EMC 2006 Annual Report Download - page 71

Table of Contents
EMC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Prior Year Restructuring Programs
Prior to 2004, we had instituted several restructuring programs. The activity for these programs for the years ended December 31, 2006, 2005 and 2004
is presented below (tables in thousands):
2006
Category
Beginning
Balance
Adjustments
to the
Provision
During
2006
Utilization
During 2006
Ending
Balance
Workforce reduction $ 1,349 $ (506) $ (132) $ 711
Consolidation of excess facilities 65,291 (8,381) (16,825) 40,085
Other contractual obligations 2,378 278 (740) 1,916
Total $ 69,018 $ (8,609) $ (17,697) $ 42,712
2005
Category
Beginning
Balance
Adjustments
to the
Provision
During
2005
Utilization
During 2005
Ending
Balance
Workforce reduction $ 3,300 $ (651) $ (1,300) $ 1,349
Consolidation of excess facilities 91,281 2,082 (28,072) 65,291
Other contractual obligations 2,639 (244) (17) 2,378
Total $ 97,220 $ 1,187 $ (29,389) $ 69,018
2004
Category
Beginning
Balance
Adjustments
to the
Provision
During
2004
Utilization
During 2004
Ending
Balance
Workforce reduction $ 27,138 $ (11,728) $ (12,110) $ 3,300
Consolidation of excess facilities 106,296 23,687 (38,702) 91,281
Other contractual obligations 5,701 46 (3,108) 2,639
Total $ 139,135 $ 12,005 $ (53,920) $ 97,220
The reductions to the provisions in 2006 for excess facilities were a result of higher than anticipated sublease income from facilities associated with our
2001 restructuring program. The net additions to the provisions in 2005 and 2004 were the result of higher than anticipated costs associated with vacating
facilities associated with our 2001 restructuring program. These additions were partially offset by a reduction in the number of individuals originally
identified for termination.
The prior year restructuring programs impacted the Information storage and Content management and archiving segments.
All restructuring programs, with the exception of the 2006 program are substantially complete, although our ability to sublet facilities is subject to
appropriate market conditions. The remaining liability for the consolidation of excess facilities is expected to be paid out through 2015.
D. Convertible Debt
In November 2006, we issued our 2011 Notes and 2013 Notes for total gross proceeds of $3.45 billion. The Notes are senior unsecured obligations and
rank equally with all other existing and future senior unsecured debt. Holders may convert their Notes at their option on any day prior to the close of business
on the scheduled trading day immediately preceding (i) September 1, 2011, with respect to the 2011 Notes, and (ii) September 1, 2013, with respect to the
2013 Notes, in each case only under the following circumstances: (1) during the five business-day period after any five consecutive trading-day period (the
"measurement period") in which the price per Note of the applicable series for each day of that measurement period was less than 98% of the product of the
last reported sale price of our common stock and the conversion rate on each such day; (2) during any calendar quarter, if the last reported sale price of our
common stock for 20 or more trading days in a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar
quarter exceeds 130% of the applicable conversion price in effect on the last trading day of the immediately preceding calendar quarter; or (3) upon the
occurrence of certain events specified in the Notes. Additionally, the Notes will become convertible during the last three months prior to the respective
maturities of the 2011 Notes and the 2013 Notes.
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