Baskin Robbins 2012 Annual Report Download - page 99

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-89-
The actuarial assumptions used in determining the present value of accrued pension benefits at December 29, 2012 and
December 31, 2011 were as follows:
December 29,
2012
December 31,
2011
Discount rate 2.70% 5.25%
Average salary increase for pensionable earnings — 3.25
The reduction in the discount rate used in determining the present value of accrued pension benefits at December 29, 2012
resulted from the termination of the plan as of that date and, therefore, reflects the estimate of the rate at which pension benefits
could be effectively settled. Additionally, no future salary increases are assumed as of December 29, 2012 as a result of the
termination of the plan.
The actuarial assumptions used in determining the present value of our net periodic benefit cost were as follows:
December 29,
2012
December 31,
2011
December 25,
2010
Discount rate 5.25% 5.50% 6.00%
Average salary increase for pensionable earnings 3.25 3.25 3.25
Expected return on plan assets 6.00 6.00 6.50
The expected return on plan assets was determined based on the Canadian Pension Plan’s target asset mix, expected long-term
asset class returns based on a mean return over a 30-year period using a Monte Carlo simulation, the underlying long-term
inflation rate, and expected investment expenses.
The accumulated benefit obligation was $8.3 million and $5.1 million at December 29, 2012 and December 31, 2011,
respectively. We recognize a net liability or asset and an offsetting adjustment to accumulated other comprehensive income to
report the funded status of the Canadian Pension Plan.
The Company anticipates contributing approximately $259 thousand to this plan in 2013. Upon approval of the plan
termination by the FSCO, the Company intends on funding the plan deficit and purchasing annuities to provide accrued
benefits to participants. Expected benefit payments for the next five years and thereafter, assuming no plan termination, would
be as follows (in thousands):
Fiscal year:
2013 $ 241
2014 237
2015 233
2016 259
2017 253
Thereafter 1,415
$ 2,638
(19) Related-party transactions
(a) Sponsors
Through the first quarter of fiscal year 2012, DBGI was majority-owned by investment funds affiliated with Bain Capital
Partners, LLC, The Carlyle Group, and Thomas H. Lee Partners, L.P. (collectively, the “Sponsors” or "BCT").
In April 2012, certain existing stockholders, including the Sponsors, sold a total of 30,360,000 shares of our common stock (see
note 13(a)). In August 2012, the Sponsors sold all of their remaining shares through a registered offering and related repurchase
of shares by the Company (see notes 13(a) and 13(c)). One representative of each Sponsor continues to serve on the board of
directors.
Prior to the closing of the Company’s initial public offering on August 1, 2011, the Company was charged an annual
management fee by the Sponsors of $1.0 million per Sponsor, payable in quarterly installments. In connection with the
completion of the initial public offering in August 2011, the Company incurred an expense of approximately $14.7 million
related to the termination of the Sponsor management agreement. Including this termination fee, the Company recognized