1E9Ct5D

1. The employer must enter into an agreement with an Austrian EmployeeBenefit Fund which are mainly institutions affiliated with banks and/orinsurance companies.2. For each employee, the employer must pay monthly instalments of 1.53per cent of the employees’ gross monthly salary (incl. 13th/14th salaries).The amounts are paid together with the regular social security paymentsand the social security authorities then transfer the respective amounts tothe Employee Benefit Fund.3. The employer must pay the contributions to the Fund from the start of theemployment (with the exception of the first month); no minimum durationof the employment relationship is required.4. Once the employment relationship comes to an end, the employee doesnot have a claim against the employer, but instead against the Funddirectly. Entitlement is not dependent on the way in which theemployment was terminated and therefore even employees who are terminatedfor cause retain their entitlement.5. After three years of employment, an employee can request that the Fundpays out the accumulated amounts in the event that the employer terminatesthe employment, the employment is terminated mutually or theemployee terminates the employment for good cause. In the event of theemployee’s death, his/her heirs can claim the amounts.6. Alternatively, the employee can choose to leave the accumulated amountsin the same Employee Benefit Fund for further investment, transfer theamounts to the Employee Benefit Fund of a new employer, transfer theamounts to an insurance company of their choice as a one-off paymentfor an insurance policy to be used as an additional pension, transfer theamounts to a pension fund at which the employee already has anentitlement or transfer the amounts to a financial institution of theirchoice for the purchase of shares in a pension investment fund understipulation of an irrevocable pay-out plan.7. From an Austrian taxation point of view, all contributions made to theEmployee Benefit Fund are expenses that can be written off on the part ofthe employer.8. Persons who were employed prior to 1 January 2003 may remain underthe old severance pay system (see above), or may at their discretionwholly or partly transfer to the new severance pay system. This requires awritten agreement between the employee and the employer.Dismissal Without NoticeIn general, the employee does not have a right to reinstatement. However, he doeshave the right to damages and the entitlements referred to in a).bRights of Employer on Termination by EmployeeThe improper termination of the employment contract by an employee, i.e. if withoutnotice there is no important reason or, if with notice the period of notice prescribed isnot complied with, terminates the employment relationship with immediate effect. Theemployer will generally only have a claim for damages. The decision on the quantum ofdamages must be assessed by the court and will be calculated on what is fair andreasonable in the circumstances.- 55 -