TiVo 2004 Annual Report Download - page 88

Table of Contents
Index to Financial Statements
Of the total accrued facilities liability recorded as a result of the Company's unoccupied facility, $28,000 is included in deferred rent and other long-
term liabilities and $113,000 is included in accrued liabilities in the accompanying consolidated balance sheet at January 31, 2005.
Future minimum operating lease payments as of January 31, 2005, were as follows:
Fiscal Year Ending
Lease Payments
(In thousands)
January 31, 2006 $ 3,326
January 31, 2007 3,295
January 31, 2008 273
January 31, 2009 —
Total $ 6,894
18. SILICON VALLEY BANK LINE OF CREDIT
On July 17, 2003, the Company entered into a loan and security agreement with Silicon Valley Bank, whereby Silicon Valley Bank agreed to extend a
revolving line of credit of up to the lesser of $6.0 million or a borrowing base. On June 29, 2004, the Company renewed its loan and security agreement with
Silicon Valley Bank for an additional two years, whereby Silicon Valley Bank agreed to increase the amount of the revolving line of credit it extends to it
from a maximum of $6.0 million to $15.0 million. The first amendment to the Silicon Valley Bank loan and security agreement also replaces the borrowing
base requirement with a requirement that the Company maintains a certain pre-determined Tangible Net Worth (as defined in the first amendment). The line
of credit remains secured by a first priority security interest on all of the Company's assets except for its intellectual property. However, the agreement with
Silicon Valley Bank also includes a negative pledge such that the Company will not, among other things except in accordance with certain enumerated
exceptions, sell, transfer, assign, mortgage, pledge, lease, grant a security interest in, or encumber any of its Intellectual Property without the consent of
Silicon Valley Bank. The line of credit now bears interest at the greater of prime or 4.00% per annum, but in an event of default that is continuing, the interest
rate becomes 3.00% above the rate effective immediately before the event of default. The first amendment also allows the Company to enter into foreign
exchange forward contracts in which it may commit to purchase from or sell to Silicon Valley Bank a set amount of foreign currency. The loan and security
agreement includes, among other terms and conditions, limitations on the Company's ability to dispose of its assets; merge or consolidate with or into another
person or entity; create, incur, assume or be liable for indebtedness (other than certain types of permitted indebtedness, including existing and subordinated
debt and debt to trade creditors incurred in the ordinary course of business); create, incur or allow any lien on any of its property or assign any right to receive
income except for certain permitted liens; make investments; pay dividends; or make distributions; and contains a requirement that the Company maintain
certain financial ratios. At January 31, 2005, the Company was in compliance with these covenants and had $4.5 million outstanding under the line of credit.
The outstanding balance was repaid in its entirety in February 2005. The line of credit terminates and any and all borrowings are due on June 29, 2006, but
may be terminated earlier by the Company without penalty upon written notice and prompt repayment of all amounts borrowed.
19. RETIREMENT PLAN
In December 1997, the Company established a 401(k) Retirement Plan (the "Retirement Plan") available to employees who meet the plan's eligibility
requirements. Participants may elect to contribute a percentage of their compensation to the Retirement Plan up to a statutory limit. Participants are fully
vested in their contributions. The Company may make discretionary contributions to the Retirement Plan as a percentage of participant contributions, subject
to established limits. The Company has not made any contributions to the Retirement Plan through January 31, 2005.
20. ADOPTION OF STOCKHOLDER RIGHTS PLAN
On January 9, 2001, TiVo's Board of Directors declared a dividend distribution of one Preferred Share Purchase Right ("Right") on each outstanding
share of TiVo common stock outstanding at the close of business on January 1, 2001 ("the Rights Plan"). Subject to limited exceptions, the Rights will be
exercisable if a person or group acquires 15% or more or 30.01% or more in the case of AOL and its affiliates and associates, of the Company's common
stock or announces a tender offer for 15% or more of the common stock, ("Acquiring Person"). Under certain circumstances, each Right will entitle
stockholders to buy one one-hundredth of a share of newly created Series B Junior Participating Preferred Stock of TiVo at an exercise price of $60.00 per
Right, subject to adjustments under certain circumstances. The rights are not exercisable as of January 31, 2005. The TiVo Board will be entitled to redeem
the Rights at $.01 per Right at any time before a person has become an Acquiring Person.
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