DIRECTV 2002 Annual Report Download - page 105

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HUGHES ELECTRONICS CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS — (continued)
stock with exercise prices ranging from $14.64 per share to $63.25 per share. The options vest ratably
over three to four years and have a remaining life ranging from four to ten years. At December 31,
2002, 2,749,027 options were exercisable at a weighted average exercise price of $36.37 per share.
The PanAmSat options have been considered in the following pro forma analysis.
The following table presents pro forma information as if Hughes recorded compensation cost using
the fair value of issued options on their grant date, as required by SFAS No. 123, “Accounting for Stock
Based Compensation”:
2002 2001 2000
(Dollars in Millions)
Earnings (loss) used for computation of available separate
consolidated net income (loss), as reported ..................... $ (940.7) $(714.7) $ 732.9
Assumed stock compensation costs ............................. (171.7) (231.8) (147.6)
Pro forma earnings (loss) used for computation of available separate
consolidated net income (loss) ................................ $(1,112.4) $(946.5) $ 585.3
The pro forma amounts for compensation cost are not indicative of the effects on operating results
for future periods.
The following table presents the estimated weighted-average fair value for options granted under
the Plan using the Black-Scholes valuation model and the assumptions used in the calculations:
2002 2001 2000
Estimatedfairvalueperoptiongranted .............................. $ 9.19 $13.66 $20.39
Average exercise price per option granted ............................ 15.71 23.34 37.06
Expected stock volatility ........................................... 51.6% 51.3% 42.1%
Risk-free interest rate ............................................. 4.7% 5.1% 6.5%
Expected option life (in years) ...................................... 7.0 7.0 6.9
Note 14: Other Income and Expenses
2002 2001 2000
(Dollars in Millions)
Equity losses from unconsolidated affiliates ......................... $ (70.1) $ (61.3) $(164.2)
EchoStar Merger termination payment ............................. 600.0 — —
Net gain (loss) on discontinuation of businesses ..................... 41.1 32.0 (128.4)
Net loss on write-down of investments to fair value ................... (180.6) (239.0) —
Net gain from sale of investments ................................. 84.1 130.6 —
Other ........................................................ (49.0) 45.0 —
TotalOther,net ............................................ $425.5 $ (92.7) $(292.6)
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