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Restructuring Charges and Asset Disposals
 12 Months Ended
Dec. 31, 2011
Restructuring Charges and Asset Disposals [Abstract]  
Restructuring Charges and Asset Disposals

Note 20. Restructuring Charges and Asset Disposals

The Company recorded restructuring charges and asset disposals of $3.0 million for the twelve months ended December 31, 2011. These costs are included in restructuring charges and asset disposals expense in the Consolidated Statements of Operations.

During 2011, the Company announced that it would be undertaking a series of initiatives that are designed to transform and enhance its operations. In order to strengthen the Company’s competitive position and return it to its goal of restored health and profitability, it executed one initiative to consolidate four branch locations and vacate other office space, and a second plan to reduce workforce by approximately 10% of employees.

On March 3, 2011, the Company announced that it would consolidate four branches, effective June 2011, to reduce operating expenses. All customer accounts in the affected branches were transferred to nearby Patriot branches to minimize any inconvenience to customers. The consolidation of these branches resulted in an earnings charge of $1.8 million, which is comprised of lease termination expenses of $1.2 million, lease liabilities charges of $400,000, and severance payments of $200,000 to affected employees. In addition, there was a $600,000 write-off of leasehold improvements and other fixed assets for these branches that were closed.

In order to further reduce operating expenses, the Company announced on May 16, 2011 that it would be executing a workforce reduction plan with employees in the back office operational areas. There were a total of eighteen employees affected by this reduction. This initiative resulted in an earnings charge of $600,000, which is comprised exclusively of severance payments to affected employees.

On September 23, 2011, the Company subleased vacant office space at 900 Bedford Street, Stamford, CT, effective October 1, 2011 for a term of two years.

 

Restructuring reserves at December 31, 2011 for the restructuring activities taken in connection with these initiatives are comprised of the following:

 

                                 
    Expenses     Cash
payments		     Non-cash
charges		     December 31,
2011		  

Severance and benefit costs

   $ 756,727     $ (674,675 )    $ (17,920 )    $ 64,132  

Lease termination costs

     1,659,995       (1,279,034 )      (63,153 )      317,808  

Asset disposals

     569,719       —         (569,719 )      —    
   

 

 

    

 

 

    

 

 

    

 

 

  

Total

   $ 2,986,441     $ (1,953,709 )    $ (650,792 )    $ 381,940  
   

 

 

    

 

 

    

 

 

    

 

 

  

The restructuring reserves at December 31, 2011 are included in accrued expenses and other liabilities in the Consolidated Balance Sheet, with all severance and benefit costs to be paid out within twelve months.