AMD 2005 Annual Report Download - page 96

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Table of Contents
following tables present the significant transactions and account balances between the Company and Fujitsu for the years ended December 25, 2005 and
December 26, 2004 and for the six months ended December 28, 2003 and the balances receivable from or payable to Fujitsu at December 26, 2004:
Year Ended
Six months ended
December 28,
2003
December 25,
2005(1)
December 26,
2004
(In thousands)
Net sales to Fujitsu(2) $ 875,169 $ 1,077,096 $ 448,940
Commercial die purchases from Fujitsu 93,102 141,117 41,332
Subcontract manufacturing purchases from Fujitsu 34,765 74,800 54,787
Other purchases of goods and services from Fujitsu and
rental expense to Fujitsu 68,284 66,525 29,605
Distributor commissions due to Fujitsu 42,975 67,996 29,706
Service fees due to Fujitsu 19,882 33,493 21,261
Royalty fees due to Fujitsu 13,634 18,080 8,672
(1) Reflects transactions through December 20, 2005.
(2) Includes net sales of both Flash memory products and microprocessors to Fujitsu.
As of
December 26,
2004
(In thousands)
Accounts receivable from Fujitsu $ 172,871
Accounts payable to Fujitsu 18,894
Accrued royalties payable to Fujitsu 8,180
Notes payable to Fujitsu 40,000
The royalty expense due to Fujitsu represents the payments from Spansion LLC for its use of Fujitsu’s intellectual property. The distributor commission
expense due to Fujitsu represents the compensation that Spansion LLC paid to Fujitsu in connection with Fujitsu’s distribution of Spansion Flash memory
products.
The Company’s transactions with Fujitsu were based on terms that are consistent with those of similar arms-length transactions executed with third parties.
Subsequent to December 20, 2005
On December 21, 2005, Spansion became an unconsolidated equity investee of the Company. There were no significant transactions between the
Company and Spansion relating to service agreements during the five day period, December 21 to December 25, 2005. The following table represents the
significant account balances receivable from or payable to Spansion at December 25, 2005:
As of
December 25,
2005
(In thousands)
Other receivable from Spansion $ 121,585
Notes receivable from Spansion 25,008
Accounts payable to Spansion 233,224
In connection with the IPO, the Company entered into various amended and restated service agreements, a non-compete agreement and a patent
cross-license agreement with Spansion. Under the amended services agreement, the Company will continue to provide, among other things, information
technology, facilities,
91
Source: ADVANCED MICRO DEVIC, 10-K, February 27, 2006