Manufacturing Services Agreement

Exhibit 10.30


MANUFACTURING SERVICES AGREEMENT


THIS MANUFACTURING SERVICES AGREEMENT (this " Agreement" ) is made and entered into as of June 30, 2003 (the " Effective Date" ), by and between FASL LLC, a Delaware limited liability company (" FASL" ), and Fujitsu Limited, a corporation organized under the laws of Japan (" Fujitsu" ). FASL and Fujitsu are hereinafter also referred to as the " Parties" and individually as a " Party ."

RECITALS

WHEREAS , Advanced Micro Devices, Inc., a Delaware corporation (" AMD" ) and Fujitsu previously entered into a joint venture arrangement, and formed Fujitsu AMD Semiconductor Limited, a corporation organized under the laws of Japan (" FASL (Japan)" ), for the purpose of manufacturing wafers for flash memory products;

WHEREAS , pursuant to the Amended and Restated LLC Operating Agreement, dated June 30, 2003 (the " LLC Operating Agreement" ), among FASL, AMD, AMD Investments, Inc., a Delaware corporation (" AMDI" ), Fujitsu, and Fujitsu Microelectronics Holding, Inc., a Delaware corporation (" FMH" ), and the Contribution and Assumption Agreement (the " Contribution Agreement" ), among AMD, AMDI, Fujitsu, FMH and FASL, AMD and Fujitsu have formed FASL for the purpose of engaging in the Business, including the operations of FASL (Japan);


WHEREAS , prior to the Effective Date, Fujitsu has provided certain manufacturing processes for FASL (Japan); and


WHEREAS , in connection with the execution of the LLC Operating Agreement and the Contribution Agreement and the transactions contemplated thereby, Fujitsu and FASL have agreed that Fujitsu will continue to perform certain manufacturing processes on behalf of FASL, on the terms and conditions set forth below.

NOW, THEREFORE , in consideration of the mutual representations, warranties, covenants and other terms and conditions contained herein, FASL and Fujitsu agree as follows:


AGREEMENT 1. DEFINITIONS; INTERPRETATION

1.1 Capitalized but Undefined Terms . Capitalized terms used in this Agreement but not defined herein shall have the meaning ascribed to such terms in the LLC Operating Agreement.


1.2 Terms Defined in this Agreement . The following terms when used in this Agreement shall have the following definitions:

1.2.1 " Best Efforts" means the efforts that a prudent Person desiring to achieve a particular result would use in order to achieve such result reasonably expeditiously. An obligation to use " Best Efforts" does not require the Person subject to such obligation to

take actions that would result in a materially adverse change in the benefits to such Person of this Agreement.

1.2.2 " Confidential Information" has the meaning set forth in Section 8.1.


1.2.3 " Disclosing Party" has the meaning set forth in Section 8.1.


1.2.4 " Fiscal Quarter" means a fiscal quarter of FASL during the Term.

1.2.5 " Force Majeure" has the meaning set forth in Section 12.9.1.

1.2.6 " Month" means a calendar month during the Term, based on local time in Japan.


1.2.7 " Purchase Order" has the meaning set forth in Section 4.1.1.


1.2.8 " Receiving Party" has the meaning set forth in Section 8.1.

1.2.9 " Serviced Product" means any Unfinished Product with respect to which Fujitsu has performed and completed Services, in accordance with the terms and conditions of this Agreement.


1.2.10 " Services" means any of the manufacturing processes set forth on Schedule 1.2.10 consistent with the past practices of Fujitsu and FASL (Japan) with respect to services.

1.2.11 " Term" has the meaning set forth in Section 11.1.


1.2.12 " Transaction Documents" has the meaning set forth in the Contribution Agreement.


1.2.13 " Unfinished Product" means any semiconductor wafer, semiconductor chip, semiconductor die or semiconductor work-in-progress that FASL delivers to Fujitsu for purposes of performing Services in connection with the Business.


1.2.14 " Yield" means the ratio of (a) the number of Serviced Products which comply with Fujitsu' s warranties hereunder to (b) the corresponding number of Unfinished Products provided to Fujitsu by FASL in the performance of Services.


1.3 Interpretation .

1.3.1 Certain Terms . The words " hereof," " herein," " hereunder" and similar words refer to this Agreement as a whole and not to any particular provision of this Agreement. The term " including" is not limited and means " including without limitation."


1.3.2 Section References; Titles and Subtitles . Unless otherwise noted, all references to Sections, Schedules and Exhibits herein are to Sections, Schedules and Exhibits of this Agreement. The titles, captions and headings of this Agreement are inserted for convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.

1.3.3 Reference to Entities, Agreements, Statutes . Unless otherwise expressly provided herein, (a) references to an Entity or person include its successors and permitted assigns, (b) references to agreements (including this Agreement) and other contractual instruments shall be deemed to include all subsequent amendments, restatements and other modifications thereto or supplements thereof and (c) references to any statute or regulation are to be construed as including all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such statute or regulation.

2. SERVICES

2.1 Order and Performance . FASL, on behalf of itself and, consistent with the provisions of Section 6, its subsidiaries, shall purchase from Fujitsu, and Fujitsu shall provide, or cause to be provided, to FASL or FASL' s subsidiary, as applicable, during the Term, Services under binding Purchase Orders delivered by FASL to Fujitsu and accepted by Fujitsu as provided herein.


2.2 Outsourcing . Fujitsu shall have the right, in its sole discretion, to outsource, assign or subcontract the performance of any of its obligations hereunder to any Person, including to any Fujitsu subsidiary or affiliate, consistent with Section 12.5; provided, however, that any such assignment or subcontract of performance shall not release Fujitsu from its responsibility for its obligations under this Agreement.

2.3 Yield . In the event there is a material problem with respect to Yield and (a) FASL determines in good faith that the cause of the problem is attributable to the Services or materials provided by Fujitsu, or (b) Fujitsu determines in good faith that the cause of the problem is attributable to the quality of the Unfinished Products or other materials provided by FASL, then the Party making such determination shall provide notice thereof to the other Party. Upon delivery of such notice, the Parties shall meet and discuss in good faith, fair compensation (if appropriate) to be paid by one Party to the other Party for the costs, expenses and other damages associated therewith.


2.4 High Temperature Probe Testing; Chip Processing; Mask and Reticle Manufacturing Services . As soon as practicable following the Effective Date, the Parties shall meet and discuss in good faith the provision of high temperature probe testing, chip processing and mask and reticle manufacturing services by Fujitsu to FASL and FASL' s Affiliates on terms substantially similar to the terms set forth in this Agreement and on price terms negotiated in good faith by the Parties. Upon reaching such agreement, the Parties shall enter into an agreement substantially similar to this Agreement for the provision of such services.

3. FORECASTS

Within twenty (20) days prior to the commencement of each Fiscal Quarter during the Term, FASL shall provide Fujitsu with a written or electronic nonbinding, rolling forecast of its planned usage of Services for each of the following twenty-six (26) weeks broken down by (a) the type and quantity of Services expected to be ordered during each Month, (b) the applicable FASL product(s), (c) expected requested delivery date(s) and place(s) of delivery of Serviced Products and (d) other relevant information as the Parties may agree. 4. PACKAGING TERMS AND ADDITIONAL AGREEMENTS

4.1 Purchase Orders .

4.1.1 Quarterly Purchase Orders . Within ten (10) days following the date hereof and thereafter within ten (10) days prior to the commencement of each Fiscal Quarter during the Term, FASL shall order and purchase Services from Fujitsu for the following Fiscal Quarter by issuing to Fujitsu a written blanket purchase order in a form reasonably acceptable to the Parties (" Purchase Orders" ), provided that the Purchase Order issued within ten (10) days after the date hereof shall apply to the current third (3 rd ) Fiscal Quarter of 2003. Each Purchase Order shall be binding upon the Parties upon acceptance by Fujitsu (it being agreed that Fujitsu shall have no obligation to accept Purchase Orders hereunder). In the event that Fujitsu fails reject (in whole or in part) in writing any order issued by FASL within five (5) business days (in Japan) after Fujitsu' s receipt thereof, then such order shall be deemed to have been accepted by Fujitsu. In the third (3 rd ) and fourth (4 th ) Fiscal Quarters of 2003 and, subject to Sections 5.2.2 and 5.2.3, the first (1 st ) Fiscal Quarter of 2004, Fujitsu shall have the exclusive right to supply Services with respect to those package types and other matters that have been previously qualified by Fujitsu. Except as set forth in the previous sentence, nothing herein shall be deemed to grant to Fujitsu exclusivity with respect to performance of Services.

4.1.2 Purchase Order Requirements; Inconsistency . Each Purchase Order shall contain (a) the type and quantity of Services expected to be ordered during such Fiscal Quarter (provided that such quantity estimates shall be non-binding), (b) the applicable FASL product(s), (c) expected delivery date(s), (d) place(s) of delivery for Serviced Products, (e) price(s) (consistent with the provisions of Section 5) and (f) other relevant information as the Parties may agree. In no event shall Fujitsu be required to perform Services in excess of levels set forth in the applicable Purchase Orders. In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of a Purchase Order, the terms and conditions of the Purchase Order shall prevail.


4.1.3 Lead Times; Fujitsu Delivery . Fujitsu shall ship all Serviced Products in accordance with the delivery schedule contained in the applicable Purchase Order, and shall promptly notify and consult with FASL in case of any expected delays in shipping Serviced Products. Fujitsu shall deliver Serviced Products to such locations set forth on the applicable Purchase Order, or as otherwise instructed by FASL from time to time.

4.1.4 Termination of Services for Products . In the event that FASL intends to stop delivering Purchase Orders for Services with respect to any Products, it shall deliver to Fujitsu four (4) months' prior written notice thereof, provided that (subject to the provisions of Section 5.2 below) no such notice shall be delivered prior to December 1, 2003.

4.2 Shipping . FASL shall be responsible for all costs and expenses arising from the (a) shipment to Fujitsu of Unfinished Products and other materials provided to Fujitsu for Fujitsu' s performance of Services hereunder, and (b) return shipment from Fujitsu as instructed by FASL of Serviced Products and other materials provided to Fujitsu that are no longer needed by Fujitsu for the performance of Services hereunder.

4.3 Consignment and Use of Materials .

4.3.1 Consignment Basis . FASL shall consign to Fujitsu, on a no-charge basis, Unfinished Products in good quality and suitable for Fujitsu to use for the purpose of performing the Services in connection with the Business. Title and right of possession to all Unfinished Products shall at all times remain with FASL. Liability for loss of or damage to Unfinished Product will pass to Fujitsu upon the delivery of the Unfinished Products to Fujitsu. In the event of any loss or irreparable damage to Unfinished Products while in the control of Fujitsu not related to normal yield loss, Fujitsu will (a) replace such Unfinished Products or (b) compensate FASL within thirty (30) days for FASL' s replacement cost of a replacement item. FASL shall provide Unfinished Products to Fujitsu in amounts and at times as reasonably agreed by the Parties in order for Fujitsu to perform the Services ordered by FASL.

4.3.2 Materials . Fujitsu shall be responsible for acquiring materials not provided by FASL and which are necessary for Fujitsu to perform the Services hereunder; provided, however, that in the event FASL reduces any Services to be performed below the level therefor set forth in the Forecasts delivered under Section 3, then FASL shall reimburse Fujitsu for the cost of such materials to the extent such materials were acquired by Fujitsu in anticipation of meeting the levels set forth in such Forecasts (although FASL shall not be obligated to reimburse Fujitsu for materials if Fujitsu (or its applicable subcontractor) could readily use such materials in other planned activities); provided further, however, Fujitsu will not maintain in excess of a reasonable amount of materials in respect of expected lead times for Services to be performed hereunder.


4.3.3 Fujitsu Obligations . Fujitsu shall segregate all Unfinished Products and other materials provided by FASL hereunder separate and apart from other property of or held by Fujitsu (other than those materials described in Section 4.3.2), and shall maintain and safeguard such Unfinished Products and other materials with reasonable care. Fujitsu shall use all Unfinished Products and other materials provided by FASL hereunder only for purposes of providing Services to FASL pursuant to the terms hereof. Fujitsu shall promptly notify FASL of any Unfinished Products and other materials provided by FASL hereunder that exhibit external damage at the time of delivery from FASL to Fujitsu and shall follow FASL' s instructions with respect to such damaged Unfinished Products and materials.


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