Employee Benefit Plans

We sponsor an employee savings plan (“401(k) plan”) covering substantially all of our United States based employees. We also sponsor a defined benefit pension plan (the “pension plan”) that was frozen in 2009. It covered substantially all our United States based employees at the time it was frozen.

Total employer contributions to the 401(k) plan were $8.3 million, $7.5 million and $7.1 million during the years ended December 31, 2018, 2017 and 2016, respectively.

We use a December 31, measurement date for our pension plan. Cumulative gains and losses in excess of 10% of the greater of the benefit obligation or the market-related value of assets are amortized on a straight-line basis over the lesser of the expected average remaining life expectancy of the plan's participants or 12 years. The limit of 12 years is adjusted to reflect the percentage change in the average remaining service period for the plan's active membership.

The following table provides a reconciliation of the projected benefit obligation, plan assets and funded status of the pension plan at December 31:



	2018			2017
Accumulated benefit obligation	$	80,776		$	87,765

Change in benefit obligation
Projected benefit obligation at beginning of year	$	87,765		$	82,005
Service cost	675			603
Interest cost	2,806			2,773
Actuarial gain (loss)	(7,430		)	6,556
Benefits paid	(2,104		)	(1,976		)
Settlements	(936		)	(2,196		)
Projected benefit obligation at end of year	$	80,776		$	87,765

Change in plan assets
Fair value of plan assets at beginning of year	$	74,932		$	69,061
Actual gain (loss) on plan assets	(5,585		)	10,043
Benefits paid	(2,104		)	(1,976		)
Settlements	(936		)	(2,196		)
Fair value of plan assets at end of year	$	66,307		$	74,932

Funded status	$	(14,469	)	$	(12,833	)

Amounts recognized in the consolidated balance sheets consist of the following at December 31,:



	2018			2017
Other long-term liabilities	$	(14,469	)	$	(12,833	)
Accumulated other comprehensive loss	(41,822		)	(40,937		)

Accumulated other comprehensive loss for the years ended December 31, 2018 and 2017 consists of net actuarial losses not yet recognized in net periodic pension cost (before income taxes).

The following actuarial assumptions were used to determine our accumulated and projected benefit obligations as of December 31,:



	2018		2017
Discount rate	4.37	%	3.69	%

Other changes in plan assets and benefit obligations recognized in other comprehensive income in 2018 and 2017 are as follows:



	2018			2017
Current year actuarial loss	$	(3,574	)	$	(1,812	)
Amortization of actuarial loss	2,689			2,835
Total recognized in other comprehensive loss	$	(885	)	$	1,023

The estimated portion of net actuarial loss in accumulated other comprehensive loss that is expected to be recognized as a component of net periodic pension cost in 2019 is $2.9 million.

Net periodic pension cost for the years ended December 31, consists of the following:



	2018			2017			2016
Service cost	$	675		$	603		$	452
Interest cost on projected benefit obligation	2,806			2,773			2,878
Expected return on plan assets	(5,418		)	(5,300		)	(5,189		)
Amortization of loss	2,689			2,835			2,780
Net periodic pension cost	$	752		$	911		$	921

The following actuarial assumptions were used to determine our net periodic pension benefit cost for the years ended December 31,:



	2018		2017		2016
Discount rate on benefit obligation	3.69	%	4.28	%	4.54	%
Effective rate for interest on benefit obligation	3.28	%	3.49	%	3.77	%
Expected return on plan assets	7.50	%	8.00	%	8.00	%

We use a full yield curve approach in the estimation of the interest cost component of net periodic pension cost by applying the specific spot rates along the yield curve used in the determination of the benefit obligation that correlates to the relevant projected cash flows ("spot rate approach").

In determining the expected return on pension plan assets, we consider the relative weighting of plan assets, the historical performance of total plan assets and individual asset classes and economic and other indicators of future performance. In addition, we consult with financial and investment management professionals in developing appropriate targeted rates of return.

Asset management objectives include maintaining an adequate level of diversification to reduce interest rate and market risk and providing adequate liquidity to meet immediate and future benefit payment requirements.

The allocation of pension plan assets by category is as follows at December 31,:



	Percentage of Pension Plan Assets				Target Allocation
	2018		2017		2019
Equity securities	71	%	87	%	70	%
Debt securities	29		13		30
Total	100	%	100	%	100	%

As of December 31, 2018, the pension plan held 27,562 shares of our common stock, which had a fair value of $1.8 million. We believe that our long-term asset allocation on average will approximate the targeted allocation. We regularly review our actual asset allocation and periodically rebalance the pension plan’s investments to our targeted allocation when deemed appropriate.

FASB guidance defines fair value and establishes a framework for measuring fair value and related disclosure requirements as described in Note 15. Following is a description of the valuation methodologies used for our pension assets. There have been no changes in the methodologies used at December 31, 2018 and 2017:



Common Stock:	Common stock is valued at the closing price reported on the common stock’s respective stock exchange and is classified within level 1 of the valuation hierarchy.

Fixed Income Securities:	Valued at the closing price reported on the active market on which the individual securities are traded and are classified within level 1 of the valuation hierarchy.

Money Market Fund:	These investments are public investment vehicles valued using the Net Asset Value (NAV).

Mutual Funds:	These investments are public investment vehicles valued using the Net Asset Value (NAV) provided by the administrator of the fund. The NAV is based on the value of the underlying assets owned by the fund, minus its liabilities, and then divided by the number of shares outstanding.

The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the pension plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.

The following table sets forth the value of the pension plan's assets as of December 31, 2018 and December 31, 2017:



	2018		2017
Investments measured at fair value:
Level 1
Common Stock	$	6,362	$	36,643
Fixed Income Securities	17,640		7,974
Total Investments measured at fair value	24,002		44,617

Investments measured at NAV:
Money Market Fund	1,385		1,517
Mutual Funds	40,920		28,798
Total Investments measured at NAV	42,305		30,315

Total Investments	$	66,307	$	74,932

We do not expect to make any contributions to our pension plan for 2019.

The following table summarizes the benefits and settlements expected to be paid by our pension plan in each of the next five years and in aggregate for the following five years. The expected payments are estimated based on the same assumptions used to measure the Company’s projected benefit obligation at December 31, 2018 and reflect the impact of expected future employee service.



2019		$5,602
2020	5,651
2021	4,901
2022	5,249
2023	5,294
2024-2028	25,688