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that were inconsistent with the Company’s strategic plan and were no longer required. As a result of this restructuring, the Company recorded restructuring charges totaling $20.7 million, classified in the Fiscal 2003 Consolidated Statement of Operations as ‘‘Restructuring Charges.’’ 

The restructuring charges include $5.9 million for severance, incentives and other employee benefit costs, including $2.9 million accrued for payments that are to be made pursuant to certain tax ‘‘gross up’’ provisions of the restricted stock award agreements that were granted to certain officers on February 28, 2003, and severance and other employee benefit costs to be paid to approximately 110 personnel; $6.1 million for a vacant warehouse that represents excess capacity as a result of the sale; and $8.7 million for the write-down to fair value of assets that were abandoned as part of the Corporate restructuring since they were inconsistent with the Company’s ongoing strategic plan. The Company estimates annual pre-tax cost savings beginning in Fiscal 2004 of approxi- mately $9.5 million, as a result of this restructuring. These estimates of future costs and benefits are subject to change during the final execution of the restructuring plan, as actual sublease factors and benefit costs could differ from those estimated. 

Payments for the aforementioned obligations will be funded out of working capital. The majority of these expenditures will be paid out in cash during Fiscal 2004, with the exception of lease payments, which could extend through 2017. 

In Fiscal 2002, management committed to a restructuring plan for certain Corporate and enterprise computer system operations. As a result of this action, the Company recognized restructuring charges totaling approxi- mately $1.5 million, of which $1.0 million is included in Fiscal 2002 ‘‘Cost of Goods Sold’’ and $0.5 million is classified in the Fiscal 2002 Consolidated Statement of Operations as ‘‘Restructuring Charges.’’ The restructuring charges of $0.5 million relate to severance and other employee benefits that were paid to approximately 20 personnel. As of March 31, 2003, this amount had been fully paid. In addition to costs associated with personnel reductions, the restructuring charges included provisions related to inventory valuation adjustments. 

In the fourth quarter of 2001, the Company recognized a $14.2 million pre-tax charge for a non-cash write- down related to the abandonment of certain IT system assets. 

## Other (income) expense, interest expense and income taxes 

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Other income, net in 2003 primarily consisted of $1.7 million of equity and dividend income earned from the Company’s investments in affiliates, partially offset by foreign currency exchange losses. Other income, net in 2002 consisted of $1.8 million of equity and dividend income earned from the Company’s investments in affiliates, combined with foreign currency exchange gains and other income. This income was partially offset by an investment write-off of $0.8 million combined with a $1.0 million charge associated with ineffectiveness of the Company’s previously held interest rate swap. Other income, net in 2001 consisted of foreign currency exchange losses offset by $0.9 million of equity and dividend income earned from investments in affiliates. 

The investment impairment in Fiscal 2003 represents a non-cash charge of $14.6 million to reduce the carrying value of the Company’s investment in Eurodis Electron PLC (‘‘Eurodis’’) to market value as of March 31, 2003. As a result of the Company’s sale of IED and subsequent change in business focus, Pioneer-Standard’s intent concerning this investment changed. The investment no longer holds strategic value and it is not the Company’s intent to retain the investment for a long period of time. Therefore, the decline in market value was deemed to be other than temporary and the Company recognized a charge in operations. 

Interest expense, net decreased $1.9 million in 2003 compared with 2002, and $5.0 million in 2002 compared with 2001 as a result of reduced outstanding borrowings on the Company’s debt facilities. In addition, the reduction in interest between 2002 and 2001 can be attributed to lower interest rates resulting from the 

