Note 13 — Related Party Transactions
A member of the Company’s board of directors is also a member of the board of directors of
Seagate Technology (“Seagate”). The Company sells semiconductors used in storage product
applications to Seagate for prices comparable to those charged to an unrelated third party.
Revenues from sales by the Company to Seagate were $118.9 million and $217.5 million for the three
and six months ended July 3, 2011, respectively. Revenues from sales by the Company to Seagate were
$88.8 million and $184.9 million for the three and six months ended July 4, 2010, respectively. The
Company had accounts receivable from Seagate of $71.7 million and $55.0 million as of July 3, 2011
and December 31, 2010, respectively.
The Company has an equity interest in a joint venture, Silicon Manufacturing Partners Pte Ltd.
(“SMP”), with GLOBALFOUNDRIES, a manufacturing foundry for integrated circuits. SMP operates an
integrated circuit manufacturing facility in Singapore. The Company owns a 51% equity interest in
this joint venture and accounts for its ownership position under the equity method of accounting.
The Company is effectively precluded from unilaterally taking any significant action in the
management of SMP due to GLOBALFOUNDRIES’ significant participatory rights under the joint venture
agreement. Because of GLOBALFOUNDRIES’ approval rights, the Company cannot make any significant
decisions regarding SMP without GLOBALFOUNDRIES’ approval, despite the 51% equity interest. In
addition, the General Manager, who is responsible for the day-to-day management of SMP, is
appointed by GLOBALFOUNDRIES, and GLOBALFOUNDRIES provides day-to-day operational support to SMP.
The Company purchased $14.8 million and $25.6 million of inventory from SMP for the three and
six months ended July 3, 2011, respectively. The Company purchased $12.0 million and $24.0 million
of inventory from SMP for the three and six months ended July 4, 2010, respectively. As of July 3,
2011 and December 31, 2010, the amounts payable to SMP were $6.9 million and $1.2 million,