AMD 2006 Annual Report Download - page 24

Table of Contents
assignment for the benefit of creditors, the institution of any proceedings for the liquidation or winding up of the other party’s business, or in the event of a
change of control. For purposes of our agreement with Intel, change of control means a transaction or a series of related transactions in which (i) one or more
related parties who did not previously own at least a 50 percent interest in a party obtain at least a 50 percent interest in such party, and, in the reasonable
business judgment of the other party, such change in ownership will have a material effect on the other party’s business, or (ii) a party acquires, by merger,
acquisition of assets or otherwise, all or any portion of another legal entity such that either the assets or market value of such party after the close of such
transaction are greater than one and one third of the assets or market value of such party prior to such transaction.
Backlog
We manufacture and sell standard lines of products. Consequently, a significant portion of our sales are made from inventory on a current basis. Sales are
made primarily pursuant to purchase orders for current delivery or agreements covering purchases over a period of time. These orders or agreements may be
revised or canceled without penalty. Generally, in light of current industry practice and experience and the fact that substantially our entire order backlog is
cancelable, we do not believe that such agreements provide meaningful backlog figures or are necessarily indicative of actual sales for any succeeding period.
Employees
As of December 31, 2006, we had approximately 16,500 employees.
Environmental Regulations
Many aspects of our business operations and products are regulated by domestic and international environmental laws and regulations. These regulations
include limitations on discharge of pollutants to air, water, and soil; remediation requirements; product chemical content limitations; manufacturing chemical use
and handling restrictions; pollution control requirements; waste minimization considerations; and requirements with respect to treatment, transport, storage and
disposal of solid and hazardous wastes. If we fail to comply with any of the applicable environmental regulations we may be subject to fines, suspension of
production, alteration of our manufacturing processes, import/export restrictions, sales limitations, and/or criminal and civil liabilities. Existing or future
regulations could require us to procure expensive pollution abatement or remediation equipment; to modify product designs; or to incur other expenses to comply
with environmental regulations. Any failure to adequately control the use, disposal or storage, or discharge of hazardous substances could expose us to future
liabilities that could have a material adverse effect on our business. We believe we are in material compliance with applicable environmental requirements and do
not expect those requirements to result in material expenditures in the foreseeable future.
Environmental laws are complex, change frequently and have tended to become more stringent over time. For example, the European Union and China are
two among a growing number of jurisdictions that have enacted in recent years restrictions on the use of lead, among other chemicals, in electronic products.
These regulations affect semiconductor packaging. Other regulatory requirements potentially affecting our manufacturing processes and the design and
marketing of our products are in development throughout the world. While we have budgeted for foreseeable associated expenditures, we cannot assure you that
future environmental legal requirements will not become more stringent or costly in the future. Therefore, we cannot assure you that our costs of complying with
current and future environmental and health and safety laws, and our liabilities arising from past and future releases of, or exposure to, hazardous substances will
not have a material adverse effect on us.
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Source: ADVANCED MICRO DEVIC, 10-K, March 01, 2007