Employee Benefit Plans

General Cable provides retirement benefits through contributory and noncontributory qualified and non-qualified defined benefit pension plans covering eligible domestic and international employees as well as through defined contribution plans and other postretirement benefits.

Defined Benefit Pension Plans

Benefits under General Cable’s qualified U.S. defined benefit pension plan generally are based on years of service multiplied by a specific fixed dollar amount, and benefits under the Company’s qualified non-U.S. defined benefit pension plans generally are based on years of service and a variety of other factors that can include a specific fixed dollar amount or a percentage of either current salary or average salary over a specific period of time. The amounts funded for any plan year for the qualified U.S. defined benefit pension plan are neither less than the minimum required under federal law or more than the maximum amount deductible for federal income tax purposes. General Cable’s non-qualified unfunded U.S. defined benefit pension plans include a plan that provides defined benefits to select senior management employees beyond those benefits provided by other programs. The Company’s non-qualified unfunded non-U.S. defined benefit pension plans include plans that provide retirement indemnities and other post-retirement payments to employees within the Company’s European and ROW segments. Pension obligations for the majority of non-qualified unfunded defined benefit pension plans are provided for by book reserves and are based on local practices and regulations of the respective countries. General Cable makes cash contributions for the costs of the non-qualified unfunded defined benefit pension plans as the benefits are paid.

The changes in the benefit obligation and plan assets, the funded status of the plans and the amounts recognized in the Consolidated Balance Sheets are as follows (in millions):



	U.S. Plans						Non-U.S. Plans
	Dec 31, 2011			Dec 31, 2010			Dec 31, 2011			Dec 31, 2010
Changes in Benefit Obligation:
Beginning benefit obligation	$	152.6		$	143.2		$	107.5		$	99.5
Impact of foreign currency exchange rate change	—			—			(2.8		)	(0.9		)
Service cost	1.4			1.4			3.1			2.7
Interest cost	8.1			8.3			5.7			5.6
Curtailment (gain) loss	—			—			—			(1.8		)
Settlement (gain) loss	—			—			(1.4		)	(1.0		)
Benefits paid	(9.8		)	(10.0		)	(4.9		)	(6.3		)
Employee contributions	—			—			0.1			0.1
Amendments / Change in assumptions	0.7			0.4			4.1			2.4
Actuarial (gain) loss	14.2			9.3			2.8			7.2
Ending benefit obligation	$	167.2		$	152.6		$	114.2		$	107.5
Changes in Plan Assets:
Beginning fair value of plan assets	$	123.6		$	110.0		$	36.9		$	29.3
Impact of foreign currency exchange rate change	—			—			(0.7		)	0.9
Actual return on plan assets	(4.7		)	13.6			3.3			2.1
Company contributions	17.5			10.0			6.9			10.9
Settlements	—			—			(1.4		)	—
Benefits paid	(9.8		)	(10.0		)	(4.9		)	(6.3		)
Ending fair value of plan assets	$	126.6		$	123.6		$	40.1		$	36.9
Funded status at end of year	$	(40.6	)	$	(29.0	)	$	(74.1	)	$	(70.6	)
Amounts Recognized in Consolidated Balance Sheets:
Other Assets	$	—		$	—		$	7.5		$	5.0
Accrued liabilities	$	(0.4	)	$	(0.4	)	$	(4.3	)	$	(3.4	)
Other liabilities	$	(40.2	)	$	(28.6	)	$	(77.3	)	$	(72.2	)
Recognized in Accumulated Other Comprehensive Income:
Net actuarial loss	$	84.9		$	60.2		$	15.1		$	13.2
Prior service cost	0.6			0.4			6.8			3.2
Transition obligation	—			—			0.6			0.8
	$	85.5		$	60.6		$	22.5		$	17.2

The accumulated benefit obligation for US defined benefit retirement pension plans was $166.6 million and $152.3 million for 2011 and 2010, respectively. The accumulated benefit obligation for Non-US defined benefit retirement pension plans was $102.3 million and $95.3 million for 2011 and 2010, respectively. Pension plans with accumulated benefit obligations in excess of plan assets consist of the following (in millions):



	U.S. Plans				Non-U.S. Plans
	Dec 31, 2011		Dec 31, 2010		Dec 31, 2011		Dec 31, 2010
Projected benefit obligation	$	167.2	$	152.6	$	104.5	$	98.7
Accumulated benefit obligation	166.6		152.3		93.4		87.2
Fair value of the plan assets	126.6		123.5		23.1		23.2

Pension expense included the following components (in millions):



	U.S. Plans Year ended									Non-U.S. Plans Year ended
	Dec 31, 2011			Dec 31, 2010			Dec 31, 2009			Dec 31, 2011			Dec 31, 2010			Dec 31, 2009
Pension expense:
Service cost	$	1.4		$	1.4		$	1.5		$	3.1		$	2.7		$	2.6
Interest cost	8.1			8.3			8.2			5.7			5.6			5.7
Expected return on plan assets	(10.6		)	(9.2		)	(7.5		)	(2.4		)	(2.0		)	(1.7		)
Amortization of prior service cost	0.1			0.1			0.5			0.3			0.2			0.1
Amortization of net loss	5.1			4.8			7.4			1.2			0.5			0.4
Amortization of transition obligation	—			—			—			0.2			0.2			0.1
Curtailment (gain) loss	—			—			—			—			(1.8		)	(1.0		)
Settlement (gain) loss	—			—			—			0.3			0.3			—
Net pension expense	$	4.1		$	5.4		$	10.1		$	8.4		$	5.7		$	6.2

The estimated net loss for the defined benefit pension plans that will be amortized from accumulated other comprehensive income into net pension expense over the next fiscal year is $10.8 million. The prior service cost to be amortized from accumulated other comprehensive income into net pension expense over the next fiscal year is immaterial.

General Cable evaluates its actuarial assumptions at least annually, and adjusts them as necessary. The Company uses a measurement date of December 31 for all of its defined benefit pension plans. The weighted average assumptions used in determining benefit obligations were:



	U.S. Plans				Non-U.S. Plans
	Dec 31, 2011		Dec 31, 2010		Dec 31, 2011		Dec 31, 2010
Discount rate	4.70	%	5.50	%	5.20	%	5.40	%
Expected rate of increase in future compensation levels	2.00	%	2.00	%	4.40	%	3.80	%

The weighted average assumptions used to determine net pension expense were:



	U.S. Plans						Non-U.S. Plans
	Dec 31, 2011		Dec 31, 2010		Dec 31, 2009		Dec 31, 2011		Dec 31, 2010		Dec 31, 2009
Discount rate	5.40	%	6.00	%	5.75	%	5.60	%	6.20	%	6.28	%
Expected rate of increase in future compensation levels	2.00	%	2.00	%	2.50	%	4.30	%	5.50	%	4.44	%
Long-term expected rate of return on plan assets	8.50	%	8.50	%	8.50	%	7.20	%	6.90	%	7.06	%

Pension expense for the defined benefit pension plans sponsored by General Cable is determined based principally upon certain actuarial assumptions, including the discount rate and the expected long-term rate of return on assets. The discount rates for the U.S. defined benefit pension plans were determined based on a review of long-term bonds that receive one of the two highest ratings given by a recognized rating agency which are expected to be available during the period to maturity of the projected pension benefit obligations and based on information received from actuaries. Non-U.S. defined benefit pension plans followed a similar evaluation process based on financial markets in those countries where General Cable provides a defined benefit pension plan.

The weighted-average long-term expected rate of return on assets is based on input from actuaries, including their review of historical 10-year, 20-year, and 25-year rates of inflation and real rates of return on various broad equity and bond indices in conjunction with the diversification of the asset portfolio. The Company’s overall investment strategy is to diversify its investments for the qualified U.S. defined benefit pension plan based on an asset allocation assumption of 65% allocated to equity investments, with an expected real rate of return of 8%, and 35% to fixed-income investments, with an expected real rate of return of 2%, and an assumed long-term rate of inflation of 3%. Equity investments primarily include investments in large-cap and mid-cap companies primarily located in the United States. The actual asset allocations were 66% of equity investments and 34% of fixed-income investments at December 31, 2011 and 68% of equity investments and 32%% of fixed-income investments at December 31, 2010. Approximately 29% and 27% of plan assets were concentrated in two mutual funds as of December 31, 2011 and 2010, respectively. The expected long-term rate of return on assets for qualified non-U.S. defined benefit plans is based on a weighted-average asset allocation assumption of 35% allocated to equity investments, 63% to fixed-income investments and 2% to other investments. The actual weighted-average asset allocations were 35% of equity investments, 64% of fixed-income investments and 1% of other investments at December 31, 2011 and 47% of equity investments, 51% of fixed-income investments and 2% of other investments at December 31, 2010. Management believes that long-term asset allocations on average and by location will approximate the Company’s assumptions and that the long-term rate of return used by each country that is included in the weighted-average long-term expected rate of return on assets is a reasonable assumption.

The fair value of the Company’s pension plan assets at December 31, 2011 by asset category are as follows (in millions):



			Quoted prices in Active Markets for Identical		Significant Observable		Significant Unobservable
Asset Category	Total		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
Equity Securities	$	81.3	$	81.0	$	0.3	$	—
Mutual Funds	50.7		36.3		14.4		—
Short Term Investments	3.3		—		3.3		—
Equitable Contract	1.4		—		1.4		—
Fixed Income	25.6		—		25.6		—
Coal Lease ⁽¹⁾	4.4		—		—		4.4
Total	$	166.7	$	117.3	$	45.0	$	4.4

The fair value of the Company’s pension plan assets at December 31, 2010 by asset category are as follows (in millions):



			Quoted prices in Active Markets for Identical		Significant Observable		Significant Unobservable
Asset Category	Total		Assets (Level 1)		Inputs (Level 2)		Inputs (Level 3)
Equity Securities	$	82.5	$	82.1	$	0.4	$	—
Mutual Funds	69.6		33.0		36.6		—
Short Term Investments	2.3		—		2.3		—
Equitable Contract	1.5		—		1.5		—
Fixed Income	—		—		—		—
Coal Lease ⁽¹⁾	4.6		—		—		4.6
Total	$	160.5	$	115.1	$	40.8	$	4.6


(1)	The Company’s interest represents approximately 26% of the lease which is currently between American Premier Underwriters (APU), the Lessor and CONSOL Energy (CONSOL), the Lessee. The lease pertains to real property mined by CONSOL located in Pennsylvania.

The following table represents details of the fair value measurements using significant unobservable inputs (Level 3):



	Coal Lease
Beginning balance at January 1, 2010	$	4.6
Change in fair value of plan assets	—
Purchases, sales, transfers, and settlements	—
Ending balance December 31, 2010	$	4.6
Change in fair value of plan assets	(0.2		)
Purchases, sales, transfers, and settlements	—
Ending balance at December 31, 2011	$	4.4

The determination of pension expense for the qualified defined benefit pension plans is based on the fair market value of assets as of the measurement date. Investment gains and losses are recognized in the measurement of assets immediately. Such gains and losses will be amortized and recognized as part of the annual benefit cost to the extent that unrecognized net gains and losses from all sources exceed 10% of the greater of the projected benefit obligation or the market value of assets.

General Cable’s expense under both U.S. and non-U.S. defined benefit pension plans is determined using the discount rate as of the beginning of the fiscal year, so 2012 expense for the pension plans will be based on the weighted-average discount rate of 4.7% for U.S. defined benefit pension plans and 5.2% for non-U.S. defined benefit pension plans.

The Company expects to contribute, at a minimum, $9.0 million to its defined benefit pension plans for 2012. The estimated future benefit payments expected to be paid for the Company’s defined benefit pension plans are $16.0 million in 2012, $16.6 million in 2013, $16.8 million in 2014, $17.6 million in 2015, $17.5 million in 2016 and $92 million in 2017 and thereafter.

Postretirement Benefits Other Than Pensions

General Cable has postretirement benefit plans that provide medical and life insurance for certain retirees and eligible dependents. General Cable funds the plans as claims or insurance premiums are incurred. The changes in accrued postretirement benefits were as follows (in millions):



	Dec 31, 2011			Dec 31, 2010
Changes in Benefit Obligation:
Beginning benefit obligation	$	8.0		$	9.3
Service cost	0.1			0.1
Interest cost	0.3			0.4
Actuarial loss	(0.4		)	(1.0		)
Benefits paid	(0.9		)	(0.9		)
Foreign currency impact	—			0.1
Ending benefit obligation	$	7.1		$	8.0
Funded status at end of year	$	(7.1	)	$	(8.0	)
Amounts Recognized in Consolidated Balance Sheets:
Accrued liabilities	$	(1.0	)	$	(1.2	)
Other liabilities	$	(6.1	)	$	(6.8	)
Recognized in Accumulated Other Comprehensive Income:
Net actuarial loss	$	1.1		$	1.6
Prior service cost	(0.3		)	(0.3		)
	$	0.8		$	1.3

Net postretirement benefit expense included the following components (in millions):



	Year ended
	Dec 31, 2011			Dec 31, 2010			Dec 31, 2009
Postretirement benefit expense:
Service cost	$	0.1		$	0.1		$	0.1
Interest cost	0.3			0.4			0.5
Amortization of prior service cost	(0.1		)	(0.1		)	(0.1		)
Amortization of net loss	0.1			0.1			0.2
Net postretirement benefit expense	$	0.4		$	0.5		$	0.7

The estimated net (gain) loss and prior service cost for the postretirement benefit plans that will be amortized from accumulated other comprehensive income into net postretirement benefit expense over the next fiscal year will be immaterial in the coming year.

The discount rate used in determining the accumulated postretirement benefit obligation was 3.50% for the year ended December 31, 2011, 4.25% for the year ended December 31, 2010 and 4.75% for the year ended December 31, 2009. The discount rate used in determining the net postretirement benefit expense was 4.25% for the year ended December 31, 2011, 4.75% for the year ended December 31, 2010 and 5.50% for the year ended December 31, 2009. The assumed health-care cost trend rate used in measuring the accumulated postretirement benefit obligation in 2011 was 8.50% decreasing gradually to 4.50% in year 2019 and thereafter, in 2010 was 8.50%, decreasing gradually to 4.50% in year 2019 and thereafter and in 2009 was 9.00% decreasing gradually to 4.50% in year 2019 and thereafter. Increasing the assumed health-care cost trend rate by 1% would result in an increase in the accumulated postretirement benefit obligation of $0.3 million for 2011. The effect of this change would increase net postretirement benefit expense by less than $0.1 million. Decreasing the assumed health-care cost trend rate by 1% would result in a decrease in the accumulated postretirement benefit obligation of $0.3 million for 2011. The effect of this change would decrease net postretirement benefit expense by less than $0.1 million.

The estimated future benefit payments expected to be paid for the Company’s postretirement benefits other than pensions are $1.0 million in 2012, $1.0 million in 2013, $0.8 million in 2014, $0.7 million in 2015, $0.6 million in 2016 and $2.8 million in 2017 and thereafter.

Defined Contribution Plans

Expense under both U.S. and non-U.S. defined contribution plans generally equals up to six percent of each eligible employee’s covered compensation based on the location and status of the employee. The net defined contribution plan expense recognized was $9.3 million, $8.6 million and $8.4 million, respectively, for the years ended December 31, 2011, 2010 and 2009.