Audiovox 2010 Annual Report Download - page 40

Payments Due by Period
Less than 1-3 4-5 After
Contractual Cash Obligations Total 1 Year Years Years 5 Years
Capital lease obligation (1) $ 10,407 $ 521 $ 1,109 $ 1,147 $ 7,630
Operating leases (2) 22,990 4,903 6,452 4,295 7,340
Total contractual cash obligations $ 33,397 $ 5,424 $ 7,561 $ 5,442 $ 14,970
Amount of Commitment Expiration per period
Total
Amounts Less than 1-3 4-5 After
Other Commercial Commitments Committed 1 Year Years Years 5 years
Bank obligations (3) $ 1,703 $ 1,703 $ - $ - $ -
Stand-by letters of credit (4) 1,294 1,294 - - -
Commercial letters of credit (4) 319 319 - - -
Debt (5) 12,996 6,383 6,613 - -
Contingent earn-out payments (6) 9,760 3,296 4,171 2,201 92
Unconditional purchase obligations (7) 76,580 76,580 - - -
Total commercial commitments $ 102,652 $ 89,575 $ 10,784 $ 2,201 $ 92
(1) Represents total payments (interest and principal) due under a capital lease obligation which has a current (included in other
current liabilities) and long term principal balance of $82 and $5,449, respectively at February 28, 2010.
(2) We enter into operating leases in the normal course of business.
(3) Represents amounts outstanding under the Audiovox Germany factoring agreement at February 28, 2010 and a short-term loan
related to the purchase of Invision.
(4) Commercial letters of credit are issued during the ordinary course of business through major domestic banks as requested by
certain suppliers. We also issue standby letters of credit to secure certain bank obligations and insurance requirements.
(5) Represents amounts outstanding under term loan agreements in connection with the Oehlbach and Invision acquisitions. This
amount also includes amounts due under a call-put option with certain employees of Audiovox Germany.
(6) Represents contingent payments in connection with the Thomson Accessory and Oehlbach acquisitions (see Note 2 of the
Consolidated Financial Statements).
(7) Open purchase obligations represent inventory commitments. These obligations are not recorded in the consolidated financial
statements until commitments are fulfilled and such obligations are subject to change based on negotiations with manufacturers.
We regularly review our cash funding requirements and attempt to meet those requirements through a combination of cash on
hand, cash provided by operations, available borrowings under bank lines of credit and possible future public or private debt and/or
equity offerings. At times, we evaluate possible acquisitions of, or investments in, businesses that are complementary to ours, which
transactions may require the use of cash. We believe that our cash, other liquid assets, operating cash flows, credit arrangements,
access to equity capital markets, taken together, provides adequate resources to fund ongoing operating expenditures. In the event that
they do not, we may require additional funds in the future to support our working capital requirements or for other purposes and may
seek to raise such additional funds through the sale of public or private equity and/or debt financings as well as from other
sources. No assurance can be given that additional financing will be available in the future or that if available, such financing will be
obtainable on terms favorable when required.
Off-Balance Sheet Arrangements
We do not maintain any off-balance sheet arrangements, transactions, obligations or other relationships with unconsolidated
entities that would be expected to have a material current or future effect upon our financial condition or results of operations.
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Source: AUDIOVOX CORP, 10-K, May 14, 2010 Powered by Morningstar® Document Research℠