EMPLOYEE RETIREMENT PLAN

In connection with the acquisition of Reinhold (see Note 2, Acquisitions), the Company assumed Reinhold's frozen qualified defined benefit pension plan (the "Plan"). The Plan's benefits are based on employee compensation and years of service. However, since the Plan was closed to new participants effective December 31, 2004, the accrued benefit for Plan participants was fixed as of the date of acquisition. The acquired projected benefit obligation and plan assets were recorded at fair value as of the acquisition date.

Changes in the Plan's projected benefit obligation and plan assets since the acquisition are as follows (in thousands):



Change in projected benefit obligation:
Acquired projected benefit obligation		$14,539
Interest cost	95
Benefits paid	(160		)
Projected benefit obligation as of July 31, 2013		$14,474

Change in plan assets:
Acquired plan assets		$11,674
Expected return on plan assets	128
Benefits paid	(160		)
Plan assets as of July 31, 2013		$11,642

The $2.8 million difference between the projected benefit obligation and plan assets as of July 31, 2013 was included in other long-term liabilities within the Company's Condensed Consolidated Balance Sheet.

Components of net benefit income since the acquisition within the Company's Condensed Statement of Operations are as follows (in thousands):



Expected return on plan assets		$128
Interest cost	95
Net benefit income		$33

The Company has not made any contributions to the Plan since the acquisition and does not expect to be required to make contributions to the Plan during the remainder of fiscal 2013. Estimated future benefit payments for the remainder of fiscal 2013 are $.2 million. Estimated future benefit payments to be made from fiscal 2014 to fiscal 2023 are as follows (in thousands):



Year ending October 31,
2014		$965
2015	936
2016	920
2017	904
2018	892
2019-2023	4,280

As of July 31, 2013, 80% of the Plan's assets were invested in fixed-income securities and 20% were invested in equity securities, which match the Plan's current investment target allocations. The Company is currently evaluating the Plan's asset allocation policy which was established prior to the acquisition. The Company's objective is to maximize long-term investment return while maintaining an acceptable level of risk that is accomplished through broad diversification of the Plan's assets.