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EMPLOYEE BENEFIT PLANS | 12 Months Ended
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Dec. 30, 2012
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Defined Contribution and Deferred Compensation Plans The Company has a 401(k) retirement investment plan (“401(k) Plan”), which is open to all otherwise eligible U.S. employees with at least six months of service. The 401(k) Plan calls for Company matching contributions on a sliding scale based on the level of the employee’s contribution. The Company may, at its discretion, make additional contributions to the 401(k) Plan based on the attainment of certain performance targets by its subsidiaries. The Company’s matching contributions are funded bi-monthly and totaled approximately $2.4 million, $2.1 million and $1.9 million for the years 2012, 2011 and 2010, respectively, for continuing operations. No discretionary contributions were made in 2012, 2011 or 2010. Under the Company’s nonqualified savings plans (“NSPs”), the Company provides eligible employees the opportunity to enter into agreements for the deferral of a specified percentage of their compensation, as defined in the NSPs. The NSPs call for Company matching contributions on a sliding scale based on the level of the employee’s contribution. The obligations of the Company under such agreements to pay the deferred compensation in the future in accordance with the terms of the NSPs are unsecured general obligations of the Company. Participants have no right, interest or claim in the assets of the Company, except as unsecured general creditors. The Company has established a rabbi trust to hold, invest and reinvest deferrals and contributions under the NSPs. If a change in control of the Company occurs, as defined in the NSPs, the Company will contribute an amount to the rabbi trust sufficient to pay the obligation owed to each participant. Deferred compensation in connection with the NSPs totaled $18.3 million at December 30, 2012. The Company invested the deferrals in insurance instruments with readily determinable cash surrender values. Foreign Defined Benefit Plans The Company has trusteed defined benefit retirement plans which cover many of its European employees. The benefits are generally based on years of service and the employee’s average monthly compensation. Pension expense was $0.8 million, $0.3 million and $1.8 million for the years 2012, 2011 and 2010, respectively. Plan assets are primarily invested in equity and fixed income securities. The Company uses a year-end measurement date for the plans. As of December 30, 2012, for the European plans, the Company had a net liability recorded of $2.6 million, an amount equal to their unfunded status, and has recorded in Other Comprehensive Income an amount equal to $31.5 million (net of taxes) related to the future amounts to be recorded in net post-retirement benefit costs. The tables presented below set forth the funded status of the Company’s significant foreign defined benefit plans and required disclosures in accordance with applicable accounting standards
|  | FISCAL YEAR |
|  | 2012 |  |  | 2011 |
|  | (in thousands) |
Change in benefit obligation |  |  |  |  |  |  |  |
Benefit obligation, beginning of year |  | $ | 216,721 |  |  | $ | 212,378 |
Service cost |  |  | 505 |  |  |  | 469 |
Interest cost |  |  | 10,212 |  |  |  | 11,386 |
Benefits and expenses paid |  |  | (9,969 | ) |  |  | (11,641 | )
Actuarial loss (gain) |  |  | 17,538 |  |  |  | 5,224 |
Member contributions |  |  | 296 |  |  |  | 375 |
Currency translation adjustment |  |  | 8,346 |  |  |  | (1,470 | )
Benefit obligation, end of year |  | $ | 243,649 |  |  | $ | 216,721 |
|  | FISCAL YEAR |
|  | 2012 |  |  | 2011 |
|  | (in thousands) |
Change in plan assets |  |  |  |  |  |  |  |
Plan assets, beginning of year |  | $ | 206,402 |  |  | $ | 205,810 |
Actual return on assets |  |  | 31,204 |  |  |  | 8,769 |
Company contributions |  |  | 5,248 |  |  |  | 5,112 |
Member contributions |  |  | 0 |  |  |  | 0 |
Benefits paid |  |  | (9,704 | ) |  |  | (11,697 | )
Currency translation adjustment |  |  | 7,877 |  |  |  | (1,592 | )
Plan assets, end of year |  | $ | 241,027 |  |  | $ | 206,402 |
Reconciliation to balance sheet |  |  |  |  |  |  |  |
Funded status (benefit liability) |  | $ | (2,622 | ) |  | $ | (10,319 | )
Net amount recognized |  | $ | (2,622 | ) |  | $ | (10,319 | )
Amounts recognized in accumulated other comprehensive income (after tax) |  |  |  |  |  |  |  |
Unrecognized actuarial loss |  | $ | 30,711 |  |  | $ | 32,455 |
Unamortized prior service costs |  |  | 774 |  |  |  | 809 |
Total amount recognized |  | $ | 31,485 |  |  | $ | 33,264 |
The above disclosure represents the aggregation of information related to the Company’s two defined benefit plans which cover many of its European employees. As of December 30, 2012, and January 1, 2012, one of these plans, which primarily covers certain employees in the United Kingdom (the “UK Plan”), had an accumulated benefit obligation in excess of the plan assets. The other plan, which covers certain employees in Europe (the “Europe Plan”), had assets in excess of the accumulated benefit obligation. The following table summarizes this information as of December 30, 2012, and January 1, 2012.
|  | 2012 |  |  | 2011 |
|  | (in thousands) |
UK Plan |  |  |  |
Projected Benefit Obligation |  | $ | 171,381 |  |  | $ | 157,600 |
Accumulated Benefit Obligation |  |  | 171,381 |  |  |  | 157,600 |
Plan Assets |  |  | 162,998 |  |  |  | 139,796 |
Europe Plan |  |  |  |  |  |  |  |
Projected Benefit Obligation |  | $ | 72,267 |  |  | $ | 59,121 |
Accumulated Benefit Obligation |  |  | 69,472 |  |  |  | 57,247 |
Plan Assets |  |  | 78,029 |  |  |  | 66,606 |
|  | FISCAL YEAR |
|  | 2012 |  |  | 2011 |  |  | 2010 |
|  | (in thousands) |
Components of net periodic benefit cost |  |  |  |  |  |  |  |  |  |  |  |
Service cost |  | $ | 505 |  |  | $ | 492 |  |  | $ | 357 |
Interest cost |  |  | 10,212 |  |  |  | 11,194 |  |  |  | 10,873 |
Expected return on plan assets |  |  | (11,203 | ) |  |  | (11,966 | ) |  |  | (11,058 | )
Amortization of prior service cost |  |  | 86 |  |  |  | 0 |  |  |  | 89 |
Recognized net actuarial (gains)/losses |  |  | 1,189 |  |  |  | 602 |  |  |  | 1,566 |
Net periodic benefit cost |  | $ | 789 |  |  | $ | 322 |  |  | $ | 1,827 |
For 2013, it is estimated that approximately $0.8 million of expenses related to the amortization of unrecognized items will be included in the net periodic benefit cost. During 2012, other comprehensive income was impacted by approximately $2.7 million comprised of actuarial gain of approximately $1.8 million and amortization of $0.8 million
|  | FISCAL YEAR |
|  | 2012 |  |  | 2011 |  |  | 2010 |
Weighted average assumptions used to determine net periodic benefit cost |  |  |  |  |  |  |  |  |  |  |  |
Discount rate |  |  | 4.7 | % |  |  | 5.3 | % |  |  | 5.6 | %
Expected return on plan assets |  |  | 5.7 | % |  |  | 5.9 | % |  |  | 6.6 | %
Rate of compensation |  |  | 2.0 | % |  |  | 2.0 | % |  |  | 2.0 | %
Weighted average assumptions used to determine benefit obligations |  |  |  |  |  |  |  |  |  |  |  |
Discount rate |  |  | 4.0 | % |  |  | 4.7 | % |  |  | 5.3 | %
Rate of compensation |  |  | 2.0 | % |  |  | 2.0 | % |  |  | 2.0 | %
The expected long-term rate of return on plan assets assumption is based on weighted average expected returns for each asset class. Expected returns reflect a combination of historical performance analysis and the forward-looking views of the financial markets, and include input from actuaries, investment service firms and investment managers. The Company’s foreign defined benefit plans’ accumulated benefit obligations were in excess of the fair value of the plans’ assets. The projected benefit obligations, accumulated benefit obligations and fair value of these plan assets are as follows:
|  | FISCAL YEAR |
|  | 2012 |  |  | 2011 |
|  | (in thousands) |
Projected benefit obligation |  | $ | 243,649 |  |  | $ | 216,721 |
Accumulated benefit obligations |  |  | 240,853 |  |  |  | 214,848 |
Fair value of plan assets |  |  | 241,027 |  |  |  | 206,402 |
The investment objectives of the foreign defined benefit plans are to maximize the return on the investments without exceeding the limits of the prudent pension fund investment, to ensure that the assets would be sufficient to exceed minimum funding requirements, and to achieve a favorable return against the performance expectation based on historic and projected rates of return over the short term. The goal is to optimize the long-term return on plan assets at a moderate level of risk, by balancing higher-returning assets, such as equity securities, with less volatile assets, such as fixed income securities. The assets are managed by professional investment firms and performance is evaluated periodically against specific benchmarks. The plans’ net assets did not include the Company’s own stock at December 30, 2012, or January 1, 2012. The Company’s actual weighted average asset allocations for 2012 and 2011, and the targeted asset allocation for 2013, of the foreign defined benefit plans by asset category, are as follows:
|  | FISCAL YEAR |
|  | 2013 |  |  | 2012 |  |  | 2011 |
|  | Target Allocation |  |  | Percentage of Plan Assets at Year End |
Asset Category: |  |  |  |  |  |  |  |  |  |  |  |
Equity Securities |  |  | 55-65 | % |  |  | 68 | % |  |  | 66 | %
Debt Securities |  |  | 30-40 | % |  |  | 28 | % |  |  | 30 | %
Other |  |  | 0-5 | % |  |  | 4 | % |  |  | 4 | %
|  |  | 100 | % |  |  | 100 | % |  |  | 100 | %
Fair Value Measurements of Plan Assets Accounting standards establish a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure estimated fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy under applicable accounting standards are described below:
Level 1 |  | Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
Level 2 |  | Inputs to the valuation methodology include:
|  | • quoted prices for similar assets in active markets;
|  | • quoted prices for identical or similar assets in inactive markets;
|  | • inputs other than quoted prices that are observable for the asset; and
|  | • inputs that are derived principally or corroborated by observable data by correlation or other means.
Level 3 |  | Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.
A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The following table sets forth by level within the fair value hierarchy the foreign defined benefit plans’ assets at fair value, as of December 30, 2012 and January 1, 2012. As required by accounting standards, assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
|  | Pension Plan Assets by Category as of December 30, 2012 |
|  | Europe Plan |  |  | UK Plan |  |  | Total |
|  |  |  |  | (in thousands) |  |  |  |
Level 1 |  | $ | 78,029 |  |  | $ | 153,847 |  |  | $ | 231,876 |
Level 2 |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
Level 3 |  |  | 0 |  |  |  | 9,151 |  |  |  | 9,151 |
Total |  | $ | 78,029 |  |  | $ | 162,998 |  |  | $ | 241,027 |
|  | Pension Plan Assets by Category as of January 1, 2012 |
|  | Europe Plan |  |  | UK Plan |  |  | Total |
|  |  |  |  | (in thousands) |  |  |  |
Level 1 |  | $ | 66,606 |  |  | $ | 132,491 |  |  | $ | 199,097 |
Level 2 |  |  | 0 |  |  |  | 0 |  |  |  | 0 |
Level 3 |  |  | 0 |  |  |  | 7,305 |  |  |  | 7,305 |
Total |  | $ | 66,606 |  |  | $ | 139,796 |  |  | $ | 206,402 |
The assets identified as level 3 above relate to insured annuities held by the UK Plan. The fair value of these assets was calculated using the present value of the future pension payments due under the insurance policies. The table below indicates the change in value related to these level 3 assets during 2012:
|  | (in thousands) |
Balance of level 3 assets, beginning of year |  | $ | 7,305 |
Interest cost |  |  | 380 |
Benefits paid |  |  | (1,129 | )
Actuarial gain |  |  | 2,243 |
Translation adjustment |  |  | 352 |
Ending Balance of level 3 assets |  | $ | 9,151 |
During 2013, the Company expects to contribute $5.3 million to the plan trust and $10.0 million in the form of direct benefit payments for its foreign defined benefit plans. It is anticipated that future benefit payments for the foreign defined benefit plans will be as follows:
|  | EXPECTED PAYMENTS |
FISCAL YEAR |  | (in thousands) |
2013 |  | $ | 10,003 |
2014 |  |  | 10,144 |
2015 |  |  | 10,343 |
2016 |  |  | 10,669 |
2017 |  |  | 10,902 |
2018-2022 |  |  | 55,684 |
Domestic Defined Benefit Plan The Company maintains a domestic nonqualified salary continuation plan (“SCP”), which is designed to induce selected officers of the Company to remain in the employ of the Company by providing them with retirement, disability and death benefits in addition to those which they may receive under the Company’s other retirement plans and benefit programs. The SCP entitles participants to: (i) retirement benefits upon normal retirement at age 65 (or early retirement as early as age 55) after completing at least 15 years of service with the Company (unless otherwise provided in the SCP), payable for the remainder of their lives (or, if elected by a participant, a reduced benefit is payable for the remainder of the participant’s life and any surviving spouse’s life) and in no event less than 10 years under the death benefit feature; (ii) disability benefits payable for the period of any total disability; and (iii) death benefits payable to the designated beneficiary of the participant for a period of up to 10 years. Benefits are determined according to one of three formulas contained in the SCP, and the SCP is administered by the Compensation Committee of the Company’s Board of Directors, which has full discretion in choosing participants and the benefit formula applicable to each. The Company’s obligations under the SCP are currently unfunded (although the Company uses insurance instruments to hedge its exposure thereunder). The Company is required to contribute the present value of its obligations thereunder to an irrevocable grantor trust in the event of a change in control as defined in the SCP. The Company uses a year-end measurement date for the domestic SCP. The tables presented below set forth the required disclosures in accordance with applicable accounting standards, and amounts recognized in the consolidated financial statements related to the domestic SCP.
|  | FISCAL YEAR |
|  | 2012 |  |  | 2011 |
|  | (in thousands) |
Change in benefit obligation |  |  |  |  |  |  |  |
Benefit obligation, beginning of year |  | $ | 19,308 |  |  | $ | 19,008 |
Service cost |  |  | 452 |  |  |  | 393 |
Interest cost |  |  | 1,014 |  |  |  | 1,135 |
Benefits paid |  |  | (847 | ) |  |  | (949 | )
Actuarial loss (gain) |  |  | 1,996 |  |  |  | (279 | )
Benefit obligation, end of year |  | $ | 21,923 |  |  | $ | 19,308 |
The amounts recognized in the consolidated balance sheets are as follows:
|  | 2012 |  |  | 2011 |
|  | (in thousands) |
Current liabilities |  | $ | 847 |  |  | $ | 847 |
Non-current liabilities |  |  | 21,076 |  |  |  | 18,461 |
|  | $ | 21,923 |  |  | $ | 19,308 |
The components of the amounts in accumulated other comprehensive income, after tax, are as follows:
|  | 2012 |  |  | 2011 |
|  | (in thousands) |
Unrecognized actuarial loss |  | $ | 3,963 |  |  | $ | 2,926 |
Unrecognized transition asset |  |  | 0 |  |  |  | 0 |
Unamortized prior service cost |  |  | 43 |  |  |  | 72 |
|  | $ | 4,006 |  |  | $ | 2,998 |
The accumulated benefit obligation related to the SCP was $18.1 million and $16.0 million as of December 30, 2012, and January 1, 2012, respectively. The SCP is currently unfunded; as such, the benefit obligations disclosed are also the benefit obligations in excess of the plan assets. The Company uses insurance instruments to help limit its exposure under the SCP.
|  | 2012 |  |  | 2011 |  |  | 2010 |
|  | (in thousands, except for assumptions) |
Assumptions used to determine net periodic benefit cost |  |  |  |  |  |  |  |  |  |  |  |
Discount rate |  |  | 4.75 | % |  |  | 5.5 | % |  |  | 6.0 | %
Rate of compensation |  |  | 4.0 | % |  |  | 4.0 | % |  |  | 4.0 | %
Assumptions used to determine benefit obligations |  |  |  |  |  |  |  |  |  |  |  |
Discount rate |  |  | 4.0 | % |  |  | 4.75 | % |  |  | 5.5 | %
Rate of compensation |  |  | 4.0 | % |  |  | 4.0 | % |  |  | 4.0 | %
Components of net periodic benefit cost |  |  |  |  |  |  |  |  |  |  |  |
Service cost |  | $ | 452 |  |  | $ | 393 |  |  | $ | 342 |
Interest cost |  |  | 1,014 |  |  |  | 1,138 |  |  |  | 1,121 |
Amortizations |  |  | 316 |  |  |  | 637 |  |  |  | 545 |
Net periodic benefit cost |  | $ | 1,782 |  |  | $ | 2,168 |  |  | $ | 2,008 |
The changes in other comprehensive income during 2012 related to this Plan were approximately $1.0 million, after tax, primarily comprised of a net loss during the period of $1.2 million. For 2013, the Company estimates that approximately $0.3 million of expenses, after tax, related to the amortization of unrecognized items will be included in net periodic benefit cost for the SCP. During 2012, the Company contributed $0.8 million in the form of direct benefit payments for its domestic SCP. It is anticipated that future benefit payments for the SCP will be as follows:
|  | EXPECTED PAYMENTS |
FISCAL YEAR |  | (in thousands) |
2013 |  | $ | 847 |
2014 |  |  | 847 |
2015 |  |  | 847 |
2016 |  |  | 847 |
2017 |  |  | 847 |
2018-2022 |  |  | 6,706 |

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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. Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 132R -Paragraph 5 -Subparagraph b -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 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 132R -Paragraph 8 -Subparagraph m -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 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 87 -Paragraph 264 -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 10: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Principles Board Opinion (APB) -Number 30 -Paragraph 26 -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 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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