Intel 2010 Annual Report Download - page 65

Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS (Continued)
Contractual obligations that are contingent upon the achievement of certain milestones are not included in the preceding table.
These obligations include contingent funding/payment obligations and milestone-based equity investment funding. These
arrangements are not considered contractual obligations until the milestone is met by the third party. Assuming that all future
milestones are met, additional required payments related to these obligations were not significant as of December 25, 2010.
For the majority of restricted stock units granted, the number of shares issued on the date the restricted stock units vest is net
of the minimum statutory withholding requirements that we pay in cash to the appropriate taxing authorities on behalf of our
employees. The obligation to pay the relative taxing authority is not included in the preceding table, as the amount is
contingent upon continued employment. In addition, the amount of the obligation is unknown, as it is based in part on the
market price of our common stock when the awards vest.
We have a contractual obligation to purchase the output of IMFT in proportion to our investment, which was 49% as of
December 25, 2010. We also have several agreements with Micron related to intellectual property rights, and R&D funding
related to NAND flash manufacturing. The obligation to purchase our proportion of IMFT’s inventory was approximately
$100 million as of December 25, 2010. See “Note 11: Equity Method and Cost Method Investments” in Part II, Item 8 of this
Form 10-K.
In January 2011, we entered into a patent cross-license agreement with NVIDIA. We agreed to make payments totaling $1.5
billion to NVIDIA over six years ($300 million in each of January 2011, 2012, and 2013; and $200 million in each of January
2014, 2015, and 2016). For further information, see “Note 29: Contingencies” in Part II, Item 8 of this Form 10-K.
During 2010, we entered into a definitive agreement to acquire all outstanding common shares of McAfee for $48.00 per share
in cash to be paid to the stockholders of McAfee. As of the date that we entered into the agreement, the transaction had an
approximate value of $7.68 billion. We expect to complete the acquisition in the first quarter of 2011. The transaction is
subject to customary closing conditions. For further information, see “Note 15: Acquisitions” in Part II, Item 8 of this Form
10-K.
During 2010, we entered into a definitive agreement to acquire the WLS business of Infineon. In the first quarter of 2011, we
completed the acquisition. Total net cash consideration for the acquisition is estimated at $1.4 billion. For further information,
see “Note 15: Acquisitions” in Part II, Item 8 of this Form 10-K.
The expected timing of payments of the obligations above is estimated based on current information. Timing of payments and
actual amounts paid may be different, depending on the time of receipt of goods or services, or changes to
agreed-upon amounts for some obligations.
Off-Balance-Sheet Arrangements
As of December 25, 2010, we did not have any significant off-balance-sheet arrangements, as defined in Item 303(a)(4)(ii) of
SEC Regulation S-K.
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