15. Restructuring and Other Charges

Fiscal Year 2017 Activities

During fiscal year 2017, the Company recorded restructuring charges of $3.2 million related to severance, of which $2.6 million were attributable to the Brooks Semiconductor Solutions Group segment, $0.4 million were attributable to the Brooks Life Science Systems segment and $0.3 million were attributable to the company-wide restructuring action.

The restructuring charges of $2.6 million attributable to the Brooks Semiconductor Solutions Group segment consisted of $1.6 million of charges related to the actions initiated during fiscal year 2017 and $1.0 million of charges related to the actions initiated prior to fiscal year 2017. The restructuring action initiated during fiscal year 2017 was related to streamlining field service operations in order to optimize the cost structure and improve productivity. Total severance costs expected to be incurred in connection with this action are $1.6 million which were recognized entirely during fiscal year 2017. This restructuring action has been completed as of September 30, 2017. Accrued restructuring costs related to this action were $0.5 million at September 30, 2017 and are expected to be paid within the next twelve months from cash flows generated from operating activities. The $1.0 million of restructuring charges related to actions initiated prior to fiscal year 2017 consisted of $0.8 million attributable to the consolidation of the Jena, Germany repair facility into the Chelmsford, Massachusetts repair operation and $0.2 million related to the integration of Contact Co., Ltd. ("Contact") after its acquisition by the Company. Prior to fiscal year 2017, the Company initiated a restructuring action within the Brooks Semiconductor Solutions Group segment to consolidate the Company’s Jena, Germany repair facility into the Chelmsford, Massachusetts repair operation to streamline the service repair operations and reduce the overhead cost structure. Total severance costs incurred in connection with this action were $2.6 million, of which $1.8 million were recognized prior to fiscal year 2017 and $0.8 million were recognized during fiscal year 2017. This restructuring action was substantially completed as of September 30, 2017. Accrued restructuring costs related to this action were $1.0 million at September 30, 2017 and are expected to be paid within the next twelve months from cash flows generated from operating activities.

Restructuring charges of $0.3 million were related to the company-wide restructuring action initiated in fiscal year 2016. This restructuring action has been completed as of September 30, 2017 and is not expected to result in any additional restructuring charges in future periods. There were no accrued restructuring costs related to this action at September 30, 2017. The restructuring action was taken to streamline business operations, improve competitiveness and overall profitability and is expected to benefit both segments. Total severance costs incurred in connection with this action were $6.1 million, of which $5.8 million were recognized during fiscal year 2016. Severance costs incurred in connection with this action were attributable to the reduction of several positions across the company, including senior management positions.

Fiscal Year 2016 Activities

The Company recorded restructuring charges of $12.0 million during fiscal year 2016 related to severance costs which consisted primarily of $10.8 million of charges related to restructuring actions initiated during fiscal year 2016 and $1.3 million of charges related to restructuring actions initiated in prior periods.

Restructuring Actions Initiated During Fiscal Year 2016

The Company’s restructuring actions initiated during fiscal year 2016 resulted in total charges of $10.8 million, which consisted of: (i) $3.1 million of costs attributable to the Brooks Life Science Systems segment, (ii) $1.8 million of costs attributable to the restructuring action within the Brooks Semiconductor Solutions Group segment to consolidate our Jena, Germany repair facility into our Chelmsford, Massachusetts repair operation, as described above, and (iii) $5.8 million of costs related to the company-wide restructuring action, as described above.

Restructuring initiatives within the Brooks Life Science Systems segment are primarily related to streamlining the segment’s management structure, integrating acquisitions and improving profitability. During fiscal year 2016, the Company initiated several actions within the Brooks Life Science Systems segment related to integrating BioStorage, streamlining management structure and closing the segment’s Spokane, Washington facility in March 2016 and Oberdiessbach, Switzerland facility in July 2016 upon selling the building and temporarily leasing a smaller size office space until December 2016. This restructuring initiative within the Brooks Life Science Systems segment included additional actions completed during the first quarter of fiscal year 2017 which resulted in restructuring charges of $0.2 million during fiscal year 2017. These actions were finalized by the end of the first quarter of fiscal year 2017 and are not expected to result in additional restructuring charges in future periods. Total severance costs incurred in connection with these initiatives were $3.3 million, of which $3.1 million were recognized during fiscal year 2016 and $0.2 million during fiscal year 2017. Accrued restructuring costs related to these actions were $0.5 million at September 30, 2016 and were paid entirely during fiscal year 2017.

Restructuring Actions Initiated Prior to Fiscal Year 2016

The Company’s restructuring actions initiated in prior periods resulted in $1.2 million of costs attributable to the Brooks Semiconductor Solutions segment and less than $0.1 million of costs attributable to the Brooks Life Science Systems segment. These restructuring actions were primarily related to the integration of Contact, as well as the closure and transfer of the Mistelgau, Germany manufacturing operations to a contract manufacturer. Accrued restructuring costs related to these actions were $0.2 million at September 30, 2016 and were paid entirely during fiscal year 2017.

Fiscal Year 2015 Activities

The Company recorded restructuring charges of $4.7 million in fiscal year 2015, which included severance costs of $3.4 million and facility-related costs of $1.3 million.

Severance costs of $3.4 million consisted of $2.2 million of charges attributable to the Brooks Semiconductor Solutions segment and $1.3 million of costs attributable to the Brooks Life Science Systems segment. Restructuring actions within the Brooks Semiconductor Solutions Group segment were related to the integration of Dynamic Micro Systems Semiconductor Equipment GmbH (the "DMS") with the Company’s operations and the transition of manufacturing of certain products from the Company’s facility in Mistelgau, Germany to a third party contract manufacturer. Restructuring actions within the Brooks Life Science Systems segment were related to the closure of the Poway, California facility and transition of product sub-assembly manufacturing operations to the third party contract manufacturers. These restructuring plans were substantially completed on December 31, 2015.

Facility exit costs of $1.3 million were attributable to Brooks Semiconductor Solutions Group segment were related to the outsourcing of manufacturing certain of the Company’s line of Polycold cryochillers and compressors within the United States to a third party contract manufacturer. The facility exit costs represented future lease payments and expected operating costs to be paid until the termination of the facility lease. The Company terminated the lease on October 27, 2015 and fully paid the related restructuring liability during the first quarter of fiscal year 2016.

The following is a summary of activity related to the Company’s restructuring and other charges, excluding amounts related to the discontinued operations, for the fiscal years ended September 30, 2017, 2016 and 2015 (in thousands):


	Activity -Year Ended September 30, 2017
	Balance						Balance
	September 30,						September 30,
	2016		Expenses		Payments		2017
Total restructuring liabilities related to workforce termination benefits	$	5,939	$	3,226	$	(7,457)	$	1,708


	Activity -Year Ended September 30, 2016
	Balance						Balance
	September 30,						September 30,
	2015		Expenses		Payments		2016
Facility and other contract termination costs	$	433	$	25	$	(458)	$	—
Workforce-related termination benefits		1,640		12,014		(7,715)		5,939
Total restructuring liabilities	$	2,073	$	12,039	$	(8,173)	$	5,939


	Activity - Year Ended September 30, 2015
	Balance						Balance
	September 30,						September 30,
	2014		Expenses		Payments		2015
Facility and other contract termination costs	$	71	$	1,204	$	(842)	$	433
Workforce-related termination benefits		3,404		3,213		(4,977)		1,640
Total restructuring liabilities related to workforce termination benefits	$	3,475	$	4,417	$	(5,819)	$	2,073

Accrued restructuring costs of $1.7 million as of September 30, 2017 are expected to be paid during fiscal year 2018.