Restructuring

2014 Restructuring

During the third quarter of fiscal year 2014, our management approved, committed to and initiated plans to make strategic changes to our organization to provide greater focus and agility in the delivery of next generation application development, deployment and integration solutions. Effective September 1, 2014, we began to operate as three distinct business units: OpenEdge, Data Connectivity and Integration, and Application Development and Deployment, each with dedicated sales, product management and product marketing functions. In connection with the new organizational structure, we no longer have a global head of sales, as well as certain other positions within the sales and administrative organizations. The organizational changes will not result in the closing of any of our facilities.

As part of the 2014 restructuring, for the twelve months ended November 30, 2014, we incurred expenses of $1.7 million, which are related to employee costs, including severance, health benefits, and outplacement services, but excluding stock-based compensation. The expenses are recorded as restructuring expenses in the consolidated statements of income. We do not expect to incur additional material costs with respect to the 2014 restructuring.

A summary of activity for the 2014 restructuring action is as follows (in thousands):



	Excess Facilities and Other Costs		Employee Severance and Related Benefits			Total
Balance, December 1, 2013	$	—	$	—		$	—
Costs incurred	—		1,664			1,664
Cash disbursements	—		(437		)	(437		)
Balance, November 30, 2014	$	—	$	1,227		$	1,227

Cash disbursements for expenses incurred to date under the 2014 restructuring are expected to be made during fiscal year 2015. As a result, the $1.2 million is included in other accrued liabilities on the consolidated balance sheet at November 30, 2014.

2013 Restructuring

During the third quarter of fiscal year 2013, our management approved, committed to and initiated plans to restructure and improve efficiencies in our operations as a result of the sale of the Apama product line and the divestitures completed during the fourth quarter of fiscal year 2012 and the first quarter of fiscal year 2013. We reduced our global workforce primarily within the administrative and sales organizations. This workforce reduction was conducted across all geographies and also resulted in the closing of certain facilities.

Restructuring expenses relate to employee costs, including severance, health benefits, outplacement services and transition divestiture arrangements, but excluding stock-based compensation, and facilities costs, which include fees to terminate lease agreements and costs for unused space, net of sublease assumptions. Other costs include costs to terminate automobile leases of employees included in the workforce reduction, asset impairment charges for assets no longer deployed as part of cost reduction strategies, costs for unused software licenses as part of the workforce reduction and other costs directly associated with the restructuring actions taken.

As part of the 2013 restructuring, we incurred $0.4 million of expenses in the fiscal year 2014. The expenses are recorded as restructuring expenses in the consolidated statements of income. We do not expect to incur additional material costs with respect to the 2013 restructuring.

A summary of the fiscal year 2014 activity for the 2013 restructuring action is as follows (in thousands):



	Excess Facilities and Other Costs			Employee Severance and Related Benefits			Total
Balance, December 1, 2013	$	569		$	1,077		$	1,646
Costs incurred	329			67			396
Cash disbursements	(666		)	(1,146		)	(1,812		)
Translation adjustments and other	(5		)	2			(3		)
Balance, November 30, 2014	$	227		$	—		$	227

A summary of the fiscal year 2013 activity for the 2013 restructuring action is as follows (in thousands):



	Excess Facilities and Other Costs			Employee Severance and Related Benefits			Total
Balance, December 1, 2012	$	—		$	—		$	—
Costs incurred	1,126			7,594			8,720
Cash disbursements	(510		)	(6,577		)	(7,087		)
Translation adjustments and other	(47		)	60			13
Balance, November 30, 2013	$	569		$	1,077		$	1,646

Cash disbursements under the 2013 restructuring are expected to be made through fiscal year 2017. The short-term portion of the restructuring reserve of $0.1 million is included in other accrued liabilities and the long-term portion of $0.1 million is included in other noncurrent liabilities on the consolidated balance sheet at November 30, 2014.

2012 Restructuring

In the second quarter of fiscal 2012, as part of the Plan, our management approved, committed to and initiated certain operational restructuring initiatives to reduce annual costs, including the simplification of our organizational structure and the consolidation of facilities. In addition, as part of the Plan, we divested our non-Core product lines. Our restructuring actions include both our cost reduction efforts and qualifying costs associated with our divestitures.

As part of the 2012 restructuring, we incurred $0.2 million of expenses in the fiscal year 2014. The expenses are recorded as restructuring expenses in the consolidated statements of income. We do not expect to incur additional material costs for the 2012 restructuring.

A summary of the fiscal year 2014 activity for the 2012 restructuring actions is as follows (in thousands):



	Excess Facilities and Other Costs			Employee Severance and Related Benefits			Total
Balance, December 1, 2013	$	615		$	291		$	906
Costs incurred	250			(16		)	234
Cash disbursements	(650		)	(276		)	(926		)
Translation adjustments and other	(26		)	1			(25		)
Balance, November 30, 2014	$	189		$	—		$	189

A summary of the fiscal year 2013 activity for the 2012 restructuring actions is as follows (in thousands):



	Excess Facilities and Other Costs			Employee Severance and Related Benefits			Total
Balance, December 1, 2012	$	603		$	6,429		$	7,032
Costs incurred	1,545			2,752			4,297
Cash disbursements	(1,423		)	(8,941		)	(10,364		)
Asset impairment	(111		)	—			(111		)
Translation adjustments and other	1			51			52
Balance, November 30, 2013	$	615		$	291		$	906

Cash disbursements under the 2012 restructuring are expected to be made through fiscal year 2015. As a result, the $0.2 million is included in other accrued liabilities on the condensed consolidated balance sheet at November 30, 2014.