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ADOBE SYSTEMS INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share data)
(Continued)
60
NOTE 7. RESTRUCTURING AND OTHER CHARGES (Continued)
December 3, 1999, there was no restructuring liability remaining for restructuring programs prior to fiscal
1998.
The fourth quarter 1999 restructuring program was implemented to enhance the Company’s world-
wide customer support activity and to streamline the product distribution and warehouse operations in
North America. The program resulted in severance and related charges for 86 positions and included
charges for vacating leased facilities.
The 1999 restructuring program implemented in the second and third quarters was directly related to
the centralization of the Company’s worldwide sales and administrative organizations and the realignment
of the Company’s Printing Solutions business. The program included a reduction in force of 198 positions,
two of which were executive positions. In addition to severance and related charges, the restructuring
program included charges for vacating leased facilities.
The 1998 restructuring program was implemented to refocus the Company’s product development
efforts and to eliminate management redundancies in the organization. This program consisted of
severance and related charges for 364 positions, four of which were executive positions. Moreover, the
Company divested two business units, canceled certain contracts, and vacated leased facilities.
Fiscal 1999 restructuring programs
The restructuring program implemented in the fourth quarter of fiscal 1999 included a reduction in
force of 86 positions and the closure of the North American distribution warehouse as a result of the
decision to outsource the Company’s North American distribution operation and the majority of its
customer support services. The reduction in force primarily affected employees in Seattle, Washington and
Santa Clara, California. Total charges incurred as a result of the restructuring were $2.1 million, which
include severance and related charges associated with the reduction in force and charges related to
vacating leased facilities. As of December 3, 1999, $2.1 million remains accrued and is expected to be paid
by the end of the second quarter of fiscal 2000.
The following table depicts the activity for the 1999 fourth-quarter restructuring program through
December 3, 1999:
Accrued
Balance at
Total Cash Write- December 3
Charges Payments Downs 1999
Severance and related charges ........... $1,953 $— $ — $1,953
Lease termination costs ................ 103 — — 103
Impairment of leasehold improvements at
vacated facilities .................... 90 — (90) —
$2,146 $— $(90) $2,056