Oracle 2008 Annual Report Download - page 64

Table of Contents
based awards denominated in shares of Sun common stock outstanding immediately prior to the
consummation of the merger will generally be converted into options, restricted stock unit awards or other
equity-based awards, as the case may be, denominated in shares of our common stock based on formulas
contained in the Merger Agreement. The estimated total purchase price of Sun is approximately $7.4 billion.
This transaction is subject to Sun stockholder approval, regulatory clearance under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976 and the applicable merger control laws of the European Commission and
other jurisdictions, and other customary closing conditions. We also have entered into certain other
agreements to acquire other companies and expect these proposed acquisitions to close during the first quarter
of fiscal 2010. We intend to finance our proposed acquisitions through a combination of our internally
available cash, our cash generated from operations, our existing available debt capacity, additional
borrowings, or from the issuance of additional securities.
As of May 31, 2009, we have $2.3 billion of unrecognized tax benefits recorded on our consolidated balance
sheet. We have reached certain settlement agreements with relevant taxing authorities to pay approximately
$79 million of these liabilities (these amounts have been excluded from the table above due to the uncertainty
of when they might be settled). Although it remains unclear as to when payments pursuant to these
agreements will be made, some or all may be made in fiscal 2010. We cannot make a reasonably reliable
estimate of the period in which the remainder of our unrecognized tax benefits will be settled or released with
the relevant tax authorities, although we believe it is reasonably possible that certain of these liabilities could
be settled or released during fiscal 2010 (see Note 14 of Notes to Consolidated Financial Statements).
We believe that our current cash, cash equivalents and marketable securities and cash generated from
operations will be sufficient to meet our working capital, capital expenditures and contractual obligations. In
addition, we believe we could fund any future acquisitions, including the proposed Sun acquisition, and
dividend payments and repurchase common stock or debt with our internally available cash, cash equivalents
and marketable securities, cash generated from operations, our existing available debt capacity, additional
borrowings or from the issuance of additional securities.
Off-Balance Sheet Arrangements: We do not have any off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on our financial condition, changes in financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are
material to investors.
Selected Quarterly Financial Data
Quarterly revenues, expenses and operating income have historically been affected by a variety of seasonal
factors, including sales force incentive compensation plans. In addition, our European operations generally
provide lower revenues in our first fiscal quarter because of the reduced economic activity in Europe during
the summer. These seasonal factors are common in the software industry. These factors have caused a
decrease in our first quarter revenues as compared to revenues in the immediately preceding fourth quarter,
which historically has been our highest revenue quarter within a particular fiscal year. Similarly, the operating
income of our business is affected by seasonal factors in a consistent manner as our revenues (in particular,
our new software license business) as certain expenses within our cost structure are relatively fixed in the
short term. We expect these trends to continue in fiscal 2010.
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Source: ORACLE CORP, 10-K, June 29, 2009 Powered by Morningstar® Document Research℠