NOTE

–

EMPLOYEE BENEFIT PLANS

Defined Contribution and Deferred Compensation Plans

The Company has a

401

(k) retirement investment plan (

“401

(k) Plan”), which is open to all otherwise eligible U.S. employees

with at least

six

months of service. The

401

(k) Plan calls for Company matching contributions on a sliding scale based on the level of the employee’s contribution. The Company

may,

at its discretion, make additional contributions to the

401

(k) Plan based on the attainment of certain performance targets by its subsidiaries. The Company’s matching contributions are funded bi-monthly and totaled approximately

$3.0

million,

$3.1

million, and

$2.9

million for the years

2017,

2016,

and

2015,

respectively.

discretionary contributions were made in

2017,

2016,

2015.

Under the Company

’s nonqualified savings plans (“NSPs”), the Company provides eligible employees the opportunity to enter into agreements for the deferral of a specified percentage of their compensation, as defined in the NSPs. The NSPs call for Company matching contributions on a sliding scale based on the level of the employee’s contribution. The obligations of the Company under such agreements to pay the deferred compensation in the future in accordance with the terms of the NSPs are unsecured general obligations of the Company. Participants have

right, interest or claim in the assets of the Company, except as unsecured general creditors. The Company has established a rabbi trust to hold, invest and reinvest deferrals and contributions under the NSPs. If a change in control of the Company occurs, as defined in the NSPs, the Company will contribute an amount to the rabbi trust sufficient to pay the obligation owed to each participant. Deferred compensation in connection with the NSPs totaled

$31.9

million at

December 31, 2017.

The Company invests the deferrals in insurance instruments with readily determinable cash surrender values. The value of the insurance instruments was

$28.0

million as of

December 31, 2017.

Foreign Defined Benefit Plans

The Company has trusteed defined benefit retirement plans which cover many of its European employees. The benefits are generally based on years of service and the employee

’s average monthly compensation. Pension expense was

$1.9

million,

$1.2

million, and

$2.1

million for the years

2017,

2016

and

2015,

respectively. Plan assets are primarily invested in insurance contracts and equity and fixed income securities. The Company uses a year-end measurement date for the plans. As of

December 31, 2017,

for the European plans, the Company had a net liability recorded of

$13.4

million, an amount equal to their underfunded status, and has recorded in Other Comprehensive Income an amount equal to

$48.0

million (net of taxes of approximately

$15

million) related to the future amounts to be recorded in net post-retirement benefit costs.

The tables presented below set forth the funded status of the Company

’s significant foreign defined benefit plans and required disclosures in accordance with applicable accounting standards

	FISCAL YEAR
	20 17			20 16
	(in thousands)
Change in benefit obligation
Benefit obligation, beginning of year	$	277,813		$	243,717
Service cost		1,628			1,032
Interest cost		5,559			6,580
Benefits and expenses paid		(10,267	)		(8,551	)
Actuarial loss (gain)		13,351			73,600
Member contributions		262			225
Currency translation adjustment		32,202			(38,790	)

Benefit obligation, end of year	$	320,548		$	277,813

	FISCAL YEAR
	2017			2016
	(in thousands)
Change in plan assets
Plan assets, beginning of year	$	258,365		$	239,281
Actual return on assets		25,691			59,364
Company contributions		2,812			4,991
Benefits paid		(10,267	)		(8,552	)
Currency translation adjustment		30,565			(36,719	)

Plan assets, end of year	$	307,166		$	258,365

Reconciliation to balance sheet
Funded status benefit asset/(liability)	$	(13,382	)	$	(19,448	)

Net amount recognized	$	(13,382	)	$	(19,448	)

Amounts recognized in accumulated other comprehensive income (after tax)
Unrecognized actuarial loss	$	48,443		$	49,547
Unamortized prior service costs		(471	)		(311	)
Total amount recognized	$	47,972		$	49,236


Accumulated Benefit Obligation	$	313,257		$	274,414

The above disclosure represents the aggregation of information related to the Company

’s

two

defined benefit plans which cover many of its European employees. As of

December 31, 2017,

and

January 1, 2017,

one

of these plans, which primarily covers certain employees in the United Kingdom (the “UK Plan”), had an accumulated benefit obligation in excess of the plan assets. The other plan, which covers certain employees in the Netherlands (the “Dutch Plan”), had assets in excess of the accumulated benefit obligation. The following table summarizes this information as of

December 31, 2017

and

January 1, 2017.

	END OF FISCAL YEAR
	20 17		20 16
	(in thousands)
UK Plan
Projected Benefit Obligation	$	190,992	$	171,172
Accumulated Benefit Obligation		190,992		171,172
Plan Assets		179,322		153,132


Dutch Plan
Projected Benefit Obligation	$	129,554	$	106,641
Accumulated Benefit Obligation		122,265		103,242
Plan Assets		127,844		105,233

	FISCAL YEAR
	2017			2016			2015
	(in thousands)
Components of net periodic benefit cost
Service cost	$	1,628		$	1,032		$	1,061
Interest cost		5,559			6,580			8,384
Expected return on plan assets		(6,496	)		(7,553	)		(8,764	)
Amortization of prior service cost		(34	)		33			33
Recognized net actuarial (gains)/losses		1,287			1076			1,359

Net periodic benefit cost	$	1,944		$	1,168		$	2,073

The

Company reconciles the components of net periodic pension expense by comparing the beginning balance of assets and the beginning projected obligation against the assumptions of asset return and interest costs. Any significant differences will be explained. There were

such differences in

2017.

For

18,

it is estimated that approximately

$1.2

million of expenses related to the amortization of unrecognized items will be included in the net periodic benefit cost. During

2017,

other comprehensive income was impacted by approximately

$7.0

million comprised of actuarial gain of approximately

$5.8

million and amortization of

$1.2

million.

This decrease was offset by the strengthening of the euro and British Pound against the dollar during

2017.

	FISCAL YEAR
	201 7			201 6			201 5
Weighted average assumptions used to determine net periodic benefit cost
Discount rate		2.0	%		2.7	%		3.0	%
Expected return on plan assets		2.3	%		3.1	%		4.0	%
Rate of compensation		1.75	%		2.0	%		2.0	%
Weighted average assumptions used to determine benefit obligations
Discount rate		2.2	%		2.3	%		3.4	%
Rate of compensation		1.75	%		2.0	%		2.0	%

The expected long-term rate of return on plan assets assumption is based on weighted average expected returns for each asset class. Expected returns reflect a combination of historical performance analysis and the forward-looking views of the financial markets, and include input from actuaries, investment service firms and investment managers.

The investment objectives of the foreign defined benefit plans are to maximize the return on the investments without exceeding the limits of the prudent pension fund investment, to ensure that the assets would be sufficient to exceed minimum funding requirements, and to achieve a favorable return against the performance expectation based on historic and projected rates of return over the short term. The goal is to optimize the long-term return on plan assets at a moderate level of risk, by balancing higher-returning assets, such as equity securities, with less volatile assets, such as fixed income securities. The assets are managed by professional investment firms and performance is evaluated periodically against specific benchmarks. The plans

’ net assets did

not

include the Company’s own stock at

December 31, 2017

January 1, 2017.

Dutch Plan Assets and Indexation

Benefit

As is common in Dutch pension plans, the Dutch

Plan includes a provision for discretionary benefit increases termed “indexation.” The indexation benefit is meant to adjust pension benefits for cost-of-living increases, similar to U.S. consumer price index-based cost-of-living adjustments for U.S. retirement plans. The indexation benefit is

not

guaranteed, and is only provided for and paid out if sufficient assets are available due to favorable asset returns.

Both the vested benefit amounts as well as amounts related to the discretionary indexation benefits under the

Dutch Plan are paid pursuant to an insurance contract with a private insurer (the “Contract”). The Plan itself is financed by investment assets held within the Contract. The Contract guarantees payment of vested amounts, regardless of whether Plan assets held through the Contract are ultimately sufficient to pay vested amounts, and also provides for payment of the indexation amount on a contingent basis if the actual return on Dutch Plan assets is sufficient to pay it. This type of insurance arrangement is common in The Netherlands, although

not

necessarily common in other jurisdictions.

Because the prior actual and future projected returns on

Dutch Plan assets have been determined to be sufficient to provide for the indexation benefit, the Company and the insurer agreed that it was appropriate to provide the indexation benefit under the Contract. The indexation benefit thus becomes an amount payable by the insurer under the Contract, and consequently is recorded as a Plan asset. The corresponding obligation to pay the indexation amount to pensioners thus became a pension liability. As of

December 31, 2017,

and

January 1, 2017,

this indexation liability and corresponding asset was

$32.7

million and

$32.2

million, respectively. The inclusion of this amount does

not

have any impact on the funded status of the plan, as both the indexation asset and liability are recorded at the same amount. This indexation asset, along with the remainder of the assets under the Dutch Plan, are identified as Level Three assets under the fair value hierarchy.

Under the express terms of the Contract, contract value is the greater of (i) the value of the discounted vested benefits of the

Dutch Plan (i.e., the benefit amount guaranteed by the insurance company), and (ii) the fair value of the underlying investment assets held by the insurance company under the Contract. As between those

two

values, the former was the greater for

2017

and

2016

and this represents the plan assets as shown above for the Dutch Plan. However, as explained above, the Contract also will pay the indexation benefit if sufficient assets are available, which the Company believes to be probable based on recent returns. Therefore, in addition to the value of the discounted vested benefits of the Dutch Plan, in determining the fair value of the Contract, the Company believed that it was appropriate to include the value of the indexation payments that are being added to the vested benefit amounts. As explained above, these indexation benefits will be paid out of the Contract if asset returns continue to exceed expectations. If the asset returns are

not

of an expected amount to allow for indexation, the Company can, at any time, remove this indexation benefit.

The Company

’s actual weighted average asset allocations for

2017

and

2016,

and the targeted asset allocation for

2018,

of the foreign defined benefit plans by asset category, are as follows:

	FISCAL YEAR
	2018			2017			2016
	Target Allocation			Percentage of Plan Assets at Year End
Asset Category:
Equity Securities	15%	-	20%		16	%		15	%
Debt and Debt Securities	35%	-	45%		32	%		36	%
Other	40%	-	50%		52	%		49	%

		100%			100	%		100	%

Fair Value Measurements of Plan Assets

Accounting standards establish a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure estimated fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level

measurements) and the lowest priority to unobservable inputs (level

measurements). The

three

levels of the fair value hierarchy under applicable accounting standards are described below:

Level 1	Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2	Inputs to the valuation methodology include :
		● quoted prices for similar assets in active markets;
		● quoted prices for identical or similar assets in inactive markets;
		● inputs other than quoted prices that are observable for the asset; and
		● inputs that are derived principally or corroborated by observable data by correlation or other means.

Level 3	Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

A financial instrument

’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The following table sets forth by level within the fair value hierarchy the

foreign defined benefit plans’ assets at fair value, as of

December 31, 2017

and

January 1, 2017.

As required by accounting standards, assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As noted above the Dutch pension plan assets as represented by the insurance contact are classified as a Level

asset and included in the “Other” asset category.

	Pension Plan Assets by Category as of December 31, 2017
	Dutch Plan		UK Plan		Total
			(in thousands)
Level 1	$	0	$	87,521	$	87,521
Level 2		0		68,668		68,668
Level 3		127,844		23,133		150,977
Total	$	127,844	$	179,322	$	307,166

	Pension Plan Assets by Category as of January 1, 2017
	Dutch Plan		UK Plan		Total
			(in thousands)
Level 1	$	0	$	80,048	$	80,048
Level 2		0		50,364		50,364
Level 3		105,233		22,720		127,953
Total	$	105,233	$	153,132	$	258,365

The tables below detail the foreign defined benefit plans

’ assets by asset allocation and fair value hierarchy:

	2017
	Level 1		Level 2		Level 3
			(in thousands)
Asset Class
Equity Securities	$	48,285	$	0	$	0
Debt and Debt Securities		36,780		41,381		19,883
Other (including cash)		2,456		27,287		131,094
	$	87,521	$	68,668	$	150,977

	201 6
	Level 1		Level 2		Level 3
			(in thousands)
Asset Class
Equity Securities	$	37,696	$	0	$	0
Debt and Debt Securities		37,175		36,378		19,224
Other (including cash)		5,177		13,986		108,729
	$	80,048	$	50,364	$	127,953

With the exception of the

Dutch Plan assets as discussed above, the assets identified as level

above in

2017

and

2016

relate to insured annuities and direct lending assets held by the UK Plan. The fair value of these assets was calculated using the present value of the future cash flows due under the insurance annuities and for the direct lending assets the value is based on the asset value from the latest available valuation with adjustments for any drawdowns and distribution payments made between the valuation date and the reporting date. The table below indicates the change in value related to these level

assets during

2017:

	201 7
	(in thousands)
Balance of level 3 assets, beginning of year	$	127,953
Interest cost		2,633
Benefits paid		(3,728	)
Assets transferred in to (out of) Level 3		(2,089	)
Actuarial gain (loss)		8,753
Translation adjustment		17,455
Ending Balance of level 3 assets	$	150,977

During

18,

the Company expects to contribute

$3.3

million to the plans. It is anticipated that future benefit payments for the foreign defined benefit plans will be as follows:

FISCAL YEAR			EXPECTED PAYMENTS
			(in thousands)

201 8			$	9,115
201 9				9,334
20 20				9,650
20 21				10,011
20 22				10,257
2023	-	2027		54,661

Domestic Defined Benefit Plan

The Company maintains a domestic nonqualified salary continuation plan (“SCP”)

, which is designed to induce selected officers of the Company to remain in the employ of the Company by providing them with retirement, disability and death benefits in addition to those which they

may

receive under the Company’s other retirement plans and benefit programs. The SCP entitles participants to: (i) retirement benefits upon normal retirement at age

(or early retirement as early as age

) after completing at least

years of service with the Company (unless otherwise provided in the SCP), payable for the remainder of their lives (or, if elected by a participant, a reduced benefit is payable for the remainder of the participant’s life and any surviving spouse’s life) and in

event less than

years under the death benefit feature; (ii) disability benefits payable for the period of any total disability; and (iii) death benefits payable to the designated beneficiary of the participant for a period of up to

years. Benefits are determined according to

one

three

formulas contained in the SCP, and the SCP is administered by the Compensation Committee of the Company’s Board of Directors, which has full discretion in choosing participants and the benefit formula applicable to each. The Company’s obligations under the SCP are currently unfunded (although the Company uses insurance instruments to hedge its exposure thereunder). The Company is required to contribute the present value of its obligations thereunder to an irrevocable grantor trust in the event of a change in control as defined in the SCP. The Company uses a year-end measurement date for the domestic SCP.

The tables presented below set forth the required disclosures in accordance with

applicable accounting standards, and amounts recognized in the consolidated financial statements related to the domestic SCP. There is

service cost component of the change in benefit obligation in

2017

as there are

longer any active participants in the plan.

	FISCAL YEAR
	2017			2016
	(in thousands)
Change in benefit obligation
Benefit obligation, beginning of year	$	29,700		$	25,860
Service cost		0			440
Interest cost		1,256			1,269
Benefits paid		(1,943	)		(1,012	)
Actuarial loss (gain)		2,906			3,143

Benefit obligation, end of year	$	31,919		$	29,700

The amounts recognized in the consolidated balance sheets are as follows:

	20 17		20 16
	(in thousands)
Current liabilities	$	2,030	$	1,890
Non-current liabilities		29,889		27,810
Total benefit obligation	$	31,919	$	29,700

The components of the amounts in accumulated other comprehensive income, after tax, are as follows:

	20 17		20 16
	(in thousands)
Unrecognized actuarial loss		8,582	$	5,626

The accumulated benefit obligation related to the SCP was

$31.9

million and

$29.7

million as of

December 31, 2017

and

January 1, 2017,

respectively. The SCP is currently unfunded; as such, the benefit obligations disclosed are also the benefit obligations in excess of the plan assets. The Company uses insurance instruments to help limit its exposure under the SCP.

	20 17			20 16			20 15
	(in thousands, except for assumptions)
A ssumptions used to determine net periodic benefit cost
Discount rate		3.85	%		4.25	%		4.0	%
Rate of compensation		-			4.0	%		4.0	%

Assumptions used to determine benefit obligations
Discount rate		3.5	%		3.85	%		4.25	%
Rate of compensation		-			4.0	%		4.0	%

Components of net periodic benefit cost
Service cost	$	0		$	440		$	594
Interest cost		1,256			1,269			1,113
Amortization s		364			811			522

Net periodic benefit cost	$	1,620		$	2,520		$	2,229

The changes in other comprehensive income during

related to the SCP as a result of plan activity and valuation were approximately

$1.7

million, after tax, primarily comprised of a net loss during the period of

$2.0

million and amortization of loss of

$0.3

million. In addition to these items, as a result of the recently enacted U.S. Tax Cuts and Jobs Act changes, the Company increased its minimum pension liability which resides in accumulated other comprehensive income by

$1.3

million to record the liability net of the new lower U.S. federal tax rate.

For

18,

the Company estimates that approximately

$0.5

million of expenses related to the amortization of unrecognized items will be included in net periodic benefit cost for the SCP.

During

17,

the Company contributed

$1.9

million in the form of direct benefit payments for its domestic SCP. It is anticipated that future benefit payments for the SCP will be as follows:

FISCAL YEAR			EXPECTED PAYMENTS
			(in thousands)
20 18			$	2,030
20 19				2,030
20 20				2,030
20 21				2,030
202 2				2,030
2023	-	2027		9,990