Sunbeam 2004 Annual Report Download - page 65

Jarden Corporation
Notes to Consolidated Financial Statements (cont’d)
December 31, 2004
The American Jobs Creation Act of 2004 (“Act”) introduced a special one-time dividends received
deduction on the repatriation of certain foreign earnings to a United States taxpayer (“Repatriation
Provision”), provided certain criteria are met. The Act provides an 85% dividends received deduction of
certain foreign earnings that are repatriated (as defined in the Act) in either the enterprise’s last tax
year that began before October 22, 2004 (“the Enactment Date”) or the first tax year that begins during
the one-year period beginning on the Enactment Date. The Company has not completed its evaluation
of the effects of the Repatriation Provision, although it does expect such evaluation to be completed by
the third quarter of 2005. Since the Company has not completed its evaluation of the effects of such
Repatriation Provision, the potential range of income tax effects of such Repatriation Provision cannot
be reasonably estimated prior to the issuance of the Company’s Consolidated Financial Statements. As a
result, the Company has not provided United States income taxes on undistributed foreign earnings of
approximately $13.5 million at December 31, 2004.
Total income tax payments made by the Company during the years ended December 31, 2004, 2003
and 2002 were $17.0 million, $11.2 million and $9.3 million, respectively.
10. Retirement and Other Employee Benefit Plans
The Company has certain defined contribution retirement plans that qualify under Section 401(k)
of the Internal Revenue Code. The Company’s contributions to these retirement plans were $3.1
million, $2.3 million and $1.6 million in the years ended December 31, 2004, 2003 and 2002,
respectively.
The Company also maintains a defined benefit pension plan for certain of its hourly employees and
provides certain postretirement medical and life insurance benefits for a portion of its employees. In
2004, in connection with the USPC Acquisition, the Company acquired both the plan assets and the
benefit obligation on a defined benefit plan that covers all eligible non-union employees of USPC as well
as the benefit obligation of a postretirement medical and life insurance plan for USPC. Additionally, in
2003, in connection with the Diamond Acquisition, the Company acquired both the plan assets and the
remaining benefit obligation on two additional deferred benefit pension plans which are both frozen.
The funding policy for the Company’s defined benefit pension plans is based on actuarial
calculations and the applicable requirements of federal law. Benefits under the Company’s pension
plans are primarily related to years of service. The Company uses September 30 as the measurement date
for all of its defined pension plans and postretirement plans.
The components of net periodic pension and postretirement benefit expense for the years ended
December 31, 2004, 2003 and 2002 are as follows:
Pension Benefits Postretirement Benefits
(thousands of dollars) 2004 2003 2002 2004 2003 2002
Components of net periodic benefit cost:
Service cost ................................. $ 697 $ 304 $ 334 $168 $ 75 $ 72
Interest cost ................................. 2,158 1,419 973 339 194 119
Expected return on plan assets ................. (2,175) (1,143) (975) ———
Net amortization ............................. 314 250 114 2 2 (7)
Net periodic benefit cost ...................... $ 994 $ 830 $ 446 $509 $271 $184
63