The Company announced in March 2021 plans to streamline its organization through reductions in its workforce, primarily in certain international markets, and to reduce its real estate footprint, including reductions in office space and select store closures, which are expected to result in annual cost savings of approximately $60 million. In connection with these activities, the Company recorded pre-tax costs during the thirteen and twenty-six weeks ended August 1, 2021 and expects to incur total costs as follows:


(In millions)	Total Costs Expected to be Incurred		Costs Incurred During the Thirteen Weeks Ended 8/1/21		Costs Incurred During the Twenty-Six Weeks Ended 8/1/21
Severance, termination benefits and other employee costs	$	20.9	$	1.0	$	13.2
Long-lived asset impairments	28.1		—		28.1

Contract termination and other costs	11.0		0.8		3.8

Total	$	60.0	$	1.8	$	45.1

Of the charges incurred during the twenty-six weeks ended August 1, 2021, $1.7 million relate to SG&A expenses of the Tommy Hilfiger North America segment, $7.1 million relate to SG&A expenses of the Tommy Hilfiger International segment, $2.1 million relate to SG&A expenses of the Calvin Klein North America segment, $5.7 million relate to SG&A expenses of the Calvin Klein International segment and $28.5 million relate to corporate SG&A expenses not allocated to any reportable

segment. The Company expects to incur total costs of approximately $60 million during 2021 in connection with these activities, of which approximately $2 million is expected to relate to SG&A expenses of the Tommy Hilfiger North America segment, approximately $17 million is expected to relate to SG&A expenses of the Tommy Hilfiger International segment, approximately $2 million is expected to relate to SG&A expenses of the Calvin Klein North America segment, approximately $9 million is expected to relate to SG&A expenses of the Calvin Klein International segment, and approximately $30 million is expected to relate to corporate SG&A expenses not allocated to any reportable segment. Please see Note 20, “Segment Data,” for further discussion of the Company’s reportable segments.

Please see Note 13, “Fair Value Measurements,” for further discussion of the long-lived asset impairments recorded during the twenty-six weeks ended August 1, 2021.

The liabilities at August 1, 2021 related to these costs were principally recorded in accrued expenses in the Company’s Consolidated Balance Sheet and were as follows:


(In millions)	Liability at 1/31/21		Costs Incurred During the Twenty-Six Weeks Ended 8/1/21		Costs Paid During the Twenty-Six Weeks Ended 8/1/21		Liability at 8/1/21
Severance, termination benefits and other employee costs	$	—	$	13.2	$	2.6	$	10.6
Contract termination and other costs	—		3.8		3.4		0.4
Total	$	—	$	17.0	$	6.0	$	11.0

The Company announced on July 14, 2020 plans to streamline its North American operations to better align its business with the evolving retail landscape, including the exit from its Heritage Brands Retail business, which consisted of 162 directly operated stores in North America and was substantially completed in the second quarter of 2021. In connection with the exit from the Heritage Brands Retail business, the Company recorded pre-tax costs during 2020 and the thirteen and twenty-six weeks ended August 1, 2021 as shown in the following table. All expected costs related to the exit from the Heritage Brands Retail business were substantially incurred by August 1, 2021.


(In millions)	Costs Incurred During the Thirteen Weeks Ended 8/1/21		Costs Incurred During the Twenty-Six Weeks Ended 8/1/21		Cumulative Costs Incurred
Severance, termination benefits and other employee costs	$	5.7	$	10.8	$	25.4
Long-lived asset impairments	—		—		7.2
Accelerated amortization of lease assets	3.0		5.9		13.1
Contract termination and other costs	4.4		4.4		4.4

Total	$	13.1	$	21.1	$	50.1

The costs incurred during 2020 and the twenty-six weeks ended August 1, 2021 relate to SG&A expenses of the Heritage Brands Retail segment. Please see Note 20, “Segment Data,” for further discussion of the Company’s reportable segments.

The liabilities at August 1, 2021 related to these costs were principally recorded in accrued expenses in the Company’s Consolidated Balance Sheet and were as follows:


(In millions)	Liability at 1/31/21		Costs Incurred During the Twenty-Six Weeks Ended 8/1/21		Costs Paid During the Twenty-Six Weeks Ended 8/1/21		Liability at 8/1/21
Severance, termination benefits and other employee costs	$	12.6	$	10.8	$	4.2	$	19.2
Contract termination and other costs	—		4.4		0.8		3.6
Total	$	12.6	$	15.2	$	5.0	$	22.8

The Company also announced on July 14, 2020 a reduction in its North America office workforce by approximately 450 positions, or 12%, across all three brand businesses and corporate functions (the “North America workforce reduction”). In connection with the North America workforce reduction, the Company recorded pre-tax costs of $39.7 million during 2020, which consisted of severance, termination benefits and other employee costs. All expected costs related to the North America workforce reduction were incurred during 2020.

The liabilities at August 1, 2021 related to these costs were principally recorded in accrued expenses in the Company’s Consolidated Balance Sheet and were as follows: