(3) The object of the Fund shall be to provide benefits for its MEMBERS on their retirement, and in the event of their death or permanent disablement.

(4) The Fund shall consist of:‑

(a) contributions paid to it in terms of the AGREEMENT, as described in Rule 4;

(b) interest and capital gains derived from the investment of its moneys;

(c) money or other assets transferred to it from any other APPROVED PROVIDENT FUND, APPROVED PENSION FUND, PRESERVATION PROVIDENT FUND or PRESERVATION PENSION FUND;

(d) any moneys or other assets lawfully acquired from any other source whatsoever.

(5) The Fund in its own name shall be capable of suing and being sued and of purchasing or otherwise acquiring, holding and alienating property, movable or immovable, or any interest therein.

(6) The Fund may, subject to the provisions of section 14 of the ACT, amalgamate with, or transfer its assets and liabilities or part thereof to, or take transfer of the assets and liabilities or part thereof of any other APROVED PROVIDENT FUND or APPROVED PENSION FUND.

(7) For all purposes, including any legal proceedings for or against the Fund, the Fund shall be represented by the BOARD.

(8) If the registration of these RULES in terms of the ACT is effected later than 3 July 1995, the RULES shall nevertheless take effect from 3 July 1995.

RULE 2 – DEFINITIONS

In the interpretation of these RULES, words defined in the ACT and not in the RULES shall have the meanings assigned to them in the ACT, words importing the masculine gender shall include the feminine and vice versa, and unless inconsistent with the context, the following words shall have the following meanings:‑

"ACT" shall mean the Pension Funds Act, 1956 as amended, and the regulations framed thereunder.

"ACTUARY" shall mean the ACTUARY appointed in terms of these RULES.

"AGREEMENT" shall mean the current Industrial Agreement (including any amendments of it) relating specifically to the Fund, or in the absence of such an AGREEMENT, the last Industrial Agreement (including any amendments to it) in force relating specifically to the Fund, entered into between the parties to the National Industrial Council for the MOTOR INDUSTRY and approved by the Minister of Labour in terms of the Labour Relations Act.

"AUDITOR" shall mean an AUDITOR registered under the Public Accountants' and Auditors' Act, 1991 (as amended) appointed in terms of these RULES.

"BOARD" shall mean the BOARD of Management which is responsible for the operation of the Fund in terms of these RULES.

"COUNCIL" shall mean the Motor Industry Bargaining Council registered in terms of Chapter III Section 29 of the Labour Relations Act.

"EMPLOYER" shall mean an EMPLOYER of a MEMBER of the Fund.

"EMPLOYER'S PORTION" shall mean in relation to a MEMBER at any particular date an amount equal to the sum of:

(A) a future service benefit equal to the accumulated value of :

(a) the amounts applied in terms of Rule 5(4) as the EMPLOYER’S current contributions; and

(b) any amounts required to be credited in terms of Rule 5(8)(c), Rule 5(9)(c) and Rule 5(10)(c),

increased or decreased throughout his membership of the Fund at the same rate as that applied to the MEMBER’S PORTION,

and; in the case of a MEMBER who was a MEMBER of the PENSION FUND and to whom the provisions of Rule 5.3 apply:‑

(B) (a) a past service benefit equal to the amount transferred from the PENSION FUND on the MEMBER’s behalf;

(b) such benefit being reduced at the date of its transfer into the Fund by an amount equal to the MEMBER's benefit on his withdrawal from membership of the PENSION FUND at that date; and

(c) such reduced benefit being increased or decreased throughout his membership of the Fund at such rate that the BOARD in their reasonable discretion, after consulting the ACTUARY, shall from time to time determine, at least annually, effective each FINANCIAL YEAR having regard to the investment earnings on the Fund’s assets.

"FINANCIAL YEAR" shall mean each twelve-month period ending on 31 March.

"FUND CREDIT" shall mean for each MEMBER at any particular date the sum of:

(a) his MEMBER’S PORTION;

and

(b) his EMPLOYER’S PORTION.

"MEMBER" shall mean any employee contributing to the Fund in terms of the AGREEMENT; provided however that the BOARD may, in its discretion, extend the membership of a MEMBER during periods of temporary unemployment.

"MEMBER’S PORTION" shall mean in relation to a MEMBER at any particular date the accumulated value of :

(a) the amounts applied in terms of Rule 5(1) as the MEMBER’S current contributions;

(b) the amounts applied in terms of Rules 5(2)(b) and 5(3)(c) as the MEMBER’S additional contributions;

(d) any amounts required to be credited in terms of Rule 5(8)(c), Rule 5(9)(c) and Rule 5(10)(c),

Increased or decreased throughout his membership of the Fund at such rate that the BOARD in their reasonable discretion, after consulting the ACTUARY, shall from time to time determine, at least annually, effective each FINANCIAL YEAR having regard to the investment earnings of the Fund’s assets.

"MOTOR INDUSTRY" shall mean the Motor Industry as defined in the main AGREEMENT from time to time.

"NORMAL RETIREMENT AGE" shall mean age 65 years.

"PENSION FUND" shall mean the Auto Workers’ Pension Fund and the Motor Industry Pension Fund.

"REMUNERATION" shall mean a MEMBER's pensionable REMUNERATION in terms of the AGREEMENT and where contributions are paid on a lesser amount, then the benefits payable will be calculated on such lesser amount.

"REGISTRAR" shall mean the Registrar of Pension Funds appointed in terms of the ACT.

"REVENUE AUTHORITIES" shall mean the South African Revenue Service.

"RULES" shall mean the RULES of the Fund for the time being. Where there is a divergence between the English text and the text in any other language, the English text will prevail.

“SURPLUS APPORTIONMENT DATE” shall mean 31 March 2004.

“APPROVED PENSION FUND” shall mean a pension fund, other than a PRESERVATION PENSION FUND, approved as such by the REVENUE AUTHORITIES for the purposes of these RULES.

“APPROVED PROVIDENT FUND” shall mean a provident fund, other than a PRESERVATION PROVIDENT FUND, approved as such by the REVENUE AUTHORITIES for the purposes of these RULES.

“APPROVED RETIREMENT ANNUITY FUND” shall mean a retirement annuity fund approved as such by the REVENUE AUTHORITIES for the purposes of these RULES.

“PRESERVATION PENSION FUND” shall mean an APPROVED PENSION FUND recognised as a preservation fund, subject to the conditions set out by the REVENUE AUTHORITIES from time to time.

“PRESERVATION PROVIDENT FUND” shall mean an APPROVED PROVIDENT FUND recognised as a preservation fund, subject to the conditions set out by the REVENUE AUTHORITIES from time to time.

“DEFERRED BENEFICIARY” shall mean a MEMBER whose benefit is retained in the Fund in terms of Rule 6(12).

RULE 3 – ADMINISTRATION

Membership of

BOARD

Alternates

Meetings of the

BOARD

Quorum

Resolutions in

writing

Control by BOARD

(1) The membership of the BOARD shall consist of seven persons. One member each shall be appointed by the National Executive Committees of the Motor Industry Employees Union, the Motor Industry Staff Association, and the National Union of Metal Workers of South Africa. Two members shall be appointed by the National Executive Committees of the Retail Motor Industry Organisation. In addition the president of the Motor Industry Bargaining Council shall ex-officio be a member of the BOARD. The seventh member, who shall be the Chairman of the BOARD, shall be elected by the six appointed members of the BOARD.

2) Each of the Unions and the Employer Organisation referred to in Clause (1) above shall appoint an alternate to its representative(s) on the BOARD. The alternate to the President of the Motor Industry Bargaining Council shall be the general secretary of the COUNCIL.

The Chairman shall have no alternate and in the absence of the Chairman from any meeting the members of the BOARD who are present shall elect one of their number to act as Chairman for that meeting.

(3) Meetings of the BOARD shall take place as and when required by the members of the BOARD, but not less frequently than once every two months.

(4) The quorum at any meeting of the BOARD shall be four members of the BOARD, including the alternates of any members who are not present at the meeting. No resolution by the BOARD at such meeting shall be effective unless unanimously agreed upon by all members present at the meeting, including the alternates of any members who are not present at the meeting.

(5) A Resolution in writing signed by all the members of the BOARD who may at the time be present in the town where the registered office of the Fund is situated, being not less than are sufficient to form a quorum, shall be as valid and effectual as if it had been passed at a meeting of the BOARD duly called and constituted, provided that where any such member is not so present but has an alternate who is present, then such Resolution must also be signed by such alternate.

(6) The control of the assets, management and administration of the Fund shall be vested in the BOARD; provided that the BOARD may delegate its power to manage the assets of the Fund, on such terms and conditions not inconsistent with the RULES as the BOARD may determine in its discretion, to

(a) a financial institution as defined in the Financial Institutions (Investment of Funds) Act, 1984;

(b) a person approved in terms of section 4(1) (f) of the Stock Exchanges Control Act, 1985.

The BOARD shall not be liable for the negligence, dishonesty or fraud of an institution referred to in (a) or a person referred to in (b).

BOARD as Trustee

(7) The BOARD shall act as Trustee for the Fund.

Principal Officer

(8) The BOARD shall appoint a principal officer in terms of the ACT and may withdraw any such appointment and make another appointment in its place at any time. If the principal officer is absent from the Republic of South Africa or is otherwise unable to perform his duties, the BOARD shall within 30 days appoint another person to act as principal officer for the period of his absence or inability. To this end the BOARD may appoint such administration organisation to administer the Fund as the BOARD in its discretion deems fit. In its discretion the BOARD may from time to time revoke or review the appointment of such organisation.

Indemnification

(9) (a) The Fund hereby indemnifies the BOARD and each of the members of the BOARD from and hold them harmless against all claims, costs, damages and expenses which are claimed from or incurred by the BOARD and/or any such member relating directly or indirectly to the administration and/or management of the Fund, provided that such claims, costs, damages and/or expenses do not arise from any negligence of, or fraud on the part of the member against whom such claim is made

Insurance

(b) The BOARD shall insure the Fund against loss resulting from fraud and/or dishonesty of any of its officers, for such amounts as the BOARD, in its discretion, may from time to time determine.

BOARD – discretion to reinsure

(c) The BOARD may, in its discretion, reinsure with a third party all, or such a portion of the benefits granted by the Fund as it may decide, on such terms and conditions as it may from time to time deem fit.

Appointment of

AUDITOR

(10) (a) The BOARD shall appoint an AUDITOR of the Fund. Such appointment may be terminated by either party by giving three calendar months' written notice to the other party.

Annual audited

accounts

(b) The BOARD shall cause full and true accounts of the Fund to be kept and financial statements to be made up annually as at the end of each FINANCIAL YEAR and it shall cause such financial statements to be audited by the AUDITOR. A copy of the financial statements shall be available for inspection by MEMBERS and EMPLOYERS.

Banking and/or

other accounts

(11) (a) All moneys received on account of the Fund shall be paid into a banking account or deposit account opened in the name of the Fund with such bank or registered financial institution as the BOARD may determine; and all operations on such accounts shall be by means of cheques or other instruments signed by such person/s as are duly authorised by the BOARD.

Investments and

registration of assets

(b) Moneys of the Fund, which are not immediately required may from time to time be lent, invested, placed on deposit or otherwise dealt with by the BOARD alone upon such security and in such a manner as it, in its discretion, may determine, and may in particular be advanced on the security of first mortgage bonds on immovable property provided that any advance on first mortgage shall not exceed 90% of the market value of the immovable property concerned as assessed on the date of the advance.

The BOARD may realise, vary, re‑invest or otherwise deal with such moneys, securities and investments as it may from time to time, in its discretion, decide.

All title deeds, securities and other assets shall be registered in the name of the Fund or in the name of such nominee Company acceptable to the REGISTRAR as the BOARD may appoint.

Borrowings

(c) The BOARD may obtain overdraft facilities from a bank or borrow money from any person, institution or other fund on such terms and conditions as it may decide, for any purpose it may deem necessary or desirable in the interests of the Fund, and with that object it may pledge or otherwise hypothecate any or all of its assets; provided that the aggregate of such loans shall not at any time exceed 50% of the Fund's gross income from all sources during the immediately preceding FINANCIAL YEAR.

Appointment of

ACTUARY

(12) (a) The BOARD shall appoint an ACTUARY to the Fund. Such appointment may be terminated by either party by giving three calendar months' written notice to the other party.

Actuarial valuation

(b) The BOARD shall cause the financial position of the Fund to be investigated and reported upon by the ACTUARY at intervals not exceeding three years. The ACTUARY shall embody the results of each such actuarial investigation in a written report to the BOARD, in which he shall make such recommendations as he considers desirable to enable the Fund to continue the benefits provided for under these RULES.

Incidental

Expenses

(13) The expenses in connection with, or incidental to, the management of the Fund, including the cost of audit and of actuarial investigations described in sub‑Rules (10) and (12) above, shall be borne by the Fund.

BOARD's powers

relative to Fund's

registration

(14) The BOARD shall be empowered to do such acts and to execute such documents as may be necessary to incorporate and register the Fund.

Contracts and

Conditions of

membership

(1) The conditions of membership of the Fund shall be those contained in the AGREEMENT together with those set out in sub‑Rule 2 below.

Limitation of

Disability Benefits

(2) All benefits shall be payable in full from the outset of membership, save that, in the event of a claim for benefits in terms of Rule 6(4), such benefits, except for those in terms of Rule 6(4)(b), shall subject to the discretion of the Trustees be limited to nil in the first year of membership; 20% of the full benefits in the second year; 40% in the third year; 60% in the fourth year; 80% in the fifth year; and 100% of the full benefits once the member has completed five years of membership. Provided that, if the condition giving rise to the claim has arisen from an accident which occurred after the commencement of membership of the Fund and which in the sole and absolute discretion of the BOARD was a bona fide accident and in addition was not caused by a medical condition from which the MEMBER was suffering, then the above limitations shall fall away.

State of health ‑

concealed in-

formation

MEMBER ceased

paying contributions

(3) If any MEMBER has knowingly withheld or concealed any information regarding his state of health, or has given incorrect information, then he and any persons claiming by virtue of his membership shall forfeit all rights to benefits under the Fund and he and such persons shall upon his ceasing to be a member of the Fund be paid only a benefit in terms of the provisions of Rule 6(9).

(4) If a MEMBER has ceased paying contributions to the Fund following termination of his employment, as advised by the EMPLOYER in terms of the AGREEMENT, which termination shall not be attributable to ill-health or accident, then he and his DEPENDANTS shall not be entitled to the ill-health benefit in terms of Rule 6(4)(a) or the death benefit in terms of Rule 6(7)(a).

RULE 5 – CONTRIBUTIONS

Conditions

(1) The conditions of membership governing the payment of contributions to the Fund shall be those contained in the AGREEMENT. The normal MEMBER's contributions paid in terms of the AGREEMENT shall be referred to as the MEMBER’s current contributions.

Additional

Contributions

(2) (a) In addition to the contributions prescribed in the AGREEMENT,

(i) a MEMBER may, subject to the consent of the BOARD, make such contributions, regular in rate and frequency of payment, as he may agree with the BOARD;

(ii) a MEMBER who, immediately prior to becoming a MEMBER, was a MEMBER of any other APPROVED PROVIDENT FUND, APPROVED PENSION FUND, PRESERVATION PROVIDENT FUND or PRESERVATION PENSION FUND, may transfer the benefit to which he became entitled on leaving that fund into the Fund.

(b) Amounts paid to the Fund in terms of (a) shall be applied as the MEMBER'S additional contributions.

MEMBER's

transferred

benefits from

PENSION FUND

(3) (a) In the case of each MEMBER who was a MEMBER of the PENSION FUND and does not elect that such benefit shall be retained in that fund, the Fund shall receive the benefit to which the MEMBER became entitled on ceasing to be a MEMBER of that fund, after payment of any income tax due thereon.

(b) That part of an amount received in terms of (a) which is notified to the BOARD by the PENSION FUND as representing the contributions made by the MEMBER of that fund in accordance with the provisions of the Industrial Agreement relating to that fund, increased by such interest (if any) as was added thereto under that fund but reduced by such income tax as was apportioned thereto by that fund, shall be applied as the MEMBER'S transferred contributions.

(c) The remainder (if any) of the amount received in terms of (a) shall be applied as the MEMBER'S additional contributions.

EMPLOYER's

Contributions

(4) The EMPLOYER shall contribute in respect of the MEMBER at the rate contained in the AGREEMENT. The allocation of these contributions between the EMPLOYER’s current contributions, which shall be credited to the EMPLOYER’s PORTION`, the contributions to be applied to provide the death benefits in terms of Rule 6.7 (a) and the ill-health retirement benefit in terms of Rule 6.4 (a), and the contributions to be applied towards the Fund’s administration expenses shall be determined by the BOARD from time to time.

Benefits shall be

reduced

(5) If amounts applied in terms of Rule 5(4) in the provision of the death benefit referred to in Rule 6(7)(a) and the ill-health retirement benefit referred to in Rule 6(4)(a) are at any time in excess of the amounts required to provide those benefits, the excess shall be applied under the Risk Reserve Account. If such amounts are at any time insufficient to provide those benefits, the BOARD may decide that the deficit shall be met by drawing all or part of the amount required to meet the deficit from the Risk Reserve Account. Otherwise those benefits shall be reduced to the level of benefit which can be secured by the amounts available.

Remainder of assets transferred from

PENSION FUND

(6) Of the amounts to received, such amount at relates in respect of

each MEMBER to the part service benefit referred to in item (B) of the definition “EMPLOYER’S PORTION” in Rule 2 shall be applied under the EMPLOYER’S PORTION in respect of that MEMBER and any amount remaining shall be applied under the Data Reserve Account, Risk Reserve Account and Investment Reserve Account in such proportions as determined by the BOARD acting on the advice of the ACTUARY.

FUND accounts

(7) The BOARD shall establish such accounts as are allowed by legislation, including a Data Reserve Account, Risk Reserve Account, Expense Reserve Account and Investment Reserve Account, as more fully described in sub-rules (8), (9), (10) and (11) below.

DATA Reserve Account

(8) (a) A Data Reserve Account shall be maintained under the Fund, to which shall be credited :

(i) an opening balance as determined by the BOARD on the recommendation of the ACTUARY as at the SURPLUS APPORTIONMENT DATE;

(ii) any amounts which may arise as a result of data or administrative errors;

(iii) any amounts required to be credited in terms of Rule 5(6);

(iv) investment earnings transferred from the Investment Reserve Account from time to time, as determined by the BOARD, acting on the advice of the ACTUARY.

(b) The Data Reserve Account shall be debited with :

(i) costs payable by the Fund as a result of data or administrative errors;

(ii) negative adjustments to investment earnings, transferred to the Investment Reserve Account as determined by the BOARD after consulting with the ACTUARY.

(c) As at the end of each FINANCIAL YEAR, the Data Reserve Account shall be reviewed and if the amount standing to the credit of the Data Reserve Account exceeds the amount required as decided by the BOARD acting on the advice of the ACTUARY, the excess shall be applied to increase the EMPLOYER’S PORTION and the MEMBER’S PORTION of MEMBERS on such equitable basis as decided by the BOARD in consultation with the ACTUARY.

(d) The Data Reserve Account shall not be allocated proportionately on the exit of any MEMBER or group of MEMBERS, but may become payable to MEMBERS from time to time, at the discretion of the BOARD, in consultation with the ACTUARY.

Risk Reserve

Account

(9) (a) A Risk Reserve Account shall be maintained under the Fund, to which shall be credited :

(i) the EMPLOYER’S PORTION in respect of a MEMBER to whom Rule 6(4) or Rule 6(7) applies;

(ii) any amounts required to be credited in terms of Rule 5(4);

(iii) any amounts required to be credited in terms of Rule 5(6);

(iv) investment earnings transferred from the Investment Reserve Account from time to time, as determined by the BOARD, acting on the advice of the ACTUARY.

(b) The Risk Reserve Account shall be debited with :

(i) where so decided by the BOARD, amounts to meet all or part of a deficit referred to in Rule 5(5);

(ii) negative adjustments to investment earnings, transferred to the Investment Reserve Account as determined by the BOARD after consultation with the ACTUARY.

(c) As at the end of each FINANCIAL YEAR, the Risk Reserve Account shall be reviewed and if the amount standing to the credit of the Risk Reserve Account exceeds the amount required as decided by the BOARD acting on the advice of the ACTUARY, the excess shall be applied to increase the EMPLOYER’S PORTION and the MEMBER’S PORTION of MEMBERS on such equitable basis as decided by the BOARD in consultation with the ACTUARY.

(d) The Risk Reserve Account shall not be allocated proportionately on the exit of any MEMBER or group of MEMBERS, but may become payable to MEMBERS from time to time, at the discretion of the BOARD, in consultation with the ACTUARY.

Expense Reserve Account

(10) (a) An Expense Reserve Account shall be maintained under

the Fund, to which shall be credited :

(i) any amounts required to be credited in terms of

Rule 5(4);

(ii) investment earnings transferred from the Investment Reserve Account from time to time, as determined by the BOARD, acting on the advice of the ACTUARY.

(b) The Expense Reserve Account shall be debited with :

(i) the Fund’s expenses;

(ii) negative adjustments to investment earnings, transferred to the Investment Reserve Account as determined by the BOARD after consultation with the ACTUARY.

(c) As at the end of each FINANCIAL YEAR, the Expense Reserve Account shall be reviewed and if the amount standing to the credit of the Expense Reserve Account exceeds the amount required as decided by the BOARD acting on the advice of the ACTUARY, the excess shall be applied to increase the EMPLOYER’S PORTION and the MEMBER’S PORTION of MEMBERS on such equitable basis as decided by the BOARD in consultation with the ACTUARY.

(d) The Expense Reserve Account shall not be allocated proportionately on the exit of any MEMBER or group of MEMBERS, but may become payable to MEMBERS from time to time, at the discretion of the BOARD, in consultation with the ACTUARY.

Investment Reserve

Account

(11) (a) An Investment Reserve Account shall be maintained under the Fund, to which shall be credited :

(i) an opening balance as determined by the BOARD on the recommendation of the ACTUARY as at the SURPLUS APPORTIONMENT DATE;

(ii) all investment earnings of the Fund;

(iii) amounts debited to the EMPLOYER’S PORTION and the MEMBER’S PORTION of MEMBERS, and to the Data Reserve Account and Expense Reserve Account as a result of negative investment declarations;

(iv) any amounts required to be credited in terms of

Rule 5(6).

(b) The Investment Reserve Account shall be debited with :

(i) investment declarations, as determined by the BOARD on the recommendation of the ACTUARY, to the EMPLOYER’S PORTION and the MEMBER’S PORTION of MEMBERS, and to the Data Reserve Account, Risk Reserve Account and Expense Reserve Account;

(ii) all negative investment returns earned by the

Fund;

(iii) in accordance with the provisions of Section 15G of the ACT, amounts allocated in equitable proportion, as decided by the BOARD in consultation with the ACTUARY, to the benefit payable to or in respect of MEMBER on his retirement, retrenchment, death, leaving the MOTOR INDUSTRY in terms of Rule 6(9) or transfer from the Fund in any of the circumstances contemplated in these RULES.

RULE 6 – BENEFITS

NORMAL RETIREMENT

(1) Except as otherwise provided for in these RULES, every MEMBER shall retire on the attainment of NORMAL RETIREMENT AGE, on giving prior written notice to the BOARD, and shall be entitled to an annuity of such amount as can be purchased by his FUND CREDIT at the date of his retirement, provided that the MEMBER may elect to commute part or the whole of such benefit for a lump sum.

Early retirement

(2) A MEMBER may retire at any time after reaching age 55 and prior to his NORMAL RETIREMENT age, on giving prior written notice to the BOARD and his EMPLOYER. On his early retirement he shall be entitled to an annuity of such amount as can be purchased by his fund credit at the date of his retirement, provided that the MEMBER may elect to commute part or the whole of such benefit for a lump sum.

Late Retirement

(3) Subject to the consent of his EMPLOYER, a MEMBER who has reached his normal retirement age may remain in service after that date and may then retire on such date, not later than the date on which he reaches age 70, as he agrees with his EMPLOYER. On his late retirement he shall be entitled to an annuity of such amount as can be purchased by his FUND CREDIT at the date of his retirement, provided that the MEMBER may elect to commute part or the whole of such benefit for a lump sum.

Ill health

(4) If a MEMBER, in the opinion of the BOARD, through accident or ill health has become continuously and permanently unable to perform his usual work in the MOTOR INDUSTRY, such a MEMBER may elect to retire at any time prior to NORMAL RETIREMENT AGE, provided that a MEMBER’S disability shall not be permanent or continuous if it can be substantially removed by surgery or any other medical treatment which the MEMBER, with due allowance for the risk and prognosis of success of such treatment, can reasonably be expected to undergo.

On his retirement he shall be entitled to an annuity of such amount as can be purchased by a cash lump sum calculated as :

(a) three times his last determined annual REMUNERATION, subject to the provisions of Rule 4 (2);

plus

(b) his MEMBER'S PORTION at the date of his ill health retirement;

provided that in respect of a MEMBER who elected in terms of an option afforded to him in the Auto Workers’ Pension Fund as at 31 March 2005 to receive accrued benefits in respect of service to that date from the Auto Workers’ Pension Fund the cash lump sum benefit payable shall be equal to his FUND CREDIT, provided that the BOARD may, in its discretion, taking into account the benefit payable in respect of the MEMBER from the Auto Workers’ Pension Fund, pay a higher cash lump sum benefit;

provided further that the BOARD may, in its discretion, on specific application by a MEMBER at 31 March 2005, allow for a different level of cash lump sum payable in respect of a MEMBER, subject to any required adjustment to the allocation of EMPLOYER’s contributions for that MEMBER in terms of clause (4) of Rule 5.

Purchase of annuity

(5) An annuity which becomes payable in terms of sub‑Rules (1), (2), (3) or (4) shall be purchased on such terms and conditions as the BOARD may direct, from an insurer registered in terms of the Insurance Act, 1943.

Retrenchment

(6) If the BOARD on written proof is satisfied that a MEMBER has been retrenched due to the re‑organisation of staff or the abolition of his office or post for reasons beyond his control, or to retrenchment in general, then the MEMBER shall receive a lump sum benefit equal to his FUND CREDIT.

Death benefit

(7) In the event of the death of a MEMBER before retirement or withdrawal from the MOTOR INDUSTRY in terms of the provisions of sub‑Rules 1, 2, 3, 4, 6 or 9, there shall be payable a lump sum benefit equal to:

(a) three times his last determined annual REMUNERATION;

Plus

(a) his MEMBER’S PORTION at the date of his death;

provided that in respect of a MEMBER who elected in terms of an option afforded to him in the Auto Workers’ Pension Fund as at 31 March 2005 to receive accrued benefits in respect of service to that date from the Auto Workers’ Pension Fund the lump sum benefit payable shall be equal to his FUND CREDIT, provided that the BOARD may, in its discretion, taking into account the benefit payable in respect of the MEMBER from the Auto Workers’ Pension Fund, pay a higher lump sum benefit;

provided further that the BOARD may, in its discretion, on specific application by a MEMBER at 31 March 2005, allow for a different level of lump sum payable in respect of a MEMBER, subject to any required adjustment to the allocation of EMPLOYER’s contributions for that MEMBER in terms of clause (4) of Rule 5.

Payment of death

benefit

(8) Payment of the benefit referred to in sub‑Rule 7 shall be made in terms of Section 37C of the ACT.

Leaving MOTOR

INDUSTRY

(9) In the event of a MEMBER leaving the MOTOR INDUSTRY for reasons other than those referred to in sub‑Rule 6 and 7, and thereby ceasing to be a MEMBER, he shall receive a lump sum equal to his FUND CREDIT.

Unclaimed Benefits

(10) Any benefits due in terms of these Rules and unclaimed after the expiry of a period of three years from the date on which it first became due shall be placed in an unclaimed benefit account pending a valid claim by the claimants.

Transfer to another fund

(11) (a) If a MEMBER leaves the service of an EMPLOYER in circumstances which entitle him to a benefit in terms of Rule 6(6) or Rule 6(9) then he may, at his option, transfer all or, subject to the proviso to this Rule, part of such benefit to another APPROVED PROVIDENT FUND, PRESERVATION PROVIDENT FUND, APPROVED PENSION FUND or APPROVED RETIREMENT ANNUITY FUND; provided that transfer to a PRESERVATION PROVIDENT FUND is subject to the requirements of the REVENUE AUTHORITIES as specified from time to time.

(b) If a MEMBER, while remaining in the service of the EMPLOYER, ceases to qualify for membership of the Fund in terms of the conditions of the AGREEMENT, the BOARD shall transfer his FUND CREDIT to another APPROVED PROVIDENT FUND or APPROVED PENSION FUND operated by his EMPLOYER.

Benefits retained in the Fund

(12) The BOARD may allow a MEMBER to whom Rule 6(6) or Rule 6(9) applies to retain the benefit payable in terms of Rule 6(6) or Rule 6(9), as applicable, in the Fund. In such case, the MEMBER shall become a DEFERRED BENEFICIARY and the following provisions shall apply :

(a) the benefit retained in terms of this Rule shall be increased or decreased, while so retained, at such rate that the BOARD in their reasonable discretion, after consulting the ACTUARY, shall from time to time determine, at least annually, effective each FINANCIAL YEAR, having regard to the investment earnings on the Fund’s assets;

(b) no further contributions shall be payable by or on behalf of the DEFERRED BENEFICIARY on or after the date of his termination of service;

(c) the DEFERRED BENEFICIARY shall become entitled to the benefit referred to in (a) above, on his retirement in accordance with the provisions of Rule 6(1) or Rule 6(2), or it shall become payable to his beneficiaries in terms of Section 37C of the ACT if he dies before retiring;

(d) the DEFERRED BENEFICIARY shall not be entitled to benefits other than those provided in terms of this Rule 6(12); and

(e) if the DEFERRED BENEFICIARY returns to the service of an EMPLOYER :

(i) he shall cease to be regarded as a DEFERRED BENEFICIARY;

(ii) the benefit referred to in (a) above shall be reinstated under his FUND CREDIT; and

(iii) the RULES of the Fund shall, mutatis mutandis, apply to him with effect from that date.

RULE 7 – GENERAL

Guarantees for loans

Rights of termination

of service -no claim

for damages

(1) The BOARD shall have the power to furnish a guarantee in respect of a loan to a MEMBER by a Financial Institution approved by the BOARD for a purpose referred to in Section 19(5)(a) of the ACT and, if so required for such purpose, may make a deposit in pledge with such Institution as collateral security. Such guarantee shall be subject to the requirements of the REGISTRAR and shall further be subject to such conditions as may be determined by the BOARD from time to time in respect of a minimum loan amount and a maximum level of collateral as a percentage of the cash benefit payable if the MEMBER were to leave the Fund.

(2) Nothing in these RULES shall prejudice the right of an EMPLOYER to dispense with the service of, or to dismiss, any employee; nor the right of any employee to leave the services of his EMPLOYER on complying with the conditions of his employment. Any benefits contingent or absolute to which a MEMBER may claim to be entitled under these RULES shall not on his dismissal be a ground for any claims for damages or any increase in a claim for damages in any action brought against the Fund or the BOARD or his EMPLOYER in respect of such a dismissal.

Claim ‑ only in

terms of RULES

(3) No person, whether a MEMBER or otherwise, shall have any claim, right or interest upon the Fund or any contributions thereto, nor any interest therein or any claim upon or against the BOARD, except under, and in accordance with, the provisions of these RULES.

Evidence of age

(4) Each MEMBER shall supply such evidence of age and other information as the BOARD may require from time to time. If at any time it is proved to the satisfaction of the BOARD that the age of a MEMBER has been incorrectly given, then the BOARD shall have the power to make such adjustments or alterations to benefits as, in its absolute discretion, it deems fit.

Interpretation of

RULES

(5) The decision of the BOARD as to the meaning of or interpretation to these RULES or of any particular Rule or part of a Rule shall, subject to the provisions of Section 30A of the Act, be final and binding on the EMPLOYERS, MEMBERS and every person claiming to be entitled to a benefit under these RULES.

Decisions with

regard to claim

(6) Any question which may arise with regard to a claim by any person under these RULES shall be decided by the BOARD.

Question of fact

(7) In deciding on any question of fact, the BOARD shall act upon such evidence as it deems adequate, whether such evidence amounts to legal proof or not.

Evidence

(8) In arriving at a decision, the BOARD may receive representations orally or in writing in such manner and on such terms as it may determine, in its absolute discretion.

Amendment to

RULES

(9) (a) Subject to the prior approval of the COUNCIL, the BOARD may:‑

-shall not be to disadvantage of MEMBERS

(i) make such new RULES and regulations or alter or repeal any existing Rule as it may deem fit; provided that any such new RULES, alterations or repeals shall not be to the general disadvantage of MEMBERS;

-where the Fund is no longer capable of meeting benefits

(ii) notwithstanding the provisions of the preceding sub‑clause, if, as a result of any valuation by the ACTUARY in terms of Rule 3.12(b), the BOARD considers that the Fund is no longer capable of meeting the benefits provided for in these RULES, it may make such new RULES or regulations or alter or repeal any existing rule which it may deem necessary in the circumstances.

Amendment affecting Fund’s financial condition

(b) Any proposed amendment to these RULES affecting the financial conditions of the Fund shall first be submitted to and reported upon by the ACTUARY.

Submission to REGISTRAR and other Authorities

(c) All alterations to the RULES shall be submitted to the REGISTRAR, the REVENUE AUTHORITIES and any other statutory authority who so requires.

Amendment - not permitted if affecting main purpose of Fund

(d) No amendments whatsoever may be made to these RULES which have the effect of altering the main purpose of the Fund, namely the provision of benefits for MEMBERS at retirement.

Effective date

(e) If the registration of any amendment to the RULES in terms of the ACT is effected on a date later than the effective date of the amendment, the amendment shall nevertheless take effect from the effective date as stated in the amendment.

BOARD - incorporation and registration of Fund in conformity with requirements of Act and REVENUE AUTHORITIES

(10) The BOARD shall be empowered to do such acts and to execute

such documents as may be necessary to incorporate and register the Fund in terms of the ACT and to have the Fund approved by the REVENUE AUTHORITIES in terms of the Income Tax Act, 1962. If the REVENUE AUTHORITIES at any time refuse to approve the Fund, or part thereof, for the purpose of enabling the EMPLOYERS or the MEMBERS to obtain the benefit of exemption or allowance in respect of income or other tax, or if the BOARD considers it expedient, having regard to any ruling of the REVENUE AUTHORITIES with regard to income or other tax, the BOARD may, subject to the prior approval of the COUNCIL, make such alterations to the RULES as may be necessary to enable such approval to be obtained or to confirm with such a ruling.

Expiry of AGREEMENT - reasons for, and necessary actions by BOARD

(11) (a) In the event of the expiry of the AGREEMENT by effluxion of time or for any other cause, the BOARD shall continue to administer the Fund and may make such arrangements or enter into such AGREEMENTS as may be necessary for continuing the Fund under modified conditions, or dispose of the assets for the benefit of its MEMBERS in accordance with the advice of the ACTUARY; provided that in no case shall any assets, or any part thereof, be refunded to the EMPLOYERS.

Winding up - appointment of liquidator

(b) In the event of the discontinuance of contributions to the Fund, the BOARD shall appoint a liquidator, whose Appointment shall be subject to the approval of the REGISTRAR.

Winding up - liquidator’s obligations

(c) The liquidator shall realise the assets of the Fund and shall apportion the proceeds amongst the MEMBERS on a basis recommended by the ACTUARY and approved by the liquidator. In making such apportionment the liquidator shall include each former MEMBER whose membership ceased during the period of twelve months ending on the date of commencement of liquidation but shall reduce the amount of such person's apportionment by the amount of his benefit on cessation of membership. The liquidation shall then pay each beneficiary the amount of his benefit in cash.

BOARD - actions to be for benefit and protection of MEMBERS only

(12) The BOARD may, in its absolute discretion, make arrangements and do anything not inconsistent with these RULES or any amendment to them, which, in its opinion, is for the benefit and protection of MEMBERS and/or other beneficiaries.

Unexpected contingency

(13) In the event of a contingency arising which has not been provided for in these RULES, the decision of the BOARD thereon, if not inconsistent with the provisions of these RULES, shall be final and conclusive.