(9) Lease Commitments with a sale of the property in Shelburne, Vermont from Pizzagalli Properties, LLC to an unrelated third party. Under terms of the lease termination agreement the company paid to the lessor $600,000 in cash and entered into an interest bearing note in the amount of $2,513,884. See Note 5 for further discussion of the note arrangement. The company leases warehouse space, office facilities and equip- ment under operating leases, which expire in fiscal 2005 and thereafter. The company also has a lease obligation for a manufac- turing facility that was exited in conjunction with manufacturing consolidation efforts related to the acquisition of Blodgett. Future payment obligations under these leases are as follows: During 2004 the company recorded adjustments to reduce the reserves for acquisition related costs by $1.9 million. The reserve adjustments reflect a reduction in obligations associated with the Shelburne facility resulting from the sale of that property which allowed the company to negotiate an early exit from the lease. The remaining reserve of $2.8 million represents estimated costs associated with the Quakertown, Pennsylvania lease net of anticipated sublease income. Management believes the remaining reserve balance is adequate to cover costs associated with the lease obligation. However, the forecast of sublease income could differ from actual amounts, which are subject to the occupancy  by a subtenant and a negotiated sublease rental rate. If the company’s estimates or underlying assumptions change in the future, the company would be required to adjust the reserve amount accordingly. A summary of the reserve balance activity is as follows  (in thousands): Rental expense pertaining to the operating leases was $0.7 million, $0.6 million, and $1.1 million in fiscal 2004, 2003, and 2002, respectively. Reserves of $2.8 million have been established for the idle facility leases, net of anticipated sublease income  (see Note 10 for further discussion). (10) Acquisition Integration Costs Operating Idle Facility Total Lease (dollars in thousands) Leases Lease Commitments 2005 $ 811 $ 354 $ 1,165 2006 685 366 1,051 2007 314 371 685 2008 277 376 653 2009 and thereafter 515 2,589 3,104 $ 2,602 $ 4,056 $ 6,658 Facility Closure Severance and Lease Obligations Obligations Total Balance December 29, 2001 $ 3,947 $ 6,928 $ 10,875 Reserve adjustments (92) 3,377 3,285 Payments (3,584) (812) (4,396) Balance December 28, 2002 271 9,493 9,764 Reserve adjustments (134) 176 42 Payments (122) (1,020) (1,142) Balance January 3, 2004 15 8,649 8,664 Reserve adjustments (11) (1,875) (1,886) Payments (4) (3,986) (3,990) Balance January 1, 2005 $ — $ 2,788 $ 2,785 (11) Segment Information In fiscal 2001, the company established reserves through purchase accounting associated with $3.9 million in severance related obligations and $6.9 million in facility exit costs related  to the business operations that were acquired from Maytag Corporation on December 21, 2001 of Blodgett. The company established reserves of $6.9 million associated with the facility closure and lease obligations for manufacturing facilities in Pennsylvania and Vermont that were exited in 2001 and 2002. These reserves were subsequently increased in 2002 by $3.4 million through purchase accounting due to changes in the assumptions related to the timing and amount of sublease income expected to be realized, resulting in an increase in goodwill. The facility in Quakertown, Pennsylvania was exited in 2001 prior to the acquisition of Blodgett. The lease extends on this facility through December 2014. The company is recovering a portion of the lease cost on a sublease that ends in April 2006. Two other facilities in Williston, Vermont and Shelburne, Vermont were  exited during the second quarter of 2002 in conjunction with the company’s consolidation initiatives following the Blodgett acquisi- tion. Lease obligations on these properties extended through June 2005 and December 2014, respectively. The company completed an early buyout for the Williston, Vermont property during the first quarter of 2004. During the fourth quarter of 2004, the company entered into an agreement with Pizzagalli Properties, LLC, to terminate the company’s lease obligations related to the facility  in Shelburne, Vermont. This transaction occurred simultaneously The company operates in two reportable operating segments defined by management reporting structure and operating activities. The worldwide manufacturing divisions operate through the Cooking Systems Group. This business division has manufacturing facilities in Illinois, New Hampshire, North Carolina, Vermont  and the Philippines. This division supports four major product groups, including conveyor oven equipment, core cooking equip- ment, counterline cooking equipment, and international specialty  equipment. Principal product lines of the conveyor oven product group include Middleby Marshall ovens, Blodgett ovens and CTX 31