BENEFITS

Defined contribution plan:

U.S. employees are automatically enrolled in the Maxim Integrated 401(k) plan when they meet eligibility requirements, unless they decline participation. Under the terms of the plan Maxim Integrated matches 100% of the employee contributions for the first 3% of employee eligible compensation and an additional 50% match for the next 2% of employee eligible compensation, up to the IRS Annual Compensation Limits. Total defined contribution expense was $15.4 million, $14.1 million and $13.8 million in fiscal years 2014, 2013 and 2012, respectively.

Non-U.S. Pension Benefits

We provide defined-benefit pension plans in certain countries. Consistent with the requirements of local law, we deposit funds for certain plans with insurance companies, with third-party trustees, or into government-managed accounts, and/or accrue for the unfunded portion of the obligation.

Maxim Integrated is enrolled in a retirement plan for employees in the Philippines. This plan is a non-contributory and defined benefit type that provides retirement to employees equal to one month salary for every year of credited service. The benefits are paid in a lump sum amount upon retirement or separation from the Company. Total defined benefit liability was $9.6 million and $5.5 million in fiscal years 2014 and 2013, respectively. Total other comprehensive income benefit related to this retirement plan was $3.3 million for the year ended June 28, 2014.

Post-Employment Benefits

During the fourth quarter of fiscal year 2012, the Company formalized a post-retirement benefits plan merging the former and current Maxim Integrated employees with the Dallas Semiconductor participants under one pool. The plan gained the proper approvals and, accordingly, the Company has accounted for both plans as of June 28, 2014 and June 29, 2013 under ASC 715.

Medical Expense & Funded Status Reconciliation



	June 29, 2013			Fiscal Year 2014 Expense		June 28, 2014			Estimated Fiscal Year 2015 Expense
	(in thousands, except percentages)
Accumulated Postretirement Benefit Obligation [APBO]:
Retirees and beneficiaries	$	(18,162	)			$	(21,602	)
Active participants	(2,128		)			(2,626		)

Funded status	$	(20,290	)			$	(24,228	)

Actuarial gain (loss)	$	(2,369	)			$	(3,819	)
Prior service cost	—					—

Amounts Recognized in Accumulated Other Comprehensive Income:
Net actuarial loss	$	5,500				$	8,863
Prior service cost	2,744					2,387
Total	$	8,244				$	11,250

Net Periodic Postretirement Benefit Cost/(Income):
Interest cost				858					1,002
Amortization:
Prior service cost				356					356
Net actuarial loss (1)				457					961
Total net periodic postretirement benefit cost				$	1,671				$	2,319

Employer contributions				$	738				$	749

Economic Assumptions:
Discount rate	4.3%					4.2%
Medical trend	8.5% -5%					8.0% -5%

(1) Unrecognized losses are amortized over average remaining service period of active participants of 6.7 years at June 28, 2014.

The following benefit payments are expected to be paid:



	Non-Pension Benefits
	(in thousands)
2015	$	749
2016	809
2017	858
2018	907
2019	961
Thereafter	19,944
	$	24,228

Dallas Semiconductor Split-Dollar Life Insurance

As a result of the Company's acquisition of Dallas Semiconductor in 2001, the Company assumed responsibility associated with a split-dollar life insurance policy held by a former Dallas Semiconductor officer. The policy is owned by the individual with the Company retaining a limited collateral assignment.

The Company had $4.2 million and $3.2 million included in Other Assets as of June 28, 2014 and June 29, 2013, respectively, associated with the limited collateral assignment to the policy. The Company had a $5.7 million and $4.8 million obligation included in Other Liabilities as of June 28, 2014 and June 29, 2013, respectively, related to the anticipated continued funding associated with the policy.