Stamps.com 2001 Annual Report Download - page 61

STAMPS.COM INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
The total amount of restructuring charges for the years ended December 31, 2001 and 2000 were approximately $26.0 million and $11.5
million respectively. A summary of the restructuring and cost cutting efforts for the years ended December 31, 2001 and 2000 is set forth below
(in thousands):
2000
Remaining
Provision Utilized Adjustment Provison
--------- -------- ----------
---------
December 31, 2000
Employee severance costs............... $ 3,093 $ 3,093 $ -- $ --
Contract exit fees..................... 6,154 6,154 -- --
Fixed asset disposals.................. 1,233 1,233 -- --
Facility lease expenses................ 923 923 -- --
Other.................................. 72 72 -- --
------- ------- ------- ------
Total............................... $11,475 $11,475 $ -- $ --
======= ======= ======= ======
December 31, 2001
Employee severance costs............... $ 4,623 $ 4,650 $ (27) $ --
Contract exit fees..................... 4,247 5,975 (1,728) --
Fixed asset disposals.................. 7,783 7,783 -- --
Facility lease expenses................ 8,261 5,644 -- 2,617
Write-off of investment in EncrypTix... 1,000 1,000 -- --
Other.................................. 60 60 -- --
------- ------- ------- ------
Total............................... $25,974 $25,112 $(1,755) $2,617
======= ======= ======= ======
The calculation of the restructuring costs only includes those costs for which the Company will be unable to recognize any future benefit. In
addition, the calculation of the restructuring costs requires management to make estimates and assumptions that affect the amounts reported in
the consolidated financial statements. Actual results could differ from management's assumptions and those differences may be material to the
consolidated financial statements.
12. Related Party Transactions
In October 1999, a director entered into a three-year consulting agreement with the Company to provide strategic planning services. In
exchange for his consulting services, the director received an option to purchase 36,000 shares of common stock at $35.625 per share. A
compensation element of approximately $985,000 was calculated using the Black-Scholes valuation method for the options earned during the
period. The resulting compensation expense for the three years ending December 31, 2001, 2000 and 1999 was approximately $328,000,
$328,000 and $55,000 respectively.
In November 1999, this agreement was amended to provide that the director will receive consulting fees of $2,000 per day for any special
projects on which the Company requires his services. Amounts paid related to the amended agreement for the years ended December 31, 2001,
2000 and 1999 were approximately $ 8,400, $6,400 and $0 respectively.
In June 1999, the Company entered into a consulting services agreement with a director to provide the Company with strategic planning and
business development advice, and other consulting services that the Company may request. In exchange for these services, the Company
granted the director an option to purchase 10,000 shares of common stock at an exercise price of $11.00 per share. During 1999, a
compensation element of approximately $240,000 was calculated using the Black-Scholes valuation method for the options earned during the
period. This agreement expired on October 1, 1999.
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2002. EDGAR Online, Inc.