Note 6 - Restructuring

3 Months Ended

Mar. 28, 2020

Notes to Financial Statements

Restructuring and Related Activities Disclosure [Text Block]

In March 2020, our management approved and executed an internal restructuring plan (the “Q1 2020 Plan”), which included a workforce reduction in order to reduce our operating cost structure by leveraging our low-cost regions as well as enhancing efficiency. Approximately $1.1 million of restructuring expense has been incurred through March 28, 2020 under the Q1 2020 Plan, and we believe this amount approximates the total costs under the plan.

Under the Q2 2019 Sales Plan, which is more fully described in the 2019 10-K, we recorded a credit adjustment of approximately $0.2 million during the first quarter of fiscal 2020 due to the final reconciliation of expenses incurred, and we incurred approximately $2.0 million of restructuring expense during fiscal 2019. Approximately $1.8 million of net expense has been incurred through  March 28, 2020 under the Q2 2019 Sales Plan. All actions planned under the Q2 2019 Sales Plan have been implemented.

Under the June 2017 Plan, which is more fully described in the 2019 10-K, we incurred less than $0.1 million and approximately $1.3 million of expense during the first quarter of fiscal 2020 and fiscal 2019, respectively. We have incurred approximately $19.1 million of total expense through March 28, 2020 under the June 2017 Plan, and all planned actions have been implemented. We expect the total cost of the June 2017 Plan to be approximately $20.0 million to $21.5 million as expenses related to our partially vacated facility in San Jose, California will be incurred over the remaining lease term.

These expenses were recorded to Restructuring charges on our Consolidated Statements of Operations. The restructuring accrual balance is presented in Accounts payable and accrued expenses and in Other long-term liabilities on our Consolidated Balance Sheets. The following table displays the activity related to our restructuring plans:

(In thousands)	Severance & Related (1)			Lease Termination & Fixed Assets			Software Contracts & Engineering Tools (2)			Other (3)			Total
Accrued Restructuring at December 28, 2019	$	160		$	6,585		$	—		$	865		$	7,610
Restructuring charges		949			47			—			(56	)		940
Costs paid or otherwise settled		(135	)		(405	)		—			(201	)		(741	)
Accrued Restructuring at March 28, 2020	$	974		$	6,227		$	—		$	608		$	7,809
Accrued Restructuring at December 29, 2018	$	1,814		$	8,630		$	218		$	18		$	10,680
Restructuring charges		(60	)		1,409			—			(8	)		1,341
Costs paid or otherwise settled		(1,540	)		(1,875	)		(83	)		(10	)		(3,508	)
Accrued Restructuring at March 30, 2019	$	214		$	8,164		$	135		$	—		$	8,513

(1)	Includes employee relocation and outplacement costs
(2)	Includes cancellation of contracts, asset impairments, and accelerated depreciation on certain enterprise resource planning and customer relationship management systems
(3)	Beginning in the second quarter of fiscal 2019, "Other" included termination fees on the cancellation of certain contracts under the Q2 2019 Sales Plan