Adaptec 2001 Annual Report Download - page 27

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27
The elements of the accrued restructuring costs related to the October 2001 restructuring plan
are as follows:
Workforce reduction includes the cost of severance and related benefits of 341 employees
affected by the restructuring. These terminations were spread across all business functions,
with approximately 64% occurring in Research and Development and the remainder occurring
in Sales, Marketing and Administrative and Production departments.
Facility lease and contract settlement costs include: (i) lease termination and other costs related
to the closure of corporate facilities as a result of this restructuring; and (ii) penalties incurred
due to our withdraw al from certain purchase contracts. A significant component of this charge
for excess facilities relates to a 10-year Santa Clara, CA building lease committed to in 2000.
The charge for this excess facility is recorded net of expected future sublease revenue. See
“ Critical A ccounting Policies and Significant Estimates” .
Certain leasehold improvements located at the closed facilities and computer equipment,
software licenses, and related software maintenance prepayments were written down to
estimated fair market value, net of disposal costs.
We expect to complete the restructuring activities contemplated in the October 2001
restructuring plan by the fourth quarter of 2002. Upon conclusion of these restructuring
activities, we expect to achieve additional annualized savings of approximately $67.6 million in
cost of revenues and operating expenses.
Interest and Other Income, N et ($ 000,000)
Net interest and other income declined in 2001 by $5.0 million, or 26%.
Excluding interest expense and the amortization of debt financing costs, interest and other
income for 2001 was $19.0 million as compared to $19.8 million in 2000. The amount for 2000
2001 Change 2000 Change 1999
Interest and other income, net $13.9 (26%) $18.9 139% $7.9
Percentage of net revenues 4% 3% 3%
Total Charge Noncash Cash Restructuring Liability at
(in thousands) October 18, 2001 Charges Payments December 31, 2001
Workforce reduction 12,435$ -$ (5,651)$ $ 6,784
Facility lease and contract settlement costs 150,610 - (400) 150,210
Write-down of prepaid software licenses 2,329 (2,329) -
Write-down of property and equipment, net 9,912 (9,912) - -
Total 175,286$ (12,241)$ (6,051)$ 156,994$