COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2012

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

25. COMMITMENTS AND CONTINGENCIES

Lease Commitments

The Company leases certain facilities, vehicles and equipment principally under operating leases. Rental expense related to operating lease agreements amounted to $22.9 million, $18.1 million and $12.2 million in 2012, 2011 and 2010, respectively.

Minimum future rental payments under non-cancelable operating leases for each of the five succeeding years ending December 31 and thereafter are as follows:

	Total		2013		2014		2015		2016		2017		Thereafter
Lease obligations	$	84,201	$	21,210	$	18,028	$	12,152	$	8,738	$	7,411	$	16,662

Other Commitments

The Company had no material commitments related to capital expenditures as of December 31, 2012.

Under certain research and development agreements, the Company may be required to make payments contingent upon the achievement of specific developmental, regulatory, or commercial milestones. The Company may make contingent consideration payments of up to $200.0 million related to Valeant’s acquisition of Aton. The Company could also pay contingent consideration of up to $114.0 million, $59.9 million and $40.0 million related to acquisitions of OraPharma, iNova and University Medical, respectively. Each of these arrangements is further described in note 3. In addition, the Company may pay potential milestone payments of up to $659.3 million, in the aggregate, to third-parties as part of certain product development and license agreements assumed in connection with the Medicis acquisition.

Indemnification Provisions

In the normal course of business, the Company enters into agreements that include indemnification provisions for product liability and other matters. These provisions are generally subject to maximum amounts, specified claim periods, and other conditions and limits. As of December 31, 2012 or 2011, no material amounts were accrued for the Company’s obligations under these indemnification provisions. In addition, the Company is obligated to indemnify its officers and directors in respect of any legal claims or actions initiated against them in their capacity as officers and directors of the Company in accordance with applicable law. Pursuant to such indemnities, the Company is indemnifying certain former officers and directors in respect of certain litigation and regulatory matters.