1997

PREMIUM PAYMENT PACKAGE

PENSION BENEFIT GUARANTY CORPORATION

This Package Contains:

PBGC Form 1

Schedule A

1997 Instructions

To All Plan Administrators:

Enclosed are the forms and instructions for 1997 premium payments. As pledged in our Customer Service Plan,

we are issuing the package seven months before each plan’s final filing due date.

Each plan requires a separate Form 1 and a separate check. All premium filings and payments, whether for 1997 or

an earlier year, must be sent to our current filing address (see page iii).

These forms are designed to be read by computer. Please print information clearly within the boxes. The Pension

Benefit Guaranty Corporation can accept only the original specially printed forms in this package or PBGC-approved

forms created with software. We cannot accept photocopies of the forms.

Several changes affect premium payments for 1997 plan years. They are:

Phase-out of Variable Rate Premium Cap

• The per-participant variable-rate premium cap is eliminated.

Increase in Required Interest Rate for Plan Years Beginning On or After July 1, 1997

• The required interest rate for determining unfunded vested benefits for plan years beginning

before July 1, 1997, remains at 80% of the annual yield for 30-year Treasury securities. For plan years

beginning on or after July 1, 1997, the Retirement Protection Act increased the required interest rate from

80% to 85% of the Treasury rate. (See page 21 on how to obtain interest rate information.)

New Policy on Late Payment of Premiums

• The PBGC has adopted a new late-payment penalty policy effective for plan years beginning on or after

January 1, 1996. Under the new policy, late-payment penalties generally will be lower for plans that

correct underpayments before the PBGC issues a written notice that there is or may be a premium

delinquency. For plan years beginning before 1996, PBGC will provide penalty relief for plans that

contact PBGC by April 30, 1997. (See page 9.)

Regulated Public Utility Plans

• See pages 2 and 21.

Thank you for your cooperation.

Martin Slate

Executive Director

Pension Benefit Guaranty Corporation
ii

Pension Benefit Guaranty Corporation

Customer Service Plan for Plan Administrators

What is Our Mission?

The mission of the Pension Benefit Guaranty Corporation (PBGC) is to operate as a service-oriented, professionally

managed agency that protects participants’ pension benefits and supports a healthy retirement plan system. We seek to make the

maximum use of resources and maintain premiums and operating costs at the lowest levels consistent with statutory responsibilities.

Who Are Our Customers and What Services Do We Provide?

As a plan administrator of a pension plan that pays premiums to PBGC, you are one of PBGC’s principal customers.

In administering the premium collection program, we:

• Collect premiums from covered plans;

• Issue annual premium forms and instructions packages;

• Answer questions from plan administrators, sponsors, and practitioners about premium payments;

• Process premium related requests, including requests for refunds and administrative changes;

• Issue past due filing notices and statements of account, as appropriate;

• Make decisions on requests for reconsideration of agency determinations in the premium administration area.

Of course our dealings with plan administrators, plan sponsors, and pension practitioners go beyond premium collections.

Should a defined benefit pension plan terminate, as either a standard or a distress termination, you have dealings with the

PBGC to bring the case to closure.

Priority Areas and Actions for Improving Services

To develop customer service standards, PBGC first asked frontline employees what premium payers want and expect from

PBGC. We used that information to conduct several focus groups of premium payers that identified problems, concerns, and

expectations of importance to those we are in business to serve—the premium payers. The customer service standards PBGC

commits to were derived directly from what our customers told us. Based on that same customer feedback, we have also made

changes to how premium penalties are calculated.

We will periodically survey our customers to see how well we are meeting these customer service standards. If you are

contacted as part of the survey, please take a few minutes to respond so that we know how we are doing and can make necessary changes and improvements to serve you better.

We also will continue to compare how we deliver services to our customers with other organizations in government and

business that perform similar services. This “benchmarking” is a way of continually improving service delivery by actively

looking for those who do it better and following their example.

Standards This is our pledge to you, our customer:

• We will mail the PBGC Form 1 package seven months in advance of each plan’s filing due date.

• We will return your phone call within 24 hours. If we cannot immediately resolve the issue you called about, we will

tell you when you can expect it to be resolved, and we will give you the name and number of the responsible person.

• When you ask for reconsideration of the imposition of a premium penalty, we will acknowledge receipt of your

request within 1 week. We will tell you when to expect a response and include the name and number of a contact person.

• A Problem Resolution Officer will serve as the focal point for complaints from premium payers and their representatives.

Last year PBGC revised its policy on penalties for failure to provide required information (e.g., notices involving standard

terminations and reportable events, and notifications to participants of underfunded plans) in a timely manner, resulting in lower

penalties for plans of smaller businesses and for violations that are speedily corrected. This policy has now been extended to

the premium area. PBGC has also adopted a new late payment policy effective beginning with premium payments for the 1996

plan year that will result in generally lower late payment penalties for plans that correct underpayments before PBGC issues a

written notice that there is or may be a premium delinquency. We are continuing our review of the standard termination

regulation to address the various problems filers have reported to us, including the time periods for filing.

Questions or Complaints

If you have a premium-related question or request, please contact us at (703) 827-3676.

If you have a complaint about the service you have received or still need assistance after calling (703) 827-3676, please

contact:

Pension Benefit Guaranty Corporation

Problem Resolution Officer (Premiums)

1200 K Street, NW (Suite 670)

Washington, DC 20005-4026

Phone: (202) 326-4136

Email: premiums.pro@pbgc.gov

When you write to us, include a telephone number where you can be reached and we will try to respond to you by telephone.
iii

 Send Your Premium Filing and Check to:

Pension Benefit Guaranty Corporation

P.O. Box 64880

Baltimore, MD 21264-4880

For further information, see Part D - ADDRESSES.

If you are correcting a filing, see Part E - HOW TO CORRECT A FILING
iv

Reminder to Single-Employer Plans About Reportable Events

The plan administrator or contributing sponsor may have to notify the PBGC about certain events:

The plan administrator of a single-employer plan that pays a variable-rate premium for the 1997 plan

year may be required to issue a 1997 participant notice about the plan’s funding status and the limits on the

PBGC’s guarantee of benefits. The 1997 participant notice is due two months after the 1996 Form 5500 due

date, including extensions (i.e., during the 1997 plan year).

EXEMPTIONS: A plan that meets the Deficit Reduction Contribution Exception Test for the 1996 or

1997 plan year is exempt from having to provide the 1997 participant notice. Most new and newly-covered

plans are also exempt.

See section 4011 of ERISA and the PBGC’s regulation on Disclosure to Participants (29 CFR Part

4011—formerly Part 2627).

Reminder to Plan Administrators About 1997 Participant Notice

In most cases, notice is required within 30 days after the plan administrator or contributing

sponsor knows or has reason to know that an event has occurred. In certain cases involving

privately-held companies or controlled groups whose pension plans have aggregate unfunded vested

benefits of more than $50 million, the contributing sponsor (but not the plan administrator) must notify

the PBGC 30 days before the effective date of certain events. See section 4043 of ERISA as amended

by section 771 of the Retirement Protection Act of 1994 (RPA) and PBGC’s regulation on Reportable

Events and Certain Other Notification Requirements (29 CFR Part 4043—formerly Part 2615). Failure

to give PBGC timely notice may result in assessment of penalties under section 4071 of ERISA.

NOTE: The PBGC recently adopted amendments to its Reportable Events regulation (61 Federal

Register 63988, December 2, 1996). The amendments address when a reportable event occurs, when

reporting is waived or the reporting date is extended, and what information is required. The PBGC

also issued new forms for notifying PBGC that a reportable event has occurred.

• 20% reduction in active participants

• Failure to make minimum funding payments

• Inability to pay benefits when due

• Excess distributions to a substantial owner

within a 12-month period

• Transfer of 3% or more of benefit liabilities

outside the controlled group

• Application for minimum funding waiver

• Transaction involving a change in

contributing sponsor or controlled group

• Liquidation or dissolution of a contributing

sponsor or a controlled group member

• Declaration of an extraordinary dividend or

stock redemption

• Loan default

• Bankruptcy, insolvency, or similar

settlements with creditors
v

CONTACT POINTS

1. Mail Form 1 and Form 1-ES with your premium

payment(s) to:

Pension Benefit Guaranty Corporation

P.O. Box 64880

Baltimore, MD 21264-4880

or use a delivery service to send Form 1 and

Form 1-ES with your premium payment(s) to:

First National Bank of Maryland

110 South Paca Street

Mail Code: 109-320/Lockbox #64880

Baltimore, MD 21201

The two addresses listed above also apply to amended

premium filings.

2. For general premium-related inquiries, including

requests for forms, assistance on filing forms, and

address changes:

Call .......................(703) 827-3676

Fax ........................ (703) 827-3762

TTY/TDD .............. (202) 326-4179

or write to:

Pension Benefit Guaranty Corporation

P.O. Box 64916

Baltimore, MD 21264-4916

3. For requests for reconsideration of a premium penalty

assessment (on a statement of account) or for requests

for refunds (that are not submitted via premium filing

forms), write to:

Pension Benefit Guaranty Corporation

P.O. Box 64916

Baltimore, MD 21264-4916

4. For current interest rate information:

Call .......................(202) 326-4041

or write to:

Pension Benefit Guaranty Corporation

CPAD

1200 K Street, NW

Washington, DC 20005-4026

5. To contact the National Technical Information Service,

which provides Required Interest Rates and other

PBGC interest rates through a subscription service:

Call ......................... (703) 487-4630

Fax .......................... (703) 321-8547

Order # ................... SUB-9244

or write to:

U.S. Department of Commerce

National Technical Information Service

5285 Port Royal Road

Springfield, VA 22161

6. For assistance on coverage determination or plan

termination:

Call ......................... (202) 326-4000

TTY/TDD ................ (202) 326-4179

or write to:

Pension Benefit Guaranty Corporation

Insurance Operations Department

Standard Termination Compliance Division

ARTAB Suite 930

1200 K Street, NW

Washington, DC 20005-4026

7. If you have a complaint about the service you have

received or still need assistance after calling our general

premium telephone number listed in item 2 (703-827-

3676), please contact the Problem Resolution Officer

(Premiums):

Call ......................... (202) 326-4136

Email....................... premiums.pro@pbgc.gov

or write to:

Pension Benefit Guaranty Corporation

Problem Resolution Officer (Premiums)

Suite 670

1200 K Street, NW

Washington, DC 20005-4026

8. Any vendor requesting approval of automated forms

may send a sample (including 3 original forms) to:

Pension Benefit Guaranty Corporation

P.O. Box 64916

Baltimore, MD 21264-4916

PBGC telephone numbers are not toll free numbers and collect calls cannot be accepted.
vi

1997 Premium Payment Package

Pension Benefit Guaranty Corporation

How To Complete PBGC Premium Payment Forms

PAPERWORK REDUCTION ACT NOTICE

We need this information to determine the amount of premium due to the PBGC under Title IV of ERISA and to

monitor single-employer plans’ compliance with the participant notice requirement in ERISA section 4011 and 29 CFR

Part 4011—formerly Part 2627. You are required to give us this information. An agency may not conduct or sponsor,

and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control

number. OMB has approved this collection of information under control number 1212-0009. Confidentiality is that

supplied by the Privacy Act and the Freedom of Information Act.

The estimated times needed to complete and file the Form 1 and, for single-employer plans, Schedule A are listed

below. These times are averages for the plans in each of the listed categories. These times will vary depending on the

circumstances of a given plan.

 FORM AND PLAN TYPE AVERAGE TIME

Form 1 and Schedule A (Single-Employer Plans)

Plans with Under 500 Participants

Fully funded 29,400 plans 1.0 hour

Underfunded 13,400 plans 1.7 hours

Plans with 500 or More Participants

Fully funded 4,900 plans 1.0 hour

Underfunded 2,300 plans 5.1 hours

Form 1 (Multiemployer Plans) 2,000 plans 0.5 hour

If you have comments concerning the accuracy of these time estimates or suggestions for making the forms simpler, please send your comments to Pension Benefit Guaranty Corporation, Office of the General Counsel, Suite 340,

1200 K Street, NW, Washington, DC 20005-4026.

Contents

Customer Service Plan for Plan Administrators................................................................................................... ii

Reminders .................................................................................................................................................................iv

Contact Points ............................................................................................................................................................ v

Part A INTRODUCTION ...................................................................................................................................... 1

1. What Is PBGC Form 1? .................................................................................................................................................................... 1

2. Definitions ........................................................................................................................................................................................ 1

3. Recordkeeping Requirements; PBGC Audits .................................................................................................................................. 2

Part B WHO MUST FILE .................................................................................................................................... 3

1. General Rule ..................................................................................................................................................................................... 3

2. Terminating Plans ............................................................................................................................................................................. 3

Part C WHEN TO FILE ........................................................................................................................................ 4

1. General Rule ..................................................................................................................................................................................... 4

2. Plans Filing For The First Time ....................................................................................................................................................... 5

3. Plans Filing For The Second Time ................................................................................................................................................... 5

4. Plans Changing Plan Years ............................................................................................................................................................... 6

5. Saturday, Sunday, And Federal Holiday ........................................................................................................................................... 6

6. Postmark Date Is Controlling ........................................................................................................................................................... 6

7. Relationship Between Form 1 And Form 5500 Series ..................................................................................................................... 6
vii

Part D ADDRESSES .............................................................................................................................................. 7

1. Where To File Form 1 And Form 1-ES ............................................................................................................................................ 7

2. Where To Obtain Form 1 And Form 1-ES ....................................................................................................................................... 7

3. Where To Get Help In Filing The Form 1 Or Form 1-ES ................................................................................................................ 8

4. Where To Get A Coverage Determination ....................................................................................................................................... 8

Part E HOW TO CORRECT A FILING.............................................................................................................8

1. Check Without A Form 1 Or Form 1-ES ......................................................................................................................................... 8

2. Form Without A Check .................................................................................................................................................................... 8

3. Amended Filing—Premium Underpayment ..................................................................................................................................... 8

4. Amended Filing—Premium Overpayment ....................................................................................................................................... 8

5. How To Correct An Address ............................................................................................................................................................ 8

Part F LATE PAYMENT CHARGES .................................................................................................................. 9

1. Interest Charges ................................................................................................................................................................................ 9

2. Penalty Charges ................................................................................................................................................................................ 9

3. PBGC Waivers ................................................................................................................................................................................. 10

4. IRS Extension For Form 5500 ........................................................................................................................................................ 10

5. Minimizing Late Payment Charges ................................................................................................................................................. 10

Part G ITEM-BY-ITEM INSTRUCTIONS FOR FORM 1 ............................................................................. 10

Part H GENERAL INSTRUCTIONS FOR SCHEDULE A............................................................................. 15

1. General Requirements ..................................................................................................................................................................... 15

2. Failure To File Schedule A .............................................................................................................................................................. 15

3. Computation Date For The Variable Rate Premium ........................................................................................................................ 15

4. Filing Methods ................................................................................................................................................................................ 16

5. Requirements For Filing Method Selection .................................................................................................................................... 16

a. General Rule. .......................................................................................................................................................................... 16

b. Alternative Calculation Method ............................................................................................................................................. 17

c. Plans Exempt From Variable Rate Premium .......................................................................................................................... 18

(i) Plans With No Vested Participants .............................................................................................................................. 18

(ii) Section 412(i) Plans .................................................................................................................................................... 18

(iii) Fully Funded Small Plans............................................................................................................................................ 18

(iv) Plans Terminating In Standard Terminations .............................................................................................................. 19

(v) Plans At The Full Funding Limit ................................................................................................................................ 19

d. Plans Terminating In Distress Or Involuntary Terminations .................................................................................................. 20

e. Small Regulated Public Utility Plans Paying Maximum Variable Rate Premium ................................................................. 20

6. Significant Events ............................................................................................................................................................................ 20

7. Required Interest Rate For Valuing Vested Benefits ....................................................................................................................... 21

8. Certification Of Plan Administrator ................................................................................................................................................ 22

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A .................................................................... 22

Subpart 1 General Rule ........................................................................................................................................................................ 23

Subpart 2 Alternative Calculation Method .......................................................................................................................................... 25

Subpart 3 No Vested Participants ........................................................................................................................................................ 29

Subpart 4 Section 412(i) Plans ............................................................................................................................................................ 29

Subpart 5 Fully Funded Small Plans ................................................................................................................................................... 29

Subpart 6 Standard Terminations ......................................................................................................................................................... 29

Subpart 7 Plans At The Full Funding Limit ........................................................................................................................................ 29

Subpart 8 Plans Terminating In Distress Or Involuntary Terminations ............................................................................................... 30

Subpart 9 Small Regulated Public Utility Plans Paying Maximum Variable Rate Premium .............................................................. 31

APPENDIX A Optional Substitution Factors for the term “94(RIR - BIR)” ..........................................................32

TABLE A ............................................................................................................................................................................................. 32

TABLE B ............................................................................................................................................................................................. 33

APPENDIX B Codes for Principal Business Activity and Principal Product or Service................................ 34

VARIABLE RATE WORKSHEET .......................................................................................................................37

REQUIRED INTEREST RATE WORKSHEET ................................................................................................. 38

BULK MAILING ORDER FORM ........................................................................................................................39
viii

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1

Part A INTRODUCTION

1. What Is PBGC Form 1?

The Form 1 (including Schedule A to Form 1) is a

form used to pay premiums to the Pension Benefit

Guaranty Corporation (PBGC) as required by sections

4006 and 4007 of the Employee Retirement Income

Security Act, as amended (ERISA), and the PBGC’s

premium regulations (29 CFR Parts 4006 and 4007—

previously designated Part 2610).

The 1997 Premium Payment Package forms are in

Optical Character Recognition (OCR) format. This will

enable PBGC to process your plan information quickly

and accurately. For this reason, we cannot accept photocopies of the forms. PBGC will accept the original forms

provided in this package or forms provided by a vendor

that has received PBGC approval for an automated

(computer generated) version of the form. The OCR

process requires that you print data clearly within the

boxes provided on the forms.

Any vendor requesting approval of automated forms

may send a sample to Pension Benefit Guaranty Corporation, P.O. Box 64916, Baltimore, MD 21264-4916.

Include 3 original forms produced by your software and a

brief note requesting PBGC review of the forms.

The Form 1-ES (which is issued in a separate

booklet) is used by all plans that reported 500 or more

participants on their 1996 PBGC Form 1 to make their

initial 1997 premium payments (only the flat rate premium for single-employer plans) and permits the initial

premium calculations to be based on an estimated

participant count. These plans use the Form 1 to make a

subsequent reconciliation filing based on an actual

participant count and, for single-employer plans, to pay

the variable rate premium. (NOTE: If all the information

needed to file Form 1 is known before the First Filing

Due Date, you may file a Form 1 instead of a Form 1-ES.

If you file a Form 1-ES, you will still be required to file a

Form 1 by the Final Filing Due Date.) Plans with fewer

than 500 participants for the prior filing year file the

Form 1 only, with their total premium payment, by the

Final Filing Due Date.

It is the responsibility of the plan administrator to

obtain and complete the Form 1 and Form 1-ES, as

applicable, and make the premium payment each year.

Any signatures or initials required from the plan administrator or enrolled actuary must be filed in original form.

The instructions in this booklet describe how to complete

Form 1 and make the premium payment due.

2. Definitions

In these instructions—

“ERISA” means the Employee Retirement Income

Security Act of 1974, as amended (29 U.S.C. 1001, et seq.).

“Code” means the Internal Revenue Code of 1986,

as amended.

“First Filing Due Date” means the last day of the

2nd full calendar month following the close of the

preceding plan year, except that, in the case of plans

changing plan years, it is the later of the last day of the

2nd full calendar month following the close of the

preceding plan year or 30 days following the date on

which a plan amendment changing the plan year was

adopted. See Part C for plans that must file a Form 1-ES

on a “First Filing Due Date.”

“Final Filing Due Date” means the 15th day of the

8th full calendar month following the month in which the

plan year began except:

a. In the case of plans filing for the first time it is

the latest of the following dates—

(i) the 15th day of the 8th full calendar month

following the month in which the plan year began,

or if later, in which the plan became effective for

benefit accruals for future service,

(ii) 90 days after the date of the plan’s adoption, or

(iii) 90 days after the date on which the plan became

covered under ERISA section 4021.

b. In the case of plans changing plan years, it is the

later of the 15th day of the 8th full calendar month

following the month in which the plan year began, or 30

days after the date on which a plan amendment was

adopted changing the plan year.

See Part C for plans that must file a Form 1 on a

“Final Filing Due Date.”

“Filing Due Date” means either the First Filing Due

Date or the Final Filing Due Date defined above.

“Form 1” means the Annual Premium Payment

Form 1 issued by the PBGC and includes, for singleemployer plans, the Schedule A.

“Form 1-ES” means the Estimated Premium

Payment Form 1-ES issued by the PBGC (in a separate

booklet) for estimating the flat rate premium for singleemployer plans and the total premium for multiemployer

plans.

“Schedule A” means the schedule to the Form 1

which is used by single-employer plans to calculate

unfunded vested benefits and compute the variable rate

premium.

“Flat rate premium” means the portion of the singleemployer premium determined by multiplying the flat

rate premium charge by the number of participants in the

plan on the last day of the preceding plan year or, for a

new or newly covered plan, the first day of the current

plan year. The flat rate charge for single-employer plans

for plan years beginning in 1997 is $19 per participant.

“Variable rate premium” means the portion of the

single-employer premium based on a plan’s unfunded

vested benefits. The variable rate premium for plan years

beginning in 1997 is $9 for every $1,000 (or fraction

thereof) of unfunded vested benefits. The variable rate

premium previously was capped at $53 per participant.

Part A INTRODUCTION
2

Part A INTRODUCTION

Except as provided for Regulated Public Utility Plans

(see below), the cap no longer applies.

“Premium payment year” means the plan year for

which the premium is being paid.

“Premium regulations” means the PBGC’s regulations on Premium Rates and Payment of Premiums (29

CFR Parts 4006 and 4007—previously designated Part

2610). The Form 1-ES and Form 1 and these instructions

are issued under and implement the premium regulations.

“Regulated Public Utility” means a regulated public

utility that:

a. is described in section 7701(a)(33)(A)(i) of the

Code, and

b. has not begun to collect from utility customers

rates that reflect the costs incurred or projected to be

incurred for additional premiums under section

4006(a)(3)(E) of ERISA pursuant to final and

nonappealable determinations by all public utility

commissions (or other authorities having jurisdiction

over the rates and terms of service by the regulated

public utility) that the costs are just and reasonable and

recoverable from customers of the regulated public

utility.

“Regulated Public Utility Plan” means a plan that,

on the first day of the premium payment year, is maintained by a contributing sponsor or sponsors at least one

of which is a Regulated Public Utility. In general, the

$53 per-participant variable rate cap continues to apply to

Regulated Public Utility Plans. However, the $53 perparticipant cap is proportionately applied if a Regulated

Public Utility Plan:

a. is maintained by any contributing sponsor that is

not a Regulated Public Utility, and

b. covers any participant who is not a Regulated

Public Utility participant (determined under any reasonable method consistently applied among participants and

from year to year). (See the Variable Rate Worksheet on

page 37.)

Regulated Public Utility Plans with premium

payment years beginning after June 30, 1997, must use

special rules for determining the required interest rate

that is used to determine unfunded vested benefits. (See

instructions on page 21 and the Required Interest Rate

Worksheet on page 38.)

“Form 5500 series” means Form 5500 and 5500 C/R,

Annual Return/Report of Employee Benefit Plan, jointly

developed by the Internal Revenue Service, the Department of Labor, and the PBGC. (Copies of this form may

be obtained from the Internal Revenue Service or the

Department of Labor.)

“We” or “us” means the Pension Benefit Guaranty

Corporation.

“You” or “your” means the administrator of a

pension plan.

“Plan administrator” means:

a. the person specifically so designated by the terms

of the instrument under which the plan is operated; or

b. if an administrator is not so designated, the plan

sponsor.

“EIN” means Employer Identification Number. It is

always a 9-digit number assigned by the Internal Revenue Service for income tax purposes.

“PN” means Plan Number. This is always a 3-digit

number. The plan sponsor assigns this number to

distinguish among employee benefit plans established or

maintained by the same plan sponsor. A plan sponsor

usually starts numbering pension plans at “001” and uses

consecutive Plan Numbers for each additional plan.

Once a PN is assigned, always use it to identify the same

plan. If a plan is terminated, retire the PN - do not use it

for another plan.

3. Recordkeeping Requirements; PBGC Audits

Plan administrators are required to retain all plan

records that are necessary to support or validate PBGC

premium payments. The records must include calculations and other data prepared by the plan’s actuary or, for

a plan described in section 412(i) of the Internal Revenue

Code, by the insurer from which the insurance contracts

are purchased. The records are to be kept for six years

after the premium due date.

Records that must be retained include, but are not

limited to, records that establish the number of plan

participants and that reconcile the calculation of the

plan’s unfunded vested benefits with the actuarial

valuation upon which the calculation was based.

Records retained pursuant to this paragraph must be

made available to the PBGC upon request for inspection

and photocopying.

The PBGC may audit any premium payment. If

PBGC determines upon audit that the full amount of the

premium due was not paid, late payment interest charges

under §4007.7 of the premium regulations and late

payment penalty charges under §4007.8 of the premium

regulations will apply to the unpaid balance from the

premium due date to the date of payment. If, in the

judgment of the PBGC, the plan’s records fail to establish the number of participants with respect to whom

premiums were required for any premium payment year,

the PBGC may rely on data it obtains from other sources

(including the Internal Revenue Service and the Department of Labor) for presumptively establishing the

number of plan participants for premium computation

purposes. Similarly, if, in the PBGC’s judgment, the

plan’s records fail to establish that the unfunded vested

benefits were the amount reported in the premium filing,

the PBGC may rely on data it obtains from other sources

for estimating the amount of unfunded vested benefits for

premium computation purposes.

Under section 4071 of ERISA, we may assess a

penalty of up to $1,000 per day for failure to furnish

premium-related information by required due dates.
3

Part B WHO MUST FILE

Part B WHO MUST FILE

1. General Rule

The plan administrator of each single-employer plan

and multiemployer plan covered under section 4021 of

ERISA is required annually to file the Form 1 and, if

applicable, Form 1-ES, and pay the premium due. If you

are uncertain whether your plan is covered under section

4021, you should promptly request a coverage determination by writing to us at the address shown in Part D,

Item 4. A request for a coverage determination does not

extend the due date for any premium that is finally

determined to be due. If we determine that the plan is

not a covered plan, we will review the plan’s premium

payments to determine whether any refunds may be

made.

2. Terminating Plans

a. Obligation To File. The obligation to file the

PBGC Form 1 and Form 1-ES and make the required

premium payments continues until the end of the plan

year in which (1) all plan assets are distributed pursuant

to the plan’s termination, or (2) a trustee for the terminating plan is appointed under ERISA section 4042.

b. Refunds. Any required premium payments are

for a full plan year. You may not prorate the premium for

the plan’s final (short) plan year. However, you may

request a refund for that plan year. The PBGC will

determine the amount of the refund by prorating the

premium for the short plan year on a monthly basis

(treating a part of a month as a full month). For this

purpose, the PBGC will treat the short plan year as

ending on—

(i) for a multiemployer plan that distributed all its

assets pursuant to section 4041A of ERISA, the date

the distribution is completed; or

(ii) for a single-employer plan, the earlier of the

dates described in (A) or (B) below:

(A) the date on which the distribution of the

plan’s assets was completed, or, if later, the date

30 days prior to the date the PBGC received

the plan’s post-distribution certification;

(B) the date that a trustee for the terminating

plan was appointed under ERISA section 4042.

To request a refund, write promptly, under separate

cover, to the address shown in Part D, Item 2. Enclose a

copy of the Form 1 that you filed. We will calculate the

amount of your refund.

If a plan terminates and a new plan is established,

premiums are due for the terminated plan as described

above, and premiums are also due for the new plan from

the first day of its first plan year (see Part C, Item 2).

 A plan with a calendar plan year terminates

in a standard termination on September 30, 1996. On

April 8, 1997, all assets are distributed and the PBGC is

notified within 30 days. Since the terminating plan is

sufficient to pay all benefit liabilities, no trusteeship is

involved. The plan administrator must file and make the

premium payments for the 1996 plan year and for the

1997 plan year. However, the plan administrator may

request a refund for the short 1997 plan year, January 1,

1997 - April 8, 1997. A refund will be made for the

period of May - December 1997.

 A plan with a plan year beginning July 1

and ending June 30 terminates in a distress termination

on April 29, 1997. On July 31, 1997, a trustee is appointed to administer the plan under ERISA section

4042. Premium forms and payments must be filed for

this plan for both the 1996 and 1997 plan years, because

a trustee was not appointed until after the beginning of

the 1997 plan year. However, a refund may be requested

for the short 1997 plan year, July 1, 1997 - July 31, 1997.

A refund will be made for the period of August 1997 -

June 1998.
4

Part C WHEN TO FILE

Part C WHEN TO FILE

1. General Rule

The following tables show the filing due dates for

the 1997 premium payment year.

1997 Form 1

Final Filing Due Dates

Premium Form 1

Payment Filing

Year Due

Begins Dates

Jan 1997 09/15/97

Feb 1997 10/15/97

Mar 1997 11/17/97

Apr 1997 12/15/97

May 1997 01/15/98

Jun 1997 02/17/98

Jul 1997 03/16/98

Aug 1997 04/15/98

Sep 1997 05/15/98

Oct 1997 06/15/98

Nov 1997 07/15/98

Dec 1997 08/17/98

1997 Form 1-ES

Filing Due Dates

Premium Form 1-ES

Payment Filing

Year Due

Begins Dates

01/01/97 02/28/97

01/02 - 02/01/97 03/31/97

02/02 - 03/01/97 04/30/97

03/02 - 04/01/97 06/02/97

04/02 - 05/01/97 06/30/97

05/02 - 06/01/97 07/31/97

06/02 - 07/01/97 09/02/97

07/02 - 08/01/97 09/30/97

08/02 - 09/01/97 10/31/97

09/02 - 10/01/97 12/01/97

10/02 - 11/01/97 12/31/97

11/02 - 12/01/97 02/02/98

12/02 - 12/31/97 03/02/98

Your due date for filing the Form 1 and, if applicable, Form 1-ES and paying the premium owed depends

on the number of plan participants as of the last day of

the second plan year preceding the premium payment

year. This number is the participant count required to be

reported on the Form 1 for the plan year preceding the

year for which you make the filing (i.e., for 1997

premiums, the participant count on the 1996 Form 1).

NOTE: The participant count date for purposes of

determining your Filing Due Date is different from the

participant count date used for computing the premium

(see Part G).

Plans that were required to report 500 or more

participants on the preceding year’s Form 1 must generally file a Form 1-ES by the last day of the second full

calendar month following the close of the preceding plan

year (“First Filing Due Date”) and a Form 1 by the 15th

day of the eighth full calendar month following the

month in which the plan year began (“Final Filing Due

Date”). For single-employer plans, only the flat rate

premium is due by the First Filing Due Date; the variable

rate premium is due by the Final Filing Due Date. For

multiemployer plans, the entire premium is due by the

First Filing Due Date.

Plans that reported fewer than 500 participants on

the preceding year’s Form 1 are required to file the

Form 1 and pay the entire premium due by the 15th day

of the 8th full calendar month following the month in

which the plan year began.

The premium owed for a plan year is based on the

number of plan participants as of the last day of the

preceding plan year. However, plans may not have an

accurate participant count before the First Filing Due

Date. For this reason, the Form 1-ES permits plans to

compute the amount owed on the basis of an estimated

participant count. However, we remind you that for

plans with 500 or more participants, the total flat rate

premium, in the case of a single-employer plan, or the

entire premium, in the case of a multiemployer plan, is

due by the First Filing Due Date. If the full amount due

is not paid by that date, the plan will be subject to late

payment interest charges and may also be subject to late

payment penalty charges (see Part F).

You may avoid a late payment penalty charge (but

not the interest) (see Part F) for the flat rate premium if

you do two things:

a. First, you must pay 100 percent of the premium

amount due on the plan’s Final Filing Due Date for the

$19 per participant flat rate single-employer premium

or the $2.60 per participant multiemployer total

premium; and

b. Second, the premium based on an estimated

participant count that you pay with the Form 1-ES by the

First Filing Due Date must equal at least the lesser of:

(i) 90 percent of the premium amount due on the

plan’s Final Filing Due Date for the $19 per participant flat rate single-employer premium or the $2.60

per participant multiemployer premium, or

(ii) an amount equal to the participant count for the

PBGC Form 1 for the year before this premium

payment year multiplied by $19 for single-employer

plans and $2.60 for multiemployer plans.

If you have an accurate participant count by the First

Filing Due Date, you should pay the amount owed by

that date. If you do this, you will avoid the interest and

penalty charges. If you have all the information needed
5

Part C WHEN TO FILE

to file Form 1 on or before the First Filing Due Date, you

should file a Form 1. If you file a Form 1-ES, you will

still be required to file a Form 1 by the Final Filing Due

Date. (A single-employer plan that files a Form 1 with

its first payment, but does not include the variable rate

portion of the premium, will have to file another Form 1,

identified as an “Amended Filing,” with that payment by

the Final Filing Due Date.)

2. Plans Filing For The First Time

a. First Filing Due Date. New and newly covered

plans are not required to pay an estimated premium by a

First Filing Due Date.

b. Final Filing Due Date. For all new and newly

covered plans, regardless of the number of plan participants, that have NOT previously been required to file a

Form 1 and pay premiums to us, the Final Filing Due

Date is the latest of the following dates:

(i) the 15th day of the 8th full calendar month

following the month in which the plan year began,

or if later, following the month in which the plan

first became effective for benefit accruals for future

service (see Examples 1 and 2),

(ii) 90 days after the date of the plan’s adoption (see

Example 3), or

(iii) 90 days after the date on which the plan became

covered under ERISA section 4021 (see Example 4

below).

c. Refunds. Any required premium payments are

for a full plan year. Thus, you must pay a full year’s

premium payment for the plan’s first plan year, even if it

is a short plan year (e.g., a new plan maintained on a

calendar year basis becomes effective for benefit accruals

for future service on July 1, 1997). However, you may

request a refund for the plan’s first (short) plan year by

writing promptly, under separate cover, to the address

shown in Part D, Item 2. Enclose a copy of the Form 1

that you filed. We will calculate the amount of the

refund by prorating the premium for the short plan year

on a monthly basis (treating a part of a month as a full

month).

 A new plan has a calendar plan year. The

plan was adopted October 1, 1996, and became effective

for benefit accruals January 1, 1997. The Final Filing

Due Date for the 1997 plan year is September 15, 1997.

 A new plan is adopted on December 1,

1997, and has a July 1 - June 30 plan year. The plan

became effective for benefit accruals for future service

on December 1, 1997. The Final Filing Due Date for the

plan’s first year, July 1, 1997, through June 30, 1998, is

August 17, 1998. The plan owes a premium for all of

1997, and may request a refund for the period of July

1997 through November 1997.

 A new plan has a calendar plan year. The

plan was adopted on September 15, 1997, with a retroactive effective date of January 1, 1997. The Final Filing

Due Date for the 1997 plan year is December 15, 1997.

 A professional service employer maintains

a plan with a calendar plan year. If this type of plan has

always had fewer than 25 participants it is not a covered

plan under ERISA section 4021. On October 15, 1997,

the plan, which always had under 25 participants, has 26

participants. It is now a covered plan and will continue

to be a covered plan regardless of the plan’s future

participant count. The Final Filing Due Date for the

1997 plan year is January 13, 1998.

3. Plans Filing For The Second Time

The due date rules for plans filing for their second

(or second covered) plan year are the same as the

General Rule under Item 1, with one exception. For

these plans, the determination of whether the plan has

500 or more participants is made as of the first day of the

preceding plan year, i.e., the first day of the plan’s first

(or first covered) plan year. For plans in their second

premium payment year, this is the participant count

required to be reported on the preceding year’s Form 1.

 A single-employer plan has a plan year

beginning on July 1 and ending on June 30. It had a

participant count of 950 as of the first day of its first year,

July 1, 1996. The First Filing Due Date for the plan’s

1997 (its second) plan year is September 2, 1997, and the

plan must generally file a Form 1-ES by that date, using

an estimated participant count for determining the flat

rate premium. The plan must file its Form 1 and pay any

outstanding balance of the flat rate premium plus the

variable rate premium by the Final Filing Due Date,

which is March 16, 1998.

 A multiemployer plan has a plan year

beginning on July 15 and ending on July 14. It had a

participant count of 1,500 as of the first day of the plan’s

first year, July 15, 1996. The First Filing Due Date for

the plan’s 1997 (its second) plan year is September 30,

1997, and the plan must generally file a Form 1-ES on

that date, using an estimated participant count for

determining the amount of the premium. The plan must

make a final, reconciliation filing on Form 1 by the Final

Filing Due Date, which is March 16, 1998.

 A plan had a participant count of 300 as of

the first day of the plan’s first year. This plan has a plan

year beginning on April 1 and ending on March 31. For

the plan year beginning April 1, 1997 (its second plan

year), the plan must file Form 1 by the Final Filing Due

Date, which is December 15, 1997.
6

Part C WHEN TO FILE

4. Plans Changing Plan Years

a. Due Dates. A plan that changes its plan year as

the result of a plan amendment must, for the short plan

year, follow the due date rules described in Part C, Items

1, 2, and 3 above, as applicable.

(i) For the plan year following the short plan year,

the First Filing Due Date is the later of:

(A) the last day of the second full calendar

month following the close of the short plan

year, or

(B) 30 days after the date on which the plan

amendment changing the plan year is adopted.

(ii) For the plan year following the short plan year,

the Final Filing Due Date is the later of:

(A) the 15th day of the 8th full calendar month

following the month in which the plan year

begins, or

(B) 30 days after the date on which the plan

amendment changing the plan year is adopted.

b. Refunds. Each plan year’s premium filing(s) and

payment(s) must reflect and be based on a full 12-month

plan year. You may not prorate the premium for the short

plan year. When a change in plan year resulting from a

plan amendment results in a duplicate or overlapping

premium payment, you may request a refund. To request

a refund, write promptly, under separate cover, to the

address shown in Part D, Item 2. Enclose copies of the

relevant Forms 1 that you filed. We will then calculate

the amount of your refund by prorating the premium for

the short plan year on a monthly basis (treating a part of a

month as a full month).

 By plan amendment adopted on December

1, 1996, a plan changes from a plan year beginning

January 1 to a plan year beginning June 1. This results in

a short plan year beginning January 1, 1997, and ending

May 31, 1997. The plan always has fewer than 500

participants. The Final Filing Due Date for the short plan

year is September 15, 1997. The Final Filing Due Date

for the new plan year beginning on June 1, 1997, is

February 17, 1998. The plan owes a full year’s premium

for the short plan year, and may request a refund for the

period June through December of 1997.

 By plan amendment adopted on October 1,

1997, and made retroactively effective to February 1,

1997, a plan changes from a plan year beginning on

January 1 to a plan year beginning on February 1. The

plan always has fewer than 500 participants. The Final

Filing Due Date for the plan year that began on January

1, 1997, is September 15, 1997. The Final Filing Due

Date for the new plan year, which began February 1,

1997, is October 31, 1997. The plan owes a full year’s

premium for the short plan year, and may request a

refund for the period February through December of

1997.

 By plan amendment adopted on June 1,

1997, and made retroactively effective to April 1, 1997, a

plan changes from a plan year beginning January 1 to a

plan year beginning April 1. The plan always has 500 or

more participants. The First Filing Due Date for the

short plan year is February 28, 1997, and the Final Filing

Due Date is September 15, 1997. The First Filing Due

Date for the new plan year, which began April 1, 1997, is

July 1, 1997, which is the later of the end of the second

full calendar month after the close of the short plan year

or 30 days after adoption of the plan amendment. The

Final Filing Due Date is December 15, 1997. The plan

owes a full year’s premium for the short plan year, and

may request a refund for the period April through

December of 1997.

5. Saturday, Sunday, And Federal Holiday

a. Filing Due Dates. In computing any period of

time described in the premium regulations and these

instructions, the day of the event or default from which

the period of time begins to run is not counted. The last

day of the period is counted, unless it falls on a Saturday,

Sunday or Federal holiday, in which case the period runs

until the end of the next day which is not a Saturday,

Sunday, or Federal holiday.

 Plans with plan years beginning on June 1,

1997, normally would have a Final Filing Due Date of

February 15, 1998. Because that day is a Sunday and the

following Monday is a Federal holiday, the due date is

Tuesday, February 17, 1998.

b. Interest and Penalty Charges. When computing

late payment interest and penalty charges, Saturdays,

Sundays, and Federal holidays are included.

6. Postmark Date Is Controlling

We will consider that you filed Form 1 and your

premium payment on the date on which the mailing

envelope is postmarked by the United States Postal

Service. If the envelope does not contain a legible Postal

Service postmark, we will consider that you filed the

form and payment on the date that is three days before

the date on which we received it. We will disregard any

private postage meter date.

7. Relationship Between Form 1 And

Form 5500 Series

a. Due Dates. For many plans, the deadline for

filing the Form 1 and the Form 5500 series may coincide.

This occurs when a corporate plan sponsor takes the

automatic 6-month extension for filing its corporate tax

return. This extension automatically extends the due date

for filing the Form 5500 series to the tax return due date.

NOTE: Extensions of time to file the Form 5500 series

do not extend the Filing Due Dates for the PBGC forms.
7

 A calendar year plan has a Final Filing Due

Date for the Form 1 of September 15. The corporate tax

deadline for a calendar year tax year is March 15 and the

corporate plan sponsor takes the automatic extension to

September 15. This would make the due date for the

Form 5500 series (which is normally July 31 for a

calendar year plan) also September 15.

b. Participant Count. Further, the participant count

for premium computation purposes for the PBGC Form 1

and the participant count for the Form 5500 series filed

in the same year (1997 Form 1 and 1996 Form 5500) are

generally determined as of the same date, i.e., the last day

of the plan year preceding the year of the filing, and

therefore, these numbers may be the same. (But see Part

G, Item 13(b).)

c. Plan Years Covered By Forms. However, there

is a CRITICAL DIFFERENCE between the two filings.

The Form 1 is filed for the current plan year and the

Form 5500 series is filed for the previous plan year.

Part D ADDRESSES

1. Where To File Form 1 And Form 1-ES

a. Mail Service. Mail Form 1 and Form 1-ES with

your premium payment(s) to:

Pension Benefit Guaranty Corporation

P.O. Box 64880

Baltimore, MD 21264-4880

Do not use this address for any purpose except to

mail Form 1, Form 1-ES, and your premium payment(s).

b. Delivery Service. Alternatively, if you use a

delivery service that does not deliver to a P.O. Box, the

Form 1 and Form 1-ES, along with your premium

payment, may be hand-delivered to:

First National Bank of Maryland

110 South Paca Street

Mail Code: 109-320/Lockbox #64880

Baltimore, MD 21201

2. Where To Obtain Form 1 And Form 1-ES

a. PBGC Mailing. We will mail a 1997 Premium

Payment Package containing a Form 1 and a Schedule A,

and, as appropriate, a 1997 Estimated Premium Payment

Package, to the plan administrator of each plan for which

a 1996 Form 1 was filed. We will mail these forms to the

address shown in Item 2 of the Form 1 seven months

before the expected Filing Due Date.

b. Computer Generated Forms. The PBGC does

not accept photocopies of Form 1, Schedule A, and

Form 1-ES. There are some companies that will provide

software that generates PBGC-approved forms. These

forms have been given a 6-digit approval number that

appears on each form. These forms are acceptable for

submission.

c. Form Requests.

(i) Plan Administrator. If you do not receive a

Premium Payment Package and/or Estimated

Premium Payment Package, it is your responsibility

to obtain it. To do so, or if you need extra copies,

contact:

Pension Benefit Guaranty Corporation

P.O. Box 64916

Baltimore, MD 21264-4916

Phone: (703) 827-3676

TTY/TDD: (202) 326-4179

These are not toll-free numbers. We cannot accept

collect calls.

You may also obtain extra copies of the

Premium Payment Package and/or Estimated

Premium Payment Package and forms from the

Pension and Welfare Benefits Administration of the

U.S. Department of Labor (see addresses following

the instructions).

Part D ADDRESSES
8

(ii) Pension Practitioner. If you are a pension

practitioner serving many covered plans, you may

wish to receive a bulk shipment of the Premium

Payment Package and/or Estimated Premium

Payment Package and forms. If so, complete the

order blank at the end of this Premium Payment

Package. Check the appropriate box at the bottom

of the order blank.

d. Forms For Prior Years. If you are filing for a

previous year, you must use the proper year’s form(s).

To obtain the form(s), you may use the Premium

Payment Package Order Form at the end of this

package or call (703) 827-3676 or fax your order form

to (703) 827-3762.

3. Where To Get Help In Filing The

Form 1 Or Form 1-ES

If you have questions about the single-employer

variable rate premium or other premium-related questions

or requests, you should contact us at the address or phone

number given in Item 2 above. This address should also

be used to submit requests for reconsideration of penalty

assessed (on a statement of account) and requests for

refunds (other than those that are part of a premium

filing).

4. Where To Get A Coverage Determination

If you have any questions concerning whether your

plan is covered or wish to obtain a coverage determination, promptly contact:

Pension Benefit Guaranty Corporation

Insurance Operations Department

Standard Termination Compliance Division

ARTAB Suite 930

1200 K Street, NW

Washington, DC 20005-4026

Phone: (202) 326-4000

TTY/TDD: (202) 326-4179

These are not toll-free numbers. We cannot accept

collect calls.

Part E HOW TO CORRECT A FILING

1. Check Without A Form 1 Or Form 1-ES

If you sent in your check without the Form 1 or

Form 1-ES, as applicable, send the correct form to the

address shown in Part D, Item 1.

2. Form Without A Check

If you sent us Form 1 or Form 1-ES without enclosing your check, you should send the check as soon as

possible to minimize late payment charges. Enclose your

check with a copy of the original form and mail them to

the address shown in Part D, Item 1.

3. Amended Filing—Premium Underpayment

If you discover after you have filed the 1997 Form 1

and Schedule A with us that you have made an error in

your participant count or in the calculation of the variable

rate premium due, you must use an original PBGCprinted form (extra forms are included in this booklet), or

PBGC-approved forms generated with software, to

correct your filing. (Underpayment in an earlier year

must be corrected using the form(s) for that specific year.

See Part D, Item 2.d., for information on obtaining an

earlier year’s form(s).) Check the box in the heading of

the Form 1 to indicate that this is an amended filing. (On

prior years’ forms without an “Amended Filing” box,

print or type “Amended Filing” at the top of the form.)

Fill in the Form 1 and Schedule A as you would for your

annual filing. Enter the correct total in Item 15(a) for the

flat rate premium and the correct variable rate premium

in Item 15(b) and enter the total of Items 15(a) and 15(b)

in Item 15(c). (For multiemployer plans, enter the

corrected premium amount in Item 14.) Subtract from

this result the amount previously paid as shown in Item

16 and enter the difference in Item 17(a). Write the

amount of your check for the net amount of the premium

due on line 17(b) of Form 1. Mail your amended

Form 1 and Schedule A and check to the address

shown in Part D, Item 1.

4. Amended Filing—Premium Overpayment

If you discover after you have filed the 1997 Form 1

and Schedule A with us that you overpaid your premium,

follow the instructions in Item 3, except that the difference between the amount owed and the amount previously paid should be entered in Item 18. Also, you must

check the box in Item 18 if you want this amount refunded. Mail your amended Form 1 and Schedule A

promptly to the address shown in Part D, Item 1.

5. How To Correct An Address

See Part G, Items 1 and 2 if you need to correct your

address or the plan sponsor’s address and are doing so at

the same time you are making your premium filing.

Part E HOW TO CORRECT A FILING
9

However, to keep our records current and to ensure

that your forms will be mailed to the correct address, you

should provide us with your current address as soon as a

change has occurred. You may do so by contacting us

either in writing or by phone using the information found

in Part D, Item 2.

Part F LATE PAYMENT CHARGES

If we receive a premium payment after the Filing

Due Date, we will bill the plan for the appropriate Late

Payment Charges. The charges include both interest and

penalty charges. The charges are based on the outstanding premium amount due on the Filing Due Date.

1. Interest Charges

The Late Payment Interest Charge is set by ERISA

and cannot be waived by us. The interest rate charged is

established periodically (currently on a quarterly basis)

and the interest rates are published on or about the 15th

of January, April, July, and October in the Federal

Register. The rates are also posted on the PBGC’s World

Wide Web site (http://www.pbgc.gov).

Late Payment Interest Charges will be assessed for

any premium amount not paid when due, whether

because of an estimated participant count or an erroneous

participant count or other mistake in computing the

premium owed.

2. Penalty Charges

The Late Payment Penalty Charge is established by

us, subject to ERISA’s restriction that the penalty not

exceed 100 percent of the unpaid premium amount. In

the past, the penalty has been 5 percent of the unpaid

amount for each month (or portion of a month) it remains

unpaid. Starting with 1996 plan years, the Late Payment

Penalty Charge is lower for premium underpayments that

are “self-corrected.” The penalty rate is 1% of the late

premium payment per month if the late payment is made

on or before the date when the PBGC issues a written

notification indicating that there is or may be a premium

delinquency (e.g., a statement of account, past-due-filing

notice, or letter initiating an audit).

 The normal penalty rate of 5% per month applies

to payments made after the PBGC notification date.

Temporary Voluntary Compliance Program for Pre-1996

Plan Years—Open Until April 30, 1997

The PBGC has adopted a temporary voluntary compliance program for premiums owed for pre-1996 plan years

that will provide penalty relief for plans that notify PBGC by

April 30, 1997. The penalty rate will be 1% per month,

rather than the normal 5% per month, if the payments are

made voluntarily before the date PBGC issues a written

notification indicating that there is or may be a premium

delinquency (e.g., a statement of account, past-due-filing

notice, or letter initiating an audit).

To take advantage of the program, you must either pay

the unpaid amount with a Form 1 for the applicable plan

year by April 30, 1997; or notify the PBGC in writing by

April 30, 1997, of your intention to participate in the

program, and pay the unpaid amount with a Form 1 for

the applicable plan year by June 30, 1997. Include

“ATTN: VCP PROGRAM” on any notices, forms, and

payments you send to PBGC under the voluntary compliance

Part F LATE PAYMENT CHARGES
10

program. Send all filings to the appropriate address in item

1 on page v. For questions about premium filings under the

voluntary compliance program, call 703-827-3676

(202-326-4179 for TTY and TDD).

3. PBGC Waivers

Prior to the Filing Due Date, if you can show

substantial hardship and that you will be able to pay the

premium within 60 days after the Filing Due Date, you

may request us to waive the Late Payment Penalty

Charge. If we grant your request, we will waive the Late

Payment Penalty Charge for up to 60 days.

To request a waiver, write separately to:

Pension Benefit Guaranty Corporation

P.O. Box 64916

Baltimore, MD 21264-4916

Waivers may also be granted based on any other

demonstration of good cause. If you wish to request such

a waiver, write to the address above after you receive a

statement of account assessing penalties.

It is YOUR responsibility as plan administrator to

obtain the necessary forms and submit filings on time.

(You should ensure that you maintain an updated address

with the PBGC so that we can mail your next Premium

Payment Package to you. See Part G, Item 2.) We will

NOT waive late payment penalties resulting from your

failure to obtain the necessary forms.

4. IRS Extension For Form 5500

NOTE: If the Internal Revenue Service has granted

the plan an extension of the due date for filing the Form

5500 series, this does NOT extend the Filing Due Date

for Form 1.

5. Minimizing Late Payment Charges

If you are having difficulty determining the actual

participant count prior to the First Filing Due Date, see

Part C, Item 1 “General Rule,” on how to file using an

estimated participant count. This will minimize the

assessment of Late Payment Charges to the plan.

If you are having difficulty determining your plan’s

premium prior to the Final Filing Due Date, you can file

the Form 1 and Schedule A using an estimate. You can

then file an amended Form 1 and Schedule A reflecting the

actual figure (see Part E for procedure). This will minimize

the assessment of Late Payment Charges to the plan.

If you file a Form 1-ES for your plan by its First

Filing Due Date, you may be able to avoid a Late

Payment Penalty Charge with respect to that payment

(see Part C). However, if the flat-rate amounts paid with

your Form 1 and Form 1-ES total less than your flat rate

premium for a single-employer plan (or the total premium for a multiemployer plan), then you will be

charged a Late Payment Penalty (as well as Interest) on

the shortfall from the Form 1-ES First Filing Due Date

until the shortfall is paid.

Part G ITEM-BY-ITEM INSTRUCTIONS

FOR FORM 1

Check for Amended Filing

If you are amending your 1997 Final Filing, check

this box and complete the forms as explained in Part E.

Check for Disaster Relief

From time to time, when major disasters occur, the

PBGC publishes a notice of disaster relief in the Federal

Register, waiving late filing penalties for certain plans. If

your plan is covered by a PBGC disaster relief notice for

this premium filing, follow the instructions in the notice

and check this box.

The “Item” numbers below refer to the Item or Line

numbers on the Form 1.

Item 1 Name of Plan Sponsor

Enter the name and address of the plan sponsor.

Make sure you report the plan sponsor’s name and

address correctly, especially if there has been a change in

the last year. If the plan sponsor’s address or name has

changed since your last filing, check the box in the upper

right hand corner of Item 1.

It is very important that the address shown in Item 1

be correct.

The term “plan sponsor” means:

a. the employer(s), in the case of a single-employer

pension plan;

b. the employee organization, in the case of a plan

established or maintained by an employee organization; or

c. in the case of a plan established or maintained by

two or more employers and one or more employee

organizations, the association, committee, joint board of

trustees, or other similar group of representatives of the

parties who establish or maintain the plan.

Item 2 Name of Plan Administrator

If the name and address of the plan administrator is

the same as that of the plan sponsor, check the second

box in the upper right hand corner of Item 2 and skip to

Item 3. Otherwise, enter the name and address of the

plan administrator.

If the plan administrator’s address or name has

changed since your last filing, check the first box in the

upper right hand corner of Item 2.

It is very important that the plan administrator’s

name and address be correct, especially if there has been

a change in the last year. This is the address we will use

to mail your 1998 Premium Payment Package and, as

appropriate, 1998 Estimated Premium Payment Package.

Item 3 Plan Sponsor’s EIN and PN

Item 3(a) EIN For The Plan Sponsor

Enter the EIN for the plan sponsor. Be sure that the

EIN entered here is the same as the EIN entered on the

Part G ITEM-BY-ITEM INSTRUCTIONS FOR FORM 1
11

Part G ITEM-BY-ITEM INSTRUCTIONS FOR FORM 1

Form 5500 series for the plan year preceding the premium payment year.

For plans that meet the definition of a

multiemployer plan, enter the EIN assigned to the joint

board of trustees. In the case of a plan to which more

than one employer contributes (other than a

multiemployer plan), enter the EIN of the plan sponsor

identified in Item 1. In the case of a controlled group

plan, enter the EIN of the parent or, if there is no parent,

of the largest employer.

Item 3(b) Plan Number

Enter the Plan Number (PN) for the plan. Be sure

that the PN entered here is the same as the PN entered on

the Form 5500 series for the plan year preceding the

premium payment year.

Item 3(c) Does EIN/PN Match Form 5500?

Do the EIN in Item 3(a) and the PN in Item 3(b)

match exactly the EIN and PN entered on the Form 5500

series for the plan year preceding the premium payment

year? Check the “Yes” or “No” box. If no, enter the

EIN/PN used for the Form 5500 filing, attach an explanation, and check the box in Item 19.

Item 3(d) Has A Plan Transferred any Assets or

Liabilities To This Plan?

If one or more plans have transferred any assets or

liabilities to the plan whose EIN/PN is entered in Item

3(a) and (b) since the last premium filing, check the

“Yes” box. In the case of a plan that is filing for the first

time, this includes a transfer of assets or liabilities that

was made to the plan when it was established. If you

check “Yes,” enter the EIN and PN of each plan that

transferred any assets or liabilities to your plan in the

space provided. Also enter the date and type of each

transfer (the three types of transfer are explained below).

If more than 2 plans have transferred assets or liabilities

to your plan, attach a separate sheet listing the EIN/PN of

each additional plan and the date and type of each

transfer. If you attach a separate sheet, check the box in

Item 19.

For purposes of this item, the three types of transfer

are merger, consolidation, and spinoff, designated as

“M,” “C,” and “S” respectively. Check the box under the

appropriate letter for the type of each transfer.

Plan mergers and plan consolidations are transactions in which one or more transferor plans transfer all of

their assets and liabilities to a transferee plan and disappear (because they become part of the transferee plan).

However, there are important differences between the

two kinds of transactions. In a merger, the transferee

plan is one that existed before the transaction. In a

consolidation, the transferee plan is a new plan that is

created in the consolidation. Thus, the plan that exists

after a consolidation follows the premium filing rules for

new plans. In particular, it need not make an early

premium payment with Form 1-ES (no matter how many

participants any of the transferor plans had for the prior

year(s)), it may not use the alternative calculation

method, and its filing due date is subject to the special

rules for new plans. On the other hand, the transferee

plan in a merger follows the normal rules for preexisting,

ongoing plans.

In a spinoff, the transferor plan transfers only part of

its assets and/or liabilities to the transferee plan, so that

both the transferor and the transferee plan exist after the

transaction. The transferee plan may be a new plan that

is created in the spinoff, or it may be a preexisting plan

that simply receives part of the assets and/or liabilities of

the transferor plan.

Note that refunds are not available for “overlapping” premium payments resulting from a plan merger,

consolidation, or spinoff.

Item 4 Change In EIN or PN

This item should be completed to report a change in

EIN or PN since your last Form 1 or Form 1-ES filing.

The EIN of the plan sponsor or the plan’s PN may

change for a number of reasons.

Item 4(a) Change In EIN

Enter the previous EIN in the space provided.

Item 4(b) Change In PN

Enter the previous PN in the space provided.

Item 4(c) Effective Date

Enter the effective date of the change in EIN/PN.

Item 5 Plan Coverage Status

If the plan is covered under section 4021 of ERISA,

check 5(a) “Covered.”

If you are not certain if the plan is covered, check

5(b) “Uncertain.” See Part B, Item 1, and Part D, Item 4,

of these instructions.

If you check “Uncertain,” you should complete

Form 1 and pay the appropriate premium as if the plan

were covered. Attach a separate sheet to explain why

you checked “Uncertain,” and check the box on line 19.

Item 6 Is This The First Premium Filing For

This Plan?

Check the “No” box if you are filing for a second or

subsequent time, and go to Item 7. Check the “Yes” box

if you are filing for the first time, and complete Items

6(a), 6(b), and 6(c).

Item 6(a) Plan Effective Date

Enter the date on which the plan became effective

with respect to benefit accruals for future service.

Item 6(b) Plan Adoption Date

Enter the date on which the plan was formally

adopted.
12

Part G ITEM-BY-ITEM INSTRUCTIONS FOR FORM 1

Item 6(c) Plan Coverage Date

Enter the date on which the plan became covered

under section 4021 of ERISA. If you are unsure whether

your plan is covered, check the “Uncertain” box in Item 5

and leave this date field blank.

Item 7 Is The Plan Terminated?

Check the “Yes” box if you have issued notices of

intent to terminate to affected parties (with respect to a

single-employer plan) or you have filed a Notice of

Termination with PBGC (with respect to a multiemployer

plan).

If you check “Yes,” enter, on line 7(a), the date the

assets were distributed or, on line 7(b), the date a trustee

was appointed under section 4042 of ERISA, whichever

occurred earlier. If neither event has occurred, then enter

“UNKNOWN” in the space provided for the dates; and

NOTE: You must continue to file Form 1 and, if

applicable, Form 1-ES, and pay premiums through and

including the plan year in which all assets are distributed

or a trustee for the plan is appointed under section 4042.

See Part B, Item 2.

Item 8 Industry Code

Enter the 4 digit code that best describes the nature

of the employer’s business. If more than one employer is

involved, enter the industry code for the predominant

business activity of all employers. Choose one code

from the list in Appendix B at the back of this package.

Item 9 Name of Plan

Enter the complete name of the plan as stated in the

plan document. For example, “The ABC Company

Pension Plan for Salaried Personnel.”

Item 10 Name and Phone Number of

Plan Contact

Item 10(a) Name of Plan Contact

Enter the name of the person we may contact if we

have any questions concerning this filing. If Form 1 was

completed by a plan consultant, you may enter the

consultant’s name.

Item 10(b) Phone Number of Plan Contact

Enter the phone number of the plan contact named

in Item 10(a).

Item 11 Plan Type

Check the appropriate box to show plan type. For

purposes of determining plan type, all trades or businesses (whether or not incorporated) that are under

common control are considered to be one employer.

Item 11(a) Multiemployer Plans

Check Item 11(a), “Multiemployer Plan,” if the plan

is a multiemployer plan.

All plans that file the Form 5500 series for the

preceding plan year as a “Multiemployer Plan” should

file the PBGC Form 1 for the current plan year as a

multiemployer plan. If the two filings do not both report

a multiemployer plan, you must provide an explanation

on a separate sheet attached to the Form 1. All other

Form 5500 series plan type categories are considered to

be single-employer plans for the PBGC Form 1 filing.

For any plan year beginning on or after September 26, 1980, a multiemployer plan is a plan—

a. to which more than one employer is required to

contribute,

b. which is maintained pursuant to one or more

collective bargaining agreements between one or more

employee organizations and more than one employer, and

c. which satisfies such other requirements as the

Secretary of Labor may prescribe by regulation.

(The above definition does not apply to a plan that

elected on or before September 26, 1981, with PBGC’s

approval, not to be treated as a multiemployer plan (see

ERISA section 4303). Such a plan is treated as a singleemployer plan.)

The plan administrator of a multiemployer plan

MUST file a Form 1 and, if applicable, Form 1-ES and

pay a premium for the plan as a whole. The administrator CANNOT file a separate Form 1 (or Form 1-ES) and

pay a premium for each individual employer.

Item 11(b) Single-Employer Plans

Check Item 11(b), “Single-Employer Plan,” if the

plan does not meet the above definition of multiemployer

plan.

A single-employer plan includes a “multiple

employer” plan. A multiple employer plan is a plan -

a. to which more than one employer contributes, and

b. that does NOT satisfy the definition of

multiemployer plan, or that elected on or before September 26, 1981, with PBGC’s approval, not to be treated as

a multiemployer plan (see ERISA section 4303).

If several employers participate in a program of

benefits wherein the funds attributable to each employer

are available only to pay benefits to that employer’s

employees, then the plan administrator MUST file a

separate Form 1 and, if applicable, Form 1-ES and pay a

separate premium for each individual employer.

If several employers participate in a program of

benefits wherein the funds attributable to each employer

are available to pay benefits to all participants, then the

plan administrator MUST file a Form 1 and, if applicable, Form 1-ES and pay a premium for the plan as a

whole. Separate filings and premiums CANNOT be

submitted for each individual employer.

If separate plans are maintained for different groups

of employees, regardless of whether each has the same

sponsor or the sponsors are part of the same controlled

group, then the plan administrator(s) MUST file a

separate Form 1 and, if applicable, Form 1-ES and pay a

separate premium for each plan.
13

Part G ITEM-BY-ITEM INSTRUCTIONS FOR FORM 1

Item 12 Plan Year

Item 12(a)

Enter the beginning date of the plan year for which

you are making the premium payment.

Item 12(b)

Enter the ending date of the plan year for which you

are making the premium payment.

Item 12(c)

Check the box if the month and day on which the

plan year begins is not the same as that shown on the last

Form 1 you filed with us. Attach a separate sheet with a

brief explanation for the change, and check the box in

Item 19.

Item 12(d)

If you checked the box in Item 12(c), enter the

adoption date of the plan year change.

Item 13 Participant Count

Enter the total number of participants covered by

the plan. This is the number on which the plan’s premium is based.

Item 13(a) Participant Count for the Premium

Payment Year.

a. Participant Definition

For the purposes of Item 13(a), a “participant” is an

individual who is included in one of the categories

below:

(i) Active.

(A) Any individual who is currently in employment covered by the plan and who is earning or

retaining credited service under the plan. This

category includes any individual who is

considered covered under Code minimum

coverage rules but does not have any accrued

benefit.

(B) Any non-vested individual who is not

currently in employment covered by the plan

but who is earning or retaining credited service

under the plan. This category does not include

a non-vested former employee who has incurred a break in service the greater of one year

or the break in service period specified in the

plan.

(ii) Inactive.

(A) Inactive Receiving Benefits. Any individual who is retired or separated from employment covered by the plan and who is receiving

benefits under the plan. This category does not

include an individual to whom an insurer has

made an irrevocable commitment to pay all the

benefits to which the individual is entitled

under the plan.

(B) Inactive Entitled to Future Benefits. Any

individual who is retired or separated from

employment covered by the plan and who is

entitled to begin receiving benefits under the

plan in the future. This category does not

include an individual to whom an insurer has

made an irrevocable commitment to pay all the

benefits to which the individual is entitled

under the plan.

(iii) Deceased.

Any deceased individual who has one or more

beneficiaries who are receiving or entitled to

receive benefits under the plan. This category

does not include an individual if an insurer has

made an irrevocable commitment to pay all the

benefits to which the beneficiaries of that

individual are entitled under the plan.

b. Participant Count

Count the number of plan participants as of the

LAST DAY OF THE PRECEDING PLAN YEAR (see

Examples 1 and 2), except as follows:

(i) New or Newly Covered Plans. If this is a new

plan or a newly covered plan, count participants as

of the first day of the plan year for which you are

making the premium payment, or the first day the

plan became effective for benefit accruals for future

service, if that is later (see Example 3).

(ii) Certain Mergers or Spinoffs. If the plan is the

transferee plan in a merger or the transferor plan in a

spinoff and the transaction meets the conditions

described in (A) and (B) below, count participants as

of the first day of the plan year for which you are

making the premium payment (see Examples 4 and 5).

A plan merger or spinoff (as defined in the regulations under section 414(l) of the Code) is covered by

this rule if—

(A) a merger is effective on the first day of the

transferee (the continuing) plan’s plan year, or a

spinoff is effective on the first day of the

transferor plan’s plan year, and

(B) the merger or spinoff is not de minimis, as

defined in the regulations under section 414(l)

of the Code with respect to single-employer

plans, or under the PBGC’s regulation under

section 4231 of ERISA (29 CFR Part 4231 -

formerly Part 2672) with respect to

multiemployer plans.

 A continuing plan has a plan year beginning September 1, 1997, and ending August 31, 1998.

Determine the participant count as of August 31, 1997.

 A continuing plan changes its plan year

from a calendar year to a plan year that begins June 1,

1997. For the plan year beginning January 1, 1997,

determine the participant count as of December 31, 1996.

For the plan year beginning June 1, 1997, determine the

participant count as of May 31, 1997.
14

Part G ITEM-BY-ITEM INSTRUCTIONS FOR FORM 1

 A new plan has a plan year beginning

January 1, 1997, and ending December 31, 1997.

Determine the participant count as of January 1, 1997.

 Plan A has a calendar plan year and Plan B

has a July 1 - June 30 plan year. Effective January 1, 1997,

Plan B merges into Plan A (and the merger is not de

minimis). Plan A determines its participant count as of

January 1, 1997. (Since Plan B did not exist at any time

during 1997, it does not owe a premium for the 1997

plan year.)

 Plan A has a calendar plan year. Effective

January 1, 1997, Plan A spins off assets and liabilities to

form a new plan, Plan B (and the spinoff is not de

minimis). Plan A determines its participant count as of

January 1, 1997. (Plan B also determines its participant

count as of January 1, 1997, since it is a new plan that

became effective on that date.)

Item 13(b) Form 5500 Participant Count (if

different).

You must also enter, in Item 13(b), the participant

count reported on the plan’s Form 5500 series for the

plan year preceding the premium payment year, if it is

different from the entry in Item 13(a). This does not

apply to new plans since they are not required to file a

Form 5500 series for the year preceding their first plan

year.

The participant count you enter in Item 13(a) of the

PBGC Form 1 may be the same as the participant count

reported on the plan’s Form 5500 series for the preceding

plan year.

If the Form 5500 participant count is higher than the

premium participant count, you may enter in Item 13(a)

the participant count you reported in the Form 5500

series. Entering the higher participant count will increase

the flat rate premium for all plans and the variable rate

premium payable by Regulated Public Utility Plans for

which the uncapped per-participant variable rate premium on line 7 of Schedule A exceeds $53.

Item 14 Premium For Multiemployer Plans

Multiply the participant count you entered in Item

13(a) by $2.60. Enter the result in Item 14. This is the

total premium due.

Item 15 Premium For Single-Employer Plans

Item 15(a) Flat Rate Premium

Multiply the participant count you entered in Item

13(a) by $19 and enter the result in Item 15(a). This is

the flat rate premium.

Item 15(b) Variable Rate Premium

In Item 15(b) enter the amount entered in line 9 of

Schedule A. This is the amount you must pay for the

variable rate premium.

Item 15(c) Total Premium

Add Items 15(a) and 15(b) and enter the result in

Item 15(c) of the Form 1. This is the total premium.

Item 16 Premium Credit

Item 16(a) Amount Paid With 1997 Form 1-ES

Enter any amounts you previously paid for the 1997

plan year with Form 1-ES.

Item 16(b) Credit Balance From Previous

Years or Other Credit

Enter the amount of any available credit from line

18 of your 1996 Form 1 (see Part E) or line 8 of your

1997 Form 1-ES. You may also enter any other credit

you are entitled to claim. Attach an explanation of any

credit claimed on line 16(b) (other than an amount

entered on line 18 of your 1996 Form 1 or line 8 of your

1997 Form 1-ES) and check the box in Item 19.

Item 16(c) Total Credit

Add Items 16(a) and 16(b) and enter the result in

Item 16(c) of the Form 1. This is the total credit.

Item 17 Premium Due The PBGC

Item 17(a)

If this is a multiemployer plan and the amount you

entered in Item 14 exceeds the amount entered in Item

16(c), subtract the amount entered in Item 16(c) from the

amount entered in Item 14 and enter the result in Item

17(a) of Form 1. This is the amount you owe the PBGC.

If this is a single-employer plan and the amount you

entered in Item 15(c) exceeds the amount entered in Item

16(c), subtract the amount entered in Item 16(c) from the

amount entered in Item 15(c) and enter the result in Item

17(a) of the Form 1. This is the amount you owe the

PBGC.

Item 17(b)

Enclose with the Form 1 a check for the amount

shown in Item 17(a) payable to the Pension Benefit

Guaranty Corporation. Enter the amount of the check in

Item 17(b). Write the EIN/PN you entered in Item 3(a)

and (b) on the check. To ensure proper credit of your

premium payment, each Form 1 for each EIN/PN must

be filed with a check for the exact amount due for the

plan. Do not combine payments for different plans in

one check.

Item 18 Amount Of Overpayment

If this is a multiemployer plan and the amount you

entered in Item 14 is less than the amount entered in Item

16(c), subtract the amount entered in Item 14 from the

amount entered in Item 16(c) and enter the result in

Item 18. This is the amount of your overpayment.

If this is a single-employer plan and the amount you

entered in Item 15(c) is less than the amount entered in

Item 16(c), subtract the amount entered in Item 15(c)
15

from the amount entered in Item 16(c) and enter the

result in Item 18. This is the amount of your overpayment.

If a premium is overpaid for a plan, and any part of

another year’s premium or late payment charge is still

owing for that plan, the overpayment will be applied

toward paying the outstanding amount(s) due.

You may designate which outstanding amount(s) of

premium or late payment charge an overpayment is to be

applied against (if it has not already been applied). If

you do not so designate, we will apply the overpayment

first to the outstanding premium, interest, and penalty (in

that order) from the earliest plan year, then the next

earliest plan year, etc.

An amount of overpayment that is not needed to pay

amounts owed may be refunded upon request made

within the period specified in the applicable statute of

limitations (generally six years after the overpayment was

made) or may be claimed as a credit on a Form 1 or

Form 1-ES filed within the same period. If line 18 shows

an overpayment, you may request a refund by checking

the box in Item 18. An overpayment on one plan cannot

be applied to offset an underpayment on one or more

other plans.

Item 19 Additional Information

If you have used attachments other than the

Schedule A to explain any of your answers, check the

box. Be sure to show the plan name and the EIN/PN at

the top of each sheet.

Item 20 Certification of Multiemployer

Plan Administrator

If your plan is a multiemployer plan, then you, as

plan administrator, must sign the Form 1 in this space.

We may return your filing if it does not have your

signature. Single-employer plans - see Items 10 and 11

of Schedule A to Form 1.

Part H GENERAL INSTRUCTIONS

FOR SCHEDULE A

The instructions in this part give you the general

instructions and requirements for filling out the

Schedule A that must be attached to each Form 1 for each

single-employer plan.

A key point to filling out the Schedule A is the

requirement for you to select a “Filing Method” for your

plan. Your plan may be eligible for more than one filing

method. However, you may select only one filing

method. Under some filing methods, it may take more

time to complete the Schedule A than under others.

Some methods require the services of an enrolled

actuary. We urge you to review this part carefully before

completing Schedule A in order to take advantage of the

filing method that best suits your needs.

The specific instructions for each line of the

Schedule A are in Part I, Line-By-Line Instructions for

Schedule A.

1. General Requirements

All single-employer plans must complete

Schedule A of the PBGC Form 1. You will use

Schedule A to determine the amount of the variable rate

premium. For some plans, the amount will be $0. The

variable rate premium (even if it is $0) must be entered

on the Schedule A, line 9, and also on the Form 1, Line

15(b). You, and in some cases an enrolled actuary, must

certify that the variable rate premium is correct, even if

the amount is $0.

The variable rate premium is $9 per $1,000, or

fraction thereof, of unfunded vested benefits as of the last

day of the plan year preceding the premium payment

year. The vested benefits must be valued using an

interest rate required by ERISA. (See Part H.7.)

If your plan is a Regulated Public Utility Plan and

the variable rate premium exceeds $53 per participant,

special reduction rules may apply. (See instructions for

line 8.)

2. Failure To File Schedule A

If you fail to file a completed and signed

Schedule A, we may return your entire filing along with

any payment accompanying the filing and the payment

may be treated as not having been made. The PBGC

may rely on data it obtains from other sources to estimate

the variable rate amount due and you will be billed for

that amount plus penalties and interest, as applicable.

3. Computation Date For The Variable

Rate Premium

The date for the computation or determination of the

variable rate premium is generally the last day of the plan

year preceding the premium payment year and is the

same date as the participant count date.

Part H GENERAL INSTRUCTIONS FOR SCHEDULE A
16

Part H GENERAL INSTRUCTIONS FOR SCHEDULE A

However, for new or newly covered plans, plans

that are transferee plans in a merger (other than a de

minimis merger) that is effective on the first day of the

plan’s premium payment year, and plans that are

transferor plans in a spinoff (other than a de minimis

spinoff) that is effective on the first day of the plan’s

premium payment year, the “first day of the premium

payment year (or, in the case of a new or newly covered

plan, the date on which the plan became effective for

benefit accruals for future service, if later)” should be

substituted for the “last day of the plan year preceding

the premium payment year” whenever that latter date is

used in Parts H and I of these instructions or in the

Schedule A. This exception is the same as the exception

for the participant count date for the same situations; see

Part G, Item 13, for additional information and examples.

4. Filing Methods

You determine the variable rate premium on

Schedule A under the “General Rule” or under an

optional filing method.

All single-employer plans are eligible to use the

“General Rule.” The General Rule requires a determination of vested benefits and assets and a determination of

unfunded vested benefits by an enrolled actuary as of the

last day of the plan year preceding the premium payment

year. (For a more complete description of the requirements, see 5.a below.)

To avoid the expense that might be involved in

using the General Rule, you may wish to consider using

an optional filing method. Review the requirements for

each method to see if you can use it and whether you

wish to do so.

The first optional filing method - the Alternative

Calculation Method - requires only an adjustment of

amounts determined as of the first day of the plan year

preceding the premium payment year that are required to

be reported in the plan’s Form 5500, Schedule B.

If you file under optional filing methods in items

1(c)(1) through 1(c)(5), you do not have to determine or

calculate unfunded vested benefits and you do not have

to pay a variable rate premium.

The optional filing method on line 1(d) is a variation

of the Alternative Calculation Method for plans terminating in distress or involuntary terminations. It uses the

Schedule B for the termination plan year or, if unavailable, for the preceding plan year.

If you use the optional filing method on line 1(e) for

Small Regulated Public Utility Plans, you do not need to

complete lines 2 through 7 of the Schedule A. You also

do not need an enrolled actuary certification. Check the

box in item (d) at the top of page 1 of Schedule A if your

plan satisfies the definition of a “Regulated Public Utility

Plan” in Part A.2. (Definitions).

The optional filing methods are listed below with

the line numbers on Schedule A.

LINE OPTIONAL FILING METHODS

1(b) Alternative Calculation Method

(See 5.b below.)

1(c)(1) Plans with no vested participants

(See 5.c.(i) below.)

1(c)(2) Section 412(i) plans

(See 5.c.(ii) below.)

1(c)(3) Fully funded small plans (under 500

participants)

(See 5.c.(iii) below.)

1(c)(4) Plans terminating in standard termination

(See 5.c.(iv) below.)

1(c)(5) Plans at full funding limit

(See 5.c.(v) below.)

1(d) Plans terminating in distress or involuntary

termination

(See 5.d below.)

1(e) Small Regulated Public Utility Plans (under

500 participants) paying maximum variable

rate premium

(See 5.e below.)

5. Requirements For Filing Method Selection

Listed below are the requirements for the filing

methods and the location of the line-by-line instructions

for completing Schedule A under each of the filing

methods.

All the filing methods require the plan administrator

to certify to the correct completion of Form 1 and

Schedule A, and that any information given to the

enrolled actuary is true, correct, and complete. The plan

administrator must also complete a certification about

compliance with participant notice requirements (see Part

H.8.). Additional certifications are noted below.

a. General Rule. Under the General Rule, an

enrolled actuary determines the amount of unfunded

vested benefits as of the last day of the plan year preceding the premium payment year, in accordance with

ERISA section 4006(a)(3)(E)(iii) and generally accepted

actuarial principles and practices. The actuary may

either perform a valuation as of the last day of the plan

year preceding the premium payment year, or adjust the

results of a valuation done as of a different date to reflect

any differences in plan assets, population, and provisions

between the different valuation date and the last day of

the plan year preceding the premium payment year so

that the adjusted results satisfy all of the requirements for

the General Rule method. A plan’s unfunded vested

benefits equal the excess of: (1) the plan’s current

liability (within the meaning of ERISA section

302(d)(7)) determined by taking into account only vested

benefits and valued at the Required Interest Rate described in Part H.7. of these instructions, over (2) the

actuarial value of the plan’s assets determined in accor-
17

Part H GENERAL INSTRUCTIONS FOR SCHEDULE A

dance with ERISA section 302(c)(2) without a reduction

for any credit balance in the plan’s funding standard

account.

(i) General Requirements: The determination under

the General Rule must reflect the plan’s population

and provisions as of the last day of the plan year

preceding the premium payment year. Population

data may be based on an actual census or a representative sample of the plan’s population. The enrolled

actuary must make the determination using the same

actuarial assumptions and methods used by the plan

for purposes of determining the minimum funding

contributions under section 302 of ERISA and

section 412 of the Code for the plan year preceding

the premium payment year (or, in the case of a plan

to which the special computation date rule in Part

H.3. applies, for the premium payment year), except

to the extent that other actuarial assumptions are

specifically prescribed by these instructions or are

necessary to reflect the occurrence of a significant

event described in Part H.6. below, between the date

of the funding valuation and the last day of the plan

year preceding the premium payment year. (If the

plan does a funding valuation as of the last day of

the plan year preceding the premium payment year,

no separate adjustment for significant events is

needed.)

Under this rule, the determination of the

unfunded vested benefits may be based on a plan

funding valuation performed as of the first day of

the premium payment year, provided that—

(A) the actuarial assumptions and methods used

are those used by the plan for purposes of

determining the minimum funding contributions under section 302 of the Act and section

412 of the Code for the premium payment year,

except to the extent that other actuarial assumptions are specifically prescribed by these

instructions or are required to make the adjustment described in paragraph (B) below; and

(B) if an enrolled actuary determines that there

is a material difference between the values

determined under the valuation and the values

that would have been determined as of the last

day of the preceding plan year, the valuation

results are adjusted to reflect appropriately the

values as of the last day of the preceding plan

year. (This adjustment need not be made if the

unadjusted valuation would result in greater

unfunded vested benefits.)

(ii) Certification Requirement (in addition to plan

administrator certification): In all cases under the

General Rule, an enrolled actuary must certify to the

determination of the variable rate premium. In

addition—

(A) in the case of a large plan (500 or more

participants), if the enrolled actuary

—determines that the actuarial value of plan

assets equals or exceeds the value of all

accrued benefits (valued at the Required

Interest Rate described in Part H.7. of these

instructions); and

—elects to report the value of accrued benefits

in lieu of the value of vested benefits on line

2(a) of Schedule A,

the enrolled actuary must certify to having done

so on line 11(a) of Schedule A.

(B) If

—the interest rate used by the plan to value

current liability was not greater than the

Required Interest Rate described in Part H.7.;

and

—the enrolled actuary reports the value of

vested benefits at the plan’s interest rate on line

2(b) of Schedule A,

the enrolled actuary must certify to the above

on line 11(c) of Schedule A.

(iii) Size Requirement: Plans with any number of

participants may use this method.

(iv) Instructions: For line-by-line instructions for

completing Schedule A, see Part I, Subpart 1 of

these instructions.

(v) Schedule A Filing Method: Check the box for

Item 1(a).

b. Alternative Calculation Method. This method is

a simplified method intended to approximate the more

precise determinations of the General Rule. It uses two

formulas to calculate unfunded vested benefits as of the

last day of the plan year preceding the premium payment

year.

The first formula adjusts the value of vested benefits

for participants in pay status and deferred vested participants, as reported on Schedule B of the Form 5500 as of

the first day of the plan year preceding the premium

payment year, using the Required Interest Rate prescribed by ERISA. Part H.7. of these instructions tells

you how to determine the Required Interest Rate that

applies to your plan.

The second formula adjusts the resulting unfunded

vested benefits figure for the passage of time from the

first day of the plan year preceding the premium payment

year to the last day of the plan year preceding the

premium payment year. The adjustment is necessary

because, for premium purposes, unfunded vested benefits

are determined as of the last day of the plan year preceding the premium payment year. See the line-by-line

instructions in Part I, Subpart 2, lines 2(b) and 4, for the

two formulas.

If the Alternative Calculation Method is used by a

plan that has 500 or more participants as of the last day

of the plan year preceding the premium payment year, an
18

Part H GENERAL INSTRUCTIONS FOR SCHEDULE A

enrolled actuary must adjust the unfunded vested benefits

to reflect the occurrence of any significant event during

the plan year preceding the premium payment year. See

Part H.6. for a list of significant events.

(i) General Requirements: To use the Alternative

Calculation Method, a plan must file a Form 5500

and Schedule B with the IRS, for the plan year

preceding the premium payment year, that has -

(A) vested benefit values reported on lines

2b(1), 2b(2), and 2b(3);

(B) the interest rate, reported on line 6a(1),

used to determine the vested benefit values;

(C) the assumed retirement age reported on line

6b; and

(D) assets reported on line 1b(2) or 2a.

(ii) Certification Requirements (in addition to plan

administrator certification): For plans with 500 or

more participants, an enrolled actuary must certify

on line 11(d) that the unfunded vested benefits have

been adjusted for the occurrence, if any, of a significant event and that the adjustment is consistent with

generally accepted actuarial principles and practices.

(iii) Size Requirements: Plans with any number of

participants may use this method. However, plans

with 500 or more participants that use this method

must report unfunded vested benefits that reflect the

occurrence, if any, of significant events listed in Part

H.6.

(iv) Instructions: For line-by-line instructions for

completing Schedule A, see Part I, Subpart 2, of

these instructions.

(v) Schedule A Filing Method: Check the applicable

box under Item 1(b). If your plan has fewer than

500 participants, check the box for Item 1(b)(1). If

your plan has 500 or more participants, check the

box for Item 1(b)(2).

c. Plans Exempt From Variable Rate Premium.

Certain categories of plans are not required to determine

or report vested benefits, assets or unfunded vested

benefits on Schedule A, or to pay a variable rate premium. These plans are required only to complete lines 1

and 9 on the Schedule A indicating that the plan comes

within one of the exempted categories and to provide the

plan administrator and (if appropriate) enrolled actuary

certifications.

(i) Plans With No Vested Participants. If a plan has

no vested participants as of the last day of the plan

year preceding the premium payment year, the plan

administrator may use this filing method and report

a $0 variable rate premium on the Schedule A.

(A) General Requirements: To use this rule a

plan must have had no vested participants as of

the last day of the plan year preceding the

premium payment year.

(B) Certification Requirement (in addition to

plan administrator certification): None. Only

the plan administrator certification is required.

(C) Size Requirement: Plans with any number

of participants may use this method.

(D) Instructions: For line-by-line instruction for

completing Schedule A, see Part I, Subpart 3,

of these instructions.

(E) Schedule A Filing Method: Check the box

on Schedule A, Item 1(c)(1).

(ii) Section 412(i) Plans. Plans described in section

412(i) of the Internal Revenue Code and regulations

thereunder are not subject to the variable rate

premium and report a $0 variable rate premium on

Schedule A.

(A) General Requirements: To use the section

412(i) plan rule, a plan must be a plan described in section 412(i) of the Code and the

regulations thereunder at all times during the

plan year preceding the premium payment year.

If the plan is a new or newly covered plan, it

must be a 412(i) plan at all times during the

premium payment year through the due date for

the variable rate premium.

(B) Certification Requirement (in addition to

plan administrator certification): None. Only

the plan administrator certification is required.

(C) Size Requirement: Plans with any number

of participants may use this method.

(D) Instructions: For line-by-line instructions

for completing Schedule A, see Part I, Subpart

4, of these instructions.

(E) Schedule A Filing Method: Check the box

on Schedule A, Item 1(c)(2).

(iii) Fully Funded Small Plans. Under this rule, an

enrolled actuary certifies that the plan has no

unfunded vested benefits. No computations of

unfunded vested benefits need be reported. The

enrolled actuary simply reports a $0 variable rate

premium on Schedule A.

(A) General Requirements: To use this rule, a

plan must have fewer than 500 participants as

of the last day of the plan year preceding the

premium payment year and no unfunded vested

benefits as of that date (valued at the Required

Interest Rate described in Part H.7. of these

instructions).

(B) Certification Requirements (in addition to

plan administrator certification): The enrolled

actuary must certify on line 11(b) that the plan

had fewer than 500 participants and that the

plan had no unfunded vested benefits as of the

last day of the plan year preceding the premium

payment year (valued at the Required Interest

Rate described in Part H.7. of these instructions).

(C) Size Requirement: Only plans with fewer

than 500 participants on the last day of the plan
19

Part H GENERAL INSTRUCTIONS FOR SCHEDULE A

year preceding the premium payment year may

use this method.

(D) Instructions: For line-by-line instructions

for completing Schedule A, see Part I,

Subpart 5, of these instructions.

(E) Schedule A Filing Method: Check the box

on Schedule A, Item 1(c)(3).

(iv) Plans Terminating In Standard Terminations.

Under this exemption, plans terminating in standard

terminations are not subject to the variable rate

premium and report a $0 variable rate premium on

Schedule A.

(A) General Requirements: Plans that issued a

notice of intent to terminate in a standard

termination in accordance with section

4041(a)(2) of ERISA, setting forth a proposed

date of termination (i.e., the 60-day prospective

date) that is on or before the last day of the plan

year preceding the premium payment year may

use this method.

If the plan does not ultimately make a

final distribution of assets in full satisfaction of

its obligations under the standard termination,

the right to use this filing method will be

revoked and the premium(s) that would otherwise have been required will be due retroactive

to the applicable due date(s).

(B) Certification Requirement (in addition to

plan administrator certification): None. Only

the plan administrator certification is required.

(C) Size Requirement: Plans with any number

of participants may use this method.

(D) Instructions: For line-by-line instructions

for completing Schedule A, see Part I, Subpart

6, of these instructions.

(E) Schedule A Filing Method: Check the box

on Schedule A, Item 1(c)(4).

(v) Plans At The Full Funding Limit. As provided

below, plans at the full funding limit for the plan

year preceding the premium payment year are

exempt from the variable rate premium and should

report a $0 variable rate premium on Schedule A.

(A) General Requirements: Plans may use this

method if, on or before the earlier of the due

date for payment of the variable rate premium

(see Part C) or the date the variable rate

premium is paid, the plan’s contributing

sponsor or contributing sponsors made contributions to the plan for the plan year preceding

the premium payment year in an amount not

less than the full funding limitation for that

preceding plan year under section 412(c)(7) of

the Internal Revenue Code.

The determination of whether contributions for the preceding plan year were in an

amount not less than the full funding limitation

under section 412(c)(7) of the Code for the

preceding plan year is based on the method of

computing the full funding limitation, including

actuarial assumptions and funding methods,

used by the plan (provided these assumptions

and methods met all requirements, including

the requirements for reasonableness, under

section 412 of the Code) with respect to the

preceding plan year. In the event of a PBGC

audit, the plan administrator may be required to

provide documentation to establish both the

computation methods used and the conformance of those methods with the requirements of

Code section 412. The PBGC will report to the

Internal Revenue Service any plans using

assumptions and methods that appear not to

meet the requirements of Code section 412.

Generally, Code section 412(c)(7) defines

the full funding limitation as the excess of a

measure of the plan’s liabilities over a measure

of the plan’s assets. In determining whether a

plan is entitled to this exemption, plan assets

should not be reduced by the amount of any

credit balance in the plan’s funding standard

account.

A plan may be entitled to this exemption

if contributions were rounded down slightly

from the amount of the full funding limitation.

Thus, any contribution that is rounded down to

no less than the next lower multiple of one

hundred dollars (in the case of full funding

limitations up to one hundred thousand dollars)

or to no less than the next lower multiple of one

thousand dollars (in the case of full funding

limitations above one hundred thousand

dollars) is deemed for purposes of this exemption to be in an amount equal to the full funding

limitation. (NOTE: Relief may also be

available where the plan’s actuary rounded

off de minimis amounts to determine the full

funding limit. Whether the exemption applies

in such circumstances would be determined

under the rule discussed in the preceding

paragraph, based on a review of the plan’s

practice with respect to the computation

methods used.)

A plan may be entitled to this exemption

if the sum of the contributions for the plan year

preceding the premium payment year was less

than the full funding limit and the contributions

plus the interest credit under the Code is at

least equal to the full funding limit as of the

end of the plan year preceding the premium

payment year.

(B) Certification Requirement (in addition to

plan administrator certification): The enrolled
20

Part H GENERAL INSTRUCTIONS FOR SCHEDULE A

actuary must certify on line 11(e) that the plan

has met the general requirements described

above.

(C) Size Requirement: Plans with any number

of participants may use this method.

(D) Instructions: For line-by-line instructions

for completing Schedule A, see Part I,

Subpart 7, of these instructions.

(E) Schedule A Filing Method: Check the box

on Schedule A, item 1(c)(5).

d. Plans Terminating In Distress Or Involuntary

Terminations. Under this special rule, plans terminating

in distress or involuntary terminations may use a modified version of the Alternative Calculation Method.

(i) General Requirements: The following plans may

use this method:

—Plans that issue notices of intent to terminate

in a distress termination in accordance with

ERISA section 4041(a)(2) setting forth a

proposed termination date that is on or before

the last day of the plan year preceding the

premium payment year; or

—Plans for which the PBGC has initiated

proceedings for an involuntary termination and

has sought a termination date on or before the

last day of the plan year preceding the premium

payment year.

Some plans terminating in distress or involuntary

terminations may not have filed the Schedule B for the

plan year preceding the premium payment year and

therefore would not be able to use the Alternative

Calculation Method to calculate unfunded vested benefits. This filing method allows such plans to calculate

unfunded vested benefits under a variation of the Alternative Calculation Method that uses vested benefit values

and asset values from an earlier Schedule B than under

the Alternative Calculation Method. The Schedule B

used under this special rule must be for the plan year that

includes (in the case of a distress termination) the

proposed date of termination or (in the case of an

involuntary termination) the termination date sought by

the PBGC, or, if no Schedule B is filed for that plan year,

the Schedule B for the preceding plan year. The Schedule B must have the entries required for the Alternative

Calculation Method, as described in Part H.5.b.(i) of

these instructions. (NOTE: Line item references in the

Alternative Calculation Method instructions are to the

1996 Schedule B. If the Schedule B you are using under

this special rule is for an earlier year with different line

numbers, use the corresponding line numbers listed in

Part I, Subpart 8.)

NOTE: This method assumes (in the case of a

distress termination) that the PBGC has not disapproved

the termination or (in the case of an involuntary termination) that the PBGC’s petition for involuntary termination

has not been denied, dismissed, or withdrawn. If any of

these events occurs, the plan will be treated as an ongoing plan and must file amended premium forms using

another permitted filing method.

(ii) Certification Requirement (in addition to plan

administrator certification): Same as for Alternative

Calculation Method. (See Part H.5.b.(ii) of these

instructions.)

(iii) Size Requirement: Same as for Alternative

Calculation Method. (See Part H.5.b.(iii) of these

instructions.)

(iv) Instructions: For line-by-line instructions for

completing Schedule A, see Part I, Subpart 8, of

these instructions.

(v) Schedule A Filing Method: Check the box on

Schedule A, Item 1(d).

e. Small Regulated Public Utility Plans Paying

Maximum Variable Rate Premium. Certain small

Regulated Public Utility Plans that are required to pay

the maximum variable rate premium or that choose to do

so, rather than compute their unfunded vested benefits

under the General Rule or the Alternative Calculation

Method, can use this filing method. Plans using this

method do not need to complete lines 2 through 7 of

Schedule A.

(i) General Requirements: Plans may use this

method if they check the box in item (d) at the top of

page 1 of Schedule A and pay a variable rate

premium of $53 per participant. A plan that is

maintained by any contributing sponsor that is not a

Regulated Public Utility may NOT use this filing

method. (See Definitions on page 2.)

(ii) Certification Requirement (in addition to plan

administrator certification): None. Only the plan

administrator certification is required.

(iii) Size Requirements: Plans with fewer than 500

participants may use this method.

(iv) Instructions: For line-by-line instructions for

completing Schedule A, see Part I, Subpart 9 of

these instructions.

(v) Schedule A Filing Method: Check the box on

Schedule A, item 1(e).

6. Significant Events

a. General Rule. Plans filing under the General

Rule must use actuarial assumptions and methods that

reflect the occurrence, if any, of a significant event listed

below between the date of the funding valuation for the

plan year preceding the premium payment year and the

last day of the plan year preceding the premium payment

year.

b. Alternative Calculation Method. Plans with 500

or more participants filing under the Alternative Calculation Method are required to reflect in the value of

unfunded vested benefits as of the last day of the plan

year preceding the premium payment year the occur-
21

Part H GENERAL INSTRUCTIONS FOR SCHEDULE A

rence, if any, of a significant event listed below during

the plan year preceding the premium payment year.

c. Distress Or Involuntary Terminations. Plans with

500 or more participants filing under the method for

plans terminating in distress or involuntary terminations

are required to reflect in the value of unfunded vested

benefits as of the last day of the plan year preceding the

premium payment year the occurrence, if any, of a

significant event listed below between the first day of the

plan year for which the Schedule B being used was filed

and the last day of the plan year preceding the premium

payment year.

d. Significant Events. In each of the above circumstances, the plan’s enrolled actuary must make appropriate adjustments to reflect the occurrence of any significant event.

The Significant Events are:

(1) an increase in the plan’s actuarial costs (consisting of the plan’s normal cost under section

412(b)(2)(A) of the Code, amortization charges

under section 412(b)(2)(B) of the Code, and amortization credits under section 412(b)(3)(B) of the

Code) attributable to a plan amendment, unless the

cost increase attributable to the amendment is less

than 5% of the actuarial costs determined without

regard to the amendment;

(2) the extension of coverage under the plan to a

new group of employees resulting in an increase of

5% or more in the plan’s liability for accrued

benefits;

(3) a plan merger, consolidation or spinoff that is not

de minimis pursuant to the regulations under section

414(l) of the Code;

(4) the shutdown of any facility, plant, store, etc.,

that creates immediate eligibility for benefits that

would not otherwise be immediately payable for

participants separating from service;

(5) the offer by the plan for a temporary period to

permit participants to retire at benefit levels greater

than that to which they would otherwise be entitled;

(6) a cost-of-living increase for retirees resulting in

an increase of 5% or more in the plan’s liability for

accrued benefits; and

(7) any other event or trend that results in a material

increase in the value of unfunded vested benefits.

7. Required Interest Rate For Valuing

Vested Benefits

a. General Information. The Required Interest Rate

to be used in valuing vested benefits of a plan (other than

a Regulated Public Utility Plan with a 1997 premium

payment year beginning after June 30) under the General

Rule, the Alternative Calculation Method, or the method

for plans terminating in involuntary or distress terminations can be obtained by calling (202) 326-4041. Except

for Regulated Public Utility Plans with 1997 premium

payment years beginning after June 30, the Required

Interest Rate that applies to you is also printed on the top

line of the mailing label used to mail your premium

payment package. The rate is determined by the month

in which your plan year begins. Check the month on the

mailing label to make sure it corresponds to the first

month of your premium payment year.

The Required Interest Rate is equal to the “applicable percentage” of the annual yield for 30-year Treasury constant maturity securities, which is reported in

Federal Reserve Statistical Release G.13 and H.15, for

the calendar month preceding the calendar month in

which the premium payment year begins. In general, the

“applicable percentage” for 1997 premium payment

years is 80 percent if the premium payment year begins

before July 1 and 85 percent if it begins after June 30.

The “applicable percentage” is different for Regulated

Public Utility Plans with 1997 premium payment years

beginning after June 30.

On or about the 15th of each month, the PBGC

publishes in the Federal Register a list of the Required

Interest Rates for the preceding 12 months (for plans

other than Regulated Public Utility Plans with 1997

premium payment years beginning after June 30).

Additionally, the National Technical Information

Service provides the Required Interest Rates (for plans

other than Regulated Public Utility Plans with 1997

premium payment years beginning after June 30) and

other PBGC interest rates through a subscription service.

For further information, contact:

U.S. Department of Commerce

National Technical Information Service

5285 Port Royal Road

Springfield, VA 22161

Telephone: (703) 487-4630

Facsimile: (703) 321-8547

Order No.: SUB-9244

These are not toll free numbers, and collect calls

cannot be accepted.

Required Interest Rates (for plans other than

Regulated Public Utility Plans with 1997 premium

payment years beginning after June 30) are also posted

on the PBGC’s World Wide Web site (http://

www.pbgc.gov).

b. Regulated Public Utility Plans with 1997

Premium Payment Years Beginning After June 30.

Regulated Public Utility Plans with premium payment

years beginning January 1 through June 30, 1997, use the

same Required Interest Rates as other plans. For a

Regulated Public Utility Plan whose premium payment

year begins during the period July 1 through December 31, 1997, the Required Interest Rate is determined

using a different “applicable percentage” than for other

plans. If your plan is a Regulated Public Utility Plan

with a 1997 premium payment year beginning after
22

June 30, you can determine the Required Interest Rate

for your plan by converting the Required Interest Rate

that would apply if your plan were not a Regulated

Public Utility Plan, using the “Required Interest Rate

Worksheet” on page 38.

c. For Further Information, contact:

Pension Benefit Guaranty Corporation

Communications & Public Affairs Department

1200 K Street, NW

Washington, DC 20005-4026

Telephone: (202) 326-4040

This is not a toll free number, and collect calls cannot

be accepted

8. Certification Of Plan Administrator

The plan administrator of a single-employer plan

must sign and date the certification in item 10 of

Schedule A. We may return any filing that does not have

your original signature in item 10. The certification has

two parts: a general certification about the correctness of

your premium filing, and a certification regarding

compliance with the participant notice requirements in

ERISA section 4011 (29 U.S.C. 1311) and the PBGC’s

regulation on Disclosure to Participants (29 CFR Part

4011—formerly Part 2627).

For each plan year in which a variable rate premium

is payable for a plan, the plan administrator must issue a

notice to participants about the plan’s funding status and

the limits on the PBGC’s guarantee, unless the plan is

exempt from the notice requirement under the Disclosure

to Participants regulation. The participant notice is due

no later than two months after the Form 5500 due date

(or extended due date) for the prior plan year. For

purposes of determining whether the participant notice

was timely issued, if any due date (or extended due date)

falls on a Saturday, Sunday, or legal holiday, the applicable due date is the next business day.

The certification relates to the participant notice

requirement for the plan year preceding the premium

payment year. You must check box (a), (b), or (c). If you

check box (c) (e.g., because a required participant notice

was not issued or was issued late), you must attach an

explanation and check the box in item 19 of Form 1.

NOTE: If your plan had no variable rate premium

for the plan year preceding the premium payment year,

the participant notice requirement did not apply for that

year and you can check box (a). Other exemptions are

described in the Disclosure to Participants regulation.

Note in particular that the regulation contains exemptions

for certain new and newly-covered plans.

Part I LINE-BY-LINE INSTRUCTIONS

FOR SCHEDULE A

Note: Money amounts entered in items 2, 3, and 4

of Schedule A should be in dollars only (no cents). See

rounding instructions under these items.

The instructions in this Part are divided into a

separate Subpart for each one of the Filing Methods in

Item 1 of Schedule A.

To determine which filing method your plan may

use, see Part H.5., Requirements for Filing Method

Selection.

You will only need to follow the instructions in the

Subpart for the filing method you select. Each Subpart

has all the instructions you will need to fill out each line

on the Schedule A for the filing method you use.

Some filing methods do not require that all lines on

the Schedule A be completed. For those methods, we

have provided instructions only for the lines that do need

to be completed.

Below is an index to the Subparts in this part. On

the left under “FILING METHOD” are the filing methods with the appropriate box for you to check on

Schedule A, Item 1, to indicate your choice. On the right

under “SUBPART” is the appropriate Subpart in this Part

with the line-by-line instructions.

Index to Part I Subparts

FILING METHOD SUBPART

Box to check in Item 1

a. General Rule: (Box (a) in Item 1) ............. Subpart 1

b. Alternative Calculation Method:

(1) Plans with fewer than 500 participants.

(Box (b)(1) in Item 1) ........................ Subpart 2

(2) Plans with 500 or more participants.

(Box (b)(2) in Item 1) ........................ Subpart 2

c. Plans not required to determine unfunded

vested benefits:

(1) Plans with No Vested Participants.

(Box (c)(1) in Item 1)......................... Subpart 3

(2) 412(i) Plans.

(Box (c)(2) in Item 1)......................... Subpart 4

(3) Fully Funded Plans with fewer than

500 participants.

(Box (c)(3) in Item 1)......................... Subpart 5

(4) Plans Terminating in Standard Terminations.

(Box (c)(4) in Item 1)......................... Subpart 6

(5) Plans at Full Funding Limit.

(Box (c)(5) in Item 1)......................... Subpart 7

d. Plans Terminating in Distress or Involuntary

Terminations.

(Box (d) in Item 1) ............................. Subpart 8

e. Small Regulated Public Utility Plans Paying

Maximum Variable Rate Premium.

(Box (e) in Item 1) ............................. Subpart 9

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A
23

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

Subpart 1 GENERAL RULE

Be sure to read Part H.5.a. carefully, in addition to

the following line-by-line instructions.

Line 1 Filing Method

If you use the General Rule, you must check the box

in Item 1(a). If you use the accrued benefits rule for

plans with 500 or more participants for line 2(a), the

enrolled actuary must initial the box on line 11(a) as part

of the required certification for all plans using the

General Rule.

Line 2 Present Value Of Vested Benefits

You must report on line 2 the value of the plan’s

vested benefits. Round entries that include cents down to

the next lower whole dollar amount. The value of a

plan’s vested benefits for premium purposes equals the

amount of a plan’s current liability (within the meaning

of section 302(d)(7) of ERISA) determined by taking

into account only vested benefits. You must report on

line 2(a) the value of vested benefits using the plan’s

interest rate for determining current liability, and on line

2(b) the value of vested benefits using the Required

Interest Rate.

Accrued Benefit Relief Rule For

Large Plans

This is a special rule providing relief from determining vested benefits for certain plans that had 500 or more

participants on the last day of the plan year preceding the

premium payment year.

If an enrolled actuary determines that the Total

Value of Plan Assets on line 3(d) equals or exceeds the

value of all benefits accrued under the plan (using plan

assumptions, except that the benefits must be valued at

the Required Interest Rate as defined in the instructions

to Line 2(b)), the enrolled actuary need not determine the

values of the plan’s vested benefits. The actuary may

instead report on line 2(a) the values of accrued benefits

using the plan’s assumptions and on 2(b) the values of

accrued benefits adjusted only for the Required Interest

Rate.

If you use this rule, the enrolled actuary must initial

box (a) on line 11.

Interest Adjustment Relief Rule

If the Required Interest Rate for your plan is equal

to or greater than the plan interest rate used to value the

benefits entered on line 2(a), you may enter the line 2(a)

amounts on line 2(b).

If you use this relief rule for line 2(b), the enrolled

actuary for the plan must initial box (c) on line 11.

Determination Date

Enter the date as of which the value of vested

benefits was determined for premium purposes. The

determination date must be either the first day of the

premium payment year or the last day of the plan year

preceding the premium payment year.

Assumed Retirement Age

Enter the assumed retirement age used to determine

the present value of vested benefits for participants and

beneficiaries not receiving payments.

Required Interest Rate

Enter the Required Interest Rate (See Part H.7. of

these instructions) that must be used by the plan to value

vested benefits for premium purposes.

Accrual Factor

The accrual factor refers to the benefit accrual

adjustment, which does not apply to plans using the

General Rule. Do not enter anything in this space.

Line 2(a)(1) Plan Value of Vested Benefits -

Those Receiving Payments

In the “Value” column, enter the present value of

vested benefits for retirees and beneficiaries receiving

payments.

In the “Interest Rate” column, enter the current

liability interest rate.

Line 2(a)(2) Plan Value of Vested Benefits -

Those Not Receiving Payments

In the “Value” column, enter the present value of

vested benefits for participants and beneficiaries not

receiving payments. This includes all active vested

participants and separated participants with deferred

vested benefits.

In the “Interest Rate” column, enter the current

liability interest rate.

Line 2(a)(3) Total Plan Value of Vested Benefits

Enter the total amount of the present value of vested

benefits determined with the plan’s actuarial assumptions. This is the total of line 2(a)(1) plus line (2)(a)(2).

Line 2(b) Adjusted Value of Vested Benefits

You must report on line 2(b) the adjusted value of

vested benefits using the Required Interest Rate entered

on line 2. The determination of the adjusted value must

meet all the requirements set forth in Part H.5.a. of these

instructions.

Line 2(b)(1) Adjusted Value of Vested Benefits -

Those Receiving Payments

Enter the adjusted present value of vested benefits

for retirees and beneficiaries receiving payments,

determined by adjusting the amount on line 2(a)(1) in

accordance with the requirements set forth in Part H.5.a.

of these instructions.
24

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

Line 2(b)(2) Adjusted Value of Vested Benefits -

Those Not Receiving Payments

Enter the adjusted present value of vested benefits

for participants not receiving payments, determined by

adjusting the amount on line 2(a)(2) in accordance with

the requirements set forth in Part H.5.a. of these instructions.

Line 2(b)(3) Total Adjusted Vested Benefits

Enter the total amount of the present value of

adjusted vested benefits. This is the sum of line 2(b)(1)

plus line 2(b)(2).

Line 3 Value Of Plan Assets

Line 3(a) Value Of Plan Assets As Of

Determination Date

Enter the date as of which assets were valued for

premium purposes. The date must be the same as the

determination date you entered on line 2.

Enter the actuarial value of the plan’s assets determined in accordance with ERISA section 302(c)(2)

without a reduction for any credit balance in the funding

standard account. Round an entry that includes cents up

to the next higher whole dollar amount. You may not

include on line 3(a) contributions for the premium

payment year or later, whether or not made. Adjust all

receipts and disbursements for interest.

Line 3(b) Contribution Receivables In Line 3(a)

Enter the sum of employer and employee contribution receivables that were included in the line 3(a)

amount. Round an entry that includes cents down to the

next lower whole dollar amount.

Line 3(c) Discounted Paid Contributions

For plans with fewer than 500 participants, this line

is optional; you may go to line 3(d). If you do not

complete this line, you may understate the adjusted value

of assets you will report on line 3(d). If this would affect

the amount of the variable rate premium that the plan

owes, you may wish to complete line 3(c).

Enter on line 3(c) the discounted value, as of the

determination date entered on line 3, of those employer

and employee contributions for plan years prior to the

premium payment year that were either reported on line

3(b) (because they were included as receivables in the

line 3(a) amount) or that were not included (as receivables or otherwise) in the Line 3(a) amount. However,

do not include in line 3(c) any contributions that are for

the premium payment year or any contributions that have

not been paid on or before the earlier of the premium due

date or the date the premium is paid. Round an entry that

includes cents up to the next higher whole dollar amount.

The plan asset valuation rate must be used to

discount contributions, on a simple or compound basis in

accordance with the plan’s discounting rules.

Line 3(d) Adjusted Value Of Plan Assets

Enter the sum of line 3(a), minus line 3(b), plus line 3(c).

Line 4 Adjusted Unfunded Vested Benefits

The adjusted unfunded vested benefits is the excess,

if any, of the Total Adjusted Vested Benefits entered on

line 2(b)(3) over the Adjusted Value of Plan Assets

entered on line 3(d).

If line 2(b)(3) is less than line 3(d), enter $0 here

and go to line 9 and enter $0; if not, subtract line 3(d)

from line 2(b)(3), round up to the next $1,000, and enter

here.

An enrolled actuary must certify that the determination of unfunded vested benefits was made in a manner

consistent with generally accepted actuarial principles

and practices. The certification is made by signing and

completing line 11.

Line 5 Multiply Line 4 By 0.009

Multiply the adjusted unfunded vested benefit

amount on line 4 by 0.009 and enter on line 5. If your

plan is NOT a Regulated Public Utility Plan, skip

lines 6-8 and enter the amount from line 5 on line 9.

Line 6 The Participant Count

Regulated Public Utility Plans only: Enter the

participant count from Form 1, line 13(a).

Line 7 Divide Line 5 By Line 6

Regulated Public Utility Plans only: Divide the

amount on line 5 by the participant count on line 6 and

enter. Round to the nearest cent. This is the initial per

participant variable rate premium. If it is greater than

$53, it may be reduced on line 8.

Line 8 Per-Participant Variable Rate

Premium

Regulated Public Utility Plans only: If line 7 is $53

or less, enter the amount from line 7 on line 8. If line 7 is

greater than $53, enter on line 8 the amount from line

(vi) of the Variable Rate Worksheet on page 37.

Line 9 Variable Rate Premium

Enter on line 9 and on Form 1, line 15(b), the

variable rate premium. You have three alternatives:

a. If you checked any box on line 1(c) OR if you

have a plan that has NO Adjusted Unfunded Vested

Benefits shown on line 4, enter $0.

b. If you completed line 5 and your plan is NOT a

Regulated Public Utility Plan, enter the amount on line 5.

c. Otherwise, multiply line 8 by the participant

count from Schedule A, line 6 and enter the result here.

Line 10 Plan Administrator Certification

As plan administrator, you must sign and date the

certification in the space provided. We may return any

filing that does not have your original signature. See

instructions in Part H.8.
25

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

Line 11 Enrolled Actuary Certification

An enrolled actuary must personally sign, date and

enter his or her enrollment number and address in the

space provided on the certification on line 11. If the

Accrued Benefit Relief Rule for line 2 was used, the

enrolled actuary must initial box (a) on line 11. If the

Interest Adjustment Relief Rule was used for line 2, the

enrolled actuary must initial box (c) on line 11.

Subpart 2 ALTERNATIVE CALCULATION

METHOD

Line 1 Filing Method

If you use the Alternative Calculation Method, you

must check one of the boxes in Item 1(b).

If your plan has fewer than 500 participants, check

box 1(b)(1).

If your plan has 500 or more participants, check box

1(b)(2). Your enrolled actuary must sign the certification

on line 11.

Line 2 Present Value Of Vested Benefits

Round entries that include cents down to the next

lower whole dollar amount.

Determination Date

Enter the date as of which the vested benefits for the

1996 Form 5500, Schedule B, line 2b, were valued. That

date must be the first day of the 1996 plan year. If it is

not, you cannot use the Alternative Calculation Method.

Assumed Retirement Age

Enter the assumed retirement age used to determine

the present value of vested benefits for participants and

beneficiaries not receiving payments. The entry must be

the same as the retirement age actuarial assumption

reported on the 1996 Form 5500, Schedule B, line 6b.

Required Interest Rate

Enter the Required Interest Rate (see Part H.7. of

these instructions) that must be used to determine the

adjusted present value of vested benefits.

Accrual Factor

The accrual factor refers to the benefit accrual

adjustment factor of 1.07 that you use in the “Line 2(b)

Procedure.”

Line 2(a)(1) Plan Value Of Vested Benefits -

Those Receiving Payments

In the “Value” column, enter the present value of

vested benefits for retirees and beneficiaries receiving

payments, determined as of the first day of the 1996 plan

year. The amount entered must be the same as the

amount reported on the 1996 Form 5500, Schedule B,

line 2b(1), in the Vested Benefits column, “Operational

information as of beginning of this plan year—‘RPA ’94’

current liability for retired participants and beneficiaries

receiving payments.”

In the “Interest Rate” column, enter the plan interest

rate used to determine the present value of vested

benefits. The interest rate must be the same as the

current liability interest rate reported on the 1996 Form

5500, Schedule B, line 6a(1).

Line 2(a)(2) Plan Value of Vested Benefits -

Those Not Receiving Payments

In the “Value” column, enter the present value of

vested benefits for participants not receiving payments,

determined as of the first day of the 1996 plan year. This

includes all active vested participants and separated

participants with deferred vested benefits. The amount

entered must be the sum of the following two amounts

reported on the 1996 Form 5500, Schedule B:

a. Line 2b(2), in the Vested Benefits column,

“Operational information as of beginning of this plan

year—‘RPA ’94’ current liability for terminated vested

participants,” and

b. Line 2b(3), in the Vested Benefits column,

“Operational information as of beginning of this plan

year—‘RPA ’94’ current liability for active participants.”

In the “Interest Rate” column, enter the plan interest

rate used to determine the present value of vested

benefits. The interest rate must be the same as the

current liability interest rate reported on the 1996 Form

5500, Schedule B, line 6a(1).

Line 2(a)(3) Total Plan Value of Vested Benefits

Enter the total amount of the present value of vested

benefits determined with the plan’s actuarial assumptions. This is the total of line 2(a)(1) plus line (2)(a)(2).

The amount entered must be the same as the amount on

the 1996 Form 5500, Schedule B, line 2b(4) in the Vested

Benefit column, “Operational information as of beginning

of this plan year—‘RPA ’94’ current liability: Total.”

Line 2(b)(1)Adjusted Value of Vested Benefits -

Those Receiving Payments

Enter the adjusted present value of vested benefits

for retirees and beneficiaries receiving payments,

determined by adjusting the amount on line 2(a)(1) of

Schedule A to value the benefits using the Required

Interest Rate. To adjust the value of the benefits, you

must use the formula in the “Line 2(b) Procedure”

following line 2(b)(3) below.

Line 2(b)(2)Adjusted Value of Vested Benefits -

Those Not Receiving Payments

Enter the adjusted present value of vested benefits

for participants not receiving payments, determined by

adjusting the amount on line 2(a)(2) of Schedule A to add

benefit accruals for the plan year preceding the premium

payment year and to value the benefits using the Required Interest Rate. The adjustment for benefit accruals

is 7% of the amount on line 2(a)(2). To add the benefit

accruals and to adjust the value of the benefits using the
26

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

Required Interest Rate, you must use the formula in the

“Line 2(b) Procedure” following line 2(b)(3) (unless you

qualify for the Interest Adjustment Relief Rule described

below).

Line 2(b)(3) Total Adjusted Vested Benefits

Enter the total adjusted vested benefits. This

amount is the total of line 2(b)(1) plus line 2(b)(2).

Line 2(b) Procedure - How To Compute

Adjusted Vested Benefits

 If the Required Interest Rate for your plan

entered on line 2 is equal to or greater than the plan

interest rate entered on lines 2(a)(1) and 2(a)(2), you do

not have to use the formula below to calculate the

adjusted value of vested benefits. However, you must

adjust the amount entered on line 2(a)(2) by multiplying

it by 1.07, the benefit accrual adjustment factor. Enter on

line 2(b)(1) the same amount you entered on line 2(a)(1),

and enter on line 2(b)(2) the adjusted line 2(a)(2) amount.

If you use this relief rule for line 2(b), by signing the

certification in item 10 you are certifying that the adjusted value of vested benefits on line 2(b) is the same as

the plan value of vested benefits on line 2(a) because the

plan interest rate used to value the vested benefits entered

on lines 2(a)(1) and 2(a)(2) was equal to or less than the

Required Interest Rate.

 Use the formula below to compute the

adjusted value of vested benefits that you must enter on

line 2(b)(1), line 2(b)(2) and line 2(b)(3). Enter all

interest rates in the formula as in the following example:

Enter 6.75 percent as “6.75,” not as “.0675.”

The formula adjusts the values of vested benefits for

retired participants and beneficiaries receiving benefit

payments and for other participants not receiving benefits

that you entered on line 2(a)(1) and line 2(a)(2) of PBGC

Schedule A. This information comes from your 1996

Form 5500, Schedule B. The formula adjusts your plan

values to reflect the Required Interest Rate. The formula

also adjusts for benefit accruals during the plan year

preceding the premium payment year. You may wish to

use the spaces provided as a work sheet.

One part of the formula, the expression “.94(RIR - BIR),”

may result in a fractional exponent and will result in a

negative exponent when your plan’s current liability

interest rate is higher than the Required Interest Rate.

You may use an optional procedure to substitute a factor

for this expression. See “Procedure - How To Use

Substitution Factors for the term ‘.94(RIR - BIR)’” below.

Formula for Total Adjusted Vested Benefits (line

2(b)(3)):

VBadj = VBPay x .94(RIR - BIR) +

[VBNonpay x .94(RIR - BIR) x

((100 + BIR) / (100 + RIR))(ARA - 50)]

Note: The VBNonpay amount is the amount entered on

Schedule A line 2(a)(2) multiplied by 1.07 (the benefit

accrual adjustment factor) to reflect accruals during the

preceding plan year.

a. Line 2(b)(1) amount - Adjusted Vested Benefits

for retirees and beneficiaries receiving payments.

Line 2(b)(1) = VBPay x .94(RIR - BIR)

b. Line 2(b)(2) amount - Adjusted Vested Benefits

for participants not receiving payments.

Line 2(b)(2) = VBNonpay x .94(RIR - BIR) x

((100 + BIR) / (100 + RIR))(ARA - 50)

c. Definitions.

1. VBadj is the adjusted vested benefits amount

(as of the first day of the plan year

preceding the premium payment

year) under the Alternative

Calculation Method ........ $ _________

2. VBPay is the amount entered on

line 2(a)(1) ...................... $ _________

3. VBNonpay is the amount entered on line

2(a)(2) multiplied by 1.07 $ _________

4. RIR is the Required Interest Rate

entered on line 2...................______ %

5. BIR is the current liability interest rate

entered on lines 2(a)(1) and 2(a)(2)

in the “Interest Rate” column ______ %

6. ARA is the assumed retirement age

entered on line 2.............. ______ years

How To Use Substitution Factors

for the term “.94(RIR - BIR)”

You may use “substitution factors” in the Alternative Calculation Method interest rate adjustment formula

to replace the term “.94(RIR - BIR).” The use of the “substitution factors” is not required; it is optional.

The use of the “substitution factors” may slightly

overstate the present value of vested benefits and may

overstate the amount of the variable rate premium. The

PBGC has rounded all substitution factors up or down to

produce the higher value of vested benefits. The impact

of this rounding is minimal. At most, the rounding would

overstate the value of vested benefits by less than 1%.

The substitution factors are in Appendix A. Use the

substitution factor in Table A when RIR is equal to or

greater than BIR rounded to the nearest hundredth. Use

the substitution factor in Table B when BIR, rounded to

the nearest hundredth, is greater than RIR.

Line 3 Value of Plan Assets

Line 3(a) Value Of Plan Assets As Of

Determination Date

Enter the first day of the 1996 plan year. This is the

date as of which you must report the value of plan assets.

Enter the value of assets as reported on the 1996

Schedule B, line 1b(2), if the date reported on the

1996 Schedule B, line 1a, is the first day of the 1996
27

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

plan year. But, if that date is not the first day of the 1996

plan year, enter the value of assets as of the first day of

the 1996 plan year, as reported on line 2a of the same

Schedule B. Round an entry that includes cents up to the

next higher whole dollar amount.

Line 3(b) Contribution Receivables In Line 3(a)

Enter the sum of employer and employee contribution receivables that were included in the line 3(a)

amount. Round an entry that includes cents down to the

next lower whole dollar amount. On the 1996 Form

5500, this amount is the sum of Item 31b(1)(a) and

31b(2)(a), current value of plan assets, receivables for

employer and participant contributions as of the beginning of the plan year.

For plans that file a Form 5500-C/R, you may either

calculate the contribution receivables amount (you must

keep a record of your calculations) or you may enter the

sum of the amounts reported on Form 5500-C, Item 27b,

column (a), current value of plan assets, receivables as of

the beginning of the plan year.

NOTE: If the amount in Item 27b, column (a),

includes items in addition to contribution receivables,

this will understate the adjusted value of assets you will

report on line 3(d).

Line 3(c) Discounted Paid Contributions

For plans with fewer than 500 participants, this line

is optional; you may go to line 3(d). If you do not

complete this line, you may understate the adjusted value

of assets you will report on line 3(d). If this would affect

the amount of the variable rate premium that the plan

owes, you may wish to complete line 3(c).

Enter on line 3(c) the discounted value of those

employer and employee contributions paid for plan years

prior to the premium payment year that were reported on

line 3(b) (because they were included as receivables in

the line 3(a) amount) or that were not included (as

receivables or otherwise) in the line 3(a) amount. Do not

include in line 3(c) any contributions that are for the

premium payment year or any contributions that have not

been paid on or before the earlier of the due date for the

variable rate premium or the date that premium is paid.

Round an entry that includes cents up to the next higher

whole dollar amount.

The contributions must be discounted back to the

first day of the 1996 plan year, and the discount rate you

must use is the Required Interest Rate (RIR) entered on

line 2. To discount your contributions, you must use the

formula in the “Line 3 Procedure” below.

Line 3 Procedure - How To Discount

Contributions

You must use the formula below to discount each

contribution included in line 3(c) from the date paid back

to the date entered on line 3(a). The sum of the discounted contributions is entered on line 3(c).

Each “discounted contribution” (DC) is computed

by dividing the contribution paid by the “discount

interest rate factor” for the discount period. The computation of the “discount interest rate factor” is based on the

Required Interest Rate (RIR) entered on line 2. Thus, for

example, if the RIR is 6.30%, the “discount interest rate

factor” is 1.0630. The “discount period” (DP) is the

number of days from the date the contribution was paid

back to the date entered on line 3(a). As part of the

exponent in the formula, the “discount period” adjusts

the “discount interest rate factor” for periods of different

durations. One year is 365/365 or 1. (The formula

assumes a 365-day year.)

Discounted Contribution (DC) =

Contribution / [(1 + (RIR / 100))(DP / 365)]

where:

1. RIR is the Required Interest Rate entered

on line 2 ................................................. ______ %

2. DP is the discount period expressed as

the number of days from the date the

contribution was paid back to the date

entered on line 3(c); for example, one

year and 183 days would be 548 days ... ________

 A calendar year plan paying its premium

for the 1997 premium payment year made a $1,000

contribution on July 2 of the premium payment year for

the prior plan year. The discount period is July 2 of the

premium payment year to January 1 of the prior plan

year, or 548 days. Assume that the RIR for the premium

payment year is 6.30%. When Contribution = $1,000,

RIR = 6.30%, and the Discount Period (DP) = 548 days,

the amount of the Discounted Contribution (DC) is

computed as follows:

DC = $1,000 / [( 1 + (6.30/100)) (548 / 365) ]

DC = $1,000 / [( 1 + 0.0630) (1.50137) ]

DC = $1,000 / [( 1.0630) (1.50137) ]

DC = $1,000 / 1.096065

DC = $912.35

If the discount period for a contribution includes a

partial year, instead of using this formula for the entire

period, you may use simple interest for the partial year

and this formula for the full year(s), if any, in the discount period, and add the two results.

Line 3(d) Adjusted Value Of Plan Assets

Enter the sum of line 3(a) minus line 3(b) plus line 3(c).

Line 4 Adjusted Unfunded Vested Benefits

The Adjusted Unfunded Vested Benefits is the excess,

if any, of the Total Adjusted Vested Benefits entered on line

2(b)(3) over the Adjusted Plan Assets entered on line 3(d),

further adjusted for the passage of time from the determination date entered on line 2 to the last day of the 1996 plan

year. To determine Adjusted Unfunded Vested Benefits,

use the “Line 4 Procedure” below. You may wish to use

the space provided as a work sheet.
28

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

Plans with fewer than 500 participants compute the

Adjusted Unfunded Vested Benefits by using Step 1 and

Step 2 of the “Line 4 Procedure” below and entering the

result (UVBadj) on line 4.

Plans with 500 or more participants compute the

Adjusted Unfunded Vested Benefits by using Step 1,

Step 2 and Step 3 of the “Line 4 Procedure” below and

entering the result (UVBadj) on line 4.

Line 4 Procedure - How To Compute

Adjusted Unfunded Vested Benefits

Step 1. Unfunded Vested Benefits.

A. If line 3(d), Adjusted Value of Plan Assets, is

equal to or greater than line 2(b)(3), Total Adjusted

Vested Benefits, you have no Adjusted Unfunded Vested

Benefits; enter $0 on line 4 and go to line 9.

B. If line 3(d), Adjusted Value of Plan Assets is less

than Line 2(b)(3), Total Adjusted Vested Benefits, you do

have Adjusted Unfunded Vested Benefits. Compute the

amount of Unfunded Vested Benefits as of the determination date entered on line 2 as follows:

1. Total Adjusted Vested Benefits from

line 2(b)(3) ...................................... $ __________

2. Minus: Adjusted Value of Plan

Assets from line 3(d)....................... $ __________

3. Unfunded Vested Benefits

(1 minus 2) ...................................... $ __________

4. Go to Step 2

Step 2. Passage Of Time.

Adjust the Unfunded Vested Benefits entered above

to reflect the passage of time from the determination date

entered on line 2 using the following formula:

UVBadj = (VBadj - Aadj) x (1 + RIR / 100)Y;

where—

1. UVBadj is the amount of the plan’s Adjusted

Unfunded Vested Benefits on which the variable

rate portion of the premium will be assessed.

NOTE: Round up to the next

$1,000 and enter on line 4 .............. $ __________

2. VBadj is the value of the Total

Adjusted Vested Benefits entered

on line 2(b)(3) ................................. $ __________

3. Aadj is the Adjusted Value Of Plan

Assets entered on line 3(d) ............. $ __________

4. RIR is the Required Interest Rate

entered on line 2................................... _______ %

5. Y is deemed to be equal to 1 (unless the

plan year preceding the premium payment

year is a short plan year, in which case Y is

the number of days in the short plan year

(counting both the first day and the last day

of the short plan year) divided by 365,

expressed as a decimal fraction of 1.0 with

two digits to the right of the decimal

point) ............................................ ________ years

If you have a plan with fewer than 500 participants,

skip Step 3 below and go to line 5; otherwise, you must

proceed to Step 3.

Step 3. Significant Event Adjustment.

If you have a plan with 500 or more participants, an

enrolled actuary must certify to either A or B below by

completing the certification on line 11 (including, in

particular, box (d) of Line 11) of the Schedule A.

A. No significant event, as described in Part H.6.

of these instructions, occurred during the plan year

preceding the premium payment year. If this is the case,

enter UVBadj from Step 2 above on line 4.

B. One or more significant events have occurred

during the plan year preceding the premium payment

year, and the enrolled actuary has made appropriate

adjustments to UVBadj from Step 2 above to reflect the

occurrence of the significant event in accordance with

generally accepted actuarial principles and practices. If

this is the case, you may use the following worksheet:

1. Enter UVBadj from Step 2 above .... $ __________

2. Enter the adjustment to UVBadj to

reflect significant events (if negative,

place in parentheses) ....................... $ __________

3. Add 1 and 2, round up to the next

$1,000, and enter here and on line 4 $__________

Line 5 Multiply Line 4 By 0.009

Multiply the Adjusted Unfunded Vested Benefits

amount on line 4 by 0.009 and enter on line 5. If your

plan is NOT a Regulated Public Utility Plan, skip lines

6-8 and enter the amount from line 5 on line 9.

Line 6 The Participant Count

Regulated Public Utility Plans only: Enter the

participant count from Form 1, line 13(a).

Line 7 Divide Line 5 By Line 6

Regulated Public Utility Plans only: Divide the

amount on line 5 by the participant count on line 6 and

enter. Round to the nearest cent. This is the initial per

participant variable rate portion of the premium. If it is

greater than $53, it may be reduced on line 8.

Line 8 Per-Participant Variable Rate

Premium

Regulated Public Utility Plans only: If line 7 is $53

or less, enter the amount from line 7 on line 8. If line 7 is

greater than $53, enter on line 8 the amount from line

(vi) of the Variable Rate Worksheet on page 37.

Line 9 Variable Rate Premium

Enter on line 9 and on Form 1, line 15(b), the

variable rate premium. You have three alternatives:

a. If you checked any box on line 1(c) OR if you

have a plan that has NO Adjusted Unfunded Vested

Benefits shown on line 4, enter $0.

b. If you completed line 5 and your plan is NOT a

Regulated Public Utility Plan, enter the amount on line 5.
29

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

c. Otherwise, multiply line 8 by the participant

count from Schedule A, line 6 and enter the result here.

Line 10 Plan Administrator Certification

As plan administrator, you must sign and date the

certification in the space provided. We may return any

filing that does not have your original signature. See

instructions in Part H.8.

Line 11 Enrolled Actuary Certification

If the plan has 500 or more participants, an enrolled

actuary must sign, date and enter his or her enrollment

number and address in the space provided on the certification, and must initial box (d) on line 11.

Subpart 3 NO VESTED PARTICIPANTS

Line 1 Filing Method

If you use the No Vested Participants filing method,

you must check the box in Item 1(c)(1) and go to line 9.

Line 9 Variable Rate Premium

Enter $0.

Line 10 Plan Administrator Certification

As plan administrator, you must sign and date the

certification in the space provided. We may return any

filing that does not have your original signature. By

signing the certification, you are certifying that no

participant was entitled to a vested benefit under the plan

(by its terms or as required by law) as of the last day of

the preceding plan year (or, if this is a plan to which the

special computation date rule in Part H.3. applies, as of

the first day of the premium payment year). See instructions in Part H.8.

Line 11 Enrolled Actuary Certification

An enrolled actuary’s certification is not required

under this filing method.

Subpart 4 SECTION 412(i) PLANS

Line 1 Filing Method

If you use the filing method for section 412(i) plans,

you must check the box in Item 1(c)(2) and go to line 9.

Line 9 Variable Rate Premium

Enter $0.

Line 10 Plan Administrator Certification

As plan administrator, you must sign and date the

certification in the space provided. We may return any

filing that does not have your original signature. By

signing the certification, you are certifying that the plan

was a plan described in section 412(i) of the Internal

Revenue Code and regulations thereunder at all times

during the preceding plan year (or, if this is a new or

newly covered plan, at all times during the premium

payment year through the due date for the variable rate

premium). See instructions in Part H.8.

Line 11 Enrolled Actuary Certification

An enrolled actuary’s certification is not required

under this filing method.

Subpart 5 FULLY FUNDED SMALL PLANS

Line 1 Filing Method

If you use the filing method for fully funded plans

with fewer than 500 participants, you must check the box

in Item 1(c)(3) and an enrolled actuary must complete

line 11(b). Go to line 9.

Line 9 Variable Rate Premium

Enter $0.

Line 10 Plan Administrator Certification

As plan administrator, you must sign and date the

certification in the space provided. We may return any

filing that does not have your original signature. See

instructions in Part H.8.

Line 11 Enrolled Actuary Certification

An enrolled actuary must complete the certification

on line 11 and must initial the box on line 11(b).

Subpart 6 STANDARD TERMINATIONS

Line 1 Filing Method

If you use the method for plans terminating in

standard terminations, you must check the box in

Item 1(c)(4) and enter the proposed date of plan termination in Item 1(c)(4). Go to line 9.

(NOTE: See Part B.2 for rules on when your

premium obligation ends.)

Line 9 Variable Rate Premium

Enter $0.

Line 10 Plan Administrator Certification

As plan administrator, you must sign and date the

certification in the space provided. We may return any

filing that does not have your original signature. See

instructions in Part H.8.

Line 11 Enrolled Actuary Certification

An enrolled actuary’s certification is not required

under this filing method.

Subpart 7 PLANS AT THE FULL

FUNDING LIMIT

Line 1 Filing Method

If you use the method for plans at the full funding

limit, you must check the box in Item 1(c)(5) and an

enrolled actuary must complete line 11(e). Go to line 9.

Line 9 Variable Rate Premium

Enter $0.

Line 10 Plan Administrator Certification

As plan administrator, you must sign and date the

certification in the space provided. We may return any
30

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

filing that does not have your original signature. See

instructions in Part H.8.

Line 11 Enrolled Actuary Certification

An enrolled actuary must complete the certification

on line 11 and must initial the box on line 11(e).

Subpart 8 PLANS TERMINATING IN

DISTRESS OR INVOLUNTARY

TERMINATIONS

Line 1 Filing Method

If you use the method for plans terminating in a

distress or involuntary termination, check the box in Item

1(d) and enter the proposed date of plan termination (in a

distress termination) or the date of plan termination

sought by the PBGC (in an involuntary termination).

(These dates are both referred to below as the “DOPT.”)

(NOTE: See Part B.2 for rules on when your

premium obligation ends.)

Lines 2 Through 11

The line-by-line instructions for lines 2 through 11

of the Schedule A are the same as under the Alternative

Calculation Method (See Part I, Subpart 2, of these

instructions) subject to the modifications described

below. However, under this Distress/Involuntary Termination Method, you will generally be using data from a

Schedule B for a plan year earlier than the plan year

preceding the premium payment year.

Most of the relevant item numbers on Schedule B

for 1994 and earlier years are different from those on the

1995 and 1996 Schedule B, as indicated in the box

below.

Corresponding Schedule B Line Numbers

1995/1996 Schedule B 1989-1994 Schedule B

1a 8b (date)

1b(2) 8b (value)

2a 6c

2b 6d

2b(1) 6d(i)

2b(2) + 2b(3) 6d(ii) + 6d(iii)

2b(4) 6d(iv)

6a(1)* 12c(i)

6b** 12d

* Line 6c(1) on 1995 Schedule B’s.

** Line 6e on 1995 Schedule B’s.

If you are able to use the same Schedule B as under

the Alternative Calculation Method, which is the 1996

Schedule B for the 1997 premium payment year, the

Distress/Involuntary Termination Method and the

Alternative Calculation Method are almost identical; the

only difference is that the Distress/Involuntary Termination Method may result in a smaller adjustment for

accruals during the plan year preceding the premium

payment year, since it would adjust only up to the DOPT.

(See Modification 2 below.) Thus, if you use the Distress/Involuntary Termination Method with a Schedule B

for the plan year preceding the premium payment year,

you may ignore Modifications 1 and 3 below, and apply

only Modification 2 to the Alternative Calculation

Method.

The modifications, which are generally designed to

reflect and to adjust for the fact that the Schedule B data

were determined as of an earlier date, are as follows:

Modification 1.

Substitute the first day of the plan year of the

Schedule B you are using for the first day of the Alternative Calculation Method Schedule B year.

 A calendar year plan is paying its 1997

premium. The plan has a DOPT of September 1, 1996

and is using data from its 1995 Schedule B to calculate

the variable rate portion of its premium. For this plan -

a. the determination date to be entered on line 2

must be January 1, 1995;

b. the Plan Value of Vested Benefits to be entered

in the “Value” column of line 2(a), as well as the Adjusted Value of Vested Benefits to be entered on line

2(b), must be determined as of January 1, 1995;

c. the determination date to be entered on line 3

must be January 1, 1995;

d. the Value of Plan Assets to be entered on line 3(a)

must be determined as of January 1, 1995;

e. the Contribution Receivables to be entered on

line 3(b) are those that were included as receivables in

the line 3(a) entry as of January 1, 1995;

f. the Discounted Paid Contributions to be entered

on line 3(c) are those contributions for plan years prior to

the premium payment year that were either included as

receivables, or not included (as receivables or otherwise),

in the line 3(a) entry as of January 1, 1995 (provided they

were paid on or before the earlier of the date the 1997

premium is due or paid);

g. the Discounted Paid Contributions to be entered

on line 3(c) must be discounted from the date paid back

to January 1, 1995;

h. the Adjusted Value of Plan Assets to be entered

on line 3(d) must be determined as of January 1, 1995;

i. the Adjusted Unfunded Vested Benefits to be

entered on line 4 is determined as of the last day of the

plan year preceding the premium payment year, i.e.,

December 31, 1996; and

j. for a plan with 500 or more participants, the

Adjusted Unfunded Vested Benefits to be entered on

line 4 must reflect any significant events occurring

between the determination date and the last day of the

plan year preceding the premium payment year, i.e.,

between January 1, 1995, and December 31, 1996.
31

Part I LINE-BY-LINE INSTRUCTIONS FOR SCHEDULE A

Modification 2.

Substitute “the sum of 1 plus the product of .07

times the number of years (rounded to the nearest

hundredth of a year) from the date of the Schedule B data

to the DOPT” for the “1.07 benefit accrual adjustment

factor” in the Line 2(b) “Relief Rule” and the interest

rate adjustment formula under the “Line 2(b) Procedure.”

To compute the number of years, count the number

of days from and including the date of the Schedule B

data to and including the DOPT and divide by 365.

Under the Alternative Calculation Method, the

“1.07 benefit accrual adjustment factor” referred to under

the “Line 2(b) Procedure” serves as a surrogate for

accruals during the plan year preceding the premium

payment year. This surrogate assumes that there has

been exactly one year of accruals (e.g., in the case of a

calendar year plan paying its 1997 premium, accruals

from January 1, 1996, through December 31, 1996).

Under the Distress/Involuntary Termination Method,

however, the accrual period will run from the date of the

Schedule B data to the DOPT.

Using the rule stated in Modification 2, and continuing with the hypothetical plan in Modification 1—

a. Determine VBNonpay in the “Line 2(b) Procedure”

interest rate adjustment formula by multiplying the total

of the amounts entered on lines 2b(2) and 2b(3) of the

1995 Schedule B (if you were using a 1989-1994

Schedule B, the amount entered on lines 6d(ii) and

6d(iii)) by the following benefit accrual adjustment

factor (AC) instead of 1.07 —

AC = 1+ (.07 x (the number of days from January 1,

1995 to September 1, 1996) / 365)

AC = 1+ (.07 x 1.67)

AC = 1+ .12

AC = 1.12

b. If the plan is using the line 2(b) “Relief Rule,”

the Schedule A line 2(b)(2) amount is determined by

multiplying the Schedule A line 2(a)(2) amount by 1.12.

If the plan cannot use the Relief Rule, the VBNonpay

amount (c.3. under the “Line 2(b) Procedure”) is the

amount entered on line 2(a)(2) of Schedule A multiplied

by 1.12.

c. Enter the benefit accrual adjustment factor

of 1.12 as the accrual factor on Schedule A, line 2.

Modification 3.

Substitute “the number of years (rounded to the

nearest hundredth of a year) between the date of the

Schedule B data and the last day of the plan year preceding the premium payment year” for the exponent “Y,” in

the time adjustment formula under the “Line 4 Procedure.”

To compute the number of years, count the number

of days from and including the date of the Schedule B

data to and including the last day of the plan year

preceding the premium payment year and divide by 365

in Step 2 of the “Line 4 Procedure.”

Under the Alternative Calculation Method, the

exponent, “Y,” in the time adjustment formula in Step 2

of the “Line 4 Procedure” represents the length of time

from the date of the Schedule B data to the last day of the

plan year preceding the premium payment year. Because

that length of time is generally exactly one year under the

Alternative Calculation Method, Y is defined simply as

(generally) being “equal to 1.” The length of time under

the Distress/Involuntary Termination Method will

generally be longer than 1 year. Thus, using the rule

stated in Modification 3, and continuing with the

hypothetical plan in Modification 1, “Y” would equal

2 (the number of years between January 1, 1995, and

December 31, 1996).

Subpart 9 SMALL REGULATED PUBLIC

UTILITY PLANS PAYING

MAXIMUM VARIABLE RATE

PREMIUM

Line 1 Filing Method

If you use the filing method for plans paying the

maximum variable rate premium, you must check the box

in Item 1(e), and go to line 8.

Line 8 Per-Participant Variable Rate

Premium

Enter $53.

Line 9 Variable Rate Premium

Multiply the $53 amount on line 8 by the participant

count from Form 1, line 13(a) and enter the result on

line 9.

Line 10 Plan Administrator Certification

As plan administrator, you must sign and date the

certification in the space provided. We may return any

filing that does not have your original signature. See

instructions in Part H.8.

Line 11 Enrolled Actuary Certification

An enrolled actuary’s certification is not required

under this method.
32

APPENDIX A

APPENDIX A Optional Substitution Factors for the term “94(RIR - BIR)”

You may use optional “substitution factors” in the Alternative Calculation Method interest rate adjustment formula

to replace the term “.94(RIR - BIR).” The use of the factors is not required; it is optional. The instructions for the formula

and for use of the tables below are in Part I. Subpart 2, Line 2.

Use the substitution factor in Table A when RIR is equal to or greater than BIR rounded to the nearest hundredth.

Use the substitution factor in Table B when BIR, rounded to the nearest hundredth, is greater than RIR.

TABLE A

When RIR is Equal To Or Greater Than BIR

If RIR minus BIR (rounded to the The If RIR minus BIR (rounded to the The

nearest hundredth) is: substitution nearest hundredth) is: substitution

At Least But less than factor is: At Least But less than factor is:

0.00 0.10 1.0000 3.00 3.10 0.8306

0.10 0.20 0.9938 3.10 3.20 0.8255

0.20 0.30 0.9877 3.20 3.30 0.8204

0.30 0.40 0.9816 3.30 3.40 0.8153

0.40 0.50 0.9756 3.40 3.50 0.8103

0.50 0.60 0.9695 3.50 3.60 0.8053

0.60 0.70 0.9636 3.60 3.70 0.8003

0.70 0.80 0.9576 3.70 3.80 0.7954

0.80 0.90 0.9517 3.80 3.90 0.7905

0.90 1.00 0.9458 3.90 4.00 0.7856

1.00 1.10 0.9400 4.00 4.10 0.7807

1.10 1.20 0.9342 4.10 4.20 0.7759

1.20 1.30 0.9284 4.20 4.30 0.7711

1.30 1.40 0.9227 4.30 4.40 0.7664

1.40 1.50 0.9170 4.40 4.50 0.7617

1.50 1.60 0.9114 4.50 4.60 0.7570

1.60 1.70 0.9057 4.60 4.70 0.7523

1.70 1.80 0.9002 4.70 4.80 0.7477

1.80 1.90 0.8946 4.80 4.90 0.7430

1.90 2.00 0.8891 4.90 5.00 0.7385

2.00 2.10 0.8836 5.00 5.10 0.7339

2.10 2.20 0.8781 5.10 5.20 0.7294

2.20 2.30 0.8727 5.20 5.30 0.7249

2.30 2.40 0.8673 5.30 5.40 0.7204

2.40 2.50 0.8620 5.40 5.50 0.7160

2.50 2.60 0.8567 5.50 5.60 0.7115

2.60 2.70 0.8514 5.60 5.70 0.7072

2.70 2.80 0.8461 5.70 5.80 0.7028

2.80 2.90 0.8409 5.80 5.90 0.6985

2.90 3.00 0.8357 5.90 6.00 0.6942
33

TABLE B

When BIR is Greater Than RIR

If BIR (rounded to the nearest The If BIR (rounded to the nearest The

hundredth) minus RIR is: substitution hundredth) minus RIR is: substitution

At Least But less than factor is: At Least But less than factor is:

0.00 0.10 1.0062 3.00 3.10 1.2114

0.10 0.20 1.0125 3.10 3.20 1.2190

0.20 0.30 1.0187 3.20 3.30 1.2265

0.30 0.40 1.0251 3.30 3.40 1.2341

0.40 0.50 1.0314 3.40 3.50 1.2418

0.50 0.60 1.0378 3.50 3.60 1.2495

0.60 0.70 1.0443 3.60 3.70 1.2573

0.70 0.80 1.0507 3.70 3.80 1.2651

0.80 0.90 1.0573 3.80 3.90 1.2729

0.90 1.00 1.0638 3.90 4.00 1.2808

1.00 1.10 1.0704 4.00 4.10 1.2888

1.10 1.20 1.0771 4.10 4.20 1.2968

1.20 1.30 1.0838 4.20 4.30 1.3048

1.30 1.40 1.0905 4.30 4.40 1.3129

1.40 1.50 1.0973 4.40 4.50 1.3211

1.50 1.60 1.1041 4.50 4.60 1.3293

1.60 1.70 1.1109 4.60 4.70 1.3375

1.70 1.80 1.1178 4.70 4.80 1.3458

1.80 1.90 1.1248 4.80 4.90 1.3542

1.90 2.00 1.1317 4.90 5.00 1.3626

2.00 2.10 1.1388 5.00 5.10 1.3710

2.10 2.20 1.1458 5.10 5.20 1.3795

2.20 2.30 1.1529 5.20 5.30 1.3881

2.30 2.40 1.1601 5.30 5.40 1.3967

2.40 2.50 1.1673 5.40 5.50 1.4054

2.50 2.60 1.1745 5.50 5.60 1.4141

2.60 2.70 1.1818 5.60 5.70 1.4229

2.70 2.80 1.1892 5.70 5.80 1.4317

2.80 2.90 1.1965 5.80 5.90 1.4406

2.90 3.00 1.2040 5.90 6.00 1.4495

APPENDIX A
34

APPENDIX B Codes for Principal Business Activity and Principal Product or Service.

These industry titles and definitions are based, in general, on the Enterprise Standard Industrial Classification

system developed by the Office of Management and Budget, Executive Office of the President, to classify enterprises by

type of activity in which they are engaged. The system follows closely the Standard Industrial Classification used to

classify establishments. (Use only codes from the following list.)

AGRICULTURE, FORESTRY,

AND FISHING

Code

Farms:

0120 Field crop.

0150 Fruit, tree nut, and vegetable.

0180 Horticultural specialty.

0230 Livestock.

0270 Animal specialty.

Agricultural services and forestry:

0740 Veterinary services.

0750 Animal services, except veterinary.

0780 Landscape and horticultural

services.

0790 Other agricultural services.

0800 Forestry.

Fishing, hunting, and trapping:

0930 Commercial fishing, hatcheries and

preserves.

0970 Hunting, trapping, and game

propagation.

MINING

Metal mining:

1010 Iron ores.

1070 Copper, lead and zinc, gold and

silver ores.

1098 Other metal mining.

1150 Coal mining.

Oil and gas extraction:

1330 Crude petroleum, natural gas, and

natural gas liquids.

1380 Oil and gas field services.

Nonmetallic mineral (except fuels)

mining:

1430 Dimension, crushed and broken

stone; sand and gravel.

1498 Other nonmetallic minerals, except

fuels.

CONSTRUCTION

General building contractors and

operative builders:

1510 General building contractors.

1531 Operative builders.

Heavy construction contractors:

1611 Highway and street construction.

1620 Heavy construction, except

highway.

Special trade contractors:

1711 Plumbing, heating, and air

conditioning.

1721 Painting, paper hanging, and

decorating.

1731 Electrical work.

1740 Masonry, stonework, and plastering.

1750 Carpentering and flooring.

1761 Roofing and sheet metal work.

1771 Concrete work.

1781 Water well drilling.

1790 Miscellaneous special trade

contractors.

MANUFACTURING

Food and kindred products:

2010 Meat products.

2020 Dairy products.

2030 Preserved fruits and vegetables.

2040 Grain mill products.

2050 Bakery products.

2060 Sugar and confectionery products.

2081 Malt liquors and malt.

2088 Alcoholic beverages, except malt

liquors and malt.

2089 Bottled soft drinks, and flavoring.

2096 Other food and kindred products.

2100 Tobacco manufacturers.

Textile mill products:

2228 Weaving mills and textile finishing.

2250 Knitting mills.

2298 Other textile mill products.

Apparel and other textile products:

2315 Men’s and boy’s clothing.

2345 Women’s and children’s clothing.

2388 Hats, caps, millinery, fur goods,

and other apparel and accessories.

2390 Misc. fabricated textile products.

Lumber and wood products, except

furniture:

2415 Logging camps and logging

contractors, sawmills and planing

mills.

2430 Millwork, plywood, and related

products.

2498 Other wood products, including

wood buildings and mobile homes.

2500 Furniture and fixtures.

Paper and allied products:

2625 Pulp, paper, and board mills.

2699 Other paper products.

Printing, publishing, and allied

industries:

2710 Newspapers.

2720 Periodicals.

2735 Books, greeting cards, and misc.

publishing.

2799 Commercial and other printing,

and printing trade services.

Chemicals and allied products:

2815 Industrial chemicals, plastics

materials and synthetics.

2830 Drugs.

2840 Soap, cleaners, and toilet goods.

2850 Paints and allied products.

2898 Agricultural and other chemical

products.

Petroleum refining and related

industries (including those integrated

with extraction):

2910 Petroleum refining (including those

integrated with extraction).

2998 Other petroleum and coal products.

Rubber and misc. plastics products:

3050 Rubber products; plastics footwear,

hose and belting.

3070 Misc. plastics products.

Leather and leather products:

3140 Footwear, except rubber.

3198 Other leather and leather products.

Stone, clay, glass, and concrete

products:

3225 Glass products.

3240 Cement, hydraulic.

3270 Concrete, gypsum, and plaster

products.

3298 Other nonmetallic mineral

products.

Primary metal industries:

3370 Ferrous metal industries; misc.

primary metal products.

3380 Nonferrous metal industries.

Fabricated metal products, except

machinery and transportation

equipment:

3410 Metal cans and shipping containers.

3428 Cutlery, hand tools, and hardware;

screw machine products, bolts, and

similar products.

3430 Plumbing and heating, except

electric and warm air.

3440 Fabricated structural metal

products.

3460 Metal forging and stamping.

3470 Coating, engraving, and allied

services.

3480 Ordnance and accessories, except

vehicles and guided missiles.

3490 Misc. fabricated metal products.

Machinery, except electrical:

3520 Farm machinery.

3530 Construction, mining, and materials

handling machinery and equipment.

3540 Metalworking machinery.

3550 Special industry machinery, except

metalworking machinery.

APPENDIX B
35

3560 General industrial machinery.

3570 Office, computing, and accounting

machines.

3598 Engines and turbines, service industry machinery, and other

machinery, except electrical.

Electrical and electronic machinery,

equipment, and supplies:

3630 Household appliances.

3665 Radio, television, and communication equipment.

3670 Electronic components and

accessories.

3698 Other electric equipment.

Transportation equipment:

3710 Motor vehicles and equipment.

3725 Aircraft, guided missiles and parts.

3730 Ship and boat building and

repairing.

3798 Other transportation equipment.

Measuring and controlling instruments;

photographic and medical goods,

watches and clocks:

3815 Scientific instruments and

measuring devices; watches and

clocks.

3845 Optical, medical, and ophthalmic

goods.

3860 Photographic equipment and

supplies.

3998 Other manufacturing products.

TRANSPORTATION,

COMMUNICATION, ELECTRIC,

GAS, AND SANITARY SERVICES

Transportation:

4000 Railroad transportation.

Local and interurban passenger transit:

4121 Taxicabs.

4189 Other passenger transportation.

Trucking and warehousing:

4210 Trucking, local and long distance.

4289 Public warehousing and trucking

terminals.

Other transportation including

transportation services:

4400 Water transportation.

4500 Transportation by air.

4600 Pipelines, except natural gas.

4722 Passenger transportation arrangement.

4723 Freight transportation arrangement.

4799 Other transportation services.

Communication:

4825 Telephone, telegraph, and other

communication services.

4830 Radio and television broadcasting.

Electric, gas, and sanitary services:

4910 Electric services.

4920 Gas production and distribution.

4930 Combination utility services.

4990 Water supply and other sanitary

services.

WHOLESALE TRADE

Durable:

5010 Motor vehicles and automotive

equipment.

5020 Furniture and home furnishings.

5030 Lumber and construction materials.

5040 Sporting, recreational, photographic, and hobby goods, toys,

and supplies.

5050 Metals and minerals, except

petroleum and scrap.

5060 Electrical goods.

5070 Hardware, plumbing and heating

equipment.

5083 Farm machinery and equipment.

5089 Other machinery, equipment, and

supplies.

5098 Other durable goods.

Nondurable:

5110 Paper and paper products.

5129 Drugs, drug proprietaries, and

druggists’ sundries.

5130 Apparel, piece goods, and notions.

5140 Groceries and related products,

except meats and meat products.

5147 Meats and meat products.

5150 Farm-product raw materials.

5160 Chemicals and allied products.

5170 Petroleum and petroleum products.

5180 Alcoholic beverages.

5190 Misc. nondurable goods.

RETAIL TRADE

Building materials, hardware, garden

supply, and mobile home dealers:

5211 Lumber and other building

materials dealers.

5231 Paint, glass, and wallpaper stores.

5251 Hardware stores.

5261 Retail nurseries and garden stores.

5271 Mobile home dealers.

General merchandise:

5331 Variety stores.

5398 Other general merchandise stores.

Food stores:

5411 Grocery stores.

5420 Meat and fish markets and freezer

provisioners.

5431 Fruit stores and vegetable markets.

5441 Candy, nut, and confectionery

stores.

5451 Dairy products stores.

5460 Retail bakeries.

5490 Other food stores.

Automotive dealers and service stations:

5511 New car dealers (franchised).

5521 Used car dealers.

5531 Auto and home supply stores.

5541 Gasoline service stations.

5551 Boat dealers.

5561 Recreational vehicle dealers.

5571 Motorcycle dealers.

5599 Aircraft and other automotive

dealers.

Apparel and accessory stores:

5611 Men’s and boy’s clothing and

furnishings.

5621 Women’s ready-to-wear stores.

5631 Women’s accessory and specialty

stores.

5641 Children’s and infants’ wear stores.

5651 Family clothing stores.

5661 Shoe stores.

5681 Furriers and fur shops.

5699 Other apparel and accessory stores.

Furniture, home furnishings, and

equipment stores:

5712 Furniture stores.

5713 Floor covering stores.

5714 Drapery, curtain, and upholstery

stores.

5719 Home furnishings, except appliances.

5722 Household appliance stores.

5732 Radio and television stores.

5733 Music stores.

Eating and drinking places:

5812 Eating places.

5813 Drinking places.

Miscellaneous retail stores:

5912 Drug stores and proprietary stores.

5921 Liquor stores.

5931 Used merchandise stores.

5941 Sporting goods stores and bicycle

shops.

5942 Book stores.

5943 Stationery stores.

5944 Jewelry stores.

5945 Hobby, toy, and game shops.

5946 Camera and photographic supply

stores.

5947 Gift, novelty, and souvenir shops.

5948 Luggage and leather goods stores.

5949 Sewing, needlework, and piece

goods stores.

5961 Mail order houses.

5962 Merchandising machine operators.

5963 Direct selling organizations.

5982 Fuel and ice dealers (except fuel oil

and bottled gas dealers).

5983 Fuel oil dealers.

5984 Liquefied petroleum gas (bottled

gas).

5992 Florists.

5993 Cigar stores and stands.

5994 News dealers and newsstands.

5996 Other miscellaneous retail stores.

FINANCE, INSURANCE AND

REAL ESTATE

Banking:

6030 Mutual savings banks.

6060 Bank holding companies.

6090 Banks, except mutual savings

banks and bank holding companies.

Credit agencies other than banks:

6120 Savings and loan associations.

6140 Personal credit institutions.

6150 Business credit institutions.

APPENDIX B
36

6199 Other credit agencies.

Security, commodity brokers, dealers,

exchanges, and services:

6212 Security underwriting syndicates.

6218 Security brokers and dealers,

except underwriting syndicates.

6299 Commodity contracts brokers and

dealers; security and commodity

exchanges; and allied services.

Insurance:

6355 Life insurance.

6356 Mutual insurance, except life or

marine and certain fire or flood

insurance companies.

6359 Other insurance companies.

6411 Insurance agents, brokers, and

services.

Real Estate:

6511 Real estate operators (except

developers) and lessors of

buildings.

6516 Lessors of mining, oil and similar

property.

6518 Lessors of railroad property and

other real property.

6531 Real estate agents, brokers and

managers.

6541 Title abstract offices.

6552 Subdividers and developers, except

cemeteries.

6553 Cemetery subdividers and

developers.

6599 Other real estate.

6611 Combined real estate, insurance,

loans and law offices.

Holding and other investment

companies:

6742 Regulated investment companies.

6743 Real estate investment companies.

6744 Small business investment

companies.

6749 Holding and other investment

companies, except bank holding

companies.

SERVICES

Hotels and other lodging places:

7012 Hotels.

7013 Motels, motor motels, and tourist

courts.

7021 Rooming and boarding houses.

7032 Sporting and recreational camps.

7033 Trailer parks and camp sites.

7041 Organizational hotels and lodging

houses on a membership basis.

Personal services:

7215 Coin-operated laundries and dry

cleaning.

7219 Other laundry, cleaning, and

garment services.

7221 Photographic studios, portrait.

7231 Beauty shops.

7241 Barber shops.

7251 Shoe repair and hat cleaning shops.

7261 Funeral services and crematories.

7299 Miscellaneous personal services.

Business services:

7310 Advertising.

7340 Services to buildings.

7370 Computer and data processing

services.

7392 Management, consulting, and

public relations services.

7394 Equipment rental and leasing.

7398 Other business services.

Automotive repair and services:

7510 Automotive rentals and leasing,

without drivers.

7520 Automobile parking.

7531 Automobile top and body repair

shops.

7538 General automobile repair shops.

7539 Other automotive repair shops.

7540 Automotive services, except repair.

Miscellaneous repair services:

7622 Radio and TV repair shops.

7628 Electrical repair shops, except radio

and TV.

7641 Reupholstery and furniture repair.

7680 Other miscellaneous repair shops.

Motion pictures:

7812 Motion picture production,

distribution, and services.

7830 Motion picture theaters.

Amusement and recreation services:

7920 Producers, orchestras, and

entertainers.

7932 Billiard and pool establishments.

7933 Bowling alleys.

7980 Other amusement and recreation

services.

Medical and health services:

8011 Offices of physicians.

8021 Offices of dentists.

8031 Offices of osteopathic physicians.

8041 Offices of chiropractors.

8042 Offices of optometrists.

8048 Registered and practical nurses.

8050 Nursing and personal care

facilities.

8060 Hospitals.

8071 Medical laboratories.

8072 Dental laboratories.

8098 Other medical and health services.

Other Services:

8111 Legal services.

8200 Educational services.

8911 Engineering and architectural

services.

8932 Certified public accountants.

8933 Other accounting, auditing, and

bookkeeping services.

8999 Other services, not elsewhere

classified.

TAX-EXEMPT ORGANIZATIONS

9002 Churches

9319 Other tax-exempt organizations.

9904 Government instrumentality or

agency.

APPENDIX B
37

Variable Rate Worksheet *

For 1997 Plan Years

USE THIS WORKSHEET ONLY IF YOUR PLAN IS

A REGULATED PUBLIC UTILITY PLAN AND THE AMOUNT

ON SCHEDULE A, LINE 7 IS GREATER THAN $53

Use the worksheet below to calculate the per-participant variable rate premium.

(i) Amount from Schedule A, line 7, if greater than $53 ................................______

(ii) $53.00...........................................................................................................$53.00

(iii) Subtract line (ii) from line (i). Enter amount.............................................______

(iv) Enter Regulated Public Utility (RPU) ratio ................................................______

(RPU ratio = the number of RPU participants divided by total participants.)

(See page 2 of instructions.)

Enter 1 if all contributing sponsors maintaining the plan are Regulated Public Utilities.

(v) Multiply line (iii) by line (iv). ....................................................................______

(vi) Per-participant variable rate premium:

Subtract line (v) from line (i).

Enter here and on Schedule A, line 8....................................................______

* KEEP THIS WORKSHEET WITH YOUR PLAN RECORDS.

DO NOT SUBMIT THIS WORKSHEET TO THE PBGC.
38

Required Interest Rate Worksheet *

For Use Only by Regulated Public Utility Plans

with premium payment years beginning July 1 through December 31, 1997, that use filing method

1(a) (General Rule), 1(b) (Alternative Calculation Method), or 1(d) (special method for plans

terminating in distress or involuntary termination with a termination date before the 1997 plan

year) on Schedule A to PBGC Form 1.

Use the worksheet below to calculate the Required Interest Rate to be used in determining the value of vested benefits for purposes of computing the variable-rate premium.

(i) Enter the Required Interest Rate (expressed as a decimal fraction, NOT as a

percentage) for plans that have the same premium payment year as your plan

but are NOT Regulated Public Utility Plans. ........................................................ ______

(ii) Enter the Regulated Public Utility (RPU) ratio..................................................... ______

(RPU ratio = number or RPU participants divided by total number of participants.)

(See page 2 of instructions.)

Enter 1 if all contributing sponsors maintaining the plan are Regulated Public Utilities.

(iii) Divide amount on line (ii) by 17 and enter here ................................................... ______

(iv) Multiply line (i) by line (iii) and enter here .......................................................... ______

(v) Subtract line (iv) from line (i) and enter here ....................................................... ______

This is the Required Interest Rate for your plan.

 Assume your plan has a 7/1-6/30 plan year and a RPU ratio of 0.765. Suppose the

Required Interest Rate for plans with premium payment years beginning in July 1997 that are

NOT Regulated Public Utility Plans is 6.00 percent. Your Required Interest Rate is 5.73 percent,

computed as follows:

LINE ENTRY

(i) 0.06 (6 percent)

(ii) 0.765

(iii) 0.045

(iv) 0.0027

(v) 0.0573 (5.73 percent)

* KEEP THIS WORKSHEET WITH YOUR PLAN RECORDS.

DO NOT SUBMIT THIS WORKSHEET TO THE PBGC.
39

Forms and instructions may be obtained through the following offices of the Pension and Welfare Benefits Administration (PWBA) of the U.S. Department of Labor:

CALIFORNIA

San Francisco 94119-0250

P. O. Box 190250

(415) 975-4600

DISTRICT OF COLUMBIA

Washington 20006

1730 K Street, NW

Suite 556

(202) 254-7013

FLORIDA

Miami 33169

111 NW 183rd Street

Suite 504

(305) 651-6464

GEORGIA

Atlanta 30367

1371 Peachtree St., NE

Suite 205

(404) 347-4090

ILLINOIS

Chicago 60606

200 West Adams

Suite 1600

(312) 353-0900

KENTUCKY

Fort Wright 41011

1885 Dixie Highway

Suite 210

(606) 578-4680

MASSACHUSETTS

Boston 02114

7th Floor

1 Bowdoin Square

(617) 424-4950

MICHIGAN

Detroit 48226-3211

211 Westfort Street

Suite 1310

(313) 226-7450

MISSOURI

Kansas City 64105

1100 Main Street

Suite 1200

(816) 426-5131

St. Louis 63101

815 Olive St., Rm. 338

(314) 539-2691

NEW YORK

New York City 10019

1633 Broadway

Room 226

(212) 399-5191

PENNSYLVANIA

Philadelphia 19104

Gateway Building

3535 Market Street

Room M300

(215) 596-1134

TEXAS

Dallas 75202

Federal Building-Rm 707

525 Griffin Street

(214) 767-6831

WASHINGTON

Seattle 98101-3212

1111 Third Avenue

Room 860

(206) 553-4244

All forms and payments should be mailed to:

Pension Benefit Guaranty Corporation, P.O. Box 64880, Baltimore, MD 21264-4880

BULK MAILING ORDER FORM

We will mail a bulk order of forms to those pension practitioners who need many copies. We will also provide

forms for filing for previous plan years. Please check one or more of the following and enter your address under

“SEND TO”:

1997 Estimated Premium Payment Package (25 copies of Form 1-ES and 1 set of instructions)

1997 Premium Payment Package (50 copies of Form 1 with Schedule A, and 1 set of instructions)

Estimated Premium Payment Package for filing year ________. Number of packages needed ____________.

Premium Payment Package for filing year ___________. Number of packages needed ____________.

SEND TO: ___________________________________________________________

___________________________________________________________

___________________________________________________________

___________________________________________________________

Once you have completed the form above, mail it to:

Pension Benefit Guaranty Corporation

P.O. Box 64916

Baltimore, MD 21264-4916

or Fax your request to: (703) 827-3762
Penalty for private use $300

OFFICIAL BUSINESSAddress Correction RequestedBaltimore, MD 21264-4880P.O. Box 64880Pension Benefit Guaranty Corporation BULK RATE

POSTAGE & FEES

Permit No.

PAID PBGC

G-92