Note 5.

RETIREMENT BENEFIT PLANS

Pension and Other Postretirement Plans

Certain subsidiaries have frozen pension plans covering substantially all of their employees. These plans are noncontributory, defined benefit pension plans. The benefits to be paid under these plans are generally based on employees’ retirement age and years of service. The Company’s funding policies, subject to the minimum funding requirements of employee benefit and tax laws and as determined on an actuarial basis, to provide the plans with assets sufficient to meet the benefit obligations. Plan assets consist primarily of fixed income investments, corporate equities and government securities. The Company also provides certain health care and life insurance benefits for some of its retired employees. The postretirement health plans are unfunded.

The Company recognizes the overfunded or underfunded positions of defined benefit postretirement plans as an asset or liability in its Consolidated Balance Sheets and recognizes as a component of other comprehensive loss the gains or losses and prior service costs or credits that arise during the period but were not recognized as components of net periodic benefit cost.

The Company expects to contribute $61,000 to pension plans in the 2016 fiscal year. The Company uses a December 31 measurement date for its pension and other postretirement benefit plans. The fair value of plan assets was determined by inputs to the valuation which include quoted prices for similar assets in active markets that are observable either directly or indirectly (Level 2 inputs). The Company utilized a third-party to evaluate the fair value of the plan assets and reviews all applicable inputs and calculations for purposes of valuing the plan’s assets. The fair value and allocation of pension plan assets is as follows as of December 31, (amounts in thousands):

			Fair Value Measurements at December 31, 2015
Asset Class	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)

Equity Securities	$	676	$	-	$	676	$	-
Fixed Income Securities		323		-		323		-
Money Market		112		-		112		-
Other		6		-		6		-
	$	1,117	$	-	$	1,117	$	-

			Fair Value Measurements at December 31, 2014
Asset Class	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)

Equity Securities	$	754	$	-	$	754	$	-
Fixed Income Securities		266		-		266		-
Money Market		116		-		116		-
Other		6		-		6		-
	$	1,142	$	-	$	1,142	$	-

The following table presents the funded status of the Company’s pension and postretirement benefit plans for the years ended December 31, (amounts in thousands):

	Pension Benefits						Other Benefits
	2015			2014			2015			2014

Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	1,594		$	1,422		$	1,300		$	997
Interest cost		59			59			50			49
Actuarial (gain) loss		(143	)		172			26			448
Benefits paid		(120	)		(59	)		(200	)		(194	)
Projected benefit obligation at end of year	$	1,390		$	1,594		$	1,176		$	1,300

Change in plan assets:
Fair value of plan assets at beginning of year	$	1,142		$	1,069		$	-		$	-
Actual return on plan assets		2			70			-			-
Employer contributions		93			62			200			194
Benefits paid		(120	)		(59	)		(200	)		(194	)
Fair value of plan assets at end of year	$	1,117		$	1,142		$	-		$	-

Funded status at end of year	$	(273	)	$	(452	)	$	(1,176	)	$	(1,300	)

Amounts recognized in Consolidated Balance Sheets:
Other non-current assets	$	(42	)	$	(32	)	$	-		$	-
Accrued expenses		-			-			138			187
Other liabilities		315			483			1,038			1,113
Total	$	273		$	451		$	1,176		$	1,300

Accumulated other comprehensive loss at December 31, 2015 and 2014 included unrecognized actuarial losses related to pension benefits of $0.6 million and $0.7 million, respectively, that had not yet been recognized in net periodic pension cost. Accumulated other comprehensive loss at December 31, 2015 included unrecognized actuarial gains related to other benefits of $0.1 million that had not yet been recognized in net periodic pension cost. The actuarial losses and gains included in accumulated other comprehensive loss and expected to be recognized in net periodic pension cost during the fiscal year ending December 31, 2016 are $40,000 loss for pension benefits and $19,000 loss for other benefits. The accumulated benefit obligation for all pension plans was $1.4 million and $1.6 million at December 31, 2015 and 2014, respectively.

The following table lists the projected benefit obligation (“PBO”), accumulated benefit obligation (“ABO”) and fair value of plan assets for the pension plans with PBOs and ABOs in excess of plan assets at December 31, (amounts in thousands):

	2015				2014
	PBO exceeds plan assets		ABO exceeds plan assets		PBO exceeds plan assets		ABO exceeds plan assets

Projected benefit obligation	$	1,390	$	1,390	$	1,594	$	1,594
Accumulated benefit obligation	$	1,390	$	1,390	$	1,594	$	1,594
Fair value of plan assets	$	1,117	$	1,117	$	1,143	$	1,143

The following table presents the assumptions used to determine the Company’s benefit obligations at December 31, 2015 and 2014 along with sensitivity of the Company’s plans to potential changes in certain key assumptions (amounts in thousands):

	Pension Benefits						Other Benefits
	2015			2014			2015			2014

Assumptions as of December 31,:
Discount rates		4.00	%		4.25	%		4.00	%		4.25	%
Expected long-term return rate on assets		5.75	%		5.75	%		N/A			N/A
Assumed rates of compensation increases		N/A			N/A			N/A			N/A
Medical trend rate pre-65 (initial)		N/A			N/A			7.75	%		8.00	%
Medical trend rate post-65 (initial)		N/A			N/A			7.25	%		7.50	%
Medical trend rate (ultimate)		N/A			N/A			5.00	%		5.00	%
Years to ultimate rate pre-65		N/A			N/A			7			8
Years to ultimate rate post-65		N/A			N/A			7			8

Impact of one-percent increase in medical trend rate:
Increase in accumulated postretirement benefit obligation							$	90		$	73
Increase in service cost and interest cost							$	4		$	2

Impact of one-percent decrease in medical trend rate:
Decrease in accumulated postretirement benefit obligation							$	78		$	66
Decrease in service cost and interest cost							$	3		$	2

The discount rate was based on several factors comparing Moody’s AA Corporate rate and actuarial-based yield curves. In determining the expected return on plan assets, the Company considers 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, the Company may consult with and consider the opinions of financial and other professionals in developing appropriate return benchmarks.

Information regarding the Company’s net periodic benefit cost for pension and other postretirement benefit plans for the years ended December 31, is as follows (amounts in thousands):

	Pension Benefits						Other Benefits
	2015			2014			2015		2014

Interest cost	$	59		$	59		$	50	$	49
Expected return on plan assets		(64	)		(63	)		-		-
Amortization of net loss		43			40			24		26
Net periodic benefit cost	$	38		$	36		$	74	$	75

The following table present estimated future benefit payments (amounts in thousands):

	Pension Benefits		Other Benefits

2016	$	316	$	138
2017		40		126
2018		82		120
2019		220		115
2020		34		109
Thereafter		509		415
	$	1,201	$	1,023

In addition to the plans described above, in 1993 the Company’s Board of Directors approved a retirement compensation program for certain officers and employees of the Company and a retirement compensation arrangement for the Company’s then Chairman and Chief Executive Officer. The Board approved a total of $3.5 million to fund such plans. Participants were allowed to defer 50% of their annual compensation as well as be eligible to participate in a profit sharing arrangement in which they vest over a five year period. In 2001, the Company limited participation to existing participants as well as discontinued any profit sharing arrangements. Participants can withdraw from the plan upon the latter of age 62 or termination from the Company. The obligation created by this plan is partially funded. Assets are held in a rabbi trust invested in various mutual funds. Gains and/or losses are earned by the participant. For the unfunded portion of the obligation, interest was accrued at 4% each year until March 2011, when interest earnings were suspended by the Company. The Company had $0.3 million recorded in accrued compensation and other liabilities at December 31, 2015 and 2014 for this obligation.

401(k) Plans

The Company offers its employees the opportunity to voluntarily participate in the 401(k) plan administered by the Company. The Company makes matching and other contributions in accordance with the provisions of the plan and, under certain provisions, at the discretion of the Company. The Company suspended matching and other contributions on January 1, 2011 and will evaluate on an annual basis whether such contributions will be reinstated. No contributions were made for 2015 and 2014.

The Company also provides Union employees, under the terms of the collective bargaining agreement, a fixed contribution to the 401(k) plan administered by the Union. The contributions were $116,000 and $123,000 for the years ended December 31, 2015 and 2014, respectively.