Defined Benefit Plans

Maxwell SA Pension Plan

Maxwell SA has a retirement plan that is classified as a defined benefit pension plan. The employee pension benefit is based on compensation, length of service and credited investment earnings. The plan guarantees both a minimum rate of return as well as minimum annuity purchase rates. The Company’s funding policy with respect to the pension plan is to contribute the amount required by Swiss law, using the required percentage applied to the employee’s compensation. In addition, participating employees are required to contribute to the pension plan. This plan has a measurement date of December 31.

Components of net pension cost are as follows (in thousands):



	Three Months Ended September 30,						Nine Months Ended September 30,
	2018			2017			2018			2017
Service cost	$	309		$	251		$	939		$	737
Cost recognized as a component of compensation cost	309			251			939			737
Interest cost	58			59			175			172
Expected return on plan assets	(322		)	(258		)	(978		)	(757		)
Prior service cost amortization	24			38			72			113
Net cost recognized in other components of defined benefit plans, net	(240		)	(161		)	(731		)	(472		)
Net pension cost	$	69		$	90		$	208		$	265

Employer contributions of $134,000 and $155,000 were paid during the three months ended September 30, 2018 and 2017, respectively. Employer contributions of $0.4 million and $0.5 million were paid during the nine months ended September 30, 2018 and 2017, respectively. Additional employer contributions of approximately $113,000 are expected to be paid during the remainder of fiscal 2018.

Korea Defined Benefit Plan

In connection with the Nesscap Acquisition, the Company assumed the defined benefit plan liability related to Nesscap Korea’s employees. Pursuant to the Labor Standards Act of Korea, employees and most executive officers with one or more years of service are entitled to lump sum separation benefits upon the termination of their employment based on their length of service and rate of pay.

Components of net cost related to the Korea employee defined benefit plan are as follows (in thousands):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Service cost	$	145	$	134	$	446	$	221
Cost recognized as a component of compensation cost	145		134		446		221
Interest cost	23		20		82		34
Cost recognized in other components of defined benefit plans, net	23		20		82		34
Net cost	$	168	$	154	$	528	$	255

Employer contributions of $1,000 and $2,000 were paid during the three months ended September 30, 2018 and 2017, respectively. Employer contributions of $6,000 and $4,000 were paid during the nine months ended September 30, 2018 and 2017, respectively. Additional employer contributions of approximately $1,000 are expected to be paid during the remainder of fiscal 2018.