Employee Benefit Plans

401(k) Retirement Plan

The Company sponsors a single 401(k) retirement plan covering substantially all full-time non-union employees, as well as union employees at two of its manufacturing facilities. Under the plan, employees are allowed to contribute up to 60 percent of eligible earnings to the plan, up to statutory limits. The Company contributes a match of 100 percent of the first one percent contributed and 50 percent of the next five percent contributed on eligible compensation that non-union employees contribute and according to contract terms for union employees. The Company match was $5.4 million in fiscal 2016, $4.7 million in fiscal 2015 and $4.2 million in fiscal 2014.

Deferred Compensation Plan

The Company maintains a plan that allows participants to defer compensation. The deferred compensation liability was $5.0 million and $4.2 million at February 27, 2016 and February 28, 2015, respectively. The Company has investments in corporate-owned life insurance policies (COLI) of $4.8 million and mutual funds of $0.3 million with the intention of utilizing them as a long-term funding source for this plan. The COLI assets are recorded at their net cash surrender values and are included in other non-current assets in the consolidated balance sheet.

Plans under Collective Bargaining Agreements

We contribute to various multi-employer union retirement plans, which provide retirement benefits to the majority of our union employees; none of the plans are considered significant. The total contribution to these plans in fiscal 2016, 2015 and 2014 was $3.6 million, $4.3 million and $3.7 million, respectively.

Pension Plan

The Company sponsors the Tubelite Inc. Hourly Employees' Pension Plan (Tubelite Plan), a defined-benefit pension plan that was frozen to new entrants in fiscal 2004, with no additional benefits accruing to plan participants after such time.

Officers' Supplemental Executive Retirement Plan (SERP)

The Company sponsors an unfunded SERP for the benefit of certain executives, a defined-benefit pension plan that was frozen to new entrants in fiscal 2009, with no additional benefits accruing to plan participants after such time.

Obligations and Funded Status of Defined-Benefit Pension Plans

The following tables present reconciliations of the benefit obligation of the defined-benefit pension plans and the funded status of the defined-benefit pension plans. The Tubelite plan uses a measurement date as of the calendar month-end closest to our fiscal year-end, while the SERP uses a measurement date aligned with our fiscal year-end.



(In thousands)	2016			2015
Change in projected benefit obligation
Benefit obligation beginning of period	$	16,253		$	14,274
Interest cost	566			550
Actuarial (gain) loss	(907		)	2,424
Benefits paid	(1,012		)	(995		)
Benefit obligation at measurement date	$	14,900		$	16,253
Change in plan assets
Fair value of plan assets beginning of period	$	4,419		$	4,430
Actual return on plan assets	(62		)	134
Company contributions	916			850
Benefits paid	(1,012		)	(995		)
Fair value of plan assets at measurement date	$	4,261		$	4,419
Underfunded status	$	(10,639	)	$	(11,834	)

The underfunded status of our plans is recognized in the consolidated balance sheets as:



(In thousands)	2016			2015
Current liabilities	$	(647	)	$	(648	)
Other non-current liabilities	(9,992		)	(11,186		)
Total	$	(10,639	)	$	(11,834	)

The following is included in accumulated other comprehensive loss and has not yet been recognized as a component of net periodic benefit cost:



(In thousands)	2016		2015
Net actuarial loss	$	5,899	$	6,857
Accumulated other comprehensive loss	$	5,899	$	6,857

The amount recognized in comprehensive earnings, net of tax expense, is as follows:



(In thousands)	2016			2015
Net actuarial (gain) loss	$	(610	)	$	1,458
Total	$	(610	)	$	1,458

Components of the defined-benefit pension plans' net periodic benefit cost are as follows:



(In thousands)	2016			2015			2014
Interest cost	$	566		$	550		$	538
Expected return on assets	(137		)	(171		)	(183		)
Amortization of unrecognized net loss	249			172			163
Net periodic benefit cost	$	678		$	551		$	518

Total net periodic pension benefit cost is expected to be approximately $0.7 million in fiscal 2017. The estimated net actuarial loss for the defined-benefit pension plans that will be amortized from accumulated other comprehensive loss into net periodic benefit cost for fiscal 2017 is $0.2 million, net of tax benefit.

Additional Information

Assumptions



Benefit Obligation Weighted-Average Assumptions	2016		2015		2014
Discount rate	3.85	%	3.60	%	4.00	%



Net Periodic Benefit Expense Weighted-Average Assumptions	2016		2015		2014
Discount rate	3.60	%	4.00	%	3.75	%
Expected long-term rate of return on assets	2.00	%	4.50	%	4.50	%

Discount rate. The discount rate reflects the current rate at which the defined-benefit plans' pension liabilities could be effectively settled at the end of the year based on the measurement date. The discount rate was determined by matching the expected benefit payments to payments from the Principal Discount Yield Curve. There are no known or anticipated changes in the discount rate assumption that will have a significant impact on pension expense in fiscal 2017.

Expected return on assets. To develop the expected long-term rate of return on assets, we considered historical long-term rates of return achieved by the plan investments, the plan's investment strategy, and current and projected market conditions.

In accordance with its policy, during fiscal 2016, the assets of the Tubelite plan were invested in a short-term bond fund and carried at fair value based on prices from recent trades of similar securities, which would be classified as Level 2 in the valuation hierarchy. Prior to this strategy change, the assets were invested in a long-term bond fund.

We do not maintain assets intended for the future use of the SERP.

Contributions

Pension contributions to the plans for each of fiscal 2016 and 2015 totaled $0.9 million, which equaled or exceeded the minimum funding requirement.

Estimated Future Benefit Payments

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid by the plans:



(In thousands)
Fiscal 2017	$	1,017
Fiscal 2018	1,004
Fiscal 2019	1,031
Fiscal 2020	1,016
Fiscal 2021	1,001
Fiscal 2022-2026	4,676

Employee Stock Purchase Plan

The Company also sponsors an employee stock purchase plan into which employees may contribute up to $500 per week on an after-tax basis. The Company contributes a match of 15 percent of the employee contribution. Contributions and matching funds are used to purchase shares of Company stock on the open market. The Company match to this plan was $0.1 million in each of fiscal 2016, 2015 and 2014.