NOTE 1 – CONDENSED FOOTNOTES

As contemplated by the Securities and Exchange Commission (the “Commission”) instructions to Form 10-Q, the following footnotes have been condensed and, therefore, do not contain all disclosures required in connection with annual financial statements. Reference should be made to the Company’s year-end audited consolidated financial statements and notes thereto contained in its Annual Report on Form 10-K for the fiscal year ended December 29, 2013,28, 2014, as filed with the Commission.

The financial information included in this report has been prepared by the Company, without audit. In the opinion of management, the financial information included in this report contains all adjustments (all of which are normal and recurring) necessary for a fair presentation of the results for the interim periods. Nevertheless, the results shown for interim periods are not necessarily indicative of results to be expected for the full year. The December 29, 201328, 2014, consolidated condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. The first quarter of 2015 was comprised of 14 weeks, while the first quarter of 2014 was comprised of 13 weeks. Each of the second quarters of 2015 and 2014 was comprised of 13 weeks.

Certain prior period amounts have been reclassified to conform to the current period presentation.

NOTE 2 – INVENTORIES

Inventories are summarized as follows:

NOTE 3 – EARNINGS (LOSS) PER SHARE

The Company computes basic earnings (loss) per share (“EPS”) by dividing net income (loss) by the weighted average common shares outstanding, including participating securities outstanding, during the period as discussed below.  Diluted EPS reflects the potential dilution beyond shares for basic EPS that could occur if securities or other contracts to issue common stock were exercised, converted into common stock or resulted in the issuance of common stock that would have shared in the Company’s earnings.

The Company includes all unvested stock awards which contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, in the number of shares outstanding in our basic and diluted EPS calculations when the inclusion of these shares would be dilutive. Unvested share-based awards of restricted stock are paid dividends equally with all other shares of common stock. As a result, the Company includes all outstanding restricted stock awards in the calculation of basic and diluted EPS. Distributed earnings include common stock dividends and dividends earned on unvested share-based payment awards. Undistributed earnings represent earnings that were available for distribution but were not distributed. The following tables show distributed and undistributed earnings:

The following tables present net income (loss) that was attributable to participating securities:

The weighted average shares outstanding for basic and diluted EPS were as follows:

For the three-month period ended September 28, 2014, no stock options have been included in the calculation of diluted EPS as the Company was in a net loss position and inclusion of these stock options would have been anti-dilutive. For all other periods presented, all outstanding stockthere were no options have been included inor participating securities excluded from the calculationcomputation of diluted EPS.

NOTE 4 – LONG-TERM DEBT

7.625%7.625% Senior Notes

As of September 28,June 29, 2014, and September 29, 2013, the Company had outstanding $247.5 million and $275.0 million in 7.625% Senior Notes due 2018 (the “7.625% Senior Notes”), respectively.. These notes were redeemed in their entirety in the fourth quarter of 2014. The estimated fair value of the 7.625% Senior Notes as of September 28,June 29, 2014, and September 29, 2013, based on then current market prices, was $257.4 million and $298.4 million, respectively.$259.9 million.

On October 10, 2014, subsequent to the end of the third quarter, the Company elected to redeem $27.5 million aggregate principal amount of 7.625% Senior Notes at a price equal to 103% of the principal amount of the notes redeemed, plus accrued interest to the redemption date of November 26, 2014. On October 17, 2014, the Company elected to redeem the remaining $220 million aggregate principal amount of 7.625% Senior Notes that had not previously been called for redemption, at a price equal to 103.813% of the principal amount of the notes redeemed, plus accrued interest to the redemption date of December 1, 2014.

11.375% Senior Secured NotesSyndicated Credit Facility

As of September 29, 2013, the Company had outstanding $8.1 million in 11.375% Senior Secured Notes due 2013 (the “11.375% Senior Secured Notes”). The estimated fair value of the 11.375% Senior Secured Notes as of September 29, 2013, based on then current market prices, was $8.1 million. The Company repaid the $8.1 million balance of these notes at maturity in November 2013.

Credit Facilities

On October 22, 2013, the Company entered intohas a Syndicated Facility Agreement among the Company, certain wholly-owned foreign subsidiaries of the Company as borrowers, certain subsidiaries of the Company as guarantors, Bank of America, N.A. as Administrative Agent, The Royal Bank of Scotland, as Syndication Agent, SunTrust Bank and Regions Bank, as Co-Documentation Agents, and the other lenders party thereto. Pursuantsyndicated credit facility (the “Facility”) pursuant to the Syndicated Facility Agreement,which the lenders provide to the Company and certain of its subsidiaries a multicurrency revolving credit facility (the “Syndicated Credit Facility”)and provide to the Company a term loan. The facility matures in October of up to $200 million2019. Interest on base rate loans is charged at any one time.varying rates computed by applying a margin depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. Interest on LIBOR-based loans and fees for letters of credit are charged at varying rates computed by applying a margin over the applicable LIBOR rate, depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter. In addition, the Company pays a commitment fee per annum (depending on the Company’s consolidated net leverage ratio as of the most recently completed fiscal quarter) on the unused portion of the Facility.

As of September 28, 2014,July 5, 2015, the Company had $28.0$200 million of term loan borrowing and $59.1 million of revolving loan borrowings outstanding under the Syndicated Credit Facility, with a weighted average interest rate of approximately 4.5%, and had $3.3$3.1 million in letters of credit outstanding under the Syndicated Credit Facility. As of September 28, 2014,July 5, 2015, the Company could have incurred $168.7 million of additionalweighted average interest rate on borrowings outstanding under the Syndicated Credit Facility.Facility was 1.9%.

On October 3, 2014, subsequentThe Company is required to the end of the third quarter, the Company amended the Syndicated Facility Agreement. The amendment expands the aggregate borrowing availability for revolving loans under the Syndicated Credit Facility from $200 million to $250 million, provides for up to $200 million of new Term Loan A borrowing availability which may be used to repurchase or redeem (before December 31, 2014) the Company’s 7.625% Senior Notes, and extends the maturity of the Syndicated Credit Facility to October 3, 2019. The amendment provides for requiredmake amortization payments of any Term Loan A borrowing, as well as mandatory prepayments of any Term Loan A borrowing (and anythe term loans made available pursuant to any future multicurrency loan facility increase) from certain asset sales, casualty events and debt issuances, subject to certain qualifications and exceptions as provided for therein. Pursuant toborrowing. The amortization payments are due on the amendment, the Company has the option to further increase (in the future) the borrowing availability under the Syndicated Credit Facility, either for revolving loans or term loans, by up to $150 million, subject to the receipt of lender commitments for such increase and the satisfaction of certain other conditions. All other termslast day of the Syndicated Credit Facility, including covenants, interest rates and fees, eventscalendar quarter, commencing with an initial amortization payment of default and collateral, remain substantially unchanged.$2.5 million on December 31, 2015. The quarterly amortization payment amount increases to $3.75 million on December 31, 2016. 

The Company is currently in compliance with all covenants under the Syndicated Credit Facility and anticipates that it will remain in compliance with the covenants for the foreseeable future.

Other non-U.S. subsidiariesLines of Credit

Subsidiaries of the Company have an aggregate of the equivalent of $8.4$19.0 million of other lines of credit available.available at interest rates ranging from 2% to 6%. As of September 28, 2014,July 5, 2015, there were no borrowings outstanding under these lines of credit.

NOTE 5 – STOCK-BASED COMPENSATION

Stock OptionAwards

In accordance with accounting standards, the Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. That cost will be recognized over the period in which the employee is required to provide the services – the requisite service period (usually the vesting period) – in exchange for the award. The grant date fair value for options and similar instruments will be estimated using option pricing models. Under accounting standards, the Company is required to select a valuation technique or option pricing model that meets the criteria stated in the standard. The Company uses the Black-Scholes model. Accounting standards require that the Company estimate forfeitures for stock options and reduce compensation expense accordingly. The Company has reduced its stock compensation expense by the assumed forfeiture rate and will evaluate experience against this forfeiture rate going forward.

During the first nine months of 2013, the Company recognized stock option compensation expenses of $0.1 million. All outstanding stock options vested prior to 2014,the end of 2013, and therefore there have beenwas no stock option compensation expenses during 2014.expense in 2014 or 2015.

There were no stock options granted in 2014 or 2015. The following table summarizes stock options outstanding as of September 28, 2014,July 5, 2015, as well as activity during the ninesix months then ended:

At September 28, 2014,July 5, 2015, the aggregate intrinsic value of both in-the-money options outstanding and options exercisable was $1.2$1.4 million (the intrinsic value of a stock option is the amount by which the market value of the underlying stock exceeds the exercise price of the option).

Cash proceeds and intrinsic value related to total stock options exercised during the first ninesix months of fiscal years2015 and 2014 and 2013 are provided in the table below. The Company did not recognize any significant tax benefit with regard to stock options in either period presented.

Restricted Stock Awards

During the ninesix months ended September 28,July 5, 2015, and June 29, 2014, and September 29, 2013, the Company granted restricted stock awards for 490,000597,000 and 670,000490,000 shares, respectively, of common stock. TheseRestricted stock awards (or a portion thereof) vest with respect to each recipient over a two to five year period from the date of grant, provided the individual remains in the employment or service of the Company as of the vesting date. Additionally, awards (or a portion thereof) could vest earlier upon the attainment of certain performance criteria, in the event of a change in control of the Company, or upon involuntary termination without cause.

Compensation expense related to restricted stock awardsgrants was $3.0$9.1 million and $5.0$2.7 million for the ninesix months ended September 28,July 5, 2015, and June 29, 2014, and September 29, 2013, respectively. Accounting standards require that the Company estimate forfeitures for restricted stock and reduce compensation expense accordingly. The Company has reduced its expense by the assumed forfeiture rate and will evaluate experience against this forfeiture rate going forward.

The following table summarizes restricted stock awards outstandingactivity as of September 28, 2014,July 5, 2015, and activity during the ninesix months then ended:

As of September 28, 2014,July 5, 2015, the unrecognized total compensation cost related to unvested restricted stock was approximately $11.5$14.3 million. That cost is expected to be recognized by the end of 2017.2019.

For the ninesix months ended September 28,July 5, 2015, and June 29, 2014, and September 29, 2013, the Company recognized tax benefits with regard to restricted stock of $0.6$3.5 million and $2.0$0.7 million, respectively.

NOTE 7 – SEGMENT INFORMATION

Based on applicable accounting standards, the Company has determined that it has three operating segments – namely, the Americas, Europe and Asia-Pacific geographic regions. Pursuant to accounting standards, the Company has aggregated the three operating segments into one reporting segment because they have similar economic characteristics, and the operating segments are similar in all of the following areas: (a) the nature of the products and services; (b) the nature of the production processes; (c) the type or class of customer for their products and services; (d) the methods used to distribute their products or provide their services; and (e) the nature of the regulatory environment.

NOTE 8 – SUPPLEMENTAL CASH FLOW INFORMATION

Cash payments for interest amounted to $3.3 million and $9.9 million for the six months ended July 5, 2015, and June 29, 2014, respectively. Income tax payments amounted to $3.5 million and $4.0 million for the six months ended July 5, 2015, and June 29, 2014, respectively.

NOTE 9 – RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In January 2015, the Financial Accounting Standards Board (“FASB”) issued an accounting standard which eliminates the concept of extraordinary items from generally accepted accounting principles. The standard does not affect disclosure guidance for events or transactions that are unusual in nature or infrequent in their occurrence. The standard is effective for interim and annual periods in fiscal years beginning after December 15, 2015. The standard allows prospective or retrospective application. Early adoption is permitted if applied from the beginning of the fiscal year of adoption. We do not believe the adoption of this standard will have any significant effect on our ongoing financial reporting.

In February 2015, the FASB issued an accounting standard which changes the way reporting enterprises evaluate whether (a) they should consolidate limited partnerships and similar entities, (b) fees paid to a decision maker or service provider are variable interests in a variable interest entity (“VIE”), and (c) variable interests in a VIE held by related parties of the reporting enterprise require the reporting enterprise to consolidate the VIE. The new accounting standard is effective for annual and interim periods in fiscal years beginning after December 15, 2015. We are currently evaluating the impact, if any, this standard will have on our ongoing financial reporting, but we do not believe the adoption of this standard will have any significant effect on our ongoing financial reporting.

NOTE 10 – INCOMETAXES

Accounting standards require that all tax positions be analyzed using a two-step approach. The first step requires an entity to determine if a tax position is more-likely-than-not to be sustained upon examination. In the second step, the tax benefit is measured as the largest amount of benefit, determined on a cumulative probability basis, that is more-likely-than-not to be realized upon ultimate settlement. In the first six months of 2015, the Company decreased its liability for unrecognized tax benefits by $0.1 million. As of July 5, 2015, the Company had accrued approximately $27.2 million for unrecognized tax benefits. In accordance with applicable accounting standards, the Company’s deferred tax asset as of July 5, 2015 reflects a reduction for $21.9 million of these unrecognized tax benefits.

NOTE 11 – ITEMS RECLASSIFIED FROM OTHER COMPREHENSIVE INCOME

During the first six months of 2015, the Company did not reclassify any significant amounts out of accumulated other comprehensive income. The reclassifications that occurred in that period were primarily comprised of $0.8 million related to the Company’s defined retirement benefit plan and salary continuation plan. These reclassifications were included in the selling, general and administrative expenses line item of the Company’s consolidated condensed statement of operations.

NOTE 12 – 2014 RESTRUCTURING CHARGEPLAN

In the third quarter of 2014, the Company committed to a new restructuring plan in its continuing efforts to reduce costs across its worldwide operations. In connection with this restructuring plan, the Company incurred a pre-tax restructuring and asset impairment charge in the third quarter of 2014 in an amount of $12.4 million. The charge was comprised of severance expenses of $9.7 million for a reduction of 100 employees, other related exit costs of $0.1 million, and a charge for impairment of assets of $2.6 million. Approximately $10 million of the charge will result in cash expenditures, primarily severance expense.

A summary of these restructuring activities is presented below:

NOTE 9 – SUPPLEMENTAL CASH FLOW INFORMATION

Cash payments for interest amounted to $10.6 million and $11.6 million for the nine months ended September 28, 2014, and September 29, 2013, respectively. Income tax payments amounted to $5.8 million and $7.1 million for the nine months ended September 28, 2014, and September 29, 2013, respectively.

NOTE 1013 – RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In May 2014, the Financial Accounting Standards Board (“FASB”) issued an accounting standard regarding recognition of revenue from contracts with customers. In summary, the core principle of this standard is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, and early application is not permitted. While the Company is currently reviewing this new standard, it is not expected that the adoption of this guidance will have a material impact on our financial condition or results of operations.

In July 2013, the FASB issued an accounting standard regarding the presentation of unrecognized tax benefits when a net operating loss carryforward, or similar tax credit carryforward, exists. This standard clarifies that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, if such settlement is required or expected in the event the uncertain tax benefit is disallowed. In situations where a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, is not available at the reporting date under the tax law of the applicable jurisdiction or the tax law of the jurisdiction does not require, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be netted with the deferred tax asset. The Company implemented this standard in the first quarter of 2014, which resulted in reductions of deferred tax asset (long-term) and long-term other liabilities of approximately $21.8 million each. Pursuant to this standard, the Company also adjusted its December 29, 2013 consolidated balance sheet, resulting in decreases in its deferred tax asset (long-term) and long-term other liabilities of approximately $21.8 million each.

NOTE 11 – INCOMETAXESREPURCHASE OF COMMON STOCK

In the firstfourth quarter of 2013,2014, the Company executed advance pricing agreements for tax years 2006 through 2011announced a program to repurchase up to 500,000 shares of common stock per fiscal year, commencing with the Canada Revenue Agency and the U.S. Internal Revenue Service in relation to the U.S. bilateral advanced pricing agreement filed in 2008. As a result of executing the advance pricing agreements, the Company was able to reduce its liability for unrecognized tax benefits in2014 fiscal year. During the first quarter of 2013 by $1.9 million. This benefit has been included in2015, the “Income Tax Expense (Benefit)” lineCompany repurchased and retired 250,000 shares of common stock at a weighted average purchase price of $19.39 per share. During the Company’s consolidated condensed statementsecond quarter of operations for2015, the nine months ended September 29, 2013.Company repurchased and retired 250,000 shares of common stock at a weighted average purchase price of $22.41 per share.