\nSanDisk 10% $60M 0%
\n– ——————————————————————————–
\nOtherVen TBD% $TBD 0%
\n– ——————————————————————————–
\nUMC, UMC Affiliates* 40% $240M 15%
\nUSI employees, UMC
\nemployees** & R.O.C.
\nfinancial institutions
\n– ——————————————————————————–
\nTotal shareholding 85% $510M 15%
\n– ——————————————————————————–<\/p>\n<\/c><\/c><\/c><\/caption>\n<\/table>\n
*For purposes of this Foundry Venture Agreement, “UMC Affiliates” shall mean
\nthose entities: (i) nominated by UMC and approved by the Venturers in writing,
\n(ii) which UMC directly and\/or indirectly controls, and\/or (iii) in which UMC
\ndirectly or indirectly owns a majority interest.<\/p>\n
3.<\/p>\n
4<\/p>\n
**UMC employees who intend to become (and who later become) regular employees of
\nUSI will be among the USI shareholders pursuant to this table. The UMC employees
\nand the eligible USI employees shall be required to pay the value shown in this
\ntable for their standard shares.<\/p>\n
(c) The Venturers shall pay in cash for their standard shares as
\nfollows:<\/p>\n
(i) twenty-five percent (25%) to be paid in full on the later of
\n September 15, 1995, or when the appropriate governmental approvals for
\n the formation of USI have been obtained;<\/p>\n
(ii) fifty percent (50%) to be paid in full on or before the start of
\n clean room construction; and<\/p>\n
(iii) the remainder, twenty-five percent (25%), to be paid in full on or
\n before the start of fab production ramp-up.<\/p>\n
(d) Subject to the requirements of law and pursuant to the applicable
\nstatutory and regulatory rules, the standard shares of the Venturers, of the UMC
\nAffiliates, of the UMC employees, and of the USI employees as shown in paragraph
\n4.1(b) above shall vest upon payment for the shares involved; UMC’s technical
\nshares shall vest upon completion of first silicon for any process licensed from
\nUMC having feature sizes of 0.35u or less; the shares of UMC Affiliates (to the
\nextent fully paid) shall be issued as UMC requests; and the shares of UMC and
\nUMC Affiliates shall be transferrable amongst UMC and UMC Affiliates without the
\nnecessity of USI’s, SanDisk’s, and\/or OtherVen’s prior written consent.<\/p>\n
(e) The Venturers’ shares shall be common stock, and, to the fullest
\nextent allowable under the law, will be registered in any public offering by
\nUSI, provided that with respect to such shares, each Venturer (and all UMC
\nAffiliates holding such shares) must follow and comply with all requirements of
\nR.O.C. law and of the Taiwan Securities and Exchange Commission and of the
\nTaiwan Securities Exchange, including, without limitation, with respect to
\nstand-still, lock-up, and\/or other requirements.<\/p>\n
(f) Until USI completes a successful offering of its shares on a
\nrecognized securities exchange, the shares of the Venturers (and of UMC
\nAffiliates holding such shares) in USI will not be transferable in any manner
\nwhatsoever except with the written consent of the Venturers, provided however
\nthat any Venturer may transfer its entire right, title and interest in USI
\n(including its proportionate right of first refusal for foundry capacity, the
\n“Foundry Rights”) and other rights under the Foundry Venture Agreement and\/or
\nVenture Agreements:<\/p>\n
(i) once but only to the extent and only as part of a transfer of all or
\n substantially all of the assets, business and\/or ownership of that
\n Venturer to a transferee subject, with respect to the Foundry Rights, to
\n the terms of paragraph 4.1(f)(iii) below; and\/or<\/p>\n
4.<\/p>\n
5<\/p>\n
(ii) once to or between itself and any of its subsidiaries in which, at the
\n time of such transfer, the transferring Venturer owns at least 50%.<\/p>\n
Notwithstanding anything to the contrary:<\/p>\n
(iii) the Foundry Rights when and if transferred pursuant to Paragraph
\n 4.1(f)(i) above shall only be exercisable with respect to the manufacture
\n of products which the transferring Venturer at the time of such transfer
\n was selling, was designing (as reflected in contemporaneous documents) or
\n was contemplating designing and selling (as demonstrated in its then
\n written business plan(s)), and all future revisions and more highly
\n integrated versions of such products.<\/p>\n
(iv) if prior to the completion of a public offering of USI securities on a
\n recognized securities exchange, any Venturer (or UMC Affiliate holding such
\n shares) wishes and\/or attempts to transfer its shares in USI (other than as
\n allowed by Paragraph 4.1(f)(i) and\/or 4.1(f)(ii)) pursuant to any Court or
\n other order or law, or as a result of any nonconsensual action by any
\n authority with jurisdiction, the shares involved will be subject to a right
\n of first refusal as follows:<\/p>\n
(aa) the other Venturers (the “eligible other Venturers”) will have
\n the right to purchase the shares involved at their then fair market
\n value as determined by a mutually agreeable independent appraiser;<\/p>\n
(bb) each such eligible other Venturer will have the right to
\n purchase such shares on a pro rata basis as determined by the ratio
\n of their respective shareholding percentages (which, absent any
\n previously permitted transfers, would be as shown in the table in
\n Paragraph 4.1(b) above);<\/p>\n
(cc) if any such eligible other Venturer elects not to exercise any
\n portion or all of such right of first refusal within 30 days of the
\n independent appraisal, such portion of such right of first refusal
\n will be subject to exercise by the other eligible other Venturer,
\n and the shares involved will be subject to a right of such other
\n eligible other Venturer to purchase on the same terms as outlined
\n above; and<\/p>\n
(dd) if the other eligible other Venturer does not commit to
\n purchase such shares within 60 days of the independent appraisal,
\n all rights under this Paragraph 4.1(f)(iv) will expire as to such
\n unpurchased shares.<\/p>\n
(g) Subject to the requirements of and to the extent permissible under
\nR.O.C. law, to the extent that USI wishes to offer any equity beyond the USD
\n$600 million referred to in Paragraph 4.1(a) above, each Venturer shall have the
\nright of first refusal to participate in such offering in proportion to its then
\ncurrent respective shareholding.<\/p>\n
5.<\/p>\n
6<\/p>\n
4.2 The parties shall in good faith after execution of this Foundry
\nVenture Agreement enter into negotiations regarding audit and information rights
\nto be provided to the Venturers, in order to, among other things, make timely
\npublic disclosure of information about USI’s profits, losses, and\/or other
\nfinancial information reasonably required, in the view of such Venturer’s
\ncounsel and accountants, to be disclosed separately, in conjunction with, or
\nconsolidated into, such Venturer’s public quarterly, annual and\/or other
\nreports. Such rights shall at a minimum be sufficient for such Venturers to
\ntimely comply with their public reporting obligations, but shall not require USI
\nto pay for and\/or incur the expenses of such matters. In the event the parties
\ndo not reach agreement on such rights by December 15, 1995, the extent of such
\nrights will be decided conclusively by Price Waterhouse & Co. (Taipei office)
\nand a nationally recognized independent accounting firm nominated by SanDisk and
\nOtherVen. If the aforesaid accounting firms fail to decide such rights by
\nJanuary 30, 1996, the matter shall be resolved by binding arbitration on an
\nexpedited basis.<\/p>\n
5. FOUNDRY CAPACITY & COMMITMENTS<\/p>\n
Each Venturer’s obligations under Paragraphs 1 to 5 of this Foundry
\nVenture Agreement shall be conditioned upon entry by the Venturer into a Foundry
\nCapacity Agreement with USI (the “Foundry Capacity Agreement”) and none of the
\nobligations of the Venturer or of USI under those sections shall be binding
\nuntil such time as it enters such a Foundry Capacity Agreement. The terms of the
\nArticles of Incorporation and Bylaws of USI shall be consistent with the terms
\nof this Foundry Venture Agreement, and the Venture Agreements.<\/p>\n
6. TERMINATION OF RIGHTS & PRIVILEGES<\/p>\n
6.1 Subject to Paragraph 6.2 below, any one or more of the Venturers
\nand\/or USI (collectively “the Parties”) shall have the right to terminate the
\nrights of any other Party under this Foundry Venture Agreement and\/or the
\nVenture Agreements by giving written notice of termination to that other Party
\nat any time upon or after:<\/p>\n
(a) the filing by the other Party of a petition in bankruptcy or
\ninsolvency;<\/p>\n
(b) any adjudication that the other Party is bankrupt or insolvent;<\/p>\n
(c) the filing by the other Party of any petition or answer seeking
\nreorganization, readjustment or arrangement of its business under any law
\nrelating to bankruptcy or insolvency;<\/p>\n
(d) the appointment of a receiver for all or substantially all of the
\nproperty of the other Party;<\/p>\n
6.<\/p>\n
7<\/p>\n
(e) the making by the other Party of any assignment for the benefit of
\ncreditors; or,<\/p>\n
(f) the institution of any proceeding for the liquidation or winding up
\nof the other Party’s business or for the termination of its corporate charter.<\/p>\n
Notwithstanding anything to the contrary, no termination under this Paragraph
\n6.1 as to such other Party shall affect the rights of any other Venturer under
\nthis Foundry Venture Agreement and\/or the Venture Agreements.<\/p>\n
6.2 (a) Termination pursuant to Paragraph 6.1 above shall be effective
\nimmediately upon delivery of the written notice, or in the case of airmail
\nnotice, four days after dispatch, pursuant to Paragraph 8 below.<\/p>\n
(b) Upon termination as to a Venturer under Paragraph 6.1 above, any
\nshares held by that Venturer shall be subject to purchase by the remaining
\nVenturers pursuant to Paragraph 4.1(f)(iv) above.<\/p>\n
(c) Except as permitted in paragraph 4.1(f), no Venturer may transfer
\nits interest or right in USI in any manner to any competitor of UMC or to any
\nentity in the business of fabricating integrated circuits except under terms (i)
\nin which such Venturer first relinquishes and releases all rights to USI
\ncapacity under this and any and all other agreements, and (ii) in which such
\nentity and\/or competitor expressly consents in writing that they have no such
\ninterest or right to such capacity.<\/p>\n
6.3 USI will undertake its reasonable best efforts to implement the
\nTechnology Road Map attached as Attachment B, and to achieve the goals described
\nin the USI Business Plan. In addition, and subject to the terms of this Foundry
\nVenture Agreement and the Venture Agreements, USI will cooperate with each
\nVenturer in a commercially reasonable manner to qualify products of such
\nVenturer under the processes involved.<\/p>\n
7. DISPUTE RESOLUTION<\/p>\n
7.1 The Venturers and USI shall cooperate and attempt in good faith to
\nresolve any and all disputes arising out of and\/or relating to this Foundry
\nVenture Agreement and\/or any of the Venture Agreements. Without limiting the
\nforegoing, within thirty days of a written demand to meet to resolve such a
\ndispute, senior management with the authority to negotiate and resolve the
\nissues shall meet in the State of Hawaii or in some other mutually agreeable
\nlocation to discuss the issues, from time to time during the forty-five day
\nperiod following such demand (or longer if agreeable to the Venturers involved)
\nas reasonably requested by any party involved, and such senior management will
\nattempt to resolve the dispute.<\/p>\n
7.2 Any such disputes relating to and\/or arising out of this Foundry
\nVenture Agreement and\/or any of the Venture Agreements which cannot be so
\nresolved will be<\/p>\n
7.<\/p>\n
8<\/p>\n
decided exclusively by binding arbitration under procedures which ensure
\nefficient and speedy resolution. Such an arbitration may be commenced by USI
\nand\/or any Venturer involved in the dispute (i) after the expiration of the
\nforty-five day period following the written demand to meet to resolve the
\ndispute pursuant to Paragraph 7.1 above, and\/or (ii) at such earlier time as any
\nParty involved repudiates and\/or refuses to continue with its obligations to
\nnegotiate in good faith.<\/p>\n
7.3 The arbitration hearing will be before a panel of three neutral,
\nindependent arbitrators. The arbitration hearing will be conducted in the State
\nof Hawaii, and will be in the English language (with translations and
\ninterpretations as reasonable for the presentation of evidence and\/or conduct of
\nthe arbitration). Notwithstanding anything to the contrary, any party may apply
\nto any court of competent jurisdiction for interim injunctive relief as may be
\nallowed under applicable law with respect to irreparable harm which cannot be
\navoided and\/or compensated by such arbitration proceedings, without breach of
\nthis Paragraph 7 and without any abridgment of the powers of the arbitrators.<\/p>\n
7.4 The arbitration will be conducted under the Rules of the Asia
\nPacific Arbitration Center. Notwithstanding anything to the contrary:<\/p>\n
(a) the arbitrators will have no power to order discovery; and<\/p>\n
(b) the arbitrators shall require pre-hearing exchange of documentary
\nevidence to be relied upon by each of the respective parties in their respective
\ncases in chief, and pre-hearing exchange of briefs, witness lists and summaries
\nof expected testimony.<\/p>\n
7.5 The arbitrators will make their decision in writing; and their
\ndecision will be binding upon the Venturers and USI and it may be entered by any
\ncourt having jurisdiction.<\/p>\n
8. NOTICES<\/p>\n
All notices required or permitted to be given under this Foundry Venture
\nAgreement and\/or any of the Venture Agreements shall be in writing and be deemed
\nas given when delivered, or in the case of airmail, four days after dispatch,
\nand shall be addressed as follows and dispatched by personal delivery, by
\nairmail letter in any post office in the U.S. or in Taiwan, or by facsimile:<\/p>\n
If to SanDisk:
\n SanDisk Corporation
\n 140 Caspian Court
\n Sunnyvale CA 94089
\n Attention: Eli Harari, President
\n fax (408) 542-0503; fon (408) 542-0500<\/p>\n
If to UMC:<\/p>\n
8.<\/p>\n
9<\/p>\n
United Microelectronics Corporation
\n No. 13 Innovation Road I
\n Science Based Industrial Park
\n Hsin Chu City, Taiwan, R.O.C.
\n Attention: John Hsuan, President
\n fax (035) 774-767; fon (035) 782-258<\/p>\n
If to USI:
\n USI
\n No. 3 Li-Hsin Road
\n Science Based Industrial Park
\n Hsin Chu City, Taiwan, R.O.C.
\n Attention: President
\n fax (035) ; fon (035)<\/p>\n
Any Venturer and\/or USI may at any time give written notice of a change of its
\naddress to the others.<\/p>\n
9. MISCELLANEOUS<\/p>\n
9.1 No Party shall be liable to the others with respect to the failure
\nor delay in the performance of any obligation under this Foundry Venture
\nAgreement and\/or any of the Venture Agreements for the time of and to the extent
\nthat such failure is caused by or the result of war, fire, flood, earthquake,
\nacts of god or any causes beyond the reasonable control of the Venturers and\/or
\nUSI.<\/p>\n
9.2 No Party shall be liable to the others (i) for any special,
\nincidental, indirect or consequential damages; (ii) for increased costs of
\nobtaining substitute goods or services to the extent such increased costs are in
\nexcess of those amounts which such Party would have been entitled to receive for
\nthe goods and services involved had it properly performed; (iii) for loss of
\nuse, opportunity, market potential, and\/or profit, on any theory (whether
\ncontract, tort, from third party claims or otherwise).<\/p>\n
9.3 Except as expressly stated above and in Paragraphs 9.5 and\/or 9.13
\nbelow and\/or in the Venture Agreements, no Party makes any warranties or
\nrepresentations (express, implied or statutory), and there are no other
\nwarranties, representations, or indemnities, and THE PARTIES EXPRESSLY DISCLAIM
\nALL SUCH OTHER WARRANTIES, INCLUDING WITHOUT LIMITATION THE IMPLIED WARRANTIES
\nOF MERCHANTABILITY AND FITNESS FOR PARTICULAR PURPOSE. Without limiting the
\nforegoing, except as expressly stated in this Foundry Venture Agreement and\/or
\nin any of the Venture Agreements (these “Agreements”), there are no other
\nrepresentations and\/or warranties concerning the subject matter of such
\nAgreements, and\/or relating to USI of any<\/p>\n
9.<\/p>\n
10<\/p>\n
sort or manner, and each Party expressly agrees that it is not relying upon any
\nsuch other representations and\/or warranties. Each Party has consulted with
\ncounsel concerning such Agreements and USI, and enters into these Agreements
\nwith full advice and understanding and accepting the risks involved.<\/p>\n
9.4 Notwithstanding anything to the contrary (whether in the Venture
\nAgreements or elsewhere), nothing contained in this Foundry Venture Agreement,
\nin the Venture Agreements, and\/or in the USI Business Plan shall be or be
\nconstrued as:<\/p>\n
(a) a warranty or representation as to the validity, utility,
\nsuitability or economic viability of this opportunity or of any intellectual
\nproperty or technology except as expressly stated in paragraph 9.5 below, in
\nParagraph 9 of the Technology Transfer and License Agreement, and\/or in
\nParagraphs 5 and\/or 7 of the Foundry Capacity Agreement;<\/p>\n
(b) a warranty or representation that any manufacture, sales, use or
\nother disposition of products to be manufactured by USI will be free from
\ninfringement of patents, utility models and\/or design patents other than those
\nunder which licenses have been granted hereunder and\/or except as expressly
\nstated in paragraph 9.5 below, and\/or in Paragraph 7 of the Foundry Capacity
\nAgreement;<\/p>\n
(c) a warranty or representation that USI will be successful, that USI
\nwill realize and\/or fulfill any of its Business Plans, that USI will go public
\nor return profit to the Parties, or that the Parties will recover their
\ninvestments (for purposes of this Paragraph 9.4(c), any covenant or obligation
\nin these Agreements shall not be eliminated and\/or excluded by reason of it also
\nbeing part of the USI Business Plan, nor shall this Paragraph 9.4(c) absolve USI
\nfrom efforts required under these Agreements to implement the USI Business
\nPlan);<\/p>\n
(d) conferring any right to the other Parties to use in advertising,
\npublicity, or otherwise, any trademark, trade name or names of any Party, or any
\ncontraction, abbreviation or simulation thereof; and\/or<\/p>\n
(e) conferring by implication, estoppel or otherwise, upon any Party any
\nlicense or other right under any class or type of patent, utility model or
\ndesign patent except the licenses and rights expressly granted under the Venture
\nAgreements.<\/p>\n
9.5 (a) Each Venturer represents and warrants to the other Venturers and
\nto USI that all technology, processes, masks and other information tranferred by
\nthat Venturer pursuant to the terms of this Foundry Venture Agreement and\/or the
\nVenture Agreements, and\/or its respective foundry relationship with USI shall be
\nfree from any claims of infringement or violation of valid and enforceable trade
\nsecret, trademark, copyright, and\/or mask work rights of others; and that
\nVenturer shall defend, indemnify and hold the other Venturers and USI harmless
\nfrom and against any claims to the contrary, provided however that such
\nindemnifying Venturer shall receive (i) prompt written notification of any claim
\nfor which it is providing indemnification under this Paragraph 9.5, (ii) the
\nright to assume, in a<\/p>\n
10.<\/p>\n
11<\/p>\n
prompt fashion, sole control of the defense or settlement of such claim
\n(provided that the indemnifying Venturer cannot commit any other Venturer and\/or
\nUSI to the payment of sums), and (iii) reasonable assistance from the
\nindemnified party or parties, at the indemnifying Venturer’s request and expense
\nand provided further that if the indemnifying Venturer assumes sole control of
\nthe defense of such claim, the indemnified party may, at its expense,
\nparticipate in such defense.<\/p>\n
(b) USI represents and warrants to the Venturers that all technology,
\nprocesses, masks and other information transferred by it (in products or
\notherwise) or used by it in any process employed in the fabrication of products
\npursuant to the terms of this Foundry Venture Agreement and\/or the Venture
\nAgreements, and\/or under its respective foundry relationships with the Venturers
\nshall be free from any claims of infringement or violation of valid and
\nenforceable trade secret, trademark, copyright, and\/or mask work rights of
\nothers; and USI shall defend, indemnify and hold the Venturers harmless from and
\nagainst any claims to the contrary, provided however that USI shall receive (i)
\nprompt written notification of any claim for which it is providing
\nindemnification under this Paragraph 9.5, (ii) the right to assume, in a prompt
\nfashion, sole control of the defense or settlement of such claim (provided that
\nUSI cannot commit any Venturer to the payment of sums), and (iii) reasonable
\nassistance from the indemnified party or parties, at USI’s request and expense,
\nand provided further that if USI assumes sole control of the defense of such
\nclaim, the indemnified party may, at its expense, participate in such defense.<\/p>\n
9.6 The obligations of the Parties under Paragraphs 1 to 5 above shall
\nbe subject to and conditioned upon funding of USI by the Venturers and upon
\napproval of the formation of USI and of its operation at Module C by all
\nrequired governmental authorities, including without limitation, the Science
\nBased Industrial Park Administration, but the obligations under the other
\nParagraphs of this Agreement shall not be so conditioned. UMC shall cooperate
\nwith USI in securing such approvals within the time contemplated under the
\nschedule of Attachment A. The obligations and responsibilities of the Venturers
\nand USI under Paragraphs 6 to 9 shall survive the expiration and\/or termination
\nof this Foundry Venture Agreement.<\/p>\n
9.7 (a) For purposes of these Agreements, “Confidential Information”
\nshall mean:<\/p>\n
(i) any information disclosed by one party to another pursuant
\n to or in connection with these Agreements which is in written, graphic,
\n machine readable or other tangible form and is marked confidential,
\n proprietary, or in some other manner to indicate its confidential
\n nature; and<\/p>\n
(ii) any information orally disclosed by one party to another
\n pursuant to or in connection with these Agreements provided that such
\n information is designated as confidential at the time of disclosure and
\n reduced to a writing delivered to the<\/p>\n
11.<\/p>\n
12<\/p>\n
receiving party within thirty days of the oral disclosure and detailing
\n the confidential information involved.<\/p>\n
(b) Each party shall treat as confidential all Confidential Information
\nprovided by any other party, shall not use or disclose such Confidential
\nInformation except as contemplated in these Agreements and then only subject to
\nwritten confidentiality agreements at least as protective as those stated in
\nthis Foundry Venture Agreement. Without limiting the above, each party shall use
\nat least the same procedures and degree of care which it uses to prevent the
\ndisclosure of its confidential information of like importance and shall in no
\nevent use less than reasonable procedures and a reasonable degree of care.
\nNotwithstanding the above, no party shall have obligations with respect to
\nConfidential Information of any other party which:<\/p>\n
(i) Such party shows was generally known and available to the public at
\nthe time it was disclosed, or becomes generally known and available to the
\npublic through no fault of the receiver prior to the use and or disclosure of
\nsuch information by the receiver;<\/p>\n
(ii) Such party shows was known to the receiver without obligation of
\nconfidentiality at the time of disclosure as shown by written evidence in
\nexistence at the time of disclosure;<\/p>\n
(iii) Is disclosed with the prior written consent of the discloser;<\/p>\n
(iv) Such party shows becomes known to the receiver without obligations
\nof confidentiality; or<\/p>\n
(v) Is disclosed pursuant to the order or requirement of any court,
\nagency, or other governmental body having jurisdiction;<\/p>\n
provided, however, that, prior to any such disclosure pursuant to paragraphs
\n9.7(b)(v) above, the Party seeking disclosure shall notify the others and take
\nall reasonable actions in an effort to minimize the nature and extent of such
\ndisclosure.<\/p>\n
(c) Each party agrees that the terms of these Agreements and the USI
\nBusiness Plan shall be treated as Confidential Information and not disclosed,
\nprovided however that any and all parties may disclose the terms and conditions
\nof these Agreements and the USI Business Plan in confidence to its legal
\ncounsel, accountants, banks, and financing sources and their advisers, or
\npursuant to written confidentiality agreements having terms at least as
\nrestrictive as those this Paragraph 9.7 in connection with an actual or proposed
\nmerger or acquisition, and\/or in connection with the enforcement of its rights
\nunder this Foundry Venture Agreement<\/p>\n
12.<\/p>\n
13<\/p>\n
(d) Notwithstanding anything to the contrary, and subject to the
\nexceptions of Paragraph 9.7(b):<\/p>\n
(i) any Confidential Information disclosed to UMC by a Venturer which is
\n marked “UMC only” (or similarly) may be used and disclosed by UMC solely in
\n connection with preparing and submitting the USI Business Plan and
\n applications for governmental approvals relating to USI but may not
\n otherwise be disclosed by UMC to USI or to any other Venturer;<\/p>\n
(ii) any Confidential Information disclosed to UMC and\/or to USI which
\n is marked as “USI Internal Only” may be disclosed by UMC to USI, but may
\n not be disclosed by USI to any other Venturer; and<\/p>\n
(iii) any Confidential Information disclosed to a Venturer which is not
\n marked “UMC Only” and\/or “USI Internal Only” (or similarly) may be
\n disclosed to USI and\/or to any Venturer.<\/p>\n
(e) Without limiting the foregoing, in order to facilitate exchanges of
\nConfidential Information amongst themselves, the Venturers contemplate they may
\nnegotiate and execute one or more mutually satisfactory non-disclosure
\nagreements.<\/p>\n
(f) The obligations of this Paragraph 9.7 shall survive the expiration
\nor termination of this Foundry Venture Agreement and the Venture Agreements for
\na period of three (3) years after the last of them to expire and\/or terminate.
\nIn the event of any breach of this covenant, the Venturers and USI shall
\npromptly discuss and cooperate in good faith with respect to measures to
\nmitigate any harmful effect of such breach and with respect to possible
\ncompensation to the injured party.<\/p>\n
9.8 This Foundry Venture Agreement and the Venture Agreements are
\nwritten only in the English language, which language shall be controlling in all
\nrespects, and all versions in any other language shall be for accommodation only
\nand shall not be binding upon the Venturers. All communications to be made or
\ngiven pursuant to such Agreements shall be in the English language, except as
\nmay be required under applicable law.<\/p>\n
9.9 This Foundry Venture Agreement and the Foundry Capacity Agreement
\nand matters connected with performance under any one or more of them shall be
\ninterpreted and construed in all respects in accordance with the laws of the
\nState of California, provided however that all matters connected with the
\npurchase and formalities of stock and ownership interests in USI and the
\nTechnology Transfer and License Agreement shall be interpreted and construed in
\nall respects in accordance with the laws of Taiwan, the Republic of China, all
\nwithout regard to that body of law which pertains to conflicts and\/or choice of
\nlaw and excluding the UN Convention on Contracts for International Sales of
\nGoods.<\/p>\n
13.<\/p>\n
14<\/p>\n
9.10 If any provision of this Foundry Venture Agreement and\/or the
\nVenture Agreements is held wholly or partially unenforceable for any reason,
\nsuch unenforceability shall not affect the enforceability of the remaining
\nprovisions of such Agreements, and all provisions of such Agreements shall be
\nconstrued so as to preserve enforceability.<\/p>\n
9.11 (a) The terms and conditions contained in the USI Business Plan,
\nthis Foundry Venture Agreement and\/or the Venture Agreements and the documents
\nattached thereto (the “Plan and Agreements”) shall supersede all previous
\ncommunications, understandings, representations and\/or agreements, oral and\/or
\nwritten, between the Venturers with respect to the subject matter hereof;<\/p>\n
(b) There are no other such agreements, understandings and\/or writings
\nexcept as stated above;<\/p>\n
(c) No agreement or understanding varying, modifying or extending the
\nterms and\/or conditions of such Plan and Agreements, nor any custom, practice,
\ncourse of dealing or conduct of the parties, shall be binding upon any Venturer
\nunless in writing and signed by a duly authorized officer or representative of
\neach Party to be bound; provided however that a Venturer and USI may agree to
\nordering procedures which are established by them pursuant to mutual agreement;
\nand<\/p>\n
(d) Except as expressly allowed under this Foundry Venture Agreement, no
\nparty may transfer or assign its rights or delegate its duties under this
\nAgreement, except with the written consent of all the Parties to the agreement
\ninvolved.<\/p>\n
9.12 No licenses, other than the licenses expressly granted under these
\nAgreements, are granted under these Agreements, by implication, estoppel or
\notherwise. Nothing in these Agreements shall be construed as conferring any
\nlicense, right to use or other right with respect to any trademark or trade name
\nof any party. Each party may make reasonable reference by name to any other
\nparty provided that the written consent of that other has been obtained in
\nadvance.<\/p>\n
9.13 (a) The failure of any party to enforce, or the delay by any party
\nin enforcing any of its rights under these Agreements shall not be deemed a
\nwaiver or a containing waiver of such rights or a modification of these
\nAgreements, and such party may, within the time provided by applicable law,
\ncommence appropriate proceedings to enforce any and\/or all such rights.<\/p>\n
(b) The section headings in these Agreements are for convenience only
\nand do not define or limit nor will they be used to construe the content of such
\nsections.<\/p>\n
(c) Each party expressly represents and warrants that it is free to
\nenter into these Agreements and that such party has not made and will not make
\nany creations or commitments in conflict with the provisions of these
\nAgreements, or which reasonably might<\/p>\n
14.<\/p>\n
15<\/p>\n
interfere with the full and complete performance of such party’s obligations
\nunder these Agreements. Each party further represents and warrants that these
\nAgreements, and the performance of its respective obligations under these
\nAgreements, and the consummation of the transactions contemplated under these
\nAgreements have been duly authorized and approved by all necessary action, and
\nall necessary consents or permits have been obtained, and neither the execution
\nof these Agreements nor the performance of the party’s respective obligations
\nunder these agreements will violate any term or provision of any valid contract
\nor agreement to which such party is subject and\/or by which such party is bound.
\nNo further actions or consents are necessary to make these Agreements valid
\nbinding contracts, enforceable against the respective parties in accordance with
\ntheir terms.<\/p>\n
9.14 Nothing in this Foundry Venture Agreement and\/or in the Venture
\nAgreements shall be deemed to create a general or limited partnership or an
\nagency relationship between the Venturers and\/or USI, and the Venturers and USI
\nare independent companies. The Venturers intend to become shareholders of USI
\nand thereafter purchase products manufactured from USI in an arm’s length
\nvendor-purchaser relationship, and, in the case of USI and UMC, in an arm’s
\nlength vendor-purchaser, lessor-lessee, and licensor-licensee relationship. No
\nparty shall be entitled to act on behalf of and\/or to bind any one or more of
\nthe others.<\/p>\n
9.15 The Venturers will cause USI to execute promptly after its
\nformation the Foundry Capacity Agreement, Technology Transfer and License
\nAgreement, and this Foundry Venture Agreement, to confirm USI’s agreement to
\nabide by the terms in such agreements which are binding upon USI.<\/p>\n
IN WITNESS WHEREOF, the Venturers have caused this Foundry Venture Agreement to
\nbe signed below by their respective duly authorized officers.<\/p>\n
SANDISK CORPORATION<\/p>\n
\/s\/ ELI HARARI
\n ————————————-
\n Eli Harari<\/p>\n
UNITED MICROELECTRONICS
\n CORPORATION<\/p>\n
\/s\/ I.D. LIU
\n ————————————-
\n I.D. Liu, President First Group<\/p>\n
15.<\/p>\n
16<\/p>\n
The attached Written Assurances re: Foundry Venture Agreement and May 28, 1997
\nletter to Eli Harari are entered as part of this foundry agreement.<\/p>\n
16.<\/p>\n
17
\nACCORDING TO SECTION 232.304 OF REGISTRATION S-T, THE FOLLOWING NARRATIVE
\nDESCRIPTIONS REPRESENT A GOOD FAITH EFFORT TO FAIRLY AND ACCURATELY DESCRIBE
\nTHE GRAPHICAL IMAGE(S) ATTACHED TO THE PAPER FORMAT OF THIS AGREEMENT.<\/p>\n
I. Schedule of USI Plant Construction<\/p>\n
This graphical image represents the project schedule for building up the
\nnew fabrication facility and for producing wafers from this facility. The
\ntime-line represented in the graphical image begins at March 1996 and ends at
\nDecember 1998. The milestones represented on this graphical image are the
\nfollowing: “Building Construction,” “Office Partitions,” “Facility
\nInstallation,” Clean Room Installation,” “FAB Equipment Installation,” “Pilot,”
\nand “Production Ramp-up.” The time-lines for each milestone are confidential
\ninformation for which Confidential Treatment has been requested. Confidential
\nportions omitted have been filed with the Commission.<\/p>\n
II. USI Production Ramp-up Schedules<\/p>\n
The first line graph represents the projected wafer output versus time
\nfor the new venture. The abscissa of the line graph represents time, beginning
\nat April 1998 and ending March 1999 (the graph uses a monthly time line). The
\nordinate of the line graph represents wafer output of the new venture.
\nTherefore, the line graph represents the projected wafer output of the new
\nventure versus time. The values on the graph are confidential information for
\nwhich Confidential Treatment has been requested. Confidential portions omitted
\nhave been filed with the Commission.<\/p>\n
The second line graph describes the same information as the first with
\nthe exception that it is based on a quarterly schedule (more specifically, the
\nquarters of years 1998 and 1999) rather than a monthly schedule as in the first
\nline graph.<\/p>\n
III. Fabrication Facility Layout<\/p>\n
This graphical image represents the plat of the research park in which
\nthe new fabrication facility is located. The plat is written in Chinese. In
\nEnglish, the plat shows the location of Modules C and D with respect to two
\nmajor roads and with respect to each other. The location and situation of
\nModules C and D as well as the writing describing the map are confidential
\ninformation for which Confidential Treatment has been requested. Confidential
\nportions omitted have been filed with the Commission.<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8752,9171],"corporate_contracts_industries":[9508,9512],"corporate_contracts_types":[9613,9617],"class_list":["post-42314","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-sandisk-corp","corporate_contracts_companies-united-microelectronics-corp","corporate_contracts_industries-technology__hardware","corporate_contracts_industries-technology__semiconductors","corporate_contracts_types-operations","corporate_contracts_types-operations__jv"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/42314","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=42314"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=42314"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=42314"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=42314"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}