I. EMPLOYEE BENEFIT PLANS

The Company accounts for its employee benefit plans in accordance with ASC Topic 715 Compensation – Retirement Benefits. ASC Topic 715 requires an employer 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 under-funded 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 (with limited exceptions); and (c) recognize changes in the funded status of a defined benefit postretirement plan in the year in which the changes occur.

These amounts will be subsequently recognized as net periodic pension cost pursuant to the Company’s historical accounting policy for amortizing such amounts. Further, actuarial gains and losses that arise in subsequent periods and are not recognized as net periodic pension cost in the same periods will be recognized as a component of accumulated other comprehensive income (loss). The amortization of the unrecognized loss included in accumulated other comprehensive income (loss) and expected to be recognized in net periodic pension cost in fiscal 2016 is $852,000.

Noncontributory Pension Plan

In connection with the Casual Male acquisition, the Company assumed the assets and liabilities of the Casual Male Noncontributory Pension Plan “Casual Male Corp. Retirement Plan”, which was previously known as the J. Baker, Inc. Qualified Plan (the “Pension Plan”). Casual Male Corp. froze all future benefits under this plan on May 1, 1997.

The following table sets forth the Pension Plan’s funded status at January 30, 2016 and January 31, 2015:

	January 30, 2016			January 31, 2015
	in thousands
Change in benefit obligation:
Balance at beginning of period	$	18,927		$	15,685
Benefits and expenses paid		(668	)		(623	)
Interest costs		634			669
Settlements		(21	)		(226	)
Actuarial (gain) loss		(2,027	)		3,422

Balance at end of year	$	16,845		$	18,927

Change in fair value of plan assets
Balance at beginning of period	$	12,945		$	12,625
Actual return on plan assets		(433	)		701
Employer contributions		146			468
Settlements		(21	)		(226	)
Benefits and expenses paid		(668	)		(623	)

Balance at end of period	$	11,969		$	12,945

Reconciliation of Funded Status
Projected benefit obligation	$	16,845		$	18,927
Fair value of plan assets		11,969			12,945
Unfunded Status	$	(4,876	)	$	(5,982	)

Balance Sheet Classification
Other long-term liabilities	$	4,876		$	5,982

Total plan expense and other amounts recognized in accumulated other comprehensive loss for the years ended January 30, 2016, January 31, 2015 and February 1, 2014 include the following components:

	January 30, 2016			January 31, 2015			February 1, 2014
Net pension cost:	(in thousands)
Interest cost on projected benefit obligation	$	634		$	669		$	651
Expected return on plan assets		(1,013	)		(1,002	)		(937	)
Amortization of unrecognized loss		1,026			591			680
Net pension cost	$	647		$	258		$	394

Other changes recognized in other comprehensive loss, before taxes:
Unrecognized losses at the beginning of the year	$	9,746		$	6,614		$	7,868
Net periodic pension cost		(647	)		(258	)		(394	)
Employer contribution		146			468			421
Change in plan assets and benefit obligations		(1,106	)		2,922			(1,281	)
Unrecognized losses at the end of year	$	8,139		$	9,746		$	6,614

There is no expected contribution for fiscal 2016.

Assumptions used to determine the benefit obligations as of January 30, 2016 and January 31, 2015 include a discount rate of 4.16% for fiscal 2015 and 3.42% for fiscal 2014. Assumptions used to determine the net periodic benefit cost for the years ended January 30, 2016, January 31, 2015 and February 1, 2014 included a discount rate of 4.16% for fiscal 2015, 3.42% for fiscal 2014 and 4.43% for fiscal 2013.

The expected long-term rate of return for plan assets was assumed to be 8.00% for both fiscal 2015 and fiscal 2014. The expected long-term rate of return assumption was developed considering historical and future expectations for returns for each asset class.

Estimated Future Benefit Payments

The estimated future benefits for the next ten fiscal years are as follows:

	Total
FISCAL YEAR	(in thousands)
2016	$	740
2017		797
2018		837
2019		878
2020		964
2021-2025		5,216
	$	9,432

Plan Assets

The fair values of the Company’s noncontributory defined benefit retirement plan assets at the end of fiscal 2015 and fiscal 2014, by asset category, are as follows:

	Fair Value Measurement
	January 30, 2016								January 31, 2015
(in thousands)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
Asset category:
Common Stock	$	6,537	$	—	$	—	$	6,537	$	7,103	$	—	$	—	$	7,103
Mutual Funds:
U.S. Equity		407		—		—		407		472		—		—		472
International Equity		1,596		—		—		1,596		1,808		—		—		1,808
Bond		2,914		—		—		2,914		2,474		—		—		2,474
Cash		515		—		—		515		1,088		—		—		1,088
Total	$	11,969	$	—	$	—	$	11,969	$	12,945	$	—	$	—	$	12,945

The Company’s target asset allocation for fiscal 2016 and its asset allocation at January 30, 2016 and January 31, 2015 were as follows, by asset category:

	Target Allocation			Percentage of plan assets at
	Fiscal 2016			January 30, 2016			January 31, 2015
Asset category:
Equity securities		73.0	%		71.4	%		72.5	%
Debt securities		24.0	%		24.3	%		19.1	%
Cash		3.0	%		4.3	%		8.4	%
Total		100.0	%		100.0	%		100.0	%

The target policy is set to maximize returns with consideration to the long-term nature of the obligations and maintaining a lower level of overall volatility through the allocation of fixed income. The asset allocation is reviewed throughout the year for adherence to the target policy and is rebalanced periodically towards the target weights.

Supplemental Executive Retirement Plan

In connection with the Casual Male acquisition, the Company also assumed the liability of the Casual Male Supplemental Retirement Plan (the “SERP”).

The following table sets forth the SERP’s funded status at January 30, 2016 and January 31, 2015:

	January 30, 2016			January 31, 2015
	in thousands
Change in benefit obligation:
Balance at beginning of period	$	745		$	629
Benefits and expenses paid		(30	)		(30	)
Interest costs		25			27
Actuarial (gain) loss		(70	)		119
Balance at end of year	$	670		$	745

Change in fair value of plan assets
Balance at beginning of period	$	—		$	—
Employer contributions		30			30
Benefits and expenses paid		(30	)		(30	)
Balance at end of period	$	—		$	—

Projected benefit obligation	$	670		$	745

Reconciliation of Funded Status
Projected benefit obligation	$	670		$	745
Fair value of plan assets		—			—
Unfunded Status	$	(670	)	$	(745	)

Balance Sheet Classification
Other long-term liabilities	$	670		$	745

Other changes recognized in other comprehensive loss, before taxes (in thousands):

	January 30, 2016			January 31, 2015			February 1, 2014
Other changes recognized in other comprehensive loss, before taxes:	in thousands
Unrecognized losses at the beginning of the year	$	256		$	142		$	171
Net periodic pension cost		(34	)		(31	)		(30	)
Employer contribution		30			30			30
Change in benefit obligations		(74	)		115			(29	)
Unrecognized losses at the end of year	$	178		$	256		$	142

Assumptions used to determine the benefit obligations as of January 30, 2016 and January 31, 2015 included a discount rate of 4.16% for fiscal 2015 and 3.42% for fiscal 2014. Assumptions used to determine the net periodic benefit cost for the years ended January 30, 2016, January 31, 2015 and February 1, 2014 included a discount rate of 4.16% for fiscal 2015, 3.42% for fiscal 2014 and 4.43% for fiscal 2013.

Defined Contribution Plan

The Company has one defined contribution plan, the Destination XL Group, Inc. 401(k) Savings Plan (the “401(k) Plan”). Under the 401(k) Plan, the Company offers a qualified automatic contribution arrangement (“QACA”) with the Company matching 100% of the first 1% of deferred compensation and 50% of the next 5% (with a maximum contribution of 3.5% of eligible compensation). As of January 1, 2015, employees who are 21 years of age or older are eligible to make deferrals after 6 months of employment and are eligible to receive a Company match after one year of employment and 1,000 hours.

The Company recognized $2.0 million, $1.6 million and $1.5 million of expense under this plan in fiscal 2015, fiscal 2014 and fiscal 2013, respectively.