Blizzard 2003 Annual Report Download - page 49

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page 48
Notes to Consolidated Financial Statements
Mortgage Notes Payable. Mortgage notes payable were $2.8 million and $3.3 million as of March 31, 2003
and 2002, respectively. Mortgage notes payable relate to the land, office and warehouse facilities of our
German subsidiary as of March 31, 2003 and of our German and Netherlands subsidiaries as of March 31, 2002.
The Netherlands subsidiary’s mortgage note was repaid in full in fiscal 2003. The German mortgage note bears
interest at 5.45%, is due in bi-annual installments of EUR 73,900 ($79,700), is collateralized by the related assets
and matures December 2018. Prior to repayment, the Netherlands mortgage note bore interest at 5.35%,
was payable in quarterly installments of EUR 11,300 ($12,200) and was collateralized by the related assets.
Private Placement of Convertible Subordinated Notes. In December 1997, we completed the private
placement of $60.0 million principal amount of 63⁄4% convertible subordinated notes due 2005 (the
“Notes”). The Notes were convertible, in whole or in part, at the option of the holder at any time after
December 22, 1997 (the date of original issuance) and prior to the close of business on the business day
immediately preceding the maturity date, unless previously redeemed or repurchased, into our common
stock at a conversion price of $8.389 per share, subject to adjustment in certain circumstances. During the
three months ended June 30, 2001, we called for the redemption of the Notes. In connection with that
call, holders converted to common stock approximately $58.7 million aggregate principal amount of their
Notes, net of conversion costs. The remaining Notes were redeemed for cash.
Annual maturities of long-term debt are as follows (amounts in thousands):
Year ended March 31,
2004 $ 147
2005 159
2006 159
2007 159
2008 and thereafter 2,194
Total $ 2,818
13. Commitments and Contingencies
Developer and Intellectual Property Contracts. In the normal course of business we enter into contractual
arrangements with third parties for the development of products, as well as for the rights to intellectual prop-
erty. Under these agreements, we commit to provide specified payments to a developer, or intellectual
property holder, based upon contractual arrangements. Assuming all contractual provisions are met, the
total future minimum contract commitment for contracts in place as of March 31, 2003 is approximately
$138.1 million, which is scheduled to be paid as follows (amounts in thousands):
Year ended March 31,
2004 $ 89,175
2005 28,066
2006 12,300
2007 6,075
2008 and thereafter 2,501
Total $138,117
Lease Obligations. We lease certain of our facilities under non-cancelable operating lease agreements.
Total future minimum lease commitments as of March 31, 2003 are as follows (amounts in thousands):
Year ended March 31,
2004 $ 7,135
2005 6,394
2006 5,471
2007 4,979
2008 and thereafter 16,536
Total $ 40,515