**Exhibit10.5**

 

**CERTAIN INFORMATION (INDICATED BY “[***]”) IN THIS EXHIBITHAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGECOMMISSION.  CONFIDENTIAL TREATMENT HASBEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.**

 

TOSHIBA

 

ToshibaAmerica Electronic Components, Inc.

2950Orchard Parkway, San Jose, CA 95131

 

**Designand Production Agreement**

 

**Amendment#1**

 

**NetlistInc.**

 

This Amendment #1 (“Amendment”) to theRegister ASIC Design and Production Agreement, dated July 31, 2008,(TAEC#27N1242613) (“Agreement”) is between Toshiba America ElectronicComponents, Inc., with a principal place of business at 19900 MacArthurBoulevard, Suite 400, Irvine, CA 92612 (“TAEC”) and Netlist Inc. with aplace of business at 51 Discovery, Suite 150 Irvine, CA 92618 (“Customer”)and sets out the terms and conditions under which TAEC will design the productidentified herein for Customer. This Amendment is effective as of the datefinally executed below (“Effective Date”).

 

**1.****            ****ProjectName**

 

Register ASIC

 

**2.****            ****NewSchedule**

 

The parties agree to delete the contents of Section 4of the Agreement, Schedule, and replace it with the following:

 

**Major Project Milestones**

 
| **Event**                                       | ** ** | **Target Date/Completed** |
|-------------------------------------------------|------------|--------------------------------|
| Development  PO Released                        | ** ** | **[***]**                      |
| Preliminary  Feasibility Study                  | ** ** | **[***]**                      |
| Design  Decision                                | ** ** | **[***]**                      |
| Design  Initiation                              | ** ** | **[***]**                      |
| Package  Selection Finalized                    | ** ** | **[***]**                      |
| Early  RTL for Pipecleaning                     | ** ** | **[***]**                      |
| Final  RTL (functionally correct)               | ** ** | **[***]**                      |
| Tapeout  — Second Signoff (GDSII transfer) | ** ** | **[***]**                      |
| Delivery  of Prototypes                         |       | TBD                            |
| System  compliance phase - start                |       | TBD                            |
| System  compliance phase - complete             |       | TBD                            |
| 1st  Risk Production shipment                   |       | TBD                            |

 

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Productionturnaround time: 16 working weeks.

 

Scheduleis provisional.

 

**3.****            ****NewPackage and Die Size Option**

 

The parties agree to delete the contents of Section 6of the Agreement, Package and Die Size Option, and replace it with thefollowing:

 
| **Package** | ** ** | **Ball Pitch** | ** ** | **Body Size** | ** ** | **Substrate Layers** | ** ** | **Die Size** |
|-------------|------------|----------------|------------|---------------|------------|----------------------|------------|--------------|
|        |       |           |       |          |       |                 |       |         |
| **[***]**   |       | **[***]**      |       | **[***]**     |       | **[***]**            |       | **[***]**    |

 

**4.****            ****NewPrice**

 

The parties agree to delete the contents of Section 8of the Agreement, Price, and replace it with the following:

 
| First        |   | 1M  pieces: |   | US$**[***]** |   | ***[***]** |
|--------------|--------|-------------|--------|--------------|--------|------------|
| Next         |   | 2M  pieces: |   | US$**[***]** |   |       |
| Next         |   | 2M  pieces: |   | US$**[***]** |   |       |
| After  first |   | 5M  pieces: |   | US$**[***]** |   |       |

 

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*Prices for first 1 Mpcs represent an addition of US$**[***]**per unit in amortized Total NRE cost. See Section 10.

 

Changesin die size will affect the price quoted.

 

Theprices quoted herein for mass production are based on the assumption ofadequate yield. TAEC reserves the right to adjust pricing based on mutualagreement in the event that adequate yield figures, in TAEC’s reasonableopinion, are not achieved by the start of mass production despite reasonablecommercial efforts by both parties. TAEC will provide Netlist with timely datasuch that Netlist can reasonably assess yield.

 

Pricesdo not include and are subject to any applicable sales tax.

 

**5.****            ****NewEngineering Sample and Risk Production Pricing**

 

The parties agree to delete Section 13.3of the Agreement. The parties agree to delete the contents of Section 12of the Agreement, Extra Engineering Samples, and replace it with the following:

 

Allextra engineering samples and Risk Production parts shall be sold at US$**[***]** each (2X the unit price of US**[***]**).

 

----

 

Allextra engineering samples are sold as Prototypes and are subject to, withoutlimitation, Articles 18.2 and 19.1 of the Design and Production Agreement Termsand Conditions (“Terms and Conditions”). All Risk Production parts are subjectto, without limitation, Articles 18.2 and 19.2 of the Terms and Conditions.TAEC reserves the right in its sole discretion to determine whether to acceptextra engineering sample or Risk Production orders.

 

**6.****            ****AdditionalNon-Recurring Engineering Charges and Payment Schedule**

 

Customer agrees to pay additionalnon-recurring engineering charges of US$**[***]** (“AdditionalNRE”) to TAEC for design support. The Additional NRE will be due and payable asfollows:

 

1.             US$**[***]** upon Tapeout.

 

2.             US$**[***]** upon Delivery of Prototypes together with test logsshowing successful completion of the mutually agreed-upon tests.

 

For the avoidance of doubt, the AdditionalNRE payable under this Amendment is in addition to and does not replace the NREpayable under the Agreement.

 

**7.****            ****Cancellation**

 

7.1           If Customer wishes to discontinue the project afterexecution of this Amendment, then in addition to the provisions set Forth in Section 10of the Terms and Conditions, the Customer shall be responsible to pay TAEC forthe NRE charges as set forth below (“Additional Cancellation Fee”), unlessotherwise agreed in writing between TAEC and the Customer:

 
| **Time**  | ** ** | **Additional Cancellation Fee** |
|-----------|------------|---------------------------------|
| **[***]** | ** ** | **[***]**% of  Additional NRE   |
| **[***]** | ** ** | **[***]**% of  Additional NRE   |
| **[***]** | ** ** | **[***]**% of  Additional NRE   |

 

7.2           For the avoidance of doubt, NRE already invoiced toCustomer per the milestones and NRE payment schedule set forth herein and inthe DPA (“Paid NRE”) shall offset the Additional Cancellation Fee assessed in Article 7.1above. To the extent that the Paid NRE exceeds the Additional Cancellation Feeand the Cancellation Fee set forth in Section 10 of the Terms andConditions of the Agreement, TAEC shall not charge further AdditionalCancellation Fee; however, Paid NRE will not be refunded upon cancellation ofthe design.

** **

**8.****            ****AdditionalTerms**

 

8.1           **[***]**

 

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Except as modified herein, all other termsand conditions of the Agreement shall remain in full force and effect per theirterms.

 
| **Toshiba  America Electronic Components, Inc.** |       | **NetList  Inc.**       |
|-------------------------------------------------------|------------|-------------------------|
| ** **                                            |       | ** **              |
| ** **                                            | ** ** | ** **              |
| */s/  Takeshi Iwamoto*                                |       | */s/  Gail Itow*        |
| Signature                                             | ** ** | Signature               |
| ** **                                            | ** ** | ** **              |
| ** **                                            | ** ** | Gail  Itow, CFO         |
| Takeshi  Iwamoto VP, Customer SoC &          | ** ** | Printed  Name and Title |
| Foundry  Business Unit                                | ** ** | ** **              |
| Printed  Name and Title                               | ** ** | 1-28-10                 |
| ** **                                            | ** ** | Date                    |
| ** **                                            | ** ** | ** **              |
| 1-28-10                                               | ** ** | ** **              |
| Date                                                  | ** ** | ** **              |

 

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