OTHER OPERATING EXPENSES, NET

Other Operating Expenses, Net is comprised of the following (in thousands):



	Three Months Ended				Nine Months Ended
	September 29, 2017		September 30, 2016		September 29, 2017		September 30, 2016
Investments in capacity and capabilities	$	1,542	$	4,542	$	4,407	$	13,821
Lake Region Medical consolidations	1,456		2,908		3,623		7,355
Acquisition and integration costs	2,267		5,319		10,057		23,143
Asset dispositions, severance and other	854		272		6,528		5,057
Other consolidation and optimization initiatives	145		329		340		628
Total other operating expenses, net	$	6,264	$	13,370	$	24,955	$	50,004

Investments in Capacity and Capabilities

One of the Company’s strategic objectives is to invest in its capacity and capabilities in order to better align its resources to meet its customers’ needs and drive organic growth and profitability. Currently this initiative includes the following:


•	Functions performed at the Company’s facility in Plymouth, MN to manufacture catheters and introducers will transfer into the Company’s existing facility in Tijuana, Mexico. This initiative is expected to be substantially completed by the end of 2017 and is dependent upon our customers’ validation and qualification of the transferred products as well as regulatory approvals worldwide.

•

Functions performed at the Company’s facilities in Beaverton, OR and Raynham, MA to manufacture products for the portable medical market were transferred to a new facility in Tijuana, Mexico. Products manufactured at the Beaverton facility, which do not serve the portable medical market, were transferred to the Company’s Raynham facility. This initiative was substantially completed during the first half of 2016. The final closure of the Beaverton, OR site occurred in the fourth quarter of 2016.


•	The design engineering responsibilities previously performed at the Company’s Cleveland, OH facility were transferred to the Company’s facilities in Minnesota in 2015.


•	The realignment of the Company’s commercial sales operations was completed in 2015.

The total capital investment expected for these initiatives is between $24.0 million and $25.0 million, of which $23.4 million has been expended through September 29, 2017. Total restructuring charges expected to be incurred in connection with these initiatives are between $54.0 million and $56.0 million, of which $53.5 million has been incurred through September 29, 2017. Expenses related to this initiative are primarily recorded within the Medical segment and include the following:


•	Severance and retention: $6.0 million - $7.0 million;


•	Accelerated depreciation and asset write-offs: $3.0 million; and


•	Other: $45.0 million - $46.0 million

Other expenses primarily consist of costs to relocate certain equipment and personnel, duplicate personnel costs, excess overhead, disposal, and travel expenditures. All expenses are cash expenditures except accelerated depreciation and asset write-offs. The change in accrued liabilities related to the Company’s investments in capacity and capabilities is as follows (in thousands):



	Severance and Retention			Accelerated Depreciation/ Asset Write-offs		Other			Total
December 30, 2016	$	66		$	—	$	—		$	66
Restructuring charges	264			—		4,143			4,407
Cash payments	(259		)	—		(4,140		)	(4,399		)
September 29, 2017	$	71		$	—	$	3		$	74

(9.) OTHER OPERATING EXPENSES, NET (Continued)

Lake Region Medical Consolidations

In 2014, Lake Region Medical initiated plans to close its Arvada, CO site, consolidate its two Galway, Ireland sites into one facility, and other restructuring actions that will result in a reduction in staff across manufacturing and administrative functions at certain locations. This initiative was substantially completed by the end of 2016.

During the third quarter of 2016, the Company announced the planned closure of its Clarence, NY facility. The machined component product lines manufactured in this facility will be transferred to other Integer locations in the U.S. The project is expected to be completed by the first quarter of 2018.

The total capital investment expected to be incurred for these initiatives is between $5.0 million and $6.0 million, of which $3.2 million has been expended through September 29, 2017. Total expense expected to be incurred for these initiatives are between $20.0 million and $25.0 million, of which $14.2 million has been incurred through September 29, 2017. Expenses related to these initiatives have been and will be recorded within the Medical segment and are expected to include the following:


•	Severance and retention: $5.0 million - $7.0 million;


•	Accelerated depreciation and asset write-offs: approximately $1.0 million - $2.0 million; and


•	Other: $14.0 million - $16.0 million.

Other expenses primarily consist of production inefficiencies, moving, revalidation, personnel, training, consulting, and travel costs associated with these consolidation projects. All expenses are cash expenditures except accelerated depreciation and asset write-offs. The change in accrued liabilities related to the Lake Region Medical consolidation initiatives is as follows (in thousands):



	Severance and Retention			Accelerated Depreciation/ Asset Write-offs		Other			Total
December 30, 2016	$	729		$	—	$	402		$	1,131
Restructuring charges	1,129			—		2,494			3,623
Cash payments	(856		)	—		(2,896		)	(3,752		)
September 29, 2017	$	1,002		$	—	$	—		$	1,002

Acquisition and integration costs

During the first nine months of 2017 and 2016, the Company incurred $10.1 million and $23.1 million, respectively, in acquisition and integration costs related to the acquisition of Lake Region Medical, consisting primarily of integration costs. Integration costs primarily include professional, consulting, severance, retention, relocation, and travel costs. The first nine months of 2016 also includes transaction costs, primarily related to change-in-control payments to former Lake Region Medical executives, as well as professional and consulting fees. As of September 29, 2017 and December 30, 2016, $1.6 million and $4.5 million, respectively, of acquisition and integration costs related to the Lake Region Medical acquisition were accrued.

Total expense expected to be incurred in connection with the integration of Lake Region Medical is between $45.0 million and $50.0 million, of which $42.6 million were incurred through September 29, 2017. Total capital expenditures for this initiative are expected to be between $15.0 million and $20.0 million, of which $10.6 million were incurred through September 29, 2017.

Asset dispositions, severance and other

During the first nine months of 2017 and 2016, the Company recorded losses in connection with various asset disposals and/or write-downs. The 2017 amount also includes approximately $5.3 million in expense related to the Company’s leadership transitions, which were recorded within the corporate unallocated segment. The 2016 amount also includes legal and professional costs in connection with the Spin-off of $4.4 million. Expenses related to the Spin-off were primarily recorded within the corporate unallocated and the Medical segment. Refer to Note 2 “Divestiture” for additional information on the Spin-off.