Note 15 Employee Benefit Plans

12 Months Ended

Sep. 29, 2012

Compensation and Retirement Disclosure [Abstract]

Pension and Other Postretirement Benefits Disclosure [Text Block]

Employee Benefit Plans

The Company has various defined contribution retirement plans that cover the majority of its domestic employees. These retirement plans permit participants to elect to have contributions made to the retirement plans in the form of salary deferrals. The Company made no contributions to these plans in 2012, 2011 or 2010.

The Company sponsors deferred compensation plans for eligible employees and non-employee members of its board of directors. These plans allow eligible participants to defer payment of all or part of their compensation. Deferrals under these plans were $1.2 million and $1.9 million for 2012 and 2011, respectively. As of September 29, 2012 and October 1, 2011, approximately $10.0 million of assets and liabilities associated with these plans were recorded in other non-current assets and other long-term liabilities in the consolidated balance sheets.

Prior to its merger with Sanmina Corporation in December 2001, SCI Systems had defined benefit pension plans covering substantially all employees in the United States and Brockville, Ontario, Canada. These plans generally provided pension benefits that are based on compensation levels and years of service. Annual contributions to the plans were made according to the established laws and regulations of the applicable countries and were funded annually at amounts that approximated the maximum deductible for income taxes. Upon the merger between Sanmina Corporation and SCI Systems, benefits were calculated and frozen. Employees who had not yet vested will continue to be credited with service until vesting occurs, but no additional benefits will accrue.

The Company also provides defined benefit pension plans in certain other countries. The assumptions used for calculating the obligation for non-U.S. plans depend on the local economic environment and regulations. The measurement date for the Company's pension plans is September 29, 2012.

Changes in benefit obligations for the plans described above were as follows (in thousands):

	As of September 29, 2012						As of October 1, 2011						As of October 2, 2010
Change in Benefit Obligations	U.S.			Non-U.S.			U.S.			Non-U.S.			U.S.			Non-U.S.
Beginning projected benefit obligation	$	26,885		$	25,396		$	27,302		$	29,346		$	28,089		$	26,110
Service cost	—			666			—			599			—			396
Interest cost	1,027			1,388			1,050			1,382			1,364			1,213
Actuarial (gain) loss	4,121			9,729			656			(5,891		)	2,128			6,598
Benefits paid	(2,432		)	(722		)	(2,123		)	(723		)	(4,279		)	(773		)
Settlement / Curtailment	—			—			—			—			—			(1,252		)
Other (1)	—			(1,286		)	—			683			—			(2,946		)
Ending projected benefit obligation	$	29,601		$	35,171		$	26,885		$	25,396		$	27,302		$	29,346
Ending accumulated benefit obligation	$	29,601		$	31,917		$	26,885		$	23,374		$	27,302		$	27,871

(1)    Related to fluctuations in exchange rates between foreign currencies and the U.S. dollar.

Weighted-average actuarial assumptions used to determine benefit obligations were as follows:

	U.S. Pensions				Non-U.S. Pensions
	As of				As of
	September 29, 2012		October 1, 2011		September 29, 2012		October 1, 2011
Discount rate	2.75	%	4.00	%	4.39	%	5.80	%
Rate of compensation increases	—	%	—	%	0.97	%	0.82	%

The Company evaluates these assumptions on a regular basis taking into consideration current market conditions and historical market data. The discount rate is used to measure expected future cash flows at present value on the measurement date. This rate represents the market rate for high-quality fixed income investments. A lower discount rate would increase the present value of the benefit obligation. Other assumptions include demographic factors such as retirement, mortality, and turnover.

Changes in plan assets and funded status for the plans described above were as follows (in thousands):

	As of September 29, 2012						As of October 1, 2011						As of October 2, 2010
Change in Plan Assets	U.S.			Non-U.S.			U.S.			Non-U.S.			U.S.			Non-U.S.
Beginning fair value	$	18,809		$	26,087		$	19,216		$	26,771		$	20,164		$	17,315
Actual return	2,466			1,144			892			1,249			2,661			882
Employer contributions	1,600			295			824			294			670			11,327
Benefits paid	(2,432		)	(722		)	(2,123		)	(723		)	(4,279		)	(773		)
Actuarial loss	—			(463		)	—			(1,533		)	—			(871		)
Other (1)	—			(1,488		)	—			29			—			(1,109		)
Ending fair value	$	20,443		$	24,853		$	18,809		$	26,087		$	19,216		$	26,771
Over (under) Funded Status	$	(9,158	)	$	(10,318	)	$	(8,076	)	$	691		$	(8,086	)	$	(2,575	)

____________________

(1)    Related to fluctuations in exchange rates between foreign currencies and the US dollar.

Weighted-average asset allocations by asset category for the U.S. and non-U.S. plans were as follows:

	U.S.						Non-U.S.
	Level 1						Level 1
	As of						As of
	Target		September 29, 2012		October 1, 2011		Target		September 29, 2012		October 1, 2011
Equity securities	51	%	52.6	%	48.9	%	20	%	25.2	%	19.0	%
Debt securities	49	%	47.4	%	51.1	%	80	%	73.4	%	80.7	%
Cash	—	%	—	%	—	%	—	%	1.4	%	0.3	%
Total	100	%	100	%	100	%	100	%	100	%	100	%

In 2010, the Company adopted ASC Topic 715, Compensation- Retirement Benefits, and is required to disclose information about investment policies and strategies, categories of plan assets, fair value measurement of plan assets and significant concentrations of credit risk. The Company's investment strategy is designed to ensure that sufficient pension assets are available to pay benefits as they become due. In order to meet this objective, the Company has established targeted investment allocation percentages for equity and debt securities as noted in the preceding table. As of September 29, 2012, U.S plan assets are invested in the following SEC registered mutual funds: Core Fixed Income Fund, S&P 500 Index Fund, World Equity ex-US Fund, High Yield Bond Fund, and Emerging Market Debt Fund. These mutual funds are valued based on the net asset value (NAV) of the underlying securities in an active market, which is considered a Level 1 input under ASC Topic 820, Fair Value Measurements and Disclosures (refer to Note 5). The beneficial interest of each participant is represented in units which are issued and redeemed daily at the fund's closing NAV. Non-U.S plan assets are invested in publicly-traded mutual funds consisting of medium-term Euro bonds and stocks of companies in the European region. The mutual funds are valued using the NAV that is quoted in an active market and is considered a Level 1 input under ASC Topic 820. The plans are managed consistent with regulations or market practice of the country in which the assets are invested. As of September 29, 2012 there were no significant concentrations of credit risk related to pension plan assets.

The funded status of the plans, reconciled to the amount reported on the consolidated balance sheets, is as follows (in thousands):

	As of September 29, 2012						As of October 1, 2011						As of October 2, 2010
	U.S.			Non-U.S.			U.S.			Non-U.S.			U.S.			Non-U.S.
Over (under) Funded Status at Year End	$	(9,158	)	$	(10,318	)	$	(8,076	)	$	691		$	(8,086	)	$	(2,575	)
Unrecognized transition obligation	—			55			—			76			—			106
Unrecognized net actuarial (gain) loss	10,674			8,631			9,822			(1,706		)	10,427			2,647
Net amount recognized in Consolidated
Balance Sheet	$	1,516		$	(1,632	)	$	1,746		$	(939	)	$	2,341		$	178
Components of Net Amount Recognized in Consolidated Balance Sheet:
Non-current assets	$	—					$	—		$	4,412		$	—		$	—
Current liabilities	—			(395		)	—			(286		)	—			(263		)
Non-current liabilities	(9,158		)	(9,923		)	(8,076		)	(3,435		)	(8,086		)	(2,312		)
Accumulated other comprehensive income	10,674			8,686			9,822			(1,630		)	10,427			2,753
Net asset (liability) recognized in
Consolidated Balance Sheet	$	1,516		$	(1,632	)	$	1,746		$	(939	)	$	2,341		$	178

Estimated amortization from accumulated other comprehensive income into net periodic benefit cost in 2013 is as follows (in thousands):

	U.S.		Non-U.S.
Amortization of actuarial loss	$	1,071	$	328
Amortization of transition obligation	—		23
Total	$	1,071	$	351

Components of net periodic benefit costs were as follows (in thousands):

	As of September 29, 2012						As of October 1, 2011						As of October 2, 2010
	U.S.			Non-U.S.			U.S.			Non-U.S.			U.S.			Non-U.S.
Service cost	$	—		$	666		$	—		$	599		$	—		$	396
Interest cost	1,027			1,388			1,050			1,382			1,364			1,213
Return on plan assets	(784		)	(1,145		)	(1,162		)	(1,249		)	(1,244		)	(882		)
Settlement charge	635			—			532			—			1,382			(1,041		)
Amortization of:
Actuarial (gain) or loss	951			26			1,000			78			1,201			(190		)
Transition obligation	—			23			—			23			—			24
Net periodic benefit cost	$	1,829		$	958		$	1,420		$	833		$	2,703		$	(480	)

Weighted-average assumptions used to determine benefit costs were as follows:

	U.S. Pensions				Non-U.S. Pensions
	As of				As of
	September 29, 2012		October 1, 2011		September 29, 2012		October 1, 2011
Discount rate	4.00	%	4.00	%	5.80	%	4.64	%
Expected return on plan assets	4.25	%	6.25	%	4.80	%	4.70	%
Rate of compensation increases	—	%	—	%	0.82	%	0.38	%

The expected long-term rate of return on assets for the U.S. and non-U.S pension plans used in these calculations is assumed to be 4.25% and 4.80%, respectively. Several factors, including historical rates of returns, expectations of future returns for each major asset class in which the plan invests, the weight of each asset class in the target mix, the correlations between asset classes and their expected volatilities are considered in developing the asset return assumptions.

Estimated future benefit payments are as follows:

	Pension Benefits
	(In thousands)
2013	$	6,950
2014	$	4,010
2015	$	3,897
2016	$	3,762
2017	$	3,646
Years 2018 through 2021	$	18,975