TiVo 2008 Annual Report Download - page 79

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Table of Contents
Other. In April 2008, the Attorney General of Missouri served TiVo Inc. with an investigative demand subpoena seeking information as to whether the
Company has engaged in any unlawful merchandising practices in connection with its rebate program in the State of Missouri. The Company has been
cooperating with the investigation. Should there be an adverse outcome, the Company's business could be harmed. No loss is considered probable or
estimable at this time.
The Company is involved in numerous lawsuits and receives numerous threats of litigation in the ordinary course of its business. The Company
assesses potential liabilities in connection with these lawsuits and threatened lawsuits under SFAS No. 5. The Company accrues an estimated loss for these
loss contingencies if both of the following conditions are met: information available prior to issuance of the financial statements indicates that it is probable
that a liability has been incurred at the date of the financial statements and the amount of loss can be reasonably estimated. As of January 31, 2009, the
Company has not accrued any liability for any lawsuits filed against the Company as the conditions for accrual have not been met. The Company expenses
legal costs as they are incurred.
Facilities Leases
The Company's corporate headquarters consists of two buildings located in Alviso, California, which are used for administrative, sales and marketing,
customer service, and product research and development activities. On April 27, 2006, the Company entered into the First Amendment to Lease Agreement,
dated as of February 1, 2006, which amends the Lease Agreement, dated as of October 6, 1999. Under the Amendment, the Company extended for an
additional three years, from March 9, 2007 to January 31, 2010, the original Lease Agreement. Under the terms of the Amendment, monthly rent is
approximately $165,000 with built-in base rent escalations periodically throughout the lease term. The lease is classified as an operating lease.
Additionally, the Company delivered a letter of credit totaling $477,000, to the landlord as collateral for performance by the Company of all of its
obligations under the lease. The letter of credit is to remain in effect the entire term of the lease, but the amount does decrease over time. The Company also
has operating leases for sales and administrative office space in New York City, New York and Chicago, Illinois.
Rent expense is recognized using the straight-line method over the lease term and for fiscal years ended January 31, 2009, 2008, and 2007 was $2.3
million, $2.1 million, and $2.1 million, respectively. Operating lease cash payments for the fiscal years ended January 31, 2009, 2008, and 2007 were $3.0,
$3.1 million, and $1.8 million, respectively. Future minimum operating lease payments as of January 31, 2009, are as follows:
Fiscal Year Ending Lease Payments
(In thousands)
January 31, 2010 $ 2,454
12. STOCKHOLDERS EQUITY
Common Stock
On September 11, 2006, the Company sold 8,264,463 shares of its common stock to institutional investors at $7.865 per share. The shares were
registered pursuant to the Company's $100 million universal shelf registration statement on Form S-3 (File No. 333-113719). The net proceeds from this sale
were approximately $64.5 million after deducting the Company's offering expenses of $442,000.
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