WeightWatchers 2011 Annual Report Download - page 105

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WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
The Company or one of its subsidiaries files income tax returns in the US federal jurisdiction, and various
state and foreign jurisdictions. At December 31, 2011, with few exceptions, the Company was no longer subject
to US federal, state or local income tax examinations by tax authorities for years prior to 2008, or non-US
income tax examinations by tax authorities for years prior to 2004.
11. Employee Benefit Plans
The Company sponsors the Second Amended and Restated Weight Watchers Savings Plan (the “Savings
Plan”) for salaried and certain hourly US employees of the Company. The Savings Plan is a defined contribution
plan that provides for employer matching contributions up to 100% of the first 3% of an employee’s eligible
compensation that is contributed to the Savings Plan. Expense related to these contributions for the fiscal years
ended December 31, 2011, January 1, 2011 and January 2, 2010 was $2,627, $1,819 and $2,486, respectively.
During fiscal 2011, the Company received a favorable determination letter from the IRS that qualifies the
Savings Plan under Section 401(a) of the Internal Revenue Code.
Pursuant to the Savings Plan, the Company also sponsors a profit sharing plan (the “Profit Sharing Plan”)
for all full-time salaried US employees who are eligible to participate in the Savings Plan (except for certain
senior management personnel). The Profit Sharing Plan provides for a guaranteed monthly employer contribution
on behalf of each participant based on the participant’s age and a percentage of the participant’s eligible
compensation. The Profit Sharing Plan has a discretionary supplemental employer contribution component that is
determined annually by the Compensation and Benefits Committee of the Company’s Board of Directors.
Expense related to these contributions for the fiscal years ended December 31, 2011, January 1, 2011 and
January 2, 2010 was $3,704, $3,157 and $3,361, respectively.
For certain US senior management personnel, the Company sponsors the Amended and Restated Weight
Watchers Executive Profit Sharing Plan (“EPSP”). Under the IRS definition, the EPSP is considered a
Nonqualified Deferred Compensation Plan. There is a promise of payment by the Company made on the
employees’ behalf instead of an individual account with a cash balance. The EPSP provides for a guaranteed
employer contribution on behalf of each participant based on the participant’s age and a percentage of the
participant’s eligible compensation. The EPSP has a discretionary supplemental employer contribution
component that is determined annually by the Compensation and Benefits Committee of the Company’s Board of
Directors. The account is valued at the end of each fiscal month, based on an annualized interest rate of prime
plus 2%, with an annualized cap of 15%. Expense related to this commitment for the fiscal years ended
December 31, 2011, January 1, 2011 and January 2, 2010 was $2,369, $1,719 and $1,620, respectively.
12. Cash Flow Information
December 31,
2011
January 1,
2011
January 2,
2010
Net cash paid during the year for:
Interest expense ............................................ $ 52,591 $71,602 $81,968
Income taxes .............................................. $144,925 $75,389 $86,081
Dividends declared but not yet paid at year-end ....................... $ 13,145 $13,158 $13,786
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