The Company has a 401(k) retirement investment plan (“401(k) Plan”), which is open to all eligible U.S. employees with at least six months of service. The 401(k) Plan calls for Company matching contributions on a sliding scale based on the level of the employee’s contribution. The Company may, at its discretion, make additional contributions to the 401(k) Plan based on the attainment of certain performance targets by its subsidiaries. The Company’s matching contributions are funded bi-monthly and totaled approximately $3.3 million, $3.2 million, and $3.0 million for the years 2019, 2018, and 2017, respectively. No discretionary contributions were made in 2019, 2018, or 2017.

Under the Company’s nonqualified savings plans (“NSPs”), the Company provides eligible employees the opportunity to enter into agreements for the deferral of a specified percentage of their compensation, as defined in the NSPs. The NSPs call for Company matching contributions on a sliding scale based on the level of the employee’s contribution. The obligations of the Company under such agreements to pay the deferred compensation in the future in accordance with the terms of the NSPs are unsecured general obligations of the Company. Participants have no right, interest or claim in the assets of the Company, except as unsecured general creditors. The Company has established a rabbi trust to hold, invest and reinvest deferrals and contributions under the NSPs. If a change in control of the Company occurs, as defined in the NSPs, the Company will contribute an amount to the rabbi trust sufficient to pay the obligation owed to each participant. Deferred compensation in connection with the NSPs totaled $31.9 million and $28.7 million at December 29, 2019 and December 30, 2018, respectively. The Company invests the deferrals in insurance instruments with readily determinable cash surrender values. The value of the insurance instruments was $30.1 million and $26.4 million as of December 29, 2019 and December 30, 2018, respectively.

The Company has trusteed defined benefit retirement plans which cover many of its European employees. The benefits under these defined benefit retirement plans are generally based on years of service and the employee’s average monthly compensation. In connection with the nora acquisition on August 7, 2018, the Company acquired an additional defined benefit plan, which covers certain employees in Germany (the “nora Plan”). The nora plan has no plan assets. The Company uses a year-end measurement date for the plans, which is the closest practical date to the Company’s fiscal year end.

On December 31, 2019, a plan amendment was executed to eliminate future service accruals in the Dutch defined benefit plan. The Dutch plan will remain in existence and continue to pay vested benefits. The reduction in future benefit accruals resulted in a curtailment of the plan. Participants in the Dutch plan will no longer accrue benefits under the plan after December 31, 2019, and will participate in an industry-wide multi-employer plan beginning in fiscal year 2020. Although the Dutch plan is frozen to new participants, vested benefits prior to the curtailment will continue to be accounted for in accordance with applicable accounting standards for defined benefit plans. The Dutch plan is financed by assets held in an insurance contract. The guarantee provision included in the insurance contract, that existed to fund any shortfall between the fair value of plan investments and the benefit obligation, expired on December 31, 2019. The Company will fund the cost to guarantee vested benefits and this amount will be recorded as an obligation on the Company’s Consolidated Balance Sheet.

The curtailment of the Dutch plan resulted in a decrease to the projected benefit obligation with an offsetting actuarial gain recognized in accumulated other comprehensive income of approximately $2.4 million in fiscal 2019. The accumulated net actuarial loss for the Dutch plan, after the impact of the curtailment, was $16.7 million at December 29, 2019. This amount will be reclassified out of accumulated other comprehensive income and increase pension expense over the life expectancy of vested participants when the actuarial loss exceeds the 10% corridor. The curtailment also resulted in a $0.5 million reclassification of prior service cost from accumulated other comprehensive income, which was recognized as a reduction of pension expense in fiscal 2019.

Pension expense was $2.3 million, $1.7 million, and $1.9 million for the years 2019, 2018 and 2017, respectively. Plan assets are primarily invested in insurance contracts and equity and fixed income securities. As of December 29, 2019, for the European plans, the Company had a net liability recorded of $48.4 million, an amount equal to their underfunded status, and had recorded in Other Comprehensive Income an amount equal to $47.6 million (net of taxes of approximately $16.6 million) related to the future amounts to be recorded in net post-retirement benefit costs.



	FISCAL YEAR
	2019			2018
	(in thousands)
Change in benefit obligation
Benefit obligation, beginning of year	$	285,508		$	320,548
Service cost	1,589			1,112
Interest cost	5,676			5,467
Benefits and expenses paid	(13,034		)	(11,850		)
Business combinations	—			36,903
Actuarial loss (gain)	37,409			(53,753		)
Curtailment gain	(2,421		)	—
Member contributions	221			233
Currency translation adjustment	(107		)	(13,152		)

Benefit obligation, end of year	$	314,841		$	285,508


Change in plan assets
Plan assets, beginning of year	$	249,313		$	307,166
Actual return on assets	24,999			(37,495		)
Company contributions	3,954			4,095
Benefits paid	(13,034		)	(11,850		)
Currency translation adjustment	1,218			(12,603		)

Plan assets, end of year	$	266,450		$	249,313

Reconciliation to balance sheet
Funded status benefit asset/(liability)	$	(48,391	)	$	(36,195	)

Amounts recognized in accumulated other comprehensive income (after tax)
Unrecognized actuarial loss	$	47,561		$	37,141
Unamortized prior service credits	—			(437		)
Total amount recognized	$	47,561		$	36,704


Accumulated Benefit Obligation	$	314,841		$	284,581

The above disclosure represents the aggregation of information related to the Company’s three defined benefit plans which cover many of its European employees. As of December 29, 2019 and December 30, 2018, one of these plans, which primarily covers certain employees in the United Kingdom (the “UK Plan”), had assets in excess of the accumulated benefit obligation. The nora Plan is an unfunded defined benefit plan and the accumulated benefit obligation exceeded plan assets. The following table summarizes this information as of December 29, 2019 and December 30, 2018.



	END OF FISCAL YEAR
	2019		2018
	(in thousands)
UK Plan
Projected Benefit Obligation	$	170,958	$	157,351
Accumulated Benefit Obligation	170,958		157,351
Plan Assets	174,156		158,990


Dutch Plan
Projected Benefit Obligation	$	100,996	$	91,837
Accumulated Benefit Obligation	100,996		90,910
Plan Assets	92,294		90,323


Nora Plan
Projected Benefit Obligation	$	42,887	$	36,320
Accumulated Benefit Obligation	42,887		36,320
Plan Assets	—		—



	FISCAL YEAR
	2019			2018			2017
	(in thousands)
Components of net periodic benefit cost
Service cost	$	1,589		$	1,112		$	1,628
Interest cost	5,676			5,467			5,559
Expected return on plan assets	(5,561		)	(6,234		)	(6,496		)
Amortization of prior service cost	63			(27		)	(34		)
Amortization of net actuarial (gains)/losses	991			1,394			1,287
Curtailment gain	(453		)	—			—

Net periodic benefit cost	$	2,305		$	1,712		$	1,944



	FISCAL YEAR
	2019		2018		2017
Weighted average assumptions used to determine net periodic benefit cost
Discount rate	1.9	%	1.9	%	2.0	%
Expected return on plan assets	2.1	%	1.8	%	2.3	%
Rate of compensation	1.75	%	1.75	%	1.75	%
Weighted average assumptions used to determine benefit obligations
Discount rate	1.7	%	2.5	%	2.2	%
Rate of compensation	1.75	%	1.75	%	1.75	%

The expected long-term rate of return on plan assets assumption is based on weighted average expected returns for each asset class. Expected returns reflect a combination of historical performance analysis and the forward-looking views of the financial markets, and include input from actuaries, investment service firms and investment managers.

The investment objectives of the foreign defined benefit plans are to maximize the return on the investments without exceeding the limits of the prudent pension fund investment, to ensure that the assets would be sufficient to exceed minimum funding requirements, and to achieve a favorable return against the performance expectation based on historic and projected rates of return over the short term. The goal is to optimize the long-term return on plan assets at a moderate level of risk, by balancing higher-returning assets, such as equity securities, with less volatile assets, such as fixed income securities. The assets are managed by professional investment firms and performance is evaluated periodically against specific benchmarks. The plans’ net assets did not include the Company’s own stock at December 29, 2019 or December 30, 2018.

As is common in Dutch pension plans, the Dutch Plan includes a provision for discretionary benefit increases termed “indexation.” The indexation benefit is meant to adjust pension benefits for cost-of-living increases, similar to U.S. consumer price index-based cost-of-living adjustments for U.S. retirement plans. The indexation benefit is not guaranteed, and is only provided for and paid out if sufficient assets are available due to favorable asset returns.

Both the vested benefit amounts as well as amounts related to the discretionary indexation benefits under the Dutch Plan are paid pursuant to an insurance contract with a private insurer (the “Contract”). The Plan itself is financed by investment assets held within the Contract. Prior to December 31, 2019, the Contract guaranteed payment of vested benefits, regardless of whether Plan assets held through the Contract were ultimately sufficient to pay vested amounts, and also provided for payment of the indexation amount on a contingent basis if the actual return on Dutch Plan assets were sufficient to pay it. This type of insurance arrangement is common in The Netherlands, although not necessarily common in other jurisdictions. After the plan curtailment on December 31, 2019, as discussed above, any shortfall in plan assets to pay vested benefits will be funded by the Company.

As it relates to the indexation benefit for 2017 and 2016, prior actual and future projected returns on Dutch Plan assets had been determined to be sufficient to provide for the indexation benefit for these years, therefore the Company and the insurer agreed that it was appropriate to provide the indexation benefit under the Contract. The indexation benefit became payable by the insurer under the Contract, and consequently was recorded as a Plan asset. The corresponding obligation to pay the indexation amount to pensioners thus became a pension liability. During 2018, the Company and the insurer, based on the expected future returns under the investment assets included in the insurance contract, determined that the indexation was not probable and was not included as an asset and liability as of the end of 2018.

As of December 31, 2017, this indexation liability and corresponding asset was $32.7 million. The inclusion or exclusion of this amount does not have any impact on the funded status of the plan, as both the indexation asset and liability are recorded at the same amount. This indexation asset, along with the remainder of the assets under the Dutch Plan, are identified as Level Three assets under the fair value hierarchy.

Under the express terms of the Contract, contract value is the greater of (i) the value of the discounted vested benefits of the Dutch Plan (i.e., the benefit amount guaranteed by the insurance company), and (ii) the fair value of the underlying investment assets held by the insurance company under the Contract. As between those two values, the former was the greater for 2019 and 2018 and this represents the plan assets as shown above for the Dutch Plan. However, as explained above, the Contract also will pay the indexation benefit if sufficient assets are available, which the Company believes not to be probable as of the end of 2019 based on recent returns. This indexation was considered probable as of the end of 2018, and the Company believed that it was appropriate to include the value of the indexation payments, that were added to the vested benefit amounts. As explained above, these indexation benefits will be paid out of the Contract if asset returns continue to exceed expectations. At December 30, 2018, the asset returns were not of an expected amount to allow for indexation and the Company can, at any time, remove this indexation benefit. The removal of the indexation asset is presented as a negative return on assets, and the removal of the indexation liability is represented by a change in actuarial assumptions in the company’s presentation of 2018 projected benefit obligation. The indexation benefit for 2019 is not significant.

The following table sets forth by level within the fair value hierarchy the foreign defined benefit plans’ assets at fair value, as of December 29, 2019 and December 30, 2018. The nora plan is currently unfunded. As required by accounting standards, assets are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As noted above, the Dutch pension plan assets as represented by the insurance contract are classified as a Level 3 asset and included in the “Other” asset category.

With the exception of the Dutch Plan assets as discussed above, the assets identified as level 3 above in 2019 and 2018 relate to insured annuities and direct lending assets held by the UK Plan. The fair value of these assets was calculated using the present value of the future cash flows due under the insurance annuities and for the direct lending assets the value is based on the asset value from the latest available valuation with adjustments for any drawdowns and distribution payments made between the valuation date and the reporting date. The table below indicates the change in value related to these level 3 assets during 2019 and 2018:



	FISCAL YEAR
	2019			2018
	(in thousands)
Balance of level 3 assets, beginning of year	$	109,254		$	150,977
Actual return on plan assets	5,463			(37,610		)
Purchases, sales and settlements, net	663			—
Assets transferred into level 3	2,101			696
Translation adjustment	(2,229		)	(4,809		)
Ending Balance of level 3 assets	$	115,252		$	109,254

The Company maintains a domestic non-qualified salary continuation plan (“SCP”), which is designed to induce selected officers of the Company to remain in the employ of the Company by providing them with retirement, disability and death benefits in addition to those which they may receive under the Company’s other retirement plans and benefit programs. The SCP entitles participants to: (i) retirement benefits upon normal retirement at age 65 (or early retirement as early as age 55) after completing at least 15 years of service with the Company (unless otherwise provided in the SCP), payable for the remainder of their lives (or, if elected by a participant, a reduced benefit is payable for the remainder of the participant’s life and any surviving spouse’s life) and in no event less than 10 years under the death benefit feature; (ii) disability benefits payable for the period of any total disability; and (iii) death benefits payable to the designated beneficiary of the participant for a period of up to 10 years. Benefits are determined according to one of three formulas contained in the SCP, and the SCP is administered by the Compensation Committee of the Company’s Board of Directors, which has full discretion in choosing participants and the benefit formula applicable to each. The Company’s obligations under the SCP are currently unfunded (although the Company uses insurance instruments to hedge its exposure thereunder). The Company is required to contribute the present value of its obligations thereunder to an irrevocable grantor trust in the event of a change in control as defined in the SCP. The Company uses a year-end measurement date for the domestic SCP.

The tables presented below set forth the required disclosures in accordance with applicable accounting standards, and amounts recognized in the consolidated financial statements related to the domestic SCP. There is no service cost component of the change in benefit obligation in 2019 and 2018 as there are no longer any active participants in the plan.

The accumulated benefit obligation related to the SCP was $31.7 million and $29.1 million as of December 29, 2019 and December 30, 2018, respectively. The SCP is currently unfunded; as such, the benefit obligations disclosed are also the benefit obligations in excess of the plan assets. The Company uses insurance instruments to help limit its exposure under the SCP.



	2019			2018			2017
	(in thousands, except for assumptions)
Assumptions used to determine net periodic benefit cost
Discount rate	4.10		%	3.50		%	3.85		%
Rate of compensation	—			—			—

Assumptions used to determine benefit obligations
Discount rate	3.05		%	4.10		%	3.50		%
Rate of compensation	—			—			—


Components of net periodic benefit cost
Service cost	$	—		$	—		$	—
Interest cost	1,154			1,082			1,256
Amortizations	375			464			364

Net periodic benefit cost	$	1,529		$	1,546		$	1,620