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277039 WHITE - CITY CLERK � � � � PINK � FINANCE �� C/�NARY - DEPARTMENT G I T Y O F S A I N T PA U L COUtIClI a/ N C. t BCUE - MAYOR . Fll@ N O. CITY ATTORNEY/JT • • unc�l Resolution Presented By Referred To Committee: Date Out of Committee By Date RESOLUTION APPROVING PENSION PLAN RETIREMENT DATE AND TERMINATION BENEFTTS PROVISTON AMENDMENT WHEREAS, the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota adopted effective January l, 1974, a Pension Plan for its employees which employees have been subsequently transferred to the employ of the City of Saint Paul and the Public Housing Agency of the City of Saint Paul, and these units of govern- ment have been associated in the Plan as participating employers; and WHEREAS, the Pension Committee has requested and the Finance, Management and Personnel Committee recommended Plan amendment extending mandatory retirement date to age 70 in accordance with law and extending termination benefits to age 70; Now Therefore, be it RESOLVED that the Council of the City of Saint Paul hereby approves amendment to the Pension Plan in Article IV and V Sections - "4 . 3 A Participant may, va}�ls tke ee�se�� e� tl�e ��►p�epe�= as permitted by law, remain in Employment after his Normal Retirement Date and retire from Employment on a Postponed Retirement Date, which shall be the first day of any month within the five year period immediately following his Normal Retirement Date on which he retires from Employment. " COUIVC[LMEN Requestgd by Department of: Yeas Nays Hunt Levine [n Favor Maddox McMahon B Showalter __ Against Y Tedesco Wilson Form Approved by City Attorney Adopted by Council: Date — CertifiE:d Passed by Council Secretary BY BY -- Approved by ;14avor: Date _ Approved by Mayor for Submission to Council By - BY WHITE - CITY CLERK � CANARY�- DEPARTMENT COUt1C1I �,q BEtL7E - MAYOR G I T Y O F S A I N T PA LT L File N O. � ��''"' Council Resolution Presented By Referred To Committee: Date Out of Committee By Date "5 .2 . . . A Participant may elect, prior to his Normal or Postponed Retirement Date, with approval of the Committee, upon termination of Employment to receive in a single sum an amount equal to all or a portion of the sum of his Employer Account, multiplied by the appropriate vesting percentage, and his Employee Account. The payment of such singles sum shall be in lieu of any other payment with respect to such portion for which the Participant and his beneficiary are eligible. " COUIVCILMEN Requestgd by Department of: Yeas Nays Hunt Levine In Favor — Maddox � McMahon snowaite� - __ Against BY Tedes� wlson JuN 2 � 198� Form Approved by City Attorney Adopted by Council: Date — Certified •ssed by Cou ci cr ry By v B � � � Appr :Navor: Da ��UN 2 4 �g�� Approve by Mayor for Submission to Council By By PU SHED Special Note: 2'�'7�39 The Legislation to transfer new PHA employees since September, 1917 from PERA to Mutual Benefit Life was approved by the Governor and was officially passed on 5/21/81. � . �g�� .�tr*o, CITY OF SAINT PAUL ;�+ o °� OFFICE OF THE CITY ATTORNEY � iii111t1U o . „ EDWARD P. STARR, CITY ATTORNEY �... 647 City Hall, Saint Paul,Minnesota 55102 612-298-5121 GEORGE LATIMER MAYOR -P �`7�._ �� `,,_;r�_.�s �- t ,� May 26, 1981 li To: Councilmember George McMahon, Chairman Finance, Management and Personnel Committee From: Jim Hart (5695) Chairman %---- PHA-CITY (HRA) Pension Committee : Re: Pension Plan Matters Enclosed is the 1980 Annual Report on the Pension Plan submitted for your information. There are also submitted two items respecting the Pension for action consideration. First is a proposed amendment to the Pension Plan changing mandatory retirement age from 65 to 70 years of age in conformity with law and continuing termination benefits to age 70 . Second is a request for City Council approval for expenditure of Pension Fund Special Reserve Account (Administrative Expenses) funds for consultant services regarding a change in the Pension Fund investment vehicle . Encs. cc: Council President Ron Maddox and Council Members .��,r, �`� : � � " 2'�� IMPORTANT - Please retain this report with your insurance records as this is very important material. M E M O �R A N D�J M T0: Pension Plan Participants FROM: Pension Committee ' SUBJECT: Annual Report of Your Pension Plan -� 1980 Attached is your personal copy of the Annual Report for the year 1980 covering the activities of the Pension Plan. Your Plan continues to be strong and effective, and as you know, earned at an interest rate af 9.75� for all of 1980. The Plan will earn 10.50X interest for 1981. The 1980 actual figures are not available by Mutual Benefit Life until the fall of 1981; therefore they have prepared estimates which we will use in this report so that the participants may receive this report more time than in the past. If you have any questions regarding this report, please address them to one of the Committee members. IMPORTANT - Please retain this report with your insurance records as this is very important material. � � � � �'�'�-39 ANNUAL REPORT OF THE PENSION PLAN FOR THE YEAR 1980 The Pension Comnittee in 1980 was composed of James T. Hart, Chairman and City Council designee; Kenneth A. Hansen, .Vice Chairman and PHA Administrative Employees' representative; Frank Rodriguez, representative of Locals 132 and 36 employees; Dorothy Davey, PHA Board designee; and Richard Simon, City employees' (formerly HRA) representative. Corrine Haas serves as Secretary of the Committee, and Mary Garvey serves as Recording Secretary of the committee. At its monthly meetings, the Committee has continued to work to improve the Pension Plan, to seek out the necessary f actual data from the carrier and the other resources available to review the policies of the Pension Plan, to make recommendations for improving the pension coverage for employees, and to counsel employees who are about to retire as to their benefits and options available under the Pension Plan. The Pension and Group Life Insurance Plan consists of two instruments: the Pension Plan which is an instrument administered by the Committee and a funding contract which is a Deposit Administration type group annuity with the Mutual Benefit Life Insurance Company. Interest Rates - The contract earned at an 8.50X level for 1977, 9.25� for the period 1/1/78 thru 3/10/80, 9.75% for the period 3/10/80 thru 12/31/80. The contract will earn 10.50% for 1981. Premiums Paid 1976 1977 1978 1919 1980 Pension - Employees $ 219,940 $ 222,071 $ 207,386 $ 198,889 $ 186,904 Pension - Employers 264,058 272,395 251,133 249,573 237,551 . $ 483,998 $ 494,466 $ 458,519 $ 448,462 $ 424,4!�'� Total Investment in Plan End of Year $2,219,258 $2,713,014 $3,098,147 $3,550,135 $4,041,281 - 1 - Number of Active Participants in Plan � � - 1917 1918 1979 1980 Participants as of January 1 302 269 233 198 New Entrants During Year 13 8 • 1 3 Terminations During Year 42 37 33 15 Deaths During Year -0- 1 -0- -0- Retirees During Year 4 6 3 4 Participants as of December 31 269 233 198 182 In addition to the 182 active participants, there were 43 terminated participants who had left all or a portion of their funds in the plan. Variable Funding A month by month analysis of the Variable Pension portion of the Plan follows: VALUE OF ONE UNIT MONTH 1915 1976 1977 1978 1979 980 ' January 8.95 12.930 13.434 1�1 1�0 16.232 February 9.89 12.111 13.113 12.534 14.003 15.808 March 10.53 12.970 13.115 12.797 14,872 14.923 April 10.278 12.998 13.465 13.155 14.862 15.748 May 11.551 13.023 13.182 13.998 14.785 16.405 June 11.995 13.709 13.665 13.797 15.082 16.646 July 12.233 13.545 13.381 14.491 15.254 17,722 August 11.481 13.544 13.254 15.109 16.216 17.886 September 11.441 13.829 13.309 14.620 15.836 18.164 October 11.209 13,560 12,843 13.532 15.000 18.089 November 11.435 13.577 13.372 13.704 15.485 19.035 December 11.189 14,262 13.512 13.842 15.800 19.092 , �A unit of ownership in the fund represents one share of ownership in the assets of the fund. The value is dependent upon the investments of the fund in different securities and fluctuates. Had a participant bought in on the first of 1980, and held his investment until December 31, 1980, he would have had a gain of E2.860;.per unit. Had aparticipant entered into the variable part of the plan at January 1, 1975, and held his investment until December 31, 1980, he would have had a gain of $10.142 per unit or 113.3%. The employer and the Carrier do not endorse participation or non-participation in the fund and assumes no responsibilities for the decline or increase in the value of the shares. - 2 - . - : �'��'39 Forfeiture Account (Forfeited Non-Vested Contributions Fund) - This account consists of employer contributions not vested at employee termination. This fund, at the time of entrance into the new contract, had a carryover from the o�d contract approximately $34,000. The fund consists of amounts surrendered by an employee who terminated and is not fully vested. 1976 1917 1978 1979 1980 Balance at Beginn- $48,392.69 $ .04 $17,338.91 $28,375.44 $29,663.42 ing of the Period Termination Credits 12,737.90 17,140.88 19,971.83 11,128.50 4,087.53 Termination Charges -339.76 -497.66 -841.35 -2,303.00 -0- *Expense Charges -6,759.17 -0- -9,020.14 -9,659.59 -10,722.69 Dividend Refund -0- -0- -863.92 -0- -0- Transferred to -58,284.58 -0- -0- -0- -0- Reserve Account Interest Earned 4,252.96 695.65 1,790.11 2,122.07 2,089.11 Balance at End $ .04 $17,338.91 $28,375.44 $29,663.42 a25,117.91 of Period * The forfeiture account funds have been used to pay the administrative expense charges of the plan which otherwise would have been deducted from the employer contributions. By charging these expenses to the forfeiture account, is has been possible to credit the full employer contribution to the individual participant's account. _ � _ Contingency Reserve - This is an account maintained by the Company under Group Annuity Contract GA-1052 to protect the Company against its contract risks, including interest payment guarantees and guarantee of principal of participants' accounts, among others. In meeting the interest guarantee of 9 3/4% for 1980, the Company paid $75,163 from the Contingency Reserve Account. The account is funded from corporate surplus attributable to the Pension Fund. The Contingency Reserve on the Pension Fund aggregate of $4,047,281 is $131,520. In making the interest guarantee of 10.50X on January 1, 1981, the Company is predicting an additional transfer of approximately $40,000 from the contingency Reserve Account to the Special Reserve Account. Activities During 1980 - During 1980 the Co�nittee secured Company agreement to use of the Contingency Reserve to support the guaranteed interest return at 9.75% for • March through December 1980 and 10.50� for all of 1981. � The Committee explored, and is continuing exploration of, Pension Fund investment alternatives, such as money market funds, real estate mortgages, Federal securities, time deposits, and other investments capable of producing return more reflective of inflationary trends and changes in market conditions. Our goal is an investment vehicle which would permit investment transfers in response to change in economic conditions without payment of penalties or charges. Discussions with HUD on the form of an alternative investment vehicle have been on-going with some progress. HUD would no longer require costly use of a corporate trustee, but would accept instead fiduciary insurance, investment consultation, periodic actuarial evaluations of investment of the fund, or other means of risk manipulation, the cost and efficiency of which need to be evaluated. - 4 - Activities During 1981 - Legislation which would transfer new PHA employees since September 1977 from the Public Employees Retirement Association (PERA) to our Pension Plan was recommended by the Committee and approved by the affected PH� employees, the PHA Board, and the City Council. The legislation authorized by Rep. Frank Rodriquez and Sen. Marilyn Lantry received endorsement of the Ramsey County Legislative Delegation and the Pension Commission. It has passed in the House of Representatives and is presently on the Senate floor calendar for consideration with passage anticipated before adjournment in May. Enactment of this Legislation will permit entry in the Pension Plan of new participants for the first time since October 1977. Currently there are 60 PHA employees directly affected by this Legislation. All PNA employees hired after passage of the Legislation would also participate in the Pension Plan. The effect on the growth rate of new investment in the Plan of this Legislation should be beneficial to the interest earnii�g capability of the Plan Fund. The Committee's on-going investigation of alternate investment vehicles for the Fund has reached a stage requiring more expert input into the structuring of an alternative vehicle. It is the Committees intention to obtain necessary advise and assistance for this purpose. Cost would be charged to the Forfeiture Account. The Committee wishes to emphasize that prior to subgoverning bodies, such recommendation would tirst be submitted to the participants for their consideration and recommendation by ballot in order that both the Committee and governing bodies would be aware of the participants wishes and desires. If the Committee's objective continues to be the achievement, at reasonable administrative cost, of the best investment return consistent with least risk tu the Pension Fund principal,through arrangements acceptable to the employee participant;, employer governing bodies and HUU. - 5 - r� _ . 2,��,� � RESOLUTION RECOMMENDING AMENDMENT OF PENSION PLAN RETIREMENT DATE PROVISION WHEREAS, the Pension Plan adopted effective January 1, 1974, by the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (HRA) , which P1an is presently in effect for employees of the Public Housing Agency of the City of Saint Paul (PHA) and of the City of Saint Paul, Minnesota (City) transferred from the employ of HRA, provides for normal retirement date related to the participant' s 65th birthday; and WHEREAS, under applicable provision of Federal and State law, mandatory retirement age is presently fixed at age 70, and it is necessary and desireable to amend the Pension Plan in conformity with such provision of law. NOW THEREFORE, the Pension Committee hereby approves for consideration of the PHA Board of Commissioners and City Council as the governing bodies of the employers participating in the Pension Plan, the following amendment in Article IV, Section 4 . 3 of the Pension Plan: ARTICLE IV RETIREMENT DATES 4 .1 The Normal Retirement Date for a Participant shall be the first day of the month coinciding with or otherwise next following such Participant's 65th birthday. 4 .2 The Early Retirement Date for a Participant shall be the first day of the month coinciding with or otherwise next following the date within the 10 year period immediately pre- ceding his Normal Retirement Date on which he retires from Employment. 4 . 3 A Participant may, w�tl� t�e een9ent e� tl�e �xx�g�eye�,- as permitted by law, remain in Employment after his Normal Retirement Date and retire from Employment on a Postponed Retirement Date, which shall be the first day of any month within the five year period immediately following his Normal Retirement Date on which he retires from Employment. 4 .4 The Retirement Date for a Participant shall be whichever of his Early Retirement Date, his Normal Retirement Date, or his Postponed Retirement Date, upon which he retires from Employement, except that the Retirement Date for a Participant who is entitled to receive a vested Pension in accordance with Section 5 .2 shall be his Normal Retirement Date . � ° . - 2":�`��9 -2- FURTHER, in order to continue existing Pension Plan termin- ation benefits during the extended employment period hereinbefore provided for, the Pension Committee hereby approves as an additional amendment for employer consideration, in Article V, Section 5.2 of the Pension Plan: ARTICLE V ELIGIBILITY FOR PENSION: DEATH AND TERMINATION BENEFITS 5.1 A Participant who retires from Employment on his Normal Retirement Date, Early Retirement Date, or Postponed Retirement Date shall be eligible to receive a Pension commencing on such date in an amount determined in accordance with the terms of the Group Annuity Contract by the application of his Fund Share as of such date under such Contract. 5.2 A Participant whose Employment is terminated for reasons other than death or retirement shall be eligible to receive a vested Pension commencing on his Normal Retirement Date in an amount determined in accordance with the terms of the Group Annuity Contract by the application, as of his Normal Retirement Date, of such Parti- cipant's (a) Employee Account, plus (b) his Employer Account multiplied by the appropriate vesting percentage determined from the following table: TABLE Years of Participation Vesting Percentage less than 1 0� 1 but less than 2 20� 2 but less than 3 40� 3 but less than 4 60� 4 but less than 5 80g 5 or more 1000 A Participant may elect, �rior to his Normal or Postponed Retirement Date, with approval of the Committee, upon termination of Employment to re- ceive in a single sum an amount equal to all or a portion of the sum of his Employer Account, multiplied by the appropriate vesting percentage, and his Employee Account. The payment of such singles sum shall be in lieu of any other payment with respect to such portion for which the Par- ticipant and his beneficiary are eligible . . . , , -3- 5.3 If a Participant dies on or after this date of termination but before his Normal Retirement Date and before receipt of his full-vested interest, his beneficiary shall be eligible to receive a single sum payment in an amount equal to the sum of his �nployer Account multiplied by the appropriate vesting percentage, and his Employee Account less the value of any benefits paid. Thereafter, the Plan shall have no further obligations with respect to such Participant's coverage hereunder. 5 .4 Upon the death of a Participant while in the Employment of the Employer his beneficiary shall receive a single sum payment in an amount equal to such Participant's Fund Share. However, in no event shall the Death Benefit be less than 18 times a Participant's monthly earnings. Thereafter the Plan shall have no further obligations with respect to such Participant's coverage hereunder. Adopted this 22nd day of May, 1981. Attest: �1�,_e� �,O �� Secretary • � . + • ' � . �:��3� CONSULTANT RETAINER REQUEST; PHA/CITY (HRA) PENSION PLAN The Plan. The Pension Plan is a retirement program supple- menting Social Security involving 280 participating employees of the Public Housing Agency (190) and the City of Saint Paul (90) . Contributions are at the rate of 12$ of salary, 7� employer and 5� employee in the case of PHA, and 5� employer and 7� employee in the case of the City. Employees become fully vested after five years at the rate of 20g a year. The Plan is administered by a Pension Committee consisting of two employer representatives and three employee representatives, four of whom presently are employee-participants in the Plan. Retirement benefits consist of the cash accumulation (contributions and interest earnings) accrued upon retirement. The Plan is subject to Department of Housing and Urban Development (HUD) and URISA regulation. The Fund. The Pension Fund presently is $4 �047 ,281 .00 invested under a Deposit Administration (DA) Contract with The Mutual Benefit Life Insurance Company of Newark, New Jersey (Group Annuity Contract No. GA-1052) entered into effective January 1, 1974 . Investment return experience in the past five years has been- 1977 8.5� 1978 9.25$ 1979 9. 25� 1980 9 .60� 1981 10 . 5� The Company has handled investment, withdrawal (and benefits) payments, maintenance of participants accounts records and quarterly reporting on individual accounts. Administration -2- expenses ($10,723 .00 in 1979) have been covered from employer contributions "forfeited" by participant withdrawal from the Plan before full vesting. Investment, return since 1978 has been partially funded from this source and from Company earnings allocable to this Contract ( .5o in 1979) . Alternate Investment Vehicle. Inherent limitations of the Deposit Administration investment vehicle have resulted in an investment return level which has not kept pace with the rate of inflation. The �rimary limitation has been investment restricted to common stocks. Private pensions with a varied investment portfolio have experienced a better investment return in the same five year period. It is the Pension Committee 's objective to recommend change in the investment vehicle to one producing higher return without increasing significantly the risk level to the Fund. HUD has been slow to change its regula- tions respecting permitted investments, but has under consideration proposed rule changes which permit greater flexibility. A Structure And Investment Concept. The Pension Committee could be constituted as Trustee (s) of the Fund contracting for services of an investment counselor, investment Fund assets � through investment managers, handling fund transfers, receipts and benefits payments through a banking institution (s) , con- tracting for accounting and reporting services, and obtaining periodic actuarial evaluations of Fund investment and portfolio. �, , w -3- In such structure the cost of Plan administration would increase, as would Fund investment return. The objective would be a fine balance between increased return from varied, but actuarily sound investments, and availability of competent professional advice and service in Plan administration at reasonable cost resulting in a net increase in Fund earnings over our past experience. Fund Transfer. Group Annuity Contract No. GA-1052 Section G. covers provision for transfer of the Fund to a new funding agency. Section G3 provides that as to funds exceeding $250,000, the Company may elect to make the transfer on a basis of 3� of the Fund each month after termination notice or over a period of 33 + months . Interest on the balance remaining with the Company would be "at such rate as may be determined by the Company from time to time. " Should the Contract Holder request the transfer be effected in a shorter time "a market value charge determined by the Company" would be imposed. Consultant Services . The Pension Committee has spent three years studying the foregoing matters and in order to prepare a specific recommendation for consideration by the employee- participants, the employer governing bodies and HUD, the Committee proposes to seek assistance from an experienced pension program consultant. An investment vehicle change, if approved, would require preparation of a trust instrument and related legal documents. Services of an attorney specializing in pension practice would be retained to prepare these documents and to � �y � w �� -4- advise the Committee respecting Fund transfer issues. Governing body approval of expenditure of up to $5000 from the Pension Fund Special Reserve Account for these services is requested. '� ,CI'.PY �F ►�A:�i�+''.P ��.UL ��'�� ,�;." � , � . -� : �� `;s OF +�CE OS' T�IE CZTY Cfl�Ui��iL .;� �� ,�'�� :�' ��:�.�:,� ;,- r�7i "•i1 V�sw).• n . � . 1�y'�'� . '"y_. �� '�` Date : June 19, 1981 �- ,. ,.�. . � �� - CQ � � �� R � 1� � � 1 TO : Sc�int P�c�i Ci�Py Councii �'�� : ��q�j�� pn FII'�A�JCE, P�ANAGEMENT & PERSONNEL . � George McMahon , chairrnan, makes the foflowing repor9� vn G. F. [� Ordinance (9) X[X�' Resolution Q Other � T !�!'L� : . At its meeting of June 18, 1981 , the Finance Committee recommended approva7 of the following: _ ,._...._ . ___ , _._ . . � �1 . Resolutions approving modifications in pension plan for increasing retirement- age and using Special Reserve fund for payment of consultant services. 2. Resolution approving collateral pledged by Northwestern National Bank to protect city funds held in said bank. (120�J3-GM) 3. Resolution approving collateral pledged by Sur�nit National Bank to protect city funds held in said bank. (12037-GM) 4. Resolution approving 1981 Agreement between School Service Emp7oyees, Loca1 284. (12008-GM) 5. Resolution abolishing title and class specification for Laboratory Technician and substituting new title and class specification .for Health Laboratory Technician I. (12017-GM) � 6. Resolution adjusting wage rate for title of Parking Lot Guard (Schools). (12018-GM) 7. Resolution establishing title and class specification of Medical Records Practitioner. (12045-GM) 8. Resolution establishing title and class specification for Medical Records Administrator. (12044-GM) 9. Resolution approving amendment to 1980-1981 contract to cover additional insurance plans now available. (12�48-GM) CiTY H�.LL SEVENTH FLOOR SAIN'T PAUL, �1I�fNcSO�'A 5�10? �� :. �' . ; • � �`��'� RESOLUTION RECOMMENDING AMENDMENT OF PENSION PLAN RETIREMENT DATE PROVISION WHEREAS, the Pension Plan adopted effective January 1, 1974, by the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (HRA) , �ahich Plan is presently in effect for employees of the Public Housing Agency of the City of Saint Paul (PHA) and of the City of Saint Paul, Minnesota (City) transferred from the employ of HRA, provides for normal retirement date related to the participant' s 65th birthday; and WHEREAS, under applicable provision of Federal and State law, mandatory retirement age is presently fixed at age 70, and it is necessary and desireable to amend the Pension Plan in conformity with such provision of law. NOW THEREFORE, the Pension Committee hereby approves for consideration of the PHA Board of Commissioners and City Council as the governing bodies of the employers participating in the Pension Plan, the following amendment in Article IV, Section 4. 3 of the Pension Plan: ARTICLE IV RETIREMENT DATES 4 .1 The Normal Retirement Date for a Participant shall be the first day of the month coinciding with or otherwise next following such Participant's 65th birthday. 4 .2 The Early Retirement Date for a Participant shall be the first day of the month coinciding with or otherwise next following the date within the 10 year period immediately pre- cedinq his Normal Retirement Date on which he retires from Employment. 4 . 3 A Participant may, roa�tl� t�e eensent e� ��e ��epe�; as permitted by law, remain in Employment after his Normal Retirement Date and retire from Employment on a Postponed Retirement Date, which shall be the first day of any month within the five year period immediately following his Normal Retirement Date on which he retires from Employment. 4 .4 The Retirement Date for a Participant shall be whichever of his Early Retirement Date, his , Normal Retirement Date, or his Postponed Retirement Date, upon which he retires from Employement, except that the Retirement Date for a Participant who is entitled to receive a vested Pension in accordance with Section 5 .2 shall be his Normal Retirement Date. � . .f • � , l,�t� -2- FURTHER, in order to continue existing Pension Plan termin- ation benefits during the extended employment period hereinbefore provided for, the Pension Committee hereby approves as an additional amendment for employer consideration, in Article V, Section 5.2 of the Pension Plan: ARTICLE V ELIGIBILITY FOR PENSION: DEATH AND TERMINATION BENEFITS 5.1 A Participant who retires from Employment on his Normal Retirement Date, Early Retirement Date, or Postponed Retirement Date shall be eligible to receive a Pension commencing on such date in an amount determined in accordance with the terms of the Group Annuity Contract by the application of his Fund Share as of such date under such Contract. 5.2 A Participant whose Employment is terminated for reasons other than death or retirement shall be eligible to receive a vested Pension commencing on his Normal Retirement Date in an amount determined in accordance with the terms of the Group Annuity Contract by the application, as of his Normal Retirement Date, of such Parti- cipant's (a) Employee Account, plus (b) his Employer Account multiplied by the appropriate vesting percentage determined from the following table: TABLE Years of Participation Vesting Percentage less than 1 0$ 1 but less than 2 20� 2 but less than 3 40� 3 but less than 4 60� 4 but less than 5 80� 5 or more 100� A Participant may elect, prior to h'is Normal or Postponed Retirement Date, with approval of the Committee, upon termination of Employment to re- ceive in a single sum an amount equal to all or a portion of the sum of his Employer Account, multiplied by the appropriate vesting percentage, ' and his Employee Account. The payment of such singles sum shall be in lieu of any other payment with respect to such portion for which the Par- ticipant and his beneficiary are eligible. � � � �1 �•�'.,�:�A -3- 5.3 If a Participant dies on or after this date of termination but before his Normal Retirement Date and before receipt of his full-vested interest, his beneficiary shall be eligible to receive a single sum payment in an amount equal to the sum of his Employer Account multiplied by the appropriate vesting percentage, and his Employee Account less the value of any benefits paid. Thereafter, the Plan shall have no further obligations with respect to such Participant' s coverage hereunder. 5 .4 Upon the death of a Participant while in the Employment of the Employer his beneficiary shall receive a single sum payment in an amount equal to such Participant's Fund Share. However, in no event shall the Death Benefit be less than 18 times a Participant's monthly earnings. Thereafter the Plan shall have no further obligations with respect to such Participant's coverage hereunder. Adopted this 22nd day of May, 1981. Attest: ��,�� ,� Secretary