Sunbeam 2007 Annual Report Download - page 111

2005 primarily relate to these plans and substantially all employees under this plan have been terminated as of
December 31, 2007. For 2007, other charges primarily consist of facility closing costs ($1.8) and other costs for
professional fees and employee relocation, primarily related to the consolidation of certain non-manufacturing
processes across the segment platform ($6.2). For 2006, other charges primarily consisted of inventory moving
costs ($1.6).
Impairment costs for 2007 relate to the exit of the casino chip business, which resulted in a goodwill
impairment charge ($2.9) and the write off of certain other assets related to this business ($1.4).
Consumer Solutions Segment Reorganization
As part of the acquisition of American Household, Inc. (the “AHI Acquisition”) and The Holmes Group,
Inc. (the “THG Acquisition”) in 2005, it was determined that, due to similarities between the combined
Consumer Solutions customer base, distribution channels and operations, significant cost savings could be
achieved by integrating certain functions of these businesses, such as distribution and warehousing, information
technology and certain administrative functions. In order to leverage a shared infrastructure, the Company
initiated certain reorganization plans during 2005. Employee termination charges in 2007, 2006 and 2005 relate
to this plan and substantially all employees under this plan have been terminated as of December 31, 2007.
For 2007, other charges primarily consist of lease termination costs ($8.0) and professional fees, employee
relocation and other charges ($4.8). For 2006, other charges primarily consist of facility closing costs, ($4.2),
retention bonuses ($4.3), professional fees ($4.8), travel expenses ($1.7) and of relocation costs ($0.6). For 2005,
other charges consist of plant closing costs, professional fees, administrative costs and other charges related to
the integration of operations ($6.5).
As of December 31, 2007, $1.3 of severance and other employee benefit-related costs and $12.0 of other
costs remain accrued for these initiatives, which is primarily remaining lease obligations.
Outdoor Solutions Segment Reorganization
During 2007, the Company initiated a plan to integrate certain businesses acquired from K2 and Pure
Fishing. This plan includes in part, facility closings and headcount reductions. During 2006 and 2005, the
Company implemented various strategic initiatives in the Outdoor Solutions segment. These initiatives included
both rationalizing and outsourcing certain European manufacturing facilities and the reorganization of the
domestic sales force. Employee termination charges 2007, 2006 and 2005 relate to the implementation of these
initiatives. At December 31, 2007, the Company expects to reduce headcount by an additional 170 employees
under these plans.
For 2007, other charges include non-capitalizable costs including professional fees ($1.8), contract
termination fees ($0.8) and relocation and move costs ($2.2) and other costs ($1.8) related to the integration of
K2 and Pure Fishing. For 2005, other charges are primarily comprised of costs ($2.0) relating to travel,
relocation, retention and other related costs of key management and other personnel.
As of December 31, 2007, $4.1 of severance and other employee benefit-related costs and $4.1 of other
costs remain accrued for these initiatives.
Process Solutions Segment Reorganization
The impairment charge in 2007 primarily relate to the write down of long-lived assets used in the
production process for certain unprofitable product-lines that were exited during 2007.
99