RESTRUCTURING ACTIVITIES

Ralcorp Related Restructuring Plan

We are incurring costs in connection with actions taken due to the ongoing integration and restructuring of the recently acquired operations of Ralcorp (the "Ralcorp Related Restructuring Plan"). The plan is expected to include steps to, among other things, improve operational effectiveness and reduce costs, integrate headquarter functions across the organization, and optimize manufacturing assets and distribution networks, as a result of which we expect to incur material charges for exit and disposal activities under generally accepted accounting principles. At the time of the acquisition of Ralcorp, we anticipated that we would need to take restructuring actions in integrating Ralcorp and since that time have been evaluating, and continue to evaluate, such actions. We are currently unable, in good faith, to make a determination of an estimate of the total amount or range of amounts for each major type of cost expected to be incurred in connection with the Ralcorp Related Restructuring Plan, an estimate of the total amount or range of amounts expected to be incurred in connection with the Ralcorp Related Restructuring Plan, or an estimate of the amount or range of amounts of the charges that will result in future cash expenditures. We are also currently unable to determine the duration of the Ralcorp Related Restructuring Plan, but expect that the Ralcorp Related Restructuring Plan will be implemented over a multi-year period.

During fiscal 2013, we recognized the following pre-tax expenses for the Ralcorp Related Restructuring Plan:



	Corporate		Total
Multi-employer pension costs	$	11.2	$	11.2
Total cost of goods sold	11.2		11.2
Severance and related costs	17.2		17.2
Total selling, general and administrative expenses	17.2		17.2
Consolidated total	$	28.4	$	28.4

Included in the above results are $28.4 million of charges that have resulted or will result in cash outflows.

Liabilities recorded for the Ralcorp Related Restructuring Plan and changes therein for fiscal 2013 were as follows:



	Balance at May 27, 2012		Costs Incurred and Charged to Expense		Costs Paid or Otherwise Settled		Changes in Estimates		Balance at May 26, 2013
Multi-employer pension costs	$	—	$	11.2	$	—	$	—	$	11.2
Severance and related costs	—		17.2		—		—		17.2
Total	$	—	$	28.4	$	—	$	—	$	28.4

Acquisition-related restructuring

We are incurring costs in connection with actions taken to attain synergies when integrating businesses acquired prior to the third quarter of fiscal 2013. These costs, collectively referred to as "acquisition-related exit costs", include severance and other costs associated with consolidating facilities and administrative functions. In connection with the acquisition-related exit costs, we expect to incur pre-tax cash and non-cash charges for severance, relocation, and other site closure costs of $14.3 million. At the end of fiscal 2013, the acquisition-related restructuring costs were substantially complete.

Included in the estimates of $14.3 million of charges are $10.2 million of charges that have resulted or will result in cash outflows and $4.1 million of non-cash charges.

During fiscal 2013, we recognized the following pre-tax expenses for acquisition-related exit costs:



	Consumer Foods			Corporate		Total
Accelerated depreciation of fixed assets	$	(0.2	)	$	—	$	(0.2	)
Total cost of goods sold	(0.2		)	—		(0.2		)
Severance and related costs	4.7			—		4.7
Asset impairment	1.6			2.5		4.1
Other, net	0.9			—		0.9
Total selling, general and administrative expenses	7.2			2.5		9.7
Consolidated total	$	7.0		$	2.5	$	9.5

We recognized the following cumulative (plan inception to May 26, 2013) pre-tax acquisition-related exit costs in our consolidated statement of earnings:



	Consumer Foods		Corporate		Total
Severance and related costs	$	9.0	$	—	$	9.0
Asset impairment	1.6		2.5		4.1
Other, net	0.9		—		0.9
Total selling, general and administrative expenses	11.5		2.5		14.0
Consolidated total	$	11.5	$	2.5	$	14.0

Liabilities recorded for acquisition-related restructuring and changes therein for fiscal 2013 were as follows:



	Balance at May 27, 2012		Costs Incurred and Charged to Expense		Costs Paid or Otherwise Settled			Changes in Estimates			Balance at May 26, 2013
Severance and related costs	$	4.3	$	6.1	$	(7.8	)	$	(1.4	)	$	1.2
Plan implementation costs	—		0.9		(0.6		)	—			0.3
Total	$	4.3	$	7.0	$	(8.4	)	$	(1.4	)	$	1.5

Administrative Efficiency Restructuring Plan

In August 2011, we made a decision to reorganize our Consumer Foods sales function and certain other administrative functions within our Commercial Foods and Corporate reporting segments. These actions, collectively referred to as the "Administrative Efficiency Plan", are intended to improve the efficiency and effectiveness of the affected sales and administrative functions. In connection with the Administrative Efficiency Plan, we have incurred approximately $18.7 million of pre-tax cash and non-cash charges, primarily for severance and costs of employee relocation. At the end of fiscal 2013, the Administrative Efficiency Plan was substantially complete.

We recognized the following pre-tax expenses associated with the Administrative Efficiency Plan in the fiscal 2012 to 2013 timeframe:



	Consumer Foods		Commercial Foods		Corporate		Total
Accelerated depreciation	$	—	$	—	$	1.5	$	1.5
Severance and related costs	7.1		—		2.2		9.3
Other, net	6.7		1.0		0.2		7.9
Total selling, general and administrative expenses	13.8		1.0		3.9		18.7
Consolidated total	$	13.8	$	1.0	$	3.9	$	18.7

Included in the above results are $16.8 million of charges that have resulted or will result in cash outflows and $1.9 million of non-cash charges.

During fiscal 2013, we recognized the following pre-tax expenses associated with the Administrative Efficiency Plan:



	Consumer Foods		Corporate		Total
Accelerated depreciation	$	—	$	0.4	$	0.4
Severance and related costs	0.9		—		0.9
Other, net	0.7		—		0.7
Total selling, general and administrative expenses	1.6		0.4		2.0
Consolidated total	$	1.6	$	0.4	$	2.0

Liabilities recorded for the various initiatives and changes therein for fiscal 2013 under the Administrative Efficiency Plan were as follows:



	Balance at May 27, 2012		Costs Incurred and Charged to Expense		Costs Paid or Otherwise Settled			Changes in Estimates			Balance at May 26, 2013
Severance and related costs	$	2.1	$	1.3	$	(2.8	)	$	(0.2	)	$	0.4
Plan implementation costs	0.3		0.2		(0.5		)	—			—
Total	$	2.4	$	1.5	$	(3.3	)	$	(0.2	)	$	0.4

Network Optimization Plan

During the third quarter of fiscal 2011, our Board of Directors approved a plan designed to optimize our manufacturing and distribution networks. We refer to this plan as the "Network Optimization Plan". The Network Optimization Plan consists of projects that involve, among other things, the exit of certain manufacturing facilities, the disposal of underutilized manufacturing assets, and actions designed to optimize our distribution network. At the end of fiscal 2013, the Network Optimization Plan was substantially complete.

In connection with the Network Optimization Plan, we have incurred pre-tax cash and non-cash charges of $76.7 million. We have recognized expenses associated with the Network Optimization Plan, including but not limited to, impairments of property, plant and equipment, accelerated depreciation, severance and related costs, and plan implementation costs (e.g., consulting and employee relocation). We recognized the following pre-tax expenses associated with the Network Optimization Plan in the fiscal 2011 to fiscal 2013 timeframe:



	Consumer Foods			Commercial Foods		Corporate		Total
Accelerated depreciation	$	22.5		$	—	$	—	$	22.5
Inventory write-offs and related costs	7.5			0.4		—		7.9
Total cost of goods sold	30.0			0.4		—		30.4
Asset impairment	15.3			14.0		—		29.3
Net gains on sale of property, plant and equipment	(1.6		)	—		—		(1.6		)
Severance and related costs	7.7			0.1		—		7.8
Other, net	8.5			1.5		0.8		10.8
Total selling, general and administrative expenses	29.9			15.6		0.8		46.3
Consolidated total	$	59.9		$	16.0	$	0.8	$	76.7

Included in the above results are $17.9 million of charges that have resulted or will result in cash outflows and $58.8 million of non-cash charges.

During fiscal 2013, we recognized the following pre-tax expenses associated with the Network Optimization Plan:



	Consumer Foods			Corporate		Total
Accelerated depreciation	$	2.0		$	—	$	2.0
Inventory write-offs and related costs	0.6			—		0.6
Total cost of goods sold	2.6			—		2.6
Asset impairment	1.4			—		1.4
Net gains on sale of property, plant and equipment	(1.0		)	—		(1.0		)
Severance and related costs	(1.8		)	—		(1.8		)
Other, net	2.3			0.8		3.1
Total selling, general and administrative expenses	0.9			0.8		1.7
Consolidated total	$	3.5		$	0.8	$	4.3

Liabilities recorded for the various initiatives and changes therein for fiscal 2013 under the Network Optimization Plan were as follows:



	Balance at May 27, 2012		Costs Incurred and Charged to Expense		Costs Paid or Otherwise Settled			Changes in Estimates			Balance at May 26, 2013
Severance and related costs	$	7.0	$	1.0	$	(4.5	)	$	(3.3	)	$	0.2
Plan implementation costs	0.8		2.7		(3.5		)	—			—
Total	$	7.8	$	3.7	$	(8.0	)	$	(3.3	)	$	0.2

2010 Restructuring Plan

During fiscal 2010, our Board of Directors approved a plan related to the long-term production of our meat snack products. The plan provided for the closure of our meat snacks production facility in Garner, North Carolina, and the movement of production to our existing facility in Troy, Ohio.

Also in fiscal 2010, we made a decision to consolidate certain administrative functions from Edina, Minnesota to Naperville, Illinois. We completed the transition of these functions in fiscal 2011. This plan, together with the plan to move production of our meat snacks from Garner, North Carolina to Troy, Ohio, is collectively referred to as the 2010 restructuring plan ("2010 plan").

In connection with the 2010 plan, we incurred pre-tax cash and non-cash charges of $67.3 million cumulatively since inception, of which $2.6 million was recognized in fiscal 2012 and $25.7 million was recognized in fiscal 2011. By the end of fiscal 2012, the 2010 plan was complete.

Ralcorp Pre-acquisition Restructuring Plans

At the time of our acquisition of Ralcorp, management of Ralcorp had initiated certain activities designed to optimize Ralcorp's manufacturing and distribution networks. We refer to these actions and the related costs as "Ralcorp Pre-acquisition Restructuring Plans". The Ralcorp Pre-acquisition Restructuring Plans involve, among other things, the exit of certain manufacturing facilities, the disposal of underutilized manufacturing assets, and actions designed to optimize the Ralcorp distribution network. We expect to incur $3.2 million of charges that have resulted or will result in cash outflows associated with the Ralcorp Pre-acquisition Restructuring Plans. In fiscal 2013, we recognized charges of $1.3 million in relation to the Ralcorp Pre-acquisition Restructuring Plans. For activities initiated after our acquisition of Ralcorp, refer to the Ralcorp Related Restructuring Plan.