This excerpt taken from the SNDK 10-K filed Mar 15, 2006.
Off Balance Sheet Liabilities
FlashVision. FlashVision secured an equipment lease arrangement of approximately 37.9 billion Japanese yen, or approximately $321 million based upon the exchange rate at January 1, 2006, in May 2002 with Mizuho Leasing, and other financial institutions. Under the terms of the lease, Toshiba guaranteed these commitments on behalf of FlashVision. The Company agreed to indemnify Toshiba for certain liabilities Toshiba incurs as a result of Toshibas guarantee of the FlashVision equipment lease arrangement. If FlashVision fails to meet its lease commitments, and Toshiba fulfills these commitments under the terms of Toshibas guarantee, then the Company will be obligated to reimburse Toshiba for 49.9% of any claims and associated expenses under the lease, unless the claims result from Toshibas failure to meet its obligations to FlashVision or its covenants to the lenders. Because FlashVisions equipment lease arrangement is denominated in Japanese yen, the maximum amount of the Companys contingent indemnification obligation on a given date when converted to U.S. dollars will fluctuate based on the exchange rate in effect on that date. As of January 1, 2006, the maximum amount of the Companys contingent indemnification obligation, which reflects payments and any lease adjustments, was approximately 8.8 billion Japanese yen, or approximately $75 million based upon the exchange rate at January 1, 2006.
Flash Partners. As described in Commitments Flash Partners above, Flash Partners intends to sell and lease-back from a consortium of financial institutions a portion of its tools and has entered into two equipment lease agreements as described below.
Notes to Consolidated Financial Statements (Continued)
In addition, Flash Partners expects to secure additional equipment lease facilities over time.