Commitments and Contingencies

Letters of Credit

As described in Note 11, a portion of our Revolver can be used to issue letters of credit of up to $50 million, subject to the availability of the Revolver. At December 31, 2016, we did not have any letters of credit issued or outstanding under the Revolver.

Commitments

In the normal course of business, we enter into contractual arrangements with third parties for non-cancelable operating lease agreements for our offices, for the development of products and for the rights to intellectual property. Under these agreements, we commit to provide specified payments to a lessor, developer or intellectual property holder, as the case may be, based upon contractual arrangements. The payments to third-party developers are generally conditioned upon the achievement by the developers of contractually specified development milestones. Further, these payments to third-party developers and intellectual property holders typically are deemed to be advances and, as such, are recoupable against future royalties earned by the developer or intellectual property holder based on sales of the related game. Additionally, in connection with certain intellectual property rights, acquisitions and development agreements, we commit to spend specified amounts for marketing support for the game(s) which is (are) to be developed or in which the intellectual property will be utilized. Assuming all contractual provisions are met, the total future minimum commitments for these and other contractual arrangements in place at December 31, 2016 are scheduled to be paid as follows (amounts in millions):



	Contractual Obligations (1)
	Facility and Equipment Leases		Developer and Intellectual Properties		Marketing		Long-Term Debt Obligations (2)		Total
For the years ending December 31,
2017	$	65	$	196	$	53	$	145	$	459
2018	59		160		15		145		379
2019	52		1		—		247		300
2020	44		—		—		393		437
2021	32		—		—		3,101		3,133
Thereafter	92		—		—		1,815		1,907
Total	$	344	$	357	$	68	$	5,846	$	6,615

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(1)

We have omitted uncertain income tax liabilities from this table due to the inherent uncertainty regarding the timing of the potential issue resolution of the underlying matters. Specifically, either (a) the underlying positions have not been fully developed under audit to quantify at this time or, (b) the years relating to the matters for certain jurisdictions are not currently under audit. At December 31, 2016, we had $587 million of net unrecognized tax benefits included in "Other liabilities" in our consolidated balance sheet.

(2)

Long-term debt obligations represent our obligations related to the contractual principal repayments and interest payments under the 2016 TLA, 2023 Notes, and the New Notes as of December 31, 2016. There was no outstanding balance under our Revolver as of December 31, 2016. The 2023 Notes and the New Notes are subject to fixed interest rates and we have calculated the interest obligation based on the applicable rates and payment dates. The 2016 TLA bears a variable interest rate and interest is payable on a monthly basis. We have calculated the expected interest obligation based on the outstanding principal balance and interest rate applicable at December 31, 2016. Refer to Note 11 for additional information on our debt obligations.

Legal Proceedings

We are party to routine claims, suits, investigations, audits, and other proceedings arising from the ordinary course of business, including with respect to intellectual property rights, contractual claims, labor and employment matters, regulatory matters, tax matters, unclaimed property matters, compliance matters, and collection matters. In the opinion of management, after consultation with legal counsel, such routine claims and lawsuits are not significant and we do not expect them to have a material adverse effect on our business, financial condition, results of operations, or liquidity.

Purchase Transaction Matters

In prior periods, the Company reported on litigation related to the Purchase Transaction. During the period ended June 30, 2015, the cases were resolved and dismissed with prejudice. As part of the resolution of the claims, we received a settlement payment of $202 million in July 2015 from Vivendi, ASAC LP, and our insurers. We recorded the settlement within “Shareholders’ equity” in our consolidated balance sheet as of December 31, 2015.