Rules Basic Pension Fund Stand: 01.01.2015 Für Ihre soziale Sicherheit
Rules l Sulzer Pension Plan Table of contents I Trust, purpose of the pension plan Article 1 Trust 2 Terms of acceptance 3 Ability to work 4 External insured persons / insurance on leave 5 Termination of insurance 6 Relevant annual salary/insured salary 7 Retirement capital/retirement credits II Income Article 8 Premiums 9 Transferable retirement capital / voluntary purchases III Benefits of the pension plan Article 10 Insured benefits 11 Retirement pension / capital sum payable on retirement 12 Bridging pension 13 Retirement at the request of the company 14 Retirement children s pension 15 Disability 16 Disabled person s children s pension 17 Spouse s pension 18 Benefits in case of a live-in relationship similar to marriage 19 Orphan's pension 20 Capital sum payable on death 21 Withdrawal benefit 22 Utilization of the withdrawal benefit IV Special conditions Article 23 Conditions of payment 24 Allowance for third-party benefits 25 Claims against liable third parties 26 Set-off claims 27 Guaranteeing pension benefit 28 Information to the insured 29 Duty to provide information and report 30 Advance withdrawal, pledge, duty to provide information 31 Divorce
Rules l Sulzer Pension Plan V Assets of the pension plan Article 32 Assets / liabilities 33 Benefit improvement 34 Company's premium reserve VI Organization Article 35 Executive bodies of the trust 36 Board of trustees 37 Deputies 38 Duties of the board of trustees 39 Adoption of resolutions 40 Auditing / shortfall in cover 41 Accounting; investment of assets VII Concluding and transitional conditions Article 42 Application, amendment of the rules 43 Termination of affiliation contracts, liquidation of the trust 44 Disputes 45 Transitional conditions 46 Effective date Enclosure: Applicable amounts Appendix 1: Tables Appendix 2a: Support contract Appendix 2b: Beneficiaries to capital sum payable on death Appendix 3: Maximum potential retirement capital Appendix 4: Additional conditions for external membership 1.1.2015 1
Terms Employees Insured persons Company Persons employed by the company. Employees accepted into the pension plan. Sulzer AG and those companies which have entered into an affiliation contract (with the consent of the employees or any employee representative body) with the pension plan. Pension plan The trust for provision of pension benefits ("Sulzer Vorsorgeeinrichtung" SVE). AHV/IV BVG Swiss retirement and surviving dependants social security insurance (AHV) and Swiss disability insurance. Federal law covering occupational retirement, surviving dependants and disability provision. BVV 2 Ordinance on occupational retirement, survivors' and disability pension plans. UVG Registered partnership Federal law covering accident insurance. A registered partnership in accordance with the Swiss partnership law (PartG). The regulations applicable to the spouse (incl. requirement of signature in cases of lump sum benefit payment, asset withdrawal, pledging, cash payment and divorce) apply correspondingly to registered partners in accordance with the partnership law. Regular retirement age Age on the first day of the month following the insured's 65th birthday. Where masculine or feminine forms are used below for persons, these shall apply to both men and women. The German language version of the rules is binding. 2
Rules l Sulzer Pension Plan I Trust, purpose of the pension plan Article 1 Trust 1 A trust exists under the name "Sulzer Vorsorgeeinrichtung" (Sulzer Pension Plan) within the meaning of Article 80 et seq. of the Swiss Civil Code, Article 331 et seq. of the Swiss Code of Obligations and Article 48 et seq. of the federal law covering occupational retirement, surviving dependents and disability insurance (BVG). The trust's principal place business is Winterthur. 2 The purpose of the pension plan is to provide pension benefits for the employees of its affiliated company after retirement and in the event of disability and for their surviving dependants after their death. It will maintain the obligatory occupational retirement, surviving dependants and disability pension funds in accordance with the BVG, and is registered for this purpose in the occupational pension register. 3 The pension plan will maintain the providential fund in accordance with the terms of these rules on its own account and at its own risk. 4 The pension plan will in each case guarantee at least the benefits in accordance with the BVG. For this purpose it will provide a statement for each insured person indicating the retirement capital and the minimum benefits in accordance with the BVG. 5 The pension plan will be managed by a board of trustees. Article 2 Terms of acceptance 1 Those employees of the company shall be accepted into the pension plan a) who have reached the age of 17, and b) whose annual salary (Art. 6 par. 2) exceeds the minimum salary under Art. 2 BVG (see enclosure). The provisions of par. 2 remain reserved. Enrolment takes place when the employment relationship begins, but not before January 1 following the 17th birthday for cover against the risks of death and disability and January 1 following the 24th birthday for retirement cover. 2 The following persons are not enrolled with the pension plan: a) Employees who have passed the age of 65; b) Employees who already have mandatory insurance cover elsewhere for their principal position of employment or who are primarily self-employed; c) Employees who are at least 70% disabled as defined by the disability insurance (IV); d) Employees with a fixed-term employment contract of up to three months. If the fixed-term employment contract is extended past three months, the obligation to provide insurance cover commences on the date on which the extension of the contract was agreed; e) Employees who are not employed in Switzerland or who are unlikely to be 3
employed in Switzerland on a permanent basis and who are adequately insured outside Switzerland, provided that they request to be exempted from enrolment in the pension plan. The pension plan does not insure salary components which employees earn with other companies (Art. 46 par. 2 BVG). 3 Provided that they comply with the terms of acceptance into the pension plan, trainees, part-time workers, and also employees who are employed only as casual staff or on a temporary basis are also included among the employees eligible for insurance, except where their contract of employment is limited in advance to a maximum of three months. 4 Employees rejoining the company will be treated in the same way as new staff. Article 3 Ability to work 1 If an insured person is fully able to work on joining the pension plan, he will be entitled to benefits under these rules. 2 If an insured person is not fully able to work before or on joining the pension plan but has not been declared disabled as defined by the BVG, and the cause of the inability to work fully leads to disability or death within the period defined by the BVG, he will not be entitled to benefits under these rules. If the insured person was insured with another pension scheme at the time the inability to work commenced, this pension scheme is liable to pay benefits. Article 4 External insured persons/insurance on leave 1 Insured persons whose employment with the company is terminated may continue to be insured as external insured persons. The board of trustees will lay down additional conditions (appendix 4). 2 With the consent of the company, insured persons who are employed by an affiliated company outside the EU/EFTA area and who pay voluntary AHV contributions under Art. 2 AHVG (federal social security law) can continue to be insured. 3 Insured persons who have been granted leave by the company for not more than two years may remain in the pension plan. The insurance will be maintained and the insured benefits will be determined on the basis of the accrued retirement capital and any contributions which continue to be paid. Article 5 Termination of insurance 1 If the employment of an insured person is terminated other than by retirement, disability or death, this will result in withdrawal from the pension plan; the terms of Article 4 apply. The leaving insured person may claim withdrawal benefit in 4
Rules l Sulzer Pension Plan accordance with Article 21. 2 The insured person will continue to be insured against disability and death until the commencement of a new employment, but for no longer than one month after the termination of the previous employment. If the withdrawal benefit has already been paid out, it may be set off against disability or surviving dependants benefits falling due for payment. 3 If the pension plan must pay survivors' or disability benefits after the withdrawal benefits have already been paid out, the withdrawal benefits required to finance the survivors' or disability benefits must be repaid to the pension plan. If this amount is not repaid, the pension plan will reduce the survivors' and disability benefits. Article 6 Relevant annual salary/insured salary 1 The insured salary equals the relevant annual salary pursuant to par. 2 minus the coordination offset pursuant to par. 3. The maximum insured salary and the maximum coordination offset are revised and fixed annually by the board of trustees (see enclosure). 2 The relevant annual salary in the sense of these rules is based on the salary system in use by the affiliated companies; the salary includes the annual salary (usually 13 monthly salaries). The flexible salary components (bonus, variable salary component, allowance for shift work) earned during the past 12 months and notified to the pension plan by the affiliated companies can also be insured. Family and children's allowances as well as other parts of the salary which are only payable occasionally or temporarily will not be taken into account. Shares of salary which are earned with other employers are excluded. Losses in salary due to illness, accident, military service, or short-time working are not deducted. 3 The co-ordination offset amount is equivalent to 40% of the relevant salary, but in any case will not exceed the maximum fixed by the board of trustees (see enclosure). 4 The insured salary will be fixed initially when an employee is accepted into the pension plan. Later adjustments are based on the salary system applied by the company in accordance with the affiliation contract. Par. 5, 6 and 8 remain reserved. 5 If the employment level of an insured person is reduced, the insured salary will be recalculated. If the insured salary falls below the minimum salary pursuant to Art. 2 BVG, the insured person cannot continue to be insured and must leave the pension plan. At the written request of the company, the previous annual salary can continue to be insured for up to two years. The company organizes collection of the premium. 6 Insured persons aged between 58 and 65 whose annual salary is reduced by up to 50% can continue to insure their previous relevant annual salary. The employer organizes collection of the premium. 7 The insured salary which is relevant for the determination of the disability pension (or survivors pensions for active insured) corresponds to the average of 5
the insured salaries on which contributions were collected in the three years before occurrence of the insured event. 8 For partly disabled insured, the maximum insured salary and maximum coordination offset are reduced to correspond to the entitlement to a disability pension (Art. 15). Article 7 Retirement capital/retirement credits 1 An individual retirement account is kept for each insured which reflects their retirement capital. The retirement capital consists of: a) the retirement credits plus interest; b) the withdrawal benefits brought into the pension plan, plus interest; c) any voluntary purchases of additional benefits, plus interest; d) all other deposits plus interest, minus any advance withdrawals to finance residential property or as a result of divorce, plus interest. 2 The retirement accounts of all insured who are at least 25 years old are credited with a retirement credit in accordance with appendix 1 at the end of every calendar year. 3 The following conditions apply to the management of the retirement account: a) The rate of interest is determined by the board of trustees. b) Interest is calculated on the accrued retirement capital at the end of the previous year and is credited to the retirement capital at the end of each calendar year. The retirement credits for the calendar year in question are added to the retirement capital without interest. c) If an insured brings his transferable retirement capital into the pension plan or buys additional retirement benefits, these amounts will earn interest for the calendar year in question from the date of receipt of the payment. d) If an insurance claim arises or an insured leaves the pension plan during the course of a calendar year, the interest for the current calendar year is calculated on the basis of the accrued retirement capital at the end of the previous year and credited pro rata for the period for which he was insured. He also receives a pro rata retirement credit for the period for which he was insured during the calendar year in question. 4 In the event of total disability, the retirement capital continues to earn interest and the insured continues to receive retirement credits. This commences when the claim to a disability pension from the pension plan arises and ends when the disability pension is discontinued. The retirement credits are based on the insured salary at the time the insured became unable to work and the regulatory retirement credits as a percentage of the insured salary. 5 In the event of partial disability, the accrued retirement capital at the time the entitlement to a disability pension from the pension plan arises and the insured salary at the time the inability to work commences will be divided into two parts according to the entitlement to a disability pension. The part of the retirement capital relating to the disability will continue to be managed as for a fully disabled insured in accordance with par. 4, and the part relating to active employment as 6
Rules l Sulzer Pension Plan for an insured who is fully able to work. II Income Article 8 Premiums 1 The contributions to be paid by the company and by the insured are set out in appendix 1. 2 The insured can pay their contributions according to the SVE Basic plan, Comfort plan or Superplan (appendix 1). The choice is made on joining the pension plan. In the absence of any written notification, the SVE Basic plan will apply. The chosen savings plan can be changed annually with effect as of July 1 of a given calendar year. The pension plan must be notified of this in writing by May 31 at the latest using the application form available on the Internet. In the absence of any written notification, the savings plan last selected will remain in force. 3 The insured's contributions are deducted from their salaries in 12 monthly instalments and transferred to the pension plan on a monthly basis. The company's contributions will be transferred to the pension plan together with the insured's contributions or will be debited to the employer contribution reserves, if any. 4 The contributions of the company and the insured under the rules can temporarily be financed in part or in full by another pension plan if the plan in question provides for a corresponding purpose. The beneficiaries are to be informed of the scale and duration of any reductions in contributions. 5 The obligation to pay contributions commences upon enrolment with the pension plan, but not before January 1 following the 17th birthday (Art. 2), and ends, subject to par. 6, when a) the insured reaches the age of 65, b) the employment relationship is terminated, c) the insured earns less than the minimum salary pursuant to Art. 2 BVG (see enclosure). 6 In the event of an accident, illness or military service the insured remains obliged to pay contributions for as long he receives a salary or any salary replacement benefits. The contributions will be deducted from the continued salary or from the salary replacement benefit. 7 The waiver of contributions in the event of disability commences when the claim to a disability pension from the pension plan arises and ends when the disability pension is discontinued. Calculations are based on the insured salary at the time the inability to work begins and the entitlement to a disability pension from the pension plan (see Art. 7 par. 4 and 5). Article 9 Transferable retirement 1 The transferable retirement capital from a previous pension scheme must be transferred to the pension plan on enrolment. The transferable retirement capital 7
capital / voluntary purchases is credited to the insured as retirement capital. 2 The transferable retirement capital is payable on enrolment with the pension plan. 3 The insured must allow the pension plan to inspect the statements regarding the transferable retirement capital issued by the previous pension scheme. 4 The insured must notify the pension plan if he was a member of a vested benefits institution and of the form of insurance cover provided by this institution. The vested benefits institution must transfer the insured's retirement capital to the pension plan when the insured enrols with the pension plan. 5 An insured who is fully able to work may increase his or her retirement capital and the insured benefits by making one or more voluntary purchases. The relevant maximum retirement capital corresponds to the sum of the retirement credits (appendix 3). The maximum purchase amount in any given case is determined by calculating the difference between the maximum permissible retirement capital and the retirement capital accrued at the time of the purchase. The determining age is the insured salary at the time of the purchase. Purchases after age 65 are permitted up to the amount of the target benefit at regular retirement age. The pension plan gives no guarantee that such voluntary contributions will be tax deductible. 6 The company can pay the costs for purchasing additional benefits on behalf of the insured. 7 If repayment of advance withdrawals to finance residential property is no longer possible owing to age limitations, the insured may make voluntary contributions before retirement benefits become due provided that these purchases together with the amounts withdrawn do not lead to retirement benefits in excess of the maximum claimable amount. 8 Persons moving to Switzerland from abroad who have never been members of a pension plan in Switzerland may not, in the first five years of membership of a Swiss pension plan, exceed an annual purchase limit equal to 20% of their insured salary. Once the five years have elapsed, the pension plan will make it possible for insured who have not yet purchased full benefits under the rules to make such a voluntary purchase. III Benefits of the pension plan Article 10 Insured benefits 1 The pension plan provides the following benefits to insured persons or to their surviving dependants under the conditions indicated below: - Retirement pension/retirement capital - Bridging pension - Retirement children s pension 8
Rules l Sulzer Pension Plan - Disability pension - Disabled person s children s pension - Spouse s pension - Benefits in case of a live-in relationship similar to marriage - Orphan s pension - Capital sum payable on death - Withdrawal benefit 2 The insured benefits listed above will be granted subject to the express limitations detailed in Articles 24 to 27. The conditions of payment described in Article 23 also apply. In each case, the minimum benefits (cf. Article 1, par. 4) are guaranteed in accordance with the BVG. In the event of withdrawals of retirement capital (to finance residential property/in the event of divorce/retirement), the BVG retirement capital in the shadow account is reduced proportionally. Article 11 Retirement pension / capital sum payable on retirement 1 Entitlement to retirement benefits commences on termination of the employment and entry into retirement, but not before reaching the age of 58 and on reaching the age of 70 at the latest. The retirement benefits are paid out in the form of a retirement pension. All or part of the retirement capital may be drawn as a lump sum. Where a lump sum is drawn, all benefits are reduced in proportion to the sum drawn. If all the capital is drawn, no further claims may be made against the Pension Plan. Anyone drawing a retirement benefit in accordance with this Article may not apply for a disability pension in accordance with Article 15ff. 2 The retirement pension will be calculated on the basis of the retirement capital available as at the retirement date and the conversion rate in accordance with appendix 1. If any lump sum has been withdrawn, the calculation is based on the remaining retirement capital. 3 The pension plan must be informed of the wish to draw the capital as a lump sum at least three months before the insured leaves the pension plan. If the insured is married, the spouse must approve the lump-sum payment in writing. Management may request official confirmation of the signature and the marital status. If voluntary contributions were made during the last three years leading up to retirement, the resulting benefits may not be taken in the form of a lump sum. The pension plan gives no guarantee that such voluntary contributions will be tax deductible. 4 With the consent of the company, insured aged 58 or over may take partial retirement (at least 30 percent). The preceding provisions apply correspondingly to partial retirement pensions and partial lump-sum retirement benefits or the bridging pension. The proportions of the retirement capital corresponding to the partial retirement are the key criterion for determining the partial retirement pension or the partial lump-sum retirement capital. The maximum amount of the bridging pension is reduced in line with the partial retirement. The percentage of the partial retirement benefit equals the level of retirement. Partial retirement can take place in up to three stages, with the proviso that the level of employment is reduced by at least 30% for at least one year, while still 9
amounting to at least 30%. A lump sum benefit can be taken in up to two stages. 5 If the insured retires before reaching the age of 65, he may voluntarily purchase the retirement pension that would have been payable at the age of 65 in accordance with the insurance certificate. The amount required for this purchase will be calculated in accordance with the pension plan's guidelines. 6 Insured who continue to work beyond ordinary retirement age may take the retirement benefits due under par. 1, or onward may on request continue to pay into their pension until their employment ends. Retirement benefits become due when the insured turns 70 at the latest. A precondition is that the company must allow its employees to maintain their insurance cover. The company and the insured make savings contributions in accordance with appendix 1. Risk contributions are no longer collected. At the end of the deferral period, the retirement pension is calculated on the basis of the retirement capital then in place. If the insured dies before retiring, the spouse's or partner's pension and the orphan's pension pursuant to Art. 17, 18 and 19 will be calculated in the same way as for a recipient of a retirement pension. The basis for this is the retirement pension calculated according to par. 2 at the time of death. Insured who reduce their level of employment may request partial retirement under par. 4. Article 12 Bridging pension A retirement pensioner who has not yet reached the applicable AHV retirement age may claim a bridging pension until he reaches the regular AHV retirement age. The amount of this pension may not exceed the amount of the maximum AHV retirement pension at the time of retirement. The accrued retirement capital will be reduced in accordance with appendix 1. The bridging pension is paid for the agreed period, but only until the death of the recipient. Article 13 Retirement at the request of the company 1 Provided that an insured person leaves the company for operational reasons before reaching the AHV pension age, the amount of his pension will be set in accordance with the binding company regulations. 2 The company must reimburse the pension plan in each case with the requisite additional retirement credit. Article 14 Retirement children s pension For every child who would be eligible for an orphan s pension (Article 19) in the event of his death, each recipient of a retirement pension is entitled to a children s pension for an amount of 20% of the retirement pension drawn. 10
Rules l Sulzer Pension Plan Article 15 Disability 1 An insured is deemed to be disabled if he is classified as a disabled person by the Swiss federal disability insurance (IV). 2 Recognition of disability and the calculation of the entitlement to a disability pension are based on the legally valid decision of the IV. 3 An insured is entitled to a disability pension if he a) is at least 40% disabled and was insured by the pension plan at the time the illness/injury which made him unfit to work was incurred; or b) was at least 20% but not more than 40% disabled as the result of a congenital defect at the time when he started working and was insured for at least 40% at the time that the level of the inability to work, the cause of which led to disability, increased; or c) became disabled while still a minor and was therefore at least 20% but not more than 40% disabled at the time when he started working and was insured for at least 40% at the time that the level of the inability to work, the cause of which led to disability, increased. 4 The insured person is entitled to a a) full disability pension if he is at least 70% disabled; b) 75% disability pension if he is at least 60% disabled; c) 50% disability pension if he is at least 50% disabled; d) 25% disability pension if he is at least 40% disabled. 5 If an insured becomes disabled, the retirement capital is increased for the purpose of calculating the insured benefits. The retirement capital consists of the accrued retirement capital pursuant to Art. 7, calculated as per the date on which contribution payments end, plus a supplement. The disability pension is based on the higher retirement capital and is calculated using the conversion rate given in appendix 1. The retirement capital supplement amounts to 160% of the retirement credits due for the years and months until the insured reaches the age of 65, without interest and calculated from the date on which contribution payments end. The salary on which the calculation of the supplement is based equals the insured salary pursuant to Art. 6 par. 7. 6 The entitlement to a disability pension lapses if the insured's ability to work returns, but not later than the date on which the insured reaches the regular retirement age on which the employment relationship would have ended. On this date the disability pension is replaced by a retirement pension in the same amount. Part or all of the pension may be drawn as a lump sum. The lump sum amounts to twelve times the annual pension reduction. 7 The entitlement to a disability pension is deferred for as long as the company continues to pay a salary or any salary replacement benefits amounting to at least 80% of the lost salary. The benefits pursuant to Art. 23 et seq. BVG remain reserved. 8 If a partially disabled insured leaves the pension plan, he will continue to receive a partial disability pension plus any accompanying children's pensions. 11
He will also receive transferable retirement capital equalling his remaining ability to work pursuant to Art. 21. The survivors' benefits which remain insured are based on the partial disability pension. Article 16 Disabled person s children s pension Persons drawing a disability pension are entitled to a children s pension (Article 19) for each child who would be eligible for an orphan s pension in the event of their death, amounting to 20% of the disability pension drawn. Article 17 Spouse's pension 1 If a married insured person dies before or after retirement, the surviving spouse is entitled to a spouse s pension, provided that when the event insured against occurs he a) is responsible for the maintenance of one or more children, or b) is over the age of 45, and the marriage has lasted for more than five years, or c) draws a pension from the Swiss IV. If the spouse fails to meet any of these preconditions, he is entitled to a lumpsum payment amounting to three times the annual amount of the spouse s pension. 2 The spouse's pension amounts to 60% of the insured or current disability pension at the time of death pursuant to Art. 15. Following the death of a retirement pension recipient, the spouse's pension amounts to 60% or 100% of the current retirement pension, depending on the deferred spouse's pension chosen before the claim to a retirement pension arose. If the surviving spouse is more than 10 years younger than the deceased insured, the spouse s pension is to be reduced by 3% for each complete year exceeding the 10 years age difference. The reduction is curtailed by 1/20 for each complete year of the duration of the marriage. 3 Entitlement to a spouse s pension takes effect in the month following death, but in any case not earlier than after the cessation of the continued salary or replacement salary payment. It lapses at the end of the month in which death occurred, or on remarriage. In the case of remarriage, the spouse receives, as a final payment, a lump-sum payment amounting to three times the annual amount of the spouse s pension 4 Paragraphs 1 to 3 above also apply to surviving, divorced spouses, where the marriage has lasted for at least 10 years. Benefits will, however, be reduced by the amount by which they, together with the benefits from the remaining insurance policies (in particular AHV or IV), exceed the entitlement under the divorce decree (pension or capital sum in lieu of a pension for life). If a court ruled that part of the withdrawal benefit was to be transferred to the pension plan of the divorced spouse, the latter is only entitled to the statutory minimum survivors' benefits in accordance with the BVG. 12
Rules l Sulzer Pension Plan Article 18 Benefits in case of a livein relationship similar to marriage 1 If an unmarried insured can prove that he has lived for at least five continuous years with a live-in partner who is unmarried and who is not related to him, and if the insured supported this partner completely or significantly, the live-in partner has a claim to the same benefits as a surviving spouse, provided the mutual support obligation was agreed in writing by way of the support contract (appendix 2a). This contract must be submitted to the pension plan during the insured s lifetime. After the death of the insured, the live-in partner must assert his claim to a partner s pension by submitting the required documents. The pension plan reviews the entitlement to benefits on the basis of the prevailing circumstances. If the surviving live-in partner is more than 10 years younger than the deceased insured, the live-in partner s pension is to be reduced, in analogous application of Art. 17 par. 2, by 3% for each complete year exceeding the 10 years age difference. The reduction is curtailed by 1/20 for each complete year of the duration of the live-in partnership. 2 In addition to the conditions under paragraph 1 above, at the time of occurrence of the insured event the surviving live-in partner must satisfy one of the following three conditions: a) He is responsible for the maintenance of one or more children, or b) He is over the age of 45 at the time of death of the insured, or c) He draws a pension from the Swiss IV. 3 If the live-in partner satisfies the requirements under paragraph 1 but not those under paragraph 2, he is entitled to a lump-sum payment amounting to three times the annual amount of the live-in partner s pension. 4 If the surviving live-in partner is already drawing a spouse s or live-in partner s 2nd pillar pension, he loses his entitlement to an additional live-in partner's pension and a lump-sum payment. Article 19 Orphan's pension 1 If an insured person dies before or after his retirement, each of his children under the age of 18 receives an orphan s pension. Children who are still in school or in training, or who as a result of physical or mental infirmity are not gainfully employed, or employed at a reduced level, are entitled to a pension until they reach the age of 25 - provided that the AHV has extended the period of entitlement to benefit by an equal time. 2 Foster children within the meaning of Art. 49 of the ordinance to the federal law covering occupational retirement, surviving dependants and disability insurance and stepchildren are only entitled to orphan s pensions if the insured was responsible for their maintenance. 3 The orphan's pension amounts to 20% of the insured or current disability pension or the current retirement pension pursuant to Art. 15 for children who have lost one parent and 30% for children who have lost both parents. 4 Entitlement to an orphan's pension begins during the month following the death, but only after salary payments or salary replacement benefits have been 13
discontinued. Article 20 Capital sum payable on death 1 If an insured or a recipient of a retirement or disability pension dies, the survivors mentioned below will receive a one-off lump sum death benefit amounting to 150% of the insured or current disability pension pursuant to Art. 15. Once the insured has started drawing a retirement or disability pension, the insured capital sum payable on death will decrease by 1/20 per month until the figure reaches zero. 2 The eligible persons are independent of the law of succession and in the following order: a) the surviving spouse, or if there is no surviving spouse, those children of the deceased insured person who are entitled to an orphan's pension; b) if there are no beneficiaries under a) above, persons who were sup- ported by the insured to a considerable extent or the person with whom the insured lived together without interruption for the last five years before his death or who is responsible for the maintenance of one or more joint children, provided that they do not receive a widower s or widow s pension (Art. 20a par. 2 BVG); in the absence of the aforementioned, c) the other children, parents or siblings of the deceased. The persons mentioned in b) are only entitled to benefits if they were registered with the pension plan in writing during the lifetime of the insured. 3 The insured can change the beneficiary groups as per par. 2 above as follows at any time by submitting a written request to the pension plan: - the beneficiaries under a) and b) can be grouped together, provided that there are beneficiaries under par. 2 b); - the beneficiaries under a) and c) can be grouped together, provided that there are no beneficiaries under par. b). The notification must be submitted to the pension plan during the lifetime of the insured (appendix 2b). The pension plan reviews the entitlement to benefits on the basis of the prevailing circumstances. 4 The insured may determine the claims of the beneficiaries within a beneficiary group (par. 2 and 3) at his own discretion by submitting a written declaration to the pension plan. The notification must be submitted to the pension plan during the lifetime of the insured. If no such notification is submitted, all beneficiaries within a beneficiary group will be entitled to equal shares of the capital sum payable on death. If there are no beneficiaries under Art. 20, the capital sum payable on death is forfeited. 14
Rules l Sulzer Pension Plan Article 21 Withdrawal benefit 1 If the employment is terminated by the insured person or by the company before an insured event has occurred, the insured is entitled to a withdrawal benefit. 2 The withdrawal benefit corresponds to the accumulated retirement capital in the pension plan (Art. 7),.but at least the minimum amount according to Art. 17 FZG. 3 If a company has fully or partially assumed the voluntary contribution, the corresponding amount is deducted from the withdrawal benefit. The deduction is reduced by any agreement made, however by at least one-tenth of the amount assumed for each full contributory year. Any unused part will be credited to the premium reserve account of this company. Article 22 Utilization of the withdrawal benefit 1 If the insured joins a new pension scheme, the pension plan will transfer the withdrawal benefits to the new pension scheme. 2 Insured who are not joining a new pension scheme must inform the pension plan whether the withdrawal benefits will be used to open a vested benefits account or to purchase a vested benefits policy. If the pension plan receives no such notification, the withdrawal benefits plus interest will be transferred to the National Substitute Pension Plan at the earliest six months but not later than two years after the departure benefits fell due. 3 The insured person may request payment of the withdrawal benefit in cash, if a) he is leaving Switzerland and the Principality of Liechtenstein (subject to par. 4) permanently or b) he is becoming self-employed and is no longer subject to mandatory occupational pension provision, or c) the withdrawal benefit is less than his annual contribution. If the insured person is married, the spouse must give written consent to the cash payment. Management may request official confirmation of the signature and the marital status. If voluntary contributions were made during the last three years leading up to the departure, the resulting benefits may not be taken in cash. The pension plan gives no guarantee that such voluntary contributions will be tax deductible. 4 An insured person who leaves Switzerland and the Principality of Liechtenstein permanently cannot request payment of his BVG retirement capital in cash if he is still subject to mandatory insurance for the risks of old age, death and disability under the legal requirements of an EU member state, Iceland or Norway. 15
IV Special conditions Article 23 Conditions of payment 1 Pensions will be calculated in annual amounts and paid to those entitled to claim in monthly instalments, rounded up to the nearest franc. 2 The pension entitlement continues until the end of the month in which the person entitled to claim dies, or in which the pension entitlement lapses in accordance with the provisions of these rules. 3 If at the start of the pension a retirement or disability pension amounts to less than 10% of the minimum AHV retirement pension, or if a spouse's pension or pension for a cohabiting partner amounts to less than 6%, or if an orphan's pension amounts to less than 2%, then instead of paying a pension, the pension plan will make a one-off lump sum capital payment. The lump-sum capital payment is determined on the basis of actuarial calculations of the pension plan. When it is paid, all further entitlements of the insured person or his surviving dependants in respect of the pension plan lapse. 4 For people drawing pensions who are resident abroad, the pension plan may meet its obligation by transferring the insured benefits to an account to be opened in the name of the person entitled at a bank in Switzerland. At their request and risk, payments can also be sent abroad. Allowance for third-party benefits Article 24 1 If, in the event of disability or death of an insured or a recipient of a disability pension, the benefits payable by the pension plan and any other creditable income of the insured and his children exceed 100%, or 90% in the case of the survivors, of the presumed lost relevant annual salary pursuant to Art. 6 par. 2 plus any children s allowances, the pension payable by the pension plan will be reduced until and to the extent that this limit is no longer exceeded. These provisions also apply correspondingly to any lump-sum payments by the pension plan. The income received by the surviving spouse or live-in partner and the orphans will be added together. The retirement benefits will be reduced in the same manner for as long as benefits are paid by disability insurance or military insurance, or if the retirement benefits replace a disability pension. 2 Creditable income includes benefits of the same type and purpose paid to the eligible person due to an injuring event, such as: a) Benefits paid by the social security and disability insurance (AHV/IV) (and/or benefits paid by any Swiss or foreign social insurance schemes), except for care allowances for persons unable to look after themselves; b) Benefits paid by military insurance or compulsory accident insurance; c) Benefits paid under other insurance policies for which the company has paid at least 50% of the premiums; d) Benefits paid by pension plans and vested benefits institutions. Recipients of disability benefits will also be credited for any continued income from gainful employment or any income that the insured can still be reasonably 16
Rules l Sulzer Pension Plan expected to earn as well as any benefits paid by the unemployment insurance, with the exception of supplementary income paid during participation in reintegration measures pursuant to Art. 8a IVG. The calculation of the income that the insured can still be reasonably expected to earn is based on the disability pension pursuant to the decision of the IV. The creditable income is adjusted if the IV carries out a review of the disability pension. One-off lump-sum payments will be converted into pensions in accordance with the pension plan's actuarial rates. This does not apply to satisfaction payments and other similar payments. After reaching regular AHV retirement age, retirement benefits from Swiss and foreign social insurance bodies and pension plans are also deemed to be creditable income. However, the pension plan will at all times pay at least the benefits due under the BVG and its rules of application. 3 The pension plan will review the pension reduction from time to time. 4 The pension plan may reduce its benefits to the same extent if the AHV/IV reduces, withdraws or withholds a benefit because the eligible person has caused the death or disability through gross negligence or resists the IV's efforts to re-integrate him into the workforce. The trust is not obliged to compensate for benefits refused or reduced by the accident insurance or military insurance. 5 If the obligation of the accident insurance, military insurance or occupational retirement, survivors' and disability insurance under the BVG to pay a pension is disputed, the eligible person may request advance benefits from the pension plan. If it is unclear which pension scheme has to pay a pension claim, the eligible person may request advance benefits from the last pension scheme with which he was insured. The pension plan pays advance benefits in compliance with the BVG provisions on statutory minimum benefits. 6 If the claim is assumed by another insurance company or pension scheme, the latter must reimburse the advance benefits paid by the pension plan to the extent of its liability to pay benefits. Article 25 Claims against liable third parties The pension plan may require the applicant for a surviving dependants or disability benefit to assign to it claims for compensation which the applicant is entitled to make against liable third parties, up to the amount of its obligation to pay benefits. It may decline to pay benefits until such assignment has been made. Article 26 Set-off of claims Any claims against an insured or pensioner assigned to the trust by the company may not be set off against benefits payable by the pension plan. This provision does not apply to outstanding contributions of the insured. 17
Article 27 Guaranteeing pension benefit 1 Benefits payable by the pension plan are exempt from foreclosure to the extent permitted under the law. Subject to the provisions of Art. 30, claims on benefits from the pension plan may neither be assigned nor pledged before they are due. Any agreements to the contrary are invalid. 2 Benefits from the pension plan that were wrongfully received will be deducted from future benefit claims against the pension plan or must be repaid. Article 28 Information to the insured 1 Once a year every insured will receive an insurance certificate reflecting his retirement capital, insured salary, contributions, insured benefits and departure benefits. Every year the pension plan will inform the insured in an appropriate manner about the pension plan's organization and financing and the names of the members of the board of trustees. Insured receive a summary report every year, and on request an annual report and annual accounts. 2 The insured will be informed of his withdrawal benefit at the time of marriage. 3 In case of divorce, the insured or the divorce court will receive information if requested about the amount of the assets which are applicable for the calculation of the withdrawal benefit which is to be distributed. Article 29 Information and notification requirements 1 Employees and pension recipients, and their surviving dependants who are entitled to pensions are obliged truthfully to submit all information required by the pension plan to the pension plan, for the attention of the board of trustees. In particular: a) Within four weeks, any changes in marital status (marriage, births, deaths, divorce, etc.) and payments of benefits by third parties (Art. 24), b) any earnings from gainful employment earned by disabled insured persons. 2 The persons entitled are liable to the pension plan for consequences arising from the omission, inaccuracy or delay of information. 3 At the request of the pension plan, the pension recipient must submit an official certificate confirming that he is still alive. Article 30 Advance withdrawal, pledge, duty to provide information 1 The insured may request an advance withdrawal of benefits (at least CHF 20,000) to finance residential property for own use (purchase and construction of residential property, shares in residential property or repayment of mortgages) up to three years before entitlement to retirement benefits arises. 'Own use' in this context refers to usage as a domicile or place of usual residence. He can also 18
Rules l Sulzer Pension Plan pledge this amount or his claim to retirement benefits for the same purpose. 2 Until the age of 50 the insured may withdraw or pledge an amount equal to his accrued departure benefits. Insured older than 50 are only entitled to the accrued withdrawal benefits at the age of 50, or half of the withdrawal benefits at the time of the advance withdrawal. An advance withdrawal can be made every 5 years. If voluntary contributions were made during the last three years leading up to the advance withdrawal, the resulting benefits may not be taken in advance. The pension plan gives no guarantee that such voluntary contributions will be tax deductible. 3 The insured may submit a written request for information on the amount available to finance residential property and the reduction in benefits associated with such an advance withdrawal. The pension plan arranges for supplementary insurance to cover the insurance gap and informs the insured of his tax obligations. 4 If the insured person makes an advance withdrawal or pledges his benefits, he must submit the contracts pertaining to the purchase or construction of residential property or the repayment of a mortgage, the regulations or rental/loan agreement relating to the purchase of shares in a co-operative housing association and all official documents relating to similar purchases to the trust. Married insured persons must also submit the written consent of the spouse. 5 The pension plan will pay the advance withdrawal at the latest six months after the insured has requested the withdrawal. As long as there is a shortfall in cover, the pension plan may restrict the timing or amount of the payment of advance withdrawals required to repay a mortgage, or may refuse to make such a payment altogether. The pension plan must inform the insured of the duration of the measures. 6 If the liquidity of the pension plan is endangered by advance withdrawals, the pension plan may defer the processing of the applications. The board of trustees determines the order of priority according to which applications will be processed. 7 The retirement capital will be reduced by the amount of the advance withdrawal. The insured benefits will also be reduced by the amount of the advance withdrawal. Any (partial) repayment of the advance withdrawal will be treated as a voluntary purchase of additional benefits pursuant to Art. 9. 8 As set out in the enclosure to the pension fund rules, the pension plan charges a processing fee for advance withdrawals to finance residential property. Article 31 Divorce 1 If an insured person is divorced and the pension plan must transfer part of the departure benefits accrued during the marriage to the pension scheme of the divorced spouse under a court judgment, the insured's accrued retirement capital will be reduced by this amount. The insured benefits will be reduced by the transferred amount analogous to Art. 30 par. 7. The insured person may make a voluntary purchase of additional benefits pursuant to Art. 9 equalling the transferred amount. 19
2 If an insured receives the departure benefits of his divorced spouse (based on a court judgment), the payment will be treated as a voluntary purchase pursuant to Art. 9. V Assets of the pension plan Article 32 Assets / liabilities There is a cash fund to cover the scheduled benefits of the pension plan. The fund is liable exclusively for the obligations of the pension plan. A claims equalization reserve will be set up in order to absorb investment risks. Article 33 Benefit improvement In accordance with a decision of the board of trustees, certain reserves, which are based on expert principles, can be accrued within the SVE trust. These are in particular: - Claims equalization reserve - Reserve for unfavourable age structure I pension adjustments - Biometrical reserves - Reserves for risk share Any free assets remaining in excess of this amount are to be used in particular for - Increases in the retirement capital (e.g. additional interest credits) - Increases in the current pensions (one-off payment or lifelong increases) Pensions are adjusted to the increase in the cost of living in accordance with the pension plan's financial ability. The board of trustees decides every year if and to what extent pensions can be adjusted. The provisions of Art. 36 par. I BVG remain reserved. Article 34 Company s premium reserve 1 As part of the accounting procedures of the pension plan, premium reserves will be maintained for the company and affiliated employers. They will be accumulated from extraordinary payments by the companies and will earn interest in the same way as the retirement capital of the active insured persons, but the amount will not exceed the average earned income. 2 The resources of the premium reserve will be used by the board of trustees under the terms of the trust, with the agreement of the companies; they are to be used primarily to cover the companies statutory or special expenditure. VI Organization 20