15.

Defined Contribution Plans, Pension and Other Post-Retirement Benefit Plans

Defined Contribution Plans — We sponsor various 401(k) employee savings plans covering all eligible employees, as defined. Eligible employees can contribute on a pre-tax basis to the plan. In accordance with the terms of the 401(k) plans, we elect to match a certain percentage of the participants’ contributions to the plans, as defined. We recognized expense associated with these plans of approximately $2.2 million, $2.2 million and $1.0 million in 2013, 2012 and 2011, respectively.

Pension and Other Post-Retirement Benefit Plans — We sponsor pension and other post-retirement benefit plans that cover certain hourly and salaried employees in the U.S. and United Kingdom. Our policy is to make annual contributions to the plans to fund the minimum contributions as required by local regulations.

The change in benefit obligation, plan assets and funded status as of December 31 consisted of the following (in thousands):


	U.S. Pension Plans						Non-U.S. Pension Plans						Other Post-retirement Benefit Plans
	2013			2012			2013			2012			2013			2012
Change in benefit obligation:
Benefit obligation — Beginning of year	$	47,096		$	44,003		$	41,768		$	37,060		$	918		$	1,302
Service cost		108			112			—			—			—			—
Interest cost		1,704			1,802			1,761			1,863			29			48
Participant contributions		—			—			—			—			19			38
Benefits paid		(1,875	)		(1,716	)		(1,601	)		(1,453	)		(107	)		(112	)
Actuarial loss (gain)		(5,004	)		2,895			493			2,605			(173	)		(358	)
Exchange rate changes		—			—			850			1,693			—			—

Benefit obligation at end of year		42,029			47,096			43,271			41,768			686			918
Change in plan assets:
Fair value of plan assets — Beginning of year		29,395			25,823			31,939			28,241			—			—
Actual return on plan assets		3,935			3,565			3,128			2,935			—			—
Employer contributions		2,087			1,723			928			926			88			75
Participant contributions		—			—			—			—			19			38
Benefits paid		(1,875	)		(1,716	)		(1,601	)		(1,453	)		(107	)		(112	)
Exchange rate changes		—			—			650			1,290			—			(1	)

Fair value of plan assets at end of year		33,542			29,395			35,044			31,939			—			—

Funded status	$	(8,487	)	$	(17,701	)	$	(8,227	)	$	(9,829	)	$	(686	)	$	(918	)

Amounts recognized in the consolidated balance sheets at December 31 consist of (in thousands):


	U.S. Pension Plans				Non-U.S. Pension Plans				Other Post-Retirement Benefit Plans
	2013		2012		2013		2012		2013		2012
Current liabilities	$	—	$	—	$	—	$	—	$	151	$	175
Noncurrent liabilities		8,487		17,701		8,227		9,829		535		743

Net amount recognized	$	8,487	$	17,701	$	8,227	$	9,829	$	686	$	918

The components of net periodic benefit cost for the years ended December 31 are as follows (in thousands):


	U.S. Pension Plans									Non-U.S. Pension Plans									Other Post-retirement Benefit Plans
	2013			2012			2011			2013			2012			2011			2013			2012			2011
Service cost	$	108		$	112		$	73		$	—		$	—		$	—		$	—		$	—		$	—
Interest cost		1,704			1,802			1,956			1,761			1,863			2,127			29			48			65
Expected return on plan assets		(2,202	)		(1,955	)		(1,915	)		(1,878	)		(1,697	)		(1,797	)		—			—			—
Amortization of prior service credit		—			—			—			—			—			—			(122	)		(128	)		(128	)
Recognized actuarial loss (gain)		421			371			104			302			260			287			(157	)		(89	)		(136	)

Net periodic benefit cost	$	31		$	330		$	218		$	185		$	426		$	617		$	(250	)	$	(169	)	$	(199	)

Amounts Recognized in Accumulated Other Comprehensive Income (Loss) — Amounts recognized in accumulated other comprehensive income (loss) at December 31 are as follows (in thousands):


	U.S. Pension Plans						Non-U.S. Pension Plans						Other Post-retirement Benefit Plans
	2013		2012		2011		2013		2012		2011		2013			2012			2011
Net actuarial loss (gain)	$	8,014	$	15,172	$	14,256	$	10,130	$	10,965	$	9,428	$	(682	)	$	(663	)	$	(381	)
Prior service credit		—		—		—		—		—		—		81			(41	)		(170	)

	$	8,014	$	15,172	$	14,256	$	10,130	$	10,965	$	9,428	$	(601	)	$	(704	)	$	(551	)

Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss) — Amounts recognized as other changes in plan assets and benefit obligations in other comprehensive income at December 31 are as follows (in thousands):


	U.S. Pension Plans						Non-U.S. Pension Plans						Other Post-retirement Benefit Plans
	2013			2012			2013			2012			2013			2012
Actuarial loss (gain)	$	(6,737	)	$	1,286		$	(757	)	$	1,367		$	(173	)	$	(358	)
Amortization of actuarial (gain) loss		(421	)		(371	)		(302	)		(260	)		158			90
Prior service credit		—			—			—			—			122			128

Total recognized in other comprehensive income (loss)	$	(7,158	)	$	915		$	(1,059	)	$	1,107		$	107		$	(140	)

The estimated actuarial loss for the defined benefit pension plans that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is $0.2 million. The estimated actuarial gain for the other post-retirement benefit plans that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is $0.2 million.

Weighted-average assumptions used to determine benefit obligations at December 31 are as follows:


	U.S. Pension Plans						Non-U.S. Pension Plans						Other Post-retirement Benefit Plans
	2013			2012			2013			2012			2013			2012
Discount rate		4.57	%		3.67	%		4.40	%		4.20	%		4.57	%		3.67	%

Weighted-average assumptions used to determine net periodic benefit cost at December 31 are as follows:


	U.S. Pension Plans									Non-U.S. Pension Plans									Other Post-retirement Benefit Plans
	2013			2012			2011			2013			2012			2011			2013			2012			2011
Discount rate		3.67	%		4.19	%		5.31	%		4.20	%		4.90	%		5.70	%		3.67	%		4.19	%		5.31	%
Expected return on plan assets		7.50	%		7.50	%		7.50	%		5.80	%		5.80	%		6.50	%		N/A			N/A			N/A

The rate of return assumptions are based on projected long-term market returns for the various asset classes in which the plans are invested, weighted by the target asset allocations. An incremental amount for active plan asset management and diversification, where appropriate, is included in the rate of return assumption. Our pension plan investment strategy is reviewed annually.

We employ a total return investment approach whereby a mix of equities and fixed income investments are used to maximize the long-term return of Plan assets for a prudent level of risk. The intent of this strategy is to minimize plan expenses by outperforming plan liabilities over the long run. Risk tolerance is established through careful consideration of plan liabilities, plan funded status and corporate financial condition. The investment portfolio contains a diversified blend of equity, balanced, fixed income and real estate investments. Furthermore, equity investments are diversified across U.S. and non-U.S. stocks, as well as growth, value and small and large capitalizations. Other assets such as real estate are used judiciously to enhance long-term returns while improving portfolio diversification. Derivatives may be used to gain market exposure in an efficient and timely manner; however, derivatives may not be used to leverage the portfolio beyond the market value of the underlying investments. Investment risk is measured and monitored on an ongoing basis through annual liability measurements, periodic asset/liability studies and quarterly investment portfolio reviews. We expect to contribute $2.7 million to our pension plans and our other post-retirement benefit plans in 2014.

Our current investment allocation target for our pension plans for 2014 and our weighted-average asset allocations of our pension assets for the years ended December 31, by asset category, are as follows:


	Target Allocation						Pension Plans
	U.S.			Non-U.S.			2013			2012
Cash and cash equivalents		—	%		—	%		—	%		—	%
Equity securities		55			51			58			51
Debt securities		25			39			28			35
Real estate		20			10			14			14

		100	%		100	%		100	%		100	%

The following descriptions relate to our plan assets:

Cash and cash equivalents—The fair value of cash and cash equivalents is valued at cost.

Equity Securities—The overall equity category includes common stocks issued by U.S., United Kingdom and other international companies, equity funds that invest in common stocks and unit linked insurance policies. All investments generally allow near-term (within 90 days of the measurement date) liquidity and are held in issues that are actively traded to facilitate transactions at minimum cost.

Balanced —The overall balanced category includes funds primarily invested in a mix of equity and fixed income securities where the allocations are at the discretion of the investment manager. All investments generally allow near-term (within 90 days of the measurement date) liquidity and are held in issues that are actively traded to facilitate transactions at minimum cost.

Fixed Income Security—The overall fixed income category includes U.S. dollar-denominated and United Kingdom and other international marketable bonds and convertible debt securities as well as fixed income funds that invest in these instruments. All assets generally allow near-term liquidity and are held in issues, which are actively traded to facilitate transactions as minimum cost.

The fair value of fixed income securities is determined by either direct or indirect quoted market prices. When the value of assets held in separate accounts is not published, the value is based on the underlying holdings, which are primarily direct quoted market prices on regulated financial exchanges.

Real Estate—Real estate provides an indirect investment into a diversified and multi-sector portfolio of property assets. The fair value of real estate investments is valued by the fund managers. The fund managers value the real estate investments via independent third-party appraisals on a periodic basis. Assumptions used to revalue the properties are updated every quarter.

The fair values of our pension plan assets by asset category and by level as described in Note 2 for the years ended December 31, 2013 and 2012 are as follows (in thousands):


	December 31, 2013
			Quoted Prices in Active Markets for Identical Assets		Significant Observable Inputs		Significant Unobservable Inputs
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	243	$	243
Equities:
U.S. large value		3,801		3,801
U.S. large growth		3,731		3,731
International large value		986				986
International blend		5,629				5,629
International growth		2,866		2,866
Emerging markets		2,516		2,516
Balanced		20,666				20,666
Corporate bonds		18,984				18,984
Real Estate:
U.S. property		6,767						6,767
U.K. property		2,843						2,843

Total pension fund assets	$	69,032	$	13,157	$	46,265	$	9,610


	December 31, 2012
			Quoted Prices in Active Markets for Identical Assets		Significant Observable Inputs		Significant Unobservable Inputs
	Total		Level 1		Level 2		Level 3
Cash and cash equivalents	$	26	$	26	$	—	$	—
Equities:
U.S. large value		3,210		3,210		—		—
U.S. large growth		3,020		3,020		—		—
U.S. small cap growth		—		—		—		—
U.K. index		6,507		—		6,507		—
International large value		9,151		—		9,151		—
International blend		4,669		—		4,669		—
International growth		2,498		2,498		—		—
Emerging markets		2,353		2,353		—		—
Balanced		2,801		—		2,801		—
Fixed income securities:
Government bonds		4,063		—		4,063		—
Corporate bonds		14,693		—		14,693		—
Real Estate:
U.S. property		5,968		—		—		5,968
U.K. property		2,375		—		—		2,375

Total pension fund assets	$	61,334	$	11,107	$	41,884	$	8,343

The fair value of our pension plan assets measured using significant unobservable inputs (Level 3) at December 31 are as follows (in thousands):


	2013		2012
Beginning balance	$	8,343	$	6,210
Actual return on plan assets:
Relating to assets held at reporting date		980		683
Relating to assets sold during the period		17		0
Purchases, sales and settlements, net		217		1,350
Foreign currency translation adjustment		53		100

Ending balance	$	9,610	$	8,343

For measurement purposes, a 7.0% annual rate of increase in the per capita cost of covered health care benefits was assumed for 2013. The rate was assumed to decrease gradually to 5% through 2017 and remain constant thereafter. Assumed health care cost trend rates can have a significant effect on the amounts reported for other post-retirement benefit plans.

Differences in the ultimate health care cost trend rates within the range indicated below would have had the following impact on 2013 other post-retirement benefit results (in thousands):


	1 Percentage Point Increase		1 Percentage Point Decrease
Increase (Decrease) from change in health care cost trend rates
Other post-retirement benefit expense	$	5	$	(5	)
Other post-retirement benefit liability	$	17	$	(16	)

The following table summarizes our expected future benefit payments of our pension and other post-retirement benefit plans (in thousands):


Year	Pension Plans		Other Post- retirement Benefit Plans
2014	$	3,678	$	151
2015	$	3,783	$	103
2016	$	4,064	$	92
2017	$	4,312	$	91
2018	$	4,328	$	79
2019 to 2023	$	26,439	$	170