Item 2.05 Costs Associated with Exit or Disposal Activities.
On December 9, 2022 the Company signed agreements for early exit of its three
leaseholds in Sisters, Oregon and the sale of operations equipment and personal
property in such facilities. The Company will gain no operational benefit from
the leaseholds beginning late December 2022, and will terminate the lease
agreements on January 31, 2023. As such, the Company anticipates that it will
incur non-cash charges related to the impairment of its right of use assets and
factory equipment of up to $5.3 million in the fourth quarter of 2022, as well
as related net cash payments of $0.7 million expected to be made over the next
14 months. The amounts of the expected impairment and net cash payments are
estimates, and the amounts and timing of actual charges and payments may vary
due to a variety of factors.
We expect to incur other costs associated with additional impairments of assets
and other related restructuring and exit costs, including cash payments of up to
$1.0 million and non-cash charges of up to $2.2 million. These are estimates and
are still being evaluated.
Item 2.06 Material Impairments.
The information set forth in Item 2.05 above is hereby incorporated by reference
into this Item 2.06.
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