LodgeNet (LNET) Announces Implementation of Expense Reduction Program; Includes Workforce Reduction of 180 Positions
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In a Form 8-K, LodgeNet Interactive (Nasdaq: LNET) today announced that on November 20, the company implemented an expense reduction program, which included a 180-position reduction in its workforce, the indefinite deferral of compensation adjustments for all officers and employees, the suspension of the 401(k) corporate matching contribution, and the suspension of the Company’s 2009 bonus program. The Company is also investigating and planning for other operational expense savings for 2009.
As a result of the reduction in force, the Company expects to incur a charge of approximately $1,375,000 in Q408. This charge will include expenses related to the severance for terminated employees and other exit-related costs arising from contractual and other obligations. The charge is not expected to affect the Company’s compliance with its financial covenants during the fourth quarter of 2008 because related cash expenditures during the period will be offset by cash savings on salaries and related costs.
LodgeNet Interactive Corporation and its subsidiaries provide interactive media and connectivity solutions to the hospitality industry in the United States, Canada, and Mexico.
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