SAB/DRESDNER SUBSIDY AGREEMENT

EXHIBIT - 10.50(d)

ADVANCED MICRO DEVICES, INC.

SECRETARY'S CERTIFICATE

The undersigned, Thomas M. McCoy, certifies that he is the Secretary of
Advanced Micro Devices, Inc., a Delaware Corporation ("the Company"), and that,
as such, he is authorized to execute this Certificate on behalf of the Company,
and further certifies that the attached is a fair and accurate translation of
the Subsidy Agreement between AMD Saxony Manufacturing GmbH and Sachsische
Aufbaubank.

WITNESS the signature of the undersigned this 13th day of May, 1997.


/s/ Thomas M. McCoy
-------------------------------
Thomas M. McCoy
Secretary

[SEAL APPEARS HERE]




--The german version will be binding--

Sachsische Aufbaubank

COMMITMENT LETTER

Dresdner Bank AG Dresden, February 12, 1997
in Dresden M 1/Herr Zweckl-ro
Postfach 12 07 17 Tel.: (0351) 49 10 - 47 00

01008 Dresden

Customer no.: 262-206553
Project no.: 2514-7943

REGIONAL ECONOMIC DEVELOPMENT PROGRAMME OF THE FREE STATE OF SAXONY

Re: Application dated October 2, 1995 and Subsidy agreement dated
December 18, 1995 in the form of July 24, 1996

Grant recipient: AMD Saxony Manufacturing GmbH, 01067 Dresden


Ladies and Gentlemen,

based on the approval by the State Ministry of Saxony for Economic and Labour
Affairs of the above application, the Sachsische Aufbaubank is committing by way
of amending the Subsidy agreement dated December 18, 1995 in the form of July
24, 1996 an appropriated investment grant to you in the amount of

DM 476,687,000.00

in words:

DM four hundred seventy six million six hundred eighty-seven thousand

from funds of the Common Action (CA) "Regional Economic Structural Improvement"
(CA funds) for onward transmission to the above mentioned grant recipient.

The grant will be made available in instalments as follows:


EFRD funds
CA Funds EC/Federal Government/
Federal State Federal State
- --------------------------------------------------------------------------------
Account no. 972.003990.2
1997 an amount of up to DM 138,000,000.00

Account no. 972.003968.9
1998 an amount of up to DM 163,000,000.00

Account no. 972.004257.3
1999 an amount of up to DM 175,687,000.00



In calculating the amount of the investment grant a total grant-in-aid of DM
500,500,000.00 has been assumed, consisting of an investment allowance of DM
23,813,000.00 and an investment grant of DM 476,687,000.00 million. If the
investment allowance is increased or reduced, the amount of the investment grant
will be adjusted accordingly.

GRANTING OF AN INTEREST GRANT FROM BUDGET FUNDS OF THE FREE STATE OF SAXONY

Based on the approval by the State Ministry for Economics and Labour Affairs,
the Sachsische Aufbaubank is committing in particularization of the Subsidy
agreement dated July 24, 1996 an interest grant in the amount of

DM 300,000,000.00
in words:
DM three hundred million

for onward transmission to the grant recipient mentioned above.

It is assumed that the interest grant will become due as follows:

1997 8,800,000.00 DM
1998 31,000,000.00 DM
1999 59,300,000.00 DM
2000 84,300,000.00 DM
2001 96,800,000.00 DM
2002 19,800,000.00 DM

The interest grant is to be used solely for the guaranteed loan in the amount of
up to DM 1,650,000,000.00 to be extended for the financing of the project. The
interest grant will be made available in instalments by the Sachsische
Aufbaubank upon presentation of interest calculations by the principal bank.

For both grants the following conditions shall apply:

PURPOSE OF THE GRANTS

The grants have been appropriated for a specific purpose and must be used for
cofinancing the costs of the project

"Construction of a manufacturing facility for the production of
microelectronics products at the investment site 01067 Dresden".

--The german version will be binding--

INVESTMENT PERIOD

The project shall be carried out BETWEEN MARCH 31, 1996 AND DECEMBER 31, 2006.

The project consists of two phases:

Phase 1: March 31, 1996 to December 31, 2001
and
Phase 2: January 1, 2002 to December 31, 2006.


INVESTMENT AND FINANCIAL PLAN

The basis for the provision of the grants is the following investment and
financial plan.

in accordance with
commitment letter
dated Dec. 18,
1995

INVESTMENT PLAN -old- -new-

DM DM**
- ----------------------------------------------------------------------------
Purchase of real estate [

Wafer plant

- - Buildings and infrastructure**
- - Plant and equipment

Development centre *

- - Buildings and infrastructure
- - Plant and equipment


Start-up expenditure
]

**According to the AMD Plan dated Sept. 1996

* CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.

-old- -new-

FINANCIAL PLAN DM DM
- -------------------------------------------------------------------------------
Contribution of equity funds by [
AMD/USA (share capital/shareholder
loans

Contribution of funds sourced from
the cash flow of the grant recipient
from 2001 onwards *

Investment allowance

Investment grant from CA funds

Loan provided by the principal bank

]


NOTES ON THE CALCULATION OF THE PUBLIC FINANCIAL ASSISTANCE:

The calculation of the CA grant is based on maximum costs eligible for
assistance in the amount of DM 1,430,000,000.00. This amounts corresponds to
maximum total investment eligible for assistance of DM 1,000,000.00 per
permanent job created.

It has to be noted, that the cost eligible for assistance actually incurred may
be subsidized by grants and other public financial aid up to a maximum rate of
35%.

The interest grant has been calculated on the basis of a loan requirement from
the principal bank in the amount of up to DM 1,650,000,000.00. This additional
grant is designed to off-set the interest expenses of the grant recipient during
the investment phase up to the year 2002 and thereafter, if the interest grant
has not been fully used.


JOBS

The calculation of the public financial assistance is based on the assumption
that through the investment at least 1,430 permanent jobs will be created, which
will be filled in full by the end of the year 2001. The grant recipient is not
obliged to create special jobs for women.

* CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.


--The german version will be binding--

With regard to the reporting requirements concerning the creation and filing of
the permanent jobs we, in addition, refer to Clause 6 of the General Conditions
as well as to the repayment provisions according to Clause 7 of the General
Conditions.


DRAWDOWN OF FUNDS FROM THE COMMON ACTION "REGIONAL ECONOMIC STRUCTURAL
IMPROVEMENT"

The grant may be drawn down on January 30, April 30, July 30 and October 30 of
each year upon fulfillment of the following drawdown requirements by making use
of the attached notice of drawdown forms (Appendix 5):

- - The overall financing of the project has been secured.

- - Before the first drawdown the grant recipient has received equity and
shareholder loans amounting to DM 143,000,000.00 and cost eligible for
assistance in the amount of DM 143,000,000.00 have been incurred.

Grants may be drawn down for costs eligible for assistance before presentation
of invoices if such costs are expected be incurred in the subsequent 2 months
after disbursement.

To each Notice of Drawdown a confirmation of an auditor according to Appendix 5b
has to be attached.

Otherwise the drawdown requirements mentioned in Section 2 of the General
Conditions - Version for the Principal Bank - and - Version for the Grant
Recipient - shall apply, insofar as nothing else has been agreed in this subsidy
agreement (including the Schedule of Conditions).


PROCESSING FEE

We shall charge no fee for the processing of the grant application.

We cover your own processing charges you may arrange with the grant recipient
for a flat fee up to [*] of the committed investment and interest grant.


DRAWDOWN OF THE INTEREST GRANT FUNDS

The interest grant will also be disbursed through us upon evidence that interest
payments are due on the above mentioned load provided by the principal bank.


GENERAL CONDITIONS

The attached General Conditions for Grants from the Regional Economic Structural
Development Programme of the Free State of Saxony - Version for the Principal
Bank, including the Additional Agreements concluded with the Letter of Consent
between Dresdner Bank AG in Dresden and the Sachsische Aufbaubank dated January
31, 1997 and Version for the Grant Recipient - and the Schedule of Conditions
are an integral part of this commitment letter.


* CONFIDENTIAL INFORMATION OMITTED AND
FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION

You undertake to conclude a corresponding subsidy agreement with the grant
recipient on the basis of this commitment letter and to incorporate the above
mentioned General Conditions - Version for the Grant Recipient - as an integral
part of your subsidy agreement with the grant recipient.

The principal bank assigns with immediate effect all claims arising from this
agreement to the Sachsische Aufbaubank. The Sachsische Aufbaubank accepts this
assignment.


Yours faithfully,




Appendices:
- ----------
1. Schedule of Conditions
2. General Conditions for the Principal Bank and the Grant Recipient, August
1995
3. Letter of Consent including the Additional Agreements dated January 31, 1997
4. Declaration of Liability
5. Drawdown documents a) + b) + c)
6. Certificate of intermediate-use and Certificate of use a) + b)

Appendix 1
- ----------

SCHEDULE OF CONDITIONS

to the letter
dated February 12, 1997

AMD SAXONY MANUFACTURING GmbH

Customer no. 262-206553


GENERAL COVENANTS:

1. Financial assistance is provided on the basis of the General Conditions for
Grants under the Regional Economic Development Programme of the Free State
of Saxony, Version 31514 dated August 1995 and 31515 dated August 1995.

2. In granting this assistance we assume that the intangible assets being
subsidised have not been acquired/will not be acquired from affiliated
companies or companies with other business, legal or personnel linkages.

3. Assistance is granted provided that the grants will be claimed back (pro
rata, as the case may be) in the event that the subsidised economic assets
leave the Grant recipient's possession during the commitment period or are
no longer used in the Grant recipient's facility with the exception of
expenditure on replacements of at least the same value in the ordinary
course of business. Other usage of project (e.g. renting/leasing) or a
disposal of assets shall be excluded. Renting and leasing in the course of a
demerger, pooling of interests or partnership shall be subject to approval
by the Sachsische Aufbaubank ("SAB").

4. Assistance is granted provided that the Grant recipient is endowed with a
nominal share capital in an amount of DM 217.5 million and entered in the
Register of Companies. The total amount must be paid up by no later than end
1997.

5. Assistance is provided subject to the granting of shareholder loans by
Advanced Micro Devices, Inc., Sunnyvale California/U.S.A. ("AMD Inc.")
totalling DM 290 million in favour of the Grant recipient to be paid in two
--------------
instalments of DM 145 million each in 1998 and 1999. During the term of the
--------------
guaranteed loans interest and redemption payments on the shareholder loans
will require the prior approval of SAB.

6. Assistance is granted provided that any overruns of the anticipated total
investment costs for the construction of the production facility in Dresden
(including the development centre) above and beyond DM 2,430,000,000.00
million (excluding additional investment coast for ongoing capital
expenditure in the amount of DM 551,000,000.00) up to a further amount of
altogether DM 225,000,000.00 million by additional equity and bank loans
(with 65% guarantee backing) in the ratio 1:2


and to finance in full any investment cost overruns in excess thereof by
additional equity (nominal capital/shareholder loans).

7. Assistance is granted provided that AMD Inc. and the Grant Recipient
conclude a "Wafer Purchase Agreement" with the Borrower to take - from the
time of completion (which is scheduled to take place by 2001 at the least)
onwards -all the output from the Dresden plant on the basis of full cost
reimbursement in DM prices plus a 10%-profit-margin complying with German
cost accounting principles and including the development centre, according
to the following provisions:

- reimbursement of start-up losses for the years 1996 to 1998 exceeding the
budgeted amounts as well as a provision for the years 1999 and 2000
concerning cost reimbursement by AMD Inc. in the amount of 75% and 105%
irrespective of the actual capacity utilization;

- AMD Inc. covers the market risk within a capacity utilization range from
100% to 75% p.a. of the planned/standard capacity utilization by securing
a "stable cash-flow" within this capacity utilization range.

Compliance with the above mentioned provisions shall be confirmed each year
by the auditor in the course of the annual audit of the Grant recipient.

8. Assistance is granted provided that any market-induced adjustments in
production will be shared proportionally amongst all the production
facilities belonging to the AMD group manufacturing products comparable to
those of the Grant recipient, according to the principle of equal
treatment, if the actual capacity utilization of AMD Manufacturing GmbH
falls below 75% of the planned/standard capacity utilization. Other
allocations are only permissable, if AMD Inc. covers the cashflow shortfall
of AMD Saxony Manufacturing GmbH caused by such allocations; determination
of such other AMD production facilities as well as the monitoring of
adherence to the equal treatment principle monitored will be carried out in
suitable manner with aid of neutral third parties.

9. Assistance is granted provided that any permanent cash flow surpluses of
the Grant recipient's will be used for premature repayment of the
guaranteed loans to be agreed upon between the Grant Recipient and lenders
in a separate arrangement.

10. Assistance is granted provided that in addition to production bona fide
research will be carried out at the Dresden plant and the development
centre will be occupied with the design and development of modern products;
for this the following declaration issued by AMD Inc. in a letter dated
January 18th, 1996 shall apply:

"In this respect the design centre will be a genuine research and
development facility. 200 high qualified staff there will devote themselves
to the research and development of modern products. Much of their activity
will consist of independent research into state-of-the-art technology,
emphasis being placed on the development and design of new products for
manufacture not only in Dresden but in AMD's facilities worldwide. The
range of products will probably comprise a broad spectrum of state-of-the-
art digital components such as microprocessors and circuits for
telecommunications and the multimedia sector. In


--The german version will be binding--

line with the design centres at our locations in the United States, the
Dresden facility will also address the redesign and development of
variations on existing products."

The declaration issued by AMD Inc. in a letter dated January 18th, 1996
shall apply:

"We accept that in the event AMD should default on the loan and that the
banks then take over the facility, a qualified buyer of the facility should
be able to produce his own products there using the equipment and tools set
in place.... We believe that the facility and the equipment set in place
will be sufficient to allow operation of the production facility. Thus a
qualified buyer would not be encumbered from manufacturing his own products
in the facility."

11. Assistance is granted provided that any exchange of goods and services
between the Grant recipient and AMD Inc. as well as companies within the
reach of influence of AMD Inc. going beyond the "Wafer Purchase Agreement"
will be settled on the basis of customary market terms; the auditor will
comment on this in the course of their annual audits of the Grant
recipient.


DISBURSEMENT CONDITIONS:

1. The current certified annual financial statements and an analysis of the
operating figures for the month preceeding the disbursement must be sent to
SAB with each Notice of Drawdown provided that the actual certified annual
statement has not been presented at a previous drawdown. The results must
justify the disbursement of public financial aid. A disbursement is not
justified, if based on the above mentioned information there is an imminent
threat to the continued existence of the Grant Recipient.

2. The real estate purchase contract must be sent to us prior to the first
disbursement.

3. The Articles of Incorporation as well as the bylaws of the Grant recipient
must be submitted to us prior to the first disbursement. Any change of the
legal situation has to be immediately announced to the SAB.

4. Cost eligible for assistance include the cost of purchase or the cost of
manufacturing for tangible fixed assets (Sachanlagevermogen) according to
German GAAP with regard to the investment project. Excluded from assistance
are capital expenditure for the procurement of replacement assets,
vehicles, minor-value assets, real estate and capitalised real estate
expenses.

The Grant recipient will be obliged to capitalise the capital expenditures
as stated in the investment plan approved in conjunction with the loan
commitment as additions to the company's fixed assets.

Prior to the first disbursement we must receive confirmation from the tax
adviser/auditors and from the Grant recipient that they have taken note of
the above mentioned conditions.


5. Prior to the first disbursement AMD Inc. and the Grant recipient shall
confirm to us that the investment project supported by the CA grant has not
been, and will not be, the object of previous or future applications for
public aid funds. Likewise confirmation must be rendered that the
Sachsische Aufbaubank has been notified of all the grants employed or
applied for in connection with the subsidised investment project for which
assistance is being provided herewith.

6. Prior to the first disbursement of funds confirmation by the principal bank
must be submitted that financing of the project is secured in accordance
with the financial plan described in the grant offer provided that the
Grant recipient shall communicate and comment any deviations from the
financial plan. In the event that additional financial assistance is
provided, causing the maximum permissible amount of subsidies to be
exceeded, we reserve the right vis-a-vis the Grant Recipient to reduce the
grant proportionately.

7. Prior to the first disbursement of funds the formal declaration by the
principal bank and the loan agreements must be presented to us.
Furthermore, an updated financial plan of the Grant Recipient's has to be
submitted to us.

8. For the present grant offer and the amount of subsidies on which it is
based we have assumed that no special depreciation will be claimed for the
-----------------------
economic assets for which assistance is granted. This must be confirmed to
us in writing by the tax adviser/auditors prior to the first disbursement
of funds. Furthermore such confirmation has to be rendered within each
annual financial statement of the Grant recipient.

9. We further assume that the Grant recipient has fulfilled its tax
commitments. A certificate of non-objection from the tax authorities
providing information on the tax-related circumstances of the company and
its shareholders must be sent to us prior to the first disbursement of
funds.

10. Before the first disbursements of funds related to capital expenditure on
construction evidence must be submitted to SAB that an incontestable
building permit has been issued therefor.

11. In the event that the equity (nominal capital and shareholder loans)
scheduled in the above financial plan is not employed in full, AMD Inc. and
AMD Saxony Holding GmbH shall assume joint and several liability together
with the Grant Recipient for the cases set forth in Sections 7 and 8 of the
General Conditions for the Grant Recipient in version 31515 dated August
1995. The original of the attached declaration, duly signed and sealed with
the company stamp - must be presented to SAB no later than at the time of
first drawdown of the grants.

12. Prior to the first disbursement commercial register excerpts of the Grant
Recipient and of AMD Saxony Manufacturing GmbH have to be provided to SAB
via the principal bank.


DISCLOSURE REQUIREMENT AND CERTIFICATES OF USE

1. The Grant recipient shall immediately notify the SAB, if the total
investment cost are reduced or the financing is changed by more than DM
10,000,000.00 --. Other-


--The german version will be binding--

wise Section 6 of the General Conditions - Version for the Grant recipient
- and - Version for the principal bank - shall apply.

2. The Grant recipient shall submit Certificates of use to us via the
principal bank. The final Certificate of use (Appendix 6a) shall be
presented no later than six months after termination of the investment
project, by June 30, 2007, to the Sachsische Aufbaubank (SAB). Six months
after termination of the first stage of the investment - June 30, 2002 - an
initial Certificate of intermediate use (Appendix 6b) shall be submitted
without further reminder. SAB reserves the right to call for further
Certificates of intermediate use. In addition, on February 1 of each year a
report on the progress of the project shall be submitted to SAB, starting
with August 1, 1997. Separate reports shall also be submitted to the
European Commission if so required.

The correctness of the statements in the certificates of use and their
compliance with the books and records has to be confirmed by an auditor.

3. At the end of each year the principal bank shall submit a Certificate of
intermediate use with regard to the interest grants furnished. This
Certificate of intermediate use (Appendix 6b) must contain confirmation of
the amount of interest expenses paid on the loan provided by the principal
bank in connection with use of the loan for the investment project in
Dresden. Further Certificates of use shall be submitted by the Grant
Recipient and the principal bank upon request of the SAB or its agents.


RECISSION OF GRANTS

A recission of grants in case the number of permanent jobs the financial
assistance is based on are not filled or are not filled in full is only possible
until June 30, 2007.

In the event grants are claimed back due to a partial non-compliance with the
conditions and/or other conditions for the provision of financial assistance the
recission of the grant is limited to a corresponding grant amount. Grants can
completely or partially be claimed backed even if the reason for recission has
been set by AMD Saxony Holding GmbH.


WASTE MANAGEMENT AND SOIL PROTECTION

The Grant recipient has to confirm within the subsidy contract that he will
comply with the objectives of waste management and soil protection (Section 1
and Section 7 EGAB / First Law on Waste Management and Soil Protection in the
Free State of Saxony) in an exemplary manner.


MISCELLANEOUS

As far as, in the course of the final revision of the guarantee application, any
changes of or additions to the covenants become necessary, the adjustment of the
covenants of the commitment letter is reserved.


Appendix 2a

General Provisions

for Subsidies
from the Regional Economic Development Program
of the Free State of Saxony

- Version for the Subsidy Recipient

1. Use of the Subsidy

1.1 The subsidy funds may only be used for the project named in the
acceptance for proportional coverage of the sponsored costs estimated
according to the application within the framework of the financing
plan.

1.2 The subsidy recipient must demonstrate the use of the subsidy
according to the attached forms or according to the documents provided
for verification of the source and disposition statement via the
company's bank to the Saxon Development Bank [SAB] on his own accord
on the occasion of each disbursement and after completion of the
project.

The subsidy recipient must retain the records and all documents
otherwise associated with assistance for at least 5 years, starting
from the end of the project (funds commitment term), if a longer
retention period is not defined according to provisions of tax law or
other regulations.

1.3 The project shall begin as soon as possible.

2. Request/Disbursement of the Subsidy

2.1 The subsidy recipient may only request the subsidy funds using the
attached request forms, when complete project financing is guaranteed.


The subsidy funds many only be called proportionally for already
incurred sponsored costs.

Within the framework of proportional financing the subsidy funds
should be used in proportion with the stipulated subsidy recipient's
own and other funds. The first call can be made when 10% of the
sponsored project costs have been incurred.

2

Using the attached form an interim source and disposition statement
should be kept for investment measures and the call statement should
be attached. For non-investment measures the corresponding invoice
copies should be attached.

2.2 If it is subsequently ascertained that the subsidy has been claimed in
whole or in part although the prerequisites for it were absent, the
amounts drawn contrary to the provisions must be immediately repaid
via the company's bank to the SAB. They can only be called again when
the prerequisites for the request have been satisfied.

3. Transfer

Transfer of claims from the subsidy agreement shall only be possible
with the consent of the company's bank and the Saxon Development Bank.
The company's bank shall be entitled to transfer or assign all claims
against the subsidy recipient besides ancillary rights or possibly
surrendered securities resulting from the subsidy agreement to the
Saxon Development Bank.

4. Reduction Proviso

The company's bank reserves the right to reduce the amount of the
subsidy in proportion on behalf of the Saxon Development Bank if the
sponsored costs of the project are lowered, other assistance funds are
increased, or other assistance funds are granted. Already disbursed
amounts must be immediately repaid to the Saxon Development Bank to
the extent they exceed the reduced subsidy amount.

5. Audit Rights

The Saxon Development Bank, the Free State of Saxony, represented by
its responsible agencies or an agency commissioned by them, and the
General Accounting Office of the Free State of Saxony and the
company's bank shall be entitled to review economical administration
and use of the dedicated subsidy by the subsidy recipient according to
the terms. To the extent EU funds are used, the equivalent shall
apply to the responsible EU agencies. The company's bank shall be
entitled to charge the costs which may result from the audit to the
subsidy recipient.

It shall be incumbent on the subsidy recipient to provide information
about the sponsored project to these agencies and to allow inspection
of company documents.

6. Information Obligations/Funds Commitment Term

It shall be incumbent on the subsidy recipient to immediately indicate
to the company's bank when changes arise relative to the information
in the application and all other

3

submitted documents which are all relevant to the subsidy. This
disclosure obligation shall begin with the acceptance date and end 5
years after completion of the project (funds commitment term).

In particular this disclosure obligation shall be immediate for the
subsidy recipient when

6.1 after submitting the financing plans he requests or receives further
allocations for the same purpose from other public agencies or when
the total expenditures are reduced or financing is changed by more
than 1000.- DM.

6.2 the number of permanent/training and women's jobs to be created or
guaranteed decreases,

6.3 the circumstances specified under item 7 prevail,

6.4 shutdown, sale, lease or rental of the sponsored plant in whole or in
part is impending or institution of a general attachment execution
according to the General Attachment Act or comparable insolvency
proceedings is requested for the property of the subsidy recipient.

6.5 corporate legal relationships change.

7. Cancellation of the Agreement and Recovery of the Subsidy

7.1 The company's bank shall be entitled to withdraw from this subsidy
agreement for good cause and to recover the subsidy for immediate
repayment, especially when

7.1.1 the subsidy recipient has improperly acquired the subsidy,

7.1.2 he is not executing the sponsored project or deviates from the
investments/non-investment measures underlying this acceptance.

7.1.3 he does not immediately use the subsidy in accord with the purpose
specified in this acceptance,

7.1.4 he does not satisfy the conditions, directions and other obligations
associated with the subsidy agreement,

7.1.5 he does not properly keep the source and disposition statement
according to the source and disposition statement form attached to the
acceptance or the documents provided for keeping the source and
disposition statement or does not submit them immediately after
completion of the project,

4

7.1.6 the number of permanent/training and women's jobs to be created or
guaranteed which are necessary for the assistance are not filled or
not reached.

7.1.7 other requirements for assistance are not met,

7.1.8 assistance requirements subsequently cease to exit,

7.1.9 before expiration of the funds commitment term (see item 6)

- the sponsored plant is shut down, sold, leased or rented in its
entirety or in part,

- sponsored capital goods separate from the sponsored plant,

- institution of a general attachment execution or comparable
insolvency proceedings is requested for the property of the
subsidy recipient.

7.1.10 The Saxon Development Bank has not approved a change of corporate legal
relationships.

7.2 Jobs must be in fact held or at least continually offered on the labor
market for a supervisory period of at least 5 years after the end of
the project (funds commitment term, item 6).

If the number of employees after completion of the project does not
correspond to the required number of permanent/training and women's
jobs, because the permanent/training and women's jobs have not been
created, the company's bank shall recover the subsidy in its entirety
or in proportion. The company's bank will also recover the subsidy if
permanent jobs have not been made available without interruption to
the labor market during the funds commitment term (see item 6). This
can be assumed if the number of actual employees during this five year
period was less for a longer time interval than the required number of
permanent/training and women's jobs.

7.3 Women's jobs should be held for a period of at least 5 years after
completion of the project.

The Saxon Development Bank will proportionally recover via the
company's bank the subsidy accepted to create women's jobs for the
times during which the total number of women's jobs cannot be proven.

8. Interest surcharge

5

8.1 The subsidy recipient must refund the subsidy at the request of the
company's bank when there are grounds for reduction as per item 4 or
there are grounds for cancellation as per items 7.1 - 7.3 and must pay
interest from the time of disbursement on at the given lombard lending
rate.

8.2 It shall moreover be incumbent on the subsidy recipient at the request
of the company's bank to refund the subsidy or partial amounts thereof
and to pay interest in the amount specified in item 8.1 from the date
of disbursement on, if

a) the subsidy recipient has not used the subsidy made available to
him for payments rendered,

b) the subsidy was not immediately returned to the Saxon Development
Bank for lack of field of application,

c) due reduction of the subsidy for lack of notice by the subsidy
recipient did not take place

9. Amendments and Additions to the Agreement

Amendments and additions to the subsidy agreement must be in writing.

10. Legal invalidity of individual provisions

If individual provisions of this agreement should be or become
invalid, the other agreement provisions shall remain unaffected
thereby. It shall be incumbent on the parties to the agreement to
replace invalid provisions by equivalent provisions.

6

Appendix 2b

General Provisions

for Subsidies
from the Regional Economic Development Program
of the Free State of Saxony

- Version for the Company's Bank

1. Use of the Subsidy

1.1 The subsidy funds may only be used for the project named in the
acceptance for proportional coverage of the sponsored costs estimated
according to the application within the framework of the financing
plan.

1.2 The company's bank shall supervise the use of the subsidy funds, have
their use according to the terms demonstrated, and on its own accord
shall confirm to the Saxon Development Bank the correctness of the
source and disposition statement after completion of the project on
its forms or on the documents provided for this purpose.

The retention period for records and all documents otherwise
associated with assistance is at least 5 years, starting from the end
of the project (funds commitment term), if a longer retention period
is not defined according to provisions of tax law or other
regulations.

2. Request/Disbursement of the Subsidy

2.1 The company's bank may only request the subsidy funds using the
attached request forms, when complete project financing is guaranteed.


The subsidy funds many only be called proportionally for already
incurred sponsored costs.

Within the framework of proportional financing the subsidy funds
should be used in proportion with the stipulated subsidy recipient's
own and other funds. The first call can be made when 10% of the
sponsored project costs have been incurred.

Using the attached form an interim source and disposition statement
should be kept by the subsidy recipient and the call statement should
be attached. For non-investment measures the corresponding invoice
copies should be attached.

7

2.2 If it is subsequently ascertained that the subsidy has been claimed in
whole or in part although the prerequisites for it were absent, the
amounts drawn contrary to the provisions must be immediately repaid to
the Saxon Development Bank. They can only be called again when the
prerequisites for the claim have been satisfied.

3. Transfer

Transfer of claims from the subsidy agreement shall only be possible
with the consent of the company's bank and the Saxon Development Bank.

4. Reduction Proviso

The Saxon Development Bank reserves the right to reduce the amount of
the subsidy in proportion if the sponsored costs of the sponsored
project are lowered, other assistance funds are increased, or other
assistance funds are granted. Already disbursed amounts must be
immediately repaid to the Saxon Development Bank to the extent they
exceed the reduced subsidy amount.


5. Audit Rights

The Saxon Development Bank, the Free State of Saxony, represented by
its responsible agencies or an agency commissioned by them, and the
General Accounting Office of the Free State of Saxony shall be
entitled to undertake an audit at any time at the company's bank if
necessary in conjunction with granting of the subsidy and in doing so
to inspect all documents relating to the subsidy. To the extent EU
funds are used, the equivalent shall apply relative to the responsible
EU agencies. The company's bank shall compensate the costs which may
result from the audit. They can be charged to the subsidy recipient.

The company's bank must furnish any desired information to these
agencies.

6. Information Obligations/Funds Commitment Term

It shall be incumbent on the company's bank to immediately indicate to
the Saxon Development Bank when changes arise relative to the
information in the application and all other submitted documents which
are all relevant to the subsidy. This disclosure obligation shall
begin with the acceptance date and end 5 years after completion of the
project (funds commitment term).

In particular this disclosure obligation shall be immediate for the
company's bank when

8

6.1 after submitting the financing plans the subsidy recipient requests or
receives further allocations for the same purpose from other public
agencies or when the total expenditures are reduced or financing is
changed by more than 1000.- DM.

6.2 the number of permanent/training and women's jobs to be created or
guaranteed decreases,

6.3 the circumstances specified under item 7 prevail,

6.4 shutdown, sale, lease or rental of the sponsored plant in whole or in
part is impending or institution of a general attachment execution
according to the General Attachment Act or comparable insolvency
proceedings is requested for the property of the subsidy recipient.

6.5 the company's bank is to be changed. The Saxon Development Bank must
approve the change of the company's bank.

7. Cancellation of the Agreement and Recovery of the Subsidy

7.1 The company's bank will withdraw from the subsidy agreement concluded
with the subsidy recipient for good cause at the request of the Saxon
Development Bank and recover the subsidy for immediate repayment,
especially when

7.11 the subsidy recipient has improperly acquired the subsidy,

7.12 he is not executing the sponsored project or deviates from the
investments/non-investment measures underlying this acceptance,

7.13 he does not immediately use the subsidy in accord with the purpose
specified in this acceptance,

7.14 he does not satisfy the conditions, directions and other obligations
associated with the subsidy agreement,

7.15 he does not properly keep the source and disposition statement
according to the source and disposition statement form attached to the
acceptance or the documents provided for keeping the source and
disposition statement or does not submit them immediately after
completion of the project,

7.16 the number of permanent/training and women's jobs to be created or
guaranteed which are necessary for the assistance are not filled or
not reached.

9

7.17 other requirements for assistance are not met,

7.18 assistance requirements subsequently cease to exit,

7.19 before expiration of the funds commitment term (see item 6)

- the sponsored plant is shut down, sold, leased or rented in its
entirety or in part,

- sponsored capital goods separate from the sponsored plant,

- institution of a general attachment execution or comparable
insolvency proceedings is requested for the property of the
subsidy recipient.

7.2 Jobs must be in fact held or at least continually offered on the labor
market for a supervisory period of at least 5 years after the end of
the project (funds commitment term, item 6).

If the number of employees after completion of the project does not
correspond to the required number of permanent/training and women's
jobs, because the permanent/training and women's jobs have not been
created, the Saxon Development Bank shall recover the subsidy in its
entirety or in proportion via the company's bank. The Saxon
Development Bank will also recover the subsidy if permanent/training
and women's jobs have not been made available without interruption to
the labor market during the funds commitment term (see item 6). This
can be assumed if the number of actual employees during this five year
period was less for a longer time interval than the required number of
permanent/training and women's jobs.

7.3 Women's jobs should be held for a period of at least 5 years after
completion of the project.

The Saxon Development Bank will proportionally recover via the
company's bank the subsidy accepted to create women's jobs for the
times during which the total number of women's jobs cannot be proven.

7.4 When there are grounds for reduction as per item 4 or there are
grounds for cancellation as per items 7.1 - 7.3 the company's bank
will immediately remit the repaid subsidy to the Saxon Development
Bank.

7.5 The Saxon Development Bank shall be entitled to withdraw from this
subsidy agreement for good cause and demand immediate repayment of the
subsidy, especially when

10

a) the company's bank has acquired the subsidy improperly or
contrary to the provisions of the subsidy agreement,

b) the company's bank violates some other obligation assumed with
the subsidy agreement.

8. Interest surcharge relative to the subsidy recipient

8.1 The subsidy recipient must refund the subsidy at the request of the
Saxon Development Bank when there are grounds for reduction as per
item 4 or there are grounds for cancellation as per items 7.1 - 7.3
and must pay interest from the time of disbursement on at the given
lombard lending rate.

It shall be incumbent on the company's bank to lodge the reimbursement
claim besides any interest at the request of the Saxon Development
Bank against the subsidy recipient and to remit it immediately to the
Saxon Development Bank.

8.2 It shall moreover be incumbent on the subsidy recipient at the request
of the Saxon Development Bank to refund the subsidy or partial amounts
thereof and to pay interest in the amount specified in item 8.1 from
the date of disbursement on, if

a) the subsidy recipient has not immediately used the subsidy made
available to him for payments rendered,

b) the subsidy was not immediately returned to the Saxon Development
Bank for lack of field of application,

c) due reduction of the subsidy for lack of notice by the subsidy
recipient did not take place.

It shall be incumbent on the company's bank to lodge the reimbursement
claim besides any interest at the request of the Saxon Development
Bank against the subsidy recipient and to remit it immediately to the
Saxon Development Bank.

9 Interest surcharge relative to the company's bank

9.1 The company's bank must refund the subsidy at the request of the Saxon
Development Bank when there are grounds for withdrawal as per item 7.5
and must pay interest from the time of disbursement on at the given
lombard lending rate.

11

9.2 It shall moreover be incumbent on the company's bank at the request of
the Saxon Development Bank to refund the subsidy or partial amounts
thereof and to pay interest in the amount specified in item 9.1 from
the date of disbursement on, if


a) it does not transmit the subsidy immediately to the subsidy
recipient,

b) the subsidy has not been returned immediately to the Saxon
Development Bank for lack of field of application,

c) it does not remit amounts which it is obligated to remit to the
Saxon Development Bank according to the agreement.

10. Mode of Payment

All payments to the Saxon Development Bank shall be made at the risk
and costs of the company's bank.

11. Amendments and Additions to the Agreement

Amendments and additions to the subsidy agreement must be in writing.

12. Legal invalidity of individual provisions

If individual provisions of this agreement should be or become
invalid, the other agreement provisions shall remain unaffected
thereby. It shall be incumbent on the parties to the agreement to
replace invalid provisions by equivalent provisions.

12

Appendix 3

Declaration of Agreement

Saxon Development Bank
Pirnaische Strasse 9

01069 Dresden

Customer No.: 262-206553
Project No.: 2514-7943

Regional Economic Development Program of the Free State of Saxony

Company: AMD Saxony Manufacturing GmbH

Dear Sirs:

We hereby declare ourselves in agreement with the contents of your
amended acceptance (including all appendices) dated February 12, 1997 with
recognition of the General Provisions for Subsidies from the Regional Economic
Development Program of the Free State of Saxony which were sent to us, including
the Supplementary Agreement dated February 12, 1997 which has been countersigned
by us and which is attached to this Declaration of Agreement.

It shall be incumbent on us to conclude the subsidy agreement with the
subsidy recipient on the basis of this acceptance and to make the direction
sheet and the General Provisions - Version for the Subsidy Recipient - (as
modified by the Allocation Instruction and the instruction sheet) part of our
subsidy agreement with the subsidy recipient.


- ------------------------- -------------------------------------------
(Date and Place) (Stamp and signature of the Company's Bank)

13

Supplementary Agreements

The Saxon Development Bank (hereinafter called the "SAB") has submitted to
Advanced Micro Devices Saxony Manufacturing GmbH Dresden (hereinafter
called "AMD Saxonia or "subsidy recipient") as the subsidy recipient via
the company's bank an amended proposal dated February 12, 1997 for
construction of a plant for manufacture of microelectronic products in
Dresden for extending investment subsidies in the amount of 476,687,000.00
DM and interest subsidies in the amount of 300,000,000.00 DM (jointly also
the "subsidies").

Within the framework of the company's bank process conventional in the Free
State of Saxony the subsidies shall be extended via the Dresdner Bank AG in
Dresden ("Dresdner Bank") as the banker to the subsidy recipient.

To specify and delineate the obligations to be assumed by the company's
bank and the possible liabilities associated therewith for them, the
following shall hereby be agreed upon by way of clarification and in
addition to the allocation instruction and the General Provisions for
Subsidies from the Regional Economic Development Program of the Free State
of Saxony - version for the Company's Bank - status 08/95 ("General
Provisions" or "AGB") between the SAB and Dresdner Bank as the prerequisite
for assuming the function of the company's bank:

1. The SAB shall make available to the Dresdner Bank investment subsidies in
the amount of 476,687,000 DM and interest subsidies in the amount of 300
million DM for transfer to the subsidy recipient. With signing of the
declaration of agreement by the Dresdner Bank an agency agreement between
SAB and Dresdner Bank shall exist.

2. Thus it shall be incumbent on the Dresdner Bank to transfer the subsidy to
AMD Saxonia and to make the AGB (Version for the Subsidy Recipient) and the
conditions and disbursement prerequisites part of its subsidy agreement
with AMD Saxonia.

3. Dresdner Bank shall not be liable to the SAB for repayment of the
subsidies, but only for careful fulfillment of its obligations to SAB
accepted expressly in this agreement, as the banker of the subsidy
recipient. Item 7.5 (a) of the AGB (Version for the Company's Bank) shall
constitute one exception thereto.

These obligations must be satisfied with the diligence which Dresdner Bank
is accustomed to exercising in its own affairs as well.

4. Within the framework of supervision of the funds call and monitoring the
use of the funds, the Dresdner Bank shall fulfill its obligations to the
SAB by monitoring the use of the subsidies by causing to be demonstrated
the use of the subsidies according to the terms with the employment of an
auditor of the subsidy recipient agreeable to the company's bank. Dresdner

14

Bank will have the correctness of the source and disposition statement
confirmed once again by the auditor after completion of the project and
will forward this confirmation to the SAB.

The Dresdner Bank shall coordinate the manner of confirmation with the SAB.
In addition, the Dresdner Bank shall verify the correctness of the
confirmation by random sampling. With regard to the interest subsidies
proof shall be furnished by submitting the corresponding bank confirmations
regarding interest accrued.

5. The subsidies shall be claimed via the company's bank by call declaration
of the subsidy recipient. The subsidy recipient will attached one source
and disposition statement at a time to the call declaration. All source
and disposition statements must be kept by the subsidy recipient. The
Dresdner Bank shall not be liable either for the timely submittal or for
late filing of the source and disposition statements.

6. The retention obligation for records and all documents otherwise associated
with assistance according to item 1.2 of the General Provisions and the
disclosure obligation according to item 6 of the General Provisions shall
end 5 years after completion of the project.

7. Complete financing of the project shall be considered guaranteed with
delivery of the company's bank declaration desired by the SAB in
conjunction with the granting of the subsidies.

8. Amounts drawn contrary to the provisions according to item 2.2 of the
General Provisions must be repaid by the subsidy recipient via the Dresdner
Bank or at the request of the SAB by him directly to the SAB. The
equivalent shall apply to repayment of reduced subsidy amounts (item 4 of
the AGB) and to recovery of subsidy amounts (item 7.2 of the AGB). Item
7.4 of the AGB shall apply.

9. The Dresdner Bank as the banker of the subsidy recipient shall furnish to
the SAB, the Free State of Saxony and the responsible EU agencies on
request all information necessary in conjunction with the granting of the
subsidy.

10. Within the framework of this agreement, immediately shall be construed to
mean after allowance of an appropriate period of 30 bank working days.

11. The disclosure obligation according to item 6.1 of the General Provisions
shall exist only when the subsidy recipient has made application for
further allocations for the same purpose from other public agencies via the
Dresdner Bank as the company's bank. Otherwise a disclosure obligation of
the Dresdner Bank according to item 6 shall exist only if the office of the
Dresdner Bank responsible for handling the transfer of subsidies has
learned of measures

15

subject to the disclosure requirement especially according to items 6.1 -
6.5 of the General Provisions while exercising the diligence which it
ordinarily applies in bank transactions.

12. Transfer of recovered subsidies according to item 7.4 of the General
Provisions by the Dresdner Bank to the SAB shall presuppose that the
Dresdner Bank has received them beforehand. Recovery of subsides according
to item 7.5 (a) of the General Provisions shall presuppose violation of
obligations to the SAB by the Dresdner Bank. An independent recovery claim
against the Dresdner Bank may only be lodged as a compensation claim.

In this case the Dresdner Bank shall have the right to assert - in case of
damages this must be proven by the Dresdner bank - that the claimed damages
would have arisen in their entirely or in part even without its fault.

13. Amendments to this agreement must be in writing to be valid. This shall
also apply to amendments of this written form clause.

14. If one of the agreements should be invalid or impracticable in whole or in
part, the preceding agreement shall remain otherwise unaffected thereby.
The parties shall replace an agreement which is wholly or partially invalid
or impracticable by an agreement which commercially best corresponds to the
impracticable or invalid provision in its result. This shall apply
accordingly to the case in which deficiencies in the provisions should be
subsequently ascertained.

Dresden, Feb. 12, 1997 Dresden, 1997

/signature/
Signatures illegible
- --------------------------- -------------------------------
Saxon Development Bank Dresdner Bank AG in Dresden

16

Appendix 4
- ----------

DECLARATION OF LIABILITY

Sachsische Aufbaubank
Pirnaische Strasse 9

06109 Dresden

Customer no. 262-206553
Project no. 2514-7943

REGIONAL ECONOMIC DEVELOPMENT PROGRAMME OF THE FREE STATE OF SAXONY

Company: AMD Saxony Manufacturing GmbH

Together with the applicant, AMD Saxony Manufacturing GmbH, Advanced Micro
Devices, Inc. and AMD Saxony Holding GmbH will assume joint and several
liability for the grants amounting to DM 476,687,000.00 in the cases set forth
in Sections 7 and 8 of the General Conditions for Grants under the Regional
Economic Development Programme of the Free State of Saxony - Version for the
Grant Recipient - version 31515 dated August 1995 and the Schedule of Conditions
in the event that the equity scheduled in the financial plan (nominal capital
and shareholder loans equalling altogether DM 507,500,000.00) cannot be employed
in full by the applicant.


- ------------------------------
(Place and date)



- ------------------------------ ------------------------------
AMD Saxony Manufacturing GmbH AMD Saxony Holding GmbH
(Signature and company stamp) (Signature and company stamp)


- ------------------------------
Advanced Micro Devices, Inc.
(Signature and company stamp)