Common use of Early Commencement Clause in Contracts

Early Commencement. If the annual benefit commences before the social security retirement age, the maximum permissible benefit may not exceed the lesser of the actuarial equivalent of a Ninety Thousand Dollar ($90,000) annual benefit beginning at the social security retirement age or the Participant's highest average compensation. If the annual benefit commences before the social security retirement age but after age sixty-two (62) years, this actuarial equivalent shall be the Ninety Thousand Dollar ($90,000) annual benefit reduced in accordance with reductions in social security benefits (i.e., 5/9% for each of the first 36 months and 5/12% for each additional month by which the commencement date precedes the social security retirement age). If the annual benefit commences before age sixty-two (62) years, this actuarial equivalent shall be the actuarial equivalent of the maximum permissible benefit as reduced under the prior sentence to age sixty-two (62) years. This actuarial equivalent (i.e., the pre-age 62 years actuarial equivalent) shall be the lesser of (A) the equivalent amount computed using the interest rate and mortality table (or tabular factor) specified in the defined benefit plan for determining the amount of the early retirement benefit that is payable under the plan, or (B) the equivalent amount computed using five percent (5%) interest and the applicable mortality table as prescribed by the Secretary of the Treasury for these purposes.