AMD 2002 Annual Report Download

Download and view the complete annual report

Please find the complete 2002 AMD annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 295

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184
  • 185
  • 186
  • 187
  • 188
  • 189
  • 190
  • 191
  • 192
  • 193
  • 194
  • 195
  • 196
  • 197
  • 198
  • 199
  • 200
  • 201
  • 202
  • 203
  • 204
  • 205
  • 206
  • 207
  • 208
  • 209
  • 210
  • 211
  • 212
  • 213
  • 214
  • 215
  • 216
  • 217
  • 218
  • 219
  • 220
  • 221
  • 222
  • 223
  • 224
  • 225
  • 226
  • 227
  • 228
  • 229
  • 230
  • 231
  • 232
  • 233
  • 234
  • 235
  • 236
  • 237
  • 238
  • 239
  • 240
  • 241
  • 242
  • 243
  • 244
  • 245
  • 246
  • 247
  • 248
  • 249
  • 250
  • 251
  • 252
  • 253
  • 254
  • 255
  • 256
  • 257
  • 258
  • 259
  • 260
  • 261
  • 262
  • 263
  • 264
  • 265
  • 266
  • 267
  • 268
  • 269
  • 270
  • 271
  • 272
  • 273
  • 274
  • 275
  • 276
  • 277
  • 278
  • 279
  • 280
  • 281
  • 282
  • 283
  • 284
  • 285
  • 286
  • 287
  • 288
  • 289
  • 290
  • 291
  • 292
  • 293
  • 294
  • 295

FORM 10-K
ADVANCED MICRO DEVICES INC - amd
Filed: March 14, 2003 (period: December 29, 2002)
Annual report which provides a comprehensive overview of the company for the past year

Table of contents

  • Page 1
    FORM 10-K ADVANCED MICRO DEVICES INC - amd Filed: March 14, 2003 (period: December 29, 2002) Annual report which provides a comprehensive overview of the company for the past year

  • Page 2
    ... AND SUPPLEMENTARY DATA CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE PART III ITEM 10. ITEM 11. ITEM 12. ITEM 13. ITEM 14. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT EXECUTIVE COMPENSATION SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT...

  • Page 3
    EX-10.43(A-5) (AM. AGREEMENT NO. 5 TO SYNDICATED LOAN) EX-10.43(F-6) (FIFTH AM. TO SPONSOR'S SUPPORT AGREEMENT) EX-10.43(I-1) (SECOND AMENDMENT TO SPONSORS' GUARANTY) EX-10.54 ("S" PROCESS DEVELOPMENT AGREEMENT) EX-21 (LIST OF AMD SUBSIDIARIES) EX-24 (POWER OF ATTORNEY)

  • Page 4
    ... 94086 One AMD Place, Sunnyvale, California (Address of principal executive offices) (Zip Code) (Registrant's telephone number, including area code) (408) 732-2400 Securities registered pursuant to Section 12(b) of the Act: (Title of each class) (Name of each exchange on which registered) $.01...

  • Page 5
    Table of Contents Advanced Micro Devices, Inc. FORM 10-K For The Fiscal Year Ended December 29, 2002 INDEX PART I ITEM 1. ITEM 2. ITEM 3. ITEM 4. PART II ITEM 5. ITEM 6. ITEM 7. ITEM 7A. ITEM 8. ITEM 9. PART III ITEM 10. ITEM 11. ITEM 12. ITEM 13. ITEM 14. PART IV ITEM 15. EXHIBITS, FINANCIAL ...

  • Page 6
    .... Our products consist of microprocessors, Flash memory devices and personal connectivity solutions. We were incorporated under the laws of Delaware on May 1, 1969. Our mailing address and executive offices are located at One AMD Place, Sunnyvale, California 94086, and our telephone number is...

  • Page 7
    ... clock speed, the rate at which its internal logic operates, which is measured in units of hertz, or cycles processed per second. Other factors in microprocessor performance include memory storage and access speed. Developments in circuit design and manufacturing process technologies have resulted...

  • Page 8
    ... a very limited number of EPROM devices as sales of EPROM devices have been steadily declining for the past few years as customers switch over to Flash memory devices. Several factors have contributed to an increasing demand for memory devices in recent years, including the: • increasing use and...

  • Page 9
    ... numbers to position our products against comparable Intel products designated only by their clock speed. We currently offer products for the desktop PC, mobile computing, server and workstation markets. Our x86 microprocessors for the desktop PC market consist of the AMD Athlon XP processor and...

  • Page 10
    ...recent years, many of these third-party designers and manufacturers have lost significant market share to Intel or exited the business. In addition, these companies produce chipsets, motherboards, BIOS software and other components to support each new generation of Intel's microprocessors, and Intel...

  • Page 11
    ... in Japan by Fujitsu AMD Semiconductor Limited (FASL), our joint venture with Fujitsu Limited, with additional devices produced under FASL's foundry arrangements with us. We manufacture Flash memory devices for FASL in our fabrication facility in Austin, Texas, Fab 25. Other ICs Embedded Processors...

  • Page 12
    ...-volatile memory technology used for manufacturing our Flash memory products. During 2002, we converted our microprocessor manufacturing from 180 nanometer process technology to 130 nanometer process technology. As of year-end 2002, all of our microprocessors were 7 Source: ADVANCED MICRO DEVIC, 10...

  • Page 13
    ... Contents manufactured using our 130 nanometer process technology. Our manufacturing facility in Dresden, Germany (Fab 30) uses 130 nanometer manufacturing process to produce our most advanced microprocessors, including our AMD Athlon XP processor. Flash memory device production at year-end 2002 was...

  • Page 14
    ... used for manufacturing our Flash memory products will continue to be conducted at our SDC. Our current assembly and test facilities are described in the chart set forth below: Approximate Assembly & Test Square Footage Facility Location Activity Penang, Malaysia Bangkok, Thailand Singapore...

  • Page 15
    ... we use in the manufacture of our products are available from a limited number of suppliers. For example, we are dependent on key chemicals from a limited number of suppliers and rely on a few foreign companies to supply the majority of certain types of the IC packages we purchase. Interruption...

  • Page 16
    ... land in Dresden, Germany for Fab 30. Fab 30 is encumbered by a lien securing borrowings of AMD Saxony. Fab 25 in Austin, Texas is encumbered by a lien securing our Term Loan and Security Agreement dated September 27, 2002. We lease 11 sales offices in North America, 12 sales offices in Asia Pacific...

  • Page 17
    ... will not have a material adverse effect on our business. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this report. 12 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 18
    ... of Contents PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS Our common stock (symbol "AMD") is listed on the New York Stock Exchange. On March 3, 2003, there were 8,064 registered holders of our common stock. We have never paid cash dividends on our stock and...

  • Page 19
    ... Years Ended December 29, 2002 (Thousands except per share amounts) 2002 2001 2000 1999 1998 Net Sales Expenses: Cost of sales Research and development Marketing...) (0.30) (0.30) 294,577 294,577 $ $ 1,167,973 5,767,735 $ $ 1,427,282 4,377,698 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 20
    ... to our operating results. Inventory Valuation. At each balance sheet date, we evaluate our ending inventories for excess quantities and obsolescence. This evaluation includes analyses of sales levels by product and projections of future demand. 15 Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 21
    ... tax planning strategies in determining the need for a valuation allowance. In fiscal 2002, we recorded a valuation allowance against all of our deferred tax assets, net of deferred tax liabilities, based on past performance and the likelihood of realization of our deferred tax assets at this time...

  • Page 22
    ... customer demand, reflecting our decision to limit shipments and accept receipt of product returns from certain customers. We expect PC processor sales in the first quarter of 2003 to increase as compared to the fourth quarter of 2002 based on sales of higher performance and higher priced products...

  • Page 23
    ..., rapid product development cycles and high fixed costs due to capital-intensive manufacturing processes, particularly the costs to build and maintain state-of-the-art production facilities required for PC processors and memory devices. As a result, our gross margin 18 Source: ADVANCED MICRO DEVIC...

  • Page 24
    ... products and the AMD Athlon XP processor launch, offset by the absence of Legerity expenses during 2001 as a result of its sale in 2000. In December 2002, we finalized a restructuring plan (the 2002 Plan) to align our cost structure to current industry conditions resulting from weak customer demand...

  • Page 25
    ...a resulting decline in revenues. In connection with the plan, we closed Fabs 14 and 15 in Austin, Texas. These facilities supported certain of our older products and our Foundry Service operations, which have been discontinued as part of the plan. We also reorganized related manufacturing facilities...

  • Page 26
    ... to date resulted in actual savings of $83 million in 2002. We sold 90 percent of Legerity to Francisco Partners, L.P. for approximately $375 million in cash, effective July 31, 2000. Prior to the sale, Legerity was a wholly owned subsidiary of AMD, selling voice communications products. Our pre-tax...

  • Page 27
    ..., Flash memory devices, EPROMs, embedded processors, platform products, personal connectivity solutions products and networking products. The Foundry Services segment included fees for products sold to Legerity and Vantis. Our previous Voice Communications segment included the voice communications...

  • Page 28
    ... million used for the purchases of property, plant, and equipment, primarily for Fab 30 and Asia manufacturing facilities, and $122 million for additional equity investments in FASL, offset by $246 million of net proceeds from sales and maturities of available-for-sale securities. Net cash used in...

  • Page 29
    ... 2007 Notes payable to banks Term Loan and Security Agreement dated as of September 27, 2002 4.75% Convertible Senior Debentures Due 2022 4.50% Convertible Senior Notes Due 2007 Dresden term loans Capital lease obligations Operating leases Unconditional purchase commitments Total contractual cash...

  • Page 30
    ... the last reported sale price of our common stock is at least 130 percent of the then effective conversion price for at least 20 trading days within a period of 30 consecutive trading days ending within five trading days of the date of the redemption notice. 25 Source: ADVANCED MICRO DEVIC, 10...

  • Page 31
    ... of banks are providing financing for the project. We currently estimate that the construction and facilitization costs of Fab 30 will be $2.6 billion when it is fully equipped by the end of 2005. As of December 29, 2002, we had invested $2.1 billion in AMD Saxony. 26 Source: ADVANCED MICRO DEVIC...

  • Page 32
    ... amended in August 2002, the Federal Republic of Germany and the State of Saxony are supporting the Fab 30 project, in accordance with the Dresden Loan Agreements, in the form of: • guarantees equal to the lesser of 65 percent of AMD Saxony bank debt or $799 million; • capital investment grants...

  • Page 33
    ... or otherwise comply with our obligations relating to the Dresden Loan Agreements; • the sale of shares in AMD Saxony or AMD Holding; • the failure to pay material obligations; • the occurrence of a material adverse change or filings or proceedings in bankruptcy or insolvency with respect to...

  • Page 34
    ...$160 million for periods through 2009. FASL Facilities and Guarantees FASL, a joint venture formed by AMD and Fujitsu Limited in 1993, operates advanced integrated circuit manufacturing facilities in Aizu-Wakamatsu, Japan, to produce Flash memory devices. FASL is continuing the facilitization of its...

  • Page 35
    ... & Co. KG (AMTC) and Maskhouse Building Administration GmbH & Co., KG (BAC) are joint ventures formed by us, Infineon Technologies AG and Dupont Photomasks, Inc. for the purpose of constructing and operating a new advanced photomask facility in Dresden, Germany. In June 2002, BAC entered into a $78...

  • Page 36
    ... beginning in the first quarter of fiscal 2003. The transition provisions of SFAS 148 are currently not applicable to us as we continue to account for stock-based compensation in accordance with Accounting Principles Board Opinion No. 25. 31 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 37
    ...for 2001. This decline was due primarily to reduced demand for our products resulting from the current economic slowdown and our decision primarily in the third and fourth quarters of 2002 to limit shipments and to accept receipt of product returns from certain customers, each as part of our efforts...

  • Page 38
    ...limit our ability to use our cash flow or obtain additional financing for future working capital, capital expenditures, acquisitions or other general corporate purposes; • require a substantial portion of our cash flow from operations to make debt service payments; 33 Source: ADVANCED MICRO DEVIC...

  • Page 39
    ... amounts on research and development than we do. In marketing our microprocessors to OEMs and dealers, we depend on third-party companies other than Intel for the design and manufacture of core-logic chipsets, graphics chips, motherboards, BIOS software and 34 Source: ADVANCED MICRO DEVIC, 10...

  • Page 40
    ...aggressive Intel pricing strategies, marketing programs, new product introductions and product bundlings of microprocessors, motherboards and chipsets; • our ability, on a timely basis, to produce microprocessors in the volume and with the performance and feature set required by customers; • the...

  • Page 41
    ... memory devices as the market develops and Intel and other competitors introduce new competing products. A decline in unit sales of our Flash memory devices, lower average selling prices, or a loss of a significant customer in the high-end mobile phone market, would have a material adverse effect...

  • Page 42
    ... used to fabricate our products or that we will have sufficient resources to invest in the level of research and development that is required to remain competitive. We make substantial investments in research and development of process technologies in an effort 37 Source: ADVANCED MICRO DEVIC...

  • Page 43
    ..., which could have a material adverse effect on us. Nearly all product assembly and final testing of our products are performed at our manufacturing facilities in Malaysia, Thailand, China and Singapore; or by subcontractors in the United States 38 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 44
    ...equipment manufacturers indirectly through distributors, as our forecasts for demand are then based on estimates provided by multiple parties. In addition, our customers may change their inventory practices on short notice for any reason. The cancellation or deferral of product orders, the return of...

  • Page 45
    ... price for our securities and on the future prices of our securities. Our corporate headquarters, assembly and research and development activities are located in an earthquake zone and these operations could be interrupted in the event of an earthquake. Our corporate 40 Source: ADVANCED MICRO DEVIC...

  • Page 46
    ... ensure the safety and preservation of our invested funds by limiting default risk and market risk. We use proceeds from debt obligations primarily to support general corporate purposes, including capital expenditures and working capital needs. 41 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 47
    ... financial position, results of operations or cash flows resulting from the use of these instruments in the future. However, we cannot give any assurance that these strategies will be effective or that transaction losses can be minimized or forecasted accurately. 42 Source: ADVANCED MICRO DEVIC, 10...

  • Page 48
    ... rates) $ 30,394 224,267 - 29,600 207,450 123.38 0.9344 - 125.00 0.9430 $ 872 24,328 - 1,326 20,064 $ 105,895 195,907 19,854 86,400 99,076 122.76 0.89 1.81 125.00 0.92 $ (4,066) 1,778 171 (1,375) 93 $ 491,711 43 $ 46,590 $ 507,132 $ (3,399) Source: ADVANCED MICRO DEVIC...

  • Page 49
    ... used in per share calculations: Basic Diluted See accompanying notes 44 (1,225,386) - 32,132 (71,349) (1,264,603) 44,586 (1,309,189) 6,177 (1,303,012) - $ (1,303,012) $ $ $ $ (3.81) (3.81) (3.81) (3.81) 342,334 342,334 983,026 3.25 2.95 3.18 2.89 309,331 350,000 Source: ADVANCED MICRO DEVIC...

  • Page 50
    ... of $18,906 in 2002 and $19,270 in 2001 Inventories: Raw materials Work-in-process Finished goods Total inventories Deferred income taxes Prepaid expenses and other current assets Total current assets Property, plant and equipment: Land Buildings and leasehold improvements Equipment Construction...

  • Page 51
    ...Net change in cumulative translation adjustments Total other comprehensive loss Total comprehensive income Issuance of shares: Employee stock plans Conversion of 6% Subordinated Notes Income tax benefits realized from employee stock option exercises Compensation recognized under employee stock plans...

  • Page 52
    46 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 53
    ... loss on disposal of property, plant and equipment Net loss (gain) realized on sale of available-for-sale securities Compensation recognized under employee stock plans Undistributed income of joint venture Recognition of deferred gain on sale of building Changes in operating assets and liabilities...

  • Page 54
    ... manufacturer with manufacturing facilities in the United States, Europe, China and Asia and sales offices throughout the world. The Company designs, manufactures and markets industry-standard digital integrated circuits, or ICs, that are used in many diverse product applications such as personal...

  • Page 55
    ... advertising and marketing promotions, volume based incentives and special pricing arrangements, at the time the related revenues are recognized. Shipping and handling costs associated with product sales are included in cost of sales. Impairment of Long-lived Assets. The Company accounts for the...

  • Page 56
    ... costs recorded at the same time the related revenue is recognized. All other advertising costs are expensed as incurred. Advertising expenses for 2002, 2001 and 2000 were approximately $199 million, $184 million and $148 million, respectively. 50 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 57
    ... on the Company's available-for-sale securities, deferred gains and losses on derivative financial instruments qualifying as cash flow hedges and foreign currency translation adjustments are included in accumulated other comprehensive income (loss). 51 Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 58
    ... to employees using a Black-Scholes option pricing model. See Note 10 for detailed assumptions used by the Company to compute the fair value of stock-based awards for purposes of pro forma disclosures under SFAS 123. 2002 2001 (Thousands except per share amounts) 2000 Net income/(loss)-as reported...

  • Page 59
    ... No. 123, "Accounting for Stock Based Compensation." In addition, SFAS 148 requires disclosure of the effects of an entity's accounting policy with respect to stock-based compensation on reported net income and earnings per share in annual and interim financial statements. The Company adopted the...

  • Page 60
    ... $375 million in cash to Francisco Partners, L.P., effective July 31, 2000. Prior to the sale, Legerity was a wholly owned subsidiary of AMD, selling voice communications products. The Company's pre-tax gain on the sale of Legerity was $337 million. The gain was computed based on the excess of the...

  • Page 61
    ... 5,000 $ 443,533 $ $ 11,571 11,571 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ 732,560 Long-term equity investments consist of marketable equity securities that, while available for sale, are not intended to be used to fund current operations. 55 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 62
    ... 603,229 216,496 36,587 1,493,840 1,530,427 107,551 $ 1,422,876 $ $ 1,568,707 437,902 $ 386,733 The fair value of the Company's accounts receivable and accounts payable approximate book value based on existing payment terms. 56 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 63
    ... up the Company's customer base, thus spreading the trade credit risk. The Company controls credit risk through credit approvals, credit limits and monitoring procedures. The Company performs in-depth credit evaluations of all new customers and requires letters of credit, bank guarantees and advance...

  • Page 64
    .... The Company also had federal and state tax credit carryforwards of approximately $92 million and $36 million, respectively. The net operating loss and tax credit carryforwards will expire at various dates beginning in 2005 through 2022, if not utilized. 58 Source: ADVANCED MICRO DEVIC, 10...

  • Page 65
    ... accrue additional taxes of approximately $107 million. NOTE 7: Debt On July 13, 1999, the Company entered into a Loan and Security Agreement (the July 1999 Loan Agreement) with a consortium of banks led by a domestic financial institution. Under the Loan Agreement, 59 Source: ADVANCED MICRO DEVIC...

  • Page 66
    ...ability to pay cash dividends if the level of net cash it holds declines below $200 million. The Company's obligations under the July 1999 Loan Agreement are secured by a pledge of all of its accounts receivable, inventory, general intangibles and the related proceeds. As of December 29, 2002, there...

  • Page 67
    ... to February 5, 2006 unless the last reported sale price of the Company's common stock is at least 130 percent of the then effective conversion price for at least 20 trading days within a period of 30 consecutive trading days ending within five trading days of the date of the redemption notice. The...

  • Page 68
    Table of Contents $155 million to be secured by certain property, plant and equipment located at the Company's Fab 25 semiconductor manufacturing facility in Austin, Texas. Amounts borrowed under the September 2002 Loan Agreement bear interest at a variable rate of LIBOR plus four percent, which was...

  • Page 69
    ... the effective date of its sale. The accounting policies of the segments are the same as those described in the Summary of Significant Accounting Policies. The Company evaluates performance and allocates resources based on these segments' operating income (loss). 63 Source: ADVANCED MICRO DEVIC, 10...

  • Page 70
    ... outside the United States include both manufacturing and sales activities. The Company's manufacturing subsidiaries are located in Germany, Malaysia, Thailand, Singapore and China. Its sales subsidiaries are in Europe, Asia Pacific and Brazil. 64 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 71
    .... Long-lived assets are those assets used in each geographic area. The Company markets and sells its products primarily to a broad base of customers comprised of distributors and OEMs of computation and communications equipment. No distributor accounted for ten percent or more of net sales in 2002...

  • Page 72
    ... only, the Company estimates the fair value of its stock-based awards to employees using a Black-Scholes option pricing model. The Black-Scholes model was developed for use in estimating fair value of traded options that have no vesting restrictions and are fully transferable. In addition, the Black...

  • Page 73
    ...-based awards during 2000 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 $4.92 and $31.25, respectively. NOTE 11: Other Employee Benefit Plans Profit Sharing Program. The Company...

  • Page 74
    ...$ The operating lease of the Company's corporate marketing, general and administrative facility in Sunnyvale expired in December 1998, at which time the Company arranged for the sale of the facility to a third party and leased it back under a new operating lease. The Company deferred the gain ($37...

  • Page 75
    ... 2002, (the Subsidy Agreement) the Federal Republic of Germany and the State of Saxony are supporting the Fab 30 project, in accordance with the Dresden Loan Agreements, in the form of: • guarantees equal to the lesser of 65 percent of AMD Saxony bank debt or $799 million; • capital investment...

  • Page 76
    ... from the approved plan and specifications; • the Company's failure to fund equity contributions or loans or otherwise comply with the Company's obligations relating to the Dresden Loan Agreements; • the sale of shares in AMD Saxony or AMD Holding; • the failure to pay material obligations...

  • Page 77
    ... Co. KG (AMTC), and Maskhouse Building Administration GmbH & Co., KG (BAC), are joint ventures formed by AMD, Infineon Technologies AG and Dupont Photomasks, Inc. for the purpose of constructing and operating a new advanced photomask facility in Dresden, Germany. In June 2002, BAC entered into a $78...

  • Page 78
    ... In 1993, the Company formed a joint venture (FASL) with Fujitsu Limited for the development and manufacture of non-volatile memory devices. FASL operates advanced IC manufacturing facilities in Aizu-Wakamatsu, Japan, to produce Flash memory devices, which are sold to the Company and Fujitsu. The...

  • Page 79
    ... the Company finalized a restructuring plan (the 2002 Plan) to align its cost structure to current industry conditions resulting from weak customer demand and industry wide excess inventory. The 2002 Plan will result in the reduction of approximately 2,000 positions or 15% of the Company's employees...

  • Page 80
    ... industry, and a resulting decline in revenues. In connection with the plan, the Company closed Fabs 14 and 15 in Austin, Texas. These facilities supported certain of the Company's older products and its Foundry Service operations, which have been discontinued as part of the plan. The Company...

  • Page 81
    ... designed, developed and marketed low-power, high-performance microprocessors for personal connectivity devices such as personal digital assistants (PDAs), web tablets and portable and wired Internet access devices and gateways. The Company accounted for the acquisition using the purchase method...

  • Page 82
    ... tanks at facilities in Santa Clara County, California, adversely affected the groundwater. The chemicals released into the groundwater were commonly used in the semiconductor industry in the wafer fabrication process prior to 1979. At least one of the released chemicals (which the Company no longer...

  • Page 83
    ..., the consolidated financial position of Advanced Micro Devices, Inc. as of December 29, 2002 and December 30, 2001, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 29, 2002, in conformity with accounting principles generally...

  • Page 84
    ...,782 341,782 340,806 340,806 340,119 340,119 345,044 345,044 330,120 340,533 314,347 351,785 ITEM 9. None. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 78 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 85
    ... controls and procedures were effective. Since the date we completed our evaluation to the date of this report, there have been no significant changes in our internal controls or in other factors that could significantly affect the internal controls. 79 Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 86
    ... incorporated by reference. Certificate of Amendment to Restated Certificate of Incorporation dated May 25, 2000, filed as Exhibit 3.3 to AMD's Quarterly Report on Form 10-Q for the period ended July 2, 2000, is hereby incorporated by reference. 80 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 87
    ... for the fiscal year ended December 31, 2000, is hereby incorporated by reference. AMD 2000 Stock Incentive Plan, filed as Exhibit 10.13 to AMD's Annual Report on Form 10-K for the fiscal year ended December 31, 2000, is hereby incorporated by reference. 81 Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 88
    .... Amendment to Joint Venture License Agreement, effective April 1, 1999, between AMD and Fujitsu Limited, filed as Exhibit 10.23(g-1) to AMD's Quarterly Report on Form 10-Q for the period ended July 1, 2001, is hereby incorporated by reference. 82 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 89
    ...hereby incorporated by reference. Form of indemnification agreements with officers and directors of AMD, filed as Exhibit 10.38 to AMD's Annual Report on Form 10-K for the fiscal year ended December 25, 1994, is hereby incorporated by reference. 83 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 90
    ... the Use of Land between AMD (Suzhou) Limited and China-Singapore Suzhou Industrial Park Development Co., Ltd., filed as Exhibit 10.39 to AMD's Annual Report on Form 10-K for the fiscal year ended December 31, 1995, is hereby incorporated by reference. NexGen, Inc. 1987 Employee Stock Plan, filed as...

  • Page 91
    ...' Loan Agreement, dated as of March 11, 1997, among AMD, AMD Saxony Holding GmbH and AMD Saxony Manufacturing GmbH, filed as Exhibit 10.50(g) to AMD's Quarterly Report on Form 10-Q for the period ended March 30, 1997, is hereby incorporated by reference. 85 Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 92
    ... AMD's Annual Report on Form 10-K for the fiscal year ended December 31, 2000, is hereby incorporated by reference. AMD Holding Research, Design and Development Agreement, dated as of March 11, 1997, between AMD Saxony Holding GmbH and AMD, filed as Exhibit 10.50(k) to AMD's Quarterly Report on Form...

  • Page 93
    ..., dated as of July 30, 1999, among AMD, AMD International Sales and Service, Ltd. and Bank of America NT&SA, as agent, filed as Exhibit 10.51(a) to AMD's Quarterly Report on Form 10-Q for the period ended June 27, 1999, is hereby incorporated by reference. 87 Source: ADVANCED MICRO DEVIC, 10...

  • Page 94
    ... 27, 2002, among AMD, AMD International Sales and Service, Ltd., and General Electric Capital Corporation, as agent, filed as Exhibit 10.53 to AMD's Quarter report on Form 10-Q for the period ended September 29, 2002, is hereby incorporated by reference. "S" Process Development Agreement, dated as...

  • Page 95
    ... charges in the fourth quarter. A Current Report on Form 8-K dated November 25, 2002 reporting under Item 5-Other Events was filed announcing the completion of the underwritten offering of our 4.50% Convertible Senior Notes due 2007. 2. 3. 89 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 96
    ... duly authorized. March 14, 2003 ADVANCED MICRO DEVICES, INC. By: / S/ ROBERT J. RIVET Robert J. Rivet Senior Vice President, Chief Financial Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons, on behalf of the...

  • Page 97
    ...SARBANES-OXLEY ACT OF 2002 I, Hector de J. Ruiz, certify that: 1. I have reviewed this annual report on Form 10-K of Advanced Micro Devices, Inc.; 2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make...

  • Page 98
    ... SARBANES-OXLEY ACT OF 2002 I, Robert J. Rivet, certify that: 1. I have reviewed this annual report on Form 10-K of Advanced Micro Devices, Inc.; 2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make...

  • Page 99
    ...Sarbanes-Oxley Act of 2002, the undersigned officer of Advanced Micro Devices, Inc. (the "Company") hereby certifies, to such officer's knowledge, that: (i) the Annual Report on Form 10-K of the Company for the annual period ended December 29, 2002 (the "Report") fully complies with the requirements...

  • Page 100
    ...Sarbanes-Oxley Act of 2002, the undersigned officer of Advanced Micro Devices, Inc. (the "Company") hereby certifies, to such officer's knowledge, that: (i) the Annual Report on Form 10-K of the Company for the annual period ended December 29, 2002 (the "Report") fully complies with the requirements...

  • Page 101
    ...schedule of Advanced Micro Devices, Inc., included in this Annual Report (Form 10-K) for the year ended December 29, 2002: • Registration Statements on Forms S-8 (Nos. 33-10319, 33-26266, 33-36596 and 33-46578) pertaining to the Advanced Micro Devices, Inc. 1982 and 1986 Stock Option Plans and the...

  • Page 102
    ... to the 4.75% convertible debentures; and Post-Effective Amendment No. 7 to the Registration Statement on Form S-3 (No. 333-84028) pertaining to the 4.75% convertible debentures. /s/ San Jose, California March 12, 2003 F-7 ERNST & YOUNG LLP Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 103
    Table of Contents SCHEDULE II ADVANCED MICRO DEVICES, INC. VALUATION AND QUALIFYING ACCOUNTS Years Ended December 31, 2000, December 30, 2001 and December 29, 2002 (in thousands) Additions Charged (Reductions Credited) To Operations Balance Beginning of Period Deductions(1) Balance End of Period...

  • Page 104
    ... a majority of the members of the Board in office prior to the happening of any event and who are still in office after such event, determines in its sole discretion within one year after such event, that as a result of such event there has been a Change of Control. Source: ADVANCED MICRO DEVIC, 10...

  • Page 105
    ...of whatever tax returns and other documents may be necessary to perform the calculation. 4. Termination of Employment Following Change of Control. shall have occurred, you shall be If any of the events described in Section 1 hereof constituting a Change of Control 2 Source: ADVANCED MICRO DEVIC, 10...

  • Page 106
    ... rights, or the receipt of restricted stock awards or the lapse of restrictions on such awards. If you were employed by the Company and/or any of its subsidiaries for less than one full calendar year immediately preceding the Change of 3 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 107
    ... the Date of Termination. (3) Accrued Bonus. The Company shall pay you an amount equal to the pro rata amount of the annual bonus accrued under the Company's Executive Bonus Plan for the portion of the year to the Date of Termination. (4) Company Car. The Company shall allow you the continued use of...

  • Page 108
    ... pay, amounts or benefits payable under any employment agreement or any bonus or other compensation plans, stock option plan, stock ownership plan, stock purchase plan, life insurance plan, health plan, disability plan or similar plan. 6. Payment Obligations Absolute. The Company's obligation to pay...

  • Page 109
    ..., termination or invalidity hereof; or (ii) the provision of or failure to provide any other benefits upon a Change of Control pursuant to any other employment agreement, bonus or compensation plans, stock option plan, stock ownership plan, stock purchase plan, life insurance plan or similar plan or...

  • Page 110
    ... any benefits. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Delaware. The provisions of this Agreement, and any payment provided for hereunder, shall not reduce any amounts otherwise 7 Source: ADVANCED MICRO DEVIC, 10...

  • Page 111
    ... sets forth our agreement on the subject matter hereof, kindly sign and return to the Company the enclosed copy of this letter which will then constitute our agreement on this subject. Sincerely, ADVANCED MICRO DEVICES, INC. By: Hector de J. Ruiz Agreed to this of day 20 (Signature) 8 Source...

  • Page 112
    ...SAXONY LIMITED LIABILITY COMPANY & CO. KG and DRESDNER BANK AG and the other Banks and Financial Institutions named herein and DRESDNER BANK LUXEMBOURG S.A. to the SYNDICATED LOAN AGREEMENT dated 11 March 1997 (as amended from time to time) AND OTHER OPERATIVE DOCUMENTS Source: ADVANCED MICRO DEVIC...

  • Page 113
    INDEX Preamble Page §1 §2 §3 §4 §5 Definitions Amendment to the Loan Agreement Condition Precedent Representations and Warranties Miscellaneous 2 5 5 9 10 12 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 114
    ...Support Agreement Amendment Agreement to the Sponsors' Guaranty Amendment Agreement to the AMD Saxonia Security Assignment of Fixed/Moveable Assets (Sachanlagevermögen) Management Plan... Opinion from Ernst & Young relating to the Management Plan 3 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 115
    ... 1. AMD SAXONY LIMITED LIABILITY COMPANY & CO. KG, Dresden, (formerly AMD Saxony Manufacturing GmbH) registered in the Commercial Register of the local court of Dresden under HRA 4896, - hereinafter referred to as "AMD Saxonia" - DRESDNER BANK AG, - hereinafter referred to as the "Security Agent...

  • Page 116
    ... in its entirety and replaced by a new sub-clause (vi) as follows: "(vi) the letters from C&L Deutsche Revision AG to Dresdner Kleinwort Wasserstein/Dresdner Bank AG dated 22 May 2002, 19 November 2002, 4 December 2002 and 5 December 2002." 5 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 117
    ... under the aforesaid shortfall guarantees)" 2.1.4 § 7.2 shall be deleted in its entirety and replaced by a new § 7.2: "7.2 The Facilities shall be amortised in semi-annual repayment instalments in accordance with the following amortisation schedule on the last Banking Day of the relevant...

  • Page 118
    ... as amended. The Banks, the Agent and the Security Agent acknowledge that AMD Saxonia may transfer such fixed and current assets between the Plant, the Design Center and the ATPC Center in the ordinary course of its business (i.e. for operative reasons)." 7 Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 119
    ... Agreement set out inSchedule 30, as amended). Notwithstanding the above, AMD Saxonia undertakes not at any time to transfer or dispose of or to withdraw amounts standing to the credit of the Project Accounts which would result in a breach of the Minimum Liquidity Covenant, and the Security Agent is...

  • Page 120
    ... of the Guarantors relating to the amendments to the Loan Agreement and the Operative Documents referred to therein; 3.1.6 Written acceptance of the Guaranty Decision by AMD Inc. and AMD Saxonia; 9 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 121
    ...Plan, as set out in Schedule 13; Written evidence that (i) the Banks under the Loan and Security Agreement of 13.7.1999 and (ii) the Banks under the Term Loan and Security Agreement of 27.9.2002, each as amended from time to time... party in order 10 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 122
    ..., the Amendment Agreements and all other documents referred to in § 3.1 to which AMD Inc., AMD Saxonia, AMD Holding, AMD Saxony LLC and AMD Admin. are party constitute-or at the time of their execution will constitute-legal and valid binding 11 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 123
    ...must be submitted to and approved by the Agent. §5 Miscellaneous 5.1 This Agreement forms part of the Loan Agreement. All references in ...Security Agent shall be deemed to be a reference to those terms and conditions in force from time to time. 12 5.2 5.3 5.4 5.5 5.6 Source: ADVANCED MICRO DEVIC...

  • Page 124
    ... LIABILITY COMPANY & CO. KG represented by its general partner AMD Saxony LLC By: /s/ Hans R. Deppe DRESDNER BANK AG, (as Security Agent and Bank) /s/ Prellwitz Paul Other Banks: KREDITANSTALT FÃœR WIEDERAUFBAU /s/ Prellwitz Paul DZ BANK AG DEUTSCHE ZENTRAL-GENOSSENSCHAFTSBANK, Frankfurt am Main...

  • Page 125
    ...Prellwitz Paul ING BHF-BANK Aktiengesellschaft, Niederlassung Leipzig /s/ Prellwitz Paul COMMERZBANK AKTIENGESELLSCHAFT, Filiale Dresden /s/ Prellwitz Paul ... /s/ Prellwitz Paul ABN AMRO BANK (DEUTSCHLAND) AG, Frankfurt /s/ Prellwitz Paul 14 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 126
    BANK AUSTRIA CREDITANSTALT AG, Wien /s/ Prellwitz Paul THE SUMITOMO MITSUI BANKING CORPORATION, Niederlassung Düsseldorf /s/ Prellwitz Paul DRESDNER BANK LUXEMBOURG S.A. (as Agent and Paying Agent) /s/ Prellwitz Paul 15 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 127
    ...(i) the Plant and (ii) the integrated Design Center; and WHEREAS, the Sponsors, the Additional Partner Companies, the Agent and the Security Agent desire to amend the Sponsors' Support Agreement dated 11 March 1997 between AMD Inc., AMD Holding, the Additional Partner Companies, Dresdner Bank AG, as...

  • Page 128
    ... inSections 12.1 and12.2 of the Sponsors' Support Agreement shall be repeated by AMD Inc. and the Sponsors, respectively on the date hereof except to the extent any such representation and warranty expressly relates solely to an earlier date. 2 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 129
    ... to be duly executed and delivered by its respective officer or agent thereunto duly authorised as of the date first above written. ADVANCED MICRO DEVICES, INC. By: /s/ ROBERT J. RIVET Its: AMD SAXONY HOLDING GMBH By: /s/ HANS R. DEPPE Its: 3 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 130
    AMD SAXONY ADMIN GMBH By: /s/ HANS R. DEPPE Its: AMD SAXONY LLC By: /s/ HANS R. DEPPE Its: DRESDNER BANK LUXEMBOURG S.A., as Agent /s/ PRELLWITZ PAUL DRESDNER BANK AG as Security Agent /s/ PRELLWITZ PAUL 4 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 131
    Schedule 1 AMENDED AND RESTATED SPONSORS' SUPPORT AGREEMENT Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 132
    ... JUNE 1999, 20 FEBRUARY 2001, 3 JUNE 2002 AND 20 DECEMBER 2002 between ADVANCED MICRO DEVICES, INC., AMD SAXONY HOLDING GMBH, AMD SAXONY LLC, AMD SAXONY ADMIN GMBH and DRESDNER BANK AG, as Security Agent, and DRESDNER BANK LUXEMBOURG S.A., as Agent Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 133
    ... Unconditional Representations and Warranties Covenants Costs and Expenses; Indemnities; Taxes; Etc. Miscellaneous Governing Law, Jurisdiction, and Language Schedule I Schedule II - [left intentionally blank] - Sponsors' Disclosure Schedule 7 Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 134
    ...' SUPPORT AGREEMENT, dated 11 March 1997, as amended, is made among ADVANCED MICRO DEVICES, INC., a corporation organized and existing under the laws of the State of Delaware, United States of America, with its chief executive office and principal place of business at One AMD Place, Sunnyvale...

  • Page 135
    ... to Sponsors' Support Agreement dated 3 June 2002; NOW, THEREFORE, the Sponsors, the Additional Partner Companies, the Agent (for itself and on behalf of the Banks), and the Security Agent (on behalf of the Secured Parties), agree as follows: ARTICLE I Definitions and Accounting Terms SECTION...

  • Page 136
    ... Bank Accounts, and each other instrument or document designated by the Agent (with the consent of each AMD Company) as an AMD Admin Security Document under and for purposes of this Agreement. "AMD Companies" means AMD Saxonia, AMD Admin, AMD Holding, AMD Saxony LLC and AMD Inc., collectively. "AMD...

  • Page 137
    ... AMD Holding and the Security Agent dated 3 June 2002. "AMD Holding Research Agreement" means the AMD Holding Research, Design and Development Agreement, in the form set out inSchedule 34 to the Loan Agreement, between AMD Inc. and AMD Holding. "AMD Holding Security" means all collateral security...

  • Page 138
    ...Interests in AMD Saxony LLC between AMD Inc. and the Security Agent dated 3 June 2002. "AMD Inc. Primary Bank Credit Agreement" means, from time to time: (i) (ii) the AMD Inc. 1999 Loan and Security Agreement; or if the agreement referred to inparagraph (i) above is terminated or cancelled, then any...

  • Page 139
    ...the Agreement, in the form set out inSchedule 50a to the Loan Agreement, between AMD Saxonia and AMD "AMD Saxonia Land Charge" means the Grundschuld, in the form set out inSchedule 43 to the Loan Agreement, between AMD Saxonia and the Security Agent. 13 Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 140
    ... and Fourth Amendment to Sponsors' Support Agreement between the Sponsors, AMD Saxony LLC, AMD Admin, the Agent and the Security Agent; (iii) the Third Amendment to the AMD Saxonia Wafer Purchase Agreement between AMD Holding and AMD Saxonia; (iv) the 14 Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 141
    ... between the AMD Companies, the Security Agent and the Agent. "Approved Project Budget" means: (i) that certain Project Budget, in the form set out inSchedule 6 to the Loan Agreement, which has been prepared by AMD Saxonia and approved by each Sponsor; and at any time after such Project Budget has...

  • Page 142
    ..."Business Day" means any day of the year on which banks are generally open for business in London, Frankfurt am Main, Dresden, Luxembourg and, to the extent the same relates to any obligation to be performed by AMD Inc. or AMD Saxony LLC, San Francisco. "Capital Expenditure" means all acquisition or...

  • Page 143
    ...if larger) of the indebtedness, obligation, or other liability guaranteed thereby. "Contractor" means Meissner & Wurst GmbH & Co., Roßbachstraße 38, 70499 Stuttgart, registered in the Commercial Register of the Stuttgart County Court HRA 1208. 17 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 144
    ... designated by the AMD Companies (with the consent of the Agent) in addition to or in substitution for any of the above-named documents or agreements as a "Conversion Document." "Conversion Effective Date" means the date on which the Registration takes effect. 18 Source: ADVANCED MICRO DEVIC...

  • Page 145
    ... in Deutsche Marks, which results from the conversion of Dollars to Deutsche Marks at a spot rate of exchange equal to the greater of (i) DM 1.45 for $1.00 and (ii) the Agent's spot rate of exchange, expressed in Deutsche Marks, for the sale of Dollars for Deutsche Marks prevailing on the date two...

  • Page 146
    ... current assets for the Project but excluding Excepted Software Agreements. "Equity Capital" means (i) with respect to AMD Saxonia (a) at any time prior to the Conversion Effective Date, registered stated capital (Stammkapital) and (b) at any time on or after the Conversion Effective Date, capital...

  • Page 147
    ... calendar month or a calendar quarter, as the case may be), but shall be reconciled on an annual basis), and (y) in the case of AMD Inc. or AMD Saxony LLC or their respective financial statements, generally accepted accounting principles set forth from time to time in the opinions and pronouncements...

  • Page 148
    ... to which such Person is a party; all other items which, in accordance with GAAP, would be included as liabilities on the liability side of the balance sheet of such Person as of the date at which Indebtedness is to be determined; 22 (iii) (iv) (v) Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 149
    ... of such Person to pay the deferred purchase price of property or services, and indebtedness (including pre-paid interest thereon) secured by an Encumbrance on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements...

  • Page 150
    ... and Restated Management Service Agreement, in the form set out inSchedule 37 to the Loan Agreement, between AMD Inc., AMD Holding, and AMD Saxonia. "Material Adverse Effect" means (i) a material adverse change in, or a material adverse effect upon, the operations, business, properties, condition...

  • Page 151
    ... all times from the date on which the Fifth Amendment to the Loan Agreement dated 20 December 2002 becomes unconditional in all respects until the payment in full of all Secured Obligations, the balance standing to the credit of the Project Accounts maintained with the Security Agent at its offices...

  • Page 152
    ..."Paying Agent" has the meaning assigned to that term in thesecond recital of this Agreement. "Perform in Accordance with the Plans and Specifications" means, for purposes of the Technical Completion tests, and when used for the period from and after Technical Completion, the performance by the Plant...

  • Page 153
    ... Design Center, as the same may be amended by AMD Saxonia from time to time with the consent of each Sponsor and the Agent (which consent, in the case of each Sponsor, shall not be unreasonably delayed or withheld);provided, that amendments to the plans and specifications 27 Source: ADVANCED MICRO...

  • Page 154
    ... of the Agent. "Plant" means the advanced silicon wafer production facility constructed or to be constructed by AMD Saxonia in or near Dresden, Germany to manufacture integrated circuits in wafer form using high-volume semi-conductor wafer fabrication processes. "Primary Secured Obligations" means...

  • Page 155
    ... such Person or any of its property is subject. "Research Agreements" means, collectively, the AMD Saxonia Research Agreement and the AMD Holding Research Agreement. "Revolving Loan Facility Agreement" means the $750,000,000 subordinated unsecured Revolving Loan Facility Agreement dated 20 February...

  • Page 156
    ..., each Person party to a contract or other agreement with AMD Saxonia in the capacity of a supplier of services for the Plant or the Design Center. "Service Supplier's Consent and Agreement" means, with respect to a Service Supplier, such Service Supplier's Consent and Agreement, in the form set out...

  • Page 157
    ... with the Sponsors' Subordination Agreement. "Sponsors' Subordination Agreement" means the Sponsors' Subordination Agreement, in the form set out inSchedule 30 to the Loan Agreement, executed by the Sponsors, AMD Saxonia, and the Security Agent. 31 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 158
    ...), (iv) the date of Technical Completion, (v) the Conversion Effective Date and (vi) each date the Sponsors deliver the certificate referred to inSection 13.1(i)(c). "Stock Offering" means a public or private sale or other placement of stock of AMD Inc. in the capital markets (which, for avoidance...

  • Page 159
    ... the Sponsors, AMD Saxonia, the Agent, and the Banks. "Total Tranche A Commitment Amount" means DM 1,500,000,000 (one billion five hundred million Deutsche Marks), as such amount shall be reduced by any reductions to (but not utilizations of) the commitments of the Banks under "Facility A" under the...

  • Page 160
    ... term relating to the capital structure of a German limited liability company shall, following the Conversion Effective Date, be deemed to be a reference to the capital (Haftsummen and Pflichteinlagen) or capital reserves of a limited partnership under German law, save to the extent the context...

  • Page 161
    ...Effective Date shall be considered contributions to its Equity Capital for purposes of thisSection 2.2(i); and in addition to the Equity Capital contributed or to be contributed pursuant toSection 2.2(i) hereof, one or more additional instalments aggregating DM 35 (ii) Source: ADVANCED MICRO DEVIC...

  • Page 162
    ...' Loans, the exact amount thereof being equal to the Deutsche Mark Equivalent of $200,000,000 (two hundred 36 the then aggregate outstanding principal amount of the Advances, the then aggregate outstanding principal amount of Sponsors' Loans, (b) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 163
    ...2.1 or (except as, and to the extent, provided inclause (iii) above) otherwise; of any obligation to make Class A Sponsors' Loans (or to contribute additional Equity Capital or other contributions to AMD Saxonia's capital 37 (ii) (iii) (iv) (b) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 164
    ... to Equity Capital or AMD Saxonia's capital reserves in lieu thereof), this Article III; and following a demand for payment by the Agent under the Sponsors' Guaranty, the Sponsors shall have paid all amounts payable under the Sponsors' Guaranty. 38 (b) Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 165
    ... Secured Obligations at such time); and December 31, 1999; provided,however, that such Class A Sponsors' Loans shall be required to be made in whole or in part at any time prior to the aforesaid dates if, but only to the extent that, the ratio of: (x) the sum of 39 (b) Source: ADVANCED MICRO DEVIC...

  • Page 166
    ...undertake that either Sponsor or both Sponsors will make available to AMD Saxonia an unsecured, subordinated revolving loan facility in an aggregate principal amount of $750,000,000 (seven hundred fifty million Dollars) with a term of no earlier 40 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 167
    ...the Sponsors' Subordination Agreement. ARTICLE IV Project Costs SECTION 4.1 Project Costs. In addition to, and not in limitation of, their other obligations contained in this Agreement and the other Operative Documents, the Sponsors, jointly and 41 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 168
    ...Agent or the Security Agent under either the AMD Holding Share Pledge Agreement, the AMD Inc. Share Pledge Agreement, the AMD Saxonia Assignment (U.S.A.), the AMD Inc. Pledge Agreement Over Membership Interests in AMD Saxony LLC, the AMD Holding Share Pledge Agreement (AMD Admin), the AMD Saxony LLC...

  • Page 169
    ... mutandis to the amount set forth inSection 2.1 of the Sponsors' Guaranty and any recovery by the Agent from the Sponsors hereunder shall,prot anto, reduce the amount available to be recovered from the Sponsors under the Sponsors' Guaranty. 43 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 170
    ... doubt: (i) the obligations of the Sponsors contained in thisArticle VI are in addition to, and not in limitation of, their obligations contained elsewhere in this Agreement and in the other Operative Documents, and shall survive Completion; and 44 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 171
    ... underSection 6.3 (a) shall terminate from the date of any foreclosure over the shares of AMD Holding, the membership interests of AMD Saxony LLC, the shares in AMD Admin or over the partnership interests in AMD Saxonia under the Security Documents. 45 (b) Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 172
    ...in AMD Saxony LLC. SECTION 8.2 AMD Holding Security Documents. AMD Holding has granted a first priority security interest in the AMD Holding Security pursuant to and on the terms and conditions set forth in the AMD Holding Security Documents. SECTION 8.3 AMD Saxony LLC Security Documents. AMD Saxony...

  • Page 173
    ... Nature of Obligations. The obligation of the Sponsors and the Additional Partner Companies to perform their respective obligations under this Agreement, and the right of AMD Saxonia or the Agent or the Security Agent, as applicable, 47 (ii) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 174
    ...Security Agent as follows: (i) Organization; Corporate Power. AMD Inc. and each Material AMD Inc. Subsidiary: (a) is a corporation, limited partnership or limited liability company, as the case may be, duly organized, validly existing, and (where the concept has a technical meaning) in good standing...

  • Page 175
    ... of any nature upon or with respect to any of the properties now owned or hereafter acquired by any of the AMD Companies (other than any right of set-off or banker's lien or attachment that the Agent, the Security Agent, or any Bank may have under the Operative Documents or applicable law), and none...

  • Page 176
    ..., show all material indebtedness and other liabilities, direct or contingent, of AMD Inc. and its consolidated Subsidiaries as of the date thereof, including liabilities for taxes, material commitments, and Contingent Liabilities. 50 (y) (z) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 177
    ... be expected to have a Material Adverse Effect. (ix) Title to Properties; Encumbrances. Each AMD Company and each other Material AMD Inc. Subsidiary has good record and marketable title in fee simple to, or valid leasehold interests in (or the 51 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 178
    ... of the Loan Agreement Effective Date, there are no Material AMD Inc. Subsidiaries other than those specifically disclosed in the Disclosure Schedules; AMD Inc. is the direct legal and beneficial owner of 100% of the issued and outstanding shares of capital stock of AMD Holding, all of which shares...

  • Page 179
    ... Adverse Effect. Except as specifically disclosed in the Disclosure Schedules, to the best knowledge of AMD Inc.: (a) no slogan or other advertising device, product, process, method, substance, part, or other material now employed, or now contemplated to be employed, by any AMD Company or any...

  • Page 180
    ... construction, ownership, use, and operation by AMD Saxonia of the Plant and the Design Center or which are required in order that the Plant and the Design Center may be operated for their intended purposes and Perform in Accordance with the Plans and Specifications, have been listed on Schedule 20...

  • Page 181
    ... Loan and Security Agreement. Accuracy of Information. As of the date this representation and warranty is made or reaffirmed, as the case may be, all factual information then or theretofore furnished by or on behalf of any AMD Company to the Agent or any Bank or the Technical Advisor for purposes...

  • Page 182
    ... facts and that actual results during the period or periods covered thereby may differ from the projected or forecasted results). Without limiting the generality of the foregoing, as of the Loan Agreement Effective Date, no new information has become available which was not provided to the Technical...

  • Page 183
    ...award presently in effect binding on such AMD Company, or of the Organizational Documents of such AMD Company; result in a breach of, result in a mandatory prepayment or acceleration of indebtedness evidenced or secured by, or constitute a default under, any 57 (b) Source: ADVANCED MICRO DEVIC, 10...

  • Page 184
    ..., and enforceable security interest in all rights, title, and interest of AMD Holding in the AMD Holding Security described therein. When each such Security Document is duly recorded or filed in the applicable recording or filing office(s), if any, and the recording or filing fees and taxes, if any...

  • Page 185
    ... interest in all rights, title, and interest of AMD Saxony LLC in the AMD Saxony LLC Security described therein. When each such Security Document is duly recorded or filed in the applicable recording or filing office(s), if any, and the recording or filing fees and taxes, if any, in respect thereof...

  • Page 186
    ... against AMD Holding, AMD Admin, AMD Saxony LLC, or AMD Saxonia or any of their respective properties which: (a) purport to affect or pertain to this Agreement or any other Operative Document, or the entirety of the transactions contemplated hereby or thereby; or 60 Source: ADVANCED MICRO DEVIC, 10...

  • Page 187
    ...all real property necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. None of AMD Holding, AMD Admin, or AMD Saxony LLC has any real property or leasehold...

  • Page 188
    ... to be employed, by AMD Holding, AMD Admin, AMD Saxony LLC or AMD Saxonia infringes upon any rights held by any other Person; no claim or litigation regarding any of the foregoing is pending or, to the best knowledge of the Sponsors, threatened; and 62 (b) Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 189
    ...construction, ownership, use, and operation by AMD Saxonia of the Plant and the Design Center or which are required in order that the Plant and the Design Center may be operated for their intended purposes and Perform in Accordance with the Plans and Specifications, have been listed onSchedule 20 to...

  • Page 190
    ... at such time or times as may be necessary to avoid material delay in, or material restrictions on the use or operation of, the Plant and the Design Center. (xix) Interruption of Business. Neither the business nor the properties of AMD Holding, AMD Admin, AMD Saxony LLC or AMD Saxonia are presently...

  • Page 191
    ... any such representation and warranty expressly relates solely to an earlier date, and except, in the case of the Sponsors' Warranty Date described inclause (vi) of the definition thereof, as otherwise set forth in the certificate referred to therein. 65 Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 192
    ... been developed and used in connection with the financial statements referred to inclause (x) above; as soon as available, and in any event within ninety (90) days after the end of each Fiscal Year of AMD Inc., (x) financial statements consisting of a 66 (b) (c) Source: ADVANCED MICRO DEVIC, 10...

  • Page 193
    ... applied, the financial position and results of operations of AMD Inc. and its Subsidiaries, and (y) a certificate from each Sponsor confirming, as of the date of such certificate, that, except as otherwise therein set forth, each of the representations and warranties made by each AMD Company in any...

  • Page 194
    ... of Euro 250 in AMD Saxonia in accordance with the Assignment and Trust Agreement and to ensure that, at no time thereafter, shall AMD Saxony LLC acquire or become entitled to acquire a capital partnership interest in AMD Saxonia. 68 (iii) (iv) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 195
    ... Holding, AMD Admin and AMD Saxony LLC to promptly execute, a declaration of liability substantially in the same form attached as Appendix Four to the SAB/Dresdner Subsidy Agreement, amended to reflect the addition of the Additional Partner Companies. (viii) in respect of Product Liability Insurance...

  • Page 196
    ... provisions, are hereby incorporated herein by reference as if such terms were set forth herein in full;provided,however, that: (i) with respect to the AMD Inc. Primary Bank Credit Agreement referred to inclause (i) of the definition thereof: 70 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 197
    ... and definitions of the applicable AMD Inc. Primary Bank Credit Agreement, as incorporated by reference in this Agreement, shall continue to be binding on AMD Inc. after giving effect to any consent or waiver with respect to such provisions or to any amendment or 71 Source: ADVANCED MICRO DEVIC, 10...

  • Page 198
    ... Material Adverse Effect. promptly following each of AMD Holding's, AMD Admin's and AMD Saxony LLC's, as the case may be, receipt or transmission thereof, unless otherwise concurrently delivered by another AMD Company to the Agent under an 72 (ii) (iii) (iv) (v) Source: ADVANCED MICRO DEVIC, 10...

  • Page 199
    ... to complete the Project in accordance with the Plans and Specifications. cause each of AMD Holding and AMD Admin to promptly pay proceeds from any tax refunds to AMD Saxonia. furnish to the Agent (with copies for each of the Banks): 73 (x) (xi) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 200
    ..., amendment or modification, of any Operative Document, other than (w) the AMD Inc. Primary Bank Credit Agreement (which may be amended, modified or terminated in accordance withSection 13.3), (x) the Equipment Supply Contracts that are not 74 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 201
    ... use of the Plant and the Design Center (or of the rights of the Banks with respect thereto) in any material respect, or (y) the capacity of the Plant to perform, on a substantially continuous basis, the functions for which it was specifically designed in accordance with the plans and specifications...

  • Page 202
    ... to AMD Saxony LLC, the re-transfer of Euro 250 capital interest (Pflichteinlage) in AMD Saxonia in connection with the Conversion, or redeem any of its shares, declare or pay any dividend thereon or make any distribution to its shareholders, except for any such distribution made as a result of...

  • Page 203
    ...to AMD Holding, AMD Admin or AMD Saxony LLC, as the case may be, than would be the case if such transaction had been effected with a Person other than AMD Inc. or an Affiliate thereof. (xiv) open or maintain a bank account with any Person, except for demand or other deposit accounts at the Agent and...

  • Page 204
    ... thereby; and such other information with respect to the business affairs, financial condition, and/or operations of the Additional Partner Companies as the Agent or any Bank (acting through the Agent) may from time to time 78 (b) (c) (d) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 205
    ... the business or businesses at any time conducted by each of the Additional Partner Companies except to the extent that any such noncompliance, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. 79 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 206
    ... Admin nor (prior to the Substitution (if any)) AMD Saxony LLC will, unless the Security Agent shall have enforced any of the Security or the Agent (acting on the instructions of an Instructing Group) shall have otherwise consented in writing: 80 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 207
    ... to any interest or currency swap, hedge, exchange, or other similar obligation. purchase any shares of, or interest in, any Person, other than, with respect to AMD Saxony LLC, the re-transfer of Euro 250 partnership interest in AMD 81 (x) (xi) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 208
    ... to the Additional Partner Companies than would be the case if such transaction had been effected with a Person other than AMD Inc. or an Affiliate thereof. (xiv) open or maintain a bank account with any Person, except for demand or other deposit accounts at the Agent and at Security Agent. (xv...

  • Page 209
    ... AMD Holding or such Additional Partner Company;provided,however, that the provisions of thisSection 13.8 shall not be construed to absolve AMD Inc. for its liability, whether in damages or otherwise, for actions or omissions constituting fraud or misrepresentation or breach of warranty; andprovided...

  • Page 210
    ... Sponsors' Loans to AMD Saxonia or contribute Equity Capital (or other contributions to AMD Saxonia's capital reserves) to AMD Holding (and AMD Inc. shall to the extent necessary and depending on where the Liability arises, contribute sufficient funds or 84 Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 211
    ... by either of the Sponsors or the Additional Partner Companies hereunder is required in respect of any Taxes pursuant to any applicable law, rule, or regulation, then such Sponsor or Additional Partner Company will, subject toSection 14.5(d), 85 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 212
    ...or penalties that may become payable by such Person as a result of any such failure. Each Person entitled to receive a payment hereunder that is entitled to claim an exemption (either on its own account or for the account of the 86 (iii) (c) (d) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 213
    ...Agent, or such Bank in Euro, the Security Agent, the Agent, the Paying Agent, or such Bank, as the case may be, shall remit to the relevant Sponsor or Additional Partner Company such excess. (b) SECTION 14.7 License Agreement. With respect to the License Agreement, 87 Source: ADVANCED MICRO DEVIC...

  • Page 214
    ..., the Paying Agent, any Bank, any receiver appointed to operate the Plant, or a third party purchaser of the capital stock, or of all or substantially all of the assets, of AMD Saxonia (herein collectively referred to as the "Beneficiaries" and individually as a "Beneficiary"), based on: (i) its use...

  • Page 215
    ... AMD Holding nor the Additional Partner Companies shall have the right to transfer or assign their respective rights under this Agreement without the prior written consent of the Agent and the Security Agent. SECTION 15.5 Notice. All notices, demands, instructions, and other communications required...

  • Page 216
    ... No.: (352) 4760-43222 To AMD Inc.: Advanced Micro Devices, Inc. One AMD Place Sunnyvale, California 94088 Attention: General Counsel Facsimile No.: (1) (408) 749-3945 To AMD Holding: AMD Saxony Holding GmbH Wilschdorfer Landstrasse 101 01109 Dresden Attention: Geschäftsführer Facsimile No...

  • Page 217
    ...AMD Saxony LLC state that Advanced Micro Devices GmbH, whose address is Rosenheimerstrasse 143b, 81671 Munich, Germany, Attention: Legal Department, Tel: +49 89 450 530, Fax: +49 89 406 490, Telex: 841523883, is their respective accredited agent for service of process and hereby 91 Source: ADVANCED...

  • Page 218
    ... of the Agent or the Security Agent to take suits, actions, or proceedings against a Sponsor or AMD Admin or AMD Saxony LLC to enforce any judgment rendered by the courts in Frankfurt am Main in any other court or entity of competent jurisdiction where such Sponsor or AMD Admin or AMD Saxony LLC, as...

  • Page 219
    ... respective officer or agent thereunto duly authorised as of the date first above written. ADVANCED MICRO DEVICES, INC. By: Its: AMD SAXONY HOLDING GMBH By: Its: AMD SAXONY ADMIN GMBH By: Its: AMD SAXONY LLC By: Its: DRESDNER BANK LUXEMBOURG S.A., As Agent By: Its: 93 Source: ADVANCED MICRO DEVIC...

  • Page 220
    DRESDNER BANK AG, as Security Agent By: Its: 94 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 221
    ... Agreement"), dated 20 December 2002, is made between ADVANCED MICRO DEVICES, INC., a corporation organized and existing under the laws of the State of Delaware, United States of America, with its chief executive office and principal place of business at One AMD Place, Sunnyvale, California 94088...

  • Page 222
    ...with respect to any of the properties now owned or hereafter acquired by it; and Valid and Binding Obligations. The Sponsors' Guaranty, as amended by this Amendment Agreement, constitutes its legal, valid and binding obligations, enforce2 (b) (c) Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 223
    ... instrument. (b) (c) (e) Sections 15.1, 15.2, 15.5, 16.1, 16.2, and16.3 of the Sponsors' Support Agreement shall apply,mutatis mutandis, to this Amendment Agreement, as if set out herein in full. [Remainder of page intentionally left blank] 3 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 224
    ... date first above written. ADVANCED MICRO DEVICES, INC. By: /s/ ROBERT J. RIVET Its AMD SAXONY HOLDING GMBH By: /s/ HANS R. DEPPE Its DRESDNER BANK LUXEMBOURG AG, as Security Agent By: /s/ PRELLWITZ PAUL DRESDNER BANK AG, as Security Agent By: /s/ PRELLWITZ PAUL 4 Source: ADVANCED MICRO DEVIC...

  • Page 225
    Schedule 1 Amended and Restated Sponsors' Guaranty Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 226
    ...' GUARANTY, dated 11 March 1997, as amended, is made by ADVANCED MICRO DEVICES, INC., a corporation organised and existing under the laws of the State of Delaware, United States of America, with its chief executive office and principal place of business at One AMD Place, Sunnyvale, California 94088...

  • Page 227
    ... hereby agree, for the benefit of the Secured Parties, as follows: ARTICLE I Definitions and Accounting Terms SECTION 1.1 Definitions. Unless otherwise defined herein, terms used herein have the meanings assigned to such terms in the Sponsors' Support Agreement. In addition, the following terms...

  • Page 228
    ... the Sponsors' Support Agreement, of even date herewith, between the Sponsors, the Additional Partner Companies (as defined therein), the Agent, and the Security Agent, as the same may at any time be amended or modified in accordance with the terms thereof and in effect. SECTION 1.2 Miscellaneous...

  • Page 229
    ...based on the officially fixed rate of conversion established in connection with the introduction of the Euro as the single currency of the Member States participating in the European Economic and Monetary Union. Such conversion shall be effective as of the date on which the Deutsche Mark is replaced...

  • Page 230
    ... Agent, the Agent, the Paying Agent, or any Bank securing any of the Guaranteed Obligations; or any other circumstance which might otherwise constitute a defense available to, or a discharge of, AMD Saxonia, any surety (Bürge), or any guarantor. 10 (d) (e) (f) (g) Source: ADVANCED MICRO DEVIC...

  • Page 231
    ... Security Agent, the Paying Agent, the Agent, or such Bank will execute and deliver to such Sponsor appropriate documents (without recourse and without representation or warranty) necessary to evidence the transfer by subrogation to such Sponsor of an interest in the Guaranteed Obligations resulting...

  • Page 232
    ... of such Taxes by the Security Agent, the Agent, the Paying Agent or such Bank, as the case may be) as is necessary in order that the net amount received by the Security Agent, the Agent, the Paying Agent, or such Bank after the payment of such Taxes (including 12 Source: ADVANCED MICRO DEVIC, 10...

  • Page 233
    ... into another currency, the rate of exchange used shall be that at which in accordance with normal banking procedures the Security Agent could purchase Euro with such other currency on the Business Day preceding that on which final judgment is given. 13 Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 234
    ... the Paying Agent, or such Bank in Euro, the Security Agent, the Agent, the Paying Agent, or such Bank, as the case may be, shall remit to the relevant Sponsor such excess. ARTICLE III Miscellaneous Provisions SECTION 3.1 No Waiver; Modifications in Writing. In addition to, and not in limitation of...

  • Page 235
    ... 3.5 Notice. All notices, demands, instructions, and other communications required or permitted to be given to or made upon any of the Persons listed below shall be in writing and shall be personally delivered or sent by registered or certified mail, postage pre-paid, return receipt requested, or by...

  • Page 236
    ... in, any and all of its balances, credits, deposits, accounts, or moneys then or thereafter maintained with the Security Agent, the Agent, the Paying Agent, or such Bank and any and all property of every kind or description of or in the name of AMD Holding now or hereafter, for any reason or purpose...

  • Page 237
    ...the event of any inconsistency, the English language version of any such document shall control. ADVANCED MICRO DEVICES, INC. By: Its AMD SAXONY HOLDING GMBH DRESDNER BANK LUXEMBOURG AG, as Agent By: Its DRESDNER BANK AG, as Security Agent 17 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 238
    ...'s rules and regulations promulgated under the Freedom of Information Act, pursuant to a request for confidential treatment. *** "S" PROCESS DEVELOPMENT AGREEMENT between INTERNATIONAL BUSINESS MACHINES CORP. and ADVANCED MICRO DEVICES, INC. Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 239
    ... Advanced Micro Devices having an office for the transaction of business at One AMD Place, P.O. Box 3453, Sunnyvale, CA 94088-3453 "(AMD)". IBM, and AMD may be individually referred to herein as a "Party," or collectively as the "Parties." WHEREAS, IBM has been developing leading edge semiconductor...

  • Page 240
    ... designs as mutually agreed by the Parties to be used as qualification vehicles in the Process Development Projects. For the avoidance of doubt, all of (i) through (iii) above shall be treated as Specific Results to the extent utilized in a Process Development Project. Source: ADVANCED MICRO DEVIC...

  • Page 241
    ... circuit elements formed at least in part of semiconductor material. For clarity, "Integrated Circuit" shall include charge-coupled devices ("CCDs"). *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 242
    ...mean any process, procedure, software, or hardware tools used in the packaging of integrated circuit products into single-chip packages, multi-chip packages, or any other higher levels of assembly, including but not limited to IBM's collapsible chip carrier Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 243
    ... Tools" means software (in source code form or in object code form), models and/or data, and other instrumentalities that are not commercially available and are either owned by a Party or under which a Party has the right to grant royalty-free licenses, and that are used in Process Development...

  • Page 244
    ... fabricated utilizing SOI Device Information and built on SOI Wafers. "Specific Results" shall mean information and items, other than i) Proprietary Tools, ii) Packaging Technology, iii) Mask Fabrication and Photoresist Technology, iv) Memory, v) SiGe Technology, and vi) Chip Designs, developed...

  • Page 245
    ... Coordinators" means the individuals referred to in Section 4.4, below. "Term" means the period of time from the Effective Date and ending on December 31, 2005. "Test Site" means a device or circuit evaluation site on a wafer. "Third Party" or "Third Parties" means an entity or entities other than...

  • Page 246
    ... work associated with the Process Development Projects. In addition, the Parties may mutually agree to utilize AMD development facilities for specifically defined elements of the Process Development Projects. If the Management Committee members so agree, such agreement shall be documented in writing...

  • Page 247
    ..., such owning Party may withdraw such information from use in the Process Development Projects and all such information in tangible form associated therewith shall be returned to such owning Party and such tangible information shall not become Specific Results. In the event of such withdrawal...

  • Page 248
    ... the CMOS 12S Process Development Project, as determined by the Project Leaders. Should AMD have any questions regarding the Documentation as they are transferring such Specific Results to their own facilities, IBM agrees to provide reasonable telephonic, videoconference or email support through its...

  • Page 249
    ... of an overall progress report to be prepared by the Project Leaders. The responsibilities of the Management Committee are set forth in Exhibit D. *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 250
    ... up to *** (***) Representatives to work in the ASTC. The assignment of such Representatives shall be mutually agreed to by the Project Leaders. Confidential information omitted and filed separately with the Securities and Exchange Commission. *** Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 251
    ... to the other in advance a set of documents setting forth all such rules, procedures and guidelines, including any updated versions thereof. *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 252
    ...or Yorktown Research facilities or AMD's Sunnyvale, Austin or Dresden facilities or other Representatives working on the Process Development Projects until at least one (1) year has passed between the date such employee stopped being engaged in semiconductor development, and the date of solicitation...

  • Page 253
    ...in U.S. dollars. The following information shall be included in the wire detail: Company Name Reason for Payment License Reference No. L024381B Confidential information omitted and filed separately with the Securities and Exchange Commission. 5.3 5.4 *** Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 254
    ...provided to, or purchased by, a Third Party and the obligation to pay this royalty will terminate the lesser of four (4) years from the initial date of *** or...Confidential information omitted and filed separately with the Securities and Exchange Commission. 5.6 *** Source: ADVANCED MICRO DEVIC, 10...

  • Page 255
    ..., COPYRIGHTS, TRADE SECRET, OR MASK WORK RIGHTS and ii) ANY IMPLIED WARRANTIES OR TERMS OF MERCHANTABILITY AND FITNESS OR USE FOR A PARTICULAR PURPOSE. Confidential information omitted and filed separately with the Securities and Exchange Commission. 6.2 *** Source: ADVANCED MICRO DEVIC, 10...

  • Page 256
    ... to enable it to manufacture and/or market the product (including products manufactured using the process technology to be developed under the Process Development Projects) at such time as it determines in its sole judgement that such action is required. Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 257
    ...receiving such information shall use the same efforts to avoid its publication or dissemination to Third Parties as it employs with respect to information of its own which it does not desire to be published or disseminated. For Specific Results of each Process Development Project and Background Know...

  • Page 258
    ... simple process flow information, excluding detailed process flow information or detailed process specifications, as necessary in order to enable installation of a process in a fabrication facility or to design and construct a facility to practice such process. 7.6 Source: ADVANCED MICRO DEVIC, 10...

  • Page 259
    ... of enabling sales of Integrated Circuits embodying the Specific Results to such customers. Such portions shall include the following Process roadmap and development schedule for Process Development Projects; Time schedule for development of device model library, and SPICE parameters; Design rules...

  • Page 260
    ... to AMD's flash memory venture for the purpose of producing flash memory products, no earlier than *** of the applicable Process Development Project. It is understood that employees of AMD's flash memory partner working within AMD's flash memory venture might be exposed to such disclosed information...

  • Page 261
    ... has other development projects and relationships being conducted in the ASTC facility, and the Parties shall take reasonable precautions to limit the Confidential information omitted and filed separately with the Securities and Exchange Commission. 7.9 7.10 *** Source: ADVANCED MICRO DEVIC, 10...

  • Page 262
    ... researching, developing, engineering, manufacturing, using, marketing, selling, servicing and otherwise disposing of (i) SOI Integrated Circuits other than ***, (ii) Integrated Circuits that combine Bulk CMOS and SOI Device Information other than ***, or (iii) Bulk CMOS products other than ***. AMD...

  • Page 263
    ... to a Process Development Project (e.g. kerf test structures) and create derivative works thereof, as reasonably necessary for IBM to carry out the license rights set forth herein. Unless otherwise authorized, this right shall not include any rights to utilize any product design information in such...

  • Page 264
    ...*** ("Extension Period"). *** means an enhanced version of the ***. The exact Strategic Technology Objectives will be negotiated by IBM and Confidential information omitted and filed separately with the Securities and Exchange Commission. 8.8 *** Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 265
    ..., including use in the development, manufacture, marketing, and maintenance of any products and services. The term "residuals" means that information in non-tangible form which may be mentally retained by those Representatives of a Party who have had access to Specific Results or the Background Know...

  • Page 266
    ... license to the other Party to use such Proprietary Tools outside the Process Development Projects in furtherance of their respective license rights set forth in Section 8. SECTION 10-OWNERSHIP OF SPECIFIC RESULTS 10.1 Except with respect to Designated Inventions, as set forth in Section 11 of this...

  • Page 267
    ... and obligations with respect to the relevant Specific Results provided for in this Agreement to carry out the activities set forth in this Agreement (including, but not limited to, Sections 7, 8 and 9). With respect to patents issued on said Designated Inventions, the license granted by the owning...

  • Page 268
    ... Party, or (c) any person (as such term is used in section 13(d) and 14(d) (2) of the Securities Exchange Act of 1934 (the Exchange Confidential information omitted and filed separately with the Securities and Exchange Commission. 12.2 12.3 *** Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 269
    ... of directors, as a result of a tender or exchange offer, open market purchases, privately negotiated purchases, or otherwise, only if such person and its Subsidiaries exceeded ten billion US dollars in revenue from the sale of microprocessor Semiconductor Products in calendar year 2001; or (ii...

  • Page 270
    ..., Microelectronics for electronic funds transfer to IBM: IBM, Director of Licensing United States of America Credit Account No. *** ABA No. *** *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 271
    ... pay all taxes (including, without limitation, sales and value added taxes but excluding income tax as specified below) imposed by its own national government, including any political subdivision thereof, as the result of the existence of this Agreement or the exercise Source: ADVANCED MICRO DEVIC...

  • Page 272
    ... claimed by the other Party based on any Third Party claim, except as specifically set forth in Section 17.2 (iii) above. Confidential information omitted and filed separately with the Securities and Exchange Commission. 17.2 17.3 17.4 *** Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 273
    ... dispute will be referred in writing to the senior executives named in Section 4.1.1, above, which senior executives shall discuss and meet in person, if necessary, in order to attempt to negotiate a resolution to the dispute. 18.2 18.3 18.3.2 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 274
    ... and ordinances. In addition, no Party and none of its agents or employees acting on behalf of said Party will export or re-export any confidential information of the other Party, or any process, product or service that is produced as a result of the use of such confidential information, to any...

  • Page 275
    ... it in any way affect the validity of any of this Agreement or any part thereof, or the right of either Party thereafter to enforce each and every provision of any of this Agreement. REMAINDER OF PAGE INTENTIONALLY LEFT BLANK 18.12 18.13 18.14 Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 276
    ...Title: /s/ HARRY A. WOLIN International Business Machines Corporation By: Name: Title: /s/ HARRY C. CALHOUN Harry A. Wolin Vice President, Intellectual Property December 28, 2002 Harry C. Calhoun Vice President Strategy Technology Group December 28, 2002 Date: Date: Source: ADVANCED MICRO DEVIC...

  • Page 277
    ... EXHIBIT C: AMD STAFFING* EXHIBIT D: MANAGEMENT COMMITTEE RESPONSIBILITIES EXHIBIT E: PROJECT LEADER RESPONSIBILITIES EXHIBIT F: VISITATION GUIDELINES EXHIBIT G, H and I, Intentionally Left Blank EXHIBIT J: DOCUMENTATION * Confidential treatment requested. Source: ADVANCED MICRO DEVIC, 10-K, March...

  • Page 278
    ... Technology Objectives *** Technology Implementation Options The *** technology may include the following features if needed and technically feasible: *** *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10...

  • Page 279
    ... Technology Objectives *** Technology Implementation Options The *** technology may include the following features if needed and technically feasible: *** *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10...

  • Page 280
    ... Technology Objectives *** Technology Implementation Options The *** technology may include the following features if needed and technically feasible: *** *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10...

  • Page 281
    ... Technology Objectives *** Technology Implementation Options The *** technology may include the following features, if needed and technically feasible: *** *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10...

  • Page 282
    ... Technology Objectives *** Technology Implementation Options The *** technology may include the following features if needed and technically feasible: *** *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10...

  • Page 283
    ... demonstration on an integrated process Test Site T2: meets functional requirements for an SOI Integrated Circuit product (not Test Site) *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 284
    ... are expected to be productive immediately and should have enough experience in the given technology area to work independently and lead sub teams. *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10-K, March 14...

  • Page 285
    ...avoidance of doubt, until ***, no compensation pursuant to Section 4.3 shall be required for failure to meet the minimum staffing requirements. *** Confidential information omitted and filed separately with the Securities and Exchange Commission. Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 286
    ... of the Management Committee All other responsibilities, including day-to-day management responsibility for the results to be achieved under the Agreement, shall reside with the IBM Project Leader with the help of the AMD Deputy Project Leader. Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 287
    ... for managing the IBM infrastructure to support the Project Activities - Responsible for Project schedule planning - Responsible for management of IBM Personnel - Responsible for completion of Documentation for each Process Development Projects Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 288
    ... for quarterly reports (technology status, milestones) - Responsible for review and approval of technical publications - Responsible for management of respective Party's personnel - Responsible for completion of Documentation for each Process Development Projects Source: ADVANCED MICRO DEVIC, 10...

  • Page 289
    ... doors propped open. No IBM materials shall be removed from buildings without prior written approval. Alcoholic beverages, illegal drugs, guns and ammunition, cameras, and recording devices are not permitted on IBM premises. 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 Source: ADVANCED MICRO DEVIC, 10...

  • Page 290
    EXHIBITS G, H and I LEFT INTENTIONALLY BLANK Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 291
    ...for critical materials Defect Catalog SOI Wafer Specification Bill Of Materials For wafers SIMS data (as available) Device design and modeling: - SOI device model - Parameter extraction - AC Performance Verification - Tolerance data - Compact model Source: ADVANCED MICRO DEVIC, 10-K, March 14, 2003

  • Page 292
    ... Functional test Burn-In/reliability T2 Product Characterization data for SOI Integrated Circuit product (dependent on availability of common IBM / AMD product) Lithography Documentation - Mask fabrication specifications - Mask data processing sequence including OPC/PPC Source: ADVANCED MICRO DEVIC...

  • Page 293
    ... may access information available during the Process Development Projects and document such information for the purpose of transferring such information to its own manufacturing facilities. All such documentation shall be made available to all three (3) Parties. Source: ADVANCED MICRO DEVIC, 10...

  • Page 294
    ... Company & Co. KG (8) AMD Saxony Admin GmbH (3) AMD Foreign Sales Corporation Advanced Micro Devices S.p.A. AMD Japan Ltd. Advanced Micro Devices Sdn. Bhd. Advanced Micro Devices Export Sdn. Bhd. (4) AMD (Netherlands) B.V. (5) Advanced Micro Devices (Singapore) Pte. Ltd. AMD Holdings (Singapore) Pte...

  • Page 295
    ...-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign Advanced Micro Devices, Inc.'s Annual Report on Form 10-K for the fiscal year ended December 29, 2002, and any and all amendments thereto, and to file...