Avid 2008 Annual Report Download - page 49

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44
a restructuring accrual of $0.8 million related to this acquisition-related lease obligation. The lease payments will be
made over the remaining term of the lease, which expires in 2010.
All payments related to restructuring actions are expected to be funded through working capital. See Note N to our
Consolidated Financial Statements in Item 8 for the activity in the restructuring and other costs accrual for 2008.
Our cash requirements vary depending on factors such as our growth, capital expenditures, acquisitions of businesses or
technologies and obligations under restructuring programs. We believe that our existing cash, cash equivalents,
marketable securities and funds generated from operations will be sufficient to meet our operating cash requirements for
at least the next twelve months. In the event that we require additional financing, we believe that we will be able to
obtain such financing; however, there can be no assurance that we would be successful in doing so or that we could do
so on favorable terms.
Fair Value Inputs
On January 1, 2008, we adopted SFAS No. 157, Fair Value Measurements, and SFAS No. 159, The Fair Value Option
for Financial Assets and Financial Liabilities - Including an Amendment of FASB Statement No. 115. SFAS No. 159
permits entities to choose to measure many financial instruments and certain other items at fair value. We elected not to
measure any additional financial instruments or other items at fair value.
We value our cash and investment instruments using quoted market prices, broker or dealer quotations, or alternative
pricing sources with reasonable levels of price transparency. See Note B to our Condensed Consolidated Financial
Statements included in Item 8 of this annual report for disclosure of the fair values and the inputs used to determine the
fair values of our financial assets and financial liabilities.
CONTRACTUAL AND COMMERCIAL OBLIGATIONS
The following table sets forth future payments that we are obligated to make as of December 31, 2008 under existing
lease agreements and commitments to purchase inventory (in thousands):
Total
Less than
1 Year
1 – 3 Years
3 – 5 Years
After
5 Years
Operating leases $ 91,140 $24,252 $33,324 $20,009 $13,555
Unconditional purchase obligations 56,273 56,273 — — —
$147,413 $80,525 $33,324 $20,009 $13,555
Other contractual arrangements or unrecognized tax positions that may result in cash payments consist of the following
(in thousands):
Total
Less than
1 Year
1 – 3 Years
3 – 5 Years
After
5 Years
All
Other
Transactions with recourse $ 4,605 $4,605 — — $ — $ —
FIN 48 liability and interest (a) 3,700 — — — — 3,700
Stand-by letter of credit 750 — — — 750 —
$9,055 $4,605 — — $750 $3,700
(a) As of December 31, 2008, our FIN 48 liability related to unrecognized tax positions and related interest
was $3.7 million, and we were unable to reasonably estimate the timing of our FIN 48 liability in
individual years beyond twelve months due to uncertainties in the timing of the effective settlement of
the positions.
Through third parties, we offer lease financing options to our customers. During the terms of these financing
arrangements, which are generally for three years, we may remain liable for a portion of the unpaid principal balance in
the event of a default on the lease by the end user, but our liability is limited in the aggregate based on a percentage of