AMD 2012 Annual Report Download - page 31

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In the fourth quarter of 2012, we implemented a restructuring plan designed to improve our cost structure
and to strengthen our competitiveness in core growth areas. The plan primarily involves a workforce reduction of
approximately 14% as well as asset impairments and facility consolidations. If we do not manage these
headcount reductions effectively, our ability to implement our new business strategy could be adversely
impacted.
We have a substantial amount of indebtedness which could adversely affect our financial position and prevent
us from implementing our strategy or fulfilling our contractual obligations.
Our debt and capital lease obligations as of December 29, 2012 were $2.0 billion, which reflects the debt
discount adjustment on our 6.00% Convertible Senior Notes due 2015 (6.00% Notes) and our 8.125% Senior
Notes due 2017 (8.125% Notes).
Our substantial indebtedness may:
• make it difficult for us to satisfy our financial obligations, including making scheduled principal and
interest payments;
• limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions and
general corporate and other purposes;
• 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 us to use a substantial portion of our cash flow from operations to make debt service payments;
• place us at a competitive disadvantage compared to our less leveraged competitors; and
• increase our vulnerability to the impact of adverse economic and industry conditions.
We may not be able to generate sufficient cash to service our debt obligations.
Our ability to make payments on and to refinance our debt will depend on our financial and operating
performance, which may fluctuate significantly from quarter to quarter, and is subject to prevailing economic
conditions and financial, business and other factors, many of which are beyond our control. We cannot assure
you that we will be able to generate sufficient cash flow or that we will be able to borrow funds in amounts
sufficient to enable us to service our debt or to meet our working capital requirements. If we are not able to
generate sufficient cash flow from operations or to borrow sufficient funds to service our debt, we may be
required to sell assets or equity, reduce expenditures, refinance all or a portion of our existing debt or obtain
additional financing. We cannot assure you that we will be able to refinance our debt, sell assets or equity or
borrow more funds on terms acceptable to us, if at all.
Our debt instruments impose restrictions on us that may adversely affect our ability to operate our business.
The indentures governing our 8.125% Notes, 7.75% Senior Notes due 2020 (7.75% Notes) and 7.50%
Senior Notes due 2022 (7.50% Notes) contain various covenants which limit our ability to:
• incur additional indebtedness;
• pay dividends and make other restricted payments;
• make certain investments, including investments in our unrestricted subsidiaries;
• create or permit certain liens;
• create or permit restrictions on the ability of certain restricted subsidiaries to pay dividends or make
other distributions to us;
• use the proceeds from sales of assets;
23