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## 3 RESTRUCTURING AND IMPAIRMENT CHARGES 

In the fourth quarter of Fiscal 2003, resulting from the sale of the Industrial Electronics Division, the Company announced that it would restructure its remaining business and facilities to reduce overhead and eliminate assets 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,’’ for the impairment of facilities and other assets no longer required, and severance, incentives and other employee benefit costs, including amounts accrued for payments that are to be made pursuant to certain tax ‘‘gross up’’ provisions of the restricted stock award agreements discussed in Note 14, incurred in connection with downsizing the corporate structure. 

Severance, incentives and other employee benefit costs are to be paid to approximately 110 personnel. Facilities costs represent the present value of qualifying exit costs, offset by estimated future sublease rentals provided by an external broker, for a vacant warehouse that represents excess capacity as a result of the sale. The lease on this facility extends through 2017. The asset impairment charge represents 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. 

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 relate to severance and other employee benefits to be paid to approximately 20 personnel. As of March 31, 2002, no payments had been made for any of these expenses. In addition to costs associated with personnel reductions, the restructuring charges included provisions related to inventory valuation adjustments. 

The changes to the Company’s restructuring accrual since March 31, 2002 are as follows: 

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Approximately $6.5 million of the remaining balance is expected to be spent before the end of Fiscal 2004. In 2001, the Company concluded a review of IT system assets and determined that certain work-in-process components totaling $14.2 million would not be integrated into the current systems and were thus abandoned. 

These assets were charged to expense in the fourth quarter of 2001. 

## 4 GOODWILL 

On April 1, 2002, the Company adopted SFAS No. 142, ‘‘Goodwill and Other Intangible Assets.’’ This Statement, among other things, eliminates the amortization of goodwill and other intangibles that have indefinite lives but requires annual tests for determining impairment of those assets. All other intangible assets continue to be amortized over their estimated useful lives. Effective April 1, 2002, the Company discontinued amortization of its goodwill in accordance with SFAS No. 142. 

