Note 7 – Pension Plans

During the three months ended July 4, 2014, pursuant to the Manufacturing Consolidation Project, the Company terminated certain employees in its Swiss subsidiary resulting in a Swiss pension plan curtailment as defined by ASC 715-30-35, Defined Benefit Plans – Pensions, Settlements, Curtailments, and Certain Termination Benefits. The curtailment resulted in a decrease of $1.2 million in the Swiss pension plan’s projected benefit obligation, of which $0.7 million was used to distribute cash payments to employees resulting in a decrease in plan assets. The remaining $0.5 million was recorded as a curtailment gain measured in accordance with ASC 715-30-35-93.

For the three month period ended October 3, 2014, the Company recorded an additional curtailment in its Swiss pension plan, resulting in an decrease of $0.4 million in the Swiss pension plan’s projected benefit obligation, of which $0.2 million was used to distribute cash payments to employees from plan assets. The remaining $0.2 million was recorded as a curtailment gain measured in accordance with ASC 715-30-35-93.

However, since the Swiss pension plan’s accumulated other comprehensive loss, immediately preceding the curtailments exceeded the curtailment gains, the curtailment gains were fully offset against the loss and no gain was recognized in earnings.

As of July 4, 2014, the discount rate, one of the key assumptions used to calculate the Swiss pension plan’s projected benefit obligation, was reduced from 2.5% to 2%, resulting in an increase to the projected benefit obligation of $0.6 million recorded through an offsetting increase in the accumulated other comprehensive loss account of the Swiss pension plan. As of October 3, 2014, no significant changes to any key assumptions were made.

The following table summarizes the components of net periodic pension cost recorded for the Company’s defined benefit pension plans (in thousands):

	Three Months Ended October 3, 2014		Three Months Ended September 27, 2013		Nine Months Ended October 3, 2014		Nine Months Ended September 27, 2013
Service cost	$	116	$	81	$	349	$	284
Interest cost		30		—		102		52
Expected return on plan assets		(22)		(25)		(76)		(73)
Amortization of unrecognized transitional obligation		—		—		—		4
Amortization of prior service cost		—		—		—		—
Recognized actuarial gain		6		(69)		18		(50)
	$	130	$	(13)	$	393	$	217

During the nine months ended October 3, 2014 and September 27, 2013, the Company made employer contributions totaling approximately $279,000 and $175,000 to its Swiss pension plan and does not expect to make any additional contributions during the remainder of 2014, as the Company has met the annual contribution requirement. The Company is not required to and does not make contributions to its Japan pension plan.