NTAP » Topics » Nonrecourse Lease

This excerpt taken from the NTAP 10-Q filed Sep 3, 2008.
Nonrecourse Lease
We have both recourse and nonrecourse lease financing arrangements with third party leasing companies through preexisting relationships with customers. Under the terms of recourse leases, which are generally three years or less, we remain liable for the aggregate unpaid remaining lease payments to the third party leasing company in the event that any customers default. For these recourse arrangements, revenues on the sale of our product to the leasing company are deferred and recognized into income as payments to the leasing company come due. As of July 25, 2008, and April 25, 2008, the maximum recourse exposure under such leases totaled approximately $23,671 and $24,842, respectively. Under the terms of the nonrecourse leases, we do not have any continuing obligations or liabilities. To date, we have not experienced material losses under both lease financing programs.


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