Zacatecas facility closure:

In the fourth quarter of 2020, we approved our plans to close our Zacatecas manufacturing operations. The employee group was notified in the first week of January 2021, with the corresponding involuntary severance charges of $2,317 recorded as at January 3, 2021 relating to the estimated contractual obligations at that time impacting approximately 570 employees.  The closure of the Zacatecas manufacturing facility also impacted approximately 287 employees during the July 2020 headcount reduction with a corresponding severance charge of $783.  Also associated with the Zacatecas closure, were other associated closure costs of $328 which related to designated employee time to closure activities.  Lastly, $955 is provisioned primarily associated with inventory and accounts receivable related to customers serviced in Zacatecas that is not believed to be recoverable.

The closure of the Zacatecas facility and majority of the cash outflows associated within the restructuring liability for severance and other exit costs is anticipated to be substantially completed by the end of the first quarter of 2021. The majority of the customers serviced in the Zacatecas facility will be transferred to our Chihuahua Mexico facility.  A total restructuring charge of $4,383 was recorded in the twelve months ended January 3, 2021 relating to the announced planned closure.

Other restructuring charges:

During 2020 involuntary employee termination benefit costs and other recoveries of $400 pursuant to one time termination plans were incurred related to the reduction of 20 full-time equivalents (“FTEs”) in U.S offset by recoveries of $658 of previously provisioned inventory and revisions of the original restructuring accrual related to the Dongguan restructuring provision.

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Restructuring Liability: