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Employee Benefit Plans | 12 Months Ended
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Dec. 31, 2012
Employee Benefit Plans |
Employee Benefit Plans | 6. Employee Benefit Plans Pension Plan Prior to its termination in 2010, the Company had a non-contributory, defined benefit pension plan for all full-time employees, referred to as the tax qualified defined benefit pension plan (qualified pension plan). Plan benefits were based primarily on years of service and salary level near retirement. During the existence of the plan, the Company complied with the Employee Retirement Income Security Act (ERISA) of 1974 and Internal Revenue Code limitations when funding the plan. The Company also had an unfunded non-qualified supplemental pension plan to ensure payments to certain executive officers of amounts to which they would have been entitled under the provisions of the pension plan, but for limitations imposed by federal tax laws, referred to as the supplemental non-qualified pension arrangements (non-qualified pension plan). Termination and Amendment of Qualified and Non-Qualified Pension Plans On July 28, 2010, the Company notified its employees of its plan to terminate its qualified pension plan, with the plan and its related trust to be liquidated following appropriate filings with the Pension Benefit Guaranty Corporation and Internal Revenue Service, effective September 30, 2010. The Company then amended and restated the qualified pension plan to freeze benefit accruals, to provide for termination of the plan, to allow for an early retirement enhancement to be available to all active participants as of September 30, 2010 regardless of their age and years of service as of that date, and to make certain changes that were required or made desirable as a result of developments in the law. Because no further benefits would accrue under the qualified pension plan after September 30, 2010, the Company's related non-qualified pension plan was effectively frozen and no additional benefits were accrued under those arrangements after September 30, 2010. On March 14, 2012, the Internal Revenue Service provided the Company with a favorable determination letter for the termination of the Company's qualified pension plan. During 2012, the Company contributed $11.3 million to its qualified plan to fund the liquidation of the trust under the qualified pension plan. During 2011, the Company contributed $5.6 million to its non-qualified pension plan to fund the final distribution of benefits. As of December 31, 2012 and 2011, the benefit obligations associated with the qualified and non-qualified pension plans, respectively, were fully satisfied. Obligations and Funded Status The funded status represents the difference between the projected benefit obligation of the Company's qualified and non-qualified pension plans and the fair value of the qualified pension plan's assets at December 31. The change in the combined projected benefit obligation of the Company's qualified and non-qualified pension plans and the change in the Company's qualified pension plan assets at fair value are as follows:
|  | Year Ended December 31, |
--- | --- | --- | ---
(In thousands) |  | 2012(1) |  | 2011(2) |  | 2010 |
Change in Benefit Obligation |  |  |  |  |  |  |  |  |  |
Benefit obligation at beginning of year |  | $ | 49,618 |  | $ | 63,872 |  | $ | 75,092 |
Service cost |  |  | — |  |  | — |  |  | 2,774 |
Interest cost |  |  | 922 |  |  | 2,826 |  |  | 3,700 |
Actuarial loss |  |  | 7,444 |  |  | 11,835 |  |  | 9,265 |
Plan termination and amendment |  |  | — |  |  | — |  |  | (12,331 | )
Benefits paid |  |  | (50,969 | ) |  | (10,831 | ) |  | (14,628 | )
Annuities paid |  |  | (7,015 | ) |  | (18,084 | ) |  | — |
Benefit obligation at end of year |  |  | — |  |  | 49,618 |  |  | 63,872 |
Change in Plan Assets |  |  |  |  |  |  |  |  |  |
Fair value of plan assets at beginning of year |  |  | 44,548 |  |  | 60,078 |  |  | 53,180 |
Actual return on plan assets |  |  | 2,719 |  |  | (291 | ) |  | 7,095 |
Employer contributions |  |  | 11,251 |  |  | 14,332 |  |  | 15,416 |
Benefits paid |  |  | (50,969 | ) |  | (10,831 | ) |  | (14,628 | )
Annuities purchased |  |  | (7,015 | ) |  | (18,084 | ) |  | — |
Expenses paid |  |  | (534 | ) |  | (656 | ) |  | (985 | )
Fair value of plan assets at end of year(3) |  |  | — |  |  | 44,548 |  |  | 60,078 |
Funded status at end of year |  | $ | — |  | $ | (5,070 | ) | $ | (3,794 | )
(1) On July 13, 2012, the Company made a final distribution of benefits from the qualified pension plan. (2) On December 15, 2011, the Company made a final distribution of benefits from the non-qualified pension plan. (3) Plan assets consist of cash and investments in equity and debt securities. Cash held in the trust is classified as Level 1 in the fair value hierarchy. The fair value of investments in equity and debt securities is based on market quoted market prices where there are few transactions for the assets utilizing public information, independent external valuations from third-party pricing services or third-party advisors securities. Investments in both equity and debt securities are classified as Level 2 in the fair value hierarchy. Amounts Recognized in the Balance Sheet Amounts recognized in the balance sheet consist of the following:
|  | December 31, |
--- | --- | --- | ---
(In thousands) |  | 2012 |  | 2011 |  | 2010 |
Current liabilities |  | $ | — |  | $ | 5,070 |  | $ | 603 |
Long-term liabilities |  |  | — |  |  | — |  |  | 3,191 |
|  | $ | — |  | $ | 5,070 |  | $ | 3,794 |
Amounts Recognized in Accumulated Other Comprehensive Income Amounts recognized in accumulated other comprehensive income consist of the following:
|  | December 31, |
--- | --- | --- | ---
(In thousands) |  | 2012 |  | 2011 |  | 2010 |
Prior service cost |  | $ | — |  | $ | 221 |  | $ | 1,267 |
Net actuarial loss |  |  | — |  |  | 13,082 |  |  | 12,248 |
|  | $ | — |  | $ | 13,303 |  | $ | 13,515 |
Components of Net Periodic Benefit Cost and Other Amounts Recognized in Other Comprehensive Income—Combined Qualified and Non-Qualified Pension Plans
|  | Year Ended December 31, |
--- | --- | --- | ---
(In thousands) |  | 2012(1) |  | 2011(2) |  | 2010 |
Components of Net Periodic Benefit Cost |  |  |  |  |  |  |  |  |  |
Current year service cost |  | $ | — |  | $ | — |  | $ | 2,774 |
Interest cost |  |  | 922 |  |  | 2,826 |  |  | 3,700 |
Expected return on plan assets |  |  | (1,747 | ) |  | (4,103 | ) |  | (4,260 | )
Amortization of prior service cost |  |  | 221 |  |  | 1,046 |  |  | 572 |
Amortization of net loss |  |  | 13,082 |  |  | 10,527 |  |  | 8,705 |
Plan termination and amendment |  |  | — |  |  | — |  |  | 423 |
Settlement |  |  | 7,007 |  |  | 5,523 |  |  | 4,021 |
Net periodic pension cost |  | $ | 19,485 |  | $ | 15,819 |  | $ | 15,935 |
Other Changes in Qualified Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income |  |  |  |  |  |  |  |  |  |
Net (gain)/loss |  | $ | — |  | $ | 16,884 |  | $ | (4,523 | )
Amortization of net loss |  |  | (13,082 | ) |  | (10,527 | ) |  | (8,705 | )
Amortization of prior service cost |  |  | (221 | ) |  | (1,046 | ) |  | (572 | )
Effect of plan termination and amendment |  |  | — |  |  | — |  |  | (816 | )
Settlement |  |  | — |  |  | (5,523 | ) |  | (4,021 | )
Total recognized in other comprehensive income |  | $ | (13,303 | ) | $ | (212 | ) | $ | (18,637 | )
Total recognized in net periodic benefit cost and other comprehensive income |  | $ | 6,182 |  | $ | 15,607 |  | $ | (2,702 | )
(1) On July 13, 2012, the Company made a final distribution of benefits from the qualified pension plan. (2) On December 15, 2011, the Company made a final distribution of benefits from the non-qualified pension plan. Postretirement Benefits Other than Pensions The Company provides certain health care benefits for retired employees, including their spouses, eligible dependents and surviving spouses (retirees). These benefits are commonly called postretirement benefits. The health care plans are contributory, with participants' contributions adjusted annually. Most employees become eligible for these benefits if they meet certain age and service requirements at retirement. The Company was providing postretirement benefits to 265 retirees and their dependents at the end of 2012 and 275 retirees and their dependents at the end of 2011. Obligations and Funded Status The funded status represents the difference between the accumulated benefit obligation of the Company's postretirement plan and the fair value of plan assets at December 31. The postretirement plan does not have any plan assets; therefore, the funded status is equal to the amount of the December 31 accumulated benefit obligation. The change in the Company's postretirement benefit obligation is as follows:
|  | Year Ended December 31, |
--- | --- | --- | ---
(In thousands) |  | 2012 |  | 2011 |  | 2010 |
Change in Benefit Obligation |  |  |  |  |  |  |  |  |  |
Benefit obligation at beginning of year |  | $ | 39,969 |  | $ | 31,947 |  | $ | 34,392 |
Service cost |  |  | 1,513 |  |  | 1,403 |  |  | 1,265 |
Interest cost |  |  | 1,537 |  |  | 1,717 |  |  | 1,696 |
Actuarial (gain) / loss |  |  | (2,073 | ) |  | 6,015 |  |  | (4,415 | )
Benefits paid |  |  | (778 | ) |  | (1,113 | ) |  | (991 | )
Benefit obligation at end of year |  | $ | 40,168 |  | $ | 39,969 |  | $ | 31,947 |
Change in Plan Assets |  |  |  |  |  |  |  |  |  |
Fair value of plan assets at end of year |  |  | — |  |  | — |  |  | — |
Funded status at end of year |  | $ | (40,168 | ) | $ | (39,969 | ) | $ | (31,947 | )
Amounts Recognized in the Balance Sheet Amounts recognized in the balance sheet consist of the following:
|  | December 31, |
--- | --- | --- | ---
(In thousands) |  | 2012 |  | 2011 |  | 2010 |
Current liabilities |  | $ | 1,304 |  | $ | 1,261 |  | $ | 1,085 |
Long-term liabilities |  |  | 38,864 |  |  | 38,708 |  |  | 30,862 |
|  | $ | 40,168 |  | $ | 39,969 |  | $ | 31,947 |
Amounts Recognized in Accumulated Other Comprehensive Income Amounts recognized in accumulated other comprehensive income consist of the following:
|  | December 31, |
--- | --- | --- | ---
(In thousands) |  | 2012 |  | 2011 |  | 2010 |
Transition obligation |  | $ | — |  | $ | — |  | $ | 632 |
Net actuarial loss |  |  | 11,269 |  |  | 14,166 |  |  | 8,408 |
|  | $ | 11,269 |  | $ | 14,166 |  | $ | 9,040 |
The estimated net actuarial loss for the defined benefit postretirement plan that will be amortized from accumulated other comprehensive income into net periodic postretirement cost over the next fiscal year is $0.8 million. Components of Net Periodic Benefit Cost and Other Amounts Recognized in Other Comprehensive Income
|  | Year Ended December 31, |
--- | --- | --- | ---
(In thousands) |  | 2012 |  | 2011 |  | 2010 |
Components of Net Periodic Postretirement Benefit Cost |  |  |  |  |  |  |  |  |  |
Current year service cost |  | $ | 1,513 |  | $ | 1,403 |  | $ | 1,265 |
Interest cost |  |  | 1,537 |  |  | 1,717 |  |  | 1,696 |
Amortization of net obligation at transition |  |  | — |  |  | 632 |  |  | 632 |
Amortization of net loss |  |  | 824 |  |  | 448 |  |  | 631 |
Net periodic postretirement cost |  | $ | 3,874 |  | $ | 4,200 |  | $ | 4,224 |
Other Changes in Benefit Obligations Recognized in Other Comprehensive Income |  |  |  |  |  |  |  |  |  |
Net (gain) / loss |  | $ | (2,073 | ) | $ | 6,015 |  | $ | (4,415 | )
Amortization of net obligation at transition |  |  | — |  |  | (632 | ) |  | (632 | )
Amortization of net loss |  |  | (824 | ) |  | (448 | ) |  | (631 | )
Total recognized in other comprehensive income |  |  | (2,897 | ) |  | 4,935 |  |  | (5,678 | )
Total recognized in net periodic benefit cost and other comprehensive income |  | $ | 977 |  | $ | 9,135 |  | $ | (1,454 | )
Assumptions Assumptions used to determine projected postretirement benefit obligations and postretirement costs are as follows:
|  | December 31, |
--- | --- | --- | ---
|  | 2012 |  | 2011 |  | 2010 |
Discount rate(1) |  |  | 4.00% |  |  | 4.25% |  |  | 5.75% |
Health care cost trend rate for medical benefits assumed for next year |  |  | 7.00% |  |  | 8.00% |  |  | 9.00% |
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) |  |  | 5.00% |  |  | 5.00% |  |  | 5.00% |
Year that the rate reaches the ultimate trend rate |  |  | 2015 |  |  | 2015 |  |  | 2015 |
(1) Represents the year end rates used to determine the projected benefit obligation. To compute postretirement cost in 2012, 2011 and 2010, respectively, the beginning of year discount rates of 4.25%, 5.75% and 5.75% were used. Coverage provided to participants age 65 and older is under a fully-insured arrangement. The Company subsidy is limited to 60% of the expected annual fully- insured premium for participants age 65 and older. For all participants under age 65, the Company subsidy for all retiree medical and prescription drug benefits, beginning January 1, 2006, was limited to an aggregate annual amount not to exceed $648,000. This limit increases by 3.5% annually thereafter. The Company prepaid the life insurance premiums for all retirees retiring before January 1, 2006 eliminating all future premiums for retiree life insurance. A life insurance product is offered to employees allowing employees to continue coverage into retirement by paying the premiums directly to the life insurance provider. Assumed health care cost trend rates may have a significant effect on the amounts reported for the health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effects:
(In thousands) |  | 1-Percentage- Point Increase |  | 1-Percentage- Point Decrease |
--- | --- | --- | --- | --- | ---
Effect on total of service and interest cost |  | $ | 588 |  | $ | (470 | )
Effect on postretirement benefit obligation |  |  | 6,451 |  |  | 5,241 |
Cash Flows Contributions The Company expects to contribute approximately $1.3 million to the postretirement benefit plan in 2013. Estimated Future Benefit Payments The following estimated benefit payments under the Company's postretirement plans, which reflect expected future service, as appropriate, are expected to be paid as follows:
(In thousands) |  |  |
--- | --- | --- | ---
2013 |  | $ | 1,330 |
2014 |  |  | 1,465 |
2015 |  |  | 1,568 |
2016 |  |  | 1,665 |
2017 |  |  | 1,772 |
Years 2018 - 2022 |  |  | 11,372 |
Savings Investment Plan The Company has a Savings Investment Plan (SIP), which is a defined contribution plan. The Company matches a portion of employees' contributions in cash. Participation in the SIP is voluntary, and all regular employees of the Company are eligible to participate. The Company made contributions of $2.5 million, $2.0 million and $2.2 million in 2012, 2011 and 2010, respectively, which are included in General and administrative expense in the Consolidated Statement of Operations. The Company matches employee contributions dollar-for-dollar, up to the maximum IRS limit, on the first six percent of an employee's pretax earnings. The Company's common stock is an investment option within the SIP. In July 2010, the Company amended the SIP to provide for discretionary profit sharing contributions upon termination of the qualified pension plan effective September 30, 2010. The Company presently makes a discretionary profit- sharing contribution to this plan in an amount equal to 9% of an eligible plan participant's salary and bonus. The Company charged to expense plan contributions of $3.9 million, $3.6 million and $0.8 million in 2012, 2011 and 2010, respectively, which are included in General and administrative expense in the Consolidated Statement of Operations. Deferred Compensation Plan The Company has a Deferred Compensation Plan which is available to officers and certain members of the Company's management group and acts as a supplement to the SIP. The Internal Revenue Code does not cap the amount of compensation that may be taken into account for purposes of determining contributions to the Deferred Compensation Plan and does not impose limitations on the amount of contributions to the Deferred Compensation Plan. At the present time, the Company anticipates making a contribution to the Deferred Compensation Plan on behalf of a participant in the event that Internal Revenue Code limitations cause a participant to receive less than the Company matching contribution under the SIP. The assets of the Deferred Compensation Plan are held in a rabbi trust and are subject to additional risk of loss in the event of bankruptcy or insolvency of the Company. Under the Deferred Compensation Plan, the participants direct the deemed investment of amounts credited to their accounts. The trust assets are invested in either mutual funds that cover the investment spectrum from equity to money market, or may include holdings of the Company's common stock, which is funded by the issuance of shares to the trust. The mutual funds are publicly traded and have market prices that are readily available. Settlement payments are made to participants in cash, either in a lump sum or in periodic installments. The market value of the trust assets, excluding the Company's common stock, was $10.6 million and $10.8 million at December 31, 2012 and 2011, respectively, and is included in Other assets in the Consolidated Balance Sheet. Related liabilities, including the Company's common stock, totaled $23.9 million and $20.2 million at December 31, 2012 and 2011, respectively, and are included in Other liabilities in the Consolidated Balance Sheet. With the exception of the Company's common stock, there is no impact on earnings or earnings per share from the changes in market value of the deferred compensation plan assets because the changes in market value of the trust assets are offset completely by changes in the value of the liability, which represents trust assets belonging to plan participants. The Company's common stock held in the rabbi trust is recorded at the market value on the date of deferral, which totaled $5.7 million and $4.9 million at December 31, 2012 and 2011, respectively and is included in Additional paid-in capital in Stockholders' Equity in the Consolidated Balance Sheet. As of December 31, 2012, 267,087 shares of the Company's stock representing vested performance share awards were deferred into the rabbi trust. During 2012, the Company recognized $3.2 million in General and administrative expense in the Consolidated Statement of Operations representing the increase in the closing price of the Company's shares held in the trust. The Company's common stock issued to the trust is not considered outstanding for purposes of calculating basic earnings per share, but is considered a common stock equivalent in the calculation of diluted earnings per share. The Company charged to expense plan contributions of $661,676, $522,807 and $109,196 in 2012, 2011 and 2010, respectively, which are included in General and administrative expense in the Consolidated Statement of Operations.

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- Definition The entire disclosure for pension and other postretirement benefits. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 158 -Paragraph 7, 21, 22 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name FASB Staff Position (FSP) -Number FAS106-2 -Paragraph 20, 21, 22 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Implementation Guide (Q and A) -Number FAS88 -Paragraph 63 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 106 -Paragraph 518 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 715 -URI http://asc.fasb.org/topic&trid=2235017 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 132R -Paragraph 5, 6, 7, 8 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. 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Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Emerging Issues Task Force (EITF) -Number 03-2 -Paragraph 8 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 132R -Paragraph 5 -Subparagraph h -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 132R -Paragraph 5 -Subparagraph a -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 132R -Paragraph 5 -Subparagraph q -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. + Details
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