6.	RETIREMENT AND OTHER BENEFIT PLANS

The Company sponsors pension plans in both the United States and Canada. The Company's domestic pension plans cover substantially all United States employees. Under the domestic plans, salaried, management and certain hourly employees' pension benefits are based on the employee's highest consecutive five years of compensation during the 10 years before retirement. The Company's Canadian pension plans cover certain employees based on plan specifications. Under the Canadian plans, employees' pension benefits are based on the employee's highest consecutive five years of compensation during the 10 years before retirement. The Company's funding policy for all plans is to make the minimum annual contributions required by applicable regulations.

The Company also maintains an unfunded Supplemental Executive Retirement Plan ("SERP"). As of January 28, 2012, the projected benefit obligation of this plan was $8.0 million and the accumulated benefit obligation was $6.2 million.

In addition to providing pension benefits, the Company sponsors unfunded defined benefit postretirement life insurance plans that cover both salaried and hourly employees who became eligible for benefits by January 1, 1995. The life insurance plans provide coverage of up to twenty-thousand dollars for qualifying retired employees.

Benefit Obligations

The following table sets forth changes in benefit obligations, including all domestic and Canadian plans:


	Pension Benefits						Other Postretirement Benefits
($ thousands)	2011			2010			2011			2010
Benefit obligation at beginning of year	$	215,373		$	197,259		$	3,230		$	3,657
Service cost		9,256			7,826			–			–
Interest cost		12,533			12,102			176			186
Plan participants' contribution		11			10			17			41
Plan amendments		153			18			–			–
Actuarial loss (gain)		42,746			13,480			315			(409	)
Benefits paid		(18,590	)		(15,677	)		(253	)		(245	)
Foreign exchange rate changes		(23	)		355			–			–
Benefit obligation at end of year	$	261,459		$	215,373		$	3,485		$	3,230

The accumulated benefit obligation for the United States pension plans was $236.7 million and $196.6 million as of January 28, 2012 and January 29, 2011, respectively. The accumulated benefit obligation for the Canadian pension plans was $4.6 million and $5.1 million as of January 28, 2012 and January 29, 2011, respectively.


	Pension Benefits		Other Postretirement Benefits
Weighted-average assumptions used to determine benefit obligations, end of year	2011	2010	2011	2010
Discount rate	4.75%	5.75%	4.75%	5.75%
Rate of compensation increase	4.00%	4.00%	N/A	N/A

Plan Assets

Pension assets are managed in accordance with the prudent investor standards of the Employee Retirement Income Security Act ("ERISA"). The plan's investment objective is to earn a competitive total return on assets, while also ensuring plan assets are adequately managed to provide for future pension obligations. This results in the protection of plan surplus and is accomplished by matching the duration of the projected benefit obligation using leveraged fixed income instruments and, while maintaining a 70% overall (United States and international) equity commitment, managing an equity overlay strategy. The overlay strategy is intended to protect the managed equity portfolios against adverse stock market environments. The Company delegates investment management to specialists in each asset class and regularly monitors manager performance and compliance with investment guidelines. The Company's overall investment strategy is to achieve a mix of approximately 95% of investments for long-term growth and 5% for near-term benefit payments with a wide diversification of asset types, fund strategies and fund managers. The target allocations for plan assets for 2012 are 55% domestic equities, 30% debt securities and 15% foreign equities. Allocations may change periodically based upon changing market conditions. Domestic equities did not include any Company stock at January 28, 2012 or January 29, 2011.

Assets of the Canadian pension plans, which total approximately $4.9 million at January 28, 2012, were invested 55% in equity funds, 42% in bond funds and 3% in money market funds. The Canadian pension plans did not include any Company stock as of January 28, 2012 or January 29, 2011.

A financial instrument's level within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. See further discussion on the fair value hierarchy in Note 14 to the consolidated financial statements. Following is a description of the pension plan investments measured at fair value, including the general classification of such investments pursuant to the valuation hierarchy.

Investments in corporate stocks – common, U.S. government securities, mutual fund, money market funds, real estate investment trusts and S&P 500 Index put and call options (traded on security exchanges) are classified within Level 1 of the fair value hierarchy because the fair values are based on unadjusted quoted market prices in active markets with sufficient volume and frequency.

·	Corporate debt instruments and interest rate swap agreements are valued at fair value based on vendor-quoted pricing for which inputs are observable; therefore, these are classified within Level 2 of the fair value hierarchy.

The limited partnership investment represents the pension plan's undivided interest in a limited partnership. Limited partnership assets are allocated to the pension plan by assigning the pension plan transactions that can be specifically identified and allocating non-specific transactions in proportion to the pension plan's beneficial interest in the limited partnership; therefore, this contract is classified within Level 2 of the fair value hierarchy. There are currently no redemption restrictions on the limited partnership investment.

The group trust investment is a unitized fund classified within Level 2 of the fair value hierarchy because the fair value is estimated using the NAV per unit based on vendor-quoted pricing for which inputs are observable. There are currently no redemption restrictions on the group trust investment.

·	The unallocated insurance contract is valued at contract value, which approximates fair value; therefore, this contract is classified within Level 3 of the fair value hierarchy. The unallocated insurance contract fair value was $0.1 million as of both January 28, 2012 and January 29, 2011.

The fair values of the Company's pension plan assets at January 28, 2012 by asset category are as follows:

				Fair Value Measurements at January 28, 2012
($ thousands)		Total		Level 1		Level 2		Level 3
Asset
Money market funds	$	4,723	$	4,723	$	–	$	–
U.S. government securities		68,667		68,667		–		–
Mutual fund		11,078		11,078		–		–
Limited partnership		31,461		–		31,461		–
Group trust		7,306		–		7,306		–
Real estate investment trusts		2,047		2,047		–		–
Corporate debt instruments		68,240		–		68,240		–
Corporate stocks – common		112,795		112,795		–		–
S&P 500 Index options		1,472		1,472		–		–
Interest rate swap agreements		13,406		–		13,406		–
Unallocated insurance contract		104		–		–		104
Total	$	321,299	$	200,782	$	120,413	$	104

The fair values of the Company's pension plan assets at January 29, 2011 by asset category are as follows:

				Fair Value Measurements at January 29, 2011
($ thousands)		Total		Level 1		Level 2		Level 3
Asset (liability)
Money market funds	$	6,991	$	6,991	$	–	$	–
U.S. government securities		40,965		40,965		–		–
Mutual fund		13,180		13,180		–		–
Limited partnership		39,459		–		39,459		–
Group trust		8,548		–		8,548		–
Real estate investment trusts		1,970		1,970		–		–
Corporate debt instruments		51,263		–		51,263		–
Corporate stocks – common		119,460		119,460		–		–
S&P 500 Index options		(1,632	)	(1,632	)	–		–
Interest rate swap agreements		(14,462	)	–		(14,462	)	–
Unallocated insurance contract		106		–		–		106
Total	$	265,848	$	180,934	$	84,808	$	106

The following table sets forth changes in the fair value of plan assets, including all domestic and Canadian plans:


	Pension Benefits						Other Postretirement Benefits
($ thousands)	2011			2010			2011			2010
Fair value of plan assets at beginning of year	$	265,848		$	239,427		$	–		$	–
Actual return on plan assets		66,527			38,053			–			–
Employer contributions		7,523			3,657			236			204
Plan participants' contributions		11			10			17			41
Benefits paid		(18,590	)		(15,677	)		(253	)		(245	)
Foreign exchange rate changes		(20	)		378			–			–
Fair value of plan assets at end of year	$	321,299		$	265,848		$	–		$	–

The majority of employer contributions for 2011 related to payments due under our SERP. Employer contributions and benefits paid in the above table include both those amounts contributed directly to and paid directly from plan assets and those amounts paid directly to plan participants.

Funded Status

The over-funded status as of January 28, 2012 and January 29, 2011, for pension benefits was $59.8 million and $50.5 million, respectively. The under-funded status as of January 28, 2012 and January 29, 2011, for other postretirement benefits was $3.5 million and $3.2 million, respectively.

Amounts recognized in the consolidated balance sheets consist of:


	Pension Benefits						Other Postretirement Benefits
($ thousands)	2011			2010			2011			2010
Prepaid pension costs (noncurrent asset)	$	68,054		$	63,250		$	–		$	-
Accrued benefit liabilities (current liability)		(226	)		(7,219	)		(322	)		(327	)
Accrued benefit liabilities (noncurrent liability)		(7,988	)		(5,556	)		(3,163	)		(2,903	)
Net amount recognized at end of year	$	59,840		$	50,475		$	(3,485	)	$	(3,230	)

The projected benefit obligation, the accumulated benefit obligation and the fair value of plan assets for pension plans with a projected benefit obligation in excess of plan assets and for pension plans with an accumulated benefit obligation in excess of plan assets, which includes only the Company's SERP, were as follows:


	Projected Benefit Obligation Exceeds the Fair Value of Plan Assets				Accumulated Benefit Obligation Exceeds the Fair Value of Plan Assets
($ thousands)	2011		2010		2011		2010
End of Year
Projected benefit obligation	$	7,997	$	12,710	$	7,997	$	12,710
Accumulated benefit obligation		6,208		11,080		6,208		11,080
Fair value of plan assets		-		-		-		-

The accumulated postretirement benefit obligation exceeds assets for all of the Company's other postretirement benefit plans.

The amounts in accumulated other comprehensive (income) loss that have not yet been recognized as components of net periodic benefits cost (income) at January 28, 2012 and January 29, 2011, and the expected amortization of the January 28, 2012 amounts as components of net periodic benefit cost (income) for the year ended February 2, 2013, are as follows:


	Pension Benefits						Other Postretirement Benefits
($ thousands)	2011			2010			2011			2010
Components of accumulated other comprehensive (income) loss, net of tax:
Net actuarial (gain) loss	$	(2,658	)	$	669		$	(492	)	$	(745	)
Net prior service cost		67			(32	)		-			-
Net transition asset		(31	)		(65	)		-			-
	$	(2,622	)	$	572		$	(492	)	$	(745	)

	Pension Benefits						Other Postretirement Benefits
($ thousands)	2012						2012
Expected amortization, net of tax:
Amortization of net actuarial losses (gains)				$	195					$	(31	)
Amortization of net prior service cost					6						-
Amortization of net transition asset					26						-
				$	227					$	(31	)

Net Periodic Benefit Cost

Net periodic benefit cost (income) for 2011, 2010 and 2009 for all domestic and Canadian plans included the following components:


	Pension Benefits										Other Postretirement Benefits
($ thousands)	2011				2010			2009			2011			2010			2009
Service cost	$	9,256		$		7,826		$	6,790		$	–		$	–		$	–
Interest cost		12,533				12,102			11,573			176			186			219
Expected return on assets		(20,741	)			(20,183	)		(19,494	)		–			–			–
Amortization of:
Actuarial loss (gain)		400				172			120			(99	)		(112	)		(85	)
Prior service cost		(8	)			(8	)		(12	)		–			–			–
Net transition asset		(47	)			(46	)		(137	)		–			–			–
Settlement cost		2,100				878			127			–			–			–
Total net periodic benefit cost (income)	$	3,493		$		741		$	(1,033	)	$	77		$	74		$	134

Weighted-average assumptions used to determine net cost (income):


	Pension Benefits			Other Postretirement Benefits
	2011	2010	2009	2011	2010	2009
Discount rate	5.75%	6.00%	6.50%	5.75%	6.00%	6.50%
Rate of compensation increase	4.00%	4.25%	4.25%	N/A	N/A	N/A
Expected return on plan assets	8.50%	8.50%	8.50%	N/A	N/A	N/A

The prior service cost is amortized on a straight-line basis over the average future service of active plan participants benefiting under the plan at the time of each plan amendment. The net actuarial loss (gain) subject to amortization is amortized on a straight-line basis over the average future service of active plan participants as of the measurement date. The net transition asset is amortized over the estimated service life.

The expected long-term rate of return on plan assets is based on historical and projected rates of return for current and planned asset classes in the plan's investment portfolio. Assumed projected rates of return for each asset class were selected after analyzing experience and future expectations of the returns. The overall expected rate of return for the portfolio was developed based on the target allocation for each asset class.

Expected Cash Flows

Information about expected cash flows for all pension and postretirement benefit plans follows:


	Pension Benefits
($ thousands)	Funded Plans			SERP		Total	Other Postretirement Benefits
Employer Contributions
2012 expected contributions to plan trusts	$	136	$	–	$	136	$	–
2012 expected contributions to plan participants		–		224		224		322
Expected Benefit Payments
2012	$	9,564	$	224	$	9,788	$	322
2013		10,055		966		11,021		309
2014		10,575		149		10,724		294
2015		11,049		2,416		13,465		277
2016		11,577		590		12,167		260
2017 – 2021		66,307		5,260		71,567		1,013

Defined-Contribution Plans

The Company's domestic defined-contribution 401(k) plan covers salaried and certain hourly employees. Company contributions represent a partial matching of employee contributions, generally up to a maximum of 3.5% of the employee's salary and bonus. The Company's expense for this plan was $4.1 million, $3.0 million and $3.2 million in 2011, 2010 and 2009, respectively.

The Company's Canadian defined contribution plan covers certain salaried and hourly employees. The Company makes contributions for all eligible employees, ranging from 3% to 5% of the employee's salary. In addition, eligible employees may voluntarily contribute to the plan. The Company's expense for this plan was $0.3 million in 2011, 2010 and 2009.

Deferred Compensation Plan

In 2007, the Company established a non-qualified deferred compensation plan (the "Deferred Compensation Plan") for the benefit of certain management employees. The investment funds offered to the participants generally correspond to the funds offered in the Company's 401(k) plan, and the account balance fluctuates with the investment returns on those funds. The Deferred Compensation Plan permits the deferral of up to 50% of base salary and 100% of compensation received under the Company's annual incentive plan. The deferrals are held in a separate trust, which has been established by the Company to administer the Deferred Compensation Plan. The assets of the trust are subject to the claims of the Company's creditors in the event that the Company becomes insolvent. Consequently, the trust qualifies as a grantor trust for income tax purposes (i.e., a "Rabbi Trust"). The liabilities of the Deferred Compensation Plan of $1.1 million in 2011 and $1.4 million in 2010 are presented in employee compensation and benefits in the accompanying consolidated balance sheets. The assets held by the trust of $1.1 million in 2011 and $1.4 million in 2010 are classified as trading securities within prepaid expenses and other current assets in the accompanying consolidated balance sheets, with changes in the deferred compensation charged to selling and administrative expenses in the accompanying consolidated statements of earnings.

Deferred Compensation Plan for Non-Employee Directors

Non-employee directors are eligible to participate in a deferred compensation plan, whereby deferred compensation amounts are valued as if invested in the Company's common stock through the use of phantom stock units ("PSUs"). Under the plan, each participating director's account is credited with the number of PSUs equal to the number of shares of the Company's common stock that the participant could purchase or receive with the amount of the deferred compensation, based upon the fair value (as determined based on the average of the high and low prices) of the Company's common stock on the last trading day of the fiscal quarter when the cash compensation was earned. Dividend equivalents are paid on PSUs at the same rate as dividends on the Company's common stock and are re-invested in additional PSUs at the next fiscal quarter-end. The PSUs are payable in cash based on the number of PSUs credited to the participating director's account, valued on the basis of the fair value at fiscal quarter-end on or following termination of the director's service. The liabilities of the plan of $0.6 million as of January 28, 2012 and $0.8 million as of January 29, 2011, are based on 63,936 and 62,218 outstanding PSUs, respectively, and are presented in other liabilities in the accompanying consolidated balance sheets. Gains and losses resulting from changes in the fair value of the PSUs are charged to selling and administrative expenses in the accompanying consolidated statements of earnings.