Reorganization and Realignment Costs

The following is a summary of the initiatives included in “Reorganization and realignment costs:”


	Three Months Ended				Six Months Ended
	July 2, 2023		July 3, 2022		July 2, 2023		July 3, 2022
Organizational redesign	$	670	$	—	$	7,407	$	—

Other reorganization and realignment plans	11		156		82		620
Reorganization and realignment costs	$	681	$	156	$	7,489	$	620

Organizational Redesign

In February 2023, the Board of Directors approved a plan to redesign the Company’s organizational structure to better support the execution of the Company’s long-term growth strategy by maximizing organizational efficiency and streamlining decision making (the “Organizational Redesign Plan”). As a result of the Organizational Redesign Plan, the Company expects to hold its general and administrative expense in 2023 and 2024 relatively flat compared with 2022. The Company expects to incur total costs of approximately $11,000 to $13,000 related to the Organizational Redesign Plan. During the six months ended July 2, 2023, the Company recognized costs totaling $7,407, which primarily included severance and related employee costs and share-based compensation. The Company expects to incur additional costs aggregating approximately $3,500 to $5,500, comprised of (1) severance and related employee costs of approximately $2,500, (2) recruitment and relocation costs of approximately $800, (3) third-party and other costs of approximately $300 and (4) share-based compensation of approximately $1,000. The Company expects costs related to the Organizational Redesign Plan to continue into 2026, with approximately three-fourths of the total costs to be recognized during 2023.

The following is a summary of the costs recorded as a result of the Organizational Redesign Plan:


	Three Months Ended		Six Months Ended
	July 2, 2023		July 2, 2023
Severance and related employee costs	$	21	$	5,560
Recruitment and relocation costs	86		164
Third-party and other costs	386		731
	493		6,455
Share-based compensation (a)	177		952
Total organizational redesign	$	670	$	7,407

(a)Primarily represents the accelerated recognition of share-based compensation resulting from the termination of employees under the Organizational Redesign Plan.

As of July 2, 2023, the accruals for the Organizational Redesign Plan are included in “Accrued expenses and other current liabilities” and “Other liabilities” and totaled $3,038 and $117, respectively. The table below presents a rollforward of our accruals for the Organizational Redesign Plan.


	Balance January 1, 2023		Charges		Payments		Balance July 2, 2023
Severance and related employee costs	$	—	$	5,560	$	(2,405)	$	3,155
Recruitment and relocation costs	—		164		(164)		—
Third-party and other costs	—		731		(731)		—
	$	—	$	6,455	$	(3,300)	$	3,155

Other Reorganization and Realignment Plans

Costs incurred under the Company’s other reorganization and realignment plans were not material during the six months ended July 2, 2023 and July 3, 2022. The Company does not expect to incur any material additional costs under these plans.