Document:

exv10w9

Exhibit 10.9

	 	 	This Technology Licence Agreement (the “Agreement”) is made the 16th day of December 1996
	 
	 	 	BETWEEN
	 
	 	 	ADVANCED RISC MACHINES LIMITED whose registered office is situated at 90, Fulbourn Road,
Cherry Hinton, Cambridge CBI 4JN, England (“ARM”)
	 
	 	 	and
	 
	 	 	LG SEMICON COMPANY LIMITED whose principal place of business is situated at 16
Woomyeon-dong. Seocho-gu. Seoul 137-140, Korea (“LGS”).
	 
	 	 	WHEREAS
	 
	 	 	LGS has requested ARM and ARM has agreed, to license LGS to manufacture and distribute
certain ARM products and thereby to make use of certain portions of the Intellectual Property
(as defined below) upon the terms set out in this Agreement.
	 
	 	 	In consideration of the mutual representations, warranties, covenants, and other terms
and conditions contained herein, the parties agree as follows:
	 
	1.	 	Definitions
	 
	1.1	 	“ARM Compliant Product” shall mean any single silicon chip
developed by LGS which contains, at a minimum: (i) an ARM7TDMI
Core; or (ii) a Modified ARM7TDMI Core, which has been verified
in accordance with the provisions of Clause 3.
	 
	1.2	 	“ARM7TDMI Core” shall mean the device as described and identified
in the ARM7TDMI datasheet identified in Schedule 2 Part A Item
A1.
	 
	1.3	 	“ARM Instruction Set” shall mean both the ARM Instruction Set and
THUMB Instruction Set as each are defined in the ARM Architecture
and Reference Manual identified in Schedule 2 Part A Item A2.
	 
	1.4	 	“Authorised Distributor” shall mean those distributors appointed, in writing, by LGS.
	 
	1.5	 	“AVS” shall mean the ARM Architectural Validation Suite in binary
code format Schedule 2 Part B Section 2 Item T3.
	 
	1.6	 	“Confidential Information” shall mean: (i) any trade secrets
relating to the ARM7TDMI Core and Transfer Materials and the
source code for any Software; (ii) any information designated in
writing by either party as confidential which if disclosed
verbally is reduced to writing within thirty (30) days after its
oral disclosure; and (iii) the terms and conditions of this
Agreement.
	 
	1.7	 	“Core Functional Test Vectors” shall mean the test vectors
identified in Schedule 2 Part A Items B10, B11, B12 and B13.
	 
	1.8	 	“Design Win Event” shall mean for each different Design Win
Product, the point in time of the sale, supply or other
distribution of five hundred (500) units of such product.
	 
	1.9	 	“Design Win Product” shall mean an application specific product
made by LGS, an LG Affiliate or LG Group Company, which
incorporates an ARM Compliant Product.

Page 1

 

			
	[*****] 	 -	 Portions of this exhibit are subject to a request for confidential treatment and
have been redacted and filed separately with the Securities and Exchange Commission.

 

	1.10	 	“Effective Date” shall mean the date of this Agreement or the
date upon which the Korean Government gives approval to this
Agreement, whichever is the later, subject always to the
provisions of Clause 18.4.
	 
	1.11	 	“Embedded ICE” shall mean the Embedded ICE Protocol Converter identified in Schedule 14.
	 
	1.12	 	“End User Licence” shall mean a licence agreement substantially
conforming to that agreement set forth in Schedule 7.
	 
	1.13	 	“Half Year” shall mean each calendar half year ending the 30th
June and 31st December of any year.
	 
	1.14	 	“HP” shall mean any Hewlett Packard compatible computer running
HP-UX v9.0.5 (and later versions as may be mutually agreed).
	 
	1.15	 	“IBM PC” shall mean any computer. 486 (or above) processor based
IBM AT architecture, having, at a minimum. 16Mb RAM. 50Mb hard
disc space and running Microsoft DOS v6.2 (and later versions as
may be mutually agreed) and, where appropriate, Microsoft
Windows 95 or Windows NT. ARM will use reasonable endeavours, in
collaboration with LGS, to ensure the Software operates on
reputable IBM PC compatible computers provided that such
operation is not constrained by significant hardware or software
deficiencies.
	 
	1.16	 	“Intellectual Property” shall mean any patents, patent rights,
trade marks, service marks, registered designs, topography or
semiconductor maskwork rights, applications for any of the
foregoing, copyright, know-how, unregistered design right,
confidential information, any Intellectual Property Derivatives,
and any other similar protected rights in any country, which are
taken into use in the design, use or production of the ARM7TDMI
Core. Software or Transfer Materials.
	 
	1.17	 	“Intellectual Property Derivatives” shall include: (i) for
copyrightable or copyrighted material, any translation,
abridgement, revision or other form in which an existing work
may be recast, transformed or adapted; (ii) for work protected
by topography or mask right, any translation, abridgement,
revision or other form in which an existing work may be recast,
transformed or adapted; (iii) for patentable or patented
material, any improvement created by ARM; and (iv) for material
protected by trade secret any new material derived from or
employing such existing trade secret.
	 
	1.18	 	“LG Affiliate” shall mean each of the companies set forth in
Schedule 10. An LG Affiliate shall cease to be an LG Affiliate
when; (i) it is merged into a corporation other than an LG Group
Company; or (ii) the majority of its voting shares becomes owned
or controlled by a person, company or other legal entity other
than an LG Group Company; or (iii) the Chief Executive Officer
(referred to in Korean as “Hoejang”) ceases to control directly
or indirectly such LG Affiliate.
	 
	1.19	 	“LG Group Company” shall mean each of the companies identified in Schedule 8.
	 
	1.20	 	“LGS Users” shall mean LGS (or any LG Group Company) when
incorporating an ARM Compliant Product, distributed pursuant to
this Agreement, for use in LGS’s (or such LG Group Company’s)
end user products.
	 
	1.21	 	“LGS Materials” shall mean such of the Transfer Materials (or
any additional materials) as are necessary to enable ARM, in
respect of any Modified ARM7TDMI Core, to exercise the rights
set out in Clause 2.3.
	 
	1.22	 	“Models” shall mean: (i) the object code and source code of the
programs identified in Schedule 3 Part A; (ii) the object code
and such source code of the programs identified in Schedule 3
Part B as may be necessary (at ARM’s absolute discretion) to
allow the support of

Page 2

 

	 	 	subsequent releases of the specified simulator: and (iii) subject to the
payment by LGS of the fee(s) set out in Clause 9.2, the object code and such
source code of the programs identified in Schedule 3 Part C as may be necessary
(at ARM’s absolute discretion) to allow the support of subsequent releases of
the specified simulator; together with such Updates thereof, if any, as are
developed by or for ARM.

	1.23	 	“Modified ARM7TDMI Core” shall mean any ARM7TDMI Core modified
in accordance with the provisions of Clause 2.2.
	 
	1.24	 	“NSP” shall mean the net sales price of any ARM Compliant
Product calculated by taking the aggregate invoice price charged
on arm’s length terms by LGS and its Subsidiaries in the sale or
distribution of any ARM Compliant Product, less any (i) value
added, turnover, import, or other tax, duty or tariff payable
thereon (ii) freight and insurance costs incurred and (iii)
amounts actually repaid or credited with respect to any ARM
Compliant Products returned.
	 
	 	 	In the event that ARM, in its discretion, considers that the NSP for any ARM Compliant
Product charged to LGS Users is materially below the open market value for such ARM Compliant
Product, the NSP shall be deemed to be: in the case of the sale or distribution of any ARM
Compliant Product to LGS Users, the net sales price for such ARM Compliant Product sold by LGS
to third parties; and in the case of the sale or distribution of ARM Compliant Products
manufactured for, and supplied solely to, LGS Users, at a minimum, the sum of:

	 	(i)	 	the cost of materials and the cost of fabrication or
such other processing of such ARM Compliant Product;
and
	 
	 	(ii)	 	an amount for general expenses and profit equal to
that usually reflected in the sales to third parties
of products of the same general class or kind as the
ARM Compliant Product; and
	 
	 	(iii)	 	the cost of all packaging.

	1.25	 	“PIV Card” shall mean the hardware identified in Schedule 2 Section 1 Part A as Item E1.
	 
	1.26	 	“Software” shall mean together the Models, Tools, Test Programs, Embedded ICE and Vectors.
	 
	1.27	 	“Subsidiary” shall mean any company the majority of whose voting
shares is now or hereafter owned or controlled, directly or
indirectly, by a party hereto or any company a majority of whose
voting shares is now or hereafter owned or controlled, directly
or indirectly, by any of the aforementioned entities. A company
shall be considered a Subsidiary only so long as such control
exists.
	 
	1.28	 	“Sun/SunOS” shall mean any Sun/SPARC compatible computer running
SunOS v4.1.3_u1 (and later versions as may be mutually agreed).
	 
	1.29	 	“Test Programs” shall mean the source code and object code of
the programs identified in Schedule 2 Part B Section 1 Items T1
and T2 together with such Updates, if any, as are developed by
or for ARM.
	 
	1.30	 	“Test Chip” shall mean a device which complies with the test
chip specification set forth in Schedule 2 Part A Item D1.
	 
	1.31	 	“Test Chip Characterisation Vectors” shall mean those test
vectors identified in Schedule 2 Part A Items D6, D7, D8 and D9.

Page 3

 

	1.32	 	“Test Chip Functional Vectors” shall mean those test vectors
identified in Schedule 2 Part A Items D4 and D5.
	 
	1.33	 	“Tools” shall mean the source and object code of the programs
identified in Schedule 4 Parts A and B; and (ii) the
documentation identified in Schedule 4 Part C, together with
such Updates, if any, as are developed by or for ARM.
	 
	1.34	 	“Trademarks” shall mean the trademarks, service marks and logos set forth in Schedule 5.
	 
	1.35	 	“Transfer Materials” shall mean that technical information with
respect to the ARM7TDMI Core identified in Schedule 2 Part A.
	 
	1.36	 	“Updates” shall mean; (i) for the Software, any bug fixes or
enhancements to the Software the incorporation of which ARM, in
its absolute discretion, decides does not cause to be created a
new product; and (ii) for the Transfer Materials, all
modifications, enhancements and updates to the Transfer
Materials, created by ARM, including such modifications to the
Transfer Materials as are made by ARM’s other licencees and
adopted by ARM for general release as an update provided that
ARM may exclude any modification, enhancement or update which
ARM, in its absolute discretion decides, results in the creation
of a new product;
	 
	1.37	 	“Use” shall mean copying the programs identified in Schedule 3
Parts B and C and Schedule 4 Parts A and C onto a computer for
the purposes of processing the instructions or statements
contained therein, but excluding disassembly, reverse assembly,
or reverse compiling except as permitted by local legislation
implementing Article 6 of the EC Software Directive and only to
the extent necessary to achieve interoperability of an
independently created program with other programs. Disassembly,
reverse assembly, or reverse compiling for die purpose of error
correction is specifically prohibited.
	 
	1.38	 	“Vectors” shall mean together the Test Chip Functional Vectors
and Test Chip Characterisation Vectors.
	 
	1.39	 	“1995 Agreement” shall mean the Technology Licence Agreement
between ARM and LGS dated the 5th October 1995.
	 
	2.	 	Licence
	 
	2.1	 	In consideration of the fee (“Core Fee”) set out in Schedule 12
Part A, ARM hereby grants to LGS, under the Intellectual
Property, a perpetual (subject to Clause 18), non-transferable
(subject to Clause 20.3), non-exclusive, world-wide right and
licence to:

	 	(i)	 	use, modify (subject to the provisions of Clauses 2.2
and 2.3) and copy the Transfer Materials solely for
the purposes of creating, developing, manufacturing,
having manufactured (subject to the provisions of
Clauses 2.4 and 2.5), and selling, supplying and
distributing to any third party, ARM Compliant
Products;
	 
	 	(ii)	 	modify, translate, reproduce and distribute, subject
to the confidentiality obligations set forth in
Clause 14, the documentation identified in Schedule
2 (except Item A2).

Page 4

 

	2.2	 	LGS may modify:

	 	(i)	 	the internal logic of any ARM7TDMI Core:
	 
	 	(ii)	 	the layout of any ARM7TDMI Core where necessary for
the purposes of manufacturing such ARM7TDMI Core on
another CMOS process,

	 	 	PROVIDED ALWAYS THAT the Modified ARM7TDMI Core retains compatibility with the ARM
Instruction Set. A Modified ARM7TDMI Core will be deemed compatible if the Test Chip for the
Modified ARM7TDMI Core: (i) executes each and every instruction contained in the ARM
Instruction Set; (ii) executes the instructions at an identical rate of clocks per instruction
as the ARM7TDMI Core from which it was derived; and (iii) runs the Vectors and the AVS.
	 
	2.3	 	LGS hereby grants to ARM, in respect of all modifications made to
the ARM7TDMI Core (“Modifications”), a perpetual and irrevocable,
royalty-free, non-transferable, non-exclusive, world-wide right
and licence to manufacture, have manufactured, modify, create
derivative works of, use, sell, supply and distribute all
Modifications and sub-license others to exercise similar rights
with respect to such Modifications. In pursuance of the licence
to all Modifications hereby granted, LGS shall;

	 	2.3.1	 	prior to any prototype production of the first ARM
Compliant Product including any Modification,
deliver to ARM, in writing, a full technical
description of such proposed Modification; and
	 
	 	2.3.2	 	within thirty (30) days of the first shipment of
the first ARM Compliant Product including any
Modification, deliver to ARM the LGS Materials for
such ARM Compliant Product including the
Modification.

	 	 	For the avoidance of doubt, nothing in this Clause 2.3 shall be construed as granting to
ARM any right or licence to any peripheral devices owned by LGS which are integrated around
the ARM7TDMI Core.
	 
	 	 	ARM shall notify LGS in the event that ARM incorporates any Modification in any general
update to or general release of the ARM7TDMI Core.

	2.4	 	LGS may exercise its right to have manufactured ARM Compliant Products provided that:

	 	(i)	 	LGS notifies ARM of the identity of LGS’s
subcontracted manufacturer (“Manufacturer”) not less
than thirty (30) days prior to first prototype
production by the Manufacturer; and
	 
	 	(ii)	 	LGS ensures that any Manufacturer agrees (i) to be
bound by the same obligations of confidentiality as
are contained in this Agreement and (ii) to supply
The ARM Compliant Products solely to LGS.

	 	 	In the event that any Manufacturer breaches the provisions referred to in this Clause
2.4, LGS agrees that such breach shall be treated as a material breach of this Agreement by
LGS which is incapable of
remedy. Further LGS hereby undertakes to keep ARM indemnified against all and any loss,
liability, costs, damages, expenses (including the fees of lawyers and other professionals),
suffered, incurred or sustained as a result of or in relation to such breach.
	 
	 	 	For the avoidance of doubt, in the event that LGS subcontracts only the packaging of ARM
Compliant Products to a third party, LGS shall be released from the obligations of this Clause
2.4.

Page 5

 

	2.5	 	In the event that LGS subcontracts the packaging of ARM Compliant Products, LGS shall

	 	(i)	 	ensure that the packaging company agrees to supply
the ARM Compliant Products solely to LGS; and
	 
	 	(ii)	 	undertake to keep ARM indemnified against all and
any loss, liability, costs, damages, expenses
(including the fees of lawyers and other
professionals), suffered, incurred or sustained as a
result of or in relation to the breach of the
provisions of Clause 2.5(i).

	2.6	 	For the avoidance of doubt, no right is granted to LGS to:

	 	(i)	 	sublicense the rights licensed to LGS pursuant to Clause 2.1;
	 
	 	(ii)	 	distribute any ARM Compliant Product prior to
verification in accordance with Clause 3 except that
in the event that it is the intention of LGS, and
LGS do proceed, to verify a device in accordance
with Clause 3, LGS may distribute a maximum of one
hundred (100) prototype units of such device without
having verified such device.

	2.7	 	Save as licensed in Clause 2.1, LGS acquires no right, title or
interest in the ARM7TDMI Core or Transfer Materials and
Intellectual Property. In no event shall the licence grant set
forth in Clause 2.1 be construed as granting LGS, expressly or by
implication, estoppel or otherwise, a licence to use any ARM
technology or intellectual property other than that pertaining to
the ARM7TDMI Core.
	 
	2.8	 	During the term of this Agreement, LGS may exercise the right to
include any Subsidiary as a licence of ARM provided that:

	 	(i)	 	such Subsidiary agrees in writing, as set forth in
Schedule 1, to be bound by the obligations of LGS and
to comply with all the terms and conditions of this
Agreement LGS shall deliver to ARM a copy of the
Subsidiary’s undertaking within thirty (30) days of
the execution of such undertaking:
	 
	 	(ii)	 	any breach of the terms and conditions of this
Agreement by a Subsidiary shall constitute a breach
of this Agreement by LGS;
	 
	 	(iii)	 	any termination of this Agreement as provided by
Clause 18 shall be effective in respect of all
Subsidiaries;
	 
	 	(iv)	 	any licence, granted in accordance with the
provisions of this Clause 2.8, shall automatically
terminate upon any Subsidiary ceasing to be a
Subsidiary.

	2.9	 	During the term of this Agreement LGS may exercise the right to
include any LG Affiliate as a Licence of ARM provided that:

	 	(i)	 	such LG Affiliate agrees in writing, as set forth in
Schedule 11, to be bound by the obligations of LGS
and to comply with all the terms and conditions of
this Agreement LGS shall deliver to ARM a copy of the
LG Affiliate’s undertaking within thirty (30) days of
the execution of such undertaking;
	 
	 	(ii)	 	any breach of the terms and conditions of this
Agreement by a LG Affiliate shall constitute a
breach of this Agreement by LGS;
	 
	 	(iii)	 	any termination of this Agreement as provided by
Clause 18 shall be effective in respect of all LG
Affiliates;

Page 6

 

	 	(iv)	 	any licence, granted in accordance with the provisions of this
Clause 2.9, shall automatically terminate upon any LG Affiliate
ceasing to be a member of the LG Group.

	3.	 	Verification of ARM Compliant Products
	 
	3.1	 	LGS shall manufacture and characterise a Test Chip for the
ARM7TDMI Core and any Modified ARM7TDMI Core.
	 
	3.2	 	LGS shall:

	 	(i)	 	run the Vectors, in the appropriate format, on the
Test Chip and deliver to ARM, a copy of the log (“the
Log Results”) generated by running the Vectors
together with five (5) samples of the Test Chip: and
	 
	 	(ii)	 	run the AVS on the Test Chip (by means of a PIV
Card) and deliver to ARM a copy of the log (“the AVS
Results”) generated by running the AVS.

	 	 	ARM may, at ARM’S discretion, exercise the right to run the Vectors and/or AVS on the
Test Chip.
	 
	3.3	 	The ARM7TDMI Core shall be verified upon:

	 	(i)	 	ARM’S acceptance, of the Log Results either; (a)
delivered by LGS; or (b) generated by ARM. The Log
Results shall be accepted when they indicate that no
errors have been detected or where any errors
detected have been jointly agreed, in good faith, and
a waiver agreed between the parties: and
	 
	 	(ii)	 	ARM’s acceptance of the AVS Results either; (a)
delivered by LGS; or (b) generated by ARM. The AVS
Results shall be accepted when they indicate that no
differences have been detected between the AVS
Results and the AVS reference file supplied by ARM
or where any errors detected have been jointly
agreed, in good faith, and a waiver agreed between
the parties.

	 	 	ARM shall notify LGS, in writing, within thirty (30) days of delivery by LGS of the Log
Results and Test Chip samples to ARM (the “Verification Period”), whether the Test Chip has
been verified or has failed the verification process. In the event that the Test Chip fails
the verification process, ARM shall provide details of the errors which cause the failure to
LGS and LGS shall endeavour to correct the errors. The parties shall repeat the above process
until either: (i) the Test Chip is verified; or (ii) LGS withdraws the Test Chip from the
verification process. In the event that ARM fails to notify
LGS of the result of the verification process within the Verification Period, the Test Chip
subject to the verification process shall be deemed verified.
	 
	3.4	 	Provided that: (a) the Test Chip has been verified in accordance
with the provisions of Clause 3.2; and (b) the ARM Compliant
Product containing the ARM Core contained in such Test Chip runs
the Core Functional Test Vectors and they indicate that no errors
have been detected (or where any errors detected have been
jointly agreed, in good faith, and a waiver agreed between the
parties), LGS may distribute such ARM Compliant Product without
further verification.
	 
	3.5	 	LGS shall provide to ARM. free of charge, within thirty (30) days
of verification in accordance with Clause 3.2, fifty (50) samples
of each Test Chip manufactured by LGS on each process utilised
for such manufacture, so that ARM, at its option, may test the
compatibility of each Test Chip. For the avoidance of doubt,
there shall be no restriction on ARM’s use of such samples
provided that ARM shall not reverse engineer any Test Chips
provided by LGS under this Clause 3.

Page 7

 

	 	 	

	4.	 	Models Licence
	 
	4.1	 	In consideration of the fee (“Models Fee”) set out in Schedule 12
Part K, ARM hereby grants to LGS a non-transferable (subject to
Clause 20.3), non-exclusive, world-wide right and licence under
the Intellectual Property, to;

	 	(i)	 	reproduce and use, internally and for third party
support purposes, the Models and relevant
documentation;
	 
	 	(ii)	 	reproduce and distribute, and sub-license (provided
that the end user agrees to be bound by the End User
Licence) the Use of the object code of the Models
(excluding the Model identified in Schedule 3 Part
A);
	 
	 	(iii)	 	modify, reproduce, use and distribute, in
connection with the Models (excluding the Model
identified in Schedule 3 Part A), the documentation
(including any modified documentation) relevant
thereto.
	 
	 	(iv)	 	sub-license the distribution rights granted to LGS
under Clauses 4.1(ii) and (iii) to Authorised
Distributors only.

	4.2	 	For the avoidance of doubt, except as provided by Clause 4.1(iv),
no right is granted to LGS to sub-license the right to sell,
supply or otherwise distribute the Models.

	5.	 	Tools Licence
	 
	5.1	 	In consideration of the Fees set out in Schedule 12 Part L. ARM
hereby grants, to LGS, a non-transferable (subject to Clause
20.3), non-exclusive, world-wide right and licence under the
Intellectual Property, to;

	 	(i)	 	modify the Tools and related documentation identified
in Schedule 4 solely for the purpose of providing
Hangul language support and incorporating any LGS
logo;
	 
	 	(ii)	 	copy and use the Tools and related documentation
identified in Schedule 4 (and any modified versions
thereof created under the provisions of Clause
5.1(i)), internally only.

	5.2	 	If, within the period of two (2) years from the Effective Date
LGS exercises any of the following options;

	 	 	 	Option 1: payment of the fees (“Tools Distribution Option Fee 1”) set out in
Schedule 12 Part H; or
	 
	 	 	 	Option 2: payment of the fees (“Tools Distribution Option Fee 2”) set out in
Schedule 12 Part I; or
	 
	 	 	 	Option 3: payment of the fees (“Tools Distribution Option Fee 3”) set out in
Schedule 12 Part J.

	 	 	The licence to the Tools provided in Clause 5.1 shall be extended to include the
following rights:

	 	(i)	 	copy and distribute and sub-license (provided that
the end user agrees to be bound by the End User
Licence) the Use of the object code of the Tools
identified in Schedule 4 Part A and Schedule 4 Part
C;

Page 8

 

	 	(ii)	 	copy and distribute, and sub-license (provided that the end user
agrees to be bound by the End User Licence) the use of the Tools
identified in Schedule 4 Part B (including the Tools modified in
accordance with Clause 5.1(ii));
	 
	 	(iii)	 	modify, copy, use and distribute the Tools
documentation identified in Schedule 4 Part D
(including any modified Tools documentation);
	 
	 	(iv)	 	sub-license the distribution rights granted to LGS
under Clauses 5.2 (i)-(iii) to Authorised
Distributors only.

	5.3	 	For the avoidance of doubt, except as provided by Clause 5.2(iv),
no right is granted to LGS to sub-license the right to sell,
supply or otherwise distribute the Tools.

	5A.	 	 Embedded ICE Licence
	 
	5A.1	 	 In consideration of the fees paid by LGS to ARM as set out in
Schedule 12 Part C. ARM hereby grants to LGS a non-transferable
(subject to Clause 20.3), non-exclusive, world-wide licence
under the Intellectual Property to;

	 	(i)	 	use copy and modify the Embedded ICE, internally and for third party support purposes;
	 
	 	(ii)	 	copy and distribute and sub-license (provided that
the end user agrees to be bound by the End User
Licence) the Use of the binary code derived from the
source code for the Embedded ICE (together with any
modified versions thereof created under the
provisions of Clause 5A.1(i)) of the Embedded ICE.

	5B. PID7T Configurable Device Programs Licence
	 
	5B.1 ARM hereby grants to LGS a non-transferable (subject to Clause
20.3), non-exclusive, world-wide licence under the Intellectual
Property to;

	 	(i)	 	use copy and modify the PID7T Configurable Device
Programs identified in Schedule 15 Part B, internally
and for third party support purposes.

	6.	 	Verification and Test Licence
	 
	6.1	 	In consideration of the fees (“Core Fees”) paid by LGS to ARM as
set out in Schedule 12 Part A. ARM hereby grants to LGS a
non-transferable (subject to Clause 20.3), nonexclusive,
world-wide right and licence under the Intellectual Property, to
copy, modify (subject to the provisions of Clause 6.2) and use
internally only, the Test Programs and associated documentation.
	 
	6.2	 	LGS may modify the Test Programs provided that;

	 	(i)	 	the Test Programs exhibit the same functionality
after modification as they did prior to modification;
and
	 
	 	(ii)	 	LGS shall, upon request, from ARM, deliver, to ARM,
the source code for such modified Test Programs and
a file of the test patterns generated using such
modified Test Programs.

	6.3	 	ARM hereby grants, to LGS, a non-transferable (subject to Clause
20.3), non-exclusive, world-wide right and licence under the
ARM’s Intellectual Property rights, to copy and use internally
only, the AVS.

Page 9

 

	6.4	 	ARM hereby grants, to LGS a non-transferable (subject to Clause
20.3), non-exclusive, world-wide right and licence under the
ARM’s Intellectual Property rights, to copy, translate into
different formats and use, and distribute (subject to the
conditions attaching to limited confidential information
described in Clause 14.2) solely for the purpose of testing ARM
Compliant Products, the Vectors and Core Functional Vectors.
	 
	7.	 	Ownership of the Software
	 
	7.1	 	In no event shall the licence grants set forth in Clauses 4.1.
5.1, 5A.1 and 6.l be construed as granting LGS, expressly or by
implication, estoppel or otherwise, a licence under any ARM
technology other than the Software and related documentation.
	 
	7.2	 	Except as licensed to LGS in Clauses 4.1. 5.1. 5A.1 and 6.1 all
right, title and interest in and to the Software and related
documentation shall remain vested in ARM.
	 
	7.3	 	LGS shall reproduce and not remove or obscure any notice
incorporated in the Software or related documentation by ARM to
protect ARM’s Intellectual Property Rights or to acknowledge the
copyright and/or contribution of any third party developer. LGS
shall incorporate corresponding notices and/or such other
markings and notifications as ARM may reasonably require on all
copies of Software and related documentation used or distributed
by LGS.
	 
	8.	 	Trademark Licence
	 
	8.1	 	ARM hereby grants to LGS a non-transferable (subject to Clause
20.3), non-exclusive, royalty-free, world-wide right and licence
under ARM’s Intellectual Property rights, to use the Trademarks
in the promotion and sale of ARM Compliant Products.
	 
	8.2	 	LGS shall use the Trademarks, in accordance with ARM’s guidelines
set forth in Schedule 5 (the “Guidelines”), on (i) all ARM
Compliant Products sold or distributed by LGS and (ii) all
documentation, promotional materials and software associated with
such ARM Compliant Products. ARM shall have the right to revise
Schedule 5 and the Guidelines (including the right to add further
trademarks or modify the Trademarks) provided that such revisions
are made in respect of the Guidelines issued to all licencees of
the Trademarks. Any such revisions shall be effective, upon
ninety (90) days written notice to LGS.
	 
	8.3	 	LGS shall be released from the provisions of Clause 8.2 in the
case of any ARM Compliant Product, created or developed by LGS,
solely for a specific customer of LGS provided that; (a) the
customer has notified LGS, in writing, that the customer wishes
the ARM Compliant Product packaging not to bear any Trademark;
and (b) the ARM Compliant Product does not bear the LGS name or
trademark.
	 
	8.4	 	LGS shall submit samples of documentation, packaging, and
promotional or advertising materials bearing the Trademarks to
ARM from time to time in order that ARM may verity compliance
with the Guidelines. In the event that any documentation,
packaging, promotional or advertising material fails to comply
with the Guidelines, ARM shall notify LGS and LGS shall rectify
such documentation, packaging, and promotional or advertising
materials so as to comply with the Guidelines and cease using any
such non-compliant materials within thirty (30) days of the date
of ARM’s notice. Any documentation, packaging, and promotional or
advertising materials not rejected for failing to comply with the
Guidelines by ARM within thirty (30) days after delivery to ARM
shall be deemed approved.

Page 10

 

	8.5	 	LGS agrees to assist ARM in maintaining the validity of the
Trademarks by retaining a record of its use of the Trademarks.
Such records shall include samples of the use of each of the
Trademarks as well as information regarding the first use of the
Trademarks in each country. Upon request, LGS shall make
available all such records.
	 
	8.6	 	Except as provided by the terms of this Agreement, LGS shall not
use or register any trademark, service mark, device or logo, any
of the Trademarks or any word or mark confusingly similar to any
of the Trademarks in any jurisdiction.
	 
	9.	 	Licence Fees and Royalties
	 
	9.1	 	In consideration of the licences granted to the Transfer
Materials and the delivery of the Transfer Materials to LGS under
this Agreement, LGS shall pay the fees (“Core Fees”) set out in
Schedule 12 Part A.
	 
	9.1A	 	In consideration of the delivery of the PID7T cards and Embedded
ICE protocol converters (identified in Schedule 15) to LGS under
this Agreement, LGS shall pay the fee (“PID Fee”) set out in
Schedule 12 Part M.
	 
	9.2	 	For each ARM Compliant Product sold, supplied or distributed by
LGS. LGS shall pay a royalty (“Running Royalty”) calculated in
accordance with the provisions of Schedule 13.
	 
	9.3	 	For the period of five years from the Effective Date (“Design Win
Period”). LGS shall pay a non-refundable fee (“Design Win Fee”),
as set out in Schedule 12 Part G, upon each Design Win Event up
to a maximum of eight (8) Design Win Fees (except no Design Win
Fee shall be payable on the first Design Win Event). No Design
Win Fees shall be payable after the Design Win Period and LGS
shall not manipulate the sale, supply or other distribution of
any Design Win Product to avoid the payment of a Design Win Fee.
	 
	9.3A	 	After a period of ten (10) years from the first commercial
shipment of the first manufactured ARM Compliant Product under
this Agreement (the “Initial Period”), LGS shall be entitled to
either; (i) require ARM to enter into good faith negotiations to
revise the Running Royalty rates for the remainder of the term
of this Agreement; or (ii) require ARM to enter into good faith
negotiations to agree a sum payable by LGS to ARM in lieu of the
Running Royalties which would otherwise fall due in accordance
with the provisions of Clause 9.2. LGS shall exercise its rights
under this Clause 9.3A upon written notice to ARM referring to
this Clause 9.3A, served not less that six (6) months prior to
the expiry of the Initial Period. For the avoidance of doubt, in
the event that;

	 	(i)	 	LGS fails to serve any notice in accordance with the
provisions of Clause 9.3, the rights set forth in
Clause 9.3A shall lapse; or
	 
	 	(ii)	 	the parties fail to reach agreement prior to the
expiry of the Initial Period and LGS does not
terminate this Agreement, LGS shall continue to pay
the Running Royalties in accordance with the
provisions of Clause 9.2.

	9.4	 	In no event shall any Fee or Design Win Fee be construed as being
an advance payment of Running Royalties and no right of set off
of Running Royalties against any Fee or Royalty Fee paid to ARM,
by LGS, shall exist. LGS shall not manipulate distribution of ARM
Compliant Products between LGS Subsidiaries for the purpose of
avoiding payment of Running Royalties at a higher rate than would
have been the case if such manipulation had not taken place.

Page 11

 

	9.5	 	In consideration of the Embedded ICE licence under Clause 5A, LGS
shall pay to ARM a fee (“Embedded ICE Fee”), as set out in
Schedule 12 Part C, and for each microprocessor development
system created by LGS which incorporates the Embedded ICE (or a
modified version thereof created under the provisions of Clause
5A.1(i) a further fee (“Embedded ICE Royalty”) as set out in
Schedule 12 Part C.
	 
	9.6	 	Upon giving written notice to ARM referring to this Clause 9.6,
together with payment, to ARM of the option fee set out in
Schedule 12 Part B, for a limited period of three (3) years from
the Effective Date, LGS may extend the licence contained in
Clause 4 hereof, so as to include any of the simulator specific
models specified in Schedule 3 Part C.
	 
	9.7	 	In consideration of the Core maintenance services provided under
Clause 12 and the training provided under Clause 13A, LGS shall
pay, to ARM the fee (“Core Maintenance Fee”) set out in Schedule
12 Part D.
	 
	9.8	 	In consideration of the Software maintenance services provided
under Clause 13, LGS shall pay, to ARM the fee (“Software
Maintenance Fee”) set out in Schedule 12 Part E.
	 
	9.9	 	LGS shall keep all records of account as are necessary to
demonstrate compliance with its obligations under this Clause 9.
	 
	9.10	 	ARM shall have the right for representatives of a firm of
independent Chartered Accountants to which LGS shall not
unreasonably object (“Auditors’”), to make an examination and
audit by prior appointment during normal business hours, not
more frequently than once annually, of all records and accounts
as may under recognised accounting practices contain information
bearing upon (i) the number of chips and the NSP of ARM
Compliant Products sold or distributed by LGS under this
Agreement and (ii) the amounts of Running Royalties payable to
ARM under this Clause 9. The Auditors will report to ARM only
upon whether the Running Royalties paid to ARM by LGS were or
were not correct, and if incorrect, what are the correct amounts
for the Running Royalties. LGS shall be supplied with a copy of
or sufficient extracts from any report prepared by the Auditors.
The Auditors report shall (in the absence of clerical or
manifest error) be final and binding on the parties. Such audit
shall be at ARM’s expense unless it reveals an underpayment of
Running Royalties of five per cent (5%) or more, in which case
LGS shall reimburse ARM for the costs of such audit. LGS shall
make good any underpayment of royalties forthwith. If the audit
identifies that LGS has made an overpayment, such overpayment
will be credited to the next such payment or payments to be made
by LGS.
	 
	9.11	 	Any income or other tax which LGS is required by law to pay or
withhold on behalf of ARM with respect to any licence fees
and/or royalties payable to ARM under this Agreement shall be
deducted from the amount of such licence fees and/or royalties
otherwise due provided, however, that in regard to any such
deduction, LGS shall give to ARM such assistance as may be
necessary to enable or assist ARM to claim exemption therefrom,
or credit therefor, and shall upon request furnish to ARM such
certificates and other evidence of deduction and payment thereof
as ARM may properly require.
	 
	9.12	 	Any Running Royalties due to ARM under this Agreement shall be
paid in accordance with the terms set forth in Schedule 6 Part
B. All other sums shall be due, to ARM, in accordance with the
provisions of Schedule 12 and shall be paid within thirty (30)
days of the date of ARM’s invoice therefor except that in the
case of the Core Fee [*****] shall be paid within thirty (30)
days of the date of ARM’s invoice therefor and [*****] shall be
paid within ninety (90) days of the date of ARM’s invoice
therefor.

 

			
	[*****]	 -	 Portions of this exhibit are subject to a request for confidential treatment and
have been redacted and filed separately with the Securities and Exchange Commission.

Page 12

 

	9.13	 	If any sum due under this Agreement is not paid within thirty
(30) days of receipt of the invoice therefor, then (without
prejudice to ARM’s other rights and remedies) ARM reserves the
right to charge interest on such sum on a day to day basis (as
well after as before any judgement) from the date from which
payment was due to the date of payment at the rate of five (5)
per cent per annum above the base rate of Barclays Bank PLC from
time to time in force.
	 
	10.	 	Delivery, Acceptance and Production Costs
	 
	10.1	 	In consideration of the payment to ARM by LGS of the fee
(“Design Transfer Fee”) set out in Schedule 12 Part F. ARM shall
port and deliver to LGS database CD in respect of the ARM7TDMI
Core which conform to the LGS 0.35 micron ASIC Design Rules
Version 2 (Aug 19th 1996). In the event that LGS delivers a
later set of rules ARM shall review and if the amount of work
involved is substantially different then ARM and LGS shall
mutually agree an alternative course of action.
	 
	10.2	 	ARM shall deliver any deliverables due to LGS under the
provisions of this Agreement in accordance with the delivery
schedule set forth in Schedule 9.
	 
	10.3	 	Unless otherwise agreed in writing, delivery:

	 	(i)	 	by LGS, shall take place at Advanced RISC Machines
Limited 90 Fulbourn Road, Cherry Hinton, Cambridge
CB1 4JN. England marked for the attention of the
Engineering Director;
	 
	 	(ii)	 	by ARM, shall take place at 16 Woomyeon-dong,
Seocho-gu, Seoul 137-140. Korea marked for the
attention of Mr Jay H. Kim.

	10.4	 	ARM shall not be responsible under the terms of this Agreement
for any recoverable or non-recoverable costs incurred directly
or indirectly, by LGS in the design translation, processing, or
manufacture of masks and prototypes characterisation or
manufacture of production quality silicon in whatever quantity.
	 
	11.	 	Contract Administrators
	 
	11.1	 	The parties hereby appoint the following individuals as their
respective contract administrators between ARM and LGS with
respect to this Agreement:

	 	 	 
	ARM:	 	LGS:
	 
	 	 
	For legal notices:
	 	 
	 
	David N MacKay 

VP of Strategic Alliances 

Advanced RISC Machines Limited

90,
 Fulbourn Road 

Cherry Hinton 

Cambridge 

CBl 4JN 

England

	 	Jong-Taek Hong

General Manager Legal Affairs Department

LG Semicon Co Limited

891 Daechi-dong

Kangnam-ku

Seoul

Korea

Page 13

 

	 	 	 
	For corporate issues:
	 	 
	 
	 	 
	James S Urquhart
	 	 
	VP of Sales and Marketing

	 	Mr. Young-Pyo Bae
	Advanced RISC Machines Limited

	 	Managing Director
	90, Fulbourn Road

	 	LG Semicon Co Limited
	Cherry Hinton

	 	891 Daechi-dong
	Cambridge

	 	Kangnam-ku
	CB1 4JN

	 	Seoul
	England

	 	Korea
	 
	 	 
	For Confidential Information:
	 	 
	 
	 	 
	Bryn Parry

	 	Mr. Jay H. Kim
	Business Unit Manager

	 	Group Leader MD 8
	At the address set forth above

	 	At the address set forth above
	 
	 	 
	For financial issues:
	 	 
	 
	 	 
	Angela Au

	 	Mr. K K. Kang
	Financial Controller

	 	General Manager
	At the address set forth above

	 	At the address set forth above
	 
	 	 
	For applications support:
	 	 
	 
	 	 
	Bryn Parry

	 	Mr. Jay H. Kim
	Business Unit Manager

	 	Group Leader MD 8
	At the address set forth above

	 	At the address set forth above
	 
	 	 
	For software support:
	 	 
	 
	 	 
	Bryn Parry

	 	Mr. Jay H. Kim
	Business Unit Manager

	 	Group Leader MD 8
	At the address set forth above

	 	At the address set forth above

	11.2	 	The contract administrators identified herein are appointed by
the parties for the receipt and dispatch on their behalf of all
communications relating to the administrators’ above designated
areas of responsibility. The contract administrators shall also
be responsible for the good progress of the parties’ performance
under this Agreement and the timely resolution of all technical,
administrative and commercial issues which may arise from time
to time during the execution of this Agreement.
	 
	11.3	 	Each party reserves the right to change its appointment as above
upon seven (7) days written notice to the other party’s then
current corresponding liaison.
	 
	12.	 	Core Maintenance Services
	 
	12.1	 	In consideration of the payment of the Core Maintenance Fee to
ARM, by LGS, ARM shall provide, to LGS, in respect of the
ARM7TDMI Core through the parties’ applicable contract
administrator, the following maintenance services;

	 	(i)	 	the correction, to the extent reasonably possible, of
any defects in any ARM7TDMI Core which cause such
ARM7TDMI Core not to operate in accordance with the
functionality described in the applicable
documentation. If ARM determines that such defects
are due to errors in such description, ARM shall
promptly issue corrections to the applicable
documentation and shall not be required to correct
the

Page 14

 

         
          Transfer Materials provided that LGS is not thereby prevented from
commercially exploiting such ARM7TDMI Core.

	 	(ii)	 	reasonable telephone and written consultation
pertaining to the operation and application of the
ARM7TDMI Core;
	 
	 	(iii)	 	any bug-fixes or corrections to the ARM7TDMI Core
made available by ARM to any third party;
	 
	 	(iv)	 	all Updates to the ARM7TDMI Core;
	 
	 	(v)	 	the provision of ARM-related training;

	 	 	The services provided under Clauses 12.1(ii), 12.1(v) and 13.1(ii) shall together be
limited to a total of thirty (30) man days per annum.
	 
	12.2	 	Upon LGS requesting ARM’S assistance pursuant to the provisions
of Clause 12.1, LGS shall promptly provide to ARM such samples
and technical information as ARM may reasonably require to
enable ARM to provide such assistance.
	 
	12.3	 	In notifying ARM of any defects or problems LGS shall use a
format and medium reasonably requested by ARM. Notwithstanding
the foregoing, LGS shall provide ARM promptly with any
information or assistance reasonably requested by ARM to enable
ARM to provide the maintenance service hereunder.
	 
	12.4	 	The maintenance services shall be provided at ARM’s UK premises.
Nevertheless, ARM will use reasonable efforts to provide
maintenance services to LGS, at LGS’s premises, subject to LGS
meeting all reasonable travelling, accommodation and sustenance
expenses.
	 
	12.5	 	For the avoidance of doubt, ARM’s obligation under this Clause
12 is limited expressly to the provision of the maintenance
services to LGS and ARM shall be under no obligation to provide
the maintenance services to LGS’s customers.
	 
	13.	 	Software Maintenance Services
	 
	13.1	 	In consideration of the payment of the Software Maintenance Fee
to ARM, by LGS, ARM shall provide to LGS, in respect of the
Software, through the parties’ applicable contract
administrator, the following maintenance services:

	 	(i)	 	to correct, to the extent reasonably possible, any
defects in the Software which cause the Software not
to operate in accordance with the description of the
Software’s function in the applicable documentation.
If ARM determines that such defects are due to errors
in such description, ARM shall promptly issue
corrections to the documentation and shall not be
required to alter the Software provided that LGS is
not thereby prevented from commercially exploiting
the Software.
	 
	 	(ii)	 	to provide reasonable telephone and written
consultation pertaining to the operation and
application of the Software.
	 
	 	(iii)	 	to provide as available Updates to the Software.

	13.2	 	In notifying ARM of any defects or problems LGS shall use a
format reasonably requested by ARM. LGS shall provide ARM
promptly with any information or assistance reasonably requested
by ARM to enable ARM to provide the maintenance service
hereunder.
	 
	13.3	 	For the avoidance of doubt, ARM’s obligation under this Clause
13 is limited expressly to the provision of the Software
maintenance services to LGS and ARM shall be under no obligation
to provide the maintenance services to LGS’s sub-licensees of
the Software.

Page 15

 

	13A.	 	 Training
	 
	I3A.1	 	In consideration of the Fees see out in Schedule 12 Part D. ARM
shall provide, on reasonable notice, at ARM’s premises in
Cambridge, up to four (4) weeks of support for up to two (2)
LGS personnel in relation to building the Test Chip and use of
the Embedded ICE.
	 
	14.	 	Confidentiality
	 
	14.1	 	Save as provided by Clause 14.2, each party shall maintain in
confidence the Confidential Information disclosed by the other
party and apply security measures no less stringent than the
measures that such party applies to protect its own like
information, but not less than a reasonable degree of care, to
prevent unauthorised disclosure and use of the Confidential
Information. The period of confidentiality shall be (i)
indefinite with respect to the terms of this Agreement, pattern
generation tapes and photomasks and (ii) twenty (20) years with
respect to all other information.
	 
	14.2	 	In the event that either party qualifies the confidentiality of
any Confidential Information in writing by marking such
Confidential Information with the words “Limited
Confidentiality”, such Confidential Information may be disclosed
to a third party who has entered into a non disclosure agreement
(“NDA”) with the recipient containing substantially similar
terms to this Clause 14. A NDA in respect of the disclosure of
business Confidential Information may be limited in duration to
a period of not less than three (3) years from the date of
disclosure. A NDA in respect of the disclosure of technical
Confidential Information may be limited in duration to a period
of not less than five (5) years from the date of disclosure.
	 
	14.3	 	The provisions of this clause shall not apply to information which:-

	 	(i)	 	is known and has been reduced to tangible form by the
receiving party prior to disclosure by the other
party; or
	 
	 	(ii)	 	is, or becomes through no fault of the receiving party, generally known; or
	 
	 	(iii)	 	is disclosed to the receiving party by a third
party having the lawful right to make such
disclosure; or
	 
	 	(iv)	 	is independently conceived by the receiving party
provided that the receiving party is able to provide
evidence of such independent conception in the form
of written records; or
	 
	 	(v)	 	is released to the receiving party for disclosure to
any third party, other than on a confidential basis,
by the disclosing party in writing; or
	 
	 	(vi)	 	as required by any court or other governmental body.

	14.4	 	For the avoidance of doubt, LGS Royalty Reports may be disclosed
to, in confidence, ARM’s financial and/or legal advisors. In
addition, ARM may disclose the total unit sales of ARM Compliant
Products.
	 
	14.5	 	The parties agree that the disclosure of Confidential
Information to a party hereunder shall be co-ordinated through
the appointed contract administrators identified for such
purpose in Clause 11.1.

Page 16

 

	15.	 	Warranties
	 
	15.1	 	ARM warrants that the materials delivered to LGS will be
sufficient for a competent semiconductor manufacturer to produce
an ARM7TDMI Core which meets the functionality specified in the
ARM Datasheet Doc. No. ARM DDI 0029E. LGS’s sole and exclusive
remedy for any breach of such warranty shall be for ARM to
correct any errors in the materials and deliver such corrected
materials to LGS or replace the materials at ARM’s discretion.
	 
	15.2	 	LGS acknowledges that the Software cannot be tested in every
possible operation, and accordingly ARM does not warrant that
the Software will be free from all defects or that there will be
no interruption in its use. However, ARM warrants that the
Software will be complete and comply with the description of its
functionality specified in the documentation. LGS’s sole and
exclusive remedy for any breach of such warranty shall be for
ARM, as soon as is reasonably practicable, to correct any errors
in the Software and deliver such corrected Software to LGS.
	 
	15.3	 	ARM further warrants that to ARM’s knowledge and belief, but
expressly without having undertaken any searches for prior art,
that:

	 	(i)	 	the ARM7TDMI Core, and Software do not infringe any
third party copyright, maskwork right or trade
secret; and
	 
	 	(ii)	 	there are no pending claims that have been made, or
actions commenced, against ARM for breach of any
third party copyright, maskwork right, patent or
trade secret; and
	 
	 	(iii)	 	ARM, or its applicable licensor, is the owner of the properties to be delivered to LGS; and
	 
	 	(iv)	 	ARM has the right to enter into the Agreement.

	15.4	 	Except as expressly provided in this Agreement, the ARM7TDMI
Core. Software, Intellectual Property, and Transfer Materials
are licensed “as is” and ARM makes no warranties express,
implied or statutory, including, without limitation, the implied
warranties of merchantability or fitness for a particular
purpose with respect to the ARM7TDMI Core, Software,
Intellectual Property and Transfer Materials.
	 
	15.5	 	LGS warrants that LGS shall:

	 	(i)	 	submit this Agreement for approval by the Korean
Government forthwith upon signature by the parties;
and
	 
	 	(ii)	 	use all reasonable endeavours to obtain all or any
tax exemption or tax credits applicable to the
technology licensed and monies payable under this
Agreement.

	16.	 	Infringement
	 
	16.1	 	Each party (the “Delivering Party”) will support the other party
(the “Receiving Party”) in any action based on a claim that the
materials delivered by the Delivering Party to the Receiving
Party under this Agreement (the “Delivered Materials”), when
used in accordance with this Agreement, infringe any patent,
copyright or trade secret provided that the Receiving Party
shall notify the Delivering Party promptly in writing of each
such suit. However, a party shall not be obliged to support the
other party in any action based upon an infringement or alleged
infringement of any patent, copyright, trade secret, mask work,
trademark or other property right by; (a) the Receiving Party’s
manufacturing process; (b) any modification of the Delivered
Materials not made by the Delivering Party; or (c) the use of

Page 17

 

	 	 	the Delivered Materials in combination with other equipment, technology or
software not purchased or licensed from the Delivering Party, provided that
such claim would not have occurred but for such combination, modification or
enhancement.

	16.2	 	The Receiving Party will support the Delivering Party in any
action based on a claim that (a) the process used by or on
behalf of the Receiving Party in manufacturing products
incorporating, embodying or based upon the Delivered Materials,
(b) any modification of the Delivered Materials made by or on
behalf of the Receiving Party, or (c) the use of the Delivered
Materials in combination with other equipment, software or
technology not purchased or licensed from the Delivering Party,
provided that such claim would not have occurred but for such
combination, modification or enhancement, has infringed any
patent, copyright or trade secret provided that the Delivering
Party shall notify the Receiving Party promptly in writing of
such suits.
	 
	16.3	 	If any Delivered Materials provided to LGS by ARM, or any
portion thereof, is finally adjudged to infringe a patent or
copyright, ARM shall, at ARM’s election, use its reasonable
efforts to; (a) procure the right to continue using the
unmodified Delivered Materials; (b) modify the Delivered
Materials so that they become non-infringing; (c) replace the
unmodified Delivered Materials, or infringing portions thereof,
with reasonably equivalent non-infringing products; or (d) pay
compensatory damages to LGS, subject to the limitations of
Clause 16.6. The provisions of this Clause 16.3 do not extend to
any suit based upon an infringement or alleged infringement of
any patent, copyright, trade secret, mask work, trademark or
other property right by; (a) the LGS manufacturing process; (b)
any modification of the Delivered Materials not made by ARM; or
(c) the use of the Delivered Materials in combination with other
equipment, technology or software not purchased or licensed from
ARM, provided that such claim would not have occurred but for
such combination, modification or enhancement.
	 
	16.4	 	If any Delivered Materials provided to ARM by LGS, or any
portion thereof, is finally adjudged to infringe a patent or
copyright. LGS shall, at LGS’s election, use its reasonable
efforts to; (a) procure the right to continue using the
unmodified Delivered Materials; (b) modify the Delivered
Materials so that they become non-infringing; (c) replace the
unmodified Delivered Materials, or infringing portions thereof,
with reasonably equivalent non-infringing products; or (d) pay
compensatory damages to ARM subject to the limitations of Clause
16.6. The provisions of this Clause 16.4 do not extend to any
suit based upon an infringement or alleged infringement of any
patent, copyright, trade secret, mask work, trademark or other
property right by any modification of the Delivered Materials
not made by LGS.
	 
	16.5	 	In the event that there is a final adjudication of infringement,
the liability of the Delivering Party for such infringement
shall terminate with respect to all damages regarding the
infringing intellectual property arising after the date of such
final adjudication.
	 
	16.6	 	THE FOREGOING STATES THE ENTIRE LIABILITY OF THE PARTIES, AND
THE EXCLUSIVE REMEDY FOR THE PARTIES, FOR ANY INFRINGEMENT OF
ANY PATENT, COPYRIGHT, TRADEMARK, TRADE SECRET, MASK WORK OR
OTHER PROPRIETARY RIGHT OF A THIRD PARTY. ARM AND LGS DISCLAIM
ALL OTHER LIABILITY FOR ANY SUCH INFRINGEMENT. INCLUDING ANY
INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES. NOTWITHSTANDING
ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT. NEITHER
PARTY SHALL BE LIABLE FOR ANY AMOUNTS IN EXCESS OF THE SUM OF
TWO HUNDRED AND EIGHTY FIVE THOUSAND US DOLLARS (US$285,000) IN
THE AGGREGATE FOR ALL PAYMENTS MADE PURSUANT TO ANY CLAIMS IN
ANY WAY ARISING OUT OF OR IN CONNECTION WITH THE PROVISIONS OF
THIS CLAUSE 16.

Page 18

 

	17.	 	Disclaimer of Consequential Damages
	 
	17.1	 	IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY INDIRECT,
SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES WHETHER SUCH
DAMAGES ARE ALLEGED AS A RESULT OF TORTIOUS CONDUCT OR BREACH OF
CONTRACT OR OTHERWISE EVEN IF THE OTHER PARTY HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES. SUCH DAMAGES SHALL INCLUDE
BUT SHALL NOT BE LIMITED TO THE COST OF REMOVAL AND
REINSTALLATION OF GOODS, LOSS OF GOODWILL, LOSS OF PROFITS, LOSS
OF USE OF DATA, INTERRUPTION OF BUSINESS OR OTHER ECONOMIC LOSS
BUT NOTHING IN THIS CLAUSE SHALL OPERATE TO EXCLUDE LIABILITY
FOR DEATH OR PERSONAL INJURY RESULTING FROM EITHER PARTY’S
NEGLIGENCE.
	 
	18.	 	Term and Termination
	 
	18.1	 	This Agreement shall commence on the Effective Date and continue
in force, except as provided by Clause 18.3, unless and until
terminated in accordance with the provisions of Clause 18.2.
	 
	18.2	 	Without prejudice to any other right or remedy which may be
available to it, either party shall be entitled summarily to
terminate this Agreement by giving written notice to the other.

	 	(i)	 	if the other party has committed a material breach of
any of its obligations hereunder which is not capable
of remedy; or
	 
	 	(ii)	 	if the other party has committed a material breach
of any of its obligations hereunder which is capable
of remedy but which has not been remedied within a
period of sixty (60) days following receipt of
written notice to do so; or
	 
	 	(iii)	 	makes any voluntary arrangement with its creditors
for the settlement of its debts or becomes subject
to an administration order; or
	 
	 	(iv)	 	has an order made against it. or passes a
resolution, for its winding-up (except for the
purposes of amalgamation or reconstruction) or has
an encumbrancer take possession or has a receiver or
similar officer appointed over all or substantially
all of its property or assets.

	18.3	 	After a period of seven and one half (7.5) years from the
Effective Date of the 1995 Agreement (the “Initial Period”), the
licence set forth in Clause 5 shall expire automatically
whereupon LGS shall have no further right or licence in respect
of the Tools. However, LGS may renew the licence granted under
the provisions of Clause 5, subject to the provisions of Clauses
18.3(i) and (ii), for a further term of seven (7) years upon
payment of a fee (“Renewal Fee”).

	 	(i)	 	LGS may exercise its rights to renew, as provided by
this Clause 18.3, provided that LGS gives to ARM not
less than six (6) months notice in writing of its
intention to so renew, expiring on the seventh
anniversary of the Effective Date.
	 
	 	(ii)	 	Upon receipt of LGS’s notice served in accordance
with Clause 18.3(i), the parties shall enter into
good faith negotiations to agree a reasonable
Renewal Fee. For the avoidance of doubt, LGS shall
not be entitled to exercise any of the rights
contained in Clause 5 unless and until agreement has
been reached and the Renewal Fee has been paid to
ARM.

Page 19

 

	18.4	 	LGS and ARM acknowledge that each and every term and condition
of this Agreement has been fully and completely negotiated and
such terms and conditions closely relate to each other. In the
event that the Korean governmental authorities, including the
Korean Fair Trade Commission, during the review of this
Agreement require a modification to one or more of the clauses
or this Agreement. ARM shall have the option to renegotiate the
entire Agreement or accept the applicable modification of the
Agreement as required by such governmental authorities.
	 
	19.	 	Effect of Termination
	 
	19.1	 	Upon termination of this Agreement by either party pursuant to
Clause 18.2, LGS will immediately discontinue any use and
distribution of all ARM Compliant Products, Software,
Intellectual Property, Transfer Materials and ARM Confidential
Information. LGS shall, at ARM’s option, either destroy or
return to ARM any Confidential Information, including any copies
thereof in its possession, together with the Transfer Materials
and all copies of the Software in its possession. Within one
month after termination of this Agreement LGS will furnish to
ARM a certificate signed by a duly authorised officer of LGS
that to the best of his or her knowledge, information and
belief, after due enquiry, LGS has complied with provisions of
this Clause. For the avoidance of doubt, any sub-licences of the
Software granted by LGS prior to the termination of this
Agreement shall survive such termination.
	 
	19.2	 	Upon termination of this Agreement the termination date shall be
treated as the end of a Half Year for the purposes of accounting
for all Running Royalties due to ARM. Thereafter LGS shall
submit a royalty report to ARM in accordance with the provisions
of Schedule 6.
	 
	19.3	 	The provisions of Clauses 1, 2.3, 2.4 (in respect of LGS’s
obligation to indemnify ARM thereunder), 7, 9 (to the extent
that any amounts remain due and unpaid at the date of
termination), 14, 16, 17, 19, and 20 shall survive termination
or expiration of this Agreement.
	 
	20.	 	General
	 
	20.1	 	All communications between the parties including, but not
limited to, notices, royalty reports, error or bug reports, the
exercise of options, and support requests shall be in the
English language.
	 
	20.2	 	All notices which are required to be given hereunder shall be in
writing and shall be sent to the address of the recipient set
out in this Agreement or such other address as the recipient may
designate by notice given in accordance with the provisions of
this Clause. Any such notice may be delivered personally, by
commercial overnight courier or facsimile transmission which
shall be followed by a hard copy and shall be deemed to have
been served if by hand when delivered, if by commercial
overnight courier 48 hours after deposit with such courier, and
if by facsimile transmission when dispatched.
	 
	20.3	 	Neither party shall assign or otherwise transfer this Agreement
or any of its rights and obligations hereunder whether in whole
or in part without the prior written consent of the other.
	 
	20.4	 	Neither party shall be liable for any failure or delay in its
performance under this Agreement due to causes, including, but
not limited to, acts of God, acts of civil or military
authority, fires, epidemics, floods, earthquakes, riots, wars,
sabotage, third party industrial disputes and governments
actions, which are beyond its reasonable control: provided that
the delayed party: (i) gives the other party written notice of
such cause promptly, and in any event within fourteen (14) days
of discovery thereof; and (ii) uses its reasonable efforts to
correct such failure or delay in its performance. The delayed
party’s time for performance or cure under this Clause 20.4
shall be extended for a period equal to the duration of the
cause.

Page 20

 

	20.5	 	ARM and LGS are independent parties. Neither company nor their
employees, consultants, contractors or agents, are agents,
employees or joint venturers of the other party, nor do they
have the authority to bind the other party by contract or
otherwise to any obligation. Neither party will represent to the
contrary, either expressly, implicitly, by appearance or
otherwise.
	 
	20.6	 	The parties agree that the terms and conditions of this
Agreement shall be treated as Confidential Information hereunder
and shall not be disclosed without the consent of both parties.
	 
	20.7	 	Failure by either party to enforce any provision of this
Agreement shall not be deemed a waiver of future enforcement of
that or any other provision.
	 
	20.8	 	If any provision of this Agreement, or portion thereof, is
determined to be invalid or unenforceable the same will be
enforced to the maximum extent permissible so as to effect the
intent of the parties, and the remainder of this Agreement will
continue in full force and effect.
	 
	20.9	 	The headings to the Clauses of this Agreement are for ease of
reference only and shall not affect the interpretation or
construction of this Agreement.
	 
	20.10	 	This Agreement may be executed in one or more counterparts each
of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
	 
	20.11	 	This Agreement, including all Schedules and documents
referenced herein, constitutes the entire agreement between the
parties with respect to the subject matter hereof, and
supersedes and replaces all prior or contemporaneous
understandings or agreements, written or oral, regarding the
subject matter. No amendment to, or modification of, this
Agreement shall be binding unless in writing and signed by a
duly authorised representative of both parties.
	 
	20.12	 	This Agreement shall be governed by and construed in accordance
with the laws of England. In the event that ARM commences
proceedings against LGS under this Agreement, the parties agree
to submit to the jurisdiction of the Seoul District Court,
Korea, for the purpose of hearing and determining any disputes
arising out of this Agreement. In the event that LGS commences
proceedings against ARM under this Agreement, the parties agree
to submit to the jurisdiction of the High Court of Justice,
London, England, for the purpose of hearing and determining any
disputes arising out of this Agreement.

	 	 	IN WITNESS WHEREOF the parties have caused this Agreement to be executed by their duly
authorised representative:

	 	 	 	 	 	 	 	 	 
	ADVANCED RISC MACHINES LIMITED:	 	LG SEMICON COMPANY LIMITED:	 	 
	 
	 	 	 	 	 	 	 	 
	SIGNED:

	 	/s/ R. K. Saxby
 

	 	SIGNED:
	 	/s/ B. D. Sun
 

	 	 
	 
	 	 	 	 	 	 	 	 
	NAME:

	 	R. K. Saxby
	 	NAME:
	 	Byung-Don Sun	 	 
	 
	 	 	 	 	 	 	 	 
	TITLE:

	 	President & CEO
	 	TITLE:
	 	Executive Vice President	 	 

Page 21exv10w10

Exhibit 10.10

					
	12 October, 2006
	 	Confidential
	 	LEC-LTM-01434-V5.0

This amendment (“Amendment”) is effective from the 16th of October 2006 (“Effective Date”)

BETWEEN

ARM LIMITED whose registered office is situated at 110 Fulbourn Road, Cambridge CB1 9NJ, United Kingdom
(“ARM”);

and

MAGNACHIP SEMICONDUCTOR LTD whose principal place of business is situated at 891 Daechi-dong,
Gangnam-gu, Seoul 135-738, Seoul, Korea (“MAGNACHIP”)

WHEREAS

	A.	 	This Amendment (defined above) refers to and amends the terms and conditions of the technology licence
agreement, ARM document number LEC-TLA-00142, between ARM and MAGNACHIP dated 16th
December 1996 (the “Agreement”).
	 
	B.	 	The Agreement was assigned by LG Semicon Company Limited to Hyundai Electronics Ltd (“Hyundai”) in
the month of March 2000.
	 
	C.	 	Hyundai changed its name to Hynix Semiconductor Inc (“Hynix”) on 29th March 2001.
	 
	D.	 	MAGNACHIP purchased the system IC business of Hynix on 6th October 2004 and the Agreement was
assigned to MAGNACHIP.
	 
	E.	 	MAGNACHIP has requested and ARM has agreed to license an additional model to MAGNACHIP under
the terms and conditions of the Agreement.

IT IS AGREED AS FOLLOWS:

	1.	 	That all definitions contained in the Agreement shall have the same meanings and apply to this Amendment.
	 
	2.	 	Delete the following from Clause 1.22(iii) of the Agreement
	 
	 	 	“subject to the payment by MAGNACHIP of the fee(s) set out in Clause 9.2”
	 
	 	 	and replace with the following:
	 
	 	 	“subject to the payment by MAGNACHIP of the fee(s) set out in Clauses 9.6a, 9.6b and 9.6c as applicable”
	 
	3.	 	After Clause 9.6, add Clauses 9.6a and 9.6b to the Agreement as follows:

	 	 	 	 	 
	 

	 	“9.6a
	 	In consideration of ARM agreeing to licence the Model identified in Schedule 3 Part C Item C7 to
MAGNACHIP, MAGNACHIP shall pay, to ARM, the sum of [*****]
due on the Effective Date of the Amendment.
	 
	 	 	 	 
	 

	 	9.6b
	 	In consideration of ARM agreeing to provide support and maintenance services to MAGNACHIP in
respect of the Model identified in Schedule 3 Part C Item C7, MAGNACHIP shall pay, to ARM, the
[******] due on the Effective Date of the Amendment.
	 
	 	 	 	 
	 

	 	9.6c
	 	In the event that MAGNACHIP exercises its option in Clause 13.1b, MAGNACHIP shall pay, to
ARM, the sum of [*****] (“Model Optional Support and
Maintenance Fee”) due on the first anniversary of the Effective Date of the Amendment.”

					
	 	 	 	 	 
	NM/JL
	 	Page 1 of 2
	 	ARM/Magnachip Semiconductor Limited

 

			
	[*****] 	 -	 Portions of this exhibit are subject to a request for confidential treatment and
have been redacted and filed separately with the Securities and Exchange Commission.

 

					
	 	 	 	 	 
	12 October, 2006
	 	Confidential
	 	LEC-LTM-O1434-V5.0

	4.	 	After Clause 13.1 of the Agreement, add Clause 13.1a to the Agreement as follows:

	 	 	 	 	 
	 

	 	“13.1a
	 	Notwithstanding anything to the contrary contained in Clause 13.1, for the period commencing on
the Effective Date of the Amendment and ending one (1) year thereafter, ARM shall provide support
and maintenance to MAGNACHIP pursuant to this Clause 13 in respect of the Model identified in
Schedule 3 Part C Item C7.
	 
	 	 	 	 
	 

	 	13.1b
	 	Subject to receipt of notice from MAGNACHIP requesting support and maintenance and payment
of the Model Optional Support and Maintenance Fee (defined in Clause 9.6c), for the period
commencing on the first anniversary of the Effective Date of the Amendment and ending one (1)
year thereafter, ARM shall provide support and maintenance to MAGNACHIP pursuant to this
Clause 13 in respect of the Model identified in Schedule 3 Part C Item C7.”

	5.	 	Add the following to the end of Schedule 3 Part C of the Agreement:

	 	 	 	 	 	 	 	 	 
	C7

	 	AT010-MS-28607
	 	ARM7TDMI Model
	 	NC-Verilog simulator on Linux

platform
	 	N

The terms contained herein are agreed and accepted by the authourised signatories of the respective partics:

	 	 	 	 	 	 	 	 	 	 	 
	ARM LIMITED

	 	 	 	 	 	MAGNACHIP
	 	SEMICONDUCTOR LTD	 	 
	 
	BY

	 	/s/
 

	 	 	 	BY
	 	/s/ David J Gampell
 

	 	 
	NAME

	 	 	 	 	 	NAME
	 	DAVID J GAMPELL	 	 
	TITLE

	 	EVP	 	 	 	TITLE
	 	VP ENGINEERING, ISO	 	 
	DATE

	 	7/11/06	 	 	 	DATE
	 	16 OCT 2006	 	 

     

					
	 	 	 	 	 
	NM/JL
	 	Page 2 of 2
	 	ARM/Magnachip Semiconductor Limited

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00170-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00170-of-00352.parquet"}]]