Costs Associated with Exit and Restructuring Activities

9 Months Ended

Oct. 01, 2016

Restructuring and Related Activities [Abstract]

Costs Associated with Exit and Restructuring Activities

Costs Associated with Exit and Restructuring Activities

Total exit and restructuring charges relate to the Company's acquisition of the Enterprise business from Motorola Solutions, Inc. ("Acquisition") in October 2014, which includes organizational design changes and operating efficiencies, and the sale of the Company's WLAN business.

Total life-to-date costs for these projects of $63 million have been recorded through October 1, 2016: $13 million in the Legacy Zebra segment and $50 million in the Enterprise segment.

During the first nine months of 2016, the Company incurred exit and restructuring costs for these projects as follows (in millions):

	Cumulative costs incurred through December 31, 2015		Costs incurred for the nine months ended October 1, 2016		Cumulative costs incurred through October 1, 2016
Severance, stay bonus, and other employee-related expenses	$	37	$	14	$	51
Obligations for future non-cancellable lease payments	9		3		12
Total	$	46	$	17	$	63

Exit and restructuring charges were $1 million and $6 million for the Legacy Zebra and Enterprise segments, respectively, for the three month period ended October 1, 2016 and $4 million and $13 million, respectively, for the nine month period ended October 1, 2016. Included in the charges for the three and nine month periods ended October 1, 2016 was $4 million specific to the sale of the WLAN business. The Company expects total charges for the year ended December 31, 2016 to be in the range of $20 million to $30 million.

A rollforward of the exit and restructuring accruals is as follows (in millions):

	Three Months Ended						Nine Months Ended
	October 1, 2016			October 3, 2015			October 1, 2016			October 3, 2015
Balance at the beginning of the period	$	13		$	18		$	15		$	7
Charged to earnings	7			6			17			35
Cash paid	(4		)	(8		)	(16		)	(26		)
Reclassification to held for sale liabilities	(2		)	—			(2		)	—
Balance at the end of the period	$	14		$	16		$	14		$	16

Liabilities related to exit and restructuring activities are included in the following accounts in the consolidated balance sheets (in millions):

	October 1, 2016		December 31, 2015
Accrued liabilities	$	10	$	10
Other long-term liabilities	4		5
Total liabilities related to exit and restructuring activities	$	14	$	15

Payments of the related long-term liabilities will be completed by October 2024.