Semiconductor Manufacturing International Corporation: Matters in Respect of Settlement Agreement With TSMC
28 August 2006 - 9:30PM
PR Newswire (US)
SHANGHAI, China, Aug. 28 /Xinhua-PRNewswire/ -- * The Stock
Exchange of Hong Kong Limited takes no responsibility for the
contents of this announcement, makes no representation as to its
accuracy or completeness and expressly disclaims any liability
whatsoever for any loss howsoever arising from or in reliance upon
the whole or any part of the contents of this announcement.
SEMICONDUCTOR MANUFACTURING INTERNATIONAL CORPORATION (Incorporated
in the Cayman Islands with limited liability) (STOCK CODE: 0981)
Matters in Respect of Settlement Agreement With TSMC --
Semiconductor Manufacturing International Corporation ("SMIC" or
the "Company") hereby announces that it has been informed of the
filing of a complaint instituting a lawsuit by Taiwan Semiconductor
Manufacturing International Corporation ("TSMC") in respect of an
alleged breach of the settlement agreement entered into between the
Company and TSMC on January 30, 2005 concerning patents and trade
secret litigations between the Company and TSMC ("Settlement
Agreement"). Details of the Settlement Agreement are disclosed in
the Company's announcement published on January 31, 2005. -- This
announcement is made pursuant to the disclosure obligations under
Rule 13.09(1) of The Rules Governing the Listing of Securities on
The Stock Exchange of Hong Kong Limited in order to enable
investors and the public to appraise the position of the group.
Semiconductor Manufacturing International Corporation ("SMIC" or
the "Company") hereby announces that it has been informed of the
filing of a complaint instituting a lawsuit by Taiwan Semiconductor
Manufacturing International Corporation ("TSMC") in respect of an
alleged breach of the settlement agreement entered into between the
Company and TSMC on January 30, 2005 concerning patents and trade
secret litigations between the Company and TSMC ("Settlement
Agreement"). Details of the Settlement Agreement are disclosed in
the Company's announcement published on January 31, 2005. As
disclosed in the said announcement, pursuant to the Settlement
Agreement, SMIC has agreed to pay TSMC $175 million, payable in
installments over six years ($30 million in each of the first five
years and $25 million in the sixth year) (of which US$45 Million
has already been paid). In addition, the two parties have agreed to
cross license to each other's patent portfolio through December
2010. The Settlement Agreement also provides for the dismissal of
all pending legal actions without prejudice between the two
companies in U.S. District Court, California State Superior Court,
the U.S. International Trade Commission, and Taiwan District Court
as well. In the Settlement Agreement, TSMC has covenanted not to
sue SMIC for itemized acts of trade secret misappropriation as
alleged in the complaints, although the settlement does not grant a
license to use any of TSMC's trade secrets. The patent cross
license and Settlement Agreement are terminable upon a breach by
SMIC, which may result in the reinstitution of the legal
proceedings and acceleration of the outstanding payments under the
Settlement Agreement. Since the Settlement Agreement with TSMC in
January 2005, SMIC has worked diligently to honour the agreement
and has complied with its terms. SMIC is very shocked by and deeply
disappointed with the actions of TSMC and believes their actions
are brought in bad faith. Whilst SMIC will fight the lawsuit and
defend and protect our interests, SMIC urges TSMC to act reasonably
and honour the Settlement Agreement we reached. As at the date of
this announcement, the directors of the Company are Yang Yuan Wang
as Chairman of the Board of Directors and Independent Non-Executive
Director of the Company; Richard R. Chang as President, Chief
Executive Officer and Executive Director of the Company; Fang Yao
as Non-Executive Director of the Company; and Ta-Lin Hsu, Tsuyoshi
Kawanishi, Henry Shaw, Lip- Bu Tan, Albert Y. C. Yu and Jiang Shang
Zhou as Independent Non-Executive Directors of the Company.
Semiconductor Manufacturing International Corporation Richard R.
Chang Chief Executive Officer Shanghai, PRC August 28, 2006 Please
also refer to the published version of this announcement in The
Standard. For more information, please contact: SMIC Shanghai Reiko
Chang SMIC Public Relations Department Tel: +86-21-5080-2000 x10544
Email: SMIC Hong Kong Calvin Lau / Mei Fung Hoo Tel: +852-9435-2603
/ +825-2537-8480 Email: / DATASOURCE: Semiconductor Manufacturing
International Corporation CONTACT: Reiko Chang of SMIC Shanghai,
+86-21-5080-2000 x10544, or ; Calvin Lau or Mei Fung Hoo of SMIC
Hong Kong, +852-9435-2603 or +825-2537-8480, or or Web Site:
http://www.smics.com/
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