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Notes To Consolidated Financial Statements
Note 10: Restructuring Plans
Fiscal 2008 Restructuring Plans
Second Quarter of Fiscal 2008 Restructuring Plan. In the second quarter ended June 28, 2008, the
Company initiated restructuring actions in an effort to better align its cost structure with its anticipated revenue
stream and to improve the Company’s results of operations and cash flows (“Second Quarter of Fiscal 2008
Restructuring Plan”). The cost of $4.1 million was for severance and benefits related to the involuntary
termination of approximately 131 employees in all functions, primarily in the U.S. and Israel.
The following table sets forth the activity in the accrued restructuring balances related to the Second Quarter
of Fiscal 2008 Restructuring Plan (in millions):
Severance and
Benefits
Contract
Termination
Fees and Other
Charges Total
Restructuring provision .................................. $ 4.1 $ — $ 4.1
Cash paid ............................................. (3.1) — (3.1)
Accrual balance at December 28, 2008 ...................... $ 1.0 $ — $ 1.0
The remaining restructuring accrual balance is reflected in Other Current Accrued Liabilities in the
Consolidated Balance Sheets and is expected to be utilized in fiscal year 2009.
Fourth Quarter of Fiscal 2008 Restructuring Plan and Other. In the fourth quarter ended December 28,
2008, the Company initiated additional restructuring actions in an effort to better align its cost structure with
business operation levels (“Fourth Quarter of Fiscal 2008 Restructuring Plan and Other”). Of the total costs
accrued of $31.4 million, $10.4 million was related to severance and benefits for the involuntary termination of
approximately 428 employees in all functions, primarily in the U.S., Israel and Spain. Contract Termination Fees
and Other Charges of $21.0 million included restructuring charges for marketing contract termination costs,
technology license impairments, and fixed asset impairments related to outsourcing certain manufacturing
activities. In addition to the restructuring charge, contract termination fees and other charges include an accrual
for unrelated litigation settlements.
The following table sets forth the activity in the accrued restructuring balances related to Fourth Quarter of
Fiscal 2008 Restructuring Plan and Other (in millions):
Severance and
Benefits
Contract
Termination
Fees and Other
Charges Total
Restructuring and other provisions ......................... $10.4 $21.0 $31.4
Cash paid ............................................. (4.1) (2.4) (6.5)
Non-cash utilization ..................................... — (4.6) (4.6)
Accrual balance at December 28, 2008 ...................... $ 6.3 $14.0 $20.3
The Company anticipates that the remaining restructuring accrual balance of $20.3 million will be
substantially paid out or utilized in fiscal year 2009. The remaining restructuring accrual balance is reflected in
Other Current Accrued Liabilities in the Consolidated Balance Sheets.
F-32