Apple 2012 Annual Report Download - page 71

Other Off-Balance Sheet Commitments
Lease Commitments
The Company leases various equipment and facilities, including retail space, under noncancelable operating lease
arrangements. The Company does not currently utilize any other off-balance sheet financing arrangements. The
major facility leases are typically for terms not exceeding 10 years and generally provide renewal options for
terms not exceeding five additional years. Leases for retail space are for terms ranging from five to 20 years, the
majority of which are for 10 years, and often contain multi-year renewal options. As of September 29, 2012, the
Company’s total future minimum lease payments under noncancelable operating leases were $4.4 billion, of
which $3.1 billion related to leases for retail space.
Rent expense under all operating leases, including both cancelable and noncancelable leases, was $488 million,
$338 million and $271 million in 2012, 2011 and 2010, respectively. Future minimum lease payments under
noncancelable operating leases having remaining terms in excess of one year as of September 29, 2012, are as
follows (in millions):
2013 ............................................................................... $ 516
2014 ............................................................................... 556
2015 ............................................................................... 542
2016 ............................................................................... 513
2017 ............................................................................... 486
Thereafter ........................................................................... 1,801
Total minimum lease payments ...................................................... $4,414
Other Commitments
As of September 29, 2012, the Company had outstanding off-balance sheet third-party manufacturing
commitments and component purchase commitments of $21.1 billion.
In addition to the off-balance sheet commitments mentioned above, the Company had outstanding obligations of
$988 million as of September 29, 2012, which were comprised mainly of commitments to acquire capital assets,
including product tooling and manufacturing process equipment, and commitments related to advertising,
research and development, Internet and telecommunications services and other obligations.
Contingencies
The Company is subject to various legal proceedings and claims that have arisen in the ordinary course of
business and have not been fully adjudicated, certain of which are discussed in Part I, Item 3 of this Form
10-K under the heading “Legal Proceedings” and in Part I, Item 1A of this Form 10-K under the heading “Risk
Factors.” In the opinion of management, there was not at least a reasonable possibility the Company may have
incurred a material loss, or a material loss in excess of a recorded accrual, with respect to loss contingencies.
However, the outcome of litigation is inherently uncertain. Therefore, although management considers the
likelihood of such an outcome to be remote, if one or more of these legal matters were resolved against the
Company in a reporting period for amounts in excess of management’s expectations, the Company’s
consolidated financial statements for that reporting period could be materially adversely affected.
Apple Inc. vs Samsung Electronics Co., Ltd, et al.
On August 24, 2012, a jury returned a verdict awarding the Company $1.05 billion in its lawsuit against Samsung
Electronics and affiliated parties in the United States District Court, Northern District of California, San Jose
Division. Because the award is subject to entry of final judgment and may be subject to appeal, the Company has
not recognized the award in its consolidated financial statements for the year ended September 29, 2012.
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