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58 EA 2002 AR
The following summarizes the activity under the Company’s Class B stock option plan during the fiscal
years ended March 31, 2002 and 2001:
OPTIONS OUTSTANDING
WEIGHTED-AVERAGE
SHARES EXERCISE PRICE
Balance at March 31, 2000 — $ —
Granted 5,785,792 9.62
Canceled (429,310) 9.28
Exercised (250,000) 9.00
Balance at March 31, 2001 (21,990 shares were exercisable
at a weighted average price of $9.57) 5,106,482 9.68
Granted 977,983 12.00
Canceled (1,923,220) 9.99
Exercised (80) 9.00
Balance at March 31, 2002 4,161,165 $10.09
Options available for grant at March 31, 2002 2,363,755
(11) PROPERTY AND EQUIPMENT
Property and equipment at March 31, 2002 and 2001 consisted of:
(In thousands) 2002 2001
Computer equipment and software $319,893 $310,147
Buildings 97,939 94,784
Land 44,911 44,721
Office equipment, furniture and fixtures 31,915 32,569
Leasehold improvements 15,463 13,483
Warehouse equipment and other 5,396 4,319
515,517 500,023
Less accumulated depreciation and amortization (206,690) (162,824)
$308,827 $337,199
Depreciation and amortization expenses associated with property and equipment amounted to $67,619,000,
$50,345,000 and $34,736,000 for the fiscal years ended March 31, 2002, 2001 and 2000, respectively.
(12) ACCRUED AND OTHER LIABILITIES
Accrued and other liabilities at March 31, 2002 and 2001 consisted of:
(In thousands) 2002 2001
Accrued income taxes $94,444 $42,371
Accrued compensation and benefits 87,985 75,603
Accrued expenses 87,104 73,997
Accrued royalties 77,590 55,997
Deferred revenue 13,286 16,967
Warranty reserve 4,010 2,030
$364,419 $266,965
(13) BUSINESS COMBINATIONS
(a) Pogo Corporation
On February 28, 2001, EA.com acquired Pogo Corporation (now referred to as “Pogo”) for $43,333,000,
including an initial investment of $42,000,000 and the redemption of Pogo preferred stock of $1,333,000.
Pogo operates an ad-supported games service that reaches a broad consumer market. Pogo’s internet-based
family games focus on easy-to-play card, board and puzzle games.
The acquisition has been accounted for under the purchase method.The results of operations of Pogo
and the estimated fair market values of the acquired assets and liabilities have been included in the consoli-
dated financial statements from the date of acquisition.The adjusted allocation of the excess purchase price
over the net tangible assets acquired was $40,516,000, of which, based on management’s estimates pre-
pared in conjunction with a third party valuation consultant, $2,719,000 was allocated to purchased