Defined Benefit Plans

Supplemental Executive Retirement Plan

On August 23, 2005, the Board of Directors of the Company adopted a Supplemental Executive Retirement Plan (“SERP”) which became effective January 1, 2006. The SERP provides select employees who satisfy certain eligibility requirements with certain benefits upon retirement, termination of employment, death, disability or a change in control of the Company, in certain prescribed circumstances.

As a non-qualified pension plan, no dedicated funding of the SERP is required; however, the Company has made periodic payments into insurance policies held in a rabbi trust to fund the expected obligations arising under the non-qualified SERP. The amount of any future payments into the insurance policies, if any, may vary depending on investment performance of the trust. The cash surrender values of the insurance policies were $62.8 million and $58.6 million as of October 28, 2017 and January 28, 2017, respectively, and were included in other assets in the Company’s condensed consolidated balance sheets. As a result of changes in the value of the insurance policy investments, the Company recorded unrealized gains of $1.6 million and $5.5 million in other income during the three and nine months ended October 28, 2017, respectively, and unrealized gains (losses) of $(0.5) million and $4.6 million in other income and expense during the three and nine months ended October 29, 2016, respectively. The projected benefit obligation was $53.6 million and $53.5 million as of October 28, 2017 and January 28, 2017, respectively, and was included in accrued expenses and other long-term liabilities in the Company’s condensed consolidated balance sheets depending on the expected timing of payments. SERP benefit payments of $0.4 million and $1.3 million were made during the three and nine months ended October 28, 2017, respectively. SERP benefit payments of $0.4 million and $1.3 million were made during the three and nine months ended October 29, 2016, respectively.

Swiss Pension Plan

In accordance with local regulations, the Company also maintains a pension plan in Switzerland for certain of its employees. The plan is a government-mandated defined contribution plan that provides employees with a minimum investment return determined annually by the Swiss government, and as such, is treated under pension accounting in accordance with authoritative guidance. Under the plan, both the Company and certain of its employees with annual earnings in excess of government determined amounts are required to make contributions into a fund managed by an independent investment fiduciary. The Company’s contributions must be made in an amount at least equal to the employee’s contribution. Minimum employee contributions are based on the respective employee’s age, salary and gender.

As of October 28, 2017 and January 28, 2017, the plan had a projected benefit obligation of $18.9 million and $17.6 million, respectively, and plan assets held at the independent investment fiduciary of $15.4 million and $14.1 million, respectively. The net liability of $3.5 million was included in other long-term liabilities in the Company’s condensed consolidated balance sheets as of October 28, 2017 and January 28, 2017.

The components of net periodic defined benefit pension cost for the three and nine months ended October 28, 2017 and October 29, 2016 related to the Company’s defined benefit plans are as follows (in thousands):



	Three Months Ended October 28, 2017
	SERP		Swiss Pension Plan			Total
Service cost	$	—	$	492		$	492
Interest cost	461		22			483
Expected return on plan assets	—		(48		)	(48		)
Net amortization of unrecognized prior service credit	—		(7		)	(7		)
Net amortization of actuarial losses	38		78			116
Net periodic defined benefit pension cost	$	499	$	537		$	1,036



	Nine Months Ended October 28, 2017
	SERP		Swiss Pension Plan			Total
Service cost	$	—	$	1,452		$	1,452
Interest cost	1,382		64			1,446
Expected return on plan assets	—		(143		)	(143		)
Net amortization of unrecognized prior service credit	—		(20		)	(20		)
Net amortization of actuarial losses	114		230			344
Net periodic defined benefit pension cost	$	1,496	$	1,583		$	3,079



	Three Months Ended October 29, 2016
	SERP		Swiss Pension Plan			Total
Service cost	$	—	$	381		$	381
Interest cost	460		22			482
Expected return on plan assets	—		(46		)	(46		)
Net amortization of unrecognized prior service credit	—		(7		)	(7		)
Net amortization of actuarial losses	39		47			86
Net periodic defined benefit pension cost	$	499	$	397		$	896



	Nine Months Ended October 29, 2016
	SERP		Swiss Pension Plan			Total
Service cost	$	—	$	1,152		$	1,152
Interest cost	1,380		66			1,446
Expected return on plan assets	—		(139		)	(139		)
Net amortization of unrecognized prior service credit	—		(21		)	(21		)
Net amortization of actuarial losses	116		141			257
Net periodic defined benefit pension cost	$	1,496	$	1,199		$	2,695