Other Charges

2018 Cost Savings Initiatives. During the year ended December 31, 2018, we began execution of multiple cost savings initiatives, including reductions in overhead and supply chain, resulting in pre-tax charges of $13.1 million in severance and other payroll-related costs, $6.8 million in contract termination fees, $2.3 million in other miscellaneous shutdown costs, $3.4 million in lease obligation costs, $1.9 million in legal and advisory fees, $1.9 million related to the write-down of capitalized software, and $1.0 million in disposal of fixed assets.

Store Consolidation Plan. During the year ended December 31, 2018, we closed 138 Core U.S. stores and 9 locations in Mexico, resulting in pre-tax charges of $11.2 million, consisting of $8.1 million in lease obligation costs, $1.6 million in disposal of fixed assets, $1.3 million in other miscellaneous shutdown costs, and $0.2 million in severance and other payroll-related cost.

Write-down of Capitalized Software. During 2018 and 2017, we discontinued certain IT software projects and as a result incurred pre-tax charges of $1.2 million and $18.2 million, respectively, related to the write-down of capitalized assets and termination of associated license agreements.

Effects of Hurricanes. During the second half of 2018, Hurricane Florence and Michael caused damage in North Carolina, South Carolina, and Florida resulting in pre-tax expenses of approximately $0.6 million for inventory losses, store repair costs, fixed asset write-offs, and employee assistance. During the third quarter of 2017, Hurricanes Harvey, Irma and Maria caused significant damage in the continental United States and surrounding areas, including Texas, Florida, and Puerto Rico, resulting in pre-tax expenses of approximately $4.5 million for inventory losses, store repair costs, fixed asset write-offs, and employee assistance. Approximately $2.1 million of these pre-tax expenses related to Hurricanes Harvey and Irma, while the remaining $2.4 million related to Hurricane Maria.

Acceptance Now Store Closures. During the first six months of 2017, we closed 319 Acceptance Now manned locations and 9 Acceptance Now direct locations, related to the hhgregg bankruptcy and liquidation plan and the Conn's referral contract termination. These closures resulted in pre-tax charges of $19.2 million for the year ended December 31, 2017, consisting primarily of rental merchandise losses, disposal of fixed assets, and other miscellaneous labor and shutdown costs. In addition, we recorded a pre-tax impairment charge of $3.9 million to our intangible assets for our discontinued vendor relationship.

Corporate Cost Rationalization. During the first nine months of 2017, we executed a head count reduction that impacted approximately 10% of our field support center workforce. This resulted in pre-tax charges for severance and other payroll-related costs of approximately $3.4 million for the year ended December 31, 2017.

Core U.S. Store and Acceptance Now Consolidation Plan. During the second quarter of 2016, we closed 167 Core U.S. stores and 96 Acceptance Now locations, resulting in pre-tax charges of $20.1 million consisting of lease obligation costs, disposal of fixed assets, and other miscellaneous shutdown costs.

Mexico Store Consolidation Plan. During the first quarter of 2016, we closed 14 stores in Mexico, resulting in pre-tax charges of $2.3 million in the Mexico segment for disposal of rental merchandise, disposal of fixed assets and leasehold improvements, and other miscellaneous shutdown costs.

Claims Settlement. In the fourth quarter of 2016, we recognized a gain of $2.2 million related to a legal claims settlement.

Activity with respect to other charges for the years ended December 31, 2017 and 2018 is summarized in the below table:



(In thousands)	Accrued Charges at December 31, 2016		Charges & Adjustments		Payments			Accrued Charges at December 31, 2017		Charges & Adjustments		Payments			Accrued Charges at December 31, 2018
Cash charges:
Labor reduction costs	$	1,393	$	3,765	$	(3,484	)	$	1,674	$	13,321	$	(7,372	)	$	7,623
Lease obligation costs	6,628		457		(4,980		)	2,105		11,952		(9,175		)	4,882
Contract termination costs	—		—		—			—		6,750		(6,750		)	—
Other miscellaneous	—		723		(723		)	—		2,696		(2,696		)	—
Total cash charges	$	8,021	4,945		$	(9,187	)	$	3,779	34,719		$	(25,993	)	$	12,505
Non-cash charges:
Rental merchandise losses			18,417							620
Asset impairments, including capitalized software			19,237							6,825
Impairment of intangible asset			3,896							—
Other⁽¹⁾			12,724							17,160
Total other charges			$	59,219						$	59,324

⁽¹⁾ Other primarily includes incremental legal and advisory fees associated with our strategic review and merger related activities, partially offset by insurance claims recoveries related to 2017 hurricanes for the year ended December 31, 2018 and primarily includes incremental legal and advisory fees, effects of hurricanes, and legal settlements for the year ended December 31, 2017.