RESTRUCTURING CHARGES

12 Months Ended

Dec. 31, 2012

RESTRUCTURING CHARGES

In December 2011, our management approved and initiated a cost reduction plan ("2011 Restructuring Plan") as part of our broader cost reduction initiatives. During 2012, we completed the first three phases of our cost reduction plan, which included the consolidation of our manufacturing and research and development facilities, moving a portion of our outsourced spare parts logistics operations in-house, and workforce reductions. In January 2013, we finalized our plans for the fourth phase of the cost reduction plan. The fourth phase of our cost reduction plan broadens our workforce reductions across all areas of the Company and is expected to be completed by the end of the first quarter in 2013.

As of December 2012, we have incurred $6.9 million in restructuring charges under the 2011 Restructuring Plan, of which $5.1 million was recorded during 2012. We expect to incur an additional $2.0 million to $3.0 million related to the 2011 Restructuring Plan, of which we expect the majority of the charges to be incurred during the first quarter of 2013.

During the year ended December 31, 2012, we recorded $4.7 million of employee severance and other expenses and $0.4 million contract termination costs. In 2012, we paid $2.7 million in employee severance and other expenses and $1.4 million in contract termination costs related to the 2011 Restructuring Plan.

The following table summarizes changes in our restructuring accrual for the years ended December 31, 2012 and 2011 (in thousands):



	Employee Severance Costs			Contract Termination Costs			Other Costs (1)			Total
Balance at December 31, 2010	$	94		$	1,206		$	—		$	1,300
Expensed	452			1,437			—			1,889
Payments	(370		)	(76		)	—			(446		)
Reserve adjustments	(94		)	$	94		—			—
Balance at December 31, 2011	82			2,661			—			2,743
Expensed	4,011			355			704			5,070
Payments	(2,190		)	(1,420		)	(474		)	(4,084		)
Long-lived assets write-off	—			—			(230		)	(230		)
Reserve adjustments	102			4			—			106
Balance at December 31, 2012	$	2,005		$	1,600		$	—		$	3,605

(1) Other costs include a $0.2 million charge related to impairments of property and equipment resulting from the transfer of our research, development and prototype production of the Millios system to our facility in Dornstadt, Germany and the consolidation of global manufacturing in our facility in Fremont, California.

The restructuring accrual of $3.6 million as of December 31, 2012, is comprised of $2.0 million related to accrued employee severance costs and $1.6 million of contract termination costs related to future rent obligations associated with three vacated leased facilities net of sublease income.

As of December 31, 2012, $3.4 million of the restructuring accrual was classified as short-term and recorded within other current liabilities in the consolidated balance sheets, and the remaining $0.2 million of the restructuring accrual was classified as long-term and recorded within other long-term liabilities in the consolidated balance sheets.

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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