FAIR VALUE MEASUREMENTS

9 Months Ended

Sep. 27, 2014

INVESTMENTS

The Company invests in marketable securities, principally equity-based mutual funds, to mitigate the risk associated with the investment return on employee deferrals of compensation. The Company had approximately $6.9 million, $5.4 million, and $4.5 million of such Level 1 investments as of September 27, 2014, December 28, 2013, and September 28, 2013, respectively.

During the third fiscal quarter and three fiscal quarters ended September 27, 2014 and September 28, 2013, gains on the investments in marketable securities were not significant.

CONTINGENT CONSIDERATION

The following table summarizes the changes in the contingent consideration liability related to the Company's acquisition of Bonnie Togs on June 30, 2011:



	Fiscal quarter ended						Three fiscal quarters ended
(dollars in thousands)	September 27, 2014			September 28, 2013			September 27, 2014			September 28, 2013
Balance at the beginning of period	$	16,848		$	29,950		16,348			29,704
Payments made	(8,901		)	(14,721		)	(8,901		)	(14,721		)
Accretion (income) expense	444			480			900			2,347
Foreign currency translation adjustment	(762		)	791			(718		)	(830		)
Balance at the end of period	$	7,629		$	16,500		$	7,629		$	16,500

The contingent consideration liability is a Level 3 fair value measurement. As of September 27, 2014, the Company determined the fair value of contingent consideration based upon a probability-weighted discounted cash flow analysis reflecting a high probability that the earnings targets will be met, and a discount rate of 18%.

BORROWINGS

As of September 27, 2014, the Level 2 fair value of the Company's $186 million in borrowings under its secured revolving credit facility approximated carrying value. The Level 2 fair value of the Company's $400 million in senior notes outstanding was approximately $410.0 million.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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