Autodesk 2011 Annual Report Download - page 150

AUTODESK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Indemnifications
In the normal course of business, Autodesk provides indemnifications of varying scopes, including limited
product warranties and indemnification of customers against claims of intellectual property infringement made
by third parties arising from the use of its products or services. Autodesk accrues for known indemnification
issues if a loss is probable and can be reasonably estimated. Historically, costs related to these indemnifications
have not been significant, and because potential future costs are highly variable, Autodesk is unable to estimate
the maximum potential impact of these indemnifications on its future results of operations.
In connection with the purchase, sale or license of assets or businesses with third parties, Autodesk has
entered into or assumed customary indemnification agreements related to the assets or businesses purchased, sold
or licensed. Historically, costs related to these indemnifications have not been significant, and because potential
future costs are highly variable, Autodesk is unable to estimate the maximum potential impact of these
indemnifications on its future results of operations.
As permitted under Delaware law, Autodesk has agreements whereby it indemnifies its officers and
directors for certain events or occurrences while the officer or director is, or was, serving at Autodesk’s request
in such capacity. The maximum potential amount of future payments Autodesk could be required to make under
these indemnification agreements is unlimited; however, Autodesk has directors’ and officers’ liability insurance
coverage that is intended to reduce its financial exposure and may enable Autodesk to recover a portion of any
future amounts paid. Autodesk believes the estimated fair value of these indemnification agreements in excess of
applicable insurance coverage is minimal.
Legal Proceedings
Autodesk is involved in a variety of claims, suits, investigations and proceedings in the normal course of
business activities including claims of alleged infringement of intellectual property rights, commercial,
employment, piracy prosecution, business practices and other matters. In the Company’s opinion, resolution of
pending matters is not expected to have a material adverse impact on its consolidated results of operations, cash
flows or its financial position. However, it is possible that an unfavorable resolution of one or more such
proceedings could in the future materially affect its future results of operations, cash flows or financial position
in a particular period.
Note 9. Stockholders’ Equity
Preferred Stock
Under Autodesk’s Certificate of Incorporation, 2.0 million shares of preferred stock are authorized. At
January 31, 2011, there were no preferred shares issued or outstanding. The Board of Directors has the authority
to issue the preferred stock in one or more series and to fix rights, preferences, privileges and restrictions,
including dividends and the number of shares constituting any series or the designation of such series, without
any further vote or action by the stockholders.
Common Stock Repurchase Programs
Autodesk has a stock repurchase program that helps offset the dilution to net income per share caused by the
issuance of stock under the Company’s employee stock plans and returns excess cash generated from its business
to stockholders and for such other purposes as may be in the best interests of Autodesk and its stockholders.
During fiscal 2011, Autodesk repurchased and retired 9.0 million shares at an average repurchase price of $31.13
per share, 2.7 million shares in fiscal 2010 at an average repurchase price of $23.63 per share and 8.0 million
shares in fiscal 2009 at an average repurchase price of $32.06. Common stock and additional paid-in capital and
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