TeleNav 2010 Annual Report Download - page 65

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provided principally by net income of $41.4 million, non-cash charges for depreciation and amortization of $5.2
million and stock-based compensation of $4.9 million offset by $7.1 million from changes in our operating assets
and liabilities.
Net cash used in investing activities. We used net cash in investing activities of $1.7 million, $7.0 million
and $9.8 million during fiscal 2008, 2009 and 2010, respectively. The cash was used primarily for purchases of
property and equipment and internal software development costs. We expect to increase our capital expenditures
in future periods as we continue to invest in the infrastructure needed to operate our services for an increasing
end user base, as well as in equipment and facilities for our growing worldwide employee base as we expand our
business.
Net cash provided by (used in) financing activities. During fiscal 2008, 2009 and 2010, we generated (used)
cash in our financing activities of $(35,000), $68,000 and $45.1 million, respectively, due to proceeds from the
exercise of warrants and options for our preferred and common stock, respectively, net of any settlement or
repurchases of our outstanding stock or options. Cash generated in fiscal 2010 included net proceeds of $44.6
million as a result of the completion of our IPO in May 2010.
Contractual obligations, commitments and contingencies
We generally do not enter into long term minimum purchase commitments. However, we have agreed to
pay minimum annual license fees to certain of our third party content providers. Our principal commitments, in
addition to those related to our third party content providers, consist of obligations under facility leases for office
space in Sunnyvale, California; Kirkland, Washington; Ashburn, Virginia; Shanghai, China; Beijing, China;
Xi’an, China; and Chelmsford, England.
The following table summarizes our outstanding noncancelable contractual obligations as of June 30, 2010:
Payments due by period
Total
Less than
1 Year 1-3 Years 3-5 Years
More than
5 Years
(in thousands)
Operating lease obligations(1) . . $ 5,908 $2,128 $ 3,608 $ 172 $—
Purchase obligations(2) ....... 15,863 7,825 7,038 1,000 —
Total contractual obligations . . . $21,771 $9,953 $10,646 $1,172 $—
(1) Consists of contractual obligations for office space under noncancelable operating leases.
(2) Consists of minimum noncancelable financial commitments primarily related to fees owed to certain third
party content providers, regardless of usage level.
At June 30, 2010, we had a liability for unrecognized tax benefits and an accrual for the payment of related
interest totaling $2.9 million, of which none is expected to be paid within one year. Due to uncertainties related
to these tax matters, we are unable to make a reasonably reliable estimate of when cash settlements with the
taxing authority will occur.
Warranties and indemnifications
Our agreements with our wireless carrier partners that offer our LBS generally include certain provisions for
indemnifying them against liabilities if our LBS infringe a third party’s intellectual property rights or for other
specified reasons. We have in the past received indemnification requests or notices of their intent to seek
indemnification in the future from our wireless carrier partners with respect to litigation in which our wireless
carrier partners have been named as defendants. See the section entitled “Legal Proceedings.” As it relates to past
indemnification requests or notices, in certain situations we have agreed to defend or indemnify our wireless
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