7. | Restructuring charges |
The following table summarizes the amounts recorded related to restructuring activities, which are included in "Accrued expenses" and "Restructuring charges" in the accompanying consolidated balance sheets and statements of operations (in thousands):
Employee Costs |
Other Exit Costs |
Total | ||||||||||
Balance, January 1, 2009 |
$ | 400 | $ | 69 | $ | 469 | ||||||
Restructuring charges incurred |
5,080 | 647 | 5,727 | |||||||||
Less: cash payments |
(3,955 | ) | (644 | ) | (4,599 | ) | ||||||
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Balance, December 31, 2009 |
1,525 | 72 | 1,597 | |||||||||
Adjustment to accrued restructuring charges |
(45 | ) | (72 | ) | (117 | ) | ||||||
Less: cash payments |
(1,480 | ) | — | (1,480 | ) | |||||||
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Balance, December 31, 2010 |
— | — | — | |||||||||
Restructuring charges incurred |
340 | 8 | 348 | |||||||||
Less: cash payments |
— | (8 | ) | (8 | ) | |||||||
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Balance, December 31, 2011 |
$ | 340 | $ | — | $ | 340 | ||||||
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Q4 2011 Facility Closure
In December 2011, the Company's Board of Directors approved a plan of closure with respect to the Company's manufacturing facility in Manchester, England. The facility will be closed, and all employees will be terminated, on or about March 31, 2012. All affected employees were offered both stay-bonuses as well as severance benefits to be received upon termination of employment, should they remain with the Company through the closing date. The total one-time termination benefits total approximately $0.6 million and are being recorded over the remaining service period as employees are required to stay through their termination date to receive the benefits. During the year ended December 31, 2011, the Company recorded $0.3 million of costs related to these one-time termination benefits which is recorded within "Restructuring charges" in the accompanying consolidated statement of operations for the year ended December 31, 2011.
The following restructuring actions were complete as of December 31, 2010.
Q1 2009 Reduction in Force
In March 2009, the Company eliminated 207 positions across both manufacturing and administrative functions as part of a company wide effort to reduce costs and streamline operations. All affected employees were offered individually determined severance arrangements which included one- time termination benefits. As a result of this action, the Company recorded $1.3 million in restructuring charges during the year ended December 31, 2009.
Q2 2009 Reductions in Force and Facility Closure
During the three months ended June 30, 2009, the Company eliminated 38 positions in its administrative functions as part of a company wide effort to reduce costs and streamline operations. All affected employees were offered one time termination benefits, which included severance arrangements and, in certain instances, retention bonuses, if they remained with the Company through their proposed termination date. The total one-time termination benefits approximated $1.2 million and were recorded over the employees' remaining service period as the employees were required to stay through their termination date to receive benefits. During the year ended December 31, 2009, the Company recorded $1.2 million of costs related to these one-time termination benefits.
During the three months ended June 30, 2009, the Company eliminated 29 positions across its manufacturing function as part of a company wide effort to reduce costs. All affected employees were offered individually determined severance arrangements which included one time termination benefits. As a result of this action, the Company recorded $0.3 million in restructuring charges during the year ended December 31, 2009.
In May 2009, the Company's Board of Directors approved a plan of closure with respect to the Company's manufacturing facility in Huntsville, Alabama. The facility closed in November 2009. In connection with the plan, all of the 60 employees were terminated in November 2009. All affected employees were offered both retention bonuses as well as individually determined severance benefits to be received upon termination of employment as planned, should they remain with the Company through the planned termination date. The total one-time termination benefits approximated $1.2 million and were recorded over the employees' remaining service period as employees were required to stay through their termination date to receive the benefits. During the year ended December 31, 2009, the Company recorded $1.2 million of costs related to these one-time termination benefits. In addition, during the year ended December 31, 2009 the Company recorded $0.7 million related to other costs related to the closing of the facility and the consolidation of its operations with other Company facilities.
In connection with the closure of the Company's manufacturing facility in Huntsville, Alabama, the Company assessed the carrying value of the property and equipment at the facility. As a result, the carrying value of certain assets was written down to their respective fair values, less selling costs, of $0.7 million at December 31, 2009. The costs to sell the assets were not significant. The resulting charges combined with losses on those assets that were sold prior to December 31, 2009, totaled $0.4 million for the year ended December 31, 2009 and are included in loss on disposal of property and equipment in the accompanying consolidated statements of operations. The fair value estimate was determined using a quoted price in a brokered market and is considered a level 2 estimate within the Company's fair value hierarchy as discussed in Note 1 above.
Q3 2009 Reduction in Force
During September 2009, the Company eliminated 70 positions across both manufacturing and administrative functions as part of a company wide effort to reduce costs and streamline operations. All affected employees were offered individually determined severance arrangements which included one- time termination benefits. As a result of this action, the Company recorded $1.0 million in restructuring charges during the year ended December 31, 2009.