Pension Liabilities

12 Months Ended

Dec. 31, 2011

Pension Liabilities [Abstract]

Pension Liabilities

Note 18 – Pension Liabilities

Supplemental Executive Retirement Plan

     In March 2007, the Board of Directors of Reading International, Inc. ("Reading") approved a Supplemental Executive Retirement Plan ("SERP") pursuant to which Reading has agreed to provide James J. Cotter, its Chief Executive Officer and Chairman of the Board of Directors, supplemental retirement benefits effective March 1, 2007. Under the SERP, Mr. Cotter will receive a monthly payment of the greater of (i) 40% of the average monthly earnings over the highest consecutive 36-month period of earnings prior to Mr. Cotter's separation from service with Reading or (ii) $25,000 per month for the remainder of his life, with a guarantee of 180 monthly payments following his separation from service with Reading or following his death. The beneficiaries under the SERP may be designated by Mr. Cotter or by his beneficiary following his or his beneficiary's death. The benefits under the SERP are fully vested as of March 1, 2007.

     The SERP initially will be unfunded, but Reading may choose to establish one or more grantor trusts from which to pay the SERP benefits. As such, the SERP benefits are unsecured, general obligations of Reading. The SERP is administered by the Compensation Committee of the Board of Directors of Reading. In accordance with FASB ASC 715-30-05 – Defined Benefit Pension Plans ("ASC 715-30-05"), the initial pension benefit obligation of $2.7 million was included in our other liabilities with a corresponding amount of unrecognized prior service cost included in accumulated other comprehensive income on March 1, 2007 (see Note 24 – Comprehensive Income (Loss)). The initial benefit obligation was based on a discount rate of 5.75% and a compensation increase rate of 3.5%. The $2.7 million is being amortized as a prior service cost over the estimated service period of 10 years combined with an annual interest cost. For the years ended December 31, 2011, 2010, and 2009, we recognized $195,000, $200,000, and $160,000, respectively, of interest cost and $304,000 of amortized prior service cost per year. For the years ended December 31, 2011 and 2010, we recognized $24,000 and $0 of amortized net gains. The balance of the other liability for this pension plan was $3.5 million and $3.8 million at December 31, 2011 and 2010, respectively, and the accumulated unrecognized prior service costs included in other comprehensive income balance was $1.2 and $2.1 million at December 31, 2011 and 2010, respectively. The December 31, 2011 and 2010 values of the SERP are based on a discount rate of 5.10% and 6.25%, respectively and an annual compensation growth rate of 3.50% per year.

     The change in the SERP pension benefit obligation and the funded status for the year ending December 31, 2011 and 2010are as follows (dollars in thousands):

		For the year ending
Change in Benefit Obligation		December 31, 2011
Benefit obligation at January 1, 2011	$	3,820
Interest cost		195
Actuarial gain		(504	)
Benefit obligation at December 31, 2011		3,511
Funded status at December 31, 2011	$	(3,511	)
		For the year ending
Change in Benefit Obligation		December 31, 2010
Benefit obligation at January 1, 2010	$	3,428
Interest cost		200
Actuarial gain		192
Benefit obligation at December 31, 2010		3,820
Funded status at December 31, 2010	$	(3,820	)

Amount recognized in balance sheet consists of (dollars in thousands):

		At December 31,		At December 31,
		2011		2010
Noncurrent assets	$	-	$	-
Current liabilities		10		9
Noncurrent liabilities		3,501		3,811

Items not yet recognized as a component of net periodic pension cost consist of (dollars in thousands):

		At December 31,			At December 31,
		2011			2010
Unamortized actuarial (gain) loss	$	(14	)	$	514
Prior service costs		1,234			1,538
Accumulated other comprehensive loss	$	1,220		$	2,052

     The components of the net periodic benefit cost and other amounts recognized in other comprehensive income are as follows (dollars in thousands):

		From January 1, 2011			From January 1, 2010
Net periodic benefit cost		to December 31, 2011			to December 31, 2010
Service cost	$	-		$	-
Interest cost		195			200
Expected return on plan assets		-			-
Amortization of prior service costs		304			304
Amortization of net gain		24			-
Net periodic benefit cost	$	523		$	504
Other changes in plan assets and benefit obligations
recognized in other comprehensive income
Net (gain) loss	$	(504	)	$	192
Prior service cost		-			-
Amortization of prior service cost		(304	)		(304	)
Amortization of net gain		(24	)		-
Total recognized in other comprehensive income	$	(832	)	$	(112	)
Total recognized in net periodic benefit cost and other
comprehensive income	$	(309	)	$	392

     The estimated net loss and prior service cost for the defined benefit pension plan that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year will be $0 and $304,000, respectively.

     The following weighted average assumptions were used to determine the plan benefit obligations at December 31, 2011 and 2010:

	2011		2010
Discount rate	4.25	%	5.10	%
Rate of compensation increase	3.50	%	3.50	%

     The following weighted-average assumptions were used to determine net periodic benefit cost for the year ended December 31, 2011 and 2010:

	2011		2010
Discount rate	5.10	%	5.85	%
Expected long-term return on plan assets	0.00	%	0.00	%
Rate of compensation increase	3.50	%	3.50	%

Other Pension Liabilities

     In addition to the aforementioned SERP, Mr. S. Craig Tompkins has a vested interest in the pension plan originally established by Craig Corporation prior to its merger with our company of $195,000 and $194,000 at December 31, 2011 and 2010, respectively. The balance accrues interest at 30 day LIBOR and is maintained as an unfunded Executive Pension Plan obligation included in other liabilities. Mr. Tompkins will be paid the balance of this pension once he no longer provides services to the Company. Additionally, as part of his employment agreement, Mr. John Hunter, our Chief Operating Officer, has a vested interest in a pension plan that currently accrues $200,000 per year and had a balance of $583,000 and $392,000 at December 31, 2011 and 2010, respectively. Mr. Hunter will be paid the balance of his pension on the last day of his employment with the Company.

     The benefit payments for all of our pensions, which reflect expected future service, as appropriate, are expected to be paid over the following periods (dollars in thousands):

		Pension
		Payments
2012	$	10
2013		20
2014		30
2015		40
2016		50
Thereafter		4,139
Total pension payments	$	4,289