PENSION PLANS

12 Months Ended

Dec. 31, 2021

Pension Plans

Pension Plan

NOTE 8 – PENSION PLANS

Defined Benefit Pension Plan

Syms sponsored a defined benefit pension plan for certain eligible employees not covered under a collective bargaining agreement. The pension plan was frozen effective December 31, 2006. At December 31, 2021 and 2020, we had recorded an overfunded pension balance of $1.6 million and $344,000, respectively, which is included in prepaid expenses and other assets, net on the accompanying consolidated balance sheets.  This overfunded asset does not include the estimated cost to us of terminating the plan in a standard termination, which would require us to make additional contributions to the plan so that the assets of the plan are sufficient to satisfy all benefit liabilities.

We currently plan to continue to maintain the Syms pension plan and make all contributions required under applicable minimum funding rules; however, we may terminate it at any time. In the event we terminate the plan, we intend that any such termination would be a standard termination. We have not taken any steps to commence such a termination and currently have no intention of terminating the pension plan.  In accordance with minimum funding requirements and court ordered allowed claims distributions, we paid approximately $5.7 million to the Syms sponsored plan from September 17, 2012 through December 31, 2021. Historically, we have funded this plan in the third quarter of the calendar year. We funded $400,000 to the Syms sponsored plan during each of the years ended December 31, 2021, 2020 and 2019, respectively.

Presented below is financial information relating to this plan for the periods indicated (dollars in thousands):

	Year Ended		Year Ended
	December 31,		December 31,
	2021		2020
CHANGE IN BENEFIT OBLIGATION:
Net benefit obligation - beginning of period	$	14,224	$	$ 13,933
Interest cost		665		658
Actuarial loss		344		408
Gross benefits paid		(925)		(775)
Net benefit obligation - end of period	$	14,308	$	14,224
CHANGE IN PLAN ASSETS:
Fair value of plan assets - beginning of period	$	14,568	$	13,009
Employer contributions		400		400
Gross benefits paid		(925)		(775)
Return on plan assets		1,897		1,934
Fair value of plan assets - end of period	$	15,940	$	14,568
Over funded status at end of period	$	1,632	$	344

The pension expense includes the following components (dollars in thousands):

	Year Ended			Year Ended			Year Ended
	December 31,			December 31,			December 31,
	2021			2020			2019
COMPONENTS OF NET PERIODIC COST:
Interest cost	$	665		$	658		$	644
Gain on assets		(842)			(758)			(628)
Amortization of loss		105			247			484
Net periodic (benefit) cost	$	(72)		$	147		$	500
WEIGHTED-AVERAGE ASSUMPTION USED:
Discount rate		5.0	%		5.0	%		5.0	%
Rate of compensation increase		0.0	%		0.0	%		0.0	%

The expected long-term rate of return on plan assets was 6% for the years ended December 31, 2021, 2020 and 2019.

As of December 31, 2021 the benefits expected to be paid in the next five years and then in the aggregate for the five fiscal years thereafter are as follows (dollars in thousands):

Year	Amount
2022	$	925
2023		974
2024		1,026
2025		1,085
2026		1,152
2027-2031		4,854

The fair values and asset allocation of our plan assets as of December 31, 2021 and 2020 and the target allocation for fiscal 2021, by asset category, are presented in the following table. All fair values are based on quoted prices in active markets for identical assets (Level 1 in the fair value hierarchy) (dollars in thousands):

			December 31, 2021				December 31, 2020
					% of Plan				% of Plan
Asset Category	Asset Allocation		Fair Value		Assets		Fair Value (1)		Assets
Cash and equivalents	0% to 10	%	$	928	6	%	$	877	6	%
Equity securities	40% to 57	%		9,678	61	%		9,755	67	%
Fixed income securities	35% to 50	%		5,334	33	%		3,936	27	%
Total			$	15,940	100	%	$	14,568	100	%

Under the provisions of ASC 715, we are required to recognize in our consolidated balance sheets the unfunded status of the benefit plan. This is measured as the difference between plan assets at fair value and the projected benefit obligation. For the pension plan, this is equal to the accumulated benefit obligation.

401(k) Plan – We have established a 401(k) plan for all of our employees. Eligible employees are able to contribute a percentage of their salary to the plan subject to statutory limits. We paid approximately $69,000, $71,000 and $67,000 in matching contributions to this plan during the years ended December 31, 2021, 2020 and 2019, respectively.