17-05-24 Qualcomm Motion For Preliminary Injunction

Case 3:17-cv-01010-WQH-JMA Document 35 Filed 05/24/17 PageID.
194 Page 1 of 4
1 Evan R. Chesler (pro hac vice)

(N.Y. Bar No. 1475722)
2 echesler@cravath.com
CRAVATH, SWAINE & MOORE LLP
3 825 Eighth Avenue
New York, NY 10019
4 Telephone: (212) 474-1000
Facsimile: (212) 474-3700
5
David A. Nelson (pro hac vice)
6 (Ill. Bar No. 6209623)
davenelson@quinnemanuel.com
7 QUINN EMANUEL URQUHART & SULLIVAN, LLP
500 West Madison St., Suite 2450
8 Chicago, Illinois 60661
Telephone: (312) 705-7400
9 Facsimile: (312) 705-7401
10 Karen P. Hewitt (State Bar No. 145309)
kphewitt@jonesday.com
11 JONES DAY
4655 Executive Drive, Suite 1500
12 San Diego, CA 92121.3134
Telephone: (858) 314-1200
13 Facsimile: (844) 345-3178
14 [Additional counsel identified on signature page]
15 Attorneys for Plaintiff
QUALCOMM INCORPORATED
16
17 UNITED STATES DISTRICT COURT
18 SOUTHERN DISTRICT OF CALIFORNIA
19 QUALCOMM INCORPORATED, NO. 3:17-CV-1010-WQH-JMA
20 Plaintiff, PLAINTIFFS NOTICE OF
MOTION AND MOTION FOR
21 v. PRELIMINARY INJUNCTION
22 COMPAL ELECTRONICS, INC., FIH Date: June 26, 2017
MOBILE LTD., HON HAI
23 PRECISION INDUSTRY CO., LTD, Courtroom: 14B
PEGATRON CORPORATION, and
24 WISTRON CORPORATION, Judge: Hon. William Q. Hayes
25 Defendants. No Oral Argument Unless Requested
by the Court.
26
27 (ORAL ARGUMENT REQUESTED BY MOVING PARTY)
28
PLAINTIFFS NOTICE OF MOTION FOR CASE NO. 3:17-CV-1010-WQH-JMA
PRELIMINARY INJUNCTION
Case 3:17-cv-01010-WQH-JMA Document 35 Filed 05/24/17 PageID.195 Page 2 of 4
1 PLEASE TAKE NOTICE THAT on June 26, 2017 in the above-referenced

2 Court, Plaintiff Qualcomm Incorporated (Qualcomm) will and hereby does move
3 this Court pursuant to Federal Rule of Civil Procedure 65 for a preliminary
4 injunction enjoining Compal Electronics Inc., FIH Mobile Ltd., Hon Hai Precision
5 Industry Co., Ltd., Pegatron Corporation, and Wistron Corporation from violating
6 their license agreements during the pendency of this litigation.
7 A preliminary injunction is necessary because Qualcomm is likely to prevail
8 on the merits in this breach of contract action, Qualcomm will continue to suffer
9 irreparable harm in the absence of an injunction, the balance of harms weighs
10 strongly in favor of Qualcomm, and the public interest supports the entry of a
11 preliminary injunction in the circumstances of this case. This motion is based upon
12 this Notice of Motion and Motion for Preliminary Injunction, the accompanying
13 Memorandum of Points and Authorities in Support of Plaintiff Qualcomm
14 Incorporateds Motion for Preliminary Injunction, the supporting Declarations of
15 Alex Rogers, Abbaseh Samimi, James Cathey, Vanessa A. Lavely, and the exhibits
16 thereto, as well as the argument of counsel, the files and records in this action, and
17 such oral and documentary evidence as may be presented to the Court.
18 WHEREFORE, Qualcomm respectfully requests that this Court preliminarily
19 enjoin defendants Compal Electronics Inc., FIH Mobile Ltd., Hon Hai Precision
20 Industry Co., Ltd., Pegatron Corporation, and Wistron Corporation from violating
21 the terms and conditions of their license agreements during the pendency of this
22 litigation.
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PRELIMINARY INJUNCTION -2-
1 Dated: May 24, 2017 Respectfully submitted,

2
3 By: /s/ Evan R. Chesler
4
(N.Y. Bar No. 1475722)
Keith R. Hummel (pro hac vice)
7 (N.Y. Bar No. 2430668)
khummel@cravath.com
8 Richard J. Stark (pro hac vice)
(N.Y. Bar No. 2472603)
9 rstark@cravath.com
Antony L. Ryan (pro hac vice)
10 (N.Y. Bar No. 2784817)
aryan@cravath.com
11 Gary A. Bornstein (pro hac vice)
(N.Y. Bar No. 2916815)
12 gbornstein@cravath.com
J. Wesley Earnhardt (pro hac vice)
13 (N.Y. Bar No. 4331609)
wearnhardt@cravath.com
14 Yonatan Even (pro hac vice)
(N.Y. Bar No. 4339651 )
15 yeven@cravath.com
Vanessa A. Lavely (pro hac vice)
16 (N.Y. Bar No. 4867412)
vlavely@cravath.com
17 Worldwide Plaza, 825 Eighth Avenue
New York, NY 10019
18 Telephone: (212) 474-1000
Facsimile: (212) 474-3700
19
QUINN EMANUEL URQUHART &
20 SULLIVAN, LLP
21 (Ill. Bar No. 6209623)
22 Stephen Swedlow (pro hac vice)
(Ill. Bar No. 6234550)
23 stephenswedlow@quinnemanuel.com
Telephone: (312) 705-7400
25 Facsimile: (312) 705-7401
26
27
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1 Alexander Rudis (pro hac vice)

2 (N.Y. Bar No. 4232591)
alexanderrudis@quinnemanuel.com
3 51 Madison Ave., 22nd Floor
New York, New York 10010
4 Telephone: (212) 849-7000
Facsimile: (212) 849-7100
5
Sean S. Pak (SBN 219032)
6 seanpak@quinnemanuel.com
50 California St., 22nd Floor
7 San Francisco, CA 94111
Telephone: (415) 875-6600
8 Facsimile: (415) 875-6700
9
JONES DAY
10 Karen P. Hewitt (SBN 145309)
11 Randall E. Kay (SBN 149369)
rekay@jonesday.com
12 4655 Executive Drive, Suite 1500
San Diego, California 92121
13 Telephone: (858) 314-1200
Facsimile: (858) 345-3178
14
Attorneys for Plaintiff
15 QUALCOMM INCORPORATED
16
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Case 3:17-cv-01010-WQH-JMA Document 35-1 Filed 05/24/17 PageID.198 Page 1 of 32
1 Evan R. Chesler (pro hac vice) (N.Y. Bar No. 1475722)

echesler@cravath.com
2 CRAVATH, SWAINE & MOORE LLP
825 Eighth Avenue
3 New York, NY 10019
Telephone: (212) 474-1000
4 Facsimile: (212) 474-3700
5 David A. Nelson (pro hac vice) (Ill. Bar No. 6209623)
Telephone: (312) 705-7400
8 Facsimile: (312) 705-7401
10 JONES DAY
11 San Diego, California 92121
Telephone: (858) 314-1200
12 Facsimile: (858) 345-3178
13 [Additional counsel identified on signature page]
15
UNITED STATES DISTRICT COURT
16
SOUTHERN DISTRICT OF CALIFORNIA
17
18 QUALCOMM INCORPORATED, Case No. 3:17-CV-01010-WQH-JMA
Plaintiff, REDACTED MEMORANDUM
19
v. OF POINTS AND
20 AUTHORITIES IN SUPPORT
COMPAL ELECTRONICS, INC., OF PLAINTIFF QUALCOMM
21 FIH MOBILE LTD., HON HAI INCORPORATEDS MOTION
PRECISION INDUSTRY CO., LTD, FOR PRELIMINARY
22 PEGATRON CORPORATION, and INJUNCTION
WISTRON CORPORATION,
23 Date: June 26, 2017
24 Defendants. Courtroom: 14B
Judge: Hon. William Q. Hayes
25
No Oral Argument Unless Requested
26 by the Court.
27
(ORAL ARGUMENT REQUESTED BY MOVING PARTY)
28 QUALCOMMS MEMORANDUM OF POINTS CASE NO. 3:17-CV-1010-WQH-JMA
AND AUTHORITIES
1 TABLE OF CONTENTS
2 Page
3 TABLE OF AUTHORITIES ................................................................................ ii
4 INTRODUCTION ................................................................................................ 1
5 FACTUAL BACKGROUND ............................................................................... 5
A. The Parties and Their Contractual Relationships. .............................. 5
6
B. ................. 8
7
ARGUMENT.......................................................................................................11
8
I. Applicable Legal Standards. ......................................................................11
9 II. Qualcomm Is Highly Likely to Succeed on the Merits. ..............................12
10 A. Qualcomm Has a Valid Contract with Each Defendant. ...................12
11 B. Defendants Have Breached Their License Agreements. ...................12
12 C. Qualcomm Has Performed Its Obligations. ......................................13
13 D. Qualcomm Is Entitled to Specific Performance. ...............................13
III. Qualcomm Will Suffer Irreparable Harm Absent a Preliminary
14 Injunction...................................................................................................16
15 A. Indefinite Non-Payment of Royalties Is Irreparable Harm. ..............16
16 B. ...............17
17 1. Damage to Goodwill, Reputation and Customer
Relations. ...............................................................................17
18
2. Threatened Disruption
19 Program and a Multitude of Lawsuits. ...................................20
20 3. Decreased Competitive Advantage and Intellectual
Property Development Due to Lost R&D Opportunities. .......22
21
C. Difficulties in Collecting Future Damages Awards from
22 Foreign Defendants. .........................................................................23
23 IV. The Balance of Hardships Weighs Decidedly in Qualc ........24
24 V. The Public Interest Supports a Preliminary Injunction. ..............................25
25 CONCLUSION ...................................................................................................25
26
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QUALCOMM S MEMORANDUM OF POINTS -i- CASE NO. 3:17-CV-1010-WQH-JMA
AND AUTHORITIES
1 TABLE OF AUTHORITIES
Cases Page(s)
2
3 Aevoe Corp. v. Shenzhen Membrane Precise Electron Ltd.,
No. 2:12-CV-00054-GMN, 2012 WL 1532308 (D. Nev. May 1,
4 2012) .............................................................................................................. 23
5 Alliance for the Wild Rockies v. Cottrell,
632 F.3d 1127 (9th Cir. 2011) ............................................................. 11, 16, 25
6
, Inc.,
7 No. C 10-3428, 2013 WL 557102 (N.D. Cal. Feb. 12, 2013) .......................... 25
8 Brown v. Grimes,
9 120 Cal. Rptr. 3d 893 (Ct. App. 2011) ............................................................ 14
Chemular, Inc. v. Ford,
10
No. S-CV-0039036, 2017 WL 1510025 (Cal. Super. Ct. Apr. 6,
11 2017) ........................................................................................................ 18, 22
12 ,
107 F.2d 27 (3d Cir. 1939) .............................................................................. 25
13
Commonwealth Sci. & Indus. Research Org. v. Buffalo Tech. Inc.,
14 492 F. Supp. 2d 600 (E.D. Tex. 2007)................................................. 21, 22, 23
15 Cordelia Lighting, Inc. v. Zhejiang Yankon Grp. Co.,
No. EDCV14881JGBSPX, 2015 WL 12656241 (C.D. Cal. Apr.
16
27, 2015)............................................................................................. 22, 23, 24
17 Disney Enters., Inc. v. VidAngel, Inc.,
18 No. 216CV04109ABPLAX, 2016 WL 8292206, at *11 (C.D. Cal.
Dec. 12, 2016) ................................................................................................ 18
19
Donahue Schriber Realty Grp., Inc. v. Nu Creation Outreach,
20 181 Cal. Rptr. 3d 577 (Ct. App. 2014) ...................................................... 16, 17
21 dge, Inc.,
100 F. Supp. 2d 1058 (N.D. Cal. 2000) ........................................................... 18
22
Fox Television Stations, Inc. v. BarryDriller Content Sys., PLC,
23 915 F. Supp. 2d 1138 (C.D. Cal. 2012) ............................................... 18, 19, 20
24 Greater Yellowstone Coal. v. Timchak,
25 .................................................................... 12
Hand & Nail Harmony, Inc. v. ABC Nail & Spa Prods.,
26
No. SACV160969 ..................................................................................... 18, 19
27
28
QUALCOMM S MEMORANDUM OF POINTS -ii- CASE NO. 3:17-CV-1010-WQH-JMA
AND AUTHORITIES
1 ,
634 F.2d 1197 (9th Cir. 1980) ......................................................................... 16
2 Lansmont Corp. v. SPX Corp.,
3 No. 5:10-CV-05860 EJD, 2012 WL 6096674 (N.D. Cal. Dec. 7,
2012) .................................................................................................. 12, 14, 15
4
Leiva-Perez v. Holder,
5 640 F.3d 962 (9th Cir. 2011) ..................................................................... 11, 16
6 ,
107 Cal. Rptr. 2d 645 (Ct. App. 2001) ............................................................ 12
7
Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd.,
8 518 F. Supp. 2d 1197 (C.D. Cal. 2007) ..................................................... 17, 21
9 NaturaLawn of Am., Inc. v. W. Grp., LLC,
10 484 F. Supp. 2d 392 (D. Md. 2007)................................................................. 20
PPG Indus., Inc. v. Guardian Indus. Corp.,
11
75 F.3d 1558 (Fed. Cir. 1996) ......................................................................... 25
12 Pharmacia & Upjohn Co. v. Ranbaxy Pharm., Inc.,
13 ........................................................ 22, 23, 24
14 Reuland Elec. Co. v. Burgi E ,
No. CV1309499SJOJCX, 2015 WL 12683953, at *12 (C.D. Cal.
15
Apr. 24, 2015)................................................................................................. 15
16 Right Site Coal v. Los Angeles Unified Sch. Dist.,
17 160 Cal. App. 4th 336, 338-39 (2008) ............................................................. 11
18 Rosendahl Corp. v. H. K. Ferguson Co.,
27 Cal. Rptr. 56 (Ct. App. 1962) ..................................................................... 13
19
Tamarind Lithography Workshop, Inc. v. Sanders,
20 193 Cal. Rptr. 409 (Ct. App. 1983) ................................................................. 15
21 Tanner Motor Livery, Ltd. v. Avis, Inc.,
22 316 F.2d 804 (9th Cir. 1963) ........................................................................... 24
Vanda Pharm. Inc. v. Roxane Labs., Inc.,
23
203 F. Supp. 3d 412, 436 (D. Del. 2016)......................................................... 22
24 ,
25 824 F. Supp. 2d 1003 (C.D. Cal. 2011) ..................................................... 18, 20
26 Winter v. Natural Res. Def. Council, Inc.,
555 U.S. 7 (2008)............................................................................................ 11
27
28
QUALCOMM S MEMORANDUM OF POINTS -iii- CASE NO. 3:17-CV-1010-WQH-JMA
AND AUTHORITIES
1 Statutes & Rules
2 Cal. Civ. Proc. Code 526 ................................................................................... 21

3
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QUALCOMM S MEMORANDUM OF POINTS -iv- CASE NO. 3:17-CV-1010-WQH-JMA
AND AUTHORITIES
1 INTRODUCTION
2 Plaintiff brings this motion for
3 preliminary injunctive relief to prevent the irreparable harm it otherwise would
4
5 Apple has instructed Defendants to stop paying billions of dollars in
6 royalties to Qualcomm. Qualcomm is highly likely to succeed on the merits of its
7 claims against Defendants, and the preliminary relief that Qualcomm seeks is
8 nothing more than maintaining the long-standing status quo. Moreover, without
9 preliminary relief, Qualcomm will suffer irreparable harm, including (i) ongoing,
10 indefinite non-payment of very large amounts of royalties; (ii) injury to its core
11 licensing business, including loss of goodwill and harm to its commercial
12 relationships with other licensees; (iii) less cash on hand for ongoing research and
13 development; and (iv) the risk of an unenforceable judgment against foreign
14 Defendants. On the other hand, Defendants face no hardship from preliminary
15 relief they agreed many years ago to precisely the relief that Qualcomm now
16 seeks, and Apple will indemnify them for any payments they are ordered to make.
17 The balance of hardships weigh
18 Qualcomm is the leading innovator in cellular communications and
19 other advanced mobile technologies. For nearly three decades, Qualcomm has
20 created and brought to market core technologies that enable 2G, 3G, and 4G
21 systems and smartphones and is now leading the industry to 5G. Qualcomm owns
22 luable patent portfolios, including thousands of patents
23 that are technically essential to various cellular standards (cellular standard-
24 essential patents, or ). Qualcomm also owns thousands of patents that,
25 while not technically essential to any cellular standard, are essential to other
26 industry standards ( non-cellular SEPs ) or are not technically essential to any
27 industry standard (non-standard- ) but are highly
28
QUALCOMM S MEMORANDUM OF POINTS -1- CASE NO. 3:17-CV-1010-WQH-JMA
AND AUTHORITIES
1 valuable and practiced by most cellular devices.

2 Defendants are four non-U.S. electronics manufacturers, each of which
3 makes and sells wireless products (such as phones and tablets) that comply with
4 3G and 4G LTE cellular standards. As a result, each Defendant makes and sells
5 devices that necessarily practice Qualcomm cellular SEPs. Those devices also
6 practice many Qualcomm NEPs. E
7 intellectual property, and each entered into a license agreement with Qualcomm
8 many years ago. The license agreements are straightforward and unambiguous.
9 In exchange for consideration, including quarterly royalty payments to Qualcomm
10 (calculated as a percentage of the net selling price, or NSP, of each device sold by
11 Defendants), Qualcomm grants Defendants the right to use certain Qualcomm
12 intellectual property to manufacture and sell cellular devices. Each quarter,
13 Defendants send Qualcomm royalty reports detailing the amount of royalties owed
14 for that quarter and, until now, each quarter Defendants have followed through
15 and paid the royalties reported and owed.
16 Defendants do not sell many devices to consumers under their own brands;
17 rather, they sell the vast majority of their devices to other companies that rebrand
18 and then resell the devices to consumers. Apple is each Defendant largest
19 cellular customer. Apple does not manufacture any cellular devices itself. Rather,
20 Apple has hired Defendants to manufacture the iPhones and iPads it designs.
21 Defendants manufacture for Apple virtually every iPhone and iPad sold
22 worldwide. Each Defendant also manufactures cellular devices for other
23 companies, such as . license agreements require them
24 to pay royalties to Qualcomm on Apple and non-Apple devices alike.
25 Apple does not have a patent license from Qualcomm to make and sell
26 iPhones or iPads. Instead, s
27 agreements and has, until now, advanced
28
AND AUTHORITIES
1 payments to Defendants each quarter for the royalties that Defendants owe
2 to Qualcomm for the manufacture and sale of Apple products. Apple knows that
3 it relies s. In fact,
4
5
6
7
8 For many years, the above-described arrangement worked well. Apple paid
9 Defendants the royalties owed to Qualcomm on Apple devices, and Defendants
10 remitted those payments to Qualcomm. Defendants consistently paid royalties to
11 Qualcomm each quarter for Apple products (and non-Apple products).
12 That all changed at the end of 2016. As a result of a dispute between Apple
13 and Qualcomm concerning a different agreement to which Defendants are not
14 parties (the Business Cooperation and Patent Ag
15 royalties equal to the
16 amount that Apple (incorrectly) claims that Qualcomm owes to Apple under the
17 Cooperation Agreement. Apple did pay some royalties due to Qualcomm for sales
18 during the fourth quarter of 2016, only deducting off the top the specific amount
19 at issue in the Cooperation Agreement dispute between Apple and Qualcomm.
20 In so doing, Apple demonstrated that it was willing to use Defendants to try to
21 gain leve
22 Qualcomm the same amount Apple withheld from them in total, nearly
23 $1 billion.
24 agreements, it appeared to be a one-time event arising from the Cooperation
25 Agreement dispute.
26 That turned out not to be the case. Toward the end of January 2017,
27 Apple (i) filed lengthy and wide-ranging complaints around the world challenging
28
AND AUTHORITIES
1 (ii) refused to pay Defendants

2 any Qualcomm royalties; (iii) instructed Defendants not to pay any royalties to
3 Qualcomm, at all, for Apple products, withholding from Qualcomm hundreds of
4 millions of dollars in royalties for sales during the first quarter of 2017 alone; and
5 (iv) agreed to indemnify Defendants against claims that Qualcomm might assert.
6 Moreover, Apple stated that it will continue to withhold all Qualcomm
7 royalties contrary to nearly a decade of past practice and with the deliberate
8 purpose of forcing the Defendants to violate their license agreements until
9 t
10 Qualcomm indefinitely; it has virtually unlimited resources (more than
11 $256 billion in cash reserves) and already has filed multiple cases against
12 Qualcomm not just in this Court, but around the world. And when those cases
13 end, Apple can file more cases. What Apple really means is: Apple will continue
14 to withhold Qualcomm royalties until Apple feels like paying them again, or until
15 Qualcomm surrenders .
16 ch severe, immediate,
17 and permanent harm on Qualcomm that Qualcomm will be forced to agree to
18 licensing demands without first having its day in court.
19 Having filed a complaint with this Court challenging certain aspects of
20 licensing business, Apple is now unwilling to wait for that complaint
21 to be heard. It has chosen commercial ransom over judicial process. At bottom,
22 Apple seeks to pay less than fair value
23 property; it has now shown that it will seek to achieve that result through coercion
24 enabled by its enormous market power.
25 But .
26 Defendants know this. They have consistently paid Qualcomm royalties since the
27 first license agreement was entered into nearly 17 years ago and, tellingly,
28
AND AUTHORITIES
1 continue to pay Qualcomm royalties for non-Apple devices today, under the very
2 same license agreements that govern the Apple products.
3 Qualcomm is in an untenable position. Defendants are manufacturing and
4 selling Apple devices using Qualcomms patents under a valid license; Apple is
5 making extraordinary profits selling those Qualcomm-enabled devices to
6 consumers; meanwhile, Qualcomm is receiving no royalties for the use of its
7 patented technology in those Apple devices; and
8
9 .
10 That harm will continue indefinitely. Qualcomms core business operations
11 will suffer ongoing injury, and its licensing business may be called into question
12 as Apple takes a free ride while other licensees watch. Situations like this are why
13 courts have equitable powers. The proper remedy is to maintain the status quo by
14 immediately enjoining Defendants from violating the terms and conditions of their
15 license agreements during the pendency of this litigation.
16 FACTUAL BACKGROUND
17 A. The Parties and Their Contractual Relationships.
18 Since its founding in 1985, Qualcomm has been designing, developing,
19 and improving cellular communications systems, networks, and products
20 successfully inventing numerous core technologies that have transformed how the
21 world communicates. Qualcomm invented technologies at the heart of 2G, 3G
22 and 4G cellular communications, and is leading the industry to 5G. Every modern
23 cell phone relies upon important Qualcomm technology and practices numerous
24 Qualcomm patents.
25 Qualcomm has invested more than $43 billion in research and development.
26 From 2010 to the present, Qualcomm consistently spent more than 20% of its
27 revenue per year on R&D; in 2016 alone, Qualcomm spent $5 billion on R&D.
28 QUALCOMMS MEMORANDUM OF POINTS -5- CASE NO. 3:17-CV-1010-WQH-JMA
AND AUTHORITIES
1 (Ex. 31 at 14.) Qualcomm now owns more than 130,000 issued patents and patent
2 applications relating to cellular and other advanced technologies, including
3 thousands of cellular and non-cellular SEPs and NEPs. Qualcomm voluntarily
4 licensed its patents to device manufacturers, including Defendants.
5 Separate from licensing business, Qualcomm Technologies,
6 Inc. QTI , designs industry-leading components, such as cellular baseband
7 chips
8 associated software is licensed) for use in making and operating cellular devices.
9 Each Defendant1 like virtually every other major cellular device
10 manufacturer in the world has a royalty-bearing license agreement with
11 Qualcomm. (Lavely Decl. s ) 1-5.) Defendants have enjoyed the
12 benefits of, and have paid royalties under, those agreements for many years now:
13 Compal for nearly 15 years; Foxconn for more than 11 years; Pegatron for nearly
14 7 years; and Wistron for more than 3 years. (Samimi Decl. 9-12.)
15 manufactured by
16 Defendants, including Apple devices, would infringe numerous Qualcomm
17 patents. it the right to manufacture
18 and sell certain cellular devices that practice certain Qualcomm intellectual
19 property, including thousands of Qualcomm cellular and non-cellular SEPs and
20 NEPs. (Exs. 1-2, 4-5 1, 5.) In exchange for the right to use
21 intellectual property, each Defendant agrees to pay royalties to Qualcomm on each
22 device it sells. Specifically,
23
24
25
26
1
27 Defendants are FIH Mobile Ltd. and Hon Hai Precision Industry Co., Ltd., (together,
.
28
AND AUTHORITIES
1 in no way
2 contingent or conditioned on whether Apple pays Defendants.
3 Following execution of their respective license agreements, Defendants
4 began manufacturing cellular devices under the agreements for many of the
5 suppliers of wireless handsets and tablets, including
6 . Each Defendant manufactured non-Apple products before manufacturing
7 Apple products. (Samimi Decl. 9-12.) Compal, for example, manufactured
8 (and paid royalties on) non-Apple products for 12 years before manufacturing
9 Apple products. (Id. 9.) The material terms of the license agreements remained
10 consistent before and after Apple became a customer. (Id. 13.)
11 Apple was a late-comer to the cellular industry. In 2008, Apple released its
12 first 3G iPhone, which used a cellular patented
13 technologies. Apple did not take a direct license from Qualcomm. Instead, Apple
14 outsourced the manufacturing of its iPhones and iPads to Defendants, relying on
15 their existing license agreements with Qualcomm. (Rogers Decl. 6.) Foxconn
16 began manufacturing iPhones (and later iPads) for Apple in 2007; Pegatron began
17 manufacturing iPhones for Apple in 2011; and both Wistron and Compal began
18 manufacturing Apple devices (iPhones by Wistron; iPads by Compal) in 2014.
19 (Samimi Decl. 8-11.) Today, Defendants manufacture virtually every iPhone
20 and iPad worldwide, as well as many non-Apple devices.
21 Apple first began procuring Qualcomm chips and licensing associated
22 software for use in its fourth-generation iPhone, released in 2011. Qualcomm
23 faced fierce competition for those (and later) sales. Taking advantage of that
24 competition, in 2015,
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1
2
3
4 For many years, until the fourth quarter of 2016, each Defendant
5 consistently paid royalties under its license agreement. (Samimi Decl. 15.) For
6 Apple devices, Defendants received payments from Apple and, in turn, paid the
7 royalties due to Qualcomm. Based on this lengthy course of dealing, Defendants
8 and Apple know that Defendan royalty payments to
9 Qualcomm, and by their consistent payment of those royalties, for years and
10 without protest, they have acknowledged the validity of those obligations.
11 B. .
12 On January 20, 2017, Apple sued Qualcomm in this Court. In rapid
13 succession, Apple then filed other lawsuits against Qualcomm in the United
14 Kingdom, China, Japan, and Taiwan.
15 In its January 20 complaint, Apple the wealthiest company in the world,
16 with a quarter of a trillion dollars in cash reserves claimed that
17 from Defendants a substantial portion of Q4 2016
18 royalties due to Qualcomm. Specifically, Apple engaged in unlawful self-help by
19 withholding from Defendants the exact amount it claims Qualcomm owes under
20 the Cooperation Agreement. Apple paid to Defendants the amounts owed in
21 royalties for Q4 2016 sales that exceeded the amount that Apple claims it is owed
22 by Qualcomm under the Cooperation Agreement. (Samimi Decl. 16.) In other
23 words, for Q4 2016 sales, Apple reimbursed Defendants for some royalties owed
24
25 2
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AND AUTHORITIES
1 to Qualcomm under licensing agreements, withholding only the

2 (significant) amount at issue in the Cooperation Agreement dispute, despite Apple
3 already having filed a complaint challenging certain aspects of Qualcomm
4 licensing practices.
5 As Apple intended, Defendants withheld from Qualcomm the same amount
6 of Q4 2016 royalties that Apple withheld from them: Foxconn withheld more
7 than ; Pegatron withheld more than ; and Wistron
8 withheld more than . (Id. 17-19.) Qualcomm made payment
9 demands to these Defendants for Q4 2016 royalties and gave them notice of their
10 non-compliance with their license agreements. (Id.) Certain Defendants admitted
11 that they owed additional royalties but claimed that Apple had prevented full
12 payment. (Id.)
13 Then Apple implemented the next step of its plan. On April 25, 2017,
14 Apple notified Qualcomm that it had not remitted any funds to Defendants for
15 royalties due to Qualcomm for Q1 2017 sales, and that it would not make any
16 royalty payments with respect to royalties owed to Qualcomm until the litigation
17 between Apple and Qualcomm is resolved. (Ex. 16.) Apple then instructed
18 Defendants not to pay Qualcomm royalties for Apple products. (Cathey Decl.
19 7.) And Apple agreed to indemnify Defendants for their breaches. (Id. 6.)
20 After Apple refused to pay Defendants and instructed them not to pay
21 Qualcomm, Defendants refused to pay any Q1 2017 royalties for Apple devices
22 even though they admittedly owe Qualcomm hundreds of millions of dollars. For
23 example, on April 17, 2017, Foxconn certified in its royalty report owes
24 in royalties to QUALCOMM for [Q1 2017] sales [of Apple
25 iPhones] (Samimi Decl. 23; Ex. 20.) A week later, however, Foxconn told
26 Qualcomm
27 [Foxconn] can release pa[y]ment to you. (Ex. 23.) Foxconn later informed
28
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1 Qualcomm that it would not pay its Apple royalties, and that Apple had instructed
2 (Samimi Decl. 23.)
3 Similarly, in an April 27, 2017 email, Compal stated
4 recently formally requested [C]ompal to stop the royalty payment to [Q]ualcomm
5 that [is] associated to their business until legal action is completed. Samimi
6 Decl. 22; Ex. 18.) Apple will
7 not be transmitting funds to [Compal] for the [Q1 2017] quarterly royalty payment
8 will only submit non-
9 (Samimi Decl. 22; Ex. 19.)
10 were required to remit Q1 2017 royalty
11 payments by . (Samimi Decl. 23-25.) was required to
12 remit its Q1 2017 royalty payment by . (Id. 22.) For Apple
13 devices, Defendants admittedly owe Qualcomm approximately for
14 Q1 2017. (Id. 22-24.) Qualcomm made payment demands to each Defendant
15 for Q1 2017 royalties and gave them notice of their non-compliance with their
16 license agreements. (Id. 22-25.) But Defendants still have not paid any
17 royalties for Apple products. (Id. 22-25.)
18 not make royalty payments to Defendants f
19 multi-front litigation offensive against Qualcomm -payment will
20 add up to billions of dollars annually
21 breaches of their patent license agreements, Qualcomm cannot prevent its losses
22 by
23 . Nor should it have to. The agreements between
24 Qualcomm and Defendants are valid and legally binding they should be
25 respected, not just by Defendants, but by third parties, particularly Apple.
26 In the meantime, Qualcomm is receiving no compensation for
27 . While Qualcomm is punished for not
28
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1 subm , Defendants collect billions of dollars in revenue

2 from selling iPhones and iPads to Apple,
3 promise to indemnify them for any claims arising from their breaches. (Cathey
4 Decl. 6.) And Apple continues to make billions of dollars each week from
5 consumers from the sales of those same Qualcomm-enabled products.
6 ARGUMENT
7 I. Applicable Legal Standards.
8 plaintiff seeking a preliminary injunction must establish that he is likely
9 to succeed on the merits, that he is likely to suffer irreparable harm in the absence
10 of preliminary relief, that the balance of equities tips in his favor, and that an
11 injunction is in the public interest. Alliance for the Wild Rockies v. Cottrell,
12 632 F.3d 1127, 1131 (9th Cir. 2011) (quoting Winter v. Natural Res. Def. Council,
13 Inc., 555 U.S. 7, 20 (2008)).
14 Under the sliding scale approach to preliminary injunctions observed in
15 the Ninth Circuit, the elements of the preliminary injunction test are balanced, so
16 that a stronger showing of one element may offs
17 Wild Rockies, 632 F.3d at 1131; see Leiva-Perez v. Holder, 640 F.3d 962, 966 (9th
18 Cir. 2011) authority to balance the elements of the
19 preliminary injunction test, so long as a certain threshold showing is made on each
3
20 Although the Supreme Court in Winter
21 a plaintiff to show a mere possibility of irreparable harm in order to prevail on his
22 request for preliminary injunctive relief, Winter did not reject the sliding scale
23
3
24 There is some debate in the Ninth Circuit district courts about whether to apply the federal or
state standard for a preliminary injunction on a claim under state law. However, California state
25 courts also apply a sliding-scale standard. See, e.g., Right Site Coal v. Los Angeles Unified Sch.
Dist., 160 Cal. App. 4th 336, 338-
26 prevail, the less severe must be the harm that they allege will occur if the injunction does not
. Thus, the choice is immaterial because the tests are largely the same, and Qualcomm
27 satisfies either test here.
28
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1 approach [the Ninth Circuit] employ[s] in the alternative . . . . under which relief is
2 sometimes awarded based on a lower likelihood of harm when the likelihood of
3 success is very high Greater Yellowstone Coal. v. Timchak, 323 F. 512,
4 513-14 n.1 (9th Cir. 2009) (internal citations and quotation marks omitted).
5 II. Qualcomm Is Highly Likely to Succeed on the Merits.
6 Defendants are refusing to pay billions of dollars in royalties that they admit
7 they owe under their license agreements. That is a classic breach of contract.
8 Qualcomm can readily prove (i) the license agreements are valid contracts;
9 (ii) Qualcomm performed its obligations; (iii) Defendants breached; and
10 (iv) Qualcomm suffered injury as a result. Lansmont Corp. v. SPX Corp.,
11 No. 5:10-CV-05860 EJD, 2012 WL 6096674, at *3 (N.D. Cal. Dec. 7, 2012).
12 Qualcomm is highly likely to succeed on the merits of its claims.
13 A. Qualcomm Has a Valid Contract with Each Defendant.
14 Each Defendant has a valid and enforceable license agreement with
15 Qualcomm. (Exs. 1-5.) For many years, Defendants paid Qualcomm royalties
16 under the terms of those license agreements. (Samimi Decl. 9-12, 15.) In fact,
17 Defendants continue to pay royalties under the terms of those license agreements
18 for non-Apple products. (Id. 15-19, 21-25.) That long (and continuing) course
19 of dealing proves the validity of the contracts. E.g., Marin Storage & Trucking,
20 g, Inc., 107 Cal. Rptr. 2d 645, 651 (Ct. App.
21 2001) ( By its conduct in paying the invoices generated from the Work
22 Authorization and Contract forms, Benco acknowledged the existence of a
23 contract. Defendants do not contest the validity and enforceability of the
24 contracts, admitting instead that they are following the instructions of their largest
25 and most powerful customer Apple.
26 B. Defendants Have Breached Their License Agreements.
27 Defendants are required to pay Qualcomm royalties on a quarterly basis.
28
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1 (Exs. 1-2, 4-5 5.) For Q4 2016 sales, according to their own royalty reports,
2 Foxconn withheld more than in royalties; Pegatron withheld more
3 than in royalties; and Wistron withheld more than in
4 royalties. (Samimi Decl. 17-19.)
5 failed to pay any royalties to Qualcomm on Apple devices sold during
6 Q1 2017. (Id. 23-25.) And, on Compal followed suit.
7 (Id. 22.) Collectively, Defendants admit (based on their own royalty reports)
8 that approximately in royalties are due but not paid on Apple
9 products for Q1 2017. (Id. 22-25; Exs. 17, 20-22, 24.) Defendants and Apple
10 have made plain that they will continue withholding royalties on Apple devices
11 indefinitely. (Samimi Decl. 21-23; Ex. 16, 18-19, 23, 25.)
12 Defendants have breached by not paying royalties on Apple products.
13 That is clear under the contracts, and is further demonstrated by
14 long history of full payment on all reported sales, their partial payment on sales of
15 Apple devices in Q4 2016, and their continued full payment for non-Apple
16 devices. See Rosendahl Corp. v. H. K. Ferguson Co., 27 Cal. Rptr. 56, 58 (Ct.
17 App. 1962)
18 to be bound by contract terms).
19 C. Qualcomm Has Performed Its Obligations.
20 Qualcomm has performed its obligations under the license agreements.
21 Qualcomm granted Defendants licenses to use certain of its intellectual property in
22 exchange for royalty payments. And Qualcomm has not sued Defendants or their
23 customers for using the intellectual property covered by the agreements. No
24 Defendant has ch
25 D. Qualcomm Is Entitled to Specific Performance.
26 To obtain specific performance after a breach of contract, a plaintiff must
27 generally show: (1) the inadequacy of his legal remedy; (2) an underlying
28
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1 contract that is both reasonable and supported by adequate consideration; (3) the
2 existence of a mutuality of remedies; (4) contractual terms which are sufficiently
3 definite to enable the court to know what it is to enforce; and (5) a substantial
4 similarity of the requested performance to that promised in the contract.
5 Lansmont Corp., 2012 WL 6096674, at *5. Each factor is met here.
6 First, under the particular f
7 inadequate. In a typical contract case, damages are a sufficient remedy because,
8 if
9 continue performance under the contract is excused, Brown v. Grimes, 120 Cal.
10 Rptr. 3d 893, 902-03 (Ct. App. 2011) (collecting cases), and the plaintiff can
11 terminate the contract and seek monetary damages. In other words, once the
12 harms have been inflicted, the wronged plaintiff can walk away.
13
14 Qualcomm is
15
16
17 Further, the license agreements cover
18 other products that Defendants make for companies aside from Apple. Qualcomm
19 is entitled to continue to maintain the agreements in place.
20 Apple has publicly stated that it will withhold payments from Defendants
21 until its litigation against Qualcomm is resolved (see Exs. 16, 25), and Defendants,
22 and express instructions to them, have told
23 Qualcomm that they will not pay until Apple pays (see, e.g., Exs. 18, 23). In other
24 but Defendants will
25 continue to breach the license agreements indefinitely. If Qualcomm were limited
26 to an award of backward-looking money damages (the legal remedy), Qualcomm
27 would be forced to file a new suit (or amend its complaint) each and every quarter.
28
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1 Qualcomm is entitled to specific performance to avoid that continuous breach of

2 contract[, which] create[s] the danger of an untold number of lawsuits Tamarind
3 Lithography Workshop, Inc. v. Sanders, 193 Cal. Rptr. 409, 412 (Ct. App. 1983);
4 see also Reuland Elec. Co. v. Burgi Eng rs LLC, No. CV1309499SJOJCX, 2015
5 WL 12683953, at *12 (C.D. Cal. Apr. 24, 2015) (awarding specific performance
6 where the legal remedy is inadequate because s] continuous
7 possession or use of [confidential work file] information could constitute a
8 continuous breach of contract ).
9 Second, the parties long history of operating under the license agreements
10 makes clear that the agreements are reasonable and supported by adequate
11 consideration. As noted, as to non-Apple products, Defendants continue to
12 perform under the same terms that apply to Apple products.
13 Third, there is a mutuality of remedies under the license agreements
14 because Defendants would be able to obtain specific performance to enforce the
15 agreements if it were Qualcomm that was breaching.
16 Fourth, the contract terms are sufficiently definite such that the Court can
17 enforce the agreements. In fact, it will be simple to do so. Prior to Q4 2016,
18 Defendants always paid royalties for Apple and non-Apple devices under the
19 terms of the licensing agreements. (Samimi Decl. 15.) Defendants continue to
20 pay royalties on non-Apple devices under the terms of the licensing agreements.
21 (Id.) If Defendants do not want to pay royalties on Apple products, they should
22 stop making and selling Apple products. But there is no ambiguity concerning the
23
24 Fifth, there is a substantial similarity between the remedy requested and the
25 promises given
26 Lansmont Corp., 2012 WL
27 6096674, at *6.
28
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1 III. Qualcomm Will Suffer Irreparable Harm Absent a Preliminary

Injunction.
2
Because Qualcomm is highly likely to prevail on its breach claims the
3
4
Qualcomm need show only some likelihood of irreparable harm to receive a
5
preliminary injunction under the sliding scale standard. See Wild Rockies,
6
632 F.3d at 1131; Leiva-Perez, 640 F.3d at 966. Qualcomm easily satisfies that
7
standard; in fact, Qualcomm is virtually certain to suffer immense irreparable
8
harm starting almost immediately, including (i) ongoing, indefinite non-payment
9
of very large amounts of royalties; (ii) injury core licensing
10
business, and loss of goodwill among other licensees that also make smartphones
11
(and compete with Apple) and yet observe Apple cutting off royalties in an
12
attempt to strong-arm Qualcomm into discriminatorily favorable licensing terms;
13
and (iii) potential difficulties in collecting future damages because Defendants are
14
foreign companies with virtually all of their assets overseas.
15
A. Indefinite Non-Payment of Royalties Is Irreparable Harm.
16
The typical remedy for a breach of contract is monetary damages, and
17
normally
18
Commc l Football League, 634 F.2d 1197, 1202 (9th Cir. 1980)
19
(emphasis added). But that is not always the case.
20
could
21
continue indefinitely, the plaintiff has shown irreparable harm. In a case involving
22
recurring trespass on real property, the California Court of Appeal explained that
23
24
that an injunction may issue to prevent wrongs of a repeated and continuing
25
character, or which occasion damages estimable only by conjecture and not by
26
any accurate standard . Donahue Schriber Realty Grp., Inc. v. Nu Creation
27
Outreach, 181 Cal. Rptr. 3d 577, 587 (Ct. App. 2014) (emphasis added).
28
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1 trespass of a continuing nature, whose constant recurrence renders the remedy

2 at law inadequate, unless by a multiplicity of suits, affords sufficient ground for
3 relief by injunction . Id.
4 That is the situation here. Qualcomm is entitled to a preliminary injunction
5 for the same reason it is entitled to specific performance to avoid ongoing,
6 repeated, and indefinite non-payment of royalties, and the multiplicity of lawsuits
7 that inevitably would follow. See Donahue, 181 Cal. Rptr. 3d at 587; see also
8 Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 518 F. Supp. 2d 1197, 1219
9 (C.D. Cal. 2007) (providing that
10 of an
11
12 Again, in the ordinary case, a licensor could terminate its license agreement
13 if a licensee refuses to pay royalties. But this is not the ordinary case.
14
15
16 In any event, Qualcomm should not be forced to terminate the
17 agreements; among other reasons, they also apply to non-Apple products.
18 Defendants plainly intend to continue breaching the license agreements
19 going forward with respect to Apple products. Qualcomm is left with no recourse,
20 other than indefinite, multiple, serial lawsuits which the law recognizes is an
21 insufficient remedy. Without a preliminary injunction, Qualcomm will experience
22 repeated non-payment of nearly , on average, every calendar quarter into
23 the indefinite future. (See Samimi Decl. 14.) That harm is irreparable.
24 B. H Core Business Is Irreparable Harm.
25 1. Damage to Goodwill, Reputation and Customer Relations.
26 As courts have recognized in a variety of contexts, intangible injuries such
27 as damage to goodwill and reputation, and dissatisfaction among customers
28
AND AUTHORITIES
1 constitute irreparable harm because such damages are not easily calculable or
2 compensable. See eBay, In , 100 F. Supp. 2d 1058, 1066
3 (N.D. Cal. 2000) (
4
5 and lost customer goodwill is irreparable because it is neither easily calculable,
6 nor easily compensable and is therefore an appropriate basis for injunctive
7 relief accord Chemular, Inc. v. Ford, No. S-CV-0039036, 2017 WL 1510025,
8 at *2 (Cal. Super. Ct. Apr. 6, 2017) (granting plaintiff a preliminary injunction in
9 misappropriation of information suit
10 ).
11 Loss of goodwill is particularly detrimental in the intellectual property
12 context, where a licensor cultivates relationships with its licensees, customers, and
13 distributors. For example, in Fox Television Stations, Inc. v. BarryDriller Content
14 Systems, PLC, 915 F. Supp. 2d 1138, 1147 (C.D. Cal. 2012), plaintiffs, which
15 produced on-air television content, obtained a preliminary injunction against
16 unlicensed streaming content providers. In finding irreparable harm, the Court
17 emphasized that the availability of free and unlicensed content from other sources
18 Id.; see also, e.g., Warner
19 , 824 F. Supp. 2d 1003, 1012-14 (C.D. Cal.
20 2011) (granting a preliminary injunction in a copyright action in part because of
21 interference with the goodwill th customers);
22 Disney Enters., Inc. v. VidAngel, Inc., No. 216CV04109ABPLAX, 2016 WL
23 8292206, at *11 (C.D. Cal. Dec. 12, 2016) (granting a preliminary injunction in a
24 eat to the
25
26 relationships with them and the goodwill Plaintiffs have worked to create ); Hand
27 & Nail Harmony, Inc. v. ABC Nail & Spa Prods., No. SACV160969 DOCJEMX,
28
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1 2016 WL 3545524, at *7 (C.D. Cal. June 28, 2016) (finding irreparable harm for
2 purposes of a temporary restraining order
3 activities threaten and are already harming the business relationships with
4 ishing the value of their distributorships).
5 The essence
6 critical to the function of cellular networks, contributing technologies to standard-
7 development organizations, patenting its inventions, demonstrating the value and
8 effectiveness of that technology in commercial implementations, and licensing its
9 patents to cellular device manufacturers. Qualcomm has spent decades cultivating
10 the goodwill of its licensees; in order to develop that goodwill, Qualcomm strives
11 to treat similarly situated licensees fairly and to maintain consistency in its
12 licensing program. Without a preliminary injunction, Defendants, under the
13 direction of Apple, threaten to undo that work. (Rogers Decl. 8, 11.)
14 By paying no royalties at all patents,
15 Apple and Defendants have (unless enjoined by this Court) improperly secured for
16 themselves more favorable terms during the
17 e. (Id. 9-10.)
18 . (Id. 9.) Thus, by means of
19 their breaches, Apple and Defendants have seized for themselves a cost advantage
20 over their competitors, which will allow Apple to take for itself an even greater
21 share of industry profits. (Id. 9.) -payment of royalties
22 -payment as leverage to argue
23 (improperly) that they may also decline to pay under their respective agreements,
24 or may use the non-payment as leverage in renegotiations. (Id. 10.) At a
25 minimum, Qualcomm will suffer reputational damage, harm to the goodwill it has
26 developed over many years, and customer dissatisfaction. (Id. 8-10.) That is
27 irreparable harm. See BarryDriller, 915 F. Supp. 2d at 1147.
28
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1 2. Threatened Disruption Licensing Program and

a Multitude of Lawsuits.
2
Courts have found a sufficient showing of irreparable harm where a
3
harm severely For
4
example, in the franchise context, a court granted a preliminary injunction against
5
a former franchisee, noting that allowing the franchisee to continue operating in
6
violation of its non- send a signal to other disgruntled
7
8
NaturaLawn of Am., Inc. v. W. Grp., LLC, 484 F. Supp. 2d
9
392, 402 (D. Md. 2007) (describing prior oral ruling finding irreparable harm).
10
Courts have applied these principles to cases involving licensing businesses
11
as well. For example, in BarryDriller, the c
12
13
prospective licensees will demand concessions to make up the loss of viewership
14
to non-paying alternatives, and may push additional players away from license-fee
15
. 915 F. Supp. 2d at 1147. Similarly, in WTV, the court
16
17
paying the normal licensing fees, they deprive Plaintiffs of revenue, and even
18
824 F.
19
Supp. 2d at 1013.
20
So too here. Qua its ability to
21
license its tens of thousands of patents in return for royalties. Qualcomm has
22
hundreds of other licensees in addition to Defendants, many of which are
23
competitors of Apple and Defendants. By refusing to pay royalties for
24
25
significant competitive imbalance
26
improperly seek to capitalize. In fact, -payment of
27
royalties may undermine
28
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1 (Rogers Decl. 9, 11.) Cf. Commonwealth Sci. & Indus. Research Org. v.
2 Buffalo Tech. Inc., 492 F. Supp. 2d 600, 603 (E.D. Tex. 2007) (recognizing, in
3 granting a permanent injunction in a patent infringement suit, that [a]
4 own licensing payments would put [that licensee] at a competitive disadvantage
5 who would not be paying).
6 Given its level of sophistication, Apple undoubtedly knows this. The
7 industry will see Apple (i) dictate the conduct of the Defendants; (ii) completely
8 cut off Qualcomm from licensing revenue; and (iii) attempt to strong-arm a
9 favorable, discriminatory licensing agreement for itself. Apple is the most
10 profitable company in the cellular industry. Everyone is watching. Apple knows
11 that everyone is watching. A
12 concerned that Apple has dictated that no royalties be paid to Qualcomm for
13 Apple products. This threatens to cause substantial harm to Qualcomm not
14
15
16 l
17 attempt to gain bargaining leverage over Qualcomm and force Qualcomm to
18 surrender, Apple wants to cause as much disruption as possible.
19 While Qualcomm has valid and enforceable license agreements with other
20 licensees, that itself does not eliminate the risk that Qualcomm will face
21 irreparable harm, given the potential consequences of
22 unlawful conduct. See, e.g., Metro-Goldwyn-Mayer Studios, 518 F. Supp. 2d at
23 1219 he very need to file multiple lawsuits as a consequence of [d
24 copyright] inducement is itself supportive of an irreparable harm finding. ); Cal.
25
26 cf. Donahue, 232
27 Cal. App. 4th at 1184.
28
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1 3. Decreased Competitive Advantage and Intellectual Property

Development Due to Lost R&D Opportunities.
2
In patent infringement suits, courts have recognized that lost opportunities
3
for research and development constitute irreparable harm. See Buffalo Tech. Inc.,
4
492 F. Supp. 2d at 604-05 (granting permanent injunction and holding that
5
6
e to
7
lost opportunities for research and development); see also Pharmacia & Upjohn
8
Co. v. Ranbaxy Pharm., Inc.
9
finding of irreparable harm for purposes of preliminary injunction because, among
10
other things,
11
; Vanda Pharm. Inc. v. Roxane
12
Labs., Inc., 203 F. Supp. 3d 412, 436 (D. Del. 2016) (ordering a permanent
13
injunction in a patent infringeme would also suffer
14
15
16
formulations of [the aforementioned drugs] and dev ).
17
Courts have also recognized that the potential to lose a competitive
18
advantage from forgone research and development is irreparable harm. See
19
Cordelia Lighting, Inc. v. Zhejiang Yankon Grp. Co., No. EDCV14881JGBSPX,
20
2015 WL 12656241, at *7 (C.D. Cal. Apr. 27, 2015) (finding in patent
21
deleterious effects such as loss of market share to a
22
competitor . . . can support a finding of irreparable harm accord Chemular, Inc.,
23
2017 WL 1510025, at *2 (granting plaintiff a preliminary injunction in
24
misappropriation of information suit
25
plaintiff to lose its competitive advantage). As one court has articulated in a
26
patent infringement action, elays in research are likely to result in important
27
knowledge not being developed at all or [plaintiff] being pushed out of valuable
28
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1 fields as other research groups achieve critical intellectual property positions.

2 Thus, the harm of lost opportunities is irreparable. They cannot be regained with
3 future money because the opportunity that was lost already belongs to someone
4 Buffalo Tech. Inc., 492 F. Supp. 2d at 604.
5
6 (Rogers Decl. 7.) In 2016, Qualcomm spent $5 billion on research and
7 development, which made it a leader among high tech firms, both in absolute
8 terms and as a percentage of its revenue. (Ex. 31 at 14.) Based on Apple sales in
9 recent years, , on average, nearly
10 , every year, for however long Apple decides it does not
11 want to pay Qualcomm royalties. (Samimi Decl. 14.)
12 threatens to wipe out funds that equal a substantial portion of
13 massive R&D spending. That is the very definition of irreparable harm. See
14 Cordelia, 2015 WL 12656241, at *7; see also Pharmacia at 215;
15 Buffalo Tech. Inc., 492 F. Supp. 2d at 604-05.
16 C. Difficulties in Collecting Future Damages Awards from Foreign
Defendants.
17
18
[a] Defendant currently is a foreign entity and this alone is sufficient to show that
19
[a Plaintiff] will likely be irreparably harmed. Aevoe Corp. v. Shenzhen
20
Membrane Precise Electron Ltd., No. 2:12-CV-00054-GMN, 2012 WL 1532308,
21
at *5-6 (D. Nev. May 1, 2012) (emphasis added) (finding, for purposes of
22
23
foreign status alone); see also Pharmacia & Upjohn Co.
24
25
26
harm); Cordelia Lighting, Inc., tential
27
28
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1 difficulty inherent in collecting damages from a foreign defendant with limited

2
3 Defendants are all non-U.S. companies with their primary assets located
4 overseas. (See Ex. 26 at 97; Ex. 27 at 200; Ex. 28 at 220; Ex. 29 at F-82; Ex. 30 at
5 17.) The potential difficulty Qualcomm may have in enforcing any future
6 damages award against these foreign Defendants constitutes, in and of itself, a
7 likelihood of irreparable harm.
8 IV. The Balance of Hardships Weighs
9 Defendants seek to overturn more than 15 years of practice between the
10 parties without legal justification, and in the process to inflict irreparable harm on
11 Qualcomm. None of the harms described above can be remedied by after-the-fact
12 monetary damages. By contrast, Defendants would be required only to do what
13 they have been doing for years paying under their patent license agreements.
14 For its part, Apple has become the most valuable company in history while
15 Apple should continue
16 paying Defendants what it owes them for the devices they manufacture for Apple
17 (relief Qualcomm has requested in a related action). But if Apple refuses to do so,
18 Defendants should stop manufacturing devices for Apple. Or Defendants should
19 pay the royalties owed to Qualcomm out of their own pockets to be repaid by
20 Apple based on its indemnification promise to Defendants. Either way,
21 Qualcomm simply asks the Court to order that the Defendants comply with their
22 contracts with Qualcomm. See Tanner Motor Livery, Ltd. v. Avis, Inc., 316 F.2d
23 804, 808 (9th Cir. 1963) It is so well settled as not to require citation of authority
24 that the usual function of a preliminary injunction is to preserve the status quo ante
25 litem pending a determination of the action on the merits.
26 Defendants would prefer to derive the full benefit of the license agreements
27 without paying anything on Apple devices, but that would be fundamentally
28
AND AUTHORITIES
1 unfair. On the other hand, there is nothing unfair about holding Defendants to
2 their promises, especially given their indemnification arrangement with Apple.
3 See, e.g., , 107 F.2d 27,
4 32-33 (3d Cir. 1939) has been partly performed and equity
5 requires that it be completed by supplying the amount which United must pay for
6 the license in accordance wit ). The balance of the
7 favor. See Wild Rockies, 632 F.3d at 1131.
8 V. The Public Interest Supports a Preliminary Injunction.
9 There is a strong public interest in protecting intellectual property rights.
10 See, e.g., PPG Indus., Inc. v. Guardian Indus. Corp., 75 F.3d 1558, 1567 (Fed.
11 Cir. 1996) (recognizing the
12 patent rig injunction, the Northern District of
13
14 and [has] recognize[d] the role of protecting intellectual property rights as part of
15
16 Networks, Inc., No. C 10-3428, 2013 WL 557102, at *7 (N.D. Cal. Feb. 12, 2013).
17 ents with Qualcomm allow them to manufacture
18 devices that practice thousands (Rogers Decl. 5-6.)
19 Protecting those property rights is in the public interest.
20 CONCLUSION
21 For the foregoing reasons, Qualcomm respectfully requests that the Court
22 enjoin Defendants from violating the terms and conditions of their license
23 agreements during the pendency of this litigation.
24 Dated: May 24, 2017 Respectfully submitted,
26 Evan R. Chesler
27
28
AND AUTHORITIES
1
(N.Y. Bar No. 1475722)
Keith R. Hummel (pro hac vice)
4 (N.Y. Bar No. 2430668)
khummel@cravath.com
5 Richard J. Stark (pro hac vice)
(N.Y. Bar No. 2472603)
6 rstark@cravath.com
Antony L. Ryan (pro hac vice)
7 (N.Y. Bar No. 2784817)
aryan@cravath.com
8 Gary A. Bornstein (pro hac vice)
(N.Y. Bar No. 2916815)
9 gbornstein@cravath.com
J. Wesley Earnhardt (pro hac vice)
10 (N.Y. Bar No. 4331609)
wearnhardt@cravath.com
11 Yonatan Even (pro hac vice)
(N.Y. Bar No. 4339651)
12 yeven@cravath.com
Vanessa A. Lavely (pro hac vice)
13 (N.Y. Bar No. 4867412)
vlavely@cravath.com
14 Worldwide Plaza, 825 Eighth Avenue
New York, NY 10019
15 Telephone: (212) 474-1000
Facsimile: (212) 474-3700
16
17 QUINN EMANUEL URQUHART &
SULLIVAN, LLP
18 David A. Nelson (pro hac vice)
(Ill. Bar No. 6209623)
19 davenelson@quinnemanuel.com
Stephen Swedlow (pro hac vice)
20 (Ill. Bar No. 6234550)
stephenswedlow@quinnemanuel.com
21 500 West Madison St., Suite 2450
Chicago, Illinois 60661
22 Telephone: (312) 705-7400
Facsimile: (312) 705-7401
23
24 Alexander Rudis (pro hac vice)
(N.Y. Bar No. 4232591)
25 alexanderrudis@quinnemanuel.com
51 Madison Ave., 22nd Floor
26 New York, New York 10010
Telephone: (212) 849-7000
27 Facsimile: (212) 849-7100
28
AND AUTHORITIES
1 Sean S. Pak (SBN 219032)

seanpak@quinnemanuel.com
2 50 California St., 22nd Floor
San Francisco, CA 94111
3 Telephone: (415) 875-6600
Facsimile: (415) 875-6700
4
5 JONES DAY
Karen P. Hewitt (SBN 145309)
6 kphewitt@jonesday.com
Randall E. Kay (SBN 149369)
7 rekay@jonesday.com
Telephone: (858) 314-1200
9 Facsimile: (858) 345-3178
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
AND AUTHORITIES

(N.Y. Bar No. 1475722)
3 825 Eighth Avenue
New York, NY 10019
4 Telephone: (212) 474-1000
Facsimile: (212) 474-3700
5
6 (Ill. Bar No. 6209623)
Telephone: (312) 705-7400
9 Facsimile: (312) 705-7401
11 JONES DAY
Telephone: (858) 314-1200
13 Facsimile: (858) 345-3178
15
19 Plaintiff, DECLARATION OF VANESSA
A. LAVELY IN SUPPORT
20 v. OF PLAINTIFF QUALCOMM
INCORPORATEDS MOTION
21 COMPAL ELECTRONICS, INC., FIH FOR A PRELIMINARY
MOBILE LTD., HON HAI INJUNCTION
22 PRECISION INDUSTRY CO., LTD,
PEGATRON CORPORATION, and Date: June 26, 2017
23 WISTRON CORPORATION,
Courtroom: 14B
24 Defendants.
25
26 by the Court.
28
Case No.: 3:17-cv-1010-WQH-JMA
Declaration of Vanessa A. Lavely
1 I, Vanessa A. Lavely, declare as follows:

2 1. I am an attorney at the law firm of Cravath, Swaine & Moore LLP, and
3 I am one of the attorneys representing Plaintiff Qualcomm Incorporated in this
4 action. I am a member of the bar of the State of New York and am admitted to
5 appear pro hac vice before this Court in the above-captioned action.
6 2. I submit this declaration in support of Plaintiff Qualcomm
7 Incorporateds Motion for a Preliminary Injunction.
8 3. Attached hereto as Exhibit 1 is a true and correct copy of the
9 Subscriber Unit License Agreement between Compal Electronics, Inc. and
10 Qualcomm Incorporated, dated February 10, 2000, and amendments thereto.
12 Subscriber Unit License Agreement between Foxconn International Holdings Ltd.
13 (now known as FIH Mobile Ltd.) and Qualcomm Incorporated, dated October 18,
14 2005, and amendments thereto.
15 5. Attached hereto as Exhibit 3 is a true and correct copy of the Request
16 for Consent to Sublicense between Foxconn International Holdings Ltd. (now
17 known as FIH Mobile Ltd.), Hon Hai Precision Industry Co., Ltd. and Qualcomm
18 Incorporated, dated October 18, 2005.
20 Subscriber Unit License Agreement between Wistron Corporation and Qualcomm
21 Incorporated, dated May 23, 2007.
23 Subscriber Unit License Agreement between Pegatron Corporation and Qualcomm
24 Incorporated, dated April 29, 2010, and amendments thereto.
26 Statement of Work for Qualcomm Chipsets between Apple Inc. and Qualcomm
27 Incorporated, dated December 7, 2015, and attachments thereto, including the STA
28 Assignment Agreement as Attachment C.
-2- Declaration of Vanessa A. Lavely
1 9. Attached hereto as Exhibit 7 is a true and correct copy of a letter from

2 BJ Watrous to Alex Rogers, dated February 3, 2017.
3 10. Attached hereto as Exhibit 8 is a true and correct excerpted copy of
4 the Q4 2016 iPhone Royalty Report for Hon Hai Precision Industry Co., Ltd., dated
5 January 21, 2017.
7 the Q4 2016 iPad CD Royalty Report for Foxconn International Holdings Limited
8 (now known as FIH Mobile Ltd.), dated December 31, 2016.
10 the Q4 2016 iPad LH Royalty Report for Foxconn International Holdings Limited
11 (now known as FIH Mobile Ltd.), dated December 31, 2016.
12 13. Attached hereto as Exhibit 11 is a true and correct copy of an email
13 from Anny Tong to Vivian Wen, dated February 7, 2017.
14 14. Attached hereto as Exhibit 12 is a true and correct copy of the Q4
15 2016 iPhone Royalty Report for Pegatron Corporation.
16 15. Attached hereto as Exhibit 13 is a true and correct copy of the Q4
17 2016 iPhone Royalty Report for Wistron Corporation, dated February 10, 2017.
19 from Allie Wu to Grace Tai, dated February 15, 2017.
21 the Q4 2016 iPad Royalty Report for Compal Electronics Inc.
22 18. Attached hereto as Exhibit 16 is a true and correct copy of a letter
23 from Bruce Sewell to Don Rosenberg, dated April 25, 2017.
25 the Q1 2017 iPad Royalty Report for Compal Electronics Inc.
27 from Shawn Tien to Yunhui Chae-Banks, dated April 27, 2017.
1 from Jack Chang to Grace Tai, dated May 3, 2017.

3 the Q1 2017 iPhone Royalty Report for Hon Hai Precision Industry Co., Ltd., dated
4 April 13, 2017.
6 the Q1 2017 iPad CD Royalty Report for Foxconn International Holdings Limited
7 (now known as FIH Mobile Ltd.), dated March 31, 2017.
9 the Q1 2017 iPad LH Royalty Report for Foxconn International Holdings Limited
10 (now known as FIH Mobile Ltd.), dated March 31, 2017.
12 from Anny Tong to Vivian Wen, dated April 27, 2017.
14 Q1 2017 iPhone Royalty Report for Pegatron Corporation.
15 27. Attached hereto as Exhibit 25 is a true and correct copy of the Axios
16 article titled Apple Confirms It Wont Make Royalty Payments to Qualcomm
17 Until Dispute Settled, by Paul Sakuma, dated April 28, 2017, available at
18 https://www.axios.com/apple-confirms-it-wont-make-royalty-payments-to-
19 qualcomm-until-dispute-2383383892.html.
21 the 2016 Annual Report of FIH Mobile Ltd., released April 12, 2017, available at
22 http://www.fihmb.com/investors/Investors.aspx.
24 the 2015 Annual Report (Hon Hai English Translation) of Hon Hai Precision
25 Industry Co., Ltd., dated April 30, 2016, available at http://www.foxconn.com/
26 Files/annual_rpt_e/2015_annual_rpt_e.pdf.
28 the 2015 Annual Report (Pegatron English Translation) of Pegatron Corporation,
1 dated March 22, 2016, available at http://investor.pegatroncorp.com/annual/

2 2015/EN/2015_Annual_Report_eng_bCnmQmjCemLJ.pdf.
4 the 2016 Annual Report (Wistron English Translation) of Wistron Corporation,
5 dated April 30, 2017, available at http://www.wistron.com/images/acrobat/
6 annual_reports/2016/annual_report_entire_report.pdf.
7 32. Attached hereto as Exhibit 30 is a true and correct excerpted copy of a
8 report titled "Leading Multinationals from Taiwan Increase Their Foreign Assets
9 Despite the Global Crisis", by the College of Management, Fu Jen Catholic
10 University, and Vale Columbia Center on Sustainable International Investment,
11 dated November 3, 2011, available at http://ccsi.columbia.edu/files/
12 2013/11/Taiwan_2011 .pdf.
14 Qualcomm Incorporated's Form 10-K for the fiscal year ending September 25,
15 2016.
16
17
18
19 Pursuant to 28 U.S.C. 1746,1 declare under penalty of perjury that the
20 foregoing is true and correct and that I executed this declaration on May 24, 2017 in
21 New York, New York.
22
23
24
25
26
27
28
Declaration of Vanessa A. Lavely
1 Table of Exhibits
2 Exhibit No. Pages
3 1 1-75
2 76-167
4
3 168-169
5 4 170-205
6 5 206-271
6 272-299
7
7 300-301
8 8 302-304
9 9 305-309
10 10 310-314
11 315-317
11 318-358
12
12 13 359
13 14 360-362
15 363-366
14
16 367-368
15 17 369-372
16 18 373
19 374
17
20 375-378
18 379-382
21
19 22 383-386
20 23 387-388
24 389-475
21
25 476
22 26 477-488
23 27 489-499
28 500-513
24
29 514-525
25 30 526-532
26 31 533-548
27
28
Exhibit 1
ENTIRE EXHIBIT
SUBMITTED UNDER SEAL
Exhibit 2
ENTIRE EXHIBIT
Exhibit 3
ENTIRE EXHIBIT
Exhibit 4
ENTIRE EXHIBIT
Exhibit 5
ENTIRE EXHIBIT
Exhibit 6
ENTIRE EXHIBIT
Exhibit 7
EXHIBIT SUBMITTED
PARTIALLY UNDER SEAL
,
Febrnary 3, 2017
By Overnight Delivery & email to arogers@gualcomm.com
Alex Rogers
EVP & President, QTL
QUALCOMM Incorporated
5775 Morehouse Drive
San Diego, CA 92121-1714
Confidential - Subject to Party Mutual Confidentiality Agreement
Dear Alex,
I am writing to follow-up on earlier conespondence regarding the BCPA.
As Apple stated it would do in its Complaint on Januaiy 20, 2017, Apple has
withheld a total of approximately $963 million from Apple's January payments to certain
of its contract manufacturers. The amount covers BCPA payments Qualcomm withheld
from Apple for CQ2 and CQ3, as well as the BCPA payment Qualcomm indicated it
would not pay for CQ4.
In the interest of transparency, we wanted to share with Qualcomm just how these
deductions applied to the royalty payments recently made by Apple to our contract
manufacturers for the fourth quarter of 2016.
Contract TOTAL
Manufacturer PAID
Hon Hai
Pegatron
Wistron
Compal
Apple
1 Infinite loop, MS 169-31 Pl
Cupertino, CA 95014
T 408996-10 10
F 408 996-0275
EXHIBIT 7
PAGE 300

By making these payments to its CMs, Apple has paid the full
and through all of 2016, consistent with the BCPA, even
though we continue to believe these amounts are excessive and inconsistent with
FRAND.
As I shared with you in November, Apple was (and is) interested in a reasonable
and good faith offer from Qualcomm to resolve the parties BCPA dispute. What we
received in Qualcomms December 2 letter was not acceptable. As I noted in my reply of
December 22, Qualcomms demands sought to effectively hold the BCPA funds hostage
pending remedial measures that have no basis in the BCPA and that would undermine
Apples responsibility to respond truthfully to law enforcement agencies. Once Apple
raised these legitimate concerns, Qualcomm chose not to reply whether to clarify its
conditions, withdraw them, or otherwise. Accordingly, it should have come as no
surprise when Apple repeated these same concerns in its Complaint.
I value our personal and professional relationship of many years. In candor, that
is what has made Qualcomms actions all the more disappointing. Qualcomm chose to
take actions that violate both our contract and the law. I wish that had not been the
case. Even so, I continue to remain optimistic that we will be able to work together to
help our companies resolve this dispute swiftly and professionally.
Sincerely,
BJ Watrous
Vice President & Chief IP Counsel
2
EXHIBIT 7
PAGE 301
Exhibit 8
ENTIRE EXHIBIT
Exhibit 9
ENTIRE EXHIBIT
Exhibit 10
ENTIRE EXHIBIT
Exhibit 11
EXHIBIT SUBMITTED
Message
From: anny.ch.tong@foxconn.com [anny.ch.tong@foxconn.com)
Sent: 2/7/2017 3:49:16 AM
To: Wen, Vivian [/o=Qualcomm/ou=Exchange Administrative Group (FYDIBOHF23SPDLT)/cn=Recipients/cn=swen);
Mesa, Celina [/o=Qualcomm/ou=San Diego Admin Group/cn=Recipients/cn=cmesa)
CC: hellen.y.wang@foxconn.com; Graves, Eva [/o=Qualcomm/ou=San Diego Admin Group/cn=Recipients/cn=egraves]
Subject: Q~:HON HAI PRECISION INDUSTRY CO LTD 2017-01-31
Hi Vivian
Have confinned with internal team. from customer until now. so please revise invoice as below:
remainder amount not be issued . Iffurtber illformation I get will let you know at once.
Best Regards
Anny
swen@qualcomm.com ToiG anny.ch.tong@mail.foxconn.com,cmesa@qualcomm.com

CciG hellen.y.wang@mail.foxconn.com,egraves@qualcomm.com
2017/2/4 i:tWi:tE
RE: Aae:HON HAI PRECISION INDUSTRY co LTD 2017-01-31
06:40:53
Hi Anny,
Thank you, but t o clarify our question: Please explain how each of the three amounts was calculated?
Thank you!
Vivian Wen (i:ta 2 a,A)

Qualcomm Technology licensing
5775 Morehouse Dr.
San Diego, CA92121
Tel: 858-651-0776
Fax:858-651-1975
swen@qualcomm.com
From: anny.ch.tong@foxconn.com [mailto:anny.ch.tong@foxconn.com ]

Sent: Thursday, February 02, 2017 9:43 PM
To: Wen, Vivian <swen@qualcomm.com>; Mesa, Celina <cmesa@qualcomm.com>
Cc: hellen.y.wang@foxconn.com
Subject: Re: Aae:HON HAI PRECISION INDUSTRY co LTD 2017-01-31
EXHIBIT 11
PAGE 315
Hi Vivian
For China custom due to deferent import way.
Best Regards
Anny
swen@gualcomm.com ToiG anny.ch.tong@mail.foxconn.com ,cmesa@gualcomm.com

CciG hellen.y.wang@mail.foxconn.com
2017/2/3
D : iG Re: Aae:HON HAI PRECISION INDUSTRY co LTD 2017-01-31
1:1W1:1E 11:42:31
Hi Anny,
Can you please explain why Foxconn requests three separate invoices for the 2016 0 4 iPhone Royalty report?
Thanks, Vivian
----- Reply message -----

From: " anny.ch .tong@foxconn.com" <anny.ch.tong@foxconn.com>
To: "Wen, Vivian" <swen@qualcomm.com>, "Mesa, Celina" <cmesa@qualcomm.com>
Cc: " hellen.y.wang@foxconn.com" <hellen.y.wang@foxconn.com>
Subject: Aae:HON HAI PRECISION IN DUSTRY co LTD 2017-01-31
Date: Tue, Jan 31, 2017 4:41 PM
Dear Vivian and Celina
Have received invoice as attached for iPhone Royalty report in 201604 , Could you please help to revise as below.
Best Regards
Anny
mail from ip-->10.195.151.150

mail from pc->f2829267a
Version: Super Notes 1.6.9.88
mail from ip-->10.195.151.150

mail from pc->f2829267a
EXHIBIT 11
PAGE 316
EXHIBIT 11
PAGE 317
Exhibit 12
ENTIRE EXHIBIT
Exhibit 13
ENTIRE EXHIBIT
Exhibit 14
Message
From: ALLIE_WU@WISTRON.COM [ALLIE_WU@WISTRON .COM]
Sent: 2/15/2017 2:09:35 AM
To: Tai, Grace [/o=Qualcomm/ou=Exchange Administrative Group (FYDIBOHF23SPDLT)/cn=Recipients/cn=gtaia22)
CC: ALBERT_CHANG@WISTRON.COM; Chae-Banks, Yunhui [/o=Qualcomm/ou=San Diego Admin
Group/cn=Recipients/cn=t_yunhui]; Wen, Vivian [/o=Qualcomm/ou=Exchange Administrative Group
(FYDIBOHF23SPDLT)/cn=Recipients/cn=swen); Pilgram, Ryan [/o=Qualcomm/ou=E xchange Administrative Group
(FYDIBOHF23SPDLT)/ cn=Recipients/cn=c_rpilgr)
Subject : RE: Wistron CY16Q4 Report
Hi Grace,
The current information of report are what customer allowed us to provide.
What I can do now is to help to push our FIN team to speed up the payment as urgent case once receiving invoice for
your team.
Thank you,
Allie
From: Tai, Grace [mailto:gtai@qualcomm.com ]

Sent: Tuesday, February 14, 2017 3:53 PM
To: Allie Wu/WHO}Wistron <ALLI E_WU@WISTRON.COM>
Cc: Albert Chang/WHO}Wistron <ALBERT_CHANG@WISTRON.COM>; Chae-Banks, Yunhui <yunhu ic@qualcomm.com>;
Wen, Vivian <swen@qualcomm.com>; Pilgram, Ryan <rpilgram@qualcomm.com>
Subject: Re: Wistron CY16Q4 Report
Hi Allie,
The 201604 roya lty report you provided is missing information about Wistron's sales. Can you please resend the royalty
report with complete and accurate information for 2016Q4?
Thanks,
EXHIBIT 14
PAGE 360
Grace
From: ALLIE WU@WISTRON.COM <ALLIE WU@WISTRON .COM >

Sent: Monday, February 13, 2017 2:03 AM
To: Tai, Grace
Cc: ALBERT CHANG@WISTRON.COM ; Chae-Banks, Yunhui; Wen, Vivian; Pilgram, Ryan
Subject: RE: Wistron CY16Q4 Report
Hi Grace,
Please find the attachment for 201604 royalty report of Apple products.
Thanks,
Allie
From: Tai, Grace [mailto:gtai@qualcomm.com ]

Sent: Saturday, February 11, 2017 7:20 AM
To: Allie Wu/WHQ}Wistron <ALLIE WU@WISTRON.COM >
Cc: Albert Chang/WHQ}Wistron <ALBERT CHANG@WISTRON.COM >; Chae-Banks, Yunhui <yunhuic@qualcomm.com >;
Wen, Vivian <swen@qualcomm.com >; Pilgram, Ryan <rpilgram@qualcomm.com >
Subject: RE: Wistron CY16Q4 Report
Hi Allie,
Could you please advise if there is any updates regarding Wistron CY16Q4 Apple royalty report?
Thanks,
Grace Tai (~$)
EXHIBIT 14
PAGE 361
Tel: 858-845-6244
gtai @gualcomm.com
EXHIBIT 14
PAGE 362
Exhibit 15
ENTIRE EXHIBIT
Exhibit 16
EXHIBIT SUBMITTED
April 25, 2017
Donald Rosenberg
EVP, General Counsel & Corporate Secretary
QUALCOMM Incorporated
Dear Don:
As you may have already heard from our contract manufacturers, Apple has not remitted
funds to those contract manufacturers for royalty payments for the quarter ending March 31,
2017. This should come as no surprise to Qualcomm. Derek and I have discussed this
eventuality at various times in the past few years. Qualcomms refusal to license on a fair,
reasonable, non-discriminatory basis is harming not only Apple, but our contract
manufacturers, other chipset companies and the wider industry. We believe Qualcomm is
charging the contract manufacturers, who in turn pass back to Apple and its customers,
royalties based on an illegal manipulation of the market for cellular enabled
chipsets. Withholding these royalty payments from the contract manufacturers is consistent
with the very public legal claims we have made against Qualcomm, and is also very
appropriate given the nature of our current dispute.
Our legal filings make clear that Qualcomm has been charging royalties for technologies they
have nothing to do with for years. The more Apple innovates with unique features the more
money Qualcomm collects for no reason, and the more expensive it becomes for Apple to
fund these innovations. Despite being just one of over a dozen companies that contributed to
basic cellular standards, Qualcomm forces the contract manufacturers and Apple to pay
many times more in royalty payments than all the other cellular patent licensors
combined! This is grossly unfair and needs to be reviewed by the courts and appropriate
antitrust agencies - activities which are now underway.
Until these matters are resolved Apple feels it has no choice but to take this step. As I have
said many times, Apple values its commercial relationship with Qualcomm but we also want
to continue innovating and providing our customers with the very best products we can at
prices that are fair. Qualcomm's refusal to meet its FRAND commitments and its insistence
on taxing our innovation is both illegal and anticompetitive. We cannot support this behavior.
Apple Inc.
1 Infinite Loop
Cupertino, CA 95014
T 408 996-1010
F 408 996-0275
www.apple.com
EXHIBIT 16
PAGE 367
Apple is not entitled to a free ride - we have never claimed that. We stand ready to pay a fair
and reasonable amount for the use of Qualcomms patented technologies. I specifically refer
you to the
that was attached to the last offer we made to Qualcomm in January. We
believe this action shows our commitment to pay FRAND royalties once the amount is finally
determined by the courts on a fair, reasonable and non-discriminatory basis.
Best regards,
Bruce Sewell
Senior Vice President and General Counsel
Apple Inc.
Apple Inc.
1 Infinite Loop
Cupertino, CA 95014
T 408 996-1010
F 408 996-0275
www.apple.com
EXHIBIT 16
PAGE 368
Exhibit 17
ENTIRE EXHIBIT
Exhibit 18
From: Tien. Shawn (GSM) [mailto:Shawn_Tien@compal.com]

Sent: Thursday, April 27, 2017 5:01 AM
To: Yunhui Chae-Banks <yunhuic@qualcomm.com>
Subject: QTL royalties
Hi Yunhui,
Long time and how are you.? Hope this mail find you well.
I am writing you the early headup in considering of QTL royalty reporting and payment issue
recently.
We were informed by our shared key client, who are also under major legal action with
qualcomm mutually.
Our customer has recently formally requested compal to stop the royalty payment to
qualcomm that associated to their business until legal action is completed. We may have to
take some action about this to revise the Q1 report.
This is for your early notice, let me know if you need quick conversation about this.
Thanks,
Shawn
Shawn Tien
Sr. Director of Marketing and Product Mgmt.
Product Innovation
Smart Device Business Group
Compal
Office: +886-2-8751-6228 ext 13575

Address: 385 Yangguang Str. Neihu, Taipei
=====================================================================
=====================================================================
======================
This message may contain information which is private, privileged or confidential of Compal
Electronics, Inc. If you are not the intended recipient of this message, please notify the sender
and destroy/delete the message. Any review, retransmission, dissemination or other use of, or
taking of any action in reliance upon this information, by persons or entities other than the
intended recipient is prohibited.
=====================================================================
=====================================================================
======================
EXHIBIT 18
PAGE 373
Exhibit 19
Message
From: Chang. JackRF (GSM) [JackRF _Chang@compal.com]

Sent: 5/3/2017 2:04:52 AM
To: Grace Tai [/o=Qualcomm/ou=Exchange Administrative Group (FYDIBOHF23SPDLT)/cn=Reci pients/cn=gtaia22]
CC: Vivian Wen [/o=Qualcomm/ou=Exchange Administrative Group (FYDIBOH F23SPDLT)/cn=Recipients/cn=swen]; Chiu.
Antony (GSM) [Antony_Chiu@compal.com]; Chang. Jill (GSM) Uill_chang@compal.com]
Subject: RE: Compal Q1'17 royalty report
Attachments: 2017Ql-Qualcomm Royalty Report 20170414-Revised.xls
Dear Grace
We received the notification from Apple about royalty payment .
Apple will not be transmitting funds to CEI for the quarterly royalty payment to Qualcomm since 201701.
So we will only submit non-Apple ' s report/payment.
Please refer to the attachment for 17' Ql non-Apple' s report ,and revised invoice for 17' Ql payment to us.
Thank you !
~-Jack Chang
f=~~H~I~!Rf5Hnl~0~ (irH/\$)
Compal Electronics, Inc.
TEL : (02)8751-6228 Ext.18094
FAX: (02)8751-8518
Address: i:l'jtm 11491 ~~~~@1Clli3855Jj~6fl (SDBG*tl)

E-Mail: JackRF Chang@compal.com
EXHIBIT 19
PAGE 374
Exhibit 20
ENTIRE EXHIBIT
Exhibit 21
ENTIRE EXHIBIT
Exhibit 22
ENTIRE EXHIBIT
Exhibit 23
EXHIBIT SUBMITTED
Message
From: anny.ch.tong@foxconn.com [anny.ch.tong@foxconn.com)

Sent: 4/27/2017 12:11:16 AM
To: Vivian W en [/o=Qualcomm/ou=Exchange Administrative Group (FYDIBOHF23SPDLT)/cn=Recipi ents/cn=swen]
CC: hellen.y.wang@foxconn.com
Subject: RE: Q1'17 Fox iPhone royalty
Hi Vivian
Still watiting for funds from customer , I bave no idea when can release patment to you .
Best Regards
Alllly
swen@qualcomm.com ToiG anny.ch.tong@mail.foxconn.com

CciG hellen.y.wang@mail.foxconn.com
2017/4/26 i:tWi:tE
RE: Q1'17 Fox iPhone royalty
08:32:25
Hi Anny,
When can we expect to receive Qli: 17 royalty payment? Thanks.
Thank you.
Vivian Wen (oa ' OA0)

Qualcomm Technology Licensing
5775 Morehouse Dr.
San Diego, CA92121
Tel : 858-651-0776
Fax:858-651-1975
swen@gualcomm.com
From: anny.ch.tong@foxconn.com [mailto:anny.ch.tong@foxconn.com ]

Sent: Monday, April 17, 2017 5:42 PM
To: Vivian Wen <swen@qualcomm.com>
Cc: hellen.y.wang@foxconn.com
Subject: Q1'17 iPhone royal ty
Hi Vivian
Please refer HH iPhone Ql 2017 royalty report, Total amount i s ' please issue 2 pcs
invoice, since one of it need to be submitted to china custom.
EXHIBIT 23
PAGE 387
Best Regards
Anny
mail from ip--> I0. 195.151.150

mail from pc-->f2829267a
Version: Super Notes l.6.9.8B
mail from ip-->10.195. 15 1.150

mail from pc-->f2829267a
Version: Super Notes l.6.9.8B
EXHIBIT 23
PAGE 388
Exhibit 24
ENTIRE EXHIBIT
Exhibit 25
(/)
Sign In
Ina Fried (/Community/Ina) Apr 28
Apple confirms it won't make royalty payments to Qualcomm

until dispute settled
Paul Sakuma / AP
Apple confirmed Friday that it won't make any further royalty payments to Qualcomm until a court weighs in on
the dispute between the two companies. Earlier on Friday Qualcomm lowered its quarterly earnings forecast
(https://www.axios.com/qualcomm-cuts-earnings-forecast-after-apple-withholds-more-royalty-pay-
2383327440.html), noting that Apple, via its suppliers, had stopped making payments.
"We've been trying to reach a licensing agreement with Qualcomm for more than five years but they have refused
to negotiate fair terms," Apple told Axios in a statement. "Without an agreed-upon rate to determine how much is
owed, we have suspended payments until the correct amount can be determined by the court. As we've said
before, Qualcomm's demands are unreasonable and they have been charging higher rates based on our innovation,
not their own."
The context: Apple is suing Qualcomm for $1 billion and Qualcomm has filed a countersuit of its own. The legal
battle is fraught for both sides, though, with Apple being one of Qualcomm's biggest customers and Apple needing
Qualcomm's modems for the Verizon and Sprint versions of the iPhone.
https://www.axios.com/apple-confirms-it-wont-make-royalty-payments-to-qualcomm-until-dispute-2383383892.htm...
EXHIBIT 25
PAGE 476
Exhibit 26
EXHIBIT 26
PAGE 477
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'LEMVQERvW7XEXIQIRX
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EXHIBIT 26
PAGE 478
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0%97MY/M &EROSJ'LMRE
(ERMIP.SWITL1),%2 'LMRE+YERKJE&ERO
',)2*YRK1MRK 'LMRE1IVGLERXW&ERO
8%3=YR'LML 'LMREXVYWX'SQQIVGMEP&ERO
'MXMFERO
'314%2=7)'6)8%6= -RHYWXVMEP&ERO
0%;7EM,E] &EROSJ'SQQYRMGEXMSRW
1M^YLS'SVTSVEXI&ERO
6)+-78)6)(3**-') 7XERHEVH'LEVXIVIH&ERO
43&S\+VERH4EZMPMSR 8EMTIM*YFSR&ERO
,MFMWGYW;E] 8LI,SRKOSRKERH7LERKLEM&EROMRK
;IWX&E]6SEH 'SVTSVEXMSR0MQMXIH
+VERH'E]QER
/='E]QER-WPERHW 46-2'-4%07,%6)6)+-786%6%2(
86%27*)63**-')
,)%(3**-') 6S]EP&EROSJ'EREHE8VYWX'SQTER]'E]QER 0MQMXIH
2S=SY]M6SEH XL*PSSV6S]EP&ERO,SYWI
0ERKJERK)GSRSQMGERH8IGLRSPSKMGEP 7LIHHIR6SEH+ISVKI8S[R
(IZIPSTQIRX>SRI +VERH'E]QER/=
,IFIM4VSZMRGI 'E]QER-WPERHW
4ISTPIvW6ITYFPMGSJ'LMRE
,32+/32+&6%2',7,%6)
46-2'-4%040%')3*&97-2)77 6)+-786%6%2(86%27*)63**-')
-2,32+/32+ 'SQTYXIVWLEVI,SRK/SRK-RZIWXSV
XL*PSSV4IRMRWYPE8S[IV 7IVZMGIW0MQMXIH
'EWXPI4IEO6SEH XL*PSSV,STI[IPP'IRXVI
'LIYRK7LE;ER 5YIIRvW6SEH)EWX
/S[PSSR ;ER'LEM
,SRK/SRK ,SRK/SRK
%9(-8367 783'/'3()
(IPSMXXI8SYGLI8SLQEXWY
2SXI 1V,9%2+'LMR,WMIRERH(V093>LSRKWLIRKLEZIFIIRETTSMRXIHEWI\IGYXMZIHMVIGXSVWSJXLI'SQTER][MXLIJJIGXJVSQ1EVGL
*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 479
',%-61%2v778%8)1)28
(IEV7LEVILSPHIVW
8LI JMVWX LEPJ SJ [EW ZIV] GLEPPIRKMRKJSVXLI+VSYT 'SYTPIH [MXL XLIJMRERGMEPXYVQSMPSJ 'LMREERHKPSFEP
IGSRSQMG YRGIVXEMRXMIW MR IEVP] XLI GYWXSQIV XVERWMXMSR ERH HMWIRKEKIQIRX VIWYPXIH JVSQ XLI GLERKI MR
GYWXSQIVWv SYXWSYVGMRK WXVEXIKMIW ERH QEVOIX WLEVI VIWLYJJPI MR XLI LMKLP] GSQTIXMXMZI LERHWIX QEVOIX PIH XS
HVEQEXMGHIGPMRIMRWEPIWXSWSQIQENSVGYWXSQIVWERHGVIEXIHRIKEXMZIMQTEGXXSSYVFYWMRIWW
;I[IVI FPIWWIHF] XLIVMKLX HIGMWMSR QEHI MRTVIZMSYW]IEVWXS HIZSXIVIWSYVGIW XS XLI KVS[MRKWIKQIRXW ERH
JSGYW SR 'LMRIWI GYWXSQIVW [LS LEZI I\LMFMXIH WMKRMJMGERX QEVOIX KVS[XL MR VIGIRX ]IEVW 8LIVI LEW FIIR E
RSXMGIEFPI WPS[HS[RMR WQEVXTLSRIWLMTQIRXW [MXL 'LMREWLS[MRK E QSVIQEXYVIKVS[XLTEXXIVR 3YVIJJSVXWMR
[SVOMRK[MXLSYV'LMRIWIGYWXSQIVW[IVIIWWIRXMEPXSXLIMVWGEPIYTI\TERWMSRWERHSYVWYTTP]GLEMRQEREKIQIRX
GSQTIXMXMZIRIWW IREFPIH XLIMV WO]VSGOIXIH ZSPYQIL]TI 'LMRIWI FVERHW LEZIIQIVKIH ERH RS[ XLVII 'LMRIWI
FVERHWVEROIH[MXLMRXLIXSTJMZI[SVPH[MHIWQEVXTLSRIZIRHSVW
7MRGI KMZIR XLI +VSYTvW PIEHMRK MRHYWXV] I\TIVMIRGI MR QEREKMRK -RHMER STIVEXMSRW ERH FVSEH WIVZMGI
SJJIVMRKW XLEX GSZIVEPQSWX IZIV] TEVX SJ XLIZEPYI GLEMR XLI +VSYT LEW FIIR I\TERHMRK MXW PSGEP QERYJEGXYVMRK
WIVZMGI ERH GSQTSRIRX WYTTP] GLEMR WYTTSVX MR -RHME XS FIRIJMX JVSQ XLI -RHMER +SZIVRQIRXvWw1EOIMR-RHMEx
MRMXMEXMZIWERHGEREHHVIWWFSXLXLIHSQIWXMG-RHMERQEVOIXERHI\TSVXHIQERHWERHLEWLIPTIHGIVXEMR'LMRIWI
GYWXSQIVWXSHIZIPSTFYWMRIWWERHKVEFQSVIQEVOIXWLEVIWMR-RHME;II\TIGXXLI-RHMERQERYJEGXYVMRKFYWMRIWW
[MPPGSRXMRYIXSWIILIEPXL]KVS[XLMR
;MXLXLIWYFWIUYIRXWXEFMPMWEXMSRSJKPSFEPERH'LMRIWIIGSRSQ]MRXLI WIGSRHUYEVXIVSJ[IWE[FYWMRIWW
MQTVSZIQIRX KIRIVEXIH JVSQXLIWI MRMXMEXMZIW ERH WEPIWMR XLI WIGSRHLEPJ SJ [MXRIWWIH KVS[XL;MXLQSVI
KVSWWQEVKMRKIRIVEXIHJVSQMRGVIEWISJWEPIWMRXLIWIGSRHLEPJSJERHXLIMRGVIEWISJSXLIVMRGSQIMRGPYHMRK
JSVIMKRI\GLERKIKEMR XLI+VSYTvWRIXTVSJMXMQTVSZIHMRXLIWIGSRHLEPJSJ
%WE[LSPI VIZIRYI JSV XLI]IEV [EW97 QMPPMSR[LMGL VITVIWIRXWEHIGVIEWI SJ 97QMPPMSRSV
[LIRGSQTEVIH [MXLXLITVMSV ]IEVvW VIZIRYI SJ 97 QMPPMSR 4VSJMX JSVXLI ]IEV EXXVMFYXEFPIXS
S[RIVW SJXLI 'SQTER] [EW 97QMPPMSR [LIRGSQTEVIH[MXLXLEXJSVXLITVMSV ]IEVSJ 97QMPPMSR &EWMG
IEVRMRKWTIVWLEVIJSVXLI]IEV[IVI97GIRXW
-R2SZIQFIVXLI+VSYTGSQTPIXIHERMQTSVXERXEGUYMWMXMSRHIEP[MXL1MGVSWSJX1SFMPI3]ERHEGUYMVIHMXW
:MIXREQJEGMPMX]ERHGIVXEMRSXLIVEWWIXWYXMPMWIHMRXLIGSRHYGXSJMXWJIEXYVITLSRIFYWMRIWWERHEPWSMR(IGIQFIV
XLI+VSYTvWGSPPEFSVEXMSR[MXL2SOME8IGLRSPSKMIW0XHw2SOMEw ERH,1(KPSFEP3]w,1(w [EWSJJMGMEPP]
MQTPIQIRXIH[MXLEZMI[XSFYMPHMRKEKPSFEPP]WYGGIWWJYPFYWMRIWWMRXLIJMIPHSJ2SOMEFVERHIHQSFMPITLSRIWERH
XEFPIXW
*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 480
',%-61%2v778%8)1)28
4VMGIIVSWMSRTVIWWYVIERHGSQTIXMXMSRJVSQTIIVWEVIEP[E]WMRXLILERHWIXQERYJEGXYVMRKQEVOIX8SHMJJIVIRXMEXI
JVSQSYVGSQTIXMXSVWSYVIRHXSIRHLERHWIXQERYJEGXYVMRKWIVZMGIWWSPYXMSRW[LMGLLEZIPSRKFIIRETTVIGMEXIH
F]SYVGYWXSQIVW[IVIGVMXMGEPMR[MRRMRKFYWMRIWWIWMRWYGLGLEPPIRKMRKQEVOIXIRZMVSRQIRX;ILEHXEOIREGXMSRW
XSVIQEMRPIERFYXEKMPIERHGSRXVSPSYVQERYJEGXYVMRKERHSTIVEXMRKI\TIRWIWERHVEXMSREPMWIHSYVGSWXWXVYGXYVI
[LMGL IREFPIH YW XS VIWTSRH XS GLEPPIRKIW MR E H]REQMG QEVOIX ;I GSQQMXXIH XS HIHMGEXI VIWSYVGIW SR
EYXSQEXMSRMRXSSYVSTIVEXMSRWXSIRLERGISYVTVSHYGXMZMX]ERH]MIPHERHGSQTIXMXMZIRIWW,MKLIRHWQEVXTLSRIW
GSRXMRYIHXS TYVWYIETTIEPMRK MRHYWXVMEPHIWMKRW [MXL HMWVYTXMZI JIEXYVIW EWXLIMVWIPPMRK TSMRXW [LMPI QMH XS PS[
IRH WQEVX TLSRIW XIRHIH XS EHSTX LMKL WTIGMJMGEXMSRW FYX [MXL E QSVI EJJSVHEFPI TVMGI 8LIWI GYWXSQIV
VIUYMVIQIRXW TSWIH STTSVXYRMXMIW ERH GLEPPIRKIW XS YW ;MXL GSQQMXQIRX XS HIHMGEXI VIWSYVGIW XS SYV 6
(
VIWIEVGL ERH HIZIPSTQIRX ERH QERYJEGXYVMRK GETEFMPMXMIW [I HIQSRWXVEXIH TVSZIR GSQTIXIRG] XS HIZIPST
HMJJIVIRXMEXIHERHGYWXSQMWIHWSPYXMSRWJSVXLIGYWXSQIVWERHKMZIWXLI+VSYTREXYVEPEHZERXEKIW2I[GYWXSQIV
HIZIPSTQIRXIJJSVXW[MPP GSRXMRYI ERH [I FIPMIZI[IEVI [IPP TSWMXMSRIH GSYTPIH [MXLXLIWXVEXIKMG TEVXRIVWLMTW
[MXL'LMRIWIGYWXSQIVWXSGSRXMRYIHVMZMRKXLIKVS[XLMRXS
0SSOMRKELIEHXLIWPS[HS[RSJ'LMREvWIGSRSQ][MPPYRHSYFXIHP]GSRXVMFYXIXSEFYQTMIVJMRERGMEPIRZMVSRQIRX
FYXMXMWWXMPPERXMGMTEXIHXSFIXLIPEVKIWXGSRXVMFYXSVXSKPSFEPKVS[XLEWMXWIGSRSQ]XVERWMXWXSLMKLIVZEPYIEHHMRK
QERYJEGXYVMRKWIVZMGIWERHFIGSQIWQSVIGSRWYQIVHVMZIR8LI+VSYTLEWXSQEOIGSRXMRYSYWMQTVSZIQIRXERH
VIQEMRGSQTIXMXMZI;IEMQXSFIXXIVWIVZISYVWXVEXIKMGGYWXSQIVWF]RSXSRP]SJJIVMRKLEVH[EVIMRXIKVEXIHHIWMKR
ERHQERYJEGXYVMRKWSJX[EVIHIZIPSTQIRXERHWYTTP]GLEMRQEREKIQIRXWIVZMGIWFYXEPWSFVSEHIRMRKSYVWGSTI
SJIRHXSIRHWIVZMGITPEXJSVQXSSXLIVTEVXWSJXLIZEPYIGLEMRPMOIEJXIVWEPIWWIVZMGIWERHJYPJMPPMRKSYVSFPMKEXMSRW
EWERIRZMVSRQIRXEPJVMIRHP]GSVTSVEXISVKERMWEXMSR
%QMHXLIHS[RXYVRSJIGSRSQ]ERHFYWMRIWWMRXLIJMVWXLEPJSJXLI+VSYTvWIRXMVIWXEJJLEZITIVJSVQIHXLIMV
VSPIWZMKMPERXP]ERH[SVOIHHMPMKIRXP]ERHWXVMZIHLEVHXSQIIXXLILIEH[MRHWHYVMRKFEHXMQIWERHQMRMQMWIHXLI
RIKEXMZIMQTEGXWXSXLI+VSYT*SVXLMW-[SYPHPMOIXSI\XIRHQ]KVEXMXYHIXSXLIQEREKIQIRXERHEPPWXEJJ1ER]
XLEROWXSXLIGYWXSQIVWvWLEVILSPHIVWvFYWMRIWWTEVXRIVWvERHXLIFSEVHSJHMVIGXSVWvWYTTSVXXSXLIQEREKIQIRX
XIEQMRXLITEWX]IEV;IEMQXSGSRXMRYIXSI\IGYXI[IPPERHHIPMZIVIZIRFIXXIVVIWYPXWMRXLI]IEVWXSGSQI
;MXLFIWXVIKEVHW
',-,=Y=ERK
%GXMRK'LEMVQER
,SRK/SRK1EVGL
*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 481
238)7838,)'32730-(%8)(
*-2%2'-%078%8)1)287
*SVXLI]IEVIRHIH(IGIQFIV
*-2%2'-%0-278691)287'SRXMRYIH

G *EMVZEPYIQIEWYVIQIRXWSJJMRERGMEPMRWXVYQIRXW'SRXMRYIH
*EMVZEPYISJXLI+VSYTvWJMRERGMEPEWWIXWERHJMRERGMEPPMEFMPMXMIWXLEXEVIQIEWYVIHEXJEMV
ZEPYISREVIGYVVMRKFEWMW'SRXMRYIH
7IRWMXMZMX]
VIPEXMSRWLMT
*MRERGMEPEWWIXW *EMVZEPYI :EPYEXMSRXIGLRMUYIW 7MKRMJMGERX SJYRSFWIVZEFPI
JMRERGMEPPMEFMPMXMIW *EMVZEPYIEWEX LMIVEVGL] ERHOI]MRTYXW YRSFWIVZEFPIMRTYXW MRTYXWXSJEMVZEPYI

97v 97

0MWXIHIUYMX]MRZIWXQIRXW 0MWXIHIUYMX] 2MP 0IZIP 5YSXIHFMHTVMGIWMR 2% 2%
GPEWWMJMIHEWEZEMPEFPI MRZIWXQIRXW EREGXMZIQEVOIX
JSVWEPIMRZIWXQIRXWMR z
XLIGSRWSPMHEXIH
JMRERGMEPWXEXIQIRXW
*SV[EVHJSVIMKRI\GLERKI 0MEFMPMXMIW 0MEFMPMXMIW 0IZIP *EMVZEPYIHIVMZIHJVSQ 2% 2%

GSRXVEGXWGPEWWMJMIHEW z z SFWIVZEFPIJSV[EVH
SXLIVVIGIMZEFPIWERH I\GLERKIVEXIWEXXLI
SXLIVTE]EFPIWMRXLI IRHSJXLIVITSVXMRKTIVMSH
GSRWSPMHEXIHWXEXIQIRX
SJJMRERGMEPTSWMXMSR
4VMZEXIJYRHGPEWWMJMIHEW -RZIWXQIRXMRE -RZIWXQIRXMRE 0IZIP *EMVZEPYIHIVMZIHJVSQ 2% 2%

%*7MRZIWXQIRXMRXLI TVMZEXIJYRH TVMZEXIJYRH SFWIVZEFPIQEVOIXZEPYIW
GSRWSPMHEXIHJMRERGMEP HSQMGMPIHMRXLI HSQMGMPIHMRXLI SJYRHIVP]MRKEWWIXW
WXEXIQIRXW 'E]QER-WPERHW 'E]QER-WPERHW UYSXIHF]VIPIZERXWXSGO
z z I\GLERKIWEXXLIIRH
SJXLIVITSVXMRKTIVMSH
-RZIWXQIRXMRMRXIVIWX -RZIWXQIRXMR -RZIWXQIRXMR 0IZIP -RGSQIETTVSEGL{HMWGSYRXIH )\TIGXIHKYEVERXIIH 8LILMKLIVXLI

FIEVMRKMRWXVYQIRXW MRXIVIWXFIEVMRK MRXIVIWXFIEVMRK GEWLJPS[QIXLSH[EWYWIHXS MRXIVIWXVEXIQEMRP] I\TIGXIH
GPEWWMJMIHEWWLSVXXIVQ MRWXVYQIRXW MRWXVYQIRXW GETXYVIXLITVIWIRXZEPYISJXLI XEOIRMRXSEGGSYRX KYEVERXIIHMRXIVIWX
MRZIWXQIRXWHIWMKREXIH z z I\TIGXIHVIXYVRSRETVYHIRX HMJJIVIRXGSYRXIVTEVX VEXIXLILMKLIVXLI
EWJMRERGMEPEWWIXWEX FEWMWEWWYQIHXSETTVS\MQEXI JMRERGMEPMRWXMXYXMSR JEMVZEPYIERH
*:840MRXLIGSRWSPMHEXIH XLIQMRMQYQVIXYVRFEWIHSR [LMGLVERKIHJVSQ ZMGIZIVWE
JMRERGMEPWXEXIQIRXW XLI+VSYTvWI\TIVMIRGI[MXLXLI XS
HITSWMXW[LMGLLEZIQEXYVIH XS
XSHEXI TIVERRYQ
'2-HIJMRIHMRRSXI 'SRZIVXMFPI 2MP 0IZIP &MRSQMEPSTXMSRTVMGMRKQSHIP )\TIGXIHZSPEXMPMX]SJ %RMRGVIEWIMRXLI

HIWMKREXIHEWJMRERGMEP RSXIW RMP I\TIGXIHZSPEXMPMX]
EWWIXWEX*:840MRXLI z )\TIGXIHZSPEXMPMX] RMP XEOMRKMRXSEGGSYRX YWIHMRMWSPEXMSR
GSRWSPMHEXIHJMRERGMEP XLILMWXSVMGEPZSPEXMPMX] [SYPHVIWYPXMRER
WXEXIQIRXW 7LEVITVMGI97RMP SJWLEVITVMGIWSJ MRGVIEWIMRXLIJEMV
XLITYFPMGPMWXIH ZEPYIQIEWYVIQIRX
)\IVGMWITVMGI97RMP GSQTERMIWXLEXEVI SJXLIGSRZIVXMFPI
GSRWMHIVIHXSFI RSXIW
GSQTEVEFPI
'2--HIJMRIHMRRSXI 'SRZIVXMFPI 2MP 0IZIP *EMVZEPYIHIVMZIHJVSQQEVOIX 2% 2%

HIWMKREXIHEWJMRERGMEP RSXIW ZEPYISJXLIWLEVIWSJ1ERKS
EWWIXWEX*:840MRXLI z -RXIVREXMSREPMRVIGIRX
GSRWSPMHEXIHJMRERGMEP MRZIWXQIRXXVERWEGXMSRW
WXEXIQIRXW
8LIVI[IVIRSXVERWJIVWFIX[IIRPIZIPXSHYVMRKXLI]IEVWIRHIH(IGIQFIVERH
*SV XLI SXLIV JMRERGMEPEWWIXWERHJMRERGMEP PMEFMPMXMIW XLI HMVIGXSVWSJ XLI 'SQTER]GSRWMHIV XLEX XLI
GEVV]MRK EQSYRXW SJ JMRERGMEP EWWIXW ERH JMRERGMEP PMEFMPMXMIW VIGSKRMWIH MR XLI GSRWSPMHEXIH JMRERGMEP
WXEXIQIRXWETTVS\MQEXIXLIMVJEMVZEPYIW
*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 482
238)7838,)'32730-(%8)(
*-2%2'-%078%8)1)287
*-2%2'-%0-278691)287'SRXMRYIH

H *MRERGMEPEWWIXWERHJMRERGMEPPMEFMPMXMIWWYFNIGXXSSJJWIXXMRK
8LIHMWGPSWYVIWWIXSYXMRXLIXEFPIFIPS[MRGPYHIJMRERGMEPEWWIXWERHJMRERGMEPPMEFMPMXMIWXLEXEVISJJWIXMR
XLI+VSYTvWGSRWSPMHEXIHWXEXIQIRXSJJMRERGMEPTSWMXMSR
8LI +VSYT GYVVIRXP] LEW E PIKEPP] IRJSVGIEFPI VMKLX XS WIX SJJ GIVXEMR FERO FEPERGIW ERH WLSVXXIVQ
MRZIWXQIRXW[MXLFEROFSVVS[MRKWEXXLIWEQIFEROXLEXEVIHYIXSFIWIXXPIHSRXLIWEQIHEXIERHXLI
+VSYTMRXIRHWXSWIXXPIXLIWIFEPERGIWSRERIXFEWMW
%WEX(IGIQFIV

+VSWWEQSYRXW
SJVIGSKRMWIH 2IXEQSYRXWSJ
JMRERGMEP JMRERGMEPEWWIXW
PMEFMPMXMIW PMEFMPMXMIW
+VSWWEQSYRXW EWWIXWWIXSJJMR TVIWIRXIHMRXLI
SJVIGSKRMWIH XLIGSRWSPMHEXIH GSRWSPMHEXIH
*MRERGMEPEWWIXWPMEFMPMXMIW JMRERGMEP WXEXIQIRXSJ WXEXIQIRXSJ
WYFNIGXXSSJJWIXXMRK EWWIXWPMEFMPMXMIW JMRERGMEPTSWMXMSR JMRERGMEPTSWMXMSR
97v 97v 97v

&EROFEPERGIW z

&EROFSVVS[MRKW z

-RXIVIWXVIGIMZEFPIW

-RXIVIWXTE]EFPIW z

%WEX(IGIQFIV

+VSWWEQSYRXW
SJVIGSKRMWIH 2IXEQSYRXWSJ
JMRERGMEP JMRERGMEPEWWIXW
PMEFMPMXMIW PMEFMPMXMIW
+VSWWEQSYRXW EWWIXWWIXSJJMR TVIWIRXIHMRXLI
SJVIGSKRMWIH XLIGSRWSPMHEXIH GSRWSPMHEXIH
*MRERGMEPEWWIXWPMEFMPMXMIW JMRERGMEP WXEXIQIRXSJ WXEXIQIRXSJ
WYFNIGXXSSJJWIXXMRK EWWIXWPMEFMPMXMIW JMRERGMEPTSWMXMSR JMRERGMEPTSWMXMSR
97v 97v 97v

&EROFEPERGIW z

7LSVXXIVQMRZIWXQIRXW z

&EROFSVVS[MRKW z

-RXIVIWXVIGIMZEFPIW

-RXIVIWXTE]EFPIW z

*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 483
238)7838,)'32730-(%8)(
*-2%2'-%078%8)1)287
7)+1)28-2*361%8-32
8LI+VSYTHIXIVQMRIWMXWSTIVEXMRKWIKQIRXWFEWIHSRMRXIVREPVITSVXWVIZMI[IHF]XLIGLMIJSTIVEXMRK
HIGMWMSRQEOIVXLI'LMIJ)\IGYXMZI3JJMGIVJSVXLITYVTSWISJEPPSGEXMRKVIWSYVGIWXSXLIWIKQIRXERHXS
EWWIWWMXWTIVJSVQERGI
8LI+VSYTvWSTIVEXMSRWEVISVKERMWIHMRXSXLVIISTIVEXMRKWIKQIRXWFEWIHSRXLIPSGEXMSRSJGYWXSQIVW{
%WME)YVSTIERH%QIVMGE
7IKQIRXVIZIRYIERHVIWYPXW
8LI+VSYTvWVIZIRYIMWQEMRP]EVMWMRKJVSQXLIQERYJEGXYVMRKWIVZMGIWXSMXWGYWXSQIVWMRGSRRIGXMSR[MXLXLI
TVSHYGXMSRSJLERHWIXW
8LIJSPPS[MRKMWEREREP]WMWSJXLI+VSYTvWVIZIRYIERHVIWYPXWF]STIVEXMRKERHVITSVXEFPIWIKQIRXW

97v 97v

7IKQIRXVIZIRYII\XIVREPWEPIW
%WME
)YVSTI
%QIVMGE
8SXEP

7IKQIRXTVSJMX
%WME
)YVSTI
%QIVMGE

3XLIVMRGSQIKEMRWERHPSWWIW
+IRIVEPERHEHQMRMWXVEXMZII\TIRWIW
6IWIEVGLERHHIZIPSTQIRXI\TIRWIW
-QTEMVQIRXPSWWVIGSKRMWIHJSVMRXIVIWXWMREWWSGMEXIW z
-RXIVIWXI\TIRWISRFEROFSVVS[MRKW
7LEVISJPSWWSJEWWSGMEXIW
7LEVISJPSWWSJNSMRXZIRXYVIW
4VSJMXFIJSVIXE\

1ENSVMX]SJXLI+VSYTvWWEPIWXS%WMERGYWXSQIVWMWEXXVMFYXIHXSXLI46'
7IKQIRXTVSJMXVITVIWIRXWXLIKVSWWTVSJMXIEVRIHF]IEGLWIKQIRXERHXLIWIVZMGIMRGSQIMRGPYHIHMRSXLIV
MRGSQI EJXIVHIHYGXMRKEPPWIPPMRKI\TIRWIW8LMWMWXLIQIEWYVIVITSVXIHXSXLI'LMIJ)\IGYXMZI3JJMGIVJSVXLI
TYVTSWIWSJVIWSYVGIEPPSGEXMSRERHTIVJSVQERGIEWWIWWQIRX
*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 484
238)7838,)'32730-(%8)(
*-2%2'-%078%8)1)287
7)+1)28-2*361%8-32'SRXMRYIH

7IKQIRXEWWIXWERHPMEFMPMXMIW
8LIJSPPS[MRKMWEREREP]WMWSJXLI+VSYTvWEWWIXWERHPMEFMPMXMIWF]STIVEXMRKWIKQIRXW

97v 97v

%77)87
7IKQIRXEWWIXW
%PPSGEXIH
%WME
)YVSTI
%QIVMGE
8SXEP
9REPPSGEXIH
4VSTIVX]TPERXERHIUYMTQIRX
-RZIRXSVMIW
'EWLERHFEROHITSWMXW
3XLIVW
'SVTSVEXIEWWIXW
'SRWSPMHEXIHXSXEPEWWIXW

0-%&-0-8-)7
7IKQIRXPMEFMPMXMIW
%PPSGEXIH
)YVSTI
%QIVMGE
8SXEP
9REPPSGEXIH
8VEHIERHSXLIVTE]EFPIW
3XLIVW
'SVTSVEXIPMEFMPMXMIW

'SRWSPMHEXIHXSXEPPMEFMPMXMIW

*SVXLITYVTSWIWSJQSRMXSVMRKWIKQIRXTIVJSVQERGIWERHEPPSGEXMRKVIWSYVGIW EQSRK WIKQIRXW XVEHI

VIGIMZEFPIWJVSQ%WMESTIVEXMSRWEVIEPPSGEXIHXS%WMEWIKQIRX[LMPIGIVXEMRTVSTIVX]TPERXERHIUYMTQIRX
MRZIRXSVMIW XVEHIERHSXLIVVIGIMZEFPIWERHGEWLERHGEWLIUYMZEPIRXWVIPEXMRKXS)YVSTI ERH%QIVMGE
STIVEXMSRWEVIEPPSGEXIHXS)YVSTIERH%QIVMGEWIKQIRXW7IKQIRXPMEFMPMXMIWVITVIWIRXGIVXEMRXVEHIERH
SXLIVTE]EFPIWERHTVSZMWMSRJSV[EVVERX]VIPEXMRKXSXLI)YVSTIERH%QIVMGESTIVEXMSRW
*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 485
238)7838,)'32730-(%8)(
*-2%2'-%078%8)1)287
7)+1)28-2*361%8-32'SRXMRYIH

7IKQIRXEWWIXWERHPMEFMPMXMIW
3XLIVMRJSVQEXMSR
=IEVIRHIH(IGIQFIV

%WME )YVSTI %QIVMGE 9REPPSGEXIH 'SRWSPMHEXIH
97v 97v 97v 97v 97v

%QSYRXWMRGPYHIHMRXLIQIEWYVIQIRX
SJWIKQIRXTVSJMXSVPSWWSV
WIKQIRXEWWIXWERHPMEFMPMXMIW
'ETMXEPEHHMXMSRW z

(ITVIGMEXMSRERHEQSVXMWEXMSR z
+EMR PSWWSRHMWTSWEPERH[VMXISJJ
SJTVSTIVX]TPERXERHIUYMTQIRX
ERHTVITEMHPIEWITE]QIRXW z
%PPS[ERGIVIZIVWEPSJEPPS[ERGI
JSVHSYFXJYPHIFXWRIX z z
4VSZMWMSRJSV[EVVERX] z z z
%QSYRXWVIKYPEVP]TVSZMHIHXSXLI
GLMIJSTIVEXMRKHIGMWMSRQEOIVFYX
RSXMRGPYHIHMRXLIQIEWYVIQIRXSJ
WIKQIRXTVSJMXSVPSWW
-QTEMVQIRXPSWWVIGSKRMWIHJSV
%*7MRZIWXQIRXW z z z
TVSTIVX]TPERXERHIUYMTQIRX z z z
+EMRJVSQGLERKIWMRJEMVZEPYISJ
JMRERGMEPEWWIXWHIWMKREXIH
EW*:840 z z z
;VMXIHS[RSJMRZIRXSVMIWXS
RIXVIEPMWEFPIZEPYI z z z

*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 486
238)7838,)'32730-(%8)(
*-2%2'-%078%8)1)287
7)+1)28-2*361%8-32'SRXMRYIH

7IKQIRXEWWIXWERHPMEFMPMXMIW'SRXMRYIH
3XLIVMRJSVQEXMSR'SRXMRYIH
=IEVIRHIH(IGIQFIV

%WME )YVSTI %QIVMGE 9REPPSGEXIH 'SRWSPMHEXIH
97v 97v 97v 97v 97v

%QSYRXWMRGPYHIHMRXLIQIEWYVIQIRX
SJWIKQIRXTVSJMXSVPSWWSV
WIKQIRXEWWIXWERHPMEFMPMXMIW
'ETMXEPEHHMXMSRW z

(ITVIGMEXMSRERHEQSVXMWEXMSR z
+EMR PSWWSRHMWTSWEPSJTVSTIVX]
TPERXERHIUYMTQIRXERH
TVITEMHPIEWITE]QIRXW z
6IZIVWEPSJ EPPS[ERGIJSV
HSYFXJYPHIFXWRIX z z
4VSZMWMSRJSV[EVVERX] z
%QSYRXWVIKYPEVP]TVSZMHIHXSXLI
GLMIJSTIVEXMRKHIGMWMSRQEOIVFYX
RSXMRGPYHIHMRXLIQIEWYVIQIRX
SJWIKQIRXTVSJMXSVPSWW
ER%*7MRZIWXQIRX z z z
MRXIVIWXWMREWWSGMEXIW z z z
TVSTIVX]TPERXERHIUYMTQIRX z z z
+EMRJVSQGLERKIWMRJEMVZEPYISJ
JMRERGMEPEWWIXWHIWMKREXIH
EW*:840 z z z
0SWWJVSQGLERKIWMRJEMVZEPYISJ
JMRERGMEPEWWIXWGPEWWMJMIHEW
LIPHJSVXVEHMRK z z z
;VMXIHS[RSJMRZIRXSVMIWXS
RIXVIEPMWEFPIZEPYI z z z

*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 487
238)7838,)'32730-(%8)(
*-2%2'-%078%8)1)287
7)+1)28-2*361%8-32'SRXMRYIH

+ISKVETLMGEPMRJSVQEXMSR
8LI+VSYTvWSTIVEXMSRWEVIPSGEXIHMRXLI46'GSYRXV]SJHSQMGMPI 9RMXIH7XEXIWSJ%QIVMGEw97%x 9RMXIH
1I\MGER7XEXIWw1I\MGSx -RHMEERHSXLIVGSYRXVMIW
-RJSVQEXMSREFSYXXLI+VSYTvWVIZIRYIJVSQI\XIVREPGYWXSQIVWERHMXWRSRGYVVIRXEWWIXWMWTVIWIRXIHFEWIH
SRKISKVETLMGEPPSGEXMSRSJSTIVEXMSRW
6IZIRYIJVSQ 2SRGYVVIRX
I\XIVREPGYWXSQIVW EWWIXW

97v 97v 97v 97v

46'GSYRXV]SJHSQMGMPI
97%
1I\MGS
-RHME
3XLIVGSYRXVMIW

2SXI 2SRGYVVIRXEWWIXWI\GPYHIHKSSH[MPPMRXERKMFPIEWWIXWJMRERGMEPMRWXVYQIRXWERHHIJIVVIHXE\EWWIXW
-RJSVQEXMSREFSYXQENSVGYWXSQIVW
6IZIRYIJVSQGYWXSQIVWSJXLIGSVVIWTSRHMRK]IEVWGSRXVMFYXMRKSZIV SJXLIXSXEPWEPIWSJXLI+VSYTEVI
EWJSPPS[W

97v 97v

'YWXSQIV%
'YWXSQIV&
'YWXSQIV'
'YWXSQIV(

6IZIRYIJVSQTVSZMWMSRSJQERYJEGXYVMRKWIVZMGIWXSGYWXSQIVWPSGEXIHMR%WMEMRGSRRIGXMSR[MXLXLITVSHYGXMSRSJLERHWIXW

8LI]HMHRSXGSRXVMFYXISZIV SJXLIXSXEPWEPIWSJXLI+VSYTMR
*-,13&-0)0-1-8)(%229%06)4368
EXHIBIT 26
PAGE 488
Exhibit 27

7XSGO'SHI

,32,%-46)'-7-32-2(9786='308(

%RRYEP6ITSVX

%RRYEP6ITSVX;IFWMXI
1EVOIX3FWIVZEXMSR4SWX7]WXIQLXXTQSTWX[WIGSQX[
'SQTER];IFWMXILXXT[[[JS\GSRRGSQX[
4VMRXMRK(EXI%TVMP
EXHIBIT 27
PAGE 489
86%270%8-32 -7 -28)2()( *36 6)*)6)2') 320= %2( 238,-2+ )07) 8,)
'314%2= ,)6)&= (-7'0%-17 %2= %2( %00 0-%&-0-8-)7 ;,%873):)6 *36
8,) 86%270%8-32 8,) ',-2)7) 8)<8 3* 8,) %229%0 6)4368 7,%00
+3:)62 %2= %2( %00 1%88)67 6)0%8)( 83 8,) -28)646)8%8-32 3* 8,)
79&.)'81%88)678%8)(,)6)-2
EXHIBIT 27
PAGE 490
-7TSOIWTIVWSR (ITYX]7TSOIWTIVWSR
2EQI7MQSR,WMRK 2EQI;IRQMR'LY
8MXPI 7TSOIWTIVWSR 8MXPI (MVIGXSVSJ4YFPMG6IPEXMSRW3JJMGI
8IP 8IP
)QEMPWXSGOEJJEMVW$JS\GSRRGSQ
--'SRXEGXMRJSVQEXMSRSJXLILIEHSJJMGIFVERGLSJJMGIWERHJEGXSVMIW
,IEHSJJMGI
%HH2S>LSRKWLER6SEH8YGLIRK-RHYWXVMEP>SRI8YGLIRK(MWXVMGX2I[8EMTIM'MX]
8IP

,WMRGLY7GMIRGI4EVO&VERGL3JJMGI
%HH * 2S ,WMRER 6SEH ,WMRGLY 7GMIRGI ERH -RHYWXVMEP 4EVO )EWX %VIE ,WMRGLY
'MX]
8IP

2IMLY&VERGL3JJMGI
%HH**2S.MLY6SEH2IMLY(MWXVMGX8EMTIM'MX]
8IP

'EPMJSVRME97 &VERGL3JJMGI
%HH71E]S%ZI'MX]SJ-RHYWXV]'%97%
8IP

,Y]YI*EGXSV]
%HH2S>ML]SY7XVIIX8YGLIRK-RHYWXVMEP>SRI8YGLIRK(MWXVMGX2I[8EMTIM'MX]
8IP

1MRWLIRK*EGXSV]
%HH2S1MRWLIRK6SEH8YGLIRK-RHYWXVMEP>SRI8YGLIRK(MWXVMGX2I[8EMTIM'MX]
8IP

(MRKTY2S*EGXSV]
%HH2S7IGXMSR>LSRK]ERK6SEH8YGLIRK(MWXVMGX2I[8EMTIM'MX]
8IP

(MRKTY2S*EGXSV]
%HH*2S7IGXMSR>LSRK]ERK6SEH8YGLIRK(MWXVMGX2I[8EMTIM'MX]
8IP

(MRKTY2S*EGXSV]
%HH*2S7IGXMSR>LSRK]ERK6SEH8YGLIRK(MWXVMGX2I[8EMTIM'MX]
8IP

EXHIBIT 27
PAGE 491
2EROER*EGXSV]
%HH2S7IGXMSR2EROER6SEH0Y^LY8S[RWLMT8ES]YER'SYRX]
8IP

---7LEVI8VERWJIV%KIRG]
2EQI +VERH*SVXYRI7IGYVMXMIW'S0XH
%HHVIWW *2S7IGXMSR'LYRK,WMES;IWX6SEH8EMTIM'MX]
8IP
;IFWMXI LXXT[[[KJSVXYRIGSQX[

-: 'SRXEGX MRJSVQEXMSR SJ XLI 'IVXMJMIH 4YFPMG %GGSYRXERXW JSV XLI 0EXIWX *MRERGMEP
6ITSVX
2EQI %GGSYRXERX;Y,ER'LMERH'LERK1MRK,YM
'4%*MVQ 4VMGI[EXIVLSYWI'SSTIVW4[' 8EM[ER
%HHVIWW *2S7IGXMSR/IIPSRK6SEH8EMTIM'MX]
8IP
;IFWMXI LXXT[[[T[GX[

:3ZIVWIEWXVEHITPEGIWJSVPMWXIHRIKSXMEFPIWIGYVMXMIW
0SRHSR7XSGO)\GLERKI LXXT[[[PSRHSRWXSGOI\GLERKIGSQ

:-'SQTER];IFWMXI LXXT[[[JS\GSRRGSQ
EXHIBIT 27
PAGE 492
8EFPISJ'SRXIRXW
- 0IXXIVXS7LEVILSPHIVW
-- 'SQTER]-RXVSHYGXMSR
% *SYRHMRKHEXI*IFVYEV]
& *SVQEXMSR,MWXSV]
--- 'SVTSVEXI+SZIVRERGI6ITSVX
% 3VKERM^EXMSR
& -QTPIQIRXEXMSRSJGSVTSVEXIKSZIVRERGI
'
( %PXIVREXMSRSJ'4%
) 8LI'SQ
EGGSYRXMRKQEXXIVWLEWMRXLIQSWXVIGIRX]IEVLIPHETSWMXMSREXXLIEGGSYRXMRKJMVQSJMXW
'4%SVEXEREJJMPMEXIHIRXIVTVMWI
* 8VERWJIV
TPIHKISJWXSGOIUYMX]F]HMVIGXSVWWYTIVZMWSVWQEREKIVMEPSJJMGIVWERHLSPHIVWSJ
SVQSVISJGSQTER]WLEVIW
+ -RJSVQEXMSRSRVIPEXMSRWLMTWEQSRKXLIXSTXIRWLEVILSPHIVW
, 'SQFMRIHWLEVILSPHMRKTIVGIRXEKI
-: 'SQTER]7LEVIWERH*YRH6EMWMRK
% 'SQTER]GETMXEPERHWLEVIW
& 7IGXMSRSR'SVTSVEXI&SRHW
' 4VIJIVVIH7LEVIW[MXL[EVVERXW
( +PSFEP(ITSWMXSV]6IGIMTXW+(6
) 7YFWGVMTXMSRSJ[EVVERXWJSVIQTPS]IIW
* 2EQISJQEREKIVWLSPHMRK[EVVERXWJSVIQTPS]IIWERHXSTXIRIQTPS]IIWMRXIVQWSJ
WYFWGVMTXMSRSJ[EVVERXWERHXLIEGUYMWMXMSRWXEXYW
+ 7YFWGVMTXMSRSJRI[WLEVIWJSVIQTPS]IIVIWXVMGXIHWXSGOW
, 2EQISJQEREKIVWLSPHMRKXLIRI[WLEVIWJSVIQTPS]IIVIWXVMGXIHWXSGOWERHXSTXIR
IQTPS]IIWMRXIVQWSJWYFWGVMTXMSRSJXLIRI[WLEVIERHXLIEGUYMWMXMSRWXEXYW
- MWWYERGISJRI[WLEVIWHYIXSEGUYMWMXMSRSJWLEVIWSJERSXLIVGSQTER]
. -QTPIQIRXEXMSRSJJYRHYWEKITPER
: 3TIVEXMSREP,MKLPMKLXW
% &YWMRIWW%GXMZMXMIW
& 4VSHYGXMSRERH7EPIW7XEXYW
' -RJSVQEXMSRSR)RZMVSRQIRXEP4VSXIGXMSR'SWXW
( 0EFSV6IPEXMSRW
:- *MRERGMEP7XERHMRK
% 1SWX6IGIRX=IEV'SRGMWI*MRERGMEP-RJSVQEXMSR
& 1SWX6IGIRX=IEV*MRERGMEP%REP]WMW
' %YHMX6ITSVXF]7YTIVZMWSVW
( 'SRWSPMHEXIH*MRERGMEP7XEXIQIRXW;MXL7YFWMHMEVMIW%YHMXIHF]'4%
:-- *MRERGMEP%REP]WMW
% ZW*MRERGMEP%REP]WMW
& ZW3TIVEXMRK6IWYPX%REP]WMW
' 'EWL*PS[%REP]WMW
:--- 7TIGMEP2SXIW
% 'SRWSPMHEXIH*MRERGMEP7XEXIQIRXWSJ%JJMPMEXIW
& %JJMPMEXIH'SQTERMIW6ITSVXW

EXHIBIT 27
PAGE 493
XEFPI
-RJSVQEXMSRSRMRZIWXIIW
2EQIW PSGEXMSRW ERH SXLIV MRJSVQEXMSR SJ MRZIWXII GSQTERMIW RSX MRGPYHMRK
MRZIWXIIWMR1EMRPERH'LMRE 4PIEWIVIJIVXSXEFPI
-RJSVQEXMSRSRMRZIWXQIRXWMR1EMRPERH'LMRE
%&EWMGMRJSVQEXMSR4PIEWIVIJIVXSXEFPI
& 7MKRMJMGERX XVERWEGXMSRW IMXLIV HMVIGXP] SV MRHMVIGXP] XLVSYKL E XLMVH EVIE [MXL
MRZIWXIIGSQTERMIW MRXLI1EMRPERH %VIE8LI'SQTER]ETTSMRXIH*S\GSRR*EV
XVERWEGXMSRW [IVI IPMQMREXIH MR XLI GSRWSPMHEXIH JMRERGMEP WXEXIQIRXW *SV

WMKRMJMGERX XVERWEGXMSRW SJ TVSGIWWMRK WIVZMGIW XVEHMRK VIGIMZEFPIW ERH TE]EFPIW
IRHSVWIQIRXWERHKYEVERXIIWSVGSPPEXIVEPWTVSZMHIHERHJMRERGMRKTPIEWIVIJIVXS
2SXI %&+ERH,
7)+1)28-2*361%8-32
+IRIVEPMRJSVQEXMSR
8LI +VSYT LEW EHSTXIH I'117 )IREFPIH 'SQTSRIRXW 1SHYPIW 1SZIW

7IVZMGIW WXVEXIK]ERHTVSZMHIHESRIWXSTWLSTXSMXWGYWXSQIVW[LMGLEVITVMQEVMP]
MR XLI ' MRHYWXVMIW [MXL E XSXEP WSPYXMSR JSV HIWMKR HIZIPSTQIRX IRKMRIIVMRK
TVSGYVIQIRX QERYJEGXYVMRK PSKMWXMGW ERH EJXIVWEPIW WIVZMGI 8LI +VSYT WIKVIKEXIW
STIVEXMRKWIKQIRXWJVSQFSXLEGYWXSQIVWIVZMGIERHTVSHYGXTIVWTIGXMZI
STIVEXMRK WIKQIRXW ERH VITSVXEFPI STIVEXMRK WIKQIRXW 3TIVEXMRK WIKQIRXW [LMGL

LEZI QIX GIVXEMR UYERXMXEXMZI XLVIWLSPH EVI HMWGPSWIH MRHMZMHYEPP] SV EKKVIKEXIP] EW
VITSVXEFPI STIVEXMRK WIKQIRXW SXLIV WIKQIRXW [LMGL LEZI RSX QIX XLI UYERXMXEXMZI
IPIGXVSRMG QERYJEGXYVMRK MRXIKVEXIH WIVZMGIW HITEVXQIRX [LMGL TVSZMHIW KPSFEP '

TVSHYGXMSRVIPEXIHSRIWXSTWIVZMGIWEWEVITSVXEFPISTIVEXMRKWIKQIRX
1IEWYVIQIRXSJWIKQIRXMRJSVQEXMSR
8LI GLMIJ STIVEXMRK HIGMWMSR QEOIV EWWIWWIW TIVJSVQERGI ERH EPPSGEXIW VIWSYVGIW SJ
XLI STIVEXMRK WIKQIRXW FEWIH S
MRGSQI EJXIV EHNYWXMRK XLI MRXIVREP GSWXW ERH EPPSGEXIH I\TIRWIW )\GITX JSV XLI
VIGSKRMXMSR SJ MRXIVREP GSWXW [LMGL
MRXIVREPGEPGYPEXMSRFEWMWXLISTIVEXMRK
HMWGPSWIHMR2SXI
7IKQIRXMRJSVQEXMSR
8LIJMRERGMEPMRJSVQEXMSRSJVITSVXEFPIWIKQIRXWTVSZMHIHXSGLMIJSTIVEXMRKHIGMWMSR

EXHIBIT 27
PAGE 494
QEOIVMWEWJSPPS[W
*SVXLI]IEVWIRHIH(IGIQFIV

)PIGXVSRMG )PIGXVSRMG
1ERYJEGXYVMRK 1ERYJEGXYVMRK
-RXIKVEXMSR7IVZMGI -RXIKVEXMSR7IVZMGI
2IXI\XIVREPVIZIRYI
6IZIRYIJVSQMRXIVREPGYWXSQIVW
7IKQIRXVIZIRYI
7IKQIRXTVSJMX

6IGSRGMPMEXMSRJSVWIKQIRXMRGSQIPSWW
7EPIW FIX[IIR
TEVXMIW VITSVXIH XS XLI GLMIJ STIVEXMRK HIGMWMSRQEOIV MW QIEWYVIH MR E QERRIV
GSRWMWXIRX[MXLXLEXMRXLIMRGSQIWXEXIQIRX
% VIGSRGMPMEXMSR SJ VITSVXEFPI WIKQIRX TVSJMX SV PSWW XS XLI TVSJMX FIJSVI XE\ ERH
HMWGSRXMRYIHSTIVEXMSRWJSVXLI]IEVWIRHIH(IGIQFIVERHMWTVSZMHIH
EWJSPPS[W
3TIVEXMRKVIZIRYI
8SXEPVITSVXIHWIKQIRXVIZIRYI
3XLIVSTIVEXMRKWIKQIRXVIZIRYI
)PMQMREXMSRSJMRXIVWIKQIRXVIZIRYI
8SXEPGSVTSVEXIVIZIRYI

4VSJMXERHPSWW
4VSJMXSJVITSVXIHWIKQIRX
4VSJMXSJSXLIVSTIVEXMRKWIKQIRXW
)PMQMREXMSRSJMRXIVWIKQIRXXVERWEGXMSRWERH
MRXIVREPGSWXWERHEPPSGEXIHI\TIRWIW
EHNYWXQIRXW
4VSJMXFIJSVIMRGSQIXE\

EXHIBIT 27
PAGE 495

+ISKVETLMGEPMRJSVQEXMSR
+ISKVETLMGEP MRJSVQEXMSR JSV XLI ]IEVW IRHIH (IGIQFIV ERH MW EW
JSPPS[W

2SRGYVVIRX 2SRGYVVIRX
6IZIRYI EWWIXW 6IZIRYI EWWIXW
97%
-VIPERH
'LMRE
7MRKETSVI
.ETER
8EM[ER
3XLIVW

1ENSVGYWXSQIVMRJSVQEXMSR
1ENSVGYWXSQIVMRJSVQEXMSRSJXLI+VSYTJSVXLI]IEVWIRHIH(IGIQFIVERH
MWEWJSPPS[W

6IZIRYIMRQMPPMSRW 6IZIRYIMRQMPPMSRW
'PMIRX)
'PMIRX'

EXHIBIT 27
PAGE 496
:-- *MRERGMEP%REP]WMW
% ZW*MRERGMEP%REP]WMW
9RMX288LSYWERH
6EXMSGLERKI
(MJJIVIRGI
=IEV EREP]WMWERH
-XIQ
I\TPEREXMSR
%QSYRX 2SXI
'YVVIRXEWWIXW
*YRHERH0SRKXIVQIUYMX]
2SXI
MRZIWXQIRXW
*M\IHEWWIXW
3XLIVEWWIXW
8SXEPEWWIXW
'YVVIRXPMEFMPMXMIW
3XLIVPMEFMPMXMIW
8SXEPPMEFMPMXMIW
'SQQSRWXSGO
'ETMXEPWYVTPYW
6IXEMRIHIEVRMRKW
3XLIV)UYMX] 2SXI
8VIEWYV]7XSGO
)UYMX]EXXVMFYXEFPIXSS[RIVWSJ

XLITEVIRX
2SRGSRXVSPPMRK)UYMX]

2SXI%REP]WMWMWVIUYMVIH[LIVIXLIZEVMERGIMWSZIV [MXLXLIXSXEPEQSYRXQSVIXLER28QMPPMSR
2SXI -R SVHIV XS KIX QSVI SVHIVW XLI 'SQTER] MRGVIEWIH MXW WXVEXIKMG MRZIWXQIRX MR .ETER 7SYXL /SVIE ERH

EFPIJSVWEPI MRZIWXQIRXW [EW HYI XS XLI
HIGPMRISJXLIKPSFEPWXSGOQEVOIXERHXLIWYFWXERXMEPVIHYGXMSRMRZEPYI

EXHIBIT 27
PAGE 497
& ZW3TIVEXMRK6IWYPX%REP]WMW
9RMX288LSYWERH
'LERKI
=IEV %QSYRX :EVMERGI
TIVGIRXEKI
-XIQ GLERKIH EREP]WMW

6IZIRYIW
'SWXSJVIZIRYIW
+VSWWTVSJMX
3TIVEXMRKI\TIRWIW
3TIVEXMRKMRGSQI
2SRSTIVEXMRKMRGSQI
-RGSQIPSWW FIJSVI

MRGSQIXE\IW
-RGSQIXE\FIRIJMX

I\TIRWI
2IXMRGSQIPSWW
3XLIVGSQTVILIRWMZI
2SXI
MRGSQI
8SXEPGSQTVILIRWMZI
2SXI
MRGSQI
:EVMERGIEREP]WMW
2SXI8LMW]IEVHYIXSXLIWLEVTETTVIGMEXMSRSJXLI97HSPPEVERHXLIZSPEXMPMX]SJXLIKPSFEPWXSGOQEVOIXXLI
JSVIMKR GYVVIRG] GSRZIVWMSR VEXI ERH XLI TVSJMXW ERH PSWWIW SJ XLI EZEMPEFPIJSVWEPI IZEPYEXMSR [IVI VIHYGIH
WYFWXERXMEPP][LMGLPIHXSXLIPSWWIWSJ3XLIV'SQTVILIRWMZI-RGSQIERH8SXEP'SQTVILIRWMZI-RGSQI
' 'EWL*PS[%REP]WMW
ZW0MUYMHMX]%REP]WMW
=IEV
6EXMS'LERKI
-XIQ
'EWLJPS[VEXMS
'EWL*PS[%HIUYEG]6EXMS
'EWLVIMRZIWXQIRXVEXMS
:EVMERGI%REP]WMW-RGEWIXLIZEVMERGIMWPIWWXLER RSEREP]WMWMWVIUYMVIH

(YVMRKXLMWTIVMSHXLITVSJMXMRGVIEWIHERHXLIEGGSYRXVIGIMZEFPI[EWGSPPIGXIHMREHZERGI
WSXLEXXLIRIXGEWLJPS[JVSQSTIVEXMRKEGXMZMXMIWMRGVIEWIH[LMGLPIHXSXLIWMKRMJMGERX
MRGVIEWISJXLIGEWLJPS[VEXMSERHXLIGEWLJPS[EHIUYEG]VEXMS

EXHIBIT 27
PAGE 498
'EWL*PS[*SVIGEWXMR
9RMX288LSYWERH
'EWLIRHMRK 4PERJSVGEWLIRHMRKFEPERGI
'EWLFIKMRRMRK 'EWLJPS[JVSQSTIVEXMRK 'EWLJPS[MR WLSVXEKI
FEPERGI
FEPERGI EGXMZMXMIW SYX
WLSVXEKI -RZIWXQIRX *MRERGMRK

EGXMZMXMIW EGXMZMXMIW

'EWLJPS[ZEVMERGIEREP]WMWJSV]IEV
3TIVEXMRKEGXMZMXMIWGSQTER]I\TIGXWVIZIRYIERHTVSJMX[MPPGSRXMRYIXSKVS[
-RZIWXQIRXEGXMZMXMIWGSQTER]I\TIGXWI\TERWMSRSJTVSHYGXMSRJEGMPMXMIWXSQIIXFYWMRIWWHIQERH
*MRERGMRKEGXMZMXMIWGSQTER]I\TIGXWXSHMWXVMFYXIGEWLHMZMHIRHWFSVVS[WLSVXXIVQPSERWERHMWWYI
YRWIGYVIHFSRHW

EXHIBIT 27
PAGE 499
Exhibit 28
EXHIBIT 28
PAGE 500
PEGATRON SPOKESPERSON
Name: Charles Lin
Title: Chief Financial Officer
Tel. 886(2) 8143-9001
E-mail: ir@pegatroncorp.com
DEPUTY SPOKESPERSON
Name: Ming-Chun Tsai
Title: Deputy Director of Corporate Information
Tel.: 886(2) 8143-9001
E-mail: ir@pegatroncorp.com
CORPORATE HEADQUARTERS
Address: 5F, 76, Ligong St., Beitou District, Taipei City
Tel. 886(2) 8143-9001
MANUFACTURING SITE
Address: No.5, Xingye St., Guishan Township, Taoyuan City
Tel.: 886(3) 319-6899
COMMON SHARE TRANSFER AGENT AND REGISTRAR

Name: Registrar & Transfer Agency Department of KGI Securrries Co. LTD.
Address: 5F, 2, Sec. 1, Chung-Ching South Road, Taipei City
Tel.: 886(2) 2389-2999 Website: https://www.kgieworld.oom.tw
AUDITORS
CPA Firm: KPMG
Name of CPA: Ulyos K.J. Maa and Charlotte WW Lin
Address: 68F, TAIPEI 101 TOWER, No. 7, Sec. 5, Xinyi Road, Taipei City
Tel.: 886(2) 8101-6666 E-mail: http://www.kpmg.oom.tw
OVERSEAS SECURITIES EXCHANGE

Luxemburg Stock Exchange: http://www.bourse.lu
FOR MORE INFORMATION ABOUT PEGATRON

http://www.pegatroncorp.com
EXHIBIT 28
PAGE 501
This English version of the Pegatron Annual Report is a concise translation of the
Mandarin version. This document is created for the sole purpose of the convenience for
its non-Mandarin readers and is not an official document to represent the financial
status of the Company per Taiwan laws.
Pegatron Corporation does not assure the accuracy of this translated document. Readers
wishing to view the official audited version of Pegatron 's financial reports can obtain a copy of
the Pegatron Annual Report (Mandarin version) on the Pegatron Corporation website
(www.pegatroncorp.com ).
EXHIBIT 28
PAGE 502
TABLE OF CONTENTS
1. Letter to Shareholders ..................................................................................................... 1
2. Company Profile ............................................................................................................... 3
2.1 Date of Incorporation .......................................................................................... 3
2.2 Company Milestones ........................................................................................... 3
3. Corporate Governance .................................................................................................... 5
3.1 Organization Structure........................................................................................ 5
3.2 Board of Directors and Management Team ..................................................... 8
3.3 Implementation of Corporate Governance ...................................................... 23
3.4 Information Regarding CPA Fees ..................................................................... 45
3.5 Information on Change of CPA ......................................................................... 46
3.6 Management Team Who Had Worked for the Independent Auditor ............. 46
3.7 Status of Net Change in Shareholding and Shares Pledged ......................... 46
3.8 The Relation of the Top Ten Shareholders ..................................................... 47
3.9 Long-Term Investment Ownership ................................................................... 47
4. Capital and Shares ......................................................................................................... 48
4.1 Capital and Shares ............................................................................................ 48
4.2 Issuance of Corporate Bond ..............................................................................55
4.3 Preferred Shares ................................................................................................55
4.4 Issuance of Global Depository Receipts ......................................................... 56
4.5 Employee Stock Option .................................................................................... 57
4.6 Employee Restricted Stocks .................................................................57
4.7 New Shares Issuance in Connection with Mergers and Acquisitions .......... 62
4.8 Financing Plan and Implementation ................................................................ 62
5. Overview of Business Operation .................................................................................. 63
5.1 Business Activities............................................................................................ 63
5.2 Market and Sales Overview .............................................................................. 71
5.3 Status of Employees ......................................................................................... 77
5.4 Expenditure on Environmental Protection ...................................................... 77
5.5 Employee Relations ........................................................................................... 78
5.6 Important Contracts .......................................................................................... 80
6. Financial Information ..................................................................................................... 81
6.1 Five-Vear Financial Summary.......................................................................... 81
6.2 Five-Vear Financial Analysis............................................................................ 89
6.3 Audit Committee's Review Report.................................................................. 97
6.4 Consolidated Financial Statements ............................................................... 98
6.5 Non-Consolidated Financial Statements........................................................ 98
6.6 Financial Difficulties ......................................................................................... 98
EXHIBIT 28
PAGE 503
7. Review of Financial Position, Management Performance and Risk Management... 99

7.1 Analysis of Financial Status ............................................................................. 99
7.2 Analysis of Operating Results ........................................................................ 100
7.3 Analysis of Cash Flow ..................................................................................... 101
7.4 Major Capital Expenditure ............................................................................... 101
7.5 Investment Policy............................................................................................. 101
7.6 Analysis of Risk Management.........................................................................101
7.7 Other Major Risks ............................................................................................. 105
8. Other Special Notes ..................................................................................................... 106
8.1 Affiliated Companies ........................................................................................106
8.2 Private Placement Securities .......................................................................... 111
8.3 The Shares of the Company Held or Disposed of by the Subsidiaries ....... 111
8.4 Special Notes.................................................................................................... 111
8.5 Events with Significant Impacts ..................................................................... 111
EXHIBIT 28
PAGE 504
(English Translation of Financial Report Originally Issued in Chinese)
PEGATRO'll CORPORATIO'll AND ITS SUBSIDIARll<:S
'llOTES TO CONSOLIDATED FI'llANCIAL STATK\1ENTS (CO'llT'D)
D. ()thcr incon1c an<l expenses fron1 Related Pa11ics

For the Years Ended December 31
2015 2014
Others $ 154
(3) Key management personnel compensation:

For the Years Ended December 31
2015 2014
Short-tenn employee benefits $ 602,068 543.857
Post-employment benefits 4,584 4,818
Share-based payn1cnts 169,745 40,022
$_ _ _ _ _ _1_16 ..,_39_7 _ _ _ _ _ _5_ss..,6_9_7
Please refer to Notes 6(21) and 6(22) for further explanations related to share-based payn1cnt
transru:tions.
8. Pledged Assets
As of Dcccn1bcr 31. 2015 and 2014, pledged assets \Vere as fol knvs:
December 31, Decem her 31,
~,\sset Purpose of pledge
2015 2014
Other financial asset (~usto1ns dut} guarantee, collateral, rental S 44,533 45,255
deposits, travel agency guarantee, etc.
:.Jon-current assets Bank loans 88,517
held-for-sale
Property, pl lint and Bll11k lolln~ 1,616,838 1.858.372
equipn1enL
Long-tenn prepaid Bank loans 12,333
rentals
Refundllble deposiLs (\1stoms duty guarantee. custon1 depo~its, 24,300 27.044
and deposits for petforn1ance guarantee
$___1.,1,.6R.,,.,-,,.6,.71" ___2,.,,.0..
3.,1,,.s.,2..
1
9. Significant Commitments And Contingencies
( l) Major commitlnents and contingencies \Vere as follo\vs:
A. Unused standby letters of credit

December 31, 2015 December 31, 2014
EUR $ 3.01 () 2.973
JPY 3,262.883 5,882,425
USD 7.211 30,633
13. Promissory notes and certificates of deposit obtained for business purpose \Vere as follo\vs:
NTD $ 6,689 11,997
216
EXHIBIT 28
PAGE 505
Pi<:GATRON CORPORATION AND ITS SUBSIDIARll<:S
NOTES TO CONSOLIDATED FI'llANCIAL STATK\1ENTS (CONT'D)
C. As of December 31, 2015 and 2014, the significant contracts for purchase of properties by
the Group amounted to Sl3.223,710 and S5,219,870. of which $6,258.950 and $2.894,149,
respectively, \Vere unpaid.
D. As of December 31, 2015 and 2014, the Group provided endorsement guarantee for bank
loans obtained by the related parties, including Group entities, amounting to $9,841.287 and
S 16,488,504, respectively.
E. As of December 31, 2015, the Group issued a tariff guarantee ofS276,l 75 to the bank for the
purpose of importing goods.
f. The board of directors of Ability (T\V) decided to build a new office building with its own
land on September 15, 2014. Constrnction will be provided by Ta Chen Construction &
Enginccting (\.HT). The whole contract price for this construction is S824,775.
(2) Significant contingent liability: None.
10. LOSSES DUE TO ~IAJOR DISASTERS: None.
11. SUBSEQUE'llT EVENTS:
In order to maintain the Company's credit standing and shareholders' equity, the Board of Directors
resolved to buy back 50,000 thousand shares of the Company during January 22 to March 21, 2016.
Prices for this repurchase ranged between $46.30 to $80.00 per share. Please refer to Market
Observation Post System for details.
12.0THER
The employee benefits, depreciation, depletion m1d mnortization expenses categorized by

function, \Vere as follo\vs:
For the ''{car Ended For the ''{car Ended
Dccc1nbcr 31,2015 Dccc1nbcr 31,:2014
Operating Operating Operating Operating
By iten1 Totlll Total
Cost cxocnsc Cost cxocnsc
En1ployee benefit
Salary $ 45,440,68, 16,965,510 62,406,l 94 37,138,08 13,614,362 50,752,449
Health and labor
4,951,812 1,049,772 6,001,584 3,337,938 818,849 4, 156,787
insurance
Pension 5,268,762 920,554 6, 189,316 3, 152,526 679,551 3,832,077
Others 2,270,572 874,115 3,144,687 1,851,880 666,358 2,518,238
Depreciation 12,164,759 1,295,37 l 13,460,130 l 1,717,766 1,833,947 13,551,713
AinorLizlltion 30,094 193.385 223.479 29,509 170.813 200,322
.A..bovc depreciations <lid not include depreciation in invcstn1L11t property which \Vas accounted
under non-operating expense as fol knvs:
For the Years i<:nded December 31
2015 2014
Depreciation in investment property $
-------- 11,270 10,379
217
EXHIBIT 28
PAGE 506
(English Translation of Financial Report Originall~1 Issued in Chinese)
PEGATRON CORPORATIO~ A~D ITS SlJBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONT'D)
13. SEG\'IENT l~FORMATION
( 1) G<.rn;ral lnfomiation
The Group's operating scgm<.11ts required to be disdoscd arc catcgori;>;c;d as OMS (Design,
Manufacturing and Service) and Strategic Investment Group. DMS's main operating activities
arc designing and manufacturing computer, communication and consumer electronics' <.11d
products, and providing aftcr-saks service. Strategic Investment Group is OMS' s upsti-cam and
do\vnstream supply chain, strategic investments and other related investments anns. The chief
operating decision maker's main responsibility is to integrate strategy that creates operating
synergy throughout the supply chain and to allocate the profit from the operating result. The
Group assesses performance of the segments based on the segments' profit, and report the
amounts of revenues based on the financial infonnation used to prepare the consolidated
financial statements.
(2) Reportable segment profit or loss, segment assets, segment liabilities, and their mcasur<.111<.11t cu1d
rccondliations
The Group uses the internal management report that the chief operating decision maker reviews
as the basis to determine resource allocation and make a performance cval uation. The internal
management rcp011 indudcs profit before taxation, cxduding any extraordinary activity and
forcib'll exchange gain or losses, because taxation, cxtrnordinary activity and forcib'll exchange
gain or losses are managed on a group basis, and hence they are not able to be allocated to each
reportable segment. In addition, not all reportable segments include depreciation and
amortization of significant non-cash items. The reportable a.mount is similar to that in the report
used by the chief operating decision maker.
The operating SCb'111cnt accounting policies arc similar to the ones dcsc1ibcd in Note 4
"si1:,'1lificant accounting policies" except for the recognition cu1d measurement of pension cost,
which is on a cash basis. The Group treated intcrscgmcnt sales and trnnsfixs as third-pai1y
transactions. They arc measured at market pticc.
218
EXHIBIT 28
PAGE 507
PEGATRON CORPORATION AND ITS SUBSIDIARIES
'llOTES TO CO'llSOLIDATED FINA'llCIAL STATEMENTS (CONT'D)
The (Jroup's operating scgrncnt infon11ation and reconciliation were as follo\vs:

Strategic A.djustment
For the Year Investment and
Ended December 31, 2015 DMS Groul! eliminations Total
Revenue:
Revenue from exLenu1l custo1ners s 1,114,266,543 99,446,433 1,213,712,976
lnLersegn1ent revenues 2,580,781 7243,274 (9,824,055)
T oLal revenue $ 1,116,84 7,324 106,689,707 (9,824,055) 1,213, 712,976
Share of profit of associates and
joint ventures accounted for using
equity 1neLhod $ 4,838,315 10,092,787 (14,943,956) (12,854)
Other significant non-n1011etary
itcn1s:
Goodvvill $ 111471923 164 859 113121782
Reportahle segment profit or loss $ 30,324,630 23,808,056 (14,949,672) 39,183,014
A~seLs:
Tnvestn1ents accounted for using
$ 47,585,206 89,508,143 (136,669,158) 424,191
equity n1ethod
Reportable segment assets $ 392,071,442 220,643,421 (136,628,200) 4 76,086,663
Reportable segn1ent liabilities $ 241,691,277 42,180,763 (123,902) 283, 748,138
For the Year

Ended December 31, 2014
Revenue:
Revenue fro1n external euston1ers s 922,718,932 97,019,901 1,019,738,833
Interseginent revenues 1,567605 13,604,269 (15,171,874)
Total revenue $ 924,286,537 110,6241170 !151111 1874! 1,019, 7381833
Shllre of profiL of associllte~ and
joint ventures accounted for using
equity nicthod $ 4 145,662 10,561,052 1151021,037) (320,323j
Other ~ignificm1t non-111onetllry
iten1s:
Goodwill $ 1,106,886 164,860 1,271, 746
Reportable segn1ent profit or loss $ 18,894,004 22,389,431 (15,021,348) 26,262,087
Assets:
Investn1cnts accounted for using
$ 47,572,890 82,269,314 (129,351,832) 490,372
equiLy 111ethod
Reportahle segment assets $ 373,500,846 212,802,987 (129,210,692) 457,093, 141
Reportable segment liabilities $ 239,829,916 42,415,715 (23,720) 282,221,911
219
EXHIBIT 28
PAGE 508
(i<:nglish Translation of Financial Report Originally Issued in Chinese)
Pl<:GATRON CORPORATION A'llD ITS SlJBSIDIARll<:S
NOTES TO CONSOLIDATED FINANCIAL STATEME'llTS (CONT'D)
(3) Geographic information

In presenting intOr1nation on the basis of geography~ segment revenue is based on the
geographical location of custon1crs and SC.!::,T111cnt assets arc based on the gcOb'Taphical location of
the assets.
A. External Sales
Region 2015 2014
Europe s 510.430.274 316,907,114
USA 273.135,851 301.753,238
Tai"'an 185.605.468 224,249,202
China 100.602.388 55.944.888
Japan 81,751.727 61,244.411
Others 62,187,268 59.639,980
Total 1,213,712,976 1,019,738,833
B. Non-current assets
Region December 31, 2015 December 31, 2014

Tai"'an s 21,546,353 19,067,524
China 57,097,050 60, 116,829
Others 1,018,603 1,100,357
Total $
--------
Non-current assets include property) plant and
79,662,006
equip1nent~ investment
80,284,710
property~ intangible
assets~ and other non-current assets, excluding financial instnnnents~ deterred tax assets~
pension fund assets~ m1d rights arising tfo1n an insurm1ce contract (non-current).
(4) Mai or Customer
Major customers from DMS in 2015 and 2014 were as follows:

c:ustomer 2015 2014
A s 729,205.460 521,007,973
B 122,375.001 120,950.470
c 61,848,011 42.051.907
$ 913,428,472 684,0 I 0,350
220
EXHIBIT 28
PAGE 509
Attachment II
PEGATRON CORPORATION
NON-CONSOLIDATED FINANCIAL STATE1\1ENTS
DECEMBER 31, 2015AND 2014
(With Independent Accountants' Audit Report Thereon)
221
EXHIBIT 28
PAGE 510
AUDIT REPORT 01'' ll\DJ<.:PlND1NT ACCOLJ.Yl'A.Yl'S
To the Board of Directors of

Pegatron Corporation
\Ve have audited the accompanyi11g balm1ce sheets of Pegatron Corporation (the "Company"') as of
December 31, 2015 and 2014. and Lhe related statements of comprehensive income. changes in
ettuity and cash flows for the years then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on Lhcse financial statements
based on our audits. Vle did not audit t11e financial statemellts of certain investees accounted for tmder
the equity metl1od, i11 which the Company's long-tenn equity investments represented 4.38% and 5.14%
of total assets as of December 31, 2015 and 2014, respectively, and related share of profit or loss of
subsidiaries, associaLcs and joint ventures accounted for under equity method represented 4.32% and
6.51 % ofprofi.L before Lax for the years ended December 31, 2015 and 2014, rcspccLivcly. The financial
stateme11ts of these investees were audited by other auditors wl1ose reports have been furnisl1ed to us,
and our opinion, insofar as it relates to the amounts for these investees, is based solely on the reports of
other auditors.
We conducted our audits in accordance with "RegulaLion Governing Auditing and Cenifi.cation or
Fi11ancial Statements by Certified Public Accountants"' ai1d auditing standards generally accepted in t11e
Republic or China. Those regulations and standards require thaL we plan and perform Lhc audit to obtain
reasonable assurance about whether the non-consolidated financial statements are free of material
misstatements. An audit includes examining, on a LesL basis, evidences supporting the amoums and
disclosures in the non-consolidated financial statements. An audit also includes assessing the
accounting p1inciples used mid significant estimates made by management, as well as evaluating t11e
overall non-consolidated financial statement presentation. \Ve believe that our audits and the reports
issued by oLher auditors provide a reasonable basis for our opinion.
222
EXHIBIT 28
PAGE 511
Jn our opinion. based on our audits and the reports of other auditors. the accon1panylng financial
staten1ents refe1Ted to above present thirly. in all niaterial respects, the financial position of the
Company as of December 31, 2015 and 2014i the results of its operations and its cash flo-..vs for the years
then en<led in conformiLy \Vith the RegulaLions Governing Lhe Prepardtion of Financial Reports by
Securities Issuers.
CPA Ulyos Maa

Securities and Fun1res Comn1ission,
Ministry of Finance, R.O.C~. regulation
(88)Tai-Tsai-Jung(6)No_ 18311
March 17, 2016
Note to Readers
The accon1panying non-consolidated financial slalen1enls are intended only lo present the financial position, results of
operations and ca~h flow~ in accordance \\1ith Regulation~ <Tovcrning the Preparation of Financial Report~ by Securitic~ Issuer~.
in the Republic of China and not those of any other jurisdictions. The standard~, procedure~ and practices to audit 'filch financial
slalements are Lhose generally accepted and applied in Lhe Republic of China.
For the convenience of readers, the accountant~' report and the accompanying non-consolidated financial statement~ have hccn
translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict
bet\veen the English version and the original Chinese version or any difference in the interpretation of the r.vo versions, the
Chinese-language accountants' report and financial slalements shall prevail.
223
EXHIBIT 28
PAGE 512
(English Translation of Financial Report Originally Issued in (~hinese)

PEGATRON CORPORATION
NON-CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2015 AND 2014
(A.ll Amounts Expressed in Thousands of Ne"' Tai""'an Dollars)
llecember 31, 2015 llecember 31, 2014

0, 0,
Amount /o .<\mount /o
ASSETS
Current Assets:
Cash llnd Clish equivlllent~ (Note 6(1)) $ 31.919,719 7 31.092,242 7
Financial assets at fair value through profit or loss
288,068
current ('lotc 6(2))
Accounts receivable, net (\fote 6(3 )) 86,443,966 20 I 03, 145,200 24
AccoUI1ts receivable, net- Related parties (:.Jotc 7) 148,231,4 75 34 150,393,887 35
Other receivables, net (Notes 6(3) and 7) 23,581,706 5 12,895,589 3
Tnventories (\rote 6(4)) 26,965,535 6 18,350,385 4
Other f111llncial llSset~-cu1TenL (Nole 6(8)) 41,390 42,141
Other current assets (:.;rote 6(8)) 131,683 136,624
317,603,542 72 316,056,068 73
Non-current assets:
Invest111ents accounted for using equity 111cthod (Note 6(5)) l l 7 ,840,66 l 27 112,093,393 26
Property, planL llnd equipment, net (:>lote~ 6(6) llnd 7) 4,423,894 4,478,327
hllangible aels ('lote 6(7)) 67,576 48,713
Defe1Ted Lax a~~ets (:>!ote 6( 15)) 291,160 180,305
Other financial assets noncurrent (Note 6(8)) 30,419 26,684
Other noncurrent assets (Note 6(8)) 11,439
122,665, 149 28 116,827,422 27
TOTAL ASSETS $ 440,268,691

- 100 432,883,490
- 100
The accompanying notes are an integral part of the non-consolidated financial statments.
224
EXHIBIT 28
PAGE 513
Exhibit 29
EXHIBIT 29
PAGE 514
1. Name, Title and Contact Information for Companys Spokesperson

Spokesperson Stone Shih
Title Controller
Tel 886-2-6616-9999
E-mail spokesperson@wistron.com
Acting Spokesperson Mike Liang

Title Executive Director of PR/Investor Relation
and Treasury Management Division
Tel 886-2-6616-9999
E-mail spokesperson@wistron.com
2. Address and Telephone Number of Companys Registered Office and Headquarters
Office Address Tel
Wistron Corp. 5, Hsin An Rd., Hsinchu Science Park, Hsin- 886-3-577-0707
(Registered office) chu 300, Taiwan, R.O.C.
Wistron Corp. 158, Singshan Rd., Neihu, Taipei, 11469, 886-2-6616-9999

(Headquarters) Taiwan, R.O.C.
Wistron Corp. 21F., No88, Sec.1 ,Hsintai 5th Rd., Hsichih, 886-2-6616-9999
(Headquarters) New Taipei City 22181, Taiwan, R.O.C.
3. The Address and Contact information for Wistron Shareholders Services Office
Address 158, Singshan Rd., Neihu, Taipei, 11469, Taiwan, R.O.C.
Tel 886-2-6600-7998
E-mail stock@wistron.com
4. The Address and Contact information of Auditing CPA in 2016

Name Ya-Ling, Chen and Li-Li, Lu at KPMG
Address 68F, TAIPEI 101 TOWER, No.7, Sec.5, Xinyi Road, Taipei, 110,
Taiwan, R.O.C.
Tel 886-2-8101-6666
Website www.kpmg.com.tw
5. For more information about Wistron: www.wistron.com

6. For more information about Wistron GDRs:
http://www.bourse.l
http://www.LondonStockExchange.com
This English version Annual Report is a summary translation of the Chinese version Wistron Annual Report. This
document is created for the sole purpose of the convenience of its readers and is not an official document to represent
the financial position of the company per Taiwan laws.
Wistron Corporation does not guarantee the accuracy of this translated document. Readers wishing to view the official
audited version of Wistrons financial reports can obtain a copy of the Wistron Annual Report (Chinese version) on the
Wistron Corporation website (www.wistron.com).
EXHIBIT 29
PAGE 515
Wistron Corporation 2016 Annual Report translation
INDEX
1. Letter to Shareholders...... 04
2. Company Introduction
2.1 Quick facts...... 08
2.2 Business summary...... 08
2.3 Public listing...... 09
2.4 Milestones...... 10
2.5 Organization Structure..... 20
2.6 Products...... 23
2.7 Services...... 24
2.8 Long-Term and Short-Term Business Development Plans 26
2.9 Market, Production and Sales . 28
2.10 Board of Directors, Supervisors and Key Managers background information 34
2.11 Information related to the compensations for directors, president and vice president 48
2.12 Labor Relations.... 49
3. Operational Highlights
3.1 Key Accounts in the Past Two Years. 52
3.2 Production Value in the Most Recent Two Years. 53
3.3 The Sales Value in the Most Recent Two Years. 53
3.4 Taiwan Employee Data during the Past Two Years. 53
3.5 Environmental Protection Measures. 54
3.6 Corporate sustainability and social responsibility. 56
4. Company Shares and Fund Raising
4.1 Capital and Shares. 60
4.2 Issuance of Corporate Bonds 67
4.3 GDR Issuance 67
4.4 Employee Stock Options 67
4.5 Implementation of the Companys Fund Raising and Utilization 67
EXHIBIT 29
PAGE 516
Wistron Corporation 2016 Annual Report translation
5. Financial Standing
5.1 Most Recent 5-Year Concise Financial Information 70
5.2 Most Recent 5-Year Financial Analysis 74
5.3 Audit Committee's Review Report 78
6. Financial Analysis
6.1 2016 vs. 2015 financial analysis 82
6.2 2016 vs. 2015 operating result analysis 83
6.3 Cash flow analysis 84
6.4 Major Capital Expenditures and Impact on Financial and Business 84
6.5 Investment Policies 85
6.6 Risk Management 85
7. Enforcement of Corporate Governance 90
8. Enforcement of Ethical Corporate Management 98
9. Enforcement of Social Responsibility 104
10. Financial Statements Consolidated With Subsidiaries Audited by CPA of 2016 F-1
10.1 Independent auditors report of the consolidated financial statements of
Wistron Corporation for the years ended December 31, 2016 F-2
10.2 Audited consolidated financial statements of Wistron Corporation as of and
for the years ended December 31, 2016 F-6
EXHIBIT 29
PAGE 517
F-76 Wistron Corporation 2016 Annual Report translation
10 WISTRON CORPORATION AND ITS SUBSIDIARIES

Financial Statements Consolidated With Subsidiaries Audited by CPA of 2016
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The Groups debt ratio as of December 31, 2016 and 2015, were as follows:
December 31, December 31,

2016 2015
Total liabilities $ 214,787,109 221,167,831
Total assets $ 282,755,558 290,385,044
Debt ratio 76% 76%
As of December 31, 2016, the Groups capital management strategy is consistent with the prior year.
(7) Related-party transactions:
(a) Parent company and ultimate controlling party
The Company is the ultimate controlling party of the Group.
(b) Related party transactions
(i) Sales
The amounts of significant sales transactions and outstanding balances between the Group and
related parties were as follows:
Sales Receivables from related parties

2016 2015 2016 2015
Associates $ 1,956,289 5,193,120 5,769 520,060
The selling price and payment terms of sales to related parties depend on the economic
environment and market competition, and are not significantly different from those with third-
party customers.
(ii) Purchases
The amounts of significant purchase transactions and outstanding balances between the Group
and related parties were as follows:
Purchases Payables to related parties

2016 2015 2016 2015
Associates $ 4,701,229 8,806,561 1,186,708 2,093,958
Trading terms of purchase transactions with related parties are not significantly different from
those with third-party vendors.
(Continued)
EXHIBIT 29
PAGE 518
Wistron Corporation 2016 Annual Report translation F-77
WISTRON CORPORATION AND ITS SUBSIDIARIES 10

(iii) Other income and others
Other receivables from

Amount related parties
2016 2015 2016 2015
Associates:
Rental income $ 11,265 7,109 355 9
Property transactions 679 8,041 137 144
$ 11,944 15,150 492 153
(iv) Operating expense and others
Amount Other payables to related parties

2016 2015 2016 2015
Associates:
Property transactions $ 47,610 115,739 31,069 58,631
Other related parties:
Contribution 2,668 4,907 - -
$ 50,278 120,646 31,069 58,631
(v) Advances to related parties
The Group paid certain expenses on behalf of related parties including purchase, warranty
expense, repair expense and other disbursement were as follows:
Other receivables from related parties

Associates $ 4,186 15,562
(vi) Advances from related parties
Related parties paid certain expenses on behalf of the Group, including warranty expenses,
traveling expenses, and salaries for overseas employees were as follows:
Other payables to related parties

Associates $ 12,185 7,470
(Continued)
EXHIBIT 29
PAGE 519

(vii) Receivables from related parties resulting from the above transactions were as follows:

2016 2015
Receivables from related parties:
Notes and accounts receivable $ 5,769 520,060
Other receivable-related parties:
Rental receivable $ 355 9
Receivable from sale of property, plant and
equipment 137 144
Other receivables 4,186 15,562
$ 4,678 15,715
(viii) Payables to related parties resulting from the above transactions were as follows:

2016 2015
Payables to related parties:
Notes and accounts payable $ 1,186,708 2,093,958
Other payables-related parties:
Payable to purchase of property, plant and
equipment $ 31,069 58,631
Other payables 12,185 7,470
$ 43,254 66,101
(c) Transactions with key management personnel
Key management personnel compensation:
2016 2015
Short-term employee benefits $ 57,586 54,752
Post-employment benefits 1,181 1,145
$ 58,767 55,897
(Continued)
EXHIBIT 29
PAGE 520

(8) Pledged assets:
The carrying values of pledged assets are as follow:

Pledged assets Object 2016 2015
Property, plant and equipment- Bank loan
lands and buildings $ 333,080 332,461
Other non-current assets -restricted Stand by L/C
bank deposit 9,434 9,524
Other non-current assets -restricted Foreign exchange guarantee
bank deposit 325,745 -
Other non-current assets -restricted Custom guarantee
bank deposit 6,456 6,613
Other non-current assets -restricted Performance guarantee
bank deposit - 10,502
Other non-current assets -restricted Litigation guarantee
bank deposit 980 499
Other current assets -restricted bank Bank loan
deposit - 24,697
$ 675,695 384,296
(9) Commitments and contingencies:
As of December 31, 2016 and 2015, the unused letters of credit were as follows:

Unused letters of credit $ 90,566 43,648
(10) Losses Due to Major Disasters: None.
(11) Subsequent Events:
The appropriation of earnings for 2016 that was approved at the board of directors meeting on March 20,
2017 were as follows:
2016
Cash dividends $ 3,042,169
Stock dividends 760,542
Total $ 3,802,711
The appropriation of earnings for 2016 are to be presented for approval in the shareholders' meeting to be
held in June.
(Continued)
EXHIBIT 29
PAGE 521

(12) Other:
Total personnel, depreciation and amortization expenses categorized by function for the years ended
December 31, 2016 and 2015 were as follows:
2016 2015
Cost of Operating Cost of Operating
sales expenses Total sales expenses Total
Personnel expenses
Salaries 13,705,128 9,998,975 23,704,103 14,701,406 9,818,310 24,519,716
Labor and health insurance 1,645,473 915,500 2,560,973 1,797,725 960,877 2,758,602
Pension 70,681 406,080 476,761 67,805 386,528 454,333
Others 1,561,656 586,167 2,147,823 1,250,985 592,278 1,843,263
Depreciation 5,695,887 1,961,527 7,657,414 5,600,837 2,241,379 7,842,216
Amortization 8,044 384,063 392,107 9,304 423,702 433,006
The Group had 83,278 and 60,681 employees, respectively, as of December 31, 2016 and 2015.
(13) Segment information:
(a) General information
The major activities of the Group are the design, manufacture and sale of information technology
products. The chief operating decision maker of the Group determines each business group as an
operating segment. According to the provisions of the accounting standard, only the Research and
Manufacturing Service Department qualifies under the quantitative threshold criteria as a reportable
segment. Other operating departments are deemed immaterial and need not be disclosed as reportable
segment including the client service group and the related new business investment. The performance
of the department is evaluated based on the operating profit of the Group.
(b) Profit or loss data of the reporting segment (including specific revenues and expenses), assets and
liabilities of the segment, the basis of measurement, and the related eliminations:
No tax expenses or non-operating income and expenses are allocated to the reporting segment. In
addition, the reporting segment does not include depreciation and amortization of significant non-
cash items. The reportable amount is similar to that in the report used by the chief operating decision
maker. The accounting policies of the operating segments are the same as those described in note 4.
The Group evaluates the performance of operating segment on the basis of operating income. The
Group treats intersegment sales and transfers as third-party transactions. They are measured at market
price.
(Continued)
EXHIBIT 29
PAGE 522

The Groups operating segment information and reconciliation are as follows:

2016
R&D and
Manufacturing Others Eliminations Total
Revenues from external customers $ 566,277,457 93,630,774 - 659,908,231
Segment revenues 5,390,073 1,587,130 (6,977,203) -
Total revenues $ 571,667,530 95,217,904 (6,977,203) 659,908,231
Segment profit $ 4,712,175 1,299,895 (1,254,970) 4,757,100
Accounts receivable $ 67,769,096 21,958,386 89,727,482
Inventories 54,568,215 10,648,064 65,216,279
Segment identifiable assets $ 122,337,311 32,606,450 154,943,761
General assets 127,811,797
Total assets $ 282,755,558
Accounts payable $ 108,596,596 14,438,629 123,035,225
Segment identifiable liabilities $ 108,596,596 14,438,629 123,035,225
General liabilities 91,751,884
Total liabilities $ 214,787,109
2015
R&D and
Manufacturing Others Eliminations Total
Revenues from external customers $ 504,428,441 118,845,547 - 623,273,988
Segment revenues 6,430,395 2,588,390 (9,018,785) -
Total revenues $ 510,858,836 121,433,937 (9,018,785) 623,273,988
Segment profit $ 3,074,413 (684,708) (19,340) 2,370,365
Accounts receivable $ 64,044,463 26,896,203 90,940,666
Inventories 50,976,999 16,633,878 67,610,877
Segment identifiable assets $ 115,021,462 43,530,081 158,551,543
General assets 131,833,501
Total assets $ 290,385,044
Accounts payable $ 78,682,911 20,526,408 99,209,319
Segment identifiable liabilities $ 78,682,911 20,526,408 99,209,319
General liabilities 121,958,512
Total liabilities $ 221,167,831
(c) Information about the products and services
Information about the Groups revenue from external customers was as follows:
2016 2015
Computer, Communication & Consumer electronics $ 566,277,457 504,428,441
Others 93,630,774 118,845,547
$ 659,908,231 623,273,988
(Continued)
EXHIBIT 29
PAGE 523
10
WISTRON CORPORATION AND ITS SUBSIDIARIES
(d) Geographical information
In presenting information on the basis of geography, segment revenue is based on the geographical
location of customers and segment assets that are based on the geographical location of the assets.
Revenue from external customers:
Geography 2016 2015

Taiwan $ 430,060,296 390,606,074
Asia 149,968,370 147,565,212
Others 79,879,565 85,102,702
$ 659,908,231 623,273,988
Non-current assets:

Geography 2016 2015
Taiwan $ 6,831,243 7,888,402
Asia 31,648,395 30,674,151
Others 2,796,225 3,586,083
$ 41,275,863 42,148,636
Non-current assets include the property, plant and equipment, intangible assets and other non-current
assets, aside from the financial instruments, deferred tax assets and goodwill.
(e) Information about revenue from major customers
For the years ended December 31, 2016 and 2015, the amounts of sales to customers representing
greater than 10% of net revenue were as follows:
2016 2015
Percentage of Percentage of
Customer Net revenue net revenue Net revenue net revenue
Customer H $ 133,893,200 20 157,977,795 25
Customer B 91,309,525 14 103,461,741 17
Customer G 83,087,174 13 40,234,977 6
Customer F 68,719,028 10 80,761,873 13
EXHIBIT 29
PAGE 524
EXHIBIT 29
PAGE 525
Exhibit 30
Leading multinationals from Taiwan increase their foreign

assets despite the global crisis
Report dated November 3, 2011
EMBARGO: The contents of this report must not be quoted or summarized in the print,
broadcast or electronic media before 10:00 a.m. Taipei and 2 a.m. GMT on November 3,
2011, and 10:00 p.m. New York on November 2, 2011.
Taipei and New York, November 3, 2011:
The College of Management at Fu Jen Catholic University in Taipei, and the Vale Columbia
Center on Sustainable International Investment (VCC) at Columbia University in New York, are
releasing the first annual report on leading Taiwanese multinationals today, indicating that the
top Taiwanese multinationals are maintaining their growth momentum in their investment abroad
despite the global crisis and a drop in the overall flows of Taiwanese foreign direct investment
(FDI). The research for this report was conducted in 2011 and covers the period 2007 to 2009.1
Highlights
The global financial crisis had a severe negative impact on Taiwans outward investment in 2009.
According to UNCTAD, the FDI outflows of Taiwan dropped dramatically from USD 10.29 billion
in 2008 to USD 5.87 billion in 20092. However, 15 of the top 20 Taiwanese multinationals still
increased their overseas assets in 2009 (table 3 below).
The top 20 Taiwanese multinationals ranked in table 1 below by their foreign assets had around
USD 76 billion in overseas assets, USD 221 billion in foreign sales and employed nearly 1.1 million
persons abroad in 2009 ( see annex table 1 for details other than assets). The total foreign
assets of the 20 multinationals were equivalent to more than 40% of Taiwans outward FDI
stock of around USD 180 billion in 2009. Collectively, the top 20 had 1,164 foreign affiliates in
42 economies. The most prominent industry on the list is electrical and electronic equipment
manufacturing.
1
The research for this report was carried out by Anthony Kuo and Ming-Sung Kao, in association with the College of
Management, Fu Jen Catholic University. The authors would like to thank Professor Yi-Chieh Chang of the Department
of Business Administration at St. John's University, Taipei Campus, for his kind sharing of his data with us. A report on
2010 is expected later this year or next year.
2
UNCTAD, Annex tables to World Investment Report 2010, http://www.unctad.org/Templates/Page.asp?intItemID=55
45&lang=1.
Page 1 of 29
EXHIBIT 30
PAGE 526
Table 1. Taiwan: The top 20 non-financial outward investors, 2009a (USD million)
Status
Foreign
Rank Name of company Industry (% of state
assetsc
ownership)b
1 Hon Hai Precision Ind. Co., Ltd. Electrical and electronic equipment Listed (1.62%) 10,699
d
2 Pou Chen Corporation Consumer goods Listed (3.75%) 6,694
3 Asustek Computer Inc. Electrical and electronic equipment Listed (1.11%) 6,416
4 Quanta Computer Inc. Electrical and electronic equipment Listed (1.87%) 5,524
5 Acer Inc. Electrical and electronic equipment Listed (6.56%) 4,897
6 AU Optronics Corp. Electrical and electronic equipment Listed (2.11%) 4,874
7 Wistron Corp. Electrical and electronic equipment Listed (8.82%) 4,667
8 Taiwan Semiconductor Mfg. Co., Ltd. Electrical and electronic equipment Listed (6.73%) 3,661
9 Compal Electronics, Inc. Electrical and electronic equipment Listed (2.16%) 3,458
10 Nan Ya Plastics Corp. Plastics Listed (0.04%) 3,435
11 Delta Electronics, Inc. Electrical and electronic equipment Listed (3.03%) 3,212
12 United Microelectronics Corp. Electrical and electronic equipment Listed (0.65%) 2,591
13 Formosa Chemicals & Fiber Corp. Plastics Listed (0.03%) 2,587
14 Inventec Corporation Electrical and electronic equipment Listed (0%) 2,399
15 Cheng Shin Rubber Ind. Co., Ltd. Rubber and plastics products Listed (2.16%) 2,337
16 Formosa Plastics Corp. Plastics Listed (0.17%) 2,183
17 Yang Ming Marine Transport Corp. Shipping and related services Listed (36.3%) 1,847
18 Synnex Technology International Corp. Electronic products distribution Listed (1.6%) 1,708
19 Far Eastern New Century Corporation Textiles Listed (2.93%) 1,632
20 Qisda Corp. Electrical and electronic equipment Listed (0.25%) 1,323
Total 76,144
Source: Fu Jen-VCC research on leading Taiwanese multinationals, 2009, drawing on the Market Observation Post
System (MOPS) maintained by the Taiwan Stock Exchange (http://emops.twse.com.tw/), the Taiwan Economic Journal
(TEJ) database, and individual firms reports.
a
Financial firms are excluded by the methodology of the international project of which this report is a part. All data
are based on the firms annual reports. For additional data on each firm, see annex I, table 1 and the tables that
follow.
b
The percentage of state ownership shown in parentheses is based on 2009 data.
c
Foreign assets were calculated from the consolidated annual reports of individual firms. Calculations use the
exchange rate provided by the IMF for December 31, 2009: of USD 1 = TWD 31.98.
d
Mainly footwear and sportswear.
Profile of the top 20
Major drivers
The search for new production sites with lower production costs (mainly labor and land costs) or
higher economies of scale was the most important driver for Taiwanese investment abroad.
Accessing markets with high potential and expanding distribution channels were also crucial
determinants for certain firms. Responding to client requirements and following the migration
Page 2 of 29
EXHIBIT 30
PAGE 527
Annex table 1. Taiwan: The top 20 multinationals: Key variables, 2009 (USD million and number of employees) a
Rank by Assets Sales Employment Number of Number of

foreign Firm TNI (%) foreign host
assets Foreign Total Foreign Total Foreign Total affiliates economies
1 Hon Hai Precision 10,699 32,036 60,955 61,416 513,240 611,000 72% 314 27
2 Pou Chen 6,694 7,703 6,375 6,471 219,551 332,653 84% 39 6
3 Asustek Computer 6,416 11,599 18,377 19,126 69,128 113,324 71% 142 36
4 Quanta Computer 5,524 11,831 24,456 26,326 21,357 64,719 58% 50 12
5 Acer 4,897 9,123 17,406 17,993 5,564 6,624 78% 139 42
6 AU Optronics 4,874 19,518 10,988 11,264 38,277 51,378 66% 26 13
7 Wistron 4,667 5,637 13,939 17,137 21,974 39,239 73% 43 13
8 Taiwan Semiconductor Mfg. Co. 3,661 18,643 5,103 9,271 2,484 26,390 28% 24 11
9 Compal Electronics 3,458 10,511 21,027 21,169 33,655 58,025 63% 56 15
10 Nan Ya Plastics 3,435 13,276 4,016 7,653 18,454 30,297 46% 38 5
11 Delta Electronics 3,212 4,198 3,624 3,935 44,544 58,000 82% 37 11
12 United Microelectronics Corp. 2,591 7,951 1,771 2,865 5,742 13,051 46% 18 11
13 Formosa Chemicals & Fiber 2,587 14,019 4,016 9,291 10,941 17,936 41% 18 6
14 Inventec 2,399 4,549 11,119 13,951 28,164 29,646 76% 21 10
15 Cheng Shin Rubber 2,337 2,829 2,484 2,649 14,221 23,348 79% 23 10
16 Formosa Plastics 2,183 10,381 2,521 5,645 3,362 5,519 42% 10 7
17 Yang Ming Marine Transport 1,847 3,568 2,787 2,787 729 4,197 56% 46 20
18 Synnex Technology International 1,708 2,306 5,678 6,919 3,987 5,192 78% 24 10
19 Far Eastern New Century 1,632 8,383 2,521 5,186 15,125 20,834 47% 32 8
20 Qisda 1,323 3,485 2,021 4,707 20,552 41,942 43% 64 26
Total (average for percentages) 76,144 201,545 221,184 255,761 1,091,050 1,553,314 61% 1,164
Source: Fu Jen-VCC research on leading Taiwanese multinationals, 2009, drawing on the Market Observation Post System (MOPS) maintained by the Taiwan Stock Exchange
(http://emops.twse.com.tw/), the Taiwan Economic Journal (TEJ) database, and individual firms reports.
a
All calculations use the exchange rate provided by the IMF for December 31, 2009: USD 1 = TWD 31.98. b As indicated earlier, foreign employment figures were mostly unavailable from individual
firms annual reports. Approximations based on the percentage of foreign employment reported by UNCTAD in its World Investment Report 2009 or data from the Investment Commission in the
Ministry of Economic Affairs have been used instead. c The TNI for all firms other than Taiwan Semiconductor was calculated on the basis of the approximate employment ratio mentioned in the
preceding footnote.
Page 15 of 29
EXHIBIT 30
PAGE 528
Annex table 1a. Taiwan: The top 20 multinationals: foreign/total ratios, 2009
Rank by foreign Foreign asset/total Foreign sales/total Foreign employment

Firm Industry TNI (%)
assets asset sales /total employment
1 Hon Hai Precision Electrical and electronic equipment 33% 99% 84% 72%
2 Pou Chen Consumer goods 87% 99% 66% 84%
3 Asustek Computer Electrical and electronic equipment 55% 96% 61% 71%
4 Quanta Computer Electrical and electronic equipment 47% 93% 33% 58%
5 Acer Electrical and electronic equipment 54% 97% 84% 78%
6 AU Optronics Electrical and electronic equipment 25% 98% 75% 66%
7 Wistron Electrical and electronic equipment 83% 81% 56% 73%
8 Taiwan Semiconductor Mfg. Co. Electrical and electronic equipment 20% 55% 9% 28%
9 Compal Electronics Electrical and electronic equipment 33% 99% 58% 63%
10 Nan Ya Plastics Plastics 26% 52% 61% 46%
11 Delta Electronics Electrical and electronic equipment 77% 92% 77% 82%
12 United Microelectronics Corp. Electrical and electronic equipment 33% 62% 44% 46%
13 Formosa Chemicals & Fiber Plastics 18% 43% 61% 41%
14 Inventec Electrical and electronic equipment 53% 80% 95% 76%
15 Cheng Shin Rubber Rubber and plastics products 83% 94% 61% 79%
16 Formosa Plastics Plastics 21% 45% 61% 42%
17 Yang Ming Marine Transport Shipping and transportation 52% 100% 17% 56%
18 Synnex Technology International Electrical and electronic equipment 74% 82% 77% 78%
19 Far Eastern New Century Textiles 19% 49% 73% 47%
20 Qisda Electrical and electronic equipment 38% 43% 49% 43%
Page 16 of 29
EXHIBIT 30
PAGE 529
Annex table 2. Taiwan: The top 20 multinationals: Regionality Indexa (%) 2009
Developed
Asia-
Middle Eastern Latin
Rank by Sub- East Asia Pacific
East & South Europe & Other America & North Number of
foreign Firm Saharan & the (Japan,
North Asia Central Europe the America affiliates
assets Africa Pacific Australia
Africa Asia Caribbean
& New
Zealand)
1 Hon Hai Precision Ind. Co., Ltd. 0.0% 0.0% 43.9% 1.3% 1.3% 3.5% 2.2% 38.5% 9.2% 314
2 Pou Chen Corporation 0.0% 0.0% 46.2% 0.0% 0.0% 0.0% 0.0% 51.3% 2.6% 39
3 Asustek Computer Inc. 1.4% 2.1% 43.0% 0.7% 2.1% 3.5% 8.5% 31.7% 7.0% 142
4 Quanta Computer Inc. 0.0% 2.0% 48.0% 0.0% 2.0% 0.0% 4.0% 22.0% 22.0% 50
5 Acer Inc. 0.0% 1.4% 23.7% 0.0% 5.8% 3.6% 33.8% 16.5% 15.1% 139
6 AU Optronics Corp. 0.0% 0.0% 57.7% 0.0% 15.4% 7.7% 7.7% 3.8% 7.7% 26
7 Wistron Corp. 0.0% 0.0% 53.5% 2.3% 4.7% 2.3% 9.3% 18.6% 9.3% 43
8 Taiwan Semiconductor Mfg. Co., Ltd. 0.0% 0.0% 12.5% 0.0% 12.5% 0.0% 8.3% 37.5% 29.2% 24
9 Compal Electronics, Inc. 0.0% 0.0% 46.4% 0.0% 0.0% 1.8% 5.4% 41.1% 5.4% 56
10 Nan Ya Plastics Corp. 0.0% 0.0% 92.1% 0.0% 0.0% 0.0% 0.0% 0.0% 7.9% 38
11 Delta Electronics, Inc. 0.0% 0.0% 67.6% 0.0% 5.4% 0.0% 2.7% 18.9% 5.4% 37
12 United Microelectronics Corp. 0.0% 0.0% 50.0% 0.0% 11.1% 0.0% 5.6% 22.2% 11.1% 18
13 Formosa Chemicals & Fiber Corp. 0.0% 0.0% 88.9% 0.0% 0.0% 0.0% 0.0% 5.6% 5.6% 18
14 Inventec Corporation 0.0% 0.0% 52.4% 0.0% 4.8% 4.8% 0.0% 14.3% 23.8% 21
15 Cheng Shin Rubber Ind. Co., Ltd. 0.0% 0.0% 60.9% 0.0% 0.0% 0.0% 8.7% 17.4% 13.0% 23
16 Formosa Plastics Corp. 0.0% 0.0% 80.0% 0.0% 0.0% 0.0% 0.0% 10.0% 10.0% 10
17 Yang Ming Marine Transport Corp. 0.0% 6.5% 30.4% 2.2% 4.3% 2.2% 26.1% 6.5% 21.7% 46
18 Synnex Technology International Corp. 0.0% 4.2% 58.3% 4.2% 8.3% 0.0% 0.0% 20.8% 4.2% 24
19 Far Eastern New Century Corporation 0.0% 0.0% 59.4% 0.0% 0.0% 0.0% 6.3% 34.4% 0.0% 32
20 Qisda Corp. 1.6% 0.0% 54.7% 1.6% 4.7% 3.1% 17.2% 9.4% 7.8% 64
a
The Regionality Index is calculated by dividing the number of a firms foreign affiliates in a particular region of the world by its total number of foreign affiliates and multiplying
the result by 100.
Page 17 of 29
EXHIBIT 30
PAGE 530
Annex table 2a. Taiwan: The top 20 multinationals: Number of affiliates by region, 2009
Developed
Asia-
Middle Eastern Latin
Rank by Sub- East Asia Pacific
East & South Europe & Other America & North
foreign Firm Saharan & the (Japan, Total
North Asia Central Europe the America
assets Africa Pacific Australia
Africa Asia Caribbean
& New
Zealand)
1 Hon Hai Precision Ind. Co., Ltd. 0 0 138 4 4 11 7 121 29 314
2 Pou Chen Corporation 0 0 18 0 0 0 0 20 1 39
3 Asustek Computer Inc. 2 3 61 1 3 5 12 45 10 142
4 Quanta Computer Inc. 0 1 24 0 1 0 2 11 11 50
5 Acer Inc. 0 2 33 0 8 5 47 23 21 139
6 AU Optronics Corp. 0 0 15 0 4 2 2 1 2 26
7 Wistron Corp. 0 0 23 1 2 1 4 8 4 43
8 Taiwan Semiconductor Mfg. Co., Ltd. 0 0 3 0 3 0 2 9 7 24
9 Compal Electronics, Inc. 0 0 26 0 0 1 3 23 3 56
10 Nan Ya Plastics Corp. 0 0 35 0 0 0 0 0 3 38
11 Delta Electronics, Inc. 0 0 25 0 2 0 1 7 2 37
12 United Microelectronics Corp. 0 0 9 0 2 0 1 4 2 18
13 Formosa Chemicals & Fiber Corp. 0 0 16 0 0 0 0 1 1 18
14 Inventec Corporation 0 0 11 0 1 1 0 3 5 21
15 Cheng Shin Rubber Ind. Co., Ltd. 0 0 14 0 0 0 2 4 3 23
16 Formosa Plastics Corp. 0 0 8 0 0 0 0 1 1 10
17 Yang Ming Marine Transport Corp. 0 3 14 1 2 1 12 3 10 46
18 Synnex Technology International Corp. 0 1 14 1 2 0 0 5 1 24
19 Far Eastern New Century Corporation 0 0 19 0 0 0 2 11 0 32
20 Qisda Corp. 1 0 35 1 3 2 11 6 5 64
Total 3 10 541 9 37 29 108 306 121 1,164
Page 18 of 29
EXHIBIT 30
PAGE 531
Annex table 3. Taiwan: The top 20 multinationals: Stock exchange listings, 2009
Firm Domestic Foreign
Hon Hai Precision Ind. Co., Ltd. Taiwan Stock Exchange London
Pou Chen Corporation Taiwan Stock Exchange None
Asustek Computer Inc. Taiwan Stock Exchange London
Quanta Computer Inc. Taiwan Stock Exchange Luxembourg
Acer Inc. Taiwan Stock Exchange London
AU Optronics Corp. Taiwan Stock Exchange New York (NYSE)
Wistron Corp. Taiwan Stock Exchange Luxembourg
Taiwan Semiconductor Mfg. Co., Ltd. Taiwan Stock Exchange New York (NYSE)
Compal Electronics, Inc. Taiwan Stock Exchange Luxembourg
Nan Ya Plastics Corp. Taiwan Stock Exchange None
Delta Electronics, Inc. Taiwan Stock Exchange Luxembourg
United Microelectronics Corp. Taiwan Stock Exchange New York (NYSE)
Formosa Chemicals & Fiber Corp. Taiwan Stock Exchange None
Inventec Corporation Taiwan Stock Exchange None
Cheng Shin Rubber Ind. Co., Ltd. Taiwan Stock Exchange None
Formosa Plastics Corp. Taiwan Stock Exchange None
Yang Ming Marine Transport Corp. Taiwan Stock Exchange None
Synnex Technology International Corp. Taiwan Stock Exchange Luxembourg
Far Eastern New Century Corporation Taiwan Stock Exchange Luxembourg
Qisda Corp. Taiwan Stock Exchange Luxembourg
Source: Fu Jen-VCC research on leading Taiwanese multinationals, 2009, drawing on the Market Observation Post
System (MOPS) maintained by the Taiwan Stock Exchange (http://emops.twse.com.tw/), the Taiwan Economic Journal
(TEJ) database, and individual firms reports.
Page 19 of 29
EXHIBIT 30
PAGE 532
Exhibit 31

UNITEDSTATES
SECURITIESANDEXCHANGECOMMISSION
WASHINGTON,D.C.20549
FORM10-K
(Markone)

ANNUALREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934
ForthefiscalyearendedSeptember25,2016
OR

o TRANSITIONREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934
Forthetransitionperiodfromto.
CommissionFileNumber0-19528
QUALCOMMIncorporated
(Exactnameofregistrantasspecifiedinitscharter)

Delaware 95-3685934
(StateorOtherJurisdictionof (I.R.S.Employer
IncorporationorOrganization) IdentificationNo.)

5775MorehouseDr.
92121-1714
SanDiego,California
(ZipCode)
(AddressofPrincipalExecutiveOffices)
(858)587-1121
(Registrantstelephonenumber,includingareacode)
Securitiesregisteredpursuanttosection12(b)oftheAct:

TitleofEachClass NameofEachExchangeonWhichRegistered
Commonstock,$0.0001parvalue NASDAQStockMarketLLC
SecuritiesregisteredpursuanttoSection12(g)oftheAct:
None
Indicatebycheckmarkiftheregistrantisawell-knownseasonedissuer,asdefinedinRule405oftheSecuritiesAct.
YesxNoo
IndicatebycheckmarkiftheregistrantisnotrequiredtofilereportspursuanttoSection13orSection15(d)oftheAct.YesoNox
Indicatebycheckmarkwhethertheregistrant(1)hasfiledallreportsrequiredtobefiledbySection13or15(d)oftheSecuritiesExchangeAct
of1934duringthepreceding12months(orforsuchshorterperiodthattheregistrantwasrequiredtofilesuchreports),and(2)hasbeensubjectto
suchfilingrequirementsforthepast90days.YesxNoo
IndicatebycheckmarkwhethertheregistranthassubmittedelectronicallyandpostedonitscorporateWebsite,ifany,everyInteractiveData
FilerequiredtobesubmittedandpostedpursuanttoRule405ofRegulationS-T(232.405ofthischapter)duringthepreceding12months(orfor
suchshorterperiodthattheregistrantwasrequiredtosubmitandpostsuchfiles).YesxNoo
IndicatebycheckmarkifdisclosureofdelinquentfilerspursuanttoItem405ofRegulationS-K(229.405ofthischapter)isnotcontained
herein,andwillnotbecontained,tothebestofregistrantsknowledge,indefinitiveproxyorinformationstatementsincorporatedbyreferencein
PartIIIofthisForm10-KoranyamendmenttothisForm10-K.o
Indicatebycheckmarkwhethertheregistrantisalargeacceleratedfiler,anacceleratedfiler,anon-acceleratedfiler,orasmallerreporting
company.Seethedefinitionsoflargeacceleratedfiler,acceleratedfilerandsmallerreportingcompanyinRule12b-2oftheExchangeAct.
(Checkone):
Largeacceleratedfiler x Acceleratedfiler o
Non-acceleratedfiler o (Donotcheckifasmallerreportingcompany) Smallerreportingcompany o
EXHIBIT 31
PAGE 533
Indicatebycheckmarkwhethertheregistrantisashellcompany(asdefinedinRule12b-2oftheExchangeAct).YesoNox

Theaggregatemarketvalueofthevotingandnon-votingcommonequityheldbynon-affiliatesoftheregistrantatMarch27,2016(thelast
businessdayoftheregistrantsmostrecentlycompletedsecondfiscalquarter)was$74,547,554,964,basedupontheclosingpriceoftheregistrants
commonstockonthatdateasreportedontheNASDAQGlobalSelectMarket.
Thenumberofsharesoutstandingoftheregistrantscommonstockwas1,476,886,684atOctober31,2016.
DOCUMENTSINCORPORATEDBYREFERENCE
PortionsoftheregistrantsDefinitiveProxyStatementinconnectionwiththeregistrants2017AnnualMeetingofStockholders,tobefiledwith
theCommissionsubsequenttothedatehereofpursuanttoRegulation14A,areincorporatedbyreferenceintoPartIIIofthisReport.
EXHIBIT 31
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QUALCOMMINCORPORATED
Form10-K
FortheFiscalYearEndedSeptember25,2016
Index
Page

PARTI

Item1. Business 4
Item1A. RiskFactors 17
Item1B. UnresolvedStaffComments 31
Item2. Properties 31
Item3. LegalProceedings 32
Item4. MineSafetyDisclosures 32

PARTII

Item5. MarketforRegistrantsCommonEquity,RelatedStockholderMattersandIssuerPurchasesofEquitySecurities 33
Item6. SelectedFinancialData 35
Item7. ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations 36
Item7A. QuantitativeandQualitativeDisclosuresaboutMarketRisk 49
Item8. FinancialStatementsandSupplementaryData 50
Item9. ChangesinandDisagreementswithAccountantsonAccountingandFinancialDisclosure 50
Item9A. ControlsandProcedures 50
Item9B. OtherInformation 51

PARTIII

Item10. Directors,ExecutiveOfficersandCorporateGovernance 51
Item11. ExecutiveCompensation 51
Item12. SecurityOwnershipofCertainBeneficialOwnersandManagementandRelatedStockholderMatters 51
Item13. CertainRelationshipsandRelatedTransactions,andDirectorIndependence 51
Item14. PrincipalAccountingFeesandServices 51

PARTIV

Item15. ExhibitsandFinancialStatementSchedules 51
Item16. Form10-KSummary 55
EXHIBIT 31
PAGE 535
TRADEMARKS
Qualcomm,Snapdragon,MSM,AdrenoandWirelessReacharetrademarksofQualcommIncorporated,registeredintheUnitedStatesandother
countries.QualcommHavenandRF360aretrademarksofQualcommIncorporated.CSRisatrademarkofQualcommTechnologiesInternational,
Ltd.,registeredintheUnitedStatesandothercountries.
Otherproductsandbrandnamesmaybetrademarksorregisteredtrademarksoftheirrespectiveowners.
EXHIBIT 31
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Inthisdocument,thewordsQualcomm,we,our,oursandusreferonlytoQUALCOMMIncorporatedanditssubsidiariesandnot
anyotherpersonorentity.ThisAnnualReport(including,butnotlimitedto,thesectionregardingManagementsDiscussionandAnalysisof
FinancialConditionandResultsofOperations)containsforward-lookingstatementsregardingourbusiness,investments,financialcondition,
resultsofoperationsandprospects.Wordssuchasexpects,anticipates,intends,plans,believes,seeks,estimatesandsimilar
expressionsorvariationsofsuchwordsareintendedtoidentifyforward-lookingstatements,butarenottheexclusivemeansofidentifyingforward-
lookingstatementsinthisAnnualReport.Additionally,statementsconcerningfuturematterssuchasthedevelopmentofnewproducts,
enhancementsortechnologies,industryandmarkettrends,saleslevels,expenselevelsandotherstatementsregardingmattersthatarenot
historicalareforward-lookingstatements,butarenottheexclusivemeansofidentifyingforward-lookingstatementsinthisAnnualReport.
Althoughforward-lookingstatementsinthisAnnualReportreflectourgoodfaithjudgment,suchstatementscanonlybebasedonfactsand
factorscurrentlyknownbyus.Consequently,forward-lookingstatementsareinherentlysubjecttorisksanduncertaintiesandactualresultsand
outcomesmaydiffermateriallyfromtheresultsandoutcomesdiscussedinoranticipatedbytheforward-lookingstatements.Factorsthatcould
causeorcontributetosuchdifferencesinresultsandoutcomesincludewithoutlimitationthosediscussedundertheheadingRiskFactorsbelow,
aswellasthosediscussedelsewhereinthisAnnualReport.Readersareurgednottoplaceunduerelianceontheseforward-lookingstatements,
whichspeakonlyasofthedateofthisAnnualReport.Weundertakenoobligationtoreviseorupdateanyforward-lookingstatementsinorderto
reflectanyeventorcircumstancethatmayariseafterthedateofthisAnnualReport.Readersareurgedtocarefullyreviewandconsiderthevarious
disclosuresmadeinthisAnnualReport,whichattempttoadviseinterestedpartiesoftherisksandfactorsthatmayaffectourbusiness,financial
condition,resultsofoperationsandprospects.
PARTI
Item1.Business
Weincorporatedin1985underthelawsofthestateofCalifornia.In1991,wereincorporatedinthestateofDelaware.Weoperateandreport
usinga52-53weekfiscalyearendingonthelastSundayinSeptember.Our52-weekfiscalyearsconsistoffourequalfiscalquartersof13weeks
each,andour53-weekfiscalyearsconsistofthree13-weekfiscalquartersandone14-weekfiscalquarter.Thefinancialresultsforour53-weekfiscal
yearsandour14-weekfiscalquarterswillnotbeexactlycomparabletoour52-weekfiscalyearsandour13-weekfiscalquarters.Thefiscalyears
endedSeptember25,2016,September27,2015andSeptember28,2014included52weeks.
Overview
WeledthedevelopmentandcontinuetobealeaderinthecommercializationofadigitalcommunicationtechnologycalledCDMA(Code
DivisionMultipleAccess),andwealsocontinueasaleaderinthedevelopmentandcommercializationoftheOFDMA(OrthogonalFrequency
DivisionMultipleAccess)familyoftechnologies,includingLTE(LongTermEvolution),anOFDM(OrthogonalFrequencyDivisionMultiplexing)-
basedstandardthatusesOFDMAandsingle-carrierFDMA(FrequencyDivisionMultipleAccess),forcellularwirelesscommunication
applications.WeownsignificantintellectualpropertyapplicabletoproductsthatimplementanyversionofCDMAandOFDMA,includingpatents,
patentapplicationsandtradesecrets.Themobilecommunicationsindustrygenerallyrecognizesthatacompanyseekingtodevelop,manufacture
and/orsellproductsthatuseCDMA-and/orLTE-basedstandardswillrequireapatentlicensefromus.CDMAandOFDMAaretwoofthemain
technologiescurrentlyusedindigitalwirelesscommunicationsnetworks(alsoknownaswirelessnetworks).Basedonwirelessconnections,
CDMA,OFDMAandTDMA(TimeDivisionMultipleAccess,ofwhichGSM(GlobalSystemforMobileCommunications)istheprimarycommercial
form)aretheprimarydigitaltechnologiescurrentlyusedtotransmitawirelessdeviceusersvoiceordataoverradiowavesusingapubliccellular
wirelessnetwork.
Wealsodevelopandcommercializenumerousotherkeytechnologiesusedinhandsetsandtabletsthatcontributetoend-userdemand,andwe
ownsubstantialintellectualpropertyrelatedtothesetechnologies.Someofthesewerecontributedtoandarebeingcommercializedasindustry
standards,suchascertainvideocodec,audiocodec,wirelessLAN(localareanetwork),memoryinterfaces,wirelesspower,GPS(globalpositioning
system)andpositioning,broadcastandstreamingprotocols,andshortrangecommunicationfunctionalities,includingNFC(nearfield
communication)andBluetooth.Othertechnologieswidelyusedbywirelessdevicesthatwehavedevelopedarenotrelatedtoanyindustry
standards,suchasoperatingsystems,userinterfaces,graphicsandcameraprocessingfunctionality,integratedcircuitpackagingtechniques,RF
(radiofrequency)andantennadesign,sensorsandsensorfusionalgorithms,powerandthermalmanagementtechniquesandapplicationprocessor
architectures.Ourpatentscoverawiderangeoftechnologiesacrosstheentirewirelesssystem,includingthedevice(suchashandsetsand
tablets)andnotjustwhatisembodiedinthechipsets.
Inadditiontolicensingportionsofourintellectualpropertyportfolio,whichincludescertainpatentrightsessentialtoand/orusefulinthe
manufactureandsaleofcertainwirelessproducts,wedesign,manufacture,havemanufacturedonour
EXHIBIT 31
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behalfandmarketproductsandservicesbasedonCDMA,OFDMAandotherdigitalcommunicationstechnologies.Ourproductsprincipally
consistofintegratedcircuits(alsoknownaschipsorchipsets)andsystemsoftwareusedinmobiledevices,wirelessnetworks,broadbandgateway
equipmentandconsumerelectronicdevices.Wealsosellotherproductsandservices,whichinclude,amongothers:wirelessmedicaldevicesand
softwareproductsandservicesdesignedforhealthcarecompaniesengineeringservicesandproductsdesignedfortheimplementationofsmall
cells.Inaddition,wecontinuetoinvestinnewandexpandedproductareas,suchasradiofrequencyfront-end(RFFE),andinadjacentindustry
segments,suchasautomotive,InternetofThings(IoT),datacenter,networking,mobilecomputing,theconnectedhome,smartcities,mobile
health,machinelearning,includingroboticsandwearables,amongothers.
IndustryTrends
Themobileindustryhasexperiencedtremendousgrowthoverthepast20plusyears,growingfromlessthan60millionglobalconnectionsin
1994(WCIS+,October2016)toapproximately7.4billionglobalconnectionsinSeptember2016(GSMAIntelligence,October2016).Asthelargest
technologyplatformintheworld,mobilehasmadepeopleslivesmoreconnected,transformingthewayweinteractwithoneanotherandwiththe
world.Thescaleandpaceofinnovationinmobile,especiallyaroundconnectivityandcomputingcapabilities,isalsoimpactingindustriesbeyond
wireless.
Extendingconnectivity.3G/4G(thirdgeneration/fourthgeneration)multimodemobilebroadbandtechnologyhasbeenakeydriverofthe
growthofmobile,providinguserswithfast,reliable,always-onconnectivity.AsofSeptember2016,therewereapproximately4.0billion3G/4G
connectionsglobally(CDMA-based,OFDMA-basedandCDMA/OFDMAmultimode)representingnearly54%oftotalmobileconnections.By
2020,global3G/4Gconnectionsareprojectedtoreach6.4billion,withmorethan80%oftheseconnectionscomingfromemergingregions(GSMA
Intelligence,October2016).
3G/4GmultimodemobilebroadbandhasalsoemergedasanimportantplatformforextendingthereachandpotentialoftheInternet.In2010,the
numberofbroadbandconnectionsusingmobiletechnologysurpassedthoseusingfixedtechnologies,makingmobilenetworkstheprimarymethod
ofaccesstotheInternetformanypeoplearoundtheworld.Theimpactisfurtheramplifiedinemergingregions,where3G/4Gconnectionsare
approximatelysixtimesthenumberoffixedInternetconnections(GSMAIntelligenceandWBIS,October2016).InChina,3G/4GLTEmultimode
serviceshaveexperiencedstrongadoptionsincebeinglaunchedinthefourthquarterofcalendar2013,withmorethan655millionconnections
reportedasofSeptember2016(GSMAIntelligence,October2016).InIndia,mobileoperatorsarerollingout3G/4GLTEmultimodeservices,
providingconsumerswiththebenefitsofadvancedmobilebroadbandconnectivitywhilecreatingnewopportunitiesfordevicemanufacturersand
othermembersofthemobileecosystem.3G/4Gmobilebroadbandmaybethefirstand,inmanycases,theonlywaythatpeopleintheseregions
accesstheInternet.
Lookingahead,thewirelessindustryisactivelydevelopingandstandardizing5G(fifthgeneration)technology,whichisthenextgenerationof
wirelesstechnologyexpectedtobecommerciallydeployedstartingin2019.Whilethe5Gstandardisstillbeingdefined,itisexpectedtoprovidea
unifiedconnectivitynetworkforallspectrumandservicetypesbasedonOFDMtechnology.5Gisexpectedtosupportfasterdataratesandwider
bandwidthsofspectrum.Incorporatingmanyoftheinnovationsdevelopedfor4G,5Gisalsoexpectedtobescalableandadaptableacrossavariety
ofusecases,whichinclude,amongothers:enablingnewindustriesandservices,suchasautonomousvehiclesandremotemedicalprocedures,
throughultra-reliable,ultra-lowlatencycommunicationlinksandconnectingasignificantnumberofthings(alsoknownastheInternetof
ThingsorIoT),suchasconsumerelectronics,includingwearables,appliances,sensorsandmedicaldevices,withconnectivitydesignedtomeet
ultra-lowpower,complexityandcostrequirements.5Gisalsoexpectedtoenhancemobilebroadbandservices,includingultra-highdefinition(4K)
videostreamingandvirtualreality,withmulti-gigabitspeeds.
Most5Gdevicesareexpectedtoincludemultimodesupportfor3G,4GandWi-Fi,enablingservicecontinuitywhere5Ghasyettobedeployed
andsimultaneousconnectivityacross4GandWi-Fitechnologies,whilealsoallowingmobileoperatorstoutilizecurrentnetworkdeployments.At
thesametime,4Gwillcontinuetoevolveinparallelwiththedevelopmentof5Gandisexpectedtopioneermanyofthekey5Gtechnologies,such
assupportforunlicensedspectrumandgigabitLTEuserdatarates.Thefirstphaseof5Gnetworksareexpectedtosupportmobilebroadband
servicesbothinlowerspectrumbandsbelow6Ghzaswellashigherbandsabove6GHz,includingmillimeterwave(mmWave).
Growthinsmartphones.Smartphoneadoptioncontinuestoexpandglobally,fueledby3G/4GLTEmultimodeconnectivity,powerful
applicationprocessorsandadvancedmultimediaandlocationawarenesscapabilities,amongothers.In2015,morethan1.4billionsmartphones
shippedglobally,representingayear-over-yearincreaseofapproximately14%,andcumulativeshipmentsofsmartphonesbetween2016and2020
areprojectedtoreachapproximately8.3billion(Gartner,September2016).Mostofthisgrowthishappeninginemergingregions,where
smartphonesaccountedforapproximately70%ofhandsetshipmentsin2015andareexpectedtoreachapproximately92%in2020(Gartner,
September2016).Growthinsmartphoneshasnotonlybeendrivenbythesuccessofpremium-tierdevices,butalsobythenumberofaffordable
EXHIBIT 31
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handsetsthatarefuelingshipmentsinemergingregionsandthevarietyofflexibleandaffordabledataplansbeingofferedbymobileoperators.
Consumerdemandfornewtypesofexperiencesenabledby3G/4GLTEconnectivity,combinedwiththeneedsofmobileoperatorsanddevice
manufacturerstoprovidedifferentiatedfeaturesandservices,isdrivingcontinuedinnovationwithinthesmartphone.Thisinnovationishappening
acrossmultipletechnologydimensions,includingconnectivity,computing,camera,audio,video,display,location,sensorsandsecurity.Asa
result,thesmartphonehas,inmanyways,becomethego-todeviceforsocialnetworking,music,gaming,emailandwebbrowsing,amongothers.It
isalsoreplacingmanytraditionalconsumerelectronicsdevicesduetoadvancedcapabilities,includingdigitalcameras,videocameras,Global
PositioningSystem(GPS)unitsandmusicplayers,combinedwithanalwaysonandconnectedmobileplatform.
Expansionintonewadjacentopportunities.Anumberofindustriesbeyondmobileareleveragingtechnologyinnovationsfoundin
smartphonestobringadvancedconnectivityandcomputingcapabilitiestoabroadarrayofend-devicesandaccesspoints,whichmakeupthe
edgeofthenetwork.WithbillionsofconnecteddevicesprojectedtobeaddedtotheInternetoverthecomingyears,enhancingthecapabilities
andperformanceattheedgeofthenetworkwillbevitaltoimprovingitsscalabilityasitentersthisnewphaseofgrowth.Theseenhancementsare
helpingtotransformindustrysegments,includingnetworking,automotive,mobilecomputingandtheIoT,andenablingcompaniestocreatenew
productsandservices.
Theproliferationofintelligentlyconnectedthingsisalsoenablingnewtypesofuserexperiences,assmartphonesareabletointeractwithand
controlmoreofthethingsaroundus.Throughtheadditionofembeddedsensors,connectedthingsareabletocollectandsenddataabouttheir
environment,providinguserswithcontextuallyrelevantinformationandfurtherincreasingtheirutilityandvalue.
WirelessTechnologies
Thegrowthintheuseofwirelessdevicesworldwide,suchassmartphonesandtablets,andthedemandfordataservicesandapplications
requirescontinuousinnovationtofurtherimprovetheuserexperience,enablenewservices,increasenetworkcapacity,makeuseofdifferent
frequencybandsandenabledensenetworkdeployments.Tomeettheserequirements,differentwirelesscommunicationstechnologiescontinueto
evolve.Fornearlythreedecades,wehaveinvestedandcontinuetoinvestheavilyinresearchanddevelopmentofcellularwirelesscommunication
technologies,includingCDMAandOFDMA.Asaresult,wehavedevelopedandacquired(andcontinuetodevelopandacquire)significant
relatedintellectualproperty.Thisintellectualpropertyhasbeenincorporatedintothemostwidelyacceptedanddeployedcellularwireless
communicationstechnologystandards,andwehavelicensedittomorethan330licensees,includingleadingwirelessdeviceandinfrastructure
manufacturers.Relevantcellularwirelesstechnologiescanbegroupedintothefollowingcategories.
TDMA-based.TDMA-basedtechnologiesarecharacterizedbytheiraccessmethodallowingseveraluserstosharethesamefrequency
channelbydividingthesignalintodifferenttimeslots.Mostofthesesystemsareclassifiedas2G(secondgeneration)technology.Themain
examplesofTDMA-basedtechnologiesareGSM(deployedworldwide),IS-136(deployedintheAmericas)andPersonalDigitalCellular(PDC)
(deployedinJapan).
Todate,GSMhasbeenmorewidelyadoptedthanCDMA-basedstandardshowever,CDMAtechnologiesarethebasisforall3Gwireless
systems.AccordingtoGSMAIntelligenceestimatesasofSeptember30,2016,therewereapproximately3.4billionGSMconnectionsworldwide,
representingapproximately46%oftotalcellularconnections.Thetransitionofwirelessdevicesfrom2Gto3G/4Gcontinuedaroundtheworldwith
3G/4Gconnectionsup18%year-over-year(GSMAIntelligence,October2016).
CDMA-based.CDMA-basedtechnologiesarecharacterizedbytheiraccessmethodallowingseveraluserstosharethesamefrequencyand
timebyallocatingdifferentorthogonalcodestoindividualusers.MostoftheCDMA-basedtechnologiesareclassifiedas3Gtechnology.
ThereareanumberofvariantsofCDMA-basedtechnologiesdeployedaroundtheworld,inparticularCDMA2000,EV-DO(EvolutionData
Optimized),WCDMA(WidebandCDMA)andTD-SCDMA(TimeDivision-SynchronousCDMA)(deployedexclusivelyinChina).CDMA-based
technologiesprovidevastlyimprovedcapacityforvoiceandlow-ratedataservicesascomparedtoanalogtechnologiesandsignificant
improvementsoverTDMA-basedtechnologiessuchasGSM.Todate,thesetechnologieshaveseenmanyrevisions,andtheycontinuetoevolve.
Newfeaturescontinuetobedefinedinthe3rdGenerationPartnershipProject(3GPP).ThefollowingaretheCDMA-basedtechnologiesandtheir
standardsrevisions:
CDMA2000revisionsAthroughE
1xEV-DOrevisionsAthroughC
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WCDMA/HSPAreleases4through13
TD-SCDMAreleases4through12
CDMAtechnologiesusheredinasignificantincreaseinbroadbanddataservicesthatcontinuetogrowglobally.AccordingtoGSMA
IntelligenceestimatesasofOctober2016,therewereapproximately2.5billionCDMA-basedconnectionsworldwide,representingapproximately
33%oftotalcellularconnections.
OFDMA-based.OFDMA-basedtechnologiesarecharacterizedbytheiraccessmethodallowingseveraluserstosharethesamefrequency
bandandtimebyallocatingdifferentsubcarrierstoindividualusers.MostoftheOFDMA-basedtechnologiestobedeployedthrough2016are
classifiedas4Gtechnology.Itisexpectedthat5GwillheavilyleverageOFDM-basedtechnologies.Wecontinuetoplayasignificantroleinthe
developmentofLTEandLTEAdvanced,whicharethepredominant4Gtechnologiescurrentlyinuse,andtheirevolutiontoLTEAdvancedPro.
LTEisincorporatedin3GPPspecificationsstartingfromrelease8andusesOFDMAinthedownlinkandsinglecarrierFDMA(SC-FDMA)in
theuplink.LTEhastwomodes,FDD(frequencydivisionduplex)andTDD(timedivisionduplex),tosupportpairedandunpairedspectrum,
respectively,andisbeingdevelopedby3GPP.TheprincipalbenefitofLTEisitsabilitytoleverageawiderangeofspectrum(bandwidthsof10MHz
ormore).LTEisdesignedtoseamlesslyinterworkwith3Gthrough3G/4Gmultimodedevices.MostLTEdevicesrelyon3Gforvoiceservicesacross
thenetwork,aswellasforubiquitousdataservicesoutsidetheLTEcoverageareaandon4GfordataservicesinsidetheLTEcoveragearea.LTEs
voicesolution,VoLTE(voiceoverLTE),isbeingcommerciallydeployedinagrowingnumberofnetworks.
Carrieraggregation,oneofthesignificantimprovementsofLTEAdvanced,wascommerciallylaunchedinJune2013andcontinuestoevolve
toaggregateadditionalcarriersintheuplinkaswellasthedownlink.Alongwithcarrieraggregation,LTEAdvancedbringsmanymore
enhancements,includingadvancedantennatechniquesandoptimizationforsmallcells.Apartfromimprovingtheperformanceofexisting
networks,thesereleasesalsobringnewenhancementsundertheumbrellaofLTEAdvancedPro,suchasLTEDirectforproximity-baseddevice-to-
devicediscovery,improvedLTEbroadcast,optimizationsofnarrowbandcommunicationsdesignedforIoT(knownasNB-IoT)andtheabilityto
useLTEAdvancedinunlicensedspectrum(LTEUnlicensed).TherewillbemultipleoptionsfordeployingLTEUnlicensedfordifferentdeployment
scenarios.
LTE-U,whichreliesonanLTEcontrolcarrierbasedon3GPPRelease12,usescarrieraggregationtocombineunlicensedandlicensed
spectrumandwillbeusedinearlymobileoperatordeploymentsincountriessuchastheUnitedStates,KoreaandIndia.
LicensedAssistedAccess(LAA),introducedaspartof3GPPRelease13,alsoaggregatesunlicensedandlicensedspectrum.
MulteFireoperatessolelyinunlicensedspectrumwithoutalicensedanchorcontrolchannel.
TherealsohavebeenongoingeffortstomaketheinterworkingbetweenLTEandWi-Fimoreseamlessandcompletelytransparenttotheusers.
TheseamlessinterworkingisalsointendedtoenablethedevicetousethebestpossiblelinkorlinksdependingonconditionsoftheLTEandWi-Fi
linksastheapplicationsrunondevices.FurtherintegrationisachievedwithLTE+Wi-FilinkAggregation(LWA),whichwillutilizeexistingandnew
carrierWi-Fideployments.
LTEreleasesareoftencombinedandgivenmarketingortradenamesthatalsoindicatetheirbenefits.ThenameLTEcoversreleases8and
9.Releases10andbeyondarereferredtoasLTEAdvanced.AccordingtoGSMAIntelligenceestimatesasofSeptember30,2016,therewere
approximately1.5billionglobal3G/4Gmultimodeconnectionsworldwide,representingapproximately21%oftotalcellularconnections.
AccordingtotheGlobalmobileSuppliersAssociation(GSA),asofOctober2016,morethan770wirelessoperatorshavecommercially
deployedorstartedtestingLTE.Inaddition,LTEAdvancedstandardsfeaturingcarrieraggregationhavebeguntobedeployed.AsofOctober
2016,212operatorswereinvestinginLTEAdvancedcarrieraggregationacross88countries,and166operatorshavelaunchedcommerciallyin76
countries(GSA,October2016).
Aswelookforward,thewirelessindustryisactivelybuildingthenextgenerationofcellulartechnologiesunderthename5Gin3GPP.While5G
isstillbeingdefined,itisexpectedthat5Gwilltransformtheroleofwirelesstechnologiesandincorporateadvancementson3G/4Gfeatures
availabletoday,includingfurtherenhancedmobilebroadbandservices,device-to-devicecapabilitiesanduseofbothlicensedandunlicensed
spectrumandconnectivityofasignificantnumberofthings.5Gisalsoexpectedtoincludeoperationinemerginghigherfrequencybandssuchas
thoseinthemillimeterwaverangetosignificantlyincreasethedatarateofferedtousers.Furthermore,5Gisexpectedtooffertechniquesthatwill
enabletheexpansionofcellularnetworksintonewverticalproductsegmentsanddefinearadiolinkwithmuchhigherlevelsofreliabilityforcontrol
ofvehiclesandmachines.Thisdevelopment,whichbuildsonthevarious3Gand4Gfeatures
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addressingIoT,willfurthersustainthetrendofenablingcellularconnectivitytonon-handsetcategoriesofdevices.Wecontinuetoplaya
significantroleindriving5Gfromstandardizationtocommercialization,includingcontributingto3GPPstandardizationactivitiestodefinethe5G
standardandcollaboratingwithindustryparticipantson5Gdemonstrationsandtrialstoprepareforcommercialnetworklaunches.
Other(non-cellular)wirelesstechnologies.Thereareother,non-cellularwirelesstechnologiesthathavealsobeenbroadlyadopted.
WirelessLocalAreaNetworks.Wirelesslocalareanetworks(WLAN),suchasWi-Fi,linktwoormorenearbydeviceswirelesslyandusually
provideconnectivitythroughanaccesspoint.Wi-FisystemsarebasedonstandardsdevelopedbytheInstituteofElectricalandElectronics
Engineers(IEEE)inthe802.11familyofstandards.802.11ac,whichincludesadvancedfeaturessuchasmultipleusermultiplein/multipleout(MU
MIMO)andsupportforlargebandwidthsandhigherordermodulation,primarilytargetsbroadbandconnectivityformobiledevices,laptopsand
consumerelectronicsdevicesusing5GHzspectrum.802.11adprovidesmulti-gigabitdataratesforshortrangecommunicationusing60GHz
spectrum.802.11ah,whichisstillunderdevelopmentandtargetssub-1GHzspectrum,isenvisionedtobeasolutionforconnectedhome
applicationsthatrequirelongbatterylife.Weplayedaleadingroleinthedevelopmentof802.11ac,802.11adand802.11ah,andweareactively
involvedinthedevelopmentof802.11ax,whichisanevolutionfrom802.11acandwillcoverboththe2.4GHzand5GHzunlicensedbands.
Bluetooth.Bluetoothisawirelesspersonalareanetworkthatprovideswirelessconnectivitybetweendevicesovershortdistancesranging
fromafewcentimeterstoafewmeters.Bluetoothtechnologyprovideswirelessconnectivitytoawiderangeoffixedormobileconsumer
electronicsdevices.BluetoothfunctionalitiesarestandardizedbytheBluetoothSpecialInterestGroupinvariousversionsofthespecification
(from1.0to4.0),whichincludedifferentfunctionalities,suchasenhanceddatarateorlowenergy(knownasBluetoothSmart).InAugust2015,we
acquiredCSRplc,aleadingcontributortoBluetoothevolutionintheareasofmobiledevices,HID(humaninterfacedevice),A/V(audio/video)and
SmartMeshtechnologies.
LocationPositioningTechnologies.Locationpositioningtechnologieshaveevolvedrapidlyintheindustryoverthepastfewyearsinorder
todeliveranenhancedlocationexperience.Inthepast,satellitenavigationsystemswerepredominantlyusedtoprovidetheaccuratelocationof
mobiledevices.WewereakeydeveloperoftheAssisted-GPS(A-GPS)positioningtechnologyusedinmostcellularhandsetstoday.Foruses
requiringthebestaccuracyforE911servicesandnavigationalbasedservices,A-GPSprovidedaleading-edgesolution.
Theindustryhasnowevolvedtosupportadditionalinputsforimprovingthelocationexperience.Wenowsupportmultipleconstellations,
includingGPS,GLONASS(GlobalNavigationSatelliteSystem)andBeiDouterrestrial-basedpositioningusingWWAN(WirelessWideArea
Network)andWi-Fi-basedinputsWi-FiRSSI(receivedsignalstrengthindication)andRTT(round-triptime)signalsforindoorlocationandthird-
partysensorscombinedwithGNSS(GlobalNavigationSatelliteSystem)measurementstoprovideinterimsupportforlocation-basedservicesin
ruralareasandindoors,whereothersignalinputsmaynotbeavailable.
OtherSignificantTechnologiesusedinCellularandCertainConsumerElectronicDevicesandNetworks
Wehaveplayedaleadingroleindevelopingmanyoftheothertechnologiesusedincellularandcertainconsumerelectronicdevicesand
networks,including:
graphicsanddisplayprocessingfunctionality
videocodingbasedonHEVC(HighEfficiencyVideoCodec)standard,whichwillbedeployedtosupport4Kvideocontent
audiocoding,includingEVS(EnhancedVoiceServices)
thelatestversionof3GPPscodecformultimediauseandforvoice/speechuse,whichisbeingdeployedcommercially
cameraandcamcorderfunctions
systemuserandinterfacefeatures
securityandcontentprotectionsystems
volatile(LP-DDR2,3,4)andnon-volatile(eMMC)memoryandrelatedcontrollersand
powermanagementsystems.
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OperatingSegments
Weconductbusinessprimarilythroughtworeportablesegments,QCT(QualcommCDMATechnologies)andQTL(QualcommTechnology
Licensing),andourQSI(QualcommStrategicInitiatives)reportablesegmentmakesstrategicinvestments.Revenuesinfiscal2016,2015and2014
forourreportablesegmentswereasfollows(inmillions,exceptpercentagedata):
QCT QTL QSI

2016 $ 15,409 $ 7,664 $ 47
Asapercentoftotal 65% 33% -
2015 $ 17,154 $ 7,947 $ 4
2014 $ 18,665 $ 7,569 $ -
QCTSegment.QCTisaleadingdeveloperandsupplierofintegratedcircuitsandsystemsoftwarebasedonCDMA,OFDMAandother
technologiesforuseinwirelessvoiceanddatacommunications,networking,applicationprocessing,multimediaandglobalpositioningsystem
products.QCTsintegratedcircuitproductsaresold,anditssystemsoftwareislicensed,tomanufacturersthatuseourproductsinmobilephones,
tablets,laptops,datamodules,handheldwirelesscomputersandgamingdevices,accesspointsandrouters,datacardsandinfrastructure
equipment,broadbandgatewayequipmentandotherconsumerelectronics.OurMobileStationModem(MSM)integratedcircuits,whichinclude
theMobileDataModem,QualcommSingleChipandQualcommSnapdragonprocessorsandLTEmodems,performthecorebasebandmodem
functionalityinwirelessdevicesprovidingvoiceanddatacommunications,aswellasmultimediaapplicationsandglobalpositioningfunctions.In
addition,ourSnapdragonprocessorsprovideadvancedapplicationandgraphicsprocessingcapabilities.Becauseofourexperienceindesigning
anddevelopingCDMA-andOFDMA-basedproducts,wedesignboththebasebandintegratedcircuitandthesupportingsystemaswell,
includingtheRF(RadioFrequency),PM(PowerManagement)andwirelessconnectivityintegratedcircuits.Thisapproachenablesustooptimize
theperformanceofthewirelessdevicewithimprovedproductfeaturesandintegrationwiththenetworksystem.OurportfolioofRFproducts
includesQFE(QualcommFrontEnd)radiofrequencyfront-endcomponentsthataredesignedtosimplifytheRFdesignforLTEmultimode,
multibandmobiledevices,reducepowerconsumptionandimproveradioperformance.QCTssystemsoftwareenablestheotherdevice
componentstointerfacewiththeintegratedcircuitproductsandisthefoundationsoftwareenablingmanufacturerstodevelopdevicesutilizingthe
functionalitywithintheintegratedcircuits.Wealsoprovidesupport,includingreferencedesignsandtools,toassistourcustomersinreducingthe
timerequiredtodesigntheirproductsandbringtheirproductstomarket.Weplantoaddadditionalfeaturesandcapabilitiestoourintegrated
circuitproductstohelpourcustomersreducethecostandsizeoftheirproducts,tosimplifyourcustomersdesignprocessesandtosupportmore
wirelessdevicesandservices.
QCToffersabroadportfolioofproducts,includingbothwirelessdeviceandinfrastructureintegratedcircuits,insupportofCDMA20001X
and1xEV-DO,aswellastheEV-DORevisionA/BevolutionsofCDMA2000technology.LeveragingourexpertiseinCDMA,wealsodevelopand
offerintegratedcircuitssupportingtheWCDMAversionof3Gformanufacturersofwirelessdevices.Morethan80devicemanufacturershave
selectedourWCDMAproductsthatsupportGSM/GPRS,WCDMA,HSDPA(High-SpeedDownlinkPacketAccess),HSUPA(High-SpeedUplink
PacketAccess)andHSPA+fortheirdevices.QCTalsosellsmultimodeproductsfortheLTEstandard,whicharedesignedtosupportseamless
backwardcompatibilitytoexisting3Gtechnologies.Ourintegratedcircuitproductsareincludedinabroadrangeofdevices,fromlow-tier,entry-
leveldevicesforemergingregions,whichmayuseourQualcommReferenceDesign(QRD)products,topremium-tierdevices.Infiscal2016,QCT
shippedapproximately842millionMSMintegratedcircuitsforwirelessdevicesworldwide,comparedtoapproximately932millionand861millionin
fiscal2015and2014,respectively.
Ourmodemsarebuilttoworkwithincreasinglycomplexnetworks.Theysupportthelatestcommunicationtechnologiesandadapttonetwork
conditionsanduserneedsinrealtimetoenabledeliveryoffaster,smootherdataandvoiceconnections.Our3G/4Gmodemroadmapdeliversthe
latestnetworktechnologiesacrossmultipleproducttiersanddevices.Thisroadmapistheresultofouryearsofresearchintoemergingnetwork
standardsandthedevelopmentofchipsetsthattakeadvantageofthesenewstandards,whilemaintainingbackwardcompatibilitywithexisting
standards.
EachSnapdragonprocessorisahighlyintegrated,mobileoptimizedsystemonachipincorporatingouradvancedtechnologies,includinga
Snapdragonmodemforfastreliablemobilebroadbandconnectivity,ahighperformancecentralprocessingunit(CPU),digitalsignalprocessor
(DSP),graphicsprocessingunit(GPU),imagesignalprocessor,multimediasubsystems,includinghighfidelityaudio,high-definitionvideoand
advancedimagingcapabilities,ourhardware-basedsuite
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ofQualcommHavenSecuritySolutions,andaccuratelocationpositioningengines.OurCPUcoresaredesignedtodeliverhighlevelsofcompute
performanceatlowpower,allowingmanufacturerstodesignpowerful,slimandpower-efficientdevices.OurQualcommAdrenoGPUsarealso
designedtodeliverhighqualitygraphicsperformanceforvisuallyrich3Dgaminganduserinterfaces.Theheterogeneouscomputearchitectureof
ourSnapdragonprocessorsisdesignedtohelpensurethattheCPU,DSPandGPUworkefficientlytogether,eachbeingutilizedonlywhenneeded,
whichenhancestheprocessingcapacity,speedandefficiencyofourSnapdragonprocessorsandthebatterylifeofdevicesusingourprocessors.
OurwirelessproductsalsoconsistofintegratedcircuitsandsystemsoftwareforWLAN,Bluetooth,BluetoothSmart,frequencymodulation
(FM)andnearfieldcommunicationsaswellastechnologiesthatsupportlocationdataandservices,includingGPS,GLONASSandBeiDou.Our
WLAN,BluetoothandFMproductshavebeenintegratedwiththeSnapdragonprocessorstoprovideadditionalconnectivityformobilephones,
tabletsandconsumerelectronics.QCTalsooffersstandaloneWLAN,Bluetooth,BluetoothSmart,applicationsprocessorandEthernetproducts
formobiledevices,consumerelectronics,computers,automotiveinfotainment,IoTapplicationsandotherconnecteddevices.Ournetworking
productsincludeWLAN,PowerlineandEthernetchips,networkprocessorsandsoftware.Theseproductshelpenablehomeandbusiness
networkstosupportthegrowingnumberofconnecteddevices,digitalmedia,dataservicesandothersmarthomeapplications.
QCTcurrentlyutilizesafablessproductionmodel,whichmeansthatwedonotownoroperatefoundriesfortheproductionofsiliconwafers
fromwhichourintegratedcircuitsaremade.Integratedcircuitsarediecutfromsiliconwafersthathavecompletedthepackageassemblyandtest
manufacturingprocesses.Thesemiconductorpackagesupportstheelectricalcontactsthatconnecttheintegratedcircuittoacircuitboard.Diecut
fromsiliconwafersaretheessentialcomponentsofallofourintegratedcircuitsandasignificantportionofthetotalintegratedcircuitcost.We
employbothturnkeyandtwo-stagemanufacturingmodelstopurchaseourintegratedcircuits.Undertheturnkeymodel,ourfoundrysuppliersare
responsiblefordeliveringfullyassembledandtestedintegratedcircuits.Underthetwo-stagemanufacturingmodel,wepurchasedieinsingularor
waferformfromsemiconductormanufacturingfoundriesandcontractwithseparatethird-partysuppliersformanufacturingservicessuchaswafer
bump,probe,assemblyandfinaltest.
Werelyonindependentthird-partysupplierstoperformthemanufacturingandassembly,andmostofthetesting,ofourintegratedcircuits
basedprimarilyonourproprietarydesignsandtestprograms.Oursuppliersalsoareresponsiblefortheprocurementofmostoftherawmaterials
usedintheproductionofourintegratedcircuits.Theprimaryfoundrysuppliersforourvariousdigital,analog/mixed-signal,RFandPMintegrated
circuitsareGlobalFoundriesInc.,SamsungElectronicsCo.Ltd.,SemiconductorManufacturingInternationalCorporation,TaiwanSemiconductor
ManufacturingCompanyandUnitedMicroelectronicsCorporation.TheprimarysemiconductorassemblyandtestsuppliersareAdvanced
SemiconductorEngineering,AmkorTechnology,SiliconwarePrecisionIndustriesandSTATSChipPAC.Themajorityofourfoundryand
semiconductorassemblyandtestsuppliersarelocatedintheAsia-Pacificregion.
QCTssalesareprimarilymadethroughstandardpurchaseordersfordeliveryofproducts.QCTgenerallyallowscustomerstoreschedule
deliverydateswithinadefinedtimeframeandtocancelorderspriortoshipmentwithorwithoutpaymentofapenalty,dependingonwhenthe
orderiscanceled.TheindustryinwhichQCToperatesisintenselycompetitive.QCTcompetesworldwidewithanumberofUnitedStatesand
internationaldesignersandmanufacturersofsemiconductors.Asaresultofglobalexpansionbyforeignanddomesticcompetitors,technological
changes,devicemanufacturerconcentrationsandthepotentialforfurtherindustryconsolidation,weanticipatetheindustrytoremainvery
competitive.Webelievethattheprincipalcompetitivefactorsforourproductsincludeperformance,levelofintegration,quality,compliancewith
industrystandards,price,time-to-market,systemcost,designandengineeringcapabilities,newproductinnovationandcustomersupport.QCT
alsocompetesinbothsingle-andmulti-modeenvironmentsagainstalternativecommunicationstechnologiesincluding,butnotlimitedto,
GSM/GPRS/EDGEandTDMA.
QCTscurrentcompetitorsinclude,butarenotlimitedto,companiessuchasBroadcomLimited,CirrusLogic,Ericsson,HiSiliconTechnologies,
Intel,MarvellTechnology,MaximIntegratedProducts,MediaTek,MicrochipTechnologyInc.,Nvidia,RealtekSemiconductor,Samsung
Electronics,SkyworksSolutionsInc.andSpreadtrumCommunications(whichiscontrolledbyTsinghuaUnigroup).QCTalsofacescompetition
fromproductsinternallydevelopedbyourcustomers,includingsomeofourlargestcustomers,andfromsomeearly-stagecompanies.Our
competitorsdevotesignificantamountsoftheirfinancial,technicalandotherresourcestodevelopandmarketcompetitiveproductsand,insome
cases,todevelopandadoptcompetitivedigitalcommunicationorsignalprocessingtechnologies,andthoseeffortsmaymateriallyandadversely
affectus.Althoughwehaveattainedasignificantpositionintheindustry,manyofourcurrentandpotentialcompetitorsmayhaveadvantages
overusthatinclude,amongothers:motivationbyourcustomersincertaincircumstancestoutilizetheirowninternally-developedintegratedcircuit
products,touseourcompetitorsintegratedcircuitproducts,ortochoosealternativetechnologieslowercoststructuresand/orawillingnessand
abilitytoacceptlowerpricesandlowerornegativemarginsfortheirproducts,particularlyinChinaforeigngovernmentsupportofother
technologiesorcompetitors
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betterknownbrandnamesownershipandcontrolofmanufacturingfacilitiesandgreaterexpertiseinmanufacturingprocessesmoreextensive
relationshipswithlocaldistributioncompaniesandoriginalequipmentmanufacturersinemerginggeographicregions(suchasChina)and/ora
moreestablishedpresenceincertainregions.
QTLSegment.QTLgrantslicensesorotherwiseprovidesrightstouseportionsofourintellectualpropertyportfolio,which,amongother
rights,includecertainpatentrightsessentialtoand/orusefulinthemanufactureandsaleofcertainwirelessproducts,including,withoutlimitation,
productsimplementingCDMA2000,WCDMA,CDMATDDand/orLTEstandardsandtheirderivatives.Ourlicenseesmanufacturewireless
productsincludingmobiledevices(alsoknownassubscriberunits,whichincludehandsets),otherconsumerdevices(e.g.,tabletsandlaptops),
machine-to-machinedevices(e.g.,telematicsdevices,meterreadingdevices),plug-inenduserdatamodemcards,certainembeddedmodulesfor
incorporationintoenduserproducts,infrastructureequipmentrequiredtoestablishandoperateanetworkandequipmenttotestnetworksand
subscriberunits.QTLlicensingrevenuesincludelicensefeesandroyaltiesbasedonsalesbylicenseesofproductsincorporatingorusingour
intellectualproperty.Licensefeesarefixedamountspaidinoneormoreinstallments.Royaltiesaregenerallybaseduponapercentageofthe
wholesale(i.e.,licensees)sellingpriceofcompletelicensedproducts,netofcertainpermissibledeductions(includingtransportation,insurance,
packingcostsandotheritems).Revenuesgeneratedfromroyaltiesaresubjecttoquarterlyandannualfluctuations.ThevastmajorityofQTL
revenueshavebeengeneratedthroughourlicenseessalesofCDMA2000-andWCDMA-basedproducts,suchasfeaturephonesand
smartphones.WehaveinvestedandcontinuetoinvestinboththeacquisitionanddevelopmentofOFDMAtechnologyandintellectualproperty
andhavegeneratedtheindustryleadingpatentportfolioapplicabletoLTEandLTEAdvanced.Nevertheless,wefacecompetitioninthe
developmentofintellectualpropertyforfuturegenerationsofdigitalwirelesscommunicationstechnologiesandservices.
InFebruary2015,wereachedaresolutionwiththeNationalDevelopmentandReformCommission(NDRC)inChinaregardingitsinvestigation
andagreedtoimplementarectificationplanthatmodifiescertainofourbusinesspracticesinChina.Therectificationplanprovides,amongother
things,thatforlicensesofonlyour3Gand4GessentialChinesepatentsforbrandeddevicessoldforuseinChinastartingonJanuary1,2015(and
reportedtousinthethirdquarteroffiscal2015),wewillchargerunningroyaltiesatroyaltyratesof5%for3GCDMAorWCDMAdevices
(includingmultimode3G/4Gdevices)and3.5%for4GdevicesthatdonotimplementCDMAorWCDMA(including3-modeLTE-TDDdevices),in
eachcaseusingaroyaltybaseof65%ofthenetsellingprice.
Separateandapartfromlicensingmanufacturersofwirelessdevicesandnetworkequipment,wehaveenteredintocertainarrangementswith
competitorsofourQCTsegment,suchasBroadcomandMediaTek.AprincipalpurposeofthesearrangementsistoprovideourQCTsegmentand
thecounterpartiescertainfreedomofoperationwithrespecttoeachpartysintegratedcircuitsbusiness.Ineverycase,theseagreementsexpressly
reservetherightforQTLtoseekroyaltiesfromthecustomersofsuchintegratedcircuitsupplierswithrespecttosuchsupplierscustomerssales
ofCDMA-,WCDMA-andOFDMA-basedwirelessdevicesintowhichsuchsuppliersintegratedcircuitsareincorporated.
UpontheinitialdeploymentofOFDMA-basednetworks,theproductsimplementingsuchtechnologiesgenerallyhavebeenmultimodeand
implementCDMA-basedtechnologies.ThelicensesgrantedunderourexistingCDMAlicenseagreementsgenerallycovermultimode
CDMA/OFDMA(3G/4G)devices,andourlicenseesareobligatedtopayroyaltiesundertheirCDMAlicenseagreementsforsuchdevices.Further,
over210companies(includingHuawei,LG,Microsoft,Oppo,Samsung,Sony,vivo,XiaomiandZTE)haveroyalty-bearinglicensesunderour
patentportfolioforuseinLTEorotherOFDMA-basedproductsthatdonotimplementanyCDMA-basedstandards.
Sinceourfoundingin1985,wehavefocusedheavilyontechnologydevelopmentandinnovation.Theseeffortshaveresultedinaleading
intellectualpropertyportfoliorelatedto,amongotherthings,wirelesstechnology.WehaveanextensiveportfolioofUnitedStatesandforeign
patents,andwecontinuetopursuepatentapplicationsaroundtheworld.Ourpatentshavebroadcoverageinmanycountries,includingBrazil,
China,India,Japan,SouthKorea,TaiwanandcountriesinEuropeandelsewhere.Asubstantialportionofourpatentsandpatentapplicationsrelate
todigitalwirelesscommunicationstechnologies,includingpatentsthatareessentialormaybeimportanttothecommercialimplementationof
CDMA2000,WCDMA(UMTS),TD-SCDMA,TD-CDMA(TimeDivisionCDMA)andOFDMA/LTEproducts.Ourpatentportfolioisthemost
widelyandextensivelylicensedintheindustry,withover330licensees.Additionally,wehaveasubstantialpatentportfoliorelatedtokey
technologiesusedincommunicationsandotherdevicesand/orrelatedservices,someofwhichweredevelopedinindustrystandardsdevelopment
bodies.Theseincludecertainvideocodec,audiocodec,wirelessLAN,memoryinterfaces,wirelesspower,GPSandpositioning,broadcastand
streamingprotocols,andshortrangecommunicationfunctionalities,includingNFCandBluetooth.Ourpatentscoverawiderangeoftechnologies
acrosstheentirewirelesssystem,includingthedevice(handsetsandtablets)andnotjustwhatisembodiedinthechipsets.Overtheyears,a
numberofcompanieshavechallengedourpatentposition,butatthistime,companiesinthemobilecommunicationsindustrygenerally
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recognizethatanycompanyseekingtodevelop,manufactureand/orsellsubscriberunitsorinfrastructureequipmentthatuseCDMA-based,
and/orOFDMA-basedtechnologieswillrequirealicenseorotherrightstouseourpatents.
Wehavelicensedorotherwiseprovidedrightstouseourpatentstohundredsofcompaniesonindustry-acceptedterms.Unlikesomeother
companiesinourindustrythatholdbackcertainkeytechnologies,weoffercompaniessubstantiallyourentirepatentportfolioforuseincellular
subscriberdevicesandcellsiteinfrastructureequipment.Ourstrategytomakeourpatentedtechnologiesbroadlyavailablehasbeenacatalystfor
industrygrowth,helpingtoenableawiderangeofcompaniesofferingabroadarrayofwirelessproductsandfeatureswhileincreasingthe
capabilitiesofand/ordrivingdownaverageandlow-endsellingpricesfor3Ghandsetsandotherwirelessdevices.Bylicensingorotherwise
providingrightstouseourpatentstoawiderangeofequipmentmanufacturers,encouraginginnovativeapplications,supportingequipment
manufacturerswithintegratedchipsetandsoftwareproductsandfocusingonimprovingtheefficiencyoftheairlinkforwirelessoperators,wehave
helped3GCDMAevolveandgrowandreduceddevicepricing,allatafasterpacethanthe2GtechnologiessuchasGSMthatprecededit.
Standardsbodieshavebeeninformedthatweholdpatentsthatmightbeessentialforall3GstandardsthatarebasedonCDMA.Wehave
committedtosuchstandardsbodiesthatwewilloffertolicenseouressentialpatentsfortheseCDMAstandardsonafair,reasonableandnon-
discriminatorybasis.Wehavealsoinformedstandardsbodiesthatweholdpatentsthatmightbeessentialforcertainstandardsthatarebasedon
OFDM/OFDMAtechnology(e.g.,LTE,includingFDDandTDDversions)andhavecommittedtooffertolicenseouressentialpatentsforthese
OFDMAstandardsonafair,reasonableandnon-discriminatorybasis.Wehavemadesimilarcommitmentswithrespecttocertainother
technologiesimplementedinindustrystandards.
Ourlicenseagreementsalsomayprovideuswithrightstousecertainofourlicenseestechnologyandintellectualpropertytomanufacture
andsellcertaincomponents(e.g.,Application-SpecificIntegratedCircuits)andrelatedsoftware,subscriberunitsand/orinfrastructureequipment.
QSISegment.QSImakesstrategicinvestmentsthatarefocusedonopeningneworexpandingopportunitiesforourtechnologiesand
supportingthedesignandintroductionofnewproductsandservices(orenhancingexistingproductsorservices)forvoiceanddata
communications.Manyofthesestrategicinvestmentsareinearly-stagecompaniesinavarietyofindustries,including,butnotlimitedto,digital
media,e-commerce,healthcareandwearabledevices.Investmentsprimarilyincludenon-marketableequityinstruments,whichgenerallyare
recordedusingthecostmethodortheequitymethod,andconvertibledebtinstruments,whicharerecordedatfairvalue.QSIalsoheldwireless
spectrum,whichwassoldinthefirstquarteroffiscal2016foragainofapproximately$380million.Inaddition,QSIsegmentresultsinclude
revenuesandrelatedcostsassociatedwithdevelopmentcontractswithoneofourequitymethodinvestees.Aspartofourstrategicinvestment
activities,weintendtopursuevariousexitstrategiesforeachofourQSIinvestmentsintheforeseeablefuture.
OtherBusinesses.Nonreportablesegmentsincludeourmobilehealth,datacenter,smallcellandotherwirelesstechnologyandservice
initiatives.Ournonreportablesegmentsdevelopandsellproductsandservicesthatinclude,butarenotlimitedto:development,otherservicesand
relatedproductstoU.S.governmentagenciesandtheircontractorsproductsandservicesformobilehealthlicenseofchipsettechnologyand
productsfordatacenterssoftwareproductsandcontentandpush-to-talkenablementservicestowirelessoperatorsandproductsdesignedfor
implementationofsmallcellstoaddressthechallengeofmeetingtheincreaseddemandfordata.
AdditionalinformationregardingouroperatingsegmentsisprovidedinthisAnnualReportinNotestoConsolidatedFinancialStatements,
Note8.SegmentInformation.InformationregardingseasonalityisprovidedinthisAnnualReportinPartII,Item7.ManagementsDiscussion
andAnalysisofFinancialConditionandResultsofOperations,OurBusinessandOperatingSegmentsundertheheadingSeasonality.
StrategicRealignmentPlan
Inthefourthquarteroffiscal2015,weannouncedaStrategicRealignmentPlandesignedtoimproveexecution,enhancefinancialperformance
anddriveprofitablegrowthasweworktocreatesustainablelong-termvalueforstockholders.AspartofthisStrategicRealignmentPlan,among
otheractions,weimplementedacostreductionplan,whichincludedaseriesoftargetedreductionsacrossourbusinesses,particularlyinQCT,and
areductiontoannualshare-basedcompensationgrants.AdditionalinformationregardingourStrategicRealignmentPlanisprovidedinthis
AnnualReportinManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperation,Fiscal2016OverviewandNotesto
ConsolidatedFinancialStatements,Note10.StrategicRealignmentPlan.
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Acquisitions
InJanuary2016,weannouncedthatwehadreachedanagreementwithTDKCorporationtoformajointventure,underthenameRF360
HoldingsSingaporePte.Ltd.,toenabledeliveryofRFFEmodulesandRFfiltersintofullyintegratedproductsformobiledevicesandIoT
applications,amongothers.Thejointventurewillinitiallybeowned51%byusand49%byTDK.Certainintellectualproperty,patentsandfilter
andmoduledesignandmanufacturingassetswillbecarvedoutofexistingTDKbusinessesandbeacquiredbythejointventure,withcertain
assetsacquiredbyus.Thepurchasepriceofourinterestinthejointventureandtheassetstobetransferredtousis$1.2billion,tobeadjustedfor
workingcapital,outstandingindebtednessandcertaincapitalexpenditures,amongotherthings.Additionally,wehavetheoptiontoacquire(and
TDKhasanoptiontosell)TDKsinterestinthejointventurefor$1.15billion30monthsaftertheclosingdate.TDKwillbeentitledtouptoatotal
of$200millioninpaymentsbasedonsalesofRFfilterfunctionsoverthethree-yearperiodaftertheclosingdate,whichisasubstituteforandin
lieuofanyrightofTDKtoreceiveanyprofitsharing,distributions,dividendsorotherpaymentsofanykindornature.Thetransactionissubject
toreceiptofregulatoryapprovalsandotherclosingconditionsandisexpectedtocloseinearlycalendar2017.
OnOctober27,2016,weannouncedadefinitiveagreementunderwhichQualcommRiverHoldings,B.V.,anindirect,whollyownedsubsidiary
ofQualcommIncorporated,willacquireNXPSemiconductorsN.V.Pursuanttothedefinitiveagreement,QualcommRiverHoldingswillcommencea
tenderoffertoacquirealloftheissuedandoutstandingcommonsharesofNXPfor$110pershareincash,forestimatedtotalcashconsiderationof
$38billion.NXPisaleaderinhigh-performance,mixed-signalsemiconductorelectronicsinautomotive,broad-basedmicrocontrollers,secure
identification,networkprocessingandRFpowerproducts.
Thetransactionisexpectedtoclosebytheendofcalendar2017andissubjecttoreceiptofregulatoryapprovalsinvariousjurisdictionsand
otherclosingconditions,includingthetenderofspecifiedpercentages(whichvaryfrom70%to95%basedoncertaincircumstancesasprovidedin
thedefinitiveagreement)oftheissuedandoutstandingcommonsharesofNXPintheoffer.AnExtraordinaryGeneralMeetingofNXPs
shareholderswillbeconvenedinconnectionwiththeoffertoadopt,amongotherthings,certainresolutionsrelatingtothetransaction.Thetender
offerisnotsubjecttoanyfinancingconditionhowever,weintendtofundthetransactionwithcashheldbyforeignentitiesandnewdebt.Asa
result,wesecured$13.6billionincommittedfinancinginconnectionwithsigningthedefinitiveagreement.
QualcommRiverHoldingsandNXPmayterminatethedefinitiveagreementundercertaincircumstances.Ifthedefinitiveagreementis
terminatedbyNXPincertaincircumstances,includingterminationbyNXPtoenterintoasuperiorproposalforanalternativeacquisition
transactionoraterminationfollowingachangeofrecommendationbytheNXPboardofdirectors,NXPwillberequiredtopayQualcommRiver
Holdingsaterminationfeeof$1.25billion.IfthedefinitiveagreementisterminatedbyQualcommRiverHoldingsundercertaincircumstances
involvingthefailuretoobtaintherequiredregulatoryapprovalsorthefailureofNXPtocompletecertainpre-closingreorganizationstepsinall
materialrespects,QualcommRiverHoldingswillberequiredtopayNXPaterminationfeeof$2.0billion.
CorporateStructure
Weoperateourbusinessesthroughourparentcompany,QUALCOMMIncorporated,andmultipledirectandindirectsubsidiaries.Wehave
developedourcorporatestructureinordertoaddressvariouslegal,regulatory,tax,contractualcompliance,operationsandothermatters.
Substantiallyallofourproductsandservicesbusinesses,includingQCT,andsubstantiallyallofourengineering,researchanddevelopment
functions,areoperatedbyQUALCOMMTechnologies,Inc.(QTI),awholly-ownedsubsidiaryofQUALCOMMIncorporated,andQTIs
subsidiaries.QTLisoperatedbyQUALCOMMIncorporated,whichownsthevastmajorityofourpatentportfolio.NeitherQTInoranyofits
subsidiarieshasanyright,powerorauthoritytograntanylicensesorotherrightsunderortoanypatentsownedbyQUALCOMMIncorporated.
RevenueConcentrations,SignificantCustomersandGeographicalInformation
Consolidatedrevenuesfrominternationalcustomersandlicenseesasapercentageoftotalrevenueswere98%,99%and99%infiscal2016,
2015and2014,respectively.Duringfiscal2016,57%,17%and12%ofourrevenueswerefromcustomersandlicenseesbasedinChina(including
HongKong),SouthKoreaandTaiwan,respectively,comparedto53%,16%and13%duringfiscal2015,respectively,and50%,23%and11%during
fiscal2014,respectively.Wereportrevenuesfromexternalcustomersbycountrybasedonthelocationtowhichourproductsorservicesare
delivered,whichforQCTisgenerallythecountryinwhichourcustomersmanufacturetheirproducts,orforlicensingrevenues,theinvoiced
addressesofourlicensees.Asaresult,therevenuesbycountrypresentedhereinarenotnecessarilyindicativeofeitherthecountryinwhichthe
devicescontainingourproductsand/orintellectualpropertyareultimatelysoldtoconsumersorthecountryinwhichthecompaniesthatsellthe
devicesareheadquartered.Forexample,Chinarevenuescouldincluderevenuesrelatedtoshipmentsofintegratedcircuitstoacompanythatis
headquarteredinSouthKoreabutthatmanufacturesdevicesinChina,
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whichdevicesarethensoldtoconsumersinEuropeand/ortheUnitedStates.AdditionalgeographicinformationisprovidedinthisAnnualReport
inNotestoConsolidatedFinancialStatements,Note8.SegmentInformation.
Asmallnumberofcustomers/licenseeshistoricallyhaveaccountedforasignificantportionofourconsolidatedrevenues.Infiscal2016,2015
and2014,revenuesfromSamsungElectronicsandfromHonHaiPrecisionIndustryCo.,Ltd./Foxconn,itsaffiliatesandothersupplierstoApple
Inc.eachcomprisedmorethan10%ofconsolidatedrevenues.
ResearchandDevelopment
Thecommunicationsindustryischaracterizedbyrapidtechnologicalchange,evolvingindustrystandardsandfrequentnewproduct
introductions,requiringacontinuousefforttoenhanceexistingproductsandtechnologiesandtodevelopnewproductsandtechnologies.We
havesignificantengineeringresources,includingengineerswithsubstantialexpertiseinCDMA,OFDMAandabroadrangeofothertechnologies.
Usingtheseengineeringresources,weexpecttocontinuetoinvestinresearchanddevelopmentinavarietyofwaysinanefforttoextendthe
demandforourproductsandservices,includingcontinuingthedevelopmentofCDMA,OFDMAandothertechnologies,developingalternative
technologiesforcertainspecializedapplications,participatingintheformulationofnewvoiceanddatacommunicationstandardsandtechnologies
andassistingindeployingdigitalvoiceanddatacommunicationsnetworksaroundtheworld.Ourresearchanddevelopmentteamhasa
demonstratedtrackrecordofinnovationinvoiceanddatacommunicationtechnologiesandapplicationprocessortechnology,amongothers.Our
researchanddevelopmentexpendituresinfiscal2016,2015and2014totaledapproximately$5.2billion,$5.5billionand$5.5billion,respectively.
Wecontinuetoinvestsignificantresourcestowardsadvancementsin4GOFDMA-basedtechnologies(includingLTE)and5G-based
technologies.Wealsomakeacquisitionstomeetcertaintechnologyneeds,toobtaindevelopmentresourcesortopursuenewbusiness
opportunities.
Wemakeinvestmentstoprovideourintegratedcircuitcustomerswithchipsetsdesignedonleading-edgetechnologynodesthatcombine
multipletechnologiesforuseinconsumerdevices(e.g.,smartphones,tablets,laptops),consumerelectronicsandotherproducts(e.g.,access
pointsandrouters,datacardsandinfrastructureequipment).Inadditionto3Gand4GLTEtechnologies,ourchipsetssupportotherwirelessand
wiredconnectivitytechnologies,includingWLAN,Bluetooth,Ethernet,GPS,GLONASS,BeiDouandPowerlinecommunication.Ourintegrated
chipsetsoftenincludemultipletechnologies,includingadvancedmultimodemodems,applicationprocessorsandgraphicsengines,aswellasthe
toolstoconnectthesediversetechnologies.WecontinuetosupportAndroid,Windowsandothermobileclientsoftwareenvironmentsinour
chipsets.
Wedeveloponourown,andwithourpartners,innovationsthatareintegratedintoourproductportfoliotofurtherexpandtheopportunityfor
wirelesscommunicationsandenhancethevalueofourproductsandservices.Theseinnovationsareexpectedtoenableourcustomerstoimprove
theperformanceorvalueoftheirexistingservices,offertheseservicesmoreaffordablyandintroducerevenue-generatingbroadbanddataservices
aheadoftheircompetition.
Wehaveresearchanddevelopmentcentersinvariouslocationsthroughouttheworldthatsupportourglobaldevelopmentactivitiesand
ongoingeffortstodevelopand/oradvance4GOFDMA,5Gandabroadrangeofothertechnologies.Wecontinuetouseoursubstantial
engineeringresourcesandexpertisetodevelopnewtechnologies,applicationsandservicesandmakethemavailabletolicenseestohelpgrowthe
communicationsindustryandgenerateneworexpandedlicensingopportunities.
Wealsomakeinvestmentsinopportunitiesthatleverageourexistingtechnicalandbusinessexpertisetodeploynewandexpandedproduct
areas,suchasRFFE,andenterintoadjacentindustrysegments,suchasproductsforautomotive,theIoT,includingtheconnectedhome,smart
citiesandwearables,datacenter,networking,mobilecomputing,mobilehealthandmachinelearning,includingrobotics,amongothers.
SalesandMarketing
SalesandmarketingactivitiesofouroperatingsegmentsarediscussedunderOperatingSegments.Othermarketingactivitiesincludepublic
relations,advertising,digitalmarketingandsocialmedia,participationintechnicalconferencesandtradeshows,developmentofbusinesscases
andwhitepapers,competitiveanalyses,industryintelligenceandothermarketingprograms,suchasmarketingdevelopmentfundswithour
customers.OurCorporateMarketingdepartmentprovidescompanyinformationonourInternetsiteandthroughotherchannelsregardingour
products,strategiesandtechnologytoindustryanalystsandmedia.
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Competition
CompetitionfacedbyouroperatingsegmentsisdiscussedunderOperatingSegments.Competitioninthecommunicationsindustry
throughouttheworldcontinuestoincreaseatarapidpaceasconsumers,businessesandgovernmentsrealizethepotentialofwireless
communicationsproductsandservices.Wehavefacilitatedcompetitioninthewirelesscommunicationsindustrybylicensingourtechnologiesto,
andthereforeenabling,alargenumberofmanufacturers.Althoughwehaveattainedasignificantpositionintheindustry,manyofourcurrentand
potentialcompetitorsmayhaveadvantagesoverusthatinclude,amongothers:motivationbyourcustomersincertaincircumstancestoutilize
theirowninternally-developedintegratedcircuitproducts,touseourcompetitorsintegratedcircuitproducts,ortochoosealternative
technologieslowercoststructuresand/orawillingnessandabilitytoacceptlowerpricesandlowerornegativemarginsfortheirproducts,
particularlyinChinaforeigngovernmentsupportofothertechnologiesorcompetitorsbetterknownbrandnamesownershipandcontrolof
manufacturingfacilitiesandgreaterexpertiseinmanufacturingprocessesmoreextensiverelationshipswithlocaldistributioncompaniesand
originalequipmentmanufacturersinemerginggeographicregions(suchasChina)and/oramoreestablishedpresenceincertainregions.These
relationshipsmayaffectcustomersdecisionstopurchaseproductsorlicensetechnologyfromus.Accordingly,newcompetitorsoralliances
amongcompetitorscouldemergeandrapidlyacquiresignificantmarketpositionstoourdetriment.
Weexpectcompetitiontoincreaseasourcurrentcompetitorsexpandtheirproductofferingsandintroducenewtechnologiesandservicesin
thefutureandasadditionalcompaniescompetewithourproductsorservicesbasedon3G,4Gorothertechnologies.Althoughweintendto
continuetomakesubstantialinvestmentsindevelopingnewproductsandtechnologiesandimprovingexistingproductsandtechnologies,our
competitorsmayintroducealternativeproducts,servicesortechnologiesthatthreatenourbusiness.Itisalsopossiblethatthepriceswechargefor
ourproductsandservicesmaycontinuetodeclineascompetitioncontinuestointensify.
CorporateResponsibilityandSustainability
Westrivetobetterourlocalandglobalcommunitiesthroughethicalbusinesspractices,sociallyempoweringtechnologyapplications,
educationalandenvironmentalprogramsandemployeediversityandvolunteerism.
OurGovernance.Weaimtodemonstrateaccountability,transparency,integrityandethicalbusinesspracticesthroughoutouroperations
andinteractionswithourstakeholders.
OurProducts.Westrivetomeetorexceedindustrystandardsforproductresponsibilityandsuppliermanagement.
OurWorkplace.Weendeavortoprovideasafeandhealthyworkenvironmentwherediversityisembracedandvariousopportunitiesfor
training,growthandadvancementareencouragedforallemployees.
OurCommunity.Wehavestrategicrelationshipswithawiderangeoflocalorganizationsandprogramsthatdevelopandstrengthen
communitiesworldwide.
OurEnvironment.Weaimtoexpandouroperationswhileminimizingourcarbonfootprint,conservingwaterandreducingwaste.
QualcommWirelessReach.Weinvestinstrategicprogramsthatfosterentrepreneurship,aidinpublicsafety,enhancedeliveryofhealth
care,enrichteachingandlearningandimproveenvironmentalsustainabilitythroughtheuseofadvancedwirelesstechnologies.
Employees
AtSeptember25,2016,weemployedapproximately30,500full-time,part-timeandtemporaryemployees.Duringfiscal2016,thenumberof
employeesdecreasedbyapproximately2,500primarilyduetoactionsinitiatedundertheStrategicRealignmentPlan.
AvailableInformation
OurInternetaddressiswww.qualcomm.com.Therewemakeavailable,freeofcharge,ourannualreportonForm10-K,quarterlyreportson
Form10-Q,currentreportsonForm8-Kandanyamendmentstothosereports,assoonasreasonablypracticableafterweelectronicallyfilesuch
materialwith,orfurnishitto,theSecuritiesandExchangeCommission(SEC).WealsomakeavailableonourInternetsitepublicfinancial
informationforwhichareportisnotrequiredtobefiledwithorfurnishedtotheSEC.OurSECreportsandotherfinancialinformationcanbe
accessedthroughtheinvestorrelationssectionofourInternetsite.TheinformationfoundonourInternetsiteisnotpartofthisoranyotherreport
wefilewithorfurnishtotheSEC.
15
EXHIBIT 31
PAGE 548

(N.Y. Bar No. 1475722)
3 825 Eighth Avenue
New York, NY 10019
4 Telephone: (212) 474-1000
Facsimile: (212) 474-3700
5
6 (Ill. Bar No. 6209623)
Telephone: (312) 705-7400
9 Facsimile: (312) 705-7401
11 JONES DAY
Telephone: (858) 314-1200
13 Facsimile: (858) 345-3178
15
19 Plaintiff, DECLARATION OF ALEX
ROGERS IN SUPPORT OF
20 v. PLAINTIFF QUALCOMM
23 WISTRON CORPORATION, Courtroom: 14B
24 Defendants. Judge: Hon. William Q. Hayes
25 No Oral Argument Unless Requested
by the Court.
26
28
Case No. 17-cv-1010 WQH JMA
Declaration of Alex Rogers
1 I, Alex Rogers, declare as follows:

2 1. I am the Executive Vice President and President of Qualcomm
3 Technology Licensing (QTL), a division of Qualcomm Incorporated
4 (Qualcomm). QTL is the business segment of Qualcomm that grants patent
5 licenses and provides rights to use portions of Qualcomms intellectual property
6 portfolio. I have been employed by Qualcomm since 2001. I have held my current
7 position, in which I oversee Qualcomms licensing business, since 2016. Prior to
8 becoming the Executive Vice President and President of QTL, I held various
9 positions in Qualcomms Corporate Legal department, including the position of
10 Deputy General Counsel.
11 2. Through my work in the Corporate Legal department and now as the
12 Executive Vice President and President of QTL, I am familiar with Qualcomms
13 licensing practices. I have actively participated in the negotiation of license
14 agreements on behalf of Qualcomm, including in recent negotiations with Apple
15 Inc. (Apple).
16 3. In my current position, I oversee Qualcomms business relationship
17 with each licensee. My work at Qualcomm over the past 16 years has required
18 familiarity with Qualcomms various agreements with Qualcomm licensees. As a
19 result, I am familiar with the license agreements Qualcomm has entered into during
20 my tenure at the company, as well as certain of the active license agreements that
21 were entered into prior to my employment at Qualcomm.
22 4. The contents of this declaration are true and correct to the best of my
23 knowledge, information, and belief, and are based on my personal knowledge or, as
24 applicable, on my review of Qualcomm records. If called upon as a witness in this
25 action, I could and would competently testify thereto.
26 Qualcomms Relationship with Defendants
27 5. Compal Electronics Inc., Hon Hai Precision Industry Co. and FIH
28 Mobile Ltd. (together, Foxconn), Wistron Corporation, and Pegatron Corporation
2 Declaration of Alex Rogers
1 (collectively the Defendants), have entered into license agreements with

2 Qualcomm. (Lavely Decl., Exhibits 1-5.) The license agreements provide
3 Defendants with the right to make, use, and sell certain cellular devices that practice
4 certain Qualcomm intellectual property, generally including cellular standard-
5 essential patents (cellular SEPs), non-cellular SEPs, and non-standard-essential
6 patents (NEPs).
7 Qualcomms Relationship with Apple
8 6. Apples cellular products, including the iPhone and iPad, are
9 manufactured by Defendants under their license agreements with Qualcomm. It is
10 through this arrangement that Apple receives the right to practice certain
11 Qualcomm patents. Apple has never entered into a direct license agreement with
12 Qualcomm. Instead, the Defendants make Apple products subject to their license
13 agreements with Qualcomm and pay royalties to Qualcomm pursuant to those
14 agreements.
15 Qualcomms Licensing Business
16 7. Research and development is critical to Qualcomms licensing
17 business. In order to remain a leader in this industry, it is essential for Qualcomm
18 to commit significant resources and funding to R&D of new technologies. This is
19 especially true given the changing landscape of companies seeking to innovate in
20 the field of wireless technology. It is Qualcomms ongoing investment in R&D that
21 allows it to invent the cellular technologies critical to the function of cellular
22 networks and devices.
23 8. Qualcomm has spent decades in relationships with numerous licensees
24 around the world. In order to develop goodwill, Qualcomm strives to treat
25 similarly situated licensees fairly and maintain consistency in its licensing program.
26 9. Qualcomms licensing business depends on its ability to license its
27 tens of thousands of patents to cellular manufacturers that use its valuable
28 technology in return for royalties. Qualcomm has hundreds of other licensees in
1 addition to Defendants. Qualcomms other licensees include competitors of Apple

2 and Defendants. By refusing to pay royalties for Qualcomms licensed technology,
3 Defendants (and Apple) have created a significant competitive imbalance. Their
4 competitors are paying to use Qualcomms valuable intellectual property under
5 their respective license agreements, while Apple and Defendants are not.
6 10. If Defendants non-payment of royalties continues, other licensees
7 may use Defendants non-payment as leverage to improperly argue that they may
8 also decline to pay under their respective agreements, or use the non-payment as
9 leverage in renegotiations, so long as Apple and Defendants continue to refuse to
10 pay. In this way, Apples and Defendants actions threaten to undermine
11 Qualcomms licensing business beyond the scope of the dispute with Apple.
12 11. Defendants continued non-payment of royalties also may harm
13 Qualcomms ability to enter into new agreements. Prospective licensees are aware
14 of competitors practices with respect to the payment of royalties for intellectual
15 property rights. If a major competitor is not paying at all, particularly despite the
16 existence of a valid agreement, a prospective licensee could claim it is
17 disadvantageous to sign a license agreement with Qualcomm.
18 Pursuant to 28 U.S.C. 1746, I declare under penalty of perjury that the
19 foregoing is true and correct and that I executed this declaration on May 24, 2017 in
20 Brussels, Belgium.
21
22
Alex Rogers
23
24
25
26
27
28

(N.Y. Bar No. 1475722)
3 825 Eighth Avenue
New York, NY 10019
4 Telephone: (212) 474-1000
Facsimile: (212) 474-3700
5
6 (Ill. Bar No. 6209623)
Telephone: (312) 705-7400
9 Facsimile: (312) 705-7401
11 JONES DAY
Telephone: (858) 314-1200
13 Facsimile: (858) 345-3178
15
UNITED STATES DISTRICT COURT
16
SOUTHERN DISTRICT OF CALIFORNIA
17
QUALCOMM INCORPORATED, Case No. 3:17-CV-01010-WQH-JMA
18
Plaintiff, REDACTED DECLARATION OF
19 ABBASEH SAMIMI IN
v. SUPPORT OF
20 PLAINTIFF QUALCOMM
COMPAL ELECTRONICS, INC., FIH INCORPORATEDS MOTION
21 FOR A PRELIMINARY
Defendants. Courtroom: 14B
24
25
26 by the Court.
28
Declaration of Abbaseh Samimi
1 I, Abbaseh Samimi, declare as follows:

2 1. I am Vice President, Strategic Market Analysis and Contracts at
3 Qualcomm Technology Licensing (QTL), a division of Qualcomm Incorporated
4 (Qualcomm). QTL is the business segment of Qualcomm that grants licenses and
5 provides rights to use portions of Qualcomms intellectual property portfolio. I
6 have been employed by Qualcomm since 1996. I have held my current position
7 since 2007.
8 2. For more than twenty years, I have overseen Qualcomms license
9 compliance group. Qualcomms license compliance group is responsible for
10 reviewing licensee royalty reports, overseeing royalty audits of licensees,
11 confirming complete royalty payment by licensees, and handling all regular
12 correspondence with licensees. Following the receipt and review of licensee
13 royalty reports, the compliance group also works with Qualcomms finance group
14 to invoice licensees. The compliance group tracks the royalty payment compliance
15 for hundreds of Qualcomm licensees, including Compal Electronics Inc.
16 (Compal), FIH Mobile Ltd. and Hon Hai Precision Industry Co., Ltd. (together
17 Foxconn), Wistron Corporation (Wistron) and Pegatron Corporation
18 (Pegatron) (collectively, Defendants). The compliance group regularly
19 communicates with each of the Defendants and Qualcomms other licensees. I
20 receive regular notifications regarding licensee royalty reporting, payment
21 compliance, and correspondence.
22 3. In around 2001, I formed Qualcomms contracts group and have
23 overseen the group since that date. The contracts group tracks each license
24 agreement entered into by Qualcomm, as well as any amendments or sublicense
25 agreements related to Qualcomms license agreements. The contracts group also
26 tracks the licensing terms for each of Qualcomms licensees. I receive notification
27 upon entry of any new license agreements, sublicense agreements, or amendments.
2 Declaration of Abbaseh Samimi
4 Defendants License Agreements with Qualcomm
5 5. Qualcomm entered into a license agreement with Compal on February
6 10, 2000. The parties have executed various amendments to the license agreement,
7 including on March 12, 2002; November 4, 2002; September 30, 2005; February 1,
8 2006; June 22, 2007; April 15, 2008; November 8, 2011; and February 27, 2014.
9 (See Lavely Decl., Exhibit (Ex. or Exs.) 1.)
10 6. Qualcomm entered into a license agreement with FIH Mobile Ltd.
11 (formerly Foxconn International Holdings Ltd.) on October 18, 2005. (Ex. 2.) Hon
12 Hai Precision Industry Co., Ltd. (Hon Hai) also signed the agreement with
13 respect to two sections. (Id.) Also on October 18, 2005, Qualcomm entered into a
14 Request for Consent to Sublicense with Hon Hai and FIH Mobile Ltd., which made
15 Hon Hai a sublicensee pursuant to the terms of the license agreement. (Ex. 3.) The
16 parties have executed various amendments to the license agreement, including on
17 March 27, 2006; November 29, 2007 (since terminated); April 14, 2009; and
18 September 24, 2012. (Ex. 2.)
19 7. Qualcomm entered into a license agreement with Wistron on May 23,
20 2007. (Ex. 4.) The parties have not executed any amendments to the license
21 agreement.
22 8. Qualcomm entered into a license agreement with Pegatron on April 29,
23 2010. The parties have executed various amendments to the license agreement,
24 including on June 1, 2010 (two amendments); June 30, 2010; and May 23, 2011
25 (since terminated). (Ex. 5.)
26 9. Compal began paying royalties under its license agreement in 2002.
27 Compal did not start manufacturing and paying royalties on Apple Inc. (Apple)
28 products under its license agreement until 2014.
1 10. Foxconn began paying royalties under its license agreement in 2005.
2 Foxconn did not start manufacturing and paying royalties on Apple products under
3 its license agreement until 2008.
4 11. Pegatron began paying royalties under its license agreement in 2010.
5 Pegatron did not start manufacturing and paying royalties on Apple products under
7 12. Wistron began paying royalties under its license agreement in 2013.
8 Wistron did not start manufacturing and paying royalties on Apple products under
10 13. The royalty rate in each Defendants license agreement has remained
11 the same both before and after each Defendant began manufacturing Apple
12 products.
13 14. In 2015 and 2016, Defendants combined royalty payments for Apple
14 products averaged approximately per quarter.
15 15. Prior to Q4 2016, each Defendant made regular royalty payments to
16 Qualcomm on Apple and non-Apple devices. Each Defendant has continued to
17 make royalty payments to Qualcomm under its license agreement for non-Apple
18 products, including for Q4 2016 and Q1 2017.
19 Defendants Failure To Pay Royalties
20 16. In a letter dated February 3, 2017, Apple told Qualcomm that it was
21 withholding a total of approximately $963 million in payments to the Defendants
22 for the royalties they owed Qualcomm for Q4 2016. (Ex. 7, at 1.) Apple stated that
23 it withheld this amount based on the amounts at issue in a separate dispute
24 regarding the Business Cooperation and Patent Agreement between Apple and
25 Qualcomm. (Id.) Aside from the approximately $963 million withheld, Apple paid
26 Defendants the amounts owed for reported royalties for Q4 2016. (Id.)
27 17. Foxconns Q4 2016 royalty reports certified that it owed
28 to Qualcomm for Apple products ( for iPhones
1 and for iPads). (Exs. 8-10.) Qualcomm invoiced Foxconn for the
2 reported royalties. However, Foxconn only paid Qualcomm in
3 royalties on Apple products for Q4 2016 ( for iPhones and
4 for iPads). Foxconn stated that it had received roughly one-third of
5 the royalties due from Apple and that the remaining amount would not be issued.
6 (Ex. 11.) Qualcomm notified Foxconn of its non-compliance and reminded
7 Foxconn that it must fulfill its payment obligations. Foxconn paid the full Q4 2016
8 royalties that it reported for non-Apple products.
9 18. Qualcomm received Pegatrons Q4 2016 royalty report on January 22,
10 2017. Pegatrons Q4 2016 royalty report showed that it owed to
11 Qualcomm for Apple iPhones. Pegatrons total royalty amount owed was
12 calculated by summing the individual amounts listed in Pegatrons report. (Ex. 12.)
13 Qualcomm invoiced Pegatron for that amount. However, Pegatron only paid
14 Qualcomm in iPhone royalties for Q4 2016. Qualcomm notified
15 Pegatron of its non-compliance and reminded Pegatron that it must fulfill its
16 payment obligations. Pegatron paid the full Q4 2016 royalties that it reported for
17 non-Apple products.
18 19. Wistron submitted its Q4 2016 royalty report two weeks late, and the
19 report was missing the required sales data for Apple products. Instead, the report
20 simply showed that Wistron owed in royalties for Apple iPhones.
21 (Ex. 13.) According to Apples February 3, 2017 letter, however, Wistron owed
22 Qualcomm in royalties for Q4 2016. (Ex. 7.) But Wistron only paid
23 Qualcomm in iPhone royalties for Q4 2016. Qualcomm notified
24 Wistron of its non-compliance and reminded Wistron that it must fulfill its payment
25 and reporting obligations. Wistron told Qualcomm that the information it sent was
26 all that its customer allowed [Wistron] to provide. (Ex. 14.) Wistron paid the
27 full Q4 2016 royalties that it reported for non-Apple products.
28 20. Compals Q4 2016 royalty report was received by Qualcomm on
1 January 25, 2017, and Compal paid the full amount it reported for Q4 2016
2 royalties for Apple and non-Apple products. (Ex. 15.) According to Apples
3 February 3, 2017 letter, Compal received nearly full payment from Apple for Q4
4 2016. (Ex. 7.)
5 21. On April 25, 2017, Apple notified Qualcomm that it would not pay
6 any funds to Defendants for royalties due to Qualcomm for Q1 2017, and will not
7 be paying any funds to Defendants until court and antitrust agency matters are
8 resolved. (Ex. 16.)
9 22. On April 19, 2017, Qualcomm received Compals Q1 2017 royalty
10 report for Apple products. Compals Q1 2017 royalty report showed that it owed
11 in royalties to Qualcomm for Apple iPads. (Ex. 17.) But, on April 27,
12 2017, Qualcomm received an email from Compal stating: Our customer [Apple]
13 has recently formally requested [C]ompal stop the royalty payment to [Q]ualcomm
14 that [is] associated to their business until legal action is completed. (Ex. 18.) On
15 May 3, 2017, Compal told Qualcomm that Apple will not be transmitting funds to
16 [Compal] for the [Q1 2017] quarterly royalty payment to Qualcomm, so Compal
17 will only submit non-Apples report/payment. (Ex. 19.) Qualcomm reminded
18 Compal that it must comply with its obligations under its license agreement by
19 paying royalties on both Apple and non-Apple products. Compal was required to
20 remit Q1 2017 royalty payments by . Compal has not paid any
21 royalties to Qualcomm for Apple products for Q1 2017. Compal paid the full Q1
22 2017 royalties that it reported for non-Apple products.
23 23. Foxconns Q1 2017 royalty reports certified that it owed
24 in royalties to Qualcomm for Apple products (
25 for iPhones and for iPads). (Exs. 20-22.) But, on April 26, 2017,
26 Qualcomm received an email from Foxconn stating: Still wa[i]ting for funds from
27 customer [Apple], I have no idea when [Foxconn] can release pa[y]ment to you.
28 (Ex. 23.) On a subsequent call, Foxconn informed Qualcomm that its Apple royalty
1 payments are on hold, and that Apple had instructed Foxconns legal team to
2 contact Apples legal team. Qualcomm notified Foxconn of its non-compliance and
3 reminded Foxconn that it must fulfill its payment obligations. Foxconn was
4 required to remit Q1 2017 royalty payments by . Foxconn has not
5 paid any royalties to Qualcomm for Apple products for Q1 2017.1 Foxconn has
6 paid a portion of its reported Q1 2017 royalties for non-Apple products and has
7 informed Qualcomm that it will make the remaining payments in the immediate
8 future.
9 24. Qualcomm received Pegatrons Q1 2017 royalty report for Apple
10 products on April 15, 2017, and it showed that Pegatron owed in
11 royalties to Qualcomm for Apple iPhones. Pegatrons total royalty amount owed
12 was calculated by summing the individual amounts listed in Pegatrons report. (Ex.
13 24.) Pegatron was required to remit Q1 2017 royalty payments by ,
14 but Pegatron has not paid any royalties to Qualcomm for Apple products for Q1
15 2017. Qualcomm notified Pegatron of its non-compliance and reminded Pegatron
16 that it must fulfill its payment obligations. Pegatron paid the full Q1 2017 royalties
17 that it reported for non-Apple products.
18 25. As of the date of this Declaration, Qualcomm has not received a
19 royalty report from Wistron for Apple products for Q1 2017, despite Qualcomms
20 repeated requests for the report. Wistron was required to remit Q1 2017 royalty
21 payments by . Wistron has not paid any royalties to Qualcomm for
22 Apple products for Q1 2017. Wistron paid the full Q1 2017 royalties that it
23 reported for non-Apple products.
24
25
26
27 1
Foxconn CMMSG Industria De Electronicos LTDA, which I understand is
not a defendant in this action, paid approximately in royalties under a
28 separate license agreement.

(N.Y. Bar No. 1475722)
3 825 Eighth Avenue
New York, NY 10019
4 Telephone: (212) 474-1000
Facsimile: (212) 474-3700
5
6 (Ill. Bar No. 6209623)
Telephone: (312) 705-7400
9 Facsimile: (312) 705-7401
11 JONES DAY
Telephone: (858) 314-1200
13 Facsimile: (858) 345-3178
15
19 Plaintiff, DECLARATION OF JAMES J.
CATHEY IN SUPPORT OF
20 v. PLAINTIFF QUALCOMM
Courtroom: 14B
24 Defendants.
25
26 by the Court.
28
Declaration of James J. Cathey
1 I, James J. Cathey, declare as follows:

2 1. I am Senior Vice President and President of Asia Pacific & India at
3 Qualcomm Technologies Inc. (QTI), a subsidiary of Qualcomm Incorporated
4 (Qualcomm). QTI operates substantially all of the products and services
5 businesses owned by Qualcomm Incorporated, including Qualcomm CDMA
6 Technologies (QCT), and substantially all of its engineering, research, and
7 development functions. I have been employed by Qualcomm since 2006. I have
8 held my current title since 2016.
9 2. In my role at QTI, I oversee all of QTIs sales and customer relations
10 for Qualcomms Asia Pacific and India region (which includes Korea, Japan,
11 Taiwan, and Indonesia, among many other countries). As a result, I frequently
12 meet with, or otherwise communicate with, QTIs customers and potential
13 customers across the region. For many years, I have had long-standing
14 relationships with numerous cellular device manufacturers, including Compal
15 Electronics Inc., Hon Hai Precision Industry Co. and/or FIH Mobile Ltd. (together,
16 Foxconn), Wistron Corporation, and Pegatron Corporation (collectively,
17 Defendants). I regularly interact with representatives from each Defendant.
22 Apples Agreement To Indemnify Defendants
23 4. I am aware that each Defendant has entered into a license agreement
24 with Qualcomm. Under their respective license agreements, the Defendants are
25 required to pay Qualcomm royalties for the manufacture and sale of cellular
26 products.
27 5. I am also aware that each Defendant recently stopped paying the
28 royalties owed to Qualcomm under its license agreement for the sale of Apple, Inc.
2 Declaration of James J. Cathey
1 (Apple) products.
2 6. During a meeting in Taiwan in late February 2017, a Foxconn
3 representative informed me that Apple agreed to indemnify Foxconn for any claims
4 arising from Foxconns failure to honor its obligations under its license agreement
5 with Qualcomm. During a teleconference in April 2017, a Compal representative
6 also informed me that Apple promised similar indemnification to Compal. In early
7 May 2017, during another trip to Taiwan, a Wistron representative also informed
8 me that Apple made a similar indemnification promise to Wistron.
9 7. By early May 2017, representatives from Foxconn, Wistron and
10 Compal had informed me that Apple was instructing each such Defendant not
11 to make royalty payments to Qualcomm related to the sale of Apple products.
12
13 Pursuant to 28 U.S.C. 1746, I declare under penalty of perjury that the
14 foregoing is true and correct that I executed this declaration on May 24, 2017
15 in Tokyo, Japan.
16
17
18
19
20
21
22
23
24
25
26
27
28
3 Declaration of James J. Cathey
1 CERTIFICATE OF SERVICE
2 The undersigned hereby certifies that a true and correct copy of the foregoing
3 Notice of Motion and Motion for Preliminary Injunction, Memorandum of Points
4 and Authorities in Support, and accompanying declarations and exhibits, have been
5 served on May 24, 2017, to all counsel of record who are deemed to have consented
6 to electronic service via the Courts CM/ECF system per Civil Local Rule 5.4.
7 In addition, a true and correct copy of the Notice of Motion and Motion for
8 Preliminary Injunction, Unredacted Memorandum of Points and Authorities in
9 Support, and accompanying declarations and exhibits, have been served on May 24,
10 2017, to all defendants identified below by depositing true copies of the same in
11 postage prepaid, Priority Mail Express wrappers in a depository under the exclusive
12 care and control of the United States Postal Service, located within the State, City
13 and County of New York, to wit: the James A Farley Post Office, 421 Eighth
14 Avenue, New York, NY 10001.
15 I certify under penalty of perjury that the foregoing is true and correct.
16 Executed May 24, 2017.
17
Hon Hai Precision Industry Co., Hon Hai Precision Industry Co., Ltd.
18 Ltd. Attn: President
C/O Robert Shei 5F-1, No. 5, Hsin-an Road, Hsinchu Science
19
500 S Kraemer Blvd., Suite 100 and Industrial Park, East Area
20 Brea, CA 92821 Hsinchu City, Taiwan, R.O.C.
FIH Mobile Ltd. FIH Mobile Ltd.
21
C/O Vistra (Cayman) Limited Attn: President
22 P.O. Box 31119 Grand Pavilion No. 18 Youyi Road
Hibiscus Way Langfang Economic and Technological
23
802 West Bay Road Development Zone
24 Grand Cayman, KY1-1205 Hebei Province, Peoples Republic of China
Wistron Corporation Wistron Corporation
25
Attn: President Attn: President
26 21F, No. 88, Section 1, Hsin Tai No. 5, Xinan Rd., East Dist.
27 Wu Road, Hsichih Hsinchu City 300, Taiwan R.O.C.
Taipei Hsien 221, Taiwan, R.O.C.
28
Case No. 3:17-cv-1010-WQH-JMA
Certificate of Service
1 Pegatron Corporation Compal Electronics, Inc.

2 Attn: President Attn: President
5F, No. 76, Ligong Street, Beitou Nos. 581 & 581-1 Ruiguang Road, Neihu
3 District District
Taipei City 112, Taiwan, R.O.C. Taipei City 11492, Taiwan, R.O.C.
4
5
Evan R. Chesler
8 Attorney for Plaintiff
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Case No. 3:17-cv-1010-WQH-JMA
2 Certificate of Service

17-05-24 Qualcomm Motion For Preliminary Injunction

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17-05-24 Qualcomm Motion For Preliminary Injunction

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Case 3:17-cv-01010-WQH-JMA Document 35 Filed 05/24/17 PageID.

1 Evan R. Chesler (pro hac vice)

1 PLEASE TAKE NOTICE THAT on June 26, 2017 in the above-referenced

1 Dated: May 24, 2017 Respectfully submitted,

1 Alexander Rudis (pro hac vice)

1 Evan R. Chesler (pro hac vice) (N.Y. Bar No. 1475722)

1 Statutes & Rules

2 Cal. Civ. Proc. Code 526 ................................................................................... 21

1 valuable and practiced by most cellular devices.

1 (ii) refused to pay Defendants

1 to Qualcomm under licensing agreements, withholding only the

1 subm , Defendants collect billions of dollars in revenue

1 Qualcomm is entitled to specific performance to avoid that continuous breach of

1 III. Qualcomm Will Suffer Irreparable Harm Absent a Preliminary

1 trespass of a continuing nature, whose constant recurrence renders the remedy

1 2. Threatened Disruption Licensing Program and

1 3. Decreased Competitive Advantage and Intellectual Property

1 fields as other research groups achieve critical intellectual property positions.

1 difficulty inherent in collecting damages from a foreign defendant with limited

1 Sean S. Pak (SBN 219032)

1 Evan R. Chesler (pro hac vice)

1 I, Vanessa A. Lavely, declare as follows:

1 9. Attached hereto as Exhibit 7 is a true and correct copy of a letter from

1 from Jack Chang to Grace Tai, dated May 3, 2017.

1 dated March 22, 2016, available at http://investor.pegatroncorp.com/annual/

By Overnight Delivery & email to arogers@gualcomm.com

Confidential - Subject to Party Mutual Confidentiality Agreement

I am writing to follow-up on earlier conespondence regarding the BCPA.

swen@qualcomm.com ToiG anny.ch.tong@mail.foxconn.com,cmesa@qualcomm.com

Vivian Wen (i:ta 2 a,A)

From: anny.ch.tong@foxconn.com [mailto:anny.ch.tong@foxconn.com ]

For China custom due to deferent import way.

swen@gualcomm.com ToiG anny.ch.tong@mail.foxconn.com ,cmesa@gualcomm.com

----- Reply message -----

Dear Vivian and Celina

mail from ip-->10.195.151.150

mail from ip-->10.195.151.150

The current information of report are what customer allowed us to provide.

From: Tai, Grace [mailto:gtai@qualcomm.com ]

From: ALLIE WU@WISTRON.COM <ALLIE WU@WISTRON .COM >

From: Tai, Grace [mailto:gtai@qualcomm.com ]

Grace Tai (~$)

April 25, 2017

From: Tien. Shawn (GSM) [mailto:Shawn_Tien@compal.com]

Office: +886-2-8751-6228 ext 13575

From: Chang. JackRF (GSM) [JackRF _Chang@compal.com]

We received the notification from Apple about royalty payment .

So we will only submit non-Apple ' s report/payment.

Address: i:l'jtm 11491 ~~~~@1Clli3855Jj~6fl (SDBG*tl)

From: anny.ch.tong@foxconn.com [anny.ch.tong@foxconn.com)

swen@qualcomm.com ToiG anny.ch.tong@mail.foxconn.com

When can we expect to receive Qli: 17 royalty payment? Thanks.

Vivian Wen (oa ' OA0)

From: anny.ch.tong@foxconn.com [mailto:anny.ch.tong@foxconn.com ]

mail from ip--> I0. 195.151.150

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Ina Fried (/Community/Ina) Apr 28

Apple confirms it won't make royalty payments to Qualcomm

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