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34
Research฀In฀Motion฀Limited฀฀|฀฀Incorporated฀Under฀the฀Laws฀of฀Ontario฀(United฀States฀dollars,฀in฀thousands฀except฀per฀share฀data฀or฀as฀otherwise฀indicated)
35
For฀the฀years฀ended฀March฀1,฀2003,฀March฀2,฀2002฀and฀February฀28,฀2001
7.฀Acquisitions
During฀scal฀2003,฀the฀Company฀completed฀four฀acquisitions.฀Effective฀June฀2002,฀the฀Company฀
purchased฀the฀assets฀of฀a฀company฀whose฀proprietary฀software฀code฀provides฀capabilities฀to฀facilitate฀
foreign฀language฀input฀and฀display฀on฀handheld฀products.฀Effective฀July฀2002,฀the฀Company฀acquired฀
100%฀of฀the฀common฀shares฀of฀a฀company฀that฀will฀offer฀a฀secure฀solution฀for฀viewing฀email฀
attachments฀with฀BlackBerry฀Wireless฀Handhelds™.฀Effective฀August฀2002,฀the฀Company฀acquired฀
100%฀of฀the฀common฀shares฀of฀a฀company฀that฀has฀software฀products฀which฀enable฀wireless฀access฀
to฀major฀email฀systems฀including฀corporate,฀proprietary฀and฀POP3/IMAP4฀using฀a฀handheld฀device.฀
In฀addition,฀effective฀September฀2002,฀the฀Company฀also฀acquired฀100%฀of฀the฀common฀shares฀
of฀a฀small฀company฀with฀expertise฀and฀technology฀related฀to฀wireless฀networks.฀The฀results฀of฀the฀
acquirees’฀operations฀have฀been฀included฀in฀the฀consolidated฀nancial฀statements฀for฀the฀periods฀
from฀each฀respective฀closing฀date฀up฀to฀March฀1,฀2003.฀
On฀October฀31,฀2001,฀the฀Company฀acquired฀100%฀of฀the฀outstanding฀common฀shares฀of฀a฀company฀
for฀its฀technology฀and฀expertise฀in฀the฀wireless฀delivery฀of฀rich฀graphical฀content.฀This฀company฀
develops฀Java-based฀media฀platforms฀for฀wireless฀devices.฀The฀results฀of฀this฀company’s฀operations฀
have฀been฀included฀in฀the฀consolidated฀nancial฀statements฀since฀October฀31,฀2001.฀The฀value฀of฀the฀
387,353฀common฀shares฀issued฀in฀2002฀was฀determined฀based฀on฀the฀average฀of฀the฀market฀price฀of฀
the฀Company’s฀common฀shares฀over฀the฀two-day฀period฀before฀and฀after฀the฀terms฀of฀the฀acquisition฀
were฀agreed฀to.฀
The฀following฀table฀summarizes฀the฀estimated฀fair฀value฀of฀the฀assets฀acquired฀and฀liabilities฀assumed฀
at฀the฀date฀of฀acquisition.฀
฀For฀the฀year฀ended฀ ฀ ฀ ฀ March฀1,฀2003฀฀ March฀2,฀2002฀
Assets฀purchased฀ ฀ ฀
฀ Capital฀assets฀ ฀฀ ฀ $฀ 317฀฀ ฀$฀ –
฀ Acquired฀technology฀ ฀฀ ฀ ฀ 7,326฀฀ ฀฀ 2,685฀
฀ Goodwill฀ ฀฀ ฀ ฀ 16,193฀฀ ฀฀ 14,395฀
฀ ฀ ฀฀ ฀ ฀ ฀ 23,836฀฀ ฀฀ 17,080฀
Liabilities฀assumed฀–฀non-cash฀working฀capital฀ ฀ ฀ ฀ ฀1,275฀฀ ฀฀ 1,046฀
Future฀income฀tax฀liability฀ ฀ ฀฀ ฀ 357฀฀ ฀฀ –฀
฀ ฀ ฀฀ ฀ ฀ ฀ 1,632฀฀ ฀฀ 1,046฀
Net฀non-cash฀assets฀acquired฀ ฀ ฀฀ ฀ 22,204฀฀ ฀฀ 16,034฀
฀ Cash฀acquired฀ ฀฀ ฀ ฀ 117฀฀ ฀฀ 152฀
Net฀assets฀acquired฀ ฀ ฀฀ $฀ 22,321฀฀ ฀$฀ 16,186฀
Consideration฀ ฀ ฀
฀ Cash฀ ฀฀ ฀ $฀ 22,107฀฀ ฀$฀ 9,861฀
฀ Assumption฀of฀acquiree฀long-term฀debt฀ ฀ ฀ ฀ 214฀฀ ฀฀ –
฀ Capital฀stock฀ ฀฀ ฀ ฀ –฀ ฀฀ 6,325฀
฀ ฀ ฀฀ ฀ ฀ $฀ 22,321฀฀ ฀$฀ 16,186฀
The฀acquisitions฀were฀accounted฀for฀using฀the฀purchase฀method฀whereby฀assets฀acquired฀and฀
liabilities฀assumed฀were฀recorded฀at฀their฀fair฀value฀as฀of฀the฀date฀of฀acquisition.฀The฀excess฀of฀the฀
purchase฀price฀over฀such฀fair฀value฀was฀recorded฀as฀goodwill.฀Acquired฀technology฀includes฀current฀
and฀core฀technology.฀Of฀the฀$16,193฀of฀goodwill฀acquired฀during฀scal฀2003,฀$13,316฀is฀expected฀to฀be฀
deductible฀for฀tax฀purposes.฀
If฀the฀four฀scal฀2003฀acquisitions฀had฀occurred฀on฀March฀1,฀2001,฀the฀Company’s฀unaudited฀proforma฀
consolidated฀revenue฀would฀have฀increased฀by฀$226฀for฀the฀year฀ended฀March฀1,฀2003฀(2002฀–฀$816)฀
and฀the฀unaudited฀proforma฀net฀loss฀would฀have฀been฀$151,520฀(2002฀–฀$35,906).฀
฀฀ ฀