Oracle 2012 Annual Report Download - page 117

ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2012
12. COMMITMENTS AND CONTINGENCIES
Lease Commitments
We lease certain facilities, furniture and equipment under operating leases. As of May 31, 2012, future minimum
annual operating lease payments and future minimum payments to be received from non-cancelable subleases
were as follows:
(in millions)
Fiscal 2013 ......................................................................... $ 406
Fiscal 2014 ......................................................................... 307
Fiscal 2015 ......................................................................... 227
Fiscal 2016 ......................................................................... 172
Fiscal 2017 ......................................................................... 129
Thereafter .......................................................................... 294
Future minimum operating lease payments ............................................ 1,535
Less: minimum payments to be received from non-cancelable subleases ..................... (125)
Total future minimum operating lease payments, net ................................ $ 1,410
Lease commitments included 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 $249 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, 2012.
Rent expense was $329 million, $406 million and $318 million for fiscal 2012, 2011 and 2010, respectively, net
of sublease income of approximately $89 million, $85 million and $73 million, respectively. Certain lease
agreements contain renewal options providing for extensions of the lease terms.
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, 2012, our unconditional purchase and certain other obligations were as follows (in millions):
Fiscal 2013 .......................................................................... $ 523
Fiscal 2014 .......................................................................... 49
Fiscal 2015 .......................................................................... 4
Fiscal 2016 .......................................................................... 3
Total ........................................................................... $ 579
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