Restructuring Costs

9 Months Ended

Feb. 27, 2022

Restructuring and Related Activities [Abstract]

During fiscal year 2020, the Company announced a restructuring plan to drive enhanced profitability, focus the business on its strategic assets and redesign the organization to be the appropriate size to compete and thrive. This includes a reduction-in-force, a reduction in leased office spaces and the sale of non-strategic assets.

The following table summarizes the restructuring costs recognized in the Company’s Consolidated Statements of Comprehensive (Loss) Income, by Business Segment, excluding discontinued operations:


(in thousands)	Curation Foods		Lifecore		Other		Total
Three Months Ended February 27, 2022
Asset write-off costs	$	3,693	$	—	$	—	$	3,693
Employee severance and benefit costs	—		—		—		—
Lease costs	1,583		—		—		1,583
Other restructuring costs	68		271		250		589
Total restructuring costs	$	5,344	$	271	$	250	$	5,865

(in thousands)	Curation Foods		Lifecore		Other		Total
Nine Months Ended February 27, 2022
Asset write-off costs	$	3,693	$	—	$	—	$	3,693
Employee severance and benefit costs	—		—		—		—
Lease costs	2,049		—		—		2,049
Other restructuring costs	68		271		2,325		2,664
Total restructuring costs	$	5,810	$	271	$	2,325	$	8,406

Asset write-off costs

Asset write-off costs are costs related to impairment or disposal of property and equipment as part of the Company's restructuring plan to drive enhanced profitability, focus the business on its strategic assets and redesign the organization to be the appropriate size to compete and thrive. These costs are included in restructuring costs within the Consolidated Statements of Statements of Comprehensive (Loss) Income.

The Company leases its main office located in Santa Maria, California (the “Santa Maria Office”). During the fiscal quarter ended February 27, 2022 the Company approved a plan to explore opportunities to sub lease its Santa Maria Office. The Santa Maria Office assets, included as lease hold improvements within property and equipment, net, has been designated as held for use within the Consolidated Balance Sheets as of February 27, 2022, as no finalized plan for disposition existed at the balance sheet date. The Company recognized a $5.3 million impairment loss, which is included in Restructuring costs within the Consolidated Statements of Statements of Comprehensive (Loss) Income ($3.7 million included in asset write-off costs related to lease hold improvements impairment and $1.6 million included in lease costs related to right-of-use asset impairment). The Company expects to complete the sublease plan within the next 12 months.

Employee severance and benefit costs

Employee severance and benefit costs are costs incurred as a result of reduction-in-force driven by our restructuring plan and closure of offices and facilities. These costs were driven primarily by the closure of our San Rafael, California office, Santa Clara, California office, and Los Angeles, California office.

Lease Costs

In August 2020, the Company closed its leased Santa Clara, California office and entered into a sublease agreement. In the fourth quarter of fiscal year 2020 the Company closed its leased Los Angeles, California office and plans to sublease the office. As noted in the Asset write-off costs section, the Company approved a plan to explore opportunities to sub lease its Santa Maria Office and expects to complete the sublease plan within the next 12 months.

Other restructuring costs

Other restructuring costs are primarily related to consulting costs incurred in connection with the execution of the Company’s restructuring plan to drive enhanced profitability, focus the business on its strategic assets, and redesign the organization to be the appropriate size to compete and thrive.

The following table summarizes the restructuring costs recognized in the Company’s Consolidated Statements of (Loss) Income, by Business Segment, since inception of the restructuring plan in fiscal year 2020 through the nine months ended February 27, 2022, excluding discontinued operations:


	Curation Foods		Lifecore		Other		Total
(in thousands)
Asset write-off costs, net	$	7,552	$	—	$	418	$	7,970
Employee severance and benefit costs	188		—		784		972
Lease costs	2,195		—		26		2,221
Other restructuring costs	102		271		4,687		5,060
Total restructuring costs	$	10,037	$	271	$	5,915	$	16,223

The total expected cost related to the restructuring plan is approximately $20.0 million.