##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 20-F
 (Mark One)o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934orþ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 28, 2008oro
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from tooro
    
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934Date of event requiring this shell company report
 Commission file number 000-29103
 STATS ChipPAC Ltd.
 (Exact Name of Registrant as specified in its charter)
 10 Ang Mo Kio Street 65#05-17/20 TechpointRepublic of Singapore
    
    Singapore 569059(Jurisdiction of incorporation or organization)
    
    (Address of principal executive offices)
 Janet T. Taylor
General Counsel
10 Ang Mo Kio Street 65
#05-17/20 Techpoint
Singapore 569059
Telephone: (65) 6824 7777 Facsimile: (65) 6720 7829
 (Name, Telephone, Email and/or Facsimile number and Address of Company Contact Person)
  None
    
    None(Title of Class)
    
    (Name of Exchange on which registered)
 Ordinary Shares, no par value
 None
  2,202,218,293 Ordinary Shares of Registrant.
  o þ
  o þ
  þ o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
  U.S. GAAP þ
    
    International Financial Reporting Standards as issued
by the International Accounting Standards Board o
    
    Other o
  o o
  o þ
  o o




---



##### 



TABLE OF CONTENTS
 PAGEITEM 1.
    
    IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
    
    
    2ITEM 2.
    
    OFFER STATISTICS AND EXPECTED TIMETABLE
    
    
    2ITEM 3.
    
    KEY INFORMATION
    
    
    2ITEM 4.
    
    INFORMATION ON THE COMPANY
    
    
    24ITEM 4A.
    
    UNRESOLVED STAFF COMMENTS
    
    
    47ITEM 5.
    
    OPERATING AND FINANCIAL REVIEW AND PROSPECTS
    
    
    47ITEM 6.
    
    DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
    
    
    68ITEM 7.
    
    MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
    
    
    80ITEM 8.
    
    FINANCIAL INFORMATION
    
    
    82ITEM 9.
    
    THE OFFER AND LISTING
    
    
    83ITEM 10.
    
    ADDITIONAL INFORMATION
    
    
    84ITEM 11.
    
    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    98ITEM 12.
    
    DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
    
    
    99ITEM 13.
    
    DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
    
    
    99ITEM 14.
    
    MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
    
    
    99ITEM 15.
    
    CONTROLS AND PROCEDURES
    
    
    99ITEM 16A.
    
    AUDIT COMMITTEE FINANCIAL EXPERT
    
    
    100ITEM 16B.
    
    CODE OF ETHICS
    
    
    100ITEM 16C.
    
    PRINCIPAL ACCOUNTANT FEES AND SERVICES
    
    
    101ITEM 16D.
    
    EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEE
    
    
    102ITEM 16E.
    
    PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
    
    
    102ITEM 16F.
    
    CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT
    
    
    102ITEM 16G.
    
    CORPORATE GOVERNANCE
    
    
    102ITEM 17.
    
    FINANCIAL STATEMENTS
    
    
    102ITEM 18.
    
    FINANCIAL STATEMENTS
    
    
    102ITEM 19.
    
    EXHIBITS
    
    
    102SIGNATURES
    
    
    107INDEX TO FINANCIAL STATEMENTS
    
    
    F-1EX-8.1 List of subsidiariesEX-12.1 Certification by the Chief Executive Officer pursuant to 17 CFR 240. 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002EX-12.2 Certification by the Chief Financial Officer pursuant to 17 CFR 240. 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002EX-13.1 Certification by the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002EX-13.2 Certification by the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002EX-15.1 Consent of PricewaterhouseCoopers LLP, Singapore, independent registered public accounting firm
  i




---



##### Table of Contents



GENERAL INFORMATION
       1




---



##### Table of Contents



FORWARD-LOOKING STATEMENTS
    
 ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
  
 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
  
 ITEM 3. KEY INFORMATION
 A. Selected Financial Data
  2




---



##### Table of Contents



Year EndedDecember 31,
    
    
    December 25,
    
    
    December 31,
    
    
    December 30,
    
    
    December 28,2004
    
    
    2005
    
    
    2006
    
    
    2007
    
    
    2008(In thousands except per share data)Statement of Operations Data:Net revenues
    
    $
    769,121
    
    
    $
    1,157,253
    
    
    $
    1,616,933
    
    
    $
    1,651,560
    
    
    $
    1,658,188Cost of revenues
    
    
    (643,540
    )
    
    
    (968,023
    )
    
    
    (1,290,773
    )
    
    
    (1,330,284
    )
    
    
    (1,383,797
    )Gross profit
    
    
    125,581
    
    
    
    189,230
    
    
    
    326,160
    
    
    
    321,276
    
    
    
    274,391Operating expenses:Selling, general and administrative
    
    
    84,501
    
    
    
    135,751
    
    
    
    139,466
    
    
    
    112,593
    
    
    
    118,337Research and development
    
    
    17,637
    
    
    
    26,071
    
    
    
    30,446
    
    
    
    34,918
    
    
    
    37,825Restructuring charges (1)
    
    
    
    
    
    
    830
    
    
    
    1,938
    
    
    
    990
    
    
    
    19,790Equipment impairment (2)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,091Accelerated share-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,562Tender offer expenses
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,922
    
    
    
    Held for sale asset impairment (3)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,725
    
    
    
    Goodwill impairment (4)
    
    
    453,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total operating expenses
    
    
    555,138
    
    
    
    162,652
    
    
    
    171,850
    
    
    
    161,148
    
    
    
    198,605Operating income (loss) (5)
    
    
    (429,557
    )
    
    
    26,578
    
    
    
    154,310
    
    
    
    160,128
    
    
    
    75,786Other income (expense), net:Interest expense, net
    
    
    (24,386
    )
    
    
    (36,215
    )
    
    
    (40,415
    )
    
    
    (33,192
    )
    
    
    (30,301
    )Foreign currency exchange gain (loss)
    
    
    (1,122
    )
    
    
    531
    
    
    
    (1,578
    )
    
    
    2,487
    
    
    
    5,247Equity income (loss) from equity investee
    
    
    
    
    
    
    
    
    
    
    152
    
    
    
    102
    
    
    
    (1,437
    )Other non-operating income (expense), net
    
    
    (936
    )
    
    
    (1,076
    )
    
    
    108
    
    
    
    (442
    )
    
    
    27Total other expense, net
    
    
    (26,444
    )
    
    
    (36,760
    )
    
    
    (41,733
    )
    
    
    (31,045
    )
    
    
    (26,464
    )Income (loss) before income taxes
    
    
    (456,001
    )
    
    
    (10,182
    )
    
    
    112,577
    
    
    
    129,083
    
    
    
    49,322Income tax expense
    
    
    (7,894
    )
    
    
    (9,689
    )
    
    
    (25,759
    )
    
    
    (29,581
    )
    
    
    (19,172
    )Income (loss) before minority interest
    
    
    (463,895
    )
    
    
    (19,871
    )
    
    
    86,818
    
    
    
    99,502
    
    
    
    30,150Minority interest
    
    
    (3,828
    )
    
    
    (6,440
    )
    
    
    (10,010
    )
    
    
    (5,818
    )
    
    
    (4,448
    )Net income (loss)
    
    $
    (467,723
    )
    
    $
    (26,311
    )
    
    $
    76,808
    
    
    $
    93,684
    
    
    $
    25,702Net income (loss) per ordinary share:Basic
    
    $
    (0.33
    )
    
    $
    (0.01
    )
    
    $
    0.04
    
    
    $
    0.05
    
    
    $
    0.01Diluted
    
    $
    (0.33
    )
    
    $
    (0.01
    )
    
    $
    0.04
    
    
    $
    0.04
    
    
    $
    0.01Net income (loss) per ADS (6):Basic
    
    $
    (3.27
    )
    
    $
    (0.13
    )
    
    $
    0.39
    
    
    $
    0.46
    
    
    
    n.a.Diluted
    
    $
    (3.27
    )
    
    $
    (0.13
    )
    
    $
    0.37
    
    
    $
    0.44
    
    
    
    n.a.Ordinary shares (in thousands) used in per
ordinary share calculation:Basic
    
    
    1,428,954
    
    
    
    1,961,950
    
    
    
    1,991,110
    
    
    
    2,032,962
    
    
    
    2,143,934Diluted
    
    
    1,428,954
    
    
    
    1,961,950
    
    
    
    2,161,545
    
    
    
    2,188,687
    
    
    
    2,146,249ADS (in thousands) used in per ADS calculation (6):Basic
    
    
    142,895
    
    
    
    196,195
    
    
    
    199,111
    
    
    
    203,296
    
    
    
    n.a.Diluted
    
    
    142,895
    
    
    
    196,195
    
    
    
    216,154
    
    
    
    218,869
    
    
    
    n.a.
 3




---



##### Table of Contents



Year EndedDecember 31,
    
    
    December 25,
    
    
    December 31,
    
    
    December 30,
    
    
    December 28,2004
    
    
    2005
    
    
    2006
    
    
    2007
    
    
    2008(In thousands except per share data)Other Financial Data:Depreciation and amortization, including
amortization of debt issuance cost
    
    $
    188,683
    
    
    $
    256,099
    
    
    $
    268,688
    
    
    $
    256,913
    
    
    $
    286,428Amortization of leasing prepayments
    
    
    25,718
    
    
    
    25,790
    
    
    
    7,386
    
    
    
    11
    
    
    
    Capital expenditures
    
    
    270,785
    
    
    
    277,712
    
    
    
    348,495
    
    
    
    268,754
    
    
    
    239,020Net cash provided by operating activities
    
    
    136,617
    
    
    
    270,729
    
    
    
    427,771
    
    
    
    411,512
    
    
    
    419,525Net cash used in investing activities
    
    
    (264,824
    )
    
    
    (262,993
    )
    
    
    (425,783
    )
    
    
    (299,088
    )
    
    
    (283,714
    )Net cash provided by (used in) financing activities
    
    $
    41,128
    
    
    $
    (9,423
    )
    
    $
    (54,861
    )
    
    $
    (70,450
    )
    
    $
    (53,465
    )
 As OfDecember 31,
    
    
    December 25,
    
    
    December 31,
    
    
    December 30,
    
    
    December 28,2004
    
    
    2005
    
    
    2006
    
    
    2007
    
    
    2008(In thousands except per share data)Balance Sheet Data:Cash and cash equivalents
    
    $
    227,509
    
    
    $
    224,720
    
    
    $
    171,457
    
    
    $
    213,461
    
    
    $
    295,916Working capital
    
    
    124,028
    
    
    
    250,369
    
    
    
    227,967
    
    
    
    31,610
    
    
    
    192,588Total assets
    
    
    2,271,702
    
    
    
    2,393,382
    
    
    
    2,458,280
    
    
    
    2,596,954
    
    
    
    2,447,063Net assets
    
    
    1,200,241
    
    
    
    1,190,321
    
    
    
    1,304,096
    
    
    
    1,443,766
    
    
    
    1,607,699Current installments of obligations under capital
leases
    
    
    7,587
    
    
    
    7,091
    
    
    
    3,680
    
    
    
    
    
    
    
    Short-term borrowings and current installments of
long-term debt
    
    
    174,281
    
    
    
    35,542
    
    
    
    61,693
    
    
    
    240,781
    
    
    
    76,953Obligation under capital leases, excluding current
installments
    
    
    10,771
    
    
    
    3,680
    
    
    
    
    
    
    
    
    
    
    
    Long-term debt, excluding current installments
    
    
    642,175
    
    
    
    775,425
    
    
    
    697,523
    
    
    
    423,853
    
    
    
    396,500Shareholders equity
    
    
    1,159,350
    
    
    
    1,141,652
    
    
    
    1,246,150
    
    
    
    1,383,969
    
    
    
    1,548,657Share capital (7)
    
    
    298,233
    
    
    
    303,052
    
    
    
    1,847,002
    
    
    
    1,891,546
    
    
    
    2,035,235Additional paid-in capital
    
    $
    1,507,612
    
    
    $
    1,517,118
    
    
    $
    
    
    
    $
    
    
    
    $
    Ordinary shares outstanding (in thousands)
    
    
    1,944,330
    
    
    
    1,976,292
    
    
    
    2,002,814
    
    
    
    2,047,334
    
    
    
    2,202,218
 
 Notes:(1)
    
    Restructuring charges recorded in connection with our reduction of our workforce of $830,000,
$1,938,000, $990,000 and $19,790,000 to align our expenses with revenues in 2005, 2006, 2007
and 2008, respectively. The 2008 restructuring charges includes the reduction of
approximately 1,600 employees which we announced in December 2008. This workforce reduction
is expected to be completed in the first quarter of 2009.(2)
    
    In 2008, we recorded equipment impairment charges of $21,091,000 as a result of our ongoing
assessment of property, plant and equipment for impairment.(3)
    
    In 2007, we recorded impairment charges of $1,725,000 on the disposal of the packaging and
test equipment related to discrete power packages to Ningbo Mingxin Microelectronics Co. Ltd.
(Mingxin).(4)
    
    In 2004, we recorded impairment charges of $453,000,000 on our goodwill associated with
purchase accounting for the acquisition of ChipPAC.(5)
    
    Includes share-based compensation expenses of $658,000 and $743,000 in accordance with
Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees (APB
25), in 2004 and 2005, respectively, and $13,688,000, $8,869,000 and $3,570,000 in accordance
with Statement of Financial Accounting Standards (SFAS) No. 123 (Revised 2004), Share-Based
Payment (SFAS 123(R)), in 2006, 2007 and 2008, respectively.(6)
    
    We voluntarily delisted our ADSs from Nasdaq effective December 31, 2007. 4




---



##### Table of Contents



(7)
    
    Effective January 30, 2006, our Company was subjected to the amendments promulgated under the
Companies (Amendment) Act of 2005 of Singapore. These amendments included the abolition of
the ordinary share par value and authorized capital. As a result of the abolition of the
ordinary share par value, the balance of additional paid-in capital, amounting to
$1,517,175,000 became part of our share capital as of January 30, 2006. B. Capitalization and Indebtedness
  C. Reasons for the Offer and Use of Proceeds
  D. Risk Factors
  Risks Relating to Our Company
 The current global economic condition has adversely affected the semiconductor markets and the
demand for our products and services, and a protracted global economic crisis would have a
material adverse effect on us.
  
    
    cancel or reduce planned expenditures for our products and services;
    
    seek to lower their costs by renegotiating their contracts with us;
    
    consolidate the number of suppliers they use which may result in our loss of customers;
or
    
    switch to lower-priced products or services provided by our competitors.
  Downturns in the semiconductor industry have adversely affected our operating results and may
continue to adversely affect our operating results.
  
    
    decreases in product demand;
 5




---



##### Table of Contents




    
    excess capacity;
    
    excess inventories;
    
    increased competition from competitors; and
    
    accelerated erosion in average selling prices.
  A continuing decrease in demand for communications equipment, consumer and multi-applications, or
PCs may adversely affect our business.
  Decisions by our IDM customers to curtail outsourcing may adversely affect our business.
   We may not be able to compete successfully in our industry.
    6




---



##### Table of Contents




    
    their desire to realize higher utilization of their existing test and packaging
capacity;
    
    their unwillingness to disclose proprietary technology;
    
    their possession of more advanced packaging and testing technologies; and
    
    the guaranteed availability of their own packaging and test capacity.
  We depend on a small number of customers for a significant portion of our revenues and any
decrease in sales to any of them could adversely affect our business and results of operations.
    We may not be able to develop or access leading technology which may affect our ability to compete
effectively.
   7




---



##### Table of Contents



We may not be able to adequately assess and monitor credit risks of our customers which may result
in longer collection cycles and bad debt expense.
  The application of push-down accounting or any other change in accounting standards could affect
our results of operations.
    Our profitability will be affected by average selling prices of packaging and test services that
have experienced pricing pressures and have a tendency to decline.
  We may be subject to intellectual property rights disputes which could materially and adversely
affect our business.
  8




---



##### Table of Contents




    
    stop using certain processes or other intellectual property;
    
    cease manufacturing, using, importing or selling infringing packages;
    
    pay substantial damages;
    
    develop non-infringing technologies; or
    
    attempt to acquire licenses to use the infringed technology.
     9




---



##### Table of Contents



We may not be able to successfully implement our strategy if we do not control our operating
expenses.
   We have experienced substantial losses in the past and may do so in the future.
  Our substantial indebtedness could adversely affect our financial health.
   
    
    increasing our vulnerability to general adverse economic and industry conditions by
limiting our flexibility in planning for, or reacting to, changes in the business and the
industry in which we operate;
    
    requiring us to dedicate a substantial portion of our cash flow from operations to
payments on our indebtedness, thus reducing the availability of cash flow to fund working
capital, capital expenditures, research and development, and other general corporate
purposes;
    
    placing us at a competitive disadvantage relative to our competitors that have less
leverage; and
    
    limiting, along with the financial and other restrictive covenants in the indebtedness,
our ability to borrow additional funds.
  10




---



##### Table of Contents



To service our indebtedness and other potential liquidity requirements, we will require a
significant amount of cash. Our ability to generate cash depends on many factors beyond our
control and we may need to access the credit market to meet our liquidity requirements.
    We recorded an impairment charge of $453.0 million to our earnings in 2004 and may be required to
record another significant charge to earnings in the future when we review our goodwill or other
intangible assets for potential impairment.
  We expect to incur significant capital expenditures in the future and therefore may require
additional financing in the future, which may not be available on terms favorable to us, if at
all.
   11




---



##### Table of Contents




    
    limit our Company or our subsidiaries ability to pay dividends or require us to seek
consents for the payment of dividends;
    
    increase our vulnerability to general adverse economic and industry conditions;
    
    limit our ability to pursue our growth plan;
    
    require us to dedicate a substantial portion of our cash flow from operations to
payments on our debt, thereby reducing the availability of our cash flow to fund capital
expenditures, working capital and other general corporate purposes; and
    
    limit our flexibility in planning for, or reacting to, changes in our business and our
industry.
  We could suffer adverse tax and other financial consequences if taxing authorities do not agree
with our interpretation of applicable tax laws.
  We may be classified as a passive foreign investment company which could result in adverse U.S.
federal income tax consequences to U.S. Holders.
  12




---



##### Table of Contents



Our intellectual property is important to our ability to succeed in our business but may be
difficult to obtain and protect.
    Our operating results have fluctuated, and may continue to fluctuate, from quarter to quarter,
which may make it difficult to predict our future performance.
  
    
    general economic conditions in the semiconductor industry and the markets addressed by
end-users of semiconductors;
    
    a shift by IDMs between internal and outsourced test and packaging services;
    
    the seasonality of the semiconductor industry;
    
    the short-term nature of our customers commitments;
    
    the rescheduling or cancellation of large orders;
    
    the timing and volume of orders relative to our capacity;
    
    changes in capacity utilization;
    
    the erosion of the selling prices of packages;
    
    changes in our product mix;
    
    the rescheduling, cancellation and timing of expenditures in anticipation of future
orders;
    
    disruptions caused by the installation of new equipment;
    
    the ability to obtain adequate equipment and materials on a timely and cost-effective
basis;
    
    any exposure to currency and interest rate fluctuations that may not be adequately
covered under our hedging policy;
 13




---



##### Table of Contents




    
    weakness in the supply of wafers and substrates;
    
    loss of key personnel or the shortage of available skilled workers;
    
    goodwill and equipment impairments;
    
    restructuring charges; and
    
    changes in effective tax rates.
  If we are unable to maintain or increase our capacity utilization, our gross margin will be
adversely affected.
   
    
    overall industry conditions;
    
    installation of new equipment in anticipation of future business;
    
    the level of customer orders;
    
    operating efficiencies;
    
    mechanical failure;
    
    disruption of operations due to expansion of operations, introduction of new packages or
relocation of equipment;
    
    disruption in supply of raw materials;
    
    changes in product mix; and
    
    fire or other natural disasters.
  14




---



##### Table of Contents



If we are unable to obtain packaging and testing equipment in a timely manner or on reasonably
favorable terms and prices, we may be unable to meet customer demand and our revenue may decline.
   We have entered into a number of financing arrangements that impose limitations on our actions
which may limit our ability to maintain and grow our business.
  
    
    incur additional debt and issue certain preferred stock;
    
    declare or pay dividends, repurchase stock and make other distributions;
    
    prepay subordinated debt, make investments and other restricted payments;
    
    create or incur liens or encumbrances;
    
    create restrictions on the ability of our subsidiaries to pay dividends or make other
payments;
    
    enter into transactions with affiliates;
    
    sell assets, consolidate or merge with or into other companies or reorganize our
Company;
    
    enter into sale and leaseback transactions; and
    
    designate any of our subsidiaries as unrestricted subsidiaries (as such term is defined
in the indenture governing the respective notes).
   Research and development investments may not yield profitable and commercially viable packages or
test services and thus will not necessarily result in increases in revenues for us.
  15




---



##### Table of Contents



We do not have any significant backlog because our customers do not place purchase orders far in
advance, which makes us vulnerable to sudden changes in customer demand.
  We generally do not have any long-term supply contracts with our raw materials suppliers and may
not be able to obtain the raw materials required for our business at reasonable prices, which
could have a material adverse effect on our business.
  We need a controlled environment for our operations and any prolonged inability to maintain a
clean room environment may disrupt our operations and, materially and adversely affect our
business.
  Loss of our key management and other personnel, or an inability to attract such management and
other personnel, could impact our business.
  16




---



##### Table of Contents



The packaging and testing process is complex and our production yields and customer relationships
may suffer from defects or malfunctions in our testing equipment or defective packages and the
introduction of new packages.
   
    
    contaminants in the manufacturing environment;
    
    human error;
    
    equipment malfunction;
    
    defective raw materials; or
    
    defective plating services.
   Liabilities and obligations under certain environmental laws and regulations could require us to
spend additional funds and could adversely affect our business, financial condition and results of
operations.
  Significant fluctuations in exchange rates may affect our business, financial condition and
results of operations.
  17




---



##### Table of Contents



Our ability to make further investments in our subsidiaries may be dependent on regulatory
approvals.
  Temasek controls our Company and its interests may conflict with the interests of our other
shareholders.
   
    
    the election of directors;
    
    the merger or consolidation of our Company with any other entity;
    
    any sale of all or substantially all of our assets; and
    
    the timing and payment of dividends.
  
    
    the acquisition by any person of additional securities of our Company, or the
disposition of securities of our Company;
    
    an extraordinary corporate transaction, such as a merger, reorganization or liquidation,
involving our Company or any of our subsidiaries;
    
    a sale or transfer of a material amount of assets of our Company or any of our
subsidiaries;
    
    any change in our present Board of Directors or management of our Company, including
plans or proposals to change the number or term of directors or to fill any existing
vacancies on our Board of Directors;
    
    any material change in the present capitalization or dividend policy of our Company;
    
    any other material change in our Companys business or corporate structure;
 18




---



##### Table of Contents




    
    changes in our Companys charter or bylaws or other actions which may impede the
acquisition of control of our Company by any person;
    
    causing a class of securities of our Company to be delisted from a national securities
exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a
registered national securities association;
    
    causing a class of equity securities of our Company to become eligible for termination
of registration pursuant to Section 12(g)(4) of the Exchange Act; or
    
    any action similar to any of those enumerated above.
  We may have conflicts of interest with our affiliates which may not be resolved in our favor.
  We may not be successful in our acquisitions and investments in other companies and businesses and
may face difficulties in integrating our acquisitions.
   
    
    our ability to identify suitable opportunities for investment or acquisition;
    
    our ability to finance any future acquisition or investment on terms acceptable to us or
at all;
    
    whether we are able to reach an acquisition or investment agreement on terms that are
satisfactory to us or at all;
    
    the extent to which we are able to exercise control over the acquired company;
    
    the economic, business or other strategic objectives and goals of the acquired company
compared to those of our Company; and
 19




---



##### Table of Contents




    
    our ability to successfully integrate the acquired company or business with our
business.
  If we encounter future labor problems, we may fail to deliver our products in a timely manner
which could adversely affect our revenues and profitability.
  New laws and regulations, currency policy and political instability in countries in which we
operate, particularly in South Korea, China, Malaysia Taiwan and Thailand could make it more
difficult for us to operate successfully.
  
    
    regulatory limitations imposed by foreign governments;
    
    fluctuations in currency exchange rates;
    
    political, military and terrorist risks;
    
    disruptions or delays in shipments caused by customs brokers or government agencies;
    
    unexpected changes in regulatory requirements, tariffs, customs, duties and other trade
barriers;
    
    difficulties in staffing and managing foreign operations; and
    
    potentially adverse tax consequences resulting from changes in tax laws.
  Conducting business in China involves uncertainties and there can be no assurances that the
intended benefits from our new China facility will be realized.
  
    
    economic and political uncertainties in China;
    
    local infrastructure problems, such as electrical power interruptions;
    
    transportation difficulties that may be encountered in receiving supplies and/or in
shipping finished products by land or by air;
 20




---



##### Table of Contents




    
    an unwillingness or hesitancy on the part of customers to qualify their products in the
new facilities;
    
    an inability to attract and retain sufficient and qualified engineering and management
talent and resources;
    
    measures which may be introduced to control inflation or deflation;
    
    continuing appreciation in the value of the Chinese Renminbi currency; and
    
    modifications to fiscal, banking or monetary policies to reduce the rate of future
growth in China.
 Because a significant portion of STATS ChipPAC Taiwan Semiconductor Corporations business and
operations, our 300mm wafer bumping facility, the production facilities of many of our suppliers
and customers and providers of complementary semiconductor manufacturing services, are located in
Taiwan, a severe earthquake could severely disrupt their normal operations and adversely affect
our earnings.
  With our operations conducted in a limited number of facilities, a fire, flood or other calamity
at one of our facilities could adversely affect us.
  Outbreaks of epidemics and communicable diseases in China and other parts of Asia may disrupt our
business operations, causing us to lose customers and revenue.
  21




---



##### Table of Contents



Risks Relating to Our Ordinary Shares
  The trading price of our ordinary shares has been and may continue to be volatile.
  
    
    quarterly variations in operating results;
    
    changes in financial estimates and recommendations by securities analysts;
    
    the operating and stock price performance of other companies in our industry;
    
    developments affecting us, our customers or our competitors;
    
    changes in government regulation;
    
    changes in general economic conditions;
    
    changes in accounting principles;
    
    the timing of the termination of the registration of our ordinary shares and reporting
obligations under the Exchange Act; and
    
    other events or factors described in this annual report.
  We intend to seek to terminate the registration of our ordinary shares and our reporting
obligations under the Exchange Act if and when we become eligible to do so.
  Our Companys efforts to meet applicable conditions for deregistration under the Exchange Act may
result in a diversion of managements time and other resources.
  22




---



##### Table of Contents



The SGX-ST may suspend and/or delist our ordinary shares on the SGX-ST. Furthermore, we may
voluntarily delist our ordinary shares from the SGX-ST.
     Our public shareholders may have more difficulty protecting their interests than they would as
shareholders of a company incorporated in the United States.
  23




---



##### Table of Contents



It may be difficult for you to enforce any judgment obtained in the United States against us or
our affiliates.
  The Singapore securities market is relatively small and more volatile than markets in the United
States and may cause the market price of our ordinary shares to fluctuate.
  Our concentrated ownership reduces the trading liquidity of our ordinary shares and there can be
no assurance that a more liquid trading market will ever develop or be sustained.
  Future sales, perceived sales, or issuances of our ordinary shares by our Company or existing
shareholders could cause the price of our ordinary shares to decline.
  
 ITEM 4. INFORMATION ON THE COMPANY
 A. History and Development of our Company
    24




---



##### Table of Contents



www.statschippac.com. Information contained on our website does not constitute a part of this
annual report.
       25




---



##### Table of Contents



.
 B. Business Overview
  
    
    Packaging services:providing leaded, laminate, memory card and wafer level chip-scale
packages (CSPs) to customers with a broad range of packaging solutions and full backend
turnkey services for a wide variety of electronics applications. We also provide
redistribution layers (RDL), integrated passive devices (IPD) and wafer bumping
services for flip-chip and wafer level CSPs.
As part of customer support on packaging services, we also offer package design; electrical,
mechanical and thermal simulation; measurement and design of lead-frames and laminate
substrates;
    
    Test services:including wafer probe and final testing on a diverse selection of test
platforms covering the major test platforms in the industry. We have expertise in testing a
broad variety of semiconductors, especially mixed-signal, radio frequency (RF), analog
and high-performance digital devices. We also offer test-related services such as burn-in
process support, reliability testing, thermal and electrical characterization, dry pack,
and tape and reel; and
    
    Pre-production and post-production services:such as package development, test software
and related hardware development, warehousing and drop shipment services.
    26




---



##### Table of Contents



Our Industry
         Semiconductor Manufacturing Process
  
    
    wafer fabrication, including wafer probe, wafer bumping and input/output (I/O) trace
redistribution;
    
    assembly of bare semiconductors, or die, into finished semiconductors (referred to as
assembly or packaging); and
    
    final testing of assembled semiconductors.
 Wafer Fabrication.
 27




---



##### Table of Contents



Wafer Probe.
 Wafer Bumping.
 I/O Trace Redistribution.
 Assembly.
 Final Testing.
 Our Strengths and Strategy
  Leverage our broad portfolio of packaging and test services to provide full turnkey solutions.
 Leverage our established presence in the major geographic hubs of wafer fabrication.
 Capitalize on our research and development capabilities to drive accelerated growth.
 Continue to cultivate our strong customer relationships.
 Continue to focus on high-quality customer service.
 28




---



##### Table of Contents



Our Services
   Year EndedDecember 31,
    
    December 30,
    
    December 28,2006
    
    2007
    
    2008Packaging  laminate
    
    
    55.5
    %
    
    
    56.3
    %
    
    
    56.5
    %Packaging  leaded
    
    
    18.3
    
    
    
    18.4
    
    
    
    18.0Test and other services
    
    
    26.2
    
    
    
    25.3
    
    
    
    25.5Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
 Packaging Services
  Laminate Packaging.
  
    
    smaller size;
    
    greater pin count, or number of connections to the printed circuit board;
    
    greater reliability;
    
    higher power dissipation;
    
    better electrical signal integrity; and
    
    easier attachment to a printed circuit board.
  29




---



##### Table of Contents



3D Packaging
 Flip-chip.
  
    
    Standard BGA.Standard BGA packaging has a grid array of balls on the underside of the
IC, and is used in high-performance applications, like PC chipsets, graphic controllers and
DSPs. A BGA generally has greater than 100 balls.
    
    Chip-scale.Chip-scale packaging includes all packages where the package is less than
1.2 times the size of the silicon die. Chip-scale BGA is a substrate-based package that is
designed for memory devices and other medium pin count semiconductors and requires dense
ball arrays in very small package sizes, like wireless telephones and mobile hand-held
devices, video cameras, digital cameras and pagers.
    
    SiP.SiP is a family of packages that contain several semiconductor dies along with
passive components such as resistors, capacitors and inductors in one package. Dies can
either be stacked on top of each other or side by side. This technology allows greater
functionality in the same package footprint and thickness without significant cost
increase. These packages are used in wireless handsets, consumer products and mobile
computing applications.
    
    Chip-scale Module Packaging (CSMP).CSMP is an advanced SiP solution which features a
modular architecture that integrates mixed IC technologies and a wide variety of IPD such
as resistors, capacitors, inductors, filters, Balanced Unbalanced (BALUNs) and
interconnects directly onto a silicon substrate. The result is a high performance,
system-level solution, which provides a significant reduction in die size, weight, number
of interconnections and system board space requirements, and can be used for many
applications.
    
    Flip-chip.Flip-chip solutions range from large single die packages with passive
components used for graphics and ASIC devices, to modules and complex 3D packages that
contain logic, memory and RF devices and that integrate flip-chip and wire bonding
interconnection within the same package. Flip-chip packages are available in various
package formats including Quad Flat No-Lead (QFN), Low-Profile Fine-Pitch Ball Grid Array
(LFBGA), Land Grid Array (LGA), BGA, Flip-Chip Ball Grid Array with Multi-Package
Module (fcBGA-MP), and complex 3D packages (SiP, MD, PiP).
 30




---



##### Table of Contents




    
    3D Package Stacking (PiP, PoP)Stacking pretested packages together in single solution
is emerging as a next generation technology of choice in wireless applications. For
applications such as mobile phones which require integration of a digital base band or DSP
and an analog device, PiP and PoP are effective stacked package solutions. 3D, next
generation packages are available in various package formats including PiP, Flip-chip PiP
(fcPiP), PoP and Fan-in Package-on-Package (FiPoP).
 (i)
    
    PiP is a 3D package in which separately assembled and tested packages and bare
chips are stacked together in a single CSP for exceptional integration flexibility and
functional density in a smaller form factor. PiP technology provides design flexibility
in integrating several logic and/or analog devices with memory devices in a single
package.(ii)
    
    The fcPiP is an innovative 3D package stacking solution which integrates the
baseband, memory and analog functions of a mobile communication device into a single
package. The fcPiP represents a packaging approach that combines several advanced
technologies such as bumped wafer thinning, thin die flip-chip attach and low loop wire
bonding on the same substrate.(iii)
    
    PoP is a 3D package in which fully tested packages such as single die FBGA (as
defined herein) or stacked die FBGA (FBGA-SD) (typically MD) is stacked on top of
another single FBGA-SD (which is typically base band or analog die) during the board
mount process.(iv)
    
    FiPoP is a 3D packaging stacking solution. The bottom FiPoP (FiPoPb) provides
the flexibility to package a single device or multiple devices (logic, analog or
memory), while providing land pads on the top center of the package to allow for another
package or components to be reflowed on top. A fully tested package such as single die
FBGA or FBGA-SD (typically memory die) is stacked on a bottom PoP package which usually
contains a logic device or logic device combination (logic + logic, logic + analog).(v)
    
    Pre-stacked PoP is a 3D package solution where the top PoP package is stacked on
top of the bottom PoP package, and both of them are reflowed together and tested prior
to the final integration on the application board.
  NumberPackage Format
    
    of I/Os
    
    Description
    
    Types of ApplicationsFine Pitch Land Grid Array
(FLGA)
    
    8-200
    
    Laminate substrate
based package with
plastic overmolded
encapsulation.
Unlike a standard
FBGA, second level
interconnect is
achieved on the LGA
by connecting
lands on the
package directly
onto the printed
circuit board
through solder
re-flow. Available
in a broad range of
Joint Electron
Device Engineering
Council (JEDEC)
standard body sizes
including Thin
Profile FLGA
(<1.20mm)
(TFLGA), Very
Thin Profile FLGA
(<1.00mm)
(VFLGA) and Very
Very Thin Profile
FLGA (<0.80mm)
(WFLGA) package
thickness.
    
    Mobile phone, wireless RF,
analog, ASIC, memory chip.FLGA-SD
    
    8-200
    
    Compact MD designed
for space sensitive
applications.
Capability to stack
up to seven dies in
one package.
Available packages
include Low Profile
FLGA-SD, Thin
Profile FLGA-SD,
Very Thin FLGA-SD,
Very Very Thin
Profile FLGA-SD,
Ultra Thin Profile
FLGA-SD and
Extremely Thin
FLGA-SD packages.
    
    Mobile phone, wireless RF,
analog, ASIC, memory chip.Flip-chip Low Profile Fine Pitch BGA (fcLFBGA)
    
    49-144
    
    Chip-scale BGA with
Flip-chip/bump
interconnect,
instead of wire
bonding.
    
    Mobile phone, Wide Area
Network (WAN)/Local Area
Network (LAN) equipment.Flip-chip BGA (fcBGA)
    
    225-1,152
    
    BGA with
Flip-Chip/bump
interconnect
instead of
    
    DSP, ASIC, FPGA.
 31




---



##### Table of Contents



NumberPackage Format
    
    of I/Os
    
    Description
    
    Types of Applicationswire
bonding. Available
packages include
fcBGA with attached
heat sink, fcBGA-MP
and fcBGA for SiP
packages.Fine Pitch BGA (FBGA)
    
    40-450
    
    Smaller and thinner
BGA designed for
applications which
are space
constrained and
require electrical
performance.
Available in a
broad range of
JEDEC standard body
sizes with Low
Profile FBGA
(<1.70mm,
typically
<1.40mm)
(LFBGA), Thin
Profile FBGA
(<1.20mm)
(TFBGA), Very
Thin Profile FBGA
(<1.00mm)
(VFBGA), Very
Very Thin Profile
FBGA (<0.80mm)
(WFBGA) and Ultra
Thin Profile FBGA
(0.55mm max.)
(UFBGA) package
thickness. LFBGA
with attached heat
sink (LFBGA-H) is
qualified for small
body sizes.
    
    Mobile hand-held devices,
Global Positioning System
(GPS) and multimedia.Stacked Die Fine Pitch BGA (FBGA-SD)
    
    40-450
    
    Compact MD designed
for space sensitive
applications.
Capability to stack
up to seven dies in
one package.
Available in a
broad range of
JEDEC standard body
sizes with LFBGA,
TFBGA, VFBGA, WFBGA
and UFBGA package
thickness. LFBGA-H
(with attached
heatsink) is
qualified for small
body sizes.
    
    Mobile hand-held devices and
multimedia.Plastic Ball Grid Array (PBGA)
    
    169-1,253
    
    Electrically
enhanced BGA
package designed
for high I/O
replacement.
    
    Access/LAN equipment,
PC/graphics and base
station.Stacked
Die Plastic Ball Grid Array (PBGA-SD)
    
    121-1,253
    
    Increased
sub-system
performance
achieved by
integrating
multiple chips into
a single package.
Capability to stack
up to seven dies in
one package.
    
    DSPs and memory, gate
arrays, ASICs, PC chipsets
and peripherals,
microprocessors/controllers.Exposed Drop-in Heat Spreader Plastic BGA (PBGA-H)
    
    169-1,253
    
    Thermally enhanced
PBGA with 20%
greater thermal
dissipation than
PBGA.
    
    Access/LAN/PC/graphics and
base station equipment.Plastic Ball Grid Array
 Multi-Die (PBGA-MD)
    
    74-1,253
    
    BGA integrated with
two or more MD
within a PBGA.
    
    Access/LAN/PC/graphics and
base station equipment.PiP
    
    40-450
    
    PiP integrates ASIC
logic with memory
chip(s) and can
have a minimal
12x12mm footprint,
1.2 to 1.4mm
maximum thickness,
and incorporate a
0.5mm to 0.4mm ball
pitch.
    
    Mobile hand-held devices,
PC, MPEG-1 Audio Layer 3
players (MP3 players),
base station modems, memory
cards and consumer
electronics.fcPiP
    
    600+
    
    3D package that
stack minimally
packaged die and
bare die into a
single molded
package. A
pre-tested Internal
Stacking Module
(ISM) LGA and one
or more bare die
are stacked with at
least one bare die
connected to the
substrate using
flip-chip
interconnection.
    
    Portable electronics,
cellular phones, gaming,
PDAs, digital cameras,
camcorders and wireless
products.PoP
    
    128-700
    
    3D package in which
fully tested
package is stacked
on top of another
package during the
board mount
process. Available
in a broad range of
JEDEC standard body
sizes with LFBGA,
TFBGA and VFBGA .
    
    Mobile hand-held devices,
PC, MP3 players, base
station modems, memory cards
and consumer electronics.
 32




---



##### Table of Contents



NumberPackage Format
    
    of I/Os
    
    Description
    
    Types of ApplicationsFiPoP
    
    200-700
    
    3D package in which
the FiPoPb provides
the flexibility to
package a single
device or multiple
devices (logic,
analog or memory),
while providing
land pads on the
top center of the
package to allow
for another package
or components to be
reflowed on top.
The FiPoPb can also
incorporate a fully
tested ISM package.
FiPoPb is available
in a broad range of
JEDEC standard body
sizes including
TFBGA and VFBGA
package thickness.
    
    Cellular phone and mobile
device digital baseband
processor, digital die
stack, or digital + analog
baseband die stack, digital
+ memory (ISM) stack,
Cellular phone and mobile
device memory for digital
processor and system memory
(synchronous dynamic random
access memory, NOR/NAND
Flash, Static Random Access
Memory )Pre-stacked PoP
    
    PoPt:108
PoPb:168
    
    3D package in which
the top and bottom
PoP packages are
assembled and
tested separately,
then stacked and
reflowed together
to produce a
complete high
performance 3D
solution.
    
    NAND Memory for data
storage, logic/ controller,
solid state disk for Mobile
PC.
 Leaded Packaging.
 Standard Lead-frame Packages.
 NumberPackage Format
    
    of I/Os
    
    Description
    
    Types of ApplicationsThin Small Outline 
Package (TSOP)
    
    28-56
    
    Traditional
lead-frame package
with two-side
leads, and a
surface mount
technology (SMT)
designed for
memory,
RF/wireless, logic,
linear and
automotive devices.
    
    PCs, portable
electronics,
networking equipment
and automotive
electronics.Thin Quad Flat Package (TQFP)
    
    32-128
    
    Advanced Quad Flat
Package (QFP)
with thickness of
1.0mm for use in
low profile,
space-constrained
applications.
    
    Mobile phone, mass
storage and
multimedia.Low Quad Flat Package (LQFP)
    
    32-208
    
    Advanced QFP with
thickness of 1.4mm
for use in low
profile,
space-constrained
applications.
    
    Mobile phone, mass
storage and
multimedia.Metric Quad Flat Package (MQFP)
    
    44-240
    
    Traditional QFP
designed for ASICs,
FPGAs and DSPs.
    
    Access/LAN
equipment,
multimedia and mass
storage.
 Enhanced Lead-frame Packages.
  33




---



##### Table of Contents



NumberPackage Format
    
    of I/Os
    
    Description
    
    Types of ApplicationsQFN
    
    4-88
    
    Lead-frame based plastic
encapsulated CSP in single mold
cavity format or molded array
format. Available in a broad
range of JEDEC standard body
sizes including Extremely Thin
Quad Flat Non-Leaded Package
(XQFN) (<0.50mm), Ultra
Thin Quad Flat Non-Leaded
Package (UQFN) (<0.65mm),
Very Very Thin Quad Flat
Non-Leaded Package (WQFN)
(<0.80mm) and Very Thin Quad
Flat Non-Leaded Package (VQFN)
(<1.00mm) package thickness.
    
    Mobile hand-held devices and GPS.Dual Row Quad Flat No-Lead (QFN-dr)
    
    44-156
    
    QFN version with staggered dual
row leads offers higher I/O
counts.
    
    Mobile hand-held devices and GPS.Quad Flat No-Lead Package
(Strip Etch) (QFNs-se)
    
    32-396
    
    QFNs-se, with multiple rows of
terminals, is leadframe based,
plastic encapsulated, chip scale
in molded array format (saw
singulated). An exposed die pad
coupled with extremely low RLC
provides excellent electrical
and thermal performance
enhancements. Available in a
broad range of JEDEC standard
body sizes including UQFN
(<0.65mm).
    
    Computing and
telecommunications, RF, power
management, analog/linear,
logic, ASICs, and DSP.Bumped Chip Carrier (BCC)
    
    16-84
    
    Lead-frame based near chip-scale.
    
    Mobile hand-held devices and GPS.Dual Row Bumped Chip 
Carrier (BCCs)
    
    84-148
    
    BCC version with staggered dual
row leads offers higher I/O
counts.
    
    Mobile hand-held devices and GPS.Exposed
Pad Low Quad Flat Package (LQFP-ep)
    
    32-208
    
    Thermally enhanced QFP with 30%
greater thermal dissipation than
MQFP.
    
    Access/WAN/LAN equipment and
PC/graphics and hard disk drive
(HDD).Exposed Pad Thin Quad Flat Package (TQFP-ep)
    
    32-128
    
    Thermally enhanced TQFP with 30%
greater thermal dissipation than
TQFP.
    
    Access/WAN/LAN equipment,
PC/graphics, HDD, mobile
hand-held devices and GPS.Stacked Die Quad Flat 
Package (LQFP-SD)
    
    32-208
    
    Compact MD designed for space
constrained applications.
    
    Mobile hand-held devices, GPS,
HDD and multimedia.Stacked Die Exposed Pad 
Low Quad Flat Package
(LQFP-ep-SD)
    
    32-208
    
    Thermally enhanced LQFP-SD
designed for space constrained
applications with thickness of
1.4mm and greater thermal
dissipation than LQFP-SD.
    
    Mobile hand-held devices, PC,
GPS, HDD, MP3 players, pagers
and consumer electronics.Stacked Die Exposed Pad 
Thin Quad Flat Package
(TQFP-ep-SD)
    
    32-128
    
    Thermally enhanced with MD TQFP
designed for space constrained
applications with thickness of
1.0mm and greater thermal
dissipation than LQFP-SD.
    
    Mobile hand-held devices, PC,
GPS, HDD, MP3 players and
consumer electronics.Stacked Die Thin Small 
Outline Package
(TSOP-SD)
    
    24-56
    
    Compact MD designed for space
constrained applications.
    
    Mobile hand-held devices, GPS,
HDD and multimedia.
 34




---



##### Table of Contents



Wafer Process Services.
 Embedded Wafer-Level Ball Grid Array (eWLB).
   Test Services
    35




---



##### Table of Contents



Mixed-signal and RF Testing. Bluetooth (tm) Bluetooth (tm) Bluetooth (tm)
 Digital Testing.
 Memory Testing.
 Test-Related Services.
 
    
    Burn-in process support.Burn-in is the process of electrically stressing
semiconductors, usually at high temperature and voltage, for a period of time long enough to
cause the failure of marginal semiconductors. During burn-in process support, we perform an
analysis of burn-in rejects in order to determine the cause of failure.
    
    Reliability testing.Reliability testing is the process of testing a semiconductor to
evaluate its life span. It is performed on a sample of devices that have passed final
testing.
    
    Thermal and electrical characterization.Thermal and electrical characterization is the
process of testing a semiconductor for performance consistency under thermal and electrical
stress.
    
    Dry pack.Dry pack is the process of baking the semiconductors in order to prevent the
failure of any semiconductors due to exposure to moisture during shipping. We dry pack
many of our packaged ICs in specially sealed, environmentally secure containers.
    
    Tape and reel.Many electronic assembly lines utilize tape and reel methods in which
semiconductors are placed into a pocket tape to enable faster attachment to the printed
circuit board. We offer a service in which we ship packaged and tested devices on a tape and
reel mechanism, in a tray or in a tube in accordance with our customers post-test
requirements.
 Pre-production and Post-production Services
  36




---



##### Table of Contents



Package Development.
 Test Software and Hardware Development.
  Warehousing and Drop Shipment Services.
 Research and Development
  Packaging Services
  37




---



##### Table of Contents




    
    Chip-scale Module Package (WLCSMP-fc-SiP-SS);
    
    QFN-dr;
    
    PiP stacking  TFBGA, fcLFBGA;
    
    PoP  TFBGA, VFBGA;
    
    Thin Internal Stack Module (Thin ISM);
    
    Flip-Chip Stacked Die Fine Pitch Ball Grid Array  fcT/L/VFBGA-SD;
    
    Extremely thin Quad Flat No-Lead  XQFN;
    
    Quad Flat No-Lead with Chip-on-Lead  UQFNs-COL-mini, WQFNs-COL;
    
    Multi Pad Quad Flat No-Lead  Multi Pad QFNs;
    
    QFNs-se;
    
    Memory Card Format  MS Micro, Multimedia Card, Micro SD, SD-USB, SD-USB-SiP;
 38




---



##### Table of Contents




    
    Stacked Die FBGA with Wire-in-Film Technology  T/LFBGA-SD (WIF);
    
    Wire Bonding with Bond on Trace Technology  60 micrometer (um) Finger Pitch;
    
    Molded Underfill Technology;
    
    Copper wire bonding;
    
    Plated Copper RDL-WLCSP-B;
    
    Extremely thin wafer level CSP with big bump  XWLCSP-B; and
    
    Fine Pitch Fan-in Package-on-Package  T/VFBGA FiPoP, fcVFBGA-FiPoP.
  Test Services
  Customers
   Year EndedDecember 31,
    
    December 30,
    
    December 28,2006
    
    2007
    
    2008Communications
    
    
    56.7
    %
    
    
    52.5
    %
    
    
    51.8
    %Customer and other applications
    
    
    24.6
    
    
    
    32.0
    
    
    
    31.6PCs
    
    
    18.7
    
    
    
    15.5
    
    
    
    16.6Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
  Year EndedDecember 31,
    
    December 30,
    
    December 28,2006
    
    2007
    
    2008United States
    
    
    73.2
    %
    
    
    74.7
    %
    
    
    72.5
    %Asia
    
    
    23.9
    
    
    
    22.3
    
    
    
    22.5Europe
    
    
    2.9
    
    
    
    3.0
    
    
    
    5.0Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
 39




---



##### Table of Contents



Sales and Marketing
   Bluetooth (tm)
 Pricing Policy
   Customer Service
  40




---



##### Table of Contents



Suppliers
 Raw Materials
  Equipment
   Packaging Equipment.
 Testing Equipment.
 41




---



##### Table of Contents



Quality Control
    Competition
   
    
    Advanced Semiconductor Engineering, Inc.  South Korea, Taiwan, China, Malaysia,
Singapore, Hong Kong and the United States;
    
    Amkor Technology, Inc.  South Korea, Japan, Taiwan, China, the Philippines, Singapore
and the United States; and
    
    Siliconware Precision Industries Co., Ltd.  Taiwan and China.
   
    
    their desire to realize higher utilization of their existing packaging or test capacity;
    
    their unwillingness to disclose proprietary technology;
    
    their possession of more advanced packaging or testing technologies; and
 42




---



##### Table of Contents




    
    the guaranteed availability of their own packaging or test capacity.
   Intellectual Property
        43




---



##### Table of Contents



Insurance
  Environmental Matters and Compliance
   44




---



##### Table of Contents



C. Corporate Structure
  (FLOWCHART) 
 Notes:(1)
    
    In June 2006, we entered into a strategic joint venture with CR Logic to sell packaging and
test equipment related to specific low lead count packages to CR Logics indirect wholly-owned
subsidiary, ANST, in connection with which we acquired a 25% shareholding in MAT with CR Logic
owning a 75% interest. ANST, an assembly and test company based in Wuxi, China, is a wholly
owned subsidiary of MAT.(2)
    
    In October 2007, we completed the acquisition of LSIs assembly and test operations in
Thailand.(3)
    
    STATS ChipPAC Test Services (Shanghai) Co. Ltd. was deregistered as a company and ceased to
exist on April 24, 2008. Its business was consolidated into STATS ChipPAC Shanghai Co., Ltd.
Prior to deregistration, our Company had three subsidiaries in China  STATS ChipPAC Test
Services (Shanghai) Co. Ltd., STATS ChipPAC Shanghai Co., Ltd. and STATS ChipPAC Semiconductor
Shanghai Co., Ltd. D. Property, Plants and Equipment
  Area
    
    
    
    Principal PackagingProperty/Location (1)
    
    (Sq. Feet)
    
    Functions/Services
    
    or Services ProvidedYishun, Singapore (2)
    
    
    594,738
    
    
    Turnkey packaging and test
services, research and
development, warehousing
services, and drop shipment
services
    
    Test services, including
mixed-signal and high
performance testing, wafer
sort and probe, traditional
and advanced leaded and
laminate packaging including
BGA, flip-chip packaging,
wafer level packaging and
CSP, wafer bumping and
fabrication of integrated
passive devices and drop
shipment services.
 45




---



##### Table of Contents



Area
    
    
    
    Principal PackagingProperty/Location (1)
    
    (Sq. Feet)
    
    Functions/Services
    
    or Services ProvidedAng Mo Kio, Singapore
    
    
    31,277
    
    
    Corporate executive,
administrative, sales and
marketing, and finance office.
    
    Corporate administration and
finance, sales and
marketing.Woodlands, Singapore (3)
    
    
    51,129
    
    
    Research and development on 3D
wafer level integration with
TSV.
    
    Research and development on
3D wafer level integration
with TSV and eWLB.Qing Pu, Shanghai, China (4)
    
    
    983,276
    
    
    Turnkey packaging and test
services, research and
development, warehousing
services, and drop shipment
services
    
    Packaging of leaded
packages, CSP, BGA, memory
card, wafer probe, test and
distribution services.Song Jiang, Shanghai, China
    
    
    11,795
    
    
    Solder bump services for
flip-chip assembly.
    
    Eutectic/High-lead/Lead-free
solder bump for 200mm
wafers.Icheon, South Korea
    
    
    769,955
    
    
    Turnkey packaging and test
services, research and
development, warehousing,
services, and drop shipment
services
    
    Advanced laminate packaging
such as SD, SiP and
flip-chip, standard laminate
packaging such as BGA and
CSP and test services.Icheon, South Korea (5)
    
    
    181,291
    
    
    Turnkey packaging and test
services, research and
development, warehousing
services, and drop shipment
services.
    
    Test services, including
mixed-signal and high
performance testing, wafer
sort and probe, traditional
and advanced leaded and
laminate packaging including
BGA, flip-chip packaging and
CSP.Hsin-Chu Hsien, Taiwan (6)
    
    
    218,149
    
    
    Test services, research and
development, warehousing
services, and drop shipment
services.
    
    Test development, final
test, wafer probe and
distribution services.Hsin-Chu Hsien, Taiwan
    
    
    6,730
    
    
    Solder bump services for
flip-chip assembly.
    
    Eutectic/High-lead solder
bump for 300mm wafers.Kuala Lumpur, Malaysia (7)
    
    
    488,448
    
    
    Turnkey packaging and test
services, research and
development, warehousing
services, and drop shipment
services
    
    Advanced lead-frame packages
such as lead-frame
chip-scale package (LFCSP)
and BCC and test services.Pathumthani, Thailand (8)
    
    
    463,000
    
    
    Turnkey packaging and test
services, research and
development, warehousing
services, and drop shipment
services
    
    Test services, including
mixed-signal and high
performance testing, wafer
sort and probe, traditional
and advanced leaded and
laminate packaging,
including BGA, and drop
shipment services.Fremont, California, United States
    
    
    56,320
    
    
    Sales, marketing,
administration and research
and development.
    
    Sales, marketing,
administration and design
review services.Milpitas, California, United States
    
    
    33,984
    
    
    Test facility and sales office.
    
    Sales, marketing,
administration, design and
test engineering services.San Diego, California, United States (9)
    
    
    20,000
    
    
    Test facility.
    
    Test engineering services.Tempe, Arizona, United States
    
    
    9,299
    
    
    Package design, research and
development and sales office.
    
    Sales, marketing,
administration, design and
characterization services.
 
 Notes:(1)
    
    We lease all of our facilities except where otherwise noted. 46




---



##### Table of Contents



(2)
    
    We own the production assets but lease the land from the statutory housing development board
of the Government of Singapore under a long-term lease with an initial term expiring in March
2026 with an option to renew.(3)
    
    We own the research and development assets but lease the premises for a term expiring in
October 2011 with an option to renew for a further term to be mutually agreed.(4)
    
    We own the building and improvements and lease the land, but the land and all buildings on
the land will revert to the lessor upon the expiration of the long-term lease in 2044.(5)
    
    We purchased a building together with the land in 2006 in Icheon City, South Korea, for
approximately $14.3 million. The refurbishment of 145,671 square feet for test operations and
of 34,209 square feet for dormitories were completed and the test line was moved to this
premises in August 2007. Our prior plans to refurbish an additional 20,031 square feet for
test operation, office and warehousing space have been cancelled as part of our cost control
measures in response to the weakening global economy.(6)
    
    STATS ChipPAC Taiwan Semiconductor Corporation owns the land and building, which are subject
to mortgages and certain other security interests.(7)
    
    We own the building and improvements and lease the land from the Federal Government of
Malaysia, but the land and all buildings on the land will revert to the lessor upon the
expiration of the long-term lease in 2086.(8)
    
    We own the land and building.(9)
    
    Situated within the campus of Conexant Systems Inc. 
 ITEM 4A. UNRESOLVED STAFF COMMENTS
  
 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
  Overview
   47




---



##### Table of Contents



Global Market Conditions
   Proposed Capital Reduction and Cash Distribution
    Temaseks Subsidiary, STSPLs, Tender Offer
    48




---



##### Table of Contents



Factors Affecting Our Results of Operations
 Cyclicality of the Semiconductor Industry.
  Declining Prices.
 Cost of Revenues.
  Capacity Utilization.
 49




---



##### Table of Contents



Goodwill and Intangible Assets.
  
    
    longer than expected slow-down in the industry beginning late 2004 as customers
corrected excess inventory position. This reduction in demand, coupled with the competitive
pressures in the testing and packaging business, affected our short-term earnings
expectation; and
    
    a revision of the industry outlook beyond 2005 compared to the time the merger was
announced.
    Critical Accounting Policies
  Revenue Recognition, Allowance For Doubtful Debts, Trade Discounts and Allowances and Sales
Returns
  50




---



##### Table of Contents



Valuation of Inventory
   Depreciation and Amortization
   Valuation of Property, Plant and Equipment
   51




---



##### Table of Contents



Deferred Tax Asset and Uncertain Income Tax Positions
     Valuation of Goodwill
   52




---



##### Table of Contents



Contingencies
   Results of Operations
  Year EndedDecember 31,
    
    December 30,
    
    December 28,2006
    
    2007
    
    2008Net revenuesPackaging laminate
    
    
    55.5
    %
    
    
    56.3
    %
    
    
    56.5
    %Packaging leaded
    
    
    18.3
    
    
    
    18.4
    
    
    
    18.0Test and other services
    
    
    26.2
    
    
    
    25.3
    
    
    
    25.5Total net revenues
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
  Year EndedDecember 31,
    
    December 30,
    
    December 28,2006
    
    2007
    
    2008Net revenues
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Gross profit
    
    
    20.2
    
    
    
    19.5
    
    
    
    16.5Selling, general and administrative
    
    
    8.6
    
    
    
    6.8
    
    
    
    7.1Research and development
    
    
    1.9
    
    
    
    2.1
    
    
    
    2.3Restructuring charges
    
    
    0.1
    
    
    
    0.1
    
    
    
    1.2Equipment impairment
    
    
    
    
    
    
    
    
    
    
    1.2Accelerated share-based compensation
    
    
    
    
    
    
    
    
    
    
    0.1Tender offer expenses
    
    
    
    
    
    
    0.7
    
    
    
    Held for sale asset impairment
    
    
    
    
    
    
    0.1
    
    
    
    Operating income
    
    
    9.6
    
    
    
    9.7
    
    
    
    4.6Other income (expense), net
    
    
    (2.6
    )
    
    
    (1.9
    )
    
    
    (1.6
    )Income tax expense
    
    
    (1.6
    )
    
    
    (1.8
    )
    
    
    (1.1
    )Minority interest
    
    
    (0.6
    )
    
    
    (0.3
    )
    
    
    (0.3
    )Net income
    
    
    4.8
    %
    
    
    5.7
    %
    
    
    1.6
    %
 53




---



##### Table of Contents



Year Ended December 28, 2008 Compared to Year Ended December 30, 2007
 Net Revenues
    Gross Profit
  Selling, General and Administrative
  Research and Development
  Equipment Impairment
  54




---



##### Table of Contents



Restructuring Expenses
   Accelerated Share-based Compensation
  Tender Offer Expenses
  Held for Sale Asset Impairment
  Net Interest Income (Expense)
   Foreign Currency Exchange Gain (Loss)
  Other Non-Operating Income (Expense), Net
  55




---



##### Table of Contents



Income Tax Expense
  Year Ended December 30, 2007 Compared to Year Ended December 31, 2006
 Net Revenues
    Gross Profit
  Selling, General and Administrative
  56




---



##### Table of Contents



Research and Development
  Held for Sale Asset Impairment
  Restructuring Charges
  Tender Offer Expenses
  Net Interest Income (Expense)
   Foreign Currency Exchange Gain (Loss)
  Other Non-Operating Income (Expense)
  Income Tax Expense
  57




---



##### Table of Contents



Quarterly Results
  Fiscal Quarter EndedApril 1,
    
    July 1,
    
    September 30,
    
    December 30,
    
    March 30,
    
    June 29,
    
    September 28,
    
    December 28,2007
    
    2007
    
    2007
    
    2007
    
    2008
    
    2008
    
    2008
    
    2008(In thousands)Net revenues
    
    $
    390,470
    
    
    $
    370,183
    
    
    $
    414,231
    
    
    $
    476,676
    
    
    $
    427,242
    
    
    $
    434,142
    
    
    $
    472,191
    
    
    $
    324,613Cost of revenues
    
    
    (312,911
    )
    
    
    (303,236
    )
    
    
    (330,337
    )
    
    
    (383,800
    )
    
    
    (352,704
    )
    
    
    (359,452
    )
    
    
    (384,829
    )
    
    
    (286,812
    )Gross profit
    
    
    77,559
    
    
    
    66,947
    
    
    
    83,894
    
    
    
    92,876
    
    
    
    74,538
    
    
    
    74,690
    
    
    
    87,362
    
    
    
    37,801Operating expenses:Selling, general and
administrative
    
    
    27,999
    
    
    
    28,036
    
    
    
    26,603
    
    
    
    29,955
    
    
    
    31,466
    
    
    
    28,616
    
    
    
    29,296
    
    
    
    28,959Research and development
    
    
    8,185
    
    
    
    8,985
    
    
    
    9,006
    
    
    
    8,742
    
    
    
    10,005
    
    
    
    9,279
    
    
    
    10,100
    
    
    
    8,441Restructuring charges
    
    
    
    
    
    
    990
    
    
    
    
    
    
    
    
    
    
    
    900
    
    
    
    
    
    
    
    5,130
    
    
    
    13,760Equipment impairment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,091
    
    
    
    Accelerated share-based
compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,562
    
    
    
    
    
    
    
    Tender offer expenses
    
    
    6,808
    
    
    
    4,114
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Held for sale asset impairment
    
    
    
    
    
    
    1,725
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total operating expenses
    
    
    42,992
    
    
    
    43,850
    
    
    
    35,609
    
    
    
    38,697
    
    
    
    42,371
    
    
    
    39,457
    
    
    
    65,617
    
    
    
    51,160Operating income (loss)
    
    
    34,567
    
    
    
    23,097
    
    
    
    48,285
    
    
    
    54,179
    
    
    
    32,167
    
    
    
    35,233
    
    
    
    21,745
    
    
    
    (13,359
    )Other income (expenses), net:Interest income (expenses), net
    
    
    (8,627
    )
    
    
    (8,124
    )
    
    
    (7,708
    )
    
    
    (8,733
    )
    
    
    (9,107
    )
    
    
    (7,574
    )
    
    
    (6,755
    )
    
    
    (6,865
    )Foreign currency exchange gain
(loss)
    
    
    120
    
    
    
    (405
    )
    
    
    (93
    )
    
    
    2,865
    
    
    
    3,208
    
    
    
    2,053
    
    
    
    (380
    )
    
    
    366Equity income (loss) from
equity investee
    
    
    (253
    )
    
    
    177
    
    
    
    (113
    )
    
    
    291
    
    
    
    (136
    )
    
    
    125
    
    
    
    (392
    )
    
    
    (1,034
    )Other non-operating income
(expenses), net
    
    
    41
    
    
    
    (151
    )
    
    
    (328
    )
    
    
    (4
    )
    
    
    728
    
    
    
    578
    
    
    
    187
    
    
    
    (1,466
    )Total other expenses, net
    
    
    (8,719
    )
    
    
    (8,503
    )
    
    
    (8,242
    )
    
    
    (5,581
    )
    
    
    (5,307
    )
    
    
    (4,818
    )
    
    
    (7,340
    )
    
    
    (8,999
    )Income (loss) before income
taxes
    
    
    25,848
    
    
    
    14,594
    
    
    
    40,043
    
    
    
    48,598
    
    
    
    26,860
    
    
    
    30,415
    
    
    
    14,405
    
    
    
    (22,358
    )Income tax benefit (expense)
    
    
    (7,651
    )
    
    
    (5,782
    )
    
    
    (10,812
    )
    
    
    (5,336
    )
    
    
    (7,620
    )
    
    
    (7,009
    )
    
    
    (4,921
    )
    
    
    378Income (loss) before minority
interest
    
    
    18,197
    
    
    
    8,812
    
    
    
    29,231
    
    
    
    43,262
    
    
    
    19,240
    
    
    
    23,406
    
    
    
    9,484
    
    
    
    (21,980
    )Minority interest
    
    
    (1,150
    )
    
    
    (1,383
    )
    
    
    (1,369
    )
    
    
    (1,916
    )
    
    
    (1,387
    )
    
    
    (1,290
    )
    
    
    (1,602
    )
    
    
    (169
    )Net income (loss)
    
    $
    17,047
    
    
    $
    7,429
    
    
    $
    27,862
    
    
    $
    41,346
    
    
    $
    17,853
    
    
    $
    22,116
    
    
    $
    7,882
    
    
    $
    (22,149
    )
 Fiscal Quarter Ended(As a Percentage of Net Revenues)April 1,
    
    July 1,
    
    September 30,
    
    December 30,
    
    March 30,
    
    June 29,
    
    September 28,
    
    December 28,2007
    
    2007
    
    2007
    
    2007
    
    2008
    
    2008
    
    2008
    
    2008Net revenues
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of revenues
    
    
    (80.1
    )
    
    
    (81.9
    )
    
    
    (79.7
    )
    
    
    (80.5
    )
    
    
    (82.6
    )
    
    
    (82.8
    )
    
    
    (81.5
    )
    
    
    (88.4
    )Gross profit
    
    
    19.9
    
    
    
    18.1
    
    
    
    20.3
    
    
    
    19.5
    
    
    
    17.4
    
    
    
    17.2
    
    
    
    18.5
    
    
    
    11.6Operating expenses:Selling, general and
administrative
    
    
    7.2
    
    
    
    7.6
    
    
    
    6.4
    
    
    
    6.3
    
    
    
    7.4
    
    
    
    6.6
    
    
    
    6.2
    
    
    
    8.9Research and development
    
    
    2.1
    
    
    
    2.4
    
    
    
    2.2
    
    
    
    1.8
    
    
    
    2.3
    
    
    
    2.1
    
    
    
    2.1
    
    
    
    2.6Equipment impairment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4.5
    
    
    
    Restructuring charges
    
    
    
    
    
    
    0.3
    
    
    
    0.0
    
    
    
    
    
    
    
    0.2
    
    
    
    
    
    
    
    1.1
    
    
    
    4.2
 58




---



##### Table of Contents



Fiscal Quarter Ended(As a Percentage of Net Revenues)April 1,
    
    July 1,
    
    September 30,
    
    December 30,
    
    March 30,
    
    June 29,
    
    September 28,
    
    December 28,2007
    
    2007
    
    2007
    
    2007
    
    2008
    
    2008
    
    2008
    
    2008Accelerated share-based
compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.4
    
    
    
    
    
    
    
    Tender offer expenses
    
    
    1.7
    
    
    
    1.1
    
    
    
    0.0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Held for sale asset impairment
    
    
    
    
    
    
    0.5
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total operating expenses
    
    
    11.0
    
    
    
    11.9
    
    
    
    8.6
    
    
    
    8.1
    
    
    
    9.9
    
    
    
    9.1
    
    
    
    13.9
    
    
    
    15.7Operating income
    
    
    8.9
    
    
    
    6.2
    
    
    
    11.7
    
    
    
    11.4
    
    
    
    7.5
    
    
    
    8.1
    
    
    
    4.6
    
    
    
    (4.1
    )Other income (expenses), net:Interest income (expenses) net
    
    
    (2.2
    )
    
    
    (2.2
    )
    
    
    (1.9
    )
    
    
    (1.8
    )
    
    
    (2.1
    )
    
    
    (1.7
    )
    
    
    (1.4
    )
    
    
    (2.1
    )Foreign currency exchange
gain (loss)
    
    
    0.0
    
    
    
    (0.1
    )
    
    
    (0.0
    )
    
    
    0.6
    
    
    
    0.8
    
    
    
    0.5
    
    
    
    (0.1
    )
    
    
    0.1Equity income (loss) from
investment in equity investee
    
    
    (0.1
    )
    
    
    0.0
    
    
    
    (0.0
    )
    
    
    0.1
    
    
    
    (0.0
    )
    
    
    0.0
    
    
    
    (0.1
    )
    
    
    (0.3
    )Other non-operating income
(expenses), net
    
    
    0.0
    
    
    
    0.0
    
    
    
    (0.1
    )
    
    
    0.0
    
    
    
    0.2
    
    
    
    0.1
    
    
    
    0.0
    
    
    
    (0.5
    )Total other income
(expenses), net
    
    
    (2.3
    )
    
    
    (2.3
    )
    
    
    (2.0
    )
    
    
    (1.1
    )
    
    
    (1.1
    )
    
    
    (1.1
    )
    
    
    (1.6
    )
    
    
    (2.8
    )Income before income taxes
    
    
    6.6
    
    
    
    3.9
    
    
    
    9.7
    
    
    
    10.3
    
    
    
    6.4
    
    
    
    7.0
    
    
    
    3.0
    
    
    
    (6.9
    )Income tax expense
    
    
    (2.0
    )
    
    
    (1.6
    )
    
    
    (2.6
    )
    
    
    (1.1
    )
    
    
    (1.8
    )
    
    
    (1.6
    )
    
    
    (1.0
    )
    
    
    0.1Income before minority interest
    
    
    4.6
    
    
    
    2.3
    
    
    
    7.1
    
    
    
    9.2
    
    
    
    4.6
    
    
    
    5.4
    
    
    
    2.0
    
    
    
    (6.8
    )Minority interest
    
    
    (0.3
    )
    
    
    (0.4
    )
    
    
    (0.3
    )
    
    
    (0.4
    )
    
    
    (0.3
    )
    
    
    (0.3
    )
    
    
    (0.3
    )
    
    
    (0.1
    )Net income
    
    
    4.3
    %
    
    
    1.9
    %
    
    
    6.8
    %
    
    
    8.8
    %
    
    
    4.3
    %
    
    
    5.1
    %
    
    
    1.7
    %
    
    
    (6.9
    )%
 Liquidity and Capital Resources
     59




---



##### Table of Contents



Total Borrowings
     60




---



##### Table of Contents



61




---



##### Table of Contents



Off-Balance Sheet Arrangements
  Contractual Obligations
  Payments DueWithin
    
    
    
    
    
    
    
    
    
    
    More Than1 Year
    
    
    1-3 Years
    
    
    3-5 Years
    
    
    5 Years
    
    
    Total(In thousands)On balance sheet commitments:6.75% senior notes due 2011 (1)
    
    $
    
    
    
    $
    215,000
    
    
    $
    
    
    
    $
    
    
    
    $
    215,0007.5% senior notes due 2010 (1)
    
    
    
    
    
    
    150,000
    
    
    
    
    
    
    
    
    
    
    
    150,0006% promissory note (1)
    
    
    10,000
    
    
    
    16,800
    
    
    
    
    
    
    
    
    
    
    
    26,800Long-term loans (1)
    
    
    16,953
    
    
    
    13,927
    
    
    
    773
    
    
    
    
    
    
    
    31,653Short-term loans (1)
    
    
    50,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    50,000Retirement benefits
    
    
    177
    
    
    
    545
    
    
    
    848
    
    
    
    7,250
    
    
    
    8,820Other non-current liabilities (2)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total on balance sheet commitments
    
    $
    77,130
    
    
    $
    396,272
    
    
    $
    1,621
    
    
    $
    7,250
    
    
    $
    482,273Off-balance sheet commitments:Operating leases
    
    $
    12,610
    
    
    $
    19,755
    
    
    $
    16,685
    
    
    $
    27,115
    
    
    $
    76,165Royalty/licensing agreements
    
    
    6,286
    
    
    
    12,455
    
    
    
    11,898
    
    
    
    
    
    
    
    30,639Purchase obligations: Capital commitments
    
    
    35,709
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    35,709 Inventory purchase commitments
    
    
    27,848
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,848Total off-balance sheet commitments
    
    $
    82,453
    
    
    $
    32,210
    
    
    $
    28,583
    
    
    $
    27,115
    
    
    $
    170,361Total commitments
    
    $
    159,583
    
    
    $
    428,482
    
    
    $
    30,204
    
    
    $
    34,365
    
    
    $
    652,634
 
 Notes:(1)
    
    Our senior notes, promissory note payable, short-term and long-term loans agreements contain
provisions for the payment of interest either on a monthly, quarterly, semi-annual or annual
basis at a stated rate of interest over the term of the debt. These payment obligations are
not reflected in the table above. The interest payments due within one year, 1-3 years and
3-5 years amount to $28.0 million, $41.8 million and $0.01 million, respectively.(2)
    
    Our other non-current liabilities as of December 28, 2008 were $64.1 million, including $8.8
million related to retirement and severance benefits for our employees in Malaysia and
Thailand, respectively. Also included in the other non-current liabilities is $13.9 million
related to severance benefits for our employees in South Korea which were not included in the
table due to lack of contractual certainty as to the timing of payments. Further, included in
the other non-current liabilities as of December 28, 2008 was $7.5 million of liability for
uncertain tax positions under Financial Accounting Standards Board
(FASB) Interpretations 48. We are unable to reasonably estimate the timing of the amount, therefore, the liability is
excluded from the table. 62




---



##### Table of Contents



Contingencies
         63




---



##### Table of Contents



Cash Flows From Operating Activities
     64




---



##### Table of Contents



Cash Flows From Investing Activities
   Cash Flows From Financing Activities
   Special Tax Status
  65




---



##### Table of Contents



Derivative Financial Instruments
   Foreign Currency Risk
   Research and Development
  Recent Accounting Pronouncements
   66




---



##### Table of Contents



67




---



##### Table of Contents



ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
 A. Directors and Senior Management
  Name
    
    Age
    
    PositionBoard of DirectorsCharles R. Wofford(1)(2)(3)(4)
    
    
    75
    
    
    Chairman of our Board of DirectorsTan Lay Koon
    
    
    50
    
    
    Director, President and Chief Executive OfficerPeter Seah Lim Huat(5)(6)
    
    
    62
    
    
    DirectorR. Douglas Norby(1)(5)(7)
    
    
    73
    
    
    DirectorTeng Cheong Kwee(1)(6)(8)(9)
    
    
    55
    
    
    DirectorTokumasa Yasui(1)(9)
    
    
    64
    
    
    DirectorPhoon Siew Heng(8)
    
    
    45
    
    
    DirectorSenior ManagementWan Choong Hoe
    
    
    55
    
    
    Executive Vice President, Chief Operating OfficerHan Byung Joon
    
    
    49
    
    
    Executive Vice President, Chief Technology OfficerHal Lasky (10)
    
    
    46
    
    
    Executive Vice President, Chief Sales OfficerJohn Lau Tai Chong
    
    
    49
    
    
    Senior Vice President, Chief Financial OfficerJanet T. Taylor
    
    
    51
    
    
    Senior Vice President, General Counsel
 
 Notes:(1)
    
    Determined by our Board of Directors to be independent for the purposes of the Singapore Code
of Corporate Governance 2005.(2)
    
    Chairman of the Executive Committee.(3)
    
    Chairman of the Executive Resource and Compensation Committee.(4)
    
    Chairman of the Nominating and Corporate Governance Committee.(5)
    
    Member of the Executive Resource and Compensation Committee.(6)
    
    Member of the Nominating and Corporate Governance Committee.(7)
    
    Chairman of the Audit Committee.(8)
    
    Member of the Executive Committee.(9)
    
    Member of the Audit Committee.(10)
    
    Appointed with effect from March 27, 2008.    68




---



##### Table of Contents



Board of Directors
 Charles R. Wofford
  Tan Lay Koon
  Peter Seah Lim Huat
 Bintang Bakti Masyarakat
 R. Douglas Norby
  Teng Cheong Kwee
  69




---



##### Table of Contents



Tokumasa Yasui
  Phoon Siew Heng
  Senior Management
 Wan Choong Hoe
  Han Byung Joon
  Hal Lasky
  70




---



##### Table of Contents



John Lau Tai Chong
  Janet T. Taylor
  B. Compensation
 Compensation of Directors and Senior Management
  Executive
    
    
    Non-executiveDirector
    
    

Directors (1)
    
    

Total (2)Charles R. Wofford
    
    
    
    
    
    $
    132,000
    
    
    $
    132,000Tan Lay Koon
    
    $
    1,767,252
    
    
    
    
    
    
    
    1,767,252Peter Seah Lim Huat
    
    
    
    
    
    
    46,000
    
    
    
    46,000R. Douglas Norby
    
    
    
    
    
    
    69,000
    
    
    
    69,000Teng Cheong Kwee
    
    
    
    
    
    
    56,000
    
    
    
    56,000Tokumasa Yasui
    
    
    
    
    
    
    58,000
    
    
    
    58,000Phoon Siew Heng
    
    
    
    
    
    
    44,000
    (3)
    
    
    44,000
    (3)Senior management (excluding our Chief Executive Officer) as a group
    
    
    
    
    
    
    
    
    
    
    2,946,638$
    1,767,252
    
    
    $
    405,000
    
    
    $
    5,118,890
 
 Notes:(1)
    
    We have sought advance approval, at our annual general meeting in April 2008, for the payment
of directors fees of approximately $518,000 for 2008.(2)
    
    Does not include compensation given in the form of share options and restricted share units.
For more information on share options and restricted share units granted to our directors and
senior management, see  E. Share Ownership for Directors and Senior Management. Includes
$98,175 representing payment of one-third of the notional Economic Value Added (EVA) bank
account. See discussion below.(3)
    
    Including the amount paid directly to Temasek during
Mr. Phoon Siew Hengs employment at Temasek.  71




---



##### Table of Contents



Pension, Retirement or Similar Benefits
   72




---



##### Table of Contents



73




---



##### Table of Contents



C. Board Practices
 Board of Directors
      Committees of our Board of Directors
 Audit Committee
    74




---



##### Table of Contents



Executive Resource and Compensation Committee
       
    
    consider, review, vary and approve our Companys policy for determining executive
remuneration including the remuneration policy with regard to Senior Management Executives;
    
    consider, review, vary (if necessary) and approve the entire specific remuneration
package and service contract terms for each Senior Management Executive;
    
    review and approve all of our option plans, stock plans and other equity-based plans;
    
    review and make recommendations to the Board with regard to each award to Senior
Management Executives under each equity based plan;
    
    review and approve each award as well as the total proposed awards under each equity
based plan in accordance with the rules governing each such plan, including awards to
directors; and
    
    approve the remuneration framework, including directors fees for our non-executive
directors.
  Executive Committee
    75




---



##### Table of Contents



Nominating and Corporate Governance Committee
   
    
    The Nominating and Corporate Governance Committee comprises not less than three
directors, the majority of whom, including the Chairman, qualify as independent directors
under the Singapore Code of Corporate Governance 2005. Our Board of Directors has
determined that Mr. Charles R. Wofford and Mr. Teng Cheong Kwee are independent directors
under the Singapore Code of Corporate Governance 2005.
    
    The Nominating and Corporate Governance Committees duties and responsibilities include
the following:
 (i)
    
    the identification of qualified candidates to become members of our Board of
Directors;(ii)
    
    the selection of nominees for election as directors at the next annual meeting of
shareholders (or extraordinary general meeting of shareholders at which directors are to
be elected);(iii)
    
    the selection of candidates to fill any vacancies on our Board of Directors;(iv)
    
    the development and recommendation to our Board of Directors of a set of
corporate governance guidelines and principles applicable to our Company (being our Code
of Business Conduct and Ethics); and(v)
    
    the oversight of the evaluation of our Board of Directors and its committees.
  D. Employees
     December 31,
    
    December 30,
    
    December 28,
    
    February 12,2006
    
    2007
    
    2008
    
    2009Function:Direct and indirect labor (manufacturing)
    
    
    13,181
    
    
    
    13,764
    
    
    
    12,096
    
    
    
    10,672Indirect labor (administration)
    
    
    770
    
    
    
    809
    
    
    
    669
    
    
    
    636Research and development
    
    
    260
    
    
    
    300
    
    
    
    293
    
    
    
    285
 76




---



##### Table of Contents



December 31,
    
    December 30,
    
    December 28,
    
    February 12,2006
    
    2007
    
    2008
    
    2009Total
    
    
    14,211
    
    
    
    14,873
    
    
    
    13,058
    
    
    
    11,593Location:Singapore
    
    
    3,527
    
    
    
    3,288
    
    
    
    3,032
    
    
    
    2,226China
    
    
    4,241
    
    
    
    3,829
    
    
    
    3,456
    
    
    
    3,209Malaysia
    
    
    3,007
    
    
    
    2,900
    
    
    
    1,870
    
    
    
    1,558South Korea
    
    
    2,513
    
    
    
    2,698
    
    
    
    2,618
    
    
    
    2,613Taiwan
    
    
    645
    
    
    
    590
    
    
    
    580
    
    
    
    527Thailand
    
    
    
    
    
    
    1,296
    
    
    
    1,288
    
    
    
    1,261United States
    
    
    262
    
    
    
    252
    
    
    
    199
    
    
    
    185Others
    
    
    16
    
    
    
    20
    
    
    
    15
    
    
    
    14Total
    
    
    14,211
    
    
    
    14,873
    
    
    
    13,058
    
    
    
    11,593
 E. Share Ownership for Directors and Senior Management
    Share Options for Directors
  Number of Ordinary Shares
    
    Per Share ExerciseIssuable on Exercise of Option
    
    Price (S$)
    
    Exercisable PeriodTan Lay Koon
    
    
    700,000
    
    
    
    2.826
    
    
    10/19/2001 to 10/18/2010325,000
    
    
    
    2.885
    
    
    04/29/2003 to 04/28/20122,000,000
    
    
    
    2.2
    
    
    06/26/2003 to 06/25/2012700,000
    
    
    
    1.99
    
    
    08/06/2004 to 08/05/2013500,000
    
    
    
    1.91
    
    
    02/17/2005 to 02/16/2014Peter Seah Lim Huat
    
    
    70,000
    
    
    
    1.99
    
    
    08/06/2004 to 08/05/201335,000
    
    
    
    1.91
    
    
    02/17/2005 to 02/16/2014Teng Cheong Kwee
    
    
    35,000
    
    
    
    1.91
    
    
    02/17/2005 to 02/16/2009
 Employees Share Ownership Schemes
   77




---



##### Table of Contents



STATS ChipPAC Ltd. Restricted Share Plan
        STATS ChipPAC Ltd. Employee Share Purchase Plan 2004
    78




---



##### Table of Contents



STATS ChipPAC Ltd. Substitute Share Purchase and Option Plan (the Substitute Option Plan) and
STATS ChipPAC Ltd. Substitute Equity Incentive Plan (the Substitute EIP, and together with the
Substitute Option Plan, the Substitute Plans)
   STATS ChipPAC Share Option Plan, as amended
        79




---



##### Table of Contents



ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
 A. Major Shareholders
   
    
    the election of directors;
    
    the merger or consolidation of us with any other entity;
    
    any sale of all or substantially all of our assets; and
    
    the timing and payment of dividends.
  Number of Shares
    
    PercentageName of Beneficial Owner
    
    Beneficially Owned
    
    Beneficially OwnedTemasek(1)
    
    
    1,845,715,689
    
    
    
    83.8
    %
 
 (1)
    
    As notified to our Company by Temasek, a private limited company incorporated in Singapore,
wholly-owned by the Minister for Finance (Incorporated) of Singapore, a body corporate
constituted by the Minister for Finance (Incorporation) Act (Cap. 183), which owns 100% of the
ordinary shares of STSPL. Temasek is therefore deemed to beneficially own 1,845,715,689 of our
ordinary shares, which are owned directly by STSPL. The percentage beneficially owned is based
on an aggregate 2,202,218,293 ordinary shares outstanding as of January 31, 2009.  
    
    Prior to the tender offer by STSPL in March 2007, Temasek beneficially owned, and its
wholly-owned subsidiary, STSPL, directly owned, approximately 712,228,050 ordinary shares,
which represented approximately 35.6% of our outstanding ordinary shares at that time. Upon
the consummation of the tender offer in May 2007, Temasek beneficially owned, and STSPL
directly owned, 1,838,819,759 ordinary shares (including ordinary shares represented by
ADSs and ordinary shares issuable upon conversion of the $134.5 million aggregate principal
amount of our 2.5% convertible notes acquired by STSPL in the tender offer), which
represented approximately 84.2% of our outstanding ordinary shares at that time. On May 22,
2008, STSPL converted into 145.1 million ordinary shares its entire $134.5 million of our
2.5% convertible notes that it acquired in connection with its tender offer in 2007. See
Item 4. Information on the Company  A. History and Development of our Company.
  80




---



##### Table of Contents



B. Related Party Transactions
       81




---



##### Table of Contents



C. Interest of Experts and Counsel
  
 ITEM 8. FINANCIAL INFORMATION
 A. Consolidated Statements and Other Financial Information
  Legal Proceedings
     82




---



##### Table of Contents



Dividend Policy
  B. Significant Changes
  
 ITEM 9. THE OFFER AND LISTING
 A. Offer and Listing Details
 Price range of our ordinary shares
  Price perOrdinary Shareon the SGX-ST(in S$)High
    
    LowAnnual for 2004
    
    
    2.45
    
    
    
    0.92Annual for 2005
    
    
    1.34
    
    
    
    0.88Annual for 2006
    
    
    1.42
    
    
    
    0.84Annual for 2007
    
    
    1.88
    
    
    
    1.14Annual for 2008
    
    
    1.60
    
    
    
    0.42Quarterly highs and lows: quarter ended April 1, 2007
    
    
    1.84
    
    
    
    1.14 quarter ended July 1, 2007
    
    
    1.88
    
    
    
    1.58 quarter ended September 30, 2007
    
    
    1.75
    
    
    
    1.45 quarter ended December 30, 2007
    
    
    1.71
    
    
    
    1.48 quarter ended March 30, 2008
    
    
    1.60
    
    
    
    1.10 quarter ended June 29, 2008
    
    
    1.35
    
    
    
    1.12 quarter ended September 28, 2008
    
    
    1.17
    
    
    
    0.82 quarter ended December 28, 2008
    
    
    0.92
    
    
    
    0.40
 83




---



##### Table of Contents



Price perOrdinary Shareon the SGX-ST(in S$)High
    
    LowMonthly highs and lows:August 2008
    
    
    1.02
    
    
    
    0.86September 2008
    
    
    1.05
    
    
    
    0.60October 2008
    
    
    0.92
    
    
    
    0.40November 2008
    
    
    0.58
    
    
    
    0.41December 2008
    
    
    0.58
    
    
    
    0.41January 2009
    
    
    0.53
    
    
    
    0.40February 2009
    
    
    0.46
    
    
    
    0.32
 B. Plan of Distribution
  C. Markets
  D. Selling Shareholders
  E. Dilution
  F. Expenses of the Issue
  
 ITEM 10. ADDITIONAL INFORMATION
 A. Share Capital
  B. Memorandum and Articles of Association
  Objects
   84




---



##### Table of Contents



Board of Directors
       Ordinary Shares
     85




---



##### Table of Contents



New Ordinary Shares
  Shareholders
  Transfer of Ordinary Shares
  General Meetings of Shareholders
  Voting Rights
  86




---



##### Table of Contents



Dividends
  Bonus and Rights Issue
  Take-Overs
   87




---



##### Table of Contents



Liquidation or Other Return of Capital
  Indemnity
  Limitations on Rights to Hold or Vote Shares
  Substantial Shareholdings
    Minority Rights
  88




---



##### Table of Contents



C. Material Contracts
      89




---



##### Table of Contents



90




---



##### Table of Contents



91




---



##### Table of Contents



92




---



##### Table of Contents



D. Exchange Controls
  Exchange Rates
   Singapore Dollars per US$1.00 Closing RateAverage (1)
    
    Low
    
    High
    
    Period EndFiscal Year2004
    
    
    1.69
    
    
    
    1.63
    
    
    
    1.73
    
    
    
    1.632005
    
    
    1.66
    
    
    
    1.62
    
    
    
    1.71
    
    
    
    1.672006
    
    
    1.58
    
    
    
    1.53
    
    
    
    1.67
    
    
    
    1.532007
    
    
    1.51
    
    
    
    1.44
    
    
    
    1.54
    
    
    
    1.442008
    
    
    1.41
    
    
    
    1.35
    
    
    
    1.53
    
    
    
    1.45
 
 Note:(1)
    
    The average of the daily noon buying rates, for fiscal year
2004 to 2007 and daily closing rates for fiscal year 2008 on the last business day of each month during the
year. 93




---



##### Table of Contents



Singapore Dollars per US$1.00 Closing RateAverage (1)
    
    Low
    
    High
    
    Period EndMonthAugust 2008
    
    
    1.41
    
    
    
    1.37
    
    
    
    1.43
    
    
    
    1.42September 2008
    
    
    1.43
    
    
    
    1.42
    
    
    
    1.44
    
    
    
    1.44October 2008
    
    
    1.48
    
    
    
    1.44
    
    
    
    1.51
    
    
    
    1.48November 2008
    
    
    1.51
    
    
    
    1.48
    
    
    
    1.53
    
    
    
    1.51December 2008
    
    
    1.48
    
    
    
    1.44
    
    
    
    1.53
    
    
    
    1.43January 2009
    
    
    1.49
    
    
    
    1.44
    
    
    
    1.51
    
    
    
    1.51February 2009
    
    
    1.52
    
    
    
    1.49
    
    
    
    1.55
    
    
    
    1.55
 
 Note:(1)
    
    The average of the daily closing rates on each business day during the month.  E. Taxation
 Singapore Taxation
  Income Tax
   94




---



##### Table of Contents



Dividend Distributions
   Tax on Capital Gains
   Stamp Duty
   Estate Duty
  95




---



##### Table of Contents



United States Federal Income Taxation
  Distributions on Ordinary Shares
     Sale or Exchange of the Ordinary Shares
  96




---



##### Table of Contents



Passive Foreign Investment Company
    
    
    The excess distribution or gain will be allocated ratably over the U.S. Holders holding
period for the ordinary shares;
    
    The amount allocated to the current taxable year, and any taxable year in the U.S.
Holders holding period prior to the first taxable year in which we became a PFIC, will be
treated as ordinary income; and
    
    The amount allocated to each other year will be subject to the highest tax rate in
effect for that year and the interest charge generally applicable to underpayments of tax
will be imposed on the resulting tax attributable to each such year.
  de minimis
 United States Information Reporting and Backup Withholding
   97




---



##### Table of Contents



F. Dividends and Paying Agents
  G. Statements by Experts
  H. Documents on Display
  I. Subsidiary Information
  
 ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  Investment and Interest Rates
  Currency Exchange Rates
    98




---



##### Table of Contents



Commodity Price
  Limitations
  
 ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
  
 ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
  
 ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
  
 ITEM 15. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
   99




---



##### Table of Contents



Managements Annual Report on Internal Control over Financial Reporting
   
    
    pertain to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of our assets;
    
    provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting
principles, and that our receipts and expenditures are being made only in accordance with
authorizations of our management and members of our Board of Directors; and
    
    provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of our assets that could have a material effect on our
financial statements.
     Changes to Internal Controls
  
 ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
  
 ITEM 16B. CODE OF ETHICS
  100




---



##### Table of Contents



ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
    Year EndedDecember 30,
    
    
    December 28,2007
    
    
    2008Audit fees
    
    $
    2,239
    
    
    $
    1,679Audit-related fees
    
    
    126
    
    
    
    227Tax fees
    
    
    85
    
    
    
    104All other fees
    
    
    
    
    
    
    Total
    
    $
    2,450
    
    
    $
    2,010
 Audit Fees.
 Audit-Related Fees.
 101




---



##### Table of Contents



Tax Fees.
 All Other Fees.
 Audit Committee Pre-approval Process
 de
minimus
 
 ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEE
  
 ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
  
 ITEM 16F. CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT
  
 ITEM 16G. CORPORATE GOVERNANCE
  
 ITEM 17. FINANCIAL STATEMENTS
  
 ITEM 18. FINANCIAL STATEMENTS
        
 ITEM 19. EXHIBITS
  102




---



##### Table of Contents



1.1
    
    Memorandum of Association of STATS ChipPAC Ltd.  incorporated by reference to Exhibit
1.1 of Form 20-F (File No. 000-29103) of STATS ChipPAC Ltd., as filed with the Securities
and Exchange Commission on March 12, 20071.2.
    
    Amended Articles of Association of STATS ChipPAC Ltd.  incorporated by reference to
Exhibit 2 of Amendment No. 2 to the Registration Statement on Form 8-A (File No.
000-29103) of STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on
May 9, 20062.1
    
    Specimen ordinary share certificate of STATS ChipPAC Ltd. issued on and after January 30,
2006 in respect of transfers of shares issued before January 30, 2006  incorporated by
reference to Exhibit 3.1 of Amendment No. 2 to the Registration Statement on Form 8-A
(File No. 000-29103) of STATS ChipPAC Ltd., as filed with the Securities and Exchange
Commission on May 9, 20062.1.1
    
    Specimen ordinary share certificate of STATS ChipPAC Ltd. issued on and after January 30,
2006 in respect of new issuances of shares issued after January 30, 2006  incorporated
by reference to Exhibit 3.2 of Amendment No. 2 to the Registration Statement on Form 8-A
(File No. 000-29103) of STATS ChipPAC Ltd., as filed with the Securities and Exchange
Commission on May 9, 20064.1
    
    Lease Agreement dated November 18, 1996 by and between the Housing and Development Board
and ST Assembly Test Services Pte Ltd  incorporated by reference to Exhibit 10.4 of
Amendment No. 1 to Form F-1 (File No. 333-93661) of ST Assembly Test Services Ltd, as
filed with the Securities and Exchange Commission on January 3, 20004.2#
    
    Amendment Agreement dated April 22, 2003 renewing the Immunity Agreement dated October 18,
1996 by and between Motorola Inc. and ST Assembly Test Services Pte Ltd  incorporated by
reference to Exhibit 4.12 of Form 20-F (File No. 333-75080) of ST Assembly Test Services
Ltd, as filed with the Securities and Exchange Commission on March 19, 20044.3
    
    Second Amendment to Immunity Agreement dated September 19, 2006 amending the Immunity
Agreement dated October 18, 1996, as amended April 22, 2003 by and between Freescale
Semiconductor, Inc. and STATS ChipPAC, Ltd.  incorporated by reference to Exhibit 4.6 of
Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as filed with the Securities and
Exchange Commission on March 7, 20084.4
    
    Strategic Assistance Loan Agreement dated June 20, 2003 by and between ST Assembly Test
Services Ltd and Simmtech Co. Ltd  incorporated by reference to Exhibit 4.16 of Form
20-F (File No. 333-75080) of ST Assembly Test Services Ltd, as filed with the Securities
and Exchange Commission on March 19, 20044.5
    
    Yangdo Tambo Agreement dated June 20, 2003 by and between ST Assembly Test Services Ltd
and Simmtech Co. Ltd  incorporated by reference to Exhibit 4.17 of Form 20-F (File No.
333-75080) of ST Assembly Test Services Ltd, as filed with the Securities and Exchange
Commission on March 19, 20044.6
    
    Pledge Agreement dated June 20, 2003 by and between ST Assembly Test Services Ltd and
Simmtech Co. Ltd  incorporated by reference to Exhibit 4.18 of Form 20-F (File No.
333-75080) of ST Assembly Test Services Ltd, as filed with the Securities and Exchange
Commission on March 19, 20044.7
    
    Loan Agreement dated December 26, 2003 by and among ST Assembly Test Services Ltd,
Simmtech Co. Ltd and Mr. Se-Ho Chun  incorporated by reference to Exhibit 4.19 of Form
20-F (File No. 333-75080) of ST Assembly Test Services Ltd, as filed with the Securities
and Exchange Commission on March 19, 20044.8
    
    Yangdo Tambo Agreement dated December 26, 2003 by and between ST Assembly Test Services
Ltd and Simmtech Co. Ltd  incorporated by reference to Exhibit 4.20 of Form 20-F (File
No. 333-75080) of ST Assembly Test Services Ltd, as filed with the Securities and Exchange
Commission on March 19, 20044.9
    
    Share Pledge Agreement dated December 26, 2003 by and between ST Assembly Test Services
Ltd and Mr. Se-Ho Chun  incorporated by reference to Exhibit 4.21 of Form 20-F (File No.
333-75080) of ST Assembly Test Services Ltd, as filed with the Securities and Exchange
Commission on March 19, 20044.10
    
    Factory Kun-Mortgage Agreement dated December 26, 2003 by and between ST Assembly Test
Services Ltd and Simmtech Co. Ltd  incorporated by reference to Exhibit 4.22 of Form
20-F (File No. 333-75080) of ST Assembly Test Services Ltd, as filed with the Securities
and Exchange Commission on March 19, 20044.11
    
    Base Capacity and Continuing Support Agreement dated December 26, 2003 by and between ST
Assembly Test Services Ltd and Simmtech Co. Ltd  incorporated by reference to Exhibit
4.23 of Form 20-F (File No. 333-75080)
 103




---



##### Table of Contents



of ST Assembly Test Services Ltd, as filed with the
Securities and Exchange Commission on March 19, 20044.12
    
    Indenture dated November 18, 2004 by and between STATS ChipPAC Ltd. and U.S. Bank National
Association relating to the 6.75% Senior Notes Due 2011  incorporated by reference to
Exhibit 4.40 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as filed with the
Securities and Exchange Commission on March 18, 20054.13
    
    Subsidiary Guarantee Agreement dated November 18, 2004 among STATS ChipPAC Ltd., the
Subsidiary Guarantors party thereto and U.S. Bank National Association relating to the
6.75% Senior Notes Due 2011  incorporated by reference to Exhibit 4.43 of Form 20-F
(File No. 333-75080) of STATS ChipPAC Ltd., as filed with the Securities and Exchange
Commission on March 18, 20054.14
    
    Supplemental Subsidiary Guarantee Agreement dated as of February 21, 2006 among STATS
ChipPAC Ltd., the Subsidiary Guarantors party thereto and U.S. Bank National Association
with respect to the 6.75% Senior Notes Due 2011  incorporated by reference to Exhibit
4.49 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as filed with the Securities
and Exchange Commission on February 28, 20064.15
    
    Supplemental Subsidiary Guarantee Agreement dated as of September 18, 2007 among STATS
ChipPAC Ltd., the Subsidiary Guarantors party thereto and U.S. Bank National Association
with respect to the 6.75% Senior Notes due 2011  incorporated by reference to Exhibit
4.24 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as filed with the Securities
and Exchange Commission on March 7, 20084.16
    
    Indenture dated as of July 19, 2005 by and between STATS ChipPAC Ltd. and U.S. Bank
National Association relating to the 7.5% Senior Notes Due 2010  incorporated by
reference to Exhibit 4.1 of Form 6-K (File No. 333-75080) of STATS ChipPAC Ltd., as filed
with the Securities and Exchange Commission on August 25, 20054.17
    
    Subsidiary Guarantee Agreement dated as of July 19, 2005 among STATS ChipPAC Ltd., the
Subsidiary Guarantors party thereto and U.S. Bank National Association relating to the
7.5% Senior Notes Due 2010  incorporated by reference to Exhibit 4.3 of Form 6-K (File
No. 333-75080) of STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission
on August 25, 20054.18
    
    Supplemental Subsidiary Guarantee Agreement dated as of February 21, 2006 among STATS
ChipPAC Ltd., the Subsidiary Guarantors party thereto and U.S. Bank National Association
with respect to the 7.5% Senior Notes Due 2010  incorporated by reference to Exhibit
4.48 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as filed with the Securities
and Exchange Commission on February 28, 20064.19
    
    Supplemental Subsidiary Guarantee Agreement dated as of September 18, 2007 among STATS
ChipPAC Ltd., the Subsidiary Guarantors party thereto and U.S. Bank National Association
with respect to the 7.5% Senior Notes Due 2010  incorporated by reference to Exhibit
4.28 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as filed with the Securities
and Exchange Commission on March 7, 20084.20
    
    STATS ChipPAC Ltd. Substitute Equity Incentive Plan  incorporated by reference to
Exhibit 4.4 to Post-Effective Amendment No. 1 on Form S-8 (File No. 333-114232) of STATS
ChipPAC Ltd., as filed with the Securities and Exchange Commission on August 25, 20044.21
    
    STATS ChipPAC Ltd. Substitute Share Purchase and Option Plan  incorporated by reference
to Exhibit 4.5 to Post-Effective Amendment No. 1 on Form S-8 (File No. 333-114232) of
STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on August 25,
20044.22
    
    STATS ChipPAC Ltd. Share Option Plan  incorporated by reference to Exhibit 4.28 of Form
20-F (File No. 000-29103) of STATS ChipPAC Ltd., as filed with the Securities and Exchange
Commission on March 12, 20074.23
    
    STATS ChipPAC Ltd. Restricted Share Plan  incorporated by reference to Appendix 2 to
STATS ChipPAC Ltd.s Proxy Statement which was filed as Exhibit 99.1 on Form 6-K (File No.
333-75080) of STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on
March 30, 20064.24
    
    STATS ChipPAC Ltd. Performance Share Plan  incorporated by reference to Exhibit 4.30 of
Form 20-F (File No. 000-29103) of STATS ChipPAC Ltd., as filed with the Securities and
Exchange Commission on March 12, 20074.25
    
    Terms and Conditions of Appointment of Tan Lay Koon as President and Chief Executive
Officer of STATS ChipPAC Ltd. dated August 5, 2004 by and between Tan Lay Koon and STATS
ChipPAC Ltd. incorporated by reference to Exhibit 4.46 of Form 20-F (File No. 333-75080)
of STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on February
28, 2006
 104




---



##### Table of Contents



4.26
    
    Letter Amendment to Terms and Conditions of Appointment of Tan Lay Koon as President and
Chief Executive Officer of STATS ChipPAC Ltd. dated October 26, 2006  incorporated by
reference to Exhibit(e)(8) of Schedule 14D-9 (File No. 005-60763) of STATS ChipPAC Ltd.,
as filed with the Securities and Exchange Commission on March 30, 20074.27
    
    Letter Amendment to Terms and Conditions of Appointment of Tan Lay Koon as President and
Chief Executive Officer of STATS ChipPAC Ltd. dated October 26, 2007  incorporated by
reference to Exhibit 4.37 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as
filed with the Securities and Exchange Commission on March 7, 20084.28
    
    Subscription Agreement dated June 22, 2006 among STATS ChipPAC Ltd., China Resources Logic
Limited, Micro Assembly Technologies Limited and Wuxi China Resources Microelectronics
(Holdings) Limited  incorporated by reference to Exhibit 4.41 of Form 20-F (File No.
000-29103) of STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on
March 12, 20074.29
    
    Deed of Indemnity dated June 22, 2006 among STATS ChipPAC Ltd., China Resources Logic
Limited, Micro Assembly Technologies Limited and Wuxi China Resources Microelectronics
(Holdings) Limited  incorporated by reference to Exhibit 4.42 of Form 20-F (File No.
000-29103) of STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on
March 12, 20074.30
    
    Joint Venture Agreement dated June 22, 2006 among STATS ChipPAC Ltd., China Resources
Logic Limited, Wuxi China Resources Microelectronics (Holdings) Limited, Micro Assembly
Technologies Limited and Wuxi CR Micro-Assembly Technology Ltd.  incorporated by
reference to Exhibit 4.43 of Form 20-F (File No. 000-29103) of STATS ChipPAC Ltd., as
filed with the Securities and Exchange Commission on March 12, 20074.31
    
    Asset Sale and Purchase Agreement dated June 22, 2006 among STATS ChipPAC Shanghai Co.,
Ltd., STATS ChipPAC Ltd., Wuxi CR Micro-Assembly Technology Ltd. and China Resources Logic
Limited  incorporated by reference to Exhibit 4.44 of Form 20-F (File No. 000-29103) of
STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on March 12, 20074.32
    
    Amendment Number One dated July 14, 2006 to the Asset Sale and Purchase Agreement dated
June 22, 2006 among STATS ChipPAC Shanghai Co., Ltd., STATS ChipPAC Ltd., Wuxi CR
Micro-Assembly Technology Ltd. and China Resources Logic Limited  incorporated by
reference to Exhibit 4.45 of Form 20-F (File No. 000-29103) of STATS ChipPAC Ltd., as
filed with the Securities and Exchange Commission on March 12, 20074.33
    
    Manufacturers Representative Agreement dated June 22, 2006 among Wuxi CR Micro-Assembly
Technology Ltd., China Resources Logic Limited, STATS ChipPAC (BVI) Limited and STATS
ChipPAC Ltd.  incorporated by reference to Exhibit 4.46 of Form 20-F (File No.
000-29103) of STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on
March 12, 20074.34#
    
    English language translation of Korean language US$25,000,000 Term Loan Agreement dated
May 29, 2006 by and between STATS ChipPAC Korea Ltd. and Hana Bank  incorporated by
reference to Exhibit 4.48 of Form 20-F (File No. 000-29103) of STATS ChipPAC Ltd., as
filed with the Securities and Exchange Commission on March 12, 20074.35
    
    English language summary of Chinese language NT$1.8 Billion Syndicated Loan Agreement
dated March 2, 2004 by and between STATS ChipPAC Taiwan Semiconductor Corporation
(formerly known as Winstek Semiconductor Corporation) and Mega Bank Limited 
incorporated by reference to Exhibit 4.49 of Form 20-F (File No. 000-29103) of STATS
ChipPAC Ltd., as filed with the Securities and Exchange Commission on March 12, 20074.36
    
    English language summary of Chinese language NT$3.6 Billion Syndicated Loan Agreement
dated August 18, 2006 by and between STATS ChipPAC Taiwan Semiconductor Corporation
(formerly known as Winstek Semiconductor Corporation) and Taishin Bank Limited 
incorporated by reference to Exhibit 4.50 of Form 20-F (File No. 000-29103) of STATS
ChipPAC Ltd., as filed with the Securities and Exchange Commission on March 12, 20074.37
    
    Agreement for the Sale and Purchase of Assets dated April 23, 2007 by and between Schott
Advanced Packaging Singapore Pte Ltd. and STATS ChipPAC Ltd.  incorporated by reference
to Exhibit 4.48 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as filed with the
Securities and Exchange Commission on March 7, 20084.38
    
    Asset Sale and Purchase Agreement dated May 21, 2007 among STATS ChipPAC Malaysia Sdn.
Bhd. and Ningbo Mingxin Microelectronics Co. Ltd. and Daheng New Epoch Technology, Inc. 
incorporated by reference to Exhibit 4.49 of Form 20-F (File No. 333-75080) of STATS
ChipPAC Ltd., as filed with the Securities and Exchange
 105




---



##### Table of Contents



Commission on March 7, 20084.39
    
    Asset Purchase Agreement dated as of July 25, 2007, among STATS ChipPAC (Thailand)
Limited, STATS ChipPAC Ltd., LSI (Thai) Ltd. and LSI Corporation  incorporated by
reference to Exhibit 4.50 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as
filed with the Securities and Exchange Commission on March 7, 20084.40
    
    Amendment No. 1 dated October 2, 2007, to Asset Purchase Agreement, dated as of July 25,
2007, among STATS ChipPAC (Thailand) Limited, STATS ChipPAC Ltd., LSI (Thai) Ltd. and LSI
Corporation  incorporated by reference to Exhibit 4.51 of Form 20-F (File No. 333-75080)
of STATS ChipPAC Ltd., as filed with the Securities and Exchange Commission on March 7,
20084.41
    
    Promissory Note, dated October 2, 2007 issued by STATS ChipPAC (Thailand) Limited 
incorporated by reference to Exhibit 4.52 of Form 20-F (File No. 333-75080) of STATS
ChipPAC Ltd., as filed with the Securities and Exchange Commission on March 7, 20084.42#
    
    US$50,000,000 Uncommitted Facility Agreement dated November 23, 2007 by and between Bank
of America, N.A., Singapore Branch and STATS ChipPAC Ltd.  incorporated by reference to
Exhibit 4.53 of Form 20-F (File No. 333-75080) of STATS ChipPAC Ltd., as filed with the
Securities and Exchange Commission on March 7, 20088.1**
    
    List of subsidiaries12.1**
    
    Certification by the Chief Executive Officer pursuant to 17 CFR 240. 15d-14(a), as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 200212.2**
    
    Certification by the Chief
Financial Officer pursuant to 17 CFR 240. 15d-14(a), as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of 200213.1**
    
    Certification by the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200213.2**
    
    Certification by the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200215.1**
    
    Consent of PricewaterhouseCoopers
LLP, Singapore, independent registered public accounting firm
 
 #
    
    Certain portions of this exhibit have been omitted pursuant to a confidential treatment order
of the SEC. The omitted portions have been filed separately with the SEC.**
    
    Filed herewith. 106




---



##### Table of Contents



SIGNATURES
   STATS CHIPPAC LTD.By:
    /s/ Tan Lay KoonName
    Tan Lay KoonTitle:
    President and Chief Executive OfficerBy:
    /s/ John Lau Tai ChongName:
    John Lau Tai ChongTitle:
    Chief Financial Officer 107




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 
 INDEX TO FINANCIAL STATEMENTS
 PageFINANCIAL STATEMENTSReport of Independent Registered Public Accounting Firm
    
    F-2Consolidated Balance Sheets
    
    F-3Consolidated Statements of Operations
    
    F-4Consolidated Statements of Comprehensive Income (Loss)
    
    F-5Consolidated Statements of Shareholders Equity
    
    F-6Consolidated Statements of Cash Flows
    
    F-7Notes to the Consolidated Financial Statements
    
    F-8
 F-1




---



##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
      
 F-2




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 
 CONSOLIDATED BALANCE SHEETS
 In thousands of U.S. Dollars (except per share data)
 December 30,
    
    
    December 28,Note
    
    2007
    
    
    2008ASSETSCurrent assets:Cash and cash equivalents
    
    3
    
    $
    213,461
    
    
    $
    295,916Short-term marketable securities
    
    4
    
    
    29,230
    
    
    
    41,314Accounts receivable, net
    
    5
    
    
    271,360
    
    
    
    139,520Short-term amounts due from affiliates
    
    2
    
    
    9,292
    
    
    
    10,791Other receivables
    
    6
    
    
    6,877
    
    
    
    8,357Inventories
    
    7
    
    
    83,312
    
    
    
    60,717Prepaid expenses and other current assets
    
    8
    
    
    22,320
    
    
    
    14,693Total current assets
    
    
    
    
    635,852
    
    
    
    571,308Long-term marketable securities
    
    4
    
    
    15,296
    
    
    
    15,587Long-term amounts due from affiliates
    
    2
    
    
    6,852
    
    
    
    13,726Property, plant and equipment, net
    
    9
    
    
    1,276,490
    
    
    
    1,216,342Investment in equity investee
    
    2
    
    
    10,350
    
    
    
    9,001Intangible assets
    
    10
    
    
    40,754
    
    
    
    44,762Goodwill
    
    11
    
    
    547,958
    
    
    
    551,132Long-term restricted cash
    
    
    
    
    1,612
    
    
    
    1,012Prepaid expenses and other non-current assets
    
    8
    
    
    61,790
    
    
    
    24,193Total assets
    
    
    
    $
    2,596,954
    
    
    $
    2,447,063LIABILITIES AND SHAREHOLDERS EQUITYCurrent liabilities:Accounts and other payable
    
    
    
    $
    164,300
    
    
    $
    118,227Payables related to property, plant and equipment purchases
    
    
    
    
    70,744
    
    
    
    30,704Accrued operating expenses
    
    12
    
    
    109,516
    
    
    
    148,069Income taxes payable
    
    
    
    
    17,250
    
    
    
    3,379Short-term borrowings
    
    14
    
    
    50,300
    
    
    
    50,000Short-term amounts due to affiliates
    
    2
    
    
    1,651
    
    
    
    1,388Current installments of long-term debts
    
    15
    
    
    190,481
    
    
    
    26,953Total current liabilities
    
    
    
    
    604,242
    
    
    
    378,720Long-term debts, excluding current installments
    
    15
    
    
    423,853
    
    
    
    396,500Other non-current liabilities
    
    17
    
    
    125,093
    
    
    
    64,144Total liabilities
    
    
    
    
    1,153,188
    
    
    
    839,364Minority interest
    
    
    
    
    59,797
    
    
    
    59,042Share capital:Ordinary shares  Issued ordinary shares  2,047,333,663
in 2007 and 2,202,218,293 in 2008
    
    18, 19
    
    
    1,891,546
    
    
    
    2,035,235Accumulated other comprehensive loss
    
    20
    
    
    (7,605
    )
    
    
    (12,308
    )Accumulated deficit
    
    
    
    
    (499,972
    )
    
    
    (474,270
    )Total shareholders equity
    
    
    
    
    1,383,969
    
    
    
    1,548,657Commitments and contingencies
    
    22Total liabilities and shareholders equity
    
    
    
    $
    2,596,954
    
    
    $
    2,447,063
  F-3




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 In thousands of U.S. Dollars (except per share data)
 Year EndedDecember 31,
    
    
    December 30,
    
    
    December 28,Note
    
    2006
    
    
    2007
    
    
    2008Net revenues
    
    
    
    $
    1,616,933
    
    
    $
    1,651,560
    
    
    $
    1,658,188Cost of revenues
    
    
    
    
    (1,290,773
    )
    
    
    (1,330,284
    )
    
    
    (1,383,797
    )Gross profit
    
    
    
    
    326,160
    
    
    
    321,276
    
    
    
    274,391Operating expenses:Selling, general and administrative
    
    
    
    
    139,466
    
    
    
    112,593
    
    
    
    118,337Research and development
    
    
    
    
    30,446
    
    
    
    34,918
    
    
    
    37,825Restructuring charges
    
    23
    
    
    1,938
    
    
    
    990
    
    
    
    19,790Equipment impairment
    
    
    
    
    
    
    
    
    
    
    
    
    21,091Accelerated share-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    1,562Tender offer expenses
    
    
    
    
    
    
    
    
    10,922
    
    
    
    Held for sale asset impairment
    
    
    
    
    
    
    
    
    1,725
    
    
    
    Total operating expenses
    
    
    
    
    171,850
    
    
    
    161,148
    
    
    
    198,605Operating income
    
    
    
    
    154,310
    
    
    
    160,128
    
    
    
    75,786Other income (expense), net:Interest income
    
    
    
    
    5,401
    
    
    
    7,258
    
    
    
    5,685Interest expense
    
    
    
    
    (45,816
    )
    
    
    (40,450
    )
    
    
    (35,986
    )Foreign currency exchange gain (loss)
    
    
    
    
    (1,578
    )
    
    
    2,487
    
    
    
    5,247Equity income (loss) from investment in equity investee
    
    
    
    
    152
    
    
    
    102
    
    
    
    (1,437
    )Other non-operating income (expense), net
    
    24
    
    
    108
    
    
    
    (442
    )
    
    
    27Total other expense, net
    
    
    
    
    (41,733
    )
    
    
    (31,045
    )
    
    
    (26,464
    )Income before income taxes
    
    
    
    
    112,577
    
    
    
    129,083
    
    
    
    49,322Income tax expense
    
    13
    
    
    (25,759
    )
    
    
    (29,581
    )
    
    
    (19,172
    )Income before minority interest
    
    
    
    
    86,818
    
    
    
    99,502
    
    
    
    30,150Minority interest
    
    
    
    
    (10,010
    )
    
    
    (5,818
    )
    
    
    (4,448
    )Net income
    
    
    
    $
    76,808
    
    
    $
    93,684
    
    
    $
    25,702Net income per ordinary share: basic
    
    
    
    $
    0.04
    
    
    $
    0.05
    
    
    $
    0.01 diluted
    
    
    
    $
    0.04
    
    
    $
    0.04
    
    
    $
    0.01Net income per ADS: basic
    
    
    
    $
    0.39
    
    
    $
    0.46
    
    
    
     diluted
    
    
    
    $
    0.37
    
    
    $
    0.44
    
    
    
    Ordinary shares (in thousands) used in per ordinary
share calculation: basic
    
    
    
    
    1,991,110
    
    
    
    2,032,962
    
    
    
    2,143,934 diluted
    
    
    
    
    2,161,545
    
    
    
    2,188,687
    
    
    
    2,146,249ADS (in thousands) used in per ADS calculation: basic
    
    
    
    
    199,111
    
    
    
    203,296
    
    
    
     diluted
    
    
    
    
    216,154
    
    
    
    218,869
    
    
    
    
  F-4




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
 In thousands of U.S. Dollars
 Year EndedDecember 31,
    
    
    December 30,
    
    
    December 28,2006
    
    
    2007
    
    
    2008Net income
    
    $
    76,808
    
    
    $
    93,684
    
    
    $
    25,702Other comprehensive income (loss)Unrealized gain (loss) on available-for-sale
marketable securities
    
    
    (5
    )
    
    
    9
    
    
    
    327Realized (gain) loss on available-for-sale
marketable securities included in net income
    
    
    (5
    )
    
    
    131
    
    
    
    (36
    )Unrealized gain (loss) on hedging instruments
    
    
    3,058
    
    
    
    1,736
    
    
    
    (14,463
    )Realized (gain) loss on hedging instruments
included in net income
    
    
    (3,157
    )
    
    
    (2,034
    )
    
    
    9,972Foreign currency translation adjustment
    
    
    967
    
    
    
    267
    
    
    
    (503
    )Comprehensive income
    
    $
    77,666
    
    
    $
    93,793
    
    
    $
    20,999
  F-5




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
 In thousands of U.S. Dollars
 AccumulatedAdditional
    
    
    Other
    
    
    
    
    
    
    TotalPaid-in
    
    
    Comprehensive
    
    
    Accumulated
    
    
    ShareholdersOrdinary Shares
    
    
    Capital
    
    
    Loss
    
    
    Deficit
    
    
    EquityNo.(In thousands)Balances at December 26, 2005
    
    
    1,976,292
    
    
    $
    303,052
    
    
    $
    1,517,118
    
    
    $
    (8,572
    )
    
    $
    (669,946
    )
    
    $
    1,141,652Share issuances
    
    
    26,522
    
    
    
    13,197
    
    
    
    57
    
    
    
    
    
    
    
    
    
    
    
    13,254Share-based compensation
    
    
    
    
    
    
    13,688
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,688Effect of abolition of the
share par value
    
    
    
    
    
    
    1,517,175
    
    
    
    (1,517,175
    )
    
    
    
    
    
    
    
    
    
    
    Effect of subsidiarys
equity transaction
    
    
    
    
    
    
    (110
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (110
    )Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    76,808
    
    
    
    76,808Other comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    858
    
    
    
    
    
    
    
    858Balances at December 31, 2006
    
    
    2,002,814
    
    
    
    1,847,002
    
    
    
    
    
    
    
    (7,714
    )
    
    
    (593,138
    )
    
    
    1,246,150Adjustment for initial
adoption of FIN 48
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (518
    )
    
    
    (518
    )Balances at January 1, 2007,
as adjusted
    
    
    2,002,814
    
    
    
    1,847,002
    
    
    
    
    
    
    
    (7,714
    )
    
    
    (593,656
    )
    
    
    1,245,632Share issuances
    
    
    27,794
    
    
    
    19,851
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,851Conversion of convertible
subordinated notes
    
    
    16,726
    
    
    
    15,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,500Share-based compensation
    
    
    
    
    
    
    8,869
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,869Effect of subsidiarys
equity transaction
    
    
    
    
    
    
    324
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    324Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    93,684
    
    
    
    93,684Other comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    109
    
    
    
    
    
    
    
    109Balances at December 30, 2007
    
    
    2,047,334
    
    
    
    1,891,546
    
    
    
    
    
    
    
    (7,605
    )
    
    
    (499,972
    )
    
    
    1,383,969Share issuances
    
    
    9,745
    
    
    
    7,833
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,833Conversion of convertible
subordinated notes
    
    
    145,139
    
    
    
    134,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    134,500Share-based compensation
    
    
    
    
    
    
    3,570
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,570Reclassification of
share-based compensation to
liability
    
    
    
    
    
    
    (2,154
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,154
    )Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,702
    
    
    
    25,702Effect of subsidiarys
equity transaction
    
    
    
    
    
    
    (60
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (60
    )Other comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,703
    )
    
    
    
    
    
    
    (4,703
    )Balances at December 28, 2008
    
    
    2,202,218
    
    
    $
    2,035,235
    
    
    $
    
    
    
    $
    (12,308
    )
    
    $
    (474,270
    )
    
    $
    1,548,657
  F-6




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 In thousands of U.S. Dollars
 Year EndedDecember 31,2006
    
    
    December 30,2007
    
    
    December 28,2008Cash Flows From Operating ActivitiesNet income
    
    $
    76,808
    
    
    $
    93,684
    
    
    $
    25,702Adjustments to reconcile net income to net cash provided by operating
activities:Depreciation and amortization
    
    
    266,317
    
    
    
    254,352
    
    
    
    283,691Amortization of leasing prepayments
    
    
    7,386
    
    
    
    11
    
    
    
    Debt issuance cost amortization
    
    
    2,371
    
    
    
    2,561
    
    
    
    2,737Equipment impairment
    
    
    
    
    
    
    
    
    
    
    21,091(Gain) loss on sale of property, plant and equipment
    
    
    1,251
    
    
    
    (17
    )
    
    
    1,123Impairment of assets held for sale
    
    
    
    
    
    
    1,725
    
    
    
    Accretion of discount on convertible notes
    
    
    6,618
    
    
    
    4,830
    
    
    
    66Loss from repurchase and redemption of senior and convertible notes
    
    
    500
    
    
    
    
    
    
    
    Foreign currency exchange (gain) loss
    
    
    758
    
    
    
    724
    
    
    
    (1,555
    )Share-based compensation expense
    
    
    13,688
    
    
    
    8,869
    
    
    
    3,570Deferred income taxes
    
    
    19,853
    
    
    
    (3,675
    )
    
    
    5,511Minority interest in income of subsidiary
    
    
    10,010
    
    
    
    5,818
    
    
    
    4,448Equity loss (income) from investment in equity investee
    
    
    (152
    )
    
    
    (102
    )
    
    
    1,437Others
    
    
    1,004
    
    
    
    1,604
    
    
    
    4,178Changes in operating working capital:Accounts receivable
    
    
    (2,789
    )
    
    
    (27,581
    )
    
    
    131,840Amounts due from affiliates
    
    
    4,304
    
    
    
    (13,638
    )
    
    
    (8,373
    )Inventories
    
    
    (32,268
    )
    
    
    29,599
    
    
    
    22,595Other receivables, prepaid expenses and other assets
    
    
    7,355
    
    
    
    7,112
    
    
    
    (2,951
    )Accounts payable, accrued operating expenses and other
payables
    
    
    44,774
    
    
    
    44,030
    
    
    
    (75,322
    )Amounts due to affiliates
    
    
    (17
    )
    
    
    1,606
    
    
    
    (263
    )Net cash provided by operating activities
    
    
    427,771
    
    
    
    411,512
    
    
    
    419,525Cash Flows From Investing ActivitiesProceeds from sales of marketable securities
    
    $
    35,391
    
    
    $
    19,660
    
    
    $
    29,755Proceeds from maturity of marketable securities
    
    
    20,841
    
    
    
    23,599
    
    
    
    50,141Purchases of marketable securities
    
    
    (80,866
    )
    
    
    (27,450
    )
    
    
    (93,094
    )Investment in equity investee
    
    
    (10,154
    )
    
    
    
    
    
    
    Acquisition of intangible assets
    
    
    (6,419
    )
    
    
    (6,762
    )
    
    
    (12,871
    )Acquisition of business
    
    
    
    
    
    
    (100,000
    )
    
    
    Purchases of property, plant and equipment
    
    
    (393,643
    )
    
    
    (232,288
    )
    
    
    (278,899
    )Proceeds from sale of assets held for sale
    
    
    4,027
    
    
    
    21,829
    
    
    
    19,108Others, net
    
    
    5,040
    
    
    
    2,324
    
    
    
    2,146Net cash used in investing activities
    
    
    (425,783
    )
    
    
    (299,088
    )
    
    
    (283,714
    )Cash Flows From Financing ActivitiesRepayment of short-term debts
    
    $
    (42,290
    )
    
    $
    (6,549
    )
    
    $
    (5,035
    )Repayment of long-term debts
    
    
    (27,627
    )
    
    
    (170,518
    )
    
    
    (33,888
    )Proceeds from issuance of shares, net of expenses
    
    
    13,254
    
    
    
    19,851
    
    
    
    6,152Repurchase and redemption of senior and convertible notes
    
    
    (50,500
    )
    
    
    (36,800
    )
    
    
    (22,057
    )Proceeds from promissory notes
    
    
    
    
    
    
    50,000
    
    
    
    Proceeds from bank borrowings
    
    
    60,308
    
    
    
    82,857
    
    
    
    4,735(Increase) decrease in restricted cash
    
    
    1,627
    
    
    
    (631
    )
    
    
    600Grants received
    
    
    
    
    
    
    
    
    
    
    340Capital lease payments
    
    
    (7,091
    )
    
    
    (3,680
    )
    
    
    Distribution to minority interest in subsidiary
    
    
    (2,542
    )
    
    
    (4,980
    )
    
    
    (4,312
    )Net cash used in financing activities
    
    
    (54,861
    )
    
    
    (70,450
    )
    
    
    (53,465
    )Net increase (decrease) in cash and cash equivalents
    
    
    (52,873
    )
    
    
    41,974
    
    
    
    82,346Effect of exchange rate changes on cash and cash equivalents
    
    
    (390
    )
    
    
    30
    
    
    
    109Cash and cash equivalents at beginning of the year
    
    
    224,720
    
    
    
    171,457
    
    
    
    213,461Cash and cash equivalents at end of the year
    
    $
    171,457
    
    
    $
    213,461
    
    
    $
    295,916Supplementary Cash Flow InformationInterest paid
    
    $
    28,307
    
    
    $
    31,652
    
    
    $
    31,497Income taxes paid
    
    
    1,418
    
    
    
    6,158
    
    
    
    14,280Non-cash itemsIssuance of shares on conversion of convertible notes
    
    $
    
    
    
    $
    15,500
    
    
    $
    134,500
  F-7




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 In thousands of U.S. Dollars (except per share data)
 1. Background and Summary of Significant Accounting Policies
 (a) Business and Organization
    Proposed Capital Reduction Exercise and Related Financing Transaction
    Acquisition of LSI Corporations assembly and test facility in Thailand
  Temaseks Subsidiary, Singapore Technologies Semiconductors Pte Ltds Tender Offer
  F-8




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
    (b) Fiscal Year
  (c) Accounting Principles
  (d) Principles of Consolidation
  (e) Issuances of Stock by Subsidiaries
  (f) Use of Estimates
  F-9




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 (g) Foreign Currency Transactions
   (h) Certain Risks and Concentrations
     (i) Cash and Cash Equivalents
  F-10




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 (j) Restricted Cash
  (k) Derivative Instruments and Hedging Activities
    (l) Marketable Securities
    F-11




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 (m) Inventories
  (n) Equity Method Investments
  (o) Business Combination
  (p) Goodwill
   (q) Intangible Assets
   F-12




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 Tradenames
    
    7 yearsTechnology and intellectual property
    
    10 yearsCustomer relationships
    
    2 yearsSoftware and licenses
    
    3 to 5 years
 (r) Property, Plant and Equipment
  Land use rights
    
    50 to 99 yearsBuilding, mechanical and electrical installation
    
    3 to 25 yearsEquipment
    
    2 to 8 years
   (s) Long-Lived Assets
   (t) Comprehensive Income (Loss)
  (u) Revenue Recognition
   F-13




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
    Year EndedDecember 31,
    
    December 30,
    
    December 28,2006
    
    2007
    
    2008Revenue packaging  laminate
    
    
    55.5
    %
    
    
    56.3
    %
    
    
    56.5
    % packaging  leaded
    
    
    18.3
    
    
    
    18.4
    
    
    
    18.0 test and other services
    
    
    26.2
    
    
    
    25.3
    
    
    
    25.5Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
  (v) Grants
    (w) Share-Based Compensation
 
 F-14




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  (x) Employee Benefit Plans
      (y) Operating Leases
  (z) Product Warranties
  F-15




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  (aa) Research and Development
  (bb) Income Taxes
    (cc) Net Income (Loss) Per Share
    December 31,
    
    December 30,
    
    December 28,2006
    
    2007
    
    2008Convertible notes
    
    
    82,454
    
    
    
    10,613
    
    
    
    Share plans
    
    
    103,508
    
    
    
    15,609
    
    
    
    14,310
 F-16




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
   Year EndedDecember 31,
    
    
    December 30,
    
    
    December 28,2006
    
    
    2007
    
    
    2008Net income
    
    $
    76,808
    
    
    $
    93,684
    
    
    $
    25,702Adjusted net income
    
    
    79,058
    
    
    
    95,702
    
    
    
    25,702Weighted average
number of ordinary
shares outstanding
(basic)
    
    
    1,991,110
    
    
    
    2,032,962
    
    
    
    2,143,934Weighted average
dilutive shares
from share plans
    
    
    8,564
    
    
    
    10,581
    
    
    
    2,315Weighted average
dilutive
convertible notes
    
    
    161,871
    
    
    
    145,144
    
    
    
    Weighted average
number of ordinary
shares and
equivalent ordinary
shares outstanding
(diluted)
    
    
    2,161,545
    
    
    
    2,188,687
    
    
    
    2,146,249
 (dd) Reclassifications
  (ee) New Accounting Pronouncements
   F-17




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
      F-18




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  2. Related Party Transactions
       December 30,2007
    
    
    December 28,2008Short-term and long-term amounts due from affiliatesAccounts receivable, net of allowance for sales returns
    
    $
    2,859
    
    
    $
    1,955Receivables on assets transfer due from affiliate
    
    
    13,285
    
    
    
    22,562$
    16,144
    
    
    $
    24,517Short-term amounts due to affiliatesAccounts payable
    
    $
    (1,651
    )
    
    $
    (1,388
    )
  F-19




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 3. Cash and cash equivalents consist of the following:
 December 30,2007
    
    
    December 28,2008Cash at banks and on hand
    
    $
    110,756
    
    
    $
    88,800Cash equivalentsBank fixed deposits
    
    
    23,022
    
    
    
    141,924Money market funds
    
    
    79,056
    
    
    
    65,192Foreign government treasury bills
    
    
    627
    
    
    
    $
    213,461
    
    
    $
    295,916
 4. Marketable Securities
  December 30, 2007
    
    
    December 28, 2008Gross
    
    
    Gross
    
    
    
    
    
    
    
    
    
    
    Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Fair
    
    
    Amortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    Value
    
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    ValueAvailable-for-sale
corporate debt
securities and
certificates of
deposits
    
    $
    45,423
    
    
    $
    
    
    
    $
    (897
    )
    
    $
    44,526
    
    
    $
    57,507
    
    
    $
    
    
    
    $
    (606
    )
    
    $
    56,901
  December 30,2007
    
    
    December 28,2008Marketable securities:Due in one year or less
    
    $
    29,230
    
    
    $
    41,314Due after one year through five years
    
    
    1,064
    
    
    
    15,587Due after five years
    
    
    14,232
    
    
    
    $
    44,526
    
    
    $
    56,901
  5. Accounts Receivable
  December 30,2007
    
    
    December 28,2008Accounts receivable  third parties
    
    $
    277,628
    
    
    $
    145,628Allowance for sales returns
    
    
    (6,268
    )
    
    
    (6,108
    )$
    271,360
    
    
    $
    139,520
 F-20




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  Year EndedDecember 31,2006
    
    
    December 30,2007
    
    
    December 28,2008Beginning
    
    $
    2,840
    
    
    $
    3,406
    
    
    $
    6,268Utilized during the year
    
    
    
    
    
    
    (98
    )
    
    
    (4,122
    )Charged during the year
    
    
    3,034
    
    
    
    4,681
    
    
    
    4,144Writeback during the year
    
    
    (2,468
    )
    
    
    (1,721
    )
    
    
    (182
    )Ending
    
    $
    3,406
    
    
    $
    6,268
    
    
    $
    6,108
 6. Other Receivables
  December 30,2007
    
    
    December 28,2008Deposits and staff advances
    
    $
    923
    
    
    $
    911Forward contract receivable
    
    
    299
    
    
    
    Taxes receivable
    
    
    1,969
    
    
    
    833Grants receivables
    
    
    
    
    
    
    117Other receivables
    
    
    3,686
    
    
    
    6,496$
    6,877
    
    
    $
    8,357
 7. Inventories
  December 30,2007
    
    
    December 28,2008Raw materials
    
    $
    65,877
    
    
    $
    50,775Work-in-progress
    
    
    14,872
    
    
    
    8,328Finished goods
    
    
    2,563
    
    
    
    1,614$
    83,312
    
    
    $
    60,717
 8. Prepaid Expenses and Other Assets
  December 30,2007
    
    
    December 28,2008Other prepayments and assets
    
    $
    8,241
    
    
    $
    9,999Deferred income tax assets
    
    
    1,207
    
    
    
    4,694Loans to a vendor
    
    
    3,529
    
    
    
    Assets held for sale
    
    
    9,343
    
    
    
    $
    22,320
    
    
    $
    14,693
  December 30,2007
    
    
    December 28,2008Deferred income tax assets
    
    $
    39,609
    
    
    $
    13,095Other deposits
    
    
    303
    
    
    
    295Loans to a vendor
    
    
    882
    
    
    
    Debt issuance cost, net of
accumulated amortization of
$7,958 and $5,547
    
    
    6,949
    
    
    
    4,212Leasing prepayments
    
    
    248
    
    
    
    Assets held for sale
    
    
    10,544
    
    
    
    43Others
    
    
    3,255
    
    
    
    6,548$
    61,790
    
    
    $
    24,193
 F-21




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
   9. Property, Plant and Equipment
  December 30,2007
    
    
    December 28,2008Cost:Freehold land
    
    $
    11,010
    
    
    $
    10,703Freehold landLand and land use rights
    
    
    19,864
    
    
    
    19,864Buildings, mechanical and electrical installation
    
    
    262,186
    
    
    
    269,046Equipment
    
    
    2,145,503
    
    
    
    2,216,667Total cost
    
    $
    2,438,563
    
    
    $
    2,516,280Total accumulated depreciation
    
    $
    1,162,073
    
    
    $
    1,299,938Property, plant and equipment, net
    
    $
    1,276,490
    
    
    $
    1,216,342
      F-22




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 10. Intangible Assets
  December 30, 2007
    
    
    December 28, 2008Gross
    
    
    Accumulated
    
    
    Net
    
    
    Gross
    
    
    Accumulated
    
    
    NetAssets
    
    
    Amortization
    
    
    Assets
    
    
    Assets
    
    
    Amortization
    
    
    AssetsTradenames
    
    $
    7,700
    
    
    $
    (3,758
    )
    
    $
    3,942
    
    
    $
    7,700
    
    
    $
    (4,858
    )
    
    $
    2,842Technology and
intellectual property
    
    
    32,000
    
    
    
    (10,933
    )
    
    
    21,067
    
    
    
    32,000
    
    
    
    (14,133
    )
    
    
    17,867Customer relationships
    
    
    99,300
    
    
    
    (99,300
    )
    
    
    
    
    
    
    99,300
    
    
    
    (99,300
    )
    
    
    Patent costs,
software, licenses and
others
    
    
    31,469
    
    
    
    (15,724
    )
    
    
    15,745
    
    
    
    43,990
    
    
    
    (19,937
    )
    
    
    24,053$
    170,469
    
    
    $
    (129,715
    )
    
    $
    40,754
    
    
    $
    182,990
    
    
    $
    (138,228
    )
    
    $
    44,762
  Year EndedDecember 31,2006
    
    
    December 30,2007
    
    
    December 28,2008Tradenames
    
    $
    1,100
    
    
    $
    1,100
    
    
    $
    1,100Technology and intellectual property
    
    
    3,200
    
    
    
    3,200
    
    
    
    3,200Customer relationships
    
    
    28,962
    
    
    
    
    
    
    
    Software, licenses and others
    
    
    3,988
    
    
    
    3,498
    
    
    
    4,347$
    37,250
    
    
    $
    7,798
    
    
    $
    8,647
  2009
    
    $
    9,2862010
    
    
    8,0422011
    
    
    6,6312012
    
    
    4,0632013
    
    
    3,912Thereafter
    
    
    12,828Total
    
    $
    44,762
 11. Goodwill
  December 30,2007
    
    
    December 28,2008Beginning
    
    $
    513,512
    
    
    $
    547,958Goodwill relating to acquisition
    
    
    24,809
    
    
    
    Purchase adjustments
    
    
    9,637
    
    
    
    3,174Ending
    
    $
    547,958
    
    
    $
    551,132
  F-23




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
   12. Accrued Operating Expenses
  December 30,2007
    
    
    December 28,2008Staff costs and accrued restructuring charges
    
    $
    40,276
    
    
    $
    49,224Purchase of raw materials
    
    
    18,639
    
    
    
    4,636Maintenance fees, license fees and royalties
    
    
    4,146
    
    
    
    5,025Interest expense
    
    
    7,535
    
    
    
    7,536Provision for vacation liability
    
    
    5,048
    
    
    
    4,697Liability for uncertain tax positions
    
    
    
    
    
    
    34,621Others
    
    
    33,872
    
    
    
    42,330$
    109,516
    
    
    $
    148,069
 13. Income Taxes
  Year EndedDecember 31,2006
    
    
    December 30,2007
    
    
    December 28,2008Singapore
    
    $
    951
    
    
    $
    (9,416
    )
    
    $
    (9,652
    )Foreign
    
    
    111,626
    
    
    
    138,499
    
    
    
    58,974$
    112,577
    
    
    $
    129,083
    
    
    $
    49,322
  Year EndedDecember 31,2006
    
    
    December 30,2007
    
    
    December 28,2008Current tax:Singapore
    
    $
    
    
    
    $
    
    
    
    $
    Foreign
    
    
    (5,935
    )
    
    
    (23,192
    )
    
    
    (13,679
    )Total current tax
    
    $
    (5,935
    )
    
    $
    (23,192
    )
    
    $
    (13,679
    )Deferred tax:Singapore
    
    $
    (1,400
    )
    
    $
    (2,000
    )
    
    $
    (5,804
    )Foreign
    
    
    (18,424
    )
    
    
    (4,389
    )
    
    
    311Total deferred tax
    
    $
    (19,824
    )
    
    $
    (6,389
    )
    
    $
    (5,493
    )$
    (25,759
    )
    
    $
    (29,581
    )
    
    $
    (19,172
    )
 F-24




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  Year EndedDecember 31,2006
    
    
    December 30,2007
    
    
    December 28,2008Income tax expense computed at Singapore
statutory rate of 18.0% (2007: 18.0% and 2006: 20.0%)
    
    $
    22,515
    
    
    $
    23,235
    
    
    $
    8,878Non-deductible expenses
    
    
    4,892
    
    
    
    4,948
    
    
    
    9,018Non-taxable income, including income exemption
    
    
    (461
    )
    
    
    (1,558
    )
    
    
    (9,287
    )Differences in tax rates
    
    
    5,550
    
    
    
    10,239
    
    
    
    7,411Effect of recognizing deferred tax assets at
concessionary tax rate and tax credits
    
    
    (13,926
    )
    
    
    (14,660
    )
    
    
    (3,694
    )Change in statutory tax rate
    
    
    (651
    )
    
    
    
    
    
    
    Tax benefits from employee share option plans
    
    
    (665
    )
    
    
    (90
    )
    
    
    (100
    )Reinvestment allowance
    
    
    (5,632
    )
    
    
    (4,516
    )
    
    
    (1,392
    )Change in valuation allowance
    
    
    9,114
    
    
    
    12,163
    
    
    
    25,446Taxable foreign exchange adjustment
    
    
    4,575
    
    
    
    (3,645
    )
    
    
    (17,293
    )All other items, net
    
    
    448
    
    
    
    3,465
    
    
    
    185Income tax expense
    
    $
    25,759
    
    
    $
    29,581
    
    
    $
    19,172
  December 30,2007
    
    
    December 28,2008Deferred income tax assets:Operating loss carryforwards
    
    $
    21,833
    
    
    $
    26,335Investment, and research and development tax credits
    
    
    59,811
    
    
    
    50,609Reinvestment allowance
    
    
    39,484
    
    
    
    40,876Property, plant and equipment
    
    
    42,859
    
    
    
    42,312Others
    
    
    8,777
    
    
    
    15,051172,764
    
    
    
    175,183Valuation allowance
    
    
    (131,948
    )
    
    
    (157,394
    )$
    40,816
    
    
    $
    17,789Deferred income tax liabilities:Property, plant and equipment
    
    $
    42,868
    
    
    $
    27,212Allowances and reserves
    
    
    21,777
    
    
    
    1,98964,645
    
    
    
    29,201Net deferred income tax assets (liabilities)
    
    $
    (23,829
    )
    
    $
    (11,412
    )
   F-25




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
       December 30,2007
    
    
    December 28,2008Unrecognized tax benefits:Beginning
    
    $
    518
    
    
    $
    21,422Increases related to prior year tax positions
    
    
    13,521
    
    
    
    24,211Increases related to current year tax positions
    
    
    7,383
    
    
    
    927Decreases related to current year tax positions
    
    
    
    
    
    
    (4,111
    )Decreases related to settlements with taxing authorities
    
    
    
    
    
    
    (150
    )Decreases as a result of lapse of applicable statute
limitations
    
    
    
    
    
    
    (179
    )Ending
    
    $
    21,422
    
    
    $
    42,120
 F-26




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
     14. Short-Term Borrowings
  15. Long-Term Debts
  December 30,2007
    
    
    December 28,20086.75% senior fixed-rate notes
    
    $
    215,000
    
    
    $
    215,0007.5% senior fixed-rate notes
    
    
    150,000
    
    
    
    150,0002.5% convertible subordinated fixed-rate notes
    
    
    134,500
    
    
    
    0% convertible senior fixed-rate notes
    
    
    18,551
    
    
    
    6% promissory note
    
    
    46,800
    
    
    
    26,800U.S. dollars bank loan at floating rates
    
    
    12,600
    
    
    
    6,600Taiwan dollar loans at floating rates
    
    
    32,315
    
    
    
    25,053Taiwan dollar loans and commercial papers at fixed rates
    
    
    1,128
    
    
    
    Accrued yield-to-maturity interest on convertible notes
    
    
    3,440
    
    
    
    614,334
    
    
    
    423,453Less current amounts
    
    
    (190,481
    )
    
    
    (26,953
    )$
    423,853
    
    
    $
    396,500
  F-27




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
     F-28




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
     F-29




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
        F-30




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  Payable in year2009
    
    
    26,9532010
    
    
    170,3532011
    
    
    225,3742012
    
    
    773$
    423,453
  16. Unutilized Credit Facilities
  17. Other Non-Current Liabilities
  December 30,
    
    
    December 28,2007
    
    
    2008Deferred tax liabilities
    
    $
    64,463
    
    
    $
    29,191Accrued retirement and severance
benefits
    
    
    38,985
    
    
    
    22,908Liability for uncertain tax
positions
    
    
    16,604
    
    
    
    7,499Others
    
    
    5,041
    
    
    
    4,546$
    125,093
    
    
    $
    64,144
  Year EndedDecember 31,
    
    
    December 30,
    
    
    December 28,2006
    
    
    2007
    
    
    2008Beginning
    
    $
    20,210
    
    
    $
    27,154
    
    
    $
    39,237Increase due to acquisition
    
    
    
    
    
    
    7,677
    
    
    
    Provision for retirement and
severance benefits
    
    
    9,119
    
    
    
    12,031
    
    
    
    8,166Severance payments
    
    
    (4,172
    )
    
    
    (7,348
    )
    
    
    (15,752
    )Foreign currency loss
    
    
    1,997
    
    
    
    (277
    )
    
    
    (8,568
    )Ending
    
    $
    27,154
    
    
    $
    39,237
    
    
    $
    23,083Payments on deposits with Korean
National Pension Fund
    
    
    (262
    )
    
    
    (252
    )
    
    
    (175
    )Ending, net of payments on deposits
    
    $
    26,892
    
    
    $
    38,985
    
    
    $
    22,908
 F-31




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 18. Share Capital and Additional Paid-in Capital
    19. Share Repurchase
  20. Accumulated Other Comprehensive (Loss) Income
  December 30,
    
    
    December 28,2007
    
    
    2008Currency translation loss
    
    $
    (7,086
    )
    
    $
    (7,589
    )Unrealized gain (loss) on hedging instruments
    
    
    378
    
    
    
    (4,113
    )Unrealized loss on available-for-sale marketable securities
    
    
    (897
    )
    
    
    (606
    )$
    (7,605
    )
    
    $
    (12,308
    )
 21. Share Options and Incentive Plans
   F-32




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 Year EndedDecember 31,
    
    
    December 30,
    
    
    December 28,2006
    
    
    2007
    
    
    2008Cost of revenues
    
    $
    5,965
    
    
    $
    4,783
    
    
    $
    905Selling, general and administrative
    
    
    6,143
    
    
    
    3,118
    
    
    
    875Research and development
    
    
    1,580
    
    
    
    968
    
    
    
    228Accelerated share-based compensation
    
    
    
    
    
    
    
    
    
    
    1,562$
    13,688
    
    
    $
    8,869
    
    
    $
    3,570
     WeightedAverage
    
    
    AggregateOptions
    
    
    Exercise Price
    
    
    Intrinsic Value(In thousands)
    
    
    
    
    
    
    (In thousands)Options outstanding at December 26, 2005
    
    
    124,175
    
    
    
    1.01Granted
    
    
    16,498
    
    
    
    0.68Lapsed and forfeited
    
    
    (17,596
    )
    
    
    1.11Exercised
    
    
    (6,277
    )
    
    
    0.41Options outstanding at December 31, 2006
    
    
    116,800
    
    
    
    0.99Lapsed and forfeited
    
    
    (4,222
    )
    
    
    1.25Surrendered in tender offer
    
    
    (85,348
    )
    
    
    1.02Exercised
    
    
    (11,244
    )
    
    
    0.62Options outstanding at December 30, 2007
    
    
    15,986
    
    
    $
    1.70Lapsed and forfeited
    
    
    (1,559
    )
    
    
    1.60Exercised
    
    
    (37
    )
    
    
    0.55Options outstanding at December 28, 2008
    
    
    14,390
    
    
    $
    1.83
    
    
    $
    3Exercisable at December 31, 2006
    
    
    70,732
    
    
    $
    1.19Exercisable at December 30, 2007
    
    
    15,328
    
    
    $
    1.53Exercisable at December 28, 2008
    
    
    14,303
    
    
    $
    1.53
    
    
    $
    3
  F-33




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  Options Outstanding
    
    Options ExercisableWeighted
    
    
    
    
    
    
    
    
    
    WeightedAverage
    
    Weighted
    
    
    
    
    
    Average
    
    WeightedRange of
    
    Number
    
    Remaining
    
    Average
    
    Number
    
    Remaining
    
    AverageExercise
    
    Outstanding at
    
    Contractual
    
    Exercise
    
    Exercisable at
    
    Contractual
    
    ExercisePrices
    
    12/28/2008
    
    Life
    
    Price
    
    12/28/2008
    
    Life
    
    Price(In thousands)
    
    
    
    
    
    
    
    
    
    (In thousands)$0.14 to $0.15
    
    
    13
    
    
    
    0.8 years
    
    
    $
    0.14
    
    
    
    13
    
    
    
    0.8 years
    
    
    $
    0.14$0.22 to $0.29
    
    
    28
    
    
    
    4.0 years
    
    
    $
    0.29
    
    
    
    28
    
    
    
    4.0 years
    
    
    $
    0.29$0.43 to $0.47
    
    
    1
    
    
    
    2.3 years
    
    
    $
    0.46
    
    
    
    1
    
    
    
    2.2 years
    
    
    $
    0.46$0.55 to $0.87
    
    
    525
    
    
    
    3.8 years
    
    
    $
    0.76
    
    
    
    438
    
    
    
    3.5 years
    
    
    $
    0.79$0.91 to $1.07
    
    
    1
    
    
    
    2.5 years
    
    
    $
    1.07
    
    
    
    1
    
    
    
    2.5 years
    
    
    $
    1.07$1.16 to $1.64
    
    
    12,797
    
    
    
    3.3 years
    
    
    $
    1.39
    
    
    
    12,797
    
    
    
    3.3 years
    
    
    $
    1.39$2.04 to $2.61
    
    
    208
    
    
    
    1.0 years
    
    
    $
    2.09
    
    
    
    208
    
    
    
    1.0 years
    
    
    $
    2.09$3.99
    
    
    817
    
    
    
    1.3 years
    
    
    $
    3.99
    
    
    
    817
    
    
    
    1.3 years
    
    
    $
    3.9914,390
    
    
    
    3.1 years
    
    
    
    
    
    
    
    14,303
    
    
    
    3.1 years
  RSUs
    
    Contingent PSP awardsWeighted
    
    
    
    
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    
    
    
    
    AverageGrant-
    
    
    
    
    
    
    
    
    
    Grant-Number of
    
    Date Fair
    
    Aggregate
    
    Number of
    
    Date Fair
    
    Aggregateshares
    
    Value
    
    Intrinsic Value
    
    shares
    
    Value
    
    Intrinsic Value(In thousands)
    
    
    
    
    
    (In thousands)
    
    (In thousands)
    
    
    
    
    
    (In thousands)Granted in 2007
    
    
    6,970
    
    
    $
    0.86
    
    
    
    
    
    
    
    3,450
    
    
    $
    0.85Lapsed and forfeited
    
    
    (668
    )
    
    
    0.86
    
    
    
    
    
    
    
    (470
    )
    
    
    0.85Outstanding
as of December 30, 2007
    
    
    6,302
    
    
    
    0.86
    
    
    
    
    
    
    
    2,980
    
    
    
    0.85Lapsed and forfeited
    
    
    (655
    )
    
    
    0.86
    
    
    
    
    
    
    
    (45
    )
    
    
    0.85Cancelled
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,935
    )
    
    
    0.85Vested
    
    
    (2,083
    )
    
    
    0.86
    
    
    
    
    
    
    
    
    
    
    
    Outstanding as of
December 28, 2008
    
    
    3,564
    
    
    $
    0.85
    
    
    $
    1,922
    
    
    
    
    
    
    $
    
    
    
    $
    
     Year EndedDecember 30, 2007Expected term
    
    3 yearsDividend yield
    
    
    0.0%Risk free interest rate
    
    
    3.0%Weighted average volatility
    
    
    40.0%
 F-34




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
    Year EndedDecember 31, 2006Expected term
    
    3 - 7 yearsDividend yield
    
    
    0.0%Risk free interest rate
    
    
    3.0% - 3.4%Weighted average volatility
    
    
    39.1%
    22. Commitments and Contingencies
 (a) Commitments
  F-35




---



##### Table of Contents



STATS
CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 December 30,
    
    
    December 28,2007
    
    
    2008Capital commitmentsBuilding, mechanical and electrical installation
    
    $
    9,137
    
    
    $
    2,187Plant and equipment
    
    
    55,094
    
    
    
    33,522Other commitmentsInventories
    
    $
    49,925
    
    
    $
    27,848
      Payable in year2009
    
    
    12,6102010
    
    
    10,3232011
    
    
    9,4322012
    
    
    8,3552013
    
    
    8,330Thereafter
    
    
    27,115$
    76,165
 (b) Contingencies
    F-36




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
       F-37




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  23. Restructuring Charges
   24. Other Non-Operating Income (Expense)
 Year EndedDecember 31,
    
    
    December 30,
    
    
    December 28,2006
    
    
    2007
    
    
    2008Gain (loss) on sale and maturity of marketable securities
    
    $
    5
    
    
    $
    (131
    )
    
    $
    36Loss from repurchase and redemption of senior and
convertible notes
    
    
    (500
    )
    
    
    
    
    
    
    Other income (expense), net
    
    
    603
    
    
    
    (311
    )
    
    
    (9
    )$
    108
    
    
    $
    (442
    )
    
    $
    27
 25. Fair Value of Financial Instruments
    Fair value measurementDecember 28, 2008Level 1
    
    
    Level 2
    
    
    Level 3Assets:Marketable securities
    
    $
    56,901
    
    
    $
    
    
    
    $
    $
    56,901
    
    
    $
    
    
    
    $
    Liabilities:Foreign currency forward contracts
    
    $
    
    
    
    $
    7,078
    
    
    $
    $
    
    
    
    $
    7,078
    
    
    $
    
 F-38




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
   Estimated Fair ValueDecember 28, 2008Level 1
    
    
    Level 2
    
    
    Level 3Liabilities:Senior notes
    
    $
    
    
    
    $
    268,250
    
    
    $
    $
    
    
    
    $
    268,250
    
    
    $
    
    Cash and cash equivalents
  Marketable securities
  Restricted cash
  Short-term borrowings and long-term debts
  Senior and convertible notes
  F-39




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 Limitations
   December 30, 2007Carrying
    
    EstimatedAmount
    
    Fair ValueFinancial Assets:Cash and cash equivalents
    
    $
    213,461
    
    
    $
    213,461Marketable securities
    
    
    44,526
    
    
    
    44,526Restricted cash
    
    
    1,612
    
    
    
    1,612Financial Liabilities:Short-term borrowings
    
    $
    50,300
    
    
    $
    50,300Long-term debts, excluding senior and
convertible notes
    
    
    92,843
    
    
    
    92,805Senior and convertible notes
    
    
    521,491
    
    
    
    540,862
 26. Business Segment, Geographic and Major Customer Data
   Year EndedDecember 31,
    
    
    December 30,
    
    
    December 28,2006
    
    
    2007
    
    
    2008United States packaging  laminate
    
    
    648,258
    
    
    
    690,297
    
    
    
    692,734 packaging  leaded
    
    
    265,012
    
    
    
    259,732
    
    
    
    230,434 test and other services
    
    
    269,939
    
    
    
    283,735
    
    
    
    279,3481,183,209
    
    
    
    1,233,764
    
    
    
    1,202,516Asia packaging  laminate
    
    
    231,946
    
    
    
    213,857
    
    
    
    189,742 packaging  leaded
    
    
    21,861
    
    
    
    32,576
    
    
    
    55,869 test and other services
    
    
    132,720
    
    
    
    121,410
    
    
    
    126,855386,527
    
    
    
    367,843
    
    
    
    372,466Europe packaging  laminate
    
    
    17,585
    
    
    
    25,928
    
    
    
    55,027 packaging  leaded
    
    
    9,610
    
    
    
    11,154
    
    
    
    12,170 test and other services
    
    
    20,002
    
    
    
    12,871
    
    
    
    16,00947,197
    
    
    
    49,953
    
    
    
    83,206Total packaging  laminate
    
    
    897,789
    
    
    
    930,082
    
    
    
    937,503 packaging  leaded
    
    
    296,483
    
    
    
    303,462
    
    
    
    298,473 test and other services
    
    
    422,661
    
    
    
    418,016
    
    
    
    422,212$
    1,616,933
    
    
    $
    1,651,560
    
    
    $
    1,658,188
 F-40




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
  Year EndedDecember 30,
    
    
    December 28,2007
    
    
    2008Singapore
    
    $
    280,371
    
    
    $
    227,636United States
    
    
    20,110
    
    
    
    17,666Rest of Asia
    
    
    976,009
    
    
    
    971,040Total
    
    $
    1,276,490
    
    
    $
    1,216,342
  Year EndedDecember 30,
    
    
    December 28,2007
    
    
    2008Singapore
    
    $
    495,100
    
    
    $
    493,739United States
    
    
    96,369
    
    
    
    136,536Rest of Asia
    
    
    792,500
    
    
    
    918,382Total
    
    $
    1,383,969
    
    
    $
    1,548,657
  27. Recent Event
  28. Condensed Consolidating Financial Information
    F-41




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the Year Ended December 31, 2006
 STATS
    
    
    
    
    
    
    Non -STATS
    
    
    ChipPAC
    
    
    Guarantor
    
    
    GuarantorChipPAC
    
    
    Korea
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedNet revenues
    
    $
    501,660
    
    
    $
    573,502
    
    
    $
    1,083,906
    
    
    $
    289,434
    
    
    $
    (831,569
    )
    
    $
    1,616,933Cost of revenues
    
    
    (400,330
    )
    
    
    (490,533
    )
    
    
    (950,997
    )
    
    
    (240,838
    )
    
    
    791,925
    
    
    
    (1,290,773
    )Gross profit
    
    
    101,330
    
    
    
    82,969
    
    
    
    132,909
    
    
    
    48,596
    
    
    
    (39,644
    )
    
    
    326,160Operating expenses:Selling, general and administrative
    
    
    57,018
    
    
    
    12,453
    
    
    
    90,176
    
    
    
    12,030
    
    
    
    (32,211
    )
    
    
    139,466Research and development
    
    
    10,253
    
    
    
    10,408
    
    
    
    15,962
    
    
    
    1,334
    
    
    
    (7,511
    )
    
    
    30,446Restructuring charges
    
    
    1,938
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,938Total operating expenses
    
    
    69,209
    
    
    
    22,861
    
    
    
    106,138
    
    
    
    13,364
    
    
    
    (39,722
    )
    
    
    171,850Operating income
    
    
    32,121
    
    
    
    60,108
    
    
    
    26,771
    
    
    
    35,232
    
    
    
    78
    
    
    
    154,310Other income (expense), net:Interest income
    
    
    3,468
    
    
    
    389
    
    
    
    2,803
    
    
    
    811
    
    
    
    (2,070
    )
    
    
    5,401Interest expense
    
    
    (35,198
    )
    
    
    (3,507
    )
    
    
    (7,145
    )
    
    
    (2,036
    )
    
    
    2,070
    
    
    
    (45,816
    )Foreign currency exchange gain (loss)
    
    
    89
    
    
    
    (2,874
    )
    
    
    2,303
    
    
    
    (1,142
    )
    
    
    46
    
    
    
    (1,578
    )Equity gain from investment in equity
investee
    
    
    152
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    152Equity gain from investment in
subsidiaries
    
    
    74,478
    
    
    
    
    
    
    
    12,741
    
    
    
    
    
    
    
    (87,219
    )
    
    
    Dividend income from subsidiary
    
    
    2,903
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,903
    )
    
    
    Other non-operating income (expense), net
    
    
    195
    
    
    
    (2
    )
    
    
    (381
    )
    
    
    296
    
    
    
    
    
    
    
    108Total other income (expense), net
    
    
    46,087
    
    
    
    (5,994
    )
    
    
    10,321
    
    
    
    (2,071
    )
    
    
    (90,076
    )
    
    
    (41,733
    )Income before income taxes
    
    
    78,208
    
    
    
    54,114
    
    
    
    37,092
    
    
    
    33,161
    
    
    
    (89,998
    )
    
    
    112,577Income tax expense
    
    
    (1,400
    )
    
    
    (19,624
    )
    
    
    (3,291
    )
    
    
    (1,444
    )
    
    
    
    
    
    
    (25,759
    )Income before minority interest
    
    
    76,808
    
    
    
    34,490
    
    
    
    33,801
    
    
    
    31,717
    
    
    
    (89,998
    )
    
    
    86,818Minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,010
    )
    
    
    (10,010
    )Net income
    
    $
    76,808
    
    
    $
    34,490
    
    
    $
    33,801
    
    
    $
    31,717
    
    
    $
    (100,008
    )
    
    $
    76,808
 F-42




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 31, 2006
 STATS
    
    
    
    
    
    
    Non-STATS
    
    
    ChipPAC
    
    
    Guarantor
    
    
    GuarantorChipPAC
    
    
    Korea
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedCash Flows From Operating ActivitiesNet income
    
    $
    76,808
    
    
    $
    34,490
    
    
    $
    33,801
    
    
    $
    31,717
    
    
    $
    (100,008
    )
    
    $
    76,808Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation and amortization
    
    
    86,748
    
    
    
    53,207
    
    
    
    76,871
    
    
    
    49,570
    
    
    
    (79
    )
    
    
    266,317Amortization of leasing prepayments
    
    
    7,386
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,386Debt issuance cost amortization
    
    
    2,262
    
    
    
    
    
    
    
    109
    
    
    
    
    
    
    
    
    
    
    
    2,371Loss (gain) on sale of property, plant and equipment
    
    
    852
    
    
    
    (16
    )
    
    
    (58
    )
    
    
    473
    
    
    
    
    
    
    
    1,251Accretion of discount on convertible notes
    
    
    6,618
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,618Loss on redemption of convertible notes
    
    
    
    
    
    
    
    
    
    
    500
    
    
    
    
    
    
    
    
    
    
    
    500Foreign currency exchange loss (gain)
    
    
    (220
    )
    
    
    
    
    
    
    
    
    
    
    1,024
    
    
    
    (46
    )
    
    
    758Share-based compensation
    
    
    4,150
    
    
    
    5,244
    
    
    
    3,191
    
    
    
    1,103
    
    
    
    
    
    
    
    13,688Deferred income taxes
    
    
    1,400
    
    
    
    19,515
    
    
    
    (769
    )
    
    
    (293
    )
    
    
    
    
    
    
    19,853Minority interest in income of subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,010
    
    
    
    10,010Equity income from investment in subsidiaries
    
    
    (74,479
    )
    
    
    
    
    
    
    (12,741
    )
    
    
    
    
    
    
    87,220
    
    
    
    Equity income from investment in equity investee
    
    
    (152
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (152
    )Gain on sale of marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5
    )
    
    
    
    
    
    
    (5
    )Others
    
    
    487
    
    
    
    175
    
    
    
    137
    
    
    
    210
    
    
    
    
    
    
    
    1,009Changes in operating working capital:Accounts receivable
    
    
    15,170
    
    
    
    
    
    
    
    (23,298
    )
    
    
    5,339
    
    
    
    
    
    
    
    (2,789
    )Amounts due from affiliates
    
    
    (120,238
    )
    
    
    (6,398
    )
    
    
    4,780
    
    
    
    (12,221
    )
    
    
    138,381
    
    
    
    4,304Inventories
    
    
    (11,631
    )
    
    
    (9,984
    )
    
    
    (1,893
    )
    
    
    (8,760
    )
    
    
    
    
    
    
    (32,268
    )Other receivables, prepaid expenses and other assets
    
    
    6,358
    
    
    
    (451
    )
    
    
    (298
    )
    
    
    1,746
    
    
    
    
    
    
    
    7,355Accounts payable, accrued operating expenses and
other payables
    
    
    2,973
    
    
    
    10,070
    
    
    
    415
    
    
    
    31,316
    
    
    
    
    
    
    
    44,774Amounts due to affiliates
    
    
    10,052
    
    
    
    (13,953
    )
    
    
    137,559
    
    
    
    4,706
    
    
    
    (138,381
    )
    
    
    (17
    )Net cash provided by operating activities
    
    
    14,544
    
    
    
    91,899
    
    
    
    218,306
    
    
    
    105,925
    
    
    
    (2,903
    )
    
    
    427,771Cash Flows From Investing ActivitiesProceeds from sales of marketable securities
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    35,391
    
    
    $
    
    
    
    $
    35,391Proceeds from maturity of marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,841
    
    
    
    
    
    
    
    20,841Purchases of marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (80,866
    )
    
    
    
    
    
    
    (80,866
    )Cash injection in subsidiaries
    
    
    (7,517
    )
    
    
    
    
    
    
    (54,500
    )
    
    
    
    
    
    
    62,017
    
    
    
    Investment in equity investee
    
    
    (10,154
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,154
    )Acquisition of intangible assets
    
    
    (1,835
    )
    
    
    (1,151
    )
    
    
    (3,012
    )
    
    
    (421
    )
    
    
    
    
    
    
    (6,419
    )Purchases of property, plant and equipment
    
    
    (96,176
    )
    
    
    (94,167
    )
    
    
    (72,208
    )
    
    
    (157,913
    )
    
    
    26,821
    
    
    
    (393,643
    )Proceeds from sale of assets held for sale
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,027
    
    
    
    
    
    
    
    4,027Others, net
    
    
    12,100
    
    
    
    6,139
    
    
    
    7,199
    
    
    
    6,423
    
    
    
    (26,821
    )
    
    
    5,040Net cash used in investing activities
    
    
    (103,582
    )
    
    
    (89,179
    )
    
    
    (122,521
    )
    
    
    (172,518
    )
    
    
    62,017
    
    
    
    (425,783
    )Cash Flows From Financing ActivitiesRepayment of short-term debts
    
    $
    
    
    
    $
    (21,496
    )
    
    $
    
    
    
    $
    (20,794
    )
    
    $
    
    
    
    $
    (42,290
    )Repayment of long-term debts
    
    
    
    
    
    
    (690
    )
    
    
    
    
    
    
    (26,937
    )
    
    
    
    
    
    
    (27,627
    )Proceeds from issuance of shares, net of expenses
    
    
    13,254
    
    
    
    
    
    
    
    
    
    
    
    62,017
    
    
    
    (62,017
    )
    
    
    13,254Repurchase and redemption of senior and convertible
notes
    
    
    
    
    
    
    
    
    
    
    (50,500
    )
    
    
    
    
    
    
    
    
    
    
    (50,500
    )Proceeds from bank borrowings
    
    
    
    
    
    
    16,653
    
    
    
    
    
    
    
    43,655
    
    
    
    
    
    
    
    60,308Decrease in restricted cash
    
    
    
    
    
    
    116
    
    
    
    
    
    
    
    1,511
    
    
    
    
    
    
    
    1,627Capital lease payments
    
    
    
    
    
    
    (7,091
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,091
    )Distribution to minority interest in subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,445
    )
    
    
    2,903
    
    
    
    (2,542
    )Net cash provided by (used in) financing activities
    
    
    13,254
    
    
    
    (12,508
    )
    
    
    (50,500
    )
    
    
    54,007
    
    
    
    (59,114
    )
    
    
    (54,861
    )Net increase (decrease) in cash and cash equivalents
    
    
    (75,784
    )
    
    
    (9,788
    )
    
    
    45,285
    
    
    
    (12,586
    )
    
    
    
    
    
    
    (52,873
    )Effect of exchange rate changes on cash and cash
equivalents
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (390
    )
    
    
    
    
    
    
    (390
    )Cash and cash equivalents at beginning of the year
    
    
    144,841
    
    
    
    32,291
    
    
    
    10,500
    
    
    
    37,088
    
    
    
    
    
    
    
    224,720Cash and cash equivalents at end of the year
    
    $
    69,057
    
    
    $
    22,503
    
    
    $
    55,785
    
    
    $
    24,112
    
    
    $
    
    
    
    $
    171,457
 F-43




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 CONDENSED CONSOLIDATING BALANCE SHEETS
As of December 30, 2007
 STATS
    
    
    
    
    
    
    Non -STATS
    
    
    ChipPAC
    
    
    Guarantor
    
    
    GuarantorChipPAC
    
    
    Korea
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedASSETSCurrent assets:Cash and cash equivalents
    
    $
    91,813
    
    
    $
    25,224
    
    
    $
    65,945
    
    
    $
    30,479
    
    
    $
    
    
    
    $
    213,461Short-term marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    29,230
    
    
    
    
    
    
    
    29,230Accounts receivable, net
    
    
    72,827
    
    
    
    
    
    
    
    183,486
    
    
    
    15,047
    
    
    
    
    
    
    
    271,360Short-term amounts due from affiliates
    
    
    440,518
    
    
    
    38,005
    
    
    
    141,656
    
    
    
    65,932
    
    
    
    (676,819
    )
    
    
    9,292Other receivables
    
    
    2,527
    
    
    
    2,716
    
    
    
    904
    
    
    
    730
    
    
    
    
    
    
    
    6,877Inventories
    
    
    19,614
    
    
    
    38,516
    
    
    
    11,680
    
    
    
    13,502
    
    
    
    
    
    
    
    83,312Prepaid expenses and other current assets
    
    
    5,276
    
    
    
    2,589
    
    
    
    11,170
    
    
    
    3,285
    
    
    
    
    
    
    
    22,320Total current assets
    
    
    632,575
    
    
    
    107,050
    
    
    
    414,841
    
    
    
    158,205
    
    
    
    (676,819
    )
    
    
    635,852Long-term marketable securities
    
    
    15,296
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,296Long-term amounts due from affiliates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,852
    
    
    
    
    
    
    
    6,852Property, plant and equipment, net
    
    
    280,371
    
    
    
    382,420
    
    
    
    289,828
    
    
    
    323,871
    
    
    
    
    
    
    
    1,276,490Investment in equity investee
    
    
    10,350
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,350Investment in subsidiaries
    
    
    995,948
    
    
    
    
    
    
    
    111,167
    
    
    
    
    
    
    
    (1,107,115
    )
    
    
    Intangible assets
    
    
    5,646
    
    
    
    1,586
    
    
    
    30,495
    
    
    
    3,027
    
    
    
    
    
    
    
    40,754Goodwill
    
    
    
    
    
    
    316,067
    
    
    
    125,800
    
    
    
    103,882
    
    
    
    2,209
    
    
    
    547,958Long-term restricted cash
    
    
    
    
    
    
    629
    
    
    
    614
    
    
    
    369
    
    
    
    
    
    
    
    1,612Prepaid expenses and other non-current assets
    
    
    15,055
    
    
    
    27,061
    
    
    
    1,406
    
    
    
    18,268
    
    
    
    
    
    
    
    61,790Total assets
    
    $
    1,955,241
    
    
    $
    834,813
    
    
    $
    974,151
    
    
    $
    614,474
    
    
    $
    (1,781,725
    )
    
    $
    2,596,954LIABILITIES AND SHAREHOLDERS
EQUITYCurrent liabilities:Accounts and other payables
    
    $
    14,024
    
    
    $
    76,254
    
    
    $
    28,780
    
    
    $
    45,242
    
    
    $
    
    
    
    $
    164,300Payables related to property, plant
and equipment purchases
    
    
    13,422
    
    
    
    35,486
    
    
    
    11,350
    
    
    
    10,486
    
    
    
    
    
    
    
    70,744Accrued operating expenses
    
    
    48,028
    
    
    
    12,091
    
    
    
    37,554
    
    
    
    11,843
    
    
    
    
    
    
    
    109,516Income taxes payable
    
    
    
    
    
    
    7,682
    
    
    
    2,718
    
    
    
    6,850
    
    
    
    
    
    
    
    17,250Short-term borrowings
    
    
    50,000
    
    
    
    
    
    
    
    
    
    
    
    300
    
    
    
    
    
    
    
    50,300Short-term amounts due to affiliates
    
    
    58,447
    
    
    
    87,560
    
    
    
    485,123
    
    
    
    47,340
    
    
    
    (676,819
    )
    
    
    1,651Current installments of long-term debts
    
    
    21,991
    
    
    
    6,000
    
    
    
    154,500
    
    
    
    7,990
    
    
    
    
    
    
    
    190,481Total current liabilities
    
    
    205,912
    
    
    
    225,073
    
    
    
    720,025
    
    
    
    130,051
    
    
    
    (676,819
    )
    
    
    604,242Long-term debts, excluding current installments
    
    
    365,000
    
    
    
    6,600
    
    
    
    26,800
    
    
    
    25,453
    
    
    
    
    
    
    
    423,853Other non-current liabilities
    
    
    360
    
    
    
    95,377
    
    
    
    19,067
    
    
    
    10,289
    
    
    
    
    
    
    
    125,093Total liabilities
    
    
    571,272
    
    
    
    327,050
    
    
    
    765,892
    
    
    
    165,793
    
    
    
    (676,819
    )
    
    
    1,153,188Minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    59,797
    
    
    
    59,797Total shareholders equity
    
    
    1,383,969
    
    
    
    507,763
    
    
    
    208,259
    
    
    
    448,681
    
    
    
    (1,164,703
    )
    
    
    1,383,969Total liabilities and shareholders equity
    
    $
    1,955,241
    
    
    $
    834,813
    
    
    $
    974,151
    
    
    $
    614,474
    
    
    $
    (1,781,725
    )
    
    $
    2,596,954
 F-44




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the Year Ended December 30, 2007
 STATS
    
    
    
    
    
    
    Non -STATS
    
    
    ChipPAC
    
    
    Guarantor
    
    
    GuarantorChipPAC
    
    
    Korea
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedNet revenues
    
    $
    432,058
    
    
    $
    613,248
    
    
    $
    1,199,553
    
    
    $
    333,329
    
    
    $
    (926,628
    )
    
    $
    1,651,560Cost of revenues
    
    
    330,428
    
    
    
    526,608
    
    
    
    1,077,722
    
    
    
    278,235
    
    
    
    (882,709
    )
    
    
    1,330,284Gross profit
    
    
    101,630
    
    
    
    86,640
    
    
    
    121,831
    
    
    
    55,094
    
    
    
    (43,919
    )
    
    
    321,276Operating expenses:Selling, general and administrative
    
    
    54,715
    
    
    
    15,336
    
    
    
    65,966
    
    
    
    9,887
    
    
    
    (33,311
    )
    
    
    112,593Research and development
    
    
    13,931
    
    
    
    10,262
    
    
    
    19,522
    
    
    
    1,833
    
    
    
    (10,630
    )
    
    
    34,918Tender offer expenses
    
    
    10,119
    
    
    
    
    
    
    
    803
    
    
    
    
    
    
    
    
    
    
    
    10,922Impairment of assets held for sale
    
    
    
    
    
    
    
    
    
    
    1,725
    
    
    
    
    
    
    
    
    
    
    
    1,725Restructuring charges
    
    
    990
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    990Total operating expenses
    
    
    79,755
    
    
    
    25,598
    
    
    
    88,016
    
    
    
    11,720
    
    
    
    (43,941
    )
    
    
    161,148Operating income
    
    
    21,875
    
    
    
    61,042
    
    
    
    33,815
    
    
    
    43,374
    
    
    
    22
    
    
    
    160,128Other income (expense), net:Interest income
    
    
    3,807
    
    
    
    425
    
    
    
    4,086
    
    
    
    971
    
    
    
    (2,031
    )
    
    
    7,258Interest expense
    
    
    (33,904
    )
    
    
    (3,094
    )
    
    
    (4,187
    )
    
    
    (1,296
    )
    
    
    2,031
    
    
    
    (40,450
    )Foreign currency exchange gain
    
    
    1,968
    
    
    
    322
    
    
    
    179
    
    
    
    18
    
    
    
    
    
    
    
    2,487Equity gain from investment in equity
investee
    
    
    102
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    102Equity gain from investment in
subsidiaries
    
    
    99,636
    
    
    
    
    
    
    
    24,735
    
    
    
    
    
    
    
    (124,371
    )
    
    
    Dividend income from subsidiary
    
    
    5,486
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,486
    )
    
    
    Other non-operating income (expense), net
    
    
    (3,286
    )
    
    
    3,429
    
    
    
    (877
    )
    
    
    292
    
    
    
    
    
    
    
    (442
    )Total other income (expense), net
    
    
    73,809
    
    
    
    1,082
    
    
    
    23,936
    
    
    
    (15
    )
    
    
    (129,857
    )
    
    
    (31,045
    )Income before income taxes
    
    
    95,684
    
    
    
    62,124
    
    
    
    57,751
    
    
    
    43,359
    
    
    
    (129,835
    )
    
    
    129,083Income tax expense
    
    
    2,000
    
    
    
    11,402
    
    
    
    7,583
    
    
    
    8,596
    
    
    
    
    
    
    
    29,581Income before minority interest
    
    
    93,684
    
    
    
    50,722
    
    
    
    50,168
    
    
    
    34,763
    
    
    
    (129,835
    )
    
    
    99,502Minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,818
    )
    
    
    (5,818
    )Net income
    
    $
    93,684
    
    
    $
    50,722
    
    
    $
    50,168
    
    
    $
    34,763
    
    
    $
    (135,653
    )
    
    
    93,684
 F-45




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 30, 2007
 STATS
    
    
    
    
    
    
    Non-STATS
    
    
    ChipPAC
    
    
    Guarantor
    
    
    GuarantorChipPAC
    
    
    Korea
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedCash Flows From Operating ActivitiesNet income
    
    
    93,684
    
    
    
    50,722
    
    
    
    50,168
    
    
    
    34,763
    
    
    
    (135,653
    )
    
    
    93,684Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation and amortization
    
    
    84,095
    
    
    
    65,509
    
    
    
    54,937
    
    
    
    49,818
    
    
    
    (7
    )
    
    
    254,352Amortization of leasing prepayments
    
    
    11
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11Debt issuance cost amortization
    
    
    2,446
    
    
    
    
    
    
    
    115
    
    
    
    
    
    
    
    
    
    
    
    2,561Loss (gain) on sale of property, plant and equipment
    
    
    1,090
    
    
    
    (1
    )
    
    
    (36
    )
    
    
    (1,070
    )
    
    
    
    
    
    
    (17
    )Impairment of assets held for sale
    
    
    
    
    
    
    
    
    
    
    1,725
    
    
    
    
    
    
    
    
    
    
    
    1,725Accretion of discount on convertible notes
    
    
    4,830
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,830Foreign currency exchange loss (gain)
    
    
    (16
    )
    
    
    
    
    
    
    
    
    
    
    755
    
    
    
    (15
    )
    
    
    724Share-based compensation
    
    
    3,192
    
    
    
    3,958
    
    
    
    1,531
    
    
    
    188
    
    
    
    
    
    
    
    8,869Deferred income taxes
    
    
    2,000
    
    
    
    (9,079
    )
    
    
    2,490
    
    
    
    914
    
    
    
    
    
    
    
    (3,675
    )Minority interest in income of subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,818
    
    
    
    5,818Equity income from investment in subsidiaries
    
    
    (99,636
    )
    
    
    
    
    
    
    (24,735
    )
    
    
    
    
    
    
    124,371
    
    
    
    Equity income from investment in equity investee
    
    
    (102
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (102
    )Others
    
    
    280
    
    
    
    (17
    )
    
    
    59
    
    
    
    1,282
    
    
    
    
    
    
    
    1,604Changes in operating working capital:Accounts receivable
    
    
    2,828
    
    
    
    
    
    
    
    (30,059
    )
    
    
    (350
    )
    
    
    
    
    
    
    (27,581
    )Amounts due from affiliates
    
    
    55,562
    
    
    
    (23,032
    )
    
    
    (40,574
    )
    
    
    (46,951
    )
    
    
    41,357
    
    
    
    (13,638
    )Inventories
    
    
    17,382
    
    
    
    3,354
    
    
    
    (3,868
    )
    
    
    12,731
    
    
    
    
    
    
    
    29,599Other receivables, prepaid expenses and other assets
    
    
    4,091
    
    
    
    6,597
    
    
    
    (2,239
    )
    
    
    (1,337
    )
    
    
    
    
    
    
    7,112Accounts payable, accrued operating expenses and
other payables
    
    
    (21,209
    )
    
    
    36,516
    
    
    
    41,981
    
    
    
    (12,996
    )
    
    
    (262
    )
    
    
    44,030Amounts due to affiliates
    
    
    40,330
    
    
    
    12,162
    
    
    
    (20,287
    )
    
    
    10,758
    
    
    
    (41,357
    )
    
    
    1,606Net cash provided by operating activities
    
    
    190,858
    
    
    
    146,689
    
    
    
    31,208
    
    
    
    48,505
    
    
    
    (5,748
    )
    
    
    411,512Cash Flows From Investing ActivitiesProceeds from sales of marketable securities
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    19,660
    
    
    $
    
    
    
    $
    19,660Proceeds from maturity of marketable securities
    
    
    2,614
    
    
    
    
    
    
    
    
    
    
    
    20,985
    
    
    
    
    
    
    
    23,599Purchases of marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (27,450
    )
    
    
    
    
    
    
    (27,450
    )Cash injection in subsidiaries
    
    
    (60,214
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    60,214
    
    
    
    Acquisition of intangible assets
    
    
    (2,247
    )
    
    
    (446
    )
    
    
    (2,500
    )
    
    
    (1,569
    )
    
    
    
    
    
    
    (6,762
    )Acquisition of business
    
    
    
    
    
    
    
    
    
    
    (100,000
    )
    
    
    
    
    
    
    
    
    
    
    (100,000
    )Purchases of property, plant and equipment
    
    
    (43,237
    )
    
    
    (145,307
    )
    
    
    (31,319
    )
    
    
    (46,525
    )
    
    
    34,100
    
    
    
    (232,288
    )Proceeds from sale of assets held for sale
    
    
    
    
    
    
    
    
    
    
    657
    
    
    
    21,172
    
    
    
    
    
    
    
    21,829Others, net
    
    
    16,049
    
    
    
    6,983
    
    
    
    4,228
    
    
    
    9,164
    
    
    
    (34,100
    )
    
    
    2,324Net cash used in investing activities
    
    
    (87,035
    )
    
    
    (138,770
    )
    
    
    (128,934
    )
    
    
    (4,563
    )
    
    
    60,214
    
    
    
    (299,088
    )Cash Flows From Financing ActivitiesRepayment of short-term debts
    
    $
    
    
    
    $
    (48
    )
    
    $
    
    
    
    $
    (6,501
    )
    
    $
    
    
    
    $
    (6,549
    )Repayment of long-term debts
    
    
    (114,118
    )
    
    
    (5,070
    )
    
    
    
    
    
    
    (51,330
    )
    
    
    
    
    
    
    (170,518
    )Proceeds from issuance of shares, net of expenses
    
    
    19,851
    
    
    
    
    
    
    
    58,500
    
    
    
    1,452
    
    
    
    (59,952
    )
    
    
    19,851Repurchase and redemption of senior and convertible
notes
    
    
    (36,800
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (36,800
    )Proceeds from promissory notes
    
    
    
    
    
    
    
    
    
    
    50,000
    
    
    
    
    
    
    
    
    
    
    
    50,000Proceeds from bank borrowings
    
    
    50,000
    
    
    
    3,600
    
    
    
    
    
    
    
    29,257
    
    
    
    
    
    
    
    82,857Increase in restricted cash
    
    
    
    
    
    
    
    
    
    
    (614
    )
    
    
    (17
    )
    
    
    
    
    
    
    (631
    )Capital lease payments
    
    
    
    
    
    
    (3,680
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,680
    )Distribution to minority interest in subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (10,466
    )
    
    
    5,486
    
    
    
    (4,980
    )Net cash provided by (used in) financing activities
    
    
    (81,067
    )
    
    
    (5,198
    )
    
    
    107,886
    
    
    
    (37,605
    )
    
    
    (54,466
    )
    
    
    (70,450
    )Net increase in cash and cash equivalents
    
    
    22,756
    
    
    
    2,721
    
    
    
    10,160
    
    
    
    6,337
    
    
    
    
    
    
    
    41,974Effect of exchange rate changes on cash and cash
equivalents
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30
    
    
    
    
    
    
    
    30Cash and cash equivalents at beginning of the year
    
    
    69,057
    
    
    
    22,503
    
    
    
    55,785
    
    
    
    24,112
    
    
    
    
    
    
    
    171,457Cash and cash equivalents at end of the year
    
    $
    91,813
    
    
    $
    25,224
    
    
    $
    65,945
    
    
    $
    30,479
    
    
    $
    
    
    
    $
    213,461
 F-46




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 CONDENSED CONSOLIDATING BALANCE SHEETS
As of December 28, 2008
 STATS
    
    
    
    
    
    
    Non -STATS
    
    
    ChipPAC
    
    
    Guarantor
    
    
    GuarantorChipPAC
    
    
    Korea
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedASSETSCurrent assets:Cash and cash equivalents
    
    $
    146,281
    
    
    $
    12,807
    
    
    $
    95,239
    
    
    $
    41,589
    
    
    $
    
    
    
    $
    295,916Short-term marketable securities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    41,314
    
    
    
    
    
    
    
    41,314Accounts receivable, net
    
    
    52,301
    
    
    
    
    
    
    
    79,313
    
    
    
    7,906
    
    
    
    
    
    
    
    139,520Short-term amounts due from affiliates
    
    
    645,175
    
    
    
    662
    
    
    
    212,407
    
    
    
    13,157
    
    
    
    (860,610
    )
    
    
    10,791Other receivables
    
    
    2,490
    
    
    
    1,343
    
    
    
    3,881
    
    
    
    643
    
    
    
    
    
    
    
    8,357Inventories
    
    
    13,306
    
    
    
    26,284
    
    
    
    11,237
    
    
    
    9,890
    
    
    
    
    
    
    
    60,717Prepaid expenses and other current assets
    
    
    1,773
    
    
    
    8,488
    
    
    
    2,866
    
    
    
    1,566
    
    
    
    
    
    
    
    14,693Total current assets
    
    
    861,326
    
    
    
    49,584
    
    
    
    404,943
    
    
    
    116,065
    
    
    
    (860,610
    )
    
    
    571,308Long-term marketable securities
    
    
    15,587
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,587Long-term amounts due from affiliates
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,726
    
    
    
    
    
    
    
    13,726Property, plant and equipment, net
    
    
    227,636
    
    
    
    374,189
    
    
    
    297,950
    
    
    
    316,567
    
    
    
    
    
    
    
    1,216,342Investment in equity investee
    
    
    9,001
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,001Investment in subsidiaries
    
    
    1,030,329
    
    
    
    
    
    
    
    92,050
    
    
    
    
    
    
    
    (1,122,379
    )
    
    
    Intangible assets
    
    
    12,024
    
    
    
    1,406
    
    
    
    29,200
    
    
    
    2,132
    
    
    
    
    
    
    
    44,762Goodwill
    
    
    
    
    
    
    319,638
    
    
    
    125,605
    
    
    
    103,680
    
    
    
    2,209
    
    
    
    551,132Long-term restricted cash
    
    
    
    
    
    
    634
    
    
    
    15
    
    
    
    363
    
    
    
    
    
    
    
    1,012Prepaid expenses and other non-current assets
    
    
    9,140
    
    
    
    8,205
    
    
    
    1,033
    
    
    
    5,815
    
    
    
    
    
    
    
    24,193Total assets
    
    $
    2,165,043
    
    
    $
    753,656
    
    
    $
    950,796
    
    
    $
    558,348
    
    
    $
    (1,980,780
    )
    
    $
    2,447,063LIABILITIES AND SHAREHOLDERS
EQUITYCurrent liabilities:Accounts and other payables
    
    $
    11,086
    
    
    $
    44,767
    
    
    $
    30,450
    
    
    $
    31,924
    
    
    $
    
    
    
    $
    118,227Payables related to property, plant
and equipment purchases
    
    
    9,264
    
    
    
    1,561
    
    
    
    13,994
    
    
    
    5,885
    
    
    
    
    
    
    
    30,704Accrued operating expenses
    
    
    52,609
    
    
    
    53,136
    
    
    
    29,114
    
    
    
    13,210
    
    
    
    
    
    
    
    148,069Income taxes payable
    
    
    
    
    
    
    18
    
    
    
    1,792
    
    
    
    1,569
    
    
    
    
    
    
    
    3,379Short-term borrowings
    
    
    50,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    50,000Short-term amounts due to affiliates
    
    
    128,244
    
    
    
    81,588
    
    
    
    611,119
    
    
    
    41,047
    
    
    
    (860,610
    )
    
    
    1,388Current installments of long-term debts
    
    
    
    
    
    
    6,600
    
    
    
    10,000
    
    
    
    10,353
    
    
    
    
    
    
    
    26,953Total current liabilities
    
    
    251,203
    
    
    
    187,670
    
    
    
    696,469
    
    
    
    103,988
    
    
    
    (860,610
    )
    
    
    378,720Long-term debts, excluding current
installments installments
    
    
    365,000
    
    
    
    
    
    
    
    16,800
    
    
    
    14,700
    
    
    
    
    
    
    
    396,500Other non-current liabilities
    
    
    183
    
    
    
    33,221
    
    
    
    18,458
    
    
    
    12,282
    
    
    
    
    
    
    
    64,144Total liabilities
    
    
    616,386
    
    
    
    220,891
    
    
    
    731,727
    
    
    
    130,970
    
    
    
    (860,610
    )
    
    
    839,364Minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    59,042
    
    
    
    59,042Total shareholders equity
    
    
    1,548,657
    
    
    
    532,765
    
    
    
    219,069
    
    
    
    427,378
    
    
    
    (1,179,212
    )
    
    
    1,548,657Total liabilities and shareholders equity
    
    $
    2,165,043
    
    
    $
    753,656
    
    
    $
    950,796
    
    
    $
    558,348
    
    
    $
    (1,980,780
    )
    
    $
    2,447,063
 F-47




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS
For the Year Ended December 28, 2008
 STATS
    
    
    
    
    
    
    Non -STATS
    
    
    ChipPAC
    
    
    Guarantor
    
    
    GuarantorChipPAC
    
    
    Korea
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedNet revenues
    
    $
    412,730
    
    
    $
    621,020
    
    
    $
    1,241,330
    
    
    $
    263,018
    
    
    $
    (879,910
    )
    
    $
    1,658,188Cost of revenues
    
    
    309,296
    
    
    
    560,018
    
    
    
    1,089,030
    
    
    
    257,536
    
    
    
    (832,083
    )
    
    
    1,383,797Gross profit
    
    
    103,434
    
    
    
    61,002
    
    
    
    152,300
    
    
    
    5,482
    
    
    
    (47,827
    )
    
    
    274,391Operating expenses:Selling, general and administrative
    
    
    57,355
    
    
    
    14,002
    
    
    
    72,128
    
    
    
    10,632
    
    
    
    (35,780
    )
    
    
    118,337Research and development
    
    
    15,245
    
    
    
    10,690
    
    
    
    22,133
    
    
    
    1,804
    
    
    
    (12,047
    )
    
    
    37,825Equipment impairment
    
    
    4,940
    
    
    
    6,330
    
    
    
    6,253
    
    
    
    3,568
    
    
    
    
    
    
    
    21,091Accelerated share based compensation
    
    
    1,027
    
    
    
    317
    
    
    
    117
    
    
    
    101
    
    
    
    
    
    
    
    1,562Restructuring charges
    
    
    5,912
    
    
    
    
    
    
    
    12,763
    
    
    
    1,115
    
    
    
    
    
    
    
    19,790Total operating expenses
    
    
    84,479
    
    
    
    31,339
    
    
    
    113,394
    
    
    
    17,220
    
    
    
    (47,827
    )
    
    
    198,605Operating income (loss)
    
    
    18,955
    
    
    
    29,663
    
    
    
    38,906
    
    
    
    (11,738
    )
    
    
    
    
    
    
    75,786Other income (expense), net:Interest income
    
    
    2,559
    
    
    
    169
    
    
    
    3,550
    
    
    
    1,438
    
    
    
    (2,031
    )
    
    
    5,685Interest expense
    
    
    (30,583
    )
    
    
    (2,511
    )
    
    
    (3,897
    )
    
    
    (1,026
    )
    
    
    2,031
    
    
    
    (35,986
    )Foreign currency exchange gain (loss)
    
    
    195
    
    
    
    9,809
    
    
    
    (4,923
    )
    
    
    166
    
    
    
    
    
    
    
    5,247Equity gain from investment in equity investee
    
    
    (1,437
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,437
    )Equity gain from investment in subsidiaries
    
    
    37,109
    
    
    
    
    
    
    
    (19,118
    )
    
    
    
    
    
    
    (17,991
    )
    
    
    Dividend income from subsidiary
    
    
    4,664
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,664
    )
    
    
    Other non-operating income (expense), net
    
    
    44
    
    
    
    
    
    
    
    (134
    )
    
    
    117
    
    
    
    
    
    
    
    27Total other income (expense), net
    
    
    12,551
    
    
    
    7,467
    
    
    
    (24,522
    )
    
    
    695
    
    
    
    (22,655
    )
    
    
    (26,464
    )Income (loss) before income taxes
    
    
    31,506
    
    
    
    37,130
    
    
    
    14,384
    
    
    
    (11,043
    )
    
    
    (22,655
    )
    
    
    49,322Income tax expense
    
    
    5,804
    
    
    
    8,790
    
    
    
    3,616
    
    
    
    962
    
    
    
    
    
    
    
    19,172Income (loss) before minority interest
    
    
    25,702
    
    
    
    28,340
    
    
    
    10,768
    
    
    
    (12,005
    )
    
    
    (22,655
    )
    
    
    30,150Minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,448
    )
    
    
    (4,448
    )Net income (loss)
    
    $
    25,702
    
    
    $
    28,340
    
    
    $
    10,768
    
    
    $
    (12,005
    )
    
    $
    (27,103
    )
    
    $
    25,702
 F-48




---



##### Table of Contents



STATS CHIPPAC LTD. AND SUBSIDIARIES
 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Continued)
In thousands of U.S. Dollars (except per share data)
 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
For the Year Ended December 28, 2008
 STATS
    
    
    
    
    
    
    Non-STATS
    
    
    ChipPAC
    
    
    Guarantor
    
    
    GuarantorChipPAC
    
    
    Korea
    
    
    Subsidiaries
    
    
    Subsidiaries
    
    
    Eliminations
    
    
    ConsolidatedCash Flows From Operating ActivitiesNet income (loss)
    
    $
    25,702
    
    
    $
    28,340
    
    
    $
    10,768
    
    
    $
    (12,005
    )
    
    $
    (27,103
    )
    
    $
    25,702Adjustments to reconcile net income (loss) to net
cash provided by operating activities:Depreciation and amortization
    
    
    78,253
    
    
    
    81,430
    
    
    
    69,536
    
    
    
    54,472
    
    
    
    
    
    
    
    283,691Debt issuance cost amortization
    
    
    2,691
    
    
    
    
    
    
    
    46
    
    
    
    
    
    
    
    
    
    
    
    2,737Asset impairment written off
    
    
    4,940
    
    
    
    6,330
    
    
    
    6,253
    
    
    
    3,568
    
    
    
    
    
    
    
    21,091Loss (gain) on sale of property, plant and equipment
    
    
    1,335
    
    
    
    
    
    
    
    9
    
    
    
    (221
    )
    
    
    
    
    
    
    1,123Accretion of discount on convertible notes
    
    
    66
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    66Foreign currency exchange loss (gain)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,555
    )
    
    
    
    
    
    
    (1,555
    )Share-based compensation
    
    
    1,933
    
    
    
    992
    
    
    
    402
    
    
    
    243
    
    
    
    
    
    
    
    3,570Deferred income taxes
    
    
    5,900
    
    
    
    930
    
    
    
    (684
    )
    
    
    (635
    )
    
    
    
    
    
    
    5,511Minority interest in income of subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,448
    
    
    
    4,448Equity (income) loss from investment in subsidiaries
    
    
    (37,109
    )
    
    
    
    
    
    
    19,118
    
    
    
    
    
    
    
    17,991
    
    
    
    Equity loss from investment in equity investee
    
    
    1,437
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,437Others
    
    
    504
    
    
    
    2,610
    
    
    
    887
    
    
    
    177
    
    
    
    
    
    
    
    4,178Changes in operating working capital:Accounts receivable
    
    
    20,526
    
    
    
    
    
    
    
    104,173
    
    
    
    7,141
    
    
    
    
    
    
    
    131,840Amounts due from affiliates
    
    
    (68,476
    )
    
    
    37,343
    
    
    
    (70,751
    )
    
    
    45,901
    
    
    
    47,610
    
    
    
    (8,373
    )Inventories
    
    
    6,308
    
    
    
    12,232
    
    
    
    443
    
    
    
    3,612
    
    
    
    
    
    
    
    22,595Other receivables, prepaid expenses and other assets
    
    
    (257
    )
    
    
    (577
    )
    
    
    (3,956
    )
    
    
    1,839
    
    
    
    
    
    
    
    (2,951
    )Accounts payable, accrued operating expenses and
other payables
    
    
    54
    
    
    
    (56,801
    )
    
    
    (6,660
    )
    
    
    (11,915
    )
    
    
    
    
    
    
    (75,322
    )Amounts due to affiliates
    
    
    69,797
    
    
    
    (5,972
    )
    
    
    (10,185
    )
    
    
    (6,293
    )
    
    
    (47,610
    )
    
    
    (263
    )Net cash provided by operating activities
    
    
    113,604
    
    
    
    106,857
    
    
    
    119,399
    
    
    
    84,329
    
    
    
    (4,664
    )
    
    
    419,525Cash Flows From Investing ActivitiesProceeds from sales of marketable securities
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    29,755
    
    
    $
    
    
    
    $
    29,755Proceeds from maturity of marketable securities
    
    
    
    
    
    
    
    
    
    
    3,810
    
    
    
    46,331
    
    
    
    
    
    
    
    50,141Purchases of marketable securities
    
    
    
    
    
    
    
    
    
    
    (3,810
    )
    
    
    (89,284
    )
    
    
    
    
    
    
    (93,094
    )Cash injection in subsidiaries
    
    
    (11,031
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,031
    
    
    
    Acquisition of intangible assets
    
    
    (6,811
    )
    
    
    (711
    )
    
    
    (4,555
    )
    
    
    (794
    )
    
    
    
    
    
    
    (12,871
    )Purchases of property, plant and equipment
    
    
    (44,254
    )
    
    
    (126,316
    )
    
    
    (83,279
    )
    
    
    (68,701
    )
    
    
    43,651
    
    
    
    (278,899
    )Proceeds from sale of assets held for sale
    
    
    
    
    
    
    
    
    
    
    9,413
    
    
    
    9,695
    
    
    
    
    
    
    
    19,108Proceeds from deregistration of subsidiary
    
    
    9,654
    
    
    
    
    
    
    
    
    
    
    
    (9,654
    )
    
    
    
    
    
    
    Others, net
    
    
    8,871
    
    
    
    13,758
    
    
    
    7,717
    
    
    
    15,451
    
    
    
    (43,651
    )
    
    
    2,146Net cash used in investing activities
    
    
    (43,571
    )
    
    
    (113,269
    )
    
    
    (70,704
    )
    
    
    (67,201
    )
    
    
    11,031
    
    
    
    (283,714
    )Cash Flows From Financing ActivitiesRepayment of short-term debts
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    (5,035
    )
    
    $
    
    
    
    $
    (5,035
    )Repayment of long-term debts
    
    
    
    
    
    
    (6,000
    )
    
    
    (20,000
    )
    
    
    (7,888
    )
    
    
    
    
    
    
    (33,888
    )Proceeds from issuance of shares, net of expenses
    
    
    6,152
    
    
    
    
    
    
    
    
    
    
    
    11,031
    
    
    
    (11,031
    )
    
    
    6,152Repurchase and redemption of senior and convertible
notes
    
    
    (22,057
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (22,057
    )Proceeds from bank borrowings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,735
    
    
    
    
    
    
    
    4,735Increase in restricted cash
    
    
    
    
    
    
    (5
    )
    
    
    599
    
    
    
    6
    
    
    
    
    
    
    
    600Distribution to minority interest in subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,976
    )
    
    
    4,664
    
    
    
    (4,312
    )Grants received
    
    
    340
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    340Net cash used in financing activities
    
    
    (15,565
    )
    
    
    (6,005
    )
    
    
    (19,401
    )
    
    
    (6,127
    )
    
    
    (6,367
    )
    
    
    (53,465
    )Net increase (decrease) in cash and cash equivalents
    
    
    54,468
    
    
    
    (12,417
    )
    
    
    29,294
    
    
    
    11,001
    
    
    
    
    
    
    
    82,346Effect of exchange rate changes on cash and cash
equivalents
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    109
    
    
    
    
    
    
    
    109Cash and cash equivalents at beginning of the year
    
    
    91,813
    
    
    
    25,224
    
    
    
    65,945
    
    
    
    30,479
    
    
    
    
    
    
    
    213,461Cash and cash equivalents at end of the year
    
    $
    146,281
    
    
    $
    12,807
    
    
    $
    95,239
    
    
    $
    41,589
    
    
    $
    
    
    
    $
    295,916
 F-49