Blackberry 2015 Annual Report Download - page 107

BlackBerry Limited
Notes to the Consolidated Financial Statements
In millions of United States dollars, except share and per share data, and except as otherwise indicated
32
The effects on net income of amounts reclassified from AOCI into income by component for the year ended February 28,
2015 were as follows:
Location of loss reclassified from AOCI into income Gains and Losses on Cash Flow Hedges
Gains and Losses on
Available-for-Sale
Securities Total
Selling, marketing and administration (9) — (9)
Research and development (4) — (4)
Cost of sales (2) — (2)
Recovery of income taxes 2 — 2
Total amount reclassified into income, net of tax $(13) $ — $ (13)
14. COMMITMENTS AND CONTINGENCIES
(a) Credit facility and letters of credit
The Company has $59 million in collateralized outstanding letters of credit in support of certain leasing arrangements
entered into in the ordinary course of business. See the discussion of restricted cash in Note 3.
(b) Lease commitments
The Company is committed to future minimum annual lease payments related to real estate operating leases as follows:
For the fiscal years ending:
2016 42
2017 37
2018 30
2019 26
2020 18
Thereafter 26
$ 179
For the year ended February 28, 2015, the Company incurred rental expense of $60 million (March 1, 2014 - $80 million;
March 2, 2013 - $91 million).
(c) Litigation
The Company is involved in litigation in the normal course of its business, both as a defendant and as a plaintiff. The
Company is subject to a variety of claims (including claims related to patent infringement, purported class actions and
other claims in the normal course of business) and may be subject to additional claims either directly or through
indemnities against claims that it provides to certain of its partners and customers. In particular, the industry in which the
Company competes has many participants that own, or claim to own, intellectual property, including participants that have
been issued patents and may have filed patent applications or may obtain additional patents and proprietary rights for
technologies similar to those used by the Company in its products. The Company has received, and may receive in the
future, assertions and claims from third parties that the Company’s products infringe on their patents or other intellectual
property rights. Litigation has been, and will likely continue to be, necessary to determine the scope, enforceability and
validity of third-party proprietary rights or to establish the Company’s proprietary rights. Regardless of whether claims
against the Company have merit, those claims could be time-consuming to evaluate and defend, result in costly litigation,
divert management’s attention and resources, subject the Company to significant liabilities and could have the other
effects that are described in greater detail under “Risk Factors” in the Company’s unaudited Annual Information Form for
the fiscal year ended February 28, 2015, which is included in the Company’s Annual Report on Form 40-F, including the
risk factors entitled “The Company is subject to general commercial litigation, class action and other litigation claims as
part of its operations, and it could suffer significant litigation expenses in defending these claims and could be subject to
significant damage awards or other remedies”, “The Company is subject to potential litigation claims arising from the
Company's disclosure practices”, and “The Company may infringe on the intellectual property rights of others”.