TiVo 2008 Annual Report Download - page 90

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Table of Contents
Under this new agreement, DIRECTV will pay a substantially higher monthly fee for households using the new high definition DIRECTV DVRs with
TiVo (when and if the new version of the TiVo service is deployed) than the fees for previously deployed DIRECTV DVRs with TiVo service. DIRECTV
will continue to pay the current monthly fee for all households using only the previously deployed DIRECTV DVRs with TiVo service. The fees paid by
DIRECTV are subject to monthly minimum payments that escalate during the term of the agreement starting in 2010 and those minimum payments are
substantially higher than in the prior agreement. The Company will continue to defer a portion of these fees as a non-refundable credit to fund mutually
agreed development, with excess development work to be funded by DIRECTV.
22. RESIGNATION OF BOARD MEMBER
On August 30, 2007, the Company accepted the resignation of Michael Ramsay as a member of our Board of Directors. Mr. Ramsay has been named to
the post of Venture Partner at New Enterprises Associates, a Silicon Valley venture capital firm, which already has representation on the Company's Board.
Pursuant to the Transition and Consulting Agreement, effective August 30, 2007, Mr. Ramsay agreed to a noncompete provision and that he will be available
to provide services to the Company as a consultant focused on technology and other issues through approximately August, 2009 when and if requested by the
Company. Mr. Ramsay's stock-based awards were modified to provide for accelerated and continued vesting and extended exercise periods. These
modifications were valued at $2.4 million using a Black-Scholes option valuation model. The $2.4 million charge consisted of $546,000 related to stock-based
awards that were not vested as of the modification date and $1,835,000 related to extending the exercisability date of stock-based awards that were vested as
of the modification date. As the terms of the Transition and Consulting Agreement did not create a substantive future service period, the entire non-cash
amount of $2.4 million was expensed immediately in the quarter ended October 31, 2007.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
None
ITEM 9A. CONTROLS AND PROCEDURES
(a) Evaluation of disclosure controls and procedures.
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure
controls and procedures pursuant to Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934 as amended (the "Exchange Act") as of the
end of the period covered by this report ("the Evaluation Date"). In designing and evaluating the disclosure controls and procedures, management recognized
that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control
objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that we are required to
apply our judgment in evaluating the benefits of possible controls and procedures relative to our costs.
Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and
procedures are effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the
Exchange Act (i) is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to
allow timely decisions regarding required disclosure, and (ii) is recorded, processed, summarized and reported within the time periods specified in the
Securities and Exchange Commission rules and forms.
(b) Changes in internal control over financial reporting.
There were no changes in our internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f)) and Rule 15d-15(f) during the
quarter ended January 31, 2009 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
(c) Management's report on internal control over financial reporting.
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule
13a-15(f) and Rule 15d-15(f). Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the
framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this
evaluation, management concluded that our internal control over financial reporting was effective as of January 31, 2009. Management reviewed the results of
its assessment with our Audit Committee.
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