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HOUGHTON MIFFLIN HARCOURT COMPANY

(HMHC)
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HOUGHTON MIFFLIN HARCOURT CO : Costs Associated with Exit or Disposal Activities (form 8-K)

09/08/2020 | 08:03am EDT

Item 2.05. Costs Associated with Exit or Disposal Activities.

On September 4, 2020, Houghton Mifflin Harcourt Company (the "Company") finalized its previously announced voluntary early retirement incentive program (the "Voluntary Retirement Program"). The Voluntary Retirement Program was offered to all U.S. based employees who are at least 55 years of age and have at least five years of service with the Company. Of the eligible employees, 166 elected to participate in the Voluntary Retirement Program (the "Electing Employees"), representing approximately 5% of the Company's employee base. The majority of the Electing Employees will voluntarily retire from the Company as of September 4, 2020 with select Electing Employees leaving later in the year. However, Electing Employees have the option to withdraw from the Voluntary Retirement Program until September 21, 2020. Each of the Electing Employees will receive separation payments in accordance with the Company's severance policy and such separation payments are made for the relevant number of weeks in accordance with the Company's regular payroll schedule.

The total one-time, non-recurring cost incurred by the Company in connection with the Voluntary Retirement Program, all of which represents cash expenditures, is estimated to be approximately $13.5 million. As a result of the Voluntary Retirement Program the Company estimates annualized, run rate cost savings of approximately $17 to $18 million.



Forward-Looking Statements


The statements contained herein include forward-looking statements, including statements about the estimated costs, and cost savings, associated with the Voluntary Retirement Program. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and that actual results may differ materially. Important factors that could cause actual results to vary from expectations include, but are not limited to: the timing of full implementation of the Voluntary Retirement Program; the right of Eligible Employees to withdraw from the program; any unintended consequences from the program that impact our business; and the other factors discussed in the "Risk Factors" section of our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

All forward-looking statements are based upon information available to us on the date of this report. We undertake no obligation, and do not expect, to publicly update or publicly revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.

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© Edgar Online, source Glimpses

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