AMD 2002 Annual Report Download - page 253

SECTION 5—AMD FUNDING CONTRIBUTIONS AND ROYALTY PAYMENTS
5.1 AMD shall pay to IBM for the Term a total of *** dollars ($***) for its respective share of the costs of the Process Development Projects; such
payments shall be made as follows (in *** of US dollars):
1Q03 2Q 3Q 4Q 1Q04 2Q 3Q 4Q 1Q05 2Q 3Q 4Q
AMD *** *** *** *** *** *** *** *** *** *** *** ***
Such payments shall be made on the fifteenth of the first month of each calendar year quarter. This Agreement will serve as an invoice for such
payments.
5.2 AMD shall be liable for interest on any overdue payment under this Agreement commencing on the date such payment becomes due at an annual
rate equal to eighteen percent (18%) per year. If such interest rate exceeds the maximum legal rate in the jurisdiction where a claim therefor is being
asserted, the interest rate shall be reduced to such maximum legal rate.
5.3 IBM shall apply the payments of Section 5.1 above towards Process Development Project costs and not for any license rights granted by any Party
to any other Party for Background Know-How. Notwithstanding Section 5.1, AMD shall be required to share the incremental costs of any changes
in scope in the Process Development Projects agreed to pursuant to Section 14.
5.4 Moreover, AMD shall pay IBM a royalty on all ASIC Products, at the rate of *** percent (***%) of the Net Selling Price of each unit of ASIC
Product sold, leased or otherwise transferred directly or indirectly prior to five (5) years from ***; provided, however, that in the case of Specific
Results from the *** all royalties for ASIC Products utilizing such Specific Results shall be *** percent (***%). Such royalty payments are to be
paid by AMD for each ASIC Product sold, leased or otherwise transferred at the time of such sale, lease or transfer to a Third party. For clarity, such
royalty obligation does not extend to transactions between or among the Parties and such Wholly Owned Subsidiaries or Related Subsidiaries that
do not involve a Third Party. AMD shall pay IBM all royalties owed within forty-five (45) days after the end of each calendar quarter. AMD shall
provide a royalty report to IBM within forty-five (45) days after the end of each calendar quarter. All payments shall be made by wire transfer to the
IBM account listed in Section 13.1.1 below, in U.S. dollars. The following information shall be included in the wire detail:
Company Name
Reason for Payment
License Reference No. L024381B
*** Confidential information omitted and filed separately with the Securities and Exchange Commission.
Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003