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NCR Corporation (NYSE: NCR) announced today that it is offering a voluntary lump sum payment option to certain former employees or beneficiaries currently receiving a monthly benefit from its U.S. pension plan. With this action, NCR expects to reduce pension liabilities for the company as well as reduce pension-related expenses.
“This offer is part of our pension transformation and is consistent with our overall de-risking strategy,” said John Boudreau, NCR Treasurer. “There is no additional funding of the plan required for this transaction as all distributions will be made out of existing plan assets. The plan's funded status is expected to remain materially unchanged as a result of this offer.”
This offer will create a settlement event in the fourth quarter of 2014 that is not expected to have a material impact on NCR’s financial results and will be a part of the annual mark-to-market adjustment.
This offer is completely voluntary, providing approximately 20,000 former employees or beneficiaries currently receiving monthly pension benefits with an opportunity to have greater flexibility and control in managing their retirement. The lump sum payment represents the present value of an individual’s current monthly pension plan benefit.
Overview of the voluntary lump sum offer
The offer is being made only to former employees or beneficiaries who commenced monthly benefits under the plan between January 1, 1994 and April 1, 2014. The details of the offer will be described in personalized information letters that these individuals will receive in the coming weeks. The offer includes the following choices:
One-time lump sum payment rolled over to an IRA or another qualified plan (if permitted by that plan)
One-time lump sum payment in cash, payable in November 2014
A new form of payment for their monthly benefit (joint & survivor annuity or single life annuity) if eligible
Take no action and continue to receive the same current monthly benefit in the same form as currently paid
Eligible participants have from July 2 until August 22, 2014 to accept the offer. Additional details are available by visiting the NCR website at
http://www.ncr.com/home/retiree-lump-sum-offer. Participants may also access account information through the
NCR Benefits Service Center website at
www.netbenefits.com or by telephone at 1-866-678-3233.
Certain participants are not eligible for this offer, including former employees or beneficiaries who commenced their monthly benefits under the plan before January 1, 1994 or after April 1, 2014.