Oracle 2013 Annual Report Download - page 122

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Table of Contents
ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2014
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, 2014, our unconditional purchase and certain other obligations were as follows (in millions):
We 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 and Note 11 above, as of May 31, 2014 we have notes payable and other borrowings outstanding of $24.2 billion that mature
at various future dates and derivative financial instruments outstanding that we leverage to manage certain risks and exposures.
Guarantees
Our software and hardware systems product sales agreements generally include certain provisions for indemnifying customers against liabilities
if our products infringe a third party’s intellectual property rights. To date, we have not incurred any material costs as a result of such
indemnifications and have not accrued any material liabilities related to such obligations in our consolidated financial statements. Certain of our
product sales agreements also include provisions indemnifying customers against liabilities in the event we breach confidentiality or service
level requirements. It is not possible to determine the maximum potential amount under these indemnification agreements due to our limited and
infrequent history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement.
Our software license and hardware systems products agreements also generally include a warranty that our products will substantially operate as
described in the applicable program documentation for a period of one year after delivery. We also warrant that services we perform will be
provided in a manner consistent with industry standards for a period of 90 days from performance of the service.
We occasionally are required, for various reasons, to enter into financial guarantees with third parties in the ordinary course of our
business including, among others, guarantees related to foreign exchange trades, taxes, import licenses and letters of credit on behalf of parties
with whom we conduct business. Such agreements have not had a material effect on our results of operations, financial position or cash flows.
118
Fiscal 2015
$
469
Fiscal 2016
28
Fiscal 2017
12
Fiscal 2018
1
Fiscal 2019
—
Thereafter
—
Total
$
510