Crucial 2012 Annual Report Download - page 5

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Partnering Arrangements
The following is a summary of our partnering arrangements as of August 30, 2012:
Member or Partner(s) Approximate Micron
Ownership Interest Formed/ Acquired Product Market
Consolidated Entities
IMFT (1) Intel Corporation 51% 2006 NAND Flash
MP Mask (2) Photronics, Inc. 50% 2006 Photomasks
Equity Method Investments
Inotera (3) Nanya Technology Corporation 40% 2009 DRAM
Aptina (4) Riverwood Capital LLC and
TPG Partners VI, L.P. 35% 2009 CMOS Image Sensors
(1) IMFT: We partner with Intel for the design, development and manufacture of NAND Flash and certain emerging
memory products. In connection therewith, we formed a joint venture with Intel, IM Flash Technologies, LLC
("IMFT"), to manufacture NAND Flash memory products for the exclusive benefit of the members. The members
share the output of IMFT generally in proportion to their investment. We sell NAND Flash products to Intel through
IMFT at long-term negotiated prices approximating cost. We generally share product design and other research and
development costs for NAND Flash and certain emerging memory technologies equally with Intel. In April 2012, we
acquired Intel's remaining interests in a separate NAND Flash joint venture, IM Flash Singapore, LLP ("IMFS"). (See
"Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Consolidated
Variable Interest Entities – IM Flash" note.)
(2) MP Mask: We produce photomasks for leading-edge and advanced next generation semiconductors through MP Mask
Technology Center, LLC ("MP Mask"), a joint venture with Photronics, Inc. ("Photronics"). We and Photronics also
have supply arrangements wherein we purchase a substantial majority of the reticles produced by MP Mask. (See
"Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Consolidated
Variable Interest Entities – MP Mask" note.)
(3) Inotera: We partner with Nanya Technology Corporation ("Nanya") for the design, development and manufacture of
DRAM products, including the joint development of DRAM process technology. In connection therewith, we have
partnered with Nanya in a DRAM memory company in Taiwan, Inotera Memories, Inc. ("Inotera"). We have a supply
agreement with Inotera and Nanya which gives us the right and obligation to purchase 50% of Inotera's semiconductor
memory capacity subject to specific terms and conditions. Under the formula for this supply agreement, all parties'
manufacturing costs related to wafers supplied by Inotera, as well as our and Nanya's revenue for the resale of
products from wafers supplied by Inotera, are considered in determining costs for wafers purchased by us from
Inotera. In connection with the partnering agreement, we have also deployed and licensed certain intellectual property
related to the manufacture of DRAM products to Nanya and licensed certain intellectual property from Nanya. We
also partner with Nanya to jointly develop process technology and designs to manufacture DRAM products. Under a
cost-sharing arrangement effective beginning in April 2010, we generally share DRAM development costs with
Nanya. In addition, in 2010 we began receiving royalties from Nanya for sales of DRAM products manufactured by
or for Nanya with technology developed prior to April 2010. (See "Item 8. Financial Statements and Supplementary
Data – Notes to Consolidated Financial Statements – Equity Method Investments – Inotera" note.)
(4) Aptina: We manufacture CMOS image sensor products for Aptina under a wafer supply agreement. We own 64% of
Aptina’s common stock and none of their preferred stock resulting in a total ownership interest in Aptina of 35%. (See
"Item 8. Financial Statements and Supplementary Data – Notes to Consolidated Financial Statements – Equity Method
Investments – Other" note.)