Memorex 2010 Annual Report Download - page 25

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During 2010 we recorded severance and related expenses of $3.4 million and pension curtailment charge of
$0.3 million related to this program. In the future, we expect to incur severance and related expenses of approximately
$11 million, charges associated with certain benefit plans of approximately $11 million, lease termination expenses of
approximately $5 million, and other charges of approximately $5 million related to this program. The restructuring related
to this program is expected to be substantially complete during 2012.
2008 Corporate Redesign Restructuring Program
During 2010, we recorded $6.4 million of severance and related expenses and $1.7 million of lease termination costs
related to our 2008 corporate redesign restructuring program. This program was initiated during the fourth quarter of 2008
and aligned our cost structure by reducing SG&A expenses. We reduced costs by rationalizing key accounts and products
and by simplifying our corporate structure globally. The program was substantially complete as of December 31, 2010.
During 2009, we recorded $11.2 million of severance and related expenses and $0.1 million of lease termination
costs related to this program.
During 2008, we recorded $4.9 million of severance and related expenses and $0.5 million of lease termination costs
related to this program.
Prior Programs Substantially Complete
During 2009, we recorded $0.9 million of lease termination costs related to our 2008 cost reduction restructuring
program. This program began in the third quarter of 2008 when our Board of Directors approved the Camarillo, California
restructuring plan as further implementation of our manufacturing strategy. In order to partially mitigate projected declines in
tape gross profits in future years, we ended manufacturing at our Camarillo plant and exited the facility during 2008. The
2008 cost reduction restructuring program also included our decision to consolidate the Cerritos, California business
operations into Oakdale, Minnesota. During 2009, we consolidated the previous Cerritos activities into a single headquarters
location in order to achieve better focus, gain efficiencies across brands and channels and reduce cost. We recorded
$0.3 million of income through the reversal of lease termination accruals related to previously announced programs.
During 2008, we recorded $5.2 million of severance and related expenses and lease termination costs of $0.2 million,
related to our 2008 cost reduction restructuring program. We recorded $5.3 million for severance and related expenses
under our TDK Recording Media and 2007 cost reduction restructuring programs, which began in 2007. We also recorded
$1.8 million of lease termination costs related to these programs. During 2008 we recorded $0.3 million of severance and
related expenses and $2.3 million of lease termination costs related to other programs which are substantially complete.
Other
We recorded pension settlement and curtailment losses of $2.8 million, $11.7 million and $5.7 million in 2010, 2009
and 2008, respectively, within restructuring and other expense in the Consolidated Statements of Operations, mainly as a
result of the downsizing associated with our restructuring activities. See Note 9 to the Consolidated Financial Statements
for further information regarding pension settlements and curtailments.
We incurred net asset impairment charges of $31.2 million (as noted above), $2.7 million and $5.0 million in 2010,
2009 and 2008, respectively, related mainly to the abandonment of certain manufacturing and R&D assets as a result of
our restructuring activities.
During 2010, other expenses of $2.4 million included costs associated with the announced retirement of our former
Vice Chairman and Chief Executive Officer, Mr. Frank Russomanno, including a severance related charge of $1.4 million
and a charge of $0.8 million related to the accelerated vesting of his unvested options and restricted stock.
We recorded a $2.3 million TDK post-closing purchase price adjustment in 2008 associated with the finalization of
certain acquisition-related working capital amounts as negotiated with TDK. See Note 4 to the Consolidated Financial
Statements for further information.
See Note 7 to the Consolidated Financial Statements for further information regarding our various restructuring
programs and other expenses.
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