3. Employee Retirement Benefit Plans

9 Months Ended

Sep. 30, 2016

Notes

3. Employee Retirement Benefit Plans

3.        EMPLOYEE RETIREMENT BENEFIT PLANS

 Settlement of Pension Plan Liabilities

On April 21, 2015, the Company entered into a series of agreements to terminate its defined pension plan (the "Pension Plan") and settle the resulting liabilities. Pursuant to the agreements, as of September 30, 2016, the Company is obligated to pay remaining installments of $750 to the Pension Benefit Guaranty Corporation (the "PBGC") due annually on October 31 of each year from 2016 through 2026 (the "Pension Settlement Obligation"). As security for the Pension Settlement Obligation, the Company granted to the PBGC a security interest on all of the Company's assets, subordinate to certain senior liens held by the Company's two senior lenders. The Pension Settlement Obligation is recorded net of imputed interest expense at 7%, as a liability on the balance sheet.

The Company recorded pension expense of $326 attributable to the Pension Plan for the first quarter of 2015, which was prior to the April 2015 plan termination. As a result of the termination Pension Plan, the Company's only remaining pension obligation is the Supplemental Executive Retirement Plan ("SERP").

Employer Contributions

The Company is not currently required to fund the SERP.  All benefit payments are made by the Company directly to those who receive benefits from the SERP.  As such, these payments are treated as both contributions and benefits paid for reporting purposes. The Company expects to contribute and pay SERP benefits of approximately $551 in the next 12 months.

Components of Net Periodic Benefit Expense

			Supplemental Executive
	Pension Plan		Retirement Plan
	September 30,	October 2,	September 30,	October 2,
For the three months ended:	2016	2015	2016	2015
Service cost	$-	$-	$-	$-
Interest cost	-	-	48	44
Expected return on assets	-	-	-	-
Amortization of actuarial loss	-	-	21	17
Amortization of prior year service cost	-	-	(3)	(12)
Net periodic benefit expense	-	-	66	49
Insurance premium due PBGC	-	-	-	-
	$-	$-	$66	$49

			Supplemental Executive
	Pension Plan		Retirement Plan
	September 30,	October 2,	September 30,	October 2,
For the nine months ended:	2016	2015	2016	2015
Service cost	$-	$-	$-	$-
Interest cost	-	617	143	132
Expected return on assets	-	(585)	-	-
Amortization of actuarial loss	-	195	62	51
Amortization of prior year service cost	-	-	(8)	(36)
Net periodic benefit expense	-	227	197	147
Insurance premium due PBGC	-	99	-	-
	$-	$326	$197	$147

For the nine-month period ended October 2, 2015, the Company reclassified $195 of actuarial loss from accumulated other comprehensive loss that was included in pension expense in the statements of comprehensive loss for the same period.