AMD 2014 Annual Report Download - page 48

$500 million in aggregate principal amount of 8.125% Senior Notes due 2017 (8.125% Notes). We also
repurchased $50 million in aggregate principal amount of our 7.75% Senior Notes due 2020 (7.75% Notes) in
open market transactions, and $25 million in aggregate principal amount of our 7.50% Senior Notes due 2022
(7.50% Notes). The repurchases of the 7.75% Notes and 7.50% Notes were funded with our Secured Revolving
Line of Credit. To assist us in financing these note repurchases, during 2014, we issued $500 million of 7.00%
Senior Notes due 2024 (7.00% Notes) and $600 million of 6.75% Senior Notes due 2019 (6.75% Notes). Total
debt as of the end December 27, 2014 was $2.2 billion compared to $2.1 billion as of December 28, 2013. Our
cash, cash equivalents and marketable securities as of December 27, 2014 were $1.0 billion compared to
$1.2 billion as of December 28, 2013.
GLOBALFOUNDRIES
Formation and Accounting
On March 2, 2009, we consummated the transactions contemplated by the Master Transaction Agreement
among us, Advanced Technology Investment Company LLC (currently known as Mubadala Technology
Investments LLC (Mubadala Tech)) and West Coast Hitech L.P. (WCH), pursuant to which we formed GF. In
connection with the consummation of the transactions contemplated by the Master Transaction Agreement,
AMD, Mubadala Tech and GF entered into a Wafer Supply Agreement (the WSA), a Funding Agreement (the
Funding Agreement) and a Shareholders’ Agreement (the Shareholders’ Agreement) on March 2, 2009.
At GF’s formation on March 2, 2009 and through December 26, 2009, GF was deemed a variable-interest
entity, and we were deemed to be GF’s primary beneficiary. Accordingly, we consolidated GF under applicable
accounting rules. As a result of certain GF governance changes, we deconsolidated GF and accounted for our GF
ownership under the equity method of accounting as of December 27, 2009. Following the deconsolidation, GF
became our related party.
In the first quarter of 2011, as a result of a contribution to GF by an affiliate of Mubadala Tech and certain
GF governance changes noted above, our ownership in GF was diluted, and we concluded that we no longer had
the ability to exercise significant influence over GF. Accordingly, we changed our accounting for our investment
in GF from the equity method to the cost method of accounting and recognized a dilution gain in investee of
approximately $492 million. In the fourth quarter of 2011, we identified indicators of impairment in GF that were
deemed other than temporary. We performed a valuation analysis and recorded a non-cash impairment charge of
$209 million. The carrying value of our remaining investment in GF after the impairment charge was $278
million as of December 31, 2011.
On March 4, 2012, as partial consideration for certain rights received under a second amendment to the
WSA, we transferred to GF all of the remaining capital stock of GF that we owned. In addition, as of March 4,
2012, the Funding Agreement was terminated, and we were no longer party to the Shareholders’ Agreement. As
a result of these transactions, we no longer owned any GF capital stock as of March 4, 2012.
GF continues to be a related party of us because Mubadala Development Company PJSC (Mubadala) and
Mubadala Tech are affiliated with WCH, our largest stockholder. WCH and Mubadala Tech are wholly-owned
subsidiaries of Mubadala.
Wafer Supply Agreement
The WSA governs the terms by which we purchase products manufactured by GF. Pursuant to the WSA, we
are required to purchase all of our microprocessor and APU product requirements from GF with limited
exceptions. If we acquire a third-party business that manufactures microprocessor and APU products, we will
have up to two years to transition the manufacture of such microprocessor and APU products to GF.
42