AmazonScience/document-haystack

1Pension Benefits2The UPS Retirement Plan is non-contributory and includes substantially all eligible employees of participating 3domestic subsidiaries who are not members of a collective bargaining unit, as well as certain employees covered 4by a collective bargaining agreement. The UPS Retirement Plan was closed to new entrants as of July 1, 2016.5UPS also sponsors a non-qualified defined benefit plan, the UPS Excess Coordinating Benefit Plan, for non-union 6employees whose pay and benefits in the qualified plan are limited by the Internal Revenue Service. An 7employee must be at least age 55 with 10 years of service to be eligible to participate in this plan. In the year 8that an individual first becomes eligible to participate in the UPS Excess Coordinating Benefit Plan, there is an 9increase for the participant for that year equal to the full present value of the participant’s accrued benefit in the 10plan. In accordance with the terms of the Excess Coordinating Benefit Plan, following a participant’s retirement, 11the Company pays an amount equal to the Social Security and Medicare taxes due on the present value of the 12benefits provided under the plan.13The UPS Retirement Plan and UPS Excess Coordinating Benefit Plan provide monthly lifetime benefits to 14participants and their eligible beneficiaries based on final average compensation at retirement, years of service 15with UPS and age at retirement. Participants may choose to receive a reduced benefit payable in the form of an 16annuity that is equivalent to the single lifetime benefit.17The plans provide monthly benefits based on the results from up to four benefit formulas. Participants receive 18the largest benefit from among the applicable benefit formulas. For Kate Gutmann the formula that results in the 19largest benefit is called the “grandfathered integrated formula.” This formula provides retirement income equal 20to 58.33% of final average compensation, offset by a portion of the Social Security benefit. A participant with 21less than 35 years of benefit service receives a proportionately lesser amount.22Participants earn benefit service for the time they work as an eligible UPS employee. For purposes of the 23formulas, compensation includes salary and an eligible portion of the MIP award. The average final compensation 24for each participant in the plans is the average covered compensation of the participant during the five highest 25consecutive years out of the last ten full calendar years of service.26Benefits payable under the UPS Retirement Plan are subject to the maximum compensation limits and the 27annual benefit limits for a tax-qualified defined benefit plan as prescribed and adjusted from time to time by the 28Internal Revenue Service. Eligible amounts exceeding these limits will be paid from the UPS Excess Coordinating 29Benefit Plan. Under this plan, participants receive the benefit in the form of a life annuity.30The plans permit participants with 25 or more years of benefit service to retire as early as age 55 with only a 31limited reduction in the amount of their monthly benefits. NEOs eligible to retire at age 60 receive unreduced 32benefits from the plans. In addition, the plans allow participants with ten years or more of service to retire at 33age 55 with a larger reduction in the amount of their benefit. These plans froze accruals after 34December 31, 2022. 355036 37Notice of Annual Meeting of Shareowners and 2024 Proxy Statement