Note 4 — Restructuring and other impairment charges

The amounts recognized in restructuring and other impairment charges for the three and six months ended June 30, 2013 and July 1, 2012 consisted of the following:


	Three Months Ended				Six Months Ended
	June 30, 2013		July 1, 2012		June 30, 2013		July 1, 2012
	(Dollars in thousands)
LMA restructuring program	$	3,941	$	—	$	6,596	$	—
2013 restructuring charges		7,350		—		7,830		—
2012 restructuring charges		1,616		265		3,066		871
2007 Arrow integration program		55		56		135		(1,875	)
In-process research and development impairment		—		—		4,494		—

Restructuring and other impairment charges	$	12,962	$	321	$	22,121	$	(1,004	)

The Company did not incur any expenses related to its 2011 restructuring program during the three and six month periods ended June 30, 2013 or July 1, 2012.

LMA Restructuring Program

In connection with the acquisition of LMA, the Company formulated a plan related to the integration of the LMA business and the Company’s businesses. The integration plan focuses on the closure of the LMA business’ corporate functions and the consolidation of manufacturing, sales, marketing, and distribution functions in North America, Europe and Asia. The charges associated with this restructuring program that are included in restructuring and other impairment charges during the three and six month periods ended June 30, 2013 were as follows:


	Three Months Ended June 30, 2013		Six Months Ended June 30, 2013
	(Dollars in thousands)
Termination benefits	$	802	$	2,826
Facility closure costs		293		374
Contract termination costs		2,839		3,281
Other restructuring costs		7		115

	$	3,941	$	6,596

A reconciliation of the changes in accrued liabilities associated with the LMA restructuring program from December 31, 2012 through June 30, 2013 is set forth in the following table:


	Termination benefits			Facility Closure Costs			Contract Termination Costs			Other Restructuring Costs			Total
	(Dollars in thousands)
Balance at December 31, 2012	$	1,744		$	—		$	277		$	12		$	2,033
Subsequent accruals		2,826			374			3,281			115			6,596
Cash payments		(2,766	)		(100	)		(3,155	)		(67	)		(6,088	)
Foreign currency translation		(28	)		(2	)		(7	)		(12	)		(49	)

Balance at June 30, 2013	$	1,776		$	272		$	396		$	48		$	2,492

As of June 30, 2013, the Company expects to incur additional restructuring charges of approximately $5 million over the remaining life of the program. Of this amount, $4 million relates to the termination of certain distributor agreements and $1 million relates to employee termination, facility closure and other costs.

2013 Restructuring Charges

The Company regularly evaluates opportunities to consolidate facilities, lower costs and improve operating efficiencies. In 2013, the Company initiated programs to consolidate manufacturing facilities in North America and warehouse facilities in Europe and terminate certain European distributor agreements in an effort to reduce costs. As a result of these actions, the Company will incur costs related to reductions in force, facility closure, contract termination and other costs. For the three and six month periods ended June 30, 2013, the Company incurred restructuring charges of $7.4 million and $7.8 million, respectively, primarily related to reductions in force, contract termination costs and charges related to expected post-closing obligations associated with its acquired businesses. As of June 30, 2013, the Company has a reserve of $3.2 million in connection with these projects.

2012 Restructuring Charges

In 2012, the Company identified opportunities to improve its supply chain strategy by consolidating its three North American warehouses into one centralized warehouse; and lower costs and improve operating efficiencies through the termination of certain distributor agreements in Europe, the closure of certain North American facilities and workforce reductions. These projects will entail costs related to reductions in force, contract terminations related distributor agreements and leases, and facility closure and other costs. For the three and six month periods ended June 30, 2013, the Company incurred restructuring charges of $1.6 million and $3.1 million, respectively, related to the aforementioned cost categories. As of June 30, 2013, the Company has a reserve of $3.3 million in connection with these projects.

2011 Restructuring Program

In 2011, the Company initiated a restructuring program at three facilities to consolidate operations and reduce costs. As of June 30, 2013, in connection with this program, the Company has a reserve of $1.5 million, which primarily relates to contract termination costs associated with a leased facility that the Company has partially vacated. The Company expects to incur additional contract termination costs of approximately $2.7 million associated with the lease termination when it has vacated the remaining portion of the premises in 2014. The payment of the lease contract termination costs will continue until 2015.

2007 Arrow Integration Program

In connection with the Company’s acquisition of Arrow International, Inc. (“Arrow”), the Company implemented a program in 2007 to integrate Arrow’s businesses into the Company’s other businesses. The aspects of this program that affect Teleflex employees and facilities (such aspects being referred to as the “2007 Arrow integration program”) are charged to earnings and classified as restructuring and impairment charges. As of June 30, 2013, the Company has a reserve of $0.4 million in connection with this program. The following table provides information relating to the charges associated with the 2007 Arrow integration program that were included in restructuring and other impairment charges in the condensed consolidated statements of income (loss) for the periods presented:


	Three Months Ended				Six Months Ended
	June 30, 2013		July 1, 2012		June 30, 2013		July 1, 2012
	(Dollars in thousands)
Facility closure costs	$	55	$	56	$	135	$	148
Contract termination costs		—		—		—		(2,023	)

	$	55	$	56	$	135	$	(1,875	)

In 2012, the Company reversed approximately $2.0 million of contract termination costs related to a settlement of a dispute involving the termination of a European distributor agreement that was established in connection with the Company’s acquisition of Arrow.

As of June 30, 2013, the Company expects future restructuring expenses associated with the 2007 Arrow integration program, if any, to be nominal.

In-process research and development impairment

During the first quarter of 2013, the Company recorded a $4.5 million IPR&D charge pertaining to a research and development project associated with the Axiom acquisition because technological feasibility had not yet been achieved and the Company determined that such technology had no future alternative use.