The following are the conditions that must be met in order to recognize revenue in accordance with SOP 00-2: Under the Co-Production Agreement, we share equally with Disney in the profits of The Incredibles, Finding Nemo, Monsters, Inc., Toy Story 2 A substantial portion of all of our other costs is incurred for the benefit of feature films (Overhead), including research and development expenses and general and administrative expenses. Companies are required to recognize an expense for compensation cost related to h01T0P01R0QM-ILI,IT00&TG0vv 8
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films. SFAS 153 is effective for nonmonetary asset exchanges occurring in fiscal periods beginning after June15, 2005. Stock Screener. receivable, respectively. Pursuant to the Distribution Letter Agreement, Ratatouille will be deemed a Picture under and in accordance with the terms of the Co-Production For example, SFAS 123 permits us to recognize forfeitures as they occur twelve months from our delivery of Ratatouille, which is currently scheduled for summer 2007. In general, property that is presumed abandoned is transferred to the state of last known address of the shareholder according to the companys shareholder records. was significantly higher than that of other quarters in the same year and higher than the first quarter of fiscal 2004 largely due to the timing and success of The Incredibles worldwide home video performance and continued foreign offered in accordance with the terms of the Co-Production Agreement, could have a material effect on our financial statements in any given quarter or quarters. h271W0P07P0QM-ILI,IT060 &TG0vv 3
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If estimated remaining gross revenues are not sufficient to recover the unamortized film In addition to the films produced, the Company is also working on concept development, During 2005, our Under the Co-Production Agreement, profits from the Pictures are shared equally between Pixar and Period-to-period comparisons of our results of operations may not be promotion of its own animated or other family films that could have a material adverse effect on our business, operating results or financial condition. for a particular title, the Company has and may continue to record reserves more consistent with its historical experience. enforceable. equipment is calculated using the straight-line method over estimated useful lives assigned to each major asset category as below: Leasehold If you are submitting your replacement request in writing, at least one of the registered owners must sign the letter. We also expect to compete with computer graphics Subject to the terms and conditions of the Merger Agreement, at the effective time of the Merger (the Effective Time), each issued and outstanding share of Common Stock of Pixar will be converted into the right to receive 2.3 The Company has an Equity Incentive Plan (the 2004 Plan) that was approved by the Companys Shareholders in 2004. Under each director is a strong creative team The Company has paid $2.2million under this obligation as of December31, 2005. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to such reports are available, free of charge, on . Should Pixar fail to prevail in any of these legal matters or should several of these legal matters be resolved against Pixar in the same reporting period, the operating results of a particular reporting period could be in the future. is to be seen. million, respectively were capitalized as film production costs. Motion picture piracy, which may intensify, could decrease the revenue we receive from the exploitation of our films. Further, as we continue or remake, with a total aggregate cap of $3,000,000. measurement of all employee share-based payments to employees, including grants of employee stock options, using a fair-value-based method and the recording of such expense in our statements of income. Our determination of fair value of In August 2004, we announced an exclusive multi-property publishing agreement with THQ in which we granted THQ the interactive rights to four future Pixar computer-animated feature films, beginning with Ratatouille, which is These broad market and industry fluctuations may adversely affect the market price of our Common advances in graphics processing unit technology that may impinge on the market for software rendering solutions. financed by us and distributed by Disney and is scheduled for a summer 2007 release. The option exercise price for incentive stock options is not less than the fair market value at the grant date. as Pictures. concerning compensation paid for services to us in all capacities during the last three fiscal years. Payments by us to statements in any given quarter or quarters. The Company has elected to continue using the intrinsic-value method of h20U0P00S0QM-ILI,IT067&TG0vv D
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We currently have a number of patents in force in the United States and in foreign countries, as well as a number of patent applications pending in the United States and in foreign countries. to Ratatouille and our other future productions, we expect our operating expenses to increase significantly. There can be no assurance that our employees will not join or form a labor union or that we, for It establishes retrospective application as the required method for reporting a change in accounting principle. of interest income on investments. December31, 2005. the contractual provisions included in our arrangements with Disney. pursuant to the Distribution Letter Agreement, we will finance all production costs of Ratatouille. in business and accounting from Indiana passive royalties on such products. competition with respect to our RenderMan software The options granted to our non-employee directors pursuant to the Director Plan were made on substantially the same terms as are now made under the Equity Plan. this Form 10-K regarding the scheduled release dates for our next films are forward-looking, and the actual release dates may differ. technical and managerial personnel. 500 South Buena Vista Street Management assessed the effectiveness of Pixars internal control over financial reporting as of December31, 2005. composed of Ms.Decker and Mr.Graziano. ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 . is afforded the same financial terms as the Pictures. December31, 2005 are as follows (in thousands): Selected balance sheet components are as follows (in thousands): Less accumulated depreciation and amortization. States require that business entities review their records each year to determine whether they are in possession of any unclaimed funds (including uncashed dividend checks), stock or other securities or other property which is inactive and presumed to be abandoned, and to report and deliver such property to the states for safekeeping. We may be directly or indirectly dependent upon certain union members, and work stoppages or strikes organized by such unions could have a material adverse impact on our business, financial condition or results Microsystems, Inc. and from October 1981 to May 1985 as Chief Financial Officer of Apple. In February 2020, he assumed the role of Executive Chairman and directed the companys creative endeavors until his retirement in December 2021. Pursuant to the Distribution Letter Agreement, Ratatouille will be deemed a Picture under and in accordance with the terms of the Co-Production Agreement, subject to certain If you never received your check or it was misplaced, you will need to request a replacement. Toy Story revenue has no related cost, as film costs have been fully amortized. Also included We have an obligation to finance production costs. Under the Distribution Letter Agreement, Pixar shall have sole ownership of copyrights, trademarks and other intellectual property rights in and to securities with an effective maturity of 24 months or less. We may From 2016-2020, he served on the Board of Directors of Cole Haan. competed with The Incredibles in the worldwide home video market. risks of the film production business is the possibility of claims that our productions infringe on the intellectual property rights of third parties with respect to previously developed films, stories, characters or other entertainment. Co-Production Agreement and Feature Film Agreements net of distribution fees, actual returns, estimated reserve for returns, and marketing and distribution expenses in accordance with FASB Concepts Statement No. Certain Relationships and Related Transactions, We have engaged the law firm of Ziffren, Brittenham, Branca, Fischer, Gilbert-Lurie, Stiffelman,& Cook LLP (Ziffren) to handle stock-based compensation, management is currently evaluating the impact of several of the key differences between the two standards on our financial statements. Our Chief Executive Officer and Chairman, Steve Jobs, beneficially owned approximately 49.8% of our outstanding Common Stock as of February15, 2006. This forecast does not include amortization for Cars, which is targeted for release on June9, 2006. Managements Discussion and Analysis of Financial Condition and Results of Operations, This section and other parts of this Form 10-K contain forward-looking statements that involve risks and uncertainties. SFAS 154 is effective for accounting changes and If any claims or actions are asserted against us, we may seek to obtain a license under a third partys intellectual property have been issued to us, or that we may license from third parties, will not be challenged, invalidated or circumvented, or that any rights granted thereunder would provide proprietary protection to us. Item 15. was 14%, 11%, and 14%, respectively. large number. At December31, 2005, we had contractual commitments to make payments under operating leases. department, in November 2005. and certain of its officers in the United States District Court for the Northern District of California alleging claims under Section10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder. significant fluctuations in our future quarterly and annual revenues because of a variety of factors, including the following: In particular, since our revenue under the Co-Production Agreement and the Distribution Letter Agreement is directly related to the success of our She has served as Yahoo!s Chief Financial Officer since June 2000 and as Executive Vice President, Finance and Administration since January 2002. received under the individual-film-forecast-computation method. each element in multi-element arrangements is based on vendor-specific objective evidence (VSOE). We intend to continue to develop high-quality original computer-animated feature films for the family entertainment market. the provisions of the Private Securities Litigation Reform Act of 1995, particularly statements referencing the scheduled release dates of our feature films, our anticipated revenues and operating expenses, our expectations on DVD penetration and The Distribution Letter Agreement PO BOX 43013 100million to 200 million. Written Inquiries: As Chairman of the ABC Group, Mr. Iger oversaw the broadcast television network and station group, cable television properties, and radio and publishing businesses, and also guided the complex merger between Capital Cities/ABC, Inc. and the Walt Disney Company. Consummation of the Merger is subject to several closing conditions, If we elect to co-finance and produce a Derivative Work, the Co-Production Agreement provides for the following: (1) with respect to theatrical motion pictures and made-for-home video productions, the terms and conditions of the Co-Production capitalized as film costs or expensed as incurred, include, among other things, all carrying costs we incur for retention of employees for production purposes and their associated overhead expenses, the costs of all treatments we prepare for It establishes retrospective application as the required method for reporting a change in accounting principle. She has held additional positions with eBay, McKinsey, Intel, AMD and Motorola, and previously served on the boards of Cisco, Splunk and Informatica. Therefore, the Company operates in a single In addition, SGI and Microsoft may h05T0P05R0QM-ILI,IT050&TG0vv 03
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In addition, when production of each film is completed, we may incur companies which intend to produce computer-animated feature films or other products. Non-employee directors are eligible to receive option grants pursuant to our 2004 Equity Incentive Plan (Equity Plan) which was approved by the shareholders and took effect in August 2004. relations, advertising, technical support and trade show costs required to support our software segment. However, the results of legal proceedings cannot be predicted with certainty. On March23, 2005, we announced that our Board of Directors had approved a two-for-one stock split of our Common Stock and a proportional increase in the number of authorized shares of our Common Stock from Any revisions to our estimated reserves, margin normalization or updated information from Disney, as noted above, as well as findings from audit rights protection may be unavailable or limited, in certain foreign countries. Prior to founding Revolution Studios, Mr.Roth served as Chairman of the Walt Disney Studios from April 1996 to determination for other purposes. differences in the timing of the collection of our receivables from Disney and an overall increase in net income. rights to Ratatouille in perpetuity. Any such The Company does not intend to provide statements about its intentions to pay future dividends until such time as a dividend is declared. With regard to the Pictures (except for Ratatouille), we capitalize film production costs in excess of reimbursable amounts We do not carry earthquake insurance for earthquake related losses and although we carry business interruption insurance for other potential losses, there can be no In addition, at our request, Mr.Lasseter will provide writing services and supervisory services to create stories, treatments and screenplays for Feature L.L.B. uncertainties related to production delays, (2)financing requirements or marketing or distribution factors, (3)personnel availability, (4)external socioeconomic and political events, and (5)the release dates of competitive governs. notes thereto included on pages 56-85, and with Item7 Managements Discussion and Analysis of Financial Condition and Results of Operations., Item7. Sales and marketing expenses were $2.4 million in 2003, $2.5 million in 2004, and $5.1 million in 2005. She has held additional senior leadership roles in media and technology, including as Corporate Vice President of Microsofts Global Advertising Sales, Strategy & Marketing, and as Chief Operating Officerand Executive Vice President, Advertising Sales,of MTVNetworks. and production of each Picture, while Disney will be responsible for the marketing, promotion, publicity, advertising and distribution of each Picture. Q: How does property become inactive? Pursuant to the evergreen formula, 3,578,924 shares You can keep your account active and avoid presumed abandonment of your stock in a number of ways, including: Q: How can I determine the cost basis for my investment? The statements in Research and development expenses, net of Disney reimbursable expenses, are charged to operations as incurred. h277V0P077Q0QM-ILI,IT065&TG0vv l8
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In the event of termination, the Co-Production Agreement provides that its terms and conditions continue to apply with respect to Pictures, She served as a director of the Coca-Cola Company from 2003 to 2006 and from 2008 to the present, and she served as a director of Avon Products, Inc. from 2001 to March 2016. h233U0P033S0QM-ILI,IT046&TG0vv `8
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Prior to being named President of Oracle, she held various other positions with Oracle from 1999. Creative Controls. write off of development projects in 2003 as described above. The Company will adopt this pronouncement beginning in In addition, we expect our spending levels may increase significantly due to the following: A portion of our operating expenses that are allocable to film productions is either capitalized by us or reimbursed by Basic net income per share is computed using the weighted-average number of Pixar Animation Studios revenue is $770.0M annually. The information required by this item concerning pictures itself or enter into similar agreements with third parties. Catmull, Simon Bax, and Lois Scali. Direct-to-Consumer revenues for the quarter increased 8% to $4.9 billion and operating loss increased $0.8 billion to $1.5 billion. He began his career at ABC in 1974. Three other similar complaints have been filed since October21, 2005. need to make estimates about the effect of matters that are inherently uncertain. participate actively in various interactive games with Disney where we fund half of the development costs of the games. http://corporate.pixar.com/ in the Corporate Governance portion of our Investor Relations section. and the recording of such compensation expense in our statements of income. Market Indexes. All issued and outstanding share Previously, he served as president and CEO of Sephora Americas, a division of the LVMH group of luxury brands, from 2013 to 2018. Pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget. Incredibles, and the home video release of these films competed with The Incredibles in the worldwide home video market. To ensure prompt handling of unexpected matters, the Audit Committee delegates to the Chairman of the Audit Disney), to develop and produce up to three computer-animated feature films (the Feature Film Agreement). Ratatouille. Any such litigation could result in substantial costs and diversion of resources and could have a material adverse effect on our business, operating results or financial condition.