Acquisition Reserves

We recorded initial acquisition reserves of $47.4 million for restructuring charges and other direct costs associated with the acquisition of Manugistics in 2006. The restructuring charges were primarily related to facility closures, employee severance and termination benefits and other direct costs associated with the acquisition, including investment banker fees, change-in-control payments, and legal and accounting costs. Subsequent adjustments of $2.9 million were made to reduce the reserves in 2007 and 2008 based on our revised estimates of the restructuring costs to exit certain of the activities of Manugistics. The majority these adjustments were made by September 30, 2007 and included in the final purchase price allocation. All adjustments made subsequent to September 30, 2007, including a $1.4 million increase recorded in 2009 and a $1.5 million increase recorded in 2010, have been included in the consolidated statements of income under the caption “Restructuring charges.” Adjustments made in 2010 and 2009 resulted primarily from our revised estimate of sublease rentals and market adjustments on an unfavorable office facility lease in the United Kingdom. The unused portion of the acquisition reserves at December 31, 2011 includes $3.7 million of current liabilities under the caption “Accrued expenses and other liabilities” and $2.4 million of non-current liabilities under the caption “Accrued exit and disposal obligations.”

A summary of the charges and adjustments recorded against the reserves is as follows:



Description of charge	Initial Reserve		Adjustments to Reserves			Cash Charges			Impact of Changes in Exchange Rates			Balance December 31, 2010		Adjustments to Reserves		Cash Charges			Impact of Changes in Exchange Rates			Balance December 31, 2011
Acquisition reserves:
Office closures, lease termination and sublease costs	$	29,212	$	567		$	(19,361	)	$	(844	)	$	9,574	$	84	$	(3,476	)	$	(18	)	$	6,164
Employee severance and termination benefits	3,607		(840		)	(2,842		)	75			—		—		—			—			—
IT projects, contract termination penalties, capital lease buyouts and other costs to exits activities of Manugistics	1,450		222			(1,672		)	—			—		—		—			—			—
	34,269		(51		)	(23,875		)	(769		)	9,574		84		(3,476		)	(18		)	6,164
Direct costs:	13,125		6			(13,131		)	—			—		—		—			—			—
Total	$	47,394	$	(45	)	$	(37,006	)	$	(769	)	$	9,574	$	84	$	(3,476	)	$	(18	)	$	6,164

The balance in the reserve for office closures, lease termination and sublease costs is primarily related to office facility leases in Rockville, Maryland and the United Kingdom and will be reduced as payments are made over the related lease terms that extend through 2018.

In 2010 in connection with our acquisition of i2, we assumed an unfavorable lease of $1.2 million for the Dallas, Texas office which was recorded in the purchase price allocation of which $0.3 million remains in current liabilities under the caption of “Accrued expenses and other liabilities” and $0.4 million is included in non-current liabilities under the caption “Accrued exit and disposal obligations.”