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Table of Contents
EARTHLINK, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Facility exit and restructuring liabilities due within one year of the balance sheet date are classified as other accrued liabilities and facility
exit and restructuring liabilities due after one year are classified as other long-
term liabilities in the Consolidated Balance Sheets. Of the unpaid
balance as of December 31, 2009 and 2010, approximately $5.1 million and $4.7 million, respectively, was classified as other accrued liabilities
and approximately $12.3 million and $8.9 million, respectively, was classified as other long-term liabilities.
Legacy Restructuring Plans
During the years ended December 31, 2003, 2004 and 2005, EarthLink executed a series of plans to restructure and streamline its contact
center operations and outsource certain internal functions (collectively referred to as "Legacy Plans"). The Legacy Plans included facility exit
costs, personnel-
related costs and asset disposals. EarthLink periodically evaluates and adjusts its estimates for facility exit and restructuring
costs based on currently-available information. Such adjustments are included as restructuring and acquisition-
related costs in the Consolidated
Statements of Operations. During the years ended December 31, 2008 and 2009, EarthLink recorded reductions of $0.3 million and $0.1 million,
respectively, to facility exit and restructuring costs as a result of changes in estimates. During the year ended December 31 2010, EarthLink
recorded $0.3 million of facility exit and restructuring costs related to Legacy Plans as a result of changes in estimates. As of December 31,
2010, all costs related to Legacy Plans had been paid or otherwise settled.
Acquisition
-Related Costs
Acquisition-
related costs consist of external costs directly related to EarthLink's acquisitions, such as advisory, legal, accounting, valuation
and other professional fees. Acquisition-
related costs also include employee severance and benefit costs and costs resulting from cash paid to
settle stock-based awards attributable to postcombination service in connection with the ITC^DeltaCom acquisition. Acquisition-
related costs
consisted of the following during the year ended December 31, 2010:
5. Discontinued Operations
In November 2007, management concluded that its municipal wireless broadband operations were no longer consistent with the Company's
strategic direction and the Company's Board of Directors authorized management to pursue the divestiture of the Company's municipal wireless
broadband assets. As a result of that decision, the Company classified the municipal wireless broadband assets as held for sale on the
Consolidated Balance Sheets and presented the municipal wireless broadband results of operations as discontinued operations for all periods
presented. The results of operations for municipal wireless broadband were previously included in the Consumer Services segment. As of
December 31, 2008, the Company had completed the divestiture of its municipal wireless broadband assets.
102
Year Ended
December 31,
2010
(in thousands)
Transaction related costs
$
10,164
Costs to settle postcombination stock awards
5,742
Severance and retention costs
5,047
Total acquisition
-
related costs
$
20,953