Exit and Disposal Activities

The Company has initiated various exit and disposal activities including, but not limited to, the matters described below. Employee separation expenses are comprised of severance, outplacement and retention bonus payments. Other costs include expenses associated with asset write-downs, terminating contractual arrangements, costs to prepare facilities for closure, and costs to move equipment and products to other facilities.

Manufacturing Rationalization and Relocation Initiatives

The Company's Board of Directors have approved several initiatives including: (i) construction of two new manufacturing facilities on a campus in Mexico to be shared by the RCH and CAS segments (completed in the first quarter of 2014), which will provide an integrated manufacturing footprint for both RCH and CAS; (ii) consolidation of two North American manufacturing facilities in the RCH segment into the new, shared facility in Mexico; (iii) transfer of product manufacturing from certain manufacturing facilities in the CAS segment to the new, shared campus in Mexico, as well as transferring and expanding parts and sub-assembly operations in Mexico; and (iv) further consolidation of North American manufacturing operations, among other things, in the CAS segment (collectively, the "Manufacturing Rationalization & Relocation Initiatives").

The Company expects that the range of total cost to complete the Manufacturing Rationalization & Relocation Initiatives is as follows:



	Low⁽¹⁾		High ⁽¹⁾
	(Dollar amounts in millions)
Employee-related costs	$	10.0	$	11.0
Other costs, including machinery and equipment relocation and installation	9.0		10.0
	$	19.0	$	21.0


(1)	The range of total estimated exit and disposal activities by segment are as follows:



	Low		High
	(Dollar amounts in millions)
RCH	$	16.5	$	18.0
CAS	2.5		3.0
	$	19.0	$	21.0

Cash expenditures began in the second quarter of 2013 and are expected to continue through fiscal year 2015. In connection with the Manufacturing Rationalization & Relocation Initiatives, the Company has incurred cumulative costs of approximately $12.1 million (of which approximately $11.1 million and $1.0 million were recorded in the RCH and CAS segments, respectively).

The following table sets forth the changes to the liability for the Manufacturing Rationalization & Relocation Initiatives during the nine months of 2014:



	Severance			Other Costs			Total
	(Dollar amounts in millions)

Balance, December 31, 2013	$	7.0		$	—		$	7.0
Provision ⁽¹⁾	1.0			2.8			3.8
Payments	(1.3		)	(2.8		)	(4.1		)
Other	—			—			—
Balance, September 27, 2014	$	6.7		$	—		$	6.7


(1)	Approximately $3.2 million and $0.6 million were recorded in the RCH and CAS segments, respectively, for the nine months of 2014.

Warehousing and Distribution Consolidation

In connection with the Company's efforts to optimize supply chain performance, the Company's Board of Directors have also approved entry into a five-year agreement with a third party logistics service provider to outsource certain warehousing and distribution activities in the Company's North American operating segments and facilitate the consolidation of North American warehousing distribution centers (the "Warehousing & Distribution Consolidation"). The Company expects these initiatives to generate cost savings as a result of moving to shared distribution centers and leveraging its scale by optimizing shipments and consolidating facilities.

The Company expects that the range of total cost to complete the Warehousing and Distribution Consolidation is as follows:



	Low ⁽¹⁾		High ⁽¹⁾
	(Dollar amounts in millions)
Employee-related costs	$	1.5	$	1.9
Other costs, including lease cancellation costs	2.0		2.2
	$	3.5	$	4.1


(1)	The range of total estimated exit and disposal activities by segment are as follows:



	Low		High
	(Dollar amounts in millions)
SCS	$	1.9	$	2.1
ERG	0.9		1.1
AVC	0.7		0.9
	$	3.5	$	4.1

The Company expects the Warehousing & Distribution Consolidation costs to be incurred through the fourth quarter of 2014. To date, the Company has incurred cumulative severance and other costs related to the Warehousing and Distribution Consolidation of approximately $2.7 million, of which approximately $1.7 million, $0.6 million, and $0.4 million were recorded in the SCS, ERG, and combined AVC segments, respectively.

The following table sets forth the changes to the liability for the Warehousing and Distribution Consolidation during the nine months of 2014:



	Severance			Other Costs			Total
	(Dollar amounts in millions)

Balance, December 31, 2013	$	0.7		$	0.3		$	1.0
Provision ⁽¹⁾	0.1			0.8			0.9
Payments	(0.8		)	(0.8		)	(1.6		)
Other	—			—			—
Balance, September 27, 2014	$	—		$	0.3		$	0.3


(1)	Approximately $0.5 million, $0.1 million, and $0.3 million were recorded in the SCS, ERG, and combined AVC segments, respectively, for the nine months of 2014.

Subsidiary Combinations

The Company has combined, or is in the process of combining, the operations of certain subsidiaries in order to improve overall operational efficiencies, reduce costs, and provide potential for greater revenue growth ("Subsidiary Combinations"). The total expected costs related to one time termination benefits and other costs associated with Subsidiary Combinations are estimated to be approximately $17.0 million to $17.5 million. Total expected costs by segment are as follows:



	Low		High
	(Dollar amounts in millions)
SCS	$	0.9	$	1.0
RCH	0.7		0.9
AVC	15.4		15.6
	$	17.0	$	17.5

In connection with Subsidiary Combinations, the Company has incurred cumulative costs of approximately $16.5 million, of which approximately $0.8 million, $0.5 million and $15.2 million was recorded in the SCS, RCH, and combined AVC segments, respectively. These costs consist of one time termination benefits of approximately $4.9 million, approximately $3.5 million in costs to reduce inventory values for certain products to their expected net realizable amount, and facility exit and other costs of approximately $8.1 million.

The following table sets forth the changes to the liability for Subsidiary Combinations during the nine months of 2014:



	Severance			Other Costs			Total
	(Dollar amounts in millions)

Balance, December 31, 2013	$	0.9		$	0.8		$	1.7
Provision ⁽¹⁾	1.4			1.8			3.2
Payments	(1.2		)	(1.3		)	(2.5		)
Other	(0.2		)	0.1			(0.1		)
Balance, September 27, 2014	$	0.9		$	1.4		$	2.3


(1)	Approximately $0.1 million, $0.5 million, and $2.6 million were recorded in the SCS, RCH, and combined AVC segments, respectively, for the nine months of 2014.

Best Restructuring

In 2011, management approved a plan to reduce costs and improve production efficiencies at Best, one of the Company's AQH subsidiaries, including transferring certain operations from Italy to Poland (the "Best Restructuring"). The total expected costs related to contractual termination benefits and other costs associated with the Best Restructuring are estimated to be approximately $17.3 million. In connection with the Best Restructuring, the Company has incurred cumulative costs through the nine months of 2014 of approximately $17.3 million, consisting of contractual termination benefits of approximately $16.9 million and other costs of approximately $0.4 million.

The following table sets forth the changes to the liability for the Best Restructuring during the nine months of 2014:



	Severance			Other Costs		Total
	(Dollar amounts in millions)

Balance, December 31, 2013	$	5.5		$	—	$	5.5
Provision	—			—		—
Payments	(5.3		)	—		(5.3		)
Other	(0.1		)	—		(0.1		)
Balance, September 27, 2014	$	0.1		$	—	$	0.1

Summary of Exit and Disposal Activities

The following table outlines amounts recorded within the unaudited condensed consolidated statement of operations associated with the Company's exit and disposal activities for the third quarter of 2014 and 2013:



	For the third quarter of 2014						For the third quarter of 2013
	SG&A		COGS		Total		SG&A		COGS		Total
	(Dollar amounts in millions)

Manufacturing Rationalization & Relocation Initiatives	$	—	$	1.1	$	1.1	$	—	$	0.4	$	0.4
Warehousing & Distribution Consolidation	—		—		—		—		0.3		0.3
Subsidiary Combinations	2.1		0.3		2.4		1.7		0.3		2.0
Total	$	2.1	$	1.4	$	3.5	$	1.7	$	1.0	$	2.7



	For the nine months of 2014						For the nine months of 2013
	SG&A		COGS		Total		SG&A		COGS		Total
	(Dollar amounts in millions)

Manufacturing Rationalization & Relocation Initiatives	$	—	$	3.8	$	3.8	$	—	$	7.2	$	7.2
Warehousing & Distribution Consolidation	0.3		0.6		0.9		—		0.3		0.3
Subsidiary Combinations	2.6		0.6		3.2		5.2		1.4		6.6
Total	$	2.9	$	5.0	$	7.9	$	5.2	$	8.9	$	14.1