South Korea's No. 2 chipmaker SK hynix Inc. said Friday it has agreed to settle a lawsuit with Japanese tech firm Toshiba Corp. and cooperate in developing new technologies.

"The lawsuit between the two will be dropped as we agreed to pay Toshiba $278 million as a settlement," SK hynix said in its regulatory filing. The chipmaker did not reveal further details, citing the terms of the agreement between the two companies.

Toshiba had sued the South Korean company in March through the Tokyo District Court over the alleged theft of its NAND flash memory chip technology and demanded 109.1 billion yen ($917.3 million) in compensation.

NAND flash memory chips are used in smartphones, tablet PCs and other mobile devices to save data when the devices are turned off.

SK hynix said the two companies agreed to jointly study nano imprint lithography (NIL) technology and work together for full-fledged cooperation.

"SK Hynix and Toshiba expect that this collaboration will enable the two parties to successfully develop the NIL by minimizing risk and moving up commercialization of this technology," the company said.

"Also, once it is successfully commercialized, it is expected to make a significant contribution to the acceleration of cost competitiveness," it added.

The two also agreed to extend their patent cross-licensing and product supply agreements clinched in 2007.

Shares of SK hynix closed at 48,500 won ($44.14) on the main bourse Friday, up 1.68 percent from the previous trading session.

The benchmark KOSPI was up 1.71 percent. The regulatory filing was released after the market closed. (Yonhap)