AMD 2004 Annual Report Download - page 295

13.2 Meeting Topics. At these Quarterly meetings, the Parties will, among other things: (a) review the status and overall effectiveness of FASL’s
marketing activities and, if applicable, the status and overall effectiveness of FASL–AMD joint marketing activities undertaken in accordance with Section
11.2.2; (b) discuss potential Leads and actual or potential Customer support issues; (c) discuss Customer and Channel Partner input and feedback regarding
Products or proposed FASL new product offerings; (d) evaluate the general effectiveness of AMD’s marketing activities in relation to FASL’s then-current
Marketing Plan; (e) evaluate the performance of AMD’s Channel Partners; and (f) discuss other issues and concerns raised by the Parties. In no event will joint
meetings in which FASL and two or more distributors or sales representatives participate (including AMD and Fujitsu), contain a discussion of any distributor’s
independent sales activities, Product pricing or allocation decisions. Information obtained by FASL from AMD with regard to AMD’s independent sales
activities, Product pricing or allocation shall be subject to the obligations set forth in Section 16, and shall not be disclosed to Fujitsu or to any other Entity or
person, except as otherwise expressly permitted hereunder, including without limitation as permitted under Section 9.1.
13.3 Not Corrective Action. The Parties acknowledge and agree that (a) these quarterly meetings will not be used as a forum in which to institute the
commencement of corrective action procedures against AMD in the event that FASL believes that AMD’s sales performance is unsatisfactory, and (b) FASL
may only take corrective action against AMD on the basis of the factors, and in accordance with the procedures, set forth in Section 14 below.
14. DISTRIBUTOR CORRECTIVE ACTION
14.1 Initiation of Process. In the event that FASL reasonably determines that AMD’s sales performance (including as such performance may be affected
by the sales performance of its Channel Partners), with respect to a Customer (or multiple Customers) in the AMD Territory, or with respect to an AMD Account
or an AMD PRC Customer, is not satisfactory based on:
14.1.1 AMD’s actual market share (by dollar and product line) versus FASL’s market share goals, as set forth in FASL’s then-current Marketing
Plan, taking into account current market conditions;
14.1.2 Revenue levels forecasted by FASL in its then-current six-quarter operating plan, and AMD’s substantial variance from such forecasted
revenues, taking into account current market conditions;
14.1.3 AMD’s level of design win activity, measured against FASL’s reasonable opinion of the appropriate level of activity based on current market
conditions; or
14.1.4 Reductions in the level of AMD sales coverage, measured against FASL’s reasonable opinion of the appropriate level of sales coverage based
on current market conditions; then FASL shall have the right to institute the procedures regarding AMD corrective action set forth in Section 14.2 below.
24
Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as ****. A complete version of the exhibit has been filed separately with the Securities and Exchange Commission.
Source: ADVANCED MICRO DEVIC, 10-K, March 01, 2005