ITEM 2.05. COSTS ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES
On March 4, 2009 Sparton Corporation, an Ohio Corporation (the "Company"),
issued a Press Release ("Press Release") announcing that pursuant to action
taken by the Board of Directors on February 25, 2009, it would discontinue
manufacturing operations conducted at its plant located in Jackson, Michigan
(the "Jackson Facility") no later than June 30, 2009 and transition the
manufacturing operations to other Company facilities (the "Closing"). The
Company decided to discontinue manufacturing operations at the Jackson Facility
in response to current economic conditions, the state of competition within the
industries served by the Company, and as part of the Company's plan to return to
profitability.
The Company has estimated that it will incur costs in current and future fiscal
quarters related to the Closing of approximately $3.8 million to $4.8 million
but is unable at this time to provide more specific information on the costs and
amount of the costs it expects to incur. The Company expects to incur charges
related to employee severance, the transfer of production and production
equipment to other facilities, and facility closure and related impairment
charges, as well as other associated expenses. The Company has estimated that
the costs will primarily be incurred in the fourth quarter of fiscal year 2009
and thereafter, and that approximately $3.0 million of the total charges will be
in the form of cash expenditures. In accordance with the requirements of the
Securities and Exchange Commission, the Company will file an amendment on Form
8-K within four business days after making a specific determination of the
individual and aggregate amounts of such costs.
ITEM 7.01. REGULATION FD DISCLOSURE
The Company issued a Press Release on March 4, 2009 relating to the matters
described in the foregoing Item 2.05. A copy of the Press Release is attached
hereto as Exhibit 99.1 and is incorporated herein by reference. The foregoing
description of the Press Release is qualified in its entirety by reference to
the Press Release.
The information contained in this Item 7.01 and Exhibit 99.1 attached hereto is
intended to be furnished and shall not be deemed "filed" for the purposes of
Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), or incorporated by reference in any filing under the Securities Act of
1933, as amended, or the Exchange Act, except as expressly set forth by the
specific reference in such a filing.
