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Restructuring

12 Months Ended

Dec. 31, 2012

16. Restructuring

In 2009, the Company restructured its business operations to rationalize its cost structure in an uncertain economic environment. The restructuring included plans for the relocation and consolidation of its Ellicottville, New York operations into its Texas facility. This planned relocation resulted in severance and payroll charges during the year ended December 31, 2009 of $264,000. At December 31, 2012 the balance remaining of such payments was $27,900 and the Company expects to make such payment before March 31, 2013.

During the second quarter of 2012, the Company commenced the Ellicottville relocation, resulting in the realization of expense for discontinued inventory, severance and professional fees to complete the move. As a result, the Company recorded a restructuring charge in 2012 of approximately $283,900.

When completed, the restructuring and relocation is expected to result in approximately $240,000 in annual cost savings. Accrued restructuring expenses of $39,900 are included in “Other accrued expenses” in the Company’s consolidated balance sheet, while the $89,000 increase to inventory obsolescence is included in “Inventory reserve.”

The following table analyzes the changes incurred related to the Company’s reserve with respect to the restructuring plan for the year ended December 31, 2012:


	December 31, 2011		Expense/ (Benefit)		Payment/Charges			December 31, 2012
Severance	$	111,000	$	64,000	$	(147,100	)	$	27,900
Professional Fees		—		42,000		(42,000	)		—
Inventory		—		89,000		—			89,000
Other		12,000		88,900		(88,900	)		12,000

Total	$	123,000	$	283,900	$	(278,000	)	$	128,900

The following table analyzes the changes incurred related to the Company’s reserve with respect to the restructuring plan for the year ended December 31, 2011:


	December 31, 2010		Expense/ (Benefit)		Payment/Charges			December 31, 2011
Severance	$	132,000	$	—	$	(21,000	)	$	111,000
Other		12,000		—		—			12,000

Total	$	144,000	$	—	$	(21,000	)	$	123,000

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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