Electronic Arts 2015 Annual Report Download - page 154

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The following table summarizes our interest expense recognized for fiscal years 2015, 2014, and 2013 that is
included in interest and other income (expense), net on our Consolidated Statements of Operations (in millions):
Year Ended March 31,
2015 2014 2013
Amortization of debt discount ......................................... $(22) $(21) $(20)
Amortization of debt issuance costs ..................................... (3) (3) (3)
Coupon interest expense .............................................. (5) (5) (5)
Other interest expense ................................................ (1) (1) (1)
Total interest expense .............................................. $(31) $(30) $(29)
(13) COMMITMENTS AND CONTINGENCIES
Lease Commitments
As of March 31, 2015, we leased certain facilities, furniture and equipment under non-cancelable operating lease
agreements. We were required to pay property taxes, insurance and normal maintenance costs for certain of these
facilities and any increases over the base year of these expenses on the remainder of our facilities.
Development, Celebrity, League and Content Licenses: Payments and Commitments
The products we produce in our studios are designed and created by our employee designers, artists, software
programmers and by non-employee software developers (“independent artists” or “third-party developers”). We
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, but are not limited to: FIFA (Fédération Internationale de
Football Association), FIFPRO Foundation, FAPL (Football Association Premier League Limited), and DFL
Deutsche Fußball Liga GmbH (German Soccer League) (professional soccer); Dr. Ing. h.c. F. Porsche AG,
Ferrari S.p.A. (Need For Speed and Real Racing games); National Basketball Association (professional
basketball); PGA TOUR (professional golf); National Hockey League and NHL Players’ Association
(professional hockey); National Football League Properties, PLAYERS Inc., and Red Bear Inc. (professional
football); Zuffa, LLC (Ultimate Fighting Championship); ESPN (content in EA SPORTS games); Hasbro, Inc.
(certain of Hasbro’s board game intellectual properties); Disney Interactive (Star Wars); Fox Digital
Entertainment, Inc. (The Simpsons); and Universal Studios Inc. (Minions). 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.
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