8x8 2015 Annual Report Download - page 51

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We lease our UK headquarters in Aylesbury UK under operating lease agreements that expires in March 2017. The lease was amended in
September 2014 for additional space. The lease has a base monthly rent of approximately $7,800 until March 2015, rising to approximately
$8,800 thereafter, and requires us to pay property taxes, service charges, utilities and normal maintenance costs. We also lease office space in
London UK under an operating lease agreement that expires in April 2019. The lease has a base monthly rent of approximately $6,700 until
March 2016, rising to approximately $7,100 thereafter.
In the third quarter of 2010, we amended our contract with one of our third party customer support vendors containing a minimum monthly
commitment of approximately $0.4 million. The agreement requires a 150-day notice to terminate. At March 31, 2015, the total remaining
obligation under the contract was $2.2 million.
We entered into contracts with multiple vendors for third party network service which expire on various dates in fiscal 2016 through 2018. At
March 31, 2015, the total remaining obligations under these contracts were $6.4 million.
At March 31, 2015, we had open purchase orders of $48,000, primarily related to inventory purchases from our contract manufacturers. These
purchase commitments are reflected in our consolidated financial statements once goods or services have been received or at such time when we
are obligated to make payments related to these goods or services.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The primary objective of our investment activities is to preserve principal while maximizing income without significantly increasing risk. Some
of the securities in which we invest may be subject to market risk. This means that a change in prevailing interest rates may cause the principal
amount of the investment to fluctuate. To minimize this risk, we may maintain our portfolio of cash equivalents and investments in a variety of
securities, including commercial paper, money market funds, debt securities and certificates of deposit. The risk associated with fluctuating
interest rates is limited to our investment portfolio and we do not believe that a 10% change in interest rates would have a significant impact on
our interest income.
During the years ended March 31, 2015 and 2014, we did not have any outstanding debt instruments other than equipment under capital leases
and, therefore, we were not exposed to market risk relating to interest rates.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE
46
Page
FINANCIAL STATEMENTS:
Report of Independent Registered Public Accounting Firm
47
Consolidated Balance Sheets at March 31, 2015 and 2014
48
Consolidated Statements of Income for each of the three years in the period ended March 31, 2015
49
Consolidated Statements of Comprehensive Income for each of the three years in the period ended March 31, 2015
50
Consolidated Statements of Stockholders' Equity for each of the three years in the period ended March 31, 2015
51
Consolidated Statements of Cash Flows for each of the three years in the period ended March 31, 2015
52
Notes to Consolidated Financial Statements
53