LensCrafters 2008 Annual Report Download - page 88

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> 86 |ANNUAL REPORT 2008
Upon the acquisition of Oakley, effective November 14, 2007, the Company also sponsors a tax incentive
savings plan for all United States Oakley associates with at least six months of service. This plan is funded
by employee contributions with the Company matching a portion of the employee contribution. Company
contributions to the plan for fiscal 2008 and for the period November 14, 2007 through December 31, 2007,
were Euro 1.2 million and Euro 0.1 million, respectively.
The Company sponsors the following additional other benefit plans, which cover certain present and past
employees of the Cole companies acquired:
•Cole provides, under individual agreements, postemployment benefits for continuation of health care
benefits and life insurance coverage to former employees after employment. As of December 31, 2008
and 2007, the accrued liability, related to these benefits, was Euro 0.7 million and Euro 1.0 million,
respectively, and is included in “other long term liabilities” on the consolidated balance sheet.
•The Company sponsors a tax incentive savings plan covering all full-time employees in Puerto Rico. The
Company makes quarterly contributions in cash to the plan based on a percentage of employee’s
contributions. The Company may make an annual discretionary contribution to the plan, which may be
made in the Parent Company’s ADRs or cash. In 2008 and 2007, contributions to the plan were
immaterial. For fiscal 2008 and 2007, these contributions did not include a discretionary match.
•Cole established and maintains the Cole National Group, Inc. Supplemental Retirement Benefit Plan,
which provides supplemental retirement benefits for certain highly compensated and management
employees who were previously designated by the former Board of Directors of Cole as participants.
This is an unfunded noncontributory defined contribution plan. Each participant’s account is credited
with interest earned on the average balance during the year. This plan was frozen as to future salary
credits on the effective date of the Cole acquisition in 2004. The plan liability of Euro 1.0 million and Euro
1.0 million at December 31, 2008 and 2007, respectively, is included in “other long term liabilities” on the
consolidated balance sheets.
Other defined contribution plan. The Company continues to participate in superannuation plans in
Australia and Hong Kong. The plans provide benefits on a defined contribution basis for employees on
retirement, resignation, disablement or death. Contributions to defined contribution superannuation
plans are recognized as an expense as the contributions are paid or become payable to the fund.
Contributions are accrued based on legislated rates and annual compensation.
Certain employees of the Company located outside the United States are covered by state sponsored
postemployment benefit plans. These plans are generally funded in conformity with the applicable local
government regulations and amounts are expensed as contributions accrue. The aggregate liability to the
Company for these foreign postemployment benefit plans as of December 31, 2008 and 2007, was immaterial.
Health benefit plans. The Company partially subsidizes health care benefits for U.S. eligible retirees.
Employees generally become eligible for retiree health care benefits when they retire from active service
between the ages of 55 and 65. Benefits are discontinued at age 65.
As of the Cole acquisition date, the Company assumed a liability for a postretirement benefit plan
maintained by Cole in connection with its acquisition of Pearle in 1996. This plan was closed to new
participants at the time of Cole’s acquisition of Pearle. Under this plan, the eligible former employees are
provided life insurance and certain health care benefits, which are partially subsidized by Cole. Medical
benefits under this plan can be maintained past age 65. Effective January 1, 2008, the Cole postretirement
benefit plan was merged into the Luxottica Group Postretirement Medical Benefits Program (“Lux
Postretirement Plan”). The projected benefit obligation transferred on such date was Euro 2.2 million.
Upon the merger, there were no changes to provisions of the Lux Postretirement Plan.
Amounts recognized in the consolidated balance sheets as of December 31, 2008 and 2007, consist of the
following (thousands of Euro):