Pension Plan

The Company sponsors an unfunded non-qualified defined benefit plan (“SERP”) for certain senior executives. The Company accounts for the SERP in accordance with applicable guidance which requires the Company to (a) recognize in its statement of financial position an asset for a plan’s over funded status or a liability for a plan’s underfunded status; (b) measure a plan’s assets and its obligations that determine its funded status as of the end of the employer’s fiscal year; and (c) recognize changes in the funded status of a defined benefit post-retirement plan in the year in which the changes occur. The plan assets and benefit obligations are measured as of the Company’s fiscal year end. No assets are held with respect to the SERP, therefore benefits are funded as paid to participants.

For the years ended December 31, 2011, 2010 and 2009, the Company recorded $0.5 million, $0.5 million and $2.4 million, respectively for the expenses related to the SERP which are included in SG&A expense in the accompanying consolidated statements of income.

The following table presents the components of net periodic benefit costs for the three years ended December 31, 2011:



	Years ended December 31,
	2011			2010			2009
	(In thousands)
Components of net periodic pension cost:
Service cost	$	—		$	—		$	404
Interest cost	541			538			591
Amortization
Prior service cost	—			—			230
Loss	—			—			—
	541			538			1,225
Curtailment	—			—			1,209
Net periodic pension cost	$	541		$	538		$	2,434
Weighted average assumptions:
Discount rate	4.50		%	5.50		%	6.00		%

Curtailment

During the fourth quarter of 2009, the Company amended the terms of the SERP to freeze participant benefits effective December 31, 2009. The amendment of the plan terms constituted a significant event and required the Company to recognize a curtailment loss as part of its 2009 net periodic pension cost. The curtailment loss was equal to unrecognized prior service costs for all employees which totaled approximately $2.3 million The curtailment loss was partially offset by a $1.1 million gain related to the elimination of future participant salary increases for vested participants as well as the removal of liabilities for non-vested participants. These items resulted in a net curtailment loss of $1.2 million for the year ended December 31, 2009.

The following is a reconciliation of the changes in the projected benefit obligation for the years ended December 31, 2011 and 2010:



	December 31,
	2011			2010
	(In thousands)
Projected benefit obligation, beginning of year	$	10,034		$	9,176
Interest cost	541			538
Actuarial loss (gain)	1,735			734
Benefit payments	(414		)	(414		)
Projected benefit obligation, end of year	$	11,896		$	10,034

The amounts in accumulated other comprehensive income (loss) that have not yet been recognized as components of net periodic benefit costs at December 31, 2011 are as follows:



	(In thousands)
Transition asset (obligation)	$	—
Prior service cost	—
Accumulated loss	2,375
Total	$	2,375

The net periodic pension costs for the year ended December 31, 2012 reflect the 2009 amendment of the SERP which froze participant benefits. As a result of freezing the benefits, future service cost and unrecognized prior service cost amortizations have been eliminated. The components of projected net periodic pension cost for the year ended December 31, 2012 are as follows:



	(In thousands)
Service cost	$	—
Interest cost	526
Amortization	—
Prior service cost	—
Loss	128
Net periodic benefit cost	$	654

The SERP projected benefit obligation was included as a liability in the current and long-term deferred compensation and retirement plan obligations in the accompanying consolidated balance sheets totaling $11.9 million and $10.0 million at December 31, 2011 and 2010, respectively. The accumulated benefit obligation at December 31, 2011 and 2010 was equal to the projected benefit obligation due to the 2009 amendment which froze participant benefits under the SERP.

On December 26, 2011, the Company's board of directors approved the termination of the SERP effective immediately. The Company will effectuate the termination of the SERP through the payment of lump sum distributions to all SERP participants based upon the actuarial equivalent commuted lump sum value of the full accrued benefit earned by each such participant, using actuarial and other assumptions that have not yet been determined. The Company expects to complete the settlement of the plan benefits prior to December 31, 2012. Based on the assumptions chosen to calculate the lump sum value of distributions, the actual settlement of the SERP liability may differ from the Company's current estimate of the projected benefit obligation resulting in a settlement gain or loss in 2012.

Expected benefit payments at December 31, 2011 for the next five years and the five years thereafter are as follows:



Year	(In thousands)
2012	$	11,896
2013	—
2014	—
2015	—
2016	—
Five years or more	—