Note

– Pensions and Other Postretirement Benefits

The Company sponsors a defined benefit pension plan (“

Plan”) covering certain domestic employees. Benefits are based on each covered employee’s years of service and compensation. The Plan is funded in conformity with the funding requirements of applicable U.S. regulations. The Plan was closed to new participants effective

January

2008.

Employees hired after this date, in eligible locations, participate in an enhanced

401

(k) plan instead of the defined benefit pension plan. Employees hired prior to this date continue to accrue benefits.

Additionally, the Company sponsors defined contribution pension plans made available to all domestic and Canadian employees. Total contributions to the plans

were

$1.9

million for

2017

and

$1.6

million in each of the years

2016

and

2015.

The Company also sponsors a non-contributory defined benefit

postretirement health care plan that provides health benefits to certain domestic and Canadian retirees and their spouses. The Company funds the cost of these benefits as incurred. For measurement purposes, and based on maximum benefits as defined by the plan, a

zero

percent annual rate of increase in the per capita cost of covered health care benefits for domestic retirees age

and over was assumed for

2017

and is expected to remain constant going forward. A

rate of increase for all employees under age

and Canadian retirees over age

was assumed. Plan changes made during

2017

related to prescription drug coverage, spousal coverage and premiums being charged for retirees under age

resulted in a decrease in the Accumulated Postretirement Benefit Obligation at year-end.

The Company recognizes the obligations associated with its defined benefit pension plan and defined benefit

postretirement health care plan in its consolidated financial statements. The following table presents the plans’ funded status as of the measurement date reconciled with amounts recognized in the Company’s consolidated balance sheets:

	Pension Plan						Postretirement Plan
	201 7			201 6			201 7			201 6
Accumulated benefit obligation at end of year	$	63,173		$	64,033		$	17,367		$	22,340
Change in projected benefit obligation:
Benefit obligation at beginning of year	$	77,107		$	77,600		$	22,340		$	22,430
Service cost		2,727			2,837			1,249			1,192
Interest cost		2,537			2,643			814			842
Plan Changes		-			-			(6,646	)		-
Settlement		1,398			-			-			-
Benefits paid		(12,066	)		(5,510	)		(2,278	)		(1,637	)
Effect of foreign exchange		-			-			24			7
Actuarial loss (gain)		4,786			(463	)		1,864			(494	)
Benefit obligation at end of year	$	76,489		$	77,107		$	17,367		$	22,340

Change in plan assets:
Plan assets at beginning of year	$	83,318		$	68,291		$	-		$	-
Actual return on plan assets		7,550			4,537			-			-
Emplo yer contributions		2,000			16,000			2,278			1,637
Benefits paid		(12,066	)		(5,510	)		(2,278	)		(1,637	)
Plan assets at end of year		80,802			83,318			-			-
Funded status at end of year	$	4,313		$	6,211		$	(17,367	)	$	(22,340	)

	Pension Plan						Postretirement Plan
	2017			2016			2017			2016
Amounts recognized in the Consolidated Balance Sheets consist of:
Noncurrent assets	$	4,313		$	6,211		$	-		$	-
Current liabilities		-			-			(1,630	)		(1,631	)
Noncurrent liabilities		-			-			(15,737	)		(20,709	)
Total assets (liabilities)	$	4,313		$	6,211		$	(17,367	)	$	(22,340	)

Amounts recognized in accumulated other comprehensive loss consist of:
Net actuarial loss (gain)	$	24,571		$	27,041		$	(5,377	)	$	(7,890	)
Prior Service Cost		-			-			(6,646	)		-
Deferred tax (benefit) expense		(9,223	)		(10,506	)		3,683			2,978
After tax actuarial loss (gain)	$	15,348		$	16,535		$	(8,340	)	$	(4,912	)

Components of net periodic benefit cost:
	2017			2016			2015
Pension Plan
Service cost	$	2,727		$	2,837		$	3,064
Interest cost		2,537			2,643			2,640
Expected return on plan assets		(4,697	)		(4,150	)		(4,060	)
Recognized actuarial loss		1,770			2,101			2,230
Settlement loss		4,031			-			3,783
Net periodic benefit cost	$	6,368		$	3,431		$	7,657

Other changes in pension plan assets and benefit obligations recognized in other comprehensive loss:
Net (gain) loss	$	(2,470	)	$	(2,952	)	$	1,156
Total expense (income) recognized in net periodic benefit cost and other comprehensive income	$	3,898		$	479		$	8,813

Postretirement Plan
Service cost	$	1,249		$	1,192		$	1,194
Interest cost		814			842			790
Recognized actuarial gain		(677	)		(699	)		(649	)
Net periodic benefit cost	$	1,386		$	1,335		$	1,335

Other changes in po stretirement plan assets and benefit obligations recognized in other comprehensive loss:
Net (gain) loss	$	(4,105	)	$	205		$	(529	)
Total (benefit) expense recognized in net periodic benefit cost and other comprehensive income	$	(2,719	)	$	1,540		$	806

During

2017

and

2015,

the Company recorded a settlement loss relating to retirees that received lump-sum distributions from the Company’s defined benefit pension plan totaling

$4.0

million and

$3.8

million, respectively. These charges were the result of lump-sum payments to retirees which exceeded the Plan’s actuarial service and interest cost thresholds.

settlement loss was incurred in

2016.

The prior service cost is amortized on a straight-line basis over the average estimated remaining service p

eriod of active participants. The unrecognized actuarial gain or loss in excess of the greater of

10%

of the benefit obligation or the market value of plan assets is also amortized on a straight-line basis over the average estimated remaining service period of active participants.

	Pension Plan						Postretirement Plan
	201 7			201 6			201 7			201 6
Weighted-average assumptions used to determine benefit obligations at December 31:
Discount rate		3.27	%		3.60	%		3.39	%		3.77	%
Rate of compensation inc rease		3.50	%		3.50	%		–			–
Weighted-average assumptions used to determine net periodic benefit cost for years ended December 31:
Discount rate		3.27	%		3.70	%		3.77	%		3.90	%
Expected long-term rate of return on plan assets		6.00	%		6.00	%		–			–
Rate of c ompensation Increase		3.50	%		3.50	%		–			–

To enhance the Company

’s efforts to mitigate the impact of the defined benefit pension plan on its financial statements, in

2014

the Company moved towards a liability driven investing model to more closely align assets with liabilities based on when the liabilities are expected to come due. Currently, based on

2017

funding levels, equities

may

comprise between

and

27%

of the Plan’s market value. Fixed income investments

may

comprise between

70%

and

90%

of the Plan’s market value. Alternative investments

may

comprise between

and

of the Plan’s market value. Cash and cash equivalents (including all senior debt securities with less than

one

year to maturity)

may

comprise between

and

10%

of the Plan’s market value.

Financial instruments included in pension plan assets are categorized into a fair value hierarchy of

three

levels, based on the degree of subjectivity inherent in the valuation methodology. Level

assets are based on unadjusted quoted prices in a

ctive markets that are accessible to the reporting entity at the measurement date for identical assets. Level

assets are valued at inputs other than quoted prices in active markets for identical assets that are observable either directly or indirectly for substantially the full term of the assets. Level

assets are valued based on unobservable inputs for the asset (i.e., supported by little or

market activity). These inputs include management’s own assessments about the assumptions that market participants would use in pricing assets (including assumptions about risk). The level in the fair value hierarchy within which the fair value measurement is classified is determined based on the lowest level input that is significant to the fair value measure in its entirety.

All of the Plan

’s assets in the following table sets forth by asset class the Plan’s fair value of assets.

Plan fair value asset allocation by category:

201 7			%
Level 1 :
Equity	$	14,637		18	%
Fixed income		12,573		16	%
Mutual funds		857		1	%
Money funds and cash		6,173		8	%
Total Level 1		34,240		43	%
Level 2 :
Fixed income		46,556		57	%
Money funds
Total Level 2		46,556		57	%
Level 3:
Equity		6		-
Total Level 3		6		-
Total fair value of Plan assets	$	80,802		100	%

2016			%
Level 1:
Equity	$	19,752		24	%
Fixed income		11,805		14	%
Mutual funds		-		-
Money f unds and cash		11,134		13	%
Total Level 1		42,691		51	%
Level 2:
Fixed income		40,597		49	%
Money fund s		-		-
Total Level 2		40,597		49	%
Level 3:
Equity		30		-
Total Level 3		30		-
Total fair value of Plan assets	$	83,318		100	%

Contributions

The Company

expects to contribute

million to its defined benefit pension plan in

2018.

Expected future benefit payments

The following benefit payments are expected to be paid as follows based on actu

arial calculations:

	201 8		201 9		20 20		202 1		202 2		Thereafter
Pension	$	4,274	$	4,251	$	5,427	$	5,046	$	5,964	$	26,953
Postretirement		1,657		1,519		1,373		1,215		1,157		5,960

one

percentage point increase in the assumed health care trend rate would increase postretirement expense by approximately $

271,000,

changing the benefit obligation by approximately

$1.6

million; while a

one

percentage point decrease in the assumed health care trend rate would decrease postretirement health care expense by approximately

$233,000,

changing the benefit obligation by approximately

$1.4

million. The assumed trend rates for healthcare costs are a

increase per year for retirees prior to the age

and

for retirees post age

65.

rate of increase for all employees under age

and Canadian retirees over age

was assumed.

one

percentage point change in the assumed rate of return on the defined benefit pension plan assets is

estimated to have an approximate

$783,000

effect on pension expense. Additionally, a

one

percentage point increase in the discount rate is estimated to have a

$1.2

million decrease in pension expense, while a

one

percentage point decrease in the discount rate is estimated to have a

$1.4

million increase in pension expense.