Note 20 - Multiemployer Pension Plans

The Company has participated in the Graphic Communications Conference International Brotherhood of Teamsters National Pension Fund (“NPF”), formerly known as the Graphic Communications Conference International Brotherhood of Teamsters Supplemental Retirement and Disability Fund (“SRDF”), pursuant to collective bargaining agreements at eight locations. In the fourth quarter of 2012, the Company’s Board of Directors executed a resolution to authorize management to enter into good faith negotiations with the local bargaining units to effect a complete withdrawal from the NPF. The negotiations with the local bargaining units continued during 2013, with negotiations for withdrawal completed with all but one bargaining unit by year-end. The decision to exit the NPF was made in order to mitigate potentially greater financial exposure to the Company in the future under the plan, which is significantly underfunded, and to facilitate the consideration of future changes to the Company’s operations in the United States. A withdrawal liability should be recorded if circumstances that give rise to an obligation become probable and estimable. Management concluded that a complete withdrawal from the NPF was both probable and estimable, subject to the Company’s good faith bargaining obligations. Based on an analysis prepared by an independent actuary, the Company recorded an estimated liability for its withdrawal from the NPF of $31,683, which was the present value of the estimated future payments required for withdrawal. The payments are expected to total approximately $41,186, payable $2,059 per year over a 20 year period, with the payments expected to commence on or about May 1, 2014. These payments were discounted at a risk free rate of 2.54 percent. Even after the Company has withdrawn from the plan, if a plan termination or mass withdrawal occurs, the Company’s withdrawal liability may be larger than it is currently estimated. The Company believes the likelihood of a plan termination or mass withdrawal occurring within the next few years to be remote.

The expense of $31,683 associated with the pension withdrawal liability is reflected in Multiemployer pension withdrawal expense for the year ended December 31, 2012 on the Consolidated Statements of Comprehensive Income (Loss). During 2013, the company accreted $833 of the present value discount resulting in an estimated liability of $32,516 at December 31, 2013, which is included on the Consolidated Balance Sheets at December 31, 2013 as follows: $1,261 in Accrued expenses and $31,255 in Other long-term liabilities. The expense associated with the accretion of the present value discount is reflected in Interest expense on the Consolidated Statements of Comprehensive Income (Loss).

The Company previously participated in the San Francisco Lithographers Pension Trust (“SF LPT”) pursuant to collective bargaining agreements with the Teamsters Local 853. Effective June 30, 2011, the Company decided to terminate participation in the SF LPT and provided notification that it would no longer be making contributions to the plan. The Company’s decision triggered a withdrawal liability. The Company recorded an estimated liability of $1,846 as of June 30, 2011 to reflect this obligation. The expense associated with the pension withdrawal liability is reflected in Multiemployer pension withdrawal expense (income) for the year ended December 31, 2011 on the Consolidated Statements of Comprehensive Income (Loss). The Company made a payments totaling $1,643 during 2012 to settle the liability in full. The $203 reduction from the initial liability of $1,846 is recorded as a credit to Multiemployer pension withdrawal expense for the year ended December 31, 2012 on the Consolidated Statements of Comprehensive Income (Loss).

The Company contributes to a number of multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover its union-represented employees. The risks of participating in these multiemployer plans are different from single-employer plans in the following aspects:

a.	Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers.

b.	If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers.

c.	If the Company chooses to stop participating in one of its multiemployer plans, it may be required to pay the plan an amount based on the underfunded status of the plan, referred to as withdrawal liability.

The Company’s participation in these plans for the annual period ended December 31, 2013, is outlined in the table below. The “EIN/Pension Plan Number” row provides the Employee Identification Number (“EIN”) and the three-digit plan number, if applicable. Unless otherwise noted, the most recent Pension Protection Act (“PPA”) zone status available in 2013 and 2012 is for the plan’s year-end at April 30, 2013 and April 30, 2012, respectively, if applicable. The zone status is based on information that the Company received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. The “FIP/RP Status Pending/implemented” row indicates plans for which a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) is either pending or has been implemented. The last row lists the expiration dates of the collective-bargaining agreements to which the plans are subject. There have been no significant changes, affecting period-to-period comparability of contributions, to the number of employees covered by the Company’s multiemployer plans from 2011 to 2013.

Pension Fund		Graphic Communications Conference International Brotherhood of Teamsters National Pension Fund		CEP Multi-Employer Pension Plan

Country		United States of America		Canada
EIN/Pension Plan Number		52-6118568-001		RN 0542696
Pension Protection Act Zone Status:
2013		Red		At least 80% funded
2012		Red		At least 80% funded
FIP/RP Status Pending/Implemented		Yes		N/A
Contributions of Schawk, Inc.:
2013	$	527	$	76
2012	$	686	$	85
2011	$	844	$	85
Surcharge Imposed		No		No
Expiration Dates of Collective- Bargaining Agreements		N/A		May 1, 2014

The Company’s contributions did not represent more than five percent of total contributions to the NPF as indicated in the NPF’s Form 5500 for the plan year ending April 30, 2012 (the Plan’s most recently available annual report). Based on preliminary information, it is anticipated the Company’s contributions will not represent more than five percent of total contributions to the NPF for the plan year ending April 30, 2013.