Blackberry 2003 Annual Report Download - page 52

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50
Research฀In฀Motion฀Limited฀฀|฀฀Incorporated฀Under฀the฀Laws฀of฀Ontario฀(United฀States฀dollars,฀in฀thousands฀except฀per฀share฀data฀or฀as฀otherwise฀indicated)
51
For฀the฀years฀ended฀March฀1,฀2003,฀March฀2,฀2002฀and฀February฀28,฀2001
SFAS฀No.฀123,฀Accounting฀for฀Stock-Based฀Compensation,฀requires฀proforma฀disclosures฀of฀net฀income฀and฀
earnings฀per฀share,฀as฀if฀the฀fair฀value฀based฀method฀as฀opposed฀to฀the฀intrinsic฀value฀based฀method฀
of฀accounting฀for฀employee฀stock฀options฀had฀been฀applied.฀The฀disclosures฀in฀the฀following฀table฀
show฀the฀company’s฀net฀income฀and฀earnings฀per฀share฀on฀a฀proforma฀basis฀using฀the฀fair฀value฀
method฀as฀determined฀by฀using฀the฀Black-Scholes฀option฀pricing฀model฀include:฀
For฀the฀year฀ended฀ ฀ March฀1,฀2003฀ March฀2,฀2002฀ February฀28,฀2001฀
Net฀loss฀under฀U.S.฀GAAP฀฀ $฀(148,858)฀฀ $฀ (28,321)฀฀ $฀ (7,568)฀
Estimated฀stock-based฀compensation฀costs฀฀ ฀฀ 20,296฀฀ ฀฀ 19,773฀฀ ฀ ฀11,115฀
Net฀loss฀under฀U.S.฀GAAP฀฀ $฀ (169,154)฀฀ $฀ (48,094)฀฀ $฀ (18,683)฀
Proforma฀net฀loss฀per฀common฀share฀ ฀ ฀
฀ Basic฀฀ ฀ $฀ (2.18)฀฀ $฀ (0.61)฀฀ $฀ (0.25)฀
฀ Diluted฀฀ ฀ $฀ (2.18)฀฀ $฀ (0.61)฀฀ $฀ (0.25)฀
Weighted฀average฀number฀of฀shares฀(000’s)฀ ฀ ฀
฀ Basic฀฀ ฀ 77,636฀฀ ฀ ฀78,467฀฀ ฀฀ 73,555฀
฀ Diluted฀฀ ฀฀ 77,636฀฀ ฀฀ 78,467฀฀ ฀฀ 73,555฀
The฀weighted฀average฀fair฀value฀of฀options฀granted฀during฀the฀following฀periods฀were฀calculated฀as฀
follows฀using฀the฀Black-Scholes฀option฀pricing฀model฀with฀the฀following฀assumptions:฀
For฀the฀year฀ended฀ ฀ March฀1,฀2003฀฀ ฀March฀2,฀2002฀฀ ฀February฀28,฀2001฀
Weighted฀average฀Black-Scholes฀value฀of฀options฀ ฀$฀ 8.58฀฀ ฀$฀ 12.00฀฀ ฀$฀ 34.82฀
Assumptions:฀ ฀ ฀
฀ Risk฀free฀interest฀rates฀฀ ฀ 4.5%฀ ฀ 4%฀ ฀ 4%
฀ Expected฀life฀in฀years฀฀ ฀ 3.5฀฀ ฀ 3.5฀฀ ฀ 3.5฀
฀ Expected฀dividend฀yield฀฀ ฀ 0%฀ ฀ 0%฀ ฀ 0%
฀ Volatility฀฀ ฀ 70%฀ ฀ 75%฀ ฀ 100%
฀
(f)฀Product฀Warranty฀–฀The฀change฀in฀the฀Company’s฀accrued฀warranty฀obligations฀from฀March฀2,฀2002฀
to฀March฀1,฀2003฀was฀as฀follows:
Accrued฀warranty฀obligations฀at฀March฀2,฀2002฀ ฀ ฀ ฀ ฀ $฀ 3,355
Actual฀warranty฀experience฀during฀2003฀ ฀ ฀ ฀ ฀ ฀ (577)
2003฀warranty฀provision฀ ฀ ฀ ฀ ฀ ฀ 5,465
Adjustment฀for฀changes฀in฀estimate฀ ฀ ฀ ฀ ฀ ฀ (3,073)
Accrued฀warranty฀obligations฀at฀March฀1,฀2003฀ ฀ ฀ ฀ ฀ $฀ 5,170
(g)฀Recently฀issued฀pronouncements฀–฀In฀June฀2001,฀FASB฀issued฀SFAS฀No.฀143,฀“Accounting฀for฀Asset฀
Retirement฀Obligations.”฀SFAS฀No.฀143฀requires฀the฀Company฀to฀record฀the฀fair฀value฀of฀an฀asset฀
retirement฀obligation฀as฀a฀liability฀in฀the฀period฀in฀which฀it฀incurs฀a฀legal฀obligation฀associated฀with฀
the฀retirement฀of฀tangible฀long-lived฀assets฀that฀result฀from฀the฀acquisition,฀construction,฀develop-
ment฀and/or฀normal฀use฀of฀the฀assets.฀The฀Company฀is฀required฀to฀also฀record฀a฀corresponding฀asset฀
that฀is฀depreciated฀over฀the฀life฀of฀the฀asset.฀Subsequent฀to฀the฀initial฀measurement฀of฀the฀asset฀
retirement฀obligation,฀the฀obligation฀will฀be฀adjusted฀at฀the฀end฀of฀each฀period฀to฀reect฀the฀passage฀
of฀time฀and฀changes฀in฀the฀estimated฀future฀cash฀ows฀underlying฀the฀obligation.฀The฀Company฀is฀
required฀to฀adopt฀SFAS฀No.฀143฀on฀January฀1,฀2003.฀There฀was฀no฀effect฀on฀the฀adoption฀of฀SFAS฀No.฀143฀
on฀the฀Company’s฀results฀of฀operations฀and฀nancial฀position฀for฀2003฀and฀prior฀years.