Pension Fund of Credit Suisse Group (Switzerland) JPK P.O. Box Zurich. XSCH

Transcription

1 Pension Fund of Credit Suisse Group (Switzerland) JPK P.O. Box Zurich XSCH

2 Pension Fund of Credit Suisse Group (Switzerland) Pension Fund Regulations Edition of January 2005

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4 CONTENTS Page 1. GENERAL PROVISIONS GENERAL MEMBERSHIP COMMON PROVISIONS Basis of insurance Insurance benefits 8 2. ANNUITY PLAN PENSIONABLE SALARY, INSURANCE BENEFITS, FINANCING RETIREMENT PENSION BENEFITS Retirement pension Bridging pension Pensioner's child's pension DISABILITY BENEFITS Disability pension Supplementary disability pension Disabled person's child's pension BENEFITS PAYABLE IN THE EVENT OF DEATH Surviving spouse's pension Orphan's pension Lump sum payable at death BENEFITS PAYABLE WHEN LEAVING THE COMPANY Vested benefits LUMP SUM PLAN PENSIONABLE SALARY, INSURANCE BENEFITS, FINANCING RETIREMENT BENEFITS Retirement capital Bridging pension DISABILITY BENEFITS Disability pension Disabled person's child's pension BENEFITS PAYABLE IN THE EVENT OF DEATH Surviving spouse's pension Orphan's pension Lump sum payable at death BENEFITS PAYABLE WHEN LEAVING THE COMPANY Vested benefits 28 1

5 4. PROMOTION OF HOME OWNERSHIP INCOME, ASSETS AND FINANCIAL EQUILIBRIUM ORGANIZATION AND ADMINISTRATION GENERAL THE BOARD OF TRUSTEES THE MANAGER THE AUDITORS DISSOLUTION OF THE PENSION FUND TRANSITIONAL PROVISIONS FINAL PROVISIONS 39 APPENDIX ACTUARIAL RATES 40 INDEX TO THE REGULATIONS 44 2

6 1. GENERAL PROVISIONS Name 1.1 GENERAL Art. 1 The Pension Fund of Credit Suisse Group (Switzerland) is a pension plan foundation as defined by Art. 80 et seq. of the Swiss Civil Code (ZGB) and Art. 48 par. 2 and Art. 49 par. 2 of the Swiss Federal Law on Occupational Retirement, Survivors' and Disability Pension Plans (BVG/LPP). Objective Art. 2 1) The objective of the Pension Fund is to ensure the employees, together with their dependants and surviving dependants, of Credit Suisse Group as well as companies that are legally or commercially closely associated with Credit Suisse Group such as Credit Suisse First Boston and Credit Suisse, against the financial consequences of old age, disability and death in accordance with these Regulations. 2) By a resolution of the Board of Trustees and in agreement with Credit Suisse Group, employees of companies that are legally or commercially closely associated with Credit Suisse Group may also be admitted to the Pension Fund, on the condition that the Pension Fund Foundation is provided with the necessary funds. Relationship to the BVG/LPP Art. 3 1) The Pension Fund provides mandatory insurance cover in accordance with the Swiss Federal Law on Occupational Retirement, Survivors' and Disability Pension Plans (BVG/LPP) and is registered with the register of occupational pension plans of the supervisory authority of the Canton of Zurich pursuant to Art. 48 BVG/LPP. 2) The Pension Fund provides at least the legal minimum benefits under the BVG/LPP. The voluntary insurance of employees pursuant to Art. 46 and 47 BVG/LPP is excluded. Form of insurance Art. 4 The annuity plan is a defined benefits scheme. The lump sum plan is a defined contribution scheme. Liability Art. 5 Only the Pension Fund assets are liable for the Pension Fund's liabilities. Insured and pensioners have no personal liability. Art. 52 BVG/LPP is reserved. Registered office Art. 6 The registered office of the Pension Fund is in Zurich. Definitions Art. 7 The following terms are used in these Regulations (in alphabetical order): AHV/AVS Swiss Federal Old Age and Survivors' Insurance (Eidgenössische Alters- und Hinterlassenenversicherung) BVG/LPP Swiss Federal Law on Occupational Retirement, Survivors' and Disability Pension Plans (Bundesgesetz über die berufliche Alters-, Hinterlassenen- und Invalidenvorsorge). 3

7 Company Credit Suisse Group and all companies that are legally or commercially closely associated with it in the sense of Art. 2 and whose employees are insured with the Pension Fund pursuant to a resolution of the Board of Trustees. Defined benefits scheme A pension scheme where the benefits are fixed as a percentage of the pensionable salary. The contributions are calculated on the basis of the benefits. Defined contribution scheme A pension scheme where the contributions are fixed in the regulations. Death and disability benefits as well as retirement benefits are calculated on the basis of the contribution. Employee Person employed by the Company. 'Entitlement of children The children by birth or the adopted children and foster children, in accordance with Art. 49 of the Implementing Ordinance regarding the Swiss Federal Old Age and Survivors' Insurance Statute, as well as any stepchildren supported by the insured are eligible for benefits. The entitlement shall remain in effect until the end of the month in which the child reaches the age of 18. If the child has not yet finished its education the entitlement shall remain in effect until the education has been completed, but not exceeding the end of the month in which the child reaches the age of 25. The maximum pension benefits for eligible children shall be 125% of the maximum retirement pension under the AHV/AVS for one child, 200% of the maximum retirement pension under the AHV/AVS for two children and 250% of the maximum retirement pension under the AHV/AVS for three or more children. Eligibility shall expire when the child is gainfully employed or receives a salary replacement benefit from the income compensation regulations (EO/APG) or unemployment insurance (ALV/AC) and the annual income exceeds 150% of the maximum retirement pension under the AHV/AVS. Children who are receiving a federal disability pension from the IV/AI at the time of their 18th birthday shall be entitled to an orphan's pension for as long as the IV/AI continues to pay benefits. The maximum benefits payable by the Pension Fund after the age of 25 shall be 150% of the maximum retirement pension under the AHV/AVS. Fully insured Insured who are insured against the risks of death and disability as well as for retirement benefits. FZG/LFLP Swiss Federal Law on Vesting in Pension Plans (Bundesgesetz über die Freizügigkeit in der beruflichen Alters-, Hinterlassenen- und Invalidenvorsorge). Insured Employees insured by the Pension Fund. IV/AI Swiss Federal Disability Insurance (Eidgenössische Invalidenversicherung). Maximum The maximum pensionable annual salary under the annuity and lump sum plans as stipulated by the Board of Trustees. Members of the Executive Board The Members of the Executive Board in terms of these Regulations shall be designated by the Board of Trustees with the agreement of the Company. Pension Fund The Pension Fund of Credit Suisse Group (Switzerland). 4

8 Pensioners and persons who receive a disability pension Persons who receive a retirement pension or a disability pension from the Pension Fund. 'Persons insured only against the risks of death and disability' Insured who by virtue of their age are insured only against the risks of death and disability. Salary The fixed and variable salary components pursuant to Art. 29 (annuity plan) and Art. 71 (lump sum plan) paid by the Company as well as any salary replacement benefits paid by the Company (continued payment of wages, daily benefits under medical or accident insurance, benefits under maternity insurance). Supplementary Pension Fund Supplementary Pension Fund of Credit Suisse Group (Switzerland). This insures the salary components exceeding the maximum insured by the Pension Fund. Supplementary account Account used for the purchase of additional retirement benefits to eliminate a reduction in benefits in the event of early retirement. Technical retirement age The technical retirement age shall be reached: a) on the 60th birthday for members of the Executive Board; b) on the 62nd birthday for members of Senior Management; c) on the 63rd birthday for all other employees. WEF/EPL Swiss Federal Law to Encourage the Use of Vested Pension Accruals for Home Ownership (Bestimmungen über die Wohneigentumsförderung mit Mitteln der beruflichen Vorsorge). 1.2 MEMBERSHIP Basic principle Art. 8 1) Membership of the Pension Fund shall be an integral part of the employment contract with the Company. 2) All employees who must be insured in accordance with the BVG/LPP shall be obliged to join the Pension Fund. 3) The following persons shall not be insured: a) Employees whose employment contract is limited to three months or less; b) Employees whose salary is less than the minimum salary pursuant to the BVG/LPP; c) Employees who upon commencement of employment suffer from at least a 2 /3 disability as defined by the IV/AI. Commencement of insurance Art. 9 1) Insurance shall begin upon commencement of the employment relationship. From this date the insured shall be covered for the benefits defined in these Regulations. 2) If a limited employment contract is extended past three months, insurance shall commence on the date that the extension of the contract was agreed. 5

9 Admission Art. 10 1) Employees shall be covered for the risks of death and disability from January 1 of the year following of the 17th birthday and also for retirement benefits from January 1 of the year following of the 24th birthday. 2) Employees working for hourly wages shall be insured under the lump sum plan only. Information and notification requirements Art. 11 1) Employees shall inform the Pension Fund about their personal pension situation no later than upon commencement of employment and shall notify the following: a) Name and address of the previous employer's pension scheme; b) Any restrictions on pre-existing medical conditions by the previous pension scheme that have not yet expired; c) The amount of vested benefits that shall be transferred from the previous pension scheme, including the BVG/LPP retirement assets as a component of the vested benefits and, if the employee is older than 50, the accrued vested benefits at the age of 50; d) The amount of vested benefits to which the employees would have been entitled at the time of their marriage; e) The first amount of vested benefits that was notified to the employee after the FZG/LFLP came into effect; f) The amount of any advance withdrawal of retirement assets from a previous pension scheme under the promotion of home ownership scheme that has not yet been repaid, as well as details about the residential property concerned; g) The amount of any pledge of retirement assets under the promotion of home ownership scheme, as well as the name of the pledgee. 2) Pensioners and persons who receive a disability pension as well as recipients of survivors' benefits shall be obliged to notify the Pension Fund without delay about any changes material to the insurance relationship (changes in residential address, marital status, family circumstances and occupation of the children for whom orphan's or child's pensions are paid). Persons who receive a disability pension shall also be obliged to inform the Pension Fund if they receive regular income from gainful employment. They shall be liable for all damage suffered by the Pension Fund that arises from the violation of this duty to notify. Employees paid outside Switzerland Art. 12 In exceptional cases, and in agreement with the Company, the Board of Trustees may approve the insurance or continued insurance of employees paid outside Switzerland. Unpaid leave Art. 13 1) The contributions of both the insured and the Company must be paid during any leave of absence of the insured, except if otherwise agreed between the Company and the insured. 2) If the contributions are not paid, the insured benefits shall be reduced accordingly. The insurance relationship shall lapse after one year. Rejoining the company and transfer Art. 14 Insured who rejoin the Company shall be considered to be new members. Insured who transfer 6

10 from another occupational pension scheme of Credit Suisse Group to the Pension Fund shall also be considered to be new members. Termination of insurance Art. 15 1) In principle, the insurance shall end upon termination of the employment relationship, except if any retirement, disability or survivors' benefits become due. 2) Insurance cover for the risks of disability and death shall continue until the employee commences a new employment relationship, but not for longer than one month. Insurance of persons no longer employed by the Company Art. 16 1) The Board of Trustees in agreement with the Company may allow the continuance of the insurance for insured who leave the Company's service. 2) The Board of Trustees shall determine the conditions of admission for persons no longer employed by the Company. 3) The following regulations shall apply to the insurance of persons no longer employed by the Company: a) The pensionable salary at the time of termination of the employment relationship cannot be increased; b) The insured shall be responsible for their own contributions as well as the contributions of the Company; c) If the contributions are not paid, vested benefits shall become due in accordance with Art. 68 et seq. Entitlement to retirement benefits shall be determined analogously to the provisions of section 2.2; d) The technical retirement age shall be the retirement age applicable to all other employees. Any claim to vested benefits resulting from a change to the retirement age shall be used to increase the retirement benefits; e) In all other respects the provisions of the valid Regulations shall apply. 1.3 COMMON PROVISIONS Basis of insurance Change in pensionable salary Art. 17 1) The Company shall be obliged to inform the Pension Fund without delay about any changes in the effective salary. The pensionable salary shall be adjusted from the month following receipt of this notification by the Pension Fund. If the effective salary is adjusted retroactively, the contributions made by the insured and the Company must also be paid retroactively to the date of the salary change. If the insured's employment relationship has been terminated, any changes to the effective salary shall not be taken into account. 2) The following provisions shall apply to the annuity plan: a) If there is a change in the employee's number of working hours, the pensionable salary shall be re-calculated. Art. 33 par. 1 shall apply mutatis mutandis and therefore an increase in the pensionable salary shall be regarded as a new admission. In the event of a reduction in the pensionable salary the insured shall be entitled to vested benefits in the form of a 7

11 supplementary pension proportionate to the reduction. The vested benefits shall be calculated in accordance with Art. 68. b) There shall be no reduction in the pensionable salary if the co-ordination deduction increases as a result of an improvement in the AHV/AVS pension. c) If the effective fixed salary component is reduced for any reason other than a reduction in the employee's number of working hours, the insured may maintain the former pensionable salary level in agreement with the Company. d) In the case of promotion to the position of Member of the Executive Board, the increase in the actuarial reserves caused by the higher pensionable salary and the reduction in the retirement age must be borne by the insured. Art. 33 par. 1 and 2 shall apply mutatis mutandis. Medical examination Art. 18 1) New members of the Pension Fund shall submit a written statement on the condition of their health and shall confirm that they are willing to allow themselves to be examined by a medical examiner appointed by the Pension Fund and, if applicable, to accept any restrictions on preexisting medical conditions. 2) The insured shall be informed in writing about any restrictions and their duration. The restrictions shall be limited to health impairments diagnosed by the medical examiner. 3) Untrue statements by the new member as well as a refusal to be examined by the medical examiner may result in a reduction in or loss of benefits. In the event of untrue statements or a refusal to be examined by the medical examiner the Pension Fund shall be entitled to impose a restriction or to implement a reduction in benefits within six months after obtaining such knowledge. 4) Restrictions and reductions in benefits do not apply to the benefits pursuant to the BVG/LPP, or rather, they do not apply to the retirement benefits earned by the vested benefits brought into the Pension Fund. However, a restriction by the previous pension scheme that has not yet expired may be continued for a period of five years in total. If the insured becomes disabled or dies during the restriction period due to causes that can be traced back to a restriction, the exclusion shall apply to the entire duration of the benefits. Consequently, prospective benefits shall also be affected by the exclusion, unless death occurs at a later date for other reasons. 5) After five years' membership of the Pension Fund all restrictions shall lapse Insurance benefits Over-insurance Art. 19 1) The Pension Fund benefits shall be reduced if, together with benefits paid by a third party, they result in benefits of more than 90% of the presumed lost salary. 8 2) Benefits paid by a third party include: a) benefits of the Swiss Federal AHV/AVS (old age and survivors' pension); b) benefits of the Swiss Federal IV/AI (disability pension); c) benefits of the Swiss Federal MV/AM (military pension); d) benefits of the Swiss Federal UV/AA (mandatory accident insurance) and any supplementary occupational accident insurance (UVZ/LAAC), provided that the company pays at least 50% of the premiums;

12 e) benefits from foreign social insurance plans; f) benefits from other pension schemes; g) any salary replacement benefits from the Company or an insurance scheme, provided that the Company pays at least 50% of the premiums; h) in the event of disability, the continued income from gainful employment or replacement income, or any income which the insured can still be reasonably expected to earn. 3) Any pension reductions resulting from the advance withdrawal of benefits under the scheme for the promotion of home ownership shall have the same status as benefits paid by third parties. 4) For the purposes of calculating aggregate income, lump sum payments shall be converted into pensions in accordance with the Pension Fund's actuarial rates. 5) If there is any reduction in benefits, all benefits from the Pension Fund shall be affected to the same extent. 6) Any reductions in benefits shall be reviewed in the event of major changes to the benefits paid by a third party, or if any benefits should cease or become due, in which case the presumed lost salary at the time the benefits fall due shall be adjusted to be in line with the Swiss consumer price index. Compensation of reductions Art. 20 If the insured event occurred through gross negligence on the part of the beneficiary, the refusal or reduction of benefits, e.g. by the AHV/AVS, the IV/AI, the MV/AM or the obligatory UVG/LAA, shall not be compensated by the Pension Fund. Assignment of claims Art. 21 At the time of the insured event, the Pension Fund shall assume the claims of the insured, their dependants and other beneficiaries under these regulations against any third party who is liable for the insured event up to the amount of the benefits defined under Art. 64 par. 2. Payment of benefits Art. 22 1) Pension Fund benefits shall be paid as follows: a) Pensions shall be paid at the end of every month; b) Lump sum payments shall be paid within 30 days after the due date, but not before eligibility has been confirmed. 2) Place of performance shall be the registered office of the Pension Fund. 3) The Pension Fund may request proof of eligibility; if no proof is offered, the Pension Fund may postpone the payment of part or all of the benefits. 4) If benefits are shown to have been wrongfully obtained from the Pension Fund, the Pension Fund may demand immediate restitution. If reimbursement is not possible, the pension benefits shall be actuarially reduced by the outstanding amount for life. 9

13 Cost-of-living adjustments Art. 23 Retirement, disability and survivors' pensions shall undergo cost-of-living adjustments based on the financial resources of the Pension Fund. The Board of Trustees shall decide every year whether pensions can be increased, and if so, to what extent. Non-assignability of benefits Art. 24 Claims to unmatured benefits may not be assigned or pledged. The assignment of benefits to finance residential property pursuant to the WEF/EPL shall be reserved. Loss of benefits Art. 25 1) The Pension Fund may reduce or withhold benefits due in accordance with these Regulations: a) if the AHV/AVS-IV/AI reduces, withdraws or withholds a benefit because the beneficiary has caused death or disability through gross negligence; b) if the information and notification requirements towards the Pension Fund and the medical examiner are violated; c) in the event of behavior that is intended to deceive the Pension Fund, or to endanger or violate its interests, as a result of which the Pension Fund can no longer be reasonably expected to pay any benefits. 2) In any event the insured and their surviving dependants shall retain all the Pension Fund benefits that had been financed by the insured. Benefits in the event of divorce Art. 26 1) If an insured gets divorced, the vested benefits acquired during the marriage may be divided between the spouses. The court shall notify the Pension Fund of the amount to be transferred as well as any information needed for the continuation of the insurance cover. 2) The insured retirement benefits under the annuity plan shall be actuarially reduced by the amount transferred to the spouse in accordance with the tables annexed hereto. The retirement capital in the lump sum plan shall be reduced by the transferred amount. 3) The insured may compensate the reduction by purchasing additional insurance benefits. Partial liquidation/ entitlement Art. 27 1) In the case of individual departures from the Pension Fund, the insured shall be individually entitled to the available funds, and in the case of collective departures, the insured shall be individually or collectively entitled to the available funds. 2) If several insured enroll collectively in the same new pension fund (collective withdrawal), they shall be entitled to a collective proportion of the provisions and fluctuation reserves pursuant to Art. 48e BVV2/OPP2, in addition to the available funds, provided that the insurance and investment risks are also transferred. In that respect, particular attention must be paid to the type of assets to be transferred. In addition, the contribution toward provisions and fluctuation reserves of the group withdrawing can be taken into account. Partial liquidation/ regulations 10 Art. 28 1) The Board of Trustees shall issue special regulations governing partial liquidation, which set forth the precise details. These regulations shall be submitted to the supervisory authority for approval.

14 2. ANNUITY PLAN 2.1 PENSIONABLE SALARY, INSURANCE BENEFITS, FINANCING Effective salary Art. 29 The effective salary equals the annual salary subject to AHV/AVS contributions (fixed salary component), consisting of 12 monthly salaries plus, if applicable, a 13th monthly salary (but excluding bonuses, social allowances, compensation for special work, and also excluding commissions or variable salary components). Pensionable salary Art. 30 1) The pensionable salary equals the effective salary minus a co-ordination deduction calculated to take account of the benefits payable under the AHV/AVS-IV/AI. 3) The co-ordination deduction equals the full retirement pension under the AHV/AVS attributed to the effective salary. 3) The pensionable salary shall be the basis for the assessment of benefits and the calculation of the contributions. 4) The maximum pensionable salary shall be determined by the Board of Trustees. 5) In the case of part-time employees the pensionable salary shall be calculated by revaluing the part-time salary as a full salary, minus the co-ordination deduction, multiplied by the actual working hours of the employee (expressed as a percentage of the standard number of working hours). Overview of insurance benefits Art. 31 The following benefits shall be insured under the annuity plan: Retirement benefits (section 2.2) retirement pension bridging pension pensioner's child's pension Disability benefits (section 2.3) disability pension supplementary disability pension disabled person's child's pension Benefits payable in the event of death (section 2.4) surviving spouse's pension orphan's pension lump sum payable at death Benefits payable when leaving the company (section 2.5) vested benefits 11

15 Financing Art. 32 1) The liability to pay contributions shall commence upon admission to the Pension Fund and shall terminate at the end of the month for which the Company pays a salary for the last time, but not later than the end of the month following the insured's 65th birthday. 2) The insured's contribution shall be deducted from the salary and paid to the Pension Fund. 3) Until December 31 following the 24th birthday of the insured, the contribution of persons insured against the risks of death and disability shall amount to 0.75% of the pensionable salary. As from January 1 following the insured's 24th birthday the following contributions shall be paid (the higher contribution rate shall apply from the beginning of the year in which the insured reaches the age that marks the lower limit of the age category): Contribution as a percentage of the Age pensionable salary ) Until December 31 following the 24th birthday of persons insured only against the risks of death and disability, the Company shall make a contribution equivalent to 0.75% of the pensionable salary. For all other insured the Company shall make the following overall contribution: a) 167% of the total contributions paid by the insured at the technical retirement age of 63; b) 200% of the total contributions paid by the insured at the technical retirement age of 62; c) 300% of the total contributions paid by the insured at the technical retirement age 60. 5) If the Pension Fund is performing well, the Board of Trustees may reduce the contribution rates of the insured and the Company. Purchase of additional insurance benefits Art. 33 1) If the insured joins the Pension Fund after the 25th birthday, the retirement benefits shall be of reduced by a fixed amount actuarially determined in accordance with the table annexed hereto. 2) The insured and the Company may compensate the reduction by purchasing additional insurance benefits until the occurrence of an insured event in accordance with the table annexed hereto. 3) If the insured previously belonged to another pension scheme, the transfer of the vested benefits to the Pension Fund must be requested. 4) Any parts of the vested benefits that are not needed to purchase insurance cover shall be transferred to the lump sum plan. If the insured does not inform the Pension Fund otherwise, any amounts contributed by the insured that are not vested benefits shall be used to purchase additional benefits pursuant to par. 2 above. 12

16 Eliminating the reduction in retirement benefits in the event of early retirement Art. 34 1) The insured and the Company may make additional contributions to the Pension Fund in order to eliminate the reduction in retirement benefits in the event of early retirement. These contributions shall be kept in a supplementary account. 2) The purchase of additional retirement benefits shall only be possible if: a) the insured is insured against the risks of death and disability as well as for retirement benefits (insurance at full value); b) the insured brought all vested benefits into the Pension Fund; c) the insured is insured for maximum retirement benefits under the annuity plan of the Pension Fund and the supplementary Pension Fund, if applicable, taking into account any advance withdrawals for the promotion of home ownership; d) the insured does not receive a full annual disability pension. 3) The purchase of retirement benefits shall only be possible for as long as the insured's supplementary account does not exceed the discounted value of the reduction in retirement benefits. Until the 52nd birthday, the reduction in benefits which can be eliminated by buying into the Pension Fund shall amount to the sum of the monthly reductions pursuant to Art. 37 par. 2 between the technical retirement age and the 56th birthday. Between the 52nd and 55th birthdays the reduction in benefits which can be eliminated by buying into the Pension Fund shall amount to the sum of the monthly reductions pursuant to Art. 37 par. 2 between the technical retirement age and the 55th birthday. The discounted value of the reduction in retirement benefits shall be calculated in accordance with the "cash value 55" rates annexed to the Regulations. 4) If the insured is past the age of 55, the purchase of retirement benefits shall only be possible if the balance of the supplementary account is not sufficient to eliminate the reduction in retirement benefits if the pension were to be drawn immediately. 5) The reduction in retirement benefits comprises: a) the reduction pursuant to Art. 37 par. 2; b) the reduction resulting from the purchase of a bridging pension pursuant to Art. 41 par. 2; c) the reduction in the supplementary Pension Fund. 6) The supplementary account shall cease to earn interest if, despite the fact that all reductions in retirement benefits have been eliminated, the insured continue to work past their 55th birthday. In derogation of Art. 32, the contributions by the insured and the Company shall no longer be deducted from the salary, but shall be debited to the supplementary account. 7) Every year the Pension Fund shall inform the insured about the maximum possible amount for which retirement benefits may be purchased. 8) The insured may invest the funds in the supplementary account in one of a range of funds supplied by the Pension Fund. The Board of Trustees shall issue investment regulations for this purpose. 13

17 2.2 RETIREMENT BENEFITS Retirement pension Entitlement Art. 35 1) If the employment relationship with the Company is terminated after the insured s 55th birthday, the insured shall be entitled to a retirement pension. The payment of vested benefits pursuant to section 2.5 may be requested until the 60th birthday. Partial retirement with a corresponding reduction in the number of hours worked by the employee shall be possible. However, the entitlement to a retirement pension shall commence no later than the first day of the month following the 65th birthday. The retirement date shall be determined in agreement with the Company. 2) The entitlement shall expire at the end of the month following the death of the beneficiary. Insured retirement pension Art. 36 The insured retirement pension shall equal 70% of the pensionable salary minus any reductions due to a) admission to the Pension Fund after the 25th birthday; b) increase in the number of hours worked by the employee; c) advance withdrawal of retirement assets in order to acquire residential property for own use; d) transfer of vested benefits to spouse in the event of a divorce; plus any increases due to e) purchase of additional retirement benefits; f) reduction in the number of hours worked by the employee; g) repayment of the advance withdrawal of retirement assets in order to acquire residential property; h) repayment of the vested benefits paid out after a divorce. Amount of pension Art. 37 1) If pension payments are drawn from the first day of the month after attainment of the technical retirement age, the annual retirement pension shall equal the insured retirement pension. 2) If pension payments are drawn before attainment of the technical retirement age, the pension calculated in accordance with par. 1 shall be reduced by each month that lies between these two dates for the entire time that the beneficiary draws a pension. The reduction for each month between the following ages shall be: % per month or 8.0 % p.a % per month or 7.0 % p.a % per month or 6.0 % p.a % per month or 5.0 % p.a % per month or 4.0 % p.a % per month or 3.0 % p.a % per month or 3.0 % p.a % per month or 3.0 % p.a. 14

18 3) The pension reduction pursuant to par. 2 may be compensated as per the date on which the first pension payment is made. The immediate pension rates annexed hereto shall apply to the compensation of the reduction in benefits. 4) If pension payments start at any time between the technical retirement age and the 65th birthday, the retirement pension shall be increased by 0.25% for each month between the technical retirement age and the actual date on which the first pension is drawn. Deferred pension Art. 38 1) Drawing of the retirement pension may be deferred until after the 65th birthday, provided that the beneficiary predominantly remains gainfully employed. In this case, after the insured's 65th birthday, pension amounts that have not been drawn shall be credited to a special account bearing interest at the actuarial interest rate and shall be paid as a lump sum together with the first pension payment. 2) Instead of accepting the lump sum payment under par. 1, the insured may purchase a pension amount calculated in accordance with the Pension Fund's actuarial principles. 3) If the insured dies before drawing the first pension payment, the capital shall be paid to the beneficiaries pursuant to Art. 64. Lump sum Art. 39 1) At the time of retirement the insured may request a non-recurring lump sum payment amounting to a maximum of 50% of the capitalized annual pension without providing any reasons. 2) In particularly well-founded cases the Board of Trustees may give its permission for the withdrawal of a bigger lump sum payment. The Board of Trustees shall only give its permission if it is of the opinion that a lump sum payment is in the best interests of the beneficiary. 3) The request for a lump sum payment must be submitted at least six months before the date of retirement. As a result of the lump sum payment the retirement pension and survivors' pensions shall be actuarially reduced in accordance with the immediate pension rates annexed hereto. 4) In the case of insured who are married the lump sum withdrawal shall require the spouse's written permission. 5) If the pension is less than 10% of the maximum retirement benefits payable under the AHV/AVS, the insured shall receive a lump sum payment instead of pension payments Bridging pension Bridging pension from age 60 Art. 40 1) In the event of retirement after the 60th birthday the Pension Fund shall pay the insured, or rather the pensioner, a bridging pension until attainment of the AHV/AVS retirement age. The bridging pension shall equal the amount of the retirement pension, but shall not exceed 50% of the maximum retirement benefits payable under the AHV/AVS, both calculated as per the date of retirement. 2) In the event of partial retirement the insured shall be entitled to a proportional bridging pension. 15

19 Purchase of additional bridging pension benefits Art. 41 1) The insured may purchase an additional bridging pension for the period between retirement and attainment of the AHV/AVS retirement age. Together with the bridging pension pursuant to Art. 40 this pension shall not exceed the maximum retirement pension payable under the AHV/AVS. 2) The reduction of the insured retirement pension pursuant to Art. 37 shall equal 5% of the amount drawn by the insured as desired for the whole period that it is being drawn. 3) This reduction may be compensated as per the commencement of pension payments. This shall be calculated in accordance with the immediate pension rates annexed hereto. Lump sum payment Art. 42 Art. 39 of these Regulations shall apply mutatis mutandis to the lump sum payment. Death Art. 43 If the pensioner dies during the time that a bridging pension is drawn, the beneficiaries under Art. 64 shall receive the remaining amount of the bridging pension pursuant to Art. 41 without interest Pensioner's child's pension Entitlement Art. 44 Pensioners shall be eligible for a pensioner's child's pension for as long as they receive a retirement pension from the Pension Fund. The beginning and end of the entitlement to a pensioner's child's pension shall be determined by the entitlement of children pursuant to Art. 7. Amount of pension Art. 45 A pensioner's child's pension shall be paid for eligible children. The pensioner's child's pension shall equal 12.5% of the retirement pension for one child, 20% of the retirement pension for two children and 25% for three or more children. The maximum benefits pursuant to Art. 7 shall apply. 2.3 DISABILITY BENEFITS Disability pension Conditions Art. 46 1) Insured who suffer from a disability of at least 25% for reasons of ill health and who had been insured with the Pension Fund at the time when they became incapable of gainful employment for the same reason that led to the disability shall be eligible for a disability pension. 2) Disability shall be assumed if the insured are wholly or partially incapable of exercising their previous profession or otherwise doing a job that may be reasonably expected on the basis of their knowledge and abilities and taking into account their previous occupation. Determination and review Art. 47 1) The Pension Fund shall decide about the granting of disability benefits on request of the insured or the Company. The decision shall in any event be based on an expert opinion by the Pension Fund's medical examiner or on an order of the IV/AI. 16

20 2) If the level of disability changes the disability pension may be adjusted or cancelled. 3) The person who receives a disability pension shall be obliged to inform the Pension Fund without delay about any changes in the level of disability. 4) If the insured or persons receiving a disability pension refuse to allow themselves to be examined by the medical examiner ordered by the Pension Fund or if they refuse to apply to the IV/AI, the Pension Fund may suspend the benefits. Entitlement Art. 48 1) The disability pension under the Pension Fund shall become due when the insured no longer receives any salary or as soon as the insured only receives a reduced salary due to partial disability. 2) The entitlement to a disability pension shall expire upon the death of the person receiving a disability pension or when the disability is removed. Lump sum payment Art. 49 Upon attainment of the technical retirement age the person receiving a disability pension may request payment of the disability pension as a lump sum analogous to Art. 39. Amount of pension Art. 50 1) The annual full disability pension shall equal the insured retirement pension. 2) In the event of partial disability the amount of the disability pension shall be calculated according to the level of disability. 3) Any funds for the elimination of a reduction in retirement benefits in the event of early retirement in the supplementary account may be paid out as a lump sum or converted into a pension on request of the insured. Partial disability Art. 51 1) An insured who receives a partial disability pension from the Pension Fund shall be regarded as a person receiving a disability pension with regard to that part of the pensionable salary that corresponds to the level of disability, and as an insured with regard to that part of the pensionable salary that corresponds to the remaining earning capacity. 2) If an insured who is entitled to a partial disability pension under the Pension Fund leaves the Company's service, the insured shall be regarded to have left the Pension Fund with regard to that part of the pensionable salary which had not been taken into account in the calculation of the disability pension Supplementary disability pension Entitlement Art. 52 1) The supplementary disability pension is an advance on the Swiss Federal disability pension (IV/AI). Upon commencement of the IV/AI benefits the Pension Fund shall continue to pay the supplementary disability pension minus the amount of the IV/AI payments, provided that the disability level accepted by the Pension Fund is higher than the IV/AI disability level. The Pension Fund 17

21 shall be authorized to collect IV/AI back payments up to the amount of supplementary benefits paid to the insured during the same period directly from the authorities. 2) The person receiving a disability pension shall be entitled to a supplementary disability pension under the Pension Fund. The beginning of the entitlement to a supplementary disability pension shall be determined by the entitlement to a disability pension. The entitlement to a supplementary disability pension shall expire upon the death or attainment of the AHV/AVS retirement age of the person receiving a disability pension. Amount of pension Art. 53 1) The supplementary disability pension shall equal 100% of the full IV/AI pension according to the effective salary. 2) In the event of partial disability the supplementary disability pension shall be calculated according to the level of disability Disabled person's child's pension Entitlement Art. 54 Persons receiving a disability pension from the Pension Fund shall be entitled to a disabled person's child's pension for each child for as long as they receive a disability pension. The beginning and end of the entitlement to a disabled person's child's pension shall be determined by the entitlement of children pursuant to Art. 7. Amount of pension Art. 55 Disabled person's child's pensions for eligible children shall equal 12.5% of the insured disability pension for one child, 20% for two children and 25% for three or more children. The maximum benefits pursuant to Art. 7 shall apply. 2.4 BENEFITS PAYABLE IN THE EVENT OF DEATH Surviving spouse's pension Entitlement Art. 56 1) Surviving spouses of a deceased insured, pensioner or person receiving a disability pension shall be entitled to a surviving spouse's pension if they: a) are responsible for the maintenance of one or more children; b) are entitled to IV/AI benefits or become eligible for IV/AI benefits within 12 months after the death of the insured; c) have passed the age of 45 at the time of the death of the insured or the pensioner or person receiving a disability pension. 2) Surviving spouses who are not entitled to a pension shall receive a lump sum payment equal to three annual surviving spouse's pension payments. 18 3) The entitlement to a surviving spouse's pension shall commence on the first day of the month for which the salary or retirement or disability pension from the Pension Fund is cancelled, and shall lapse at the end of the month in which the surviving spouse dies or remarries.

22 Amount of pension Art. 57 1) The surviving spouse's pension shall equal 66 2 /3 % of the insured retirement pension or 66 2 /3 % of the retirement or disability pension already drawn by the deceased spouse. 2) Any funds for the elimination of a reduction in retirement benefits in the event of early retirement in the supplementary account may be paid out as a lump sum or converted into a pension on request of the surviving spouse. Reduction of benefits Art. 58 If the surviving spouse is more than 15 years younger than the insured or the pensioner or person receiving a disability pension, the surviving spouse's pension shall be reduced by 0.25% for each month exceeding the 15 years' age difference. The reduction shall be reduced by a twentieth for each complete year of marriage. Time of the marriage Art. 59 1) If the marriage took place after the 65th birthday of the insured, pensioner or person receiving a disability pension, the insured surviving spouse's pension shall be reduced to the following percentages of the total amount: a) in the event of marriage during the 66th year to 80%; b) in the event of marriage during the 67th year to 60%; c) in the event of marriage during the 68th year to 40%; d) in the event of marriage during the 69th year to 20%. 2) There shall be no entitlement pursuant to Art. 56 if the marriage took place after the insured, pensioner or person receiving a disability pension had passed the age of 69, or if at the time of the marriage the insured, pensioner or person receiving a disability pension suffered from a serious illness of which they should have been aware and death occurred within two years after the marriage as a result of this illness. Remarriage Art. 60 In the event of the remarriage of the surviving spouse a lump sum payment equal to three annual surviving spouse's pension payments shall be granted. Divorced spouse Art. 61 1) If, according to the divorce decree, a divorced spouse is entitled to a pension or was awarded a lump-sum payment to purchase a life annuity, and the marriage had lasted for at least ten years, the Pension Fund shall pay the divorced spouse a surviving spouse's pension in accordance with the BVG/LPP. In addition, one of the following conditions must be fulfilled at the time of death of the insured or the pensioner: a) the divorced spouse has passed the age of 45; b) the divorced spouse is responsible for the maintenance of one or more children. 2) However, the Pension Fund's benefits shall be reduced by the amount that, in conjunction with benefits from other insurance schemes, in particular the AHV/AVS and IV/AI and the mandatory accident insurance, exceeds the entitlement awarded in the divorce decree. 19

23 3) The subsequent purchase of retirement benefits after the transfer of part of the retirement benefits in the event of divorce shall have no effect on any pension. 4) Art. 56, Art. 58, Art. 59 and Art. 60 shall apply mutatis mutandis to the pension paid to the divorced spouse Orphan's pension Entitlement Art. 62 1) In the event of the death of an insured or a pensioner or person receiving a disability pension the children shall be entitled to an orphan's pension. 2) The orphan's pension shall become due on the first day of the month for which the salary or retirement or disability pension from the Pension Fund is discontinued. 3) The beginning and end of the entitlement to an orphan's pension shall be determined by the entitlement of children pursuant to Art. 7. Amount of pension Art. 63 1) The eligible children shall receive an orphan's pension equal to 25% for one child, 40% for two children and 50% for three or more children of the insured retirement pension or the retirement or disability pension drawn by the pensioner. If there are several orphans, the benefits shall be divided equally. 2) The amount of the orphan's pension shall be doubled for orphans who have lost both parents Lump sum payable at death Entitlement Art. 64 1) Upon the death of an insured, pensioner or person receiving a disability pension the beneficiaries pursuant to par. 2 shall be paid a lump sum payable at death. 2) The beneficiaries are (in the following sequence): a) the spouse; b) the children pursuant to Art. 7; c) natural persons who were supported to a considerable extent by the insured or the person with whom the insured had lived in a cohabitation or partnership without interruption during the five years preceding death; d) in the absence of beneficiaries under c): the children of the deceased who do not meet the entitlement criteria specified in Art. 7, the parents or the siblings; e) in the absence of beneficiaries under c) and d): other legal heirs, to the exclusion of the community. 3) The insured or pensioner may request the Pension Fund in writing to change the sequence of beneficiaries pursuant to Art. 64 par. 2 or to distribute the lump sum payable at death to several designated beneficiaries pursuant to Art. 64 par. 2., provided that this better serves the purpose of the Pension Fund. 20

24 Amount of lump sum payment Art. 65 1) If an insured dies and a surviving spouse's pension pursuant to Art. 56 is due, the lump sum payable at death shall equal one annual pensionable salary. In all other cases the lump sum payable at death shall equal the sum of the contributions to the insurance at full value (risks of death and disability as well as retirement benefits) paid by the insured without interest and any amounts paid into the Fund to purchase additional benefits with interest, as well as any funds for the elimination of a reduction in retirement benefits in the event of early retirement in the supplementary account. Any benefits already paid by the Pension Fund, any outstanding advance withdrawals of retirement assets in order to acquire residential property for own use and any lump sum payments to the insured's spouse under a divorce decree shall be deducted from the lump sum payable at death. The lump sum shall amount to at least one annual pensionable salary. 2) Upon the death of a pensioner or person receiving a disability pension the beneficiaries shall be paid a lump sum equal to two annuities minus any benefits already drawn. Special cases Art. 66 If the insured, pensioner or person receiving a disability pension does not have any beneficiary heirs pursuant to Art. 64 par. 2, the Pension Fund shall assume the funeral costs against receipt of proof of costs. 2.5 BENEFITS PAYABLE WHEN LEAVING THE COMPANY Vested benefits Entitlement Art. 67 1) A person insured only against the risks of death and disability whose employment relationship terminates before January 1 of the year following the 24th birthday shall not be entitled to any benefits under the annuity plan. 2) Any insured whose employment relationship terminates before any entitlement to retirement or disability benefits but after January 1 of the year following the 24th birthday shall be entitled to vested benefits. Vested benefits Art. 68 1) The vested benefits comprise: a) the cash value of the accrued benefits; b) the capital available in the supplementary account. 2) The cash value of the accrued benefits corresponds to the cash value of the prospective benefits at the time the insured leaves the Company's service minus the cash value of the prospective benefits that the insured could still accrue in the remaining time until attainment of the technical retirement age if the salary remains unchanged and any already agreed amounts for the purchase of additional retirement benefits are taken into account. The cash value of the accrued benefits is determined in accordance with the tables annexed hereto. 21