ChipMOS to terminate Spansion's services

HSINCHU, Taiwan: ChipMOS TECHNOLOGIES (Bermuda) Ltd announced that on January 19, 2009 its wholly owned subsidiary ChipMOS Technologies Inc. delivered a notice of breach and notice of intent to terminate a service agreement with Spansion LLC in the US pursuant to the terms of the service agreement.

Spansion currently has an outstanding account receivable with ChipMOS Taiwan of approximately US$57 million of which approximately US$18 million is in default. The service agreement provides 30 days for Spansion to continue the agreement with a payment of the amount in default to ChipMOS Taiwan.

ChipMOS Taiwan has also given Spansion notice that pursuant to Article 928 and Article 929 of the Taiwanese Civil Code it has obtained a statutory lien on the Spansion’s inventory and related equipment and materials currently in ChipMOS Taiwan’s possession. ChipMOS Taiwan reserves all of its rights and remedies available under the agreement and applicable law.