VISUAL INSPECTION
PRIOR TO BEING FORWARDED TO END USER.

- SUPPLIER IS RESPONSIBLE FOR TRACKING ALL BOOKINGS AND SHIPMENTS AGAINST THIS
PO.

NOTIFY SPANSION GLOBAL SUPPLY MANAGEMENT WHEN THIS PO BECOMES 85% CONSUMED.

- DO NO EXCEED VALUE OF PO WITHOUT WRITTEN CHANGE ORDER FROM SPANSION GLOBAL
SUPPLY MANAGEMENT.

INVOICES WITHOUT Spansion LLC PO & LINE ITEM NUMBERS WILL BE RETURNED.

XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX

TEXT FOR EXAMPLE PO FOR EXHIBIT TO FOUNDRY AGREEMENT

*****************************************************

NOTE: The payment terms set out in paragraph 5 below replace and

               

VENDOR, PLEASE NOTE….

1. Please sign and return attached acknowledgement immediately.

2. Provided this order is not subject to the Evaluated Receipts Settlement
payment process, vendor must send all invoices directly to the Spansion Accounts
Payable department at the address referenced above.

3. This order can be accepted only upon the terms and conditions specified on
the face hereof and attached hereto, including the attached Terms and Conditions
of Purchase and any specifications, drawings or other documents as are
incorporated herein by reference and attached hereto. If no Terms and Conditions
are attached, contact the Buyer named above immediately for a copy.

4. Any additional or different terms in any document provided by vendor, even if
such document is incorporated by reference, are deemed to be material
alterations and notice of objection to them and rejection of them is hereby
given. Any reference to any proposal, quotation or other communication by
vendor, unless specifically indicated to the contrary herein, shall be deemed to
be limited to the description of the goods and services.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

27

--------------------------------------------------------------------------------

LOGO [g66174g74c98.jpg]    Spansion LLC    Phone:    1-408-962-2500    915
DeGuigne Drive    Fax:    408-982-6254    P.O. Box 3453    Internet:   
www.spansion.com

Purchase Order

 

Bill To:      

 

Information

          Spansion LLC – US Sunnyvale               5204 East Ben White Blvd.   
   PO Number    5100226752    Rev No:       00 Mail Stop 13Png       Date   
2010/01/14 Austin TX 78741       Vendor No.    210062       Currency    JPY

 

    Vendor Address

      Payment Terms    N/5 Days from 15th of 2nd Month         Buyer/Extension
   Joanne Aiello / 26669

Spansion Japan Limited – Takaku

      Confirmed with     

JAPAN

      Incoterms    FCA Narita Airport         CA Permit No.    SRGH100-241785

Fax:

 

      TX Permit No.    1-65-1180482-1                       Ship To:           
  Spansion LLC – US Sunnyvale          943 DeGuigne Dr.          SUNNYVALE CA
94085          USA         

 

Item        Material/Description    Dely Date      Qty UM      Net Price     
Net Amount       

Superseded the payment terms which appear on Page 1 of the Purchase order.

 

Also, Item # 3 under “Vendor please note” on Page 1 of this PO is replaced and
superseded by the following:

 

“This order can be accepted only upon the terms and conditions specified on the
face hereof as set forth in the amended foundry agreement and included in any
specifications, drawings or other documents as are incorporated herein by
reference and attached hereto. In the event of any conflict between the terms of
any such documents, the terms of the amended foundry agreement shall prevail.”

*************************************************************

1. This purchase order covers shipments of wafers made and sort services
provided during the period starting [ ] and ending [ ].

2. Japan will ship wafers to LLC’s locations in accordance with the weekly
schedules below and attached. The schedule may be adjusted in accordance with
the amended foundry agreement.

3. This PO Is issued pursuant to the amended foundry agreement. JV3 wafers
shipped and sort services provided pursuant to this PO will, on the terms and to
the extent provided in the amended foundry agreement, count toward the minimum
purchase commitments as provided in the amended foundry agreement.

4. Spansion Japan will invoices Spansion for wafers on a “wafer out” basis for
all wafers purchased by Spansion under this purchase order.

Spansion Japan will invoice Spansion on a monthly basis for sort service fees.

                   

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

28

--------------------------------------------------------------------------------

Exhibit G: Purchase Order

 

LOGO [g66174g74c98.jpg]    Spansion LLC    Phone:    1-408-962-2500    915
DeGuigne Drive    Fax:    408-982-6254    P.O. Box 3453    Internet:   
www.spansion.com

Purchase Order

 

Bill To:      

 

Information

          Spansion LLC – US Sunnyvale               5204 East Ben White Blvd.   
   PO Number    5100226752    Rev No:       00 Mail Stop 13Png       Date   
2010/01/14 Austin TX 78741       Vendor No.    210062       Currency    JPY

 

    Vendor Address

      Payment Terms    N/5 Days from 15th of 2nd Month         Buyer/Extension
   Joanne Aiello / 26669

Spansion Japan Limited – Takaku

      Confirmed with     

JAPAN

      Incoterms    FCA Narita Airport         CA Permit No.    SRGH100-241785

Fax:

 

      TX Permit No.    1-65-1180482-1                       Ship To:           
  Spansion LLC – US Sunnyvale          943 DeGuigne Dr.          SUNNYVALE CA
94085          USA         

 

Item    Material/Description    Dely Date      Qty UM      Net Price     
Net Amount       

5. Payment from LLC to Spansion Japan shall be made in Japanese Yen Through wire
transfer, or other means agreed upon by the parties.

Payment will be due five (5) Japanese business banking days after the 15th of
the second month following the month of the completion of fabrication of the
wafers or the performance of the sort services, as applicable.

6. Spansion Japan shall deliver all wafers covered by this PO to Spansion on a
FCA (Incoterms 2000) Narita Airport basis, unless otherwise agreed by the
parties. Spansion Japan shall pay for freight and insurance up to Narita Airport
and Spansion shall be responsible for all freight and insurance beyond that
point. This is not intended to vary the terms of delivery under the amended
foundry agreement, which shall govern in the event of a conflict.

7. Wafer Prices (unsorted)

- Price for JV3 die is based on unsorted wafer price of [*].

- Price for Sp1 die is based on unsorted wafer price of [*].

- Price for FSET die is based on unsorted wafer price of [*].

8. Sort Service Fee

- [*] for Q2/52 tester and V3308 tester

- [*] for V5400 tester

-[*] for BIST FOX tester

                              

Example: JV3 wafers to FMO

DETAIL TEXT EXAMPLE

IDV                          QTY

22222222                 100

   2010/01/30      1.000 AU      1      1  

0010

   33338888                 20                       

Net value incl. disc

                1     

Tax

                  0

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

29

--------------------------------------------------------------------------------

Exhibit G: Purchase Order

 

LOGO [g66174g74c98.jpg]    Spansion LLC    Phone:    1-408-962-2500    915
DeGuigne Drive    Fax:    408-982-6254    P.O. Box 3453    Internet:   
www.spansion.com

Purchase Order

 

Bill To:      

 

Information

          Spansion LLC – US Sunnyvale               5204 East Ben White Blvd.   
   PO Number    5100226752    Rev No:       00 Mail Stop 13Png       Date   
2010/01/14 Austin TX 78741       Vendor No.    210062       Currency    JPY

 

    Vendor Address

      Payment Terms    N/5 Days from 15th of 2nd Month         Buyer/Extension
   Joanne Aiello / 26669

Spansion Japan Limited – Takaku

      Confirmed with     

JAPAN

      Incoterms    FCA Narita Airport         CA Permit No.    SRGH100-241785

Fax:

 

      TX Permit No.    1-65-1180482-1                       Ship To:           
  Spansion LLC – US Sunnyvale          943 DeGuigne Dr.          SUNNYVALE CA
94085          USA         

 

Item    Material/Description    Dely Date      Qty UM      Net Price     
Net Amount       

Total Price                

 

 

 

                  1

**************

 

SIGNATURE  

 

  DATE  

 

     SPANSION LLC                              SIGNATURE  

 

  DATE  

 

     Vendor Acknowledgement           

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

30

--------------------------------------------------------------------------------

Schedule 1.14: Spansion Competitor

Spansion Competitor means (i) any of the following NOR or NAND Flash memory
manufacturer that competes or may compete with Spansion in the NOR/NAND
stand­alone product area: [*], and (ii) any integrated device manufacturers of
any non-volatile memory products.

 

[*] Certain information in this document has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

31