NVIDIA 2011 Annual Report Download - page 84

NVIDIA CORPORATION AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Continued)
In addition to the commitment of our headquarters, we have other domestic and international office facilities under operating leases expiring
through fiscal year 2018. Future minimum lease payments under our non-cancelable operating leases as of January 30, 2011, are as follows:
Future Minimum Lease Obligations
(In thousands)
Year ending January:
2012 $ 46,329
2013 27,898
2014 23,071
2015 18,949
2016 15,166
2017 and thereafter 45,753
Total $ 177,166
Rent expense for the years ended January 30, 2011, January 31, 2010 and January 25, 2009 was $40.7 million, $46.2 million and $43.0 million,
respectively.
Capital lease reflect building and office equipment lease obligations. The building lease relates to our data center in Santa Clara, California. Future
minimum lease payments under the building capital lease total $39.5 million over the remaining lease term, including predetermined rent escalations, and are
included in the future minimum lease payment schedule below:
Future Capital Lease Obligations
(In thousands)
Year ending January:
2012 $ 4,654
2013 4,788
2014 4,926
2015 4,852
2016 4,997
2017 and thereafter 15,909
Total $ 40,126
Present Value of minimum lease payments $ 25,063
Current portion $ 1,674
Long term portion $ 23,389
Litigation
3dfx
On December 15, 2000, NVIDIA and one of our indirect subsidiaries entered into an Asset Purchase Agreement, or APA, to purchase certain
graphics chip assets from 3dfx. The transaction closed on April 18, 2001. That acquisition, and 3dfx’s October 2002 bankruptcy filing, led to four lawsuits
against NVIDIA: two brought by 3dfx’s former landlords, one by 3dfx’s bankruptcy trustee and the fourth by a committee of 3dfx’s equity security holders in
the bankruptcy estate. As of the date of the filing of this Annual Report on Form 10-K, the two landlord cases have been settled with payments from the
landlords to NVIDIA, and the equity security holders lawsuit was dismissed with prejudice and no appeal was filed. Accordingly, only the bankruptcy trustee
suit remains outstanding as more fully explained below.
In March 2003, the Trustee appointed by the Bankruptcy Court to represent 3dfx’s bankruptcy estate served a complaint on NVIDIA asserting claims
for, among other things, successor liability and fraudulent transfer and seeking additional payments from us. The Trustee’s fraudulent transfer theory alleged
that NVIDIA had failed to pay reasonably equivalent value for 3dfx’s assets, and sought recovery of the difference between the $70 million paid and the
alleged fair value, which the Trustee estimated to exceed $50 million. The Trustee’s successor liability theory alleged NVIDIA was effectively 3dfx’s legal
successor and therefore was responsible for all of 3dfx’s unpaid liabilities.
On October 13, 2005, the Bankruptcy Court heard the Trustee’s motion for summary adjudication, and on December 23, 2005, denied that motion in
all material respects and held that NVIDIA may not dispute that the value of the 3dfx transaction was less than $108 million. The Bankruptcy Court denied
the Trustee’s request to find that the value of the 3dfx assets conveyed to NVIDIA was at least $108 million.
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