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RESTRUCTURING ACTIVITIES
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12 Months Ended | ||
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Sep. 30, 2011
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| RESTRUCTURING ACTIVITIES |
On
January 4, 2010, our Board of Directors approved a reduction in
force that resulted in the termination of approximately 33% of the
Company's workforce, effective January 7, 2010. On
February 23, 2010, our Board of Directors approved an additional
reduction in force that resulted in the termination of
approximately 20% of our workforce, effective March 4,
2010. These reductions in force were related to our
ongoing restructuring and cost reduction efforts as the Board of
Directors explores a variety of strategic alternatives, including
the potential sale of the Company or certain of its assets and/or
the acquisition of other entities or businesses.
The
Company incurred charges of $143,000 in connection with the
reductions in force, consisting of one-time employee termination
benefits. All amounts were paid as of September 30,
2010.
On
November 30, 2010, our Board of Directors approved a reduction in
force that resulted in the termination of 36 employees of the
Company, or approximately 60% of the Company’s workforce,
effective December 1, 2010. The reduction in force was
related to the Company’s ongoing restructuring and cost
reduction efforts and strategy of focusing its resources on the
development and expansion of its core InstantProfile product, the
successor to the Company’s LEC-billed directory
product. All terminated employees were involved in the
marketing and sale of the Company’s InstantPromote product by
its subsidiary, Local Marketing Experts, Inc.
The
Company incurred expenses of $99,319 in connection with the
reduction in force, of which $37,500 was incurred for one-time
employee termination benefits payable in cash. The
remaining expenses relate to salaries and wages payable in cash to
the affected employees which were paid in the first quarter of
fiscal 2011.
In
May 2011 the Company ceased the Direct Sales business and migrated
the remaining customers to Reach Local in exchange for ten and five
percent of gross revenues derived from such customers during the
first and second year, respectively. The Company
recorded $5,773 in revenues for this agreement during the year
ended September 30, 2011. In connection with the
discontinued Direct Sales business, seven employees were
terminated. See Note 3.
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