AMD 2011 Annual Report Download - page 47

• Cash paid by ATIC to GF for 218,190 Class A Preferred Shares: $218 million;
• Cash paid by ATIC to GF for 172,760 Class B Preferred Shares: $173 million; and
• Cash paid by ATIC to AMD for 700,000 Class B Preferred Shares: $700 million.
At the Closing, AMD and ATIC owned 1,090,950, or 83%, and 218,190, or 17%, respectively, of Class A
Preferred Shares, and ATIC owned 100% of the Class B Preferred Shares and 100% of the Class A Notes and
Class B Notes.
In November 2009, upon the settlement of our litigation with Intel Corporation and the execution of a patent
cross license agreement between us and Intel, the requirements satisfying the Reconciliation Event were met. As
a result, GF’s Class A and Class B Preferred Shares vote on an as converted basis with any outstanding GF
Ordinary Shares.
Class B Preferred Shares. GF’s Class B Preferred Shares rank senior in right of payment to all other
classes or series of equity securities of GF for purposes of dividends, distributions and upon a liquidation,
dissolution or winding up of GF (Liquidation Event). Each Class B Preferred Share is deemed to accrete in value
at a rate of 12% per year, compounded semiannually, of the initial purchase price per such share. The accreted
value accrues daily from the Closing and is taken into account upon certain distributions to the holders of Class B
Preferred Shares or upon conversion of the Class B Preferred Shares. Upon a Liquidation Event, each Class B
Preferred Share will be entitled to receive, prior to any distribution to the holders of any other classes or series of
equity securities, an amount equal to its accreted value. Each Class B Preferred Share is convertible, at the option
of the holder thereof, into Class B Ordinary Shares at the then applicable Class B Conversion Rate. Each Class B
Preferred Share will also automatically convert into Class B Ordinary Shares at the then applicable Class B
Conversion Rate upon the earlier of (i) an initial public offering of GF (IPO) or (ii) a change of control
transaction of GF. The initial Class B Conversion Rate is 100 Class B Ordinary Shares for each Class B Preferred
Share converted, subject to customary anti-dilution adjustments. The Class B Preferred Shares currently vote on
an as-converted basis with any outstanding Ordinary Shares, voting together as a single class, with respect to any
question upon which holders of Ordinary Shares have the right to vote.
Class A Preferred Shares. GF’s Class A Preferred Shares rank senior in right of payment to the Ordinary
Shares of GF and junior in right of payment to the Class B Preferred Shares for purposes of dividends,
distributions and upon a Liquidation Event. The Class A Preferred Shares are not entitled to any dividend or
pre-determined accretion in value. Upon a Liquidation Event, each Class A Preferred Share will be entitled to
receive, after the distribution to the holders of the Class B Preferred Shares but prior to any distribution to the
holders of Ordinary Shares, out of any remaining assets of GF, an amount equal to the initial purchase price per
share of the Class A Preferred Shares. Each Class A Preferred Share is convertible, at the option of the holder,
into Class B Ordinary Shares at the then applicable Class A Conversion Rate. Each Class A Preferred Share will
also automatically convert into Class B Ordinary Shares at the then applicable Class A Conversion Rate upon the
earlier of (i) an IPO or (ii) a change of control transaction of GF. The initial Class A Conversion Rate is 100
Class B Ordinary Shares for each Class A Preferred Share, subject to customary anti-dilution adjustments. The
Class A Preferred Shares currently vote on an as-converted basis with any outstanding Ordinary Shares, voting
together as a single class, with respect to any question upon which holders of Ordinary Shares have the right to
vote.
Class A Subordinated Convertible Notes. GF’s Class A Notes accrue interest at a rate of 4% per annum,
compounded semiannually. Interest on the Class A Notes is payable semiannually in additional Class A Notes.
The Class A Notes are the unsecured obligations of GF and rank subordinated in right of payment to any current
or future senior indebtedness of GF. The Class A Notes are not redeemable by GF without the note holder’s
consent. The Class A Notes are convertible, in whole or in part, in multiples of $1,000, into GF Class A Preferred
Shares at the option of the holder at any time prior to the close of business on the business day immediately
preceding the maturity date based on the conversion ratio in effect on the date of conversion. The Class A Notes
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