CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
THE `[**]` SYMBOL INDICATES THAT INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24B-2 AND THAT CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO SUCH OMITTED PORTIONS.
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DEVELOPMENT AND SUPPLY AGREEMENT
FOR DISK ON KEY CBIC ASIC
This Development and Supply Agreement (this "Agreement") is made and entered into as of April 18, 2001 (the "Effective Date") by and between Atmel Rousset, with offices located Zone Industrielle 13106, Rousset Cedex ,France and Atmel Sarl, a Swiss corporation with offices at Route des Arsenaux 41, Case Postale 80, CH-1705 Fribourg, Switzerland (hereafter collectively referred to as "Atmel"), and M-Systems, an Israeli corporation with principal offices located at Central Park 2000, 7 Atir Yeda St., Kfar Saba 44425, Israel ("Company").
RECITALS
WHEREAS, Atmel Rousset is in the business of designing, developing, and manufacturing various types of integrated circuits;
WHEREAS, Atmel Sarl is in the business of supplying such integrated circuits;
WHEREAS, Company is in the business of developing and marketing electronic disks for data storage based on flash memory for markets such as embedded systems, telecommunications, and Internet appliances; and
WHEREAS, Atmel and Company desire to enter into this Agreement for the purpose of setting forth the terms and conditions under which Atmel will design, develop and manufacture the semiconductor device described herein.
AGREEMENT
IN CONSIDERATION THEREOF AND THE MUTUAL PROMISES CONTAINED HEREIN, THE PARTIES HERETO AGREE AS FOLLOWS:
1. Statement of Work
a. The specification of the Product shall be concluded between Company and Atmel as described in Exhibit A.
b. Atmel shall layout, develop, manufacture, test and supply, the Products described in Exhibit A. Atmel shall provide all technology, labor, material, tooling and facilities necessary for performing such services.
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c. Company shall provide ongoing consultation throughout the design and development process.
d. The parties shall mutually agree to a joint development flow to be attached as Exhibit F hereto.
2. Non-Recurring Engineering
Company shall pay Atmel non-recurring engineering ("NRE") charges for all services rendered hereunder as set forth in Exhibit B attached hereto. These charges shall be billed and shall be payable within thirty (30) days of the date of invoice.
3. Exclusivity
The Products shall be sold to Company on an exclusive basis. Atmel shall have no right to manufacture for its own use or to offer or sell Products to any third party without the written consent of Company.
4. Product Pricing and Delivery
a. Company shall pay Atmel for the Products as set forth in Exhibit B attached hereto.
b. All shipments covered by these terms and conditions are F.C.A Atmel`s facility (Free Carrier - Incoterms 2000). Atmel`s liability for delivery shall cease upon Atmel delivering the products to the common carrier at Atmel`s facility. Title and all risk of loss or damage to the products shall pass to Company upon delivery to the common carrier at Atmel`s facility.
c. Unless otherwise agreed to by the parties, the prices stated herein do not include customs duties or any sales, use, excise, or other similar taxes. Company shall pay, in addition to the prices stated, the amount of any present or future customs duties or any sales, use, excise or other similar tax applicable to the sale of products or performance of services covered by these terms, or in lieu thereof, Company shall supply Atmel with an appropriate tax exemption certificate.
5. Product Forecasting and Production Lead Time and Cancellations
a. Company shall provide Atmel with a twelve (12) month non- binding rolling forecast.
b. Company shall be financially responsible for all Products covered by purchase orders within the product lead times as defined in Exhibit C.
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c. On time delivery is defined as not more than three (3) days early, or five (5) days late.
d. Reschedules or cancellations are detailed in Exhibit C.
6. Risk orders
If Company decides to release orders requiring fabrication or assembly of devices prior to prototype acceptance such orders will be deemed to be a Risk Order. The prices for Risk Orders will be detailed in Exhibit B. Company has the right to cancel Risk Orders per a liability schedule also detailed in Exhibit B.
7. Upsides
Atmel can respond to upsides as defined in Exhibit C.
8. End of Life
a. In the event that Atmel decides to discontinue the Product Atmel will provide Company with a written notification six (6) months in advance for last time buy orders to be placed by Company. Company will have the right to receive delivery for such orders for an additional six (6) months.
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