3Ware 2001 Annual Report Download - page 35

N O T E S T O C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S
estimated after-tax cash flows. Projected operating expenses include cost of goods sold, marketing and selling expenses,
general and administrative expenses and re s e a r ch and development, including estimated costs to maintain the pro d u c t s
once they have been introduced into the market and are generating revenue. The remaining identified intangibles,
including goodwill, will be amortized on a straight-line basis over lives ranging from one to six years.
The following unaudited pro forma summary presents the consolidated results of operations of the Company, exclud-
ing acquired IPR&D charges above, as if the acquisitions had occurred at the beginning of each period presented and
does not purport to be indicative of what would have occurred had the acquisition been made as of that date or of the
results that may occur in the future:
Year Ended March 31,
(in thousands, except per share data) 2000 2001
Net sales . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 227,315 $ 508,092
Net loss . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (843,530) $ (849,414)
Basic loss per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (3.91) $ (3.18)
F I S C A L 1 9 9 9 A C Q U I S I T I O N S
In March 1999, the Company acquired all of the outstanding common stock and common stock equivalents of
Cimaron in exchange for approximately 24 million shares of the Company’s common stock. Cimaron designs and
develops high-bandwidth silicon solutions for communication equipment manufacturers. The acquisition was account-
ed for using the pooling-of-interests method of accounting. Prior to the combination, Cimaron had a fiscal year end
of December 31. In recording the business combination, Cimaron’s results of operations for the fiscal year ended
December 31, 1998 were combined with AMCC’s for the fiscal year ended March 31, 1999. Cimaron’s net sales and
net loss for the three-month period ended March 31, 1999 were $110,000 and $(1,341,000), respectively. Cimaron’s
results of operations and cash flows for the three-month period ended March 31, 1999 have been added directly to the
retained earnings and cash flows of AMCC and excluded from reported fiscal 1999 results of operations.
In April 1998, the Company acquired Ten Mountains Design, which designs and develops high-bandwidth analog
devices for communications equipment suppliers and optical module manufacturers. The financial statements include
the results of operations for Ten Mountains Design from the date of acquisition.
Net goodwill and other acquisition-related intangibles at fiscal years ending March 31 were as follows:
(in thousands) Life in Years 2000 2001
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1–6 $— $3,708,191
Developed core technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 — 268,836
Other intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3–5 — 31,413
$— $4,008,440
Other intangibles include items such as trademarks and workforce-in-place. The total balances presented above are net
of accumulated amortization of $334.1 million at March 31, 2001.
During 2001, the Company re c o r ded acquisition-related purchase consideration of $438.8 million as deferred stock-based
compensation. This amount re p r esents the portion of the purchase consideration related to shares issued contingent
on continued employment of certain employee stockholders and the intrinsic value of stock options assumed that are
earned as future services are provided by the employees. The compensation is being re c o g n i zed over the related ve s t i n g
period. The related expenses are identified with re s e a rch and development, cost of re venues and selling, general and
a d m i n i s t r a t i ve depending on the function of the individual employee providing services. Howe ve r, for presentation pur-
poses, the amounts have been footnoted on the face of the income statement and excluded from the functional line items.
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