5. Restructuring

In March 2011, the Company announced the acceleration of its store rationalization plan, a program designed to increase the productivity of the Company’s store square footage by evaluating the Company’s store portfolio on a market-by-market basis and closing, consolidating or downsizing certain selected locations. This evaluation includes consideration of factors such as overall size of each market, current performance and growth potential of each store and available lease expirations, lease renewals and other lease termination opportunities. As a result of this evaluation, the Company identified approximately 110 locations, including full stores and attached store concepts, for closure, including 15 to 20 locations as consolidation or downsizing opportunities. The Company has adopted a staged approach to closing, consolidating and downsizing these locations to best match its existing lease opportunities with the majority of the locations expected to close in fiscal 2011 and the remaining locations expected to close throughout fiscal 2012 and into fiscal 2013. The scope and timing of closures, consolidations and downsizings under this plan remains dynamic as the Company continues to perform ongoing evaluations of its portfolio and continues the process of negotiating acceptable termination arrangements with associated third parties. The Company expects to record total non-recurring restructuring charges of approximately $14.0 million related to this plan. In the thirteen and thirty-nine weeks ended October 29, 2011, the Company incurred restructuring charges of $4.3 million and $7.5 million, respectively, primarily comprised of lease exit, severance and related costs for certain locations closed or to be closed under this plan and, through October 29, 2011, closed 35 locations, including 31 full stores.

In the thirty-nine weeks ended October 30, 2010, the Company recorded $5.3 million of restructuring charges primarily related to the consolidation of the Company’s Madison Avenue, New York flagship location in which the Company reduced active leased floor space and wrote down certain assets and leasehold improvements no longer used in the redesigned lay-out.

The following is a summary of the activity and liability balances related to restructuring for the thirty-nine weeks ended October 29, 2011 and October 30, 2010:


	Corporate - Wide
	Strategic Initiatives
				Lease -
	Severance			Related			Total
	(In thousands)
Balance at January 29, 2011	$	215		$	3,781		$	3,996
Charges		2,545			4,977			7,522
Cash payments		(1,091	)		(2,624	)		(3,715	)
Non-cash items		62			—			62

Balance at October 29, 2011	$	1,731		$	6,134		$	7,865


	Corporate - Wide
	Strategic Initiatives
				Lease -
	Severance			Related			Total
	(In thousands)
Balance at January 30, 2010	$	3,089		$	784		$	3,873
Charges		1,164			4,152			5,316
Cash payments		(3,605	)		(846	)		(4,451	)
Non-cash items		26			(44	)		(18	)

Balance at October 30, 2010	$	674		$	4,046		$	4,720

The non-cash items primarily consist of changes to stock-based compensation expense related to terminated employees and the write-off of certain leasehold improvements and lease liability adjustments. Of the $7.9 million in restructuring liabilities at October 29, 2011, $5.5 million, expected to be paid within the next twelve months, is included in accrued liabilities and accounts payable and the remaining $2.4 million, expected to be paid thereafter through 2014, is included in deferred rent under lease commitments.