EMC 2011 Annual Report Download - page 92

Table of Contents
EMC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
Twelve Months Ended December 31, 2010
Category
Beginning
Balance
2010
Charges Utilization
Ending
Balance
Workforce reductions $ 87,238 $ 45,055 $ (78,347) $ 53,946
Consolidation of excess facilities and other contractual obligations 18,522 31,607 (22,311) 27,818
Total $ 105,760 $ 76,662 $ (100,658) $ 81,764
Twelve Months Ended December 31, 2009
Category
Beginning
Balance
2009
Charges Utilization
Ending
Balance
Workforce reductions $ 200,599 $ 55,090 $ (168,451) $ 87,238
Abandoned and impaired assets — 6,203 (6,203) —
Consolidation of excess facilities and other contractual obligations 24,105 27,131 (32,714) 18,522
Total $ 224,704 $ 88,424 $ (207,368) $ 105,760
R. Related Party Transactions
In 2011, 2010 and 2009, we leased certain real estate from a company owned by a member of our Board of Directors and such Director's siblings, for
which payments aggregated approximately $4.8 million in each year. Such lease was initially assumed by us as a result of our acquisition of Data General in
1999 and renewed in 2003 for a ten-year term. We are currently in the process of vacating the facility and do not intend to renew the lease upon its expiration.
In accordance with its written policy and procedures relating to related person transactions, EMC's Audit Committee has approved the above
transaction.
EMC is a large global organization which engages in thousands of purchase, sales and other transactions annually. We enter into purchase and sales
transactions with other publicly-traded and privately-held companies, universities, hospitals and not-for-profit organizations with which members of our
Board of Directors or executive officers are affiliated. We enter into these arrangements in the ordinary course of our business.
From time to time, we make strategic investments in publicly-traded and privately-held companies that develop software, hardware and other
technologies or provide services supporting our technologies. We may purchase from or make sales to these organizations.
We believe that the terms of each of these arrangements described above were fair and not less favorable to us than could have been obtained from
unaffiliated parties.
S. Segment Information
We manage our business in two broad categories: EMC Information Infrastructure and VMware Virtual Infrastructure. EMC Information Infrastructure
operates in three segments: Information Storage, Information Intelligence Group and RSA Information Security, while VMware Virtual Infrastructure
operates in a single segment. Our management measures are designed to assess performance of these operating segments excluding certain items. As a result,
the corporate reconciling items are used to capture the items excluded from the segment operating performance measures, including stock-based
compensation expense and acquisition-related intangible asset amortization expense. Additionally, in certain instances, restructuring and acquisition-related
charges, transition costs and infrequently occurring charges, gains or losses are also excluded from the measures used by management in assessing segment
performance. The VMware Virtual Infrastructure amounts represent the revenues and expenses of VMware as reflected within EMC's consolidated financial
statements. Research and development expenses, SG&A, and other income associated with the EMC Information Infrastructure business are not allocated to
the segments within the EMC Information Infrastructure business, as they are managed centrally at the business unit level. For the three segments within the
EMC Information Infrastructure business, gross profit is the segment operating performance measure.
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