Crucial 2015 Annual Report Download - page 73

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We are unable to predict the outcome of the matter and therefore cannot estimate the range of possible loss. The final
resolution of this lawsuit could result in the loss of the Inotera Shares or monetary damages, unspecified damages based on the
benefits derived by Micron B.V. from the ownership of the Inotera Shares, and/or the termination of the patent cross-license,
which could have a material adverse effect on our business, results of operation, or financial condition. As of September 3,
2015, the Inotera Shares had a carrying value in equity method investments for purposes of our financial reporting of $683
million and a market value of $846 million.
Other
In the normal course of business, we are a party to a variety of agreements pursuant to which we may be obligated to
indemnify the other party. It is not possible to predict the maximum potential amount of future payments under these types of
agreements due to the conditional nature of our obligations and the unique facts and circumstances involved in each particular
agreement. Historically, our payments under these types of agreements have not had a material adverse effect on our business,
results of operations, or financial condition.
Redeemable Convertible Notes
Under the terms of the indentures governing the 2033 Notes, upon conversion, we would be required to pay cash equal to
the lesser amount of (1) the aggregate principal amount or (2) the conversion value of the notes being converted. To the extent
the conversion value exceeds the principal amount, we could pay cash, shares of common stock, or a combination thereof, at
our option, for the amount of such excess. The 2033 Notes were convertible at the option of the holders as of September 3,
2015 and August 28, 2014. Therefore, the 2033 Notes were classified as current debt and the aggregate difference between the
principal amount and the carrying value of $49 million as of September 3, 2015 and $68 million as of August 28, 2014 was
classified as redeemable convertible notes in the accompanying consolidated balance sheets. (See "Debt" note.)
Equity
Micron Shareholders' Equity
Common Stock Repurchases: Since the first quarter of 2015, our Board of Directors has authorized the repurchase of up
to $1.25 billion of our outstanding common stock, $250 million of which was authorized in the first quarter of 2016. Any
repurchases under the authorization may be made in open market purchases, block trades, privately-negotiated transactions,
and/or derivative transactions. Repurchases are subject to market conditions and our ongoing determination of the best use of
available cash. During 2015, we repurchased 42 million shares for $831 million (including commissions) through open market
transactions, which were recorded as treasury stock.
Capped Calls
Issued and Outstanding Capped Calls: We have entered into capped calls, which are intended to reduce the effect of
potential dilution from our convertible notes. The capped calls provide for our receipt of cash or shares, at our election, from
our counterparties if the trading price of our stock is above a specified initial strike price at the expiration dates. The amounts
receivable varies based on the trading price of our stock, up to specified cap prices. The dollar value of the cash or shares that
we would receive from the capped calls upon their expiration date ranges from $0 if the trading price of our stock is below the
initial strike price for all of the capped calls to $814 million if the trading price of our stock is at or above the cap price for all
of the capped calls. We paid $57 million in 2011 to purchase the 2031 Capped Calls, $103 million in 2012 to purchase the
2032 Capped Calls and $48 million in 2013 to purchase the 2033 Capped Calls. The amounts paid were recorded as charges to
additional capital.