1. 1 NECA LABOR RELATIONS CONFERENCE SAN ANTONIO, TX OCTOBER 12-14, 2009 Presented by: Paul Heylman Dan Brandenburg Saul Ewing LLP Defined Benefit Issues (Mergers & Conversions)

2. 2 Types of Multiemployer Plan Terminations Mass Withdrawals – All employers withdraw or cease to be obligated to contribute Plan Amendment – Plan adopts an amendment providing participants will receive no service credit after a specified date (freeze) or that makes it no longer a covered plan (conversion)

3. 3 Each employer's contribution for each plan year beginning on or after the plan termination date (until full funding is achieved) must equal or exceed the highest rate that employer was obligated to contribute in the five preceding plan years PBGC can approve a lower contribution rate if it finds that the plan is, or soon will be, fully funded. Plan Termination as a Result of Freeze or Conversion

4. 4 Plan Termination as a Result of a Mass Withdrawal All or substantially all employers withdraw Look-back provisions (three years) Limits on payment of benefits Ancillary benefit payments must cease PBGC rules govern

5. 5 Merger and Asset Transfers to another Multi-Employer Plan 120 day advance notice to PBGC No immediate reduction in accrued benefits Actuarial valuations for both plans New plan must be viable PBGC compliance determination

6. 6 Mergers and Transfers Between Multi- Employer and Single Employer No immediate reduction in accrued benefits Must have sponsor consent PBGC guarantee may be better PBGC notice Five year look-back

7. 7 Considerations of DB and DC Plans “Guaranteed” income Pooled liability Investment management Withdrawal liability Last man standing Investment risk on employee Predictable contributions Outlive benefit No PBGC insurance Lump sums

8. 8 CONTACT INFORMATION Paul Heylman, Esquire 2600 Virginia Avenue, N.W. Suite 1000 – The Watergate Washington, DC 20037-1922 Phone: 202.342.3422 Fax: 202.295.6773 Email: pheylman@saul.compheylman@saul.com Dan Brandenburg, Esquire 2600 Virginia Avenue, N.W. Suite 1000 – The Watergate Washington, DC 20037-1922 Phone: 202.295.6644 Fax: 202.295.6773 Email: dbrandenburg@saul.comdbrandenburg@saul.com

9. 9 Saul Ewing’s Office Locations Baltimore, Maryland Lockwood Place 500 East Pratt Street, Suite 900 Baltimore, MD 21202 410.332.8600 fax: 410.332.8862 Chesterbrook, Pennsylvania 1200 Liberty Ridge Drive, Suite 200 Wayne, PA 19087-5569 610.251.5050 fax: 610.651.5930 Harrisburg, Pennsylvania Penn National Insurance Tower Two North Second Street, 7th Floor Harrisburg, PA 17101-1604 717.257.7500 fax: 717.238.4622 Newark, New Jersey One Riverfront Plaza Newark, NJ 07102 973.286.6700 fax: 973.286.6800 New York, New York 245 Park Avenue, 24th Floor New York, NY 10167 212.672.1995 Fax: 212.372.8798 Philadelphia, Pennsylvania Centre Square West 1500 Market Street, 38th Floor Philadelphia, PA 19102-2186 215.972.7777 fax: 215.972.7725 Princeton, New Jersey 750 College Road East Princeton, NJ 08540 609.452.3100 fax: 609.452.3122 Wilmington, Delaware 222 Delaware Avenue, Suite 1200 Wilmington, DE 19801-1611 302.421.6800 fax: 302.421.6813 Washington, D.C. 2600 Virginia Avenue, N.W. Suite 1000 | The Watergate Washington, D.C. 20037 202.333.8800 fax: 202.337.6065