NCR has purchased a single premium group annuity contract from The Principal to transfer about US$160 million ($185.8 million) of pension liabilities.
The contract affects about 4,500 former employees or their related beneficiaries who commenced monthly pension benefits under the plan before Jan. 1, 1994.
This group annuity contract does not affect active employees, former employees who have not commenced monthly benefits under the plan, or former employees or their beneficiaries who commenced monthly benefits under the plan on or after Jan. 1, 1994.
“This group annuity contract purchase is part of our pension transformation and is consistent with our overall strategy to address our legacy issues,” says John Boudreau, NCR’s treasurer. “Since this contract was purchased with existing plan assets, no additional funding of the plan was required for this purchase. The plan’s funded status is expected to remain materially unchanged as a result of this group annuity contract purchase.”
In March 2015, additional details will be provided in letters and other materials that will be sent to affected former employees or their beneficiaries who commenced monthly benefits under the plan before Jan. 1, 1994.
The amount of the future monthly benefit payment for each of these individuals under this group annuity contract will equal the amount of such individual’s monthly benefit payable under the terms of the plan.
Additionally, this group annuity contract provides the same rights to future payments, such as survivor benefits, that are currently provided under the terms of the plan.
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