AMD 1994 Annual Report Download - page 245

parties will negotiate and mutually agree upon any adjustments to the price and
delivery schedules as well as charges for retooling costs if warranted by such
modifications.
3.6 If Die fail to meet the Qualification Requirements, and in AMD's
reasonable opinion such failure appears material, AMD may request TSMC to stop
production. If TSMC is unable to correct such failures within a reasonable time
not to exceed three (3) months, AMD may cancel orders for such production. AMD
will notify TSMC in writing of its intention to suspend or cancel such orders
and will include any substantiating data. AMD will not be liable for any charges
for suspension or cancellation of such orders, provided such cancellation was
warranted under the circumstances.
3.7 The Wafers with tested Die are to be provided to AMD test specifications
and methodology. AMD will provide information regarding testing, equipment, and
methods and will allow the use of AMD test tapes.
3.8 AMD may stop production for any or all AMD Products by giving notice to
TSMC. TSMC will stop production following completion of the process steps at
which the appropriate Wafers reside at the time of notification. As long as the
production is stopped without fault of TSMC, AMD will pay TSMC for all such
Wafers started prior to TSMC receiving such notice. Prices for such work-in-
progress (WIP) Wafers will be equitably prorated based on the stage of
production of the Wafers. In no event will the WIP Wafer price exceed the
completed Wafer price as given in Section 8.1. Upon payment, the WIP will
become the property of AMD and will be delivered to AMD immediately upon
request. The parties will mutually agree as to the best course of stopping
production in accordance with good manufacturing practice to prevent waste. This
Section 3.8 will not affect AMD's minimum purchase commitment of Section 3.2.2.
3.9 TSMC agrees it will migrate AMD's Die to 8" Wafers during the
[CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION].
4. ON-SITE INSPECTION AND VENDOR INFORMATION
4.1 AMD representatives shall be allowed to visit TSMC's manufacturing
facility during normal working hours upon reasonable notice to TSMC.
4.2 At AMD's request, TSMC will allow AMD to perform an audit of TSMC's
manufacturing facility for the purpose of verifying proper production of AMD
Products. TSMC will provide AMD with process control information, including but
not limited to: process and electrical test yield results, current process
specifications and conformance to specifications; calibration schedules and logs
for equipment; environmental monitor information for air, gases and DI water;
documentation of operator traceability information, and TSMC's trouble reports;
all to be in accordance with the Qualification Requirements .
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Source: ADVANCED MICRO DEVIC, 10-K, March 07, 1995