Blackberry 2005 Annual Report Download - page 34

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32
Investing Activities
During fiscal 2005, cash flow used for investing activities equalled $878.1 million, which included the
acquisition of investments, net of proceeds on disposition, of $596.7 million, the acquisition of short-term
investments, net of proceeds on disposition, of $151.1 million, the acquisitions of capital assets and intangible
assets of $109.4 million and $17.1 million, respectively, and the acquisition of subsidiaries of $3.9 million.
During fiscal 2004, cash flow used for investing activities equalled $196.8 million, which included the
acquisition of investments, net of proceeds on disposition, of $143.2 million, and the acquisitions of capital
assets and intangible assets of $21.8 million and $32.3 million, respectively.
NTP Litigation
As discussed in “Critical Accounting Policies and Estimates – Litigation”, “Results of Operations – Litigation”
and note 15 to the Consolidated Financial Statements, RIM will pay to NTP $450 million in final and full
resolution of all claims to date against RIM, as well as for the NTP license going forward.
Prior to this resolution with NTP and commencing in the first quarter of fiscal 2004 and on a quarterly basis
thereafter, the Company has been required to deposit the current fiscal period’s enhanced compensatory
damages amount plus postjudgment interest (the “quarterly deposit”) into a bank escrow account 30 days
subsequent to the end of the quarter. These quarterly deposits were to have been set aside in escrow until the
appeals process is complete. The quarterly deposit fundings for fiscal 2004 and fiscal 2005 total $112.0 million
and are classified as Restricted cash on the Company’s consolidated balance sheet as at February 26, 2005.
The Company intends to fund this $450 million resolution amount by: i) utilizing the $112.0 million set aside
in escrow, as described above; and ii) using $338.0 million of its portfolio of cash, cash equivalents and short-
term investments as at February 26, 2005. Funds totaling $338.0 million were generated from operations,
regular investment maturities and the sale of investments with a carrying value of $119 million, and have been
converted to a liquid available position subsequent to February 26, 2005. The proceeds on the sale of these
investments approximated their carrying value.
The Company has a $70 million Letter of Credit Facility (the “Facility”) for operating requirements.
Approximately $48 million of the Facility has been utilized in order to satisfy a portion the Company’s liability
and funding obligation with respect to the NTP matter, as described in note 15 to the Consolidated Financial
Statements. During the third quarter of fiscal 2004 and pending the completion of the appeals process, the
Company posted, with the approval of the Court, a $48 million Standby Letter of Credit (“LC”) to guarantee the
monetary damages of the Court’s final order. The LC amount of $48 million excludes the fiscal 2005 and 2004
quarterly deposit obligations into the escrow bank account. The Company has pledged specific investments as
security for the Facility. Upon payment of the resolution amount and receipt of Court approval, the Company
intends to cancel this LC.
Research In Motion Limited •Incorporated Under the Laws of Ontario (In thousands of United States dollars, except per share data, and except as otherwise indicated)