Seagate 2009 Annual Report Download - page 90

Table of Contents
SEAGATE TECHNOLOGY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
described below. All restructuring charges are reported in Restructuring and other, net on the Consolidated Statement of Operations, unless
otherwise noted.
2010 Plan. During fiscal year 2010, the Company recorded $4 million related to employee termination costs for a new plan as a result of
the Company's ongoing focus on cost efficiencies in all areas of its business. The Company made cash payments of $2 million relating to this
plan during fiscal year 2010. The 2010 Plan is expected to be completed by the end of the Company's first quarter of fiscal year 2011.
AMK Plan. In August 2009, the Company announced that it will close its AMK facility in Singapore. The Company expects to complete
the closure during fiscal year 2011. The hard drive manufacturing operations will be relocated to other existing Seagate facilities and the
Company's Asia International Headquarters (IHQ) will remain in Singapore. This closure and relocation is part of the Company's ongoing focus
on cost efficiencies in all areas of its business and is intended to facilitate leveraging manufacturing investments across fewer sites. The
Company does not expect the closure to meaningfully change production capacity. The Company currently estimates total restructuring charges
of approximately $60 million, all in cash, including approximately $40 million for post-employment benefits, approximately $10 million for the
relocation of manufacturing equipment, and approximately $10 million for other plant closure and relocation costs. During fiscal year 2010, the
Company accrued total restructuring charges of $38 million related to post-employment benefits and $1 million related to other exit costs. The
Company made cash payments of $3 million relating to this plan during fiscal year 2010.
January and May 2009 Plans. From inception of the Company's restructuring plans announced in January and May of 2009 through
July 2, 2010, the Company has recorded restructuring charges of approximately $167 million primarily related to post employment benefits. The
Company made cash payments of $60 million relating to these plans during fiscal year 2010. The January and May 2009 Plans were
substantially complete by the end of the Company's third quarter of fiscal year 2010.
Site Closures. The Company announced the closure of its research facility in Pittsburgh, Pennsylvania and its media manufacturing
facility in Milpitas, California in September 2008 and July 2008, respectively. Operations at these facilities had ceased as of the end of the
Company's fiscal year 2009. From the inception of these plans through July 2, 2010, the Company has recorded restructuring related charges of
approximately $117 million, including $18 million of restructuring costs recorded in fiscal year 2010 when the estimated lease obligations were
revised based on current market conditions. These closures are currently expected to result in total charges of approximately $140 million. The
Company made cash payments of $9 million relating to these plans during fiscal year 2010. The remaining balance of $18 million as of July 2,
2010 is associated with facility lease obligations that are expected to continue through the end of fiscal year 2017.
Maxtor and Other. Through July 2, 2010, the Company recorded certain exit costs aggregating $269 million related to its acquisition of
Maxtor, including $4 million in fiscal year 2010 relating to adjustments to previously recorded restructuring charges to reflect its revised sub-
lease expectations for its Maxtor facilities closure. During fiscal year 2010, the Company made cash payments on these restructuring plans of
$9 million. The remaining balance of $24 million, as of July 2, 2010, is primarily associated with the exit of certain facilities. Payment of these
exit costs are expected to continue through the end of fiscal year 2016.
During fiscal year 2009, the Company recorded restructuring and other charges of $210 million, comprised mainly of charges related to the
May 2009 Plan and January 2009 Plan, both intended to realign its cost structure with the macroeconomic business environment.
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