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Restructuring and Other Charges | 9 Months Ended
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Jun. 29, 2019
Restructuring and Related Activities [Abstract] |
Restructuring and Other Charges | Restructuring and Other Charges Restructuring and other charges, net includes restructuring charges (credits) and headquarters relocation charges. For the nine months ended June 29, 2019 restructuring charges and other charges, net totaled $45.5 million, of which $43.0 million is attributable to workforce realignment and facility closures and $2.5 million is attributable to headquarters relocation charges. For the nine months ended June 30, 2018 restructuring charges totaled $1.8 million and include $1.0 million of credits attributable to a workforce realignment and facility closures, and $2.9 million is attributable to headquarters relocation charges. Restructuring Charges (Credits) In October 2018, we initiated a restructuring plan to realign our workforce to shift investment to support Industrial Internet of Things and Augmented Reality strategic high growth opportunities. As this was a realignment of resources rather than a cost-savings initiative, it did not result in significant cost savings. The restructuring plan was completed in the first quarter of 2019 and resulted in restructuring charges of $16 million for termination benefits associated with approximately 240 employees, substantially all of which has been paid. In January 2019, we relocated our worldwide headquarters to the Boston Seaport District. Our prior headquarters lease will not expire until November 2022, and we are seeking to sublease that space, but have not yet done so. As a result, we will bear overlapping rent obligations for those premises and, in the third quarter and first nine months of 2019, we recorded a restructuring charge of approximately $0.4 million and $27.1 million, respectively, based on the net present value of remaining lease commitments net of estimated sublease income. Restructuring charges and estimated cash outflows could increase if we are unable to sublease our prior headquarters as we expect. Other costs associated with the move were recorded as incurred. In the first nine months of 2019, we also recorded $0.1 million of credits related to prior facility restructuring actions. The following table summarizes restructuring accrual activity for the nine months ended June 29, 2019:
| Employee severance and related benefits |  | Facility closures and related costs |  | Total
| (in thousands)
October 1, 2018 | $ | — |  |  | $ | 2,415 |  |  | $ | 2,415 |
Charges to operations, net | 15,719 |  |  | 27,243 |  |  | 42,962 |
Cash disbursements | (15,397 | ) |  | (6,009 | ) |  | (21,406 | )
Non-cash reclass | — |  |  | 4,812 |  |  | 4,812 |
Foreign exchange impact | 6 |  |  | (18 | ) |  | (12 | )
Accrual, June 29, 2019 | $ | 328 |  |  | $ | 28,443 |  |  | $ | 28,771 |
The following table summarizes restructuring accrual activity for the nine months ended June 30, 2018:
| Employee severance and related benefits |  | Facility closures and related costs |  | Total
| (in thousands)
October 1, 2017 | $ | 1,736 |  |  | $ | 4,508 |  |  | $ | 6,244 |
Credits to operations, net | (509 | ) |  | (505 | ) |  | (1,014 | )
Cash disbursements | (1,247 | ) |  | (1,207 | ) |  | (2,454 | )
Foreign exchange impact | 20 |  |  | (80 | ) |  | (60 | )
Accrual, June 30, 2018 | $ | — |  |  | $ | 2,716 |  |  | $ | 2,716 |
Of the accrual for facility closures and related costs, as of June 29, 2019, $12.1 million is included in accrued expenses and other current liabilities and $16.3 million is included in other liabilities in the Consolidated Balance Sheets. The accrual for facility closures is net of assumed sublease income of $13.7 million. The accrual for employee severance and related benefits is included in accrued compensation and benefits in the Consolidated Balance Sheets. Of the accrual for facility closures and related costs, as of June 30, 2018, $1.6 million is included in accrued expenses and other current liabilities and $1.1 million is included in other liabilities in the Consolidated Balance Sheets. In determining the amount of the facilities accrual, we are required to estimate such factors as future vacancy rates, the time required to sublet properties and sublease rates. These estimates are reviewed quarterly based on known real estate market conditions and the credit-worthiness of subtenants and may result in revisions to established facility reserves. The accrual is based on the net present value of remaining lease commitments net of estimated sublease income. We had $28.4 million accrued as of June 29, 2019 related to excess facilities (compared to $2.4 million at September 30, 2018), representing discounted lease commitments with agreements expiring at various dates through 2023 of approximately $42.1 million, net of committed sublease income of approximately $1.4 million and uncommitted sublease income of approximately $12.3 million. Other - Headquarters Relocation Charges Headquarters relocation charges represent other expenses associated with exiting our Needham headquarters facility and relocating to our new worldwide headquarters in the Boston Seaport District. In the first nine months of 2019 and 2018 we recorded $1.9 million and $2.9 million, respectively, of accelerated depreciation expense related to shortening the estimated useful lives of leasehold improvements related to the Needham location. Headquarters relocation charges for the first nine months of 2019 also include $0.6 million of rental expense for the Needham facility that overlapped with rental expense for the new Seaport headquarters.

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- 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. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -URI http://asc.fasb.org/topic&trid=2175745 + Details
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