PROVISION FOR RESTRUCTURING

During September 2011, we initiated the Global Restructuring Plan focused on further reducing our overall operating expenses by including manufacturing and other cost reduction initiatives, such as consolidating certain manufacturing facilities and administrative functions to improve efficiencies. This plan was further expanded in the first quarter of 2012 and again during the second quarter of 2012 to include Project LEAN. The first phase of this plan was implemented in the third quarter of 2011 with the remaining phases of the plan, including final headcount terminations, expected to be substantially complete by the third quarter of 2014.

The expanded Global Restructuring Plan including Project LEAN and the SG&A Restructuring Plan will impact over 2,600 existing employees since inception. Total costs of the Global Restructuring Plan including Project LEAN and the SG&A Restructuring Plan are expected to approximate $78 million to $81 million by the end of the first quarter of 2014, with $60 million to $63 million in total anticipated costs for the Global Restructuring Plan and $18.0 million of costs incurred for the SG&A Restructuring Plan, which is substantially complete. During the fourth quarter of 2013, after additional cost savings reviews, we expanded some of the existing initiatives of Project LEAN, and therefore our total expected costs as well as the completion date for the plan were adjusted. Through our Global Restructuring Plan including Project LEAN, we plan to stabilize sales, actively manage margins, dramatically reduce operating expenses, more effectively manage working capital and improve global cash management control.

Restructuring expense for the years ended December 29, 2013, December 30, 2012, and December 25, 2011 were as follows:



(amounts in thousands)	December 29, 2013			December 30, 2012			December 25, 2011
				(As Restated)
Global Restructuring Plan (including LEAN)
Severance and other employee-related charges	$	7,421		$	16,945		$	11,115
Asset impairments	1,210			6,506			7,761
Other exit costs	2,389			5,084			519
SG&A Restructuring Plan
Severance and other employee-related charges	(222		)	(86		)	7,015
Asset impairments	—			—			72
Other exit costs	68			64			2,203
Manufacturing Restructuring Plan
Severance and other employee-related charges	—			—			(146		)
Other exit costs	—			(75		)	101
Total	$	10,866		$	28,438		$	28,640

Restructuring accrual activity for the years ended December 29, 2013, and December 30, 2012, were as follows:



(amounts in thousands)
Fiscal 2013	Accrual at Beginning of Year		Charged to Earnings		Charge Reversed to Earnings			Cash Payments			Exchange Rate Changes			Accrual at December 29, 2013
Global Restructuring Plan (including LEAN)
Severance and other employee-related charges⁽³⁾	$	7,752	$	9,799	$	(2,378	)	$	(7,469	)	$	197		$	7,901
Other exit costs⁽¹⁾	460		2,389		—			(2,763		)	(20		)	66
SG&A Restructuring Plan
Severance and other employee-related charges⁽³⁾	1,206		104		(326		)	(780		)	4			208
Other exit costs⁽²⁾	161		68		—			(228		)	(1		)	—
Total	$	9,579	$	12,360	$	(2,704	)	$	(11,240	)	$	180		$	8,175


⁽¹⁾	During 2013, there was a net charge to earnings of $2.4 million primarily due to lease termination costs, inventory and equipment moving costs, restructuring agent costs, legal cost, and gains/losses on sale of assets in connection with the restructuring plan.


⁽²⁾	During 2013, there was a net charge to earnings of $0.1 million primarily due to lease termination costs in connection with the restructuring plan.


⁽³⁾	During 2013, there was a severance charge reversed to earnings of $(2.7) million primarily due to eliminations of individuals from the plans, replacements of individuals in the plans with other individuals, resignations, and other final accrual adjustments. The eliminations and replacements were primarily the result of our change in management and strategic vision in 2013.



(amounts in thousands)
Fiscal 2012	Accrual at Beginning of Year		Charged to Earnings		Charge Reversed to Earnings			Cash Payments			Exchange Rate Changes			Accrual at December 30, 2012
			(As Restated)					(As Restated)
Global Restructuring Plan (including LEAN)
Severance and other employee-related charges⁽³⁾	$	9,710	$	21,558	$	(4,613	)	$	(19,044	)	$	141		$	7,752
Other exit costs⁽¹⁾	—		5,084		—			(4,616		)	(8		)	460
SG&A Restructuring Plan
Severance and other employee-related charges⁽³⁾	6,718		1,100		(1,186		)	(5,363		)	(63		)	1,206
Other exit costs⁽²⁾	1,109		64		—			(1,012		)	—			161
Manufacturing Restructuring Plan
Other exit costs	75		—		(75		)	—			—			—
Total	$	17,612	$	27,806	$	(5,874	)	$	(30,035	)	$	70		$	9,579


⁽¹⁾	During 2012, there was a net charge to earnings of $5.1 million primarily due to lease termination costs, inventory and equipment moving costs, restructuring agent costs, legal costs, pension settlements, and gains/losses on sale of assets in connection with the restructuring plan.


⁽²⁾	During 2012, there was a net charge to earnings of $0.1 million primarily due to lease termination costs and outplacement costs in connection with the restructuring plan.


⁽³⁾	During 2012, there was a severance charge reversed to earnings of $(5.8) million primarily due to eliminations of individuals from the plans, replacements of individuals in the plans with other individuals, resignations, and other final accrual adjustments. The eliminations and replacements were primarily the result of our change in management and strategic vision in 2012.

Global Restructuring Plan (including LEAN)

As of December 29, 2013, the net charge to earnings of $11.0 million represents the current year activity related to the Global Restructuring Plan including Project LEAN. The anticipated total costs related to the plan are expected to approximate $60 million to $63 million, of which $59.1 million have been incurred. The total number of employees planned to be affected by the Global Restructuring Plan including Project LEAN since inception is approximately 2,273, of which 2,139 have been terminated. Termination benefits are planned to be paid one month to 24 months after termination.

SG&A Restructuring Plan

During 2009, we initiated the SG&A Restructuring Plan focused on reducing our overall operating expenses by consolidating certain administrative functions to improve efficiencies. The first phase of this plan was implemented in the fourth quarter of 2009 with the remaining phases of the plan substantially completed by the end of the first quarter of 2012.

In the year ended December 29, 2013, the net charge reversed to earnings of $0.2 million represents the current year activity related to the SG&A Restructuring Plan. The implementation of the SG&A Restructuring Plan is substantially complete, with total costs incurred of approximately $18 million. The total number of employees affected by the SG&A Restructuring Plan was 369, all of which have been terminated. Termination benefits are planned to be paid one month to 24 months after termination.

Manufacturing Restructuring Plan

In August 2008, we announced a manufacturing and supply chain restructuring program designed to accelerate profitable growth in our Apparel Labeling Solutions (ALS) business, formerly Check-Net^®, and to support incremental improvements in our EAS systems and labels businesses.

The total number of employees affected by the Manufacturing Restructuring Plan was 420, all of which have been terminated. As of December 25, 2011, the implementation of the Manufacturing Restructuring Plan is substantially complete, with total costs incurred to date of $4.1 million.