Dell 2010 Annual Report Download - page 22

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Table of Contents
• The expiration of tax holidays or favorable tax rate structures, or unfavorable outcomes in tax audits and other tax compliance
matters, could result in an increase in our current tax expense or our effective income tax rate in the future.
Portions of our operations are subject to a reduced tax rate or are free of tax under various tax holidays that expire in whole or
in part from time to time. Many of these holidays may be extended when certain conditions are met, or terminated if certain
conditions are not met. If the tax holidays are not extended, or if we fail to satisfy the conditions of the reduced tax rate, then
our effective tax rate would increase in the future. Our effective tax rate could also increase if our geographic sales mix
changes. We are under audit in various tax jurisdictions. An unfavorable outcome in certain of these matters could result in a
substantial increase to our tax expense. In addition, changes in tax laws (including U.S. taxes on foreign operations) could
adversely affect our operations and profitability.
• Our success depends on our ability to attract, retain, and motivate our key employees.
We rely on key personnel, including our CEO and executive leadership team, to support anticipated continued rapid
international growth and increasingly complex product and services offerings. We may not be able to attract, retain, and
motivate the key professional, technical, marketing, and staff resources we need.
• We face risks relating to any inability to maintain strong internal controls.
If management is not successful in maintaining a strong internal control environment, investors could lose confidence in our
reported financial information. This could lead to a decline in our stock price, limit our ability to access the capital markets in
the future, and require us to incur additional costs to improve our internal control systems and procedures.
• Current environmental and safety laws, or laws enacted in the future, may harm our business.
Our operations are subject to environmental and safety regulation in all of the areas in which we conduct business. Our product
design and procurement operations must comply with new and future requirements relating to climate change laws and
regulations, materials composition, sourcing, energy efficiency and collection, recycling, treatment, transportation and disposal
of our electronics products, including restrictions on mercury, lead, cadmium, lithium metal, lithium ion and other substances. If
we fail to comply with applicable rules and regulations regarding the transportation, source, use and sale of such regulated
substances, we could be subject to liability. The costs and timing of costs under environmental and safety laws are difficult to
predict, but could have an unfavorable impact on our business.
• Armed hostilities, terrorism, natural disasters, or public health issues could harm our business.
Armed hostilities, terrorism, natural disasters, or public health issues, whether in the U.S. or abroad, could cause damage or
disruption to us, our suppliers or customers, or could create political or economic instability, any of which could harm our
business. These events could cause a decrease in demand for our products, could make it difficult or impossible for us to deliver
products or for our suppliers to deliver components, and could create delays and inefficiencies in our supply chain.
ITEM 1B — UNRESOLVED STAFF COMMENTS
None.
ITEM 2 — PROPERTIES
At January 28, 2011, we owned or leased a total of approximately 18.1 million square feet of office, manufacturing, and warehouse space
worldwide, approximately 8.3 million square feet of which is located in the U.S. We owned approximately 62% of this space and leased
the remaining 38%. Included in these amounts are approximately 2.1 million square feet that are either vacant or sublet.
Our principal executive offices, including global headquarters, are located at One Dell Way, Round Rock, Texas. Our business centers,
which include facilities that contain operations for sales, technical support, administrative,
18