Subsequent Event

3 Months Ended

Mar. 31, 2017

On April 6, 2017, the Board of Directors approved Phase II (“Phase II”) of the Company’s previously announced CIP. Pursuant to Phase II, the Company plans to expand its CIP and further consolidate its Sacramento, California, and Gainesville, Virginia sites while centralizing and expanding its existing presence in Huntsville, Alabama. By 2019, the Company expects to have incurred Phase II restructuring and related costs of $122.1 million (before any anticipated Phase II incentives to be finalized with state and local authorities and recoveries through the pricing of the Company’s U.S. government contracts), consisting of employee related costs of $65.2 million, facility costs of approximately $36.2 million, and $20.7 million for other costs relating to product requalification and knowledge transfer.

The Company had previously launched Phase I of the CIP in March 2015 to maximize facility utilization, increase operational efficiency and improve the affordability of its propulsion products for customers.

The Company expects total costs associated with the CIP, before any anticipated Phase II incentives to be finalized with state and local authorities, and recoveries through the pricing of the Company’s U.S. government contracts, as follows (in millions):



Phase I costs through March 31, 2017	$	54.7
Remaining anticipated Phase I costs	58.3
Phase II costs	122.1
Total costs	$	235.1