Restructuring

3 Months Ended

Mar. 31, 2021

Restructuring and Related Activities [Abstract]

Restructuring and Impairment

During both 2020 and 2019, we engaged a strategic consulting firm to assist us in optimizing our structure and cost base. As a result, we have implemented several cost-saving and margin improvement programs designed to generate substantial incremental cash flow including the Operation, Simplification and Optimization Program, the DRG Acquisition Integration Program and the CPA Global Acquisition, Integration and Optimization Program.

Operation Simplification and Optimization Program

During the fourth quarter of 2019, the Company approved restructuring actions designed to streamline our operations by simplifying our organization and focusing on two segments in planned phases. The following table summarizes the activity related to the restructuring reserves for the Operation, Simplification and Optimization Program:








Operation Simplification and Optimization Program	Severance and Related Benefit Costs		Costs Associated with Exit and Disposal Costs (1)		Total
Reserve Balance as of December 31, 2019	$	9,506	$	—	$	9,506
Expenses recorded	6,574		1,180		7,754
Payments made	(6,647)		—		(6,647)
Reserve Balance as of March 31, 2020	$	9,433	$	1,180	$	10,613

Reserve Balance as of December 31, 2020	$	5,368	$	593	$	5,961
Expenses recorded	252		177		429
Payments made	(4,716)		(751)		(5,467)
Reserve Balance as of March 31, 2021	$	904	$	19	$	923
(1) Relates primary to lease exit costs and legal and advisory fees.

Restructuring charges included actions to reduce operational costs. Components of the pre-tax charges include $252 and $6,574 in severance costs and $177 and $1,180 in other costs incurred during the three months ended March 31, 2021 and 2020, respectively. The Science and IP segments incurred $3,908 and $3,847 of the expense, respectively, during the three months ended March 31, 2020.

The following table is a summary of charges incurred related to the Operation, Simplification and Optimization Program for the three months ended March 31, 2021 and 2020.


	Three Months Ended March 31,
	2021		2020
Severance and related benefit costs	$	252	$	6,574
Costs associated with exit and disposal activities (1)	49		1,180
Costs associated with lease exit costs including impairment (2)	128		—
Total	$	429	$	7,754
(1) Relates primarily to contract exit costs, legal and advisory fees.
(2) Relates primary to lease exit costs.

The Science and IP segments incurred $157 and $272 of the expense, respectively, during the three months ended March 31, 2021. The Company does not expect to incur any material expenses after March 31, 2021 with these restructuring efforts.

DRG Acquisition Integration Program

During the second quarter of 2020, the Company approved restructuring actions designed to eliminate duplicative costs following the acquisition of DRG in planned phases. The following table summarizes the activity related to the restructuring reserves for the DRG Acquisition Integration during the three months ended March 31, 2021:


DRG Acquisition Integration	Severance and Related Benefit Costs		Costs Associated with Exit and Disposal Costs (1)		Total
Reserve Balance as of December 31, 2020	$	741	$	240	$	981
Expenses recorded	192		75		267
Payments made	(439)		(99)		(538)
Noncash items and other adjustments	—		—		—
Reserve Balance as of March 31, 2021	$	494	$	216	$	710
(1) Relates primary to lease exit costs.

The following table is a summary of charges incurred related to the DRG Acquisition Integration in the three months ended March 31, 2021:


	Three months ended March 31, 2021
Severance and related benefit costs	$	192
Costs associated with exit and disposal activities	—
Costs associated with lease exit costs including impairment (1)	75
Total	$	267
(1) Relates primarily to lease exit costs.

The Science and IP segments incurred $95 and $172 of the expense, respectively, during the three months ended March 31, 2021. The Company does not expect to incur any material expenses after March 31, 2021 with these restructuring efforts.

CPA Global Acquisition Integration and Optimization Program

During the fourth quarter of 2020, the Company approved restructuring actions designed to eliminate duplicative costs following the acquisition of CPA Global and to streamline our operations simplifying our organization and reducing our leasing portfolio. The following table summarizes the activity related to the restructuring reserves for the CPA Global Acquisition, Integration and Optimization Program:








CPA Global Acquisition Integration and Optimization Program	Severance and Related Benefit Costs (As Restated)		Costs Associated with Exit and Disposal Costs (1)		Total (As Restated)
Reserve Balance as of December 31, 2020	$	19,603	$	3,642	$	23,245
Expenses recorded(2)	21,792		45,301		67,093
Payments made	(10,771)		(261)		(11,032)
Noncash items and other adjustments(3)	(1,409)		(40,806)		(42,215)
Reserve Balance as of March 31, 2021	$	29,215	$	7,876	$	37,091
(1) Relates primary to lease exit costs and legal and advisory fees.
(2) Expenses include the acceleration of phantom equity awards under the CPA Global Equity Plan that were held by employees whose employment was involuntarily terminated. These expenses will be paid in cash and are accounted for as a liability award. See note 2 - Basis of Presentation for further details.
(3) Includes a $1,409 bonus accrual for severed employees and $40,806 of lease impairment charges.

The following table is a summary of charges incurred related to the CPA Global Acquisition Integration in the three months ended March 31, 2021.


	Three months ended March 31, 2021 (As Restated)
Severance and related benefit costs(1)	$	21,792
Costs associated with exit and disposal activities(2)	287
Costs associated with lease exit costs including impairment(3)	45,014
Total	$	67,093
(1) Expenses include the acceleration of phantom equity awards under the CPA Global Equity Plan that were held by employees whose employment was involuntarily terminated. These expenses will be paid in cash and are accounted for as a liability award. See note 2 - Basis of Presentation for further details.
(2) Relates primary to legal and advisory fees.
(3) Includes $40,806 of charges related to impairment of leases, and $4,208 of costs incurred from exiting leases.

The Science and IP segments incurred $22,388 and $40,435 of the expense, respectively, during the three months ended March 31, 2021. The Company expects to incur $42,765 of expense after March 31, 2021 with these restructuring efforts expected to conclude in 2022.