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EMPLOYEE BENEFIT PLANS
 12 Months Ended
Dec. 29, 2012
Compensation and Retirement Disclosure [Abstract]  
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS
Defined Benefit Plans - As of December 29, 2012, the Company maintained two domestic pension plans and three German pension plans. The Company used a December 29 measurement date for these plans.

Effective for 2012, the Company redesigned certain retirement plan offerings. The redesign was completed in order to increase standardization of retirement plans among U.S. salaried employees and to reduce the expected cash funding volatility of retirement plans, while at the same time keeping in place a competitive retirement plan offering to attract and retain talent. The Company achieved this by freezing both the Basic Pension Plan and the Cash Balance Plan as of December 31, 2011, with the exception of a certain limited number of Basic Pension Plan participants who will still accrue benefits over a five year sunset period. Also effective December 31, 2011, the Cash Balance Plan was closed (the Basic Pension Plan was previously closed) and the two plans were merged into a single plan. The portion of the non-qualified pension plan related to the Cash Balance Plan was also frozen. As of January 1, 2012, the Company instituted new service-based contributions, supplemental to the existing Company match for employees, into the defined contribution retirement plan offering.

The following table sets forth aggregated information related to the Company’s pension benefits and other postretirement benefits, including changes in the benefit obligations, changes in plan assets, funded status, amounts recognized in the balance sheet, amounts recognized in other accumulated comprehensive income, and actuarial assumptions that the Company considered in its determination of benefit obligations and plan costs. Benefit obligation balances presented below reflect the projected benefit obligation (PBO) for our pension plans, and accumulated postretirement benefit obligations (APBO) for our other benefit plans.
(In millions)
 
Pension Benefits
 
Other Benefits
 
 
2012
 
2011
 
2012
 
2011
Accumulated benefit obligation, end of year
 
$
191.4

 
$
173.2

 
$
14.5

 
$
13.4

 
 
 
 
 
 
 
 
 
Change in benefit obligation:
 
 

 
 

 
 

 
 

Benefit obligation, beginning of year
 
$
176.6

 
$
171.8

 
$
13.4

 
$
12.5

Service cost
 
1.5

 
3.5

 
0.1

 
0.1

Interest cost
 
8.2

 
8.7

 
0.6

 
0.6

Plan amendments
 
—

 
—

 
0.8

 
1.2

Actuarial loss
 
20.5

 
9.8

 
1.2

 
0.2

Settlements paid
 
(0.3
)
 
(0.6
)
 
—

 
—

Benefits paid
 
(10.6
)
 
(12.0
)
 
(1.6
)
 
(1.2
)
Liability gain due to curtailment**
 
—

 
(4.3
)
 
—

 
—

Foreign currency exchange
 
0.4

 
(0.3
)
 
—

 
—

Benefit obligation, end of year
 
$
196.3

 
$
176.6

 
$
14.5

 
$
13.4

 
 
 
 
 
 
 
 
 
Change in plan assets:
 
 
 
 
 
 
 
 
Fair value of assets, beginning of year
 
$
120.0

 
$
116.0

 
$
—

 
$
—

Actual return on plan assets
 
14.2

 
0.3

 
—

 
—

Company contributions
 
6.7

 
16.4

 
1.6

 
1.2

Settlements paid
 
(0.3
)
 
(0.6
)
 
—

 
—

Benefits paid
 
(10.6
)
 
(12.0
)
 
(1.6
)
 
(1.2
)
Foreign currency exchange
 
0.2

 
(0.1
)
 
—

 
—

Plan assets, end of year
 
$
130.2

 
$
120.0

 
$
—

 
$
—

 
 
 
 
 
 
 
 
 
Funded status
 
$
(66.1
)
 
$
(56.6
)
 
$
(14.5
)
 
$
(13.4
)
 
 
 
 
 
 
 
 
 
Amounts recognized in balance sheet:
 
 

 
 

 
 

 
 

Deferred tax asset
 
32.2

 
26.9

 
1.9

 
1.3

Current liabilities
 
(0.1
)
 
(0.1
)
 
(1.5
)
 
(1.1
)
Noncurrent liabilities
 
(66.0
)
 
(56.5
)
 
(13.0
)
 
(12.3
)
Net liability, end of year
 
$
(33.9
)
 
$
(29.7
)
 
$
(12.6
)
 
$
(12.1
)
 
 
 
 
 
 
 
 
 
Amount recognized in accumulated other comprehensive income:
 
 

 
 

 
 

 
 

Net transition obligation
 
$
—

 
$
—

 
$
—

 
$
0.1

Prior service cost
 
—

 
—

 
1.2

 
0.9

Net actuarial loss
 
53.9

 
44.9

 
1.7

 
1.2

Total recognized in accumulated other comprehensive income
 
$
53.9

 
$
44.9

 
$
2.9

 
$
2.2


**   These items for 2011 related primarily to the benefit plan redesign.






The following table sets forth other changes in plan assets and benefit obligation recognized in other comprehensive income for 2012 and 2011:

(In millions)
 
Pension Benefits
 
Other Benefits
 
 
2012
 
2011
 
2012
 
2011
Net actuarial loss
 
$
16.5

 
$
16.1

 
$
1.2

 
$
0.3

Prior service cost
 
—

 
—

 
0.8

 
1.2

Amortization of:
 
 

 
 

 
 

 
 

Net actuarial gain
 
(1.9
)
 
(3.0
)
 
(0.1
)
 
—

Prior service credit
 
—

 
(0.2
)
 
(0.3
)
 
(0.1
)
Settlement recognition
 
(0.1
)
 
—

 
—

 
—

Transition asset
 
—

 
—

 
(0.2
)
 
(0.2
)
Deferred tax asset
 
(5.5
)
 
(5.0
)
 
(0.7
)
 
(0.5
)
Total recognized in other comprehensive income
 
$
9.0

 
$
7.9

 
$
0.7

 
$
0.7



Assumptions used to determine domestic benefit obligations:

 
 
Pension Benefits
 
Other Benefits
 
 
2012
 
2011
 
2012
 
2011
Discount rate
 
4.00
%
 
4.75
%
 
3.50
%
 
4.50
%
Rate of increase in future compensation*
 
—
%
 
3.00 - 12.00%
(Graded)

 
3.00 - 12.00%
(Graded)

 
3.00 - 12.00%
(Graded)


*No rate of increases in future compensation used within assumptions for 2012, as both Pension Plans were frozen effective December 31, 2011.

Assumptions used to determine domestic periodic benefit cost:

 
 
Pension Benefits
 
Other Benefits
 
 
2012
 
2011
 
2012
 
2011
Discount rate
 
4.75
%
 
5.25
%
 
4.50
%
 
5.00
%
Rate of increase in future compensation
 
—
%
 
3.00 - 12.00%
(Graded)

 
3.00 - 12.00%
(Graded)

 
3.00 - 12.00%
(Graded)

Expected long-term rate of return on plan assets
 
8.00
%
 
8.25
%
 
—
%
 
—
%


The accumulated benefit obligation for the Company’s tax qualified plan and German benefit pension plans was $181.0 million and $165.2 million for the years ended 2012 and 2011.

The following table sets forth the aggregated net periodic benefit cost for all pension plans for 2012, 2011, and 2010:

(In millions)
Pension Benefits
 
Other Benefits
 
2012
 
2011
 
2010
 
2012
 
2011
 
2010
Service cost
$
1.5

 
$
3.5

 
$
2.9

 
$
0.1

 
$
0.1

 
$
0.1

Interest cost
8.2

 
8.7

 
8.9

 
0.6

 
0.6

 
0.7

Expected return on assets
(10.1
)
 
(10.8
)
 
(10.2
)
 
—

 
—

 
—

Amortization of transition obligation
—

 
—

 
—

 
0.2

 
0.1

 
0.2

Prior service cost
—

 
0.1

 
0.2

 
0.3

 
0.1

 
—

Loss
2.0

 
3.0

 
1.8

 
0.1

 
—

 
—

Net periodic benefit cost
$
1.6

 
$
4.5

 
$
3.6

 
$
1.3

 
$
0.9

 
$
1.0

Curtailment**
—

 
0.1

 
0.8

 
—

 
—

 
0.2

Settlement cost
—

 
—

 
0.3

 
—

 
—

 
—

Total net periodic benefit cost
$
1.6

 
$
4.6

 
$
4.7

 
$
1.3

 
$
0.9

 
$
1.2


**   These items for 2011 related primarily to the benefit plan redesign.

The estimated net actuarial (gain)/loss, prior service cost/(credit), and transition (asset)/obligation that will be amortized from accumulated other comprehensive income into net periodic benefit cost during the 2013 fiscal year are $3.5 million, $0.0 million, and $0.0 million, respectively, for the pension plans and $0.2 million, $0.4 million, and $0.0 million respectively, for all other benefits.

The Company has consulted with a third party investment manager for the assets of the funded domestic defined benefit plan.  The plan assets are currently invested primarily in pooled funds, where each fund in turn is composed of mutual funds that have at least daily net asset valuations. Thus the Company’s funded domestic defined benefit plan assets are invested in a “fund of funds” approach.

The Company’s Board has delegated oversight and guidance to an appointed Employee Benefits Committee.  The Committee has the tasks of reviewing plan performance and asset allocation; ensuring plan compliance with applicable laws; establishing plan policies, procedures, and controls; monitoring expenses; and other related activities.

The plans’ investment policies and strategies focus on the ability to fund benefit obligations as they come due.  Considerations include the plan's current funded level, plan design, benefit payment assumptions, funding regulations, impact of potentially volatile business results on the Company’s ability to make certain levels of contributions, and interest rate and asset return volatility among other considerations. The Company currently attempts to maintain plan funded status at approximately 80 percent or greater pursuant to the Pension Protection Act of 2006. Given the plan’s current funded status, the Company’s cash on hand, cash historically generated from business operations, and cash available under committed credit facilities, the Company sees ample liquidity to achieve this goal.

Risk management and continuous monitoring requirements are met through monthly investment portfolio reports, quarterly Employee Benefits Committee meetings, annual valuations,  asset/liability studies, and the annual assumption process focusing primarily on the return on asset assumption and the discount rate assumption.  As of December 29, 2012, funds were invested in equity, fixed income, and other investments as follows:

Equity
 
Percentage
U.S. Large Cap
 
42
%
World Equity ex-U.S.
 
17
%
U.S. Small / Mid Cap
 
7
%
Subtotal
 
66
%
 
 
 
Fixed Income
 
 
U.S. Core Fixed Income                                       
 
13
%
Long Duration Bond Fund
 
10
%
High Yield Fixed Income                                     
 
3
%
Emerging Markets Debt                                     
 
3
%
Subtotal
 
29
%
 
 
 
Other
 
 
Insurance Contracts                                              
 
4
%
Cash Equivalents
 
1
%
Subtotal
 
5
%
Total
 
100
%


The Company does not see any particular concentration of risk within the plans, nor any plan assets that pose difficulties for fair value assessment. The Company currently has no allocation to potentially illiquid or potentially difficult to value assets such as hedge funds, venture capital, private equity, and real estate.

The Company works with actuaries and consultants in making its determination of the asset rate of return assumption and also the discount rate assumption. 

Asset class assumptions are set using a combination of empirical and forward-looking analysis for long-term rate of return on plan assets.  A variety of models are applied for filtering historical data and isolating the fundamental characteristics of asset classes.  These models provide empirical return estimates for each asset class, which are then reviewed and combined with a qualitative assessment of long-term relationships between asset classes before a return estimate is finalized.  This provides an additional means for correcting for the effect of unrealistic or unsustainable short-term valuations or trends, opting instead for return levels and behavior that is more likely to prevail over long periods.  With that, the Company has assumed an expected long-term rate of return on plan assets of 8.00 percent for the 2013 net periodic benefit cost.  This is the result of stochastic modeling showing the 50th percentile median return at or above 8.00 percent.
 
The Company uses the Aon Hewitt AA Above Median curve to determine the discount rate.  All cash flow obligations under the plan are matched to bonds in the Aon Hewitt universe of liquid, high-quality, non-callable / non-putable corporate bonds with outliers removed.  From that matching exercise, a discount rate is determined.

The Company’s German pension plans are funded by insurance contract policies whereby the insurance company guarantees a fixed minimum return.  Due to tax legislation, individual pension benefits can only be financed using direct insurance policies up to certain maximums.  These maximum amounts in respect of each member are paid into such an arrangement on a yearly basis.
 
The Company designated the domestic plan assets as Level 1, as they are mutual funds with prices that are readily available.  The German plan assets are designated as Level 2 inputs as the fair value of the insurance contracts is measured by the reserve that is supervised by the German Federal Financial Supervisory Authority.

The fair values of the Company’s pension plan assets for 2012 and 2011 by asset category are as follows:

(In millions)
 
2012
 
Quoted Prices in Active Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable
 Inputs
(Level 3)
Equity
 
 
 
 
 
 
 
 
U.S. Large Cap
 
$
55.2

 
$
55.2

 
$
—

 
$
—

U.S. Small / Mid Cap
 
9.2

 
9.2

 
—

 
—

World Equity ex-U.S.
 
21.9

 
21.9

 
—

 
—

Fixed Income
 
 
 
 
 
 
 
 
U.S. Core Fixed Income
 
16.4

 
16.4

 
—

 
—

Long Duration Bond
 
12.5

 
12.5

 
—

 
—

High Yield Fixed Income
 
4.2

 
4.2

 
—

 
—

Emerging Markets Debt
 
4.0

 
4.0

 
—

 
—

Other
 
 
 
 
 
 
 
 
Insurance Contracts
 
5.7

 
—

 
5.7

 
—

Cash and Equivalents
 
1.1

 
1.1

 
—

 
—

Total
 
$
130.2

 
$
124.5

 
$
5.7

 
$
—


(In millions)
 
2011
 
Quoted Prices in Active Markets for Identical Assets
(Level 1)
 
Significant Other Observable Inputs
(Level 2)
 
Significant Unobservable
 Inputs
(Level 3)
Equity
 
 
 
 
 
 
 
 
U.S. Large Cap
 
$
49.8

 
$
49.8

 
$
—

 
$
—

U.S. Small / Mid Cap
 
8.5

 
8.5

 
—

 
—

World Equity ex-U.S.
 
17.4

 
17.4

 
—

 
—

Fixed Income
 
 
 
 
 
 
 
 
U.S. Core Fixed Income
 
20.7

 
20.7

 
—

 
—

Long Duration Bond
 
9.5

 
9.5

 
—

 
—

High Yield Fixed Income
 
3.8

 
3.8

 
—

 
—

Emerging Markets Debt
 
3.6

 
3.6

 
—

 
—

Other
 
 
 
 
 
 
 
 
Insurance Contracts
 
5.3

 
—

 
5.3

 
—

Cash and Equivalents
 
1.4

 
1.4

 
—

 
—

Total
 
$
120.0

 
$
114.7

 
$
5.3

 
$
—




One of the Company’s domestic pension plans covers only certain management employees. The Company does not fund this plan, and its assets were zero in both 2012 and 2011. The plan’s projected benefit obligation and accumulated benefit obligation were $11.8 million and $10.4 million, respectively, for 2012, and $8.8 million and $8.0 million, respectively, for 2011.

The Company estimates total contributions to the plans of $9.2 million in 2013.

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:

(In millions)
 
Pension
 Benefits
 
Other
 Benefits
2013
 
$
11.0

 
$
1.5

2014
 
13.8

 
1.4

2015
 
14.1

 
1.3

2016
 
13.9

 
1.2

2017
 
11.0

 
1.1

Years 2018 through 2022
 
57.0

 
4.5



The Company’s other postretirement benefit plans provide health and life insurance benefits to domestic employees hired prior to 1992. The Company effectively capped its cost for those benefits through plan amendments made in 1992, freezing Company contributions for insurance benefits at 1991 levels for current and future beneficiaries with actuarially reduced benefits for employees who retire before age 65.

Defined Contribution Plans - The Company maintained a 401(k) Plan during 2012 and 2011. The Company's cash contributions are allocated to participants' accounts based on investment elections.

The following table sets forth Company contributions to the 401(k) Plan:

(In millions)
 
2012
 
2011
 
2010
Company contributions to the plan
 
$
5.0

 
$
1.9

 
$
1.7