10. EMPLOYEE BENEFIT PLANS

As of October 31, 2011, the Company had the following defined benefit and other post-retirement benefit plans, which provide benefits based primarily on years of service and employee earnings and which have been previously amended to preclude new participants:

Supplemental Executive Retirement Plan. The Company has unfunded retirement agreements for certain current and former senior executives. The retirement agreements provide for monthly benefits for ten years commencing at the later of the respective retirement dates of those executives or age 65. The benefits are accrued over the vesting period. Effective December 31, 2002, this plan was amended to preclude new participants.

Service Award Benefit Plan. The Company has an unfunded service award benefit plan that meets the definition of a “severance pay plan” as defined by the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and covers certain qualified employees. The plan provides participants, upon termination, with a guaranteed seven days pay for each year of employment subsequent to November 1, 1989. Effective January 1, 2002, no new participants were permitted under this plan. The Company will continue to incur interest costs related to this plan as the value of the previously earned benefits continues to increase.

OneSource Employees’ Retirement Pension Plan (“OneSource Pension Plan”). The Company acquired OneSource on November 14, 2007, which sponsored a funded, qualified employee retirement plan. The plan was amended to preclude participation and benefit accruals several years prior to the acquisition.

Death Benefit Plan. The Company’s unfunded Death Benefit Plan covers certain qualified employees upon retirement on, or after, the employee’s 62nd birthday. This plan provides 50% of the death benefit that the employee was entitled to prior to retirement, subject to a maximum of $150,000. Coverage commencing upon retirement, or 62^nd birthday, continues until death for retired employees hired before September 2, 1980. On March 1, 2003, the post-retirement death benefit for any active employees hired after September 1, 1980 was eliminated. Active employees hired before September 1, 1980 who retire on or after their 62nd birthday will continue to be covered between retirement and death. For certain plan participants who retired before March 1, 2003, the post-retirement death benefit continues until the retired employee’s 70th birthday. An exemption to the “age 62” retirement rule has been made for certain employees who were terminated as a result of the Company’s restructuring to a corporate shared service center.

OneSource Post-Retirement Medical and Life Benefit Plan. OneSource sponsored a post-retirement benefit plan that provides medical and life insurance benefits to certain OneSource retirees. Since the date of acquisition, new participants have been precluded from participation.

Benefit Obligation and Net Obligation Recognized in Financial Statements

The significant components of the above mentioned plans as of and for the years ended October 31, 2011 and 2010 are summarized as follows:

		September 30,			September 30,			September 30,			September 30,
	Defined						Post-Retirement
	Benefit Plans at						Benefit Plan at
	October 31,						October 31,
(in thousands)	2011			2010			2011			2010
Change in benefit obligation
Benefit obligation at beginning of year	$	12,018		$	11,528		$	5,297		$	5,273
Service cost		46			44			13			15
Interest cost		569			592			256			281
Actuarial loss		944			1,126			329			143
Benefits and expenses paid		(1,502	)		(1,272	)		(300	)		(415	)

Benefit obligation at end of year	$	12,075		$	12,018		$	5,595		$	5,297


Change in Plan Assets
Fair value of plan assets at beginning of year	$	5,589		$	4,736		$	—		$	—
Actual return on plan assets		176			615			—			—
Employer contributions		1,654			1,510			300			415
Benefits and expenses paid		(1,502	)		(1,272	)		(300	)		(415	)

Fair value of plan assets at end of year	$	5,917		$	5,589		$	—		$	—


Unfunded status at end of year	$	(6,158	)	$	(6,429	)	$	(5,595	)	$	(5,297	)


Current liabilities		(1,001	)		(1,001	)		(301	)		(277	)
Non-current liabilities		(5,157	)		(5,428	)		(5,294	)		(5,020	)

Net obligation	$	(6,158	)	$	(6,429	)	$	(5,595	)	$	(5,297	)


Total affecting retained earnings	$	(3,765	)	$	(4,936	)	$	(5,315	)	$	(5,347	)
Amount recognized in accumulated other comprehensive income		(2,393	)		(1,493	)		(280	)		50

Net obligation	$	(6,158	)	$	(6,429	)	$	(5,595	)	$	(5,297	)

Components of Net Periodic Benefit Cost Recognized in the Accompanying Consolidated Statement of Income

The components of net periodic benefit cost of the defined benefit and other post-retirement benefit plans for the years ended October 31, 2011, 2010 and 2009 were as follows:

		September 30,			September 30,			September 30,
(in thousands)	2011			2010			2009
Defined Benefit Plans
Service cost	$	46		$	44		$	42
Interest		569			592			811
Expected return on assets		(373	)		(399	)		(321	)
Amortization of actuarial loss		114			66			115
Settlement loss recognized		126			91			349

Net expense	$	482		$	394		$	996

Post-Retirement Benefit Plans
Service cost	$	13		$	15		$	12
Interest		256			281			276
Amortization of actuarial gain		—			—			(202	)

Net expense	$	269		$	296		$	86

In the year ending October 31, 2012, the Company expects to recognize, on a pre-tax basis, less than $0.1 million of net actuarial gains as a component of net periodic benefit cost.

Assumptions

The weighted average assumptions used to determine benefit obligations and net periodic benefit cost for the years ended October 31, 2011, 2010 and 2009 were as follows:

	September 30,	September 30,	September 30,	September 30,	September 30,	September 30,
	Defined Benefit Plans			Post-Retirement Benefit Plan
Assumptions to measure net periodic cost	2011	2010	2009	2011	2010	2009
Discount rate	4.50% -4.98%	5.50%	7.00%	4.31% -5.02%	5.50%	7.00%
Rate of health care cost increase	NA	NA	NA	4.50% -8.00%	5.50%	6.00%
Rate of compensation increase	3.50%	3.50%	3.50%	3.50%	3.50%	3.50%
Rate of return on plan assets	8.00%	8.00%	8.00%	NA	NA	NA

Assumptions to measure obligation at year end

Discount rate	4.12% -4.51%	4.50% -4.98%	5.50%	4.04% -4.56%	4.31% -5.02%	5.50%

The discount rate is used for determining future net periodic benefit cost. The Company’s discount rates were determined, as of the October 31, 2011 measurement date, using the individual cash flows of each plan. In determining the long-term rate of return for a plan, the Company considers the nature of the plan’s investments, historical rates of return, and an expectation for the plan’s investment strategies. All defined benefit and post-retirement plans have been amended to preclude new participants. The Company believes changes in assumptions would not have a material impact on the Company’s financial position and operating performance. The Company expects to fund payments required under the plans with cash flows from operating activities when due in accordance with the plans.

Expected Future Benefit Payments

The expected future benefit payments were calculated using the same assumptions used to measure the Company’s benefit obligation as of October 31, 2011. This expectation is based upon expected future service:

		September 30,		September 30,
	Defined		Post-Retirement
(in thousands)	Benefit Plans		Benefit Plan
2012	$	1,500	$	301
2013		804		310
2014		843		318
2015		849		327
2016		750		336
2017 through 2021	$	3,817	$	1,828

OneSource Pension Plan

The OneSource Pension Plan is a funded benefit plan that requires an estimate of the long-term rate of return on plan assets to measure benefit obligations. The expected long-term rate of return on plan assets represents the rate of earnings expected in the funds invested to provide for anticipated benefit payments. With input from the Company’s investment advisors and actuaries, the Company has analyzed the expected rates of return on assets and determined that an estimated long-term rate of return of 8.0% is reasonable based on: (1) the current and expected asset allocations; (2) the plan’s historical investment performance; and (3) best estimates for future investment performance. The obligation attributable to medical benefits is small, as is the future obligation that varies with changes in compensation. Accordingly, changes in the health care trend assumption rate and the compensation increase assumption have an immaterial impact on measuring the obligation.

The investment objectives for the assets associated with the OneSource Pension Plan are to maintain acceptable levels of risk through the diversification of assets among asset classes and to optimize long-term returns. The Company is responsible for selecting investment managers, setting asset allocation targets and monitoring asset allocations and investment performance. The Company’s external investment professionals have the authority to manage assets within pre-established asset allocation ranges set by the Company. The OneSource Pension Plan is the Company’s only funded defined benefit plan.

The target allocation ranges and asset allocations for the year ended October 31, 2011 were:

		September 30,		September 30,
	Target		Percentage of
	Allocation		Plan Assets
Asset Category	2011		2011
Equity		53%-73%		63%
Fixed Income		27%-47%		37%

The following tables presents the Company’s hierarchy for the assets associated with the OneSource Pension Plan measured at fair value as of October 31, 2011 and 2010:

		September 30,		September 30,		September 30,		September 30,
			Fair Value Measurements
	Fair Value at		Using Inputs Considered as
(in thousands)	October 31, 2011		Level 1		Level 2		Level 3

Cash and cash equivalents	$	1,276	$	1,276	$	—	$	—
Equity
Large-Cap Growth		1,090		1,090		—		—
Large-Cap Value		1,090		1,090		—		—
Small/Mid-Cap Growth		140		140		—		—
Small/Mid-Cap Value		140		140		—		—
International Equity		464		464		—		—
Fixed Income
Long-Term Bond		157		157		—		—
Intermediate Bond		789		789		—		—
Short-Term Bond		771		771		—		—

	$	5,917	$	5,917	$	—	$	—

		September 30,		September 30,		September 30,		September 30,
			Fair Value Measurements
	Fair Value at		Using Inputs Considered as
(in thousands)	October 31, 2010		Level 1		Level 2		Level 3

Cash and cash equivalents	$	924	$	924	$	—	$	—
Equity
Large-Cap Growth		1,095		1,095		—		—
Large-Cap Value		1,095		1,095		—		—
Small/Mid-Cap Growth		140		140		—		—
Small/Mid-Cap Value		140		140		—		—
International Equity		466		466		—		—
Fixed Income
Long-Term Bond		159		159		—		—
Intermediate Bond		794		794		—		—
Short-Term Bond		776		776		—		—

	$	5,589	$	5,589	$	—	$	—

Deferred Compensation Plans

The Company accounts for deferred compensation and accrues interest thereon for employees who elect to participate in one of the following Company plans:

Employee Deferred Compensation Plan. This plan is available to executive, management, administrative and sales employees who have an annualized base salary that equals or exceeds $135,000 for the year ended October 31, 2011. This plan allows employees to defer 1% to 50% of their pre-tax compensation. The average rate of interest earned by the employees in this plan was 3.25%, 3.25% and 3.31% for the years ending October 31, 2011, 2010 and 2009, respectively.

Director Deferred Compensation Plan. This plan allows directors to defer receipt of all or any portion of the compensation that he or she would otherwise receive from the Company. The average rate of interest earned by the directors in this plan was 3.25%, 3.25%, and 3.31% for the years ending October 31, 2011, 2010, and 2009, respectively.

The deferred compensation under both the Employee and Director Deferred Compensation Plans earns interest equal to the prime interest rate on the last day of the calendar quarter. If the prime rate exceeds 6%, the interest rate is equal to 6% plus one half of the excess over 6%. Interest earned under both deferred compensation plans is capped at 120% of the long-term applicable federal rate as discussed in the plans.

OneSource Deferred Compensation Plan. The Company acquired OneSource on November 14, 2007, which sponsored a deferred compensation plan. Under this deferred compensation plan, a Rabbi Trust was created to fund the obligation. The plan requires the Company to contribute 50% of the participant’s deferred compensation contributions but only to the extent that the deferred contribution does not exceed 5% of the participant’s compensation for the contribution allocation period. This liability is adjusted, with a corresponding charge (or credit) to the deferred compensation cost, to reflect changes in the fair value. On December 31, 2008, the plan was amended to preclude new participants. The assets held in the rabbi trust are not available for general corporate purposes.

Aggregate expense recognized under these deferred compensation plans for the years ended October 31, 2011, 2010 and 2009 were $0.4 million, $0.4 million and $0.3 million, respectively. The total long-term liability of all deferred compensation plans at October 31, 2011 and 2010 was $15.5 million and $15.3 million (excluding the fair value of the assets held in the Rabbi Trust), respectively, and is included in Retirement plans and other on the accompanying consolidated balance sheet. The fair value of the assets held in the Rabbi Trust at October 31, 2011 and 2010 was $4.7 million and $5.7 million, respectively.

401(k) Plan

The Company has six 401(k) savings plans covering certain employees, as set forth in the respective plan documents. These 401(k) plans are subject to the applicable provisions of ERISA. Certain plans permit a Company match of a portion of the participant’s contributions after the participant has met the eligibility requirements set forth in the plan. The Company made matching 401(k) contributions required by the 401(k) plans during the years ended October 31, 2011, 2010 and 2009 in the amounts of $8.3 million, $6.2 million and $6.2 million, respectively.

Pension Plans Under Collective Bargaining

Certain qualified employees of the Company are covered under union-sponsored multiemployer defined benefit plans. Contributions paid for these plans were $63.2 million, $58.2 million and $47.9 million during the years ended October 31, 2011, 2010 and 2009, respectively. These plans are not administered by the Company and contributions are determined in accordance with provisions of negotiated labor contracts.