In April 2011, we initiated a restructuring plan to realign certain management and support functions across the organization. As part of the restructuring plan, we are relocating the operations of our Direct Response business located in Medford, Oregon to Southern California early in 2012. We believe that having these operations at a single location will improve our ability to execute strategic initiatives. Direct Response operations will continue in Medford through the end of 2011.

In connection with this restructuring activity, we are incurring employee termination costs, which include retention bonuses and severance pay to personnel in Medford and at our corporate office. We are also incurring other transition costs, such as relocation assistance, additional recruiting and travel expense, information technology integration costs and other similar costs.

	Three months ended September 30, 2011

	Guitar Center		Direct Response		Corporate		Total
Employee termination costs	$	123	$	1,459	$	149	$	1,731
Employee relocation and recruiting costs		—		190		841		1,031
Other costs		343		1,861		482		2,686

Total	$	466	$	3,510	$	1,472	$	5,448

	Nine months ended September 30, 2011

	Guitar Center		Direct Response		Corporate		Total
Employee termination costs	$	265	$	2,819	$	1,302	$	4,386
Employee relocation and recruiting costs		45		418		896		1,359
Other costs		374		1,964		781		3,119

Total	$	684	$	5,201	$	2,979	$	8,864

Costs incurred during the nine months ended September 30, 2011 represent the cumulative costs recognized from inception of the restructuring plan. Restructuring and exit activity costs are included in selling, general and administrative expenses in the accompanying condensed consolidated statements of operations. The restructuring plan did not result in any impairment of property and equipment as of September 30, 2011.

Employee termination costs include retention bonuses of $3.1 million and severance payments totaling $1.3 million under employment agreements with certain executives whose positions were eliminated in the restructuring.

We expect to incur additional costs for this restructuring activity during the fourth quarter of fiscal 2011 and the first quarter of 2012. We expect to incur additional employee termination costs of $1.6 million, primarily at our Direct Response segment. We expect to incur additional relocation, recruiting and other costs of approximately $0.2 million at our Guitar Center segment, approximately $1.2 million at our Direct Response segment and approximately $1.9 million at our corporate segment.

The following table summarizes our restructuring accrual activity for the nine months ended September 30, 2011, as it relates to employee termination costs (in thousands):

	Termination Costs

Balance at December 31, 2010	$	—
Charges		4,545
Cash payments		(832	)
Change in estimated liability		(159	)

Balance at September 30, 2011	$	3,554

Changes in the estimated liability for employee termination costs resulted from greater than expected voluntary employee terminations prior to meeting the conditions necessary to receive a retention bonus payment.

Accrued termination costs are expected to be paid during the fourth quarter of 2011 and the first quarter of 2012 and are included in accrued expenses and other current liabilities in the accompanying condensed consolidated balance sheets.

Other restructuring costs are expensed as incurred. These costs are paid currently and the accrued balances were not material to our balance sheet as of September 30, 2011.

We expect to sell our owned office facility in Medford after Direct Response operations have moved to Southern California. We are currently accelerating depreciation over its expected remaining useful life and will assess for any impairment once the facility is classified as available for sale.