Exhibit 10.162


 


[***]
DENOTES CONFIDENTIAL MATERIALS OMITTED AND FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT.


 


INTEL/MICRON CONFIDENTIAL


 


SUPPLY
AGREEMENT


 


This SUPPLY AGREEMENT (the “Agreement”), is made and entered into as of this 6th
day of January, 2006 (the “Effective Date”),
by and between Micron Technology, Inc., a Delaware corporation (“Micron”), and IM
Flash Technologies, LLC, a Delaware limited liability company (the “Joint Venture Company”).


 


RECITALS


 


A.            The Joint
Venture Company is engaged in the manufacturing, assembly and test of NAND
Flash Memory Products (as defined hereinafter) for Micron.


 


B.            Micron
and the Joint Venture Company (each, a “Party” and
collectively, the “Parties”)
desire the Joint Venture Company to supply Products, including Secondary Silicon,
for Micron in accordance with Micron’s Sharing Interest upon the terms and
subject to the conditions set forth in this Agreement.


 


AGREEMENT


 


NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the Parties intending to be legally bound do hereby agree as follows.


 


ARTICLE 1

DEFINITIONS; CERTAIN INTERPRETIVE MATTERS


 


1.1           Definitions.  In addition to the terms defined elsewhere in
this Agreement, capitalized terms used in this Agreement shall have the
respective meanings set forth in Exhibit A.


 


1.2           Certain
Interpretive Matters.


 


(a)           Unless the
context requires otherwise, (1) all references to Sections, Articles, Exhibits,
Appendices or Schedules are to Sections, Articles, Exhibits, Appendices or
Schedules of or to this Agreement, (2) each of the Schedules will apply
only to the corresponding Section or subsection of this Agreement,
(3) each accounting term not otherwise defined in this Agreement has the
meaning commonly applied to it in accordance with Modified GAAP, (4) words
in the singular include the plural and visa versa, (5) the term “including”
means “including without limitation,” and (6) the terms “herein,”
“hereof,” “hereunder” and words of similar import shall mean
references to this Agreement as a whole and not to any individual Section or
portion hereof. All references to $ or dollar amounts will be to lawful
currency of the United States of America. All references to “day” or “days”
will mean calendar days and all references to “quarter(ly)”, “month(ly)” or “year(ly)”
will mean Fiscal Quarter, Fiscal Month or Fiscal Year, respectively.


 


(b)           No provision of
this Agreement will be interpreted in favor of, or against, any of the Parties
by reason of the extent to which any such Party or its counsel participated in
the drafting


 





















 


thereof or by reason of the
extent to which any such provision is inconsistent with any prior draft of this
Agreement or such provision.




ARTICLE 2

OBLIGATIONS OF THE JOINT VENTURE COMPANY; 


PROCESSES
AND CONTROLS


 


2.1           General
Obligations. The Joint Venture Company will (1) supply Product to Micron in
accordance with the purchasing process set forth in Article 4 hereof;
(2) develop its Facilities and operations to meet Capacity according to the
Ramp Plan and the Initial Business Plan, as may be amended thereafter, and the
Operating Plan and the obligations set forth herein, including Sections 2.2,
2.5 and 2.9; (3) supply Products which meet the Specification(s), Price,
Yield, Cycle-Time, and Quality and Reliability as agreed by the Parties; and
(4) operate its Facilities so that Product output from any one Facility matches
the other Facilities in form, fit and function, in accordance with Section
2.14.


 


2.2           Products to
Supply.  The Joint Venture Company will
manufacture, assemble and test Products for Micron in accordance with the
Operating Plan and applicable Specifications, developed in response to Micron’s
Demand Forecast provided to Joint Venture Company in accordance with Article
3 below.


 


2.3           Process and
Design Information.  Micron
agrees to provide to the Joint Venture Company: (i) such process technology or
information as is required to be disclosed under the Joint Development Program
Agreement and the Technology License Agreement; and (ii) design information
reasonably required to manufacture NAND Flash Memory Wafers.


 


2.4           Control;
Processes. The Joint Venture Company and Micron will review
Joint Venture Company’s control and process mechanisms, including but not
limited to such mechanisms that are utilized to ensure that all parameters of
the Specification, including the Performance Criteria, are met or exceeded in
the Joint Venture Company’s manufacture of Products by either the Joint Venture
Company or its approved subcontractor for Micron.  The Parties agree to work together in good
faith to define mutually agreeable control and process mechanisms including the
following: [***].


 


2.5           Equipment,
Systems, Materials.  Except as provided in other Joint Venture Documents, the
Joint Venture Company shall be responsible for procuring all manufacturing
equipment, tools, automated material handling systems therein and materials,
including Prime Wafers, which are reasonably required for the Joint Venture
Company to achieve the Ramp Plan and the Operating Plan.  The Joint Venture Company shall endeavor to
manage the entire supply chain, including equipment, materials, systems,
maintenance and subcontractors and vendors, to create efficiency and maximize
the Performance Criteria.


 


2.6           Production
Masks.  Unless otherwise agreed with Micron, the
Joint Venture Company or its subcontractors will be responsible to obtain,
maintain, repair and replace masks used in the production of Products.  Such masks will only be used in the
production of Products for Micron. 
Production masks will be repaired and replaced solely at mask operations
which have been approved by Micron, which approval shall not be unreasonably
withheld.  [***].


 


2





















 


2.7           Designation
of WIP.  [***].


 


2.8           Subcontractors.  The Joint Venture Company may utilize
subcontractors to perform any portion of the manufacture, assembly and test
process in making Products for Micron, subject to all subcontractors being
approved by the Members, which approval shall not be unreasonably
withheld.   The Joint Venture
Company will ensure that all contracts with subcontractors will provide the
Joint Venture Company with the same level of access and controls as set forth
in the Agreement, including Sections 2.4, 2.9, 2.10, 2.11, 2.12 and Article
5.


 


2.9           Staffing.  The Joint Venture Company shall adequately
staff its Facilities and ensure that its subcontractors adequately staff their
facilities to sustain and manage production of Product for Micron, including
the obligations set forth in Section
2.1 and meeting scheduled commitments, including the Ramp Plan, the
Operating Plan and the Performance Criteria.


 


2.10         Business
Continuity Plan.  The Joint Venture Company will develop a
process to recover the production process in the event of a natural disaster or
any other event that disrupts the production process or the ability of the
Joint Venture Company to meet its delivery commitments to Micron or satisfy customer
orders.  If requested by Micron, Joint
Venture Company will review its Business Continuity Plan with Micron and make
changes as agreed with Micron, subject to any confidentiality requirements.


 


2.11         [***].  In addition to the
quarterly review and monthly report requirements set forth in Section 3.2
and 3.3, the Joint Venture Company will promptly notify Micron of [***].


 


2.12         Traceability
and Data Retention. Micron
and the Joint Venture Company shall review the Joint Venture Company’s process
traceability system [***].  The Joint
Venture Company agrees to maintain such data for a minimum of [***].
The Joint Venture Company will endeavor to provide Micron [***].


 


2.13         Additional
Customer Requirements.  Micron will inform the Joint Venture Company
in writing of any auditable supplier requirements of Micron’s customer relating
to any Facility at which Product is manufactured, assembled or tested.  The Parties will work together in good faith
to resolve such requests.


 


2.14         Transfer;
Equivalency of Operations.  [***].


 


3





















 


ARTICLE 3


PLANNING
MEETINGS AND FORECASTS;


PERFORMANCE
REVIEWS AND REPORTS


 


3.1           Planning
and Forecasting.


 


(a)           Micron
will quarterly provide the Joint Venture Company, in a timeframe to be mutually
agreed by the Parties to meet customer expectations, with a written demand
forecast for [***] ([***]) quarters corresponding to the Joint Venture Company’s
Fiscal Quarters or as may be otherwise agreed between the Parties.  This demand will include desired finished
product breakout by design id, technology node, wafer as finished goods or
package type (“Demand Forecast”);


 


(b)           The
Joint Venture Company shall furnish Micron with a written response within [***]
([***]) Business Days indicating a response regarding capacity and what portion
of the demand that the Joint Venture Company can commit to meet.  This written response (the “Planning Forecast”) will include:


 


[***].


 


(c)           Based
on the Planning Forecast, the Joint Venture Company shall develop a [***]
([***]) Fiscal Quarter proposed Product loading plan for such period (“Proposed Loading Plan”). The Joint Venture Company shall
provide Micron with the Proposed Loading Plan at least [***] ([***]) Business
Days prior to its review by the Manufacturing Committee.


 


(d)           The
Joint Venture Company will submit the Proposed Loading Plan, Planning Forecast
and other requested information to the Manufacturing Committee for
endorsement.  Once endorsed by the
Manufacturing Committee, the Proposed Loading Plan shall become part of the
Operating Plan.


 


3.2           Performance Reviews and Reports.  The Joint Venture Company shall meet with
Micron each quarter to discuss the Performance Criteria and the most recent
monthly report.   The monthly report will
be distributed to Micron monthly, on a date to be agreed by the Parties, and
will include the following information:


 


(a)           Describes
[***];


 


(b)           Describes
[***];


 


(c)           Describes
[***];


 


4





















 


(d)           Describes
[***].


 


(e)           Identifies [***].


 


 3.3          Monthly
Review.  In addition, the Parties
shall hold a monthly meeting, on a date to be agreed by the Parties, with the
primary purpose of [***].


 


ARTICLE 4


PURCHASE AND SALE OF PRODUCTS


 


4.1           Product
Quantity. Micron shall purchase from the Joint Venture Company a
percentage, equal to Micron’s Sharing Interest (as the same may change from
time to time), of all of the Joint Venture Company’s output of Products that
meet the Specifications.  The Joint
Venture Company shall produce all Products in accordance with the Operating
Plan, developed in response to Micron’s Demand Forecast under Article 3 above.  If
Micron fails purchase its full Sharing Interest of the Joint Venture Company’s
output, produced in accordance with the Operating Plan (“Underloading”),
then the increased Prices associated with such Underloading shall be isolated
and charged solely to Micron, which Micron shall remain solely responsible for
paying.  Notwithstanding the foregoing,
Micron may elect, but is not obligated, to purchase Product in excess of its
Sharing Interest only by mutual agreement of the other Member.  


 


4.2           Secondary
Silicon. Any Secondary Silicon produced by the Joint
Venture Company or its subcontractors will be provided [***] by the Joint
Venture Company to the Members in a percentage equal to Micron’s Sharing
Interest (as the same may change from time to time).  ALL SECONDARY SILICON PROVIDED HEREUNDER IS
PROVIDED “AS IS,” “WHERE IS” WITH ALL FAULTS AND DEFECTS BASIS WITHOUT
WARRANTY OF ANY KIND.


 


4.3           Placement of Purchase Orders. Prior to the commencement
of every Fiscal Quarter or another time period agreed by the Parties in
conjunction with the planning cycle specified in Article 3, the Joint
Venture Company shall place a non-cancelable blanket purchase order in writing
(via e-mail or facsimile transmission) for the quantity of Product to be
supplied by the Joint Venture Company in the following Fiscal Quarter as
indicated in the Operating Plan (each such order, a “Purchase
Order”).  Micron may issue change orders to such Purchase
Orders to reflect changes in the Operating Plan, provided that such changes can
be reasonably accommodated by the Joint Venture Company without disrupting
on-going manufacturing operations.  Micron may also elect to place out-of-cycle
purchase order of Product, including expedited Probed Wafers, to the Joint
Venture Company on an as-needed basis.  The terms and conditions of
this Agreement supersede the terms and conditions contained in either Party’s
sales or purchase documentation provided in connection herewith unless
expressly agreed otherwise in a writing signed by each Party.


 


4.4           Shortfall.  The Joint Venture
Company shall immediately notify Micron in writing of any inability to meet a
Purchase Order commitment to Micron.


 


5





















 


4.5           Acceptance
of Purchase Order. Each
Purchase Order that corresponds to the Operating Plan in the manner
contemplated by Section 4.3 and, and is otherwise free of errors, shall
be deemed accepted by the Joint Venture Company upon receipt and shall be
binding on the Parties, to the extent not inconsistent with the Operating Plan.


 


4.6           Content
of Purchase Orders. Each
Purchase Order shall specify the following items:


 


(a)           Purchase
Order number;


 


(b)           Description
and part number of each Product;


 


(c)           Forecasted
quantity of each different Product and the Sharing Interest portion thereof for
the calendar month;


 


(d)           Forecasted
unit Price and total forecasted Price for each different Product, and total
forecasted Price for all Products ordered;


 


(e)           Level
of Probe Testing;


 


(f)            Marking
specification and packaging requirements;


 


(g)           Requested
delivery date;


 


(h)           Place
of delivery; and


 


(i)            Other
terms (if any).


 


4.7           Taxes.


 


(a)           General.  All sales, use and other transfer taxes
imposed directly on or solely as a result of the supplying of Products and the
payments therefor provided herein shall be stated separately on the Joint
Venture Company’s invoice, collected
from Micron and shall be remitted by the Joint Venture Company to
the appropriate tax authority (“Recoverable Taxes”),
unless Micron provides valid proof of tax exemption prior to the effective date of the
transfer of the Products or otherwise as permitted by law prior to the time the
Joint Venture Company is required to pay such taxes to the appropriate tax
authority. When property is delivered and/or services are
provided or the benefit of services occurs within jurisdictions in which
collection and remittance of taxes by Micron is required by law, the Joint
Venture Company shall have sole responsibility for payment of said taxes to the
appropriate tax authorities. In the event such taxes are Recoverable Taxes and
the Joint Venture Company does not collect tax from Micron or pay such taxes to
the appropriate governmental entity on a timely basis, and is subsequently
audited by any tax authority, liability of Micron will be limited to the tax
assessment for such Recoverable Taxes, with no reimbursement for penalty or
interest charges or other amounts incurred in connection therewith.
Notwithstanding anything herein to the contrary, taxes other than Recoverable
Taxes shall not be reimbursed by Micron, and each Party is responsible for its
own respective income taxes (including franchise and other taxes based on net income
or a variation thereof), taxes based upon gross revenues or receipts, and taxes
with respect to general overhead, including but not limited to business and
occupation taxes, and such taxes shall not be Recoverable Taxes.


 


(b)           Withholding
Taxes.  In the event that Micron is
prohibited by law from making payments to the Joint Venture Company unless
Micron deducts or withholds taxes therefrom and remits such taxes to the local
taxing jurisdiction, then Micron shall duly withhold and remit such taxes and shall



 


6





















 


pay
to the Joint Venture Company the remaining net amount after the taxes have been
withheld.  Such taxes shall not be
Recoverable Taxes and Micron shall not reimburse the Joint Venture Company for
the amount of such taxes withheld.


 


4.8           Invoicing; Payment.   The Joint Venture Company shall invoice
Micron on a monthly basis for the Price of the Products provided and all
overhead, interest, general and administrative and other costs, including all
start-up costs for Facilities which shall be split between the Members based on
Sharing Interest.  All amounts owed under
this Agreement are stated, calculated and shall be paid in United States
Dollars.  Except as otherwise specified
in this Agreement, the Micron shall pay the Joint Venture Company for the
amounts due, owing, and duly invoiced under this Agreement within [***] ([***])
days following delivery
of an invoice therefore to such place as the Joint Venture Company may
reasonably direct therein.


 


4.9           Payment to Subcontractors.  The Joint Venture Company shall be
responsible for and shall hold Micron harmless for any and all payments to its
vendors or subcontractors utilized in the performance of this Agreement.


 


4.10         Delivery,
Title and Risk of Loss. The
Joint Venture Company, in order to ensure timely and complete shipment of
Products to Micron, shall arrange for and pay for all shipping charges,
insurance, taxes, customs charges and any fees and duties in connection with
such shipment.  The Joint Venture Company
shall hold title to and risk of loss of Products under this Agreement,
including WIP held by subcontractors, until tender to the carrier, at which
time title and risk of loss and damage to Products shall transfer to Micron.


 


4.11         Packaging. All shipment packaging of the Products shall be in
conformance with the Specifications, the Micron’s reasonable instructions, and
general industry standards, and shall be resistant to damage that may occur
during transportation. Marking on the packages shall be made by Joint Venture
Company in accordance with Micron’s reasonable instructions.


 


4.12         Shipment.  All Products shall be prepared for shipment
in a manner that: (i) follow good commercial practice; (ii) is acceptable to
common carriers for shipment at the lowest rate; and (iii) is adequate to
ensure safe arrival.  The Joint Venture
Company shall mark all containers with necessary lifting, handling, and
shipping information, Purchase Order number, date of shipment, and the names of
the Micron and applicable customer.  If
no instructions are given, the Joint Venture Company shall select the most
price effective carrier, given the time constraints known to the Joint Venture
Company.   At Micron’s request, the Joint
Venture will provide drop-shipment of Products to Micron’s customers.  Such shipment service may be provided by a
subcontractor to the Joint Venture Company provided that title remains with the
Joint Venture Company and then passes to Micron upon tender to the carrier.


 


4.13         Customs Clearance.  Upon Micron’s request, the Joint Venture
Company will promptly provide Micron with a statement of origin for all
Products and with applicable customs documentation for Products wholly or
partially manufactured outside of the country of import.


 


ARTICLE 5

VISITATIONS, AUDITS


 


5.1           Visits. The Joint Venture Company will support Micron’s reasonable
requests for visits to Facilities and meetings for the purpose of reviewing
performance of production of Products including requests for
further information and assistance in troubleshooting performance issues. Such requests shall 


 


7





















 


be
reasonably granted by the Joint Venture Company so long as such visits and
meetings do not unduly interfere with the Joint Venture Company’s operations
and business affairs.


 


5.2           Audit.  Micron
representatives and key customer representatives, upon Micron’s request, shall
be allowed to visit the Joint Venture Company’s Facilities during normal
working hours upon reasonable advanced written notice to the Joint Venture
Company for the purposes of monitoring production processes and compliance with
any requirements set forth in this Agreement and the Specifications.  Upon completion of the audit, the Joint
Venture Company and Micron will agree to an audit closure plan, to be
documented in the audit report issued by Micron.


 


5.3           Financial Audit.  Micron reserves the right to have the Joint
Venture Company’s books and records related to the Pricing hereunder inspected
and audited not more than [***] during any Fiscal Year to ensure compliance
with Schedule 4.8 of this Agreement in regards to Pricing.  Such audit
will be performed by an independent third party auditor acceptable to both
Parties at Micron’s expense.  Micron
shall provide [***] ([***]) days advance written notice to the Joint Venture
Company of its desire to initiate an audit and the audit shall be scheduled so
that it does not adversely impact or interrupt the Joint Venture Company’s
business operations. If the audit reveals any material discrepancies, the Joint
Venture Company or Micron shall reimburse the other, as applicable, for any
material discrepancies within [***] ([***]) days after completion of the
audit.  The results of such audit shall be kept confidential by the auditor
and only the discrepancies shall be reported to the Parties, and be limited to
discrepancies identified by the audit. 
Notwithstanding the foregoing, any auditor reports shall not disclose
any the Joint Venture Company pricing or terms of purchase for any purchases of
materials or equipment hereunder to Micron, absent written agreement from the
Members’ respective legal counsel.  If
any audit reveals a material discrepancy, Micron may increase the frequency of
such audits to [***] for the subsequent [***] ([***]) month period.


 


5.4           Subcontractor;
Vendor Visits. The
Joint Venture Company will
use commercially reasonable efforts to ensure that all contracts
with vendors and subcontractors will provide the Joint Venture Company and
Micron with the right to visit and audit rights similar to those set forth in
this Article 5.


 


ARTICLE 6

WARRANTY; HAZARDOUS MATERIALS; DISCLAIMER


 


6.1           Product
Warranty. The
Joint Venture Company makes the following warranties regarding Products
furnished hereunder, which warranties shall survive any delivery, inspection,
acceptance, payment, or resale of the Products:


 


(a)           Products conform to all agreed Specifications;


 


(b)           Products are free from defects in materials or workmanship;
and


 


(c)           The Joint Venture Company has the necessary right, title,
and interest to provide Products to the Joint Venture Company and the Products
will be free of liens and encumbrances, not including any implied warranty of non-infringement.


 


6.2           Warranty
Claims.  [***].


 


8





















 


6.3           Inspections.
Member may, upon reasonable advance written notice, request samples of Products
(including WIP) during production for purposes of determining compliance with
the requirements and Specification(s) hereunder, provided that the provision of
such samples shall not materially impact the Joint Venture Company’s
performance to the Operating Plan or its ability to meet delivery requirements
under any accepted Purchase Order.  Any
samples provided hereunder shall be: (i) limited in quantity to the amount
reasonably necessary for the purposes hereunder; (ii) included in the pricing;
and (iii) included in any performance requirements, if any.  The Joint Venture Company shall provide
reasonable assistance for the safety and convenience of Micron in obtaining the
samples in such manner as shall not unreasonably hinder or delay the Joint
Venture Company’s performance.


 


6.4           Hazardous
Materials.


 


(a)           If
Products provided hereunder include Hazardous Materials as determined in
accordance with applicable law, the Joint Venture Company represents and
warrants that the Joint Venture Company and the Joint Venture Company’s
employees, agents, and subcontractors actually working with such materials in providing the Products
hereunder to Micron shall be
trained in accordance with applicable law regarding the nature of
and hazards associated with the handling, transportation, and use of such
Hazardous Materials, as applicable to the Joint Venture Company.


 


(b)           To
the extent required by applicable law, Joint Venture Company shall provide
Micron with Material Safety Data Sheets (MSDS) either prior to or accompanying
any delivery of Products to Micron.


 


6.5           Disclaimer.  [***].


 


9





















 


ARTICLE 7

CONFIDENTIALITY; OWNERSHIP


 


7.1           Protection
and Use of Confidential Information.
All information provided, disclosed or obtained in the performance of any of
the Parties’ activities under this Agreement shall be subject to all applicable
provisions of the Confidentiality Agreement. Furthermore, the terms and
conditions of this Agreement shall be considered “Confidential
Information” under the Confidentiality Agreement for which each
Party is considered a “Receiving Party”
under such agreement. To the extent there is a conflict between this Agreement
and the Confidentiality Agreement, the terms of this Agreement shall control.


 


7.2           Masks.  Any masks produced
pursuant to this Agreement will be based on Product designs owned by Intel and
shall be treated as Confidential Information of Intel.


 


7.3           Intellectual
Property Ownership.
Ownership of any intellectual property developed by the Joint Venture Company
will be governed by the Technology License Agreement or Product Designs
Development Agreement.


 


ARTICLE 8

INDEMNIFICATION


 


8.1           Mutual General Indemnity.  [***].


 


8.2           Indemnification Procedures.


 


(a)           Promptly after
the receipt by any Indemnified Party of a notice of any Third Party Claim that
an Indemnified Party seeks to be indemnified
under this Agreement, such Indemnified Party shall give written notice of such
Third Party Claim to the Indemnifying Party, stating in reasonable detail the
nature and basis of each allegation made in the Third Party Claim and the
amount of potential Indemnified Losses with respect to each allegation, to the
extent known, along with copies of the relevant documents received by the
Indemnified Party evidencing the Third Party Claim and the basis for
indemnification sought.  Failure of the
Indemnified Party to give such notice shall not relieve the Indemnifying Party
from liability on account of this indemnification, except if and only to the
extent that the Indemnifying Party is actually prejudiced by such failure or
delay.  Thereafter, the Indemnified Party
shall deliver to the Indemnifying Party, promptly after the Indemnified Party’s
receipt thereof, copies of all notices and documents (including court papers)
received by the Indemnified Party relating to the Third Party Claim.  The Indemnifying Party shall have the right
to assume the defense of the Indemnified Party with respect to such Third Party
Claim upon written notice to the Indemnified Party delivered within [***] after
receipt of the particular notice from the Indemnified Party.  So long as the Indemnifying Party has assumed
the defense of the Third Party Claim in accordance herewith and notified the
Indemnified Party in writing thereof, (i) the Indemnified Party may retain
separate co-counsel at its sole cost and expense and participate in the defense
of the Third Party Claim, it being understood that the


 


10





















 


Indemnifying Party shall pay
all reasonable costs and expenses of counsel for the Indemnified Party after such
time as the Indemnified Party has notified the Indemnifying Party of such Third
Party Claim and prior to such time as the Indemnifying Party has notified the
Indemnified Party that it has assumed the defense of such Third Party Claim,
(ii) the Indemnified Party shall not file any papers or, other than in
connection with a settlement of the Third Party Claim, consent to the entry of
any judgment without the prior written consent of the Indemnifying Party (not
to be unreasonably withheld, conditioned or delayed) and (iii) the Indemnifying
Party will not consent to the entry of any judgment or enter into any
settlement with respect to the Third Party Claim (other than a judgment or
settlement that is solely for money damages and is accompanied by a release of
all indemnifiable claims against the Indemnified Party) without the prior
written consent of the Indemnified Party (not to be unreasonably withheld,
conditioned or delayed).  Whether or not
the Indemnifying Party shall have assumed the defense of the Indemnified Party
for a Third Party Claim, such Indemnifying Party shall not be obligated to
indemnify and hold harmless the Indemnified Party hereunder for any consent to
the entry of judgment or settlement entered into with respect to such Third
Party Claim without the Indemnifying Party’s prior written consent, which
consent shall not be unreasonably withheld, conditioned or delayed.


 


(b)           Equitable
Remedies.  In the case
of any Third Party Claim where the Indemnifying Party reasonably believes that
it would be appropriate to settle such Third Party Claim using equitable
remedies (i.e., remedies involving the future activity and conduct of the Joint
Venture Company), the Indemnifying Party and the Indemnified Party shall work
together in good faith to agree to a settlement; provided, however, that no
Party shall be under any obligation to agree to any such settlement.


 


(c)           Treatment of
Indemnification Payments; Insurance Recoveries.  Any indemnity payment under this Agreement
shall be decreased by any amounts actually recovered by the Indemnified Party
under third party insurance policies with respect to such Indemnified Losses
(net of any premiums paid by such Indemnified Party under the relevant
insurance policy), each Party agreeing (i) to use all reasonable efforts to
recover all available insurance proceeds and (ii) to the extent that any
indemnity payment under this Agreement has been paid by the Indemnifying Party
to the Indemnified Party prior to the recovery by the Indemnified Party of such
insurance proceeds, the amount of such insurance proceeds actually recovered by
the Indemnified Party shall be promptly paid to the Indemnifying Party.


 


(d)           Certain Additional Procedures.  The Indemnified Party shall cooperate and
assist the Indemnifying Party in determining the validity of any Third Party
Claim for indemnity by the Indemnified Party and in otherwise resolving such
matters.  The Indemnified Party shall
cooperate in the defense by the Indemnifying Party of each Third Party Claim
(and the Indemnified Party and the Indemnifying Party agree with respect to all
such Third Party Claim that a common interest privilege agreement exists
between them), including, (i) permitting the Indemnifying Party to discuss the
Third Party Claim with such officers, employees, consultants and
representatives of the Indemnified Party as the Indemnifying Party reasonably
requests, (ii)  providing to the
Indemnifying Party copies of documents and samples of products as the
Indemnifying Party reasonably requests in connection with defending such Third
Party Claim, (iii)  preserving all
properties, books, records, papers, documents, plans, drawings, electronic mail
and databases of the Joint Venture Company and relating to matters pertinent to
the conduct of the Joint Venture Company under the Indemnified Party’s custody
or control in accordance with such Party’s corporate documents retention
policies, or longer to the extent reasonably requested by the Indemnifying
Party, (iv) notifying the Indemnifying Party promptly of receipt by the
Indemnified Party of any subpoena or other third party request for documents or
interviews and testimony, (v) providing to the Indemnifying Party copies of any
documents produced by the Indemnified Party in response to or compliance with
any subpoena or other third party request for documents; and (vi) except to the
extent inconsistent with the Indemnified Party’s obligations under applicable
law and except to the 


 


11





















 


extent that to do so would subject the Indemnified Party or its
employees, agents or representatives to criminal or civil sanctions, unless
ordered by a court to do otherwise,  not
producing documents to a third party until the Indemnifying Party has been
provided a reasonable opportunity to review, copy and assert privileges
covering such documents.


 


ARTICLE 9

LIMITATION OF LIABILITY


 


9.1           Damages
Limitation.  [***].


 


9.2           THE PARTIES AGREE THAT
TO THE EXTENT A CLAIM ARISES UNDER THIS AGREEMENT, THE CLAIM SHALL BE BROUGHT
UNDER THIS AGREEMENT.


 


9.3           Damages Cap. 
[***].


 


9.4           Exclusions
and Mitigation. Section 9.1
and 9.3 will not apply to either Party’s breach of ARTICLE 7.  Section
9.3 will not apply to Micron’s
failure to meet either an Underloading charge under Section 4.1 or a
payment obligation which is due and payable under this Agreement.  Each Party shall have a duty to use
commercially reasonable efforts to mitigate damages for which the other Party
is responsible.


 


9.5           Losses.  Except as provided under Section 8.1,
the Joint Venture Company and Micron each shall be responsible for Losses to
their respective tangible personal or real property (whether owned or leased),
and each Party agrees to look only to their own insurance arrangements with
respect to such damages.  The Joint
Venture Company and Micron waive all rights to recover against each other,
including each Party’s insurers’ subrogation rights, if any, for any loss or
damage to their respective tangible personal property or real property (whether
owned or leased) from any cause covered by insurance maintained by each of
them, including their respective deductibles or self-insured retentions.


 


12





















 


Notwithstanding the
foregoing, in the event of a loss hereunder involving a property, transit or
crime event or occurrence that: (i) is insured under Micron’s insurance policies;
(ii) a single insurance deductible applies; and (iii) the loss event or
occurrence affects the insured ownership or insured legal interests of both
Parties, then the Parties shall share the cost of the deductible in proportion
to each Party’s insured ownership or legal interests in relative proportion to
the total insured ownership or legal interests of the Parties.


 


ARTICLE 10

TERM AND TERMINATION;

SUPPLY OBLIGATIONS FOLLOWING LIQUIDATING EVENT


 


10.1         Term. The term of this Agreement commences on the Effective Date
and continues in effect until the first to occur of (a) the [***] or (b) a [***]  (such period of time, the “Term”).


 


10.2         Termination. This Agreement may not be terminated for any reason,
including breach by a Party, before termination pursuant to Section 10.1.


 


10.3         Masks.  On the Liquidation
Date, the Joint Venture Company shall immediately transfer possession of
production masks possessed by it at each Facility to the Micron that then owns
that Facility as of the Liquidation Date.


 


10.4         Survival. Termination of this Agreement shall not affect any of the
Parties’ respective rights accrued or obligations owed before termination,
including any rights or obligations of the Parties in respect of any accepted
Purchase Orders existing at the time of termination. In addition, the following
shall survive termination of this Agreement for any reason: Sections 2.12,
6.2, 6.5, and Articles 4, 7, 8, 9, 10 and  11.


 


10.5         Supply
Obligations Following Liquidating Event.  Upon the occurrence of a Liquidating Event
any supply obligations of the Parties will be as set forth in Article 13
of the LLC Operating Agreement.


 


ARTICLE 11

MISCELLANEOUS


 


11.1         Force
Majeure Events. The Parties
shall be excused from any failure to perform any obligation hereunder to the extent
such failure is caused by a Force Majeure Event.  A Force Majeure Event shall operate to excuse
a failure to perform an obligation hereunder only for the period of time during
which the Force Majeure Event renders performance impossible or infeasible and
only if the Party asserting Force Majeure as an excuse for its failure to
perform has provided written notice to the other Party specifying the
obligation to be excused and describing the events or conditions constituting
the Force Majeure Event.  As used herein,
“Force Majeure Event” means the
occurrence of an event or circumstance beyond the reasonable control of the
party failing to perform, including, without limitation, (a) explosions, fires,
flood, earthquakes, catastrophic weather conditions, or other elements of
nature or acts of God; (b) acts of war (declared or undeclared), acts of
terrorism, insurrection, riots, civil disorders, rebellion or sabotage; (c)
acts of federal, state, local or foreign governmental authorities or courts;
(d) labor disputes, lockouts, strikes or other industrial action, whether
direct or indirect and whether lawful or


 


13





















 


unlawful; (e) failures or
fluctuations in electrical power or telecommunications service or equipment;
and (f) delays caused by the other Party’s nonperformance hereunder.


 


11.2         Specific
Performance.  The Parties agree that irreparable damage
will result if this Agreement is not performed in accordance with its terms,
and the Parties agree that any damages available at law for a breach of this
Agreement would not be an adequate remedy. 
Therefore, the provisions hereof and the obligations of the Parties
hereunder shall be enforceable in a court of equity, or other tribunal with
jurisdiction, by a decree of specific performance, and appropriate preliminary
or permanent injunctive relief may be applied for and granted in connection
therewith.  Such remedies and all other
remedies provided for in this Agreement shall, however, be cumulative and not
exclusive and shall be in addition to any other remedies that a Party may have
under this Agreement.


 


11.3         Assignment. This Agreement shall be binding upon and inure to
the benefit of the permitted successors and assigns of each Party hereto.
Neither this Agreement nor any right or obligation hereunder may be assigned or
delegated by either Party in whole or in part to any other Person, other than a
Wholly-Owned Subsidiary of such Party, without the prior written consent of the
non-assigning Party.  Any purported assignment in violation of the
provisions of this Section shall be null and void and have no effect.


 


11.4         Compliance
with Laws and Regulations.
Each of the Parties shall comply with, and shall use reasonable efforts to
require that its respective subcontractors comply with, Applicable Laws
relating to this Agreement and the performance of a Party’s rights hereunder.


 


11.5         Notice. All notices and other communications hereunder shall be in
writing and shall be deemed given upon (a) transmitter’s confirmation of a
receipt of a facsimile transmission, (b) confirmed delivery by a standard
overnight carrier or when delivered by hand, (c) the expiration of five
(5) Business Days after the day when mailed in the United States by certified
or registered mail, postage prepaid, or (d) delivery in Person, addressed
at the following addresses (or at such other address for a party as shall be
specified by like notice):


 


In
the case of the IM Flash Technologies, LLC:


1550 East 3400
North


Lehi, Utah 84043


Attention:  David A. Baglee; Rodney Morgan


Facsimile Number:  (801) 767-5370


 


With a mandatory copy to:


Intel Corporation


2200 Mission College Blvd.


Mail-Stop SC4-203


Santa Clara,
California 95054


Attention:  General Counsel


Facsimile Number:  (408) 653-8050


 


In the case of Micron:


Micron Technology, Inc. 

8000 S. Federal Way

Boise, Idaho 83707-0006

Attention:  General Counsel

Facsimile Number:  (208)368-4540


 


14





















 


Either
Party may change its address for notices upon giving ten (10) days written
notice of such change to the other Party in the manner provided above.


 


11.6         Waiver. The failure at any time of a Party to require performance
by the other Party of any responsibility or obligation required by this
Agreement shall in no way affect a Party’s right to require such performance at
any time thereafter, nor shall the waiver by a Party of a breach of any
provision of this Agreement by the other Party constitute a waiver of any other
breach of the same or any other provision nor constitute a waiver of the
responsibility or obligation itself.


 


11.7         Severability. Should any provision of this Agreement be deemed in
contradiction with the laws of any jurisdiction in which it is to be performed
or unenforceable for any reason, such provision shall be deemed null and void,
but this Agreement shall remain in full force in all other respects. Should any
provision of this Agreement be or become ineffective because of changes in
Applicable Laws or interpretations thereof, or should this Agreement fail to
include a provision that is required as a matter of law, the validity of the
other provisions of this Agreement shall not be affected thereby. If such
circumstances arise, the Parties hereto shall negotiate in good faith
appropriate modifications to this Agreement to reflect those changes that are
required by Applicable Law.


 


11.8         Third
Party Rights. Nothing
in this Agreement, whether express or implied, is intended or shall be
construed to confer, directly or indirectly, upon or give to any Person, other
than the Parties hereto, any legal or equitable right, remedy or claim under or
in respect of this Agreement or any covenant, condition or other provision
contained herein.


 


11.9         Amendment. This Agreement may not be modified or amended except by a
written instrument executed by or on behalf of each of the Parties to this
Agreement.


 


11.10       Entire
Agreement. This
Agreement and the applicable provisions of the Confidentiality Agreement, which
are incorporated herein and made a part hereof, together with the Exhibits and
Schedules hereto and the agreements and instruments expressly provided for
herein, constitute the entire agreement of the Parties hereto with respect to
the subject matter hereof and supersede all prior agreements and
understandings, oral and written, between the Parties hereto with respect to
the subject matter hereof.


 


11.11       Choice
of Law. [***].


 


11.12       Jurisdiction;
Venue. [***].


 


11.13       Headings. The headings of the Articles and Sections in this Agreement are
provided for convenience of reference only and shall not be deemed to
constitute a part hereof.


 


15





















 


11.14       Counterparts. This Agreement may be executed in several counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.


 


11.15       Insurance.  Without limiting or qualifying
the Joint Venture Company’s liabilities, obligations, or indemnities otherwise
assumed by the Joint Venture Company pursuant to this Agreement, the Joint
Venture Company shall maintain, at no charge to Micron, with companies
acceptable to Micron:


 


(a)           Commercial General Liability with limits of liability not less than
$[***] per occurrence and including liability coverage for bodily injury or
property damage (1) assumed in a contract or agreement pertaining to The Joint
Venture Company’s business and (2) arising out of The Joint Venture Company’s
products, Services, or work.  The Joint
Venture Company’s insurance shall be primary with respect to liabilities
assumed by The Joint Venture Company in this Agreement to the extent such
liabilities are the subject of The Joint Venture Company’s insurance, and any
applicable insurance maintained by Micron shall be excess and
non-contributing.  The above coverage
shall name Micron as additional insured as respects The Joint Venture Company’s
work or services provided to or on behalf of Micron.


 


(b)           Automobile Liability Insurance with limits of liability not less than
$[***] per accident for bodily injury or property damage.


 


(c)           Statutory Workers’ Compensation coverage, including a Broad Form All
States Endorsement in the amount required by law, and Employers’ Liability
Insurance in the amount of $[***] per occurrence.  Such insurance shall include mutual insurer’s
waiver of subrogation.


 


[Signature
page follows]


 


16





















 


IN WITNESS
WHEREOF, this Agreement has been duly executed by and on behalf of the Parties
hereto as of the Effective Date.


 


	
  MICRON TECHNOLOGY, INC.

  	
  IM FLASH TECHNOLOGIES,
  LLC

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ STEVEN R. APPLETON

  	
   

  	
  By:

  	
  /s/ DAVID A. BAGLEE

  	
   

  
	
  Name:

  	
  Steven R. Appleton

  	
  Name:

  	
  David A. Baglee

  
	
  Title:

  	
  Chief Executive Officer and President

  	
  Title: 

  	
  Authorized Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: 

  	
  /s/ RODNEY MORGAN

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Rodney Morgan

  
	
   

  	
   

  	
  Title:

  	
  Authorized Officer

  
														



 


THIS
IS THE SIGNATURE PAGE FOR THE SUPPLY AGREEMENT ENTERED INTO BY AND BETWEEN
MICRON TECHNOLOGY, INC. AND IM FLASH TECHNOLOGIES, LLC


 


17





















 


EXHIBIT A


DEFINITIONS


 


“Affiliate” means, with respect to any specified Person, a Person that directly or
indirectly, including through one or more intermediaries, controls, or is
controlled by, or is under common control with, the Person specified.


 


“Agreement” shall have the meaning set forth in the preamble to this Agreement.


 


“Applicable
Law” means any applicable laws, statutes,
rules, regulations, ordinances, orders, codes, arbitration awards, judgments,
decrees or other legal requirements of any Governmental Entity.


 


“Approved
Business Plan” shall have the
meaning set forth in the LLC Operating Agreement.


 


“Assembly Outs” shall mean a
Product for which the Assembly Services have been completed and meets all of
the Assembly Specification applicable at such time and is not Secondary Silicon
or Rejects.


 


“Boise
Supply Agreement” means that certain
Boise Supply Agreement by and between Micron and the Joint Venture Company
dated as of the Effective Date.


 


“Business
Continuity Plan” shall have the
meaning set forth in Section 2.8 hereof.


 


“Business
Day” means a day that is not a Saturday,
Sunday or other day on which commercial banking institutions in the State of
New York are authorized or required by Applicable Law to be closed.


 


“Capacity”
means the rate of output (defined in
terms of units per time period), at a particular point in time, at which a
particular Facility or set of Facilities of the Joint Venture Company (or of a
third party on the Joint Venture Company’s behalf) is capable of producing such
units.


 


“Confidential
Information”
shall have the meaning set forth in Section 7.1 hereof.


 


“Confidentiality
Agreement”
means that Mutual Confidentiality Agreement by and among the Joint Venture
Company, Intel and Micron dated as of the Effective Date.


 


“Custom
Products” shall have the meaning
set forth in the Product Designs Committee Agreement.


 


“Cycle
Time” means the time required to process a
unit through a portion of the manufacturing process (e.g., fab, assembly, or
final test) or through the manufacturing process as a whole.


 


“Demand
Forecast” shall have the
meaning set forth in Section 3.1(a) hereof.


 


“Effective
Date” shall have the meaning set forth in the
preamble to this Agreement.


 


“Excursion” means an occurrence, either during production or after customer
delivery that is outside normal historical behavior as established by both
Parties in writing in the applicable Specifications which may impact
performance, Quality and Reliability, or customer delivery commitments for
Probed Wafers, NAND Flash Memory Product or Known Good Die.


 


18





















 


“Facilities” shall mean all of the Joint Venture Company’s facilities at which it
may perform manufacturing, assembly or test services, including subcontractors.


 


“Fiscal Quarter”
means any of the four financial accounting quarters within the Joint Venture
Company’s Fiscal Year.


 


“Fiscal Month” means any of
the twelve financial accounting months within the Joint Venture Company’s
Fiscal Year.


 


“Fiscal Year”
means the fiscal year of the Joint Venture Company for financial accounting
purposes.


 


“Flash
Memory Integrated Circuit”
shall have the meaning set forth in the LLC Operating Agreement.


 


“Force
Majeure Event” shall have the
meaning set forth in Section 11.1.


 


“GAAP” means United States generally accepted accounting principles as in
effect from time to time.


 


“Governmental
Entity” means any governmental authority or
entity, including any agency, board, bureau, commission, court, department,
subdivision or instrumentality thereof, or any arbitrator or arbitration panel.


 


“Hazardous
Materials” means dangerous
goods, chemicals, contaminants, substances, pollutants or any other materials
that are defined as hazardous by relevant local, state, national, or
international law, regulations and standards.


 


“Indemnified
Party” shall
mean any of the following to the extent entitled to seek indemnification under
this Agreement: Micron, the Joint Venture Company, and their respective
Affiliates, officers, directors, employees, agents, assigns and successors.


 


“Indemnified Losses” shall
mean all direct, out-of-pocket liabilities, damages, losses, costs and expenses
of any nature incurred by an Indemnified Party, including reasonable attorneys’
fees and consultants’ fees, and all damages, fines, penalties and judgments
awarded or entered against an Indemnified Party, but specifically excluding any
special, consequential or other types of indirect damages.


 


“Indemnifying Party”
shall mean the Party owing a duty of indemnification to another Party with
respect to a particular Third Party Claim.


 


“Intel” means Intel Corporation, a Delaware Corporation.


 


“Initial
Business Plan” shall have the
meaning set forth in the LLC Operating Agreement.


 


“Joint
Development Program Agreement”
means that certain Joint Development by and between Intel and Micron dated as
of the Effective Date.


 


“Joint
Venture Company” shall have the
meaning set forth in the preamble to this Agreement.


 


“Joint
Venture Documents” shall have the meaning set forth in
the Master Agreement.


 


“Known Good Die” means a raw wafer that has been processed to
the point of containing functional and/or operational NAND Flash Memory
Integrated Circuits that has undergone Probe Testing (a.k.a. “Sort” procedure),
meeting predefined performance and quality criteria and singulated to


 


19





















 


individual
semiconductor die.  Die will have been
fully tested but will not been assembled into final packaging or undergone
final product testing.


 


“LLC
Operating Agreement” means that Limited
Liability Company Operating Agreement of the Joint Venture Company, LLC
between, Intel and Micron.


 


“Liquidation
Date” shall have the meaning set forth in the
LLC Operating Agreement.


 


“Liquidation
Event” shall have the meaning set forth in the
LLC Operating Agreement.


 


“Losses” shall mean, collectively, any and all insurable liabilities, damages,
losses, costs and expenses (including reasonable attorneys’ and consultants’
fees and expenses).


 


“Manufacturing
Committee” shall have the
meaning set forth in the LLC Operating Agreement.


 


“Master
Agreement” means that certain
Master Agreement by and between Intel and Micron as defined in the LLC
Operating Agreement.


 


“Members” means Micron and Intel.


 


“Micron” shall have the meaning set forth in the preamble to this Agreement.


 


“Minority
Closing” shall have the
meaning set forth in the LLC Operating Agreement.


 


“Modified
GAAP” shall have the meaning set forth in the
LLC Operating Agreement.


 


“MTV
Lease Agreement” means that certain
MTV Lease Agreement by and between the Joint Venture Company and Micron dated
as of the Effective Date.


 


“NAND
Flash Memory Integrated Circuit” means a Flash Memory
Integrated Circuit, in the memory cells included in the Flash Memory Integrated
Circuit are arranged in groups of serially connected memory cells (each such
group of serially connected memory cells called a “string”) in which the drain
of each memory cell of a string (other than the first memory cell in the
string) is connected in series to the source of another memory cell in such string,
the gate of each memory cell in such string is directly accessible, and the
drain of the uppermost bit of such string is coupled to the bitline of the
memory array.


 


“NAND Flash Memory Product”
shall have the meaning set forth in the LLC Operating Agreement.


 


“NAND
Flash Memory Wafer” means a raw wafer
that has been processed to the point of containing NAND Flash Memory Integrated
Circuits organized in multiple semiconductor die and that has undergone Probe
Testing, but before singulation of said die into individual semiconductor die.


 


“Operating
Plan” means the Manufacturing Plan, Assembly
Plan and Testing Plan developed pursuant to the Definitions in the LLC
Operating Agreement.


 


“Optional
Purchase Agreement” means that certain
Optional Purchase Agreement dated as of the Effective Date.


 


“Party” and “Parties” shall have the meaning
set forth in the Recitals to this Agreement.


 


20





















 


“Performance
Criteria” means [***].


 


“Person” shall have the meaning set forth in the LLC Operating Agreement.


 


“Planning
Forecast”
shall have the meaning set forth in Section 3.1(b) hereof.


 


“Price”
or “Pricing” means the calculation set
forth on Schedule 4.8 hereof.


 


“Prime
Wafer” means the raw silicon wafers required,
on a product-by-product basis, for the manufacturer.


 


“Probe Testing” means testing, using a wafer test program as
set forth in the applicable Specifications, of a wafer that has completed all
processing steps deemed necessary to complete the creation of the desired NAND
Flash Memory Integrated Circuits in the die on such wafer, the purpose of which
test is to determine how many and which of the die meet the applicable criteria
for such die set forth in the Specifications.


 


“Probed
Wafer” means a Prime Wafer that has been
processed to the point of containing NAND Flash Memory Integrated Circuits
organized in multiple semiconductor die and that has undergone Probe Testing,
but before singulation of said die into individual semiconductor dice.


 


“Product
Designs Committee Agreement”
means that certain Product Designs Committee Agreement by and between Micron
and the Joint Venture Company dated as of the Effective Date.


 


“Product
Designs Development Agreement”
means that certain Product Designs Development Agreement by and between Micron
and the Joint Venture Company dated as of the Effective Date.


 


“Products” means a Probed Wafer, Known Good Die, or NAND Flash Memory Product, or
such other products that are manufactured by the Joint Venture Company under
Section 2.2 hereof.


 


“Proposed Loading Plan”
shall have the meaning set forth in Section 3.1 hereof.


 


“Purchase
Order” shall have the meaning set forth in
Section 4.3 hereof.


 


“Quality
and Reliability” or “Q&R” means building and sustaining relationships which
assess, anticipate, and fulfill the quality and reliability standards as set
forth in the Specification or Operating Plan for Products.


 


“Ramp
Plan” means the document which defines the
process and key milestone schedule to build and ramp a silicon fabrication facility.


 


“Receiving
Party” shall have the meaning set forth in
Section 7.1 hereof.


 


“Recoverable Taxes”
shall have the meaning set forth in Section 4.7 hereof.


 


“Secondary Silicon”
shall mean: (i) a Prime Wafer that has been processed to the point of containing
NAND Flash Memory Integrated Circuits organized in multiple semiconductor die
and that has undergone Probe Testing would otherwise constitute a Probed Wafer
but for failure to achieve 


 


21





















 


qualification; or (ii) singulated and/or
packaged die that would otherwise constitute Assembly Outs or Test Outs but for
failure to achieve qualification; and otherwise conform to the applicable
Secondary Silicon Specification.


 


“Semiconductor
Manufacturing Technology” shall have the meaning set
forth in the Process Joint Development Program Agreement.


 


“Sharing
Interest” shall have the
meaning set forth in the LLC Operating Agreement.


 


“Specifications” means those specifications used to describe, characterize, and define
the quality and performance of NAND Flash Memory Products and Known Good Die,
including any interim performance specifications at Probe Testing or other
testing, as such specifications may be determined from time to time by the
Joint Venture Company.


 


“Subsidiary”
shall have the meaning set forth in the
LLC Operating Agreement.


 


“Technology
License Agreement” means that certain
Technology License Agreement by and between Intel, Micron and the Joint Venture
Company dated as of the Effective Date.


 


“Term” shall have the meaning set forth in Section 11.1 hereof.


 


“Test Outs” shall mean a Product Candidate for which Testing Services
have been completed and meets all of the Testing Specification applicable at
such time and is not Secondary Silicon or Rejects.


 


“Third
Party Claim” shall mean any
claim, demand, action, suit or proceeding, and any actual or threatened
lawsuit, complaint, cross-complaint or counter-complaint, arbitration or other
legal or arbitral proceeding of any nature, brought in any court, tribunal or
judicial forum anywhere in the world, regardless of the manner in which such
proceeding is captioned or styled, by any Person other than Micron, the Joint
Venture Company and Affiliates of the foregoing, against an Indemnified Party,
in each case alleging entitlement to any Indemnified Losses pursuant to any
indemnification obligation under this Agreement.


 


“Under-loading” shall have the meaning set forth in Section 4.1.


 


“Wafer Start” shall mean the
initiation of Manufacturing Services with respect to a Prime Wafer.


 


“Warranty
Claim Period” shall have the
meaning set forth in Section 6.2 hereof.


 


“Wholly-Owned
Subsidiary” shall have the
meaning set forth in the LLC Operating Agreement.


 


“WIP” means work in process.  This
includes all wafers and Product in wafer fabrication, sort, assembly, and/or
final test, including prime and secondary wafers, and all completed Product
units not yet delivered to Micron.


 


“Yield” means anticipated output of Product from WIP at a particular point in
time, including line yield, die yield, assembly yield and final testing yield.


 


22





















 


SCHEDULES


 




	
  Schedule 4.8

  	
   

  	
  Price

  






 


23