Intel 2005 Annual Report Download - page 27

Table of Contents
ITEM 1B. UNRESOLVED STAFF COMMENTS
Not applicable.
At December 31, 2005, our major facilities consisted of:
Our principal executive offices are located in the U.S. The majority of our wafer fabrication and research and development activities are also located at
sites within the U.S. Outside of the U.S., we have wafer fabrication at our facilities in Ireland and Israel. The majority of our assembly and test
facilities are located overseas, specifically in Malaysia, China, the Philippines and Costa Rica. In addition, we have sales and marketing offices located
worldwide. These facilities are generally located near major concentrations of users.
We believe that our existing facilities are suitable and adequate for our present purposes and that the productive capacity in such facilities is
substantially being utilized or we have plans to utilize it.
We do not identify or allocate assets by operating segment. For information on net property, plant and equipment by country, see “Note 19: Operating
Segment and Geographic Information” in Part II, Item 8 of this Form 10-K.
A. Tax Matters
In connection with the IRS’s regular examination of Intel’s tax returns for the years 1999 and 2000, the IRS formally assessed in early 2005 certain
adjustments to the amounts reflected by us on those returns as a tax benefit for export sales. Also in 2005, the IRS formally assessed similar
adjustments to the amounts reflected by us for the years 2001 and 2002 as a tax benefit for export sales. We do not agree with these adjustments and
have appealed the assessments. If the IRS prevails in its position, our federal income tax due for 1999 through 2002 would increase by approximately
$1.0 billion, plus interest. The IRS may make similar claims for years subsequent to 2002 in future audits, and if the IRS prevails, income tax due for
2003 through 2005 would increase by approximately $1.2 billion, plus interest.
Although the final resolution of the adjustments is uncertain, based on currently available information, management believes that the ultimate outcome
will not have a material adverse effect on our financial position, cash flows or overall trends in results of operations. There is the possibility of a
material adverse impact on the results of operations of the period in which the matter is ultimately resolved, if it is resolved unfavorably, or in the
period in which an unfavorable outcome becomes probable and reasonably estimable.
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ITEM 2.
PROPERTIES
(Square Feet in Millions)
United States
Other Countries
Total
Owned facilities
1
27.0
12.9
39.9
Leased facilities
2
2.4
3.2
5.6
Total facilities
29.4
16.1
45.5
1
Leases on portions of the land used for these facilities expire at varying dates through 2059.
2
These leases expire at varying dates through 2021 and generally include renewals at our option.
ITEM 3.
LEGAL PROCEEDINGS