MASTER JOINT TECHNOLOGY DEVELOPMENT AGREEMENT

 

 

1.5           “Fab” shall mean the facility and associated assets owned by Jazz, and used by Jazz to provide specialty process foundry services and to manufacture semiconductor wafers, located in Newport Beach, California.

 

1.6           “Foreground” shall mean all inventions, discoveries, improvements, designs, information, data, methods, techniques, drawings, component board models, layouts, schematics, diagrams, functional blocks, cells, design rules, simulation models, net lists, software, test protocols, methods and patterns and other technology developed during the course of Work under a SOW, whether or not patentable, including all Intellectual Property Rights embodied therein.

 

1.7           “IC” shall mean an integrated circuit or other semiconductor device that performs electrical functions, including associated substrates, circuit elements, embedded passive elements, packaging, housing and other means of function and support.

 

1.8           “Intellectual Property Rights” shall mean all patents and all patent applications (including, without limitation, originals, divisions, continuations, continuations-in-part, CPA’s, RCE’s, provisional, extensions or reissues), design rights (whether registered or not and all applications for the foregoing), copyrights, database rights, topography rights, mask work rights, applications to register any of the aforementioned rights, trade secrets, rights in unpatented know-how, rights of confidence and any other intellectual or industrial property rights of any nature whatsoever in any part of the world.

 

1.9           “Jazz Background” shall mean the inventions, trade secrets, know-how, designs, information, data, processes, methods, techniques, drawings, component board models, layouts, schematics, diagrams, functional blocks, cells, design rules, simulation models, net lists, software, test protocols, methods and patterns and other technology owned or used, as at the effective date of a SOW, by Jazz and which Jazz may use or provide to RFMD in the performance of Work under such SOW including all Intellectual Property Rights embodied therein.

 

1.10         “Jazz Confidential Information” shall mean all information identified by Jazz as confidential and disclosed by Jazz to RFMD under the MOU, this Agreement or any SOW.

 

1.11         “Jazz Non-Process Background” shall mean Non-Process Background that is owned or used, as at the effective date of a SOW, by Jazz and which Jazz uses or provides to RFMD in the performance of Work under such SOW including all Intellectual Property Rights embodied therein.

 

1.12         “MOU” shall mean the nonbinding Memorandum of Understanding dated June 26, 2002, between the Parties.

 

1.13         “Non-Process Background” shall mean all Jazz Background and all RFMD Background other than Process Background.

 

1.14         “Non-Process Foreground” shall mean all Foreground other than Process Foreground.

 

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1.15         “Person” shall mean any individual, corporation, partnership, joint venture, trust, business association, governmental entity or other entity.

 

1.16         “Process” shall mean the semiconductor manufacturing technology used at the Fab to fabricate ICs and other semiconductor products, including variants of such technology used to manufacture CMOS, Bipolar, BiCMOS, SiGe and other devices, as the same is revised or updated from time to time under this Agreement or otherwise.

 

1.17         “Process Foreground” shall mean Foreground related to or constituting an improvement, modification, revision, iteration or other adaptation of the Process and any Foreground related to or constituting a new Process.

 

1.18         “Prototype” shall mean a preliminary version of an IC fabricated by Jazz on behalf of RFMD under a SOW, which is intended for evaluation, testing, characterization and tuning and which may or may not be functional.

 

1.19         “RFMD Background” shall mean the inventions, trade secrets, know-how, designs, information, data, processes, methods, techniques, drawings, component board models, layouts, schematics, diagrams, functional blocks, cells, design rules, simulation models, net lists, software, test protocols, methods and patterns and other technology owned or used, as at the effective date of a SOW, by RFMD and which RFMD may use or provide to Jazz in the performance of Work under such SOW including all Intellectual Property Rights embodied therein.

 

1.20         “RFMD Confidential Information” shall mean all information identified by RFMD as confidential and disclosed by RFMD to Jazz under the MOU, this Agreement or any SOW.

 

1.21         “RFMD Process Background” shall mean the semiconductor manufacturing processes owned or used, as at the effective date of a SOW, by RFMD and which RFMD uses or provides to Jazz in the performance of Work under such SOW including all Intellectual Property Rights embodied therein.

 

1.22         “SOW” shall mean the separate Statements of Work to be agreed by the Parties from time to time regarding specific development projects agreed to be undertaken by them. Each SOW will be executed by both Parties and will specify the tasks and Work to be performed by each Party, the contributions of engineering and design resources, equipment, supplies, capital and other resources to be made by each Party, the deliverables, Prototypes and other work product to be generated, the development schedule and key milestones, the roles and responsibilities of the Parties to complete the development, the exclusivity, marketing, manufacturing and distribution rights of the Parties, any royalty obligations of the Parties and such other matters as the Parties may agree.

 

1.23         “Subsidiary” shall mean a corporation, company or other entity:

 

(a)           more than fifty percent (50%) of whose outstanding shares or securities (representing the right to vote for the election of directors or other managing authority) are, now or hereafter, owned or controlled, directly or indirectly, by a Party hereto, but such corporation,

 

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company or other entity shall be deemed to be a Subsidiary only so long as such ownership or control exists; or

 

(b)           which does not have outstanding shares or securities, as may be the case in a partnership, joint venture or unincorporated association, but more than fifty percent (50%) of whose ownership interest representing the right to make the decisions for such partnership, joint venture, association or other entity is now or hereafter, owned or controlled, directly or indirectly, by a Party hereto, but such partnership, joint venture, association or other entity shall be deemed to be a Subsidiary only so long as such ownership or control exists.

 

1.24         “Work” shall mean the work carried out under this Agreement or under a SOW.

 

2.             SCOPE OF COOPERATION

 

2.1           During the term of this Agreement, the Parties will work together in a mutually beneficial and cooperative fashion in order to develop advanced semiconductor products, develop new and improved semiconductor manufacturing processes and ICs and create mutually beneficial technological solutions. Each joint development project undertaken by the Parties will be covered by a separate SOW, which shall set forth in reasonable detail the tasks and Work to be performed by each Party, the contributions of employee resources, equipment, supplies, capital, RFMD Background, Jazz Background and other intellectual property and resources to be made by each Party, the deliverables, including the hardware and software, reference designs, technical papers, Prototypes and other work product to be generated from the Work, the payments (if any) to be made by the Parties to each other for non-recurring engineering services, the development schedule and key milestones for the Work and the roles and responsibilities of the Parties with respect to the manufacture, marketing, promotion, advertisement, commercialization, distribution and sale of products created under or resulting from Work under the SOW. Each SOW will describe each Party’s participation in the evaluation, characterization, testing and debugging of Prototypes.

 

2.2           Each Party agrees to use commercially reasonable efforts to perform its responsibilities under each SOW and to allocate sufficient resources to complete the Work in accordance with the relevant specifications and development schedule set forth in such SOW. In the event resource constraints are preventing a timely completion of milestones or Work under a SOW, each Party will make commercially reasonable efforts to address the constraints to ensure completion of the project within the project timeline. To the extent permitted under its existing contractual obligations, each Party will disclose to the other Confidential Information that is relevant to the other in completing Work under a SOW, including all relevant Background necessary to complete the SOW. Either Party may propose changes or modifications to a SOW. Both Parties will timely review any proposed changes to a SOW and will identify impacts of such changes on the development schedule, cost and deliverables under the SOW. Any agreed changes shall be described in a written amendment to the SOW executed by the Parties.

 

2.3           This Agreement shall serve as an overall framework with respect to the joint technology developments of the Parties, and it contains general principles regarding the Parties’ responsibilities, cost sharing and ownership and use of Intellectual Property Rights and Foreground applicable to all projects undertaken under an SOW by the Parties, which principles

 

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may be modified on a project-by-project basis in the SOW, provided such modifications are signed by both Parties. The initial SOW will be negotiated by the Parties as soon as practical after the Effective Date. Additional SOWs may follow from time to time as agreed by the Parties.

 

2.4           RFMD will create two silicon technology development teams, one of which will be located at RFMD’s principal offices and one of which will be located at the Fab (the “CA Team”). RFMD will consult with appropriate personnel at Jazz regarding hiring of personnel for the CA team. The Parties may assign, on a permanent or temporary basis, one or more Jazz employees to the CA Team as agreed by the Parties. As of the Effective Date, it is estimated that the CA Team will consist of approximately seven individuals by the end of 2003. All persons assigned to the CA Team will devote substantially all their efforts to technology development projects under this Agreement and agree to sign a Non-Disclosure Agreement in a form mutually acceptable to the Parties. The CA Team will report to Jazz’s Integration Manager, under the supervision of Jazz’s Director of Research & Development, with secondary reporting to RFMD’s Director of Research & Development. Unless otherwise agreed by the Parties, all members of the CA Team will be employees of RFMD and RFMD will be solely responsible for payment of all salaries, benefits and other compensation and deposit of all income, unemployment, FICA and other taxes with respect to such persons. The CA Team will abide by, and be subject to any and all Jazz Security and Safety Policies.

 

2.5           Jazz will provide the CA Team with office and lab space, office and communications equipment, personal computers and software, supplies and administrative and technical support. Jazz will bill RFMD monthly for such services at a rate to be mutually agreed to cover Jazz’s standard cost of providing such facilities and services. To the extent reasonably necessary, Jazz will make available its existing Process technology, engineering personnel and other resources only as provided in each SOW at a rate to be mutually agreed upon within the SOW. Jazz will also provide, without charge, sufficient access to its Fab, test equipment, computer-aided design systems, laboratories and other facilities and associated equipment to enable the CA Team to complete Work under each SOW. All projects involving Process developments will follow standard development procedures implemented by Jazz, and the actual Process development function will continue to be the primary responsibility of Jazz’s process engineers. Jazz will allow the CA Team to participate in all relevant meetings and discussions concerning Process developments covered by a SOW and to engage in all related aspects of Process development, including process design, starting and monitoring wafer lots, device characterization, modeling and testing, except to the extent related to or involving third party confidential information.

 

2.6           In the event a member of the CA Team discloses to RFMD confidential information regarding Jazz, or Jazz customers, other than in connection with a SOW or this Agreement, RFMD agrees to promptly notify Jazz of such disclosure and to take appropriate reasonable action regarding such member of the CA Team. In the event an employee of Jazz or any other person with access to the Fab discloses to Jazz confidential information regarding RFMD, or RFMD customers, other than in connection with a SOW or this Agreement, Jazz agrees to promptly notify RFMD of such disclosure and to take appropriate reasonable action regarding such person. Nothing contained in this Section 2.6 shall limit the rights and obligations of the Parties under Section 3 of this Agreement. The Parties acknowledge and agree

 

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that the notices provided under this Section 2.6 shall not be an admission of any breach under Section 3 or any other provision of this Agreement, and neither the fact nor substance of such notice shall be admissible as evidence against the notifying Party.

 

2.7           Both Parties agree not to directly or actively recruit, divert or solicit the employment of either Party’s employees during the term of this Agreement and for a period of twelve (12) months thereafter.

 

2.8           Each SOW will address any exclusivity provisions with respect to the development, manufacturing and marketing of any products resulting from the Work under each SOW. If exclusivity is not specifically addressed in a SOW, then subject to the other terms of this Agreement, the following exclusivity provisions shall prevail:

 

2.8.1        RFMD shall exclusively own all Non-Process Foreground, including the Design of all ICs fabricated for it at the Fab, and shall retain the exclusive right to make, have made, use, import, market, offer for sale and sell ICs based on or derived, in whole or in part, from such Designs. RFMD may not use the improved Process Foreground fully funded by RFMD under Section 2.8.3, for manufacturing at any internal or foundry site other than a Jazz site, until [. . . *** . . .] from the Risk Production at the Fab of such new or improved Process, and RFMD agrees that if RFMD asserts “have made” rights under this Section 2.8.1 at a location other than a Jazz location thereafter, RFMD shall do so only in full accordance with RFMD’s obligation to give JAZZ the first right of refusal to supply all RFMD silicon demand, provided JAZZ is competitive in pricing, technology, quality and delivery, as set forth in the Wafer Supply Agreement entered into between RFMD and JAZZ contemporaneously herewith; provided that, in the event RFMD rightfully asserts its “have made” rights, Jazz shall grant a royalty-free, non-transferable, reasonable license to a third party foundry authorized by RFMD to use the appropriate Process for the express, limited purpose of manufacturing ICs for RFMD.

 

2.8.2        Jazz shall exclusively own all Process Foreground related to development of CMOS and SiGe Processes arising from development projects, or internally funded by Jazz or developed independently from an SOW,  and will be free to offer foundry services to any Person, including RFMD, for the use of such improved Processes.

 

2.8.3        Jazz shall exclusively own all Process Foreground, and new and improved Process Foreground arising from development projects under a SOW that are funded solely by RFMD, however Jazz hereby agrees that RFMD shall have the [. . . *** . . .] right to have ICs fabricated for it at the Fab under such new or improved Process; provided, that RFMD issues a binding purchase orders for at least [. . . *** . . .] wafers within [. . . *** . . .] from the Risk Production of such new or improved Process. RFMD needs to purchase minimum annual quantities of [. . . *** . . .] wafers based on such new or improved Process thereafter to maintain the [. . . *** . . .] right, otherwise, Jazz will be free to provide foundry services to any Person, including RFMD, for the use of such new or improved Process.

 

2.8.4        Jazz shall exclusively own all new or improved Processes arising from development projects under a SOW that are funded jointly by Jazz and RFMD. However, if RFMD funds greater than or equal to [. . . *** . . .] percent ([. . . *** . . .]%), but less than [. . . *** . . .] ([. . . *** . . .] %) of the project, RFMD shall have the [. . . *** . . .] right to have

 

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ICs fabricated for it at the Fab under such new or improved Process Foreground for a period of [. . . *** . . .] from the Risk Production of such new or improved Process Foreground. Thereafter, Jazz will be free to provide foundry services to any Person, including RFMD, for the use of such new or improved Process. Jazz agrees that it shall not increase funding to a development project under a SOW without RFMD’s prior written consent.

 

2.8.5        Without regard to whether RFMD has or retains exclusive rights to have ICs fabricated for it at the Fab using a new or improved Process Foreground under Sections 2.8.2 – 2.8.4, RFMD will be provided access to such new or improved Process Foreground on terms no less favorable than those provided to any other customer of Jazz, with the exclusion of Conexant or its affiliates or spin-offs under existing wafer supply agreements.

 

3.             CONFIDENTIAL INFORMATION

 

3.1           The handling of all Confidential Information, including that Confidential Information transferred under the MOU and to be transferred under the Agreement and each SOW, shall be in accordance with this Section 3. Confidential Information previously provided under the MOU or disclosed by the Parties prior to the Effective Date shall be treated as if disclosed under this Agreement.

 

3.2           For a period of five (5) years from the date of disclosure of Confidential Information, the receiving Party agrees to use the same degree of care and discretion to avoid disclosure, publication or dissemination of Confidential Information ou