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Exhibit 10.32
COST REDUCTION PROGRAM FOR uBGA PACKAGING
AGREEMENT:
This Agreement on a Cost Reduction Program ("Program") for uBGA Packaging is
made as of August 25, 2000 between Tessera, Inc. ("Tessera"), a Delaware
Corporation and Decision Track, LLC ("Decision Track"), a California Limited
Liability Corporation and Thomas H. Di Stefano ("Di Stefano"), an individual
(Decision Track and Di Stefano are collectively referred to as "Consultants").
OBJECTIVE:
The overall objective of the Program is to provide a Roadmap for cost reduction
and performance improvement of the uBGA package. The Program will implement
segments of the Roadmap, including technology, intellectual property,
demonstration and partners, as mutually agreed by the Parties.
SCOPE:
The scope of the Program includes the individually assembled uBGA package along
with the materials, substrates and manufacturing equipment necessary for
simplification and cost reduction. The target for cost reduction is to 50% of
the total manufacturing cost with the 4.0 process, as demonstrated on a DRAM
package. Implementation of the Program is broken down into a number of separate
segments that may be implemented to achieve the target cost reduction.
The Scope does not include non-related IC packaging technologies such as wafer
level packaging, burn-in and test. No information or rights are to be exchanged
between the parties outside of the Scope of the Agreement.
DEMONSTRATION:
The demonstration vehicle for the cost reduction Program is the Rambus 256M
RDRAM, or other test chip mutually agreed upon by the Parties in this Agreement.
Chip Scale Packages and substrates that are representative of those needed for
the current and future memory applications in are to be built and tested.
ROADMAP:
Consultants shall outline a Roadmap for the Cost Reduction Program that is
updated from time to time as improvements are made. The Roadmap is to be a
guideline in planning specific implementations of the Program. Tessera is under
no obligation to implement any of the elements of the Roadmap.
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IMPLEMENTATION:
Consultants will propose specific Implementation Plans for realizing the
Roadmap. By mutual agreement between Tessera and Consultants, the plans will be
executed. To the extent possible, the Implementation Plans for each element are
to be independently executable. Although the exact scope of work and
compensation for each are to be determined by mutual agreement, several specific
candidates for implementation by Consultants are listed below.
High Performance Substrates
A technology and initial samples of material for two and three metal substrates
is to be demonstrated. An initial supplier is to be identified and brought up
to a level where it can supply samples for use in assembling (micro)BGA
packages.
Encapsulation Process
The complications and associated costs of encapsulation are to be eliminated by
reduction or elimination of the cover-lay material, material applicable and
material removal.
Die Attach Process
The die attach process, with the associated pad/nubbin process and materials,
is to be simplified, eliminating the cost and expense of the spacer structure.
Materials and equipment suppliers shall be brought up to support the process.
Turnkey Automation of the Assembly Process
A fully automated process for low cost production shall be demonstrated in a
showcase line. An equipment vendor will be recruited to supply automated lines
for assembly of (micro)BGA packages to Tessera Licensees. A showcase line is
proposed for Malaysia/Singapore, with participation by the respective economic
development agencies.
COMMUNICATIONS:
Consultants will meet periodically with designated Tessera employees to provide
updates and consulting to Tessera. Communications on specific implementations
are to be arranged as part of the overall Program.
Internet connections will be used to speed communications between participants
including substrate suppliers, IC assemblers, technology providers and the
customers. Implementations are to be documented in reports to Tessera in a form
suitable for use in technology transfer and training.
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COMPENSATION:
Compensation to begin the cost reduction Program is a grant of options to
Thomas H. Di Stefano for 330,000 shares of Tessera Common Stock at an exercise
price of no greater than $3.00 per share and an exercise period of two years
from the date of grant.
During the term of the Program, a retainer of $5,000 per month will be paid to
Consultants for basic consulting on cost reduction and the roadmap of
improvements. Tessera shall reimburse pre-approved expenses incurred for travel
and other consulting.
Deliverables and compensation for each of the Implementations is to be mutually
agreed upon, after specifics of the each Implementation Plan are set. Neither
Tessera nor Consultants have an obligation to proceed with any of the
Implementation Plans. Correspondingly, no intellectual property to be developed
in each Implementation Plan shall be transferred between the Parties until the
corresponding Implementation Plan is accepted.
INTELLECTUAL PROPERTY:
Intellectual Property shall not be transferred by Consultants to Tessera except
as agreed upon by the Parties for each specific Implementation Plan.
Consultants shall grant Tessera a permanent, exclusive, sub-licensable, paid
up, royalty free worldwide license to the patents and technology developed
within each of the agreed upon Implementation Plans ("Program Inventions") to
make, have made, use and sell products; alternatively Consultants may assign
all right, title and interest in Program Inventions to Tessera.
PERSONNEL:
Work done to carry out the Implementation Plans shall be done by Consultants
and their employees, and the results communicated to a designated contact
person at Tessera.
CONFIDENTIALITY:
All Confidential Information associated with the Cost Reduction Program is to
be protected by a standard non-disclosure agreement between the Parties.
Confidential Information shall be limited to that which lies within the Scope
of this Agreement. Each party shall protect the Confidential Information with
at least the same diligence used in its other areas of business.
TERMS:
The Term of the Program is for a maximum of one year from the effective date of
this Agreement. The Program can be terminated at the discretion of either
party by a written notice delivered thirty days before termination.
Non-disclosure and Intellectual Property rights survive termination.
GENERAL:
The relationship of Consultants to Tessera will be that of independent
contractors. This Agreement is the entire agreement of the Parties with respect
to the subject matter hereof, and supersedes any prior agreements,
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whether verbal or written, whether express or implied,
concerning this subject.
AGREED: Tessera, Inc. Thomas Di Stefano
By: /s/ [Signature Illegible] By: /s/ THOMAS DI STEFANO
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Its: CEO
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Date: August 28, 2000 Date: August 25, 2000
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Decision Track, LLC
By: /s/ THOMAS DI STEFANO
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Its: President
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Date: August 25, 2000
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TESSERA CONFIDENTIAL
FIRST AMENDMENT TO
AGREEMENT ON COST REDUCTION PROGRAM
This First Amendment to the Agreement on Cost Reduction ("First
Amendment") is entered into as of August 30, 2000 ("First Amendment Effective
Date") between Tessera, Inc., Decision Track, LLC ("Decision Track"), and
Thomas H. Di Stefano ("Di Stefano"), and amends the Agreement on Cost Reduction
("Cost Reduction Agreement") entered into by and between the parties having an
Effective Date of August 25, 2000.
WHEREAS, the parties desire to change the terms under which they
provide services and support to each other under the Technology Agreement; and
WHEREAS, the parties desire to amend the Cost Reduction Agreement to
incorporate such changes.
1. Compensation, is amended by replacing the first sentence with the
following sentence:
Compensation to begin the cost reduction Program is a grant of
options to Thomas H. Di Stefano for 330,000 shares of Tessera Common
Stock and to Anthony Faraci for 30,000 shares of Tessera Common Stock
both at an exercise price of no greater than $3.00 per share and an
exercise period of two years from the date of grant.
Except as modified by this First Amendment, the remaining terms and
conditions of the Cost Reduction Agreement are unchanged and apply with equal
force and effect.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
First Amendment by their duly authorized representatives as of the date first
above written.
TESSERA, INC. THOMAS DI STEFANO
By: /s/ [Signature Illegible] By: /s/ THOMAS DI STEFANO
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Its: CFO
Date: Sept 7, 2000 Date: September 3, 2000
DECISION TRACK, LLC
By: /s/ THOMAS DI STEFANO
Its: President
Date: September 3, 2000
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