Note 5 – Derivatives

During 2007, the Company entered into an interest rate contract for an initial amount of $540 million to hedge a portion of its variable rate $725 million Term Loan Facility (“interest rate contract”), portions of which matured on a series of dates through May 17, 2012.

The Company has also entered into a series of forward contracts to hedge a portion of certain foreign currency purchases (“foreign currency contracts”). The foreign currency contracts provide for a fixed exchange rate and mature over a series of dates through October 2012. As of July 28, 2012, the Company had hedges on $21.5 million of its forecasted foreign currency purchases. The fair value, amounts classified in other comprehensive income (“OCI”), and the amounts reclassified from accumulated other comprehensive income (“AOCI”) on the foreign currency contracts were not significant for any periods presented.

The interest rate contract was designated as a cash flow hedging instrument. The change in the fair value of the interest rate contract was recorded as a component of AOCI and reclassified into earnings in the periods in which earnings were impacted by the hedged item. The following table presents the fair value of the Company’s hedging portfolio related to its interest rate contract:


	Location on Condensed Consolidated Balance Sheets		Fair Value
(dollars in millions)	Location on Condensed Consolidated Balance Sheets		July 28, 2012		July 30, 2011		January 28, 2012
Interest rate contract		Accrued expenses	$	—	$	3.3	$	2.0

It is the Company’s policy to enter into derivative instruments with terms that match the underlying exposure being hedged. As such, the Company’s derivative instruments are considered highly effective, and the net gain or loss from hedge ineffectiveness is not significant. Realized gains or losses on the hedging instruments occur when a portion of the hedge settles or if it is probable that the forecasted transaction will not occur. The impact of the derivative instruments on the Condensed Consolidated Financial Statements is as follows:


	Gain Recognized in OCI on Derivatives						Loss Reclassified from AOCI into (Loss) Earnings
	13 Weeks Ended				Location on Condensed Consolidated Statement of Earnings (Loss)		13 Weeks Ended
(dollars in millions)	July 28, 2012		July 30, 2011				July 28, 2012		July 30, 2011
Interest rate contract	$	—	$	0.2		Interest expense	$	—	$	(1.1	)


	Gain Recognized in OCI on Derivatives						Loss Reclassified from AOCI into (Loss) Earnings
	26 Weeks Ended				Location on Condensed Consolidated Statement of Earnings (Loss)		26 Weeks Ended
(dollars in millions)	July 28, 2012		July 30, 2011				July 28, 2012			July 30, 2011
Interest rate contract	$	—	$	—		Interest expense	$	(0.9	)	$	(2.7	)