Samsung Electronics said on Wednesday that it has renewed its NAND flash memory chip licensing agreement with SanDisk (SNDK) for an another seven years.

Additionally, the two companies also forged a flash memory supply agreement, whereby Samsung will continue to earmark a guaranteed portion of its flash memory production output to SanDisk, said the companies.

“Although some information cannot be disclosed due to an agreement between the two parties, the royalty rate will be about half the rate applied in the existing contract,” Samsung said in a filing to the Korea Exchange.

Commenting on the collaboration, SanDisk chairman and CEO Eli Harari said, “We are very pleased with the agreements announced today. Furthermore, continued access to Samsung''s flash capacity under competitive terms gives us greater flexibility in managing our future capital expenditures.”

The fresh agreements will be effective after the existing cross license and supply agreements expires, i.e. on August 14 this year.

Samsung, leading maker of NAND flash memory chips, shells out about $350 million a year in royalties to SanDisk for its patented technology.