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Technology Stocks : Apple Inc.

AAPL 259.35

+0.1%

Jan 9 3:59 PM EST

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To: billcasto who wrote (60014)	12/31/2006 11:26:26 PM
From: aaplfan	Read Replies (1) of 213182

What was all the prepaid Nand expenses about? Apple announced a deal in 2005 that they had entered into long-term supply agreements with several NAND mfrs for which they would prepay $1.25 billion. If I recall correctly, the amount of the prepayment was made public but the terms (other than Apple committing to certain minimum levels of purchase) were not. Most likely, it guaranteed Apple a percentage of supply from each of the mfrs at a very favorable price for the duration of the agreement. In return, the companies they prepaid got capital to expand capacity to meet the terms of the agreement (just a WAG on my part re: what the money was for.) Here's a link to the press release: apple.com

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