1999 Academic Pension Plan

THE UNIVERSITY OF SASKATCHEWAN 1999 ACADEMIC PENSION PLAN

June 6, 2000

Prepared by: AON CONSULTING 8^th Floor, Canada Building 105-21^st Street East Saskatoon, Saskatchewan S7K 0B3 Telephone: (306) 934-8680 Fax: (306) 244-7597 CONTENTS

INTRODUCTION *

ARTICLE 1: DEFINITIONS *

ARTICLE II: ELIGIBILITY AND MEMBERSHIP *

ARTICLE III: CONTRIBUTIONS *

ARTICLE IV: INTEREST *

ARTICLE V: CONTINUOUS EMPLOYMENT AND CREDITED SERVICE *

ARTICLE VI: RETIREMENT DATES AND CONDITIONS *

ARTICLE VII: NORMAL RETIREMENT PENSION *

ARTICLE VIII: EARLY RETIREMENT PENSION *

ARTICLE IX: POSTPONED RETIREMENT PENSION *

ARTICLE X: PAYMENT OF PENSIONS: NORMAL AND OPTIONAL FORMS *

ARTICLE XI: TERMINATION OF SERVICE *

ARTICLE XII: WITHDRAWAL FROM PLAN *

ARTICLE XIII: DEATH BENEFITS *

ARTICLE XIV: BENEFICIARIES *

ARTICLE XV: RIGHTS ON DISCONTINUANCE OF PLAN *

ARTICLE XVI: NON-COMMUTATION OF BENEFITS *

ARTICLE XVII: FUND, FUND MANAGERS, INVESTMENT ADVISORS AND ACCOUNTS *

ARTICLE XVIII: ADMINISTRATION AND PROCEDURES *

ARTICLE XIX: GENERAL *

ARTICLE XX: AMENDMENTS *

ARTICLE XXI: TRANSFERS TO AND FROM THE NON-ACADEMIC PLAN *

APPENDIX A: PENSION ADJUSTMENTS *

APPENDIX B: TIAA/CREF *

G:\2000\UOFS\PLAN-TXT\ACADEMIC\NEW_APP\NAPP_TEXT_CLEAN.DOC INTRODUCTION

The Pension Plan for the Administrative and Academic Employees of the University of Saskatchewan, 1999 was established effective January 1, 1999 as a consequence of The Pension Plan for the Academic Employees of the University of Saskatchewan, 1974 being divided between that plan's retirees and other beneficiaries and its other members. Upon its establishment, the following members of The Pension Plan for the Academic Employees of the University of Saskatchewan, 1974 were segregated from The Pension Plan for the Academic Employees of the University of Saskatchewan, 1974 as at January 1, 1999 and transferred to this Plan:

active members;

inactive members; and

members whose employment with the University had terminated but who remained entitled to a deferred pension benefit. Assets sufficient to cover the accrued liabilities of the members transferring to this Plan as well as a portion of the surplus from The Pension Plan for the Academic Employees of the University of Saskatchewan, 1974 were segregated from The Pension Plan for the Academic Employees of the University of Saskatchewan, 1974 as at January 1, 1999 and transferred to this Plan.

This Plan is a continuation of The Pension Plan for the Academic Employees of the University of Saskatchewan, 1974 (the "1974 Plan") for individuals who transferred to the Plan from the 1974 Plan effective January 1, 1999. Consequently, reference throughout this Plan to pension benefits, contributions (whether made by the applicable Member or by the University on the Member's behalf) with Credited Interest, Credited Service and all other rights and entitlements of Members of the Plan who were Members of the Previous Plan shall include all pension benefits, contributions with Credited Interest, Credited Service and all other rights and entitlements of such Members earned under 1974 Plan up to January 1, 1999, notwithstanding the absence of specific reference to the 1974 Plan under any particular provision of this Plan. Furthermore, the generality of the foregoing shall not be limited by the presence of specific reference to the 1974 Plan in some, but not all, particular provisions herein.

ARTICLE I - DEFINITIONS

The following terms wherever used in this instrument shall, for the purposes thereof, unless the context otherwise requires have the meaning set forth below, despite any definitions that conflict therewith in any other document:

1. "Actuary" means such actuary as the Board may from time to time appoint for purposes of making actuarial valuations and of performing other services in connection with the Plan, and shall be an individual who is a Fellow of the Canadian Institute of Actuaries.

2. "Additional Voluntary Contributions" means contributions and payments made under paragraphs (c) and (e) of Section 2 of Article III (CONTRIBUTIONS).

3. "Anniversary Date" means January 1st.

4. "Annuity" means, for the purpose of this Plan, an investment purchased in the market place to yield a pre-determined sum of money, payable to the benefactor for life, and may include a guaranteed minimum number of monthly payments and/or pre-determined sums payable to the benefactor's Spouse as permitted pursuant to the Income Tax Act and Regulations.

5. "Association" means the Faculty Association of the University.

6. "Average Earnings" means the total Earnings received by a Member during any period of four consecutive years of participation in the Previous Plan and the Plan, divided by the difference between four and the total number of years and fractions thereof in any periods of leaves of absence without pay during such four-year period. Where a Member is employed less than full-time, the denominator shall be calculated using the proportion that actual employment is of full-time employment.

7. "Beneficiary" means a person or persons designated as such by a Member in accordance with Article XIV (BENEFICIARIES).

8. "Best Average Earnings" means the highest Average Earnings of a Member. If the Member does not have four years of participation in the Previous Plan and the Plan, the Member's Best Average Earnings shall be the annual average of the Earnings received during his years of participation, excluding any years or fractions thereof in any leaves of absence without pay in the period of his participation.

9. "Board" means the Board of Governors of the University of Saskatchewan.

10. "Continuous Employment" means continuous employment as defined in Article V (CONTINUOUS EMPLOYMENT AND CREDITED SERVICE). Continuous Employment shall be expressed in years, with parts of a year taken to the nearest month.

11. "Credited Interest" means the amount of interest determined in accordance with Article IV (INTEREST).

12. "Credited Service" means the sum of Credited Future Service and Credited Past Service.

13. "Credited Future Service" means the period of Continuous Employment on and after the Effective Date credited in accordance with Section 2 of Article V (CONTINUOUS EMPLOYMENT AND CREDITED SERVICE) for calculation of pension benefits. Credited Future Service shall be expressed in years with parts of a year taken to the nearest month.

14. "Credited Past Service" means the period of Continuous Employment prior to the Effective Date credited in accordance with Section 3 of Article V (CONTINUOUS EMPLOYMENT AND CREDITED SERVICE) for calculation of pension benefits. Credited Past Service shall be expressed in years with parts of a year taken to the nearest month.

15. "Earnings" means gross earnings paid to the Member by the University or other employer contributing under this Plan, as reported to the Department of National Revenue, Income Tax Division. Earnings do not include monies paid from sundry allowances, honorariums, fees, summer school, intercession and night class stipends, or any other money paid in addition to the Member's ordinary salary, unless specifically included at the direction of the Board. For a Member whose salary is paid by the University and by the Province of Saskatchewan, Earnings for the purpose of the Plan shall be:

his University salary x Median for his rank
his total salary
In the case of a Member of the clinical medical staff or a Member whose salary is paid by the University and by the University Hospital, Earnings for the purpose of the Plan shall be the academic component of his salary as designated by the Appointments Committee and adjusted by subsequent salary adjustments. For Members who are on the Reduced Appointment Plan (1984), Earnings shall be taken to mean the nominal salary which would be paid to the Employee if on a full-time basis. Notwithstanding any other provision in this Plan, a Member's Earnings in any one year shall not exceed the greater of:

(a) an amount equivalent to the median of annual salaries earned by all full professors and deans in that year, which amount shall be rounded up to the next higher multiple of $500 if not already a multiple of $500; and

(b) an amount equivalent to the median of annual salaries earned by all full professors and deans in the preceding year, which amount shall be rounded up to the next higher multiple of $500 if not already a multiple of $500.

In addition to the foregoing provisions, "Earnings" includes any prescribed compensation as permitted and described in the Income Tax Act and Regulations.

16. "Effective Date" means January 1, 1999.

17. "Employee" means a member of the administrative and academic staff, excluding sessional lecturers.

18. "Fringe Benefits Committee" means the persons appointed in accordance with Article XVIII hereof.

19. "Fund" means the total assets of the Plan including assets transferred from the Previous Plan and all monies and investments and contracts with Insurers which provide for benefits to or in respect of Members, save any such contract made between an Insurer and an individual Member or his Joint Annuitant or Beneficiary.

20. "Fund Manager" means a trust company or insurance company appointed by the Board to be the administrator and custodian of the Fund in accordance with the Plan and any agreement with the Board.

21. "Inactive Member" means a Member, other than a Pensioner, whose Required Contributions have been discontinued for any reason but who remains entitled to any benefits payable from the Fund.

22. "Income Tax Act" means the Income Tax Act, Statutes of Canada, and the Regulations thereunder, and where applicable includes the provisions of Information Circular 72-13R8 issued by the Department of National Revenue, as they may be amended from time to time.

23. "Insurer" means a life insurance company or the Government of Canada or any other entity authorized to transact Annuity business in Canada or in any of the Provinces of Canada.

24. "Investment Advisor" means such trust company or insurance company or investment counsel or other person as the Board may from time to time appoint for the purposes of instructing the Fund Manager as to the investment of the Fund.

25. "Joint Annuitant" means a person designated as such in an election made under paragraphs (b), (c) and (d) of Section 4, of Article X.

26. "Long Term Disability Plan" means the Salary Continuation Plan established by the University to provide long term disability benefits for its employees.

27. "Member" means a person who has become a Member in accordance with Article II (ELIGIBILITY AND MEMBERSHIP) and who remains entitled to any benefit payable from the Fund.

28. "Normal Retirement Date" means the 30th of June coincident with or next following a Member's 67th birthday.

29. "Original Plan" means the Superannuation and Pension Plan, or other pension plan, that was in effect prior to the Previous Plan and under which Members, while Employees of the University, earned pension benefits prior to June 30, 1965.

30. "Pension Benefits Act" means The Pension Benefits Act of Saskatchewan as amended from time to time and the Regulations issued thereunder and such other similar legislation and the regulations thereunder as may have been or be enacted by a province of Canada and which is applicable to the Plan.

31. "Pensioner" means a Member to whom a pension has been granted under the Plan, the first payment of which has fallen due having regard to the provisions of Section 4 of Article XVIII (ADMINISTRATION AND PROCEDURES).

32. "Permanent Employee" means for the purposes of this Plan, an Employee who is employed half-time or greater in:

(a) a probationary appointment leading to permanent status; (b) a term appointment of two years or more, or

(d) continuous term appointments where the sum of the appointments exceeds two years. 33. "Plan" means the pension plan for the Administrative and Academic Employees of the University as set forth in this instrument, which is named "The University of Saskatchewan 1999 Academic Pension Plan", and as amended from time to time.

34. "Plan Factors" means such factors determined on an actuarial equivalent basis and such standards and procedures for determining amounts of pensions, amounts of interest, commuted values of pension and other standards and procedures of a like nature as are adopted from time to time by the Fringe Benefits Committee on the advice of the Actuary and in accordance with generally accepted actuarial principles. Insofar as benefits are paid under an insurance or Annuity contract, such standards and procedures shall be determined by the Insurer.

35. "Previous Plan" means The Pension Plan for the Academic Employees of the University of Saskatchewan, 1974 under which Members, while Employees of the University, earned pension benefits prior to the Effective Date. The Plan supersedes the Previous Plan, and it shall not operate in any manner to diminish any benefits earned thereunder.

36. "Reciprocal Agreement" means an agreement between the Board and the sponsor of another registered pension plan, which provides for the transferability of contributions and service credits between the Plan and the plan of the sponsor who is a party to such agreement. It is provided that references in this instrument to service of any kind and contributions of any kind shall be construed to include any applicable service and contributions which have been transferred to the Plan under a Reciprocal Agreement.

37. "Required Contributions" means contributions made in accordance with paragraph (a) of Section 2 of Article III (CONTRIBUTIONS).

38. "Retroactive Contributions" means contributions made in accordance with paragraph (b) of Section 2 of Article III (CONTRIBUTIONS).

39. "RSP" means, for the purpose of this Plan, a retirement savings plan which is registered pursuant to the provisions of the Income Tax Act and conforms to the prescribed lock-in requirements of The Pension Benefits Act and Regulations for such plans, and includes a registered retirement savings plan (RRSP), a registered retirement income fund (RRIF), a life income fund (LIF) and any such similar plans to the extent that they are permitted under The Pension Benefits Act.

40. "Spouse" means:

(a) a person who is married to a Member; or (b) if a Member is not married, a person of the opposite sex with whom the Member is cohabiting as husband and wife at the relevant time and who has been cohabiting continuously with the Member as his or her spouse for at least one year prior to the relevant time.
41. "Transferred Voluntary Contributions" means contributions made in accordance with paragraph (e) of Section 2 of Article III (CONTRIBUTIONS).

42. "University" means the University of Saskatchewan, 1974, or a Federated college operating under the jurisdiction of the Board.

43. "Waiting Period" for academic staff means the lesser of:

(a) (3) years of Continuous Employment, and (b) the period from the date of employment to the date they are granted tenure or permanent status,

and for other employees, Waiting Period means three years of Continuous Employment.

44. "YMPE" (Year's Maximum Pensionable Earnings) means the maximum earnings, as set from time to time by Federal Government regulation, for the purposes of the Canada Pension Plan.

References to the male gender will include the female gender unless the context otherwise requires. Words importing the singular number may be construed to extend to and include the plural number, and words importing plural number may be construed to extend to and include the singular number. References to an Article, Section or paragraph means an Article, Section or paragraph in this instrument.

ARTICLE II ELIGIBILITY AND MEMBERSHIP 1. Eligibility

(a) Employees who were Members and all individuals who were Inactive Members of the Previous Plan on December 31, 1998 shall become Members of the Plan on the Effective Date.

(b) Employees who were eligible to join the Previous Plan on December 31, 1998 are eligible to join the Plan on or after the Effective Date.

(c) Employees referred to in paragraph (b) of this Section must join the Plan, as a condition of employment, on or before the expiration of their Waiting Period.

(d) Employees who become Permanent Employees on or after the Effective Date become eligible to join the Plan on or after the date they become Permanent Employees.

(e) Employees referred to in paragraph (d) of this Section may join the Plan when they first become eligible and must join the Plan, as a condition of employment, on or before the expiration of their Waiting Period.

2. Membership

(a) To join the Plan, an eligible Employee must complete and sign the form or forms prescribed for that purpose by the Fringe Benefits Committee and authorize the deductions from his Earnings as required under the Plan.

(b) Once an Employee becomes a Member, membership shall be maintained even though the Member's subsequent employment status falls below the levels stipulated for initial eligibility to become a Plan Member.

3. Explanation to Members (a) The University shall provide a written description of the Plan to each of its Employees who is eligible to join the Plan, on or before the date of first eligibility. Such description shall explain the terms and conditions of the Plan and amendments thereto as applicable to the Employee, and shall outline the rights and duties of the Employee with reference to the benefits available and the contributions payable under the Plan. (b) Within six months after any amendment to the Plan, the University shall provide a similar explanation of the amendment to each Member and eligible Employee affected by the amendment. (c) Upon cessation of employment or termination of membership of a Member entitled to an immediate or deferred pension, the University shall provide the Member with a written statement showing the benefits to which he is entitled. (d) Upon the death of a Member, who was entitled to an immediate or deferred retirement benefit, the University shall provide the Spouse or the deceased Member's legal representative with a written statement showing the benefits which are payable. The written statement shall be provided within thirty (30) days of the University being notified of the death. (e) A meeting shall be held annually to advise the Members of matters relating to the Plan. 4. Annual Employee Statements

Within one hundred and eighty (180) days of the Plan year end, the University shall provide each Member with an annual statement containing such information as The Pension Benefits Act may require.

5. Disclosure

(a) A copy of this Plan text, any trust deed or agreement, insurance contract, bylaw, resolution, or investment contract relating to the Plan may be examined by a Member at any reasonable time at such offices as are designated by the University.

(b) The Member may, once in each calendar year, either personally or by an agent authorized in writing, examine the documents filed with the Superintendent of Pensions and order, in writing, a photocopy of any such documents.

(c) In the event that a benefit is to be divided pursuant to a court order or a written interspousal agreement, the pertinent information shall be provided, upon request, to the Member, Spouse or the solicitor of any of them. The Member shall be notified of the information provided to the Spouse or the solicitor.

ARTICLE III CONTRIBUTIONS

1. Total Required Contributions

The Total Required Contributions to the Plan, with respect to each Member who is not a Pensioner or an Inactive Member, shall be 13.64% of Earnings.

2. Members (a) Required Contributions Each Member who is not a Pensioner or an Inactive Member shall contribute to the Plan, during each calendar year, the amount of the Total Required Contributions that is not contributed by the University in accordance with Section 3 of this Article. Such Member Required Contributions shall conform to the provisions of this Plan and, for calendar years prior to the Effective Date, shall include contributions of a like nature that were contributed to the Previous Plan. Such Required Contributions shall be deducted from the Member's Earnings by the University. (b) Retroactive Contributions Subject to the provisions of the Income Tax Act (Canada) and the regulations thereunder, a Member, other than a Pensioner or an Inactive Member, may make Retroactive Contributions to the Plan in respect of one or more periods of Continuous Employment rendered under the Original Plan, including any Waiting Period, for which the Member was unable to make contributions. The amount of such Retroactive Contributions shall be equal to the contributions which would have been paid by the Member under the terms of the Original Plan, based on the Member's Earnings during the applicable period of Continuous Employment, with Credited Interest thereon to the date of such election, but shall not exceed the amount required to purchase the maximum pension described hereafter in this Section. Subject to the provisions of the Income Tax Act (Canada) and the regulations thereunder, a Member, other than a Pensioner or an Inactive Member, may make Retroactive Contributions to the Plan in respect of one or more periods of Continuous Employment rendered prior to the date the Member became eligible to join the Previous Plan, excluding any Waiting Period, for which the Member was unable to make contributions. The amount of such Retroactive Contributions shall be equal to the contributions which would have been paid by the Member under the terms of the Previous Plan, based on the Member's Earnings during the applicable period of Continuous Employment, with Credited Interest thereon to the date of such election, but shall not exceed the amount required to purchase the maximum pension described hereafter in this Section. Notwithstanding anything else contained herein, effective June 8, 1990, the maximum pension which can be purchased pursuant to this Section for pre-1990 service is:

(i) for periods while the individual was not a contributor to this Plan, the Previous Plan or the Original Plan, $1,150 per year of service to be credited or two-thirds (2/3) of the amount specified in Article VII, Section 4, whichever is greater; and

(ii) for periods while the individual was a contributor to this Plan, the Previous Plan or the Original Plan, $1,722 per year of service to be credited.

Such Retroactive Contributions may be paid in a single lump sum, or in a series of installments which take account of further Credited Interest, over a period not extending beyond the Member's Normal Retirement Date. It is provided that the period of Continuous Employment in respect of which the foregoing election is made shall be limited to an amount such that the Member's total potential Credited Service at his Normal Retirement Date is not greater than 35 years.

It is further provided that any election under this paragraph shall be subject to the approval of the Fringe Benefits Committee. For years prior to the Effective Date, Retroactive Contributions shall include contributions of a like nature that were contributed to the Previous Plan.
(c) Additional Voluntary Contributions Subject to the provisions of paragraph (d) of this Section, any Member may make Additional Voluntary Contributions for years of service rendered to the University to provide an additional retirement benefit. Such contributions:

(i) shall be credited to an individual account maintained for the Member;

(ii) shall be in addition to the Member's Required and Retroactive Contributions; and

(iii) may consist of: (A) voluntary current service contributions which are retained by the University from the Member's remuneration during the calendar year; (B) providing the payment was made prior to October 9, 1986, voluntary past service contributions made on behalf of each year of Continuous Employment rendered to the University while the Member was a contributor under the Plan or the Previous Plan; and (C) providing the payment was made prior to October 9, 1986, voluntary past service contributions made on behalf of each year of Continuous Employment rendered to the University while the Member was not a contributor under the Plan or the Previous Plan.
For years prior to the Effective Date, Additional Voluntary Contributions shall include contributions of a like nature that were contributed to the Previous Plan. (d) Maximum Member Contributions Permissible Pursuant to paragraph 8503(4)(a) of the Income Tax Regulations, the aggregate amount of current service contributions made by a Member in respect of a calendar year after 1990 shall not exceed the lesser of:

(i) nine percent (9%) of the Member's Earnings for the year from the University; and

(ii) the aggregate of $1,000 and fifty percent (50%) of the aggregate of all amounts each of which is the amount that would be the Member's pension credit (that is, the annual pension accrual times a factor of nine) for the year in respect of the University.

Contributions shall be returned to the contributor if it is found that the contribution maximums have been exceeded and the Plan registration could be revoked. Such returns to the contributor shall be taken:

(iii) firstly, from Member Additional Voluntary Contributions; and

(iv) secondly, in proportionate amounts, from Member Required Contributions and University Contributions.
(e) Transferred Voluntary Contributions (Transfer of Withdrawal Benefits)   Any Member not being a Pensioner or an Inactive Member may pay or cause to be paid into the Plan, as permitted by the Income Tax Act, an amount received or receivable by him as a cash withdrawal benefit under any other employee pension plan registered as such with the Department of National Revenue for the purposes of the Income Tax Act.   Such an amount shall, except as provided in the following paragraph, and in Section 6 of this Article, be treated as Transferred Voluntary Contributions for the purposes of the Plan. It is, however, provided that such an amount shall be permitted to be refunded in a lump sum in accordance only with Article VII (NORMAL RETIREMENT PENSION) or Article XI (TERMINATION OF SERVICE) if this is permitted by The Pension Benefits Act.   The Member may request that the Fringe Benefits Committee instruct the Fund Manager to utilize such amount for the purchase from an Insurer of a deferred Annuity policy on the life of the Member. The Fund Manager shall be the owner of and sole beneficiary under such a policy in the name of the Fund, and the Member shall have no rights or entitlements under such a policy.   3. Current Service Contributions by the University   The University shall contribute on a regular basis a proportion of the Total Required Contributions. Such proportion shall be set from time to time and shall be at least 50%.   The University shall also contribute an amount equal to the Retroactive Contributions of the Members made with respect to periods of Continuous Employment prior to July 1, 1982, and the applicable percentage of the Retroactive Contributions of the Members made with respect to periods of Continuous Employment on or after July 1, 1982.   For years prior to the Effective Date, current service contributions made by the University shall include contributions of a like nature that were contributed to the Previous Plan.
4. Additional Contribution by the University   In order to maintain the long term solvency of the Plan, and in order to fund any increases in benefits which may be adopted, the University is empowered to make additional contributions to the Fund from time to time, on the recommendation of the Actuary.
5. Adequacy of Funding   Current service benefits shall be funded in the year of accrual, and any initial unfunded liabilities and experience deficiencies shall be funded over periods not in excess of those prescribed by The Pension Benefits Act. However, if the Actuary should warn that the then current level of the University's contributions will not maintain the then current scale of benefits, the Board shall have the right, on the recommendation of the Fringe Benefits Committee, to make any adjustments deemed necessary to the benefits to be credited in respect of Continuous Employment after such time, provided that such adjustments shall comply with the provisions of The Pension Benefits Act. In the event of a Plan surplus at a level exceeding the amount permissible under Section 147.2(2) of the Income Tax Act and if the Plan is not amended so as to comply with Section 147.2(2) of the Income Tax Act within 90 days of the Fringe Benefits Committee receiving the actuarial valuation report, the Required Contributions as determined in Sections 1, 2 and 3 of this Article above shall be adjusted proportionately so that the contribution levels as defined under these sections will comply with the Income Tax Act.   6. Transfers under Reciprocal Agreements   Notwithstanding paragraph (e) of Section 2 of this Article, if the Board enters into a Reciprocal Agreement with another employer, any amounts which are transferred to the Fund under the Reciprocal Agreement shall be administered in accordance with such Agreement. It is further provided that, if it is permitted by the terms of a Reciprocal Agreement, a Member who transfers to the Plan under such an Agreement shall be permitted to make Retroactive Contributions.   7. Payments to the Fund Manager   From time to time but not less frequently than required by The Pension Benefits Act the University shall pay to the Fund Manager:

(a) all contributions made by or on behalf of Members under this Article retained or received by the University; and

(b) the University's own contributions to the Plan. 8. Permissible Contributions

No contribution or gift may be made to or under this Plan except as provided herein.

9. Transfer of Assets from The Pension Plan for the Academic Employees of the University of Saskatchewan, 1974 As a consequence of the division of the Previous Plan into two plans, certain assets and liabilities from the Previous Plan were transferred to this Plan with effect as of January 1, 1999 in accordance with the actuarial valuation prepared as of December 31, 1998 for purposes of division. All contribution accounts as created under the Previous Plan in respect of Members who transferred from the Previous Plan shall be transferred to similar accounts in the Plan and shall be of a same nature and administered in a like manner.
ARTICLE IV INTEREST

1. Subject to Section 2 of this Article, for the purposes of Article VII (NORMAL RETIREMENT PENSION), Article XI (TERMINATION OF SERVICE), Article XIII (DEATH BENEFITS) and Article XV (RIGHTS ON DISCONTINUANCE OF PLAN), interest shall be credited from the Anniversary Date next following the date on which such contributions were made to the Previous Plan with respect to contributions made on or before December 31, 1981, and from the date such contributions were made to the Previous Plan and to this Plan with respect to contributions made on or after January 1, 1982. Interest shall be compounded annually on the Anniversary Date each year with proportionate interest up to the first day of the month in which the payment is made.

2. Notwithstanding Section 1 of this Article, interest on monies transferred under a Reciprocal Agreement shall be credited from the date as of which the amount to be transferred is calculated, up to the next following Anniversary Date. Interest on such amounts shall be compounded on each Anniversary Date thereafter.

3. Subject to Section 4 of this Article, the annual rate of interest to be applied each year to Employee and University contributions and on Transferred Voluntary Contributions shall be:

(a) prior to January 1, 1982 - 4%;

(b) from January 1, 1982 to December 31, 1984, inclusive - the applicable rate specified as the minimum rate by The Pension Benefits Act; (c) from January 1, 1985 to December 31, 1992, inclusive, subject to the annual approval of the Fringe Benefits Committee of the Previous Plan, - the greater of:
(i) the applicable rate specified as the minimum rate by The Pension Benefits Act, and (ii) up to 100% of the average rate of return of the Previous Plan's fund over the four most recent complete calendar years as published in the Comparative Measurement Service Report commissioned by the Fringe Benefits Committee of the Previous Plan;
(d) from January 1, 1993 to February 28, 1995, subject to the annual approval of the Fringe Benefits Committee of the Previous Plan, - the greater of:
(i) the average of the yields of five-year personal fixed term chartered bank deposit rates (CANSIM, series B 14045) calculated on the basis of, for annual statements, the average for the calendar year to which the statement applies and for payouts during the year, the average for the previous calendar year; and (ii) up to 100% of the average rate of return of the Fund over the four most recent complete calendar years as published in the Comparative Measurement Service Report commissioned by the Fringe Benefits Committee of the Previous Plan.
(e) From March 1, 1995, interest shall be credited to Employee and University contributions such that the total Employee and University contribution balance with interest will be the greater of:
(i) the total Employee and University contribution balance with interest as at December 31, 1993 as determined in paragraphs (a) to (d) of Section 3 above, plus future Employee and University contributions, credited with interest from January 1, 1994 based on the average of the yields of five-year personal fixed term chartered bank deposit rates (CANSIM, series B-14045), to be credited on the basis of:
(A) for annual statements, the average for the calendar year to which the statement applies, and (B) for payouts during the year, the average rate for the previous calendar year. (ii) the total Employee and University contribution balance calculated as at December 31, 1993 based on crediting interest rates retroactively to the Member's date of joining the Previous Plan on the annual gross rate of return earned by the Fund, for each year to December 31, 1993, less 1.3%. For balances on or after January 1, 1994, the interest rate credited shall be the geometric average net rate of return of the Previous Plan's fund over the four most recent complete calendar years, as published in the Comparative Measurement Service Report commissioned by the Fringe Benefits Committee of the Previous Plan, less 1%, to be credited on the basis of:
(A) for annual statements at the end of the current calendar year, the geometric average of the four previous years' net rates of return less 1% as determined above, and (B) for payouts during the year, the geometric average of the four previous years' net rates of return less 1% credited for the applicable period from January 1 of the current year up to the date of payment.

Notwithstanding the above, a Member who had terminated employment prior to January 1, 1994 and who had not elected to transfer funds out of the Previous Plan will not be eligible to receive the retroactive adjustment in contribution balances as outlined in (i) and (ii) above.

(f) From March 1, 1995, interest shall be credited to Transferred Voluntary Contributions such that the total Transferred Voluntary Contribution balance with interest will equal the total Transferred Voluntary Contribution balance calculated as at December 31, 1995 based on crediting interest rates retroactively to the Member's date of joining the Previous Plan or the annual gross rate of return earned by the Previous Plan's Fund, for each year to December 31, 1995, less .3%. For balances on or after January 1, 1996, the interest rate credited shall be the geometric average net rate of return of the Fund or the Previous Plan's fund as applicable over the four most recent complete calendar years, as published in the Comparative Measurement Service Report commissioned by the Fringe Benefits Committee of the Plan or the Previous Plan as applicable, to be credited on the basis of:
(a) for annual statements at the end of the current calendar year, the geometric average of the four previous years' net rates of return as determined above; and (b) for payouts during the year, the geometric average of the four previous years' net rates of return credited for the applicable period from January 1 of the current year up to the date of payment.
(g) From January 1, 1997, interest shall be credited to Employee and University contributions such that the total Employee and University contribution balance with interest will be the greater of:
(i) the total Employee and University contribution balance with interest as at December 31, 1996 as determined in paragraphs 3(a) to (e) above, plus future Employee and University contributions, credited with interest from January 1, 1997 based on the average of the yields of five-year personal fixed term chartered bank deposit rates (CANSIM, series B-14045), to be credited on the basis of:
(A) for annual statements, the average for the calendar year to which the statement applies; and (B) for payouts during the year, the average rate for the previous calendar year; and
(ii) the total Employee and University contribution balance calculated as at December 31, 1996 based on crediting interest rates retroactively to the Member's date of joining the Previous Plan on the annual gross rate of return earned by the Previous Plan's fund for each year to December 31, 1981, less .3%, and for each year from January 1, 1982 to December 31, 1993, less 1.3%. For balances on or after January 1, 1994, the interest rate credited shall be the geometric average net rate of return of the Fund or Previous Plan's fund as applicable over the four most recent complete calendar years, as published in the Comparative Measurement Service Report commissioned by the Fringe Benefits Committee of the Plan or Previous Plan as applicable, less 1%, to be credited on the basis of:

(A) for annual statements at the end of the current calendar year, the geometric average of the three previous years' and the current years' net rates of return; and

(B) for payouts during the year, the geometric average of the four previous years' net rates of return credited for the applicable period from January 1 of the current year up to the date of payment.

Effective January 1, 1997, an Inactive Member who retired or terminated between January 1, 1994 and December 31, 1996, will receive a retroactive adjustment in contribution balances as outlined in subparagraph (ii) above, if applicable, as if this provision was in effect at the date of the Inactive Member's retirement or termination.

4. For the purposes of calculating Retroactive Contributions made under paragraph (b) of Section 2 of Article III (RETROACTIVE CONTRIBUTIONS), the annual rate of interest shall be the greater of (a) and (b) where: (a) is 4% per annum up to an including December 31, 1981 and the applicable rate specified as the minimum rate by The Pension Benefits Act thereafter;

and

(b) is the rate of return for the Fund or Previous Plan's fund as applicable as published in the Comparative Measurement Service Report commissioned by the Fringe Benefits Committee of the Plan or Previous Plan as applicable.

Interest shall be credited to such Retroactive Contributions in accordance with Section 3 of this Article.

5. Notwithstanding the previous Sections of this Article, interest on a Member's Additional Voluntary Contributions, paid in accordance with paragraph 2(c), Article III, shall be calculated and applied at the rates, and at the times, provided for by this Section. (a) The rate of interest to be applied shall be:
(i) prior to January 1, 1995, for a complete calendar year, up to 100% of the annual rate of return of the Previous Plan's fund, as published in the Comparative Measurement Service Report commissioned by the Fringe Benefits Committee of the Previous Plan; (ii) on or after January 1, 1995, for a complete calendar year, 100% of the annual net rate of return of the Fund or Previous Plan's fund as applicable, as published in the Comparative Measurement Service Report commissioned by the Fringe Benefits Committee of the Plan or the Previous Plan as applicable, after an allowance for investment and administrative expenses for the Plan; (iii) for the part of the year from the previous Anniversary date to the most recent month-end for which the custodian's reports have been received, up to 100% of the year-to-date earnings rate as provided by the custodian's reports; and (iv) for the part of the year from the month-end to which paragraph (b) applies to the date of payment, up to 100% of the average of the earnings rate for the last three months for which the custodian's reports have been received.
(b) Interest shall be calculated and applied to contributions on a reasonable basis and no less frequently than annually. (c) Interest shall be credited:
(i) in the case of contributions made by regular payroll deduction, for the average period during which they were in the Fund or Previous Plan's fund; and (ii) in the case of contributions made by lump-sum deposit, from the date they were deposited in the Previous Plan's fund. 6. Notwithstanding the provisions of this Article, , interest credited to contributions made by Members and by the University on behalf of Members in respect of the calendar year 1999 shall be determined in accordance with the provisions of Article IV of the Previous Plan.
ARTICLE V CONTINUOUS EMPLOYMENT AND CREDITED SERVICE

1. Continuous Employment

Subject to the following Sections of this Article, a Member's Continuous Employment is his most recent uninterrupted period of employment with the University as a Permanent Employee. Continuous Employment is deemed not to be interrupted by, and continues to accrue during and after, the following:

(a) jury duty; (b) authorized vacations and statutory holidays; (c) service with the armed forces of Canada or its allies, during a period of national emergency provided that the Employee had been employed for at least one year immediately prior to such service, and returned to employment with the University within three months following the end of such service; (d) absence which is authorized by the University; (e) disability if the Member qualifies for benefits under any short-term or long-term disability programs sponsored by the University; (f) breaks in service, not exceeding six months in duration, between termination of employment and re-employment with the University, provided that the Member did not receive a cash refund, in accordance with Article XI (TERMINATION OF SERVICE), in respect of his original period of membership in the Plan.

Continuous Employment shall be interrupted by, and shall cease to accrue during and after, the following:

(a) death; (b) termination of employment with the University except as provided in paragraph (f), above of this Section; (c) retirement; (d) failure to return to regular employment with the University immediately following a period of approved absence, or immediately upon recovery from an approved disability; (e) failure to return to regular employment with the University within three months following the end of approved service with the armed forces of Canada or its allies.

If Continuous Employment is interrupted in accordance with the foregoing, the Member shall be treated as having terminated his active membership in the Plan, and shall be subject to the provisions of Article VII (NORMAL RETIREMENT PENSION), Article VIII (EARLY RETIREMENT PENSION), Article IX (POSTPONED RETIREMENT PENSION), Article XI (TERMINATION OF SERVICE) or Article XIII (DEATH BENEFITS), whichever is appropriate.

2. Credited Future Service Subject to the conditions prescribed by this Section, a Member's Credited Future Service shall be the period of his Continuous Employment, on and after June 30, 1965, during which he made Required Contributions, or in respect of which he made the Retroactive Contributions prescribed by paragraph (b) of Section 2 of Article III, provided that:

(a) if the Member is on approved leave of absence, other than leave of absence in accordance with paragraph (b) of this Section, the period of such absence shall count as Credited Future Service only in the proportion that the actual Required Contributions made by him in such period are of the Required Contributions that would have been made, based on equivalent full-time earnings during such leave of absence.

(b) if the Member's absence is due to a disability in respect of which he receives an income under the Long Term Disability Plan of the University, his contributions and the University's contributions in respect of him, in accordance with Section 2 and 3 of Article III (CONTRIBUTIONS), shall be discontinued. However, the Member's Credited Future Service shall be deemed to accrue in full. (c) if the Member is employed less than full-time, Credited Future Service shall be calculated using the same proportion that actual employment is of full-time employment. (d) whenever Credited Future Service is based on deemed earnings and/or deemed service, other than during periods of disability, the maximum Credited Future Service which can be credited to a Member for: (i) one or more periods of parenting after 1990, shall not exceed three (3) years of equivalent full-time employment; and (ii) one or more periods of temporary absence or reduced pay after 1990, shall not exceed five (5) years of equivalent full-time employment. 3. Credited Past Service Subject to the conditions prescribed by this Section, a Member's Credited Past Service is the period of his Continuous Employment prior to June 30, 1965 during which time he made contributions to the Original Plan and/or contributions were made on his behalf to the University. Any period of Continuous Employment, including Continuous Employment during a Waiting Period, prior to June 30, 1965, during which the Member could not make contributions to the Original Plan, shall be included in the computation of Credited Past Service, provided that the Member pays the Retroactive Contributions prescribed by paragraph (b) of Section 2 of Article III (CONTRIBUTIONS).

It is further provided that:

(a) the period of Credited Past Service which may be included by virtue of the payment of Retroactive Contributions shall be limited to the number of years and fractions thereof which, when added to other Credited Past Service and to the Credited Future Service which would be earned by the Member if he were to continue to make Required Contributions in full up to his Normal Retirement Date, shall produce a total of 35 years of Credited Service;

(b) if, for any reason, a Member has paid some, but not all of the Retroactive Contributions available to him, with Credited Interest thereon, at the time that his Continuous Employment is interrupted, the part of his Credited Past Service which is related to Retroactive Contributions shall be computed with reference to the most recent period which the Retroactive Contributions actually paid will cover, using such methods and procedures as the Fringe Benefits Committee deems equitable in the circumstances; (c) if the Member was employed less than full-time, Credited Past Service shall be calculated using the same proportion that actual employment was of full-time employment. 4. Rules Pertaining to Approved Absence (a) A Member on authorized leave of absence shall remain a Member. (b) If the leave of absence is with full pay (apart from circumstances where disability benefits are received, as set out in paragraph (b) of Section 2 of the Article), the Member shall continue his Required Contributions. He shall be treated as though he was actively at work during such leave of absence, earning his full normal rate of Earnings during such leave of absence. (c) If the leave of absence is Sabbatical or Educational Leave, the Member shall have the option to continue or discontinue his Required Contributions. The Member shall make this election in writing to the Fringe Benefits Committee. If the Member elects to continue his Required Contributions, he shall be treated as though he was actively at work during such leave of absence with Required Contributions and Earnings based on equivalent full-time earnings during such leave of absence. If the Member elects to discontinue his Required Contributions, he shall be treated as if his leave of absence was without pay, in accordance with paragraph (d) of this Section. (d) If the Member's leave of absence is without pay, and the Member is not in receipt of long term disability benefits under the Long Term Disability Plan of the University, no contributions shall normally be made during such absence. With the approval of the Board under special circumstances, contributions and benefit accruals may be continued, subject to paragraph (a) of Section 2 of this Article, to such other terms and conditions as the Board may prescribe, and to the provisions of the Income Tax Act (Canada) and the regulations thereunder. If contributions and benefit accruals are continued they shall be based on equivalent full time earnings during such leave of absence. (e) If the Member's absence is due to disability in respect of which he received an income under the Long Term Disability Plan of the University, then, for all purposes of the Plan, the Member will be deemed to have received Earnings, during such disability, based on his full normal rate of Earnings applicable immediately prior to such period of disability, increased each year by the same cost of