Memorex 2011 Annual Report Download - page 60

Download and view the complete annual report

Please find page 60 of the 2011 Memorex annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 114

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Accounts
Receivable*
(In millions)
Reserves and Allowances
Balance, as of December 31, 2008 ............................................... $36.6
Additions ................................................................ 40.1
Write-offs, net of recoveries .................................................. (48.1)
Balance, as of December 31, 2009 ............................................... $28.6
Additions ................................................................ 9.0
Write-offs, net of recoveries .................................................. (17.0)
Balance, as of December 31, 2010 ............................................... $20.6
Additions ................................................................ 10.5
Write-offs, net of recoveries .................................................. (12.7)
Balance, as of December 31, 2011 ............................................... $18.4
* Accounts receivable reserves and allowances include estimated amounts for customer returns, term discounts and the
inability of certain customers to make the required payment.
Note 6 — Intangible Assets and Goodwill
Intangible Assets
Intangible assets consist of the following:
Trade
Names Software
Customer
Relationships Other Total
(In millions)
December 31, 2011
Cost ................................... $347.1 $ 57.9 $ 61.5 $13.9 $ 480.4
Accumulated amortization ................... (57.5) (51.1) (45.5) (4.6) (158.7)
Net.................................. $289.6 $ 6.8 $ 16.0 $ 9.3 $ 321.7
December 31, 2010
Cost ................................... $332.4 $ 54.2 $ 58.8 $ 8.3 $ 453.7
Accumulated amortization ................... (44.9) (49.1) (36.2) (3.1) (133.3)
Net.................................. $287.5 $ 5.1 $ 22.6 $ 5.2 $ 320.4
On December 20, 2011, we acquired intellectual property and other assets, including key data deduplication technology,
from Nine Technology, LLC, (Nine Technology). This data deduplication software engine eliminates redundant data, enabling
shorter backup windows, quicker recovery, lower infrastructure costs and more robust and reliable data protection. The
purchase price consisted of a cash payment of $2.0 million, $1.0 million in future contingent payments and $0.5 million in
stock. We recorded the payment as an other intangible asset and are amortizing the intangible asset over a five year period.
In 2010 we entered into an amendment to our license agreement with ProStor. Under the terms of the agreement, we paid
$5.0 million and will have a semi-exclusive license to manufacture, market and sell RDX removable hard disk systems through
2020. We recorded the payment as an other intangible asset and are amortizing the payment over a five year period. The
acquisition of certain ProStor assets on August 29, 2011 excluded the portion of the business to which this license relates.
57