Restructuring Charges

9 Months Ended

Aug. 31, 2019

The following table provides a summary of activity for our restructuring actions, which are detailed further below (in thousands):



	Excess Facilities and Other Costs			Employee Severance and Related Benefits			Total
Balance, December 1, 2018	$	307		$	4		$	311
Costs incurred	676			3,317			3,993
Cash disbursements	(527		)	(1,608		)	(2,135		)
Translation adjustments and other	(103		)	(3		)	(106		)
Balance, August 31, 2019	$	353		$	1,710		$	2,063

2019 Restructuring

During the second quarter of fiscal year 2019, we restructured our operations in connection with the acquisition of Ipswitch (Note 6). This restructuring resulted in a reduction in redundant positions, primarily within administrative functions of Ipswitch. We expect to incur additional expenses as part of this action related to employee costs and facility closures as we consolidate offices in various locations during fiscal years 2019 and 2020.

Restructuring expenses incurred to date are related to employee costs, including severance, health benefits and outplacement services (but excluding stock-based compensation).

As part of this fiscal year 2019 restructuring, for the three and nine months ended August 31, 2019, we incurred expenses of $0.6 million and $3.3 million, respectively, which are recorded in restructuring expenses on the condensed consolidated statements of operations.

A summary of the first nine months of fiscal year 2019 activity for this restructuring action is as follows (in thousands):



	Excess Facilities and Other Costs		Employee Severance and Related Benefits			Total
Balance, December 1, 2018	$	—	$	—		$	—
Costs incurred	—		3,313			3,313
Cash disbursements	—		(1,600		)	(1,600		)
Translation adjustments and other	—		(3		)	(3		)
Balance, August 31, 2019	$	—	$	1,710		$	1,710

Cash disbursements for expenses incurred to date under this restructuring are expected to be made through the second quarter of fiscal year 2020. Accordingly, the balance of the restructuring reserve of $1.7 million is included in other accrued liabilities on the condensed consolidated balance sheet at August 31, 2019.

2017 Restructuring

During fiscal year 2017, we undertook certain operational restructuring initiatives intended to significantly reduce annual costs. As part of this action, management committed to a new strategic plan highlighted by a new product strategy and a streamlined operating approach. To execute these operational restructuring initiatives, we reduced our global workforce by over 20%. These workforce reductions occurred in substantially all functional units and across all geographies in which we operate. We also consolidated offices in various locations during fiscal years 2017 and 2018 and the first nine months of fiscal year 2019. We expect to incur additional expenses related to facility closures as part of this restructuring action through fiscal year 2019, but we do not expect these additional costs to be material.

Restructuring expenses are related to employee costs, including severance, health benefits and outplacement services (but excluding stock-based compensation), facilities costs, which include fees to terminate lease agreements and costs for unused space, net of sublease assumptions, and other costs, which include asset impairment charges.

As part of this fiscal year 2017 restructuring, for the three and nine months ended August 31, 2019, we incurred expenses of $0.2 million and $0.7 million, respectively, which are recorded in restructuring expenses on the condensed consolidated statements of operations.

A summary of the first nine months of fiscal year 2019 activity for this restructuring action is as follows (in thousands):



	Excess Facilities and Other Costs			Employee Severance and Related Benefits			Total
Balance, December 1, 2018	$	307		$	4		$	311
Costs incurred	676			4			680
Cash disbursements	(527		)	(8		)	(535		)
Translation adjustments and other	(103		)	—			(103		)
Balance, August 31, 2019	$	353		$	—		$	353

Cash disbursements for expenses incurred to date under this restructuring are expected to be made through fiscal year 2019. Accordingly, the balance of the restructuring reserve of $0.4 million is included in other accrued liabilities on the condensed consolidated balance sheet at August 31, 2019.