Retirement Plans

Pension Plans: The Company currently has two defined benefit pension plans for certain of its employees in the United States. The defined benefit plans provide benefit payments using formulas based on an employee's compensation and length of service, or stated amounts for each year of service. The Company expects to continue to fund these plans based on governmental requirements, amounts deductible for income tax purposes and as needed to ensure that plan assets are sufficient to satisfy plan liabilities. The benefits under the Company’s defined benefit pension plans are frozen.

Supplemental Executive Retirement Plans: The Company has various supplemental executive retirement plans ("SERP"), which provide benefits to certain former directors and executives. For accounting purposes, these plans are unfunded; however, one plan utilizes income from annuities to offset a portion of the cost of the plan. These annuities are included in other assets, net in the consolidated balance sheets and are not netted against the plan's benefit obligation. Additionally, the income or loss from the annuities are not reflected in net periodic expense related to the plan.

Other Postretirement Plans: The Company has various other postretirement benefit plans ("OPEB"), primarily focused on postretirement healthcare, such as medical insurance and life insurance and related benefits for certain of its former employees and, in some instances, their spouses. Benefits, eligibility and cost-sharing provisions vary by plan documents or union collective bargaining arrangements.

Savings Plan: The Company sponsors a defined contribution plan to provide substantially all United States salaried and certain hourly employees an opportunity to accumulate personal funds for their retirement. The Company contributed $0.5 million, $0.5 million and $0.3 million to the plan in 2015, 2014 and 2013, respectively, for certain union employees. Employees participating in the plan held 2,210,499 shares of the Company’s common stock as of the year ended 2015.

Funded Status and Net Periodic Cost: The following tables provide a reconciliation of the changes in the Company’s pension, SERP and OPEB plans' benefit obligations and fair value of assets for 2015 and 2014, a statement of the funded status as of the years ended 2015 and 2014, respectively, and the amounts recognized in the consolidated balance sheets as of the years ended 2015 and 2014 (in thousands).



	Pensions						SERPs						OPEBs
	2015			2014			2015			2014			2015			2014
Benefit obligation at beginning of year	$	365,326		$	319,151		$	18,508		$	17,824		$	1,789		$	2,075
Service cost	—			—			—			—			2			2
Interest cost	13,341			14,027			656			754			63			88
Actuarial (gain) loss	(14,715		)	55,821			(94		)	1,925			(274		)	(254		)
Benefits paid	(18,051		)	(23,673		)	(2,072		)	(1,995		)	(76		)	(122		)
Benefit obligation at end of year	$	345,901		$	365,326		$	16,998		$	18,508		$	1,504		$	1,789

The following table provides a reconciliation of the Company’s fair value of plan assets:



	Pensions						SERPs						OPEBs
	2015			2014			2015			2014			2015			2014
Fair value of plan assets at beginning of year	$	267,635		$	260,917		$	—		$	—		$	—		$	—
Actual return on plan assets	(6,610		)	18,466			—			—			—			—
Employer contributions	4,545			11,925			2,072			1,995			76			122
Benefits paid	(18,051		)	(23,673		)	(2,072		)	(1,995		)	(76		)	(122		)
Fair value of plan assets at end of year	$	247,519		$	267,635		$	—		$	—		$	—		$	—

The following table shows the funded status at the end of the year:



	Pensions						SERPs						OPEBs
	2015			2014			2015			2014			2015			2014
Funded status at end of year	$	(98,382	)	$	(97,691	)	$	(16,998	)	$	(18,508	)	$	(1,504	)	$	(1,789	)

The following table shows amounts recognized in AOCI:



	Pensions				SERPs				OPEBs
	2015		2014		2015		2014		2015			2014
Net actuarial loss (gain)	$	119,712	$	115,438	$	5,438	$	5,872	$	(1,045	)	$	(830	)
Prior service cost	—		—		—		—		44			44
Total	$	119,712	$	115,438	$	5,438	$	5,872	$	(1,001	)	$	(786	)

The following table shows amounts recognized in the consolidated balance sheets:



	Pensions				SERPs				OPEBs
	2015		2014		2015		2014		2015		2014
Other current liabilities	$	—	$	—	$	1,967	$	1,989	$	130	$	164
Other liabilities	98,382		97,691		15,031		16,519		1,374		1,625
Total liabilities	$	98,382	$	97,691	$	16,998	$	18,508	$	1,504	$	1,789

The following table provides components of the net periodic cost for the pension, SERP and OPEB plans for the years ended 2015, 2014 and 2013 (in thousands):



	For The Years Ended
	2015			2014			2013
Service cost	$	2		$	2		$	—
Interest cost	14,061			14,870			13,716
Expected return on plan assets	(20,976		)	(20,792		)	(18,455		)
Net amortization and deferral	—			—			(6		)
Recognized net actuarial loss	8,877			3,220			7,779
Net periodic expense (benefit)	$	1,964		$	(2,700	)	$	3,034

Interest cost on projected benefit obligation includes $0.7 million, $0.8 million and $0.8 million related to the Company’s SERP and OPEB plans in 2015, 2014 and 2013, respectively.

The pre-tax amount of actuarial losses in AOCI as of the year ended 2015 that are expected to be recognized in net periodic benefit cost in 2016 is $9.7 million for defined benefit pension plans and $0.2 million for other postretirement benefit plans, including SERP. The pre-tax amount of prior service cost included in AOCI as of the year ended 2015 that is expected to be recognized in net periodic benefit cost in 2016 is zero for all defined benefit plans.

The assumptions used were as follows:



	2015		2014		2013
Discount rate used to calculate net periodic benefit expense	3.75	%	4.50	%	3.75	%
Discount rate used to calculate projected benefit obligation	4.00	%	3.75	%	4.50	%
Expected long-term rate of return on plan assets	8.00	%	8.00	%	8.00	%
Rate of compensation increase	n/a		n/a		n/a

The discount rate assumption used to determine the Company’s pension obligations as of the years ended 2015 and 2014 takes into account the projected future benefit cash flow and the underlying individual yields in the Citigroup Pension Liability Index that would be available to provide for the payment of those benefits. The ultimate rate is developed by calculating an equivalent discounted present value of the benefit cash flow as of the years ended 2015 and 2014, respectively, using a single discount rate rounded to the nearest quarter percent.

The expected long-term rate of return on plan assets of 8.0% for the years ended 2015 and 2014 was based on historical returns and the expectations for future returns for each asset class in which plan assets are invested as well as the target asset allocation of the investments of the plan assets.

The projected benefit obligation, accumulated benefit obligation and fair value of plan assets for the Company’s pension plans with accumulated benefit obligations in excess of plan assets were as follows (in thousands):



	2015		2014
Projected benefit obligation	$	362,899	$	383,834
Accumulated benefit obligation	362,899		383,834
Fair value of plan assets	247,519		267,635

The Company currently expects to contribute less than $0.1 million to its pension plans in 2016.

The estimated pension benefit payments expected to be paid by the pension plans and the estimated SERP and OPEB payments expected to be paid by the Company for the years 2016 through 2020, and in the aggregate for the years 2021 through 2025, are as follows (in thousands):



	Pension Plans		SERP		OPEB
2016	$	17,867	$	2,006	$	133
2017	18,122		1,870		129
2018	18,609		1,707		126
2019	19,001		1,642		122
2020	19,356		1,574		118
2021 through 2025	101,485		6,680		526

Fair Value of Assets: The Company's investment objective is to maximize the long-term return on its pension plan assets within prudent levels of risk. Investments are primarily diversified with a blend of equity securities, fixed income securities and alternative investments. The intent is to minimize plan expenses by outperforming plan liabilities over the long run.

The Company segregated its plan assets by the following major categories and levels for determining their fair values as of the years ended 2015 and 2014:

Cash and cash equivalents - Carrying value approximates fair value. As such, these assets were classified as Level 1.

Equity - Equity investments are diversified by including United States and non-United States stocks, growth stocks, value stocks and stocks of large and small companies. The values of individual equity securities are based on quoted prices in active markets and are classified as Level 1.

Fixed income - Fixed income securities are primarily United States governmental and corporate bonds including mutual funds. The Company invests in certain fixed income funds that were priced in active markets and were classified as Level 1. The Company also invests in certain fixed income securities that are priced based on valuation models rather than a last trade basis and are not exchange-traded and are classified as Level 2.

Other - The Company also invests in group annuity contracts, which are invested in certain fixed income securities and are classified as Level 2.

Alternative investments - Alternative investments are primarily private equity hedge funds and hedge fund-of-funds. The fair value of alternative investments has been estimated using their Net Asset Values ("NAV") as reported by the investment manager of the respective alternative investment funds. NAV reported by the hedge funds is used as a practical expedient to estimate the fair value. The investment manager values these investments on a periodic basis with models that use market, income and valuation methods. The valuation inputs are not highly observable, and these investments are not actively traded in an open market. These investments were classified as Level 3.

The methods described above may produce a fair value calculation that may not be indicative of net realizable value, or reflective of future fair values. While the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement. The Company invests in various assets in which valuation is determined by NAV. The Company believes that the NAV is representative of fair value, as there are no significant restrictions on redemption on these investments or other reasons that indicate the investment would be redeemed at an amount different than the NAV.

The fair values of the Company’s pension plan assets as of the years ended 2015 and 2014, by asset category are as follows (in thousands):



	2015								2014
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Cash and cash equivalents	$	12,306	$	—	$	—	$	12,306	$	6,661	$	—	$	—	$	6,661
Equity	120,953		—		—		120,953		133,833		—		—		133,833
Fixed income	12,497		49,993		—		62,490		16,696		50,203		—		66,899
Other	—		1,489		—		1,489		—		1,599		—		1,599
Alternative investments	—		—		50,281		50,281		—		—		58,643		58,643
Total pension plan assets	$	145,756	$	51,482	$	50,281	$	247,519	$	157,190	$	51,802	$	58,643	$	267,635

The following table provides a summary of changes in the fair value of the Company’s Level 3 assets (in thousands):



	Alternative Investments
Balance as of the year ended 2013	$	53,116
Asset sales ⁽¹⁾	(2,884		)
Asset purchases	2,884
Unrealized gains	5,527
Balance as of the year ended 2014	58,643
Asset sales ⁽¹⁾	(7,010		)
Asset purchases	—
Unrealized losses	(1,352		)
Balance as of the year ended 2015	$	50,281

__________________________

(1) Gains (losses) of approximately $2.5 million and ($0.1 million) were realized on sales during 2015 and 2014, respectively.

The range of asset allocations and the target allocations for the pension plan assets were as follows:



	2015				2014				Target
Equity securities	49	%	62	%	48	%	62	%	60	%	75	%
Fixed income securities	29	%	33	%	26	%	33	%	25	%	35	%
Alternative investments and other	5	%	22	%	5	%	26	%	10	%	30	%

Multi-Employer Pension Plans: Certain of the Company’s union employees are included in multi-employer pension plans ("Multi-Employer Pension Plans"), to which the Company makes contributions in accordance with contractual union agreements. Such contributions are made on a monthly basis in accordance with the requirements of the plans and the actuarial computations and assumptions of the administrators of the plans. Contributions to Multi-Employer Pension Plans were $0.6 million, $0.4 million and $1.1 million in 2015, 2014 and 2013, respectively. In 2015, 2014 and 2013, the Company recorded expenses of $5.0 million, $1.3 million, and $0.5 million, respectively, as a result of exiting certain Multi-Employer Pension Plans in connection with its cost savings and restructuring plans.

The Company's participation in these plans for the years ended 2015, 2014 and 2013, is outlined in the table below:



Pension Fund	EIN	Pension Plan Number	Pension Protection Act Reported Status (1)		FIP/RP Status (2)	Contributions						Surcharge imposed	Expiration Date of Collective Bargaining Agreement
			2015	2014		2015		2014		2013
						(in thousands)
GCC/IBT National Pension Fund	526118568	001	Red	Red	Implemented	$219		$220		$262		No	6/30/2016
GCC/IBT National Pension Fund	526118568	001	Red	Red	Implemented	177		135		100		No	2/26/2017
GCC/IBT National Pension Fund	526118568	001	Red	Red	Implemented	—		11		14		No	4/30/2017
CWA/ITU Negotiated Pension Plan	136212879	001	Red	Red	Implemented	158		—		88		No	3/1/2018
				Total contributions		$	554	$	366	$	1,143

__________________________

(1)

Unless otherwise noted, the most recent Pension Protection Act ("PPA") zone status available in 2015 and 2014 is for the plan's year end, not the Company's year end. 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.


(2)	The FIP/RP Status column indicates plans for which a financial improvement plan ("FIP") or a rehabilitation plan ("RP") is either pending or has been implemented.