Exit Activity Costs

9 Months Ended

Sep. 30, 2020

Restructuring and Related Activities [Abstract]

Exit Activity Costs

(15) Restructuring and Exit Activity Costs

On August 5, 2020, we announced, in connection with the new strategic focus and organizational realignment, a restructuring plan intended to align our operating costs with current revenue levels and better position the Company for future sustainable and profitable growth. The restructuring plan includes a reduction of nearly 20% of our workforce, with the majority of the workforce reduction expected to be completed by December 31, 2020. We expect that the restructuring plan, in conjunction with other cost reduction measures, will reduce our annualized costs by approximately $100,000 by the end of December 31, 2021. Cost reduction efforts include reducing the number of facilities and examining every aspect of our manufacturing and operating costs. We will incur cash charges for severance, facility closing and other costs, primarily in the second half of this year. We may incur additional charges in 2021 as we finalize all the actions to be taken. Non-cash charges related to these actions are expected to be $7,600 and are included in facility closing costs. We are also evaluating the divestiture of parts of the business that do not align with this strategic focus. See Note 16.

In connection with the restructuring plan, we recorded pre-tax costs during the quarter and nine months ended September 30, 2020, included within Selling, general and administrative in the condensed consolidated income statement, and expect to incur total costs as follows:

	Total Costs Expected to be Incurred		Costs Incurred during quarter and nine months ended September 30, 2020
Severance, termination benefits and other employee costs	$	21,100	$	8,237
Facility closing costs	7,600		3,621
Other costs	3,700		—
Total	$	32,400	$	11,858

The liabilities at September 30, 2020 related to these costs were principally recorded in accrued expenses in the condensed consolidated balance sheets and were as follows:

	Liability at December 31, 2019		Costs Incurred during 2020		Costs Paid During 2020		Non-cash adjustments		Liability at September 30, 2020
Severance, termination benefits and other employee costs	$	—	$	8,237	$	(3,699)	$	—	$	4,538
Facility closing costs	—		3,621		—		(3,621)		—
Other costs	—		—		—		—		—
Total	$	—	$	11,858	$	(3,699)	$	(3,621)	$	4,538