Note 12: Pension and Other Postretirement Benefit Plans

We have retirement and pension plans that cover most of our employees. Many of our U.S. employees, as well as the employees of certain non-U.S. subsidiaries, are covered by contributory defined benefit plans under which employees previously contributed up to 4% of covered compensation annually. These plans have been fully frozen since March 2010. Annual employer contributions are made to the extent such contributions are actuarially determined to adequately fund the plans. There are also defined contribution voluntary savings programs generally available for U.S. employees, which are intended to qualify under Sections 401(a) and 401(k) of the Internal Revenue Code. These plans are designed to enhance the retirement programs of participating employees. Under these plans, we match up to 80% of a certain portion of participants' contributions and 50% in the case of the Vocollect 401(k) plan. Matching contributions for these plans were $4.2 and $2.7 million for the years ended December 31, 2011 and 2010, respectively.

Our business restructuring plan in April 2009 reduced our workforce and resulted in the curtailment of pension benefits to the terminated employees who were participants in the U.S. pension plans. Additionally, on December 30, 2009, we made the decision to fully freeze benefit accruals under our U.S. Financial Security and Savings Program and U.S. Pension Plan, effective February 28, 2010. Also, we fully froze additional benefit accruals under the U.S. Restoration Plan and U.S. Supplemental Executive Retirement Plan, effective December 31, 2009. We recorded a gain of $0.7 million in our 2009 consolidated statements of operations for these two curtailments.

We measure our plan assets and benefit obligations at fiscal year end. The following table sets forth the change in benefit obligations and plan assets of our pension plans and the funded status as of December 31, 2011 and 2010 (in thousands):


	2011						2010
	U.S.			Non-U.S.			U.S.			Non-U.S.
Change in benefit obligations:
Benefit obligation at beginning of year	$	227,207		$	45,683		$	198,617		$	45,846
Service cost		-			172			(159	)		-
Interest cost		12,099			2,292			11,762			2,144
Special termination benefits		-			-			139			-
Plan participants' contributions		1,826			58			1,746			-
Actuarial loss		28,875			2,172			23,176			1,494
Benefits paid		(8,752	)		(2,779	)		(8,074	)		(2,756	)
Foreign currency translation adjustment		-			1,291			-			(1,045	)

Benefit obligation at end of year	$	261,255		$	48,889		$	227,207		$	45,683


Change in plan assets
Fair value of plan assets at beginning of year	$	134,807		$	41,380		$	123,435		$	39,601
Actual return on plan assets		9,470			1,096			14,164			3,663
Plan participants' contributions		1,826			58			1,746			-
Employer contributions		5,548			1,233			3,536			2,070
Benefits paid		(8,752	)		(2,779	)		(8,074	)		(2,756	)
Foreign currency translation adjustment		-			1,366			-			(1,198	)

Fair value of plan assets at end of year	$	142,899		$	42,354		$	134,807		$	41,380


Funded status		(118,356	)		(6,535	)		(92,400	)		(4,303	)

Net amount recognized	$	(118,356	)	$	(6,535	)	$	(92,400	)	$	(4,303	)

Amounts pertaining to our U.S. and non-U.S. pension plans recognized on our consolidated balance sheets are classified as follows (in thousands):


	December 31, 2011						December 31, 2010
	U.S.			Non-U.S.			U.S.			Non-U.S.
Current liabilities	$	(3,884	)	$	-		$	(3,630	)	$	-
Noncurrent liabilities		(114,472	)		(6,536	)		(88,770	)		(4,303	)

Net amount recognized	$	(118,356	)	$	(6,536	)	$	(92,400	)	$	(4,303	)

The accumulated benefit obligation for the U.S. plans was $261.3 and $227.2 million as of December 31, 2011 and 2010, respectively. The accumulated benefit obligation for the non-U.S. plans was $48.9 and $45.7 million as of December 31, 2011 and 2010, respectively.

Amounts recognized in accumulated other comprehensive loss as of December 31, 2011 and 2010 are as follows (in thousands):


	December 31, 2011			December 31, 2010
Actuarial loss	$	(116,257	)	$	(85,732	)

Total in accumulated other comprehensive loss	$	(116,257	)	$	(85,732	)

The estimated amount that will be amortized from accumulated other comprehensive loss into net periodic pension cost during the year ending December 31, 2012 is as follows (in thousands):


	Pension Plans
Recognized actuarial loss	$	4,187
Transition assets		(133	)

Total	$	4,054

The table below sets forth amounts for our pension plans with accumulated benefit obligations in excess of fair value of plan assets (in thousands):


	December 31, 2011				December 31, 2010
	U.S.		Non-U.S.		U.S.		Non-U.S.
Projected benefit obligation	$	261,255	$	48,889	$	227,207	$	45,683
Accumulated benefit obligation		261,255		48,889		227,207		45,683
Fair value of plan assets		142,899		42,354		134,807		41,380

We expect to contribute approximately $11.7 and $1.2 million to our U.S. and non-U.S. pension plans, respectively, in 2012.

The weighted average actuarial assumptions used to determine benefit obligations at the end of the 2011 and 2010 fiscal years are as follows:


	December 31, 2011						December 31, 2010
	U.S.			Non-U.S.			U.S.			Non-U.S.
Discount rate		4.65	%		4.63	%		5.43	%		5.13	%

A summary of the components of net periodic pension cost (income) for our defined benefit plans and defined contribution plans are as follows (in thousands):


	December 31, 2011						December 31, 2010						December 31, 2009
	U.S.			Non-U.S.			U.S.			Non-U.S.			U.S.			Non-U.S.
Components of net periodic pension costs (income):
Service cost	$	-		$	-		$	(159	)	$	-		$	1,018		$	296
Interest cost		12,099			2,191			11,762			2,144			11,795			1,846
Expected return on plan assets		(10,753	)		(2,133	)		(11,210	)		(2,095	)		(10,745	)		(2,236	)
Amortization of prior service cost								264			-			425			-
Recognized net actuarial loss		2,252			675			891			536			25			37
Amortization of transition asset		-			(138	)		-			(132	)		-			(125	)
Curtailment gain		-			-			-			-			(722	)		-

Subtotal - defined benefit plan		3,598			595			1,548			453			1,796			(182	)
Defined contribution plans		-			-			34			-			116			-

Net periodic pension cost (income)	$	3,598		$	595		$	1,582		$	453		$	1,912		$	(182	)

The weighted average actuarial assumptions used to determine net periodic pension cost are as follows:


	U.S.						Non-U.S.
	Year ended December 31,						Year ended December 31,
	2011		2010		2009		2011		2010		2009

Discount rate		5.44%		6.04%		7.31%		5.10%		5.32%		5.79%
Expected return on plan assets		7.75%		8.20%		8.00%		5.29%		5.41%		5.41%

Our analysis of the asset rate of return assumptions for the U.S. plans indicates a long-term rate of approximately 7.75% for the December 31, 2011, measurement date based on the long-term perspective of the investments and the historical results of investment funds.

Our analysis of the asset rate of return assumptions for the non-U.S. plans indicates a long term rate of return of approximately 5.29% based on the long-term perspective of the investments and the historical results of investment funds.

The table below sets forth the expected future pension benefit payments for the next five years and the following aggregate five-year period thereafter (in thousands):


Years	U.S.		Non-U.S.
2012	$	9,318	$	2,208
2013		9,982		2,252
2014		10,414		2,297
2015		11,158		2,343
2016		11,916		2,390
2017 through 2020		70,317		12,558

Plan Assets

U.S. plan assets consist primarily of common collective trust units, whereby the trust's assets consist of equity securities, U.S. government securities and corporate bonds, and 31,475 shares of our common stock at December 31, 2011 and 2010. The asset allocation for our U.S pension plans as of December 31, 2011 and 2010, and the target allocation, by asset category, are as follows:


U.S. Pension Plans	Target Allocation 2011			Allocation of Plan Assets at Measurement Date 2011			Target Allocation 2010			Allocation of Plan Assets at Measurement Date 2010
Equity securities		60	%		59	%		70	%		71	%
Debt securities		40	%		39	%		29	%		26	%
Other		0	%		1	%		0	%		2	%
Cash and cash equivalents		0	%		1	%		1	%		1	%

Total		100	%		100	%		100	%		100	%

Our U.S. pension obligations pay out primarily 20 to 30 years in the future. Consistent with this obligation, our investment strategy for the plan assets is to diversify risk through asset allocation and to achieve strong long-term returns. Alternative investments, classified as other in the above table, are $2.0 and $3.3 million at December 31, 2011 and 2010, respectively. They include holdings in partnerships and funds that invest in public and private debt and equity and emerging markets real estate. These investments reflect fair value, as determined by active trades, appraisals and other relevant data.

Non-U.S. plan assets consist primarily of mutual funds that invest in equity securities, government bonds and corporate bonds. Our investment strategy for the plan assets is to invest for strong long-term returns. The asset allocation for our non-U.S. pension plans as of December 31, 2011 and 2010, and the target allocation, by asset category, are as follows:


				Allocation of Plan Assets at Measurement Date
Non-U.S. Pension Plans	Target Allocation			2011			2010
Equity securities		47	%		47	%		54	%
Debt securities		48	%		48	%		45	%
Cash and cash equivalents		5	%		5	%		1	%

Total		100	%		100	%		100	%

We are required to disclose fair value measurements of pension assets and define the fair value hierarchy for valuation inputs. The hierarchy prioritized the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Our U.S. and non-U.S. pension assets are classified and disclosed in one of the three categories as defined in Note 4, Fair Value Measurements, of the Notes to the Consolidated Financial Statements.

Our Level 1 U.S. pension assets' fair values are based on quoted market prices in active markets for identical assets, which we use to value our trade securities, receivables/payables for pending sales and purchases of trade securities and other similar securities. Our Level 2 U.S. pension assets' values are based on comparable sales, such as quoted market rates for similar funds, which we use to value our private money market fund. Our Level 3 U.S. pension assets consist primarily of alternative investments held in limited partnerships and private equity funds. The values of their underlying holdings are based on third-party valuations using standard valuation methodologies.

The table below summarizes our U.S. pension assets in accordance with fair value measurement provisions for the years ended December 31, 2011 and 2010 (in thousands):

		00000000000		00000000000		00000000000		00000000000
	Level 1		Level 2		Level 3		Fair Value at December 31, 2011
Cash and cash equivalents (a)	$	-	$	2,053	$	-	$	2,053
Common collective trust units: (b)
U.S large cap equity		-		54,180		-		54,180
U.S. small/mid cap growth equity		-		6,593		-		6,593
U.S. small/mid cap value equity		-		6,843		-		6,843
Non-U.S core equity		-		15,649		-		15,649
U.S. fixed income		-		55,286		-		55,286
Limited partnerships (c)		-		-		1,032		1,032
Private equity fund (d)		-		-		1,048		1,048
U.S mid cap corporate stocks		216		-		-		216

Total investments		216		140,604		2,080		142,900
Net payable for investments purchased		-		-		-		-
Other receivables, net		-		-		-		-

Total pension assets	$	216	$	140,604	$	2,080	$	142,900

		00000000000		00000000000		00000000000		00000000000
	Level 1		Level 2		Level 3		Fair Value at December 31, 2010
Cash and cash equivalents (a)	$	-	$	861	$	-	$	861
Common collective trust units: (b)		-		-		-		-
Passive U.S large cap equity		-		45,307		-		45,307
U.S. small/mid cap growth equity		-		7,849		-		7,849
U.S. small/mid cap value equity		-		7,648		-		7,648
Non-U.S core equity		-		19,209		-		19,209
Passive U.S. core fixed income		-		35,636		-		35,636
Limited partnerships (c)		-		-		1,012		1,012
Private equity fund (d)		-		-		2,242		2,242
U.S corporate stock large cap mutual fund		14,630		-		-		14,630
U.S mid cap corporate stocks		398		-		-		398

Total investments		15,028		116,510		3,254		134,792
Net payable for investments purchased		-		-		-		-
Other receivables, net		-		-		15		15

Total pension assets	$	15,028	$	116,510	$	3,269	$	134,807

(a)	Cash and cash equivalents include cash in a money market fund managed by the Plan's trustee.

(b)	Common collective trusts managed under a Group Trust structure.

(c)	Limited partnerships include a partnership invested in distressed debt and equity issued by companies in the U.S. and a partnership invested in real estate.

(d)	The private equity fund is invested in distressed debt and equity issued by companies in the U.S.

The following table presents the changes in Level 3 investments measured at fair value for the year ended December 31, 2011 and 2010 (in thousands):


	Limited Partnerships			Private Equity Funds			Other Receivables (Payables), net			Total
Balance at December 31, 2009	$	1,089		$	2,407		$	677		$	4,173
Actual return on plan assets:
Relating to assets still held at the reporting date		14			121			(662	)		(527	)
Relating to assets sold during the period		(91	)		(286	)		-			(377	)

Balance at December 31, 2010	$	1,012		$	2,242		$	15		$	3,269

Actual return on plan assets:
Relating to assets still held at the reporting date		298			289			-			587
Relating to assets sold during the period		(278	)		(1,483	)		(15	)		(1,776	)

Balance at December 31, 2011	$	1,032		$	1,048		$	-		$	2,080

The values of the underlying holdings of the above Level 3 pension assets are not dependent upon credit and equity markets for value as their financing is from private sources. The ability to redeem certain holdings through a sale is limited at this time by general market conditions. However, this condition is expected to clear in the next year and there appears to be sufficient funding for the limited partnerships and private equity fund to continue without redemptions through several years of continued operations.

Our Level 1 non-U.S. pension assets' fair values are based on quoted market prices in active markets for identical assets, which we use to value our trade securities and cash and cash equivalents. Our Level 2 non-U.S. pension assets' fair values are based on observable input from similar assets, such as the underlying assets of the policy fund in active markets, which we use to value our unit-linked pooled policies and insurance and reinsurance contracts. We do not have any non-U.S. pension assets that require valuation using Level 3 inputs.

The table below summarizes our non-U.S. pension assets in accordance with fair value measurement provisions for the years ended December 31, 2011 and 2010 (in thousands):


	Level 1		Level 2		Level 3		Fair Value at December 31, 2011
Cash and cash equivalents	$	224	$	-	$	-	$	224
Mutual funds:
UK Equity		6,365		-		-		6,365
Emerging markets equity		5,507		-		-		5,507
US blended equity		3,814		-		-		3,814
European equity		2,373		-		-		2,373
Asia equity		1,744		-		-		1,744
UK corporate bonds		11,090		-		-		11,090
UK government bonds		6,079		-		-		6,079
Emerging markets bonds		1,973		-		-		1,973
Global government bonds		988		-		-		988
Insurance and reinsurance contracts		-		2,197		-		2,197

Total pension assets	$	40,157	$	2,197	$	-	$	42,354


	Level 1		Level 2		Level 3		Fair Value at December 31, 2010
Cash and cash equivalents	$	421	$	-	$	-	$	421
Corporate debt pooled unit funds (a)		-		18,042		-		18,042
Global corporate stock pooled unit funds (b)		-		21,478		-		21,478
Insurance and reinsurance contracts		-		1,439		-		1,439

Total pension assets	$	421	$	40,959	$	-	$	41,380

(a)	Corporate debt pooled unit fund includes units held in unit-linked pooled policies structured under U.K. securities and pension regulations. The policy managers invested in investment grade corporate debt securities issued in developed markets for the benefit of the policy.

(b)	Global corporate stock pooled unit fund includes units held in unit-linked pooled policies structured under U.K. securities and pension regulations. The policy managers invested in corporate stocks issued in markets in the U.S., U.K., European continent, Japan and other Asian countries.

There were no significant concentrations of credit risk or other types of risk in our U.S. and non-U.S. pension assets investments at December 31, 2011 and 2010.

Other Postretirement Benefits

In addition to pension benefits, certain U.S. retirees are covered by postretirement health care and life insurance benefit plans. These benefit plans are unfunded. The following table sets forth the change in benefit obligation of our other postretirement benefits and amounts recognized on our consolidated balance sheets (in thousands):


		Year Ended December 31,
	2011			2010
Change in postretirement benefit obligations:
Benefit obligation at beginning of year	$	3,313		$	4,267
Service cost		-			(898	)(a)
Interest cost		158			225
Actuarial gain		(69	)		(30	)
Benefits paid		(89	)		(251	)

Benefit obligation at end of year	$	3,313		$	3,313


Funded status	$	3,313		$	3,313
Accrued postretirement obligation	$	3,313		$	3,313

(a) Effective during the year ended December 31, 2010, an amendment to eliminate coverage for a retiree group and subsidy on prescription drugs costs resulted in an unrecognized prior service cost.

Amounts pertaining to our postretirement benefits recognized on our consolidated balance sheets are classified as follows (in thousands):


	Year Ended December 31,
	2011			2010
Current liabilities	$	(263	)	$	(462	)
Noncurrent liabilities		(3,050	)		(2,851	)

Net amount recognized	$	(3,313	)	$	(3,313	)

A summary of our net periodic postretirement cost is as follows (in thousands):


	Year Ended December 31,
	2011		2010		2009
Components of net periodic postretirement cost:
Interest cost	$	158	$	225	$	254

Net periodic postretirement cost	$	158	$	225	$	254

Actuarial assumptions used to measure the postretirement benefit obligation include a discount rate of 4.30% and 5.00% at December 31, 2011 and 2010, respectively. The weighted average discount rates used to measure net periodic benefit cost for the years ended December 31, 2011, 2010 and 2009 were 5.00%, 5.50%, and 6.40%, respectively. The assumed health care cost trend rate for fiscal year 2011 was 8.70% and is projected to decrease over seventeen years to 4.50%, where it is expected to remain thereafter. The effect of a one-percentage-point increase or decrease in the assumed health care cost trend rate on the service cost and interest cost components of the net periodic postretirement cost is not material. A one-percentage-point increase or decrease in the assumed health care cost trend rate on the postretirement benefit obligation results in an increase or decrease of approximately $0.1 million.

Estimated future gross benefit payments are $0.3 million for each of the next five years, 2012 through 2016, and $1.3 million in aggregate for the subsequent five-year period, 2017 through 2021.