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Pension Plan
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Types of Retirement Benefits

Normal and Late Retirement Benefits

Eligibility for Normal or Late Retirement Benefits

A Participant who retires on a Normal or Late Retirement Datewill be entitled to an annual Normal or Late Retirement Benefit, respectively. A Participant's Normal Retirement Date is the first day of the month coinciding with or next following the date he or she is both age 65 and vested (see page 7).  (A Participant's Late Retirement Date is the first of any month following his or her Normal Retirement Date but generally, not later than April 1 following the year the vested Participant reaches age 70-1/2, called "Required Beginning Date").*  This means Participants who have less than five Qualified Years when they reach age 65 must have participated in the Plan for at least five years disregarding participation prior to January 1, 1998 (or at least four years if the Participant earned a Qualified Year after age 60 and those years occur after January 1, 2003) in order to be eligible to receive a Normal or Late Retirement Benefit (see Normal Retirement Date on page 7).

* For any Participant who reached age 70-1/2 before 1988 (other than a 5% owner), his or her Required Beginning Date is the later of the April 1 following: (i) the year the vested Participant reached age 70-1/2, or (ii) the calendar year in which he or she ceased work in covered employment.

Example 1:

William has accrued five Qualified Years A Plan Year in which the Participant earned at least eight Credited Weeks. and reaches age 65 on June 15, 2013. William's Normal Retirement Date is July 1, 2013.

Example 2:

Peter has accrued eight Qualified Years and reached age 65 on August 2, 1991. He started participating in the Plan on January 1, 1980 and has not incurred a Permanent Break in Service.  Peter is vested and his Normal Retirement Date Normal Retirement Date is the first day of the month following the date the Participant has both reached age 65 and completed the required participation in the Plan. is September 1, 1991.

Example 3:

Georgina has accrued three Qualified Years and reaches age 65 on March 20, 2012.  Her participation in the Plan started January 1, 2008 and she has not incurred a  Permanent Break in Service Prior to January 1, 1998, if a Participant has five consecutive One-Year Breaks in Service before he becomes vested, his earlier Qualified Years and accumulated contributions will be forfeited and his participation in the Plan will be terminated. Effective January 1, 1998, this rule no longer applies to Qualified Years, although service and benefits forfeited prior to 1998 due to a permanent Break in Service will remain forfeited. However, the Break in Service rules continue to apply to counting years of participation for purposes of determining your Normal Retirement Date. . Georgina's Normal Retirement Date is January 1, 2013: the first of the month following the date she has both attained age 65 and completed four years of participation after January 1, 1988.

REMEMBER:  A Participant is only eligible to receive benefits at age 65 with less than five Qualified Years if he or she has not lost the Qualified Years through a Permanent Break in Service and has reached his or her Normal Retirement Date.

Amount of Normal Retirement Benefit

The annual amount of the Normal Retirement Benefit is generally equal to 48.30% (effective as of January 1, 2000) of the contributions required to be made to the Plan on the Participant's behalf by Employers. This describes the annual amount of the Normal Retirement Benefit when paid in the form of a Five-Year Certain and Life Annuity, with the monthly amount being one twelfth of the annual amount. If benefits are paid in another form of benefit (see page 16), the amount is adjusted to reflect that form of benefit.

Please note that certain contributions do not count in determining the benefit amount. Effective as of May 2, 2011, any contributions made (or required to be made) to the Plan on a Participant's behalf by Employers above six percent (6%) of Covered Earnings shall not be taken into account for purposes of calculating or accruing any benefit payable to the Participant or his or her Beneficiary. Moreover, the Internal Revenue Code imposes limits on the amount of compensation in any year that the Plan may recognize for purposes of determining the benefit accrual for that year so contributions made to the Plan on compensation exceeding that limit are not taken into account in determining the amount of the Participant's benefit. There are also limits on the amount of benefit a Participant can receive from the Plan each year. (These limits are described in greater detail on page 32.) In addition, as described above, if a Participant had a Permanent Break in Service prior to 1998, contributions made on or prior to the Permanent Break in Service are ignored.

Example:

A married Participant age 65 retires with five Qualified Years A Plan Year in which the Participant earned at least eight Credited Weeks. on January 1, 2012. The Participant's spouse is age 60. The contributions up to 6% made to the Plan on the Participant's behalf total $30,000. The monthly Normal Retirement Benefit is computed as follows:

  1. 48.30% of $30,000 = $14,490 (total annual benefit)
  2. $14,490 ÷ 12 = $1,207.50 (monthly benefit)
  3. Because the Participant is married, the Participant's benefits are paid as a Joint and 50% Survivor Annuity (see page 16). The factor used for adjusting the benefit for this form is 88% (based upon the difference in age between the Participant and spouse).
  4. 88% of $1,207.50 = $1,062.60 per month is payable to the Participant for life. Upon the Participant's death, 50% of that benefit ($531.30) is payable for life to the spouse to whom the Participant was married at the time of retirement. (If the Participant and spouse decide they do not want the Joint and 50% Survivor Annuity, they must elect another form of benefit payment as described on page 16).
Amount of Late Retirement Benefit

The benefits for a Participant who retires on a Late Retirement DateLate Retirement Date is the first day of any month subsequent to the Participant’s Normal Retirement Date, which the Participant has selected as the date of his retirement. In no event, however, will such date be later than the Participant’s Required Beginning Date (i.e., generally the April 1 following the calendar year in which the vested Participant reaches age 70½). will be adjusted to reflect the delay in the start of benefits. For each Plan Year after the Participant's Normal Retirement Date Normal Retirement Date is the first day of the month following the date the Participant has both reached age 65 and completed the required participation in the Plan. , the Normal Retirement Benefit amount will be increased to include the additional contributions made on the Participant's behalf or an actuarial adjustment, whichever yields the greatest benefit. The actuarial adjustment is .8% per month for the first 59 months after attainment of age 65 and 1.2% for each month thereafter.

Example:

As in the above example, let's assume a married Participant with five Qualified Years has $30,000 in contributions to the Plan when he reaches age 65 on December 20, 2009. However, instead of retiring he continues to work in covered employment and has contributions of $3,000 in 2010 and $1,000 in 2011, and then retires on September 1, 2011. The monthly Late Retirement Benefit is computed as follows:

  1. Annual Benefit payable at Normal Retirement Date (January 1, 2010) = 48.30% of $30,000 = $14,490.
  2. 2010 adjustment equals the greater of:
    1. $3,000 of contributions in 2010
      $14,490 + (48.30% x $3,000) = $15,939 as of
      December, 31, 2010; or
    2. Actuarial increase = 12 months x .8% = 9.6%
      $14,490 x 1.096 = $15,881.04 as of December 31, 2010.
  3. The 2011 adjustment is applied to the retirement benefit at
    the end of 2010 (i.e., the greater of 2.a. or 2.b., or $15,939.
    The 2011 adjustment equals the greater of:
    1. $1,000 of contributions in 2011
      $15,939 + (48.30% x $1,000) = $16,422 as of
      September 1, 2011; or
    2. Actuarial increase = 8 months x .8% = 6.4%
      $15,939 x 1.064 = $16,959.10 as of
      September 1, 2011.
  4. The monthly benefit payable when the Participant retires
    on September 1, 2011 is the greater of 3.a. or 3.b. divided
    by 12, or $16,959.10 ÷ 12 = $1,413.26.

The monthly benefit is reduced if any form of benefit other than a Five-Year Certain and Life Annuity is elected.