Document:

exv10w2

 

Exhibit 10.2

  

EXECUTION VERSION

REGISTRATION RIGHTS AGREEMENT

     REGISTRATION RIGHTS AGREEMENT dated as of June 5, 2007 (this “Agreement”) between NII
Holdings, Inc., a Delaware corporation (the “Company”) and the several parties named in Schedule I
hereto (the “Initial Purchasers”) pursuant to the Purchase Agreement dated May 30, 2007 (the
“Purchase Agreement”), between the Company and the Initial Purchasers. In order to induce the
Initial Purchasers to enter into the Purchase Agreement, the Company has agreed to provide the
registration rights set forth in this Agreement. The execution of this Agreement is a condition to
the closing under the Purchase Agreement.

     The Company agrees with each of the Initial Purchasers, (i) for their benefit as Initial
Purchasers and (ii) for the benefit of the beneficial owners (including the Initial Purchasers)
from time to time of the Notes (as defined herein) and the beneficial owners from time to time of
the Underlying Common Stock (as defined herein) issued upon conversion of the Notes (each of the
foregoing a “Holder” and together the “Holders”), as follows:

          SECTION 1. Definitions. Capitalized terms used herein without definition shall have their respective meanings set
forth in the Purchase Agreement. As used in this Agreement, the following terms shall have the
following meanings:

     “Amendment Effectiveness Deadline Date” has the meaning set forth in Section 2(d) hereof.

     “Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on
which banking institutions in The City of New York are authorized or obligated by law or executive
order to close.

     “Common Stock” means the shares of common stock, par value $.001 per share, of the Company and
any other shares of common stock as may constitute “Common Stock” for purposes of the Indenture,
including the Underlying Common Stock.

     “Company” has the meaning set forth in the preamble hereof.

     “Conversion Price” has the meaning assigned to such term in the Indenture.

     “Damages Accrual Period” has the meaning set forth in Section 2(e) hereof.

     “Damages Payment Date” means each June 15 and December 15, except as provided in Section
2(e)(B)(i).

     “Deferral Notice” has the meaning set forth in Section 3(h) hereof.

     “Deferral Period” has the meaning set forth in Section 3(h) hereof.

     “Effectiveness Deadline Date” has the meaning set forth in Section 2(a) hereof.

     “Effectiveness Period” means the period commencing on the date hereof and ending on the date
that all Registrable Securities have ceased to be Registrable Securities.

     “Event” has the meaning set forth in Section 2(e) hereof.

 

 

     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the SEC promulgated thereunder.

     “Filing Deadline Date” has the meaning set forth in Section 2(a) hereof.

     “Holder” has the meaning set forth in the second paragraph of this Agreement.

     “Indenture” means the Indenture, dated as of June 5, 2007, between the Company and Wilmington
Trust Company, as trustee, pursuant to which the Notes are being issued.

     “Initial Purchasers” has the meaning set forth in the preamble hereof.

     “Initial Shelf Registration Statement” has the meaning set forth in Section 2(a) hereof.

     “Issue Date” means June 5, 2007.

     “Liquidated Damages Amount” has the meaning set forth in Section 2(e) hereof.

     “Material Event” has the meaning set forth in Section 3(h) hereof.

     “Notes” means the 3.125% Convertible Notes Due 2012 of the Company to be purchased pursuant to
the Purchase Agreement.

     “Notice and Questionnaire” means a written notice delivered to the Company containing
substantially the information called for by the Selling Securityholder Notice and Questionnaire
attached as Annex A to the Offering Memorandum of the Company dated May 30, 2007 relating to the
Notes.

     “Notice Holder” means, on any date, any Holder that has delivered a Notice and Questionnaire
to the Company on or prior to such date.

     “Purchase Agreement” has the meaning set forth in the preamble hereof.

     “Prospectus” means the prospectus included in any Registration Statement (including, without
limitation, a prospectus that discloses information previously omitted from a prospectus filed as
part of an effective registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any amendment, prospectus supplement or any free
writing prospectus (as defined in Rule 405 under the Securities Act), including post-effective
amendments, and all materials incorporated by reference or explicitly deemed to be incorporated by
reference in such Prospectus.

     “Record Holder” means, with respect to any Damages Payment Date relating to any Notes or
Underlying Common Stock as to which any Liquidated Damages Amount has accrued, the registered
holder of such Note or Underlying Common Stock on the June 1 immediately preceding a Damages
Payment Date occurring on a June 15, and on the December 1 immediately preceding a Damages Payment
Date occurring on a December 15.

     “Registrable Securities” means the Notes until such Notes have been converted into or
exchanged for the Underlying Common Stock and, at all times subsequent to any such conversion, the
Underlying Common Stock and any securities into or for which such Underlying Common Stock has
been converted or exchanged, and any security issued with respect thereto upon any stock dividend,
split or similar event until, in the case of any such security, (A) the earliest of (i) its
effective registration under the Securities Act and resale in accordance with the Registration
Statement covering it, (ii) expiration of

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the holding period that would be applicable thereto, under Rule 144(k) or (iii) its sale to the public pursuant to Rule 144 (or any similar provision
then in force, but not Rule 144A) under the Securities Act, and (B) as a result of the event or
circumstance described in any of the foregoing clauses (i) through (iii), the legend with respect
to transfer restrictions required under the Indenture is removed or removable in accordance with
the terms of the Indenture or such legend, as the case may be. Throughout this Agreement, for
purposes of determining the holders of a majority of Registrable Securities, Registrable Securities
shall be the shares of Underlying Common Stock and Holders of Notes shall be deemed to be the
Holders of the number of shares of Underlying Common Stock into which such Notes are or would be
convertible as of the date the consent is requested.

     “Registration Statement” means any registration statement of the Company that covers any of
the Registrable Securities pursuant to the provisions of this Agreement, including the Prospectus,
amendments and supplements to such registration statement, including post-effective amendments, all
exhibits and all materials incorporated by reference or explicitly deemed to be incorporated by
reference in such registration statement.

     “Rule 144” means Rule 144 under the Securities Act, as such Rule may be amended from time to
time, or any similar rule or regulation hereafter adopted by the SEC.

     “Rule 144A” means Rule 144A under the Securities Act, as such Rule may be amended from time to
time, or any similar rule or regulation hereafter adopted by the SEC.

     “SEC” means the Securities and Exchange Commission.

     “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations
promulgated by the SEC thereunder.

     “Shelf Registration Statement” has the meaning set forth in Section 2(a) hereof.

     “Special Counsel” means Shearman & Sterling LLP or one such other successor counsel as shall
be specified by the Holders of a majority of all Registrable Securities, but which may, with the
written consent of the Initial Purchasers (which shall not be unreasonably withheld), be another
nationally recognized law firm experienced in securities law matters designated by the Company, the
reasonable fees and expenses of which will be paid by the Company pursuant to Section 5 hereof.

     “Subsequent Shelf Registration Statement” has the meaning set forth in Section 2(b) hereof.

     “Trustee” means Wilmington Trust Company, the trustee under the Indenture.

     “Underlying Common Stock” means the Common Stock into which the Notes are convertible or
issued upon any such conversion.

     “Well-Known Seasoned Issuer” or “WKSI” has the meaning set forth in Rule 405 under the
Securities Act.

     “WKSI Shelf Registration Statement” means an automatically effective registration statement
for an offering of the Company’s securities to be made on a delayed or continuous basis pursuant to
Rule 415 under the Securities Act filed by the Company with the SEC.

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          SECTION 2. Shelf Registration. (a) The Company shall prepare and file or cause to be prepared and filed with the SEC, as
soon as practicable but in any event by the date (the “Filing Deadline Date”) ninety (90) days
after the Issue Date, a Registration Statement for an offering to be made on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act (a “Shelf Registration Statement”)
registering the resale from time to time by Holders thereof of all of the Registrable Securities
(the “Initial Shelf Registration Statement”); provided, however, that if the Initial Shelf
Registration Statement is a WKSI Shelf Registration Statement, the Company shall prepare and file
or cause to be prepared and file with the SEC such WKSI Shelf Registration Statement by the
Effectiveness Deadline Date (as defined below). The Initial Shelf Registration Statement shall be
on Form S-3 or another appropriate form permitting registration of such Registrable Securities for
resale by such Holders in accordance with the methods of distribution elected by the Holders and
set forth in the Initial Shelf Registration Statement. If the Initial Shelf Registration Statement
is not a WKSI Shelf Registration Statement, the Company shall use its reasonable best efforts to
cause the Initial Shelf Registration Statement to be declared effective under the Securities Act as
promptly as is practicable but in any event by the date (the “Effectiveness Deadline Date”) that is
one hundred eighty (180) days after the Issue Date. Except as otherwise provided herein, the
Company shall use its reasonable best efforts to keep the Initial Shelf Registration Statement (or
any Subsequent Shelf Registration Statement) continuously effective under the Securities Act until
the expiration of the Effectiveness Period. At the time the Initial Shelf Registration Statement
is declared effective, each Holder that became a Notice Holder on or prior to the date ten (10)
Business Days prior to such time of effectiveness shall be named as a selling securityholder in the
Initial Shelf Registration Statement and the related Prospectus in such a manner as to permit such
Holder to deliver such Prospectus to purchasers of Registrable Securities in accordance with
applicable law. None of the Company’s security holders (other than the Holders of Registrable
Securities) shall have the right to include any of the Company’s securities in the Shelf
Registration Statement, except as may be described in the Offering Memorandum of the Company dated
May 30, 2007.

     (b) If the Initial Shelf Registration Statement or any Subsequent Shelf Registration Statement
ceases to be effective for any reason at any time during the Effectiveness Period (other than
because all Registrable Securities registered thereunder shall have been resold pursuant thereto or
shall have otherwise ceased to be Registrable Securities), the Company shall use its reasonable
best efforts to obtain the prompt withdrawal of any order suspending the effectiveness thereof, and
in any event shall within thirty (30) days of such cessation of effectiveness amend the Shelf
Registration Statement in a manner reasonably expected to obtain the withdrawal of the order
suspending the effectiveness thereof, or file an additional Shelf Registration Statement (a
“Subsequent Shelf Registration Statement”) covering all of the securities that as of the date of
such filing are Registrable Securities. If a Subsequent Shelf Registration Statement is filed and
is not a WKSI Shelf Registration Statement, the Company shall use its reasonable best efforts to
cause the Subsequent Shelf Registration Statement to become effective as promptly as is practicable
after such filing. The Company shall use its reasonable best efforts to keep such Registration
Statement (or Subsequent Shelf Registration Statement) continuously effective until the expiration
of the Effectiveness Period.

     (c) The Company shall supplement and amend the Shelf Registration Statement if required by the
rules, regulations or instructions applicable to the registration form used by the Company for such
Shelf Registration Statement or as otherwise required by the Securities Act or as necessary to
name a Notice Holder as a selling securityholder pursuant to Section 2(d) below.

     (d) Each Holder agrees that if such Holder wishes to sell Registrable Securities pursuant to a
Shelf Registration Statement and related Prospectus, it will do so only in accordance with this
Section 2(d) and Section 3(h). Following the date that the Initial Shelf Registration Statement
becomes or is declared effective, each Holder wishing to sell Registrable Securities pursuant to a
Shelf Registration

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Statement and related Prospectus agrees to deliver a Notice and Questionnaire to
the Company at least three (3) Business Days prior to any intended distribution of Registrable
Securities under the Shelf Registration Statement. Each Holder who elects to sell Registrable
Securities pursuant to a Shelf Registration Statement agrees, by submitting a Notice and
Questionnaire to the Company, it will be bound by the terms and conditions of the Notice and
Questionnaire and this Agreement. From and after the date the Initial Shelf Registration Statement
becomes or is declared effective, the Company shall, as promptly as practicable after the date a
Notice and Questionnaire is delivered pursuant to Section 9(c) hereof, and in any event upon the
later of (x) seven (7) Business Days after such date or (y) seven (7) Business Days after the
expiration of any Deferral Period that is in effect when the Notice and Questionnaire is delivered
or that is put into effect within seven (7) Business Days of such delivery date:

     (i) if required by applicable law, file with the SEC a post-effective amendment to the
Shelf Registration Statement or prepare and, if required by applicable law, file a
supplement to the related Prospectus or a supplement or amendment to any document
incorporated therein by reference or file any other required document so that the Holder
delivering such Notice and Questionnaire is named as a selling securityholder in the Shelf
Registration Statement and the related Prospectus in such a manner as to permit such Holder
to deliver such Prospectus to purchasers of the Registrable Securities in accordance with
applicable law and, if the Company shall file a post-effective amendment to the Shelf
Registration Statement and such post-effective amendment is not a WKSI Shelf Registration
Statement, use its reasonable best efforts to cause such post-effective amendment to be
declared effective under the Securities Act as promptly as is practicable, but in any event
by the date (the “Amendment Effectiveness Deadline Date”) that is sixty (60) days after the
date such post-effective amendment is required by this clause to be filed; and

     (ii) provide such Holder copies of any documents filed pursuant to Section 2(d)(i);
provided that if such Notice and Questionnaire is delivered during a Deferral Period, the
Company shall so inform the Holder delivering such Notice and Questionnaire. The Company
shall notify such Holder as promptly as practicable after the effectiveness under the
Securities Act of any post-effective amendment filed pursuant to Section 2(d)(i).
Notwithstanding anything contained herein to the contrary, (i) the Company shall be under no
obligation to name any Holder that is not a Notice Holder as a selling securityholder in any
Registration Statement or related Prospectus and (ii) the Amendment Effectiveness Deadline
Date shall be extended by up to seven (7) Business Days from the expiration of a Deferral
Period (and the Company shall incur no obligation to pay Liquidated Damages during such
extension or during such Deferral Period) if such Deferral Period shall be in effect on the
Amendment Effectiveness Deadline Date.

     (e) The parties hereto agree that the Holders of Registrable Securities will suffer damages,
and that it would not be feasible to ascertain the extent of such damages with precision, if, other
than as permitted hereunder:

     (i) unless the Initial Shelf Registration Statement is a WKSI Shelf Registration
Statement, the Initial Shelf Registration Statement has not been filed on or prior to the
Filing Deadline Date;

     (ii) the Initial Shelf Registration Statement has not become or been declared effective
under the Securities Act on or prior to the Effectiveness Deadline Date;

     (iii) the Company has failed to perform its obligations set forth in Section 2(d)(i)
within the time period required therein;

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     (iv) any post-effective amendment to a Shelf Registration Statement filed pursuant to
Section 2(d)(i) has not become effective under the Securities Act on or prior to the
Amendment Effectiveness Deadline Date; or

     (v) the aggregate duration of Deferral Periods in any period exceeds the number of days
permitted in respect of such periods pursuant to Section 3(h) hereof.

Each event described in any of the foregoing clauses (i) through (v) is individually referred to
herein as an “Event.” For purposes of this Agreement, each Event set forth above shall begin and
end on the dates set forth in the table below:

	 	 	 	 	 
	Type of	 	 	 	 
	Event by	 	Beginning	 	Ending
	Clause	 	Date	 	Date
	(i)

	 	Filing Deadline Date
	 	the date the Initial
Shelf Registration
Statement is filed
	 
	 	 	 	 
	(ii)

	 	Effectiveness Deadline Date
	 	the date the Initial
Shelf Registration
Statement becomes or
is declared effective
under the Securities
Act
	 
	 	 	 	 
	(iii)

	 	the date by which the Company
is required to perform its
obligations under Section
2(d)
	 	the date the Company
performs its
obligations set forth
in Section 2(d)
	 
	 	 	 	 
	(iv)

	 	the Amendment Effectiveness
Deadline Date
	 	the date the
applicable
post-effective
amendment to a Shelf
Registration Statement
becomes effective
under the Securities
Act
	 
	 	 	 	 
	(v)

	 	the date on which the
aggregate duration of
Deferral Periods in any
period exceeds the number of
days permitted by Section
3(h)
	 	termination of the
Deferral Period that
caused the limit on
the aggregate duration
of Deferral Periods to
be exceeded

For purposes of this Agreement, Events shall begin on the dates set forth in the table above and
shall continue until the ending dates set forth in the table above.

     Commencing on (and including) any date that an Event has begun and ending on (but excluding)
the next date on which there are no Events that have occurred and are continuing (a “Damages
Accrual Period”), the Company shall pay interest (“Liquidated Damages Amount”), as liquidated damages
and not as a penalty, to Record Holders of Registrable Securities, or shall issue additional shares
of Common Stock, as applicable, as set forth below:

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	 	(A)	 	in respect of any Note that is a Registrable Security, the Company agrees to
pay interest accruing for each day in the Damages Accrual Period at a rate per annum
equal to 0.5% of the principal amount of such Note;
	 
	 	(B)	 	in respect of any Note that is a Registrable Security and is submitted by a
Holder for conversion into Underlying Common Stock during a Damages Accrual Period, the
Company agrees (i) to pay on the settlement date in respect to such conversion,
interest accruing for each day commencing on (and including) the first day of such
Damages Accrual Period and ending on (but excluding) such settlement date at a rate per
annum equal to 0.5% of the principal amount of such Note and (ii) to issue and deliver
in respect of each $1,000 principal amount of Notes submitted for conversion,
additional shares of Underlying Common Stock equal to 1% of the Applicable Conversion
Rate (as defined in the Indenture) (except to the extent the Company elects to deliver
cash upon conversion in accordance with terms of the Indenture); and
	 
	 	(C)	 	in respect of Common Stock, each Holder of such Common Stock will not be
entitled to any Liquidated Damages Amount;

provided that in the case of a Damages Accrual Period that is in effect solely as a result of an
Event of the type described in clause (iii) or (iv) of the preceding paragraph, such Liquidated
Damages Amount shall be paid only to the Holders (as set forth in the succeeding paragraph) that
have delivered Notices and Questionnaires that caused the Company to incur the obligations set
forth in Section 2(d) the non-performance of which is the basis of such Event. Notwithstanding the
foregoing, no Liquidated Damages Amount shall accrue as to any Registrable Security from and after
the earlier of (x) the date such security is no longer a Registrable Security and (y) expiration of
the Effectiveness Period. The rate of accrual of the Liquidated Damages Amount with respect to any
period shall not exceed the rate provided for in this paragraph notwithstanding the occurrence of
multiple concurrent Events.

     The Liquidated Damages Amount shall accrue from the first day of the applicable Damages
Accrual Period, and shall be payable on each Damages Payment Date during the Damage Accrual Period
(and on the Damages Payment Date next succeeding the end of the Damages Accrual Period if the
Damage Accrual Period does not end on a Damages Payment Date) to the Record Holders of the
Registrable Securities entitled thereto; provided that any Liquidated Damages Amount accrued with
respect to any Note or portion thereof redeemed by the Company on a redemption date or converted
into Underlying Common Stock on a conversion date prior to the Damages Payment Date, shall, in any
such event, be paid instead to the Holder who submitted such Note or portion thereof for redemption
or conversion on the applicable redemption date or settlement date with respect to such conversion,
as the case may be, on such date (such settlement date promptly following the conversion date, in
the case of conversion); provided further that, in the case of an Event of the type described in
clause (iii) or (iv) of the first paragraph of this Section 2(e), such Liquidated Damages Amount
shall be paid only to the Holders entitled thereto pursuant to such first paragraph by check mailed
to the address set forth in the Notice and Questionnaire delivered by such Holder. Any shares of
Underlying Common Stock that are payable pursuant to Section 2(e)(B)(ii) herein will be payable on
the date on which other shares of Underlying Common Stock otherwise deliverable are required to be
delivered by the Company pursuant to Section 14.02 of the Indenture. The Trustee shall be
entitled, on behalf of registered holders of Notes or Underlying Common Stock, to seek any
available remedy for the enforcement of this Agreement, including for the payment of such
Liquidated Damages Amount. Notwithstanding the foregoing, the parties agree that the sole damages payable for a violation of the terms of this Agreement
with respect to which liquidated damages are expressly provided shall be such liquidated damages.
Nothing shall preclude any Holder from pursuing or obtaining specific performance or other
equitable relief with respect to this Agreement in accordance with applicable law.

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     All of the Company’s obligations set forth in this Section 2(e) that are outstanding with
respect to any Registrable Security at the time such security ceases to be a Registrable Security
shall survive until such time as all such obligations with respect to such security have been
satisfied in full (notwithstanding termination of this Agreement pursuant to Section 9(k)).

     The parties hereto agree that the liquidated damages provided for in this Section 2(e)
constitute a reasonable estimate of the damages that may be incurred by Holders of Registrable
Securities by reason of the failure of the Shelf Registration Statement to be filed or to become or
be declared effective or available for effecting resales of Registrable Securities in accordance
with the provisions hereof.

          SECTION 3. Registration Procedures. In connection with the registration obligations of the Company under Section 2 hereof,
during the Effectiveness Period, the Company shall:

     (a) Prepare and file with the SEC a Shelf Registration Statement or Shelf Registration
Statements on any appropriate form under the Securities Act available for the sale of the
Registrable Securities by the Holders thereof in accordance with the intended method or methods of
distribution thereof, and use its reasonable best efforts to cause each such Shelf Registration
Statement to become effective and remain effective as provided herein; provided that before filing
any Shelf Registration Statement or Prospectus or any amendments or supplements thereto with the
SEC (but excluding reports filed with the SEC under the Exchange Act), furnish to the Initial
Purchasers and the Special Counsel, if any, copies of all such documents proposed to be filed at
least three (3) Business Days prior to the filing of such Shelf Registration Statement or amendment
thereto or Prospectus or supplement thereto.

     (b) Subject to Section 3(h), prepare and file with the SEC such amendments and post-effective amendments to each Shelf Registration Statement as may be necessary to keep
such Shelf Registration Statement continuously effective for the applicable period specified in
Section 2(a); cause the related Prospectus to be supplemented by any required prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 (or any similar provisions then
in force) under the Securities Act; and use its reasonable best efforts to comply with the
provisions of the Securities Act applicable to it with respect to the disposition of all securities
covered by such Shelf Registration Statement during the Effectiveness Period in accordance with the
intended methods of disposition by the sellers thereof set forth in such Shelf Registration
Statement as so amended or such Prospectus as so supplemented.

     (c) As promptly as practicable give notice to the Notice Holders, the Initial Purchasers and
the Special Counsel, if any (i) when any Prospectus, prospectus supplement, Registration Statement
or post-effective amendment to a Registration Statement has been filed with the SEC and, with
respect to a Shelf Registration Statement or any post-effective amendment, when the same has been
declared effective, (ii) of any request, following the effectiveness of the Initial Shelf
Registration Statement under the Securities Act, by the SEC or any other federal or state
governmental authority for amendments or supplements to any Shelf Registration Statement or related
Prospectus or for additional information relating to the Shelf Registration Statement, (iii) of the
issuance by the SEC or any other federal or state governmental authority of any stop order
suspending the effectiveness of any Shelf Registration Statement or the initiation or threatening
of any proceedings for that purpose, (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose, (v) of the occurrence of, but not the
nature of or details concerning, a Material Event and (vi) of the determination by the Company that
a post-effective amendment to a Shelf Registration Statement will be filed with the SEC, which
notice may, at the discretion of the Company (or as required pursuant to Section 3(h)), state that
it constitutes a Deferral Notice, in which event the provisions of Section 3(h) shall apply.

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     (d) Use its reasonable best efforts to obtain the withdrawal of any order suspending the
effectiveness of a Shelf Registration Statement or the lifting of any suspension of the
qualification (or exemption from qualification) of any of the Registrable Securities for sale in
any jurisdiction in which they have been qualified for sale, in either case at the earliest
possible moment, and provide immediate notice to each Notice Holder and the Initial Purchasers of
the withdrawal of any such order.

     (e) As promptly as practicable furnish to each Notice Holder, the Special Counsel, if any, and
the Initial Purchasers, upon request and without charge, at least one (1) conformed copy of the
Registration Statement and any amendment thereto, including exhibits and, if requested, all
documents incorporated or deemed to be incorporated therein by reference.

     (f) Deliver to each Notice Holder, the Special Counsel, if any, and the Initial Purchasers, in
connection with any sale of Registrable Securities pursuant to a Registration Statement, without
charge, as many copies of the Prospectus relating to such Shelf Registrable Securities (including
each preliminary prospectus) and any amendment or supplement thereto as such persons may reasonably
request; and the Company hereby consents (except during such periods that a Deferral Notice is
outstanding and has not been revoked) to the use of such Prospectus or each amendment or supplement
thereto by each Notice Holder in connection with any offering and sale of the Registrable
Securities covered by such Prospectus or any amendment or supplement thereto in the manner set
forth therein.

     (g) Prior to any public offering of the Registrable Securities pursuant to a Shelf
Registration Statement, use its reasonable best efforts to register or qualify or cooperate with
the Notice Holders and the Special Counsel, if any, in connection with the registration or
qualification (or exemption from such registration or qualification) of such Registrable Securities
for offer and sale under the securities or Blue Sky laws of such jurisdictions within the United
States as any Notice Holder reasonably requests in writing (which request may be included in the
Notice and Questionnaire); prior to any public offering of the Registrable Securities pursuant to
the Shelf Registration Statement, use its reasonable best efforts to keep each such registration or
qualification (or exemption therefrom) effective during the Effectiveness Period in connection with
such Notice Holder’s offer and sale of Registrable Securities pursuant to such registration or
qualification (or exemption therefrom) and do any and all other acts or things reasonably necessary
or advisable to enable the disposition in such jurisdictions of such Registrable Securities in the
manner set forth in the relevant Shelf Registration Statement and the related Prospectus; provided
that the Company will not be required to (i) qualify as a foreign corporation or as a dealer in
securities in any jurisdiction where it would not otherwise be required to qualify but for this
Agreement or (ii) take any action that would subject it to general service of process or to
taxation in any such jurisdiction where it is not then so subject.

     (h) Upon (A) the issuance by the SEC of a stop order suspending the effectiveness of any Shelf
Registration Statement or the initiation of proceedings with respect to any Shelf Registration
Statement under Section 8(d) or 8(e) of the Securities Act, (B) the occurrence of any event or the
existence of any fact (a “Material Event”) as a result of which any Shelf Registration Statement
shall contain any untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading, or any Prospectus
shall contain any untrue statement of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the circumstances under which
they were made, not misleading, or (C) the occurrence or existence of any pending corporate
development that, in the reasonable discretion of the Company, makes it appropriate to suspend the
availability of any Shelf Registration Statement and the related Prospectus:

     (i) in the case of clause (B) above, subject to the next sentence, as promptly as
practicable prepare and file, if necessary pursuant to applicable law, a post-effective
amendment

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to such Shelf Registration Statement or a supplement to the related Prospectus or
any document incorporated therein by reference or file any other required document that
would be incorporated by reference into such Shelf Registration Statement and Prospectus so
that such Shelf Registration Statement does not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary to make
the statements therein not misleading, and such Prospectus does not contain any untrue
statement of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, and, in the case of a post-effective amendment
to a Shelf Registration Statement, subject to the next sentence, provided such
post-effective amendment is not a WKSI Shelf Registration Statement, use its reasonable best
efforts to cause it to be declared effective as promptly as is practicable, and

     (ii) give notice to the Notice Holders and the Special Counsel, if any, that the
availability of the Shelf Registration Statement is suspended (a “Deferral Notice”) and,
upon receipt of any Deferral Notice, each Notice Holder agrees not to sell any Registrable
Securities pursuant to the Shelf Registration Statement until such Notice Holder’s receipt
of copies of the supplemented or amended Prospectus provided for in clause (i) above, or
until it is advised in writing by the Company that the Prospectus may be used, and has
received copies of any additional or supplemental filings that are incorporated or deemed
incorporated by reference in such Prospectus.

The Company will use its reasonable best efforts to ensure that the use of the Prospectus may be
resumed (x) in the case of clause (A) above, as promptly as is practicable, (y) in the case of
clause (B) above, as soon as, in the sole judgment of the Company, public disclosure of such
Material Event would not be prejudicial to or contrary to the interests of the Company or, if
necessary to avoid unreasonable burden or expense, as soon as practicable thereafter, and (z) in
the case of clause (C) above, as soon as, in the reasonable discretion of the Company, such
suspension is no longer appropriate. The Company shall be entitled to exercise its right under
this Section 3(h) to suspend the availability of any Shelf Registration Statement or any
Prospectus, without incurring or accruing any obligation to pay liquidated damages pursuant to
Section 2(e) (the “Deferral Period”); provided that the aggregate duration of any Deferral Periods
shall not exceed 30 days in any three month period (or 60 days in any three month period in the
event of a Material Event pursuant to which the Company has delivered a second notice as required
below) or 90 days in any twelve (12) month period; provided that in the case of a Material Event
relating to an acquisition or a probable acquisition or financing, recapitalization, business
combination or other similar transaction, the Company may, without incurring any obligation to pay
liquidated damages pursuant to Section 2(e), deliver to Notice Holders a second notice to the
effect set forth above, which shall have the effect of extending the Deferral Period by up to an
additional 30 days, or such shorter period of time as is specified in such second notice.

     (i) If reasonably requested in writing in connection with a disposition of Registrable
Securities pursuant to a Shelf Registration Statement, make reasonably available for inspection
during normal business hours by a representative for the Notice Holders of such Registrable
Securities, any broker-dealers, underwriters, attorneys and accountants retained by such Notice Holders, and
any attorneys or other agents retained by a broker-dealer or underwriter engaged by such Notice
Holders, all relevant financial and other records and pertinent corporate documents and properties
of the Company and its subsidiaries, and cause the appropriate officers, directors and employees of
the Company and its subsidiaries to make reasonably available for inspection during normal business
hours on reasonable notice all relevant information reasonably requested by such representative for
the Notice Holders, or any such broker-dealers, underwriters, attorneys or accountants in
connection with such disposition, in each case as is customary for similar “due diligence”
examinations; provided that such persons shall first agree

10

 

in writing with the Company that any information that is reasonably designated by the Company as confidential at the time of delivery of
such information shall be kept confidential by such persons and shall be used solely for the
purposes of exercising rights under this Agreement, unless (i) disclosure of such information is
required by court or administrative order or is necessary to respond to inquiries of regulatory
authorities, (ii) disclosure of such information is required by law (including any disclosure
requirements pursuant to federal securities laws in connection with the filing of any Shelf
Registration Statement or the use of any Prospectus referred to in this Agreement), (iii) such
information becomes generally available to the public other than as a result of a disclosure or
failure to safeguard by any such person or (iv) such information becomes available to any such
person from a source other than the Company and such source is not bound by a confidentiality
agreement; and provided further that the foregoing inspection and information gathering shall, to
the greatest extent possible, be coordinated on behalf of all the Notice Holders and the other
parties entitled thereto by Special Counsel, if any, or another representative selected by a
majority of Registrable Securities being sold by such Holders pursuant to such Shelf Registration
Statement. Any person legally compelled or required by administrative or court order or by a
regulatory authority to disclose any such confidential information made available for inspection
shall provide the Company with prompt prior written notice of such requirement so that the Company
may seek a protective order or other appropriate remedy.

     (j) Comply with all applicable rules and regulations of the SEC and make generally available
to its securityholders earning statements (which need not be audited) satisfying the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under
the Securities Act) for a 12-month period commencing on the first day of the first fiscal quarter
of the Company commencing after the effective date of a Shelf Registration Statement, which
statements shall be made available no later than 45 days after the end of the 12-month period or 90
days if the 12-month period coincides with the fiscal year of the Company.

     (k) Cooperate with each Notice Holder to facilitate the timely preparation and delivery of
certificates representing Registrable Securities sold or to be sold pursuant to a Shelf
Registration Statement, which certificates shall not bear any restrictive legends, and cause such
Registrable Securities to be in such denominations as are permitted by the Indenture and registered
in such names as such Notice Holder may request in writing at least two (2) Business Days prior to
any sale of such Registrable Securities.

     (l) Provide a CUSIP number for all Registrable Securities covered by each Shelf Registration
Statement not later than the effective date of such Shelf Registration Statement and, if requested,
provide the Trustee and the transfer agent for the Common Stock with printed certificates for the
Registrable Securities that are in a form eligible for deposit with The Depository Trust Company.

     (m) Cooperate and assist in any filings required to be made with the National Association of
Securities Dealers, Inc.

     (n) In the case of a Shelf Registration Statement involving an underwritten offering, the
Company shall enter into such customary agreements (including, if requested, an underwriting
agreement in reasonably customary form) and take all such other action, if any, as Holders of a majority
of the Registrable Securities being sold or any managing underwriters reasonably shall request in
order to facilitate any disposition of Notes and Underlying Common Stock pursuant to such Shelf
Registration Statement, including, without limitation, (i) using its reasonable best efforts to
cause its counsel to deliver an opinion or opinions in reasonably customary form, (ii) using its
reasonable best efforts to cause its officers to execute and deliver all customary documents and
certificates and (iii) using its reasonable best efforts to cause its independent public
accountants to provide a comfort letter or letters in reasonably customary form.

11

 

     (o) Upon (i) the filing of the Initial Shelf Registration Statement and (ii) the effectiveness
of the Initial Shelf Registration Statement, announce the same, in each case by release to Reuters
Economic Services and Bloomberg Business News.

          SECTION 4. Holder’s Obligations. Each Holder agrees, by acquisition of the Registrable Securities, that no Holder shall be
entitled to sell any of such Registrable Securities pursuant to a Registration Statement or to
receive a Prospectus relating thereto unless such Holder has furnished the Company with a Notice
and Questionnaire as required pursuant to Section 2(d) hereof (including the information required
to be included in such Notice and Questionnaire) and the information set forth in the next
sentence. Each Notice Holder agrees promptly to furnish to the Company all information required to
be disclosed in order to make the information previously furnished to the Company by such Notice
Holder not misleading and any other information regarding such Notice Holder and the distribution
of such Registrable Securities as the Company may from time to time reasonably request. Any sale
of any Registrable Securities by any Holder shall constitute a representation and warranty by such
Holder that the information relating to such Holder and its plan of distribution is as set forth in
the Prospectus delivered by such Holder in connection with such disposition, that such Prospectus
does not as of the time of such sale contain any untrue statement of a material fact relating to or
provided by such Holder or its plan of distribution and that such Prospectus does not as of the
time of such sale omit to state any material fact relating to or provided by such Holder or its
plan of distribution necessary to make the statements in such Prospectus, in the light of the
circumstances under which they were made, not misleading. Each Holder further agrees, by acquiring
Registrable Securities, that it will not take any action that would result in the Company being
required to file with the SEC under Rule 433(d) a free writing prospectus (as defined in Rule 405
under the Securities Act) prepared by or on behalf of such Holder that otherwise would not be
required to be filed by the Company thereunder but for the action of such Holder.

12

 

          SECTION 5. Registration Expenses. The Company shall bear all fees and expenses incurred in connection with the performance by
the Company of its obligations under Sections 2 and 3 of this Agreement whether or not any Shelf
Registration Statement becomes or is declared effective. Such fees and expenses shall include,
without limitation, (i) all registration and filing fees (including, without limitation, fees and
expenses (x) with respect to filings required to be made with the National Association of
Securities Dealers, Inc. and (y) of compliance with federal and state securities or Blue Sky laws
(including, without limitation, reasonable fees and disbursements of the Special Counsel, if any,
in connection with Blue Sky qualifications of the Registrable Securities under the laws of such
jurisdictions as Notice Holders of a majority of the Registrable Securities being sold pursuant to
a Shelf Registration Statement may designate)), (ii) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities in a form eligible for
deposit with The Depository Trust Company), (iii) duplication expenses relating to copies of any
Shelf Registration Statement or Prospectus delivered to any Holders hereunder, (iv) fees and
disbursements of counsel for the Company in connection with any Shelf Registration Statement, (v) reasonable fees and disbursements of the Trustee and its counsel
and of the registrar and transfer agent for the Common Stock and (vi) any Securities Act liability
insurance obtained by the Company in its sole discretion. In addition, the Company shall pay the
internal expenses of the Company (including, without limitation, all salaries and expenses of
officers and employees performing legal or accounting duties), the expense of any annual audit, the
fees and expenses incurred in connection with the listing by the Company of the Registrable
Securities on any securities exchange on which similar securities of the Company are then listed
and the fees and expenses of any person, including special experts, retained by the Company.
Notwithstanding the provisions of this Section 5, each seller of Registrable Securities shall pay
selling expenses, including any underwriting discount and commissions, all registration expenses to
the extent required by applicable law and, except as otherwise provided herein, fees and expenses
of counsel to such seller.

          SECTION
6. Indemnification and Contribution

     (a) Indemnification by the Company. Upon the registration of the Registrable Securities
pursuant to Section 2 hereof, the Company shall indemnify and hold harmless each Notice Holder and
each underwriter, selling agent or other securities professional, if any, which facilitates the
disposition of Registrable Securities, and each of their respective officers and directors and each
person who controls such Notice Holder, underwriter, selling agent or other securities professional
within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (each such
person being sometimes referred to as an “Indemnified Person”) against any losses, claims, damages
or liabilities, joint or several, to which such Indemnified Person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of
a material fact contained in any Shelf Registration Statement under which such Registrable
Securities are to be registered under the Securities Act, or any Prospectus contained therein or
furnished by the Company to any Indemnified Person, or any amendment or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not misleading, and the
Company hereby agrees to reimburse such Indemnified Person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any such action or claim
as such expenses are incurred; provided, however, that the Company shall not be liable to any such
Indemnified Person in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in such Shelf Registration Statement or Prospectus, or amendment or
supplement, in reliance upon and in conformity with written information furnished to the Company by
such Indemnified Person expressly for use therein.

     (b) Indemnification by the Notice Holders and any Agents and Underwriters. Each Notice Holder
agrees, as a consequence of the inclusion of any of such Notice Holder’s Registrable Securities in
such Shelf Registration Statement, and each underwriter, selling agent or other securities
professional, if

13

 

any, which facilitates the disposition of Registrable Securities shall agree, as a consequence of facilitating such disposition of Registrable Securities, severally and not jointly,
to (i) indemnify and hold harmless the Company, its directors, officers who sign any Shelf
Registration Statement and each person, if any, who controls the Company within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act, against any losses,
claims, damages or liabilities to which the Company or such other persons may become subject, under
the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in such Shelf Registration Statement or Prospectus, or any amendment
or supplement, or arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with
written information furnished to the Company by such Notice Holder, underwriter, selling agent or
other securities professional expressly for use therein, and (ii) reimburse the Company for any
legal or other expenses reasonably incurred by the Company in connection with investigating or
defending any such action or claim as such expenses are incurred.

     (c) Notices of Claims, Etc. Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against an indemnifying party under this Section 6, notify
such indemnifying party in writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to any indemnified
party otherwise than under the indemnification provisions of or contemplated by subsection (a) or
(b) above. In case any such action shall be brought against any indemnified party and it shall
notify an indemnifying party of the commencement thereof, such indemnifying party shall be entitled
to participate therein and, to the extent that it shall wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party (who shall not, except with the consent of the indemnified party, be counsel
to the indemnifying party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, such indemnifying party shall not be liable to
such indemnified party under this Section 6 for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying party shall, without
the written consent of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or claim in respect of
which indemnification or contribution may be sought hereunder (whether or not the indemnified party
is an actual or potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all liability arising
out of such action or claim and (ii) does not include a statement as to, or an admission of, fault,
culpability or a failure to act, by or on behalf of any indemnified party.

     (d) Contribution. If the indemnification provided for in this Section 6 is unavailable to or
insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of
any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in
such proportion as is appropriate to reflect the relative fault of the indemnifying party and the
indemnified party in connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations including, but not limited to, the timeliness of the notice given as
required by Section 6(c). The relative fault of such indemnifying party and indemnified party
shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material fact relates

14

 

to information supplied by such indemnifying party or by such indemnified party, and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such
statement or omission. The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 6(d) were determined by pro rata allocation (even if the
Notice Holders or any underwriters, selling agents or other securities professionals or all of them
were treated as one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in this Section 6(d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such indemnified party in connection with investigating or
defending any such action or claim. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The obligations of the Notice
Holders and any underwriters, selling agents or other securities professionals in this Section 6(d)
to contribute shall be several in proportion to the percentage of principal amount of Registrable
Securities registered or underwritten, as the case may be, by them and not joint.

     (e) Notwithstanding any other provision of this Section 6, in no event will any (i) Notice
Holder be required to undertake liability to any person under this Section 6 for any amounts in
excess of the dollar amount of the proceeds to be received by such Holder from the sale of such
Holder’s Registrable Securities (after deducting any fees, discounts and commissions applicable
thereto) pursuant to any Shelf Registration Statement under which such Registrable Securities are
to be registered under the Securities Act and (ii) underwriter, selling agent or other securities
professional be required to undertake liability to any person hereunder for any amounts in excess
of the discount, commission or other compensation payable to such underwriter, selling agent or
other securities professional with respect to the Registrable Securities underwritten by it and
distributed to the public.

     (f) The obligations of the Company under this Section 6 shall be in addition to any liability
which the Company may otherwise have to any Indemnified Person and the obligations of any
Indemnified Person under this Section 6 shall be in addition to any liability which such
Indemnified Person may otherwise have to the Company. The remedies provided in this Section 6 are
not exclusive and shall not limit any rights or remedies which may otherwise be available to an
indemnified party at law or in equity.

          SECTION 7. Information Requirements. The Company covenants that, if at any time before the end of the Effectiveness Period the
Company is not subject to the reporting requirements of the Exchange Act, it will cooperate with
any Holder and take such further reasonable action as any Holder may reasonably request in writing
(including, without limitation, making such reasonable representations as any such Holder may
reasonably request), all to the extent required from time to time to enable such Holder to sell
Registrable Securities without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 and Rule 144A under the Securities Act and customarily taken in
connection with sales pursuant to such exemptions. Upon the written request of any Holder, the
Company shall deliver to such Holder a written statement as to whether it has complied with such
filing requirements, unless such a statement has been included in the Company’s most recent report
filed pursuant to Section 13 or Section 15(d) of Exchange Act. Notwithstanding the foregoing,
nothing in this Section 7 shall be deemed to require the Company to register any of its securities
(other than the Common Stock) under any section of the Exchange Act.

          SECTION 8. Underwritten Registrations. The Holders of Registrable Securities covered by a Shelf Registration Statement who desire
to do so may sell such Registrable Securities to an underwriter in an underwritten offering for
reoffering to the public. If any of the Registrable Securities covered by any Shelf Registration
Statement are to be sold in an underwritten offering, the investment

15

 

banker or investment bankers and manager or managers that will administer the offering will be selected by the Holders of a
majority of such Registrable Securities included in such offering, subject to the consent of the
Company (which shall not be unreasonably withheld or delayed), and such Holders shall be
responsible for all underwriting commissions and discounts and any transfer taxes in connection
therewith. No person may participate in any underwritten registration hereunder unless such person
(i) agrees to sell such person’s Registrable Securities on the basis reasonably provided in any
underwriting arrangements approved by the persons entitled hereunder to approve such arrangements
and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements.

          SECTION 9. Miscellaneous.

     (a) No Conflicting Agreements. The Company is not, as of the date hereof, a party to, nor
shall it, on or after the date of this Agreement, enter into, any agreement with respect to its
securities that conflicts with the rights granted to the Holders in this Agreement. The Company
represents and warrants that the rights granted to the Holders hereunder do not in any way conflict
with the rights granted to the holders of the Company’s securities under any other agreements.

     (b) Amendments and Waivers. The provisions of this Agreement, including the provisions of
this sentence, may not be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may not be given, unless the Company has obtained the written consent of
Holders of a majority of Registrable Securities. Notwithstanding the foregoing, a waiver or
consent to depart from the provisions hereof with respect to a matter that relates exclusively to
the rights of Holders whose securities are being sold pursuant to a Registration Statement and that
does not directly or indirectly affect the rights of other Holders may be given by Holders of at
least a majority of the Registrable Securities being sold by such Holders pursuant to such
Registration Statement; provided that the provisions of this sentence may not be amended, modified
or supplemented except in accordance with the provisions of the immediately preceding sentence.
Notwithstanding the foregoing, this Agreement may be amended by written agreement signed by the
Company and the Initial Purchasers, without the consent of the Holders of Registrable Securities,
to cure any ambiguity or to correct or supplement any provision contained herein that may be
defective or inconsistent with any other provision contained herein, or to make such other
provisions in regard to matters or questions arising under this Agreement that shall not adversely
affect the interests of the Holders of Registrable Securities. Each Holder of Registrable
Securities outstanding at the time of any such amendment, modification, supplement, waiver or
consent or thereafter shall be bound by any such amendment, modification, supplement, waiver or
consent effected pursuant to this Section 9(b), whether or not any notice, writing or marking
indicating such amendment, modification, supplement, waiver or consent appears on the Registrable
Securities or is delivered to such Holder.

     (c) Notices. All notices and other communications provided for or permitted hereunder shall
be made in writing by hand delivery, by telecopier, by courier guaranteeing overnight delivery or
by first-class mail, return receipt requested, and shall be deemed given (i) when made, if made by
hand delivery, (ii) upon confirmation, if made by facsimile, (iii) one (1) Business Day after being
deposited with such courier, if made by overnight courier or (iv) on the date indicated on the
notice of receipt, if made by first-class mail, to the parties as follows:

     (i) if to a Holder, at the most current address given by such Holder to the Company in
a Notice and Questionnaire or any amendment thereto;

     (ii) if to the Company, to:

16

 

NII Holdings, Inc.

10700 Parkridge Boulevard, Suite 600

Reston, Virginia 20191

Attention: General Counsel

Fax: (703) 390-5191

with a copy to:

Williams Mullen

A Professional Corporation

1021 East Cary Street

Richmond, Virginia 23219

Attention: Robert E. Spicer, Jr., Esq.

Fax: (804) 783-6507

     (iii) if to the Initial Purchasers, to:

Deutsche Bank Securities Inc.

60 Wall Street

New York, New York 10005

Attention: Equity-Linked Capital Markets Group

Fax: (212) 797-9344

with a copy to:

Shearman & Sterling LLP

599 Lexington Avenue

New York, New York 10022

Attention: Andrew Schleider, Esq.

Fax: (212) 848-7179

or to such other address as such person may have furnished to the other persons identified in this
Section 9(c) in writing in accordance herewith.

     (d) Approval of Holders. Whenever the consent or approval of Holders of a specified
percentage of Registrable Securities is required hereunder, Registrable Securities held by the
Company or its affiliates (as such term is defined in Rule 405 under the Securities Act) (other
than the Initial Purchasers or subsequent Holders if such subsequent Holders are deemed to be such
affiliates solely by reason of their holdings of such Registrable Securities) shall not be counted
in determining whether such consent or approval was given by the Holders of such required
percentage.

     (e) Successors and Assigns. Any person who purchases any Registrable Securities from the
Initial Purchasers shall be deemed, for purposes of this Agreement, to be an assignee of the
Initial Purchasers. This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties and shall inure to the benefit of and be binding upon
each Holder of any Registrable Securities, provided that nothing herein shall be deemed to permit
any assignment, transfer or other disposition of Registrable Securities in violation of the terms
of the Indenture. If any transferee of any Holder shall acquire Registrable Securities, in any
manner, whether by operation of law or otherwise, such Registrable Securities shall be held subject
to all of the terms of this Agreement, and by taking and holding such Registrable Securities, such
person shall be conclusively deemed to have agreed to be bound

17

 

by and to perform all of the terms and provisions of this Agreement and such person shall be entitled to receive the benefits hereof.

     (f) Counterparts. This Agreement may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be deemed to be
original and all of which taken together shall constitute one and the same agreement.

     (g) Headings. The headings in this Agreement are for convenience of reference only and shall
not limit or otherwise affect the meaning hereof.

     (h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.

     (i) Severability. If any term, provision, covenant or restriction of this Agreement is held
to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants
and restrictions set forth herein shall remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby, and the parties hereto shall use their reasonable best
efforts to find and employ an alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or restriction, it being intended
that all of the rights and privileges of the parties shall be enforceable to the fullest extent
permitted by law.

     (j) Entire Agreement. This Agreement is intended by the parties as a final expression of
their agreement and is intended to be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter contained herein and the
registration rights granted by the Company with respect to the Registrable Securities. Except as
provided in the Purchase Agreement, the Indenture and the Notes, there are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to herein, with
respect to the registration rights granted by the Company with respect to the Registrable
Securities. This Agreement supersedes all prior agreements and undertakings among the parties with
respect to such registration rights. No party hereto shall have any rights, duties or obligations
other than those specifically set forth in this Agreement, the Indenture and the Notes.

     (k) Termination. This Agreement and the obligations of the parties hereunder shall terminate
upon the end of the Effectiveness Period, except for any liabilities or obligations under Section
4, 5 or 6 hereof and the obligations to make payments of and provide for liquidated damages under
Section 2(e) hereof to the extent such damages accrue prior to the end of the Effectiveness Period,
each of which shall remain in effect in accordance with its terms.

18

 

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written
above.

	 	 	 	 	 
	 	NII HOLDINGS, INC.

 	 
	 	By:  	/s/	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	Confirmed and accepted as

of the date first above written:

DEUTSCHE BANK SECURITIES INC.

BEAR, STEARNS & CO. INC.

GOLDMAN, SACHS & CO.

BY: DEUTSCHE BANK SECURITIES INC.

 	 	 
	By:  	/s/	 	 
	 	(Deutsche Bank Securities Inc.) 	 	 
	 
	By:  	/s/	 	 
	 	(Deutsche Bank Securities Inc.) 	 	 

 

 

	 	 	 	 	 

SCHEDULE I

Initial Purchasers

Deutsche Bank Securities Inc.

Bear, Stearns & Co. Inc.

Goldman, Sachs & Co.exv10w3

 

Exhibit
10.3

FORM OF

ASSET TRANSFER AGREEMENT

By and Between

NEWCO,

and

INTEL CORPORATION

Dated as of                                     , 200
          

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	INTEL ASSET TRANSFER AGREEMENT
	 	 	1	 
	 
	 	 	 	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	1.1 Definitions
	 	 	1	 
	 
	 	 	 	 
	1.2 Defined Terms Generally
	 	 	1	 
	 
	 	 	 	 
	ARTICLE II Transfer Of Assets
	 	 	2	 
	 
	 	 	 	 
	2.1 Intel Transferred Assets
	 	 	2	 
	 
	 	 	 	 
	2.2 Intel Excluded Assets
	 	 	3	 
	 
	 	 	 	 
	2.3 Intel Transferred Liabilities
	 	 	5	 
	 
	 	 	 	 
	2.4 Intel Excluded Liabilities
	 	 	6	 
	 
	 	 	 	 
	2.5 Assignment of Contracts and Rights
	 	 	7	 
	 
	 	 	 	 
	2.6 Consideration
	 	 	8	 
	 
	 	 	 	 
	2.7 Inventory Adjustment to Consideration
	 	 	9	 
	 
	 	 	 	 
	2.8 Intel Transferred Employee Purchase Price Adjustment
	 	 	10	 
	 
	 	 	 	 
	2.9 Capital Expenditures
	 	 	11	 
	 
	 	 	 	 
	2.10 Deliveries by Newco
	 	 	12	 
	 
	 	 	 	 
	2.11 Pre Closing Deliveries by Intel
	 	 	13	 
	 
	 	 	 	 
	2.12 Closing
	 	 	13	 
	 
	 	 	 	 
	2.13 Post Closing Registrations
	 	 	14	 
	 
	 	 	 	 
	ARTICLE III REPRESENTATIONS AND WARRANTIES OF INTEL
	 	 	14	 
	 
	 	 	 	 
	3.1 Existence and Good Standing
	 	 	15	 
	 
	 	 	 	 
	3.2 Authorization and Enforceability
	 	 	15	 
	 
	 	 	 	 
	3.3 Governmental Authorization
	 	 	15	 
	 
	 	 	 	 
	3.4 Non-Contravention
	 	 	15	 

 

 

	 	 	 	 	 
	 	 	Page	 
	3.5 Personal Property
	 	 	16	 
	 
	 	 	 	 
	3.6 Real Property
	 	 	16	 
	 
	 	 	 	 
	3.7 Litigation
	 	 	17	 
	 
	 	 	 	 
	3.8 Intel Transferred Contracts and Consents
	 	 	17	 
	 
	 	 	 	 
	3.9 Compliance with Applicable Laws
	 	 	17	 
	 
	 	 	 	 
	3.10 Tax Matters
	 	 	18	 
	 
	 	 	 	 
	3.11 Intellectual Property
	 	 	20	 
	 
	 	 	 	 
	3.12 Employee Matters
	 	 	21	 
	 
	 	 	 	 
	3.13 Financial Information
	 	 	22	 
	 
	 	 	 	 
	3.14 Absence of Certain Changes
	 	 	23	 
	 
	 	 	 	 
	3.15 Environmental Matters
	 	 	24	 
	 
	 	 	 	 
	3.16 Product Warranties
	 	 	24	 
	 
	 	 	 	 
	3.17 Transferred Assets
	 	 	25	 
	 
	 	 	 	 
	3.18 Customers
	 	 	25	 
	 
	 	 	 	 
	3.19 Insurance
	 	 	25	 
	 
	 	 	 	 
	3.20 Inventories
	 	 	25	 
	 
	 	 	 	 
	3.21 Advisory Fees
	 	 	25	 
	 
	 	 	 	 
	3.22 Representations Regarding Intel Transferred
Entities and Intel Transferred
Interests
	 	 	25	 
	 
	 	 	 	 
	3.23 Investment Representations
	 	 	27	 
	 
	 	 	 	 
	3.24 Disclaimer of Warranties
	 	 	27	 
	 
	 	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES OF NEWCO
	 	 	27	 
	 
	 	 	 	 
	4.1 Existence and Good Standing
	 	 	28	 
	 
	 	 	 	 
	4.2 Authorization and Enforceability
	 	 	28	 
	 
	 	 	 	 
	4.3 Non-Contravention
	 	 	28	 
	 
	 	 	 	 
	4.4 Capitalization
	 	 	28	 

 

 

	 	 	 	 	 
	 	 	Page	 
	4.5 Valid Issuance of Shares
	 	 	29	 
	 
	 	 	 	 
	4.6 Exempt Offering
	 	 	29	 
	 
	 	 	 	 
	4.7 Lack of Registration Rights and Voting Agreements
	 	 	30	 
	 
	 	 	 	 
	4.8 Reliance
	 	 	30	 
	 
	 	 	 	 
	ARTICLE V COVENANTS
	 	 	30	 
	 
	 	 	 	 
	5.1 Access to Information
	 	 	30	 
	 
	 	 	 	 
	5.2 Compliance with Terms of Governmental Approvals and Consents
	 	 	31	 
	 
	 	 	 	 
	5.3 Use of Marks
	 	 	31	 
	 
	 	 	 	 
	5.4 Cooperation in Third Party Litigation
	 	 	32	 
	 
	 	 	 	 
	5.5 Assignments
	 	 	32	 
	 
	 	 	 	 
	5.6 Reasonable Efforts
	 	 	32	 
	 
	 	 	 	 
	5.7 Allocation of Non-Tax Operating Expenses
	 	 	32	 
	 
	 	 	 	 
	5.8 Tax Matters
	 	 	33	 
	 
	 	 	 	 
	5.9 Accounts Receivable
	 	 	36	 
	 
	 	 	 	 
	5.10 Accounts Payable
	 	 	37	 
	 
	 	 	 	 
	5.11 Employees
	 	 	37	 
	 
	 	 	 	 
	5.12 Protection of Privacy
	 	 	39	 
	 
	 	 	 	 
	5.13 Export Compliance
	 	 	39	 
	 
	 	 	 	 
	5.14 Satisfaction of Intel Pre-Closing Product Obligations
	 	 	40	 
	 
	 	 	 	 
	5.15 Additional Intel Financial Statements
	 	 	40	 
	 
	 	 	 	 
	5.16 Settlement of Claims
	 	 	40	 
	 
	 	 	 	 
	5.17 Back-end Equipment
	 	 	40	 
	 
	 	 	 	 
	5.18 Master Agreement Covenants
	 	 	41	 
	 
	 	 	 	 
	5.19 Further Assurances
	 	 	41	 
	 
	 	 	 	 
	5.20 Outstanding Checks; Bank Accounts
	 	 	42	 

 

 

	 	 	 	 	 
	 	 	Page	 
	5.21 Release of Liens
	 	 	42	 
	 
	 	 	 	 
	ARTICLE VI INDEMNIFICATION
	 	 	42	 
	 
	 	 	 	 
	6.1 General Survival
	 	 	42	 
	 
	 	 	 	 
	6.2 Indemnification
	 	 	42	 
	 
	 	 	 	 
	6.3 Manner of Indemnification
	 	 	45	 
	 
	 	 	 	 
	6.4 Third-Party Claims
	 	 	45	 
	 
	 	 	 	 
	6.5 Exclusive Remedy and Waiver and Release of Certain Claims
	 	 	46	 
	 
	 	 	 	 
	6.6 Subrogation
	 	 	47	 
	 
	 	 	 	 
	6.7 Damages
	 	 	47	 
	 
	 	 	 	 
	6.8 Environmental Indemnification Procedures
	 	 	47	 
	 
	 	 	 	 
	ARTICLE VII MISCELLANEOUS
	 	 	49	 
	 
	 	 	 	 
	7.1 Notices
	 	 	49	 
	 
	 	 	 	 
	7.2 Amendments; Waivers
	 	 	51	 
	 
	 	 	 	 
	7.3 Expenses
	 	 	52	 
	 
	 	 	 	 
	7.4 Successors and Assigns
	 	 	52	 
	 
	 	 	 	 
	7.5 Governing Law
	 	 	52	 
	 
	 	 	 	 
	7.6 Counterparts; Effectiveness
	 	 	52	 
	 
	 	 	 	 
	7.7 Entire Agreement
	 	 	52	 
	 
	 	 	 	 
	7.8 Captions
	 	 	52	 
	 
	 	 	 	 
	7.9 Severability
	 	 	52	 
	 
	 	 	 	 
	7.10 Dispute Resolution
	 	 	53	 
	 
	 	 	 	 
	7.11 Submission to Jurisdiction; Waiver of Jury Trial
	 	 	55	 
	 
	 	 	 	 
	7.12 Third Party Beneficiaries
	 	 	55	 
	 
	 	 	 	 
	7.13 Specific Performance
	 	 	55	 
	 
	 	 	 	 
	7.14 No Presumption Against Drafting Party
	 	 	56	 

 

 

FORM OF

INTEL ASSET TRANSFER AGREEMENT1

     THIS INTEL ASSET TRANSFER AGREEMENT (the “Intel Asset Transfer Agreement” and, as
referred to herein, this “Agreement”), dated as of                      ___, 200___, is by and between
Intel Corporation, a Delaware corporation (“Intel”), and [NEWCO], a company with limited
liability organized under the laws of The Netherlands (“Newco”). Intel and Newco are
sometimes referred to herein as the “Parties” and each individually as a “Party.”

     A. Intel desires to transfer, and to cause certain of its Affiliates to transfer (Intel and
such Affiliates, collectively, the “Intel Transferors”) to Newco and its Affiliates, and
Newco desires to acquire, and to cause its Affiliates to acquire, from Intel and such Intel
Affiliates, the Intel Transferred Assets in consideration for the issuance by Newco of the Intel
Newco Shares, the payment by Newco of the Intel Cash Consideration, and the assumption by Newco or
its Affiliates of the Intel Transferred Liabilities, all on the terms and conditions set forth in
this Agreement.

     B. Intel, ST, FP and FP Holdco entered into that certain Master Agreement, dated May 22, 2007,
that provides, among other things, for the simultaneous consummation of the transactions
contemplated by this Agreement, the ST Asset Contribution Agreement and the Share Purchase
Agreement, subject to the terms and conditions set forth in such agreements and the Master
Agreement.

     C. The Parties intend that, for United States federal income tax purposes, the transfer of the
Intel Transferred Assets and issuance of the Intel Consideration, as contemplated by this
Agreement, be treated as described on Schedule 2.6 to the Intel ATA Disclosure Letter.

     NOW, THEREFORE, in consideration of the foregoing and the mutual agreements contained herein,
the Parties hereby agree as follows:

ARTICLE I

DEFINITIONS

     1.1 Definitions. Capitalized terms used in this Agreement shall have the respective
meanings ascribed to such terms in Appendix A to this Agreement.

     1.2 Defined Terms Generally. The definitions set forth or referred to in Appendix
A shall apply equally to both the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and
“including” shall be deemed to be followed

 

			
	1	 	Intel Transferors and Newco Affiliates to be added
as Parties.

 

 

by the phrase “without limitation”. All references
herein to Articles, Sections and Exhibits and Schedules shall be deemed to be references to
Articles and Sections of, and Exhibits and Schedules to, this Agreement unless the context shall
otherwise require. Unless the context shall otherwise require, any reference to any contract,
instrument, statute, rule or regulation is a reference to it as amended and supplemented from time
to time (and, in the case of a statute, rule or regulation, to any successor provision). Any
reference in this Agreement to a “day” or a number of “days” (without the explicit qualification of
“Business”) shall be interpreted as a reference to a calendar day or number of calendar days.

ARTICLE II

TRANSFER OF ASSETS

     2.1 Intel Transferred Assets. Upon the terms and subject to the conditions of this
Agreement, at the Closing, Newco (or, to the extent indicated on Schedule 2.6 of the Intel
ATA Disclosure Letter, an Affiliate of Newco) shall acquire from the Intel Transferors, and Intel
shall transfer, assign and convey to Newco (or, to the extent indicated on Schedule 2.6 of
the Intel ATA Disclosure Letter, a Subsidiary of Newco), or cause to be transferred, assigned and
conveyed by the other Intel Transferors to Newco (or an Affiliate of Newco, in each case, as set
forth on Schedule 2.6 of the Intel ATA Disclosure Letter), free and clear of all Liens
other than Permitted Liens, all right, title and interest of the Intel Transferors in, to and under
the following assets, as the same shall exist at the Effective Time, after giving effect to any
changes therein pursuant to Sections 4.9 and 4.12 of the Master Agreement (subject
to the ultimate paragraph hereof with respect to assets transferred, assigned and conveyed to a
Intel Transferred Entity prior to the Closing) (collectively, the “Intel Transferred
Assets”):

     (a) the Intel Equipment;

     (b) the Intel Transferred Purchase Orders;

     (c) the Intel Transferred Sales Orders, including any rights that Intel or any
Subsidiary of Intel may have in any Post-Closing Accounts Receivable of Newco and its
Subsidiaries or the Intel Business (including those of the Intel Transferred Entities);

     (d) subject to Section 2.5, the Owned Intel Real Property, the Leased Intel
Real Property, and the Intel Leases, in each case as and to the extent contemplated by the
Intel Facility Transfer Term Sheets;

     (e) subject to Section 2.5, the Intel Transferred Contracts;

     (f) the Intel Prepayments;

     (g) the Intel Transferred Patents;

     (h) the Intel Transferred Trade Secrets;

     (i) the Intel Transferred Copyrights;

     (j) the Intel Transferred Trademarks;

2

 

     (k) the Intel Transferred Permits;

     (l) the Intel Books and Records;

     (m) the Intel Transferred Interests;

     (n) the Intel Transferred Inventory;

     (o) the Intel Transferred Claims;

     (p) the Intel Transferred Entity Books and Records;

     (q) the Intel Transferred Systems;

     (r) the licenses and other rights transferred by Intel to Newco pursuant to the Intel
Intellectual Property Agreement; and

     (s) any assets or properties listed in any new schedule to the Intel ATA Disclosure
Letter delivered to Newco pursuant to Section 4.12 of the Master Agreement;

     provided that in no event shall the Intel Transferred Assets include any Intel Excluded Asset.

     The Intel Transferred Intellectual Property shall be subject to any (i) licenses retained by
Intel or its Affiliates or granted to Intel or its Affiliates pursuant to any Intel Ancillary
Agreement, (ii) licenses and Contracts with use restrictions existing on the date hereof granted to
or by Intel or its Subsidiaries and (iii) licenses and Contracts with use restrictions entered into
by Intel or its Subsidiaries in the ordinary course of business not in violation of this Agreement
prior to the Closing Date. The Intel Transferred Intellectual Property may be further obligated
(either prior to the date of the Master Agreement or in the ordinary course of business between
such date and the Closing Date) to be non-exclusively licensed as a result of Intel’s or its
Affiliate’s participation in various Special Interest Groups (SIGs), Standard Definition
Organizations (SDOs), and similar organizations which may impose obligations to non-exclusively
license Intel Transferred Intellectual Property to third parties. To the extent that Intel is
required to ensure that successors with respect to the Intel Transferred Patents assume such
obligations to license, Newco hereby assumes such obligations.

     Notwithstanding the foregoing, with respect to any Intel Transferred Asset owned by a Intel
Transferred Entity at the Effective Time, in lieu of transferring such Intel Transferred Asset,
Intel shall transfer, assign and convey, or cause another Intel Transferor to transfer, assign and
convey, free and clear of all Liens other than Permitted Liens, all of the outstanding equity
interests of such Intel Transferred Entity, which interests shall be included in the Intel
Transferred Interests.

     2.2 Intel Excluded Assets. Newco and Intel expressly understand and agree that all
assets of Intel and its Subsidiaries other than the
Intel Transferred Assets (collectively, the “Intel Excluded Assets”), shall be
excluded from the Intel Transferred Assets, including, but not limited to:

3

 

     (a) all assets, tangible or intangible, real or personal, that are not specifically
identified under Section 2.1, including all of Intel’s Intellectual Property other
than the Intel Transferred Intellectual Property;

     (b) all Contracts that are not Intel Transferred Contracts;

     (c) all Prepayments of Intel associated with Contracts that are not Intel Transferred
Contracts or other obligations not assumed by Newco;

     (d) all Pre-Closing Accounts Receivable of Intel and its Subsidiaries;

     (e) all Cash and Cash Equivalents of Intel and its Subsidiaries;

     (f) all bank accounts of Intel and its Subsidiaries, other than bank accounts of the
Intel Transferred Entities;

     (g) all Intel Employee Plans;

     (h) all Intel Excluded Claims;

     (i) all rights to or claims for refunds or credits of Taxes (including penalties) paid
by Intel or any of its Subsidiaries, or any member of any consolidated, affiliated, combined
or unitary group of which Intel is or has been a member, other than refunds of Taxes with
respect to a Post-Closing Tax Period paid by the Intel Transferred Entities or Newco or any
of its Subsidiaries;

     (j) all rights, properties, and assets which have been used in the Intel Business and
which shall have been transferred (including transfers by way of sale), licensed or
otherwise disposed of in the ordinary course of business (other than to Intel or any
Subsidiary of Intel) prior to the Effective Time and not in violation of the terms of this
Agreement or Section 4.9 of the Master Agreement;

     (k) except as expressly provided in Section 2.1(q), all enterprise software,
database management systems and networks of Intel or its Subsidiaries, including all sales
management, engineering, materials, business planning, manufacturing, logistics, finance and
accounting systems utilized by the Intel Business;

     (l) the minute books, stock ledgers, accounting records, Tax Returns and others records
relating to Taxes, in each case of Intel or any of its Subsidiaries (other than the Intel
Transferred Entities), other than the Intel Books and Records;

     (m) internal reports relating to the business activities of Intel and its Subsidiaries
that are not Intel Transferred Assets;

     (n) insurance policies and rights, claims or causes of action thereunder, including
Claims which Intel or any of its Affiliates may have under any insurance contracts or
policies insuring the Intel Transferred Assets;

4

 

     (o) all of the assets specifically identified on Schedule 2.2(o) of the Intel
ATA Disclosure Letter; and

     (p) any asset of the Intel Transferred Entities that is not a Intel Transferred Asset.

     On the Closing Date, immediately prior to the Closing, each Intel Transferred Entity holding
Intel Excluded Assets shall transfer, assign and convey all of its right, title and interest in and
to such Intel Excluded Assets, including any and all intercompany Accounts Receivable of such Intel
Transferred Entity, to Intel or a Subsidiary of Intel designated by Intel, such that no Intel
Transferred Entity shall hold any Intel Excluded Asset as of the Closing Date.

     2.3 Intel Transferred Liabilities. Upon the terms and subject to the conditions of
this Agreement and the Intel Ancillary Agreements, effective at the Effective Time, Newco (or, to
the extent indicated on Schedule 2.6 of the Intel ATA Disclosure Letter, a Subsidiary of
Newco) shall assume, and shall fully pay, perform, fulfill and discharge when due, the following
Liabilities of Intel or its Subsidiaries, it being understood that certain of the Liabilities set
forth below may be a Liability of a Intel Transferred Entity, the interests in which are
transferred to Newco (or a Subsidiary of Newco as indicated on Schedule 2.6 to the Intel
ATA Disclosure Letter) (collectively, the “Intel Transferred Liabilities”):

     (a) all Liabilities under or arising out of the Intel Transferred Contracts that are
required to be paid or performed on and after the Effective Time;

     (b) all Liabilities that are expressly assumed under this Agreement;

     (c) all Liabilities to the extent accruing, arising out of, or relating to the
operation and ownership of the Intel Business and the Intel Transferred Assets by Newco and
its Subsidiaries on and after the Effective Time;

     (d) all Liabilities (including any Intel Employee Agreements) that are assumed by
operation of Applicable Law related to the Intel Transferred Employees;

     (e) any Taxes (x) of a Intel Transferred Entity, or arising from the Intel Transferred
Assets or Intel Business, in either case allocable to a Post-Closing Tax Period, except to
the extent otherwise allocated to Intel pursuant to Section 5.8 or as described in
clauses (i) and (ii) of Section 6.2(g) and (y) otherwise allocated to Newco,
pursuant to Section 5.8;

     (f) the Intel Post-Closing Product Obligations; and

     (g) all Intel Post-Closing Environmental Liabilities;

     provided that in no event shall the Intel Transferred Liabilities include any Intel Excluded
Liability.

     Notwithstanding the foregoing, with respect to any Intel Transferred Liability owed by a Intel
Transferred Entity at the Effective Time, in lieu of the assumption by Newco of such Intel

5

 

Transferred Liability from such Intel Transferred Entity, such Intel Transferred Liability shall be
retained at the Effective Time by such Intel Transferred Entity, and Newco shall, or shall cause
such Intel Transferred Entity, or successor thereto, to pay or otherwise satisfy and discharge such
Intel Transferred Liability on a timely basis after the Effective Time.

     2.4 Intel Excluded Liabilities. Except for those Liabilities expressly assumed by
Newco pursuant to Section 2.3 and Section 5.8, Newco shall not assume and shall not
be liable for, and Intel shall retain and remain, as between Intel and Newco, solely liable for and
obligated to discharge, all of the debts, expenses, contracts, agreements, commitments, obligations
and other Liabilities of any nature of Intel or any of its Subsidiaries (collectively, the
“Intel Excluded Liabilities”), including the following:

     (a) any Liability for breaches by Intel or its Subsidiaries prior to the Effective Time
of any Contract or any Liability for payments or amounts due under any Contract prior to the
Effective Time;

     (b) any Liability for Taxes attributable to or imposed upon Intel or any of its
Subsidiaries, or attributable to or imposed upon the Intel Business, the Intel Transferred
Entities or the Intel Transferred Assets for any Pre-Closing Tax Period other than any
Liability for Taxes allocated to Newco pursuant to Section 5.8 and any Liability for
Taxes otherwise allocated to Intel pursuant to Section 5.8;

     (c) all Pre-Closing Accounts Payable of Intel and its Subsidiaries;

     (d) any and all Liabilities under Intel Employee Plans and Intel Employee Agreements,
including any Liabilities arising in connection with any change-in-control or similar
compensatory payment arrangement which is triggered in whole or in part by the transactions
contemplated by this Agreement and the other Transaction Documents, including any retention
bonus, stay bonus or similar payment (other than the Intel Transferred Employee Payment
Liabilities, the Intel Funded Employee Plan Amounts, or those Liabilities assumed by Newco
pursuant to Section 5.11(c));

     (e) any Liabilities or obligations with respect to the Intel Business Employees
including the Intel Transferred Employees that arise prior to the Effective Time (or, with
respect to each Intel Transferred Employee, such other date on which the Intel Transferred
Employee ceases to be employed by Intel, if later) (other than the Intel Transferred
Employee Payment Liabilities, the Intel Funded Employee Plan Amounts, or those Liabilities
assumed by Newco pursuant to Section 5.11(c));

     (f) any Liabilities or obligations with respect to any Intel Business Employees who do
not become Intel Transferred Employees and any Liabilities of the Intel
Transferred Entities with respect to any employee who does not become a Intel
Transferred Employee;

     (g) any Liability for or in respect of any Indebtedness, other than the Contemplated
Financing;

     (h) any Liability to the extent arising out of the Intel Excluded Assets;

6

 

     (i) the Intel Pre-Closing Product Obligations;

     (j) any Liability of the Intel Transferred Entities that is not a Intel Transferred
Liability;

     (k) any Intel Pre-Closing Environmental Liabilities; and

     (l) any Liability of Intel or any of its Subsidiaries that is the subject of any
existing Proceedings as of the Closing Date, including the Proceedings set forth in
Schedule 3.7 and the claims against Intel or its Subsidiaries set forth in
Schedule 3.11 to the Intel ATA Disclosure Letter, in each case, to the extent
arising or accruing prior to the Effective Time, but in any event not including any
Liability to the extent arising or accruing after the Effective Time.

     On the Closing Date, immediately prior to the Closing, Intel, or a Subsidiary of Intel
designated by Intel and reasonably acceptable to Newco shall assume, and shall thereafter pay,
perform, fulfill and discharge when due any Intel Excluded Liability of each Intel Transferred
Entity, including any and all Indebtedness of, and intercompany Accounts Payable to, Intel and its
Subsidiaries, pursuant to an assumption of liability agreement in a form to be mutually agreed
between Intel and Newco (“Intel Assumption of Excluded Liabilities”).

     2.5 Assignment of Contracts and Rights.

     (a) Anything in this Agreement or any other Transaction Document to the contrary
notwithstanding, this Agreement shall not constitute an agreement to assign any Intel
Transferred Contract, Intel Transferred Permit, or other Intel Transferred Asset, or any
claim, right or benefit arising thereunder or resulting therefrom if an attempted assignment
thereof, without the consent of a party thereto or the receipt of any Governmental Approvals
or the satisfaction of any other requirement applicable to such assignment, would constitute
a breach or other contravention thereof or in any way result in the loss of any material
benefit under, or any material modification to, the rights of Newco, Intel or any of Intel’s
Subsidiaries thereunder. Intel and Newco will use commercially reasonable efforts (but
without any payment of money by Intel) to obtain the consent of the other parties to any
such Intel Transferred Contract, Intel Transferred Permit or other Intel Transferred Asset
or any claim, right or benefit arising thereunder for the assignment thereof to Newco as
Newco may reasonably request; provided, however, that except as provided in Section
2.5 of the Intel Intellectual Property Agreement with respect to the sublicensing of
certain Third Party Claims to Newco, Intel shall have no obligation to transfer or assign
any license of any Intellectual Property other
than the Intel Transferred Intellectual Property or any licenses granted by Intel in
connection with the sale, distribution and license of the Intel Products in the ordinary
course of business that are not Intel Transferred Contracts. Subject to the obligations of
Intel set forth in Section 5.6, Section 4.3 of the Master Agreement,
Section 2.6 of the Intel Intellectual Property Agreement, the Intel Transition
Services Agreement and the Intel Supply Agreement, Newco agrees that Intel shall not have
any liability to Newco arising out of or relating to the failure to obtain any such consent
or to satisfy any other such requirement that may be required in connection with the
transactions contemplated

7

 

by this Agreement or the Intel Ancillary Agreements or because of
any circumstances resulting from any such failure; provided, however, that nothing in this
Section 2.5(a) is intended to affect Intel’s representation in Section
3.8(b) regarding Intel Contractual Consents.

     (b) If any such consent is not obtained, or any such other requirement is not
satisfied, prior to the Closing and as a result thereof Newco shall be prevented by such
third party from receiving the rights and benefits with respect to such Intel Transferred
Contract, Intel Transferred Permit or other Intel Transferred Asset intended to be
transferred hereunder, or if any attempted assignment would adversely affect the rights of
Intel or any of its Subsidiaries thereunder so that Newco would not in fact receive all such
rights or Intel or any of its Subsidiaries would forfeit or otherwise lose the benefit of
rights that Intel or any such Subsidiary is entitled to retain, Intel and Newco shall
cooperate to discuss, determine and implement in good faith a mutually agreeable reasonable
arrangement to the extent practicable, under which (i) Newco would obtain the economic
claims, rights and benefits under such asset and assume the economic burdens and obligations
with respect thereto in accordance with this Agreement, including potentially by
subcontracting, sublicensing or subleasing to Newco (but not more extensive than the
existing rights of Intel and its Subsidiaries with respect to the Intel Business), or (ii)
Intel would enforce for the benefit of Newco, with Newco assuming Intel’s obligations, any
and all rights of Intel and its Subsidiaries against a third party thereto; provided, that
Newco shall reimburse Intel for all reasonable out-of-pocket expenses that are imposed on
Intel and any of its Subsidiaries in bearing such economic burdens and obligations that
otherwise would have been borne by Newco if the applicable asset had been transferred to
Newco at the Effective Time. Newco agrees that neither Intel nor any of its Subsidiaries
shall have any liability to Newco arising out of or relating to the failure to obtain any
such consent, and no condition set forth in the Master Agreement, other than the conditions
set forth in Section 5.1(f) and Section 5.2(f) shall be deemed not
satisfied, as a result of (x) the failure to obtain any such consent or any circumstances
resulting therefrom or (y) any suit, action or proceeding commenced or threatened by or on
behalf of any Person arising out of or relating to the failure to obtain any such consent or
any circumstances resulting therefrom; provided, however, that nothing in this Section
2.5(b) is intended to affect Intel’s representation in Section 3.8(b) regarding
Intel Contractual Consents.

     (c) No other rights are granted hereunder, by implication, estoppel, statute or
otherwise, except as expressly provided in this Agreement or in any other Transaction
Document.

     2.6 Consideration. The consideration payable at the Closing by Newco and its
Affiliates to Intel and the other Intel Transferors for the Intel Transferred Assets shall consist
of:

     (a) [45.10% of the Shares] Ordinary Shares of Newco (the “Intel Newco Shares”),
reduced by the number of Ordinary Shares purchased by Intel or its Affiliates pursuant to
the Intel Option (the “Intel Option Shares”);

8

 

     (b) cash in the amount of $432,000,000, increased by the amount, if any, of the
consideration paid by Intel or its Affiliates for Ordinary Shares pursuant to the Intel
Option (the “Intel Cash Consideration”); and

     (c) the assumption by Newco and certain of its Subsidiaries of the Intel Transferred
Liabilities being assumed by Newco (together with the Intel Newco Shares, the Intel Option
and the Intel Cash Consideration, the “Intel Consideration”).

Such consideration shall be allocated among Intel and the other Intel Transferors as
described in Schedule 2.6 of the Intel ATA Disclosure Letter (as such allocation
shall be determined pursuant to Section 4.13 of the Master Agreement and attached
hereto at the Closing), and shall be treated as having been paid by Newco on behalf of
certain of its Subsidiaries also as provided in Schedule 2.6 of the Intel ATA
Disclosure Letter, which Schedule 2.6 shall be prepared in a manner consistent with
the Third Party Appraisal. Each of the Parties hereto agrees to report the transactions
contemplated hereby for U.S. federal, state and foreign Tax purposes in accordance with such
allocation of the Intel Consideration and as set forth on such schedule. Intel shall
prepare Schedule 2.6 of the Intel ATA Disclosure Letter subject to Newco’s approval,
which approval shall not be unreasonably withheld. Such schedule shall be adjusted for any
changes to the Intel Cash Consideration, in a manner consistent with the Third Party
Appraisal and otherwise as Intel determines in its reasonable discretion.

     2.7 Inventory Adjustment to Consideration. The Intel Cash Consideration shall be
subject to adjustment after the Closing Date in accordance with the following procedure:

     (a) Promptly after the Closing Date, Intel will prepare and present to Newco a
statement in reasonable detail of the Intel Inventory Value as of the end of Intel’s first
fiscal quarter of 2007 and as of the Effective Time (the “Preliminary Intel Inventory
Statement”). The Preliminary Intel Inventory Statement shall be delivered to Newco no
later than 90 days after the Closing Date.

     (b) Newco and its accountants shall have the right to review the work papers of Intel
and its accountants utilized in preparing the Preliminary Intel Inventory Statement and
shall have full access to the books, records, properties and personnel of Intel for purposes
of verifying the accuracy and fairness of the presentation of the Intel Inventory Value in
the Preliminary Intel Inventory Statement. The Preliminary Intel Inventory Statement shall
be binding on Newco, unless Newco presents to Intel written notice of disagreement with the
Preliminary Intel Inventory Statement (“Intel Notice of 
Disagreement”) within 120 days after the Closing Date specifying in reasonable
detail the nature and extent of the disagreement.

     (c) During the 30-day period following the delivery of a Intel Notice of Disagreement,
Intel and Newco shall seek in good faith to resolve in writing any differences which they
may have with respect to any amount specified in the Intel Notice of Disagreement. If Newco
and Intel are unable to resolve any such disagreement within 30 days after Intel receives
the Newco Notice of Disagreement, the disagreement shall be referred for final determination
to Deloitte & Touche USA LLP or if Deloitte & Touche

9

 

USA LLP is unable or unwilling to make
such final determination, to such other independent accounting firm as the parties shall
mutually designate. The accounting firm so designated to make the final determination is
hereinafter referred to as the “Independent Accountants.”

     (d) Intel Inventory Value as of the end of Intel’s first fiscal quarter of 2007 and as
of the Effective Time shall be deemed to have been finally determined upon the first to
occur of (i) acceptance of the Preliminary Intel Inventory Statement, (ii) Newco’s failure
to object thereto within 150 days after the Closing Date, (iii) resolution by mutual
agreement of the parties after timely delivery of the Newco Notice of Disagreement or (iv)
notification by the Independent Accountants of their final determination thereof.

     (e) If the Intel Inventory Value as of the Effective Time, as finally determined, is
less than the Minimum Committed Intel Inventory Value, the Intel Cash Consideration shall be
deemed reduced by such difference. Intel shall cause the amount of any such reduction in
the Intel Cash Consideration to be refunded to Newco by the Intel Transferor responsible for
such reduction, as determined by Intel, within 10 days after such final determination. If
the Intel Inventory Value as of the Effective Time, as finally determined, is equal to or
greater than the Minimum Committed Intel Inventory Value, there shall be no adjustment in
the Intel Cash Consideration.

     (f) The fees and disbursements of the accountants of Newco shall be paid by Newco. The
fees and disbursements of Intel’s accountants shall be paid by Intel. The fees and
disbursements of the Independent Accountants shall be paid based on a ratable allocation
made as a part of its determination, based on the proportion by which the amount in dispute
was determined in favor of Newco or Intel.

     2.8 Intel Transferred Employee Purchase Price Adjustment. The Intel Cash
Consideration shall be subject to adjustment after the Closing Date in accordance with the
following procedure:

     (a) Promptly after the Closing Date, Intel shall prepare a statement (the
“Intel Preliminary Closing Statement”) setting forth the Intel Transferred
Employee Payment Liabilities as of the Effective Time, and containing reasonably detailed
supporting information, documents and calculations. Intel shall use commercially reasonable
efforts to cause such preparation and review to be completed and the Preliminary Closing
Statement to be delivered to Newco within 150 days after the Closing Date. The Preliminary
Closing Statement shall be prepared by Intel from the books and records of
Intel consistent with past practice and the Intel Financial Information and in
accordance with GAAP.

     (b) Newco and its accountants shall have the right to review the work papers of Intel
and its accountants utilized in preparing the Intel Preliminary Closing Statement and shall
have full access to the books, records, properties and personnel of Intel and its
Subsidiaries for purposes of verifying the accuracy and fairness of the presentation of the
information in the Intel Preliminary Closing Statement. The Intel Preliminary Closing
Statement shall be binding on Newco, unless Newco delivers to Intel written notice of

10

 

disagreement with any Intel Transferred Employee Payment Liabilities set forth therein
(“Notice of Disagreement”) within 150 days the Closing Date specifying in reasonable
detail the nature and extent of the disagreement, in which case the Intel Preliminary
Closing Statement shall be binding on Newco only in respect of the Intel Transferred
Employee Payment Liabilities set forth therein which are not the subject of a Notice of
Disagreement.

     (c) During the 30-day period following the delivery of a Notice of Disagreement, Intel
and Newco shall seek in good faith to resolve in writing any differences which they may have
with respect to any Intel Transferred Employee Payment Liabilities specified in the Notice
of Disagreement. If Newco and Intel are unable to resolve any such disagreement within 30
days after Intel receives a Notice of Disagreement, the disagreement shall be referred for
final determination to Deloitte & Touche USA LLP or if Deloitte & Touche USA LLP is unable
or unwilling to make such final determination, to such other independent accounting firm as
the parties shall mutually designate. The accounting firm so designated to make the final
determination is hereinafter referred to in this Section 2.8 as the “Intel Cash
Independent Accountants.”

     (d) The Intel Transferred Employee Payment Liabilities shall be deemed to have been
finally determined upon the first to occur of (i) Newco’s failure to deliver to Intel a
Notice of Disagreement with respect to such Intel Transferred Employee Payment Liabilities
150 days after the Closing Date, (ii) resolution by mutual agreement of the parties after
timely delivery of a Notice of Disagreement or (iii) notification by the Intel Cash
Independent Accountants of their final determination thereof. Within ten days after the
date on which all of the Intel Transferred Employee Payment Liabilities (as they may be
revised pursuant to this Section 2.8) shall have become final and binding (the
“Final Payment Date”), Intel shall pay Newco an amount equal to the Intel
Transferred Employee Payment Liabilities.

     2.9 Capital Expenditures.

     (a) Within 90 days after the Closing Date, Intel shall deliver to Newco a schedule
setting forth in reasonable detail the amount of all capital expenditures made by Intel in
accordance with the Intel Business Capital Expenditures Plan between April 1, 2007 and the
Closing Date (“Actual Intel Capital Expenditures”). For purposes hereof,
“Planned Intel Capital Expenditures” means (i) the planned amount of capital
expenditures set forth in the Intel Business Capital Expenditures Plan for each fiscal
quarter completed during the period from April 1, 2007 through the end of the last full
fiscal quarter ending prior to the Closing Date plus (ii) a prorated amount equal to
the planned amount of capital expenditures set forth in the Intel Business Capital
Expenditures Plan for the fiscal quarter in which the Closing Date occurs multiplied by a
fraction the numerator of which is the number of days elapsed in such fiscal quarter through
the Closing Date and the denominator of which is the total number of days in such fiscal
quarter. In the event that the Closing shall not have occurred on or before the expiration
of the then current Intel Business Capital Expenditures Plan, the Parties will agree in good
faith on the modification of such Intel Business Capital Expenditures Plan to add additional
planned amounts of capital expenditures for the following fiscal quarter

11

 

or quarters. Newco
shall have full access to the Intel Books and Records, for purposes of verifying the
accuracy and fairness of the schedule of Actual Intel Capital Expenditures delivered by
Intel to Newco hereunder.

     (b) The schedule of Actual Intel Capital Expenditures shall be binding on Newco, unless
Newco presents to Intel written notice of disagreement with the schedule of Actual Intel
Capital Expenditures (“Intel Cap Ex Notice of Disagreement”) within 150 days after
the Closing Date specifying in reasonable detail the nature and extent of the disagreement.

     (c) During the 30-day period following the delivery of a Intel Cap Ex Notice of
Disagreement, Intel and Newco shall seek in good faith to resolve in writing any differences
which they may have with respect to any amount specified in the Intel Cap Ex Notice of
Disagreement. If Newco and Intel are unable to resolve any such disagreement within 30 days
after Intel receives the Intel Cap Ex Notice of Disagreement, the disagreement shall be
referred for final determination to Deloitte & Touche USA LLP or if Deloitte & Touche USA
LLP is unable or unwilling to make such final determination, to such other independent
accounting firm as the parties shall mutually designate. The accounting firm so designated
to make the final determination is hereinafter referred to as the “Cap Ex Independent
Accountants.”

     (d) Actual Intel Capital Expenditures as of the Effective Time shall be deemed to have
been finally determined upon the first to occur of (i) acceptance of the schedule of Actual
Intel Capital Expenditures, (ii) Newco’s failure to object thereto within 150 days after the
Closing Date, (iii) resolution by mutual agreement of the parties after timely delivery of
the Intel Cap Ex Notice of Disagreement or (iv) notification by the Cap Ex Independent
Accountants of their final determination thereof.

     (e) In the event the Actual Intel Capital Expenditures are less than the Planned Intel
Capital Expenditures for the period from April 1, 2007 through the Closing Date, Intel shall
pay to Newco within 10 days after the final determination the amount of the difference.

     (f) The fees and disbursements of the accountants of Newco shall be paid by Newco. The
fees and disbursements of Intel’s accountants shall be paid by Intel. The fees and
disbursements of the Cap Ex Independent Accountants shall be paid based on a ratable
allocation made as a part of its determination, based on the proportion by which the amount
in dispute was determined in favor of Newco or Intel.

     2.10 Deliveries by Newco. Newco shall, on or before the Closing, execute and deliver
or cause to be delivered to the civil law notary (“civil law notary”), who shall execute and
deliver the notarial deed of issue in respect of the Intel Newco Shares (with a copy to Intel):

12

 

     (a) a certificate issued by a registered accountant as referred to in Section 2:204b
Dutch Civil Code relating to the value of the Intel Transferred Assets to be contributed to
Newco against the issuance of the Intel Newco
Shares;2

     (b) a true and complete copy of the resolutions duly and validly adopted by the
Managing Director and the shareholders of Newco evidencing their authorization of the
execution and delivery of this Agreement and the consummation of the transactions
contemplated hereby including the issuance of the Intel Newco Shares;

     (c) a duly executed power of attorney by Newco with respect to the execution of the
notarial deed of issue of shares in respect of the Intel Newco Shares; and

     (d) a certificate of the Managing Director certifying the names and signatures of the
Persons authorized to sign this Agreement and the other documents to be delivered hereunder.

     2.11 Deliveries by Intel. Prior to the Closing, Intel shall deliver to the civil law
notary executing the deed of issue in respect of the Intel Newco Shares, a duly executed power of
attorney by Intel with respect to the execution of the notarial deed of issue in respect of the
Intel Newco Shares, which power of attorney shall be legalized and affixed with an apostille and
shall be accompanied by a legal opinion certifying that the signatory or signatories of the power
has or have the authority to represent Intel with respect to the matters to which the power
pertains.3

     2.12 Closing. At the Closing:

     (a) The Intel Transferors shall deliver to Newco and its Affiliates the Intel Bills of
Sale and, Intel, through its officers, agents and employees, will, except as set forth on
Schedule 2.12(a), put Newco and its Affiliates, as applicable, in possession of all
tangible Intel Transferred Assets at the facilities where they are located as of the
Effective Time (other than such Intel Transferred Assets that are already owned by Intel
Transferred Entities);

     (b) Intel and Newco and their respective Affiliates, as applicable, each shall execute
and deliver each of the Intel Ancillary Agreements to which it is a party and shall make any
deliveries required thereunder;

 

			
	2	 	This provision assumes issuance of shares in
consideration of assets contributed only to Intel, and not Intel Affiliates.
If any Newco shares are issued to Affiliates, we will need similar certificates
with respect to assets contributed by each Affiliate.
	 
	3	 	If Newco shares will be issued to any Affiliates of
Intel, each such Affiliate will also need to deliver a POA.

13

 

     (c) on behalf of itself and its Affiliates, Newco shall pay to Intel for Intel’s
account and/or for the account of the applicable Intel Transferors the Intel Cash
Consideration by wire transfer of immediately available funds to a bank account designated
in writing by Intel prior to the Closing;

     (d) Newco shall instruct the civil law notary to execute the notarial deed of issue in
respect of the Intel Newco Shares and, upon the execution of such deed (i) register or cause
to be registered the issue of the Intel Newco Shares in the share register of Newco and (ii)
deliver a copy of the deed of issue in respect of the Intel Newco Shares and the
registration of such issuance in the share register of Newco to Intel or one of its
Affiliates;

     (e) Newco and Intel shall execute and deliver a delivery protocol relating to the
manner for delivery of any intangible property that is a Intel Transferred Asset;

     (f) Intel shall deliver, or cause to be delivered, all certificates or instruments
representing the Intel Transferred Interests duly endorsed and accompanied by necessary
documentation for transfer;

     (g) Intel shall furnish Newco with the following documents regarding the Intel
Transferred Entities:

     (i) the charter documents of each Intel Transferred Entity and all amendments
thereto, duly certified by the proper officials of the jurisdiction of organization
of each such Intel Transferred Entity;

     (ii) resignations, effective on the Closing Date, of the officers and directors
of each Intel Transferred Entity, unless otherwise specified by Newco prior to the
Closing Date; and

     (iii) the complete and correct corporate minute books and reports filed with
Governmental Authorities as required by Applicable Law (including registration of
stock transfers) of the Intel Transferred Entities.

     2.13 Post Closing Registrations. Within eight days after the Closing, Newco shall (a)
file with the Commercial Register the certificate issued by the registered accountant as referred
to in Section 2.10(a) above and (b) register with the Commercial Register the increase in
its capital.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF INTEL

     Subject to the exceptions that are disclosed in the Intel ATA Disclosure Letter, Intel hereby
makes the following representations and warranties to Newco. Such representations and
warranties are made to Newco as if made and effective (a) on May 22, 2007 (except that with
respect to any representation and warranty that specifies another date, such representation and
warranty shall be made as of such specified date) and (b) as of the date hereof (except that with

14

 

respect to any representation and warranty that specifies another date, such representation and
warranty shall be made as of such specified date), as follows:

     3.1 Existence and Good Standing. Each of the Intel Transferors is duly organized,
validly existing and in good standing under the laws of its jurisdiction of organization (to the
extent such concept is recognized in such jurisdiction) and has all requisite power and authority
required to carry on its business as now conducted and to own and operate the Intel Business as now
owned and operated by it. Each of the Intel Transferors is qualified to conduct business and is in
good standing in each jurisdiction in which it conducts the Intel Business (to the extent such
concept is recognized in such jurisdiction) other than such jurisdictions where the failure to be
so qualified would not reasonably be expected to have a Intel Material Adverse Effect.

     3.2 Authorization and Enforceability. Each of the Intel Transferors has all requisite
power and authority to execute and deliver each of the Transaction Documents to which it is or will
be a party, to perform its obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery by each Intel Transferor of each of
the Transaction Documents to which it is a party, and the performance by each Intel Transferor of
its obligations contemplated hereby and thereby, have been duly and validly authorized by all
necessary corporate action. The Transaction Documents have been duly and validly executed and
delivered by the Intel Transferor which is a party thereto and, assuming the due execution and
delivery of this Agreement and the other Transaction Documents to which it is a party by Newco (or
a Subsidiary of Newco) and the other parties thereto, this Agreement constitutes, and each of the
Transaction Documents to which a Intel Transferor is a party constitutes, the legal, valid and
binding agreement of such Intel Transferor, enforceable against such Intel Transferor in accordance
with their respective terms, except to the extent (a) that their enforceability may be subject to
any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws now or hereafter
in effect relating to creditors’ rights generally or to general principles of equity or (b)
indemnification provisions contained in the Shareholders’ Agreement may be limited by applicable
securities laws.

     3.3 Governmental Authorization. Other than the Intel Approvals and ST Approvals, the
execution, delivery and performance by each Intel Transferor of the Transaction Document(s) to
which it is a party, and the consummation by it of the transactions contemplated thereby, require
no Governmental Approval.

     3.4 Non-Contravention.

     (a) The execution, delivery and performance by the Intel Transferors of the Transaction
Documents to which it is a party, and the consummation of the transactions contemplated
thereby, do not and will not: (i) contravene or conflict with the certificate of
incorporation, bylaws, articles of association or other corporate organizational or
governing documents of any Intel Transferor or any Intel Transferred Entity; (ii)
assuming receipt of the Intel Approvals, contravene or conflict with or constitute a
material violation of any provision of any Applicable Law binding upon or applicable to any
Intel Transferor, the Intel Transferred Assets or the Intel Transferred Entities; or (iii)
assuming receipt of the Intel Approvals, the Newco Approvals and of the Intel Contractual
Consents, (A) constitute a default under, give rise to any right of termination,

15

 

cancellation, modification, acceleration of, or a loss of any benefit under any Intel
Contract, including the Intel Transferred Contracts or (B) result in the creation or
imposition of any Lien (other than Permitted Liens) on any Intel Transferred Asset, or (C)
constitute a breach, default or violation of any settlement agreement, judgment, injunction
or decree, except in the case of clause (ii) or (iii), for matters that would not reasonably
be expected to have a Intel Material Adverse Effect (provided that in determining whether a
Intel Material Adverse Effect would result, any adverse effect otherwise excluded by clause
(C) of the definition of “Intel Material Adverse Effect” shall be taken into account).

     (b) The execution, delivery and performance by Intel of this Agreement and the other
Transaction Documents to which Intel is a party, and the consummation of the transactions
contemplated hereby and thereby, do not and will not, as of the Closing Date, constitute a
default under, give rise to any right of termination, cancellation, modification,
acceleration of, or a loss of any material benefit under any Contract identified on
Schedule 3.4(b) of the Intel ATA Disclosure Letter; provided, however, that for the
avoidance of doubt, the Parties acknowledge and agree that the representations and
warranties set forth in this Section 3.4(b) shall not be deemed to be untrue or
inaccurate in any respect as a result of (i) any action or omission by Newco that
constitutes or results in a default by Intel or any Intel Affiliate or gives rise to any
right of termination, cancellation, modification, acceleration of, or a loss of any material
benefit under any such Contact; and (ii) any withdrawal or voiding after the Closing of any
consent granted prior to the Closing by a party to such Contract, which withdrawal or
voiding purports to have retroactive effect to the Closing.

     3.5 Personal Property. The Intel Transferors and Intel Transferred Entities together
have good and marketable title to, or a valid and subsisting leasehold interest in, all of the
tangible personal property that is a Intel Transferred Asset free and clear of any Lien, except for
(a) Permitted Liens and (b) any restriction contemplated by this Agreement or any of the other
Transaction Documents.

     3.6 Real Property.

     (a) Schedule 3.6(a) of the Intel ATA Disclosure Letter lists (i) the street
address of the Owned Intel Real Property and (ii) the current owner of such Owned Intel Real
Property. Intel or one of its Subsidiaries has good and marketable fee title to the Owned
Intel Real Property, free and clear of all Liens, other than Permitted Liens.

     (b) Schedule 3.6(b) of the Intel ATA Disclosure Letter lists (i) the street
address of the Leased Intel Real Property and (ii) the identity of the lessor, the lessee
and the current occupant (if different from the lessee) of each such parcel of Leased Intel
Real
Property. Intel or one of its Subsidiaries has a valid leasehold estate in all Leased
Intel Real Property, free and clear of all Liens, other than Permitted Liens. Each of the
Intel Leases (i) is valid and binding on the Intel Transferor or Intel Transferred Entity
which is party thereto and, to the Knowledge of Intel, on the counterparties thereto, and is
in full force and effect and (ii) upon consummation of the transactions contemplated by this
Agreement and the Intel Ancillary Agreements, except to the extent that any Intel

16

 

Contractual Consents are not obtained, shall continue in full force and effect without
penalty or other adverse consequence. No Intel Transferor, nor any Intel Transferred
Entity, is in breach of, or default under, any Intel Lease to which it is a party, except
for such breaches or defaults that would not reasonably be expected to have a Intel Material
Adverse Effect. Except as would not reasonably be expected to have a Intel Material Adverse
Effect, to the Knowledge of Intel, no other party to any Intel Lease is in breach thereof or
default thereunder and neither Intel nor any of its Subsidiaries has received any notice of
termination, cancellation, breach or default under any Intel Lease.

     3.7 Litigation. There is no Proceeding or to the Knowledge of Intel, investigation
pending or, to the Knowledge of Intel, threatened in writing, by or against Intel or any of its
Subsidiaries relating to the Intel Business or any Intel Transferred Asset (a) seeking to prevent,
enjoin, alter or delay the transactions contemplated by this Agreement or any other Transaction
Document or to materially encumber any Intel Transferred Asset, or (b) that would otherwise
reasonably be expected to have a Intel Material Adverse Effect. There is no Proceeding pending or,
to the Knowledge of Intel, threatened by or against any Intel Transferred Entity, except as would
not reasonably be expected to have a Intel Material Adverse Effect.

     3.8 Intel Transferred Contracts and Consents.

     (a) Except as would not reasonably be expected to have a Intel Material Adverse Effect,
each Intel Transferred Contract (i) is valid and binding on the Intel Transferor or the
Intel Transferred Entity which is party thereto and, to the Knowledge of Intel, the
counterparties thereto, and is in full force and effect and (ii) upon consummation of the
transactions contemplated by this Agreement, except to the extent that any Intel Contractual
Consents are not obtained, shall continue in full force and effect without penalty or other
adverse consequence. No Intel Transferor, nor any Intel Transferred Entity is in breach of,
or default under, any Intel Transferred Contract to which it is a party, except for such
breaches or defaults that would not reasonably be expected to have a Intel Material Adverse
Effect. Except as would not reasonably be expected to have a Intel Material Adverse Effect,
to the Knowledge of Intel, no other party to any Intel Transferred Contract is in breach
thereof or default thereunder and neither Intel, nor any of its Subsidiaries, has received
any notice of termination, cancellation, breach or default under any Intel Transferred
Contract.

     (b) Schedule 3.8(b) of the Intel ATA Disclosure Letter lists each material
Intel Transferred Contract that requires the consent of the other party or parties thereto
to be obtained by Intel or one of its Subsidiaries in connection with the execution and
delivery of this Agreement or the consummation of the transactions contemplated hereby to
avoid
the loss of any material benefit under, or any material modification to, such Intel
Transferred Contract (the “Intel Contractual Consents”).

     3.9 Compliance with Applicable Laws.

     (a) Intel and its Subsidiaries have complied with any Applicable Laws relating to the
Intel Business or the operation and use of the Intel Transferred Assets (including, in the
case of the Intel Transferred Entities, Applicable Laws relating to their

17

 

business operations and employees) and the Intel Transferred Interests, except where the failure to
comply would not reasonably be expected to have a Intel Material Adverse Effect. To the
Knowledge of Intel, no Intel Transferor is subject to any order, writ, injunction or decree
of any Governmental Authority directly relating to the Intel Transferred Assets. To the
Knowledge of Intel, no Intel Transferred Entity is subject to any material order, writ,
injunction or decree of any Governmental Authority.

     (b) Intel and its Subsidiaries are in possession of all Permits, except where the
failure to have, or the suspension or cancellation of, any of the Permits would not
reasonably be expected to have a Intel Material Adverse Effect. Intel and its Subsidiaries
are in compliance with all Permits and no suspension or cancellation of any of the Permits
is pending or, to the Knowledge of Intel, threatened in writing, except, in each case, where
the failure to so comply, or the suspension or cancellation of, any of the Permits would not
reasonably be expected to have a Intel Material Adverse Effect. Except as would not
reasonably be expected to have a Intel Material Adverse Effect, (i) none of the Intel
Transferred Permits will, assuming the related Intel Approvals and Newco Approvals have been
obtained prior to the Closing Date, be terminated or impaired or become terminable, in whole
or in part, as a result of the transactions contemplated hereby and by the Intel Ancillary
Agreements and (ii) upon consummation of such transactions, Newco or its Subsidiaries will,
assuming the related Intel Approvals and Newco Approvals have been obtained prior to the
Closing Date, have all of the right, title and interest in all of the Intel Transferred
Permits.

     (c) Except as would not reasonably be expected to have a Intel Material Adverse Effect,
the Intel Transferred Permits constitute all material Governmental Approvals necessary for
the ownership, lease or use of the Intel Transferred Assets and the operation of the Intel
Business after the Closing Date.

     3.10 Tax Matters.

     (a) Intel has paid or caused to be paid all material Taxes relating to the Intel
Transferred Assets and Intel Business allocable (as provided in Section 5.8(b)(iii))
to the Pre-Closing Tax Period that could become a liability of Newco or its Subsidiaries by
reason of the transfer of the Intel Transferred Assets to Newco or its Subsidiaries as
described herein or that would reasonably be expected to result in a Lien on any Intel
Transferred Assets, other than non-delinquent Taxes incurred in the ordinary course of
business since the Intel Financial Information Date in amounts consistent with prior periods
(as adjusted for changes in Tax rates and ordinary course fluctuations in
operating results). None of the Intel Transferors has an actual or contingent
liability for Taxes that will become a liability of Newco or its Subsidiaries by reason of
the transactions described herein, other than such non-delinquent Taxes described in the
immediately preceding sentence for which Newco or its Subsidiaries may become liable by
reason of statutory successor liability (or similar liability) under Applicable Law.

     (b) No Governmental Authority has claimed that the Intel Transferred Assets are subject
to Tax in a jurisdiction in which the required Tax Returns have not been filed by the Intel
Transferors.

18

 

     (c) No material issues have been raised in writing in any audits, examinations or
disputes pertaining to Taxes arising from the Intel Transferred Assets that can reasonably
be expected to be raised in similar examinations of Newco or its Subsidiaries following the
Closing.

     (d) With respect to each of the Intel Transferred Entities:

     (i) Each Intel Transferred Entity has properly prepared and timely filed all
Tax Returns required by law and has timely paid all Taxes due and payable (whether
or not shown on any Tax Return). All such Tax Returns are true, correct and
complete in all material respects. Each Intel Transferred Entity has complied in
all material respects with all Applicable Laws relating to Taxes. None of the Intel
Transferred Entities (A) is a party to or bound by any closing agreement, offer in
compromise, gain recognition agreement or any other agreement with any Governmental
Authority, except for those agreements identified on Schedule 3.10(e) of the
Intel ATA Disclosure Letter, or any Tax indemnity or Tax sharing agreement with any
Person, and (B) has actual or contingent liabilities for Taxes, other than (x) Taxes
accrued as a liability in the Intel Financial Information, or (y) non-delinquent
Taxes incurred in the ordinary course of business since the Intel Financial
Information Date in amounts consistent with prior periods (if applicable), as
adjusted for changes in Tax rates and ordinary course fluctuations in operating
results.

     (ii) There are and have been no (A) proposed, threatened or actual assessments,
audits, examinations or disputes as to Taxes relating to the Intel Transferred
Entities, (B) accounting method adjustments with respect to the Intel Transferred
Entities, or (C) waivers or extensions of the statute of limitations with respect to
Taxes for which the Intel Transferred Entities would reasonably be expected to be
held liable following the date hereof. No issues have been raised in any audits,
examinations or disputes pertaining to the Intel Transferred Entities that can
reasonably be expected to be raised in similar examinations following the Closing.
To the Knowledge of Intel, there is no basis for the assertion by a taxing authority
of a material Tax deficiency against the Intel Transferred Entities. None of the
Intel Transferred Entities is liable for Taxes of any other Person.

     (iii) Schedule 3.10(d)(iii) of the Intel ATA Disclosure Letter sets
forth, on an entity-by-entity basis, all jurisdictions in which each of the Intel
Transferred
Entities is subject to Tax and the type(s) of Tax. No Intel Transferred Entity
has engaged (or been treated as engaged) in the conduct of a trade or business or
had a permanent establishment (as defined in applicable tax treaty) in a
jurisdiction with respect to which the required Tax Returns have not been filed.

     (iv) Each Intel Transferred Entity has complied with all information reporting
and record keeping requirements under all Applicable Laws, including retention and
maintenance of required records with respect thereto.

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     (v) None of the Intel Transferred Entities is a party to any joint venture,
partnership, other arrangement or which could be treated as a partnership for any
applicable income Tax purposes.

     (vi) There is no taxable income or other measure of Tax of any of the Intel
Transferred Entities that will be reportable in the Post-Closing Tax Period that is
attributable to a transaction or event that occurred in a Pre-Closing Tax Period.

     (vii) No position has been taken on any Tax Return with respect to the Intel
Business or the Intel Transferred Assets that is contrary to any publicly announced
position of a Governmental Authority, or that is substantially similar to any
position that a Governmental Authority has successfully challenged in the course of
an examination of a Tax Return of the Intel Transferred Entities.

     (e) Schedule 3.10(e) of the Intel ATA Disclosure Letter sets forth in
reasonable detail, as to each Intel Transferred Entity, the Intel Business and the Intel
Transferred Assets, each applicable agreement, ruling or other arrangement with respect to
Taxes entered into with or received from any Governmental Authority, including the terms of
any agreement governing the pricing of products sold to Affiliates of Intel (each, an
“Intel Tax Agreement”). Each of Intel, its Affiliates and the Intel Transferred
Entities is in compliance with each Intel Tax Agreement in all material respects, and no
Governmental Authority has claimed or is expected to claim that any material breach of a
Intel Tax Agreement has occurred. None of Intel, its Affiliates or the Intel Transferred
Entities currently has outstanding any requests for Tax rulings pertaining to the Intel
Transferred Entities, the Intel Business or the Intel Transferred Assets that would
reasonably be expected to affect the liability for Taxes of Newco or its Subsidiaries after
the Closing Date.

     (f) The representations and warranties contained in this Section 3.10 are the
only representations and warranties being made with respect to compliance with or liability
under Applicable Laws relating to the Tax matters contemplated by this Section 3.10.

     3.11 Intellectual Property.

     (a) All material Intel Transferred Intellectual Property is free and clear of any Liens
other than Permitted Liens. One of the Intel Transferors owns or, to Intel’s Knowledge, is
licensed to use, all works of authorship and all associated Copyrights that
are embodied in the Intel Products. One of the Intel Transferors has good and
marketable sole title to the Intel Transferred Intellectual Property (other than with
respect to any moral rights therein or relating thereto). With respect to the Intel
Transferred Intellectual Property, Schedule 3.11(a) identifies all material
exclusive licenses granted by Intel or its Subsidiaries. Except as provided in the Intel
Intellectual Property Agreement or other Transaction Documents, upon the Closing hereof,
neither Intel nor any of its Affiliates shall retain any material rights under the Intel
Transferred Intellectual Property.

20

 

     (b) To the Knowledge of Intel, neither (i) the current use of the Intel Transferred
Intellectual Property by Intel or any of its Subsidiaries in its current operation of the
Intel Transferred Assets nor (ii) the current manufacture, marketing, distribution or sale
of any of the Intel Products by Intel or its Subsidiaries in their current operation of the
Intel Transferred Assets infringes any Copyrights or Trade Secret rights of any third party.
To the Knowledge of Intel, Intel has not received any written claims currently pending from
any Person claiming that the Intel Products infringe or misappropriate the Copyrights, Trade
Secrets or Patents of such Person.

     (c) Intel has taken commercially reasonable steps to protect its rights in Trade
Secrets of Intel embodied in the Intel Products including taking commercially reasonable
steps to have all of its current and former employees, consultants and contractors employed
in the Intel Business execute and deliver to Intel a proprietary information and invention
assignment agreement. To the Knowledge of Intel, it has not received written notice of any
violation of or non-compliance with such agreements.

     (d) To Intel’s Knowledge, neither Intel nor any of its Subsidiaries is subject to any
outstanding decree, order, or judgment that (i) restricts in any material manner the use,
transfer or licensing of the Intel Transferred Copyrights, the Intel Transferred Patents,
the Intel Transferred Trade Secrets or the Intel Products, or (ii) adjudges any of the Intel
Transferred Intellectual Property to be unenforceable or invalid.

     (e) All Intel Transferred Patents are currently in material compliance with formal
legal requirements involving the payment of fees to Governmental Authorities (including the
payment of filing, examination and maintenance fees). To the Knowledge of Intel, there are
no proceedings or actions pending before any court or tribunal (including the PTO or
equivalent authority anywhere in the world) that involve the validity, scope or priority of
Intel Transferred Intellectual Property. None of the Intel Transferred Copyrights are
registered Copyrights.

     (f) To Intel’s Knowledge, no software source code of material proprietary value to the
Intel Business is subject to obligations of public disclosure or distribution, under any
“open source license” or otherwise.

     3.12 Employee Matters.

     (a) Pension Plans. At no time has Intel or any other Person or entity under
common control with Intel within the meaning of Section 414(b), (c), (m) or (o) of the
Internal Revenue Code of 1986 and the regulations issued thereunder, contributed to or
been obligated to contribute to any Multiemployer Plan or any plan maintained pursuant
to a collective bargaining agreement or any plan subject to Title IV of ERISA.

     (b) Labor. No work stoppage or labor strike against Intel or any of its
Subsidiaries is pending or, to Intel’s Knowledge, threatened in writing or reasonably
anticipated with respect to the Intel Business Employees. Intel has no Knowledge of any
activities or proceedings of any labor union to organize any Intel Business Employees who
are not currently represented by a labor or trade union or employee representative

21

 

body. There are no actions, suits, claims, labor disputes or grievances pending, or, to the
Knowledge of Intel, threatened in writing or reasonably anticipated relating to any labor,
safety or discrimination matters involving any Intel Business Employee, including charges of
unfair labor practices or discrimination complaints, which, if adversely determined, would
reasonably be expected to have a Intel Material Adverse Effect. Neither Intel nor any of
its Subsidiaries is presently, nor has it been in the past, a party to, or bound by, any
collective bargaining agreement, collective agreement or recognition arrangement with any
labor or trade union, works council, European works council or other employee representative
body or union contract with respect to Intel Business Employees and no such agreement is
being negotiated by Intel with respect to the Intel Business Employees. The consent, notice
or opinion of any such employee representative body with respect to the Intel Business
Employees is not required to consummate any of the transactions contemplated by this
Agreement or any of the other Transaction Documents.

     (c) Intel Business Employee List. Schedule 3.12(c) of the Intel ATA
Disclosure Letter (i) sets forth the Intel Business Employees as of the date hereof and
identifies the country (and state, for those in the United States) in which each such Intel
Business Employee is based and primarily performs his or her duties and (ii) identifies
certain Newco Allocated Positions which shall be offered to certain employees of Intel in
accordance with Section 4.11(b) of the Master Agreement. Schedule 3.12(c)
shall be updated solely to reflect the change in employment status of any Intel Business
Employee, the amendments permitted by Section 4.11(b) of the Master Agreement and
such other changes as may reasonably be agreed upon by the Parties.

     (d) Nature of Representations and Warranties. The representations and
warranties contained in this Section 3.12 are the only representations and
warranties being made with respect to compliance with or liability under Applicable Laws
relating to the employment matters contemplated by this Section 3.12.

     3.13 Financial Information.

     (a) Intel has delivered to Newco copies of the estimated unaudited consolidated
statement of net revenue and direct expenses of the Intel Business for the year ended
December 30, 2006 (the “Intel Financial Information Date”) and the related estimated
net book value of the fixed assets and inventories of the Intel Business as of the Intel
Financial Information Date (collectively, the “Intel Financial Information”). The
Intel Financial Information has been prepared internally by Intel for management
reporting purposes only and has not been audited by any independent certified public
accountants or auditors.

     (b) The Intel Financial Information has been derived from the books and records of
Intel and have not been separately audited. The Intel Financial Information does not
contain all adjustments necessary to comply with GAAP. The Intel Financial Information does
not reflect the assets, liabilities, revenues and expenses that would have resulted if the
Intel Business had operated as an unaffiliated independent company;

22

 

provided, however, that
the Intel Financial Information includes estimations for allocation of various revenues,
costs and expenses on a reasonable basis.

     3.14 Absence of Certain Changes. Since the Intel Financial Information Date, other
than with respect to the transactions contemplated by the Transaction Documents, the Intel Business
has been conducted in the ordinary course of business, and there has not been:

     (a) (i) any sale, assignment or transfer of any of the material Intel Transferred
Assets or any license of any of the Intel Transferred Intellectual Property, except, in each
case, in the ordinary course of business and the transfer of Intel Transferred Assets to
Intel Transferred Entities as contemplated hereby, or (ii) any creation, assumption or
sufferance of (whether by action or omission) the existence of any Lien on any of the Intel
Transferred Assets, other than Permitted Liens;

     (b) any waiver, amendment, termination or cancellation of any material Intel
Transferred Contract or any relinquishment of any material rights thereunder by Intel or its
Subsidiary which is party thereto, or, to the Knowledge of Intel, any other party, other
than, in each such case, actions taken with respect to any such Intel Transferred Contract
in the ordinary course of business that are not material to the Intel Business;

     (c) any material change by Intel or any Subsidiary of Intel in its accounting
principles, methods or practices relating to the Intel Business or in the manner it keeps
its accounting books and records relating to the Intel Business, except (i) any such change
required by a change in GAAP or (ii) any change that results from the audit contemplated by
Section 5.2(h) of the Master Agreement;

     (d) any damage, destruction or other casualty loss that is material to the Intel
Transferred Assets taken as a whole;

     (e) (i) any failure to make an amount of capital expenditures described in the Intel
Business Capital Expenditures Plan that is material, in the aggregate, to the Intel Business
or (ii) any incurrence of any additional Intel Transferred Liabilities for capital
expenditures that are material, in the aggregate, to the Intel Business, except for those
described in the Intel Business Capital Expenditures Plan;

     (f) any failure to maintain the Intel Transferred Assets as a whole, in all material
respects in at least as good condition as they were being maintained on the Intel Financial
Information Date, subject to normal wear and tear;

     (g) any acquisition, directly or indirectly, of all or substantially all of the assets
of any business of or equity interests in any Person or business, whether by merger,
consolidation or otherwise, that relates to the Intel Business;

     (h) any creation, incurrence, assumption or guarantee, or modification of the terms, of
any Indebtedness with respect to the Intel Business, other than the Contemplated Financing,
except in the ordinary course of business;

     (i) any Intel Material Adverse Effect; or

23

 

     (j) any agreement for Intel or any of its Subsidiaries to take any of the actions
specified in paragraphs (a) through (h) above.

     3.15 Environmental Matters.

     (a) Except as would not reasonably be expected to have a Intel Material Adverse Effect:
(i) Intel and each of its Subsidiaries, in each case with respect to the Intel Transferred
Assets or the Intel Business, and each Intel Transferred Entity is in compliance with all
applicable Environmental Laws; (ii) Intel and each of its Subsidiaries, in each case with
respect to the Intel Transferred Assets or Intel Business, and each Intel Transferred Entity
has obtained, and is in material compliance with, all Environmental Permits; (iii) neither
Intel nor any of its Subsidiaries, in each case with respect to the Intel Transferred Assets
or the Intel Business nor any Intel Transferred Entity is conducting or funding, or is
required to conduct or fund, any Remedial Action pursuant to any Environmental Law; (iv) to
Intel’s Knowledge, no property to which a Intel Transferred Entity or, in connection with
the Intel Business, Intel has, directly or indirectly, transported or arranged for the
transportation of any Hazardous Substances is listed on any list of sites requiring
investigation or cleanup promulgated by any relevant Governmental Authority; (v) there are
no claims relating to any Environmental Law pending or, to the Knowledge of Intel,
threatened in writing against Intel or any of its Subsidiaries, in each case with respect to
the Intel Transferred Assets or the Intel Business, or any Intel Transferred Entity; and
(vi) to Intel’s Knowledge, there has been no environmental investigation, study, audit,
test, review or other analysis conducted within the past five years that documents
conditions giving rise to any material Environmental Liability, that relates to the Intel
Transferred Assets, the Leased Intel Real Property, the Intel Business, any Intel
Transferred Entity or any other property or facility now or previously owned or leased by
Intel in connection with the Intel Business, and that has not been delivered to Newco within
at least five days of the date hereof.

     (b) The representations and warranties contained in this Section 3.15 are the
only representations and warranties being made with respect to compliance with or liability
under Environmental Laws, including natural resources, related to the Intel Business, the
Intel Transferred Assets or Intel’s or its Subsidiaries’ ownership or operation thereof.

     3.16 Product Warranties. A copy of Intel’s product warranties currently in effect
with respect to the Intel Products as set forth in the
order acknowledgement forms for the Intel Products (the “Intel Standard Form Product
Warranties”) is set forth on Schedule 3.16 of the Intel ATA Disclosure Letter. Neither
Intel nor any of its Subsidiaries has given any written product warranty with respect to the Intel
Products other than the Intel Standard Form Product Warranties. The Intel Products, taken as a
whole, comply in all material respects with all such product warranties and all material
specifications applicable to the Intel Products. To the Knowledge of Intel, there are no
outstanding material claims with respect to product warranties relating to the Intel Products. As
of the Closing Date, the Intel Products constitute all of the products produced or sold by Intel or
any of its Subsidiaries exclusively related to the Intel Business.

24

 

     3.17 Intel Transferred Assets. The Intel Transferred Assets and the assets made
available to Newco or its Subsidiaries under, or to be used by Intel and its Subsidiaries in the
performance of, the Intel Ancillary Agreements will, as of the Closing, constitute all of the
material assets (other than any Intellectual Property) necessary for the conduct of the Intel
Business as it is conducted by Intel and its Subsidiaries as of the Closing Date.

     3.18 Customers. Schedule 3.18 of the Intel ATA Disclosure Letter lists the
names of the 10 largest customers to whom the Intel Business has sold products during the year
ended December 30, 2006 (based on dollar amount of revenue recognized in connection with the sale
of such Intel Products during such year). To Intel’s Knowledge, neither Intel nor any of its
Subsidiaries has received any written statement from any customer whose name appears on
Schedule 3.18 of the Intel ATA Disclosure Letter that such customer will not continue as a
customer of the Intel Business after the Closing.

     3.19 Insurance. Intel has delivered to Newco summaries of all material insurance
policies and fidelity bonds relating to the Intel Transferred Assets and the Intel Business. There
are no material Claims by Intel or any of its Subsidiaries pending under any of such policies or
bonds as to which coverage has been questioned, denied or disputed by the underwriters of such
policies or bonds or in respect of which such underwriters have reserved their rights.

     3.20 Inventories. The estimated, unaudited book value of the Intel Transferred
Inventories set forth in the Intel Financial Information were determined in a manner not materially
inconsistent with GAAP. As of the end of Intel’s first fiscal quarter of 2007, the estimated
unaudited Intel Inventory Value is as set forth on Schedule 3.20 to the Intel ATA
Disclosure Letter. Such estimated, unaudited book value of the Intel Transferred Inventories and
the Intel Inventory Value were prepared internally by Intel for management reporting purposes only,
have not been audited by any independent certified public accountants or auditors and are further
qualified by the limitations set forth in Section 3.13(b). Since the Intel Financial
Information Date, the levels of Intel Transferred Inventory have been maintained in the ordinary
course of business. The Intel Transferred Inventories are owned free and clear of all Liens other
than Permitted Liens.

     3.21 Advisory Fees. There is no investment banker, broker, finder or other
intermediary or advisor that has been retained by or is authorized to act on behalf of Intel, who
will be entitled to any fee, commission or
reimbursement of expenses from any Person other than Intel upon consummation of the
transactions contemplated by this Agreement.

     3.22 Representations Regarding Intel Transferred Entities and Intel Transferred
Interests.

     (a) Organization. Each Intel Transferred Entity is duly organized, validly
existing and in good standing under the laws of its jurisdiction of organization (to the
extent such concept is recognized in such jurisdiction) and has all requisite power and
authority required to carry on its business as now conducted and to own and operate the
Intel Business as now owned and operated by it. Each Intel Transferred Entity is, or will
be, as of the Closing Date, qualified to conduct business and in good standing (to the
extent such concept is recognized in such jurisdiction) in each jurisdiction in which it

25

 

conducts the Intel Business other than such jurisdictions where the failure to be so
qualified would not reasonably be expected to have a Intel Material Adverse Effect. The
Intel Transferred Entities and their respective jurisdictions of organization are identified
on 
Schedule 3.22(a).

     (b) Capitalization.

          (i) As of the Closing, the authorized share capital of the Intel Transferred
Entities shall be as set forth in Schedule 3.22(b) of the Intel ATA
Disclosure Letter, and of such authorized share capital, only the Intel Transferred
Interests shall be issued and outstanding. As of the Closing, no other shares of
the Intel Transferred Entities shall have been authorized or designated as a series
or shall be issued and outstanding. As of the Closing, all of the Intel Transferred
Interests shall have been duly authorized, validly issued, fully paid and
non-assessable, shall have been issued in material compliance with all Applicable
Laws and shall have been issued in compliance with all applicable preemptive rights
created by statute, the charter or other governing instruments of the Intel
Transferred Entities and any agreement to which such Intel Transferred Entities are
bound or by which their properties or assets are bound.

          (ii) As of the Closing, there shall not be outstanding (A) any options,
warrants or other rights to purchase from any Intel Transferred Entity any capital
stock or other securities of such Intel Transferred Entity, (B) any securities,
notes or other indebtedness convertible into or exchangeable for shares of such
capital stock or securities, (C) any other commitments or rights of any kind for any
Intel Transferred Entity to issue additional shares of capital stock, options,
warrants or other securities or (D) any equity equivalent or other ownership
interests in any Intel Transferred Entity or similar rights.

          (iii) As of the Closing, Intel and its Subsidiaries shall be the sole
registered and beneficial owners of the Intel Transferred Interests and the Intel
Transferred Interests shall be free and clear of all Share Encumbrances. Upon
delivery of certificates evidencing certificated Intel Transferred Interests to
Newco or a Subsidiary of Newco together with any executed share transfer deeds
or instruments for the Intel Transferred Interests necessary to transfer the Intel
Transferred Interests under Applicable Law, and payment by Newco of the amount due
and payable to Intel pursuant to Section 2.6, Newco or a Subsidiary of Newco
will acquire good and marketable title to such Intel Transferred Interests, free and
clear of any Share Encumbrance.

     (c) Ownership. Schedule 3.22(c) of the Intel ATA Disclosure Letter
sets forth the identity of each of the holders of equity interests in the Intel Transferred
Entities and their respective ownership interests in the Intel Transferred Entities. The
Intel Transferred Entities do not have any Subsidiaries and do not, directly or indirectly,
own any equity investment or other ownership interest in any Person. No Intel Transferred
Entity is a participant in any joint venture, partnership or similar arrangement.

26

 

     (d) Indebtedness. No Intel Transferred Entity has any outstanding
Indebtedness.

     3.23 Investment Representations.

     (a) Investigation; Economic Risk. Intel acknowledges that it has had an
opportunity to discuss the business, affairs and current prospects of Newco with Newco’s
officers. Intel further acknowledges having had access to information about Newco that it
has requested. Intel acknowledges that it is able to fend for itself in the transactions
contemplated by this Agreement and has the ability to bear the economic risks of its
investment in Newco pursuant to this Agreement. Intel is an “accredited investor,” as such
term is defined in Rule 501 of Regulation D promulgated under the Securities Act.

     (b) Purchase for Own Account. The Intel Newco Shares will be acquired for the
account of Intel or an Affiliate of Intel, not as a nominee or agent, and not with a view to
or in connection with the sale or distribution of any part thereof. The Intel Option Shares
will be acquired for the account of the holder of the Intel Option, not as a nominee or
agent, and not with a view to or in connection with the sale or distribution of any part
thereof.

     (c) Exempt from Registration; Restricted Securities. Intel understands that
the Intel Newco Shares and Intel Option Shares will not be registered under the Securities
Act, on the basis that the sale provided for in this Agreement is exempt from registration
under the Securities Act, and that the reliance of Newco on such exemption is predicated in
part on Intel’s representations set forth in this Agreement. Intel understands that the
Intel Newco Shares and Intel Option Shares being issued hereunder are restricted securities
within the meaning of Rule 144 under the Securities Act; that the Intel Newco Shares and
Intel Option Shares are not registered and must be held indefinitely unless they are
subsequently registered or an exemption from such registration is available.

     3.24 Disclaimer of Warranties. EXCEPT WITH RESPECT TO THE WARRANTIES AND
REPRESENTATIONS
SPECIFICALLY SET FORTH IN THIS ARTICLE III (WHICH MAY BE RELIED UPON BY NEWCO), ALL OF THE
TRANSFERRED ASSETS ARE BEING SOLD “AS IS, WHERE IS,” AND NEITHER INTEL NOR ANY OF ITS SUBSIDIARIES
MAKES ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, ORAL OR WRITTEN, WHETHER OF
MERCHANTABILITY, SUITABILITY, NONINFRINGEMENT OR FITNESS FOR A PARTICULAR PURPOSE, OR QUALITY AS TO
THE TRANSFERRED ASSETS OR ANY PART OR ITEM THEREOF, OR AS TO THE CONDITION, DESIGN, OBSOLESCENCE,
WORKING ORDER OR WORKMANSHIP THEREOF, OR THE ABSENCE OF ANY DEFECTS THEREIN, WHETHER LATENT OR
OTHERWISE.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF NEWCO

     Newco hereby represents and warrants to Intel, as of the date of this Agreement, as follows:

27

 

     4.1 Existence and Good Standing. Newco has been duly organized and is validly
existing as a private company with limited liability (besloten vennootschap met beperkte
aansprakelijkheid) under Dutch law and has all requisite power and authority required to carry on
its business as now conducted and to own and operate its businesses as now owned and operated by
it. Newco has heretofore delivered to Intel complete and correct copies of its articles of
association and governance rules as currently in effect. Each Subsidiary of Newco has been duly
organized, validly existing and in good standing under the laws of its jurisdiction of
incorporation and has all requisite power and authority required to carry on its business as now
conducted and to own and operate its business as now owned and operated by it. Newco has
heretofore delivered to Intel complete and correct copies of the articles of incorporation and
bylaws or other organizational documents of each Subsidiary of Newco.

     4.2 Authorization and Enforceability. Newco has all requisite corporate power and
authority to execute and deliver this Agreement and each of the Transaction Documents to which it
is or will be a party and to perform its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby. The execution and delivery by Newco of this
Agreement and each of the Transaction Documents to which it is a party and the performance by Newco
of its obligations contemplated hereby and thereby have been duly and validly authorized by all
necessary corporate action. This Agreement has been, and when executed at the Closing the other
Transaction Documents to which Newco is a party will have been, duly and validly executed and
delivered by Newco, and assuming the due execution and delivery of this Agreement and the other
Transaction Documents to which it is a party by Intel and each of the other parties thereto, this
Agreement constitutes, and as of the Closing each of the Transaction Documents to which Newco is a
party will constitute, the legal, valid and binding agreement of Newco, enforceable against Newco
in accordance with their respective terms, except to the extent (a) that their enforceability may
be subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect relating to creditors’ rights generally or to general principles of equity or
(b) indemnification provisions contained in the Shareholders’ Agreement may be limited by
applicable securities laws.

     4.3 Non-Contravention. The execution, delivery and performance by each of Newco and
its Subsidiaries of the other Transaction Documents to which it is a party, and the consummation of
the transactions contemplated hereby and thereby, do not and will not contravene or conflict with
the articles of association or governance rules of Newco or the organizational documents of any of
its Subsidiaries.

     4.4 Capitalization. Immediately following the Closing, the capitalization of Newco
will consist of the following:

     (a) Ordinary Shares. A total of                      Ordinary Shares of Newco will be
authorized, of which                                 shares will be issued and outstanding, of which
                     Ordinary Shares will be held by Intel                      and Ordinary Shares will be
held by ST. Newco will have sufficient authorized share capital with respect to its
Ordinary Shares upon a conversion of the Preferred Shares in accordance with the terms and
conditions of the Shareholders Agreement and sufficient authorized share capital with
respect to its Ordinary Shares for issuance under the Equity Plan (of which no such shares
shall be subject to outstanding options, and all of which shares shall

28

 

be available for
future issuance). The Outstanding Ordinary Shares will have been validly issued, will be
fully paid upon transfer of the Intel Transferred Assets and the ST Transferred Assets to
Newco, and will have been issued in accordance with the registration or qualification
provisions of all applicable securities laws, or pursuant to valid exemptions therefrom.

     (b) Preferred Shares. A total of                      Preferred Shares will be
authorized, of which                      Preferred Shares will be issued and outstanding all of
which will be held by FP. The Outstanding Preferred Shares will have been validly issued,
will be fully paid upon receipt of the Purchase Price by Newco, and will have been issued in
accordance with the registration or qualification provisions of all applicable securities
laws, or pursuant to valid exemptions therefrom.

     (c) Options, Warrants, Reserved Shares. Except for (i) the conversion
privileges of the Preferred Shares; (ii) the rights to purchase new securities set forth in
the Shareholders’ Agreement and mandatory provisions of the laws of The Netherlands; and
(iii) the Intel Option, there are no options, warrants, conversion privileges or other
rights (or agreements for any such rights) outstanding to purchase or otherwise obtain from
Newco any of Newco ‘s securities. There exists no Newco obligation (contingent or
otherwise) to purchase, redeem or otherwise acquire any of its equity securities or any
interest therein.

     4.5 Valid Issuance of Shares.

     (a) The Intel Newco Shares and the Intel Option, when issued, sold and delivered in
accordance with the terms of this Agreement, and the Intel Option Shares, when issued, sold
and delivered in accordance with the terms of the Intel Option, will be duly and validly
issued, fully paid upon receipt of the Exercise Price (as defined in the Intel Option), and
will be free of restrictions on transfer other than restrictions on transfer
under the Equity Transaction Documents, the laws of The Netherlands and applicable
securities laws.

     (b) The outstanding shares of Newco are duly and validly issued and fully paid upon
receipt of the Purchase Price and the consummation of the Intel Asset Transfer Agreement and
the ST Asset Contribution Agreement, and such shares of such capital stock, and all
outstanding shares, options and other securities of Newco have been issued in full
compliance with exemptions from the registration requirements of the Securities Act, and are
exempt from registration or qualification under the registration, permit or qualification
requirements of all applicable state securities laws and all other provisions of applicable
federal and state securities laws and applicable laws of The Netherlands, including, without
limitation, anti-fraud provisions.

     4.6 Exempt Offering. Based in part upon Intel’s representations in Section
3.23, the offer and sale of the Intel Newco Shares and Intel Option pursuant to this Agreement
and the Intel Option Shares pursuant to the Intel Option are exempt from the registration
requirements of Section 5 of the Securities Act by virtue of Regulation D thereunder, from the
qualification requirements of the California Corporate Securities Law of 1968, by virtue of Section
25102(f)

29

 

thereof, and from the registration or qualification requirements of any other applicable
foreign or state securities laws.

     4.7 Lack of Registration Rights and Voting Agreements. Except as set forth in the
Shareholders’ Agreement, Newco has not granted or agreed to grant any registration rights to any
Person. There is no agreement or restriction relating to the voting of any shares of Newco other
than as set forth in the Shareholders’ Agreement.

     4.8 Reliance. In executing this Agreement and the Intel Ancillary Agreements to which
it is a party, Newco and its Subsidiaries are relying on the investigations by ST and FP (or its
Affiliates), and on the provisions set forth herein and therein and not on any other statements,
presentations, representations, warranties or assurances of any kind made by Intel, its
representatives or any other Person. Newco acknowledges that (a) the representations and
warranties of Intel contained in Article III hereof constitute the sole and exclusive
representations and warranties of Intel to Newco in connection with this Agreement and the
transactions contemplated hereby and (b) all other representations and warranties are specifically
disclaimed and may not be relied upon or serve as a basis for a claim against Intel. NEWCO
ACKNOWLEDGES THAT INTEL DISCLAIMS ALL WARRANTIES OTHER THAN THOSE EXPRESSLY CONTAINED IN THIS
AGREEMENT AS TO THE INTEL TRANSFERRED ASSETS, WHETHER EXPRESS OR IMPLIED, ORAL OR WRITTEN,
INCLUDING ANY WARRANTY OF MERCHANTABILITY OR WARRANTY FOR FITNESS FOR A PARTICULAR PURPOSE. EXCEPT
FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED EXPRESSLY IN THIS AGREEMENT, NEWCO IS ACQUIRING
THE INTEL TRANSFERRED ASSETS ON AN “AS IS, WHERE IS” BASIS.

ARTICLE V

COVENANTS

     5.1 Access to Information.

     (a) Newco shall permit Intel to retain copies of Intel Books and Records for its
internal use or for audit, tax or regulatory purposes or for any use required by Applicable
Law and shall maintain for six years after the Closing Date all of the Intel Books and
Records pertaining to the Intel Transferred Entities, Intel Transferred Assets and the Intel
Transferred Liabilities relating to periods prior to the Closing. Newco shall provide Intel
and its representatives, during normal business hours and upon reasonable notice from Intel,
with reasonable access to such Intel Books and Records. If, at any time after the sixth
anniversary of the Closing Date, Newco proposes to dispose of any of such books and records,
Newco shall first offer to deliver the same to Intel at the expense of Intel.

     (b) Each Party (the “Possessing Party”) will afford the other Party (the
“Receiving Party”), its counsel and its accountants, during normal business hours,
reasonable access to information in the Possessing Party’s possession or control relating to
the Intel Transferred Assets, the Intel Transferred Liabilities, the Intel Transferred
Entities and the Intel Business, and, to the extent reasonably requested, at the Receiving
Party’s expense, will provide copies and extracts therefrom, all to the extent that such

30

 

access may be reasonably required by the Receiving Party in connection with (i) the
preparation of Tax Returns, (ii) compliance with the requirements of any Governmental
Authority or (iii) to facilitate the resolution of claims made by a third party against or
incurred by Intel or Newco pertaining to the Intel Transferred Assets, the Intel Transferred
Liabilities, the Intel Transferred Entities or the Intel Business; provided, however, that
nothing in this Section 5.1(b) shall be deemed to require any Party to disclose any
information that it is prohibited from disclosing under any non-disclosure agreement entered
into prior to the date of the Master Agreement or in the ordinary course of business after
the date of the Master Agreement.

     5.2 Compliance with Terms of Governmental Approvals and Consents. From and after the
Closing Date, Newco shall comply at its own expense with all conditions and requirements imposed on
Newco as set forth in (a) Newco Approvals that are Governmental Approvals, to the extent necessary
such that all such Governmental Approvals will remain in full force and effect assuming, if
applicable, continued compliance with the terms thereof by Intel and (b) all Newco Approvals of
Persons other than Governmental Authorities, to the extent necessary such that all such consents
and approvals will remain effective and enforceable against the Persons giving such consents and
approvals, assuming, if applicable, continued compliance with the terms thereof by Intel.

     5.3 Use of Marks. Notwithstanding any other provision, no interest in or right to use
the name “INTEL” or any derivation thereof or any other Trademarks, service marks or tradenames of
Intel, other than the Intel Transferred Trademarks, (the “Intel Retained Marks”) is being
transferred or otherwise licensed to Newco
pursuant to the transactions contemplated by this Agreement. Newco agrees not to use any
materials bearing Intel Retained Marks or sell, transfer or ship any products bearing Intel
Retained Marks (a) unless requested to do so by Intel, (b) except to the extent displayed on the
hardcopy (non-electronic) form of such materials delivered to Newco at the Closing, (c) except as
required under Intel Transferred Contracts with customers or (d) except on Intel Transferred
Inventory, product instructions, labeling, containers, data sheets, specifications and any similar
materials directly related to the Intel Transferred Inventory in existence as of the Closing Date
until, in all cases, the earliest of (i) the sale or disposition of such Inventory or other
materials, (ii) such time as Newco shall have qualified the use of its logo, Trademark or
tradenames with each such customer and (iii) 180 days after the Closing Date or such other period
as is permitted under the Intel Transition Services Agreement or the Intel Intellectual Property
Agreement solely for the purposes set forth therein. Further, dies manufactured by or for Newco
using mask sets included in the Intel Transferred Assets may bear Intel Retained Marks only to the
extent that it is not commercially reasonable to manufacture dies using such mask sets that do not
bear such Intel Retained Marks. The foregoing rights are subject to Intel’s standard Trademark
usage guidelines, a copy of which has been provided to Newco, to any applicable provisions of the
Intel Transition Services Agreement, and to any applicable provisions of the Intel Intellectual
Property Agreement, and Intel reserves the right to practice quality control with regard to its
marks and any products or services marketed or sold thereunder. Newco shall comply with any
reasonable instructions of which it is notified by Intel relating to Intel’s exercising of such
quality control rights. Upon the expiration of the foregoing license, all materials bearing any
Intel Retained Mark in the possession or control of Newco or its agents shall be promptly
destroyed. Prior to any distribution of any materials bearing Intel Retained Marks, Newco shall
use commercially

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reasonable efforts to redact or modify such materials in order to minimize or
eliminate the use of the Intel Retained Marks.

     5.4 Cooperation in Third Party Litigation. Each Party shall provide such assistance
and cooperation as the other Party or its counsel may reasonably request in connection with any
claims, Proceedings or investigations relating to the Intel Business or the Intel Transferred
Assets, Intel Transferred Liabilities, Intel Transferred Entities; provided, that the Party making
such request shall reimburse each such other Party for its reasonable and documented out-of-pocket
costs and expenses in providing such assistance; provided that such assistance shall not
unreasonably interfere with the business and operations of any such other Party.

     5.5 Assignments

     (a) Intel will reasonably cooperate with Newco in transferring applications and
registrations for the Intel Transferred Copyrights, Intel Transferred Trademarks and the
Intel Transferred Patents to the extent that Intel has applied for or obtained registrations
therefor; provided, however, that following the Closing, subject to Section 5.4,
Intel shall not have or incur any further obligations or expenses in connection therewith,
and it shall be the sole responsibility of Newco to pursue, protect or perfect any such
rights as it may see fit in its sole discretion.

     (b) Following the Closing, in the event that (i) Intel identifies Intel Excluded Assets
that have been erroneously identified for delivery or delivered to Newco, Newco
shall use commercially reasonable efforts to return such Intel Excluded Assets to Intel
at Intel’s expense or (ii) Newco identifies Intel Transferred Assets that any Intel
Transferor has failed to deliver to Newco or a Subsidiary of Newco or a Intel Transferred
Entity, such Intel Transferor shall use commercially reasonable efforts to deliver such
Intel Transferred Assets to Newco or such Subsidiary of Newco at Intel’s expense.

     5.6 Reasonable Efforts. Each of Newco and Intel will cooperate and use its
commercially reasonable efforts to take, or cause to be taken, all appropriate actions (and to
make, or cause to be made, all filings and notifications necessary, proper or advisable under
Applicable Law) to consummate and make effective the transactions contemplated by this Agreement
and the Transaction Documents, including its commercially reasonable efforts to obtain, as promptly
as practicable, all licenses, permits, consents, approvals, authorizations, qualifications and
orders of Governmental Authorities and parties to contracts, as are necessary for the consummation
of the transactions contemplated by this Agreement and the Transaction Documents to which it is a
party.

     5.7 Allocation of Non-Tax Operating Expenses. All utility charges, gas charges,
electric charges, water charges, water rents and sewer rents, if any, shall be apportioned between
Newco and Intel as of the Closing Date, computed on the basis of the most recent meter charges or,
in the case of annual charges, on the basis of the established fiscal year. All Prepayments
(including lease expenses but excluding Taxes and Intel Prepayments) paid by Intel prior to the
Closing Date and all other operating expenses paid by Newco with respect to the Intel Business
shall be apportioned between Newco and Intel as of the Closing Date computed on the basis of the
applicable time period to which expenses apply. Within 90 days after the Closing, each Party

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shall present a statement to the other Party setting forth the amount of reimbursement to which each is
entitled under this Section 5.7, together with such supporting evidence as is reasonably
necessary to calculate the proration amount. Such amount shall be paid by the Party owing it to
the other within 10 days after delivery of such statement.

     5.8 Tax Matters.

     (a) Tax Returns. Intel shall prepare or cause to be prepared all Tax Returns
with respect to the Intel Transferred Assets and the Intel Business for the Pre-Closing Tax
Period, other than the Tax Returns of the Intel Transferred Entities for taxable periods
that end following the Closing Date. Newco shall prepare or cause to be prepared all Tax
Returns with respect to the Intel Transferred Assets and the Intel Business for the
Post-Closing Tax Period and of the Intel Transferred Entities for taxable periods ending
after the Closing Date. All Tax Returns with respect to the Intel Transferred Entities,
Intel Transferred Assets or Intel Business prepared by Newco for taxable periods that
include but do not end on the Closing Date (each such period, a “Straddle Period”)
shall be prepared in a manner consistent with prior Tax Returns filed by the Intel
Transferred Entities, except as otherwise required by Applicable Law. To the extent Intel
would be liable for all or any portion of the Taxes shown on any Straddle Period Tax Return,
such Tax Return shall be provided to Intel no later than 30 days prior to the filing
thereof, and any disputes concerning the manner in which such Tax Returns are prepared shall
be resolved as provided in Section 5.8(h). Newco shall not amend or permit to be
amended
any Tax Returns with respect to a Intel Transferred Entity to the extent such amendment
could increase the liability of Intel hereunder.

     (b) Responsibility for Payment of Taxes. Except as otherwise provided in this
Section 5.8:

     (i) Intel shall be liable for and shall indemnify, defend and hold Newco
harmless from and against (A) all Taxes arising from the Intel Transferred Assets or
the Intel Business with respect to the Pre-Closing Tax Period, including all Taxes
of the Intel Transferred Entities attributable to the Pre-Closing Tax Period to the
extent not paid prior to the Closing, (B) all Taxes imposed on any Intel Transferred
Entity as a result of being or having been a member of an affiliated, consolidated,
combined, unitary, fiscal unity or similar group of which Intel or any of its
Affiliates is or was a member, other than Taxes arising from the income, assets or
operations of Newco and its Subsidiaries during the Post-Closing Tax Period, and (C)
all Taxes imposed on any Intel Transferred Entity as a result of being or having
been party to any tax sharing, tax indemnity or tax allocation agreement or any
other express or implied agreement to indemnify any other Person for Taxes that was
entered into prior to the Closing, other than Taxes arising from the income, assets
or operations of Newco and its Subsidiaries during the Post-Closing Tax Period;
provided, however, that Taxes arising on the Closing Date by reason of actions taken
by or at the request of Newco out of the ordinary course of business following the
Closing and without the consent of Intel shall be the responsibility of Newco.

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     (ii) Newco shall be liable for and shall indemnify, defend and hold Intel
harmless from and against all Taxes arising from the Intel Transferred Assets or the
Intel Business with respect to the Post-Closing Tax Period, including all Taxes of
the Intel Transferred Entities attributable to the Post-Closing Tax Period, except
to the extent that such Taxes are Intel’s obligation under Section 5.8(b)(i)
or are subject to indemnification from Intel pursuant to Section 6.2(a) (but
subject to Section 6.2(g)) and except for any Taxes imposed on Intel or its
Affiliates by virtue of their ownership of equity in Newco. 

     (iii) Taxes with respect to any of the Intel Transferred Entities for a
Straddle Period shall be calculated by means of a closing of the books and records
of such Intel Transferred Entity as of the close of the Closing Date, as if such
Straddle Period ended as of the close of the Closing Date; provided that exemptions,
allowances or deductions that are calculated on an annual basis (including
depreciation and amortization deductions computed as if the Closing Date was the
last day of the taxable period) shall be allocated between the portion of the period
ending on the Closing Date and the portion of the period after such day in
proportion to the number of days in each such period; and, provided, further, that
personal property, ad valorem and other similar Taxes that are not based on income,
revenue, expenses or any combination thereof (“Property Taxes”) for a
Straddle Period shall be allocated between the Pre-Closing Tax Period and the
Post-Closing Tax Period in proportion to the number of days in
each such period (except as provided in the immediately succeeding sentence).
Property Taxes with respect to the Intel Transferred Assets other than those owned
by the Intel Transferred Entities shall be allocated similarly. Intel shall be
liable for the amount of such Taxes that is attributable to the Pre-Closing Tax
Period (other than to the extent of any increase in Property Taxes attributable to
the transactions described herein), and Newco shall be liable for the proportionate
amount of such Taxes that is attributable to the Post-Closing Tax Period (including
any increase in Property Taxes attributable to the transactions described herein).

     (iv) Within a reasonable period after the Closing, and from time to time
thereafter upon the receipt by a Party of a bill, assessment or other notice of Tax
due, Intel and Newco shall present a statement to the other setting forth the amount
of reimbursement to which each is entitled under this Section 5.8(b),
together with such supporting evidence as is reasonably necessary to calculate the
amount owed. The amount owed shall be paid by the Party owing it to the other
within 10 days after delivery of such statement or, if later, 3 days prior to the
time such Taxes are required to be paid to the appropriate Governmental Authority.
In the event that either Intel or Newco makes a payment for which it is entitled to
reimbursement under this Section 5.8(b), the other Party shall pay such
reimbursement promptly, but in no event later than 30 days after the presentation of
a statement setting forth the amount of reimbursement to which the presenting Party
is entitled along with such supporting evidence as is reasonably necessary to
calculate the amount of reimbursement. Any payment required under this Section
5.8(b) and not made when due shall bear interest at the rate of 10% per annum.

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     (c) Sales and Use Taxes. All Sales Taxes incurred by Intel or its Affiliates
in connection with the transfer of Intel Transferred Assets to a Intel Transferred Entity
(whether such Sales Taxes arise upon such transfer or upon the transfer of the underlying
Intel Transferred Interests to Newco or its Subsidiaries) shall be borne by Intel or its
Affiliates (but not the Intel Transferred Entities) to the extent such Sales Taxes exceed
the Sales Taxes that would have been incurred if the underlying Intel Transferred Assets
were transferred directly by the historical owner thereof to Newco or a Subsidiary of Newco
(located in the same jurisdiction as such Intel Transferred Entity) without the intervening
transfer to such Intel Transferred Entity. All other Sales Taxes incurred by the Parties or
their Affiliates as a consequence of the transfer of the Intel Transferred Assets (including
the Intel Transferred Interests) to Newco shall be determined as soon as practicable after
the Closing based on the allocation described in Section 5.9 and shall be borne 50%
by Newco and 50% by Intel; provided, however, that in no event shall Newco’s share of such
Sales Taxes exceed $5,000,000. Notwithstanding the foregoing, Newco or its Subsidiaries
shall pay 100% of all Sales Taxes to the extent the payment thereof by Newco or such
Subsidiaries gives rise to a right to claim a refund of or credit against Taxes otherwise
payable by Newco or its Subsidiaries under Applicable Law (and such amount shall not count
toward the $5,000,000 cap in the preceding sentence). To the extent permitted by Applicable
Law, Newco and Intel shall cooperate and use commercially reasonable efforts to minimize
such Sales Taxes. To the extent a taxing authority provides notice to Intel or Newco of an
audit of Sales Taxes for which the other
Party has any responsibility hereunder, the Party receiving the notice shall promptly
notify the other Party. The Parties shall cooperate as reasonably requested to defend any
audit with respect to Sales Taxes described herein, and the Party responsible therefor shall
pay when due any additional Sales Taxes ultimately assessed (together with any interest,
penalties or additions to tax with respect thereto) in the ratios described above. Intel
shall control all Sales Tax audits where Intel or its Affiliates bear 100% of the underlying
Sales Tax, and Intel and Newco shall jointly control all other Sales Tax audits (and share
equally all related professional fees, interest, penalties and additions to tax) pertaining
to the transfer of the Intel Transferred Assets to Newco. With respect to Sales Taxes for
which the Parties bear joint responsibility hereunder, neither Party shall settle any
proposed adjustment to such Sales Taxes without the other Party’s prior written approval,
not to be unreasonably withheld or delayed.

     (d) Cooperation. As to the Taxes for which Intel is liable hereunder or that
arise in a Straddle Period, the Parties hereto agree to furnish or cause to be furnished to
one another, upon request, as promptly as practicable, such information and assistance
relating to the Intel Transferred Assets, the Intel Business and the Intel Transferred
Entities as is reasonably necessary for the filing of all Tax Returns, the preparation for
any audit by any taxing authority, and the prosecution or defense of any claim or Proceeding
relating to any Tax Return. The Parties hereto shall cooperate with each other in the
conduct of any audit or other Proceeding related to Taxes involving the Intel Business.

     (e) Allocation of Intel Consideration among the Intel Transferred Assets. The
Intel Consideration (including the Intel Transferred Liabilities to the extent treated as
“amount realized” for United States federal income tax purposes) shall be allocated

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among the Intel Transferred Assets and the Intel Transferred Interests in accordance with
Schedule 5.8(e) of the Intel ATA Disclosure Letter (as such allocation shall be
determined prior to Closing and attached hereto immediately prior to the Closing). Such
schedule shall be prepared in a manner consistent with the Third Party Appraisal. Each of
the Parties hereto agrees to report the transactions contemplated hereby for state, federal
and foreign Tax purposes in accordance with such allocation of the Intel Consideration.
Intel shall prepare Schedule 5.8(e) of the Intel ATA Disclosure Letter subject to
Newco’s approval, which approval shall not be unreasonably withheld. Such schedule shall be
adjusted for any changes to the Intel Cash Consideration, in a manner consistent with the
Third Party Appraisal and otherwise as Intel determines in its reasonable discretion.

     (f) Treatment of Indemnity Payments. The Parties shall treat all
indemnification payments made under this Agreement as an adjustment to the Intel Cash
Consideration for applicable Tax purposes.

     (g) Tax Dispute Resolution. If the Parties are unable to resolve any disputes
regarding the content of Tax Returns for which Intel has a right of review pursuant to
Section 5.8(a), the issue or issues shall be referred for resolution to a partner at
a “Big 4” accounting firm (or other nationally recognized accounting firm) reasonably
acceptable to the Parties, who shall be requested to resolve open issues, on the basis of
the position
most likely to be sustained if challenged in a court having initial jurisdiction over
the matter (which for federal income tax issues shall be deemed to be the United States Tax
Court). The decision of such accounting firm shall be final and binding on the Parties, and
the costs of such accounting firm shall be Newco costs. If such Tax Returns become due
(taking into account extensions of time to file, which Newco shall seek as necessary to
avoid the delinquent filing of its Tax Returns) they shall be filed as determined by Newco
and shall be amended and re-filed as required by the outcome of the referral to the
accounting firm as provided herein.

     5.9 Accounts Receivable. Following the Closing, (a) if Intel or any of its
Subsidiaries receives any payment, refund or other amount that is a Intel Transferred Asset or is
otherwise properly due and owing to Newco in accordance with the terms of this Agreement, Intel
promptly shall remit, or shall cause to be remitted, such amount to Newco and (b) if Newco or any
of its Subsidiaries receives any payment, refund or other amount that is a Intel Excluded Asset or
is otherwise properly due and owing to Intel or any of its Subsidiaries in accordance with the
terms of this Agreement, Newco promptly shall remit, or shall cause to be remitted, such amount to
Intel. Without limiting the foregoing, Newco shall forward to Intel, immediately upon receipt
thereof, any payments of Pre-Closing Accounts Receivable of Intel or any of its Subsidiaries, and
Intel shall forward to Newco, immediately upon receipt thereof, any payments of Post-Closing
Accounts Receivable of Newco or any of its Subsidiaries unless otherwise set forth in the Intel
Transition Services Agreement. Following the Closing, the Parties shall cooperate in promptly
advising customers to direct to the appropriate Party any future payments by such customers. In
determining whether a payment received by either Party is a payment of an Account Receivable of
Intel or Newco, the receiving Party may rely on any invoice or contract number referred to on the
payment or in correspondence accompanying such payment. To the extent any payment, refund or other
amount received by Intel or Newco from a customer

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or other account debtor does not specify which
outstanding invoice or receivable it is in payment of, such payment shall be applied to the
earliest invoice outstanding with respect to indebtedness of such customer or other account debtor,
except for those invoices which are subject to a dispute to the extent of such dispute. Following
the Closing, Newco will provide such cooperation as Intel shall reasonably request in connection
with Intel’s collection of outstanding Pre-Closing Accounts Receivable of Intel and its
Subsidiaries.

     5.10 Accounts Payable. To the extent that Newco receives any invoices for Pre-Closing
Accounts Payable of Intel or any of its Subsidiaries or statements evidencing amounts owed by Intel
or any of its Subsidiaries to another Person, Newco will promptly deliver such documents to Intel.
To the extent that Intel receives any invoices for Accounts Payable of Newco or any of its
Subsidiaries or statements evidencing amounts owed by Newco or any of its Subsidiaries to another
Person, Intel will promptly deliver such documents to Newco unless otherwise set forth in the Intel
Transition Services Agreement.

     5.11 Employees.

     (a) To the greatest extent permitted by Applicable Law, Newco shall provide service
credit for all periods of service by the Intel Transferred Employees under Newco’s employee
policies and plans except to the extent such service credit would
result in the duplication of benefit accrual for the same period of service. Newco
shall be responsible for all Liabilities, salaries, benefits and similar employer
obligations that arise after Closing under Newco’s compensation and benefit plans and
policies for all Intel Transferred Employees or pursuant to Section 2.3(d). In
particular, Newco shall be responsible for liabilities with respect to the termination of
any Intel Transferred Employees by Newco after the Closing, including health care
continuation coverage with respect to plans established or maintained by Newco after the
Closing to the extent that the Intel Transferred Employees participate therein, and damages
or settlements arising out of any claims of wrongful, constructive or illegal termination or
dismissal by Newco following the Closing, and for complying with the requirements of all
Applicable Laws with respect to any such termination by Newco after the Closing. Subject to
Section 2.3(d), Intel shall be solely responsible for any liabilities or obligations
with respect to Intel Transferred Employees under the Intel Employee Plans or the Intel
Employee Agreements that arise following the Closing.

     (b) Non- U.S. Intel Business Employees. With respect to Intel Business
Employees located outside the United States, each of Newco and Intel agrees to comply with
all covenants, agreements and obligations set forth in Schedule 5.11(b) of the Intel
ATA Disclosure Letter.

     (c) Funded Employee Plans. To the extent that Newco is required under
Applicable Law to assume Liabilities with respect to a Intel Funded Employee Plan relating
to service of Intel Transferred Employees prior to the Closing Date, and unless such
obligations are not otherwise satisfied at or prior to the Closing Date among Intel, Newco
and the relevant Intel Transferred Employees, Intel shall, or shall cause the applicable
Intel Subsidiary to, pay to Newco an amount in cash or cash equivalents equal to such
Liabilities as of the Closing Date as determined in accordance with this Section

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5.11(c) (the “Intel Funded Employee Plan Amount”). Intel shall, or shall cause
the applicable Intel Subsidiary to, cause the Intel Funded Employee Plan Amount to be
transferred to Newco as soon as practicable following the Closing Date, but in no event more
than 15 days following the determination of the amount due hereunder. The Intel Funded
Employee Plan Amount shall be determined in accordance with Applicable Law and the relevant
provisions of the Intel Funded Employee Plan. To the extent required by Applicable Law or
by the Intel Funded Employee Plan, Intel shall, or shall cause the applicable Intel
Subsidiary to, require the actuary of each Intel Funded Employee Plan (each, an “Intel
Actuary”) to determine, prior to the Closing Date, the Intel Funded Employee Plan Amount
for the relevant Intel Funded Employee Plan in accordance with FAS 158 on a projected
benefit obligation basis based on actuarial assumptions no less favorable than those used in
the most recent actuarial report prepared for the relevant Intel Funded Employee Plan. The
actuarial calculations and assumptions of the Intel Actuary may be reviewed for accuracy by
an actuary designated by Newco (the “Newco Actuary”). If the Intel Actuary and the
Newco Actuary cannot reach an agreement as to the proper determination for the Intel Funded
Employee Plan Amount with respect to a Intel Funded Employee Plan, Intel and Newco shall
refer such matter to an independent third-party actuary (which actuary shall be mutually
agreeable to Intel and Newco) (the “Third Actuary”) for resolution. Promptly, but
in no event later than 45 days after such referral, the Third Actuary shall review the Intel
Actuary’s calculation of the relevant
Intel Funded Employee Plan Amount and the Newco Actuary’s objection and calculations
with respect thereto, and shall provide each of Intel and Newco a written statement of its
decision as to the issues in dispute and the determination of the Intel Funded Employee Plan
Amount. Such determination shall be final and binding for all purposes. The fees and
expenses of the Intel Actuary and the Newco Actuary shall be borne by Intel. The fees and
expenses of the Third Actuary shall be borne equally by Intel and Newco.

     (d) Consultation Obligations. Intel and Newco shall where and to the extent
required by Applicable Law or by an applicable collective bargaining, collective agreement,
recognition arrangement or other similar agreement or arrangement inform and consult with
employees, trade unions, works councils or other employee representative bodies regarding
the transactions contemplated by this Agreement, including the offers of employment made
pursuant to the Master Agreement.

     (e) Non-Solicitation of Employees.

     (i) Subject to Applicable Law, for two years following the Closing, without the
prior written consent of Newco, Intel shall not, nor shall it permit any of its
Subsidiaries to, directly or indirectly, recruit or solicit any employee of Newco or
any of its Subsidiaries (collectively, for purposes of this Agreement, the
“Newco Restricted Employees”) to leave his or her employment with Newco or
such Subsidiary.

     (ii) Except as (A) may be otherwise provided herein, (B) otherwise agreed by
Intel and Newco, or (C) prohibited by Applicable Law, for two years following the
Closing Date, Newco shall not, nor shall it permit any of its Subsidiaries to,
directly or indirectly, recruit or solicit (x) any employee of Intel

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or any of its Subsidiaries other than those Intel Business Employees who become employed by Newco
in accordance with the terms of the Master Agreement, (y) any Intel Business
Employee who declines an offer of employment from or objects to his or her transfer
to Newco, or (z) any employee of IM Flash Technologies, LLC, IM Flash Singapore,
LLP, or any of their respective Subsidiaries, to leave his or her employment with
Intel, IM Flash Technologies, LLC, IM Flash Singapore, LLP, or any such Subsidiary
(collectively, for purposes of this Agreement, the “Intel ATA Restricted
Employees”).

     (iii) Neither the placement of employment advertisements or other general
solicitation for employees not specifically targeted to any Newco Restricted
Employee or Intel ATA Restricted Employee, as the case may be, by any means,
including through the use of hiring agencies or through employees of each Party who
are unaware of the prohibitions against the solicitation of the Newco Restricted
Employees or Intel ATA Restricted Employees, as the case may be, shall be a
recruitment or solicitation prohibited by this Section 5.11(e) provided that
any such hiring agencies and employees are not instructed by persons who knew about
the prohibition on the solicitation of such Restricted Employees to solicit for hire
such Restricted Employees. If a Party (or any Subsidiary thereof) inadvertently
violates the prohibition against the solicitation
of Restricted Employees, such Party shall (or it shall cause its applicable
Subsidiary to), as soon as it is aware it has committed a violation of this section,
notify the other Party who formerly employed such Restricted Employee and either
withdraw any offer to the solicited individual or ensure that such person, if hired,
is restricted from working on, consulting on, or having any knowledge with respect
to matters which are designated by written notice by the Party that formerly
employed such employee in its reasonable discretion as competitively sensitive
matters, in which event such inadvertent action shall not be deemed to be a breach
of this Section 5.11(e) so long as there is no repetitive pattern of such
actions.

     (f) Newco Employee Recruitment. For a period of six months following the
Closing Date, Newco agrees to notify Intel of any employment opportunities at Newco within a
reasonable period of time before the placement of employment advertisements or other general
solicitation, including the use of hiring agencies, with respect to such employment
opportunities.

     5.12 Protection of Privacy. The Customer Data of Intel has been collected by Intel
over the Internet under the conditions set forth in the Intel Privacy Policy attached to
Schedule 5.12 of the Intel ATA Disclosure Letter (the “Intel Privacy Policy”) and
is transferred to Newco subject to the obligations set forth in the Intel Privacy Policy. Newco
covenants and agrees that it will not use such Customer Data in any manner that conflicts with the
terms of the Intel Privacy Policy.

     5.13 Export Compliance. From and after the Closing Date, Newco shall comply at its
own expense with all conditions and requirements imposed on Newco required to comply with all
applicable U.S. Export Administration Regulations and such other similar regulations,

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including any
applicable export regulations of foreign jurisdictions, that are imposed on the Intel Transferred
Assets. Newco agrees that it will not export, either directly or indirectly, any Intel Product or
associated technology or systems incorporating such Intel Product without first obtaining any
required license or other approval from the appropriate host Governmental Authority with
appropriate authority.

     5.14 Satisfaction of Intel Pre-Closing Product Obligations. After the Closing, Newco
agrees to satisfy any and all Intel Pre-Closing Product Obligations. Unless otherwise agreed by
the Parties in the Transaction Documents, Newco shall, on a monthly basis, following the month in
which the transactions occur, or any other periodic basis as agreed by the Parties,
deliver to Intel a written statement of costs reasonably incurred by Newco in satisfying any such
Intel Pre-Closing Product Obligations, which statement shall set forth all such Intel Pre-Closing
Product Obligations satisfied by Newco during such period. Promptly following receipt of such
statement, Intel shall reimburse Newco for all such costs.

     5.15 Additional Intel Financial Statements. For 12 months following the Closing Date
(or if later, the date of completion of the audit of the Intel annual financial statements for the
year in which the Closing
Date occurs), Intel shall, in good faith, use commercially reasonable efforts to assist Newco
with Newco’s preparation of such financial statements, for such periods prior to the Closing Date
as may be required for Newco to undertake a registered public offering of debt securities or
Ordinary Shares, as the case may be, it being understood that in connection with any such
registered offering Newco shall use commercially reasonable efforts to obtain waivers from certain
financial statement requirements, provided that any failure by Newco to obtain any such waiver
shall not relieve Intel from its obligations under this Section 5.15. Notwithstanding the
foregoing, nothing herein shall obligate Intel to provide any audited financial statement or
information to Newco or to submit to an audit by Newco’s auditors of any financial statement or
information or books and records of Intel.

     5.16 Settlement of Claims. Intel shall not settle, or make any binding offer to
settle, any material Claim or Proceeding relating to the Intel Business unless such settlement
would not encumber any assets of Newco, impose any obligation or other Liability on Newco, impose
any restriction that would apply to Newco or the conduct of Newco’s business, or include any
acknowledgment of validity, enforceability, infringement, or Claim interpretation with regard to
any of the Intellectual Property relating to such Claim or Proceeding.

     5.17 Back-end Equipment.

     (a) From and after the Closing Date, Intel shall, and shall cause its Subsidiaries to,
retain physical possession of the D2 Equipment until the earlier of (i) the date upon which
such D2 Equipment is removed therefrom pursuant to a Newco Removal Notice (as defined below)
and (ii) 60 days after completion of sorted wafer manufacturing for Newco using the D2
Equipment and the receipt by Newco from Intel of written notice of such completion;
provided, however, that in the event that any Governmental Approval is required for the
removal of any of such D2 Equipment, Newco and Intel shall use their reasonable commercial
efforts to obtain such Governmental Approval as soon as practicable after the Closing Date,
and in the event that such Governmental Approvals are not obtained within 45 days prior to
the Removal

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Date set forth above, the Removal Date shall be extended to that date which is
45 days after all such Governmental Approvals have been obtained.

     (b) Newco shall use commercially reasonable efforts to make all arrangements necessary
to ensure that the D2 Equipment is removed from the premises of Intel and its Subsidiaries
as soon as reasonably practicable following the completion of the applicable sorted wafer
manufacturing set forth in Section 5.17(a) and the receipt of notice thereof from
Intel and in any event prior to the Removal Date applicable thereto.

     (c) From and after the Closing Date until 15 days prior to each applicable Removal
Date, Newco may notify Intel in writing of Newco’s intention to remove the D2 Equipment from
the premises of Intel or its Subsidiaries. Each such notice (a “Newco Removal
Notice”) shall describe in reasonable detail the arrangements for the removal and
transportation of the D2 Equipment, including (i) the dates on which Newco proposes to begin
and complete the removal of the D2 Equipment, (ii) the identity of any third party
contractors that Newco proposes to engage in connection therewith and (iii) a
reasonable estimate of the third party costs expected to be incurred by Newco in
connection therewith.

     (d) All reasonable and documented third party costs of removing D2 Equipment from the
premises of Intel or its Subsidiaries and transporting D2 Equipment to the premises of Newco
or its Subsidiaries shall be borne by Intel. Newco shall remove the D2 Equipment in its
entirety from the premises of Intel and its Subsidiaries prior to the Removal Date
applicable thereto. The removal of the D2 Equipment shall be effected during regular
business hours in a manner reasonably intended to minimize disruption and without causing
damage to the affected Intel facility. Intel shall have the right to approve in advance
(which approval shall not be unreasonably withheld or delayed) any third party contractors
that Newco proposes to engage to complete such removal or transportation. In the event that
any D2 Equipment is not removed from the premises of Intel or its Subsidiaries prior to the
Removal Date applicable thereto, Intel may treat such D2 Equipment as abandoned property and
may have such D2 Equipment removed from the applicable Intel facility or may sell such D2
Equipment and remit the proceeds of such sale (net of all direct and indirect costs of sale
and expenses incurred by Intel and its Subsidiaries) to Newco.

     5.18 Master Agreement Covenants. Newco agrees to be bound by and shall be a third
party beneficiary of the following Sections of the Master Agreement: Section 4.5 (Press
Releases), Section 4.8 (Tax Matters), Section 4.9 (Operations of the Intel Business
Prior to the Closing), Section 4.10 (Operations of the ST Business Prior to the Closing),
Section 4.12 (Additions to and Modifications of the Schedules), Section 4.14
(Notices of Certain Intel Events), Section 4.15 (Notices of Certain ST Events), Section
4.17 (Newco Tax Election), Section 4.19 (Cooperation with Financing), Section
4.21 (Hynix JV Matters), Section 4.22 (Facility Transfer Term Sheets), Section
4.25 (ST Litigation), Section 4.26 (Intel Litigation) and Section 4.28 (Further
Assurances) of the Master Agreement as though it were a party thereto.

     5.19 Further Assurances. Each Party agrees to execute and deliver, or cause to be
executed and delivered, such other documents, certificates, agreements and other writings and to

41

 

take, or cause to be taken, such other commercially reasonable actions as may be necessary or
desirable in order to consummate or implement expeditiously the transactions contemplated by this
Agreement.

     5.20 Outstanding Checks; Bank Accounts.

     (a) Intel shall cause all checks written but not cashed before the Closing in respect
of obligations of any Intel Transferred Entity to be paid.

     (b) Intel shall cause all bank accounts of the Intel Transferred Entities to have zero
balances on the Closing Date.

     5.21 Release of Liens. On the Closing Date, the Intel Transferors shall deliver the
Intel Transferred Assets to Newco and its
Subsidiaries free and clear of Liens, other than Permitted Liens, except as otherwise provided
herein.

ARTICLE VI

INDEMNIFICATION

     6.1 General Survival. The representations and warranties of the Parties contained in
this Agreement and the covenants set forth in Section 4.9 of the Master Agreement shall
survive the Closing for a period of 12 months after the Closing Date; provided, however that (a)
representations and warranties set forth in Section 3.10 (Tax Matters) shall survive until
the expiration of the statute of limitations for the collection of the Tax that is the subject of
such representation or warranty, (b) representations and warranties set forth in each of
Section 3.2 (Authorization and Enforceability), Section 3.12(a) (Pension Plans),
and Section 3.22(a) and (b) (Organization and Capitalization of the Intel
Transferred Entities) shall survive until the expiration of the applicable statute of limitations,
(c) representations and warranties set forth in Section 3.15 (Environmental Matters) shall
survive until the date that is 10 years following the Closing Date, and (d) any claim arising out
of the fraudulent misrepresentation of Intel contained in this Agreement or any other Transaction
Document shall survive until the expiration of the applicable statute of limitations. In addition,
any indemnity with respect to any Intel Pre-Closing Environmental Liability described in
Section 2.4(k) hereof shall survive until the date that is 10 years following the Closing
Date and shall thereupon expire. Upon such expiration, unless written notice of a claim for
indemnification based on such representation, warranty, covenant or indemnity specifying in
reasonable detail the facts on which the claim is based shall have been delivered to the Indemnitor
prior to the expiration of such representation, warranty, covenant, or indemnity, such
representation, warranty, covenant or indemnity shall be deemed to be of no further force or
effect, as if never made, and no action may be brought based on the same, whether for
indemnification, breach of contract, tort or under any other legal theory. All covenants and
agreements of the Parties otherwise set forth in this Agreement with respect to Excluded
Liabilities or actions of the Parties following the Closing shall survive indefinitely to the
extent necessary to give effect to their terms.

     6.2 Indemnification.

     (a) Indemnification Provisions for Newco. Subject to the provisions of
Section 6.1, from and after the Closing Date, the Newco Indemnitees shall be

42

 

indemnified and held harmless by Intel from and against and in respect of any and all Losses
(as defined below) incurred by any Newco Indemnitee resulting from:

     (i) any inaccuracy or breach of any of Intel’s representations or warranties
contained in this Agreement or in the certificates furnished to Newco pursuant to
Sections 5.2(a) and 5.3(a) of the Master Agreement (disregarding the
qualifications as to Intel Material Adverse Effect expressly set forth in such
certificates in accordance with Sections 5.2(a) and 5.3(a));

     (ii) any breach of any covenant or agreement made or to be performed by Intel
pursuant to this Agreement or any of the Sections of the Master Agreement set forth
in Section 5.18 of this Agreement;

     (iii) any failure of Intel to satisfy any Intel Excluded Liabilities; and

     (iv) any Taxes or expenses required to be paid by Intel under this Agreement.

     (b) Indemnification Provisions for Intel. Subject to the provisions of
Section 6.1, from and after the Closing Date, the Intel Indemnitees shall be
indemnified and held harmless by Newco from and against and in respect of any and all Losses
(as defined below) incurred by any Intel Indemnitee, resulting from:

     (i) any inaccuracy or breach of any of Newco’s representations or warranties
contained in this Agreement other than any such inaccuracy or breach that results
from any action that (A) Newco is required to take hereunder or (B) Intel has
approved under the Master Agreement;

     (ii) any breach of any covenant or agreement made or to be performed by Newco
pursuant to this Agreement;

     (iii) any failure of Newco to satisfy any Intel Transferred Liabilities, other
than the Intel Excluded Liabilities; and

     (iv) any Taxes or expenses required to be paid by Newco under this Agreement.

     (c) For purposes of this Agreement, the term “Indemnitee” shall mean either a
Newco Indemnitee or a Intel Indemnitee, as the case may be, and the term
“Indemnitor” shall mean either Newco or Intel, as the case may be.

     (d) Notwithstanding the above, Losses shall not include expenses incurred in connection
with investigations unless a claim is made by a third party against the Indemnitee.

     (e) No Newco Indemnitee shall be entitled to indemnification for any Losses covered by
Section 6.2(a)(i) until the aggregate amount of all such Losses of the Newco
Indemnitees shall exceed $15,000,000 (the “Intel ATA Basket”), at which time all
such

43

 

Losses incurred in excess of the Intel ATA Basket shall be subject to indemnification
by the relevant Indemnitor hereunder. The Intel ATA Basket shall not apply to Losses
covered by Section 3.2 (Authorization and Enforceability), Section 3.10 (Tax
Matters), Section 3.12(a) (Pension Plans), Section 3.15 (Environmental
Matters), Section 3.22(a) and (b) (Organization and Capitalization of the
Transferred Entities) or Sections 6.2(a)(ii)-(iv). No Intel Indemnitee shall be
entitled to indemnification for any Losses covered by Section 6.2(b)(i) until the
aggregate amount of all such losses of the Intel Indemnitees shall exceed $15,000,000
(“Newco ATA Basket”), at which time all such losses incurred in excess of the Newco
ATA Basket shall be subject to
indemnification by the relevant Indemnitor hereunder. The Newco ATA Basket shall not
apply to Losses covered by Sections 6.2(b)(ii)-(iv).

     (f) The amount of any Losses otherwise recoverable under this Section 6.2 shall
be reduced by (i) any amounts which the Indemnitees actually receive under insurance
policies, net of all reasonable and documented costs and expenses of recovery, the Parties
hereby acknowledging and agreeing that as soon as practicable after becoming aware of such
Losses and in any event prior to payment of any amount of Losses otherwise recoverable under
this Section 6.2, the Indemnitee must first seek reimbursement for any and all
Losses from any applicable insurance coverage (and that any compensation provided under this
Agreement is not to be deemed insurance for any purpose), and (ii) any reduction in Tax
otherwise actually payable by the Indemnitees (or their Subsidiaries) (net of related Tax
and out of pocket costs incurred in connection with such reduction) with respect to the
taxable year of such Persons in which the payment of such indemnity is due or a prior
taxable year, including refunds of Taxes (net of such Tax and other out-of-pocket costs)
previously paid by such Persons with respect to such taxable years to the extent the claim
for refund may be filed in such years.

     (g) Notwithstanding anything to the contrary in Section 6.2(a), Losses for
which Newco may claim indemnification under this Agreement shall not include Taxes arising
in Post-Closing Tax Periods, determined in the manner provided in Section
5.8(b), except for (i) interest, penalties and additions to Tax accrued with
respect to Taxes arising in a Pre-Closing Tax Period, (ii) Losses arising from a breach of
the representation set forth in Section 3.10(d)(vi), and (iii) Losses for Taxes that
are allocated to Intel pursuant to Section 5.8.

     (h) For any additions or modifications to the schedules to the Intel ATA Disclosure
Letter made by Intel under Section 4.12(d) of the Master Agreement (i) to correct
inaccuracies of the Specified Intel Representations (including those representations and
warranties which are expressed with respect to a date prior to the date of the Master
Agreement) for facts, events or circumstances occurring prior to or existing on and as of
the date of the Master Agreement, and, in the case of a representation or warranty made to
the Knowledge of Intel, of which Intel had Knowledge on such date), (ii) to reflect any
facts, events or circumstances which resulted from a breach of Section 4.9 of the
Master Agreement, or (iii) to update, correct or otherwise modify any of the representations
and warranties set forth in Section 3.2 (Authorization and Enforceability),
Section 3.4 (Non-contravention), Section 3.7 (Litigation), Section
3.9 (Compliance with Applicable Laws), Section 3.10 (Tax Matters), Section
3.11 (Intellectual Property),

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Section 3.13 (Financial Information), Section
3.14 (Absence of Certain Changes), Section 3.17 (Intel Transferred Assets),
Section 3.20 (Inventories), Section 3.21 (Advisory Fees), Section
3.22 (Transferred Entities and Transferred Interests), and Section 3.23
(Investment Representations), for any reason, then, in each case, Newco shall be entitled to
indemnification therefor pursuant to, and subject to the limitations set forth in this
Article VI, to the same extent as if such additions and modifications had not been
made.

     6.3 Manner of Indemnification.

     (a) Each indemnification claim shall be made only in accordance with this Article
VI.

     (b) If an Indemnitee wishes to make a claim for Losses under Article VI of this
Agreement, Indemnitee shall deliver a Notice of Claim to the applicable Indemnitor promptly
after becoming aware of the facts giving rise to such claim. The Notice of Claim shall (i)
specify in reasonable detail the nature of the claim being made, and (ii) state the
aggregate dollar amount of such claim.

     (c) Following receipt by an Indemnitor of a Notice of Claim, the Parties shall promptly
meet to agree on the rights of the respective Parties with respect to each of such claims.
If the Parties should so agree, a memorandum setting forth such agreement shall be prepared
and signed by both Parties and amounts agreed upon shall be promptly paid. Any unresolved
dispute between the Parties shall be resolved in accordance with Section 7.10 and
Section 7.11 and the other applicable provisions of this Agreement.

     6.4 Third-Party Claims. If Newco becomes aware of a claim of a third party
(including for all purposes of this Section 6.4, any Governmental Authority) that Newco
believes, in good faith, may result in a claim by it or any other Newco Indemnitee against Intel,
Newco shall notify Intel of such claim as promptly as practicable; provided, that any failure to so
notify Intel shall not relieve Intel of its obligations hereunder, except to the extent such
failure shall have materially adversely prejudiced Intel. Intel shall have the right, but not the
duty, to assume and conduct the defense of such claim at its expense; provided, however, that Intel
may not assume control of the defense of a suit or proceeding involving criminal liability. Intel
shall conduct such defense in a commercially reasonable manner, and shall be authorized to settle
any such claim without the consent of Newco, provided, however, that: (a) Intel shall not be
authorized to encumber any assets of Newco or agree to any restriction that would apply to Newco or
the conduct of Newco’s business; (b) Intel shall have paid or caused to be paid any amounts arising
out of such settlement; (c) a condition to any such settlement shall be a complete release of Newco
and any other Newco Indemnitee against whom such claim has been made with respect to such third
party claim; and (d) Intel shall not be authorized to settle any claim that would reasonably be
expected to have a material effect on a Tax liability of Newco that is not subject to
indemnification by Intel hereunder without Newco’s consent, which consent shall not be unreasonably
withheld or delayed. With respect to any claim for which Intel assumes the defense of Newco, Newco
shall be entitled to participate in (but not control) the defense of such third party claim, with
its own counsel and at its own expense, and Newco shall take such action as Intel shall reasonably
request to assist Intel in the defense of any such third party claim, provided that Intel shall
reimburse Newco for any reasonable out-of-pocket expenses incurred in

45

 

taking any such requested
action. If Intel does not assume the defense of any third party claim in accordance with the
provisions hereof, Newco may defend such third party claim in a commercially reasonable manner and
may settle such third party claim after giving written notice of the terms thereof to Intel, and
such legal expenses shall be indemnifiable Losses hereunder to the extent that Newco is determined
to be entitled to indemnification hereunder for such third party claim.

     6.5 Exclusive Remedy and Waiver and Release of Certain Claims.

     (a) Notwithstanding any other provision of this Agreement to the contrary, the
provisions of this Article VI shall be the sole and exclusive remedy for monetary
damages of the Indemnitees from and after the Closing Date for any Losses arising under this
Agreement or relating to the transactions contemplated by this Agreement, including claims
of breach of any representation or warranty in this Agreement or any covenant set forth in
Section 4.9 of the Master Agreement; provided, however, that the foregoing clause of
this sentence shall not be deemed a waiver by any Party of any right to specific performance
or injunctive relief but shall be deemed a waiver of any rights of rescission.
Notwithstanding any other provision of this Agreement, (i) the maximum aggregate liability
of Intel to Newco Indemnitees pursuant to this Article VI or otherwise under this
Agreement, Applicable law or otherwise (other than Uncapped Intel Losses) shall be limited
to $86,400,000 (the “Intel ATA Cap”); and (ii) the maximum aggregate liability of
Newco to the Intel Indemnitees for Losses pursuant to this Article VI or otherwise
under this Agreement (other than with respect to Losses pursuant to a breach of Section
4.2 (Authorization and Enforceability) and Section 4.6 (Capitalization) and
Losses pursuant to Section 6.2(b)(iii)), Applicable Law or otherwise shall be
limited to the Intel ATA Cap. Nothing in this Agreement limits or otherwise affects in any
way the rights and remedies of either Party with respect to causes of action arising under
the Intel Intellectual Property Agreement, the Intel Facility Transfer Agreements and the
Intel Transition Services Agreement, or any rights and remedies of Intel or Newco vis-à-vis
any Person other than Intel or Newco or their respective Affiliates with respect to any
infringement or misappropriation of any Intellectual Property of Intel or Newco, as the case
may be (including any right of Intel or Newco to seek equitable or injunctive relief in
connection therewith), all of which rights and remedies are expressly reserved.
Notwithstanding the foregoing, the existence of this Section 6.5 and the rights and
restrictions set forth in this Article VI do not limit any other potential remedies
of the Indemnitees with respect to fraud by any Party.

     (b) Except with respect to the specific remedies identified in Section 6.5(a)
above, the Parties hereby waive and release any and all claims, causes of action, and rights
as against one another for the transactions contemplated by this Agreement, including the
assets and liabilities that are allocated herein, based upon statute or common law. This
waiver and release specifically includes, without in any way limiting the scope of the
foregoing waiver and release, any claims the Parties may have against one another based upon
the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section
9601 et seq. or any other Applicable Law under which the Parties or their Affiliates would
otherwise have any cause of action against one another.

46

 

     6.6 Subrogation. If the Indemnitor makes any payment under this Article VI in
respect of any Losses, the Indemnitor shall be subrogated, to the extent of such payment, to the
rights of the Indemnitee against any insurer or third party with respect to such Losses; provided,
however, that the Indemnitor shall not have any rights of
subrogation with respect to the other Party hereto or any of its Affiliates or any of its or
its Affiliates’ officers, directors, agents or employees.

     6.7 Damages. Notwithstanding anything to the contrary elsewhere in this Agreement or
any other Transaction Document, no Party (or its Affiliates) shall, in any event, be liable to the
other Party (or its Affiliates) for any consequential damages, including, but not limited to, loss
of revenue or income, cost of capital, or loss of business reputation or opportunity relating to
the breach or alleged breach of this Agreement. Each Party agrees that it will not seek punitive
damages as to any matter under, relating to or arising out of the transactions contemplated by this
Agreement or the other Transaction Documents.

     6.8 Environmental Indemnification Procedures.

     (a) Intel and Newco agree that the Indemnitor shall have the sole right to disclose,
report, further investigate, negotiate, perform and settle any Intel Facility Environmental
Liability or conduct any Remedial Action in connection therewith for which such Indemnitor
may have liability hereunder, and the Indemnitee will provide the Indemnitor access and any
other rights, as necessary, to the Owned Intel Real Property, the Leased Intel Real
Property, or any other real property under the Indemnitee’s control for purposes of
investigating and performing any such Remedial Action. Such terms of access shall provide
for reasonable protections to the Indemnitee’s operations to minimize disruption and protect
its employees. Nonetheless, if at any time following the Closing Date, the Indemnitor has
not taken action to disclose, report, further investigate, negotiate, perform and settle any
Intel Facility Environmental Liability or conduct any Remedial Action in connection
therewith for which such Indemnitor may have liability hereunder, to the reasonable
satisfaction of the Indemnitee, then the Indemnitee will have the right, after first
providing written notice to the Indemnitor and a reasonable period for the Indemnitor to
respond (at a minimum 30 days) and subject to the rights of the Indemnitor set forth in
Section 6.8(c) below, to disclose, report, further investigate, negotiate, perform
and settle any Intel Facility Environmental Liability or conduct any Remedial Action in
connection therewith, provided that the Indemnitor’s duty to indemnify under Section
6.1 of the Agreement for Intel Facility Environmental Liabilities shall not apply to the
extent that the Indemnitee’s actions fail to comply with paragraph (b), below. Without
limiting the generality of the foregoing, in connection with any action taken pursuant to
the third sentence of this Section 6.8(a) the Indemnitee will, subject to the rights
of the Indemnitor pursuant to the terms of Section 6.8(c) below, have the right to:
report the results of any testing to the appropriate Governmental Authorities if required by
an applicable Environmental Law; enter the property into a voluntary remediation or similar
program; take whatever steps are necessary to obtain a NFA Letter from the appropriate
Governmental Authorities or, in the event such Governmental Authorities do not provide a NFA
Letter in comparable situations or in the event they refuse to do so, comply with any
obligations of any Applicable Law, including any Environmental Law, in effect at the time;
and respond to any claim by any third party

47

 

with respect to any Intel Facility Environmental
Liability, provided that the Indemnitor’s duty to indemnify under Section 6.1 of the
Agreement for Intel Facility Environmental
Liabilities shall not apply to the extent that the Indemnitee’s actions fail to comply
with paragraph (b), below.

     (b) The Parties agree that any Remedial Action undertaken by Intel or Newco to obtain
any NFA Letter (to the extent permitted by the Governmental Authority issuing such NFA
Letter) or comply with any Applicable Law, including any Environmental Law, in effect at the
time: shall employ a reasonably cost-effective method under the circumstances, based on the
use of the property for industrial (as opposed to residential or commercial) purposes, shall
not exceed the least stringent requirement imposed by any clearly applicable Environmental
Laws in effect at the time, including as applicable, within the context of obtaining a NFA
Letter or complying with Applicable Law, shall make reasonable use of institutional and
engineering controls reasonably acceptable to both Newco and Intel, such as deed
restrictions, signs, fencing, buffers, and controls, to the extent permitted by Governmental
Authorities, provided that such institutional and engineering controls shall not (i)
unreasonably restrict or limit the industrial activities currently being performed and those
which Intel or Newco expects to perform on any Owned Intel Real Property or any Leased Intel
Real Property or associated services shared in any fashion between Intel and Newco, or (ii)
fail to address a material risk of off-site migration of any Hazardous Substances, and shall
take advantage of applicable risk assessment principles, where practicable, set forth in
applicable Environmental Laws in effect at the time.

     (c) After the Closing, on any Remedial Action that either Party undertakes pursuant to
the third sentence of Section 6.8(a), the acting Party shall:

     (i) cooperate with the other Party as much as possible, including, but not
limited to, keeping the other Party reasonably informed related to the progress of
such matters (including, providing the other Party with copies of material plans,
reports and external correspondence), permitting the other Party to be present at
the property during, and providing Intel reasonable advance notice prior to, the
execution of any significant Remedial Actions (including testing), and ensuring that
the other Party is provided reasonable advance notice of any scheduled voice or
in-person conferences with regulators or other third parties;

     (ii) ensure that such conferences are held on dates, and at places and times,
mutually convenient to the other Party, that the other Party is provided all
relevant information relating to such conferences, as and when generated or received
by the acting Party (but in all events reasonably far in advance of any conference
to permit the other Party’s informed participation therein), and that Intel and its
agents are afforded a reasonable opportunity to participate therein. The Parties
shall use reasonable efforts, including by making their respective agents available
on a mutually convenient basis, to work together on the strategy and conduct of such
conferences; and

48

 

     (iii) ensure that the other Party is given the opportunity to obtain duplicate
soil, groundwater and other samples if such samples are taken in connection with any
Remedial Action (including testing).

ARTICLE VII

MISCELLANEOUS

     7.1 Notices. All notices and other communications pursuant to this Agreement shall be
in writing and shall be deemed given if delivered personally, telecopied, sent by
nationally-recognized overnight courier or mailed by U.S. registered or certified mail (return
receipt requested), postage prepaid, to the Parties at the addresses set forth below or to such
other address as the Party to whom notice is to be given may have furnished to the other Party in
writing in accordance herewith. Any such notice or communication shall be deemed to have been
delivered and received (a) in the case of personal delivery, on the date of such delivery, (b) in
the case of telecopier, on the date sent if confirmation of receipt is received and such notice is
also promptly mailed by registered or certified mail (return receipt requested), (c) in the case of
a nationally-recognized overnight courier in circumstances under which such courier guarantees next
Business Day delivery, on the next Business Day after the date when sent and (d) in the case of
mailing, on the fifth Business Day following that on which the piece of mail containing such
communication is posted to the address provided herein or to such other address as the Person to
whom notice is given may have previously furnished to the others in writing in the manner set forth
above. Any Party hereto may give any notice, request, demand, claim or other communication
hereunder using any other means (including ordinary mail or electronic mail), but no such notice,
request, demand, claim or other communication shall be deemed to have been duly given unless and
until it actually is received by the individual for whom it is intended. Notices to Parties
pursuant to this Agreement shall be given:

if
to Intel, to:

Intel Corporation

2200 Mission College Boulevard

Santa Clara, CA 95054

Attention: Treasurer

Telephone: (408) 765-8080

Fax: (408) 765-6038

with a copy to:

Intel Corporation

2200 Mission College Boulevard

Santa Clara, CA 95054

Attention: General Counsel

Telephone: (408) 765-8080

Fax: (408) 653-8050

49

 

and a copy to (which shall not constitute notice to Intel):

Gibson, Dunn & Crutcher LLP

1881 Page Mill Rd.

Palo Alto, CA 94304

Attention: Russell C. Hansen

Telephone: (650) 849-5300

Fax: (650) 849-5333

if to Newco, to:

[Newco]

                                                            

                                                            

                                                            

Attention:

Telephone: (                    )                                          

Fax: (                    )                                          

with a copy to (which shall not constitute notice to Newco):

ST Microelectronics N.V.

Chemin du Champ-des-Filles, 39

1228 Plan-les-Ouates

Geneva, Switzerland

Attention: Pierre Ollivier, Group Vice President and General Counsel

Telephone: 41 22 929 58 76

Fax: 41 22 929 59 06

with copies to (which shall not constitute notice to Newco or ST)

ST Microelectronics N.V.

1310 Electronics Drive

Mail Station

Carollton, TX 75006

Attention: Steven K. Rose, Vice President, Secretary and General Counsel

Telephone: (972) 466-6412

Fax: (972) 466-7044

Shearman & Sterling LLP

525 Market Street

San Francisco, CA 94105

Attention: John D. Wilson

Telephone: (415) 616-1100

Facsimile: (415) 616-1199

50

 

with copies to (which shall not constitute notice to Newco)

Francisco Partners

2882 Sand Hill Road

Suite 289

Menlo Park, CA 94025

Attention: David ibnAle

Telephone: (650) 233-2900

Fax: (650) 233-2999

Francisco Partners

40 Berkeley Square

London W1J 5AL

United Kingdom

Attention: Phokion Potamianos

Telephone: 44 0 207 907 8600

Fax: 44 0 207 907 8650

with a copy to (which shall not constitute notice to Newco or FP)

Davis Polk & Wardwell

1600 El Camino Real

Menlo Park, CA 94025

Attention: William M. Kelly

                  Martin A. Wellington

Telephone: (650) 752-2000

Facsimile: (650) 752-2112

     7.2 Amendments; Waivers.

     (a) Any provision of this Agreement may be amended or waived if, and only if, such
amendment or waiver is in writing and signed, in the case of an amendment, by all Parties,
or in the case of a waiver, by the Party against whom the waiver is to be effective.

     (b) No waiver by a Party of any default, misrepresentation or breach of a warranty or
covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or
subsequent default, misrepresentation or breach of a warranty or covenant hereunder or
affect in any way any rights arising by virtue of any prior or subsequent occurrence. No
failure or delay by a Party hereto in exercising any right, power or privilege hereunder
shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be cumulative and not exclusive of
any rights or remedies provided under Applicable Law.

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     7.3 Expenses. Except as set forth in Section 5.8(c) hereof and Section
7.3 of the Master Agreement, all costs and expenses incurred in connection with this Agreement
and the other Transaction Documents and in closing and carrying out the transactions contemplated
hereby and thereby shall be paid by the Party incurring such cost or expense.

     7.4 Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the Parties and their respective successors, heirs, personal representatives and
permitted assigns. No Party hereto may transfer or assign either this Agreement or any of its
rights, interests or obligations hereunder, whether directly or indirectly, by operation of law,
merger or otherwise, without the prior written approval of each other Party; provided, however,
that Newco may assign, delegate or transfer in whole or in part its rights and interests under this
Agreement and the Transaction Documents to any of its lenders for collateral assignment purposes.
No such transfer or assignment shall relieve the transferring or assigning Party of its obligations
hereunder if such transferee or assignee does not perform such obligations.

     7.5 Governing Law. This Agreement shall be construed in accordance with and this
Agreement and any disputes or controversies related hereto shall be governed by the internal laws
of the State of New York without giving effect to the conflicts of laws principles thereof that
would apply the laws of any other jurisdiction.

     7.6 Counterparts; Effectiveness. This Agreement may be signed in any number of
counterparts and the signatures delivered by telecopy, each of which shall be an original, with the
same effect as if the signatures were upon the same instrument and delivered in person. This
Agreement shall become effective when each Party hereto shall have received a counterpart hereof
signed by the other Parties.

     7.7 Entire Agreement. This Agreement (including the schedules and exhibits referred
to herein, which are hereby incorporated by reference), the other Transaction Documents and the
Confidentiality Agreement constitute the entire agreement between the Parties with respect to the
subject matter hereof and thereof and supersede all prior agreements, understandings and
negotiations, both written and oral, express or implied, between and among the Parties with respect
to the subject matter of this Agreement. No representation, warranty, promise, inducement or
statement of intention has been made by either Party that is not embodied in this Agreement or such
other documents, and neither Party shall be bound by, or be liable for, any alleged representation,
warranty, promise, inducement or statement of intention not embodied herein or therein.

     7.8 Captions. The captions herein are included for convenience of reference only and
shall be ignored in the construction or interpretation hereof.

     7.9 Severability. If any provision of this Agreement, or the application thereof to
any Person, place or circumstance, shall be held by a court of competent jurisdiction to be
invalid, unenforceable or void, the remainder of this Agreement and such provisions as applied to
other Persons, places and circumstances shall
remain in full force and effect only if, after excluding the portion deemed to be
unenforceable, the remaining terms shall provide for the consummation of the transactions
contemplated hereby in substantially the same manner as originally set forth at the later of the
date this Agreement was executed or last amended.

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     7.10 Dispute Resolution.

     (a) With the exception of disputes involving intellectual property ownership and
infringement issues, and disputes governed by Section 2.7, Section 2.8,
Section 2.9 or Section 5.8(g) hereof, any dispute arising under this
Agreement shall be finally resolved by arbitration. The Parties waive their right to any
form of appeal to a court on any questions of law arising out of the arbitration award. Any
dispute or claim between the Parties which is beyond the scope of this Section shall be
submitted to the exclusive jurisdiction of the courts of the State of New York and the
Federal courts of the United States of America located in the State of New York. The Parties
hereby consent to and grant any such court jurisdiction over such Parties and over the
subject matter of such dispute and agree that mailing of process or other papers in
connection with any such action or proceeding in the manner provided in Section 7.1
or in such other manner as may be permitted by Applicable Law, shall be valid and sufficient
service thereof.

     (b) Mediation. Prior to arbitration, however, the Party making the original
claim shall provide the other Party with a written description of the dispute or claim and
the senior executives of the Parties shall meet in an attempt to resolve such dispute or
claim. If the disagreements cannot be resolved by the senior management after 90 days from
the date any Party made a written demand for resolution, a binding arbitration shall be
held.

     (c) Arbitration Rules. The rules of the arbitration shall be agreed upon by
the Parties prior to the arbitration and shall be based upon the nature of the disagreement.
To the extent that the Parties cannot agree on the rules of the arbitration after 30 days
from the date any party makes a written demand for resolution, then, subject to Section
7.10(d), the Rules of Arbitration of the ICC in effect as of the Closing Date shall
apply.

     (d) Mandatory Rules. As a minimum set of rules in the arbitration the Parties
agree as follows:

     (i) The arbitration shall be held by one arbitrator appointed by mutual
agreement of the Parties. If the Parties cannot agree on a single arbitrator within
15 days from the date written demand for arbitration has been received by the other
Party, each Party shall identify one independent individual. The individuals
appointed by the Parties shall then meet to appoint a single arbitrator. If an
arbitrator still cannot be agreed upon within an additional 15 day period, he or she
shall be appointed by the ICC.

     (ii) The place of arbitration shall be New York, New York. Hearings and
meetings shall be held in New York or at such other place as the Parties may agree.

     (iii) The English language shall be used in the proceedings. Documents and
written testimonies may be submitted in any language provided that the Party
submitting such documents and testimonies shall provide, at its own expense, a
translation of the same in the English language.

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     (iv) The arbitrator shall specify the basis for the award, the basis for the
damages award and a breakdown of the damages awarded, and the basis of any other
remedy authorized under this section. The award shall be considered as a final and
binding resolution of the dispute or claim.

     (v) The Parties agree to maintain the confidentiality of the arbitral
proceedings, the existence of the same and the status of the hearings. In addition,
the Parties undertake to maintain the confidentiality of any document exchanged in,
produced in, or created by the Parties for the arbitration proceedings as well as
the confidentiality of the award. Notwithstanding the foregoing, if the disclosure
of the arbitral proceedings, or of any of the documents exchanged in, produced in or
created for the arbitration proceedings or if the disclosure of the award is
required by applicable law, rule or regulation or is compelled by a court or
governmental agency, authority or body: (A) the Parties shall use the legitimate and
legal means available to minimize the scope of their disclosure to third parties;
and (B) the Party compelled to make the disclosure shall inform the other Party and
the arbitrator at least 20 Business Days in advance of the disclosure (or if 20
Business Days’ notice is not practicable because the Party is required to make the
disclosure less than 20 Business Days after becoming aware of the event or
occurrence giving rise to such disclosure requirement, then notice to the other
Party and the arbitrator shall be provided as soon as practicable after such event
or occurrence).

     (vi) The duty of the Parties to arbitrate any dispute or claim within the scope
of this Section shall survive the expiration or termination of this Agreement for
any reason. The Parties specifically agree that any action must be brought, if at
all, within two years from discovery of the cause of action.

     (vii) The discretion of the arbitrator to fashion remedies shall be no broader
than the legal and equitable remedies available to a court (unless the parties
expressly agree otherwise prior to the start of arbitration). In no event, however,
shall the arbitrator award a remedy which enjoins a Party or its customers to stop
manufacturing, using, marketing, selling, offering for sale, or importing such
Party’s products. In addition, notwithstanding anything herein to the contrary, in
no event, shall the arbitrator award a remedy which enjoins a Party to license to
the other Party any of its intellectual property rights of whatever nature. The
arbitrator will have no authority to award damages in excess of compensatory damages
and each Party expressly waives and foregoes any right to punitive, exemplary or
similar damages, except as such damages may be required by statute. In no event
shall the amount of damages awarded to the prevailing Party exceed or otherwise be
inconsistent with any of the applicable
limitations on damages set forth in this Agreement, including Sections
6.2 and 6.5.

     (viii) The arbitrator may not order any conservatory or interim relief measures
of any kind. In any event, however, either Party may apply for conservatory or
interim relief measures to the courts of the State of New York or

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the Federal courts
of the United States of America located in the State of New York which shall have
exclusive jurisdiction to grant such injunctive relief.

     (ix) The Parties shall agree upon what, if any, disclosure to the other parties
to the arbitration shall be permitted. If the Parties can not agree on the form of
disclosure within 30 days after the appointment of the arbitrator, then the Parties
agree that in addition to the Rules of Arbitration of the ICC, the arbitrators shall
apply the IBA Rules of Evidence. In case of conflict between Rules of Arbitration of
the ICC and the IBA Rules of evidence, the Rules of Arbitration of the ICC shall
prevail. Notwithstanding anything herein to the contrary, in no event shall anything
verbally or in writing used strictly for settlement purposes between the Parties be
permitted by the arbitration to be used as evidence for either Party’s case.

     (x) The Parties shall equally bear the costs of the arbitration. Each Party
shall bear the fees and expenses of its appointed experts and shall bear its own
legal expenses. For the purpose of this clause, the term “costs of arbitration”
includes only: (A) the fees and expenses of the arbitrator; (B) in the case of an
arbitration governed by the ICC Rules, the ICC administrative expenses fixed by the
Court of Arbitration of the ICC; and (C) the fees and expenses of any experts
appointed by the arbitrator.

     7.11 Waiver of Jury Trial. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND
THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY
HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY
CERTIFIES AND ACKNOWLEDGES THAT (a) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
SEEK TO ENFORCE THE FOREGOING WAIVER, (b) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE
IMPLICATIONS OF THIS WAIVER, (c) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (d) EACH SUCH
PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE WAIVERS AND
CERTIFICATIONS IN THIS SECTION 7.11.

     7.12 Third Party Beneficiaries. Notwithstanding any other provision in this Agreement
to the contrary, neither ST nor FP shall
be deemed to be a third party beneficiary under this Agreement for any purpose. No provision
of this Agreement shall create any third party beneficiary rights in any other Person, including
any employee or former employee of Intel or ST or any of their respective Affiliates (including any
beneficiary or dependent thereof).

     7.13 Specific Performance. The Parties hereby acknowledge and agree that the failure
of any Party to perform its agreements and covenants hereunder, including its failure to take all
actions as are necessary on its part to the consummation of the transactions contemplated herein,

55

 

may cause irreparable injury to the other Party, for which damages, even if available, may not be
an adequate remedy. Accordingly, each Party hereby consents to the issuance of injunctive relief
by any court of competent jurisdiction to compel performance of such Party’s obligations and to the
granting by any court of the remedy of specific performance of its obligations hereunder.

     7.14 No Presumption Against Drafting Party. Intel and Newco acknowledge that Intel
and each of the other shareholders of Newco have been represented by counsel in connection with the
negotiation and execution of this Agreement and the other Transaction Documents. Accordingly, any
rule of law or any legal decision that would require interpretation of any claimed ambiguities in
this Agreement against the drafting party has no application and is expressly waived.

[Remainder of page intentionally left blank]

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     IN WITNESS WHEREOF, the Parties hereto have caused this Intel Asset Transfer Agreement to be
duly executed and delivered as of the date set forth above.

	 	 	 	 	 	 	 
	 	 	INTEL CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Date:	 	 	 	 
	 

	 	 	 	 

	 	 
	 
	 	 	 	 	 	 
	 	 	[NEWCO]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Date:	 	 	 	 
	 

	 	 	 	 

	 	 

[Signature Page to Intel Asset Transfer Agreement]

 

 

			
	 	 	 
	APPENDIX A
	 	 

INTEL ASSET TRANSFER AGREEMENT

DEFINITIONS

     “Accounts Payable” means all accounts payable owing by a Person for raw materials or
supplies received by or services rendered to such Party or any of its Subsidiaries.

     “Accounts Receivable” means all accounts receivable, notes receivable and other
current rights to payment of a Person, together with any unpaid interest or fees accrued thereon or
other amounts due with respect thereto, and any claim, remedy or other right related to any of the
foregoing.

     “Actual Intel Capital Expenditures” shall have the meaning set forth in Section
2.9 of the Intel Asset Transfer Agreement.

     “Affiliate”, with respect to any Person, means any other Person directly or indirectly
controlling, controlled by or under common control with, such Person. For purposes of this
definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled
by” or “under common control with”), as used with respect to any Person, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities or by contract or
otherwise.

     “Applicable Law” means, with respect to any Person, any federal, state, local or
foreign statute, law, ordinance, rule, administrative interpretation, regulation, order, writ,
injunction, directive, judgment, decree or other requirement of any Governmental Authority
applicable to such Person or any of its Affiliates or any of their respective properties, assets,
officers, directors, employees, consultants or agents.

     “Articles of Association” means the Articles of Association of Newco, in substantially
the form attached to Schedule 2.4 of both of the Master Agreement Disclosure Letters, as
amended from time to time.

     “Business Day” means each day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York or Geneva, Switzerland are authorized or required by law to
close.

     “Cash and Cash Equivalents” means all cash on hand and cash equivalents of a Person
(whether or not related to the applicable Business), including currency and coins, negotiable
checks, bank accounts, marketable securities, commercial paper, certificates of deposit, treasury
bills, surety bonds and money market funds.

     “Claims” means all rights to causes of action, claims, demands, rights and privileges
against third parties, whether liquidated or unliquidated, fixed or contingent, choate or inchoate.

APPENDIX A

 

 

     “Closing” shall have the meaning set forth in Section 2.5 of the Master
Agreement.

     “Closing Date” means the date of the Closing, as further described in Section
2.5 of the Master Agreement.

     “Confidentiality Agreement” means that certain Confidentiality Agreement among Intel,
ST and FP dated as of May 22, 2007.

     “Contemplated Financing” means either of: (i) the debt financing pursuant to the
Commitment Letter; or (ii) substitute debt financing on substantially equivalent economic terms
that is adequate to provide working capital requirements and funds for other general corporate
purposes of Newco and its Subsidiaries following the Closing.

     “Contract” means each contract, agreement, option, lease, license, cross-license, sale
and purchase order, commitment and other instrument of any kind, whether written or oral.

     “Copyrights” means copyrights and mask work rights (whether or not registered) and
registrations and applications therefor, worldwide.

     “Customer Data” means the data related to customers of a Party’s Business which is
included in such Party’s Transferred Assets.

     “D2 Equipment” means the machinery, laboratory and other equipment, tools and other
tangible personal property set forth under the heading “D2” in Schedule 2.1(a) to the Intel
ATA Disclosure Letter.

     “Effective Time” means, unless otherwise agreed by the Parties, 12:01 a.m. GMT on the
Closing Date.

     “Environmental Laws” means any Applicable Laws of any Governmental Authority in effect
as of the Closing Date, unless otherwise noted, relating to pollution, protection or remediation of
the environment, the use, storage, treatment, generation, manufacture, distribution,
transportation, processing, handling, Release, disposal of or exposure to Hazardous Substances or,
as such relate to Hazardous Substances, public and occupational health and safety.

     “Environmental Liability” means any Liability or Loss, including the cost of any
Remedial Action, arising in connection with (i) the use, generation, storage, treatment,
manufacture, distribution, transportation, processing, handling, disposal or Release of any
Hazardous Substances, (ii) the violation of or liability under any Environmental Laws or any
Governmental Approval relating to any Hazardous Substances or (iii) any third party claim,
litigation or proceeding relating to any Hazardous Substance or Environmental Laws.

     “Environmental Permits” means all permits, licenses or other authorizations of any
Governmental Authority required pursuant to applicable Environmental Law.

     “Equity Plan” means an equity compensation plan for Newco, with terms reasonably
satisfactory to Newco, Intel, ST, and FP, pursuant to which no more than 6% of the outstanding
share capital of Newco at the Closing Date shall be reserved for issuance.

59

 

     “Equity Transaction Documents” means the Share Purchase Agreement, the Shareholders’
Agreement, the Articles of Association and the Internal Rules.

     “Final Payment Date” has the meaning set forth in Section 2.8 of the Intel
Asset Transfer Agreement.

     “FP” means Redwood Blocker S.a.r.l., a limited liability company organized under the
laws of The Grand-Duchy of Luxembourg.

     “GAAP” means generally accepted accounting principles in the United States of America,
applied on a consistent basis, as in effect as of the date hereof.

     “Governmental Approval” means an authorization, consent, approval, permit or license
issued by, or a registration or filing with, or notice to, or waiver from, any Governmental
Authority.

     “Governmental Authority” means any United States or non-United States federal,
territorial, state or local governmental authority, quasi-governmental authority, instrumentality,
court, government or self-regulatory organization, commission, tribunal or organization or any
regulatory, administrative or other agency, or any political or other subdivision, department or
branch of any of the foregoing.

     “Hazardous Substance” shall mean any hazardous substance within the meaning of Section
101(14) of the United States Comprehensive Environmental Response, Compensation and Liability Act
of 1980, 42 U.S.C. § 9601(14), and any chemical, substance, material, agent or waste defined or
regulated as toxic, hazardous, extremely hazardous or radioactive, or as a pollutant or
contaminant, under any applicable Environmental Law, including petroleum, petroleum derivatives,
petroleum by-products or other hydrocarbons, asbestos or asbestos-containing material and
polychlorinated biphenyls.

     “Indebtedness” means any (i) indebtedness for borrowed money, (ii) indebtedness
evidenced by any bond, debenture, note, mortgage, indenture or other debt instrument or debt
security, or (iii) guarantees with respect to any indebtedness or obligation of a type described in
clauses (i) through (ii) above of any other Person.

     “Indemnitee” shall (i) for purposes of the Intel Asset Transfer Agreement, have the
meaning set forth in Section 6.2(c) of the Intel Asset Transfer Agreement, and (ii) for
purposes of the ST Asset Contribution Agreement, have the meaning set forth in Section
6.2(c) of the ST Asset Contribution Agreement.

     “Indemnitor” shall (i) for purposes of the Intel Asset Transfer Agreement, have the
meaning set forth in Section 6.2(c) of the Intel Asset Transfer Agreement, and (ii) for
purposes of the ST Asset Contribution Agreement, have the meaning set forth in Section
6.2(c) of the ST Asset Contribution Agreement.

     “Independent Accountants” shall have the meaning set forth in Section 2.7(c)
of the Intel Asset Transfer Agreement.

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     “Intel Actuary” shall have the meaning set forth in Section 5.11(c) of the
Intel Asset Transfer Agreement.

     “Intel Ancillary Agreements” means the Intel Assignment and Assumption Agreement,
Intel Bills of Sale, Intel Intellectual Property Agreement, Intel Transition Services Agreements,
Intel Facility Transfer Agreements, Intel Joint Development Agreement, Intel Supply Agreement,
Intel Assumption of Excluded Liabilities, Intel Copyright Assignment, Intel Patent Assignment and
Intel Trademark Assignment.

     “Intel Approvals” means the required consents, waivers and approvals of Intel set
forth on Schedule 3.3 of the Intel ATA Disclosure Letter and Schedule 3.1(c) of the
Intel Master Agreement Disclosure Letter.

     “Intel Assignment and Assumption Agreement” means, collectively, the Assignment and
Assumption Agreements to be entered into by Newco or its Affiliates, on one hand, and Intel or its
Affiliates, on the other hand, as of the Closing Date, in substantially the form attached as
Exhibit A to the Intel Asset Transfer Agreement.

     “Intel Assumption of Excluded Liabilities” shall have the meaning set forth in
Section 2.4 of the Intel Asset Transfer Agreement.

     “Intel ATA Disclosure Letter” means the disclosure letter, as agreed to between the
Parties as of the date of the Master Agreement (with such amendments or new schedules as may be
subsequently made pursuant to Section 4.12 of the Master Agreement), containing the
Schedules required by the provisions of such agreement.

     “Intel ATA Restricted Employees” shall have the meaning set forth in Section
5.11(e)(ii) of the Intel Asset Transfer Agreement.

     “Intel Bill of Sale” means any bill of sale or other similar document reasonably
requested by any Party and reasonably necessary to transfer any Intel Transferred Asset in
accordance with applicable law to be executed by one or more Intel Transferors in favor of Newco or
a Subsidiary of Newco as of the Closing Date, each in substantially the form attached as
Exhibit B to the Intel Asset Transfer Agreement.

     “Intel Books and Records” means all of the books of account, general and financial
records, invoices, shipping records, customer records, supplier lists, correspondence and other
documents, records and files of Intel and its Subsidiaries whether in hard copy or computer format
which relate exclusively to the Intel Business and are necessary for the conduct of such Intel
Business after the Closing (excluding all personnel records or any employee information for Intel
Business Employees who are not Intel Transferred Employees employed by an Intel Transferred Entity
as of the Closing Date).

     “Intel Business” means the sale, manufacture, design and or development of NOR Flash
Memory Products, Phase Change Memory technology (subject to Schedule 2.2(o) to the Intel
ATA Disclosure Letter), and Stacked Memory Products.

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     “Intel Business Capital Expenditures Plan” means the plan set forth on Schedule
3.14(e) of the Intel ATA Disclosure Letter setting forth (i) the actual capital expenditures of
Intel with respect to the Intel Business for its first fiscal quarter of 2007; and (ii) the
budgeted capital expenditures of Intel with respect to the Intel Business for the second, third and
fourth fiscal quarters of 2007.

     “Intel Business Employees” means the employees who are identified on Schedule
3.12(c) of the Intel ATA Disclosure Letter.

     “Intel Cash Independent Accountants” has the meaning set forth in Section 2.8
of the Intel Asset Transfer Agreement.

     “Intel Consideration” shall have the meaning set forth in Section 2.6(c) of
the Intel Asset Transfer Agreement.

     “Intel Contractual Consents” shall have the meaning set forth in Section
3.8(b) of the Intel Asset Transfer Agreement.

     “Intel Copyright Assignment” means any agreement for the assignment of Intel
Transferred Copyrights by an Intel Transferor to Newco or a Subsidiary of Newco, dated as of the
Closing Date, in the form agreed among Intel, ST and FP.

     “Intel Employee Agreement” means each management, employment, severance, consulting,
relocation, repatriation, expatriation or other agreement or Contract between Intel or any of its
Subsidiaries and any Intel Business Employee directly relating to such Intel Business Employee’s
terms or conditions of employment.

     “Intel Employee Plan” means any plan, program, policy, practice, agreement or other
arrangement providing for compensation, severance, termination pay, vacation pay, paid time off,
pension benefits, retirement benefits, deferred compensation, variable compensation, bonuses,
performance awards, stock or stock-related awards, fringe benefits (including health, dental,
vision, life, disability, sabbatical, accidental death and dismemberment benefits), or other
employee benefits or remuneration of any kind, whether written, unwritten or otherwise, funded or
unfunded, including each “employee benefit plan,” within the meaning of Section 3(3) of ERISA,
excluding any Intel Employee Agreement, which is or has been maintained or contributed to by Intel
or its Affiliates for the benefit of any Intel Business Employee.

     “Intel Equipment” means (i) the machinery, laboratory and other equipment, tools and
other tangible personal property set forth on Schedule 2.1(a) of the Intel ATA Disclosure
Letter and (ii) each item of machinery, laboratory and other equipment, tools and other tangible
personal property with a gross book value of less than $10,000 that is exclusively related to the
Intel Business and located at the Intel Transferred Facilities.

     “Intel Excluded Assets” shall have the meaning set forth in Section 2.2 of the
Intel Asset Transfer Agreement.

     “Intel Excluded Claims” means all Claims to the extent that such claims relate to: (i)
any Intel Excluded Assets; or (ii) events or breaches occurring on or prior to the Closing Date
that

62

 

relate to the Intel Transferred Assets, provided that Claims for infringements of any Intel
Transferred Patents, Intel Transferred Copyrights or Intel Transferred Trade Secrets occurring on
or prior to the Closing Date shall not be Intel Excluded Claims.

     “Intel Excluded Liabilities” shall have the meaning set forth in Section 2.4
of the Intel Asset Transfer Agreement.

     “Intel Facility Environmental Liability” shall mean all Intel Pre-Closing
Environmental Liabilities relating to the condition of the soil, soil gas, surface water (including
sediments) or groundwater, with respect to the existence of any Hazardous Substances therein, at,
on, or under the Owned Intel Real Property or the Leased Intel Real Property.

     “Intel Facility Transfer Agreements” means the Intel Facility Transfer Agreements to
be entered into by and between Intel and Newco on the Closing Date, based on the terms and
conditions set forth in the Intel Facility Transfer Term Sheets.

     “Intel Financial Information” shall have the meaning set forth in Section
3.13(a) of the Intel Asset Transfer Agreement.

     “Intel Financial Information Date” shall have the meaning set forth in Section
3.13(a) of the Intel Asset Transfer Agreement.

     “Intel Funded Employee Plan” means any Intel Employee Plan that is funded other than
through book reserves or insurance and that is not subject to the laws of the United States.

     “Intel Funded Employee Plan Amount” shall have the meaning set forth in Section
5.11(c) of the Intel Asset Transfer Agreement.

     “Intel Indemnitees” means Intel and its Affiliates, officers, directors, stockholders,
representatives and agents.

     “Intel Intellectual Property Agreement” means the Intellectual Property Agreement to
be entered into by and between Intel and Newco on the Closing Date, in substantially the form
attached to Schedule 2.1 of the Intel Master Agreement Disclosure Letter.

     “Intel Inventory Value” means, as of any date of determination, the gross book value
of the Intel Transferred Inventory as of such date (less (x) reserves and (y) any amount in respect
of depreciation allocated to the Intel Transferred Inventory) as determined as of such date (1)
from the books and records of Intel maintained in the ordinary course of business and (2) in
accordance with GAAP, applied in a manner consistent with the Intel Financial Information (as it
may be adjusted by Intel in its sole discretion to reflect any changes consistent with the audited
financial statements of the Intel Business to be delivered under this Agreement at and for the year
ended December 31, 2006). Intel Inventory Value shall be determined without giving effect to the
transactions contemplated by this Agreement. For purposes of this definition, the amount of
reserves deducted under clause (x) above shall be determined as of such date (1) from the books and
records of Intel maintained in the ordinary course of business and (2) in accordance with GAAP,
applied in a manner consistent with the Intel Financial Information (as adjusted above). The Intel
Inventory Value at the end of the first fiscal quarter of Intel and the Intel

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Inventory Value at the Closing Date shall be determined on a consistent basis in all respects.
Notwithstanding the foregoing, no amount shall be included in the Intel Inventory Value with
respect to:

(i) inventories of any Intel Product which, as of such date, is obsolete; or

(ii) any units in inventory of any Intel Product which as of such date (A) are not
first quality, (B) are not free from defects or (C) do not meet all applicable
customer specifications.

     “Intel Joint Development Agreement” means the Joint Development Agreement by and
between Intel and Newco to be entered into on the Closing Date, in substantially the form attached
to the Schedule 2.1 of the Intel Master Agreement Disclosure Letter.

     “Intel Leases” means all leases or other occupancy agreements pursuant to which Intel
or its Subsidiaries lease or occupy the Leased Intel Real Property.

     “Intel Material Adverse Effect” means any event, change or circumstance that,
individually or in the aggregate with all other such events, changes or circumstances, (i) results
in a material adverse effect on, or material adverse change in, the Intel Transferred Assets, taken
as a whole, or (ii) any event, change or circumstance that is materially adverse to the ability of
Intel to perform its obligations under any Transaction Document to which it is or will be a party
or to consummate the transactions contemplated thereby, other than, in the case of clause (i)
above, such changes, effects or circumstances reasonably attributable to: (A) economic, capital
market or political conditions generally in the United States or foreign economies in any locations
where the Intel Business has material operations or sales, provided the changes, effects or
circumstances do not have a materially disproportionate effect (relative to other industry
participants) on the Intel Business, (B) conditions generally affecting the industry in which the
Intel Business operates, provided that the changes, effects or circumstances do not have a
materially disproportionate effect (relative to other industry participants) on the Intel Business;
(C) the announcement or pendency of the transactions contemplated by the Transaction Documents; (D)
outbreak of hostilities or war, acts of terrorism or acts of God; or (E) compliance with Intel’s
obligations or the satisfaction of the conditions to the closing of the transactions contemplated
by the Transaction Documents.

     “Intel Newco Shares” shall have the meaning set forth in Section 2.6(a) of the
Intel Asset Transfer Agreement.

     “Intel Notice of Disagreement” shall have the meaning set forth in Section
2.7(b) of the Intel Asset Transfer Agreement.

     “Intel Option” means that certain Option to Purchase Ordinary Shares to be entered
into between Newco and Intel or one or more of Intel’s Affiliate(s), in substantially the form
attached to Schedule 4.16(d) of the Intel Master Agreement Disclosure Letter.

     “Intel Option Shares” shall have the meaning set forth in Section 2.6(a) of
the Intel Asset Transfer Agreement.

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     “Intel Patent Assignment” means any agreement for the assignment of Intel Transferred
Patents by an Intel Transferor to Newco or a Subsidiary of Newco, dated as of the Closing Date, in
the form agreed among Intel, ST and FP.

     “Intel Post-Closing Environmental Liability” shall mean any Environmental Liability,
including a worsening of existing conditions, to the extent arising out of or relating to (i)
Newco’s acts occurring after the Closing Date, (ii) Newco’s inaction occurring one year or later
after the Closing Date, or (iii) Newco’s inaction occurring within one year after the Closing Date
if Newco knew about the existing condition and its inaction worsened the existing condition; and in
connection with a Newco Business or the Intel Business, the Owned Intel Real Property, the Leased
Intel Real Property, the Intel Transferred Assets or the Intel Transferred Entities or the
ownership or operation of a Newco Business or the Intel Business, the Owned Intel Real Property,
the Leased Intel Real Property or the Intel Transferred Assets, the Intel Transferred Entities by,
or the disposal or treatment of Hazardous Substances generated by, Newco or an Affiliate of Newco
(including an Intel Transferred Entity) after the Closing Date.

     “Intel Post-Closing Product Obligations” means (i) all obligations arising in respect
of product support or maintenance obligations related to Intel Products sold or licensed on or
after the Closing and required to be performed after the Closing, which obligations arise under any
Intel Transferred Contract, and any Liabilities which may arise in connection with the performance
of, or failure to perform, those obligations and (ii) Liabilities relating to any product
liability, warranty, refund or similar claims or returns, adjustments, allowances, repairs made
with respect to Intel Products sold after the Closing Date, including those sold by Intel on behalf
of Newco after the Closing pursuant to the Intel Transition Services Agreements.

     “Intel Pre-Closing Environmental Liability” shall mean any Environmental Liability
which (i) relates to the ownership or operation of the Intel Business (as now or previously
conducted), the Owned Intel Real Property, the Leased Intel Real Property, the Intel Transferred
Assets, the Intel Transferred Entities, the Intel Shared Facilities or any other real property or
facility owned, leased, operated or used in connection with the Intel Business (as now or
previously conducted) or for the disposal or treatment of Hazardous Substances generated in
connection with the Intel Business, the Owned Intel Real Property, the Leased Intel Real Property,
the Intel Transferred Assets, or the Intel Transferred Entities, (ii) arises out of or relates to
acts occurring or conditions existing on or prior to the Closing Date, but only to the extent that
the Environmental Liability arising out of or relating to acts occurring or conditions existing on
or prior to the Closing Date can be identified from (A) the Intel Environmental Reports so long as
such reports are issued not later than one year subsequent to the Closing or (B) documents or data
generated prior to the Closing and in the possession of Intel prior to the Closing, and (iii) is
identified in the foregoing documents and/or data with sufficient specificity so as to clearly
identify the scope of the Environmental Liability that is attributable to the Intel Business, the
Owned Intel Real Property, the Leased Intel Real Property, the Intel Transferred Assets, or the
Intel Transferred Entities. Notwithstanding the foregoing, Intel Pre-Closing Environmental
Liability shall not include any Intel Post-Closing Environmental Liability.

     “Intel Pre-Closing Product Obligations” means (i) all obligations arising in respect
of product support or maintenance obligations related to Intel Products sold or licensed prior to
the Closing and required to be performed after Closing, which obligations arise under any Intel

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Transferred Contract, and any Liabilities which may arise in connection with the performance
of, or failure to perform, those obligations and (ii) Liabilities relating to any product
liability, warranty, refund or similar claims or returns, adjustments, allowances, repairs, or
commercial accommodations or arrangements in respect of Epidemic Failures made with respect to
Intel Products sold on or before the Closing Date.

     “Intel Preliminary Closing Statement” has the meaning set forth in Section 2.8
of the Intel Asset Transfer Agreement.

     “Intel Prepayments” means all Prepayments of Intel or any of its Subsidiaries (a)
associated with the Intel Transferred Contracts and (b) set forth on Schedule 2.1(f) to the
Intel ATA Disclosure Letter.

     “Intel Privacy Policy” shall have the meaning set forth in Section 5.12 of the
Intel Asset Transfer Agreement.

     “Intel Products” means all NOR Flash Memory Products and all Stacked Memory Products,
manufactured, sold, or under development by Intel as of the Effective Date including those listed
on Schedule 1.1(c) of the Intel ATA Disclosure Letter.

     “Intel Retained Marks” shall have the meaning set forth in Section 5.3 of the
Intel Asset Transfer Agreement.

     “Intel Standard Form Product Warranties” shall have the meaning set forth in
Section 3.16 of the Intel Asset Transfer Agreement.

     “Intel Supply Agreement” means the Supply Agreement identified on Schedule 2.1
of both of the Master Agreement Disclosure Letters to be entered into by and between Intel and
Newco on the Closing Date, in substantially the form attached to such schedule.

     “Intel Tax Agreement” shall have the meaning set forth in Section 3.10(e) of
the Intel Asset Transfer Agreement.

     “Intel Trademark Assignment” means any agreement for the assignment of Intel
Transferred Trademarks by an ST Transferor to Newco or a Subsidiary of Newco, dated as of the
Closing Date, in the form agreed among Intel, ST and FP.

     “Intel Transferors” shall have the meaning set forth in the Recitals of the Intel
Asset Transfer Agreement.

     “Intel Transferors” shall have the meaning set forth in the Recitals of the Intel
Asset Transfer Agreement.

     “Intel Transferred Assets” shall have the meaning set forth in Section 2.1 of
the Intel Asset Transfer Agreement.

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     “Intel Transferred Claims” means all Claims to the extent such Claims relate to the
Intel Transferred Assets or the Intel Transferred Liabilities, other than the Intel Excluded
Claims. For avoidance of doubt, Intel Transferred Claims shall include claims for infringement of
any Intel Transferred Patent, Intel Transferred Copyright or Intel Transferred Trade Secret
occurring on or prior to the Closing Date.

     “Intel Transferred Contracts” means all unexpired contracts set forth on Schedule
2.1(e) of the Intel ATA Disclosure Letter, together with the Intel Transferred Purchase Orders,
the Intel Transferred Sales Orders and the Intel Leases.

     “Intel Transferred Copyrights” means the Copyrights identified on Schedule
2.1(i) of the Intel ATA Disclosure Letter.

     “Intel Transferred Employee Payment Liabilities” means any and all payment obligations
of Intel and its Affiliates (i) relating to the service of Intel Transferred Employees prior to the
Effective Time, (ii) that are assumed by Newco by operation of Applicable Law at the Effective
Time, (iii) that are unfunded or for which accruals are made on the employing company’s balance
sheet (or which would be required to be made on a balance sheet prepared in accordance with GAAP,
consistently applied), and (iv) that are not otherwise paid out or satisfied to the Intel
Transferred Employees prior to or at the Effective Time, including retirement benefits, termination
indemnities, unemployment, accrued vacation and paid-time off benefits, Christmas bonuses,
thirteenth-month bonuses, vacation premium bonuses and any other non-incentive cash bonuses (other
than salary), jubilee and long-service payments; provided, however, that Intel Transferred Employee
Payment Liabilities shall not include (x) any contingent Liabilities on the part of Newco that
arise solely as a result of providing service recognition under Section 5.11(a) of the
Intel Asset Transfer Agreement, (y) any unearned incentive bonuses or variable pay and (z) the
regular payroll of the Intel Transferred Entities as of the Effective Time.

     “Intel Transferred Employees” means the Intel Business Employees who accept an offer
of employment from Newco and who begin their employment with Newco at the Closing (or, to the
extent permitted by Applicable Law with respect to inactive employees on short-term, medical or
other leave of absence, at the time such employee returns to active status) or such other date as
the parties may reasonably agree.

     “Intel Transferred Entities” means the entities set forth on Schedule 1.1(a)
of the Intel ATA Disclosure Letter.

     “Intel Transferred Entity Books and Records” means the minute books, stock records,
Tax Returns and other records related to Taxes, if any, in each case of each of the Intel
Transferred Entities

     “Intel Transferred Intellectual Property” means, collectively, the Intel Transferred
Copyrights, Intel Transferred Patents, Intel Transferred Trademarks and Intel Transferred Trade
Secrets.

     “Intel Transferred Interests” means 100% of the outstanding equity, voting and profit
interests in the Intel Transferred Entities.

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     “Intel Transferred Inventory” means all raw materials, work-in-process, finished
goods, supplies, packaging materials and other inventories owned by Intel or its Subsidiaries
relating exclusively to the Intel Business, whether in the possession of Intel, a Subsidiary of
Intel or a third party (including consigned inventory and inventory held by subcontractors);
provided, however, that in no event shall Intel Transferred Inventory include any raw materials
(including RAM), work-in-process, supplies, packaging materials or other inventories (other than
finished goods inventories) located at Intel’s D2 and IFO facilities.

     “Intel Transferred Liabilities” shall have the meaning set forth in Section
2.3 of the Intel Asset Transfer Agreement.

     “Intel Transferred Patents” means those Patents identified on Schedule 2.1(h)
of the Intel ATA Disclosure Letter.

     “Intel Transferred Permits” means those Permits identified on Schedule 2.1(l)
of the Intel ATA Disclosure Letter.

     “Intel Transferred Purchase Orders” means each purchase order or portion thereof
issued by Intel or a Subsidiary of Intel to the extent relating to the Intel Business.

     “Intel Transferred Sales Orders” means all pending and unfulfilled sales orders or
portions thereof for Intel Products.

     “Intel Transferred Systems” means factory support systems (for example, shop floor
control applications governing work stream models, SPC charts, APC configuration), data,
manufacturing station controllers linked to process equipment tools, and transferable elements of
systems and software, in each case exclusively related to the Intel Business, provided under the
Intel Transition Services Agreement which may be released to Newco in connection with the
termination of such agreement.

     “Intel Transferred Trade Secrets” means any Trade Secrets owned by Intel or any of its
Subsidiaries as of the Closing Date (including any such Trade Secrets that consist of technical
documentation of the nature of the files and other documentation identified on Schedule
2.1(h) to the Intel ATA Disclosure Letter) that are used exclusively in the Intel Business and
not materially embodied or used in or with any other current product or service of Intel or any of
its Subsidiaries.

     “Intel Transferred Trademarks” means those Trademarks identified on Schedule
2.1(k) of the Intel ATA Disclosure Letter.

     “Intel Transition Services Agreement” means the Intel Transition Services Agreement
identified on Schedule 2.1 of both of the Master Agreement Disclosure Letters to be entered
into

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by and between Intel and Newco on the Closing Date, in substantially the form attached to such
schedule.

     “Intellectual Property” means intellectual property rights arising from or in respect
of the following, whether protected, created or arising under the laws of the United States or any
other jurisdiction: Copyrights, Trade Secrets, Patents and Trademarks.

     “Internal Rules” means the internal rules (“reglement”) of Newco, in substantially the
form attached to Schedule 2.4 to both of the Master Agreement Disclosure Letters, as
amended from time to time.

     “Knowledge” means, with respect to any Person, the actual knowledge of such Person.
Notwithstanding the foregoing, with respect to any Person that is a corporation, limited liability
company, partnership or other business entity, actual knowledge shall be deemed to mean the actual
knowledge of all directors and officers of any such Person; provided, however, that (i) with
respect to Intel, “Knowledge” shall be deemed to be solely the actual knowledge of the individuals
identified in Section A of Schedule 1.1(b) of the Intel ATA Disclosure Letter, after
obtaining from the individuals identified in Section B of Schedule 1.1(b) of the Intel
ATA Disclosure Letter a certification as to their actual knowledge of each matter with
respect to which Intel makes any representation or warranty as to its Knowledge under any
Transaction Document, (ii) with respect to ST, “Knowledge” shall be deemed to be solely the actual
knowledge of the individuals identified on Schedule 1.1(b) of the ST ACA Disclosure Letter,
after obtaining from the individuals identified on Schedule 1.1(b) of the ST ACA Disclosure
Letter a certification as to their actual knowledge of each matter with respect to which ST makes
any representation or warranty as to its Knowledge under any Transaction Document, and (iii) with
respect to FP, “Knowledge” shall be deemed to be solely the actual knowledge of David ibnAle,
Phokion Potamianos, and Keith Toh.

     “Leased Intel Real Property” means the Intel Real Property listed in Schedule
3.6(b) of the Intel ATA Disclosure Letter.

     “Liability” means, with respect to any Person, any liability or obligation of such
Person of any kind, character or description, whether known or unknown, absolute or contingent,
asserted or unasserted, accrued or unaccrued, liquidated or unliquidated, secured or unsecured,
joint or several, due or to become due, vested or unvested, absolute, contingent, executory,
determined, determinable or otherwise and whether or not the same is required to be accrued on the
financial statements of such Person.

     “Lien” means, with respect to any asset, any lien, mortgage, pledge, hypothecation,
right of others, claim, security interest, encumbrance, lease, sublease, license, interest, option,
charge or other restriction or limitation of any nature whatsoever in respect of such asset,
including any Share Encumbrance; provided, however, that any license of Intellectual Property shall
not be considered a Lien on such Intellectual Property.

     “Losses” means any and all deficiencies, judgments, settlements, demands, claims,
suits, actions or causes of action, assessments, liabilities, losses, damages (excluding indirect,
incidental or consequential damages), interest, fines, penalties, costs and expenses (including

69

 

reasonable legal, accounting and other costs and expenses) incurred in connection with
investigating, defending, settling or satisfying any and all demands, claims, actions, causes of
action, suits, proceedings, assessments, judgments or appeals, and in seeking indemnification
therefor.

     “Managing Director” means any member of Newco’s Management Board.

     “Master Agreement” means that certain Master Agreement by and among Intel, ST, FP, and
FP Holdco dated May 22, 2007.

     “Minimum Committed Intel Inventory Value” means 91% of the Intel Inventory Value as of
the end of Intel’s first fiscal quarter of 2007.

     “Multiemployer Plan” means any employee pension benefit plan within the meaning of
Section 3(2) of ERISA that is a “multiemployer plan,” as defined in Section 3(37) of ERISA.

     “Newco Actuary” shall have the meaning set forth in Section 5.11(c) of the
Intel Asset Transfer Agreement.

     “Newco Allocated Positions” means those positions with Newco for which a Intel
Business Employee or a ST Business Employee is not allocated on Schedule 3.12(c) to the
Intel ATA Disclosure Letter or Schedule 3.12(c) to the ST ACA Disclosure Letter.

     “Newco Approvals” means any Governmental Approval which Intel, ST and FP reasonably
agree Newco must obtain in order to consummate the transactions contemplated by the Transaction
Documents.

     “Newco Indemnitees” means Newco and its Affiliates, officers, directors, shareholders,
representatives and agents.

     “Newco Restricted Employees” shall have the meaning set forth in Section
5.11(e)(i) of the Intel Asset Transfer Agreement.

     “NFA Letter” shall mean a letter from an appropriate Governmental Authority stating
that no further action is required to address any Intel Facility Environmental Liability or ST
Facility Environmental Liability, as applicable.

     “Notice of Claim” means a written notice by an Indemnitee to an Indemnitor of a claim
for Losses.

     “Ordinary Shares” means ordinary shares of Newco, par value [ ] eurocent per share.

     “Outstanding” means, as of any date of determination, all Shares that have been issued
on or prior to such date, other than Shares held, repurchased or otherwise reacquired by Newco on
or prior to such date.

     “Owned Intel Real Property” means the Intel Real Property listed in Schedule
3.6(a) of the Intel ATA Disclosure Letter.

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     “Patents” means patents and applications worldwide, including continuation,
divisional, continuation in part, reexamination, or reissue patent applications and patents issuing
thereon.

     “Permits” means all permits, licenses, franchises, approvals, certificates, consents,
waivers, concessions, exemptions, orders, registrations, notices or other authorizations of any
Governmental Authority necessary for a Party or its Subsidiaries to own, lease and operate such
Party’s Transferred Assets and to carry on such Party’s Business as currently conducted.

     “Permitted Liens” means (i) Liens for Taxes or governmental assessments, charges or
claims the payment of which is not yet due or which are both (A) being contested in good faith, and
(B) described in reasonable detail on a Schedule to the applicable Transaction Document, (ii)
statutory Liens of landlords and statutory Liens of carriers, warehousemen, mechanics or
materialmen incurred in the ordinary course of business which are either for sums not yet due or
are immaterial in amount, (iii) zoning, entitlement, and other land use laws, and (iv) easements
and other imperfections of title or encumbrances, in each case, that do not materially detract from
the value of the relevant Transferred Asset or materially interfere with any present or intended
use of such Transferred Asset.

     “Person” means an individual, corporation, partnership, association, limited liability
company, trust, estate or other similar business entity or organization, including a Governmental
Authority and any syndicate or group that would be deemed to be a person under Section 13(d)(3) of
the Exchange Act.

     “Planned Intel Capital Expenditures” shall have the meaning set forth in Section
2.9 of the Intel Asset Transfer Agreement.

     “Post-Closing Tax Period” means any Tax period (or portion thereof) beginning after
the Closing Date.

     “Pre-Closing Accounts Payable” means all Accounts Payable accruing or arising prior to
the Closing Date.

     “Pre-Closing Accounts Receivable” means all Accounts Receivable accruing or arising
prior to the Closing Date.

     “Pre-Closing Tax Period” means any Tax period (or portion thereof) ending on or before
the Closing Date.

     “Preferred Shares” means convertible preferred shares of Newco, par value [ ]
eurocent per share.

     “Preliminary Intel Inventory Statement” has the meaning provided in Section
2.7(a) of the Intel Asset Transfer Agreement.

     “Prepayments” means all prepaid items and deposits paid by a Party or any of its
Subsidiaries to the extent relating to such Party’s Business, and any claim, remedy or other right
related to any of the foregoing.

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     “Proceeding” means any action, suit, claim, charge, hearing, arbitration, audit, or
proceeding (public or private).

     “Property Taxes” shall have the meaning set forth in Section 5.8(b)(iii) of
the Intel Asset Transfer Agreement.

     “Purchase Price” shall have the meaning set forth in Section 2.2 of the Share
Purchase Agreement.

     “Receiving Party” shall (i) for purposes of the Intel Asset Transfer Agreement, have
the meaning set forth in Section 5.1(b) of the Intel Asset Transfer Agreement, (ii) for
purposes of the ST Asset Contribution Agreement, have the meaning set forth in Section
5.1(b) of the ST Asset Contribution Agreement and (iii) for purposes of the Intel Intellectual
Property Agreement and the ST Intellectual Property Agreement, with respect to Confidential
Information of a Party, mean another Party that is not a Licensing Affiliate of such Party and that
receives (or receives access to) such Confidential Information pursuant to or in connection with
the Intel Intellectual Property Agreement or the ST Intellectual Agreement.

     “Remedial Action” means investigation, evaluation, risk assessment, monitoring,
response, removal, clean-up, remediation, corrective action or other terms of similar import and
any related closure, post-closure, operations and maintenance or engineering control activities.

     “Restricted Employee” means any ST Restricted Employee, any Newco Restricted Employee
or any Intel Restricted Employee.

     “Sales Taxes” means any excise, value added, registration, stamp, recording,
documentary, conveyancing, transfer, sales, use and any other similar Taxes arising out of the
transfer of the applicable Transferred Assets.

     “Share Encumbrances” means Liens, claims, options, rights of other parties, voting
trusts, proxies, shareholder or similar agreements, encumbrances or other restrictions (other than
restrictions imposed by applicable securities laws).

     “Share Purchase Agreement” means the Share Purchase Agreement to be entered into by FP
and Newco as of the Closing Date, in substantially the form attached to Schedule 2.3 to the
Intel Master Agreement Disclosure Letter and to Schedule 2.3 to the ST Master Agreement
Disclosure Schedule.

     “Shareholders’ Agreement” means the Shareholders’ Agreement by and among Intel (as
used in this definition, “Intel” has the meaning ascribed to such term in the Shareholders’
Agreement), ST (as used in this definition, “ST” has the meaning ascribed to such term in the
Shareholders’ Agreement), FP (as used in this definition, “FP” has the meaning ascribed to such
term in the Shareholders’ Agreement), FP Holdco and Newco to be entered into on the Closing Date,
substantially in the form attached to Schedule 2.4 to both of the Master Agreement
Disclosure Letters.

     “Specified Intel Representations” means any representation or warranty made by Intel
in Sections 3.1 through 3.24 (other than Section 3.17) of the Intel Asset
Transfer Agreement or

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Sections 3.1(a) through 3.1(g) of the Master Agreement (other than Section
3.17 of the Intel Asset Transfer Agreement).

     “ST” means STMicroelectronics N.V., a limited liability company organized under the
laws of The Netherlands, with corporate seat in Amsterdam, The Netherlands.

     “ST Approvals” means the required consents, waivers and approvals of ST set forth on
Schedule 3.3 of the ST ACA Disclosure Letter and Schedule 3.2(c) of the ST Master
Agreement Disclosure Letter.

     “ST Asset Contribution Agreement” means that certain Asset Contribution Agreement to
be entered into by ST and Newco as of the Closing Date, in substantially the form attached to
Schedule 2.4 to the ST Master Agreement Disclosure Letter.

     “ST Transferred Assets” shall have the meaning set forth in Section 2.1 of the
ST Asset Contribution Agreement.

     “Straddle Period” shall have the meaning set forth in Section 5.8(a) of the
Intel Asset Transfer Agreement.

     “Subsidiary” means, with respect to any Person, (i) any corporation, limited liability
company or other similar entity as to which more than 50% of the outstanding capital stock or other
securities having voting rights or power is owned or controlled, directly or indirectly, by such
Person and/or by one or more of such Person’s direct or indirect subsidiaries and (ii) any Person
with a partnership, joint venture or other similar relationship between such Persons and any other
Person, provided, however, that with respect to Intel, Silicon Philippines, Inc., a corporation
organized and existing under Philippines law (“SPI”), shall be deemed to be a Subsidiary of Intel
for purposes of the Transaction Documents and for convenience only, and such inclusion of SPI
within this definition shall not imply that such entity is a subsidiary or affiliate of Intel for
any purpose independent of the Transaction Documents.

     “Taxes” means (i) all foreign, federal, state, local and other net income, gross
income, gross receipts, sales, use, ad valorem, value added, intangible, unitary, capital gain,
transfer, franchise, profits, license, lease, service, service use, withholding, backup
withholding, payroll, employment, estimated, excise, severance, stamp, occupation, premium,
property, prohibited transactions, windfall or excess profits, value added tax, goods and services
tax, social service tax, import tax, export tax, or other taxes of any kind whatsoever, together
with any interest and any penalties, additions to tax or additional amounts with respect thereto,
(ii) any Liability for payment of amounts described in clause (i) whether as a result of transferee
Liability, of being a member of an affiliated, consolidated, combined or unitary group for any
period, or otherwise through operation of law, and (iii) any Liability for the payment of amounts
described in clause (i) or (ii) as a result of any tax sharing, tax indemnity or tax allocation
agreement or any other express or implied agreement to indemnify any other Person for Taxes; and
the term “Tax” means any one of the foregoing Taxes.

     “Tax Returns” means all returns, declarations, reports, statements, information
statements, forms or other documents filed or required to be filed with respect to any Tax.

73

 

     “Third Actuary” shall have the meaning set forth in Section 5.11(c) of the
Intel Asset Transfer Agreement and the ST Asset Contribution.

     “Third Party Appraisal Firm” shall have the meaning set forth in Section 4.13
of the Master Agreement.

     “Trademarks” means trademarks and registrations and applications therefor.

     “Trade Secrets” means confidential know how, inventions, discoveries, concepts, ideas,
methods, processes, designs, formulae, technical data, source code, drawings, specifications
(including logic specifications), data bases, data sheets, customer lists, Customer Data and other
confidential information that constitute trade secrets under applicable law, in each case excluding
any rights in respect of any of the foregoing that comprise Copyrights, mask work rights or
Patents.

     “Transaction Documents” means the Master Agreement, the Intel Asset Transfer
Agreement, the ST Asset Contribution Agreement, the Share Purchase Agreement, the Intel Ancillary
Agreements, the ST Ancillary Agreements, the Shareholders’ Agreement, the Confidentiality
Agreement, and all of the documents contemplated by any such agreement or entered into by any of
the Parties thereto or their Subsidiaries in connections with the transactions contemplated by such
agreements.

     “Uncapped Intel Losses” means Losses (i) pursuant to a breach of any of Sections
3.2 (Authorization and Enforceability), 3.10 (Tax Matters), 3.12(a) (Pension
Plans), 3.15 (Environmental Matters), and 3.22(a) (Organization) and 3.22
(b) (Capitalization), (ii) pursuant to Section 6.2(a)(iii), (iii) resulting from a
breach of any covenant other than those set forth in Section 4.9 of the Master Agreement
and (iv) resulting from a willful breach of any covenant set forth in Section 4.9 of the
Master Agreement).

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