Commitments And Contingencies

9 Months Ended

Sep. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Commitments And Contingencies

COMMITMENTS AND CONTINGENCIES

Guarantees and Indemnifications

The Company has made guarantees and indemnities under which it may be required to make payments to a guaranteed or indemnified party in relation to certain transactions, including revenue transactions in the ordinary course of business. In connection with certain facility leases, the Company has agreed to indemnify its lessors for certain claims arising from the facility or the lease. The Company is obligated to indemnify its directors and officers to the maximum extent permitted under the laws of the State of Delaware. However, the Company has a directors and officers insurance policy that may reduce its exposure in certain circumstances and may enable it to recover a portion of future amounts that may be payable, if any. The duration of the guarantees and indemnities varies and, in many cases, is indefinite but subject to statutes of limitations. To date, the Company has made no payments related to these guarantees and indemnities. The Company estimates the fair value of its indemnification obligations as insignificant based on this history and the Company’s insurance coverage and therefore has not recorded any liability for these guarantees and indemnities in the accompanying consolidated balance sheets.

License and Capital Lease Commitments

On January 13, 2012, the Company entered into an agreement to purchase intellectual property rights related to a software application for $0.8 million which was financed through a third-party debt agreement. Payments of approximately $0.2 million are due in 2012, 2013, 2014 and 2015.

During April 2012, the Company entered into an e-learning content reseller agreement with a third-party content provider. The Company is obligated to pay license fees under the e-learning content reseller agreement of $0.8 million in 2012, 2013 and 2014 under this agreement.

During July 2012, the Company entered into a cloud subscription agreement with a provider of enterprise cloud computing and social enterprise solutions. The Company is obligated to pay fees under this agreement of $0.6 million in 2013, $0.8 million in 2014, and $1.0 million in 2015.

During the nine months ended September 30, 2012 , the Company entered into operating leases in New Zealand, France, Germany, Italy, Spain, Denmark, Netherlands, United Kingdom, Australia, Hong Kong and California, increasing operating lease commitments by approximately $0.2 million through 2012 and $0.5 million through 2013.

During the nine months endedSeptember 30, 2012, the Company financed the purchase of equipment through capital lease agreements that increased its capital lease commitments by approximately $1.6 million through 2015.

Litigation

During the third quarter of 2012, the Company received an unfavorable ruling in an employment matter brought to arbitration. Prior to the arbitration ruling the Company determined that a material loss contingency was remote and no amounts were accrued. Based on the results of the arbitration ruling, the Company has now reasonably estimated the range of probable losses for this matter, including both the award and estimated attorneys’ fees, to be between $1.6 million and $2.0 million, and has accrued, within other current liabilities, the low end of the range as no other amount within this range was a better estimate than any other. The Company has determined that the accrued loss is covered under the Company's executive wrap insurance policy and that recovery under the policy is probable. As such, the Company has recorded an insurance receivable of $1.6 million in other current assets. There is at least a reasonable possibility that the loss for this matter could exceed the amount accrued by $0.4 million,  before consideration of potential additional recovery under its existing insurance policy. The Company believes that any additional loss above the amount accrued would not have a material adverse effect on the Company's business, operating results, cash flows and financial condition.

The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. If the Company determines that it is probable that a loss has been incurred and the amount is reasonably estimable, the Company will record a liability. Except for the matter described above, the Company has determined that it does not have a potential liability related to any legal proceedings or claims that would individually or in the aggregate materially adversely affect its financial conditions or operating results.