17. Benefit Plans

Pension Plans

All benefits under the primary Company-sponsored pension plan were frozen as of June 30, 2006 and no benefits have accrued to participants after this date. The Company also sponsors a pension plan for certain employees under collective bargaining agreements. Benefits under the pension plan for collectively bargained employees are determined in accordance with negotiated formulas for the respective participants. Contributions to the plans are based on actuarial determined amounts and are limited to the amounts currently deductible for income tax purposes.

In the third quarter of 2013, the Company announced a limited Lump Sum Window distribution of present valued pension benefits to terminated plan participants meeting certain criteria. The benefit election window was open during the third quarter of 2013 and benefit distributions were made during the fourth quarter of 2013. Based upon the number of plan participants electing to take the lump-sum distribution and the total amount of such distributions, the Company incurred a noncash charge of $12.0 million in the fourth quarter of 2013 when the distributions were made in accordance with the relevant accounting standards. The reduction in the number of plan participants and the reduction of plan assets will reduce the cost of administering the pension plan in the future.

The following tables set forth pertinent information for the two Company-sponsored pension plans:

Changes in Projected Benefit Obligation


	Fiscal Year
In Thousands	2013			2012
Projected benefit obligation at beginning of year	$	280,099		$	244,990
Service cost		121			105
Interest cost		12,014			12,451
Actuarial (gain)/loss		(29,862	)		29,673
Benefits paid		(43,499	)		(7,120	)
Voluntary pension settlement		7,221			0
Change in plan amendments		171			0

Projected benefit obligation at end of year	$	226,265		$	280,099

The Company recognized an actuarial gain of $54.4 million in 2013 primarily due to a change in the discount rate from 4.47% in 2012 to 5.21% in 2013. The actuarial gain, net of tax, was recorded in other comprehensive loss. The Company recognized an actuarial loss of $19.2 million in 2012 primarily due to a change in the discount rate from 5.18% in 2011 to 4.47% in 2012. The actuarial loss, net of tax, was also recorded in other comprehensive loss.

The projected benefit obligations and accumulated benefit obligations for both of the Company’s pension plans were in excess of plan assets at December 29, 2013 and December 30, 2012. The accumulated benefit obligation was $226.3 million and $280.1 million at December 29, 2013 and December 30, 2012, respectively.


Change in Plan Assets In Thousands	2013			2012
Fair value of plan assets at beginning of year	$	206,555		$	168,502
Actual return on plan assets		30,493			20,156
Employer contributions		7,275			25,017
Benefits paid		(43,499	)		(7,120	)

Fair value of plan assets at end of year	$	200,824		$	206,555

Funded Status In Thousands	Dec. 29, 2013			Dec. 30, 2012
Projected benefit obligation	$	(226,265	)	$	(280,099	)
Plan assets at fair value		200,824			206,555

Net funded status	$	(25,441	)	$	(73,544	)

Amounts Recognized in the Consolidated Balance Sheets
In Thousands	Dec. 29, 2013			Dec. 30, 2012
Current liabilities	$	0		$	0
Noncurrent liabilities		(25,441	)		(73,544	)

Net amount recognized	$	(25,441	)	$	(73,544	)


Net Periodic Pension Cost	Fiscal Year
In Thousands	2013			2012			2011
Service cost	$	121		$	105		$	96
Interest cost		12,014			12,451			12,340
Expected return on plan assets		(13,797	)		(12,462	)		(11,684	)
Loss on voluntary pension settlement		12,014			—			—
Amortization of prior service cost		28			17			18
Recognized net actuarial loss		3,027			2,822			2,130

Net periodic pension cost	$	13,407		$	2,933		$	2,900


Significant Assumptions Used	2013			2012			2011
Projected benefit obligation at the measurement date:
Discount rate		5.21	%		4.47	%		5.18	%
Weighted average rate of compensation increase		N/A			N/A			N/A
Net periodic pension cost for the fiscal year:
Discount rate		4.47	%		5.18	%		5.50	%
Weighted average expected long-term rate of return on plan assets		7.00	%		7.00	%		7.00	%
Weighted average rate of compensation increase		N/A			N/A			N/A

Cash Flows


In Thousands
Anticipated future pension benefit payments for the fiscal years:
2014	$	8,136
2015		8,628
2016		9,037
2017		9,553
2018		10,196
2019 — 2023		60,448

Anticipated contributions for the two Company-sponsored pension plans will be in the range of $4 million to $10 million in 2014.

Plan Assets

The Company’s pension plans target asset allocation for 2014, actual asset allocation at December 29, 2013 and December 30, 2012 and the expected weighted average long-term rate of return by asset category were as follows:


	Target Allocation 2014			Percentage of Plan Assets at Fiscal Year- End						Weighted Average Expected Long-Term Rate of Return - 2013
	Target Allocation 2014			2013			2012
U.S. large capitalization equity securities		40	%		40	%		42	%		3.5	%
U.S. small/mid-capitalization equity securities		5	%		5	%		4	%		0.4	%
International equity securities		15	%		15	%		11	%		1.4	%
Debt securities		40	%		40	%		43	%		1.7	%

Total		100	%		100	%		100	%		7.0	%

All of the assets in the Company’s pension plans include investments in institutional investment funds managed by professional investment advisors which hold U.S. equities, international equities and debt securities. The objective of the Company’s investment philosophy is to earn the plans’ targeted rate of return over longer periods without assuming excess investment risk. The general guidelines for plan investments include 30% - 50% in large capitalization equity securities, 0% — 20% in U.S. small and mid-capitalization equity securities, 0% - 20% in international equity securities and 10% — 50% in debt securities. The Company currently has 60% of its plan investments in equity securities and 40% in debt securities.

U.S. large capitalization equity securities include domestic based companies that are generally included in common market indices such as the S&P 500™ and the Russell 1000™. U.S. small and mid-capitalization equity securities include small domestic equities as represented by the Russell 2000™ index. International equity securities include companies from developed markets outside of the United States. Debt securities at December 29, 2013 are comprised of investments in two institutional bond funds with a weighted average duration of approximately three years.

The weighted average expected long-term rate of return of plan assets of 7% was used in determining net periodic pension cost in both 2013 and 2012. This rate reflects an estimate of long-term future returns for the pension plan assets. This estimate is primarily a function of the asset classes (equities versus fixed income) in which the pension plan assets are invested and the analysis of past performance of these asset classes over a long period of time. This analysis includes expected long-term inflation and the risk premiums associated with equity investments and fixed income investments.

The following table summarizes the Company’s pension plan assets measured at fair value on a recurring basis (at least annually) at December 29, 2013:


In Thousands	Quoted Prices in Active Market for Identical Assets (Level 1)		Significant Other Observable Input (Level 2)		Total
Cash equivalents(1)
Common/collective trust funds	$	0	$	196	$	196
Equity securities
Common/collective trust funds(2)		0		120,044		120,044
Other		624		0		624
Fixed income
Common/collective trust funds(2)		0		79,960		79,960

Total	$	624	$	200,200	$	200,824

(1)	Cash equivalents are valued at their net asset value which approximates fair value.

(2)	The underlying investments held in common/collective trust funds are actively managed equity securities and fixed income investment vehicles that are valued at the net asset value per share multiplied by the number of shares held as of the measurement date.

The following table summarizes the Company’s pension plan assets measured at fair value on a recurring basis (at least annually) at December 30, 2012:


In Thousands	Quoted Prices in Active Market for Identical Assets (Level 1)		Significant Other Observable Input (Level 2)		Total
Cash equivalents(1)
Common/collective trust funds	$	0	$	461	$	461
Equity securities(2)
U.S. large capitalization		13,414		0		13,414
U.S. mid-capitalization		1,789		0		1,789
International		1,548		0		1,548
Common/collective trust funds(3)		0		99,399		99,399
Other		606		0		606
Fixed income
Common/collective trust funds(3)		0		89,338		89,338

Total	$	17,357	$	189,198	$	206,555

(1)	Cash equivalents are valued at their net asset value which approximates fair value.

(2)	Equity securities other than common/collective trust funds consist primarily of common stock. Investments in common stocks are valued using quoted market prices multiplied by the number of shares owned.

(3)	The underlying investments held in common/collective trust funds are actively managed equity securities and fixed income investment vehicles that are valued at the net asset value per share multiplied by the number of shares held as of the measurement date.

The Company does not have any unobservable inputs (Level 3) pension plan assets.

401(k) Savings Plan

The Company provides a 401(k) Savings Plan for substantially all of its employees who are not part of collective bargaining agreements.

The Company matched the first 5% of participants’ contributions for 2011.

During the first quarter of 2012, the Company changed the Company’s matching contribution from fixed to discretionary maintaining the option to make matching contributions for eligible participants of up to 5% based on the Company’s financial results for 2012 and future years. The 5% matching contribution was accrued during 2013 and 2012. Based on the Company’s financial results, the Company decided to make matching contributions of 5% of participants’ contributions for the years of 2013 and 2012. The Company made these contribution payments for 2013 and 2012 in the first quarter of 2014 and 2013, respectively.

The total expense for this benefit was $8.3 million, $8.2 million and $8.5 million in 2013, 2012 and 2011, respectively.

Postretirement Benefits

The Company provides postretirement benefits for a portion of its current employees. The Company recognizes the cost of postretirement benefits, which consist principally of medical benefits, during employees’ periods of active service. The Company does not pre-fund these benefits and has the right to modify or terminate certain of these benefits in the future.

The following tables set forth a reconciliation of the beginning and ending balances of the benefit obligation, a reconciliation of the beginning and ending balances of the fair value of plan assets and funded status of the Company’s postretirement benefit plan:


	Fiscal Year
In Thousands	2013			2012
Benefit obligation at beginning of year	$	69,828		$	64,696
Service cost		1,626			1,256
Interest cost		2,877			2,981
Plan participants’ contributions		569			584
Actuarial (gain)/loss		(3,560	)		4,287
Benefits paid		(3,611	)		(4,030	)
Medicare Part D subsidy reimbursement		111			54

Benefit obligation at end of year	$	67,840		$	69,828


Fair value of plan assets at beginning of year	$	0		$	0
Employer contributions		2,931			3,392
Plan participants’ contributions		569			584
Benefits paid		(3,611	)		(4,030	)
Medicare Part D subsidy reimbursement		111			54

Fair value of plan assets at end of year	$	0		$	0


In Thousands	Dec. 29, 2013			Dec. 30, 2012
Current liabilities	$	(2,682	)	$	(2,653	)
Noncurrent liabilities		(65,158	)		(67,175	)

Accrued liability at end of year	$	(67,840	)	$	(69,828	)

The components of net periodic postretirement benefit cost were as follows:


	Fiscal Year
In Thousands	2013			2012			2011
Service cost	$	1,626		$	1,256		$	961
Interest cost		2,877			2,981			2,926
Amortization of unrecognized transitional assets		0			0			(18	)
Recognized net actuarial loss		2,943			2,339			2,345
Amortization of prior service cost		(1,513	)		(1,513	)		(1,717	)

Net periodic postretirement benefit cost	$	5,933		$	5,063		$	4,497

Significant Assumptions Used	2013			2012			2011
Benefit obligation at the measurement date:
Discount rate		4.96	%		4.11	%		4.94	%
Net periodic postretirement benefit cost for the fiscal year:
Discount rate		4.11	%		4.94	%		5.25	%

The weighted average health care cost trend used in measuring the postretirement benefit expense in 2013 was 8.00% graded down to an ultimate rate of 5.00% by 2019. The weighted average health care cost trend used in measuring the postretirement benefit expense in 2012 was 8.5% graded down to an ultimate rate of 5% by 2019. The weighted average health care cost trend used in measuring the postretirement benefit expense in 2011 was 10% graded down to an ultimate rate of 5% by 2016.

A 1% increase or decrease in this annual health care cost trend would have impacted the postretirement benefit obligation and service cost and interest cost of the Company’s postretirement benefit plan as follows:


In Thousands	1% Increase		1% Decrease
Increase (decrease) in:
Postretirement benefit obligation at December 29, 2013	$	7,830	$	(7,168	)
Service cost and interest cost in 2013		578		(533	)

Cash Flows


In Thousands
Anticipated future postretirement benefit payments reflecting expected future service for the fiscal years:
2014	$	2,682
2015		2,934
2016		3,249
2017		3,622
2018		4,117
2019 — 2023		25,369

Anticipated future postretirement benefit payments are shown net of Medicare Part D subsidy reimbursements, which are not material.

The amounts in accumulated other comprehensive loss that have not yet been recognized as components of net periodic benefit cost at December 30, 2012, the activity during 2013, and the balances at December 29, 2013 are as follows:


In Thousands	Dec. 30, 2012			Actuarial Gain (Loss)			Reclassification Adjustments			Dec. 29, 2013
Pension Plans:
Actuarial (loss)	$	(126,165	)	$	39,337		$	15,041		$	(71,787	)
Prior service (cost) credit		(56	)		(171	)		28			(199	)
Postretirement Medical:
Actuarial (loss)		(37,771	)		3,560			2,943			(31,268	)
Prior service (cost) credit		7,187			0			(1,513	)		5,674

	$	(156,805	)	$	42,726		$	16,499		$	(97,580	)

The amounts in accumulated other comprehensive loss that are expected to be recognized as components of net periodic cost during 2014 are as follows:


In Thousands	Pension Plans		Postretirement Medical			Total
Actuarial loss	$	1,685	$	2,250		$	3,935
Prior service cost (credit)		36		(1,510	)		(1,474	)

	$	1,721	$	740		$	2,461

Multi-Employer Benefits

The Company currently participates in one multi-employer defined benefit pension plan covering certain employees whose employment is covered under collective bargaining agreements. The risks of participating in this multi-employer plan are different from single-employer plans in that assets contributed are pooled and may be used to provide benefits to employees of other participating employers. If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. If the Company chooses to stop participating in the multi-employer plan, the Company could be required to pay the plan a withdrawal liability based on the underfunded status of the plan. The Company stopped participation in one multi-employer defined pension plan in 2008. See below for additional information.

The Company’s participation in the plan is outlined in the table below. The most recent Pension Protection Act (“PPA”) zone status available in 2013 and 2012 is for the plan’s years ending at December 31, 2012 and 2011, respectively. The plan is in the green zone which represents at least 80% funded and does not require a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”).

Pension Protection
Act Zone Status

FIP/RP Status
Pending/
Implemented

Contribution
(In Thousands)

Surcharge
Imposed

Pension Fund

2013

2012

2013

2012

2011

Employer-Teamsters Local Nos. 175 & 505 Pension Trust Fund (EIN/Pension Plan
No. 55-6021850)

Green

640

606

555

For the plan year ended December 31, 2012, 2011 and 2010, respectively, the Company was not listed in Employer-Teamsters Local Nos. 175 & 505 Pension Trust Fund Forms 5500 as providing more than 5% of the total contributions for the plan. At the date these financial statements were issued, Forms 5500 were not available for the plan year ending December 31, 2013.

The collective bargaining agreements covering the Employer-Teamsters Local Nos. 175 & 505 Pension Trust Fund will expire on April 27, 2014 and July 26, 2015.

The Company currently has a liability to a multi-employer pension plan related to the Company’s exit from the plan in 2008. As of December 29, 2013, the Company had a liability of $9.3 million recorded. The Company is required to make payments of approximately $1 million each year through 2028 to this multi-employer pension plan.

The Company also made contributions of $0.4 million, $0.3 million and $0.3 million to multi-employer defined contribution plans in 2013, 2012 and 2011, respectively.