background image
typically advance development funds to the independent artists and third-party developers during development of
our games, usually in installment payments made upon the completion of specified development milestones.
Contractually, these payments are generally considered advances against subsequent royalties on the sales of the
products. These terms are set forth in written agreements entered into with the independent artists and third-party
developers.
In addition, we have certain celebrity, league and content license contracts that contain minimum guarantee
payments and marketing commitments that may not be dependent on any deliverables. Celebrities and
organizations with whom we have contracts include: FIFA, FIFPRO Foundation, FAPL (Football Association
Premier League Limited), and DFL Deutsche Fußball Liga GmbH (German Soccer League) (professional
soccer); National Basketball Association (professional basketball); PGA TOUR, Tiger Woods and Augusta
National (professional golf); National Hockey League and NHL Players' Association (professional hockey);
National Football League Properties, PLAYERS Inc., and Red Bear Inc. (professional football); Collegiate
Licensing Company (collegiate football); Zuffa, LLC (Ultimate Fighting Championship); ESPN (content in EA
SPORTS games); Hasbro, Inc. (most of Hasbro's toy and game intellectual properties); and LucasArts and Lucas
Licensing (Star Wars: The Old Republic). These developer and content license commitments represent the sum
of (1) the cash payments due under non-royalty-bearing licenses and services agreements and (2) the minimum
guaranteed payments and advances against royalties due under royalty-bearing licenses and services agreements,
the majority of which are conditional upon performance by the counterparty. These minimum guarantee
payments and any related marketing commitments are included in the table below.
The following table summarizes our minimum contractual obligations as of March 31, 2013 (in millions):
Fiscal Year Ending March 31,
Total
2014
2015
2016
2017
2018 Thereafter
Unrecognized commitments
Developer/licensor commitments . . . . . . . . . . . . . . . . . . . . $1,144 $158 $178 $228 $ 69 $53
$458
Marketing commitments . . . . . . . . . . . . . . . . . . . . . . . . . . .
223
37
47
35
20
20
64
Operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
174
50
44
32
17
13
18
0.75% Convertible Senior Notes due 2016 interest
(a)
. . . . .
17
5
5
5
2
--
--
Other purchase obligations . . . . . . . . . . . . . . . . . . . . . . . . .
39
28
9
2
--
--
--
Total unrecognized commitments . . . . . . . . . . . . . . . . . .
1,597
278
283
302
108
86
540
Recognized commitments
0.75% Convertible Senior Notes due 2016 principal
(a)
. . . .
633
--
--
--
633
--
--
Licensing and lease obligations
(b)
. . . . . . . . . . . . . . . . . . . .
71
25
18
6
20
1
1
Total recognized commitments . . . . . . . . . . . . . . . . . . . .
704
25
18
6
653
1
1
Total Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,301 $303 $301 $308 $761 $87
$541
(a)
Included in the $17 million coupon interest on the 0.75% Convertible Senior Notes due 2016 is $1 million
of accrued interest recognized as of March 31, 2013. We will be obligated to pay the $632.5 million
principal amount of the 0.75% Convertible Senior Notes due 2016 in cash and any excess conversion value
in shares of our common stock upon redemption of the Notes at maturity on July 15, 2016 or upon earlier
redemption. The $632.5 million principal amount excludes $74 million of unamortized discount of the
liability component. See Note 11 for additional information regarding our 0.75% Convertible Senior Notes
due 2016.
(b)
See Note 7 for additional information regarding recognized commitments resulting from our restructuring
plans. Lease commitments have not been reduced for approximately $6 million due in the future from third
parties under non-cancelable sub-leases.
Subsequent to March 31, 2013, we entered into various licensor and development agreements with third parties,
which contingently commits us to pay up to $164 million at various dates through fiscal year 2020.
94