NOTE 9 – Employee Benefit Plans

Defined Benefit Plan

We have a contributory defined benefit plan that covers certain employees in the United Kingdom (“U.K.”). The net pension and supplemental retirement benefit obligations and the related periodic costs are based on, among other things, assumptions regarding the discount rate, estimated return on plan assets and mortality rates. These obligations and related periodic costs are measured using actuarial techniques and assumptions. The projected unit credit method is the actuarial cost method used to compute the pension liabilities and related expenses.

For the three months ended September 30, 2016 and 2015 net periodic benefit costs associated with the defined benefit plan were $0.1 million and $0.3 million, respectively. For the nine months ended September 30, 2016 and 2015, net periodic benefit costs associated with the defined benefit plan were $0.2 million and $1.0 million, respectively.

The tables below set forth the benefit obligation, the fair value of plan assets, and the funded status of our plan:

	Defined Benefit Plan
Change in benefit obligation:
Balance at December 31, 2015	$	145,019
Service cost		209
Interest cost		3,965
Actuarial gain		45,103
Benefits paid		(6,543	)
Currency changes		(20,819	)
Benefit obligation at September 30, 2016	$	166,934

Change in plan assets:
Fair value of plan assets at December 31, 2015	$	116,385
Actual return on plan assets		33,922
Employer contribution		278
Benefits paid		(6,543	)
Currency changes		(16,271	)
Fair value of plan assets at September 30, 2016	$	127,771
Underfunded status at September 30, 2016	$	39,163

Based on an actuarial study performed as of September 30, 2016, the plan is underfunded and a liability is reflected in our consolidated financial statements as a long-term liability. The weighted-average discount rate assumption used to determine benefit obligations as of September 30, 2016 was 2.45%.

The following weighted-average assumptions were used to determine net periodic benefit costs for the three months ended September 30, 2016:

Discount rate		4.0	%
Expected long-term return on plan assets		6.0	%

In the first quarter of 2015, based on the pension deficit, we adopted (as required every three years) an amended payment plan with the trustee of the defined benefit plan in which we will pay approximately GBP 2 million (approximately $2.4 million based on a GPB:USD exchange rate of 1.2) annually through 2030.)

We also have pension plans in Germany and Asia for which the benefit obligation, fair value of the plan assets and the funded status amounts are deemed immaterial and therefore, are not included in the figures or assumptions above.

Deferred Compensation

We maintain a Non-Qualified Deferred Compensation Plan (the “Deferred Compensation Plan”) for executive officers, key employees and members of the Board of Directors. The Deferred Compensation Plan allows eligible participants to defer the receipt of eligible compensation, including equity awards, until designated future dates. We offset our obligations under the Deferred Compensation Plan by investing in the actual underlying investments. These investments are classified as trading securities and are carried at fair value. At September 30, 2016, these investments totaled approximately $6.2 million. All gains and losses in these investments are materially offset by corresponding gains and losses in the Deferred Compensation Plan liabilities.