IMPAIRMENT OF LONG-LIVED ASSETS

The Company assesses long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of such assets (or asset group) may not be recoverable. Based on management’s review of the historical operating performance, including sales trends, gross margin rates, current cash flows from operations and the projected outlook for each of the Company’s stores, the Company determined that certain stores would not be able to generate sufficient cash flows over the remaining term of the related leases to recover the Company’s investment in the respective stores. As a result, the Company recorded the following non-cash impairment charges related to its retail stores within the accompanying Condensed Consolidated Statements of Operations and Comprehensive Operations, to write-down the carrying value of its long-lived store assets to their estimated fair values.



	For the Third Quarter Ended				For the Three Quarters Ended
	(In thousands)
	November 1, 2014		November 2, 2013		November 1, 2014		November 2, 2013
Impairment charges from continuing operations	$	377	$	600	$	2,040	$	2,031



	November 1, 2014		November 2, 2013
	(In thousands)
Carrying value of assets tested for impairment	$	1,466	$	3,803
Carrying value of assets with impairment	$	558	$	822
Fair value of assets impaired	$	181	$	222
Number of stores tested for impairment	48		57
Number of stores with impairment	12		8

The long-lived assets disclosed above that were written down to their respective fair values consisted primarily of leasehold improvements, furniture, fixtures and equipment. The Company recognized impairment charges of $0.4 million and $0.6 million, respectively, during the third quarters ended November 1, 2014 and November 2, 2013 and $2.0 million during each of the first three quarters of fiscal 2014 and 2013, respectively. The decrease in the number of stores tested for impairment year-over-year was primarily related to the Company’s closure of certain under-performing stores and the improved financial performance of the remaining store base. Based on historical operating performance and the projected outlook for a subset of the stores tested for impairment as of November 1, 2014, the Company believes that the remaining asset value of approximately $0.2 million is recoverable. In addition, during the third quarter of 2014, the Company determined that certain software previously capitalized for internal use was abandoned. As a result, the Company recorded an impairment charge of $1.1 million and accrued approximately $0.4 million related to future software maintenance costs.

See Note 10, "Fair Value Measurements" for further discussion related to impairment of long-lived assets.