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Pensions and Other Employee Benefit Plans (Tables)
12 Months Ended
Dec. 31, 2013
Pensions and Other Employee Benefit Plans [Abstract]  
Reconciliation of Changes in Plans' Benefit Obligations and Fair Value of Assets

The following tables provide a reconciliation of the changes in the plans’ benefit obligations and fair value of assets for 2013 and 2012, and a statement of the funded status as of December 31, 2013 and 2012, respectively. Amounts shown for 2012 include activity for SS/L prior to the Sale on November 2, 2012. We use a December 31 measurement date for the pension plans and other post-retirement benefit plans (in thousands).

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension Benefits

 

Other Benefits

 

Year Ended December 31,

 

Year Ended December 31,

 

2013

 

2012

 

2013

 

2012

Reconciliation of benefit obligation:

 

 

 

 

 

 

 

 

 

 

 

Obligation at beginning of period

$

62,488 

 

$

549,013 

 

$

1,051 

 

$

66,049 

Service cost

 

311 

 

 

12,113 

 

 

 

 

447 

Interest cost

 

1,843 

 

 

21,675 

 

 

65 

 

 

2,597 

Participant contributions

 

28 

 

 

1,252 

 

 

51 

 

 

1,646 

Plan amendment

 

         —

 

 

(1,497)

 

 

230 

 

 

         —

Actuarial (gain) loss

 

(3,874)

 

 

7,690 

 

 

249 

 

 

(967)

Benefit payments

 

(1,868)

 

 

(21,200)

 

 

(147)

 

 

(2,662)

Transfer due to Sale

 

         —

 

 

(506,558)

 

 

         —

 

 

(66,059)

Curtailment and settlement

 

(18,686)

 

 

         —

 

 

16 

 

 

         —

Obligation at December 31,

 

40,242 

 

 

62,488 

 

 

1,517 

 

 

1,051 

Reconciliation of fair value of plan assets

 

 

 

 

 

 

 

 

 

 

 

Fair value of plan assets at beginning of period

 

20,207 

 

 

299,292 

 

 

         —

 

 

27 

Actual return on plan assets

 

3,120 

 

 

28,821 

 

 

         —

 

 

Employer contributions

 

3,955 

 

 

34,746 

 

 

96 

 

 

988 

Participant contributions

 

28 

 

 

1,252 

 

 

51 

 

 

1,646 

Benefit payments

 

(1,467)

 

 

(19,985)

 

 

(147)

 

 

(2,662)

Transfer due to Sale

 

(1,215)

 

 

(323,919)

 

 

         —

 

 

         —

Fair value of plan assets at December 31,

 

24,628 

 

 

20,207 

 

 

         —

 

 

         —

Funded status at end of period

$

(15,614)

 

$

(42,281)

 

$

(1,517)

 

$

(1,051)

 

Pre-Tax Amounts Recognized in Accumulated Other Comprehensive Loss

 

The pre-tax amounts recognized in accumulated other comprehensive loss as of December 31, 2013 and 2012 consist of (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension Benefits

 

Other Benefits

 

December 31,

 

December 31,

 

2013

 

2012

 

2013

 

2012

Actuarial loss

$

(9,636)

 

$

(23,698)

 

$

(444)

 

$

(244)

Amendments-prior service (cost) credit

 

         —

 

 

         —

 

 

(89)

 

 

74 

 

$

(9,636)

 

$

(23,698)

 

$

(533)

 

$

(170)

 

Amounts Recognized in Other Comprehensive Loss

The amounts recognized in other comprehensive loss during the years ended December 31, 2013 and 2012 consist of (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2013

 

2012

 

Pension Benefits

 

Other Benefits

 

Pension Benefits

 

Other Benefits

Actuarial gain (loss) during the period

$

5,491 

 

$

(249)

 

$

498 

 

$

967 

Prior service (cost) credit during the period

 

         —

 

 

(230)

 

 

1,497 

 

 

         —

Amortization of actuarial loss (gain)

 

5,947 

 

 

44 

 

 

9,773 

 

 

(279)

Amortization of prior service cost (credit)

 

         —

 

 

 

 

(2,266)

 

 

(611)

Recognition due to curtailment

 

2,624 

 

 

63 

 

 

(1,497)

 

 

         —

Amount reclassified to statement of operations upon disposition of SS/L

 

         —

 

 

         —

 

 

135,618 

 

 

(12,241)

Total recognized in other comprehensive income (loss)

$

14,062 

 

$

(363)

 

$

143,623 

 

$

(12,164)

 

Amounts Recognized in the Balance Sheets

Amounts recognized in the balance sheet consist of (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension Benefits

 

Other Benefits

 

December 31,

 

December 31,

 

2013

 

2012

 

2013

 

2012

Current Liabilities

$

         —

 

$

18,075 

 

$

128 

 

$

83 

Long-Term Liabilities

 

15,614 

 

 

24,206 

 

 

1,389 

 

 

968 

 

$

15,614 

 

$

42,281 

 

$

1,517 

 

$

1,051 

 

Components of Net Periodic Cost

 

The following table provides the components of net periodic cost included in income from continuing operations for the plans for the years ended December 31, 2013, 2012 and 2011 (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pension Benefits

 

Other Benefits

 

 

Year Ended December 31,

 

 

Year Ended December 31,

 

2013

 

2012

 

2011

 

2013

 

2012

 

2011

Service cost

$

311 

 

$

824 

 

$

802 

 

$

 

$

 

$

Interest cost

 

1,843 

 

 

2,523 

 

 

2,480 

 

 

65 

 

 

45 

 

 

48 

Expected return on plan assets

 

(1,503)

 

 

(1,435)

 

 

(1,376)

 

 

         —

 

 

         —

 

 

         —

Recognition due to curtailment

 

1,671 

 

 

(1,497)

 

 

         —

 

 

78 

 

 

         —

 

 

         —

Amortization of prior service credit

 

         —

 

 

         —

 

 

         —

 

 

 

 

(24)

 

 

(24)

Amortization of net actuarial loss (gain)

 

5,947 

 

 

748 

 

 

268 

 

 

44 

 

 

12 

 

 

Net periodic cost

$

8,269 

 

$

1,163 

 

$

2,174 

 

$

198 

 

$

39 

 

$

34 

 

Assumptions Used to Determine Net Periodic Cost

Assumptions used to determine net periodic cost:

 

 

 

 

 

 

 

 

 

For the Year Ended December 31,

 

2013

 

2012

 

2011

Discount rate

4.00%

 

4.75%

 

5.50%

Expected return on plan assets

7.25%

 

8.00%

 

8.00%

Rate of compensation increase

4.25%

 

4.25%

 

4.25%

 

Assumptions Used to Determine Benefit Obligation

Assumptions used to determine the benefit obligation:

 

 

 

 

 

 

 

 

 

December 31,

 

2013

 

2012

 

2011

Discount rate

4.75%

 

4.00%

 

4.75%

Rate of compensation increase

4.25%

 

4.25%

 

4.25%

 

Effect of Changes in Assumptions on Benefit Obligations for Other Benefits

A one percent change in assumed health care cost trend rates for 2013 would have the following effects (in thousands):

 

 

 

 

 

 

 

1% Increase

 

1% Decrease

Effect on total of service and interest cost components of net periodic postretirement health care benefit cost

$                    5

 

$                   (5)

Effect on the health care component of the accumulated postretirement benefit obligation

$                142

 

$               (122)

 

Pension Plans' Actual and Targeted Asset Allocations

The pension plans’ actual and targeted asset allocations are as follows:

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

 

Actual Allocation

 

Target Allocation

 

2013

 

2012

 

Target

 

Target Range

Equities

58% 

 

59% 

 

60% 

 

50-70%

Fixed Income

42% 

 

41% 

 

40% 

 

30-50%

 

100% 

 

100% 

 

100% 

 

100% 

 

Target Asset Allocations and Ranges of Post Retirement Benefit Plan

The target and target range levels can be further defined as follows:

 

 

 

 

 

 

 

Target Allocation

 

Target

 

Target Range

U.S. Large Cap Equities

25% 

 

15-40%

U.S. Small Cap Equities

5% 

 

0-10%

Global Equities

10% 

 

5-20%

Non-U.S. Equities

10% 

 

5-20%

Alternative Equity Investments

10% 

 

0-20%

Total Equities

60% 

 

50-70%

 

 

 

 

Fixed Income

30% 

 

20-40%

Alternative Fixed Income Investments

10% 

 

0-20%

Total Fixed Income

40% 

 

30-50%

 

 

 

 

Total Target Allocation

100% 

 

100% 

 

Fair Values of Pension Plan Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value Measurements

 

 

 

 

 

 

Quoted Prices

 

 

 

 

 

 

 

 

 

 

In Active Markets

 

Significant

 

Significant

 

 

 

 

 

 

For Identical

 

Observable

 

Unobservable

 

 

 

 

 

 

Assets

 

Inputs

 

Inputs

Asset Category

 

Total

 

Percentage

 

Level 1

 

Level 2

 

Level 3

 

 

(In thousands)

At December 31, 2013:

 

 

 

 

 

 

 

 

 

 

Equity securities:

 

 

 

 

 

 

 

 

 

 

U.S. large-cap(1) 

 

$       5,965 

 

24% 

 

 

 

$            5,965 

 

 

U.S. small-cap(2) 

 

1,688 

 

7% 

 

 

 

1,688 

 

 

Global (3)          

 

1,956 

 

8% 

 

 

 

1,956 

 

 

Non-U.S.(4) 

 

3,103 

 

13% 

 

 

 

3,103 

 

 

Alternative investments:

 

 

 

 

 

 

 

 

 

 

Equity long/short fund(5) 

 

842 

 

3% 

 

 

 

 

 

$                  842 

Real Estate Securities(6) 

 

482 

 

2% 

 

 

 

482 

 

 

Private equity fund(7) 

 

287 

 

1% 

 

 

 

 

 

287 

 

 

14,323 

 

58% 

 

         —

 

13,194 

 

1,129 

Fixed income securities:

 

 

 

 

 

 

 

 

 

 

Commingled funds(8) 

 

8,650 

 

35% 

 

 

 

8,650 

 

 

Alternative investments:

 

 

 

 

 

 

 

 

 

 

Distressed opportunity limited
partnership(9) 

 

364 

 

2% 

 

 

 

 

 

364 

Multi-strategy limited partnerships(10) 

 

1,291 

 

5% 

 

 

 

 

 

1,291 

 

 

10,305 

 

42% 

 

         —

 

8,650 

 

1,655 

 

 

 

 

 

 

 

 

 

 

 

 

 

$     24,628 

 

100% 

 

         —

 

$          21,844 

 

$               2,784 

 

 

 

 

 

 

 

 

 

 

 

At December 31, 2012:

 

 

 

 

 

 

 

 

 

 

Equity securities:

 

 

 

 

 

 

 

 

 

 

U.S. large-cap(1) 

 

$       4,580 

 

23% 

 

 

 

$            4,580 

 

 

U.S. small-cap(2) 

 

1,257 

 

6% 

 

 

 

1,257 

 

 

Global (3)          

 

1,475 

 

7% 

 

 

 

1,475 

 

 

Non-U.S.(4) 

 

2,427 

 

12% 

 

 

 

2,427 

 

 

Alternative investments:

 

 

 

 

 

 

 

 

 

 

Equity long/short fund(5) 

 

682 

 

3% 

 

 

 

 

 

$                  682 

Real Estate Securities(6) 

 

411 

 

2% 

 

 

 

411 

 

 

Receivable from sale of real estate(6)

 

748 

 

4% 

 

$                           748 

 

 

 

 

Private equity fund(7) 

 

283 

 

2% 

 

 

 

 

 

283 

 

 

11,863 

 

59% 

 

748 

 

10,150 

 

965 

Fixed income securities:

 

 

 

 

 

 

 

 

 

 

Commingled funds(8) 

 

6,821 

 

34% 

 

 

 

6,821 

 

 

Alternative investments:

 

 

 

 

 

 

 

 

 

 

Distressed opportunity limited
partnership(9) 

 

299 

 

1% 

 

 

 

 

 

299 

Multi-strategy limited partnerships(10) 

 

1,191 

 

6% 

 

 

 

 

 

1,191 

Other limited partnerships(11) 

 

33 

 

0% 

 

 

 

 

 

33 

 

 

8,344 

 

41% 

 

         —

 

6,821 

 

1,523 

 

 

 

 

 

 

 

 

 

 

 

 

 

$     20,207 

 

100% 

 

$                           748 

 

$          16,971 

 

$               2,488 

 

(1)    Investments in common stocks that rank among the largest 1,000 companies in the U.S. stock market.

 

(2)    Investments in common stocks that rank among the small capitalization stocks in the U.S. stock market.

 

(3)Investments in common stocks across the world without being limited by national borders or to specific regions.

 

(4)    Investments in common stocks of companies from developed and emerging countries outside the United States.

 

(5)    Investments primarily in long and short positions in equity securities of U.S. and non-U.S. companies. The fund has semi-annual tender offer redemption periods on June 30 and December 31 and is reported on a one month lag. 

 

(6)    As of December 31, 2013, the pension plan was invested in real estate through a fund of funds which invests in global public real estate securities (REITs). As of December 31, 2012, the pension plan also had a receivable from a fund that invests in private real estate investments.  During 2012, we decided to end the pension plan’s investment in the fund. Settlement of the receivable occurred in 2013 with the proceeds reinvested per our allocation guidelines.

 

(7)    Fund invests in portfolios of secondary interest in established venture capital, buyout, mezzanine and special situation funds on a global basis. Fund is valued on a quarterly lag with adjustment for subsequent cash activity.

 

(8)Investments in bonds representing many sectors of the broad bond market with both short-term and intermediate-term maturities.

 

(9)    Investments mainly in discounted debt securities, bank loans, trade claims and other debt and equity securities of financially troubled companies. This partnership has semi-annual withdrawal rights on June 30 and December 31. This fund is reported on a one month lag.

 

(10)

Investments mainly in partnerships that have multi-strategy investment programs and do not rely on a single investment model. One partnership has quarterly liquidation rights with notice of 65 days while the second partnership has monthly liquidation rights with notice of 33 days. Both funds are reported on a one month lag.

 

(11)

As of December 31, 2012, the pension plan invested in other partnerships that had reached their end of life and had closed and were unwinding their holdings, mainly partnerships that provided mezzanine financing.

Changes in Fair Value of Pension Plan Assets

 

Additional information pertaining to the changes in the fair value of the pension plan assets classified as Level 3 for the years ended December 31, 2013 and 2012 is presented below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair Value Measurements Using Significant
Unobservable Inputs (Level 3)

 

Private
Equity
Fund

 

Equity
Long/Short
Fund

 

Distressed
Opportunity
Ltd. Partnership

 

Other
Limited
Partnership

 

 Multi
Strategy
Funds

 

 Real
Estate
Fund

 

Total  

 

(In thousands)

Balance at January 1, 2012

$        6,870 

 

$       10,557 

 

$                  5,217 

 

$               36 

 

$      19,916 

 

$      11,835 

 

$      54,431 

Unrealized gain/(loss)

(441)

 

(1,027)

 

(241)

 

 

335 

 

         —

 

(1,372)

Realized gain/(loss)

413 

 

2,221 

 

211 

 

         —

 

142 

 

838 

 

3,825 

Purchases

400 

 

         —

 

         —

 

23 

 

         —

 

         —

 

423 

Sales

(1,600)

 

         —

 

         —

 

(28)

 

         —

 

(748)

 

(2,376)

Asset transfer due to Sale

(5,359)

 

(11,069)

 

(4,888)

 

         —

 

(19,202)

 

(11,925)

 

(52,443)

Balance at December 31, 2012

283 

 

682 

 

299 

 

33 

 

1,191 

 

         —

 

2,488 

Unrealized gain/(loss)

62 

 

160 

 

65 

 

(10)

 

100 

 

         —

 

377 

Purchases

 

         —

 

         —

 

         —

 

         —

 

         —

 

Sales

(67)

 

         —

 

         —

 

(23)

 

         —

 

         —

 

(90)

Balance at December 31, 2013

$           287 

 

$            842 

 

$                     364 

 

$                  - 

 

$        1,291 

 

$                - 

 

$        2,784 

 

Benefit Payments Expected to be Paid

The following benefit payments, which reflect future services, as appropriate, are expected to be paid (in thousands):

 

 

 

 

 

 

 

 

 

 

 

Other Benefits

 

Pension
Benefits

 

Gross
Benefit
Payments

 

Medicare
Subsidy
Receipts

2014

1,616

 

132

 

5

2015

1,611

 

127

 

6

2016

1,624

 

119

 

8

2017

1,620

 

105

 

9

2018

1,809

 

106

 

10

2019 to 2023

10,788

 

519

 

58