Accrued Benefit means the amount of a Participant's monthly Regular Pension calculated at any point in time payable as of the Participant's Normal Retirement Date. The Accrued Benefit equals the sum of the Participant's Legacy Pension (if any) and the Participant's Variable Pension. Separate rules may apply to the Participant's Legacy Pension, as described in the current SPD or in a prior SPD.

Contribution or Contributions means money paid or payable to the Fund as required by a Contributing Employer pursuant to a collective bargaining agreement or other written agreement.

Legacy Pension means any benefit accrued by a Participant prior to the Variable Pension Plan effective date.

Variable Pension means any benefit accrued on or after the VPP effective date.

Hurdle Rate is five percent (5.0%). This means that if the Fund's Investment returns are greater than 5%, your VPP benefits will increase

Variable Pension Adjustment for each Plan Year is equal to one plus the Fund's Investment Return for the immediately preceding Plan Year, divided by one plus the Hurdle Rate. The Variable Pension Adjustment for any Plan Year cannot exceed 1.0500.

This means the maximum VPP benefits can increase in one year is 5%

Break-In-Service occurs in any Calendar Year during which you fail to earn at least 200 Hours of Service.

You become an "active" participant in the Pension Fund at the end of the Plan Year (January 1 - December 31) in which you work in Covered Employment for 800 hours or more. Once you meet the initial eligibility requirement, your eligibility will continue as long as you remain an Eligible Employee and obtain at least 200 hours in each Plan Year.

The eligibility requirement is based on all hours which are credited for vesting purposes under the Plan

Certain plan provisions are limited to grandfathered members of certain plans prior to the December 31, 2022 merger date. These participants are classified as follows:

A "Grandfathered PHL Participant" means a Participant in the Carpenters Pension and Annuity Fund of Philadelphia and Vicinity Pension Plan before January 1, 2023, or any individual who had at least one Contribution Hour in the PHL Pension Plan prior to January 1, 2023.

A "Grandfathered NE Participant" means a Participant in the Northeast Plan before January 1, 2023, or any individual who had at least one Contribution Hour in the Northeast Plan prior to January 1, 2023.

A "Grandfathered PHL Staff Participant" means a Participant in the Pension Plan of the Carpenters Benefits Funds of Philadelphia and Vicinity before January 1, 2023, or any individual who had at least one Contribution Hour in the PHL Staff Plan prior to January 1, 2023.

You will be considered an "inactive" participant if you have less than 200 Credited Hours during any Plan Year. You may also become "inactive" earlier if you cease to be available for and to be actively seeking Covered Employment. When you work again in Covered Employment for 800 or more Credited Hours in a Plan Year, you will become an active participant at the end of the Plan Year.

Credited Hours are used to determine your eligibility and benefits from the Pension Fund. In order to receive credited service, you must obtain Credited Hours.

Generally, after 1981, Credited Hours are a combination of:

• Payment Hours, also called "Contribution Hours" (hours you worked for which employer contributions are made to the Pension Fund for your work).
• Delinquent Hours are hours you worked for which employer contributions are due but which have not been paid to the Pension Fund for your work by the delinquent employer. You must provide evidence of your work such as a pay stub or similar record to the Fund Office to receive credited hours.
• Weekly Disability or Workers' Compensation Hours for which you receive benefits from the Eastern Atlantic States Health Fund.
• School hours for Apprenticeship training with the Eastern Atlantic States Carpenters Technical College.
• Qualified Military Service. Military service up to 5 years for the United States is credited if you leave work with a contributing Plan employer for military service and return within the periods provided by law. You must present yourself for work in Covered Employment:

(a) within 90 days after your discharge from military service over 180 days,

(b) within 14 days for military service between 30 and 180 days and

(c) immediately for service under a month. For military service before 1994, you had to return to Covered Employment within 90 days of discharge regardless of the length of your military service. Military service for the United States is also credited if you leave work with a contributing Plan employer for military service and you either pass away or become disabled after December 31, 2006 while performing military service. Service is credited as though you had returned to work on the date of your passing or on the date of the onset of your disability. Hours credited for Qualified Military Service are treated the same as "Payment Hours."

For service prior to 1982, please contact the Fund office.

For periods before a plan merger, Credited Hours shall include hours before the merger that were credited for purposes of participation or vesting under the merged plan in accordance with the merger agreement with the Plan.

You should check your benefit statements and contact the Fund Office with documentation if you think that you have Credited Hours which are Qualified Military Service, Delinquent Hours or other hours for which contributions were not actually paid to the Plan and that are not on your statement.

Generally, you earn Years of Vesting Service like Years of Credited Service.

"Vesting" means you remain entitled to a benefit from the Plan, regardless of whether you continue to work in Covered Employment until retirement.

• Generally, if you earn at least five (5) Years of Vesting Service, you are "vested" in your Accrued Monthly Pension Benefit under the Plan.
• You may also be vested if you are working in Covered Employment at the later of age 65 or the 5th anniversary of your participation in the Plan.
• If you are a Grandfathered PHL Participant or a Grandfathered PHL Staff Participant, you are "vested" in your Accrued Monthly Pension Benefit under the Plan if you have earned at least three (3) Years of Vesting Service.

For questions about vesting based on service earned prior to December 31, 2022, please contact the Fund Office.

If you are vested when you become an Inactive Participant, you are eligible to receive your full Accrued Monthly Pension at your Normal Retirement Date (usually, the first month after you turn 65). If you do not apply for benefits by your Normal Retirement Date, your benefits may be increased to account for the delay, in the absence of Disqualifying Employment. If you do not apply for benefits before the April 1 after the year in which you reach your Required Distribution Age (age 72, unless you turned age 70½ prior to December 31, 2019 in which case the age would be age 70½), the Plan will begin payments to you calculated under IRS regulations.

The amount of your Deferred Vested Pension is equal to your Accrued Monthly Pension at the time you ceased to be an Active Participant and is payable beginning at Normal Retirement Date. If you are entitled to a Deferred Vested Pension, you may elect to collect the pension amount starting as early as age 55. Note that in this case the amount would be reduced by ½ of 1% for each month by which your age is less than age 65 at the time the pension begins.

For example:

• If you were to begin to collect a Deferred Vested Pension at age 65, you would receive 100% of your Accrued Monthly Pension.
• If you were to begin to collect at age 55, you would receive 40% of your Accrued Monthly Pension.

An Inactive Vested Participant has the same options on the form of payment as Active Participants described in the Types of Monthly Retirement Options section of this booklet.