Overstock.com 2005 Annual Report Download - page 57

Cash used in investing activities during 2005 included $44.7 million in capital expenditures for property and equipment and the
acquisition of Ski West for $24.6 million, offset by a net increase of $30.7 million from the purchase and sales of marketable
securities. For the years ended December 31, 2004 and 2005, net cash used in investing activities amounted to $87.8 million and
$37.3 million, respectively.
Net cash used in financing activities during the year ended December 31, 2005 totaled $99.1 million, consisting primarily of cash
used for payments of capital leases of $7.1 million, retirement of our convertible senior notes of $35.7 million, and cash used to buy
stock and options to buy our stock of $63.7 million, offset by proceeds from the exercise of stock options and warrants of $7.3 million.
Financing activities for 2004 totaled inflows of $232.6 million, comprised of net proceeds of $113.1 million received from our follow-
on public offerings which occurred in February and November, $116.2 million from the issuance of convertible senior notes and
approximately $4.3 million received from the exercise of stock options and warrants. Cash flows from financing activities during 2004
included $658,000 for payments on capital leases.
Contractual Obligations and Commitments. The following table summarizes our contractual obligations as of December 31,
2005 and the effect such obligations and commitments are expected to have on our liquidity and cash flow in future periods:
Payments Due by Period
(in thousands)
Contractual Obligations Total
Less than
1 Year 1-3 Years 4-5 Years
After
5 years
Long-term debt arrangements $ 74,935 $ — $ — $ — $ 74,935
Interest on convertible senior notes 17,325 2,888 5,775 5,775 2,887
Capital lease obligations 10,520 7,249 3,271 — —
Operating leases 71,460 6,035 13,746 15,513 36,166
Purchase obligations 37,022 37,022 — — —
Total contractual cash obligations $ 211,262 $ 53,194 $ 22,792 $ 21,288 $ 113,988
Amounts of Commitment Expiration Per Period
(in thousands)
Other Commercial Commitments
Total
Amounts
Committed
Less than
Year 1 1-3 Years 4-5 Years
Over
5 years
Letters of credit $ 9,464 $ 9,464 $ — $ — $ —
Redeemable common stock 3,025 3,025 — — —
Total commercial commitments $ 12,489 $ 12,489 $ — $ — $ —
3.75% Convertible Senior Notes
In November 2004, we completed an offering of $120.0 million of 3.75% Convertible Senior Notes (the "Senior Notes"). Interest
on the Senior Notes is payable semi-annually on June 1 and December 1 of each year, beginning June 1, 2005. The Senior Notes
mature on December 1, 2011 and are unsecured and rank equally in right of payment with all existing and future unsecured,
unsubordinated debt and senior in right of payment to any existing and future subordinated indebtedness. The Senior Notes are
convertible at any time prior to maturity into our common stock at the option of the note holders at a conversion price of $76.23 per
share (subject to adjustment in certain events, including stock splits, dividends and other distributions and certain repurchases of our
stock, as well as certain fundamental changes in the ownership of the Company).
Beginning December 1, 2009, we have the right to redeem the Senior Notes, in whole or in part, for cash at 100% of the principal
amount plus accrued and unpaid interest. Upon the occurrence of a fundamental change (including the acquisition of a majority
interest in the Company, certain changes in
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