VMware: IRS Form 8937 – Recapitalization



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VMware Inc.

Digital ID number: 94-3292913

Attachment to Form 8937

Lines 9, 10, 12

Classification and description

CUSIP number

Stock symbol

VMware Class A Common Shares

928563402

VMW

VMware Class B Common Shares

Line 14 Describe the organizational action and, if applicable, the date of the action or the date on which shareholder ownership is measured from the action.

November 1, 2021 at 5:01 p.m. EDT (the “Distribution Date”), pursuant to the terms and conditions of the Separation and Distribution Agreement dated April 14, 2021 between Dell Technologies Inc. (“Dell Technologies” and VMware , Inc. (“VMware”), Dell Technologies has distributed its entire interest in VMware (the “Distribution”), consisting of Class A common shares of VMware (“Class A Shares of VMware”) and ‘class B common shares of VMware (“VMware Class B Shares” and together with the class A shares of VMware, “VMware common shares”), prorated to shareholders of record at 5:00 p.m. EDT on October 29, 2021 ( the “Distribution Record Date”) of Dell Technologies Common Shares (each such shareholder a “new VMware shareholder”).

Immediately after the Distribution, and before receipt by New VMware Shareholders, each share of VMware Class B Shares is automatically converted into one fully paid, non-assessable share of VMware Class A Shares (the “Conversion”). As a result, each new VMware shareholder received 0.440626 of one VMware Class A share for each Dell Technologies common share held on the date of registration of the distribution (the “payout ratio”).1

Line 15 Describe the quantitative effect of the organizational action on the basis of the security held by a US taxpayer as an adjustment per share or as a percentage of the old basis.

The Conversion is intended to be treated as a reorganization under Section 368 (a) (1) (E) of the Internal Revenue Code of 1986, as amended (the “Code”). For US federal income tax purposes, each new VMware shareholder shall be deemed to be exchanging each VMware Class B share received in connection with the distribution for one VMware Class A share.

  • For US federal income tax purposes, in the distribution, each new VMware shareholder is considered to have received 0.040005 of a VMware Class A share and 0.400621 of a Class A share. B VMware (this amount including the payout ratio) for each share of Dell Technologies Common Shares.

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Pursuant to Section 358 (a) of the Code, the tax base of each share of VMware Class A Shares received by a New VMware Shareholder upon Conversion must be equal to the tax base of the Share of VMware Class B shares traded for this purpose.

New VMware shareholders who received VMware Class B shares in the distribution with respect to Dell Technologies common shares that were purchased at different times or at different prices must allocate the overall tax base to the shares of VMware Class A in a manner that replicates, to the greatest extent possible, the bases and holding periods allocated to the Class B VMware Shares (in the distribution) in respect of which the Class A VMware Shares were received . This allocation may result in the splitting of certain VMware class A shares and holding periods.

Please refer to Form 8937 filed by Dell Technologies regarding the distribution for more information regarding certain basic implications regarding VMware common shares received in connection with the distribution.

Line 16 Describe the calculation of the change in basis and the data that supports the calculation, such as market values ​​of securities and valuation dates.

In accordance with Article 354 (a) of the Code, because the Conversion is intended to be considered a tax-free reorganization under Article 368 (a) (1) (E) of the Code, and no consideration other than VMware Class A Shares has not been received, New VMware Shareholders should recognize no gain or loss on receipt of VMware Class A Shares upon Conversion.

Line 17 Indicate the applicable section (s) and sub-section (s) of the Internal Revenue Code on which the tax treatment is based.

Articles 354, 358 and 368 (a) (1) (E).

Line 18 Can a resulting loss be recognized?

No loss can be recognized by a new VMware shareholder upon conversion.

Line 19 Provide any other information needed to implement the adjustment, such as the tax year to report.

The tax effects of the Conversion must be declared by New VMware Shareholders in the tax year which includes November 1, 2021.

The information in this document does not constitute tax advice and is intended to provide a general summary only and is not intended to be a comprehensive analysis or description of all potential United States federal tax consequences of the transactions described in this document. .

In addition, the analysis presented above does not address the tax consequences which may vary depending on or depend on individual circumstances. You are urged to consult your own tax advisers regarding the particular tax consequences of such transactions for you, including the applicability and effect of all United States federal, state, local, and foreign taxes.

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