More About The Retirement Plan

Any benefit payments you receive from the Retirement Plan attributable to A&B’s contributions will be considered ordinary taxable income to you at the time you receive them. Therefore, as explained previously under Forms of Payment, if you elect a lump sum payout, you will be taxed on the full value of your Retirement Plan benefit unless you elect to defer taxes by rolling over your benefit into another employer’s plan (if the plan accepts such rollovers) or an IRA. (See If You Leave A&B Before Retirement Age for more details on rolling over your benefit payment.)

You should consult a qualified tax advisor or the IRS to determine the exact consequences of any distribution you receive. Also, please keep in mind that taxation regulations differ from state to state. Again, you may want to consult a qualified tax advisor or your state tax office.

It’s important that you designate a beneficiary to your Retirement Plan benefit. Your beneficiary is the individual(s) who receives your retirement benefit in the event you die after you are vested but before receiving this benefit.

If you are…

• Married, your beneficiary is automatically your spouse; or,

• Single, your beneficiary may be your domestic partner, a child or children, or other individual. If you do not designate a beneficiary, your beneficiary will automatically be your surviving children (in equal shares) or, if none, your estate.

At the time you begin receiving your Retirement Plan benefit, you can elect a Joint and Survivor Annuity form and change this designation to elect another individual as your contingent annuitant. This is the individual who, if you elect any of the Joint and Survivor Annuity payment options, will continue to receive all or a percentage of your monthly benefit after your death.

Again, if you are married, your contingent annuitant is automatically your spouse unless your spouse consents to changing this designation. If you are not married, you can name anyone to be your contingent annuitant, but IRS regulations may limit your ability to elect Options 2 or 4 if your contingent annuitant is an individual other than a spouse and he or she is significantly younger than you.

Alexander & Baldwin, Inc. is the Plan Administrator, and is responsible for the day-to-day administration and operation of the Retirement Plan. The Plan Administrator will interpret Retirement Plan provisions, establish rules and regulations, and review any claims for benefits filed by participants and beneficiaries. The Plan Administrator also maintains records of all plan transactions.

Generally, you may not assign or transfer your right to receive benefits under the Retirement Plan, nor may you use your right to benefits as collateral for any loan. Similarly, your benefits are not subject to any creditors' claims or to attachment by legal process (other than federal tax levies and judgments).

Retirement Plan benefits, however, may be applied to the satisfaction of child support and alimony claims in accordance with a Qualified Domestic Relations Order (QDRO). The QDRO must relate to child support, alimony payment or marital property rights. The Plan Administrator will notify you if a QDRO relating to your benefits is received, along with the procedures for determining and processing the order.

The Internal Revenue Code (IRC) limits the amount of compensation that may be used to calculate your benefit as well as the annual benefit payable under the Retirement Plan. The limitations in 2009 are $245,000 for compensation and $195,000 for annual pension benefits. These amounts are subject to change from year to year; you may contact your local Human Resources representative to find out the current year's maximums.

To receive benefits from the Retirement Plan, you must file a written application with the Plan Administrator. The Plan Administrator will provide you with the appropriate forms at least 30 days before you become entitled to your benefits.

You may file your application for benefits (including your election of the form of payment) as early as 90 days before your retirement date, but generally not later than 30 days before your benefit would commence. If your notification to the Plan Administrator of your retirement date and application for benefits is less than 30 days, you must sign a form stating that you agree to waive the 30-day notice period from the Plan Administrator. 

Note: To ensure timely notification of benefit eligibility, you should notify the Plan Administrator any time your address changes.

For information regarding how to appeal a decision with regard to your retirement benefit amount, refer to Claim Procedures.

Your pension benefits under the Retirement Plan are insured by the Pension Benefit Guaranty Corporation (PBGC), a Federal insurance agency. If the Retirement Plan terminates (ends) without enough money to pay all benefits, the PBGC will step in to pay pension benefits. In such situations, most people receive all of the pension benefits they would have received under their pension plan, but some people may lose certain benefits.

The PBGC guarantee generally covers...

• Normal and early retirement benefits,

• Disability benefits, if you become disabled before the plan terminates; and,

• Certain benefits for survivors.

The PBGC guarantee generally does not cover...

• Benefits greater than the maximum guaranteed amount set by law for the year in which the plan terminates

• Some or all of benefit increases and new benefits based on plan provisions that have been in place fewer than five years at the time the plan terminates

• Benefits that are not vested because you have not worked long enough for the Company to be vested

• Benefits for which you have not met all of the requirements at the time the plan terminates

• Certain early retirement payments (such as supplemental benefits that end when you become eligible for Social Security) that result in a monthly early retirement benefit greater than your monthly benefit at the plan's normal retirement age

• Non-pension benefits, such as health insurance, life insurance, certain death benefits, vacation pay, and severance pay; this also includes any benefits payable under a 401(k) or profit sharing plan, such as the A&B Individual Deferred Compensation (IDC) and Profit Sharing Retirement (PSR) Plans.

Even if certain of your pension plan benefits are not guaranteed, you still may receive some of those benefits from the PBGC, depending on two factors: how much money your plan has and how much the PBGC collects from employers.

For more information about the PBGC and the benefits it guarantees, contact the A&B Human Resources Department at 808-525-6611 (822 Bishop Street, Honolulu, HI 96813) or contact the PBGC at:

PBGC Technical Assistance Division, 1200 K Street N.W., Suite 930 Washington D.C. 20005-4026; 202-326-4000. (TTY/TDD users may call the Federal relay service toll-free number at 800-877-8339 and ask to be connected to the PBGC's number.)

Additional information about the PBGC's pension insurance program is available through the PBGC's website at www.pbgc.gov.