Autodesk 2008 Annual Report Download - page 147

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AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Note 5. Borrowing Arrangements
Autodesk has available a U.S. line of credit facility. This line of credit facility permits unsecured short-term
borrowings of up to $250.0 million, and is available for working capital or other business needs. The credit
agreement contains customary covenants which could restrict liens, certain types of additional debt and
dispositions of assets if Autodesk fails to maintain its financial covenants. This facility expires in August 2012
and there were no borrowings outstanding at January 31, 2008.
Note 6. Commitments and Contingencies
Leases
Autodesk leases office space and computer equipment under noncancellable operating lease agreements.
The leases generally provide that Autodesk pay taxes, insurance and maintenance expenses related to the leased
assets. Future minimum lease payments for fiscal years ended January 31 are as follows:
2009 ....................................................................... $ 61.4
2010 ....................................................................... 50.5
2011 ....................................................................... 42.0
2012 ....................................................................... 28.8
2013 ....................................................................... 22.1
Thereafter ................................................................... 24.8
229.6
Less: Sublease income ......................................................... (3.7)
$225.9
Autodesk leases office space under arrangements expiring through 2017. Certain of these lease
arrangements contain escalation clauses. Autodesk leases computer equipment under arrangements expiring
through 2012. Rent expense is recognized on a straight-line basis over the lease period. Rent expense was $49.6
million in fiscal 2008, $40.6 million in fiscal 2007, and $38.0 million in fiscal 2006.
Purchase commitments
Autodesk, in the normal course of business, enters into various purchase commitments for goods or services.
Total non-cancellable purchase commitments as of January 31, 2008 were approximately $39.0 million for
periods through fiscal 2009. These purchase commitments primarily result from contracts for the acquisition of
IT infrastructure, marketing and software development services. Of the total purchase commitments,
$24.5 million related to a termination fee for an outsource application hosting services agreement entered into
during fiscal 2006. This fee is reduced as time lapses during the five-year contract period.
Autodesk has certain royalty commitments associated with the shipment and licensing of certain products.
Royalty expense is generally based on a dollar amount per unit shipped or a percentage of the underlying
revenue. Royalty expense, which was recorded under cost of license and other revenue on Autodesk’s
Consolidated Statements of Income, was $14.9 million in fiscal 2008, $16.8 million in fiscal 2007, and $12.1
million in fiscal 2006.
71
2008 Annua
l Report