Special Charges, net

6 Months Ended

May 31, 2014

Note 6: Special Charges, net

The integration of the Forbo industrial adhesives business we acquired in March 2012 involves a significant amount of restructuring and capital investment to optimize the new combined entity. In addition, we are taking a series of actions in our existing EIMEA operating segment to improve the profitability and future growth prospects of this operating segment. We have combined these two initiatives into a single project which we refer to as the “Business Integration Project”. During the 13 weeks ended May 31, 2014 and June 1, 2013, we incurred special charges, net of $13,538 and $10,843, respectively and $25,272 and $16,176 for the 26 weeks ended May 31, 2014 and June 1, 2013, respectively for costs related to the Business Integration Project.

The following table provides detail of special charges, net:

		13 Weeks Ended				26 Weeks Ended
		May 31, 2014		June 1, 2013		May 31, 2014		June 1, 2013
Acquisition and transformation related costs		$	2,578	$	1,884	$	4,286	$	4,166
Workforce reduction costs			899		3,697		2,958		4,181
Facility exit costs			7,326		3,267		12,452		5,056
Other related costs			2,735		1,995		5,576		2,773
	Special charges, net	$	13,538	$	10,843	$	25,272	$	16,176

Acquisition and transformation related costs of $2,578 for the 13 weeks ended May 31, 2014 and $1,884 for the 13 weeks ended June 1, 2013 include costs related to organization consulting, financial advisory and legal services necessary to integrate the Forbo industrial adhesives business into our existing operating segments. For the 26 weeks ended May 31, 2014 and June 1, 2013 we incurred acquisition and transformation related costs of $4,286 and $4,166, respectively. During the 13 weeks ended May 31, 2014, we incurred workforce reduction costs of $899, cash facility exit costs of $5,708 and non-cash facility exit costs of $1,618 and other incremental transformation related costs of $2,735 including the cost of personnel directly working on the integration. During the 26 weeks ended May 31, 2014, we incurred workforce reduction costs of $2,958, cash facility exit costs of $9,282 and non-cash facility exit costs of $3,170 and other incremental transformation related costs of $5,576 including the cost of personnel directly working on the integration. During the 13 weeks and 26 weeks ended June 1, 2013, we incurred workforce reduction costs of $3,697 and 4,181, respectively, cash facility exit costs of $2,316 and $3,714, respectively, non-cash facility exit costs of $951 and $1,342, respectively and other incremental transformation related costs of $1,995 and $2,773, respectively including the cost of personnel directly working on the integration.

For the 26 weeks ended May 31, 2014, the activity in accrued compensation associated with the Business Integration Project, is as follows:

		Workforce Reduction Costs
Balance at November 30, 2013		$	18,057
	Workforce reduction costs		2,958
	Cash payments		(13,433)
	Foreign currency translation adjustment		(53)
Balance at May 31, 2014		$	7,529

Of the $7,529 in accrued workforce reduction costs at May 31, 2014, $6,654 was included in accrued compensation and $875 was included in other liabilities on our Condensed Consolidated Balance Sheets as this portion was not expected to be paid within the next year. The benefits were accrued based primarily on the formal severance plans in place for the various locations. The special charges are not allocated to our operating segments.