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Standard Register Expects to Reduce Pension Contributions Through 2014

Press release from the issuing company

Standard Register, a leader in the management and execution of mission-critical communications, today provided an update on pension funding expectations for 2012 through 2014 based on provisions of the highway reauthorization legislation signed into law last week.

Standard Register had previously expected pension contributions for 2012 through 2014 to total $112 million. With relief provided by the Moving Ahead for Progress in the 21st Century Act (MAP-21), commonly referred to as the highway bill, the Company expects to reduce the total by approximately $17 million, to $95 million.

      2012     2013     2014     Total
      (Dollars in millions)
Previously expected pension contribution     $ 27     $ 38     $ 47     $ 112
Estimated pension contribution under MAP-21     $ 23     $ 30     $ 42     $ 95
Change     $ 4     $ 8     $ 5     $ 17

MAP-21 provides pension plan sponsors with funding relief by stabilizing interest rates used to determine required funding contributions to defined benefit plans. The new legislation allows the use of a 25-year average corporate bond rate adjusted to the applicable corridor rather than a 2-year average rate as required under the prior law to calculate funding requirements.

“The passage of this pension plan interest rate stabilization is very positive for Standard Register,” said Joseph P. Morgan, Jr., president and chief executive officer. “We are committed to fully funding our pension liability. This short-term funding relief provides us with the ability to use the cash to invest in growing our business and accelerating our strategy.”

Morgan also reinforced that the savings expectations are preliminary estimates. The Internal Revenue Service (IRS) will determine the 25-year average rates on an annual basis and may prescribe equivalent rates for any years in the 25-year period for which segment rates determined under the regular rules are not available. MAP-21 also includes an increase in future Pension Benefit Guarantee Corporation (PBGC) premiums. Standard Register intends to provide updates to these preliminary estimates when details of the legislation are finalized.


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