Acquisition and Other Expense

6 Months Ended

Jun. 30, 2020

Acquisition and Other Expense [Abstract]

Acquisition and other expense consist of the following, which are included in cost of sales, selling and administrative expense or other expense depending on the nature of the charge:


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019


Plant underutilization costs	$	6,586	$	—	$	6,586	$	—
Product rationalization costs - inventory	2,169		—		2,169		—
Restructuring costs	1,087		—		1,087		—
Manufacturing consolidation costs	1,602		—		3,387		—
Acquisition and integration costs	652		503		1,457		1,163
Acquisition and other expense included in cost of sales	$	12,096	$	503	$	14,686	$	1,163


Restructuring costs	$	2,124	$	—	$	2,124	$	—
Product rationalization costs - field inventory	2,095		—		2,095		—
Acquisition and integration costs	439		2,461		1,192		9,706
Acquisition and other expense included in selling and administrative expense	$	4,658	$	2,461	$	5,411	$	9,706






Debt refinancing costs included in other expense	$	—	$	—	$	—	$	3,904

During the second quarter of 2020, we recorded a $6.6 million charge to cost of sales related to plant underutilization due to abnormally low production as a result of decreased sales caused by the COVID-19 pandemic.

During the second quarter of 2020, we performed an analysis of our product lines and determined certain catalog numbers, principally related to capital equipment, would be discontinued and consolidated into existing product offerings. We consequently recorded a $2.2 million charge to cost of sales to write-off inventory of the discontinued products. In addition, we

incurred $2.1 million in costs related to the write-off of field inventory used for customer demonstration and evaluation of the discontinued products which we charged to selling and administrative expense.

During the second quarter of 2020, we incurred $1.1 million in restructuring costs related to a voluntary separation arrangement with employees as a result of the COVID-19 pandemic that were charged to cost of sales based on the job function of the affected employees. We additionally recorded a charge of $2.1 million primarily related to the restructuring of our Orthopedic sales force and a voluntary separation arrangement with employees as a result of the COVID-19 pandemic that was charged to selling and administrative expenses based on the nature of the costs and function of the affected employees. Of the $3.2 million in these restructuring costs, $2.0 million is included in accrued compensation and benefits within the consolidated condensed balance sheet at June 30, 2020.

During the three and six months ended June 30, 2020, we incurred $1.6 million and $3.4 million, respectively, in costs related to the consolidation of certain manufacturing operations which were charged to cost of sales. These costs related to winding down operations at certain locations and moving production lines to other facilities.

During the three and six months ended June 30, 2020, we recognized costs for inventory step-up adjustments and other costs related to a previous acquisition of $0.7 million and $1.5 million, respectively. During the three and six months ended June 30, 2019, we incurred costs of $0.5 million and $1.2 million, respectively, for inventory adjustments associated with the acquisition of Buffalo Filter as further described in Note 3. These costs were charged to cost of sales.

During the three and six months ended June 30, 2020, we incurred $0.4 million and $1.2 million, respectively, in severance and integration costs mainly related to the Buffalo Filter acquisition. During the three and six months ended June 30, 2019, we incurred $2.5 million and $9.7 million, respectively, in costs associated with the acquisition of Buffalo Filter as further described in Note 3. These costs include investment banking fees in the first quarter of 2019, and, consulting fees, legal fees, severance and integration related costs in the three and six months ended June 30, 2019. These costs were included in selling and administrative expense.

During the six months ended June 30, 2019, we incurred a $3.6 million charge related to commitment fees paid to certain of our lenders, which provided a financing commitment for the Buffalo Filter acquisition and recorded a loss on the early extinguishment of debt of $0.3 million in conjunction with the sixth amended and restated senior credit agreement.

In conjunction with the consolidation of our manufacturing operations, our Buffalo, New York facility is currently held for sale and classified in prepaid expenses and other current assets in the consolidated condensed balance sheet. The net book value of this facility at June 30, 2020 was $3.0 million.