Annual report pursuant to Section 13 and 15(d)

Facilities Realignment

v2.4.0.6
Facilities Realignment
 12 Months Ended
Dec. 31, 2012
Restructuring and Related Activities [Abstract]  
Costs Associated with Exit or Disposal Activities or Restructurings, Policy
Facilities Realignment
 
Saddle River, New Jersey Facility
 
Prior to December 2009, the Company's corporate headquarters were located in a three-floor facility in Saddle River, New Jersey. In 2007, the Company entered into a sublease for the second floor of its Saddle River, New Jersey facility through the end of the facility's lease term, January 2016. This sublease will not fully offset the Company's lease obligations for this space; therefore, the Company recorded a $1.0 million charge for facility realignment and related asset impairment for furniture and leasehold improvements in the office space.

In December 2009, the Company relocated its corporate headquarters from its Saddle River, New Jersey facility to a smaller office located in Parsippany, New Jersey. Due to the relocation, the Company recorded a facility realignment charge of approximately $3.9 million in December 2009 and a non-cash impairment charge of approximately $1.5 million related to furniture, leasehold improvements and office equipment in the office space. Effective September 1, 2009, the Company extended the sublease for the first floor of its Saddle River, New Jersey facility through the remainder of the facility lease term. The sublease is expected to provide approximately $2.3 million in sublease income through January 2016, but will not fully offset the Company's lease obligations for this space. As a result, the Company recorded a $0.8 million facility realignment charge in the third quarter of 2009. The Company also recorded a non-cash impairment charge of approximately $0.4 million related to furniture and leasehold improvements in the office space.

Due to continued adverse conditions in the real estate market in 2010, the Company adjusted its assumptions regarding its ability to sublease unoccupied space on the third floor of the Saddle River, New Jersey facility resulting in realignment charges of approximately $0.6 million and $1.4 million during the quarters ended June 30, 2010 and December 31, 2010, respectively. In September 2011, the Company secured a sublease for the approximately 47,000 square feet of remaining space in Saddle River, New Jersey. This sublease runs through the end of the facility's lease term, January 2016. The Company expects to receive approximately $2.2 million in lease payments over the life of the sublease.
Parsippany, New Jersey Group DCA Facility
In the fourth quarter of 2012, the Company down-sized its operations at Group DCA, exiting approximately 9,000 square feet of space and recorded $0.6 million in realignment charges and $0.1 million in non-cash impairments of furniture and leasehold improvements. The Company expects to sublease the space in the second half of 2013.
Dresher, Pennsylvania Facility
During the year ended December 31, 2009, the Company continued to right-size its operations in Dresher, Pennsylvania and recorded facility realignment charges of $1.4 million and non-cash impairments of furniture and leasehold improvements of $0.7 million. During 2010, the Company discontinued the operations of its TVG business unit and exited the remaining portion of space at the facility, thus recording additional restructuring charges of $0.3 million for facility realignment and $0.6 million for non-cash asset impairments of furniture and leasehold improvements in discontinued operations for the year ended December 31, 2010. See Note 12, Discontinued Operations, for further information regarding the discontinued operations of TVG.
As of December 31, 2012, all of the space in Dresher, Pennsylvania has been subleased.  These subleases have lease terms that expire on November 30, 2016 in connection with the underlying facility lease.  
Schaumburg, Illinois Facility
In December 2011, the Company sold certain assets of its Pharmakon business unit, vacated the business units' Schaumburg, Illinois facility and recorded a facility realignment charge of $0.4 million in discontinued operations. During the first quarter of 2012, the Company secured a sublease for the approximately 6,700 square feet of office space in Schaumburg, Illinois. This sublease runs through the end of the facility's lease term, February 2015. The Company expects to receive approximately $0.3 million in lease payments over the life of the sublease.

A summary of the significant components of the facility realignment charges for the years ended December 31, 2011 and 2012 by segment is as follows: 

 
Sales
 
Marketing
 
Discontinued
 
 
2011
Services
 
Services
 
Operations
 
Total
Facility lease obligations
$
—

 
$
—

 
$
392

 
$
392

Asset impairments
—

 
—

 
—

 
—

Related charges
—

 
—

 
—

 
—

Total facility realignment charge
$
—

 
$
—

 
$
392

 
$
392

2012
 

 
 
 
 

 
 

Facility lease obligations
$
—

 
$
637

 
$
78

 
$
715

Asset impairments
—

 
69

 
—

 
69

Related charges
—

 
—

 
—

 
—

Total facility realignment charge
$
—

 
$
706

 
$
78

 
$
784



The following table presents a reconciliation of the restructuring charges in the years ended 2012 and 2011 to the balances as of December 31, 2012 and 2011, which is included in other accrued expenses ($1.5 million and $1.8 million, respectively) and in long-term liabilities ($1.8 million and $2.7 million, respectively):
 
Sales
Services
 
Marketing Services
 
Discontinued Operations
 
Total
Balance as of January 1, 2011
$
5,029

 
$
—

 
$
1,272

 
$
6,301

Accretion
132

 
—

 
27

 
159

Adjustments
(158
)
 
—

 
364

 
206

Payments
(1,586
)
 
—

 
(591
)
 
(2,177
)
Balance as of December 31, 2011
3,417

 
—

 
1,072

 
4,489

Accretion
112

 
—

 
30

 
142

Adjustments
—

 
637

 
78

 
715

Payments
(1,502
)
 
—

 
(565
)
 
(2,067
)
Balance as of December 31, 2012
$
2,027

 
$
637

 
$
615

 
$
3,279