AMD 2004 Annual Report Download - page 219

basis, including certain types of package research and development, module and integration research and development, and various administrative functions, such
as payroll, IT, legal, financial reporting and tax. The Company may also engage third party contractors in its discretion.
8.6.2Contract Terms. Without limiting Sections 7.7 and 7.8:
(a) the terms of any contract, agreement or arrangement into which the Company enters will be determined between the Company and the
respective counter-party(ies);
(b) the terms of any contract, agreement or arrangement between any Company Entity, on the one hand, and any other Company Entity, a
Member, or any Affiliate of a Member, on the other hand, shall be on an arm’s length basis;
(c) any contracts, agreements or arrangements between (i) any Company Entity and AMD or an Affiliate of AMD on the one hand, and (ii)
any Company Entity and Fujitsu or an Affiliate of Fujitsu on the other hand, that are of a similar nature shall be on substantially similar terms, unless there is a
reasonable commercial basis for any difference, such as differing purchase volumes or other reasonable commercial differences; and
(d) in no event shall any counter-party to a contract, agreement or arrangement be permitted to enter into contracts, agreements or
arrangements on behalf of, or otherwise legally bind or act in a manner that is legally binding on, the Company.
(e) any contracts, agreements or arrangements between any Company Entity, on the one hand, and AMD or an Affiliate of AMD or Fujitsu
or an Affiliate of Fujitsu, on the other hand, or any amendment, supplement or other modification thereof or thereto, shall in each case be subject to the approval
of the Board of Managers.
8.7 Access to Company Facilities
AMD or Fujitsu may gain access to the Company’s facilities and assets (and the Company shall cause the other Company Entities to provide such
access) in the course of their businesses, on a case-by-case basis, subject to arrangement with the Company and approval by the Board of Managers and subject
to Section 7.19.
8.8 Inventory
An appropriately designated employee of the Company shall have responsibility for managing the Company’s inventory and shall manage such
inventory in a manner that is consistent with prudent business operations and cash management. Notwithstanding anything to the contrary in the foregoing, the
Company’s overall target unit inventory will be the amount of product in the process of being manufactured and the amount of finished product (including
products consigned to a distributor) which have an aggregate value determined in accordance with the Company’s standard accounting practices that does not
exceed the aggregate manufacturing cost determined in accordance with the Company’s standard accounting practices of products set forth in the Company’s
written product forecasts, taking into account the
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Confidential treatment has been requested for portions of this exhibit. The copy filed herewith omits the information subject to the confidentiality request.
Omissions are designated as ****. A complete version of the exhibit has been filed separately with the Securities and Exchange Commission.
Source: ADVANCED MICRO DEVIC, 10-K, March 01, 2005