Northstar Neuroscience (NSTR) Cuts Workforce by 64%
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In a Form 8-K, Northstar Neuroscience, Inc. (Nasdaq: NSTR) today announced that on January 30, the company implemented a reduction in its workforce of approximately 64%, leaving the Company with 13 employees.
The Company took this action to reduce operating costs and align its operations with the Board of Director’s previously announced adoption of, and recommendation to the shareholders of, a Plan of Complete Liquidation and Dissolution. The Company expects to terminate substantially all of the remaining workforce by the end of the second quarter of 2009, with a small number of employees remaining to assist in the wind down of the Company’s operations, subject to shareholder approval.
In connection with the reduction in workforce that occurred on January 30, 2009 and the subsequent reduction of transitional employees, the Company expects to incur costs associated with termination benefits of approximately $2.5 million, comprised of severance payments and continuation of medical insurance benefits, and approximately $1.8 million of non-cash share-based compensation relating to the acceleration of equity award vesting. It is currently anticipated that these costs will be expensed during the first half of 2009.
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