Note 10 - Restructuring Charges

6 Months Ended

Jul. 01, 2011

Restructuring and Related Activities Disclosure [Text Block]

10. Restructuring Charges

The Company implemented restructuring plans during the Transition Period and during fiscal years 2010 and 2009.  The goals of these plans were to bring its operational expenses to appropriate levels relative to its historical net revenues, while simultaneously implementing extensive company-wide expense-control programs.  All expenses, including adjustments, associated with the Company’s restructuring plans are included in “Restructuring charges” and/or “Income from discontinued operations, net of taxes” in the Unaudited Condensed Consolidated Statements of Operations.

In the three-month and six-month periods ended July 1, 2011, the Company recorded minimal restructuring accrual adjustments related to the Transition Period’s restructuring plan for severance and benefits (none in the three-month period ended July 1, 2011).  To date, the Company has recorded a total of $3.9 million associated with this plan, of which $3.7 million related to severance and benefit charges for affected employees who were notified of their impending employment termination date and $0.2 million related to a termination fee for vacating a facility in California.  The Company does not expect to record additional restructuring charges related to this plan in the future.

In the three-month period ended July 2, 2010, the Company recorded restructuring charges of $2.8 million related to the Company’s Transition Period restructuring plan for severance and benefits. In the six-month period ended July 2, 2010, the Company incurred the previously mentioned $2.8 million of charges plus $0.7 million related to the Company’s fiscal 2010 restructuring plan for severance and benefits and restructuring accrual adjustments of $(0.1) million related to a previous acquisition-related restructuring plan and fiscal 2009 restructuring plan due to the estimated loss on the Company’s facilities.

The activity in the restructuring accrual for all outstanding plans was as follows for the six-month period ended July 1, 2011:

	Severance and Benefits			Other Charges			Total
	(in thousands)
Accrual balance at December 31, 2010	$	881		$	350		$	1,231
Accrual adjustments		38			-			38
Cash paid		(845	)		(249	)		(1,094	)
Accrual balance at July 1, 2011	$	74		$	101		$	175

The Company anticipates that the remaining restructuring accrual balance of $0.2 million at July 1, 2011, which was reflected in “Accrued and other liabilities” in the Unaudited Condensed Consolidated Balance Sheets, will be paid out by December 31, 2011.  The remaining restructuring severance and benefits accrual balance of $0.1 million at July 1, 2011 relates to COBRA benefits, while the remaining restructuring other charges balance of $0.1 million at July 1, 2011 relates to lease obligations that end in October 2011.

The activity in the restructuring accrual for all outstanding plans was as follows for the six-month period ended July 2, 2010:

	Severance and Benefits			Other Charges			Total
	(in thousands)
Accrual balance at January 1, 2010	$	383		$	1,043		$	1,426
Transition Period Restructuring Plan Charges (1)		2,849			-			2,849
Fiscal 2010 Restructuring Plan Charges (2)		693			-			693
Accrual adjustments		-			(104	)		(104	)
Cash paid		(3,410	)		(438	)		(3,848	)
Accrual balance at July 2, 2010	$	515		$	501		$	1,016

(1) The total Transition Period restructuring plan charges included $0.5 million classified as discontinued operations that were reflected in “Income from discontinued operations, net of taxes” in the Unaudited Condensed Consolidated Statements of Operations.

(2) The charges for fiscal 2010 restructuring plan included $1,000 classified as discontinued operations in the six-month period ended July 2, 2010, which was reflected in “Income from discontinued operations, net of taxes” in the Unaudited Condensed Consolidated Statements of Operations.