LOGITECH INTERNATIONAL SA - Shareholder.com

Table of Contents
Purchase Obligations
Purchase obligations represent an estimate of all open purchase orders and contractual obligations for capital and other expenditures, for
which the goods or services are not yet received. We had purchase obligations for manufacturing equipment, tooling and leasehold
improvements of $21.4 million as of March 31, 2007. We also had other commitments of $28.3 million for consulting, information technology
services, marketing arrangements and advertising. Although open purchase orders are considered enforceable and legally binding, the terms
generally allow the Company the option to reschedule and adjust our requirements based on business needs prior to delivery of goods or
performance of services.
Off-Balance Sheet Arrangements
The Company has not entered into any transactions with unconsolidated entities whereby we have financial guarantees, subordinated
retained interests, derivative instruments or other contingent arrangements that expose us to material continuing risks, contingent liabilities, or
any other obligation under a variable interest in an unconsolidated entity that provides financing, liquidity, market risk or credit risk support to
the Company.
Guarantees
The Company has guaranteed the purchase obligations of some of its contract manufacturers to certain component suppliers. These
guarantees have a term of one year and are automatically extended for one or more additional years as long as a liability exists. The amount of
the purchase obligations of these manufacturers varies over time, and therefore the amounts subject to Logitech’s guarantees similarly varies.
At March 31, 2007, the amount of these outstanding guaranteed purchase obligations was approximately $3.1 million. We do not believe, based
on historical experience and information currently available, that it is probable that any amounts will be required to be paid under these
guarantee arrangements.
Indemnifications
The Company indemnifies certain of its suppliers and customers for losses arising from matters such as intellectual property rights and
safety defects, subject to certain restrictions. The scope of these indemnities varies and may include indemnification for damages and expenses,
including reasonable attorneys’ fees. No amounts have been accrued for indemnification provisions as of March 31, 2007. We do not believe,
based on historical experience and information currently available, that it is probable that any amounts will be required to be paid under these
indemnification arrangements.
Research and Development
For a discussion of the Company’s research and development activities, patents and licenses, please refer to Item 4B “Business
Overview.”
Trend Information
For a discussion of significant trends in the Company’s financial condition and results of operations, please refer to Item 5 “Results of
Operations” and “Liquidity and Capital Resources.”
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
A. Directors and Senior Management
Information concerning Directors and Senior Management of Logitech appears in Section 3 “The Board of Directors” and Section 4
“Senior Management” in Exhibit 15.1 to the Form 20-F and is incorporated herein by reference.
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