THREE PERCENT (3%) RULE Definition

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THREE PERCENT (3%) RULE is a rule used in vesting pension plan benefits. The participants accrued benefit must be at least equal to 3% of the participants normal projected retirement benefit for each year of participation, with a maximum of 100% after 33 1/3 years of participation.

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OTHER EXPENSES/(INCOME) includes: miscellaneous other income and expenses (net), such as interest expense, miscellaneous expenses not included in general and administrative expenses, netted against recoveries, interest income, dividends received and miscellaneous income.

PREREFUNDING is the the issuing of new securities to refund an outstanding security. Proceeds from the new securities are used to buy instruments, usually U.S. Treasuries, to be held in escrow for the purpose of retiring bonds or preferred stock.

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