BAY AREA PAINTERS AND TAPERS ANNUITY PLAN. Summary Plan Description Edition

Transcription

1 BAY AREA PAINTERS AND TAPERS ANNUITY PLAN Summary Plan Description 2002 Edition

2 BAY AREA PAINTERS AND TAPERS ANNUITY PLAN This explanation of the Annuity Plan is no more than a brief and very general statement of the most important provisions of the Annuity Plan. No general statement such as this can adequately reflect all of the details of the Plan. Nothing in this statement is meant to interpret or extend or change in any way the provisions expressed in the Plan itself. The rights of the Participant or Beneficiary can only be determined by consulting the actual text of the Annuity Plan, which is printed in the last part of this booklet. ONLY THE FULL BOARD OF TRUSTEES IS AUTHORIZED TO INTERPRET THE PLAN OF BENEFITS DESCRIBED IN THIS BOOKLET. NO EMPLOYER OR UNION, NOR ANY REPRPRESENTATIVE OF ANY EMPLOYER OR UNION, IS AUTHORIZED TO INTERPRET THIS PLAN NOR CAN SUCH PERSON ACT AS AN AGENT OF THE BOARD OF TRUSTEES. If you have any questions about the rules of the Annuity Plan and how they apply to you, contact the Fund Office. Do not rely on information from other sources. The staff at the Fund Office has up-to-date information on the operation of the Plan and is available to assist you. SUMMARY PLAN DESCRIPTION 2

3 BAY AREA PAINTERS AND TAPERS ANNUITY FUND One Lawrence Avenue San Francisco, California Telephone: Fax: BOARD OF TRUSTEES Employee Trustees Hayden Blaylock Tommy Caster William Cummings Fred Inman Gene Massey Les Proteau Employer Trustees David Ayala Ronald Becht Tom Daniels Charles Del Monte Jason Fell Len Fregosi John Lawrence Ray Monks Buck Smith LEGAL COUNSEL Van Bourg, Weinberg, Roger & Rosenfeld Wylie, McBride, Jesinger, Sure & Platten ADMINISTRATOR Bay Area Painters and Tapers Trust Funds CONSULTANT The Segal Company 3

4 BAY AREA PAINTERS AND TAPERS ANNUITY PLAN DEAR PARTICIPANT: We are pleased to provide you with this summary describing the provisions of your Annuity Plan. There have been several changes since the last booklet was printed, so we encourage you to read this new booklet carefully. Particular attention should be given to the rules governing the following: Participation Benefits for periods of military service Waiver of joint & survivor annuity Minimum benefit payment This Plan will provide an additional measure of financial security and flexibility for you and your family upon retirement. In addition to retirement benefits, this Plan also provides benefits upon death, disability or job termination. In the first section of this booklet, you will find SOME QUESTIONS AND ANSWERS ABOUT YOUR PLAN which are intended to summarize the principal features of the Annuity Plan. In all cases, the actual text of the Annuity Plan governs every aspect of participation, eligibility, benefit payments and, in general, the administration of the Annuity Plan. Accordingly, you should refer to the actual text of the Annuity Plan, which appears in the second half of this booklet. We urge you to share this booklet with your family, since they may have an interest in the Plan. Also be sure to keep this booklet for future reference and let members of your family know where it is being kept. It contains information concerning what may be substantial sums of money to which you or your beneficiary may be entitled. If you have any questions about the Plan or desire any additional information, please contact the Fund Office. You should understand, however, that only the Board of Trustees can amend or change the terms of the Plan and that this authority cannot be delegated to the Fund Office or its employees. Sincerely, BOARD OF TRUSTEES 4

5 TABLE OF CONTENTS SUMMARY...1 SOME QUESTIONS AND ANSWERS ABOUT YOUR PLAN...7 A. PLAN PARTICIPATION How do I know if I am a Participant in the Annuity Plan?... 7 B. INDIVIUDAL ACCOUNTS What is an Individual Account? What is the Valuation Date? What is an Accumulated Share? What determines the value of any Accumulated Share in my Individual Account at any time? Will contributions be made on my behalf for periods of military service? Will I receive a statement showing the status of my Individual Account? What should I do if the statement does not show contributions from an employer for whom I worked as a painter or taper during the year?... 8 C. PAYMENT OF BENEFITS What is the exact amount of money I will get when I am eligible for benefits? What is the Plan s minimum payment provision? When can I receive the money in my Individual Account? Do I have to withdraw the money in my Individual Account as soon as I am eligible for benefits? In what form of payment will my Individual Account be paid out? May I choose a form of payment other than the Joint and Survivor Annuity even if I am married? What happens if I withdraw the money in my Individual Account and then start working again?...12 D. DESIGNATION OF BENEFICIARY AND ASSIGNMENT OF BENEFITS How do I designate a beneficiary for my Accumulated Share? Page

6 17. What happens if I do not designate a beneficiary or if my designated beneficiary dies? May I assign my Individual Account or any other right or benefit under the Plan? What is a Qualified Domestic Relations Order?...13 E. TAXES Do I have to pay tax on the money in my Individual Account?...13 F. APPLICATION AND APPEAL PROCEDURES What is the application procedure for payment of my Accumulated Share? What if I fail to apply for payment of my Accumulated Share? What is the procedure to follow if an applicant is denied? G. AVAILABILITY OF PLAN DOCUMENTS Are Plan documents available to Participants and Beneficiaries? NOTICE OF EARLY DISTRIBUTION PENALTY...16 INFORMATION REQUIRED BY THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF STATEMENT OF ERISA RIGHTS...19 ANNUITY PLAN...21 Article 1. DEFINITIONS...23 Article 2. PARTICIPATION...28 Article 3. INDIVIDUAL ACCOUNTS...29 Article 4. BENEFITS AND ELIGIBILITY...32 Article 5. GENERAL PROVISIONS

7 SOME QUESTIONS AND ANSWERS ABOUT YOUR PLAN A. PLAN PARTICIPATION 1. Q. How do I know if I am a Participant in the Annuity Plan? A. In general, if you are working for an employer covered by a Collective Bargaining Agreement that requires contributions to be made to the Bay Area Painters and Tapers Pension Trust Fund with respect to your work, you are a Participant in the Annuity Plan after your first Hour of Work. B. INDIVIDUAL ACCOUNTS 2. Q. What is an Individual Account? A. The term Individual Account describes the account established in your name to receive contributions made by your employers on your behalf. Your Individual Account is set up as of the Valuation Date following the date you become a Participant in the Annuity Plan. 3. Q. What is the Valuation Date? A. On December 31 of each year, the value of each Individual Account is fixed. December 31 is known as the Valuation Date. That date is selected as the Valuation Date because it is the last business day of the Fund s fiscal year. The value is fixed as of this date by combining the following factors to determine the value of your account: Prior balance (if any), contributions, investment income, and the expenses of operating the Plan. 4. Q. What is an Accumulated Share? A. Your Accumulated Share is the value of your Individual Account plus the amount of contributions paid on your behalf since the previous Valuation Date. 5. Q. What determines the value of any Accumulated Share in my Individual Account at any time? A. At any time other than at the Valuation Date, your Accumulated Share is represented by that which is explained in Question 4A. As of the Valuation Date, your Accumulated Share is represented by the following: - Employer contributions paid on your behalf increased by: 7

8 - Investment earnings, net of investment-related expenses, which are credited to your account as of the Valuation Date. Investment earnings include interest, dividends, and realized and unrealized gains and losses on the Plan s invested assets, guidelines for which are established by the Board of Trustees and reduced by: - A charge to your account for your pro-rata share of the Plan s operating expenses. 6. Q. Will contributions be made on my behalf for periods of military service? A. If you serve in the uniformed services of the United States and are subsequently reemployed by an employer, you may qualify for contributions to be made to the Annuity Plan for such period(s) under the Uniformed Services Employment and Reemployment Rights Act of 1994 or USERRA. In order to qualify for the contributions you must satisfy the following requirements: Work for an employer in covered employment prior to your military service. Termination/discharge from the military service under honorable conditions. Satisfy USERRA s advance notice (to employer) requirement prior to your leave. Remain on leave for no more than five years. Apply for reemployment within the time frame specified by USERRA. The amount of the contributions made for your military leave will be based upon your average hours of work and the average rate of contributions for all Employees during the 12-month period immediately preceding the period of military service or, if shorter, the period of employment immediately preceding the military service. 7. Q. Will I receive a statement showing the status of my Individual Account? A. If you are a Participant, you will receive a statement from the Fund Office at least once every year showing the actual employer contributions paid with respect to your work in the previous fiscal year and the value of your Individual Account. 8. Q. What should I do if the statement does not show contributions from an employer for whom I worked as a painter or taper during the year? A. It is very important that you carefully check the statement that you receive from the Fund Office and notify the Fund Office immediately if you believe there is an error or if one of your employers has not made the required contributions on your behalf. C. PAYMENT OF BENEFITS 8

9 9. Q. What is the exact amount of money I will get when I am eligible for benefits? A. Due to the fluctuation in the amount of yield on investments, the exact amount you will receive in the future when you are eligible for benefits cannot be determined now. Here is how the amount you will receive will be calculated: (1) The sum of all the contributions received on your behalf; plus (2) All actual investment earnings credited to your Individual Account; plus or minus (3) Changes in the value of the Fund s investments; minus (4) Your share of the expenses of operating the Fund. A statement will be sent to you annually showing you the status of your Individual Account in terms of contributions, expenses and investment yields for the previous 12-month period beginning on January 1 and ending on December Q. What is the Plan s minimum payment provision? A. The Plan s minimum payment provision requires that in order for you to receive payment of your Individual Account, the Account balance must be $50.00 or greater, and you must satisfy one of eligibility requirements described in Q&A 11. No payment shall be made if the Account balance is less than $ Such forfeitures will be used to defray the Fund s operating expenses. This provision does not apply if you: (1) Previously retired and received payment of the money in your Individual Account; and (2) Later returned to covered employment and had a new Individual Account established on your behalf; and (3) Received a pension from the Bay Area Painters and Tapers Pension Trust Fund immediately before returning to covered employment; and (4) Have retired again and are in receipt of a pension from the Bay Area Painters and Tapers Pension Trust Fund. 11. Q. When can I receive the money in my Individual Account? A. If the value of your Individual Account is $50.00 or more, you can receive the money in your account at any of the following times: (1) At Retirement 9

10 If you are receiving a pension from the Bay Area Painters and Tapers Pension Trust Fund, you are entitled to receive the money in your Individual Account. (2) When You Stop Working as a Painter or Taper Regardless of your age, you may apply for payment of the money in your Individual Account if: You have been employed fewer than 400 hours in work covered by a Collective Bargaining Agreement, for which contributions are made, or required to be made, in any one of two consecutive calendar years. No contributions are made, or are required to be made, on your behalf for a period of six consecutive calendar months, and since that time you have not and are not working in covered employment as a painter or taper within the geographic area covered by the Plan. (3) If You are Entitled to a Social Security Disability Benefit Regardless of your age, if you are totally and permanently disabled, and entitled to a Social Security Disability Benefit, you may apply for the money in your Individual Account. (4) If You Die If you die, any money in your Individual Account will be paid to your designated beneficiary in either a lump sum or an annuity. This applies whether you were still working at the time of death, or you were retired and receiving monthly payments from the Plan. In addition, upon application, a distribution from your Individual Account will be made to a designated alternate payee in accordance with a Qualified Domestic Relations Order (QDRO), regardless of whether you have received a distribution based on one of the events described above. 12. Q. Do I have to withdraw the money in my Individual Account as soon as I am eligible for benefits? A. You do not have to withdraw the money in your Individual Account immediately, but Federal law requires that payment of your benefits begins no later than April 1 following the calendar year in which you reach age 70½. 13. Q. In what form of payment will my Individual Account be paid out? A. When you qualify for a payment, you may receive your individual Account balance in one of the forms described in this section. If the money in your 10

11 account is $5000 or less, your account must be paid in a lump sum, in accordance with federal law. If you are single and your Individual Account is greater than $5,000, the normal form of payment (unless otherwise specified) is a single life annuity. If you are legally married throughout the one-year period prior to retirement, the normal form of payment is a qualified joint and survivor annuity unless you have filed a timely election to waive that form of annuity, subject to the terms described in Q&A 14. The following forms of payments are available under the Plan: Life Annuity An annuity purchased from a life insurance company with (1) monthly payments made to you for the duration of your life and all payments stopping on your death or (2) monthly payments made to you for the duration of your life and, in the event of your death, the continuation of benefits for the lifetime of your designated beneficiary. Lump Sum The Plan will provide a lump sum payment equal to the value of your Individual Account. 50% Qualified Joint and Survivor Annuity An annuity purchased from a life insurance company with your Individual Account to provide monthly payments for your life. The amount you receive at retirement will be reduced to take into account the expected life spans of both you and your spouse. Once your payments start, the amount will not be increased if your spouse predeceases you, or if you and your spouse are later divorced. Combination of Life Annuity and Lump Sum Subject to the requirements regarding the joint and survivor annuity, if you fail to elect a specific form of distribution, a non-transferable annuity contract providing monthly annuity payments for your lifetime shall be purchased from a licensed insurance company. If you elect to receive your distribution in the form of a Lump Sum, special tax requirements may apply (see TAXES on page ). 14. Q. May I choose a form of payment other than the Joint and Survivor Annuity even if I am married? A. You may reject the joint and survivor annuity with your spouse s consent. You and your spouse must agree to the rejection in writing and your signatures witnessed by a notary public. No less than 30 days before your Annuity Starting Date, you will receive a written explanation of the terms and conditions of the joint and survivor annuity and the effect of the rejection of such annuity. (You may waive the 30-day period if your annuity begins more than 7 days after the 11

12 written explanation has been provided.) You and your spouse may reject the joint and survivor annuity or revoke a previous rejection at any time not more than 90 days and not less than 30 days before your retirement effective date. If you are not legally married or your spouse cannot be located, you must provide satisfactory evidence of such fact to enable the Fund to pay your account balance in any other form. 15. Q. What happens if I withdraw the money in my Individual Account and then start working again? A. A new Individual Account will be established for you when you again satisfy the requirements for participation as discussed in Q&A 1. D. DESIGNATION OF BENEFICARY AND ASSIGNMENT OF BENEFITS 16. Q. How do I designate a beneficiary for my Accumulated Share? A. You may designate a beneficiary on a form provided by the Board of Trustees and received by the Fund before your death. You may change your beneficiary at any time in the same manner. If you are legally married and wish to designate someone other than your spouse as your primary beneficiary, you must obtain written spousal consent that is witnessed by a notary public. 17. Q. What happens if I do not designate a beneficiary or if my designated beneficiary dies? A. If a beneficiary is not named, or should your designated beneficiary die before receiving benefits under the Plan, payment of your Individual Account will be made to any person who is an object of your natural bounty or your estate, as the Board of Trustees may designate. IMPORTANT It is your responsibility to have an up-to-date beneficiary designation form on file with the Fund Office. If you are not sure whether you have an up-to-date beneficiary designation form on file, or you wish to change your designated beneficiary, you can obtain the required form by writing or telephoning the Fund Office. 12

13 18. Q. May I assign my Individual Account or any other right or benefit under the Plan? A. Neither you nor any beneficiary can assign any account, right or benefit under the Plan. However, your benefits will be subject to the Internal Revenue Service provisions for garnishment of Individual Accounts for income tax purposes under the IRS code and also subject to Qualified Domestic Relations Orders pursuant to a State Domestic Relations Law. 19. Q. What is a Qualified Domestic Relations Order? E. TAXES A. A Qualified Domestic Relations Order (QDRO) is a judgment, decree or order pursuant to state law relating to child support, alimony, or marital property rights directing that all or part of a participant s benefit be paid to an alternate payee. The order must be delivered to the Plan before payments can be made to an alternate payee, and the Plan must approve its form. (1) The order must specify: The names and last known mailing addresses of the participant and each alternate payee covered by the order; The amount or formula for determining the amount payable to each alternate payee; The number of payments or period of time to which the order applies; and The name of the plan to which the order applies. (2) The order cannot require the Plan to: Provide any type or form of benefit, or any option, not otherwise provided under the Plan; Provide increased benefits determined on the basis of actuarial value; or Pay benefits in conflict with a previously issued qualified domestic relations order. 20. Q. Do I have to pay tax on the money in my Individual Account? A. The amount credited to your Individual Account is not considered taxable income to you until you actually receive the money. When you are paid the 13

14 money in your Individual Account, it then must be reported as taxable income, unless you elect to rollover the entire distribution into an Individual Retirement Account (IRA). Since you may owe taxes on the money you withdraw, the federal government requires that if you are receiving certain types of benefits from the Plan, 20% must be withheld for income tax purposes. These types of benefits are: a lump sum payment, installment payments over a period of less than ten years, or certain death benefit payouts. However, these types of benefits are eligible for a rollover into an IRA or other-tax-exempt retirement plan willing to accept the distribution. (The distribution of a surviving spouse may not be rolled over into a tax-exempt retirement plan willing to accept the distribution.) If you roll over your benefits, and meet the requirements of the Internal Revenue Code, withholding is not mandatory. You will be given complete information when you apply for benefits and the opportunity to elect or reject rollover treatment if your benefit is subject to the 20% mandatory withholding. In addition to regular Federal income tax, if you elect to receive payment of your Individual Account prior to age 59½, you may also be subject to an additional tax penalty for early distribution. Refer to the section entitled NOTICE OF EARLY DISTRIBUTION PENALTY on page for additional information. IMPORTANT When you terminate your account, you could be dealing with substantial amounts of money. It is, therefore, very important that you discuss with a competent tax advisor the manner in which you should take the money out of your Individual Account. Serious tax consequences could result from the way that these payments are made to you. The Fund Office cannot advise you of the consequences as they apply to your specific circumstances. F. APPLICATION AND APPEAL PROCEDURES 21. Q. What is the application procedure for payment of my Accumulated Share? A. All applications must be in writing and filed with the Fund Office in a manner prescribed by the Board at least 30 days before payment of your Accumulated Share is to be made. 22. Q. What if I fail to apply for payment of my Accumulated Share? A. If an application for payment of your Accumulated Share has not been filed within three months from the date of your retirement for the Plan, the Board will 14

15 deposit the sum in a savings account insured by an instrumentality of the U.S. Government. If, after depositing the sum into a savings account, the Board is unable to locate you within five years, your Accumulated Share will be used to defray the non-investment expenses of the Fund. However, it is your right to claim such sum at a later date. 23. Q. What is the procedure to follow if an applicant is denied? A. A Participant who has received a notice that his application for benefit payment has been denied may request a review by the Board of the denied claim within 60 days of the date of notice of denial. It is your right to request a hearing and, upon good cause shown, the Board may grant a hearing on the petition before a hearing panel. The Board shall render a decision within 60 days after the request is received unless special circumstances, such as a hearing before the panel, require an extension of such time limit. If the limit is extended, the decision will be rendered within 120 days after the request is received by the Board. You will be advised in writing of the Board s decision. The Board s decision will be final subject to such judicial review as is provided by law. See Section 5.03 of the Annuity Plan for further details concerning the appeal procedures. G. AVAILABILITY OF PLAN DOCUMENTS 24. Q. Are Plan documents available to Participants and Beneficiaries? A. Yes. Copies of the Trust Agreement, Annuity Plan, and any Plan amendments, statements of assets and liabilities and income and expenses of the Plan, and a summary of the Plan, and a summary of the annual report are available at the Fund Office during regular business hours and upon written request, will be furnished by mail. In addition, copies of the Collective Bargaining Agreements and a full annual report (Form 5500) are available for inspection at the Fund Office during regular business hours and, upon written request, will be furnished by mail upon payment of reasonable charges. You should therefore find out what that charge will be before writing and asking for copies of these documents. The Plan Trust Agreement provides that the Individual Employers shall not be required to make any further payments or contributions to the cost of the operation of the Fund or of the Plan, except as may be provided in the Collective Bargaining Agreements, Subscribers Agreements, and Trust Agreement. 15

16 NOTICE OF EARLY DISTRIBUTION PENALTY The law known as the Tax Reform Act of 1986 places a 10% penalty upon early distributions from the Annuity Plan, effective January 1, This tax is in addition to any income tax due. Unless a Participant meets the requirements of the exceptions shown below, any lump sum payment of his Accumulated Share following a separation from service that occurs before the Participant reaches 59½ shall be subject to this additional tax. The following distributions made prior to age 59½ are exempt from the early distribution penalty. (1) Payment in the form of a life annuity (including a joint and survivor annuity) following separation from service; (2) Payment to a Participant who is at least age 55 made in accordance with the Plan s early retirement provisions; (3) Payment made due to a Participant s death or disability, or to an alternate payee as decreed by a qualified domestic relations order; or (4) Payment made to a Participant used to pay medical expenses otherwise deductible under Internal Revenue Code Section 213. In order to determine if this change applies to you, it is best to seek the advice of a tax professional. If you have questions about this information in general, you may contact the Fund Office for assistance. INFORMATION REQUIRED BY THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF NAME OF PLAN Bay Area Painters and Tapers Annuity Plan 2. TYPE OF PLAN The Plan is a defined contribution plan within the meaning of ERISA which is not a plan covered by the plan termination insurance provisions of that Act. Accordingly, the benefits of the Plan are not insured under Title lv of the Act. This Plan provides retirement and termination benefits to eligible employees. 3. Benefits are provided directly from the Fund s assets that are accumulated under the Trust Agreement. 4. PLAN ADMINISTRATOR The Plan is administered by the Joint Board of Trustees. Its name, address (which is the official Administrative Office), telephone number, Employer Number (EIN) and Plan Number are as follows: 16

17 Name: Board of Trustees of the Bay Area Painters and Tapers Annuity Plan Address and Telephone Number: One Lawrence Avenue, San Francisco, CA (415) EIN: Plan Number: The names and addresses of the members of the Board of Trustees are listed below: Union Hayden Blaylock c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Tommy Caster c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. William Cummings, Chairman c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Fred Inman c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Gene Massey c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Management Mr. David Ayala, Secretary c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Ronald J. Becht c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Tom Daniels c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Charles Del Monte c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Jason W. Fell c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California

18 Union Mr. Les Proteau c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Management Mr. Len Fregosi c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. John Lawrence c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Ray Monks c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California Mr. Buck Smith c/o Bay Area Painters and Tapers Annuity Fund One Lawrence Avenue San Francisco, California The name and address of the person designated as agent for service of legal process is:, Administrator Bay Area Painters and Tapers Trust Funds One Lawrence Avenue San Francisco, California COLLECTIVE BARGAINING AGREEMENTS The Plan is maintained in accordance with Collective Bargaining Agreements between various employers and District Council No. 16 of the International Union of Painters and Allied Trades. The Collective Bargaining Agreements provide for contributions by the employers to the Trust Fund on an agreed-upon-cent-per-hour basis. There are no employee contributions. The Fund Office will provide any Plan Participant or Beneficiary, upon written request information as to whether a particular employer is contributing to this Fund with respect to the work of the Participants in the Fund and, if the employer is a contributor, the employer s address. 8. FISCAL YEAR The Fiscal Year of the Fund is the twelve-month period ending each December The Plan s requirements with respect to eligibility for participation and benefits are shown in Articles 2 and 4 of the Annuity Plan. 18

19 10. The Board may amend, modify or terminate the Plan pursuant to its authority under Article 5 of the Plan. No amendment or modification may reduce any benefits that have been approved for payment prior to such amendment, so long as sufficient funds are available to provide such benefits. Upon termination, the assets remaining, after providing for Plan expenses and for the payments of and Accumulated Shares already approved, shall be distributed among the Plan participants. In no event will the termination of the Plan or Trust result in a reversion of any assets to any Individual Employer. STATEMENT OF ERISA RIGHTS As Participants in the Bay Area Painters and Tapers Annuity Plan, you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all Plan Participants shall be entitled to: Receive Information About Your Plan and Benefits Examine, without charge, at the Plan Administrator s office and at other specified locations, such as worksites and union halls, all Plan documents, including collective bargaining agreements and copies of all documents filed by the Plan with the U.S. Department of Labor, such as detailed annual reports and Plan descriptions. Obtain copies of all Plan documents and other Plan information upon written request to the Plan Administrator, who may make a reasonable charge for the copies. Receive a summary of the Plan s annual financial report. The Board of Trustees is required by law to furnish each participant with a copy of this summary annual report. Insofar as required by applicable government regulation you may also obtain a statement telling you whether you have a right to receive an annuity at Normal Retirement Age if you stop working under the Plan now. If you do not have a right to an annuity, the statement will tell you how many more covered hours you have to work to get a right to an annuity. This statement must be requested in writing and is given only once a year. The Plan must provide the statement free of charge. Prudent Actions by Plan Fiduciaries In addition to creating right for Plan Participants, ERISA imposes duties upon the people who are responsible for the operation of this Plan. The people who operate your Plan called fiduciaries of the Plan, have a duty to do so prudently and in the interest of you and other Plan Participants and beneficiaries. No one, including your employer, your union, or any other person may fire you or otherwise discriminate against you in any way to prevent you from obtaining an annuity benefit or exercising your rights under ERISA. If your claim for benefits is denied in whole or in part, you must receive a written explanation of the reason for the denial. You have the right to have the Plan review and reconsider your claim as described elsewhere in this booklet. 19

20 Enforce Your Rights If your claim for a benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules. Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of Plan documents or the latest annual report from the Plan and do not receive them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Administrator. If you have a claim for benefits that is denied or ignored, in whole or in part, you may file suit in a state or Federal court. In addition, if you disagree with the Plan s decision of lack thereof concerning the qualified status of a domestic relations order or a medical child support order, you may file suit in Federal court. If it should happen that Plan fiduciaries misuse the Plan s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous Assistance With Your Questions If you have any questions about your Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the Plan Administrator, you should contact the nearest office of the Pension and Welfare Benefits Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Pension and Welfare Benefits Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Pension and Welfare Benefits Administration. 20

21 RULES AND REGULATIONS OF THE BAY AREA PAINTERS AND TAPERS ANNUITY PLAN 21

22 BAY AREA PAINTERS AND TAPERS ANNUITY PLAN RULES AND REGULATIONS Third Revision Effective January 1, 2001 TABLE OF CONTENTS Page ARTICLE 1. DEFINITIONS ARTICLE 2. PARTICIPATION ARTICLE 3. INDIVIDUAL ACCOUNTS ARTICLE 4. BENEFITS AND ELIGIBILITY ARTICLE 5. GENERAL PROVISIONS

23 BAY AREA PAINTERS AND TAPERS ANNUITY PLAN RULES AND REGULATIONS Third Revision Effective January 1, 2001 This document sets forth the Rules and Regulations of the Pension Plan as amended effective January 1, 2001, and constitutes an amendment, restatement and continuation of the Plan. This revised Pension Plan is intended to comply with the Employee Retirement Income Security Act of 1974 and with the requirements for tax qualification under the Internal Revenue Code and all regulations there under, and is to be interpreted and applied consistent with that intent. ARTICLE 1. DEFINITIONS (As used herein) Unless the context of subject matter otherwise requires, the following definitions shall govern the Plan: Section Accumulated Share means the amount payable from an Individual Account as defined and described in Section Section Annuitant means an Employee who Retirees and who receives a benefit from the Plan. Section Annuity Plan or Plan means the Bay Area Painters and Tapers Annuity Plan established pursuant to the Collective Bargaining Agreements and the Trust Agreement and any modification, amendment, or extension of said Plan. Section Annuity Starting Date for a Participant means the first day of the first calendar month starting after the Participant has fulfilled all of the conditions for benefits including the filing of an application. Section Association means the Chapters of the Painting and Decorating Contractors Association or the Northern California Drywall Contractors Association, which are parties signatory to the Trust Agreement. Section Beneficiary means a person designated by a Participant pursuant to the Plan or by the terms of the Plan who is or who may become entitled to a benefit under the terms of the Plan. Section Board of Trustees or Trustees means the Board of Trustees established by the Trust Agreement. 23

24 Section Collective Bargaining Agreement means any contract by and between the Association, or any Employer, and any Local Union or District Council, including any and all extensions, amendments or renewals thereof. Section Contribution means the payment made or required to be made to the Annuity Plan by an Employer as determined from time to time by the Board of Trustees. Contributions shall also include: a. Any supplemental payments made or required to be made to the Annuity Plan by an Employer under the provisions of a Collective Bargaining Agreement or as allowed under Section 1.3 of the Trust Agreement. b. Contributions owed for period of Qualified Military Service in the armed forces of the United States consistent with and to the extent required by the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended (USERRA), and Section 414(u) of the Internal Revenue Code, as amended. Contributions owed to the Individual Account of any Participant for a period of Qualified Military Service shall come from investment income or forfeitures, if any, before coming from the Participant s last employer prior to the period of Qualified Military Service. A Participant who have reemployment rights under USERRA shall be credited with hours worked equal to the average amount of hours earned by the Participant during the 12-month period of employment immediately prior to the period of Qualified Military Service (or, if shorter, the period of employment immediately preceding such period). The hourly Contribution rate shall be the average of Contributions for all Participants during the Plan Year in which the Qualified Military Service was performed. Section Covered Employment means work as an Employee as defined in Section Continuous Non-Covered Employment means employment for a Contributing Employer in a job not covered by this Plan which is continuous with a Participant s Covered Employment with the same Contributing Employer. A period of Non-Covered Employment will be considered to be continuous with Covered Employment only if there is no termination of employment between the periods of Covered and Non-Covered Employment. Section District Council means any District Council affiliated with the International Brotherhood of Painters and Allied Trades and which is signatory to the Trust Agreement. Section Employee means (a) any person who performs work covered by a Collective Bargaining Agreement between the District Council or Local Union and the Association or other employers, and for whom the Employer is obligated to make Contributions to the Annuity Plan and any person who has previously performed work covered by a Collective Bargaining Agreement between an Employer and a Local Union or District Council and who satisfies the requirements adopted by the Trustees; (b) any full-time salaried officer or representative of a District Council or Local Union which extends pension coverage to such officers or representatives pursuant to regulations adopted by the Trustees; (c) any employee of the Board of Trustees who, pursuant to resolution of the Board of Trustees, is included under the Annuity Plan; (d) any other persons who, pursuant to resolution of the Board of Trustees, are included 24

25 under the Annuity Plan. The term Employee does not include any self-employed person, whether a sole proprietor or a partner. Solely for purposes of testing for compliance with the nondiscrimination regulations under Section 401(a)(4) of the Internal Revenue Code, all leased employees as defined in Code 414(n) or 414(o) who have performed services for a Contributing Employer on a substantially full-time basis for a period of at least one year shall be treated as employed by a Contributing Employer except to the extent such leased employees are excluded in accordance with Code Section 414(n)(5). Section Employer or Contributing Employer means any corporation, individual or partnership which has presently in force, or hereafter executes, or is a member of a chapter of the Association or is a member of any employer association, which has executed on its behalf, or is otherwise bound by, a Collective Bargaining Agreement with a Local Union or District Council, which Agreement provides for Contributions into the Annuity Plan, and shall also include any employer who may be authorized by the Trustees to make payments into the Annuity Plan on behalf of particular employees, and any District Council or Local Union which extends pension coverage to its full-time salaried officers and representatives pursuant to regulations adopted by the Board of Trustees, and also the Board of Trustees. An employer shall not be deemed a Contributing Employer simply because it is part of a controlled group of corporations (within the meaning of 1563(a) of the Internal Revenue Code, determined without regard to 1563(a)(4) and (e)(3)(c), or of a trade or business under common control (within the meaning of 414(c) of the Internal Revenue Code), some other part of which is a Contributing Employer. Section ERISA means the Employee Retirement Income Security Act of 1974 as amended and any regulations issued pursuant thereto. Section Fiscal Year means January 1 to December 31 of any one year. Section Fund means the Bay Area Painters and Tapers Pension Trust Fund and shall include all Contributions - designated for the Bay Area Painters and Tapers Annuity Plan - to the Fund created under the Trust Agreement received by the Trustees under the said Collective Bargaining Agreements and any additional Contributions thereto that may hereafter be agreed upon by the parties under these said Collective Bargaining Agreements, or other collective bargaining agreements between the parties, or any modification, amendment, revision or extension thereof, together with all income, increments, earnings and profits therefrom, and all other funds (as defined in the Trust Agreement) received by the Trustees for the uses, purposes and trusts set forth in the Trust Agreement. Section Highly Compensated Employee means each highly compensated active employee and highly compensated former employee of a Contributing Employer. Whether an individual is a highly compensated employee is determined separately with respect to each Contributing Employer, based solely on that individual s compensation from or status with respect to that Contributing Employer. A highly compensated active employee is an employee of the Contributing Employer who performs service for the Contributing Employer during the determination year and who: 25

26 a. During the look-back year received compensation from the Contributing Employer in excess of $80,000 (as adjusted under Section 414(q) of the Internal Revenue Code) and was one of the top 20 percent (20%) of the employees of the Contributing Employer during the look-back year when ranked on the basis of the compensation during that year. b. Is a five percent (5%) owner at any time during the look-back year or the determination year. c. The determination year is the Plan Year for which the test is being applied, and the look-back year is the 12-month period immediately preceding that Plan Year. A highly compensated former employee is an employee who was a Highly Compensated Employee when he or she separated from service or was a Highly Compensated Employee at any time after attaining age 55. The determination of who is Highly Compensated Employee will be made in accordance with Section 414(q) of the Internal Revenue Code and the regulations thereunder. Section Hours of Work means hours for which an Employee, as defined in Section 1.12, is paid, or entitled to payment, for the performance of duties for a Contributing Employer. Hours of Work shall also include hours for which back pay, irrespective of mitigation of damages, is awarded or agreed to by an Employer, to the extent that such award or agreement is intended to compensate an Employee for periods during which the Employee would have been engaged in the performance of duties for the Employer. Section Individual Account means the account established for each Participant pursuant to Section 3.01 of the Plan. Section Local Union means any local union affiliated with District Council Nos. 8 or 16 of the International Brotherhood of Painters and Allied Trades, which local union is a party to a Collective Bargaining Agreement requiring Contributions to the Annuity Plan. Section Non-Bargained Employee means an Employee whose participation in the Annuity Plan is not covered by a Collective Bargaining Agreement. Section Participant means any Employee who meets the requirements of Article 2 for participation in the Annuity Plan. Section Plan means the rules and regulations set forth herein. Section Qualified Domestic Relations Order means a domestic relations order which has been determined, pursuant to procedures established by the Board of Trustees, to be a qualified domestic relations order as defined in 206(d) of ERISA. Section Qualified Military Service. Notwithstanding any provision in the Plan to the contrary, a Participant s benefits shall include Contributions (but not investment income or forfeitures) owed for periods of Qualified Military Service in the armed forces of the United States consistent with and to the extent required by the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended (USERRA), and Section 414(u) of the Internal Revenue Code, as amended. 26

27 Qualified Military Service will be counted for purposes of crediting a Participant s Individual Account with Contributions provided the following conditions are satisfied: a. Participant must have reemployment rights under USERRA in order for his period of Qualified Military Service to be recognized. b. The Participant must be an active Participant in the Plan. c. After discharge from Qualified Military Service, the Participant must return to work within the time frame required by USERRA. d. No more than five years of Qualified Military Service may be recognized for any purpose, except as required by law. Section Required Beginning Date means the April 1 following the calendar year in which the Participant attains age 70½ or, if later, retires. Effective January 1, 1989, Required Beginning Date means the April 1 following the calendar year in which the Participant attains age 70½, regardless of whether the Participant Retires. Section Retires or Retired means the complete withdrawal by a Participant from employment for wages or profit as a painter or taper in the geographic area covered by the Annuity Plan. The date of retirement shall be deemed to be (a) the first day on the month following the sixth consecutive month for which Contributions cease to be required on the Participant s behalf, or (b) the effective date of pension payments from the Bay Area Painters and Tapers Pension Plan or (c) the date of commencement of primary Social Security Benefits, whichever is the earliest date. Section Spouse means a person to whom a Participant or Annuitant is legally married. Section Trust Agreement means the Trust Agreement dated January 1, 1960, establishing the Bay Area Painters Pension Trust Fund and any modification, amendment, extension or renewal thereof. Section Valuation Date means the last business day of each Fiscal Year. 27

28 ARTICLE 2. PARTICIPATION Section Purpose. This Article contains definitions to meet certain requirements of the Employee Retirement Income Security Act of 1974 (otherwise referred to as ERISA). Once an Employee has become a Participant, an Individual Account is established for him to which Contributions made with respect to his work are credited in accordance with the provisions of Article 3. Section Participation. An Employee who works in Covered Employment shall become a Participant in the Plan at such time as he completes his first Hour of Work. Section Termination of Participation. A Participant who receives payment of his Accumulated Share or has an annuity purchased for him shall cease to be a Participant as of the date on which the Accumulated Share is paid to him or an annuity is purchased for him in accordance with the provisions of Article 4. A Participant shall also cease to be a Participant when there is no payment to be made to him because there is no balance remaining in his Individual Account after the assessment of the administrative charge. Section Reinstatement of Participation. An Employee who has lost his status as a Participant in accordance with Section 2.03 shall again become a Participant at such time as he satisfies the requirements of Section