Apple (AAPL)

5.1           Cancellation.  Designees may cancel accepted Purchase Orders for Products for their convenience at any time, provided they pay IBM or its Plant applicable cancellation charges as set forth in this Section 5.1.

5.1.1        Exhibit 4 Products.  Designees may cancel Purchase Orders for Exhibit 4 Products (and any other ASIC Product that the parties may agree to treat in a similar manner) without charge, provided they give IBM written notice [**] prior to the original Scheduled Shipment Date.  If the Designee provides IBM written notice canceling a Purchase Order for such Products [**] prior to the original Scheduled Shipment Date, the Designee will pay IBM [**] of the purchase price of the Products ordered.  Promptly after receiving notice canceling a Purchase Order for Exhibit 4 Products, IBM will provide Apple and the Designee who placed the Purchase Order written notice of any applicable cancellation charges.  The Designee will promptly after receiving IBM’s notice, issue a Purchase Order to IBM for such charges, and IBM will invoice the same upon receipt.

                                                5.1.2        Other Products.  If the Designee provides IBM written notice canceling a Purchase Order for any other Product, the Designee shall pay the cancellation charges set forth in the applicable Attachment to the Agreement.  IBM will provide Apple and the Designee prompt written notice of any applicable cancellation charges.  The Designee canceling the Purchaser Order will, upon receipt of IBM’s written notice, promptly issue a Purchase Order to IBM for such charges and IBM will invoice the same upon receipt.

5.2           If a Designee cancels a Purchase Order for Services for its convenience, IBM will cease further work in connection with the Purchase Order and the Designee will pay IBM for reasonable costs actually incurred by IBM pursuant to such Purchase Order before the Designee’s notice of cancellation.  IBM must make its claim for cancellation charges and provide supporting documentation within forty-five (45) days of the date of cancellation.  Any claim not made within such forty-five (45) day period will be deemed waived.  In the event IBM is more than twenty-one (21) days late in completing a Purchase Order for Services, the Designee may cancel such Purchase Order and the Designee’s sole obligation will be to pay IBM for any deliverables ordered pursuant to that Purchase Order that were actually completed or delivered by IBM before the Designee’s notice of cancellation, provided that any periods of such delay that were caused by the Designee shall be excluded for purposes of calculating the length of the delay hereunder.

5.3           Rescheduling.  The Designee may reschedule accepted Purchase Orders for Products in accordance with this Section 5.3.

[**] = information redacted pursuant to a confidential treatment request.  Such omitted information has been filed

separately with the Securities and Exchange Commission.

5.3.1        Exhibit 4 Products.  The Designee may reschedule a Scheduled Shipment Date for an Exhibit 4 Product or any other ASIC Product that the parties may agree to treat in a similar manner to a later date provided:  (i) it sends IBM or its Plant written notice of the request to reschedule; (ii) the Product being rescheduled has not yet been shipped; and (iii) the requested rescheduled shipment date is within ninety (90) days after the original Scheduled Shipment Date.  If the foregoing requirements are met, no cancellation or other charge will be imposed by IBM or its Plant for rescheduling.

5.3.2        Other Products.  The Designee may reschedule an order for any other Product to a later date only upon prior written notice to IBM and as set forth in the applicable Attachment to the Agreement.  In the event of a reschedule which exceeds the rescheduling rights set forth in the applicable Attachment, IBM may invoice the Designee the quoted price for any Products that were delivered or ready for shipment pursuant to that Purchase Order on the date the Designee’s notice was received by IBM or its Plant, and the cancellation charges set forth in the applicable Attachment for any Products on that Purchase Order that were not already delivered or ready for shipment when IBM or its Plant received such notice.

5.4           Product Remix without Charge.  Designees may request that IBM or its Plant ship a different mix of Products than those originally ordered.  IBM or its Plant will agree to do so without charge provided:  (i) the Designee gives written notice to IBM or its Plant, as the case may be, at least [**] before the Scheduled Shipment Date;  (ii) all substituted Products are within the same Product-family as those originally ordered.  Products that utilize the same design revision, materials and manufacturing process from wafer start to module final test are within the same Product-family; (iii) the total number of units ordered remains the same; (iv) the change will not have any significant negative manufacturing or financial impact to IBM or its Plant in IBM or its Plant’s sole and reasonable judgment; and (v) subject to availability of Products that permit the requested remixing.  Changes that do not meet the requirements of this Section may be accepted for similar treatment in IBM’s or its Plant’s sole discretion.  If IBM or its Plant agrees to change an order as described in this Section, as a condition of obtaining such agreement, the Designee will promptly cancel the original Purchase Order without incurring any cancellation or other charge and place a new one for the modified Product mix.

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5.1           Cancellation.  Designees may cancel accepted Purchase
Orders for Products for their convenience at any time, provided they pay IBM or
its Plant applicable cancellation charges as set forth in this Section 5.1.

5.1.1        Exhibit 4 Products.  Designees may cancel Purchase Orders for
Exhibit 4 Products (and any other ASIC Product that the parties may agree to
treat in a similar manner) without charge, provided they give IBM written notice
[**] prior to the original Scheduled Shipment Date.  If the Designee provides IBM written notice canceling a Purchase
Order for such Products [**] prior to the original Scheduled Shipment Date, the
Designee will pay IBM [**] of the purchase price of the Products ordered.  Promptly after receiving notice canceling a
Purchase Order for Exhibit 4 Products, IBM will provide Apple and the Designee
who placed the Purchase Order written notice of any applicable cancellation
charges.  The Designee will promptly
after receiving IBM’s notice, issue a Purchase Order to IBM for such charges,
and IBM will invoice the same upon receipt.

                                                5.1.2        Other Products.  If the Designee provides IBM written notice
canceling a Purchase Order for any other Product, the Designee shall pay the
cancellation charges set forth in the applicable Attachment to the
Agreement.  IBM will provide Apple and
the Designee prompt written notice of any applicable cancellation charges.  The Designee canceling the Purchaser Order
will, upon receipt of IBM’s written notice, promptly issue a Purchase Order to
IBM for such charges and IBM will invoice the same upon receipt.

5.2           If a Designee cancels a Purchase
Order for Services for its convenience, IBM will cease further work in
connection with the Purchase Order and the Designee will pay IBM for reasonable
costs actually incurred by IBM pursuant to such Purchase Order before the
Designee’s notice of cancellation.  IBM
must make its claim for cancellation charges and provide supporting
documentation within forty-five (45) days of the date of cancellation.  Any claim not made within such forty-five
(45) day period will be deemed waived. 
In the event IBM is more than twenty-one (21) days late in completing a
Purchase Order for Services, the Designee may cancel such Purchase Order and
the Designee’s sole obligation will be to pay IBM for any deliverables ordered
pursuant to that Purchase Order that were actually completed or delivered by
IBM before the Designee’s notice of cancellation, provided that any periods of
such delay that were caused by the Designee shall be excluded for purposes of
calculating the length of the delay hereunder.

5.3           Rescheduling.  The Designee may reschedule accepted
Purchase Orders for Products in accordance with this Section 5.3.

[**] = information redacted pursuant to a confidential
treatment request.  Such omitted
information has been filed

separately with the Securities and Exchange
Commission.

5.3.1        Exhibit 4 Products.  The Designee may reschedule a Scheduled
Shipment Date for an Exhibit 4 Product or
any other ASIC Product that the parties may agree to treat in a similar manner
to a later date provided:  (i) it sends
IBM or its Plant written notice of the request to reschedule; (ii) the Product
being rescheduled has not yet been shipped; and (iii) the requested rescheduled
shipment date is within ninety (90) days after the original Scheduled Shipment
Date.  If the foregoing requirements are
met, no cancellation or other charge will be imposed by IBM or its Plant for
rescheduling.

5.3.2        Other Products.  The Designee may reschedule an order for any other
Product to a later date only upon prior written notice to IBM and as set forth
in the applicable Attachment to the Agreement. 
In the event of a reschedule which exceeds the rescheduling rights set
forth in the applicable Attachment, IBM may invoice the Designee the quoted
price for any Products that were delivered or ready for shipment pursuant to
that Purchase Order on the date the Designee’s notice was received by IBM or
its Plant, and the cancellation charges set forth in the applicable Attachment
for any Products on that Purchase Order that were not already delivered or
ready for shipment when IBM or its Plant received such notice.

5.4           Product Remix without Charge.  Designees may request that IBM or its Plant
ship a different mix of Products than those originally ordered.  IBM or its Plant will agree to do so without
charge provided:  (i) the Designee gives
written notice to IBM or its Plant, as the case may be, at least [**] before
the Scheduled Shipment Date;  (ii) all
substituted Products are within the same Product-family as those originally
ordered.  Products that utilize the same
design revision, materials and manufacturing process from wafer start to module
final test are within the same Product-family; (iii) the total number of units
ordered remains the same; (iv) the change will not have any significant
negative manufacturing or financial impact to IBM or its Plant in IBM or its
Plant’s sole and reasonable judgment; and (v) subject to availability of
Products that permit the requested remixing. 
Changes that do not meet the requirements of this Section may be
accepted for similar treatment in IBM’s or its Plant’s sole discretion.  If IBM or its Plant agrees to change an
order as described in this Section, as a condition of obtaining such agreement,
the Designee will promptly cancel the original Purchase Order without incurring
any cancellation or other charge and place a new one for the modified Product
mix.

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