RESTRUCTURING ACTIVITIES

Fiscal year 2015:

Summary of Restructuring Plans

The Company has accruals for severance and restructuring payments as well as expected losses relating to lease terminations.

The Company’s restructuring activities in the nine months ended March 28, 2015 were as follows:



	Balance, June 28, 2014		Three Months Ended March 28, 2015 Charges		Nine Months Ended March 28, 2015								Balance, March 28, 2015		As of March 28, 2015
	Balance, June 28, 2014		Three Months Ended March 28, 2015 Charges		Charges		Cash Payments			Change in Estimates			Balance, March 28, 2015		Costs Incurred to Date		Expected Costs to be Incurred
	(in thousands)
San Jose Fab Shutdown
Severance (1)	$	—	$	152	$	6,561	$	—		$	(367	)	$	6,194	$	6,194	$	1,882
Accelerated depreciation (2)	—		9,834		18,728		—			—			—		18,728		56,185
Total San Jose Fab Shutdown	—		9,986		25,289		—			(367		)	6,194		24,922		58,067

Other Plans
Severance (1)	5,782		2,007		11,863		(13,401		)	(1,304		)	2,940		16,341		—
Lease termination losses and other (3)	9,132		2,516		3,148		(4,281		)	(3,399		)	4,600		8,881		—
Total other plans	14,914		4,523		15,011		(17,682		)	(4,703		)	7,540		25,222		—

Total restructuring plans	$	14,914	$	14,509	$	40,300	$	(17,682	)	$	(5,070	)	$	13,734	$	50,144	$	58,067

In Balance Sheets:
Accrued salary and related expenses	$	5,782											$	5,422
Accrued expenses	$	4,276											$	7,259
Other liabilities	$	4,856											$	1,053

(1) Charges and change in estimates are included in Severance and restructuring expenses in the accompanying Condensed Consolidated Statements of Income.

(2) Charges and change in estimates are included in Cost of goods sold in the accompanying Condensed Consolidated Statements of Income.

(3) Charges and change in estimates are included in Severance and restructuring expenses and Other operating expenses (income), net in the accompanying Condensed Consolidated Statements of Income.

San Jose Fab Shutdown

On October 23, 2014, the Company initiated a plan to shut down its San Jose wafer fabrication facility. The Company reached the decision that it was not economically feasible to maintain this facility, which is used primarily for fab process development and low volume manufacturing, as the Company intends to utilize other resources to complete such activities in the future. This plan includes cash charges related to employee severance and non-cash charges related to accelerated depreciation.

During the nine months ended March 28, 2015, the Company recorded accelerated depreciation charges of $18.7 million in “Cost of goods sold” and $6.6 million in “Severance and restructuring expenses” in the Condensed Consolidated Statements of Income. The Company expects to incur a total of approximately $83.0 million of accelerated depreciation and severance charges related to this plan which it expects to complete during fiscal year 2016.

Other Plans

During the nine months ended March 28, 2015, the Company recorded $11.9 million in “Severance and restructuring expenses” in the Condensed Consolidated Statements of Income related to various restructuring plans designed to reduce costs. These charges were associated with the reorganization of certain business units and functions. Multiple job classifications and locations were impacted by these activities.

The Company also accrued for expected losses relating to lease terminations as a result of plans to consolidate office space. The need for consolidation resulted from acquisition and relocation activities.

Fiscal year 2014:

Volterra Restructuring Plan

In connection with the acquisition of Volterra, the Company’s management approved and initiated plans to restructure the operations of Volterra, including acceleration of certain stock-based compensation awards, costs to vacate duplicative facilities, severance for transitional and exiting employees, contract cancellation costs and other items. The total combined cost of the plan was $10.6 million in "Severance and restructuring expenses" in the Company’s Condensed Consolidated Statements of Income. As of March 29, 2014, the Company recorded all of the costs of the plan based upon the anticipated timing of planned terminations and facility closure costs. Expected severance and retention costs for transitional employees are being accrued over the transitional period. Amounts accrued and future estimated costs to be incurred as of March 29, 2014 are immaterial.

Business Unit Reorganization

During the nine months ended March 29, 2014, the Company recorded $8.5 million in "Severance and restructuring expenses" in the Company’s Condensed Consolidated Statements of Income associated with the reorganization of certain business units. Multiple job classifications and locations were impacted as this was a company-wide action. The reorganization was driven by the desire to focus on specific investment areas and simplify business processes.