Defined Benefit Plans

Maxwell SA Pension Plan

Maxwell SA has a retirement plan that is classified as a defined benefit pension plan. The employee pension benefit is based on compensation, length of service and credited investment earnings. The plan guarantees both a minimum rate of return as well as minimum annuity purchase rates. The Company’s funding policy with respect to the pension plan is to contribute the amount required by Swiss law, using the required percentage applied to the employee’s compensation. In addition, participating employees are required to contribute to the pension plan. This plan has a measurement date of December 31.

Components of net pension cost are as follows (in thousands):



	Three Months Ended March 31,
	2018			2017
Service cost	$	321		$	241
Cost recognized as a component of compensation cost	321			241
Interest cost	60			56
Expected return on plan assets	(334		)	(247		)
Prior service cost amortization	24			36
Net cost recognized in other components of defined benefit plans, net	(250		)	(155		)
Net pension cost	$	71		$	86

Employer contributions of $0.2 million were paid during each of the three months ended March 31, 2018 and 2017. Additional employer contributions of approximately $0.4 million are expected to be paid during the remainder of fiscal 2018.

Korea Defined Benefit Plan

In connection with the Nesscap Acquisition, the Company assumed the defined benefit plan liability related to Nesscap Korea’s employees. Pursuant to the Labor Standards Act of Korea, employees and most executive officers with one or more years of service are entitled to lump sum separation benefits upon the termination of their employment based on their length of service and rate of pay.

Components of net cost related to the Korea employee defined benefit plan are as follows (in thousands):



	Three Months Ended March 31, 2018
Service cost	$	151
Cost recognized as a component of compensation cost	151
Interest cost	29
Cost recognized in other components of defined benefit plans, net	29
Net cost	$	180

Employer contributions of $2,000 were paid during the three months ended March 31, 2018. Additional employer contributions of approximately $6,000 are expected to be paid during the remainder of fiscal 2018.