NOTE F – Costs Associated with Exit and Restructuring Activities

During December of 2012, CTS realigned its operations to suit the business needs of the Company. These realignment actions resulted in the elimination of approximately 190 positions. These actions were completed as of March 31, 2013.

Approximately $200,000 of the remaining restructuring and restructuring-related charges were incurred in the first quarter of 2013. Restructuring and impairment charges are reported on a separate line on the Consolidated Statements of Earnings (loss). Restructuring-related charges are reported as a component of Cost of Goods Sold on the Consolidated Statements of Earnings (loss).

The following table displays the restructuring reserve activity related to the December 2012 Plan:


*($ in thousands)*	December 2012 Plan
Restructuring liability at January 1, 2013		$	1,600
Restructuring and restructuring-related charges, excluding asset impairments and write-offs			800
Cost paid			(2,400	)

Restructuring liability at December 31, 2013		$	—

During June of 2013, CTS announced plans to further restructure its operations to align its operations to the business needs of the Company. These restructuring actions will result in the elimination of approximately 350 positions. These actions are expected to be completed in 2014. The following table displays the planned restructuring and restructuring-related charges associated with the realignment, as well as a summary of the actual costs incurred through June 29, 2014:


*($ in thousands)*	June 2013 Plan	Planned Costs		Actual costs incurred through June 29, 2014
Workforce reduction		$	8,300	$	7,799
Asset impairment charge			3,000		3,849
Other charges, including pension termination costs			5,500		525

Restructuring and impairment charges		$	16,800	$	12,172


Inventory write-down		$	800	$	1,143
Equipment relocation			900		852
Other charges			100		491

Restructuring-related charges, included in cost of goods sold		$	1,800	$	2,486


Total restructuring and restructuring-related charges		$	18,600	$	14,658

Approximately $1,074,000 of restructuring and restructuring related charges were incurred in the first quarter of 2014, while $667,000 of charges were incurred in the second quarter of 2014. Of the restructuring and restructuring-related charges incurred for the June 2013 plan, $667,000 was included in continuing operations for the three month period ended June 29, 2014, and $1,741,000 was included in continuing operations for the six month period ended June 29, 2014. Restructuring and impairment charges from continuing operations are reported on a separate line on the Consolidated Statements of Operations. Restructuring-related charges from continuing operations that are reported as a component of Cost of goods sold on the Consolidated Statements of Operations are $338,000 for the three month period ended June 29, 2014 and $910,000 for the six month period ended June 29, 2014.

The restructuring activities discussed above will simplify CTS’ global footprint by consolidating manufacturing facilities into existing locations. This plan includes the consolidation of operations from the U.K. manufacturing facility into the Czech Republic facility, the Carol Stream, Illinois manufacturing facility into the Juarez, Mexico facility and to discontinue manufacturing at its Singapore facility.

During April of 2014, CTS announced plans to further restructure its operations to align its operations to the business needs of the Company by closing its Canadian manufacturing operation. These restructuring actions will result in the elimination of approximately 120 positions. These actions are expected to be completed in 2015. The following table displays the planned restructuring and restructuring-related charges associated with the realignment, as well as a summary of the actual costs incurred through June 29, 2014:


*($ in thousands)*	April 2014 Plan	Planned Costs		Actual costs incurred through June 29, 2014
Workforce reduction		$	4,100	$	2,405
Asset impairment charge			0		0
Other charges, including pension termination costs			500		0

Restructuring and impairment charges		$	4,600	$	2,405


Inventory write-down		$	250	$	0
Equipment relocation			500		0
Other charges			350		0

Restructuring-related charges, included in cost of goods sold		$	1,100	$	0


Total restructuring and restructuring-related charges		$	5,700	$	2,405

All of restructuring and restructuring related charges were incurred in the second quarter of 2014. Of the restructuring and restructuring-related charges incurred for the April 2014 Plan, all charges were included in continuing operations.

The following table displays the restructuring reserve activity for the period ended June 29, 2014:


*($ in thousands)*	June 2013 Plan and April 2014 Plan
Restructuring liability at January 1, 2014		$	3,100
Restructuring and restructuring-related charges, excluding asset impairments and write-offs			4,067
Cost paid			(3,831	)

Restructuring liability at June 29, 2014		$	3,336

The restructuring activities discussed above will consolidate its Canadian operation into other existing CTS facilities as part of CTS’ overall plan to simplify its business model and rationalize its global footprint.