Plantronics 2013 Annual Report Download - page 72

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62
During the fourth quarter of fiscal year 2011, the Company finalized a long-term product development strategy and in doing so,
evaluated the extent to which acquired technology would be used in future products. As part of this analysis, the Company elected
to abandon certain of its acquired technology and therefore, recorded $1.4 million in accelerated amortization expense in the fourth
quarter of fiscal year 2011 to reflect the revised estimate of the asset's useful life. This accelerated amortization expense was
recorded in cost of revenues in the Company's consolidated statements of operations.
8. RESTRUCTURING AND OTHER RELATED CHARGES
The Company accounts for restructuring costs in accordance with the Exit or Disposal Cost Obligations and Compensation -
Nonretirement Postemployment Benefits Topics of the FASB ASC. The Company initiated a restructuring plan during the third
quarter of fiscal year 2013. Under the plan, the Company eliminated certain positions in the U.S., Mexico, China, and Europe,
and transitioned some of these positions to lower cost locations. The Company also plans to vacate a portion of a leased facility
at its corporate headquarters in the first quarter of fiscal year 2014. The Company expects to incur total pre-tax charges of
approximately $3.1 million in connection with this plan.
The pre-tax charges incurred during fiscal year 2013 included $1.9 million for severance and related benefits and an immaterial
amount of accelerated amortization expense on leasehold improvement assets with no alternative future use. The Company expects
to record $1.0 million for lease termination costs and the remaining accelerated depreciation on leasehold improvements when it
exits the facility in the first quarter of fiscal year 2014. The Company anticipates that the plan will be substantially complete by
the end of the first quarter of fiscal year 2014.
9. COMMITMENTS AND CONTINGENCIES
Minimum Future Rental Payments
Minimum future rental payments under non-cancelable operating leases having remaining terms in excess of one year as of
March 31, 2013 are as follows:
Fiscal Year Ending March 31, (in thousands)
2014 $ 4,686
2015 1,913
2016 1,334
2017 727
2018 650
Thereafter 1,568
Total minimum future rental payments $ 10,878
Total rent expense for operating leases was approximately $5.6 million, $5.9 million, and $5.6 million in fiscal years 2013, 2012,
and 2011, respectively.
Unconditional Purchase Obligations
The Company purchases services and components from a variety of suppliers and manufacturers. During the normal course of
business and to manage manufacturing operations and general and administrative activities, the Company may enter into firm,
non-cancelable, and unconditional purchase obligations for which amounts are not recorded in the consolidated balance sheets.
Such unconditional purchase obligations totaled $182.5 million as of March 31, 2013.
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