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Item 1.01 Entry into a Material Definitive Agreement
Amended and Restated Seventh Amendment to the Wafer Supply Agreement
On May 13, 2021, Advanced Micro Devices, Inc. (the “Company”) entered into an amended seventh amendment (the “A&R Seventh Amendment”) to the Wafer Supply Agreement with GLOBALFOUNDRIES Inc. (“GF”) to extend GF’s capacity commitment and wafer pricing to the
Company under the backdrop of the current global supply environment. The terms of the previous seventh amendment to the Wafer Supply Agreement required the parties to mutually agree on annual wafer purchase targets and wafer pricing beyond 2021.
The A&R Seventh Amendment modifies certain terms of the Wafer Supply Agreement applicable to wafer purchases at the 12 nm and 14 nm technology nodes by the Company for the period commencing on May 12, 2021 and continuing through December 31, 2024. Specifically, GF agreed to a minimum annual capacity allocation to the Company for years 2022, 2023 and 2024. The A&R Seventh Amendment also removes
all prior exclusivity commitments and provides the Company with full flexibility to contract with any wafer foundry with respect to all products manufactured at any technology node.
Further, the Company and GF agreed to pricing and new annual wafer purchase targets for years 2022, 2023 and 2024, and the Company agreed to pre-pay GF certain amounts for those wafers in 2022 and 2023. If the Company does not meet the annual wafer purchase target for any of these years, the
Company will be required to pay to GF a portion of the difference between the actual wafer purchases and the wafer purchase target for that year. The Company currently estimates that it will purchase approximately $1.6 billion of wafers from GF for years 2022 to 2024 under the A&R Seventh Amendment.
The foregoing description is not complete and is qualified in its entirety by reference to the A&R Seventh Amendment, a copy of which will be filed with a Quarterly Report on Form 10-Q.
SIGNATURES
Pursuant
to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
