During the first quarter of 2019, the Company initiated a restructuring program to further optimize its Company-operated Aaron's store base portfolio, which resulted in the closure and consolidation of 84 underperforming Company operated stores throughout the first three months of 2019. During the second quarter of 2019, the Company identified an additional 70 stores to be closed, consolidated, or relocated, with the majority of the stores closing during the three months ended June 30, 2019. The Company also further rationalized its home office and field support staff, which resulted in a reduction in employee headcount in those areas to more closely align with current business conditions.

Total net restructuring expenses of $18.1 million and $31.0 million were recorded for the three and six months ended June 30, 2019 under the 2019 restructuring program, all of which were incurred within the Aaron's Business segment. Restructuring activity for the three and six months ended June 30, 2019 was comprised of closed store operating lease right-of-use asset impairment and operating lease charges, the write-off and impairment of store property, plant and equipment, related workforce reductions, and other impairment charges. These costs were included in restructuring expenses, net in the condensed consolidated statements of earnings. The Company does not expect to incur material additional restructuring charges for this program. However, this estimate is subject to change based on future sublease activity and potential earlier buyouts of leases with landlords.

During the years ended December 31, 2017 and 2016, the Company initiated restructuring programs to rationalize its Company-operated Aaron's store base portfolio to better align with marketplace demand. The programs resulted in the closure and consolidation of 139 underperforming Company operated stores throughout 2016, 2017, and 2018. The Company also optimized its home office staff and field support, which resulted in a reduction in employee headcount in those areas to more closely align with current business conditions.

Total net restructuring expenses of $0.6 million and $1.0 million were recorded for the three and six months ended June 30, 2019 under the 2017 and 2016 restructuring programs, all of which were incurred within the Aaron's Business segment. Restructuring activity for the three and six months ended June 30, 2019 was comprised principally of additional operating lease right-of-use asset impairment charges due to changes in estimates of future sublease activity and early buyouts of leases with landlords, as well as operating lease charges for stores closed under the restructuring program. These costs were included in restructuring expenses, net in the condensed consolidated statements of earnings. The Company does not expect to incur any further material charges under the 2017 and 2016 restructuring programs. However, this estimate is subject to change based on future sublease activity and potential earlier buyouts of leases with landlords.



	Three Months Ended June 30,					Six Months Ended June 30,
(In Thousands)	2019		2018			2019		2018
Right-of-Use Asset Impairment and Operating Lease Charges	$	15,266	$	207		$	24,788	$	926
Fixed Asset Impairment	1,072		—			2,569		—
Severance	1,856		87			2,992		601
Other Expenses (Reversals)	544		(1,176		)	1,670		(1,176		)
Gain on Sale of Closed Store Properties	—		—			—		(327		)
Total Restructuring Expenses (Reversals), Net	$	18,738	$	(882	)	$	32,019	$	24

The following table summarizes the balances of the accruals for the restructuring programs, which are recorded in accounts payable and accrued expenses in the condensed consolidated balance sheets, and the activity for the six months ended June 30, 2019:



(In Thousands)	Contractual Lease Obligations			Severance
Balance at January 1, 2019	$	8,472		$	651
ASC 842 Transition Adjustment¹	(8,472		)	—
Adjusted Balance at January 1, 2019	—			651
Restructuring Charges	—			2,992
Payments	—			(2,427		)
Balance at June 30, 2019	$	—		$	1,216

¹Upon the adoption of ASC 842 on January 1, 2019, the Company reclassified the remaining liability for contractual lease obligations from accounts payable and accrued expenses to a reduction to operating lease right-of-use assets within its condensed consolidated balance sheets.