| NOTE 13 - RESTRUCTURING CHARGE: |
| During the fourth quarter of fiscal
1998 the Company recorded a restructuring charge of $129.9 million
as a result of certain of the Company's actions to better align its
cost structure with expected revenue growth rates. The restructuring
activities (shown below in tabular format) primarily relate to: 1)
the elimination of job responsibilities company-wide, resulting in
costs incurred to sever employees and related asset write-downs and
lease abandonments related to the affected employees; 2) the relocation
of, and elimination of, certain job responsibilities of the Asia Pacific
headquarters in Hong Kong, resulting in reduction in workforce, lease
abandonments and other costs of downsizing the Hong Kong headquarters;
3) the downsizing of the Company's Japan distribution center, resulting
in the write-down of assets no longer in use; 4) the cancellation
of certain non-strategic long-term endorsement contracts, resulting
in one-time termination fees; and 5) the decision to exit certain
manufacturing operations of the Bauer subsidiary, resulting in the
reduction in manufacturing related jobs, the write-down of assets
no longer in use and the estimated loss on divestiture of certain
manufacturing plants.
The Company expects the plans associated with these costs to be substantially completed during the first half of fiscal 1999, with many of the costs associated with the reduction in workforce being incurred and paid in the fourth quarter of fiscal year 1998. Assets that are no longer in use have been sold or are held for sale at May 31, 1998 and were written down to their estimated fair values less costs of sale. Employees were terminated from almost all areas of the Company, including marketing, sales and administrative areas. The total number of employees terminated was 1,208, with 984 having left the Company as of May 31, 1998. The remaining employees will leave the Company during fiscal 1999. Details of the restructuring charge are as follows: (in millions)
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