Oracle 2010 Annual Report Download - page 192

COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES
(USD $)
12 Months Ended
05/31/2011
Commitments and Contingencies 12. COMMITMENTS AND CONTINGENCIES
Lease Commitments
We lease certain facilities, furniture and equipment under operating leases. As of May 31, 2011, future minimum
annual operating lease payments and future minimum payments to be received from non-cancelable subleases were
as follows:
(in millions)
Fiscal 2012 $ 458
Fiscal 2013 341
Fiscal 2014 226
Fiscal 2015 159
Fiscal 2016 121
Thereafter 265
Future minimum operating lease payments 1,570
Less: minimum payments to be received from non-cancelable subleases (238 )
Total future minimum operating lease payments, net $ 1,332
Lease commitments include future minimum rent payments for facilities that we have vacated pursuant to our
restructuring and merger integration activities, as discussed in Note 9. We have approximately $320 million in
facility obligations, net of estimated sublease income and other costs, in accrued restructuring for these locations in
our consolidated balance sheet at May 31, 2011.
Rent expense was $406 million, $318 million and $293 million for fiscal 2011, 2010 and 2009, respectively, net of
sublease income of approximately $85 million, $73 million and $69 million, respectively. Certain lease agreements
contain renewal options providing for an extension of the lease term.
Unconditional Obligations
In the ordinary course of business, we enter into certain unconditional purchase obligations with our suppliers, which
are agreements that are enforceable, legally binding and specify terms, including: fixed or minimum quantities to be
purchased; fixed, minimum or variable price provisions; and the approximate timing of the payment. We utilize
several external manufacturers to manufacture sub-assemblies for our hardware products and to perform final
assembly and testing of finished hardware products. We also obtain individual components for our hardware systems
products from a variety of individual suppliers based on projected demand information. Such purchase commitments
are based on our forecasted component and manufacturing requirements and typically provide for fulfillment within
agreed upon lead-times and/or commercially standard lead-times for the particular part or product and have been
included in the amounts below. Routine arrangements for other materials and goods that are not related to our
external manufacturers and certain other suppliers and that are entered into in the ordinary course of business are not
included in the amounts below as they are generally entered into in order to secure pricing or other negotiated terms
and are difficult to quantify in a meaningful way.
As of May 31, 2011, our unconditional purchase and certain other obligations were as follows (in millions):
Fiscal 2012 $ 453
Fiscal 2013 15
Fiscal 2014 7
Fiscal 2015 3
Fiscal 2016 3
Total $ 481
As described in Note 2, we also have a commitment to acquire certain companies for cash consideration that we
expect to pay upon the closing of these acquisitions. As described in Note 8, we have notes payable and other
borrowings outstanding of $15.9 billion that mature at various future dates.
Guarantees
Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research℠