Crucial 2015 Annual Report Download - page 17

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A determination that our products or manufacturing processes infringe the intellectual property rights of others or
entering into a license agreement covering such intellectual property could materially adversely affect our business,
results of operations, or financial condition.
As is typical in the semiconductor and other high technology industries, from time to time others have asserted, and may in
the future assert, that our products or manufacturing processes infringe their intellectual property rights. We are unable to
predict the outcome of assertions of infringement made against us. A determination that our products or manufacturing
processes infringe the intellectual property rights of others, or entering a license agreement covering such intellectual property,
could result in significant liability and/or require us to make material changes to our products and/or manufacturing processes.
Any of the foregoing results could have a material adverse effect on our business, results of operations, or financial condition.
(See "Part II. Financial Information – Item 8. Financial Statements – Notes to Consolidated Financial Statements –
Contingencies.")
We have a number of intellectual property license agreements. Some of these license agreements require us to make one
time or periodic payments. We may need to obtain additional patent licenses or renew existing license agreements in the future.
We are unable to predict whether these license agreements can be obtained or renewed on acceptable terms.
Our joint ventures and strategic relationships involve numerous risks.
We have entered into strategic relationships to manufacture products and develop new manufacturing process technologies
and products. These relationships include our IMFT joint venture with Intel, our Inotera joint venture with Nanya, and our MP
Mask joint venture with Photronics. These joint ventures and strategic relationships are subject to various risks that could
adversely affect the value of our investments and our results of operations. These risks include the following:
• our interests could diverge from our partners or we may not be able to agree with partners on ongoing manufacturing
and operational activities, or on the amount, timing, or nature of further investments in our joint venture;
• our joint venture partners' products may compete with our products;
• we may experience difficulties in transferring technology to joint ventures;
• we may experience difficulties and delays in ramping production at joint ventures;
• our control over the operations of our joint ventures is limited;
• we may recognize losses from our equity method investments;
• due to financial constraints, our joint venture partners may be unable to meet their commitments to us or our joint
ventures and may pose credit risks for our transactions with them;
• due to differing business models or long-term business goals, our partners may decide not to join us in funding capital
investment in our joint ventures, which may result in higher levels of cash expenditures by us;
• cash flows may be inadequate to fund increased capital requirements;
• we may experience difficulties or delays in collecting amounts due to us from our joint ventures and partners;
• the terms of our partnering arrangements may turn out to be unfavorable; and
• changes in tax, legal, or regulatory requirements may necessitate changes in the agreements with our partners.
If our joint ventures and strategic relationships are unsuccessful, our business, results of operations, or financial condition
may be materially adversely affected.
If our manufacturing process is disrupted, our business, results of operations, or financial condition could be materially
adversely affected.
We manufacture products using highly complex processes that require technologically advanced equipment and continuous
modification to improve yields and performance. Difficulties in the manufacturing process or the effects from a shift in product
mix can reduce yields or disrupt production and may increase our per gigabit manufacturing costs. We maintain operations and
continuously implement new product and process technology at our manufacturing operations which are widely dispersed in
multiple locations in several countries including the U.S., Singapore, Taiwan, Japan, Malaysia, and China. Additionally, our
control over operations at IMFT, Inotera, MP Mask, and Tera Probe is limited by our agreements with our partners. From time
to time, we have experienced disruptions in our manufacturing process as a result of power outages, improperly functioning
equipment, equipment failures, earthquakes, or other environmental events. If production at a fabrication facility is disrupted
for any reason, manufacturing yields may be adversely affected or we may be unable to meet our customers' requirements and
they may purchase products from other suppliers. This could result in a significant increase in manufacturing costs, loss of
revenues, or damage to customer relationships, any of which could materially adversely affect our business, results of
operations, or financial condition.