Intel 2007 Annual Report Download - page 49

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Table of Contents
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATION (Continued)
Contractual obligations that are contingent upon the achievement of certain milestones are not included in the table above.
These obligations include milestone-based co-marketing agreements, contingent funding/payment obligations, and milestone-
based equity investment funding. These arrangements are not considered contractual obligations until the milestone is met by
the third party. As of December 29, 2007, assuming that all future milestones are met, additional required payments would be
approximately $254 million.
For the majority of restricted stock units granted, the number of shares issued on the date the restricted stock units vest is net
of the statutory withholding requirements that are paid by Intel on behalf of our employees. The obligation to pay the relative
taxing authority is not included in the table above, as the amount is contingent upon continued employment. In addition, the
amount of the obligation is unknown, as it is based in part on the market price of our common stock when the awards vest.
The expected timing of payments of the obligations above are estimates based on current information. Timing of payments and
actual amounts paid may be different, depending on the time of receipt of goods or services, or changes to
agreed-upon amounts for some obligations. Amounts disclosed as contingent or milestone-based obligations are dependent on
the achievement of the milestones or the occurrence of the contingent events and can vary significantly.
We have a contractual obligation to purchase the output of IMFT and IMFS in proportion to our investments, currently 49% in
each of these ventures. However, IMFS is in its construction phase and has had no production to date. See “Note 19:
Ventures” in Part II, Item 8 of this Form 10-K.
Additionally, we have entered into various contractual commitments in relation
to our investments in IMFT and IMFS. Some of these commitments are with Micron, and some are directly with IMFT or
IMFS. The following are the significant contractual commitments:
Off-Balance-Sheet Arrangements
As of December 29, 2007, we did not have any significant off-balance-sheet arrangements, as defined in Item 303(a)(4)(ii) of
SEC Regulation S-K.
42
• Subject to certain conditions, Intel and Micron each agreed to contribute up to approximately $1.4 billion for IMFT
and up to approximately $1.7 billion for IMFS in the three years following the initial capital contributions. Of these
amounts, as of December 29, 2007, our remaining commitments were approximately $260 million for IMFT and
approximately $1.5 billion for IMFS.
• We also have several agreements with Micron related to intellectual property rights, and R&D funding related to
NAND flash manufacturing and IMFT. See
“
Note 19: Ventures
”
in Part II, Item 8 of this
Form 10
-
K.