EXHIBIT 10.6
PATENT INDEMNIFICATION AGREEMENT
This PATENT INDEMNIFICATION AGREEMENT, dated and effective as of September 10,
2004, is entered into by and among, on one side, Toshiba Corporation, a Japanese
corporation ("Toshiba"), and, on the other side, SanDisk Corporation, a Delaware
corporation ("SanDisk Corporation") [***] "SanDisk," and SanDisk together with
Toshiba, the "Parties").
WHEREAS, Toshiba and SanDisk are parties to that certain Flash Partners
Master Agreement, dated as of the date hereof (the "Master Agreement");
[***]
WHEREAS, recognizing that the products SanDisk will acquire from the
Company will have been manufactured using Toshiba patents and technology, and
recognizing that SanDisk, as an owner of the equity interests in the Company,
will benefit from Toshiba's making available its patents and technology to the
Company, the Parties have determined to enter into this Agreement, which is
required by the Master Agreement.
NOW, THEREFORE, the Parties agree as follows:
1. INDEMNIFICATION.
1.1 Patent Infringement. With regard to any and all sales of Y3 NAND Flash
Memory Products by the Company to SanDisk ("Company Products"):
(a) Subject to the terms and conditions listed below, Toshiba agrees to
indemnify and defend SanDisk in any legal proceeding, lawsuit or other
judicial action, and [***] against SanDisk [***], for [***] claims that
the Company Products supplied by the Company infringe any [***] patent(s).
With regard to any claim of patent infringement for which Toshiba has
indemnification obligations hereunder, Toshiba's obligations are subject
to the following conditions:
(i) SanDisk shall notify Toshiba in writing of such claim [***];
(ii) SanDisk shall also notify Toshiba, in writing [***] by a third party
which claims that the Company Products infringe such third party's
patents or threatens legal action against SanDisk, [***];
(iii) SanDisk shall provide Toshiba with notice of any other written
communication indicating potential patent infringement claims
against the Company Products [***]; provided, however, SanDisk's
failure to provide such notice shall in no way constitute a breach
of this Agreement by SanDisk nor in any way excuse Toshiba's
obligations under this Agreement;
CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
[***] INDICATES THAT CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24B-2. CONFIDENTIAL TREATMENT
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(iv) [***], Toshiba shall have the sole and exclusive control of the
defense or settlement of such claim, [***]; and
(v) SanDisk shall provide all reasonable assistance in defending such
claim.
(b) Notwithstanding the foregoing, Toshiba shall not be obligated to indemnify
or defend SanDisk in the event that such infringement arises from:
(i) [***]
(ii) [***]
(iii) [***]
(c) [***]
(d) [***]
(e) In addition to the obligations set forth above, should any third party
patent claim result in a temporary or permanent injunction against the
manufacture, use, sale, offer for sale, importation or otherwise disposal
of the Company Products by SanDisk, Toshiba shall use best efforts to
undertake one of the following actions:
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(f) The total cumulative liability of Toshiba under this Agreement, exclusive
of the remedy set forth in subparagraph (e), above, shall be limited to an
amount not to exceed the greater of (x) [***] (y) [***].
1.2 [***]
(a) If either Party receives a notice of a [***] or becomes aware that the
Company has received such a notice, it shall promptly notify the other
Party. Promptly following the notified Party's receipt of such notice from
the notifying Party, the Parties shall meet and discuss in good faith
whether and how [***], in accordance with the principles set forth in
Section 1.2(b).
(b) In discussing and evaluating [***], Toshiba and SanDisk shall discuss and
agree upon [***].
(c) If despite their good faith efforts the Parties are not able to agree upon
[***] pursuant to Section 1.2(b) for [***], the matter shall be resolved
in accordance with the dispute resolution procedures set forth in the
Master Agreement.
(d) [***].
1.3 [***]
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SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24B-2. CONFIDENTIAL TREATMENT
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2. TERMINATION
This Agreement shall terminate [***] and upon such termination, this
Agreement shall be of no further force and effect, and Toshiba and SanDisk
shall thereafter have no liability hereunder.
3. MISCELLANEOUS
3.1 Certain Definitions and Interpretive Rules.
(a) As used herein, the term "Agreement" means this Patent Indemnification
Agreement together with any exhibits, schedules, appendices and
attachments hereto.
(b) Capitalized terms used but not defined in the main body of this Agreement
shall have the respective meanings assigned to them in attached Appendix
A. If any capitalized term used in this Agreement is not defined in either
the main body of this Agreement or Appendix A, it shall have the meaning
assigned to it in the Master Agreement.
(c) The rules of construction and documentary conventions and general terms
and conditions set forth in Appendix A shall apply to this Agreement.
3.2 [***]
3.3 Survival. Except as otherwise specifically provided in this Agreement, all
covenants, agreements, representations and warranties of the Parties made
in or pursuant to such agreement or instrument shall survive the execution
and delivery of such agreement or instrument and the closing of the
transactions contemplated thereby, notwithstanding any investigation by or
on behalf of any party. Further, the provisions set forth in this Article
III shall survive and shall apply with respect to this Agreement following
termination thereof pursuant to Article II hereof.
3.4 Assignment. Neither Party shall transfer, or grant or permit to exist any
Lien (except Permitted Liens) on, this Agreement or any of its rights
hereunder, (except for any transfer to an Affiliate or in connection with
a merger, consolidation or sale of all or substantially all the assets or
the outstanding securities of such Party, which transfer shall not require
any consent of the other Party) without the prior written consent of the
other Party (which consent may be withheld in each such other Party's sole
discretion), and any such purported transfer or Lien without such consent
shall be void. [***].
3.5 Governing Law. This Agreement shall be governed and construed as to all
matters including validity, construction and performance by and under the
substantive laws of the State of California.
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and
delivered as of the date and year first above written.
TOSHIBA CORPORATION
By: /s/ Masashi Muromachi
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Name: Masashi Muromachi
Title: President and CEO
Semiconductor Company
Corporate Vice President
SANDISK CORPORATION
By: /s/ Eli Harari
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Name: Eli Harari
Title: President and CEO
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[Signature page to Patent Indemnification Agreement]
[***] INDICATES THAT CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO RULE 24B-2. CONFIDENTIAL TREATMENT
HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
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