AMD 1998 Annual Report Download - page 248

on the grant date. The weighted-average exercise price and weighted-average fair
value of these awards were $20.44 and $3.51, respectively. We granted a total of
150,990 stock-based awards during 1998 with exercise prices less than the market
price of the stock on the grant date. The weighted-average exercise price and
weighted-average fair value of these awards were $3.36 and $17.88, respectively.
We granted a total of 3,172,820 stock-based awards during 1997 with exercise
prices equal to the market price of the stock on the grant date. The weighted-
average exercise price and weighted-average fair value of these awards were
$36.11 and $16.07, respectively. We granted a total of 234,285 stock-based
awards during 1997 with exercise prices less than the market price of the stock
on the grant date. The weighted-average exercise price and weighted-average fair
value of these awards were $8.09 and $23.82, respectively. We granted a total of
10,332,224 options during 1996 with exercise prices equal to the market price of
the stock on the grant date. The weighted-average exercise price and weighted-
average fair value of these options were $13.44 and $5.15, respectively. We
granted a total of 912,994 options during 1996 with exercise prices less than
the market price of the stock on the grant date. The weighted-average exercise
price and weighted-average fair value of these options were $7.49 and $12.14,
respectively.
The weighted-average fair value of stock purchase rights during 1998, 1997 and
1996 was $6.21 per share, $8.42 per share and $4.07 per share, respectively.
Note 11. Other Employee Benefit Plans
Profit Sharing Program We have a profit sharing program to which the Board of
Directors has authorized semiannual contributions. Profit sharing contributions
were approximately $5 million in 1998 and $4 million in 1997. There were no
profit sharing contributions in 1996.
Retirement Savings Plan We have a retirement savings plan, commonly known as a
401(k) plan, that allows participating United States employees to contribute
from 1 percent to 15 percent of their pretax salary subject to I.R.S. limits. We
make a matching contribution calculated at 50 cents on each dollar of the first
3 percent of participant contributions, to a maximum of 1.5 percent of eligible
compensation. Our contributions to the 401(k) plan were approximately $5 million
for each of the years 1998, 1997 and 1996.
Note 12. Commitments
We lease certain of our facilities under agreements which expire at various
dates through 2018. We also lease certain of our manufacturing and office
equipment for terms ranging from one to five years. Rent expense was
approximately $54 million, $48 million and $40 million in 1998, 1997 and 1996,
respectively.
For each of the next five years and beyond, noncancelable long-term operating
lease obligations and commitments to purchase manufacturing supplies and
services are as follows:
Operating Purchase
(Thousands) leases commitments
- ----------------------------------------
1999 $ 45,409 $ 38,251
2000 39,788 32,601
2001 30,005 7,660
2002 26,096 5,059
2003 25,308 5,059
Beyond 2003 230,933 19,934
---------------------
$397,539 $ 108,564
=====================
The operating lease of our corporate marketing, general and administrative
facility expired in December 1998. At the end of the lease term, we were
obligated to either purchase the facility or to arrange for its sale to a third
party with a guarantee of residual value to the seller equal to the option
purchase price. In December 1998, we arranged for the sale of the facility to a
third party and leased it back under a new operating lease. We realized a gain
of $34 million as a part of this transaction. We have deferred the gain and will
amortize it over a
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Source: ADVANCED MICRO DEVIC, 10-K, March 29, 1999