-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UIA4qBd1VUN+2fQjMQLzgr9AYWR7y10QKdqkzYkzqFCifWX7J6+QsG6p+rhuOCLM po9U8K4qCabfsfTIpWIVUw== 0000950131-00-002850.txt : 20000428 0000950131-00-002850.hdr.sgml : 20000428 ACCESSION NUMBER: 0000950131-00-002850 CONFORMED SUBMISSION TYPE: S-4/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20000427 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHIPPAC INTERNATIONAL CO LTD CENTRAL INDEX KEY: 0001097583 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 660573152 STATE OF INCORPORATION: D8 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4/A SEC ACT: SEC FILE NUMBER: 333-91641 FILM NUMBER: 611135 BUSINESS ADDRESS: STREET 1: 3151 CORONADO DR CITY: SANTA CLARA STATE: CA ZIP: 95054 BUSINESS PHONE: 4084864900 MAIL ADDRESS: STREET 1: CRAIGMUIR CHAMBERS, ROAD TOWN STREET 2: TORTOLA CITY: BRITISH VIRGIN ISLAN STATE: D8 ZIP: 00000 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHIPPAC INC CENTRAL INDEX KEY: 0001093779 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 770463048 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4/A SEC ACT: SEC FILE NUMBER: 333-91641-01 FILM NUMBER: 611136 BUSINESS ADDRESS: STREET 1: 3151 CORONADO DR CITY: SANTA CLARA STATE: CA ZIP: 95054 BUSINESS PHONE: 4084865900 MAIL ADDRESS: STREET 1: 3151 CORONADO DRIVE CITY: SANTA CLARA STATE: CA ZIP: 95054 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHIPPAC LUXEMBOURG SARL CENTRAL INDEX KEY: 0001097578 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 000000000 STATE OF INCORPORATION: N4 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4/A SEC ACT: SEC FILE NUMBER: 333-91641-02 FILM NUMBER: 611137 BUSINESS ADDRESS: STREET 1: 3151 CORONADO DR CITY: SANTA CLARA STATE: CA ZIP: 95054 BUSINESS PHONE: 4084864900 MAIL ADDRESS: STREET 1: L2453 LUXEMBOURG, 16, RUE EUGENE RUPPERT CITY: LUXEMBOURG STATE: N4 ZIP: 00000 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHIPPAC LIQUIDITY MANAGEMENT LIMITED LIABILITY CO CENTRAL INDEX KEY: 0001097579 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 980209814 STATE OF INCORPORATION: K5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4/A SEC ACT: SEC FILE NUMBER: 333-91641-03 FILM NUMBER: 611138 BUSINESS ADDRESS: STREET 1: 3151 CORONADO DR CITY: SANTA CLARA STATE: CA ZIP: 95054 BUSINESS PHONE: 4084864900 MAIL ADDRESS: STREET 1: 9700 SZOMBATHLEY STREET 2: VARKONYIV.15 CITY: HUNGARY STATE: K5 ZIP: 00000 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHIPPAC KOREA CO LTD CENTRAL INDEX KEY: 0001097580 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 980209695 STATE OF INCORPORATION: M5 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4/A SEC ACT: SEC FILE NUMBER: 333-91641-04 FILM NUMBER: 611139 BUSINESS ADDRESS: STREET 1: 3151 CORONADO DR CITY: SANTA CLARA STATE: CA ZIP: 95054 BUSINESS PHONE: 4084864900 MAIL ADDRESS: STREET 1: SAN 136-1, AMI-RI, BUBAL-CUB, ICHON-SI STREET 2: KYOUNG KI-DO CITY: 467-701 KOREA STATE: M5 ZIP: 00000 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHIPPAC BARBADOS LTD CENTRAL INDEX KEY: 0001097581 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 980209821 STATE OF INCORPORATION: C8 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4/A SEC ACT: SEC FILE NUMBER: 333-91641-05 FILM NUMBER: 611140 BUSINESS ADDRESS: STREET 1: 3151 CORONADO DR CITY: SANTA CLARA STATE: CA ZIP: 95054 BUSINESS PHONE: 4084864900 MAIL ADDRESS: STREET 1: CHANCERY HOUGE STREET 2: HIGHSTREET CITY: BRIDGETOWN, BARBADOS STATE: C8 ZIP: 00000 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHIPPAC LTD CENTRAL INDEX KEY: 0001097582 STANDARD INDUSTRIAL CLASSIFICATION: SEMICONDUCTORS & RELATED DEVICES [3674] IRS NUMBER: 980209699 STATE OF INCORPORATION: D8 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4/A SEC ACT: SEC FILE NUMBER: 333-91641-06 FILM NUMBER: 611141 BUSINESS ADDRESS: STREET 1: 3151 CORONADO DR CITY: SANTA CLARA STATE: CA ZIP: 95054 BUSINESS PHONE: 4084864900 MAIL ADDRESS: STREET 1: CRAIGMUIR CHAMBERS, ROAD TOWN STREET 2: TORTOLA CITY: BRITISH VIRGIN ISLAN STATE: D8 ZIP: 00000 S-4/A 1 AMENDMENT NO. 5 TO FORM S-4 As filed with the Securities and Exchange Commission on April 27, 2000 Registration No. 333-91641 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------- AMENDMENT No. 5 to FORM S-4 REGISTRATION STATEMENT Under The Securities Act of 1933 -------------- ChipPAC International Company Limited ChipPAC, Inc. ChipPAC Liquidity Management Hungary Limited Liability Company ChipPAC Luxembourg S.a.R.L. ChipPAC Korea Company Ltd. ChipPAC Limited ChipPAC (Barbados) Ltd. (Exact name of registrants as specified in their charters) British Virgin Islands 3674 66-0573152 California 3674 77-0463-48 Hungary 3674 98-0209814 Luxembourg 3674 98-0209817 Republic of Korea 3674 98-0209695 British Virgin Islands 3674 98-0209699 Barbados 3674 98-0209821 (State or other (Primary Standard (I.R.S. Employer Jurisdiction of Industrial Classification Code) Identification No.) incorporation or organization) -------------- 3151 Coronado Drive, Santa Clara, California 95054 Telephone: (408) 486-5900 (Address, including zip code, and telephone number, including area code of registrants' principal executive offices) -------------- Dennis P. McKenna President & Chief Executive Officer ChipPAC, Inc. 3151 Coronado Drive, Santa Clara, California 95054 (408) 486-5900 (Name, address, including zip code, and telephone number, including area code, of agent for service) -------------- Copies of all communications, including communications sent to agent for service, should be sent to: Eva Herbst Davis Kirkland & Ellis 777 South Figueroa Street Los Angeles, California 90017 (213) 680-8400 Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. -------------- If any of the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. [_] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] -------------- The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 20. Indemnification of Directors and Officers. ChipPAC International Company Limited As in most United States jurisdictions, the board of directors of a British Virgin Islands company is charged with the management and affairs of the company, and subject to any limitations to the contrary in the Memorandum of Association of a company, the Board of Directors is entrusted with the power to manage the business and affairs of the company (hereinafter, the "Issuer"). In most United States jurisdictions, directors owe a fiduciary duty to a company and its shareholders, including a duty of care, pursuant to which directors must properly apprise themselves of all reasonably available information, and a duty of loyalty, pursuant to which they must protect the interests of the company and refrain from conduct that injures the company or its shareholders or that deprives the company or its shareholders of any profit or advantage. Many United States jurisdictions have enacted various statutory provisions which permit the monetary liability of directors to be eliminated or limited. Under British Virgin Islands law, liability of a director or officer of a company director is, for the most part, limited to cases of willful malfeasance in the performance of duties or to cases where such director or officer, as applicable, has not acted honestly, in good faith and with a view to the company's best interests. Under its Memorandum of Association, the Issuer is authorized to indemnify any person who is made or threatened to be made a party to a legal or administrative proceeding by virtue of being a director, officer or liquidator of the Issuer, provided such person acted honestly and in good faith and with a view to the best interests of the Issuer and, in the case of a criminal proceeding, such person had no reasonable cause to believe that his conduct was unlawful. The Issuer's Memorandum of Association also permits it to indemnify any director, officer or liquidator of the Issuer who was successful in any proceeding against expenses and judgments, fines and amounts paid in settlement and reasonably incurred in connection with the proceeding, where such person met the standard of conduct described in the preceding sentence. The Issuer has provisions in its Memorandum of Association that insure or indemnify, to the full extent allowed by the laws of the Territory of the British Virgin Islands, directors, officers, employees, agents or persons serving in similar capacities in other enterprises at the request of the Issuer. The Issuer may obtain a directors' and officers' insurance policy. ChipPAC, Inc. ChipPAC, Inc. ("ChipPAC") is incorporated under the laws of the State of California. Section 317 of the General Corporation Law of the State of California provides that a California corporation may indemnify any person who is, or is threatened to be made, party to any proceeding (other than an action by or in the right of the corporation to procure a judgment in its favor) by reason of the fact that the person is or was an agent of the corporation, against expenses, judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with the proceeding if that person acted in good faith and in a manner the person reasonably believed to be in the best interests of the corporation and, in the case of a criminal proceeding, had no reasonable cause to believe the conduct of the person was unlawful. A corporation has power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was an agent of the corporation, against expenses actually and reasonably incurred by that person in connection with the defense or settlement of the action if the person acted in good faith, in a manner the person believed to be in the best interests of the corporation and its shareholders. Under Article V of ChipPAC's Amended and Restated By-Laws, ChipPAC will indemnify any person who was or is a party, or is threatened to be made a party, to any proceeding (other than an action by or in the right of this corporation) by reason of the fact that such person is or was an agent of ChipPAC, against expenses, II-1 judgments, fines, settlements or other amounts actually and reasonably incurred in connection with such proceeding if that person acted in good faith and in a manner that person reasonably believed to be in the best interests of ChipPAC and, in the case of a criminal proceeding, if that person had no reasonable cause to believe his conduct was unlawful. Such right of indemnification will be a contract right and will not be exclusive of any other right which such directors, officers or representatives may have or hereafter acquire under any contract or otherwise. For purposes of the foregoing discussion, "agent" means any person who is or was a director, officer, employee or other agent of ChipPAC, or is or was serving at the request of ChipPAC as a director, officer, employee, or agent of another foreign or domestic corporation, limited liability company, partnership, joint venture, trust or other enterprise, or was a director, officer, employee or agent of a foreign or domestic corporation which was a predecessor corporation of ChipPAC or of another enterprise at the request of such predecessor corporation In addition, Section 204 of the General Corporation Law of the State of California allows a corporation to eliminate the personal liability of a director of a corporation to the corporation or to any of its stockholders for monetary damages for a breach of fiduciary duty as a director, provided, however, that: (A) such a provision may not eliminate or limit the liability of directors: (1) for acts or omissions that involve intentional misconduct or a knowing and culpable violation of law; (2) for acts or omissions that a director believes to be contrary to the best interests of the corporation or its shareholders or that involve the absence of good faith on the part of the director; (3) for any transaction from which a director derived an improper personal benefit; (4) for acts or omissions that show a reckless disregard for the director's duty to the corporation or its shareholders in circumstances in which the director was aware, or should have been aware, in the ordinary course of performing a director's duties, of a risk of serious injury to the corporation or its shareholders; (5) for acts or omissions that constitute an unexcused pattern of inattention that amounts to an abdication of the director's duty to the corporation or its shareholders; (6) under Section 310; or (7) under Section 316; (B) no such provision will eliminate or limit the liability of a director for any act or omission occurring prior to the date when the provision becomes effective; and (C) no such provision will eliminate or limit the liability of an officer for any act or omission as an officer, notwithstanding that the officer is also a director or that his or her actions, if negligent or improper, have been ratified by the directors. Article IV of ChipPAC's Amended and Restated Articles of Incorporation includes a provision which eliminates directors' personal liability to the full extent permitted under the General Corporation Law of the State of California. ChipPAC maintains a policy of directors and officers liability insurance covering certain liabilities incurred by its directors and officers in connection with the performance of their duties. ChipPAC (Barbados) Ltd. Paragraph 10 of ChipPAC (Barbados) Ltd.'s ("ChipPAC Barbados") By-Laws provides for the indemnification of its officers and directors (and such persons' executors and administrators) against any and all judgments, fines, amounts paid in settlement and reasonable expenses, including attorneys' fees, incurred by such person in connection with any claim, action, suit or proceeding, whether civil, criminal, administrative or investigative by reason of the fact that such person is or was a director or officer of ChipPAC Barbados, or is or II-2 was serving at the request of ChipPAC Barbados as a director or officer, of any other corporation, partnership, joint venture, trust, enterprise or organization, except with respect to any matter for which indemnification would be void pursuant to the Companies Act, 1982 of Barbados (the "Companies Act"). Under the Companies Act, indemnification of the officers and directors of ChipPAC Barbados against any liability which would attach by reason of any contract entered into or act or thing done or omitted to be done by them in performance of their office or in any way in the discharge of their duties, if the same happens through their not acting in good faith and in the best interest of ChipPAC Barbados is void. ChipPAC Limited As in most United States jurisdictions, the board of directors of a British Virgin Islands company is charged with the management and affairs of the company, and subject to any limitations to the contrary in the Memorandum of Association of a company, its Board of Directors is entrusted with the power to manage the company's business and affairs. In most United States jurisdictions, directors owe a fiduciary duty to the company and its shareholders, including a duty of care, pursuant to which directors must properly apprise themselves of all reasonably available information, and a duty of loyalty, pursuant to which they must protect the interests of the company and refrain from conduct that injures the company or its shareholders or that deprives the company or its shareholders of any profit or advantage. Many United States jurisdictions have enacted various statutory provisions which permit the monetary liability of directors to be eliminated or limited. Under British Virgin Islands law, liability of a director or officer of a company is basically limited to cases of willful malfeasance in the performance of his duties or to cases where the director has not acted honestly and in good faith and with a view to the best interests of the company. Under its Memorandum of Association, ChipPAC Limited is authorized to indemnify any person who is made or threatened to be made a party to a legal or administrative proceeding by virtue of being a director, officer or liquidator of ChipPAC Limited, provided such person acted honestly and in good faith and with a view to the best interests of ChipPAC Limited and, in the case of a criminal proceeding, such person had no reasonable cause to believe that his conduct was unlawful. ChipPAC Limited's Memorandum of Association also permits it to indemnify any director, officer or liquidator who was successful in any proceeding against expenses and judgments, fines and amounts paid in settlement and reasonably incurred in connection with the proceeding, where such person met the standard of conduct described in the preceding sentence. ChipPAC Limited has provisions in its Memorandum of Association that insure or indemnify, to the full extent allowed by the laws of the Territory of the British Virgin Islands, directors, officers, employees, agents or persons serving in similar capacities in other enterprises at the request of ChipPAC Limited. ChipPAC Limited may obtain a directors' and officers' insurance policy. ChipPAC Korea Company Ltd. The Republic of Korea Commercial Act (the "Commercial Act") governs the liability relationship between companies and their officers and directors in both joint stock companies (chusik hoesa) and limited liability companies (yuhan hoesa). Articles 399 and 400 of the Commercial Act describe the circumstances in which officers and directors may be held liable to the company, while Article 401 of the Commercial Act outlines the circumstances in which officers and directors may be held liable to third parties. The latter provides that third parties which are harmed by a wilful act or gross negligence of an officer or director may have recourse against both the applicable officer or director and the company. In the event that third parties are harmed through the mere negligence of an officer or director, such third party may only have recourse against the company. In the event the company incurs damages as a result of the negligence of its directors and officers, it may the seek indemnification from the negligent party. The organizational documents of ChipPAC Korea Company Ltd. ("ChipPAC Korea") are silent as to the issue of indemnification of officers and directors. In addition, ChipPAC Korea, like many Korean companies, does not carry directors and officers liability insurance. II-3 ChipPAC Luxembourg S.a.R.L. Under Luxembourg law, civil liability of directors both to ChipPAC Luxembourg S.a.R.L. ("ChipPAC Luxembourg") and to third parties is generally considered to be a matter of public policy. It is possible that Luxembourg courts would declare void an explicit or even implicit contractual limitation on directors' liability to ChipPAC Luxembourg. ChipPAC Luxembourg, however, can validly agree to indemnify its directors against the consequences of liability actions brought by third parties (including shareholders if such shareholders have personally suffered a damage which is independent of and distinct from the damage caused to the company). Under Luxembourg law, an employee of ChipPAC Luxembourg can only be liable to ChipPAC Luxembourg for damages brought about by his or her willful acts or gross negligence. Any arrangement providing for the indemnification of officers against claims of ChipPAC Luxembourg would be contrary to public policy. Employees are liable to third parties under general tort law and may enter into arrangements with ChipPAC Luxembourg providing for indemnification against third party claims. Under Luxembourg law, an indemnification agreement can never cover a willful act or gross negligence. ChipPAC Luxembourg's Articles of Incorporation are silent as to the issue of indemnification of its officers and directors. ChipPAC Liquidity Management Hungary Limited Liability Company The organizational documents of ChipPAC Liquidity Management Hungary Limited Liability Company ("ChipPAC Hungary") are silent as to the issue of indemnification of the managing director. ChipPAC Hungary has no other officers or directors. Therefore, in the event any case arises which involves the liability of a managing director, such case must be settled in accordance with the applicable provisions of the Hungarian Companies Act (the "Companies Act") and the Hungarian Civil Code (the "Civil Code"). Under the Companies Act, a managing director must conduct himself in respect of the management of a company with "increased care," as opposed to the standard of "general care" which is prescribed by the Civil Code. A managing director may be held liable in the event of a culpable breach of any provision of the Companies Act, a company's Deed of Foundation or any validly enacted resolutions of the company's Founder. If the aforementioned duty of care is breached, a managing director may be held liable under the rules of the Civil Code for any damages to the company where such managing director's actions were (i) in contravention of Hungarian law, (ii) caused damage to the company and (iii) were not undertaken with the requisite degree of care specified in the Companies Act. Enforcement of liability claims against a managing director is in the sole discretion of the Founder. A Founder may exercise his or her rights against a managing director within one year of the company's deletion from the Company Registry. A managing director is only obliged to compensate the company for damages, and is not liable to third parties for acts that are within the scope of his or her role or responsibility as a managing director. Third parties may only seek damages from the company. Should the company be required to pay damages to a third party for acts of the managing director, however, it may have recourse against the managing director for damages incurred as a result of third party claims. II-4 Item 21. Exhibits and Financial Statement Schedules. (a) Exhibits.
Exhibit No. Description ------- ----------- --- 2.1 Agreement and Plan of Recapitalization and Merger, dated as of March 13, 1999, by and among Hyundai Electronics Industries Co., Ltd., Hyundai Electronics America, ChipPAC, Inc. and ChipPAC Merger Corp.* 2.2 First Amendment to Agreement and Plan of Recapitalization and Merger, dated as of June 16, 1999 by and among Hyundai Electronics Industries Co., Ltd., Hyundai Electronics America, ChipPAC, Inc. and ChipPAC Merger Corp.* 2.3 Second Amendment to Agreement and Plan of Recapitalization and Merger, dated as of August 5, 1999, by and among Hyundai Electronics Industries Co., Ltd., Hyundai Electronics America, ChipPAC, Inc. and ChipPAC Merger Corp.* 3.1 Amended and Restated Articles of Incorporation of ChipPAC, Inc.* 3.2 Amended and Restated By-Laws of ChipPAC, Inc.* 3.3 Memorandum of Association of ChipPAC International Company Limited (formerly known as ChipPAC Finance Limited).* 3.4 Articles of Association of ChipPAC International Company Limited (formerly known as ChipPAC Finance Limited).* 3.5 Articles of Incorporation of ChipPAC (Barbados) Ltd.* 3.6 By-Law No. 1 of ChipPAC (Barbados) Ltd.* 3.7 Memorandum of Association of ChipPAC Limited.* 3.8 Articles of Association of ChipPAC Limited.* 3.9 Articles of Incorporation of ChipPAC Luxembourg S.a.R.L.* 3.10 Deed of Foundation of ChipPAC Liquidity Management Hungary Limited Liability Company.* 3.11 Policy and Operating Guidelines of ChipPAC Liquidity Management Hungary Limited Liability Company (abbreviated as ChipPAC Ltd.)* 3.12 Articles of Incorporation of ChipPAC Korea Company Ltd.* 4.1 Purchase Agreement, dated as of July 22, 1999, by and among ChipPAC International Limited, ChipPAC Merger Corp., Credit Suisse First Boston Corporation and Donaldson, Lufkin & Jenrette Securities Corporation (executed in counterpart on August 5, 1999 by ChipPAC (Barbados) Ltd., ChipPAC Limited, ChipPAC Korea Company Ltd., ChipPAC Luxembourg S.a.R.L. and ChipPAC Liquidity Management Hungary Limited Liability Company).* 4.2 Indenture, dated as of July 29, 1999, by and among ChipPAC International Limited, ChipPAC Merger Corp. and Firstar Bank of Minnesota, N.A., as trustee.* 4.3 First Supplemental Indenture, dated as of August 5, 1999, by and among ChipPAC International Company Limited, ChipPAC, Inc. and Firstar Bank of Minnesota, N.A., as trustee.* 4.4 12 3/4% Senior Subordinated Notes Due 2009.* 4.5 Form of Series B 12 3/4% Senior Subordinated Notes Due 2009.*
II-5
Exhibit No. Description ------- ----------- --- 4.6 Registration Rights Agreement, dated as of July 29, 1999, by and among ChipPAC International Limited, ChipPAC Merger Corp., and Credit Suisse First Boston Corporation and Donaldson, Lufkin & Jenrette Securities Corporation, as Initial Purchasers.* 5.1 Opinion of Kirkland & Ellis.* 8.1 Opinion of Kirkland & Ellis.* 10.1 Credit Agreement, dated as of August 5, 1999, by and among ChipPAC International Company Limited, ChipPAC, Inc., the Lenders listed therein and Credit Suisse First Boston, as Administrative Agent, Sole Lead Manager and Collateral Agent.* 10.2 Guaranty, dated as of August 5, 1999, by and among ChipPAC, Inc. and certain subsidiaries of ChipPAC, Inc., in favor of Credit Suisse First Boston.* 10.3 Subsidiary Guaranty Agreement, dated as of August 5, 1999, by and among ChipPAC Korea Company Ltd., ChipPAC Limited, ChipPAC (Barbados) Ltd., ChipPAC Luxembourg S.a.R.L., ChipPAC Liquidity Management Hungary Limited Liability Company and ChipPAC International Company Limited, in favor of Firstar Bank of Minnesota, N.A.* 10.4 Amended and Restated Shareholders Agreement, dated as of August 5, 1999, by and among ChipPAC, Inc. the Hyundai Group (as defined therein), the Bain Group (as defined therein), the SXI Group (as defined therein), Intel Corporation, ChipPAC Equity Investors LLC, and Sankaty High Yield Asset Partners, L.P.* 10.5 Amended and Restated Registration Agreement, dated as of August 5, 1999, by and among ChipPAC, Inc., the Hyundai Shareholders (as defined therein), the Bain Shareholders (as defined therein), the SXI Shareholders (as defined therein), Intel Corporation, ChipPAC Equity Investors LLC, and Sankaty High Yield Asset Partners, L.P.* 10.6 Transition Services Agreement, dated as of August 5, 1999, by and among Hyundai Electronics Industries Co., Ltd., Hyundai Electronics America, ChipPAC, Inc., ChipPAC Korea Company Ltd., Hyundai Electronics Company (Shanghai) Ltd., ChipPAC Assembly and Test (Shanghai) Company Ltd., ChipPAC Barbados Limited and ChipPAC Limited.* 10.7 Lease Agreement, dated as of June 30, 1998, by and between Hyundai Electronics Industries Co., Ltd. and ChipPAC Korea Ltd.* 10.7.1 Amendment Agreement, dated September 30, 1998, to Lease Agreement, dated June 30, 1998, by and between Hyundai Electronics Industries Co., Ltd. and ChipPAC Korea Ltd.* 10.7.2 Amendment Agreement 2, dated September 30, 1999, to Lease Agreement, dated June 30, 1998, by and between Hyundai Electronics Industries Co., Ltd. and ChipPAC Korea Ltd.* 10.8 Agreement Concerning Supply of Utilities, Use of Welfare Facilities and Management Services for Real Estate, dated as of June 30, 1998, by and between Hyundai Electronics Industries Co., Ltd. and ChipPAC Korea Ltd.* 10.9 Service Agreement, dated as of August 5, 1999, by and between Hyundai Electronics Industries Co. Ltd. and ChipPAC Limited.+*
II-6
Exhibit No. Description ------- ----------- 10.10 Sublease Agreement, dated as of May 1, 1998, by and between Hyundai Electronics America and ChipPAC, Inc.* 10.11 Patent Sublicense Agreement, dated as of August 5, 1999, by and between Hyundai Electronics Industries Co., Ltd. and ChipPAC Limited.* 10.12 TCC License Agreement, dated December 22, 1998, between Tessera Inc., the Tessera Affiliates (as defined therein), ChipPAC, Inc. and the Licensee Affiliates (as defined therein).+* 10.12.1 Letter Agreement, dated July 15, 1999, by and among ChipPAC, Inc., Hyundai Electronics America, ChipPAC Limited and Tessera, Inc.* 10.13 Materials Agreement, dated as of July 1, 1999, by and between ChipPAC Limited and Intel Corporation.+* 10.14 Assembly Services Agreement, dated as of August 5, 1999, by and between Intel Corporation and ChipPAC Limited.+ 10.15 Stock Purchase Agreement, dated as of August 5, 1999, by and between ChipPAC, Inc. and Intel Corporation.* 10.16 Warrant to Purchase Class B Common Stock of ChipPAC, Inc., dated as of August 5, 1999, issued to Intel Corporation.* 10.17 Advisory Agreement, dated as of August 5, 1999, by and among ChipPAC, Inc., ChipPAC Limited, ChipPAC Operating Limited and Bain Capital, Inc.* 10.18 Advisory Agreement, dated as of August 5, 1999, by and among ChipPAC, Inc., ChipPAC Limited, ChipPAC Operating Limited and SXI Group LLC.* 10.19 Employment Agreement, dated as of October 1, 1999, between ChipPAC, Inc. and Dennis McKenna.* 10.20 ChipPAC, Inc. 1999 Stock Purchase and Option Plan.* 10.21 Form of Key Employee Purchased Stock Agreement.* 10.22 Form of Key Employee Purchased Stock Agreement (with Loan).* 10.23 Form of Directors Tranche I Stock Option Agreement.* 10.24 Form of Employees Tranche I Stock Option Agreement.* 10.25 Form of Tranche II Stock Option Agreement.* 12.1 Statement Regarding Computation of Ratio of Earnings to Fixed Charges.* 21.1 Subsidiaries of ChipPAC, Inc., ChipPAC International Company Limited, ChipPAC (Barbados) Ltd., ChipPAC Limited, ChipPAC Liquidity Management Limited Liability Company, ChipPAC Luxembourg S.a.R.L. and ChipPAC Korea Company Ltd.* 23.1 Consent of PricewaterhouseCoopers LLP.* 23.2 Consent of Kirkland & Ellis (included in Exhibit 5.1).* 24.1 Powers of Attorney (included in Part II to the Registration Statement).* 25.1 Statement of Eligibility on Form T-1 of Firstar Bank of Minnesota, N.A., as trustee, under the Indenture.* 27.1 Financial Data Schedule.* 99.1 Form of Letter of Transmittal.* 99.2 Form of Notice of Guaranteed Delivery.* 99.3 Form of Tender Instructions.*
- -------- *Previously filed. +Confidential treatment requested. II-7 (b) Financial Statement Schedules. The following financial statement schedules for the three years ended December 31, 1999 are included in this registration statement. Schedule II--Valuation and Qualifying Accounts and Reserves--Allowance for Doubtful Accounts (in thousands)
Additions charged Year Ended Balance at to Costs and Deductions and Balance at End of December 31 beginning of year Expenses Write-offs Period - ----------- ----------------- ----------------- -------------- ----------------- 1999.................... 1,162 144 110 1,196 1998.................... 375 787 -- 1,162 1997.................... 85 404 (114) 375
Item 22. Undertakings. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrants pursuant to the provisions described under Item 20 or otherwise, the registrants have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrants of expenses incurred or paid by a director, officer or controlling person of the registrants in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrants will, unless in the opinion of their counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. The undersigned registrants hereby undertake: (1) To supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. (2) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (a) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933. (b) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement. (c) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. II-8 (3) That, for the purpose of determining liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (4) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the exchange offer. (5) To file a post-effective amendment to the registration statement to include any financial statements required by Section 210.3-19 at the start of any delayed offering or throughout a continuous offering. II-9 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, ChipPAC International Company Limited has duly caused this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in Tortola, British Virgin Islands, on April 27, 2000. ChipPAC International Company Limited /s/ Jane Zhang By: _________________________________ Jane Zhang President, Chief Executive Officer and Chief Financial Officer * * * * Pursuant to the requirements of the Securities Act of 1933, this Pre- Effective Amendment No. 5 to the Registration Statement on Form S-4 has been signed by the following persons in the indicated capacities on April 27, 2000:
Signatures Capacity ---------- -------- /s/ Jane Zhang President, Chief Executive Officer, Chief ____________________________________ Financial Officer and Director Jane Zhang (Principal Executive, Financial and Accounting Officer) * Director ____________________________________ Curt Mason * Director ____________________________________ Richard Parsons * Director ____________________________________ P.J. Kim Authorized Representative in the United States: /s/ Dennis P. McKenna ____________________________________ Dennis P. McKenna President and Chief Executive Officer, ChipPAC, Inc.
* The undersigned, by signing his name hereto, does hereby sign and execute this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 on behalf of the above named officers and directors of ChipPAC International Company Limited pursuant to the Power of Attorney executed by such officer and/or director and previously filed with the SEC. /s/ Dennis P. McKenna By: _________________________________ Dennis P. McKenna Attorney-in-Fact II-10 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, ChipPAC, Inc. has duly caused this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Santa Clara, State of California, on April 27, 2000. ChipPac, Inc. /s/ Dennis P. McKenna By: _________________________________ Dennis P. McKenna President and Chief Executive Officer * * * * Pursuant to the requirements of the Securities Act of 1933, this Pre- Effective Amendment No. 5 to the Registration Statement on Form S-4 has been signed by the following persons in the capacities indicated on April 27, 2000:
Signatures Capacity ---------- -------- /s/ Dennis P. McKenna President, Chief Executive ____________________________________ Officer and Director Dennis P. McKenna (Principal Executive Officer) /s/ Robert Krakauer Chief Financial Officer ____________________________________ (Principal Financial Robert Krakauer Officer) * Vice President of Finance ____________________________________ and Corporate Controller Curt Mason (Principal Accounting Officer) * Director ____________________________________ David Dominik * Director ____________________________________ Edward Conard
II-11
Signatures Capacity ---------- -------- * Director ____________________________________ Prescott Ashe * Director ____________________________________ Michael A. Delaney * Director ____________________________________ Paul C. Schorr IV * Director ____________________________________ Joseph Martin * Director ____________________________________ Chong Sup Park
* The undersigned, by signing his name hereto, does hereby sign and execute this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 on behalf of the above named officers and directors of ChipPAC, Inc. pursuant to the Power of Attorney executed by such officer and/or director and previously filed with the SEC. /s/ Dennis P. McKenna By___________________________________ Dennis P. McKenna Attorney-in-Fact II-12 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, ChipPAC Korea Company Ltd. has duly caused this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in Ichon-Shi, Kyungai-Do, Korea, on April 27, 2000. ChipPAC Korea Company Ltd. /s/ Soo Nam Lee By: _________________________________ Soo Nam Lee President and Managing Director * * * * Pursuant to the requirements of the Securities Act of 1933, this Pre- Effective Amendment No. 5 to the Registration Statement on Form S-4 has been signed by the following persons in the indicated capacities on April 27, 2000:
Signatures Capacity ---------- -------- /s/ Soo Nam Lee Director, President and Managing Director ____________________________________ (Principal Executive Officer) Soo Nam Lee * Chief Financial Officer (Principal Financial ____________________________________ and Accounting Officer) Dong Woo Lee Director ____________________________________ Dennis P. McKenna Authorized Representative in the United States: /s/ Dennis P. McKenna ____________________________________ Dennis P. McKenna President and Chief Executive Officer, ChipPAC, Inc.
* The undersigned, by signing his name hereto, does hereby sign and execute this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 on behalf of the above named officers and directors of ChipPAC Korea Company Ltd. pursuant to the Power of Attorney executed by such officer and/or director and previously filed with the SEC. /s/ Dennis P. McKenna By___________________________________ Dennis P. McKenna Attorney-in-Fact II-13 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the ChipPAC (Barbados) Ltd. has duly caused this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in Barbados, West Indies, on April 27, 2000. ChipPAC (Barbados) Ltd. /s/ Jane Zhang By: _________________________________ Jane Zhang President, Chief Executive Officer and Chief Financial Officer * * * * Pursuant to the requirements of the Securities Act of 1933, this Pre- Effective Amendment No. 5 to the Registration Statement on Form S-4 has been signed by the following persons in the indicated capacities and on April 27, 2000.
Signatures Capacity ---------- -------- /s/ Jane Zhang President, Chief Executive Officer and ____________________________________ Chief Financial Officer (Principal Jane Zhang Executive, Financial and Accounting Officer) * Director ____________________________________ Eulalie Greenaway * Director ____________________________________ Trevor Carmichael * Director ____________________________________
Curt Mason Authorized Representative in the United States /s/ Dennis P. McKenna - -------------------------------- Dennis P. McKenna President and Chief Executive Officer, ChipPAC, Inc. * The undersigned, by signing his name hereto, does hereby sign and execute this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 on behalf of the above named officers and directors of ChipPAC (Barbados) Ltd. pursuant to the Power of Attorney executed by such officer and/or director and previously filed with the SEC. /s/ Dennis P. McKenna By:____________________________ Dennis P. McKenna Attorney-in-Fact II-14 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, ChipPAC Luxembourg S.a.R.L. has duly caused this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in Luxembourg, on April 27, 2000. ChipPAC Luxembourg S.a.R.L. /s/ Michele Musty By: _________________________________ Michele Musty Corporate Manager * * * * Pursuant to the requirements of the Securities Act of 1933, this Pre- Effective Amendment No. 5 to the Registration Statement on Form S-4 has been signed by the following persons in the indicated capacities and on April 27, 2000:
Signatures Capacity ---------- -------- /s/ Michele Musty Corporate Manager ____________________________________ (Co-Principal Executive, Financial and Accounting Officer Michele Musty and Director) * Corporate Manager ____________________________________ (Co-Principal Executive, Financial and Accounting Officer Eric Vanderkerken and Director) * Corporate Manager ____________________________________ (Co-Principal Executive, Financial and Accounting Officer ChipPAC International Company and Director) Limited by: Jane Zhang President and Chief Executive Officer
Authorized Representative in the United States: /s/ Dennis P. McKenna - -------------------------------- Dennis P. McKenna President and Chief Executive Officer, ChipPAC, Inc. * The undersigned, by signing his name hereto, does hereby sign and execute this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 on behalf of the above named officers and directors of ChipPAC Luxembourg S.a.R.L. pursuant to the Power of Attorney executed by such officer and/or director and previously filed with the SEC. /s/ Dennis P. McKenna By:____________________________ Dennis P. McKenna Attorney-in-Fact II-15 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, ChipPAC Liquidity Management Hungary Limited Liability Company has duly caused this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in Budapest, Hungary on April 27, 2000. ChipPAC Liquidity Management Hungary Limited Liability Company /s/ Jozsef Veress By: _________________________________ Jozsef Veress Managing Director * * * * Pursuant to the requirements of the Securities Act of 1933, this Pre- Effective Amendment No. 5 to the Registration Statement on Form S-4 has been signed by the following persons in the indicated capacities on April 27, 2000:
Signatures Capacity ---------- -------- /s/ Jozsef Veress Managing Director (Principal Executive, ____________________________________ Financial and Accounting Officer) Jozsef Veress /s/ Curt Mason Managing Director ____________________________________ Curt Mason Authorized Representative in the United States: /s/ Dennis P. McKenna ____________________________________ Dennis P. McKenna President and Chief Executive Officer, ChipPAC, Inc.
II-16 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, ChipPAC Limited has duly caused this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in Tortola, British Virgin Islands, on April 27, 2000. ChipPAC Limited /s/ Jane Zhang By: _________________________________ Jane Zhang President, Chief Executive Officer and Chief Financial Officer * * * * Pursuant to the requirements of the Securities Act of 1933, this Pre- Effective Amendment No. 5 to the Registration Statement on Form S-4 has been signed by the following persons in the indicated capacities on April 27, 2000:
Signatures Capacity ---------- -------- /s/ Jane Zhang President, Chief Executive ____________________________________ Officer, Chief Financial Jane Zhang Officer and Director (Principal Executive, Financial and Accounting Officer) * Director ____________________________________ Curt Mason * Director ____________________________________ P.J. Kim * Director ____________________________________ Richard Parsons Authorized Representative in the United States: /s/ Dennis P. McKenna ____________________________________ Dennis P. McKenna President and Chief Executive Officer, ChipPAC, Inc.
* The undersigned, by signing his name hereto, does hereby sign and execute this Pre-Effective Amendment No. 5 to the Registration Statement on Form S-4 on behalf of the above named officers and directors of ChipPAC Limited pursuant to the Power of Attorney executed by such officer and/or director and previously filed with the SEC. /s/ Dennis P. McKenna By:____________________________ Dennis P. McKenna Attorney-in-Fact II-17 EX-10.14 2 INTEL/CHIPPAC LIMITED ASSEMBLY SERVICES AGREEMENT EXHIBIT 10.14 INTEL CONFIDENTIAL ------------------ INTEL/CHIPPAC LIMITED ASSEMBLY SERVICES AGREEMENT (Replacement Agreement for Intel Agreement No. 0995ELR001) This Agreement ("Agreement") is entered into this 5th day of August, 1999 and shall become effective upon the Effective Date, by and between Intel Corporation ("Intel"), a Delaware corporation with its principal offices located at 2200 Mission College Boulevard, Santa Clara, California 95052, and ChipPAC Limited, a British Virgin Islands corporation with principal offices located at Craigmuir Chambers, Road Town, Tortola, British Virgin Islands ("ChipPAC"). Intel and ChipPAC are sometimes collectively referred to as the "Parties" or singularly as a "Party". "Effective Date" means the date of consummation of the transactions contemplated by that certain Agreement and Plan of Recapitalization and Merger dated as of March 13, 1999, as amended, by and among Hyundai Electronics Industries Company, Ltd., Hyundai Electronics America, ChipPAC, Inc. and ChipPAC Merger Corp. RECITALS: - -------- WHEREAS, Intel desires to enter into a contract assembly and test arrangement with ChipPAC as more specifically described herein. WHEREAS, ChipPAC is in the business of doing contract assembly and test work for integrated circuit manufacturers and desires to perform such services for Intel. WHEREAS, the Parties desire to set forth below the conditions and covenants under which such work shall be performed. NOW THEREFORE, in consideration of the mutual covenants herein contained, the Parties agree as follows: 1. DEFINITIONS ----------- 1.1 "[redacted*]" shall mean Intel's chipset products utilizing the [redacted*] packaging process. 1.2 "[redacted*]" shall mean Intel's chipset products utilizing the [redacted*] packaging process. 1.3 "[redacted*]" shall mean the chipset products utilizing the [redacted] packaging process. *Confidential treatment requested. -1- 1.4 "Die Product" shall mean an Intel Product in an unassembled form, without packaging, specified in Exhibit D, and provided by Intel to --------- ChipPAC under this Agreement in order for ChipPAC to perform the Services. 1.5 "Die Product Specification" shall mean the technical information for each Intel Product which ChipPAC is authorized to handle under this Agreement. 1.6 "Facility" shall mean the Intel work area in the factory provided by ChipPAC to perform the Services as defined below. 1.7 "Intel Product" shall mean the finished product which is sold by Intel in a packaged form and which contains the die of the related Die Product, and which ChipPAC processes or manufactures on behalf of Intel which complies with the Specifications/ Performance Standards specified in Exhibit B. --------- 1.8 "Intel Product Data Sheet" shall mean the technical information for each Intel Product supplied by Intel to purchasers of Intel Products. 1.9 "Leadframes" shall mean the leadframes that ChipPAC shall order as Piece Parts in anticipation of fulfilling Intel's orders for [redacted*] and [redacted*]. 1.10 "Leadtime" shall mean TPT plus transit time to Intel. 1.11 "Leadtime Procurement Period" shall mean the procurement of Piece Parts during the Leadtime period. 1.12 "LIPAS" (Line Item Performance Against Schedule) shall mean the number of Line Items that shipped in a given week divided by the number of Line Items scheduled by ChipPAC to be shipped during the same week per Intel's forecast. 1.13 "Non Data Sheet Functionality" shall mean (a) features, instructions, operating modes, and other functions which may be contained in the Intel Product and the Die Product but which Intel does not document and which are not required for the Intel Product and the Die Product to comply with the related Intel Product Data Sheet, and (b) internal nodes and signals which are not accessible at the bond pads of the Die Product. 1.14 "Piece Parts" shall mean all materials procured and furnished by ChipPAC in order to perform the Services under this Agreement. *Confidential treatment requested. -2- 1.15 "Rejects" shall mean the product produced by ChipPAC which do not comply with the Specifications and Performance Standards specified in Exhibit B, are damaged or are otherwise returned to ChipPAC or --------- rejected by Intel. 1.16 "Release" shall mean Intel's purchase order or change order accepting ChipPAC's offer to ship a definite quantity of Intel Products or to provide Services to a specified schedule and pricing. 1.17 "Service(s)" shall mean the work to be performed as specified in Exhibit A in compliance with the Specifications/Performance Standards --------- specified in Exhibit B. --------- 1.18 "Substrates" shall mean the substrate materials that ChipPAC shall order as Piece Parts in anticipation of fulfilling Intel's orders for [redacted*] Products. 1.19 "Through Put Time" (TPT) shall mean the number of calendar days required to manufacture the Intel Product, starting when the Wafers or Die Product are released from inventory at ChipPAC and ending when the Intel Products are shipped out of ChipPAC. 1.20 "Wafer" shall mean Intel's substrate material that contains unscribed Die Product that have been sorted by Intel as Die Product which has passed the sort criteria for the Intel Product ("non-inked") and Die Product which has failed the sort criteria for the Intel Product ("inked"). 1.21 "Work in Process" referred to hereinafter as "WIP". 2. STATEMENT OF WORK ----------------- 2.1 ChipPAC will provide all facilities, equipment, material, manpower and expertise necessary to perform the Services according to Intel requirements and specifications as referenced in Exhibits A and B. ---------------- 2.2 Intel shall supply ChipPAC with all Wafers and Die Product. 2.3 ChipPAC shall provide at ChipPAC's expense all Piece Parts, supplies and peripheral products, including leadframes, required for ChipPAC to perform the Services. 2.4 ChipPAC shall perform the Services in accordance with Intel's requirements and specifications as specified in Exhibits A and B. ---------------- 2.5 ChipPAC shall at least meet the minimum yields and maximum TPT specified in Exhibit C, with a goal of continually improving both --------- yield and TPT. *Confidential treatment requested. -3- 2.6 ChipPAC shall adhere to Intel's procedures with respect to security, traceability and accountability as specified herein. 3. PRE-PRODUCTION -------------- 3.1 In the event that Intel determines a need to have certain Intel Products produced by ChipPAC on a limited scale or as prototypes in order to qualify those Intel Products or the process involved or to produce samples of the Intel Products ("Pre-Production Parts"), prior to beginning full production, Intel and ChipPAC shall agree on the quantity, specifications, pricing, Leadtime and other requirements for each such Pre-Production Part. All orders for Pre-Production Parts must first be authorized in writing by Intel. Once Intel has qualified and accepted the Pre-Production Parts, these may be ordered as Intel Products under the Agreement. 3.2 If Intel cancels all or part of any order for Pre-Production Parts, Intel shall pay for the related WIP for the canceled order, as outlined in Exhibit E, Cancellation Liability. --------- 3.3 Intel recognizes that yields for Pre-Production Parts may be difficult to control. If ChipPAC's build amount does not provide sufficient quantities to provide the quantity ordered by Intel, and the outstanding amount is less than [redacted*] of the ordered quantity, Intel may either cancel the balance of the order without penalty, or allow ChipPAC to provide the balance of the order at a later date, not to exceed fourteen (14) days from the date Intel provides replacement Die Product. 3.4 ChipPAC warrants that Pre-Production Parts shall meet design test vectors and be free of manufacturing defects, but otherwise are provided "AS IS". 4. OWNERSHIP --------- 4.1 All Wafers and Die Product shall be held by ChipPAC for the sole benefit of Intel. Ownership of Wafers and Die Product shall remain with Intel. ChipPAC acknowledges that Intel retains an ownership interest in the Wafers and Die Product and agrees to assist Intel in perfecting said security interest under the Uniform Commercial Code ------- --------------- and other relevant laws, at Intel's request. Ownership of all Rejects shall remain with Intel. 5. CONFIDENTIALITY AND PUBLICITY ----------------------------- 5.1 Any confidential information to be exchanged between the Parties shall be governed by the terms of the Corporate Non-Disclosure Agreement (CNDA) number 0875665, which ChipPAC agrees to be bound by. At a minimum, ChipPAC agrees to maintain such information in confidence, pursuant to the terms of the above-referenced CNDA, *Confidential Treatment requested. -4- to take all reasonable precautions to prevent unauthorized disclosure and to use such information only within the scope of this Agreement until the information becomes publicly available through no fault of ChipPAC. Examples of confidential information include, but are not limited to, Wafers, Die Product, Die Product Specifications, yield, probe characteristics, number of Wafers, and number of Die Product. 5.2 ChipPAC is responsible for (i) secure storage in a segregated Facility, handling, processing and return of Intel Product incorporating Die Product, and (ii) the return (or certified destruction) of all scrap/Rejects to Intel. ChipPAC will be liable for any loss, including, but not limited to, theft, destruction, and deterioration. 5.3 ChipPAC's Facility, manufacturing and wafer processing areas must be secure and accessed only by ChipPAC's employees or contractors on a need-to-know basis. Any third party, including contract employees, involved in any aspect of Wafer or Die Product shipping, storage, security, processing, assembly, or handling must sign a Non-Disclosure Agreement with Intel. 5.4 ChipPAC's employees who access Intel's premises may be required to sign a separate non-disclosure agreement prior to admittance to Intel's premises. 5.5 ChipPAC warrants that no information disclosed by ChipPAC to Intel, in any form whatsoever, is the confidential information of any other party without written authorization from that Party. 5.6 Neither Party may use the other Party's name in advertisements, news releases, publicity statements, on the internet, or otherwise disclose the existence or content of this Agreement, without the other's prior written consent. 6. DELIVERY, RELEASES AND SCHEDULING --------------------------------- 6.1 Intel shall provide ChipPAC with a rolling [redacted*] operating forecast of its requirements every week. An Intel Work Week Calendar sample is attached as Exhibit G. --------- 6.2 Response: ChipPAC shall provide a written response to Intel's [redacted*] requirements forecast letter within seven (7) working days after receipt. If no response is received by Intel in this time period, then the forecast is deemed to be approved by ChipPAC. 6.3 ChipPAC shall use the forecast only as a guide to adequately prepare for Intel's anticipated requirements. Intel is not obligated to purchase any specific business under this Agreement. Intel's forecasts are subject to change and are not commitments. ChipPAC understands that Intel's demand is dependent on market and *Confidential treatment requested. -5- other factors beyond Intel's control and this may result in demand being reduced, increased or eliminated. 6.4 ChipPAC shall meet the Intel unit requirements as set forth in the shipping Release for the applicable purchase order as acknowledged by ChipPAC as specified in paragraph 6.2 above. 6.5 Intel shall place with ChipPAC a Release for each Intel Product by the minimum Leadtime required, specifying quantity, delivery date and delivery place. ChipPAC agrees to acknowledge in writing each Release within five (5) working days. ChipPac shall make weekly delivery commitments by Line Item for the weekly Intel requests and monthly delivery commitments by Line Item for the remaining months of the forecast period. ChipPAC's delivery commitment shall be firm for the Leadtime Procurement Period. Intel may make changes to its Releases at any time in the form of "Demand Exceptions". Such Demand Exception changes shall be sent immediately to ChipPAC in writing by fax or other electronic means. ChipPAC must provide to Intel a written response to Intel's Demand Exceptions via fax or e-mail within twenty- four (24) hours after receipt of the Demand Exception changes. At such time as Intel receives ChipPAC's committed response to the Demand Exceptions, Intel shall update the Release accordingly. Leadtime Procurement Period for [redacted*] is [redacted*] weeks. 6.6 ChipPAC agrees that all orders for Intel Products will ship on the exact date specified. In the event that an order shipment is going to be late, Intel must be notified as soon as ChipPAC is aware that the Intel Product will not meet its committed ship date. Partial shipments must be authorized by Intel and are counted as late shipments and will only be considered complete when all Intel Products for that order have been received. If shipments are late by more than seven (7) days, at no fault of Intel, at Intel's option, Intel can cancel the order with no charge. ChipPAC will be responsible for any costs incurred by Intel in obtaining cover in the event of such order cancellation. Intel shall have no obligation for orders shipped more than seven (7) days late. 6.7 ChipPAC shall promptly notify Intel if ChipPAC is unable to perform Services or deliver orders as scheduled and shall state the reasons for such non-delivery or non performance. Such notification by ChipPAC shall not affect Intel's termination rights. 6.8 Delivery Performance. ChipPAC's LIPAS performance shall be 100%. If -------------------- ChipPAC's LIPAS performance falls below 100% for any reason, at no fault of Intel, then ChipPAC shall promptly implement a corrective action plan approved by Intel to bring LIPAS back into 100% compliance. On-time deliveries for LIPAS performance measurement are defined as ChipPAC shipping the Intel Product units that are due for that week's delivery up to [redacted*] days early but [redacted*] days late from the *Confidential treatment requested. -6- committed ship date specified on the purchase order. If ChipPAC's delivery is [redacted*] or more days late, a [redacted*] discount shall apply to the specific line items that are shipped late. 6.9 Intel may place any portion of a Release on hold by notice which shall take effect immediately upon receipt. Releases placed on hold will be rescheduled or canceled within a reasonable time (to be mutually agreed upon by Intel and ChipPAC). 6.10 [redacted*] At a minimum, ChipPAC shall provide ship dates based on TPT after receipt of a Release. For purposes of determining ship date TPT, the date that a Release is sent (by fax, electronic means or mail) will be the starting point for calculating the TPT. 6.11 Intel-requested or Intel-approved changes that result in ship date changes will be reflected on a written change order to the Release showing the revised ship and delivery dates. 6.12 ChipPAC shall maintain a safety stock of Piece Parts including Leadframes and Substrates in sufficient quantity to maintain production in accordance with the then-current Intel forecasts of four (4) consecutive weeks for [redacted*] and [redacted*] packages and six (6) consecutive weeks for new packages such as [redacted*] ("Safety Stock Level"), in addition to the quantity specified on the then current Release, unless otherwise requested by Intel in writing. Intel shall be responsible for the cost of the Safety Stock Level for the Leadframes and Substrates. All other Piece Part liability is covered by paragraph 6.13 below. 6.13 Cancellation. If Intel cancels all or part of any order for Intel ------------ Products, Intel shall pay for the related WIP for the canceled order, as outlined in Exhibit E, Cancellation Liability. --------- 6.14 Rescheduling. Intel may at any time, not later than seven (7) days. ------------ before the scheduled delivery date, reschedule any Release line item from such scheduled delivery date to another date. Intel will be liable only for the Piece Parts ordered relating to the specific Release line item as outlined in Exhibit E, Cancellation Liability. --------- Intel may also place all or any part of an order on hold, which shall take place immediately upon receipt of notice by ChipPAC. Orders placed on hold shall be canceled or rescheduled within a reasonable time. 6.15 ChipPAC Notice. ChipPAC shall promptly notify Intel if ChipPAC is -------------- unable to make any scheduled delivery, and shall state the reasons. *Confidential treatment requested. -7- 7. REPORTING --------- 7.1 ChipPAC shall provide Intel with a weekly report of all inventories (including Die Product inventory), production schedule status, WIP inventory, shipment, and any and all engineering and quality data required for yield loss analysis to a designated Intel Representative at Intel ISSL. This report must be in Intel's possession by 12:00 noon each Monday (Korean time) for the previous week. Intel may at any time, upon one (1) business day's notice to ChipPAC, conduct a physical inventory of all such Wafer, Die Product, Intel Products, WIP and/or Rejects in the possession of ChipPAC. 7.2 At Intel's option, ChipPAC shall provide the Intel Program Manager, with a soft copy or hard copy of monthly reports to a designated Intel representative of all shipouts, ending-on-hand inventories (including Wafer and Die Product inventory), Rejects, and units in-transit out of production Facility to Intel. This report must be in Intel's possession on the Intel month-end Friday by the end of the business day (U.S. Pacific Time). Intel may at any time, upon one (1) business day's notice to ChipPAC, cycle count and/or audit inventory all such Wafers and Die Product, Intel Product and/or Rejects in the possession of ChipPAC. 8. PRICE AND PAYMENT ----------------- 8.1 For the [redacted*] products there is no non-recurring engineering ("NRE") charges. For future products, the parties may negotiate NRE charges to be paid by Intel. 8.2 Prices charged by Hyundai, ChipPAC's predecessor, for the Services during the one-year period from September 16, 1996 are specified in Exhibit E. The pricing schedule specified in Exhibit E shall remain --------- --------- firm or decline for the one-year period from September 16, 1996 unless process changes are made by Intel, in which case a revised pricing schedule shall be mutually agreed to by both Parties. Notwithstanding the above, in extraordinary circumstances wherein Intel requests changes to the Intel Product that substantially affect the price or if market factors have changed which substantially affect the price, the Parties will negotiate a revised pricing schedule which shall be mutually agreed to by both Parties. 8.3 Hyundai, ChipPAC's predecessor, warranted that prices set forth in Exhibit E reflect [redacted*] in consideration of the volume of Intel Product purchases forcast by Intel. [redacted*] Intel and ChipPAC agree to review the pricing under this Agreement not less than every ninety (90) days [redacted*], and that ChipPAC is successful in continually reducing the pricing provided to Intel. *Confidential treatment requested. -8- 8.4 Invoices shall include: purchase order number, description of and dates of Services provided, prices and extended totals. Payment shall not constitute acceptance of Intel Products. Applicable taxes and other charges such as duties, customs, tariffs, imposts and government imposed surcharges shall be stated separately on ChipPAC's invoice. 8.5 Additional costs, beyond those described on Exhibit E, shall not be --------- reimbursed without Intel's prior written approval. 8.6 ChipPAC shall provide invoices with each shipment to Intel. All such invoices shall be paid by Intel in U.S. dollars, net thirty (30) days from the receipt of an acceptable invoice. The invoice amounts shall be calculated based on the pricing set forth in Exhibit E or such --------- other pricing mutually agreed upon by Intel and ChipPAC. 9. QUALITY AND RELIABILITY ----------------------- 9.1 Qualification Requirements. ChipPAC is responsible for meeting and -------------------------- maintaining Intel's Quality and Reliability (Q&R) requirements as listed in the Specifications referenced in Exhibit B. --------- 9.2 Qualification Stresses and Testing. ChipPAC is responsible for ---------------------------------- performing all qualification stresses and testing as per the Specifications referenced in Exhibit B, except for those stresses and --------- tests which Intel and ChipPAC mutually agree will be performed by Intel. These exceptions will be documented on any new product and/or package introduction by Intel to ChipPAC. 9.3 Traceability. ChipPAC shall demonstrate to Intel that ChipPAC's ------------ traceability system tracks each Intel Product box and unit to a specific fab, assembly and test lot traveler, and is capable of tracing to where each Intel Product lot was shipped and on which day. Traceability records shall be maintained for five (5) years. 9.4 Manufacturing and Monitoring. ChipPAC shall properly manufacture, ---------------------------- monitor, test, and inspect all Intel Product and Rejects resulting from the performance of the Services in accordance with the specifications in Exhibits A and B. ChipPAC shall manufacture Intel ---------------- Product only at the Facilities qualified by Intel and documented in the specifications referenced in Exhibits A and B. ChipPAC may not ---------------- move any portion of the manufacturing process to any other facility except with the prior written approval of Intel. 9.5 Change Control. Requirements and specifications listed in Exhibits A -------------- ---------- and B define the change control baseline. ChipPAC shall notify Intel ----- of any proposed changes from the change control baseline at least one hundred and twenty (120) days prior to the receipt of affected Intel Product at Intel, per the requirements in Change Control -9- Specifications listed in Exhibit B. ChipPAC shall provide Intel with --------- Q&R data supporting the proposed change and Intel Product samples at least one hundred (100) days prior to the proposed implementation date of the change. ChipPAC shall not make the proposed change without Intel's prior written approval. ChipPAC is responsible for ensuring that the Leadtime of affected Intel Products to Intel is met. In the event Intel's customers, or Intel, reasonably determine not to accept the proposed changes, ChipPAC shall not make such change(s). 9.6 Failure Analysis Correlation Request. When potentially defective ------------------------------------ Intel Product is returned to ChipPAC by Intel or Intel's customers, ChipPAC shall promptly perform correlation and failure analysis against the specifications referenced in Exhibit B, stop processing --------- questionable Intel Product and implement corrective action on the Intel Product and WIP. ChipPAC commits to resolve issues in accordance with the following timing following receipt of initial failure report: (a) Initial Correlation: Go/No-Go electrical or mechanical tests shall be performed within five (5) calendar days of receipt. A telephone report to Intel will be the timing end point. ChipPAC shall follow-up with a summary of the testing and results. In the event of Intel customers' going "lines-down" or approaching a near "lines down" situation, Intel shall request initial correlation testing reports to be completed within twenty-four (24) hours of ChipPAC's receipt. (b) Unless otherwise requested, ChipPAC shall complete, implement and document failure analysis and/or stop processing questionable Intel Product within twenty-five (25) calendar days of receipt. (c) Unless otherwise requested, ChipPAC shall implement a root cause corrective action plan within fifty-five (55) calendar days of receipt. ChipPAC agrees to provide failure analysis correlation request support for up to three (3) years after last delivery of an Intel Product to Intel. 9.7 Continuous Improvement. During the production life of each Intel ---------------------- Product, ChipPAC shall seek to continuously improve performance in the areas of Q&R pursuant to the requirements and specifications listed in Exhibits A and B. Both Parties shall meet regularly to review ---------------- progress and define improvement actions and objectives. The meeting frequency shall be as agreed by the Parties. During the production period, ChipPAC shall adequately staff to sustain and manage the Intel program including supporting programs of continuous improvement. 9.8 Corrective Action. ----------------- -10- (a) Intel may periodically sample Intel Product and use the data obtained to determine if the Q&R requirements and/or other specifications are being met. If Intel determines that requirements are not being met, Intel shall notify ChipPAC and Intel may reject any affected Intel Product and the affected lots and return it to ChipPAC. If ChipPAC is responsible for the failure and is unable to correct the problem after a reasonable period of time, Intel may cancel, at no cost or obligation to Intel, Releases for Intel Products affected by the problem and Intel shall have no liability for WIP. (b) If Intel Product fails to consistently meet the Q&R requirements, or if in Intel's reasonable opinion, any failure or recurring failure by ChipPAC to maintain the specifications referenced in Exhibit B could lead to damage to the reputation of Intel or --------- Intel products, the Parties agree that the senior management of the Parties, within two (2) working days after receipt of a written notice from Intel of such situation, will commence discussions regarding the problem. The Parties will cooperate fully and share all relevant information in attempting to resolve the situation. If the Parties do not mutually agree after such discussion that the problems have been resolved, ChipPAC will, at Intel's written request, cease manufacturing any Intel Products which, in Intel's opinion, may be affected by such reliability, quality or process control problems until such time as Intel agrees that the problem or problems have been resolved. Further, if ChipPAC is responsible for the failure or recurring failure, then Intel may cancel Intel Product orders at no cost or obligation to Intel, including for WIP. 9.9 Audit. Intel representatives and key customer representatives, upon ----- Intel's request, shall be allowed to visit ChipPAC's assembly and test facilities during normal working hours upon reasonable notice to ChipPAC for the purpose of monitoring production processes and compliance with any requirements set forth in this Agreement. Upon completion of the audit, ChipPAC and Intel will mutually agree to an audit closure plan, to be documented in the audit report issued by Intel. ChipPAC agrees to execute the audit closure plan within ninety (90) days of receipt of the audit report. 10. PACKING AND SHIPMENT -------------------- 10.1 ChipPAC shall mark and pack all Intel Product in accordance with the specifications referenced in Exhibit B. --------- 10.2 Transportation charges and insurance for all returned Intel Products and Rejects are to be paid by ChipPAC. Risk of loss for Intel Products and all returned Rejects in transit shall remain with ChipPAC. This paragraph shall not apply in cases where Intel uses a designated freight forwarder for Intel Products and Rejects. -11- 10.3 F.O.B. point for Intel Product is point of origin unless otherwise specified by Intel and agreed to by both Parties. All items shall be prepared for shipment in a manner which (i) follows good commercial practice, (ii) is acceptable to common carriers for shipment at the lowest rate, and (iii) is adequate to ensure safe arrival. ChipPAC shall mark all containers with necessary lifting, handling and shipping information, purchase order number, and the date of shipment. ChipPAC shall select the most cost effective carrier, given the time constraints known to ChipPAC. This paragraph shall not apply in cases where Intel uses a designated freight forwarder or provides ChipPAC with other written instructions for Intel Products and Rejects. 10.4 ChipPAC may use any freight forwarder of its own designation for Rejects being returned under warranty as specified in Section 11 below, in which case, ChipPAC shall make all transportation arrangements and prepay charges of transportation between Intel and ChipPAC. 11. WARRANTY -------- 11.1 ChipPAC warrants that the Services for Intel Products performed by ChipPAC shall be free from defects in material and workmanship, shall not affect the merchantability of Intel Products for so long as such Intel Products are used by any means fit for ordinary purposes, and shall meet all agreed upon specifications and requirements as stated in Section 2, Exhibits A and B. Intel may reject and immediately stop ---------------- shipment of Intel Product which fails to meet the foregoing warranty. If ChipPAC is unable to correct such failure within a reasonable time, Intel may cancel, at no cost or obligation to Intel, Releases subject to the failure, and Intel shall have no obligation for WIP. If such failure continues or affects a significant amount of Product, Intel may terminate this Agreement. 11.2 Claims. Intel Product subject to warranty claims shall be returned to ------ ChipPAC together with an explanation of claim. Intel shall not make a claim under this warranty no more than eighteen (18) months after Intel Product delivery. ChipPAC shall replace any Rejects covered by the warranty with replacement Intel Products in equivalent number and within the appropriate Leadtime as specified on Exhibit F, without --------- charge to Intel and with ChipPAC paying Intel the amount listed in Exhibit F (liquidated damages assessment) for each replacement Die --------- Product. Intel has the option to trade the current package replacement with a different Intel Product as Intel demand indicates. 11.3 Intel may, at its option, perform an incoming Intel Product inspection within sixty (60) days of Intel's receipt of Intel Product. Intel shall notify ChipPAC in writing that it will be returning Rejects to ChipPAC for verification. ChipPAC shall verify that the Intel rejection was appropriate within two (2) weeks after receipt. If Intel does not send notification to ChipPAC that Rejects will be returned, then it is agreed that the -12- Intel Products subject to the then current shipment is deemed to have passed quality inspection and the warranty period begins to run. 11.4 Rejection Criteria ------------------ (a) If any full or partial shipment of Intel Product delivered to Intel fail to comply with this warranty, then at its option, Intel may: i) reject defective Intel Product and return them to ChipPAC for rework, or ii) in the event rework is not possible, Intel may within one-hundred-twenty (120) days from date of rejection, furnish to ChipPAC sufficient additional Wafers or Die Product to permit ChipPAC to provide replacement of Intel Product at no cost to Intel, or iii) reject the work on any or all Rejects and not pay for such work. (b) All labor and shipping for reworked and replacement Intel Products shall be provided by ChipPAC at no additional charge to Intel so long as the assembly requirements for the Intel Product being reworked or replaced have not changed since the original labor was provided. (c) All rework and replacement Intel Product shall be completed and returned to Intel within the maximum TPT (as specified in Exhibit C) from the date of receipt by ChipPAC, unless otherwise --------- agreed to in writing by both Parties. 11.5 CHIPPAC'S EXPRESS WARRANTIES INCLUDING THE WARRANTY OF MERCHANTABILITY SET FORTH IN THIS AGREEMENT ARE IN LIEU OF ALL OTHER WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, WARRANTIES AS TO CONDITION, DESCRIPTION, FITNESS FOR A PARTICULAR PURPOSE, INFRINGEMENT, OR AS TO ANY OTHER MATTER. 11.6 Return of Wafers and Die Product; Liquidated Damages; and Accounting -------------------------------------------------------------------- (a) Return of Wafers and Die Product. Unless otherwise agreed, -------------------------------- ChipPAC hereby acknowledges and agrees it is responsible to Intel for the return of all Wafers and Die Product delivered to ChipPAC by Intel; the Wafers and Die Product may be returned as Intel Product or otherwise. Any Intel Product not meeting the specifications contained in Exhibit A shall be returned to Intel --------- as Rejects (separated and labeled accordingly). (b) Liquidated Damages. The failure of ChipPAC to return any Wafers ------------------ and Die Products to Intel, as either Wafers or Die Product, Intel Product, Pre-Production Parts or Rejects, expressed as a yield percentage of the total amount of good Die Products supplied by Intel, as shown on Exhibit F, shall subject ChipPac to a --------- liquidated damage assessment as specified on Exhibit F. --------- -13- Such damages shall be assessed as liquidated damages and not as a penalty, as it would be difficult or impossible to ascertain Intel's actual damages. In addition, Intel shall not pay any packaging costs or unacceptable, damaged or lost Die product. At Intel's option, liquidated damages may be offset against monies owed to ChipPAC by Intel. (c) Accounting. Wafers and Die Product shall be reconciled with any ---------- variances dispositioned on a monthly basis, on a report provided by ChipPAC within one (1) week following each Intel month end as shown by the calendar in Exhibit G. ChipPAC shall also provide a --------- detailed explanation of the reason(s) for any failure or inability to return delivered Wafers and Die Product. This accounting is supplemental to the reports specified in Section 7.2 and subject to Intel's audit rights specified in Section 9.9. 11.7 RMA Procedures. All Rejects or Finished Products returned to ChipPAC -------------- by Intel, under this Section 11, shall be in accordance with ChipPAC's Return Material Authorization ("RMA") set forth in Exhibit H. ChipPAC --------- shall pay all freight charges on returned materials. 12. INSURANCE --------- 12.1 ChipPAC shall bear all risk of loss for all Intel Product, WIP, Pre- Production Parts, Rejects, Wafer and Die Product while at its Facility, including providing at its own expense, adequate Commercial Property Insurance or Inland Marine Insurance against loss of or damage to the Wafer and Die Product which shall cover, as a minimum, the replacement cost of all the Wafer and Die Product provided by Intel, with Intel named as a Loss Payee. ChipPAC shall bear the cost of any deductible or co-insurance. In the event of loss or damage, ChipPAC shall promptly reimburse Intel for all replacement costs, including all such deductible or co-insurance costs. 12.2 Without limiting or qualifying ChipPAC's liabilities, obligations, or indemnities otherwise assumed by ChipPAC pursuant to this Agreement, ChipPAC shall maintain, at its sole cost and expense with companies acceptable to Intel, Commercial General Liability and Automotive Liability Insurance with limits of liability not less than $1,000,000 per occurrence and including liability coverage for bodily injury or property damage (i) assumed in a contract or agreement pertaining to ChipPAC's business, and (ii) arising out of ChipPAC's Services. ChipPAC's insurance shall be primary and any applicable insurance maintained by Intel shall be excess and non-contributing. The above coverage shall name Intel as an additional insured, and shall contain a severability of interest clause. 12.3 ChipPAC shall also maintain Statutory Workers' Compensation coverage, including a Broad Form All States endorsement in the amount required by law, and Employer's -14- Liability insurance coverage with liability limits of not less than $1,000,000 per occurrence. Such insurance shall include an insurer's waiver of subrogation in favor of Intel. 12.4 ChipPAC shall provide Intel with properly executed Certificates of Insurance prior to furnishing any Intel Product or Services hereunder and shall notify Intel, no less than thirty (30) days in advance of any reduction or cancellation of the above coverage. 12.5 Notwithstanding the insurance requirements of this Agreement, ChipPAC shall be given the option to self insure for so long as ChipPAC's net worth as a corporate entity remains above one billion dollars ($1,000,000,000). Coverage shall apply to any loss which but for the existence of a deductible or self-insured retention would be covered under the insurance requirements described herein. 13. LIMITATION OF LIABILITY ----------------------- 13.1 IN NO EVENT SHALL EITHER PARTY BE LIABLE UNDER THIS AGREEMENT FOR LOSS OF PROFITS, LOSS OF DATA OR USE, OR ANY SPECIAL, CONSEQUENTIAL OR INCIDENTAL DAMAGES, HOWEVER CAUSED, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGE. IN NO EVENT WILL EITHER PARTY'S LIABILITY TO THE OTHER EXCEED THE SUMS PAID BY INTEL TO CHIPPAC UNDER THIS AGREEMENT. THE PARTIES ACKNOWLEDGE THAT THESE LIMITATIONS ON POTENTIAL LIABILITIES ARE AN ESSENTIAL ELEMENT IN SETTING CONSIDERATION UNDER THIS AGREEMENT. 14. INDEMNIFICATION --------------- 14.1 ChipPAC agrees to defend, indemnify and hold Intel harmless from and against any and all claims, liability, demands, suits, forfeitures, penalties, judgment, and the associated costs and expenses (including attorney's fees), which it may hereafter incur, become responsible for or payout as a result of death or personal injury (including bodily injury) to any person, destruction or damage to any property, contamination of or adverse affects on the environment and any clean- up costs in connection therewith, or any violation of law, governmental regulation or orders, caused in whole or in part by i) ChipPAC's breach of any term or provision of this Agreement, or ii) any acts, errors or omissions by ChipPAC, its employees, officers, agents, representatives, or sub-contractors of any terms or provision of this Agreement, or iii) Services or Piece Parts provided by ChipPAC. 14.2 Intellectual Property Indemnification. ChipPAC shall defend, ------------------------------------- indemnify, and hold Intel and its customers harmless from any costs, expenses (including attorney's fees), losses, damages or liability incurred because of actual or alleged infringement of any -15- patent, copyright, trade secret, trademark, maskwork or other proprietary right arising out of the use or sale by Intel or use by Intel's customers of Intel Product. Intel shall notify ChipPAC of such claim or demand and shall permit ChipPAC to participate in the defense hereof. If an injunction issues as a result of any such claim, ChipPAC agrees at its expense and Intel's option to either (i) procure for Intel the right to continue using Intel Product, (ii) replace them with non-infringing Intel Product, (iii) modify them so they become non-infringing, or (iv) refund to Intel the amount paid. Such indemnification shall not apply where items are manufactured to Intel's detailed design. 15. TERM AND TERMINATION -------------------- 15.1 This Agreement shall become effective only upon the consummation of the recapitalization transactions contemplated by that certain Agreement and Plan of Recapitalization and Merger dated as of March 13, 1999, as amended, by and among Hyundai Electronics Industries Co., Ltd., Hyundai Electronics America, ChipPAC, Inc. and ChipPAC Merger Corp., and shall be of no force or effect prior to such time. This Agreement shall have prospective effect from the consummation of such recapitalization transactions only and shall have no retroactive effect to any time prior to the consummation of such recapitalization transactions. This Agreement shall forthwith lapse if the Recapitalization Agreement is terminated. This Agreement shall remain in effect until 30 months after July 1, 1999, unless extended by mutual agreement of the parties. 15.2 Termination by Intel for Cause. Notwithstanding anything in Paragraph ------------------------------ 15.1 to the contrary, if ChipPAC fails to meet Intel's quality standards, specifications, rejection rates or yield rates as specified in Exhibits B and C, or any other material breach of this Agreement, ---------------- then Intel may give ChipPAC sixty (60) days written notice of intention to terminate this Agreement. If ChipPAC has not corrected such deficiencies as specified by Intel within said sixty (60) day period, then Intel may terminate this Agreement by written notice at the end of said sixty (60) day period. 15.3 Termination by ChipPAC for Cause. Notwithstanding anything in -------------------------------- Paragraph 15.1 to the contrary, if Intel has committed a material breach of this Agreement, then ChipPAC may give Intel sixty (60) days written notice of intention to terminate this Agreement. If Intel has not corrected such deficiencies as specified by ChipPAC within said sixty (60) day period, then ChipPAC may terminate this Agreement by written notice at the end of said sixty (60) day period. 15.4 Termination by Mutual Agreement. In addition to the parties' ------------------------------- respective rights above, this Agreement may be terminated by mutual written agreement by and between ChipPAC and Intel. -16- 15.5 Technology Transfer. For purpose of this section, a "transfer event" ------------------- shall include the following: (i) ChipPAC is unable to meet its delivery commitments; (ii) ChipPAC materially breaches the Agreement and/or (iii) when volume requires that Intel or other second source manufacturing capacity be established to meet Intel's requirements. If transfer event occurs, Intel shall notify ChipPAC. The Parties agree that ChipPAC shall provide to Intel, the manufacturing process database, test tape, assembly design rules and other intellectual property specific to the affected Intel Product(s) necessary to bring up an alternative manufacturing source (whether with a third party or Intel) for Intel Product. The specific terms, conditions and costs of the Technology Transfer shall be negotiated in good faith and shall be mutually agreed upon in writing. 15.6 Obligations Upon Termination ---------------------------- (a) In the event of termination by mutual agreement or termination by either party for cause, ChipPAC shall, within thirty (30) days from date of termination, provide a certified accounting for and return to Intel at Intel's cost and expense all Wafers, Die Product, Intel Product, Pre-Production Parts, WIP, Rejects, specifications, documentation, Intel developed software, and any other materials provided to ChipPAC by Intel during the term of this Agreement. (b) If ChipPAC does not return said Wafers, Die Product, Intel Product, Pre-Production Parts, WIP, or other materials provided by Intel within such thirty (30) day period, Intel shall invoice ChipPAC and ChipPAC shall pay Intel an amount equal to Intel's list price or purchase price or, if neither is available, the replacement costs for all non-returned materials. (c) Intel shall have no obligations upon termination except to pay any outstanding invoices for Intel Product ordered by Intel and produced by ChipPAC or for WIP based upon the agreed upon cancellation charges for each Intel Product, as a result of Intel orders placed prior to the termination notice. (d) Intel's rights and remedies herein are in addition to any other rights and remedies provided by law or in equity. (e) There shall be no charges for termination of orders for Services not yet provided. Intel shall be responsible for payment of authorized Services already provided by ChipPAC but not yet invoiced. (f) Before assuming any payment obligation under this Section, Intel may inspect ChipPAC's work and audit all relevant documents. -17- 15.7 Continuing Rights and Obligations. The respective rights and --------------------------------- obligations of ChipPAC and Intel under the provisions of Section 4 OWNERSHIP, Section 5 CONFIDENTIALITY AND PUBLICITY, Section 11 WARRANTY, Section 13 LIMITATION OF LIABILITY, Section 14 INDEMNIFICATION, Paragraph 18.1 Controlling Law, and Section 19 Dispute Resolution shall survive termination of this Agreement. 16. HAZARDOUS MATERIALS ------------------- 16.1 If Intel Product, Rejects or Services include hazardous materials as defined by relevant local, state and national law, ChipPAC represents and warrants that ChipPAC and its personnel providing Services and Piece Parts to Intel understand the nature of and hazards associated with the design and/or service of items including handling, transportation, and use of such hazardous materials, as applicable to ChipPAC. Prior to causing hazardous materials to be on Intel's property, ChipPAC shall obtain written approval from Intel's site Environmental/Health/Safety organization. ChipPAC shall be fully responsible for indemnification to Intel for any liability resulting from ChipPAC's actions in connection with (i) providing such hazardous materials to Intel, or (ii) the use of such hazardous materials in providing Intel Product, Rejects, Piece Parts or Services to Intel. The foregoing indemnification and liability shall not be applied to the actions or measures taken by ChipPAC pursuant to the express written instructions of Intel where ChipPAC has stated reasonable objection. 16.2 As they become available, ChipPAC shall provide Intel with material safety data sheets and any other documentation reasonably necessary to enable Intel to comply with applicable laws and regulations. 16.3 ChipPAC hereby certifies that Intel Product or Piece Parts supplied to Intel do not contain and are not manufactured with any ozone depleting substances, as those terms are defined by law. 17. NEW DEVELOPMENTS ---------------- 17.1 All inventions and discoveries, whether or not patentable, made by Intel employee(s) in the course of performance of this Agreement not using the confidential information of ChipPAC shall be the sole and exclusive property of Intel, and Intel shall retain any and all rights to file at its sole discretion any patent application thereon. 17.2 All inventions and discoveries, whether or not patentable, made by ChipPAC employee(s) in the course of performance of this Agreement not using the Confidential Information of Intel shall be the sole and exclusive property of ChipPAC, and ChipPAC shall retain any and all rights to file at its sole discretion any patent application thereon. -18- 17.3 If Intel and ChipPAC jointly made inventions or discoveries, whether or not patentable, not using the confidential information of either Intel or ChipPAC, in the course of performance of this Agreement, then unless provided herein, such joint invention shall be jointly owned by Intel and ChipPAC with each party having the right to exploit and grant licenses in respect to such inventions and any patents arising therefrom, without the consent of or accounting to the other Party. In the event of a joint invention, the Parties shall mutually agree which Party shall have the responsibility for preparing and filing any patent application on the invention and the Parties agree to execute documents required for and equitably share in the expenses associated with obtaining and maintaining such patents. 17.4 In the event one Party elects not to seek or maintain patent protection for any joint invention in any particular country or not to share equitably in the expenses thereof with the other Party, that other Party shall have the right to apply for or maintain such patent protection at its own expense in such country, and shall have full control over the protection and maintenance therefor, even though title and rights to any patent resulting therefrom shall be jointly owned. 18. GENERAL ------- 18.1 Controlling Law. Any claim arising under or relating to this --------------- Agreement shall be governed by the internal substantive laws of the State of Delaware without regard to principles of conflict of laws. Each party hereby agrees to jurisdiction and venue in the State of Delaware or federal courts located in Delaware for all disputes and litigation arising under or relating to this Agreement. This provision is meant to comply with 6 Del. C. Section 2708(a). 18.2 Compliance With Laws. ChipPAC shall comply with all applicable -------------------- federal, state and local laws and regulations governing the maintenance and operation of the Facility and performance of Services covered by this Agreement, including, but not limited to, Department of Commerce, Environmental Protection Agency and Department of Transportation regulations applicable to hazardous materials and all employment and labor laws governing ChipPAC's personnel providing Services to Intel. 18.3 Export Control. ChipPAC shall not export, either directly or -------------- indirectly, any Wafers, Die Product or Intel Product without first obtaining any required license or other approval from the U.S. Department of Commerce or any other agency or department of the United States Government. 18.4 Force Majeure. The Parties hereto shall not be liable for any failure ------------- to perform due to unforeseen circumstances or causes beyond that Party's reasonable control. Examples of such causes include, but are not limited to, acts of God, war, riot, -19- embargoes, acts of civil or military authority, fire, flood, accidents, labor disputes (but no more than one (1) labor dispute occurrence per year) earthquakes or shortages of transportation facilities, fuel or materials which cannot be reasonably replaced from other sources. If the Services are to be delayed by such contingencies, ChipPAC shall immediately notify Intel in writing and Intel may either i) extend time of performance, or ii) terminate the uncompleted portion of the order at no cost to Intel, or iii) terminate this Agreement under the provisions of Paragraph 15.3. In cases of a labor dispute ChipPAC shall be responsible to return all Intel Products, Wafers, Die Product, Rejects, documentation and related materials to Intel in accordance with Paragraph 15.5 if so requested by Intel. 18.5 No Partnership/Joint Venture. Performance by the Parties under this ---------------------------- Agreement shall be as independent contractors. Nothing contained herein or performed under the terms of this Agreement shall constitute the Parties entering upon a joint venture or partnership, or shall constitute either Party as the agent of the other Party for any purpose. 18.6 Assignment. Intel may assign this Agreement to its subsidiaries or ---------- affiliates, authorized distributors, or any successor by merger without ChipPAC's consent; and ChipPAC may assign this Agreement to its subsidiaries or affiliates without Intel's consent. Otherwise, this Agreement may not be assigned or otherwise transferred, in whole or in part by either Party without the other's prior written consent. No attempt to assign or to transfer in violation of this provision by either Party shall be binding upon the other. 18.7 Trademarks. Neither Party has any right to use any trademark, logo, ---------- trade name or other identifying mark of the other Party. 18.8 Waiver. Failure by either Party to insist in any instance upon strict ------ conformance to any term or condition herein, or failure by either Party to act in the event of a breach or default, shall not be construed as a consent to or a waiver of that breach or default or any subsequent breach or default of the same or of any other term or condition contained herein. 18.9 Notices. Any notice required under this Agreement shall be given in ------- writing and delivered in person or by certified or first-class United States mail, properly addressed and stamped with the required postage, to the intended recipient as follows: For ChipPAC Limited: For Intel: -20- ChipPAC Limited Intel Corporation Craigmuir Chambers M/S C6-404 Road Town, Tortola 5000 West Chandler Boulevard British Virgin Islands Chandler, AZ 85226 Attention: Resident Director Attention: Legal Department cc: cc: ChipPAC, Inc. Intel Corporation 3151 Coronado Drive M/S SC4-203 Santa Clara, CA 95054, USA 2200 Mission College Blvd. Attention: Chief Executive Officer Santa Clara, CA 95052 Attention: Legal Department Either party may change its address as listed above by providing advance written notice to the other Party. 18.10 Severability. If any provision of this Agreement shall be held to ------------ be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 18.11 Order of Precedence. ------------------- (a) Orders placed hereunder during the term of this Agreement shall be governed by and subject to only the terms and conditions of this Agreement and applicable Releases. If any inconsistency or conflict should arise between this Agreement and the applicable Releases, the order of precedence in resolving such inconsistency or conflict shall be: (1) Release Instructions; (2) Amendments to this Agreement; (3) This Agreement; (4) Product Specifications; and (5) Exhibits to this Agreement. (b) Notwithstanding the foregoing, the Parties agree that the terms and conditions preprinted on the Releases and/or ChipPAC's order acknowledgment forms, shall not apply. -21- (c) It is expressly agreed that any lack of reference to this Agreement on any Purchase Order issued by Intel shall not affect the applicability of this Agreement to such order. 18.12 Entire Agreement. This Agreement, including the recitals and the ---------------- referenced Exhibits, set forth the entire Agreement of the Parties with respect to the subject matter hereof, and supersedes all prior and contemporaneous negotiations, correspondence and agreements pertaining thereto. No modification or waiver of any provision of this Agreement or consent to any departure therefrom shall be effective unless made in writing by authorized representatives of the Parties hereto. 18.13 Ownership and Bailment Responsibilities. Any specifications, --------------------------------------- drawings, schematics, technical information, data, tools, dies, patterns, masks, samples, gauges, test equipment and other materials furnished to ChipPAC or paid for by Intel shall (i) be kept confidential, (ii) remain or become Intel's property, (iii) be used by ChipPAC exclusively for Intel's orders, (iv) be clearly marked as Intel's property, (v) be segregated when not in use, (vi) be kept in good working condition at ChipPAC's expense, and (vii) be shipped to Intel promptly on Intel's demand or upon termination or expiration of this Agreement, whichever occurs first. ChipPAC shall adequately insure Intel's property. ChipPAC shall be liable for loss or damage to Intel's property while in ChipPAC's possession or control. 19. DISPUTE RESOLUTION ------------------ 19.1 All disputes arising directly under the express terms of this Agreement or the grounds for termination thereof shall be resolved as follows: The senior management of both Parties shall meet to attempt to resolve such disputes. If the disputes cannot be resolved by the senior management, either Party may make a written demand for formal dispute resolution and specify therein the scope of the dispute. Within thirty (30) days after such written notification, the Parties agree to meet for one day with an impartial mediator and consider dispute resolution alternatives other than litigation. If an alternative method of dispute resolution is not agreed upon within thirty (30) days after the one (1) day mediation, either Party may begin litigation proceedings. 20. EXHIBITS -------- The following Exhibits are included as part of this Agreement: Exhibit A - Services Requirements -22- Exhibit B - Specifications/Performance Standards Exhibit C - Yields/TPT/LIPAS Exhibit D - Intel Wafer and Die Product Provided to ChipPAC Exhibit E - Contract Pricing/Cancellation Liability Exhibit F - Liquidated Damages/Replacement Product Leadtime Exhibit G - Intel Work Week Calendar Exhibit H - ChipPAC's RMA Procedures IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the dates indicated by their respective signatures. CHIPPAC LIMITED INTEL CORPORATION By: /s/ Richard Parsons By: /s/ Craig C. Brown --------------------------------- ------------------------------- Signature Signature Richard Parsons for Westlaw Limited Craig C. Brown - ------------------------------------- ----------------------------------- Name Name Director Director - ------------------------------------- ----------------------------------- Title Title July 20, 1999 July 30, 1999 - ------------------------------------- ----------------------------------- Date Date -23- EXHIBIT A SERVICES REQUIREMENTS --------------------- Intel requires ChipPAC to assemble Intel-provided die in wafer form into [redacted*] and/or [redacted*] and ship the assembled Intel Product to Intel. *Confidential treatment requested. A-1 INTEL CONFIDENTIAL ------------------ EXHIBIT "B" SPECIFICATIONS/PERFORMANCE STANDARDS ------------------------------------ [redacted*] *Confidential treatment requested. INTEL CONFIDENTIAL ------------------ SPECIFICATIONS/PERFORMANCE STANDARDS (Continued) ------------------------------------------------ INTEL CONFIDENTIAL ------------------ SPECIFICATIONS/PERFORMANCE STANDARDS (Continued) ------------------------------------------------ EXHIBIT C YIELD/TPT/LIPAS ---------------
AVG. AVG. AVG. LINE ITEM PRODUCT TIME PERIOD YIELDS TPT PERFORMANCE [redacted*] Effective Date thru [redacted*]% [redacted*] days 100% Termination of Agreement [redacted*] Effective Date thru [redacted*]% [redacted*] days 100% Termination of Agreement [redacted*] Effective Date thru [redacted*]% [redacted*] days 100% Termination of Agreement
LIPAS: ChipPAC's LIPAS performance shall be 100%. If ChipPAC's LIPAS performance falls below 100% for any reason, then ChipPAC shall implement a corrective action plan approved by Intel to bring deliveries back into 100% compliance. On-time deliveries for LIPAS performance measurement are defined as ChipPAC shipping the Intel Product units that are due for that week's delivery up to [redacted*] days early but [redacted*] days late from the date specified on the purchase order. *Confidential treatment requested. C-1 EXHIBIT D INTEL WAFERS AND DIE PRODUCT PROVIDED TO CHIPPAC ------------------------------------------------ Intel Products provided to ChipPAC include, but are not limited to, the following: Intel die in wafer form with proper thickness which fits ChipPAC's tape mount and die saw process for the following packages: [redacted*] *Confidential treatment requested. D-1 EXHIBIT E CONTRACT PRICING REV. 1/CANCELLATION LIABILITY ---------------------------------------------- CONTRACT PRICING - ---------------- [REDACTED*] All subsequent pricing changes for all Intel Products are to be mutually agreed upon between Intel and ChipPAC. Such pricing previsions shall be provided to Intel by the ChipPAC Strategic Accounts Manager on a timely basis. *Confidential treatment requested. E-1 EXHIBIT F LIQUIDATED DAMAGES & REPLACEMENT PRODUCT LEADTIME ------------------------------------------------- [REDACTED*] *Confidential treatment requested. F-1 INTEL CONFIDENTIAL EXHIBIT "G" INTEL WORK WEEK CALENDAR - 1995 -------------------------------
(WW) SUN MON TUES WED THUR FRI SAT - ------------------------------------------------------------ JANUARY (01) 31 (1) 2 3 4 5 6 (02) 7 8 9 10 11 12 13 (03) 14 15 16 17 18 19 20 (04) 21 22 23 24 25 26 27 - ------------------------------------------------------------ FEBRUARY (05) 28 29 30 31 1 2 3 (06) 4 5 6 7 8 9 10 (07) 11 12 13 14 15 16 17 (08) 18 (19) 20 21 22 23 24 - ------------------------------------------------------------ MARCH (09) 25 26 27 28 29 1 2 (10) 3 4 5 6 7 8 9 (11) 10 11 12 13 14 15 16 (12) 17 18 19 20 21 22 23 (13) 24 25 26 27 28 29 30 - ------------------------------------------------------------ APRIL (14) 31 1 2 3 4 5 6 (15) 7 8 9 10 11 12 13 (16) 14 15 16 17 18 19 20 (17) 21 22 23 24 25 26 27 - ------------------------------------------------------------ MAY (18) 28 29 30 1 2 3 4 (19) 5 6 7 8 9 10 11 (20) 12 13 14 15 16 17 18 (21) 19 20 21 22 23 24 25 - ------------------------------------------------------------ JUNE (22) 26 (27) 28 29 30 31 1 (23) 2 3 4 5 6 7 8 (24) 9 10 11 12 13 14 15 (25) 16 17 18 19 20 21 22 (26) 23 24 25 26 27 28 29 - ------------------------------------------------------------
() = U.S. HOLIDAYS
(WW) SUN MON TUES WED THUR FRI SAT - ------------------------------------------------------------ JULY (27) 30 1 2 3 (4) (5) 6 (28) 7 8 9 10 11 12 13 (29) 14 15 16 17 18 19 20 (30) 21 22 23 24 25 26 27 - ------------------------------------------------------------ AUGUST (31) 28 29 30 21 1 2 3 (32) 4 5 6 7 8 9 10 (33) 11 12 13 14 15 16 17 (34) 18 19 20 21 22 23 24 - ------------------------------------------------------------ SEPTEMBER (35) 25 26 27 28 29 30 31 (36) 1 (2) 3 4 5 6 7 (37) 8 9 10 11 12 13 14 (38) 15 16 17 18 19 20 21 (39) 22 23 24 25 26 27 28 - ------------------------------------------------------------ OCTOBER (40) 29 30 1 2 3 4 5 (41) 6 7 8 9 10 11 12 (42) 13 14 15 16 17 18 19 (43) 20 21 22 23 24 25 26 - ------------------------------------------------------------ NOVEMBER (44) 27 28 29 30 31 1 2 (45) 3 4 5 6 7 8 9 (46) 10 11 12 13 14 15 16 (47) 17 18 19 20 21 22 23 - ------------------------------------------------------------ DECEMBER (48) 24 25 26 27 (28) (29) 30 (49) 1 2 3 4 5 6 7 (50) 8 9 10 11 12 13 14 (51) 15 16 17 18 19 20 21 (52) 22 23 24 (25) 26 27 28 - ------------------------------------------------------------
*Confidential treatment requested. EXHIBIT H CHIPPAC'S RMA PROCEDURES ------------------------- (SEE ATTACHED CHIPPAC'S RMA PROCEDURES) H-1 (PROCEDURE GENERATION/REVISION HISTORY SHEET) (COVER PAGE IN KOREAN) [LOGO] - ----------------------------------------------------------------------------- (SCOPE) (TITLE) CPKR-CQ16 REV. 9 - -------------- ------------------- (ChipPAC Korea Co., Ltd.) Return Material Handling PAGE Procedure 1 OF 8 - ----------------------------------------------------------------------------- (Contents) (General Rules) (Purpose) (Scope) (Definition) (Organization) (Customer Service/Sales Department) (QA Department) (Production Depatment) (P.C Department) (Logistics Team) (Procedure) (Reception) (Verification) (Scrap or Rework) (Record Retention) - ------------------------------------------------------------------------------- (PREPRATION DEPT) (EFFECTIVE DATE) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- (TITLE) PAGE REV. CPKR-CQ18 Return Material Handling Procedure 2 OF 8 9 - ------------------------------------------------------------------------------- (General Rules) (Purpose) The administrative standard defines the procedure of the efficient handling for the return product from customer. (Scope) This administrative standard applies to the rework/rescreen flow or customer return product by product non-conformance. (Definition) 1. (Return Product) Return product is the product which is returned from customer for rework scrapping due to quality non-conformance. (Organization) (Sales: Customer service/Sales Department) Sales is responsible for belows. 1. Receiving the customer return notice. 2. Notification of the return product status to the related departments. - ------------------------------------------------------------------------------- (TITLE) PAGE REV. CPKR-CQ16 Return Material Handling Procedure 3 OF 8 9 - ------------------------------------------------------------------------------- (QA: QA Department) QA is responsible for belows. 1. Do initial verification for customer return product. But it is not required if QA engineer confirmed the defect sample before receipt of return product or customer return is caused by simple external visual reject. 2. Preparing/sending the sheet of "Rework Plan/Result Report for Customer Return". (Prod: Production Department) Prod is responsible for belows. 1. Moving return product from finished goods store to the production line. 2. Performing the rework in accordance with the rework procedure or rework schedule. 3. Fill up the sheet of "Rework Plan/Result Report for Customer Return" after rework & rescreen and submit it to QA gate along with the screened lot. (PC: Production Control Department) PC is responsible for belows. 1. Issuing the rework schedule attached the sheet of "Rework Plan/Result Report for Customer Return" after confirming the QA and process engineer. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- (TITLE) PAGE REV. CPKR-CQ16 Return Material Handling Procedure 4 OF 8 9 - ------------------------------------------------------------------------------- (LT: Logistics Team) LT (Logistics team) is responsible for belows. 1. Receiving and storing the return product. 2. Perform actual counting of the returned lot. 3. Notifying receiving status for the return product to related department. 4. Performing the re-ship the return product according to shipping request. (Procedure) (Reception) 1. Upon receive the return product notice from customer, the Sales shall inform to LT, PC, QA, Eng'g & Prod. 2. The notice shall be included as follows: -CUSTOMER: -PACKAGE/LEAD: -DEVICE/PARTS: -LOT NO: -RETURN Q'TY: -DEFECT Q'TY: -DEFECT MODE -RETURN DATE: 3. - ------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- CPKR-CQ16 (TITLE) PAGE REV. Return Material Handling Procedure 5 OF 8 9 - -------------------------------------------------------------------------------- When the return product arrives at finished goods store, LT has to segregate the return product from normal finished goods after counting actual q'ty and shall attach the return/hold label on the boxes of return product. 4. LT informs the arrival status of return product to Sales, PC, QA and relevant departments by E-mail or written information. 10. (Verification) 1. When the LT dept notifies the customer return after customer clearance, QA engineer shall perform the verification for returned lot as follows: (1) (Visual Inspection) If necessary, the QA engineer shall verify the reject units or some samples selected randomly from returned lot whether those are agreed with the customer's information. (2) If failure analysis is required, responsible engineer request failure analysis to F/A and then the confirm the result whether it agreeds with customer's information. (3) If any disagreement items are found through above verification, the QA engineer shall report those status to customer through Sales. 2. QA shall decide the rework & rescreen method with the sheet of "Rework Plan/Result Report for Customer Return" and inform PC to issue rework schedule. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- CPKR-CQ16 (TITLE) PAGE REV. Return Material Handling Procedure 6 OF 8 9 - -------------------------------------------------------------------------------- 1. After receipt the rework method from the QA, PC shall issue the rework schedule. 2. Prod shall transfer the return product from finished good store to the production line when the rework schedule is approved. 3. Prod shall perform the rework in accordance with rework procedure on the schedule sheet. 4. Reworked product shall be verified by inspection and test plan. 5. Process eng'r or Prod supervisor shall verify production rework & rescreen status and then comment his own opinion. If necessary, he should establish additional action item & then record it on the sheet of "Rework Plan / Result Report for Customer Return". 6. Prod shall submit the return lot attaching the sheet of "Rework Plan / Result Report for Customer Return" to QA gate after completion of rework/rescreen. 7. QA shall verify the sheet of "Rework Plan / Result Report for Customer Return" and verify customer returned lot in accordance with required inspection plan. 8. The customer return product without QA verification is not allowed to ship to customer. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- CPKR-CQ16 (TITLE) PAGE REV. Return Material Handling Procedure 7 OF 8 9 - -------------------------------------------------------------------------------- 1. QA shall keep the "Rework Plan / Result Report for Customer Return" sheet for minimum 3 years. 1. This procedure is controlled by "Quality Manual (CPKR-CB03)", 1. The Sheet of "Rework Plan / Result Report for Customer Return". - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- CPKR-CQ16 (TITLE) PAGE REV. Return Material Handling Procedure 8 OF 8 9 - -------------------------------------------------------------------------------- ATTACHMENT: The Sheet of "Rework Plan/Result Report for Customer Return". Rework Plan/Result Report for Customer Return - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Customer Pkg/LD Device Name Lot number Q'ty Return reason ================================================================================ - -------------------------------------------------------------------------------- (RETURN SAMPLE VERIFICATION): - -------------------------------------------------------------------------------- (REWORK PLAN): - -------------------------------------------------------------------------------- No (ITEMS) (REWORK METHOD/SPEC) (s/s) (RESP.) (REACTION PLAN) ================================================================================ - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 1999, Prepared by QA eng'r ---------------- Approved by QA Manager ---------------- - -------------------------------------------------------------------------------- (REWORK DATA): - -------------------------------------------------------------------------------- Data Summary Reject/Rework Mode details - -------------------------------------------------------------------------------- Input Q'ty - -------------------------------------------------------------------------------- Out Q'ty - -------------------------------------------------------------------------------- Scrap Q'ty - -------------------------------------------------------------------------------- Rework Q'ty - ------------------------------------------------------------------------------- 1999, Prepared by Product Supr'v ---------------- - ------------------------------------------------------------------------------- ENGINEERING COMMENT: - ------------------------------------------------------------------------------- 1999, Prepared by Process Eng'r ---------------- 1999, Confirmed by Process QA ---------------- - ------------------------------------------------------------------------------- -----END PRIVACY-ENHANCED MESSAGE-----