Derivative Instruments

12 Months Ended

Dec. 29, 2012

Derivative Instruments and Hedging Activities Disclosure [Text Block]

(8)        Derivative Instruments

We have market risk exposure to changing interest rates primarily as a result of our borrowing activities.  Our objective in managing our exposure to changes in interest rates is to reduce fluctuations in earnings and cash flows.  To achieve these objectives, from time-to-time we use derivative instruments, primarily interest rate swap agreements, to manage risk exposures when appropriate, based on market conditions.  We do not enter into derivative agreements for trading or other speculative purposes, nor are we a party to any leveraged derivative instrument.

The interest rate swap agreements are designated as cash flow hedges and are reflected at fair value in our Consolidated Balance Sheet and the related gains or losses on these contracts are deferred in stockholders’ equity as a component of other comprehensive income.  As of both December 29, 2012 and December 31, 2011, we had no outstanding interest rate swap agreements.  Deferred gains and losses are amortized as an adjustment to interest expense over the same period in which the related items being hedged are recognized in income.  However, to the extent that any of these contracts are not considered to be effective in offsetting the change in the value of the items being hedged, any changes in fair value relating to the ineffective portion of these contracts are immediately recognized in income.  Our interest rate swap agreements resulted in recognizing interest expense of $0.4 million and $1.0 million in fiscal 2011 and fiscal 2010, respectively.