Ex-4.11.16 Joint Development Project Agreement



 





Exhibit 4.11.16




Confidential Treatment Requested

The portions of this document marked by “XXXXXX” have been omitted pursuant to a request for confidential

treatment and have been filed separately with the Securities and Exchange Commission




			
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JOINT DEVELOPMENT PROJECT AGREEMENT




for




32nm BULK-INDUSTRY STANDARD SEMICONDUCTOR PROCESS TECHNOLOGY




with




INTERNATIONAL BUSINESS MACHINES CORP.




dated




DECEMBER 15, 2006




	 	 	 
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This Joint Development Project Agreement for 32nm Bulk-Industry Standard Semiconductor Process
Technology (“Project Agreement”) is made effective as of December 15, 2006 (the “Effective Date”)
by and between International Business Machines Corporation (“IBM”), incorporated under the laws of
the State of New York, U.S.A. and having an office for the transaction of business at 2070 Route
52, Hopewell Junction, NY 12533, U.S.A, and all Participating Parties.



WHEREAS, IBM has developed and continues to develop leading edge semiconductor manufacturing
processes technology and wishes to continue and/or expand such technology development in
conjunction with the Participating Parties;



WHEREAS, the Participating Parties seek to undertake such technology development with each other
and with IBM based upon the terms and conditions provided in this Project Agreement (including the
Master Terms);



WHEREAS, each Participating Party and IBM will also supplement this Project Agreement (including
the Master Terms) by executing a Participation Agreement that provides certain supplemental terms
and conditions that only govern between IBM and such Participating Party; and



WHEREAS, through the use of complementary skills and know-how the Parties desire to achieve
resource efficiencies and cost savings, and reduce the technical risk associated with the
development of the subject technology in order to complete development of and utilize leading edge
technologies sooner than would be possible with any of the Parties acting independently.



NOW THEREFORE, in consideration of the premises and mutual covenants contained herein, as well as
for other good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parties agree as follows.



1. Additional Definitions. Unless expressly defined and used with an initial capital
letter in the Master Terms (as defined below) or the rest of this Project Agreement, words shall
have their normally accepted meanings. The following terms shall have the meanings ascribed to
them:




“Background Know-How Exclusions” is defined in Section 4(b).



“Bulk CMOS” means CMOS semiconductor manufacturing technology carried out on a wafer that is not an
SOI Wafer.



“Bulk CMOS Integrated Circuit” means an Integrated Circuit fabricated utilizing a Bulk CMOS
manufacturing process.



“Chip Design(s)” means any design of one or more Integrated Circuits and/or Semiconductor Products,
including (by way of example and not limitation) random access memory (RAM)s, read only
memory (ROM)s, microprocessors, application specific Integrated Circuits (ASICs) and other logic
designs, and analog circuitry; provided,




	 	 	 
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however, that “Chip Designs” shall not include (i) alignment marks or test structures and
associated layout and data used in the Development Projects for process development, (ii) process
kerf test structures, layout, and data of the test chip(s) (including SRAM or ROM macro cells) as
well as such test chips themselves used for the development work of the Development Projects
unless any of the foregoing items are specifically excluded (for clarity, to “specifically exclude”
such an item means it is included in the definition of Chip Design), or (iii) other product designs
as mutually agreed by the Parties to be used as qualification vehicles in the Development Projects
unless specifically excluded (for clarity, to “specifically exclude” a product design means it is
included in the definition of Chip Design), or (iv) ESD protection devices as used in the
project Test Sites and ESD groundrules and models as defined in the Documentation. For the
avoidance of doubt, all of (i) through (iv) above shall be treated as Specific Results to the
extent utilized in a Development Project.



“32nm Bulk CMOS” also known as “32nm Industry Standard CMOS” means the next major lithography
generation Bulk CMOS logic fabrication process technology for 300mm wafers below 45nm, with the
target objectives set forth in Exhibit A, attached hereto.



“Development Project” means the technology development project and any sub-projects identified in
Exhibit A to this Project Agreement.



“Effective Date” means the date set forth in the preamble of this Project Agreement.



“L1” means yield, process and reliability demonstration on an integrated process Test Site (all
JEDEC qualification tests & preliminary functional stress). Qualification criteria will be
mutually reviewed for consistency with application requirements. Reliability stresses are as per
industry standard criteria and specifications.



“Mask Fabrication and Photoresist Technology” means any process, procedure, Proprietary Tools,
Third Party tools, or hardware tool used in the fabrication of photomasks, as well as the
photomasks themselves, and/or the formulation and/or manufacture of photoresist; provided, however,
that “Mask Fabrication and Photoresist Technology” shall not include Lithography.



“Master Terms” means the Master IBM Joint Development Terms and Conditions December 15, 2006
version.



“Manufacturing Apparatus” means semiconductor wafer fabrication equipment, flat-panel display
fabrication equipment and wafer inspection equipment or components primarily designed for use in
such equipment, including, without limitation, software, firmware, microcode or drivers used to
cause such equipment to perform its intended function, whether or not such software, firmware,
microcode, or drivers are shipped with such equipment or installed separately. “Participating Party
Qualification” also known as the “Participating Party L2” means the successful completion of
foundry standard stress on a product and/or a product like vehicle with mixed signal, digital, and
SRAM elements




	 	 	 
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and with manufacturing process routing defined, in the Participating Party’s manufacturing facility
for 300mm Wafers.



“Party” means IBM and each Participating Party in the Development Project.



“Project Agreement” means the terms and conditions of this Joint Development Project Agreement for
32nm Bulk-Industry Standard Semiconductor Process Technology dated December 15, 2006, together with
(i) any exhibits, attachments and appendices hereto, and (ii) the “Participating Party
Notification” for each Participating Party.



“Project Term” is defined in Section 6.



“Qualification” also known as “L2” and means the successful completion of foundry standard stress
(i.e. a stress which is based upon industry standard criteria and specifications) on a product
and/or a product like vehicle with mixed signal, digital, and SRAM elements and with manufacturing
process routing defined, in the IBM manufacturing line for 300mm Wafers and consistent with the
Strategic Technology Objectives as set forth in Exhibit A.



“Silicon-Germanium Technology” or “SiGe Technology” means semiconductor fabrication processes and
design techniques incorporating silicon and germanium layers, including those processes and design
techniques for use in HEMTs, photodetectors, HBTs or any other applications of bipolar transistors,
provided, however, “SiGe Technology” shall not include strained silicon channel MOSFET or any
mobility enhancement techniques for FETs carried out on high performance Integrated Circuit wafers.



“Silicon-On-Insulator Wafer” or “SOI Wafer” means a single-crystal silicon wafer bearing a
horizontally-disposed isolating silicon dioxide (SiO2) layer, in turn bearing
a single-crystal silicon layer or a polysilicon layer, which is separated from the underlying
silicon by the silicon dioxide layer and in which one or more active or passive integrated circuit
structures are formed.



“SOI Information” means any and all process methods, steps, and structures created on SOI Wafers
and not on Bulk CMOS Integrated Circuits.



“Specific Results Exclusions” is defined in Section 3(a).



2. IBM Development Facilities; Agreement Structure; Relationship to Other Documents.




(a) The Parties shall primarily utilize the IBM Development Facilities for the Development Project.



(b) The terms and conditions of the Master Terms are incorporated into this Project Agreement by
reference as if fully set forth herein.




	 	 	 
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(c) IBM shall promptly notify existing Participating Parties of the addition of a new Participating
Party to and the withdrawal/ removal of an existing Participating Party from the Development
Project. In the case of a new Participating Party, IBM shall complete such notification by
distributing copies of the signed “Participating Party Notification”, which provides certain
details about the new Participating Party (e.g. the first day of its participation, Designated
Executive, Project Leader and Notice Addresses), and memorializes the new Participating Party’s
contractual privity with the other Participating Parties.



(d) The Party’s respective ownership, disclosure, and/or license rights as to the Specific Results
and Background Know-How are set forth in that Party’s Participation Agreement and this Project
Agreement (including the Master Terms).



(e) For the Development Project, the Parties will strive to utilize consumables (including, but not
limited to, photoresist) in the Development Project that will be available to the Parties from
commercial suppliers. However, if a consumable proposed by IBM is an IBM proprietary consumable,
the IBM Project Leader will notify the Participating Parties of such proposed selection, specifying
the respects in which the consumable is IBM proprietary. In addition, within thirty (30) days of
such proposed selection IBM will inform the Third Party supplier of such IBM proprietary consumable
that if such supplier is chosen by IBM, such supplier may provide such proprietary consumable to
the Participating Parties irrespective of any IBM imposed restriction or proprietary rights that
might otherwise exist. If such supplier refuses to sell the proprietary consumable to
Participating Parties or IBM and the Participating Parties reasonably believe that such supplier
will not sell to Participating Parties, then IBM shall either enable Participating Parties to
purchase such consumable from another source or select another consumable prior to the applicable
Qualification.




			
	3.	 	Scope of Development Project.





(a) As part of the Development Project, the Parties shall jointly develop semiconductor
manufacturing process technology based on an industry standard technology roadmap that meets the
requirements set forth as “Strategic Technology Objectives” in Exhibit A in accordance with the
schedule set forth on Exhibit B (the “Development Schedule”). The Parties shall create the
Documentation identified on Exhibit C for the Development Project. For the avoidance of doubt, the
Development Project shall not include the development of the following “Specific Results
Exclusions”: i) Proprietary Tools, ii) Packaging Technology, iii) Mask Fabrication and Photoresist
Technology, iv) Memory, v) SiGe Technology, vi) SOI Information, and vii) Chip Designs. The
Parties are not obligated to exchange any updates to the Specific Results after the Project Term.



(b) The Parties agree that Exhibit A also sets forth the current, as of the Effective Date,
technology implementation options for the Development Project. The Parties shall work together to
evaluate the various options available, including individual Process Module feasibility,
integration, characterization, and qualification. The goal of such evaluation is to agree on an
integrated process technology that meets the Strategic Technology




	 	 	 
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Objectives. If the Project Leaders are unable to agree on a particular Process Module to be
developed, or should they disagree as to continued development of a Process Module that was
previously selected, the Process Module preferred by IBM shall be pursued in the Development
Project, provided it is consistent with foundry industry marketplace requirements and the standard
baseline Bulk CMOS process for such fabrication process generation. Any Participating Party may
escalate the failure to agree through the procedures set forth in Section 18.3 of the Master Terms.
In the event that a Party proposes a Process Module or replacement Process Module that does not
get selected after escalation, then such Party shall have the right, subject to the remaining terms
and conditions of the Agreement, to proceed with such development outside the performance of the
Development Projects.




			
	4.	 	Information Transfers.





(a) As referenced in Section 7.3 of the Master Terms, the “Confidentiality Period” is from the
Effective Date until XXXXXX after the date set forth on Exhibit B (as of the Effective Date) for
the applicable Qualification.



(b) As referenced in the Master Terms, the “Background Know How Exclusions” for purposes of the
Development Project are: i) Proprietary Tools, ii) Packaging Technology, iii) Mask Fabrication and
Photoresist Technology, iv) Memory, v) SiGe Technology, vi) SOI Information, and vii) Chip Designs.



(c) In addition to the disclosure rights of a Participating Party pursuant to Section 7 and license
rights in Section 8 of the Master Terms, each Participating Party has the following rights to
disclose portions of Specific Results and/or Background Know-How, solely for the purpose of
exercising its rights under the Agreement:




		 	1. To contractors, suppliers, and consultants (and, for clarity, Subsidiaries of such
Participating Party acting in any of the foregoing capacities) as may be reasonably necessary
for Participating Party to manufacture Integrated Circuits and Semiconductor Products. By way
of example and not limitation, examples of the general types of information the Parties agree
are “reasonably necessary” for disclosure to such contractors, suppliers, and consultants are
as follows:
	 
	 	 	          XXXXXX
	 
		 	2. To customers (including companies providing design services to such customers), library/IP
creators, Electronic Design Automation (“EDA”) vendors, consultants (such consultants including
design service providers, integrated circuit designers, and external subcontractors), (and, for
clarity, Subsidiaries of a Participating Party acting in any of the foregoing capacities)
(collectively, “Customers/Designers”) as may be reasonably necessary to enable the design and
sale of Integrated Circuits or Semiconductor Products to such customers by Participating Party.
By way of example and not limitation, examples of the general types of information the Parties







	 	 	 
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	 	 	agree are “reasonably necessary” for disclosure to some or all Customers/Designers are as
follows:
	 
	 	 	          XXXXXX
	 
	 	 	This Section 4(c)2 also includes the right to sublicense (as set forth in Section 8.5 of the
Master Terms) to EDA vendors and circuit design or library providers where such sublicense is
for the benefit of the Participating Party’s foundry business in connection with the
manufacture and sale of wafers containing Integrated Circuits, acknowledging that such Third
Parties may license for their own benefit the resultant EDA software and/or cores or IP blocks
to Customers/Designers.
	 
	 	 	This Section 4(c)2 also includes the right to disclose to a Participating Party’s customers as
may be reasonably necessary, solely for the purpose of enabling the Participating Party to
develop Derivative Technology for the manufacture of Integrated Circuits or Semiconductor
Products solely for such customer and to manufacture Integrated Circuits or Semiconductor
Products for such customer. The resultant Derivative Technology may be used by the
Participating Party to manufacture Integrated Circuits or Semiconductor Products for future
customers, but such future customers will not get any access to any of the Specific Results
and/or Background Know-How, except as otherwise set forth in this Section 4.





Disclosures pursuant to this Section 4(c) will not be made without a written agreement between the
Participating Party and the recipient Third Party. Such written agreements shall be subject to the
following:




	 	(a)	 	such agreements must obligate the recipient to utilize the disclosed
information solely for the benefit of the discloser and for no other purpose, and
solely in furtherance of the purposes set forth in this Section 4; and
	 
	 	(b)	 	such disclosures shall be subject to confidentiality terms and conditions
that are the same or substantially similar to those set forth in this Agreement, and
at a minimum must have a confidentiality term that is no shorter than XXXXXX.






			
	5.	 	Tool Vendor Confidential Information. 





Notwithstanding anything to the contrary in Section 4 of this Project Agreement, Section 3.6 of the
Master Terms or the rest of the Agreement, the Parties recognize that IBM is working with certain
Third Party tool vendors to develop, among other things, Background Know-How which may include
Third Party tool vendor confidential information (“Tool Vendor Confidential Information”), and
agree that (a) IBM may elect to introduce certain Tool Vendor Confidential Information into the
Development Project as Background Know-How, and (b) the Specific Results may include such Tool
Vendor Confidential Information. If IBM elects to so introduce such Tool Vendor Confidential




	 	 	 
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Information, IBM shall identify such information and the following terms apply to such information:



Each Participating Party is authorized to disclose or sublicense to any of its business units
and/or Subsidiaries the Tool Vendor Confidential Information; provided, however, that such business
unit and/or Subsidiary is not in a business, nor has announced plans to be in, or to acquire, a
business that manufactures, sells, or distributes Manufacturing Apparatus. If Participating Party
wishes to obtain additional license rights to such Tool Vendor Confidential Information, then
Participating Party must negotiate additional rights with such Third Party tool vendor. The
obligations of confidentiality with respect to any disclosure to a Participating Party pursuant to
this Section 5 shall terminate ten (10) years after disclosure by IBM, unless otherwise agreed in
writing between such Third Party and the Participating Party, with written notification to IBM.
Participating Party shall require that each such business unit and/or Subsidiary agree to maintain
such Tool Vendor Confidential Information confidential on terms at least as restrictive as
contained in this Agreement including this Section 5.



6. Project Term and Termination.



(a) This Project Agreement is in effect from the Effective Date and, unless terminated as set forth
in the Agreement (including Section 12 of the Master Terms), remains in force until XXXXXX (the
“Project Term”); provided, however, the Management Committee may extend the Project Term until
XXXXXX in accordance with Section 18.15 of the Master Terms without the need for the Parties to
execute a written amendment to this Project Agreement. For clarity, a Participating Party may, as
specified in its Participation Agreement, participate in the Development Project for all or a
portion of the Project Term.



(b) The Project Term may only be extended beyond XXXXXX (i) as to all Parties, by the mutual
agreement of all Parties, or (ii) as to certain Parties, by mutual agreement of such Parties. Each
Party who agrees to extend the Project Term beyond XXXXXX shall memorialize its agreement to
participate in such extensions by amending its Participation Agreement with IBM. IBM shall update
the Project Database to reflect such Project Term extension.



(c) The following Sections of this Project Agreement survive and continue to bind the Parties and
their legal representatives, successors and assigns after the expiration or termination of this
Project Agreement: 1, 2(b), 2(d), 4, 5, 6(c), 6(d) and 8. In addition, certain provisions of the
Master Terms and a Participating Party’s Participation Agreement survive, as detailed in each
agreement, respectively.



(d) Notwithstanding any provision in this Project Agreement to the contrary, if a non-breaching
Party is authorized to terminate all licenses and disclosure rights granted to a breaching Party
pursuant to Section 12.6 of the Master Terms, then such non-breaching




	 	 	 
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Party is also authorized to terminate all license and disclosure rights it granted to that
breaching party pursuant to Section 4 of this Project Agreement.



7. Management of the Development Project; Notice. Each Participating Party shall promptly
provide a Management Committee Member, a Project Leader, a Technical Coordinator, a Designated
Executive, and a Notice Address for the Development Project.




The IBM Management Committee Member, IBM Project Leader, IBM Technical Coordinator, Designated
Executive, and the Notice Address are as follows:



          XXXXXX



Any Party may change its respective appointments and addresses by written notice to the IBM Project
Leader who will update the Project Database within seven (7) business days after notification. No
such change is effective until reflected in the Project Database .



8. Limitation Amount. As referenced in Section 17 (Limitation of Liability) of the
Master Terms, the Limitation Amount for this Development Project is XXXXXX.



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IN WITNESS WHEREOF, IBM has caused this Project Agreement to be executed by its duly authorized
representatives as of the Effective Date, signifying its agreement to this Project Agreement with
all Participating Parties.



International Business Machines Corporation




By: /s/Adalio T. Sanchez

Name: Adalio T. Sanchez

Title: GM Technology Collaboration Solutions




Date:12/15/06





	 	 	 
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EXHIBIT A: TECHNICAL OBJECTIVES




EXHIBIT B: DEVELOPMENT SCHEDULE




EXHIBIT C: DOCUMENTATION




	 	 	 
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EXHIBIT A




TECHNICAL OBJECTIVES




XXXXXX 





	 	 	 
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EXHIBIT B




DEVELOPMENT SCHEDULE




XXXXXX




	 	 	 
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EXHIBIT C




DOCUMENTATION




XXXXXX




	 	 	 
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