Equity

Micron Shareholders' Equity

Common Stock Repurchases: Our Board of Directors has authorized the discretionary repurchase of up to $1.25 billion of our outstanding common stock, which may be made in open-market purchases, block trades, privately-negotiated transactions, or derivative transactions. During the first nine months of 2016, we repurchased 7 million shares for $125 million (including commissions) through open-market transactions, which were recorded as treasury stock. Through the end of the third quarter of 2016, we had repurchased a total of 49 million shares for $956 million (including commissions) through open-market transactions pursuant to such authorization. Repurchases are subject to market conditions and our ongoing determination of the best use of available cash.

Issued and Outstanding Capped Calls: We have capped calls (with strike prices that range from $9.80 to $10.93 and cap prices that range from $14.51 to $16.04), which were intended to reduce the effect of potential dilution from our convertible notes. The capped calls provide for our receipt of cash or shares, at our election, from our counterparties if the trading price of our stock is above strike prices on their expiration dates, which range from November 2016 to February 2020. The amounts receivable vary based on the trading price of our stock, up to the cap prices. As of June 2, 2016, the dollar value of cash or shares that we would receive from capped calls upon their expiration date ranges from $0, if the trading price of our stock is below strike prices for all capped calls, to $719 million, if the trading price of our stock is at or above the cap prices for all capped calls.

Expiration of Capped Calls: A portion of our 2032C Capped Calls and 2031 Capped Calls expired in the first nine months of 2016. We elected share settlement and received 2 million shares of our stock in the first nine months of 2016, equivalent to $23 million, based on the trading stock price at the time of expiration. The shares received were recorded as treasury stock.

Accumulated Other Comprehensive Income (Loss): Changes in accumulated other comprehensive income (loss) by component for the nine months ended June 2, 2016, were as follows:



	Cumulative Foreign Currency Translation Adjustments			Gains (Losses) on Derivative Instruments, Net			Gains (Losses) on Investments, Net			Pension Liability Adjustments			Total
Balance as of September 3, 2015	$	—		$	(5	)	$	(3	)	$	21		$	13
Other comprehensive income (loss) before reclassifications	(50		)	5			2			(6		)	(49		)
Amount reclassified out of accumulated other comprehensive income (loss)	—			(3		)	—			(1		)	(4		)
Tax effects	—			—			—			2			2
Other comprehensive income (loss)	(50		)	2			2			(5		)	(51		)
Balance as of June 2, 2016	$	(50	)	$	(3	)	$	(1	)	$	16		$	(38	)

Noncontrolling Interests in Subsidiaries



As of	June 2, 2016				September 3, 2015
	Noncontrolling Interest Balance		Noncontrolling Interest Percentage		Noncontrolling Interest Balance		Noncontrolling Interest Percentage
IMFT⁽¹⁾	$	832	49	%	$	829	49	%
MP Mask⁽¹⁾	—		—	%	93		50	%
Other	15		Various		15		Various
	$	847			$	937


⁽¹⁾	IMFT is a variable interest entity. MP Mask was a variable interest entity through May 5, 2016. (See "Variable Interest Entities" note.)

IMFT: Since IMFT's inception in 2006, we have owned 51% of IMFT, a joint venture between us and Intel to manufacture NAND Flash and 3D XPoint memory products for the exclusive use of the members. IMFT is governed by a Board of Managers, for which the number of managers appointed by each member varies based on the members' respective ownership interests. The IMFT joint venture agreement extends through 2024 and includes certain buy-sell rights. On January 5, 2016, we amended the IMFT joint venture agreement to change the dates of the buy-sell rights. Pursuant to the amendment, commencing in January 2016, Intel can put to us, and commencing in January 2019, we can call from Intel, Intel's interest in IMFT, in either case, for an amount equal to the noncontrolling interest balance attributable to Intel at such time. If Intel exercises its put right, we can elect to set the closing date of the transaction to be any time within two years following such election by Intel and can elect to receive financing of the purchase price from Intel for one to two years from the closing date.

IMFT manufactures memory products using designs and technology we develop with Intel. We generally share with Intel the costs of product design and process development activities for NAND Flash and 3D XPoint memory. Our R&D expenses were reduced by reimbursements from Intel of $54 million and $153 million for the third quarter and first nine months of 2016, respectively, and $58 million and $158 million for the third quarter and first nine months of 2015, respectively.

Our sales include Non-Trade Non-Volatile Memory, which primarily consists of products sold to Intel through our IMFT joint venture at long-term negotiated prices approximating cost. Non-Trade Non-Volatile Memory sales were $120 million and $372 million for the third quarter and first nine months of 2016, respectively, and were $110 million and $342 million for the third quarter and first nine months of 2015, respectively.

The following table presents the assets and liabilities of IMFT included in our consolidated balance sheets:



As of	June 2, 2016		September 3, 2015
Assets
Cash and equivalents	$	100	$	134
Receivables	85		79
Inventories	73		65
Other current assets	4		7
Total current assets	262		285
Property, plant, and equipment, net	1,775		1,768
Other noncurrent assets	49		49
Total assets	$	2,086	$	2,102

Liabilities
Accounts payable and accrued expenses	$	196	$	182
Deferred income	8		9
Current debt	17		22
Total current liabilities	221		213
Long-term debt	37		49
Other noncurrent liabilities	96		100
Total liabilities	$	354	$	362

Amounts exclude intercompany balances that were eliminated in our consolidated balance sheets.

Creditors of IMFT have recourse only to IMFT's assets and do not have recourse to any other of our assets.

The following table presents IMFT's distributions to and contributions from its shareholders:



	Quarter Ended				Nine Months Ended
	June 2, 2016		June 4, 2015		June 2, 2016		June 4, 2015
IMFT distributions to Micron	$	36	$	—	$	36	$	6
IMFT distributions to Intel	34		—		34		6
Micron contributions to IMFT	—		85		38		106
Intel contributions to IMFT	—		82		37		102

MP Mask: In 2006, we formed a joint venture with Photronics to produce photomasks for leading-edge and advanced next generation semiconductors. Through May 5, 2016, we and Photronics each owned approximately 50% of MP Mask. We purchased a substantial majority of the photomasks produced by MP Mask pursuant to a supply arrangement. On May 5, 2016 we acquired Photronics' interest in MP Mask for $93 million.

The assets and liabilities of MP Mask included in our September 3, 2015 consolidated balance sheet were as follows:



As of	September 3, 2015
Current assets	$	21
Noncurrent assets (primarily property, plant, and equipment)	180
Current liabilities	21

Amounts exclude intercompany balances that were eliminated in our consolidated balance sheets.

Restrictions on Net Assets

As a result of the reorganization proceedings of the MMJ Companies initiated in March 2012, and for so long as such proceedings continue, the MMJ Group is subject to certain restrictions on dividends, loans, and advances. In addition, our ability to access IMFT's cash and other assets through dividends, loans, or advances, including to finance our other operations, is subject to agreement by Intel. As a result, our total restricted net assets (net assets less intercompany balances and noncontrolling interests) as of June 2, 2016 were $3.17 billion for the MMJ Group and $900 million for IMFT, which included cash and equivalents of $598 million for the MMJ Group and $100 million for IMFT.

As of June 2, 2016, our retained earnings included undistributed earnings from our equity method investees of $281 million.