Case 2:12-cv-02830-JPM-tmp Document 29-4 Filed 01/07/13 Page 1 of 8 PageID 224
`
`
`
`Exhibit B
`
`

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`1/6/13
`
`Case 2:12-cv-02830-JPM-tmp Document 29-4 Filed 01/07/13 Page 2 of 8 PageID 225
`Form 10-K
`10-K 1 d260164d10k.htm FORM 10-K
`
`UNITED STATES
`SECURITIES AND EXCHANGE COMMISSION
`Washington, D.C. 20549
`
`FORM 10-K
`
`
`Google Inc.
`
`(Exact name of registrant as specified in its charter)
`
`(Mark One)
`x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
`For the fiscal year ended December 31, 2011
`OR
`¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
`Commission file number: 000-50726
`
`Table of Contents
`
`
`
`
`
`
`
`
`
`
`
`
`Delaware
`(State or other jurisdiction of
`incorporation or organization)
`
`
`
`
`
`
`
`Title of each class
`Class A Common Stock, $0.001 par value
`
`
`1600 Amphitheatre Parkway
`Mountain View, CA 94043
`(Address of principal executive offices) (Zip Code)
`(650) 253-0000
`(Registrant’s telephone number, including area code)
`
`Securities registered pursuant to Section 12(b) of the Act:
`Name of each exchange on which
`registered
`Nasdaq Stock Market LLC
`(Nasdaq Global Select Market)
`
`Securities registered pursuant to Section 12(g) of the Act:
`Title of each class
`Class B Common Stock, $0.001 par value
`Options to purchase Class A Common Stock
`Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities
`Act. Yes x No ¨
`Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of
`the Act. Yes ¨ No x
`Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of
`the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant
`was required to file such reports), and (2) has been subject to such filing requirements for the past 90
`days. Yes x No ¨
`Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website,
`if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T
`(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required
`to submit and post such files). Yes x No ¨
`Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this
`chapter) is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive
`proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this
`Form 10-K. ¨
`www.sec.gov /Archiv es/edgar/data/1288776/000119312512025336/d260164d10k.htm
`
`77-0493581
`(I.R.S. Employer
`Identification No.)
`
`
`
`
`
`1/103
`
`

`
`Case 2:12-cv-02830-JPM-tmp Document 29-4 Filed 01/07/13 Page 3 of 8 PageID 226
`
`Table of Contents
`
`The following table presents our unaudited quarterly results of operations as a percentage of revenues for the
`eight quarters ended December 31, 2011:
`
`
`
`Quarter Ended
`Dec 31,
`Sep 30,
`Jun 30,
`Dec 31,
`Mar 31,
`Sep 30,
`Jun 30,
`Mar 31,
`2011
`2011
`2011
`2010
`2010
`2010
`2010
`2011
`
`
`
`
`
`
`
`
` 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
`
`
`
`
`
`
`
`
` 36.2
` 36.2
` 35.0
` 34.9
` 34.2
` 35.1
` 34.8
` 35.0
` 12.1
` 13.2
` 13.6
` 12.5
` 14.3
` 13.7
` 14.4
` 12.3
` 9.0
` 9.2
`9.1
`
` 10.7
` 12.0
` 12.1
` 12.4
` 12.0
` 6.0
` 6.7
`
`7.3
` 6.6
` 6.9
` 7.2
`6.9
`
` 7.6
`
`
`
`0
`
` 63.3
` 36.7
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`0
`
` 65.3
` 34.7
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`0
`
` 65.0
` 35.0
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`0
`
` 64.7
` 35.3
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
` 5.8
` 73.2
` 26.8
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`0
`
` 68.1
` 31.9
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`0
`
` 68.5
` 31.5
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`0
`
` 66.9
` 33.1
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`Revenues
`Costs and expenses:
`Cost of revenues
`Research and development
`Sales and marketing
`General and administrative
`Charge related to the
`resolution of Department
`of Justice investigation
`Total costs and expenses
`Income from operations
`Interest and other income
`(expense), net
`Income before income taxes
`Provision for income taxes
`Net income
`
`(0.1)
`
`3.1
`
` 2.3
` 1.1
` 1.9
`2.2
`
` 1.0
` 0.3
` 33.0
` 34.6
` 34.2
` 27.9
` 37.2
` 37.2
` 35.7
` 37.0
` 7.4
`6.5
`
` 6.4
` 6.9
` 7.1
`7.5
`
` 8.7
` 8.1
` 28.9% 27.0% 29.7% 30.1% 21.0% 27.8% 28.1% 25.6%
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
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`
`
`
`
`
`
`
`
`
`
`
`
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`
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`
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`
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`
`
`
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`
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`
`
`
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`
`
`
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`
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`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`Year Ended December 31,
`2010
`2009
`
`
`
`$ 9,316
`$ 11,081
` (8,019)
` (10,680)
`
`233
` 3,050
`
`
`2011
`
`$ 14,565
` (19,041)
`
`807
`
`Liquidity and Capital Resources
`In summary, our cash flows are as follows (in millions):
`
`
`
`
`Net cash provided by operating activities
`Net cash used in investing activities
`Net cash provided by financing activities
`
`At December 31, 2011, we had $44.6 billion of cash, cash equivalents, and marketable securities. Cash
`equivalents and marketable securities are comprised of time deposits, money market and other funds, including cash
`collateral received related to our securities lending program, highly liquid debt instruments of the U.S. government and
`its agencies, debt instruments issued by foreign governments, and municipalities in the U.S., corporate securities,
`and mortgage-backed securities.
`
`As of December 31, 2011, $21.2 billion of the $44.6 billion of cash, cash equivalents, and marketable securities
`was held by our foreign subsidiaries. If these funds are needed for our operations in the U.S., we would be required to
`accrue and pay U.S. taxes to repatriate these funds. However, our intent is to permanently reinvest these funds
`outside of the U.S. and our current plans do not demonstrate a need to repatriate them to fund our U.S. operations.
`
`Our principal sources of liquidity are our cash, cash equivalents, and marketable securities, as well as the cash
`flow that we generate from our operations. At December 31, 2011, we had unused letters of credit for approximately
`$46 million. We believe that our sources of funding will be sufficient to satisfy our currently anticipated cash
`requirements through at least the next 12 months. Our liquidity could be negatively affected by a decrease in demand
`for our products and services. In addition, we may make acquisitions or license products and technologies
`complementary to our business and may need to raise additional capital through future debt or equity financing to
`provide for greater flexibility to fund any such acquisitions and licensing activities. Additional financing may not be
`available at all or on terms favorable to us.
`
`
`39
`
`

`
`Case 2:12-cv-02830-JPM-tmp Document 29-4 Filed 01/07/13 Page 4 of 8 PageID 227
`
`Table of Contents
`
`Google Inc.
`CONSOLIDATED BALANCE SHEETS
`(In millions, except share and par value amounts which are reflected in thousands,
`and par value per share amounts)
`
`Assets
`Current assets:
`Cash and cash equivalents
`Marketable securities
`Total cash, cash equivalents, and marketable securities (including
`securities loaned of $4,031 and $2,778)
`Accounts receivable, net of allowance of $101 and $133
`Receivable under reverse repurchase agreements
`Deferred income taxes, net
`Prepaid revenue share, expenses and other assets
`Total current assets
`Prepaid revenue share, expenses and other assets, non-current
`Deferred income taxes, net, non-current
`Non-marketable equity securities
`Property and equipment, net
`Intangible assets, net
`Goodwill
`Total assets
`Liabilities and Stockholders’ Equity
`Current liabilities:
`Accounts payable
`Short-term debt
`Accrued compensation and benefits
`Accrued expenses and other current liabilities
`Accrued revenue share
`Securities lending payable
`Deferred revenue
`Income taxes payable, net
`Total current liabilities
`Long-term debt
`Deferred revenue, non-current
`Income taxes payable, non-current
`Deferred income taxes, net, non-current
`Other long-term liabilities
`Commitments and contingencies
`Stockholders’ equity:
`Convertible preferred stock, $0.001 par value per share, 100,000 shares
`authorized; no shares issued and outstanding
`Class A and Class B common stock and additional paid-in capital,
`$0.001 par value per share: 9,000,000 shares authorized; 321,301
`(Class A 250,413, Class B 70,888) and par value of $321 (Class A
`$250, Class B $71) and 324,895 (Class A 257,553, Class B 67,342)
`and par value of $325 (Class A $258, Class B $67) shares issued and
`outstanding
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`As of
`December 31,
`2010
`
`
`
`
`
`
`13,630
`21,345
`
`As of
`December 31,
`2011
`
`
`
`$
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$
`
`
`
`
`
`$
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`9,983
`34,643
`
`
`
`
`
`44,626
`5,427
`745
`215
`1,745
`52,758
`499
`0
`790
`9,603
`1,578
`7,346
`72,574
`
`
`
`
`
`588
`1,218
`1,818
`1,370
`1,168
`2,007
`547
`197
`8,913
`2,986
`44
`1,693
`287
`506
`
`
`
`0
`
`20,264
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`34,975
`4,252
`750
`259
`1,326
`41,562
`442
`265
`523
`7,759
`1,044
`6,256
`57,851
`
`
`483
`3,465
`1,410
`961
`885
`2,361
`394
`37
`9,996
`0
`35
`1,200
`0
`379
`
`
`
`
`
`
`
`
`
`0
`
`18,235
`
`
`
`

`
`Case 2:12-cv-02830-JPM-tmp Document 29-4 Filed 01/07/13 Page 5 of 8 PageID 228
`Form 10-K
`
`Google Inc.
`CONSOLIDATED STATEMENTS OF INCOME
`(In millions, except per share amounts)
`
`Year Ended December 31,
`
`
`2009
`2010
`2011
`
`
`
`
`
`
` $23,651 $29,321 $37,905
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
` 8,844
`
` 10,417
`
` 13,188
`
` 2,843
`
` 3,762
`
` 5,162
`
` 1,984
`
` 2,799
`
` 4,589
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
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`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
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`
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`
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`
`
`
`
`
`
`
`
`Table of Contents
`
`
`
` 2,724
` 1,962
` 1,668
`
`
`500
`
`0
`
`0
`
` 26,163
` 18,940
` 15,339
`
` 11,742
` 10,381
` 8,312
`
`
`584
`
`415
`
`69
`
` 12,326
` 10,796
` 8,381
`
` 2,589
` 2,291
` 1,861
`
` $ 6,520 $ 8,505 $ 9,737
`
`
`
` $ 20.62 $ 26.69 $ 30.17
` $ 20.41 $ 26.31 $ 29.76
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`Revenues
`Costs and expenses:
`Cost of revenues (including stock-based compensation expense of $47,
`$67, $249)
`Research and development (including stock-based compensation
`expense of $725, $861, $1,061)
`Sales and marketing (including stock-based compensation expense of
`$231, $261, $361)
`General and administrative (including stock-based compensation expense
`of $161, $187, $303)
`Charge related to the resolution of Department of Justice investigation
`Total costs and expenses
`Income from operations
`Interest and other income, net
`Income before income taxes
`Provision for income taxes
`Net income
`Net income per share of Class A and Class B common stock:
`Basic
`Diluted
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
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`
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`
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`
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`
`
`
`
`
`
`
`
`
`
`
`
`See accompanying notes.
`
`52
`
`www.sec.gov /Archiv es/edgar/data/1288776/000119312512025336/d260164d10k.htm
`
`58/103
`
`

`
`1/6/13
`
`Case 2:12-cv-02830-JPM-tmp Document 29-4 Filed 01/07/13 Page 6 of 8 PageID 229
`Form 10-K
`
`Table of Contents
`
`appeal with the IRS for certain issues related to this audit and no resolution of the issues has been achieved at this
`time, but we believe we have adequately provided for these items and any adverse results would have an immaterial
`impact on our unrecognized tax benefit balance within the next 12 months. The IRS is currently in examination of our
`2007, 2008, and 2009 tax years. We do not expect the examination to be completed within the next 12 months.
`Therefore, we do not anticipate any significant impact to our unrecognized tax benefit balance in 2012, related to our
`2007, 2008, and 2009 tax years.
`
`Our 2010 and 2011 tax years remain subject to examination by the IRS for U.S. federal tax purposes, and our
`2003 through 2011 tax years remain subject to examination by the appropriate governmental agencies for Irish tax
`purposes. There are various other ongoing audits in various other jurisdictions that are not material to our financial
`statements.
`
`Note 16. Information about Geographic Areas
`Our chief operating decision-makers (i.e., chief executive officer and his direct reports) review financial
`information presented on a consolidated basis, accompanied by disaggregated information about revenues by
`geographic region for purposes of allocating resources and evaluating financial performance. There are no segment
`managers who are held accountable by our chief operating decision-makers, or anyone else, for operations, operating
`results, and planning for levels or components below the consolidated unit level. Accordingly, we consider ourselves
`to be in a single reporting segment and operating unit structure.
`
`Revenues by geography are based on the billing addresses of our customers. The following tables set forth
`revenues and long-lived assets by geographic area (in millions):
`
`Year Ended December 31,
`
`2009
`2010
`2011
`
`
`
`
`
`
`
`
` $11,194 $14,056 $17,560
` 4,057
` 2,986
` 3,329
`
` 9,471
` 11,936
` 16,288
`
` $23,651 $29,321 $37,905
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$15,963
` 3,853
`$19,816
`
`
`
`
`Revenues:
`United States
`United Kingdom
`Rest of the world
`Total revenues
`
`
`
`
`Long-lived assets:
`United States
`International
`Total long-lived assets
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`As of December 31,
`2010
`2011
`
`
`
`$14,000
` 2,289
`$16,289
`
`
`
`
`
`82
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`www.sec.gov /Archiv es/edgar/data/1288776/000119312512025336/d260164d10k.htm
`
`94/103
`
`

`
`1/6/13
`
`Case 2:12-cv-02830-JPM-tmp Document 29-4 Filed 01/07/13 Page 7 of 8 PageID 230
`Form 10-K
`
`Table of Contents
`
`Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has
`duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly
`authorized.
`
`SIGNATURES
`
`Date: January 26, 2012
`
`
`GOOGLE INC.
`/S/ LARRY PAGE
`By:
`Larry Page
`
`Chief Executive Officer
`
`
`POWER OF ATTORNEY
`
`KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes
`and appoints Larry Page and Patrick Pichette, jointly and severally, his or her attorney-in-fact, with the power of
`substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K
`and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and
`Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his or her substitute
`or substitutes, may do or cause to be done by virtue hereof.
`
`Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has
`been signed below by the following persons on behalf of the registrant and in the capacities and on the dates
`indicated.
`
`
`Signature
`/S/ LARRY PAGE
`Larry Page
`
`/S/ PATRICK PICHETTE
`Patrick Pichette
`
`
`Eric Schmidt
`/S/ SERGEY BRIN
`Sergey Brin
`/S/ L. JOHN DOERR
`L. John Doerr
`/S/ DIANE B. GREENE
`Diane B. Greene
`/S/ JOHN L. HENNESSY
`John L. Hennessy
`/S/ ANN MATHER
`Ann Mather
`/S/ PAUL S. OTELLINI
`Paul S. Otellini
`/S/ K. RAM SHRIRAM
`K. Ram Shriram
`
`
`
`
`
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`
`
`Title
`Chief Executive Officer, Co-Founder and
`Director (Principal Executive Officer)
`Senior Vice President and Chief
`Financial Officer (Principal Financial
`and Accounting Officer)
`Executive Chairman
`
`Co-Founder and Director
`
`Director
`
`Director
`
`Director
`
`Director
`
`Director
`
`Director
`
`Date
`January 26, 2012
`
`January 26, 2012
`
`January 26, 2012
`
`January 26, 2012
`
`January 26, 2012
`
`January 26, 2012
`
`January 26, 2012
`
`January 26, 2012
`
`January 26, 2012
`
`
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`
` Director
`www.sec.gov /Archiv es/edgar/data/1288776/000119312512025336/d260164d10k.htm
`
` January 26, 2012
`
`98/103
`
`

`
`1/6/13
`
`Case 2:12-cv-02830-JPM-tmp Document 29-4 Filed 01/07/13 Page 8 of 8 PageID 231
`Form 10-K
` Director
`/S/ SHIRLEY M. TILGHMAN
` January 26, 2012
`Shirley M. Tilghman
`
`
`
`www.sec.gov /Archiv es/edgar/data/1288776/000119312512025336/d260164d10k.htm
`
`99/103