Restructuring and Impairment Charges

12 Months Ended

Jun. 29, 2013

Restructuring and Related Activities [Abstract]

In the fourth quarter of fiscal year 2011, we implemented plans to close or divest three facilities and incurred a charge of $1,663 associated with these plans. This charge was recorded in the “Selling and administrative” line item of our Consolidated Statements of Operations.

There were no material restructuring or impairment charges in fiscal year 2012.

In the fourth quarter of fiscal year 2013, we closed one of our rental facilities and restructured our direct sale business. The rental facility had become redundant as a result of the acquisition we made earlier in the fiscal year. In addition, we made the decision to transition our GKdirect Catalog business to a third-party catalog offering and outsource the fulfillment operations. This change resulted in the discontinuance of certain product offerings and the establishment of $1,445 of lower of cost or market reserves to reduce the carrying amount of inventory to its estimated net realizable value. In addition, we incurred charges for equipment write-downs and severance related to the closure of the distribution center. Also, as part of our annual fourth quarter impairment test and recent changes in our GKdirect Program business, we identified certain impairment indicators that required us to perform an assessment of the recoverability of the long-lived assets related to the business. As part of this assessment, we determined that the carrying value of certain long-lived assets exceeded their fair values. The estimated fair values were determined using a discounted cash flow approach. This analysis resulted in the impairment of certain long-lived assets, including computer software, customer contracts and other property and equipment. Finally, the changes to our GKdirect Program business noted above resulted in an evaluation of the recoverability of related inventory. As part of this evaluation we established $2,166 of additional reserves to reduce inventory to its net realizable value based on our updated business plan.

The following table identifies the major components of the fiscal year 2013 fourth quarter charges restructuring and impairment charges and the corresponding income statement line items:



Asset	Statement of Operations Classification:	Amount
Inventory	Cost of direct sales	$	3,611
Property, plant and equipment	Selling and administrative	1,985
Customer contracts	Selling and administrative	1,626
Computer software	Selling and administrative	1,704
Other costs	Selling and administrative	907
Total restructuring and impairment charges		9,833

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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