5.	RESTRUCTURING AND OTHER SPECIAL CHARGES, NET

Acquisition and Integration Related Costs

On February 17, 2011, the Company entered into a Stock Purchase Agreement with ASG and ASG's stockholders, pursuant to which a subsidiary of the Company acquired all of the outstanding capital stock of ASG from the ASG stockholders on that date. During 2011, the Company incurred acquisition and integration related costs totaling $6.5 million ($4.5 million on an after-tax basis, or $0.11 per diluted share). Of the $6.5 million costs recorded during 2011, $4.0 million was recorded in the Other segment and $2.5 million was reflected within the Wholesale Operations segment. In 2011, $2.9 million of the ASG acquisition and integration costs related to severance, for which there is a remaining reserve balance of $1.7 million at January 28, 2012. During 2010, the Company incurred acquisition-related costs totaling $1.1 million ($0.7 million on an after-tax basis, or $0.02 per diluted share) to effect the acquisition of ASG. All of the costs incurred in 2010 were reflected within the Other segment. All of the expenses incurred in 2011 and 2010 were recorded as a component of restructuring and other special charges, net. See Note 2 to the consolidated financial statements for further information.

Portfolio Realignment

In 2011, portfolio realignment efforts began that were designed to make the Company somewhat smaller but stronger and more profitable in the future. The first phase of the portfolio realignment includes selling the AND 1 division (TBMC, which was acquired with ASG); closing two U.S. distribution centers and a factory in China; exiting certain women's specialty and private label brands; exiting the children's wholesale business; closing or relocating numerous underperforming or poorly aligned retail stores and other infrastructure changes. These efforts began in 2011 and will continue in 2012.

In conjunction with the sale of TBMC, the Company recorded a gain of $20.6 million ($14.0 million on an after-tax basis, or $0.32 per diluted share), which is reflected in the consolidated statements of earnings as a component of discontinued operations. The Company incurred costs related to these portfolio realignment activities of $19.2 million ($12.0 million on an after-tax basis, or $0.28 per diluted share). These costs are reflected on the consolidated statements of earnings as $17.2 million in restructuring and other special charges, net and $2.0 million in costs of goods sold. Of the $17.2 million, $10.5 million was recorded in the Wholesale Operations segment, $3.3 million was recorded in the Other segment, $2.8 million was recorded in the Famous Footwear segment and $0.6 million was recorded in the Specialty Retail segment. Of the $2.0 million, $1.6 million was recorded in the Wholesale Operations segment and $0.4 million was recorded in the Specialty Retail segment.

The Company believes the first phase of the portfolio realignment will result in expense of approximately $31 to $34 million, of which $19.2 million was recognized during 2011. The Company expects approximately half of the $31 to $34 million of expense will relate to severance and other employee-related costs.

The following is a summary of the charges and settlements by category of costs:


($ millions)	Employee			Markdowns and Royalty Shortfalls			Facility			Other			Total
Original charges and reserve balance	$	8.9		$	6.1		$	1.4		$	2.8		$	19.2
Amounts settled in 2011		(3.1	)		(4.5	)		(0.1	)		(1.5	)		(9.2	)
Reserve balance at January 28, 2012	$	5.8		$	1.6		$	1.3		$	1.3		$	10.0

Information Technology Initiatives

During 2008, the Company began implementation of an integrated enterprise resource planning ("ERP") system provided by third-party vendors. The ERP system replaced certain existing internally developed and certain other third-party applications. Although the Company went live on the wholesale portion of its new ERP system in the fourth quarter of 2010, system transition efforts and alignment of existing business processes continued into 2011.

During 2010, the Company incurred expenses of $6.8 million ($4.6 million on an after-tax basis, or $0.10 per diluted share) related to these initiatives. Of the $6.8 million in expenses recorded during 2010, $6.1 million was recorded in the Other segment, and the remaining expense was recorded in the Wholesale Operations segment. During 2009, the Company incurred expenses of $9.2 million ($5.8 million on an after-tax basis, or $0.14 per diluted share) related to these initiatives. Of the $9.2 million in expenses recorded during 2009, $8.9 million was recorded in the Other segment, and the remaining expense was recorded in the Wholesale Operations segment. All expenses incurred were recorded as a component of restructuring and other special charges, net.

Organizational Changes

The Company made a series of changes within its leadership team in 2009 after two executives announced plans to retire in 2010. During 2009, the Company incurred charges of $4.6 million ($2.8 million on an after-tax basis, or $0.07 per diluted share) related to their retirement. All of these costs were reflected within the Other segment as a component of restructuring and other special charges, net.

Headquarters Consolidation

During 2008, the Company relocated its Famous Footwear division headquarters from Madison, Wisconsin to St. Louis, Missouri to foster collaboration, increase the Company's speed to market and strengthen its connection with consumers. During 2009, the Company recorded income of $1.9 million ($1.1 million on an after-tax basis, or $0.03 per diluted share) as a result of an expanded sublease arrangement. The Company incurred no additional charges or income related to this initiative during 2011 or 2010.

The following is a summary of the charges and settlements by category of costs:


($ millions)	Employee Severance			Employee Relocation			Employee Recruiting			Facility			Other			Total
Original charges and reserve balance	$	6.6		$	8.3		$	4.6		$	9.2		$	1.1		$	29.8
Amounts settled in 2008		(4.7	)		(6.2	)		(4.3	)		(3.6	)		(1.0	)		(19.8	)
Reserve reduction in 2009		–			–			–			(1.9	)		–			(1.9	)
Amounts settled in 2009		(1.9	)		(1.7	)		(0.2	)		(1.9	)		(0.1	)		(5.8	)
Reserve balance at January 30, 2010	$	–		$	0.4		$	0.1		$	1.8		$	–		$	2.3
Amounts settled in 2010		–			(0.4	)		(0.1	)		(1.4	)		–			(1.9	)
Reserve balance at January 29, 2011	$	–		$	–		$	–		$	0.4		$	–		$	0.4
Amounts settled in 2011		–			–			–			(0.4	)		–			(0.4	)
Reserve balance at January 28, 2012	$	–		$	–		$	–		$	–		$	–		$	–

Expense and Capital Containment Initiatives

During 2008, the Company announced expense and capital containment initiatives in an effort to proactively position itself for continued challenges in the retail environment. These initiatives included a voluntary separation program, changes in compensation structure, further rationalization of operating expenses and the closing of certain functions at the Company's Fredericktown, Missouri distribution center. The Company incurred no charges during 2011, 2010 or 2009.

The following is a summary of the charges and settlements by category of costs:


($ millions)	Employee Severance			Facility			Other			Total
Original charges and reserve balance	$	24.7		$	6.0		$	0.2		$	30.9
Amounts settled in 2008		(5.3	)		(2.7	)		–			(8.0	)
Amounts settled in 2009		(15.3	)		(2.1	)		(0.2	)		(17.6	)
Reserve balance at January 30, 2010	$	4.1		$	1.2		$	–		$	5.3
Amounts settled in 2010		(3.3	)		(1.2	)		–			(4.5	)
Reserve balance at January 29, 2011	$	0.8		$	–		$	–		$	0.8
Amounts settled in 2011		(0.8	)		–			–			(0.8	)
Reserve balance at January 28, 2012	$	–		$	–		$	–		$	–