Pension Plan Summary Plan Description

15.3 PBGC Insurance in the Event of Plan Termination

Many of the benefits under the Plan are insured by the Pension Benefit Guaranty Corporation (PBGC) if the Plan terminates. The PBGC guarantees certain vested normal retirement benefits, early retirement benefits and certain disability and survivor's pensions. The PBGC does not, however, guarantee all types of benefits and the amount of benefit protection is subject to certain limitations.

The PBGC guarantees vested benefits at the level in effect on the date of Plan termination. If, however, benefits have been increased within the five years before Plan termination, the whole amount of the Plan's vested benefit increase may not be guaranteed. In addition, there is a ceiling on the amount of monthly benefit that the PBGC guarantees.

Under the PBGC's multiemployer plan termination program, the PBGC provides financial assistance through loans to Plans that are insolvent. A multiemployer plan, such as this Plan, is considered insolvent if the Plan is unable to pay benefits, at least equal to the PBGC's guaranteed benefit, limit when due. Before a Plan receives financial assistance form the PBGC, it must suspend payments in excess of the guarantee level.

The maximum benefit that the PBGC guarantees is set by law. Under the multiemployer program, the PBGC guarantee equals a Participant's Years of Service multiplied by:

  1. 100% of the first $11 of the monthly benefit accrual rate, and
  2. 75% of the next $33.

The PBGC's maximum guarantee limit currently is $35.75 per month times a Participant's Years of Service. Thus, the maximum annual guarantee for a pensioner with 30 years of service is $12,870. These amounts are reduced if benefits begin before age 65 and for other reasons. These amounts could change in the future.

The PBGC guarantee generally covers normal and early retirement benefits, disability benefits if you become disabled before the Plan becomes insolvent, and certain survivor death benefits. The PBGC guarantee generally does not cover (i) benefits greater than the maximum guaranteed amount set by law, (ii) benefit increases and new benefits based on Plan provisions that have been in place for fewer than five years at the earlier of the date the Plan terminates or the time the Plan becomes insolvent, (iii) benefits that are not vested because you have not worked long enough, (iv) benefits for which you have not met all of the requirements at the time the Plan becomes insolvent, and (v) non-pension benefits, such as health insurance, life insurance, certain death benefits, vacation pay and severance pay.

For more information about the PBGC and the benefits it guarantees, ask the Plan Office or contact PBGC's Technical Assistance Division, 1200 K Street, N.W. Suite 930, Washington, D.C. 20005-4026 or call 202- 326-4000 (not a toll-free number). TTY/TDD users may call the federal relay service toll-free at 1-800-877- 8339 and ask to be connected to 202-326-4000. Additional information about the PBGC's pension insurance program is available on the PBGC's website at