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Yearly Statements Mailed to SMPPP Participants

May 2007

The mailing of annual statements from the Seafarers Money Purchase Pension Plan (SMPPP) to Plan participants was completed last month, according to SMPPP Administrator Margaret Bowen. Based on year-end reports received from Morgan Stanley Dean Witter, SMPPP investment manager, the Plan continues to perform well despite ongoing market volatility. Interest earned on the accounts during 2006 was 10.16 percent; the total amount in all accounts was more than $49.6 million. The SMPPP originated in 1996, as the SIU successfully negotiated the new benefit into the standard freightship and tanker agreements. The SMPPP subsequently has been included in other SIU contracts. Approved by the Internal Revenue Service, the SMPPP is an individual interest-earning investment account funded by a daily contribution made by an SIU-contracted company on behalf of a Seafarer who is working for that employer. SIU members may make voluntary contributions to their respective accounts through a Vacation Plan deduction or via checks sent directly to the Plan. The SMPPP is completely separate from a member’s defined benefit pension. Under the SMPPP, members who became participants on or after July 1, 2006 and who have completed at least three years of service have a right to a percentage of their “Employer Contribution Account” as follows: three years of service equals 50 percent; four years of service equals 75 percent; five or more years of service equals 100 percent. Participants are immediately vested for the employee contribution segment of their respective accounts as soon as the first such contribution is made. Those who became participants before July 1, 2006 were vested from the first day money was received on their behalf. Unlike the Seafarers Pension Plan, there is no minimum amount of sea time needed to receive the money from an SMPPP account. Seafarers can collect the funds from their SMPPP account when they reach retirement age, become totally and permanently disabled, or leave the industry. Widows/widowers may collect the funds in the event of their spouse’s death.