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Merger-Related and Restructuring Costs

6 Months Ended

Jun. 30, 2011

11. MERGER-RELATED AND RESTRUCTURING COSTS

Merger-related Costs

For the three and six months ended June 30, 2011, the Company incurred merger-related costs of $4 million in connection with the acquisition of NaviSite, all of which was paid during the second quarter.

Restructuring Costs

Beginning in the first quarter of 2009, the Company began a restructuring to improve operating efficiency, primarily related to headcount reductions and other exit costs, including the termination of a facility lease during the second quarter of 2010. Through June 30, 2011, the Company incurred costs of $144 million and made payments of $133 million related to this restructuring. Through December 31, 2010, the Company eliminated approximately 2,200 positions and eliminated approximately 160 additional positions during the first half of 2011. The Company expects to incur additional restructuring costs during the second half of 2011.

Information relating to this restructuring is as follows (in millions):

	Employee		Other
	Terminations		Exit Costs		Total
Remaining liability as of December 31, 2009	$	20	$	1	$	21
Costs incurred^(a)		33		19		52
Cash paid^(b)		(39)		(12)		(51)
Remaining liability as of December 31, 2010		14		8		22
Costs incurred^(c)		5		6		11
Cash paid^(d)		(12)		(10)		(22)
Remaining liability as of June 30, 2011^(e)	$	7	$	4	$	11

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Of the total costs incurred in 2010, $20 million and $31 million was incurred during the three and six months ended June 30, 2010, respectively.
Of the total cash paid in 2010, $14 million and $28 million was paid during the three and six months ended June 30, 2010, respectively.
Of the total costs incurred in 2011, $5 million was incurred during the three months ended June 30, 2011.
Of the total cash paid in 2011, $10 million was paid during the three months ended June 30, 2011.
Of the remaining liability as of June 30, 2011, $9 million is classified as a current liability, with the remaining amount classified as a noncurrent liability in the consolidated balance sheet. Amounts are expected to be paid through January 2014.