Einstein Bros 2004 Annual Report Download - page 52

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http://www.sec.gov/Archives/edgar/data/949373/000104746905006202/a2153240z10-k.htm[9/11/2014 10:13:29 AM]
2002 Restructuring
During the quarter ended October 1, 2002, we implemented a plan to shut down our dough manufacturing facilities on the East Coast. During
the quarter ended December 31, 2002, we implemented a plan to terminate the lease obligation for the Eatontown location. We vacated the
Eatontown location in the last week of 2002. When initiated, the restructuring plans were expected to take approximately one year to complete,
subject to our ability to sublease the Eatontown facility. We ultimately recorded a $4,800 charge associated with the restructuring plans in 2002.
Approximately $2,200 of this charge represented a write-off of equipment and leasehold improvements that were either abandoned or deemed
unusable by us. In the fourth quarter of fiscal 2003, we became aware that the Eatontown facility was in the process of being sold and that the
landlord had engaged a valuation expert to determine the total cost associated with our vacating the facility. Based upon the results of this study,
we adjusted our initial charge to our estimate of the ultimate liability on the Eatontown facility. During April 2004, we reached an agreement with
the landlord of the Eatontown facility to settle outstanding litigation. Previously recorded integration and reorganization estimates associated with
closing this facility were adjusted to reflect a reduction of the prior year's accrued cost of $700,000.
The following table presents the activity and balances related to the 2002 restructuring accrual:
Facility
Consolidation
Costs
Severance Costs
Contract
Termination and
Other Costs
Total
Initial accrual $ 1,447 $ 787 $ 300 $ 2,534
Application of costs against the accrual — (662) (168) (830)
Balance at December 31, 2002 $ 1,447 $ 125 $ 132 $ 1,704
Application of costs against the accrual (160) (90) (68) (318)
Adjustments to the accrual 2,413 (35) (33) 2,345
Balance at December 30, 2003 $ 3,700 $ — $ 31 $ 3,731
Application of costs against the accrual (3,000) — — (3,000)
Adjustments to the accrual (700) — (31) (731)
Balance at December 28, 2004 $ — $ — $ — $ —
19. LOSS (GAIN) ON SALE, DISPOSAL OR ABANDONMENT OF ASSETS
During fiscal 2004, we recorded a loss on disposal or abandonment of assets of approximately $120 due to the disposal of menu boards as a
result of our new menu offerings and approximately $1,500 due to the abandonment of leasehold improvements related to closed restaurants and
our administrative facilities located in New Jersey. The loss on disposal or abandonment of assets was offset by a gain of approximately $90 on the
sale of the assets of Willoughby's as further described below.
63
20. SALE OF WILLOUGHBY'S COFFEE AND TEA
Effective October 6, 2004, we executed an Asset Purchase Agreement and sold the assets of Willoughby's to the original founders. The
Willoughby's business consisted of a coffee roasting plant, three retail locations and an office space.
Components of the asset sale included, but were not limited to:
•The "Willoughby's Coffee & Tea" trade name, trademark and logo,
•The "Serious Coffee" trademark,
•The willoughbyscoffee.com domain name and existing website,
•All property and equipment of Willoughby's, and