Western Digital 2011 Annual Report Download - page 44

building associated with the acquisition of a semiconductor wafer fabrication facility, offset by $3 million of sales related
to our auction-rate securities. During 2009, cash used in investing activities consisted primarily of $519 million for
capital expenditures and $63 million for the acquisition of SiliconSystems, net of cash acquired, partially offset by
$29 million in proceeds from the sale of property and equipment. Capital expenditures in 2011 primarily consisted of the
expansion of our head wafer fabrication facilities, continued investment in advanced head technologies and increased
capacity for our broadening and growing product portfolio.
For fiscal 2012, we expect capital expenditures will be at the upper end of our business model range of between 7 and
8 percent of revenue as we continue the conversion of our head wafer fabrication facilities to utilize 8-inch wafers from
6-inch wafers. We expect depreciation and amortization to be approximately $650 million for fiscal 2012.
Our cash equivalents are invested in highly liquid money market funds that are invested in U.S. Treasury securities,
U.S. Treasury bills and U.S. Government agency securities. We also have $15 million of auction-rate securities, which are
classified as available-for-sale securities.
Financing Activities
Net cash used in financing activities for 2011 was $106 million as compared to $16 million for 2010 and
$64 million for 2009. Net cash used in financing activities for 2011 consisted of $106 million used to repay long-term
debt and $50 million used to repurchase shares of our common stock, offset by a net $50 million related to employee
stock plans. Net cash used in financing activities for 2010 consisted of $82 million used to repay long-term debt,
partially offset by a net $66 million provided by employee stock plans. Net cash used in financing activities for 2009
consisted of $36 million used to repurchase shares of our common stock, $27 million used to repay long-term debt and a
net $1 million used by employee stock plans.
Off-Balance Sheet Arrangements
Other than facility lease commitments incurred in the normal course of business and certain indemnification
provisions (see “Contractual Obligations and Commitments” below), we do not have any off-balance sheet financing
arrangements or liabilities, guarantee contracts, retained or contingent interests in transferred assets, or any obligation
arising out of a material variable interest in an unconsolidated entity. We do not have any majority-owned subsidiaries
that are not included in the consolidated financial statements. Additionally, we do not have an interest in, or relationships
with, any special-purpose entities.
Contractual Obligations and Commitments
The following is a summary of our significant contractual cash obligations and commercial commitments as of
July 1, 2011 (in millions):
Total
Less than
1 Year 1-3 Years 3-5 Years
More than
5 Years
Long-term debt, including current
portion .................... $ 294 $ 144 $150 $ — $—
Operating leases ............... 115 18 31 20 46
Unrecognized tax benefits......... 147 — 15 132 —
Purchase obligations ............ 3,893 3,876 11 6 —
Total...................... $4,449 $4,038 $207 $158 $46
Long-Term Debt
In February 2008, WDTI, a wholly-owned subsidiary of the Company, entered into a five-year credit agreement
that provided for a $500 million term loan facility. As of July 1, 2011, the remaining balance of the term loan facility was
$294 million, which requires principal payments totaling $144 million in 2012 and $150 million in 2013. See Part II,
Item 8, Note 3 in the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K.
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