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RETIREMENT AND DEFERRED COMPENSATION PLANS
 12 Months Ended
Dec. 31, 2013
RETIREMENT AND DEFERRED COMPENSATION PLANS  
RETIREMENT AND DEFERRED COMPENSATION PLANS

NOTE 8 RETIREMENT AND DEFERRED COMPENSATION PLANS

 The Company has various noncontributory retirement plans covering certain of its domestic and foreign employees. Benefits under the Company's retirement plans are based on participants' years of service and annual compensation as defined by each plan. Annual cash contributions to fund pension costs accrued under the Company's domestic plans are generally at least equal to the minimum funding amounts required by the Employee Retirement Income Security Act of 1974, as amended (ERISA). Certain pension commitments under its foreign plans are also funded according to local requirements or at the Company's discretion.

        The following table presents the changes in the benefit obligations and plan assets for the most recent two years for the Company's domestic and foreign plans.

   
 
       
    
    
    
  
 
   Domestic Plans   Foreign Plans  
 
   2013
   2012
   2013
   2012
  

Change in benefit obligation:

                          

Benefit obligation at beginning of year

   $ 136,321   $ 111,947   $ 80,610   $ 48,754  

Service cost

     8,539     7,217     3,901     2,244  

Interest cost

     4,992     4,913     2,676     2,658  

Business acquired

     —     —     —     9,148  

Curtailment/Settlement

     —     —     (1,342 )   —  

Actuarial (gain) loss

     (14,260 )   18,743     (1,752 )   17,905  

Benefits paid

     (6,144 )   (6,499 )   (2,952 )   (2,075 )

Foreign currency translation adjustment

     —     —     3,519     1,976  
               

Benefit obligation at end of year

   $ 129,448   $ 136,321   $ 84,660   $ 80,610  
                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​


 

 
   Domestic Plans   Foreign Plans  
 
   2013
   2012
   2013
   2012
  

Change in plan assets:

                          

Fair value of plan assets at beginning of year

   $ 84,587   $ 68,537   $ 47,876   $ 39,835  

Actual return on plan assets

     12,063     8,342     1,742     1,547  

Employer contribution

     10,061     14,207     5,419     7,381  

Business acquired

     —     —     —     389  

Benefits paid

     (6,144 )   (6,499 )   (2,952 )   (2,075 )

Foreign currency translation adjustment

     —     —     1,990     799  
               

Fair value of plan assets at end of year

   $ 100,567   $ 84,587   $ 54,075   $ 47,876  
                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Funded status at end of year

   $ (28,881 ) $ (51,734 ) $ (30,585 ) $ (32,734 )

        The following table presents the funded status amounts recognized in the Company's Consolidated Balance Sheets as of December 31, 2013 and 2012.

 
   Domestic Plans   Foreign Plans  
 
   2013
   2012
   2013
   2012
  

Current liabilities

   $ (809 ) $ (369 ) $ —   $ (1,187 )

Non-current liabilities

     (28,072 )   (51,365 )   (30,585 )   (31,547 )
                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

 

   $ (28,881 ) $ (51,734 ) $ (30,585 ) $ (32,734 )
                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

        The following table presents the amounts not recognized as components of periodic benefit cost that are recognized in accumulated other comprehensive loss as of December 31, 2013 and 2012.

 
   Domestic Plans   Foreign Plans  
 
   2013
   2012
   2013
   2012
  

Net actuarial loss

   $ 32,930   $ 58,580   $ 24,844   $ 29,265  

Net prior service cost

     —     3     3,784     4,157  

Tax effects

     (12,349 )   (21,969 )   (9,116 )   (10,788 )
                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

 

   $ 20,581   $ 36,614   $ 19,512   $ 22,634  
                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

        Changes in benefit obligations and plan assets recognized in other comprehensive income in 2013 are as follows:

 
   Domestic Plans   Foreign Plans  

Current year actuarial gain

   $ 20,548   $ 3,005  

Amortization of net loss

     5,103     1,416  

Amortization of prior service cost

     3     373  
           
​ ​ ​ ​ ​ ​ ​ ​

 

   $ 25,654   $ 4,794  
           
​ ​ ​ ​ ​ ​ ​ ​

        The following table presents the amounts in accumulated other comprehensive loss as of December 31, 2013 expected to be recognized as components of periodic benefit cost in 2014.

 
   Domestic Plans   Foreign Plans  

Amortization of net loss

   $ 2,787   $ 1,255  

Amortization of prior service cost

     —     324  
           
​ ​ ​ ​ ​ ​ ​ ​

 

   $ 2,787   $ 1,579  
           
​ ​ ​ ​ ​ ​ ​ ​

Components of net periodic benefit cost:

   
 
       
    
    
  
 
   Domestic Plans  
 
   2013
   2012
   2011
  

Service cost

   $ 8,539   $ 7,217   $ 5,436  

Interest cost

     4,992     4,913     4,504  

Expected return on plan assets

     (5,775 )   (5,604 )   (4,790 )

Amortization of net loss

     5,103     3,854     1,652  

Amortization of prior service cost

     3     4     4  
           

Net periodic benefit cost

   $ 12,862   $ 10,384   $ 6,806  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Curtailment

     —     —     —  

Total Net periodic benefit cost

   $ 12,862   $ 10,384   $ 6,806  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​


 

 
   Foreign Plans  
 
   2013
   2012
   2011
  

Service cost

   $ 3,901   $ 2,244   $ 2,018  

Interest cost

     2,676     2,658     2,518  

Expected return on plan assets

     (1,821 )   (1,538 )   (1,753 )

Amortization of net loss

     1,416     475     836  

Amortization of prior service cost

     373     361     455  
           

Net periodic benefit cost

   $ 6,545   $ 4,200   $ 4,074  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

Curtailment

     1     —     —  

Total Net periodic benefit cost

   $ 6,546   $ 4,200   $ 4,074  
               
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

        The accumulated benefit obligation ("ABO") for the Company's domestic defined benefit pension plans was $114.6 million and $118.8 million at December 31, 2013 and 2012, respectively. The accumulated benefit obligation for the Company's foreign defined benefit pension plans was $67.0 million and $63.6 million at December 31, 2013 and 2012, respectively.

        The following table provides the projected benefit obligation ("PBO"), ABO, and fair value of plan assets for all pension plans with an ABO in excess of plan assets as of December 31, 2013 and 2012.

 
   Domestic Plans   Foreign Plans  
 
   2013
   2012
   2013
   2012
  

Projected benefit obligation

   $ 129,448   $ 136,321   $ 77,475   $ 77,663  

Accumulated benefit obligation

     114,592     118,804     60,707     60,703  

Fair value of plan assets

     100,567     84,587     47,753     44,930  

        The following table provides the PBO, ABO, and fair value of plan assets for all pension plans with a PBO in excess of plan assets as of December 31, 2013 and 2012.

 
   Domestic Plans   Foreign Plans  
 
   2013
   2012
   2013
   2012
  

Projected benefit obligation

   $ 129,448   $ 136,321   $ 81,158   $ 77,663  

Accumulated benefit obligation

     114,592     118,804     63,527     60,703  

Fair value of plan assets

     100,567     84,587     50,573     44,930  

Assumptions:

   
 
       
    
    
    
    
    
  
 
   Domestic Plans   Foreign Plans  
 
   2013
   2012
   2011
   2013
   2012
   2011
  
 
  

Weighted-average assumptions used to determine benefit obligations at December 31:

                                      

Discount rate

     4.75%     3.80%     N/A     3.24%     3.19%     N/A  

Rate of compensation increase

     4.00%     4.00%     N/A     3.00%     3.00%     N/A  

Weighted-average assumptions used to determine net periodic benefit cost for years ended December 31:

    
 		    
 		    
 		    
 		    
 		    
 		  

Discount rate

     3.80%     4.40%     5.40%     3.19%     5.10%     5.15%  

Expected long-term return on plan assets

     7.00%     7.00%     7.00%     3.79%     3.83%     4.40%  

Rate of compensation increase

     4.00%     4.00%     4.00%     3.00%     3.00%     3.00%  

        The Company develops the expected long-term rate of return assumptions based on historical experience and by evaluating input from the plans' asset managers, including the managers' review of asset class return expectations and benchmarks, economic indicators and long-term inflation assumptions.

        In order to determine the 2014 net periodic benefit cost, the Company expects to use the December 31, 2013 discount rates, December 31, 2013 rates of compensation increase assumptions and the same assumed long-term returns on domestic and foreign plan assets used for the 2013 net periodic benefit cost.

        The Company's domestic and foreign pension plan weighted-average asset allocations at December 31, 2013 and 2012 by asset category are as follows:

Plan Assets:

   
    
  
 
   Domestic Plans Assets
at December 31,		   Foreign Plans Assets
at December 31,		  
 
   2013
   2012
   2013
   2012
  
 
       
    
    
    
  

Equity securities

     59%     60%     5%     1%  

Fixed income securities

     24%     30%     16%     6%  

Infrastructure

     8%     10%     —     —  

Money market

     9%     —     1%     12%  

Investment Funds

     —     —     78%     81%  
               

Total

     100%     100%     100%     100%  
                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​

        The Company's investment strategy for its domestic and foreign pension plans is to maximize the long-term rate of return on plan assets within an acceptable level of risk. The investment policy strives to have assets sufficiently diversified so that adverse or unexpected results from one security type will not have an unduly detrimental impact on the entire portfolio and accordingly, establishes a target allocation for each asset category within the portfolio. The domestic plan asset allocation is reviewed on a quarterly basis and the foreign plan asset allocation is reviewed annually. Rebalancing occurs as needed to comply with the investment strategy. The domestic plan target allocation for 2014 is 60% equity securities and 40% fixed income securities and infrastructure. The foreign plan target allocation for 2014 is 96% investment funds, and 4% money market.

        Authoritative guidelines require the categorization of assets and liabilities into three levels based upon the assumptions (inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment. The three levels are defined as follows:

•
Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities.
•
Level 2: Observable inputs other than those included in Level 1. For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets.
•
Level 3: Unobservable inputs reflecting management's own assumptions about the inputs used in pricing the asset or liability.

 
   Domestic Fair Value Measurement
at December 31, 2013		   Foreign Fair Value Measurement
at December 31, 2013		  
(In Thousands $)
   Total
   (Level 1)
   (Level 2)
   (Level 3)
   Total
   (Level 1)
   (Level 2)
   (Level 3)
  

Cash and Short Term Securities (a)

   $ 9,070   $ 9,070   $ —   $ —   $ 757   $ 757   $ —   $ —  

USD

     —     9,070     —     —     —     —     —     —  

EUR

     —     —     —     —     —     757     —     —  

Equity Securities (a)

   $ 49,261   $ 49,261     —     —   $ 2,547   $ 2,547     —     —  

US Large Cap Equities

     —     20,159     —     —     —     —     —     —  

US Small Cap Equities

     —     14,521     —     —     —     —     —     —  

International Equities

     —     14,581     —     —     —     2,547     —     —  

Core Fixed Income (a)

   $ 23,918   $ 23,918     —     —     1,950     1,950     —     —  

Corporate debts securities

     —     —     —     —   $ 6,560   $ 6,560     —     —  

Euro Corporate Bonds (a)

     —     —     —     —     —     6,560     —     —  

Hedge Fund (c)

   $ 9,731     —     —   $ 9,731     —     —     —     —  

Investment Funds

     —     —     —     —   $ 42,261   $ 15,501   $ 26,760     —  

Mutual Funds in Equities (a)

     —     —     —     —     —     3,628     —     —  

Mutual Funds in Bonds (a)

     —     —     —     —     —     10,040     —     —  

Mutual Funds Diversified (a &b)

     —     —     —     —     —     1,833     26,760     —  

Infrastructure (c)

   $ 8,587     —     —   $ 8,587     —     —     —     —  
                               

Total Investments

   $ 100,567   $ 82,249   $ —   $ 18,318   $ 54,075   $ 27,315   $ 26,760   $ —  
                                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​


 

 
   Domestic Fair Value Measurement
at December 31, 2012		   Foreign Fair Value Measurement
at December 31, 2012		  
(In Thousands $)
   Total
   (Level 1)
   (Level 2)
   (Level 3)
   Total
   (Level 1)
   (Level 2)
   (Level 3)
  

Cash and Short Term Securities (a)

   $ 887   $ 887   $ —   $ —   $ 5,560   $ 5,560   $ —   $ —  

USD

     —     887     —     —     —     —     —     —  

EUR

     —     —     —     —     —     5,560     —     —  

Equity Securities (a)

   $ 42,523   $ 42,523     —     —   $ 655   $ 655     —     —  

US Large Cap Equities

     —     17,142     —     —     —     —     —     —  

US Small Cap Equities

     —     12,523     —     —     —     —     —     —  

International Equities

     —     12,858     —     —     —     655     —     —  

Core Fixed Income (a)

   $ 24,587   $ 24,587     —     —   $ 728     728     —     —  

Corporate debts securities

     —     —     —     —   $ 2,084   $ 2,084     —     —  

Euro Corporate Bonds (a)

     —     —     —     —     —     2,084     —     —  

Hedge Fund (c)

   $ 8,575     —     —   $ 8,575     —     —     —     —  

Investment Funds

     —     —     —     —   $ 38,849   $ 17,622   $ 21,227     —  

Mutual Funds in Equities (a)

     —     —     —     —     —     5,873     —     —  

Mutual Funds in Bonds (a)

     —     —     —     —     —     2,458     —     —  

Mutual Funds Diversified (a &b)

     —     —     —     —     —     9,291     21,227     —  

Infrastructure (c)

   $ 8,015     —     —   $ 8,015     —     —     —     —  
                               

Total Investments

   $ 84,587   $ 67,997   $ —   $ 16,590   $ 47,876   $ 26,649   $ 21,227   $ —  
                                   
​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​
(a)
Based on third party quotation from financial institution.
(b)
Based on observable market transactions.
(c)
Based on a quarterly statement prepared by the fund manager that reflects contributions, distributions and realized/unrealized gains and losses.

        The following table sets forth a summary of changes in fair value of the pension plan investments classified as Level 3 for the year ended December 31, 2013.

   
   Infrastructure Fund
   Hedge Fund
  
   
  
 

Balance, 12/31/11

   $ 5,670   $ 7,497  
 

Purchases, sales and settlements, net

     1,800     1,000  
 

Return on assets held

     696     78  
 

Admin fees and other

     (151 )   —  
             
  ​ ​ ​ ​ ​ ​ ​ ​
 

Balance, 12/31/12

   $ 8,015   $ 8,575  
             
  ​ ​ ​ ​ ​ ​ ​ ​
 

Return on assets held

     725     1,156  
 

Admin fees and other

     (153 )   —  
             
  ​ ​ ​ ​ ​ ​ ​ ​
 

Balance, 12/31/13

   $ 8,587   $ 9,731  
             
  ​ ​ ​ ​ ​ ​ ​ ​

CONTRIBUTIONS

 Annual cash contributions to fund pension costs accrued under the Company's domestic plans are generally at least equal to the minimum funding amounts required by ERISA. The Company contributed $10.1 million to its domestic defined benefit plans in 2013 and although the Company has no minimum funding requirement, we plan to contribute approximately $10.0 million in 2014. Contributions to fund pension costs accrued under the Company's foreign plans are made in accordance with local laws or at the Company's discretion. The Company contributed approximately $5.4 million to its foreign defined benefit plan in 2013 and expects to contribute approximately $5.6 million in 2014.

ESTIMATED FUTURE BENEFIT PAYMENTS

 As of December 31, 2013, the Company expects the plans to make the following estimated benefit payments relating to its defined benefit plans over the next ten years:

   
 
       
    
  
 
   Domestic Plans
   Foreign Plans
  

2014

   $ 7,579   $ 2,529  

2015

     7,351     2,133  

2016

     7,744     2,678  

2017

     10,174     3,146  

2018

     9,569     3,825  

2019 – 2023

     55,864     24,731  

OTHER PLANS

 The Company has a non-qualified supplemental pension plan for domestic employees which provides for pension amounts that would have been payable from the Company's principal domestic pension plan if it were not for limitations imposed by income tax regulations. The liability for this plan, which is not funded, was $6.5 million and $6.4 million at December 31, 2013 and 2012, respectively. This amount is included in the liability for domestic plans shown above.

        The Company has a defined contribution 401(k) employee savings plan available to substantially all domestic employees. Company matching contributions are made in cash up to a maximum of 3% of the participating employee's salary subject to income tax regulations. For each of the years ended December 31, 2013, 2012 and 2011, total contributions made by the Company to these plans were approximately $2.6 million, $2.6 million and $2.4 million, respectively.

        The Company has several foreign defined contribution plans, which require the Company to contribute a percentage of the participating employee's salary according to local regulations. For each of the years ended December 31, 2013, 2012 and 2011, total contributions made by the Company to these plans were approximately $2.1 million, $1.8 million and $1.9 million, respectively.

        The Company has no additional postretirement or postemployment benefit plans.