Avid 1997 Annual Report Download - page 39

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32
Total cash payments for interest in 1997, 1996, and 1995 were approximately $136,000, $311,000, and $741,000,
respectively.
Line of Credit
The Company has an unsecured line of credit with a group of banks which provides for up to $35.0 million in revolving
credit. The line of credit agreement was amended on June 27, 1997 to expire on June 30, 1998. Under the terms of the
agreement, the Company must pay an annual commitment fee of 1/4% of the average daily unused portion of the facility,
payable quarterly in arrears. The Company has two loan options available under the agreement: the Base Rate Loan and the
LIBOR Rate Loan. The interest rates to be paid on the outstanding borrowings for each loan annually are equal to the Base
Rate or LIBOR plus 1.25%, respectively. Additionally, the Company is required to maintain certain financial ratios and is
bound by covenants over the life of the agreement, including a restriction on the payment of dividends. The Company had
no borrowings against this facility as of December 31, 1997.
Three of the Company’s European subsidiaries have unsecured overdraft facilities that permit aggregate borrowings of Italian
Lire 300,000,000, Irish Punt 150,000 and German Mark 800,000. No borrowings were outstanding under these facilities as
of December 31, 1997.
H. Income Taxes
Income (loss) before income taxes and the components of the income tax provision (benefit) for the years ended December
31, 1997, 1996, and 1995 are as follows (in thousands):
1997 1996 1995
Income (loss) before income taxes:
United States $22,017 $(61,242) $5,582
Foreign 16,221 5,295 18,445
Total income (loss) before income taxes $38,238 $(55,947) $24,027
Provisions for (benefit from) income taxes:
Current tax expense:
Federal $2,353 $(3,235) $7,433
Foreign 4,667 3,189 5,487
State 75 (16) 1,094
Total current 7,095 (62) 14,014
Deferred tax benefit:
Federal 4,937 (15,820) (4,968)
Foreign (1,237) (32)
State 1,059 (2,021) (426)
Total deferred 4,759 (17,841) (5,426)
Total income tax provision (benefit) $11,854 $(17,903) $8,588
Net cash payments or (refunds) for income taxes in 1997, 1996, and 1995 were approximately $(1,104,103), $4,911,000,
and $7,927,000 respectively. The net refund in 1997 was the result of the 1996 loss, which was carried back to 1993,
1994, and 1995 for federal tax purposes.
The cumulative amount of undistributed earnings of subsidiaries which is intended to be permanently reinvested and for
which U.S. income taxes have not been provided totaled $34,806,000 at December 31, 1997.