AMD 2000 Annual Report Download - page 335

of that Month exceeds the amount of the inventory at the end of
the immediately preceding Month, nor (b) increased for that Month
by the amount by which the inventory at the end of that Month is
less than the amount of the inventory at the end of the
immediately preceding Month.
With reference to clause (a) of this definition above,
(i) Start-up Costs will not be capitalized;
(ii) depreciation of fixed assets will be applied on a straight-
line basis on the assumption of useful lives of 25 years
for buildings (shell), ten years for other non-movables
(i.e., installations (Betriebsvorrichtungen) including,
without limitation, the "clean room") and five years for
movables (machinery, tools and other equipment) (these
depreciation schedules may be adjusted due to changes in
the official depreciation schedules);
(iii) exceptional depreciation in order to state fixed assets at
a lower value, and reversals of such depreciation in the
case that the reasons for an exceptional depreciation no
longer exist, will be included;
(iv) revenues from investment grants (Investitionszuschuesse)
and allowances (Investitionszulagen) will be allocated
chronologically to the investments in buildings, machinery,
tools and other equipment to which they relate for the AMD
Saxonia Fiscal Years 1996 to 2005. They will be amortized
parallel to the depreciation of the corresponding fixed
assets and so will reduce these depreciation costs;
(v) Without limiting the generality of clause (a) of this
definition, such amortization shall occur regardless of
whether AMD Saxonia elects to treat some or all of such
grants and allowances as income in the year received for
purposes of AMD Saxonia's statutory financial statements;
(vi) All grants, allowances, interest subsidies, or expense
reimbursements described in clause (f) of this definition
but which are not investment grants
(Investitionszuschuesse) or allowances
(Investitionszulagen) will reduce Total Costs in the Month
received by the full amount received in that Month;
(vii) write-downs on current assets due to obsoleteness or
solvency reasons will be included;
(viii) inventory will be valued at the lower valuation limit
according to German Income Tax Regulation (R 33
9
Source: ADVANCED MICRO DEVIC, 10-K405, March 20, 2001