SANDISK AND SAMSUNG RENEW PATENT CROSS LICENSE AND FLASH SUPPLY AGREEMENTS
MILPITAS, CALIFORNIA and SEOUL, KOREA, MAY 27,
2009 - SanDisk® (NASDAQ: SNDK) and Samsung Electronics
Co., Ltd. announced today that they signed a definitive agreement
to renew the cross license of their semiconductor patent
portfolios. In addition, the companies signed a flash memory supply
agreement under which Samsung will continue to make available to
SanDisk a guaranteed portion of its flash memory production output.
The new agreements become effective when the current cross license
and supply agreements expire on August 14, 2009, and will run for
seven years from that date.
The new patent cross-license agreement includes rights to each
party's patents broadly covering multi-level cell flash memory and
flash storage systems, but does not license either party's patent
claims specific to 3-D memory technology. Over the life of the new
license, the estimated effective rate of the fixed payments and
royalties is expected to be approximately half of the effective
rate in recent years under the current license. Financial terms of
the agreements were not disclosed.
"We are very pleased with the agreements announced today. We
believe that they represent good value for our stockholders and
enable both parties to focus on the growth markets at hand. We are
excited about our opportunities in mobile, computing and consumer
flash storage markets. Furthermore, continued access to Samsung's
flash capacity under competitive terms gives us greater flexibility
in managing our future capital expenditures for captive capacity.
We look forward to a constructive relationship with Samsung in the
years ahead." said Dr. Eli Harari, chairman and chief executive
officer, SanDisk.
"The renewal agreements enable Samsung and SanDisk to each focus
their energies on restoring flash market growth. It is clear that
these renewal agreements are aimed at strengthening the on-going
business relationship between Samsung and SanDisk, and we are
pleased that the two companies have worked hard to achieve a
significantly improved balance on the patent license." said Dr.
Oh-Hyun Kwon, president of the Semiconductor Business, Samsung
Electronics.
SanDisk's Investor Conference Call
SanDisk will hold a brief conference call today for its financial
analysts and investors at 2:30 p.m. PDT/5:30 p.m. EDT. To
participate in the call, please call +1 719-325-4775 with the
following passcode: 8909494.
SanDisk's Forward-Looking Statements
This press release contains certain forward-looking statements,
including statements about expectations regarding the benefits of
the renewal license agreement, the expected effective royalty rates
thereunder, market opportunities for flash memory including mobile,
computing and consumer flash storage markets, and the expected
benefits of the flash memory supply agreement that are based on
SanDisk's current expectations and involve numerous risks and
uncertainties that may cause these forward-looking statements to be
inaccurate. Risks that may cause these forward-looking statements
to be inaccurate include among others: Samsung's failure to perform
its obligations under the license or supply agreement, the size and
growth rate of Samsung's flash memory business, slower than
expected, or no, growth in market demand for flash memory products
in current and new markets, SanDisk's ability to reduce its captive
supply capital expenditure requirements due to the supply agreement
with Samsung, whether the pricing terms under the supply
agreement result in cost-competitive supply as compared to other
captive and non-captive sources, and other risks detailed from
time-to-time in SanDisk's Securities and Exchange Commission
filings and reports, including, but not limited to, under the
caption "Risk factors" and elsewhere in SanDisk's most recent
annual report on Form 10-K and SanDisk's subsequent quarterly
reports on Form 10-Q. The parties do not intend to update the
information contained in this release.
About SanDisk
SanDisk Corporation, the inventor and world's largest supplier of
flash storage cards, is a global leader in flash memory - from
research, manufacturing and product design to consumer branding and
retail distribution. SanDisk's product portfolio includes flash
memory cards for mobile phones, digital cameras and camcorders,
digital audio/video players, USB flash drives for consumers and the
enterprise, embedded memory for mobile devices, and solid state
drives for computers. SanDisk (www.sandisk.com/corporate)
is a Silicon Valley-based S&P 500 company, with more than half
its sales outside the United States.
About Samsung Electronics
Samsung Electronics Co., Ltd. is a global leader in semiconductor,
telecommunication, digital media and digital convergence
technologies with 2008 consolidated sales of US$96 billion.
Employing approximately 150,000 people in 134 offices in 62
countries, the company consists of two business units: Digital
Media & Communications and Device Solutions. Recognized as one
of the fastest growing global brands, Samsung Electronics is a
leading producer of digital TVs, memory chips, mobile phones and
TFT-LCDs. For more information, please visit www.samsung.com.
| SanDisk Contacts: |
Samsung Contact: |
Media Contact:
Ryan Donovan
(408) 801-2857
ryan.donovan@sandisk.com
Investor Contacts:
Jay Iyer
(408) 801-2067
|
Media Contact:
Reece Hwang
+82 2255 8278 |