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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Paul Engel who wrote (35411)	8/2/1998 2:02:00 AM
From: JBoyd	Read Replies (1) \| Respond to of 1573727

Dresden Question Does the $1.9 billion cost of Dresden include equipment? If not, how much will that add to the bill? AMD Saxony is building Dresden Fab 30, a 900,000-square-foot submicron integrated circuit manufacturing and design facility over the next four years at a present estimated cost of approximately $1.9 billion. The Federal Republic of Germany and the State of Saxony have agreed to support the project in the form of (i) a guarantee of 65 percent of the bank debt to be incurred by AMD Saxony up to a maximum of DM1.65 billion, (ii) investment grants and subsidies totaling DM501 million and (iii) interest subsidies from the State of Saxony totaling DM300 million. In March 1997, AMD Saxony entered into the Dresden Loan Agreement under which loan facilities totaling DM1.65 billion will be made available. In connection with the Dresden Loan Agreement, the Company has agreed to invest in AMD Saxony over the next two years equity or subordinated loans in an amount totaling approximately DM478 million, and to guarantee a portion of AMD Saxony's obligations under the Dresden Loan Agreement up to a maximum of DM218 million until Dresden Fab 30 has been completed. After completion of Dresden Fab 30, the Company has agreed to make funds available to AMD Saxony up to DM145 million if the subsidiary does not meet its fixed charge coverage ratio covenant. The Company has agreed to fund certain contingent obligations, including various obligations to fund project cost overruns, if any. The Company commenced construction in the second quarter of 1997 and completed construction of the building shell for the plant and administration building at the end of 1997. The planned Dresden Fab 30 costs are denominated in deutsche marks and, therefore, are subject to change due to foreign exchange rate fluctuations. The Company entered into foreign currency hedging transactions for Dresden Fab 30 during the first quarter of 1997.