Dell 2007 Annual Report Download - page 78

Table of Contents
DELL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
ESPP on April 4, 2007, and subsequently discontinuing the ESPP as part of an overall assessment of its benefits strategy. Common stock
issued under the ESPP totaled 6 million shares in Fiscal 2007 and 5 million shares in Fiscal 2006. The weighted-average fair value of the
purchase rights under the ESPP during Fiscal 2007 and Fiscal 2006 was $3.89 and $6.30 per right, respectively.
NOTE 6 — FINANCIAL SERVICES
Dell Financial Services L.P.
Dell offers or arranges various financing options and services for its business and consumer customers in the U.S. through DFS, a wholly-
owned subsidiary of Dell. DFS was formerly a joint venture between Dell and CIT, but on December 31, 2007, Dell purchased CIT's
remaining 30% interest in DFS, making it a wholly-owned subsidiary. DFS is a full service financial services entity; key activities
include the origination, collection, and servicing of customer receivables related to the purchase of Dell products.
Dell utilizes DFS to facilitate financing for a significant number of customers who elect to finance products sold by Dell. New financing
originations, which represent the amounts of financing provided to customers for equipment and related software and services through
DFS, were $5.7 billion, $6.1 billion, and $6.5 billion during the fiscal year ended February 1, 2008, February 2, 2007, and February 3,
2006, respectively.
CIT continues to have the right to purchase a minimum percentage of DFS' customer receivables until January 29, 2010 (Fiscal 2010),
with the option to accelerate all or a portion of the Fiscal 2010 funding rights into Fiscal 2009. CIT's minimum funding right is
approximately 35% of the new customer receivables facilitated by DFS, but could be as much as 60% if CIT fully accelerates its Fiscal
2010 minimum funding right.
DFS services the receivables purchased by CIT. However, Dell's obligation related to the performance of the DFS originated receivables
purchased by CIT is limited to the cash funded credit reserves established at the time of funding.
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