DRAFT ONE – 11 OCTOBER 2007
Private & Confidential
DATED 2007
THALES UK LIMITED(1)
and
[NAME OF TRUSTEES/TRUSTEE COMPANY](2)
DEFINITIVE DEED AND RULESrelating to the
Thales UK Pension Scheme
INITIAL DRAFT TRUST PROVISIONS AND POWERS ONLY DETAILS OF BENEFITS NOT INCLUDED
Birmingham London Brussels
Tel +44 (0)870 903 1000 Fax +44 (0)870 904 1099
THIS DEFINITIVE DEED AND RULES is made on 2007
BETWEEN:
(1)THALES UK LIMITED (No. 868273) whose registered office is at 2 Dashwood Lang Road, The Bourne Business Park, Addlestone, Weybridge, Surrey KT15 2NX; and
(2)[NAME OF TRUSTEES/TRUSTEE COMPANY] (No.[ ]) whose registered office is at [ ].
INTRODUCTION
(A)The Principal Employer wishes to establish an occupational pension scheme as defined in section 150(5) FA 2004.
(B)The Trustees have agreed to be the trustees of the Scheme.
(C)The Scheme is established to:
(i)provide pension and death benefits for and in respect of Employees of Employers in the Thales group of companies and are eligible to the join the Scheme under the terms of its Rules from time to time; and
(ii)receive the assets and liabilities of the Former Schemes which provide pension and death benefits for and in respect of Employees and former Employees (including dependants of such persons) of Employers who are or have been in the Thales group of companies (from time to time).
(D)The Scheme is established on and from []
LEGAL EFFECT OF THIS DEED:
The legal effect of this deed is as set out below.
1By this deed the Principal Employer establishes the Scheme with effect on and from [ ].
2The Scheme provides such pension and death benefits as the Principal Employer decides from time to time for and in respect of the Members.
3The Scheme is designed to be a Registered Pension Scheme under the terms of Part 4 of the Finance Act 2004 (as amended).
4The Scheme is designed to be a contracted-out pension scheme providing contracted-out benefits for and in respect of such Members as the Principal Employer decides from time to time. The Scheme complies with the Contracting-out Requirements.
5The Scheme is designed to comply with the Preservation Requirements.
6The Trustees hold the Fund on irrevocable trusts to apply it in accordance with the Rules of the Scheme.
7The Scheme is called the Thales UK Pension Scheme.
8Words and phrases defined in Rule 1 apply to this deed.
IN WITNESS of the above this deed has been executed by or on behalf of the parties and delivered on the date written on page 1
CONTENTS
Rule Number and HeadingPage
Definitions and Interpretation
1Definitions
2Interpretation and Overriding Provisions
Effective Date and Persons affected by these Rules
3Effective Date
4Persons affected
Modification, Augmentation and Use of Distributable Surplus
5Modification
6Augmentation
7Appointment and Removal of Trustees
8Expenses and Remuneration of Trustees
9Trustees Benefiting from the Scheme
10Trustee Indemnities and Insurance
11Administration and Management
12Trustees’ Meetings and Procedures
13Delegation
14Advisers
15Employment of Agents and Staff
16Investment
17Insurance of Benefits
18Bank and Building Society Accounts
19Borrowing
20Accounts and Audit
21Actuarial Investigations
22Insurance of Fund Assets
Discretionary Trust of Lump Sums
23Discretionary Trust of Lump Sums
Participation of Employers, Transfers and Winding-up
24Admission of Employers
25Withdrawal of Employer
26Transfers to the Scheme
27Transfers from the Scheme
28Closing the Scheme
29Substitution of Principal Employer
30Transfer of Powers
31Winding-up
General
32Notices
33Production of Evidence
34Assignment and Forfeiture
35Incapacity and Minority
36Information from Employers
37Unclaimed Money
38Taxation and Levies
Contributions
39Employers' Contributions
1
Legal01#9891221v4[GLH1]/[JPC]
THE RULES
The Thales UK Pension Scheme
Definitions and Interpretation
1Definitions
1.1In this deed, unless the context otherwise requires:
“1993 Act” means the Pension Schemes Act 1993.
“1995 Act” means the Pensions Act 1995.
“2004 Act” means the Pensions Act 2004.
“2006 Act” means the Companies Act 2006.
“Actuary” means a Fellow of the Institute or Faculty of Actuaries (or a firm making available the services of such a person) appointed under Rule 14.
“Adviser” means any person including, without limitation, an actuary, auditor, fund manager, legal adviser or surveyor.
“Beneficiary” means any person absolutely or contingently entitled to a benefit, whether immediate or prospective, from the Scheme.
“Cash Equivalent” has the same meaning as in section 94 of the 1993 Act (as reduced (if it is reduced) under regulations made under section 97(4) of the 1993 Act).
“Chargeable Right” means an entitlement to a pension under the Scheme or a right to a future pension under the Scheme.
“Closed Fund” means the status of the Scheme during any period, from the first of the dates specified in Rule 28.2 until either:
(a)the commencement of the winding-up period as described in section 73(10) of the 1995 Act; or
(b)termination of the status of the Scheme or a Closed Fund under Rule 28.3.
“Contracting-out Requirements” means the requirements to be met for the purpose of obtaining and maintaining a contracting-out certificate under Chapter I Part III of the 1993 Act by reference to the Scheme.
“Dependant” has the meaning in paragraph 15 of Schedule 28 to the FA 2004.
“Employee” means a person holding a contract of employment with an Employer (or where the context so requires, has held a contract of employment with an Employer in the past).
“Employer” means the Principal Employer and any other person admitted to participation under Rule 24.1. In relation to any Employee or former Employee or Beneficiary claiming through him, “Employer” refers to the Employer with which, at the relevant time, the Employee or former Employee holds or last held a contract of employment.
“FA 2004” means the Finance Act 2004.
“Former Employer” means an Employer which, under Rule 25 or Rule 28, has ceased to participate in the Scheme under Rule 24.
“Former Scheme” means any of:
(a) Racal Group Executive and Senior Manager Pension Scheme established with effect from 1 April 1973 and now governed by a deed dated 7 January 1980 and rules effective from 1 April 1986 (as amended);
(b)Racal Decca Pension and Life Assurance Scheme established with effect from 31 December 1947 and now governed by a deed dated 19 October 1948 and rules effective from 1 April 1986;
(c)Racal Group Staff Pension and Life Assurance Scheme established with effect from 23 February 1962 and now governed by a deed and rules dated 29 May 1987;
(d)Racal Group Executive Pension Plan established with effect from 1 August 1976 and now governed by a deed and rules dated 9 November 1983;
(e)Pilkington Optronics Limited Pension Scheme established with effect from 1 April 1961 and now governed by a deed and rules dated 31 May 2000;
(f)W Vinten Limited Pension Scheme established with effect from 5 April 1997 and now governed by a deed and rules dated 8 March 1999;
(g)Avimo Pension Scheme established with effect from 30 November 1960 and now governed by a deed and rules dated 19 June 1995;
(h)Thomson Pension Plan established with effect from 30 March 1999 and now governed by a deed and rules dated 25 July 2002; and
(i)Thomson Retirement Benefits Scheme established with effect from 28 December 1984 and now governed by a deed and rules dated 8 March 2002.
“Former Scheme Beneficiary” means any person absolutely or contingently entitled to a benefit whether immediate or prospective from a Former Scheme and whose benefits have been transferred to the Scheme under Rule 26.1 {transfers to the Scheme}.
“Fund” means the assets for the time being held by or on behalf of the Trustees on the trusts of the Scheme.
“Insolvency Event” means in relation to an Employer a circumstance in which, if the Employer were the employer in relation to the Scheme for the purpose of section 22(1) of the 1995 Act, that section would apply to the Scheme.
“Insurance Company” has the meaning in section 275(1) of the FA 2004.
“Member” means a member, as defined by section 151(1) of the FA 2004, of the Scheme and includes, but is not limited to, any Former Scheme Beneficiary in relation to whom a transfer payment is received by, or a liability is assumed by, the Scheme under Rule 27.1.
“Membership” means the status of being a Member.
“New Principal Employer” has the meaning in Rule 29.1.
“New Revenue Limits” means those provisions of Chapter 2 Part 4 FA 2004, Chapter 3 Part 4 FA 2004 and Chapter 4 Part 4 FA 2004 with which a Registered Pension Scheme must comply in order:
(a)to maintain its Registration;
(b)to prevent any charge to tax under section 239 FA 2004 {scheme sanction charge }arising; and
(c)not to make any Unauthorised Member Payment.
“Old Principal Employer” has the meaning in Rule 29.1.
“Other Scheme” means a Registered Pension Scheme, a qualifying recognised overseas pension scheme as described in section 169(2) of the FA 2004 or an Insurance Company where the proposed transfer is as described in section 169(1A) of the FA 2004.
“Partner” means the Member’s “spouse”, “widow”, “widower” or Civil Partner for the purposes of the application of benefits in respect of the death of a Member (unless the context of the Rules requires otherwise).
“person” includes without limitation, any corporation and any unincorporated body of persons.
“Policy” means any contract or policy with an Insurance Company which is an Other Scheme or which provides benefits on the death of a Beneficiary.
“Preservation Requirements” means the provisions of Part IV of the 1993 Act relating to the rights of a deferred member.
“Principal Employer” means Thales UK Limited or any person who becomes the Principal Employer under Rule 29.
“Recognised Transfer” has the meaning in section 169 of the FA 2004.
“Revenue” means Her Majesty’s Revenue and Customs.
“Registration” means registration under Chapter 2 Part 4 of the FA 2004.
“Registered Pension Scheme” has the meaning in section 150(2) of the FA 2004.
“Rule” refers to any of these Rules.
“Schedule of Contributions” has the meaning in section 227(2) of the 2004 Act.
“Scheme” means the Thales UK Pension Scheme established by this deed.
“Scheme Administrator” means the scheme administrator, as defined in section 270 of the FA 2004, of the Scheme.
“Scheme Chargeable Payment” has the meaning in section 241 of the FA 2004.
“Scheme Pension” has the meaning in paragraph 2 of Schedule 28 to the FA 2004 insofar as that paragraph applies to the Scheme.
“Sectionalised Scheme” means a scheme that has more than one employer and is divided into two or more formal sections whereby:
(a)contributions payable to the scheme by an employer, or by a member in employment under that employer, are allocated to that employer’s section (or, if more than one section applies to the employer, to the section which is appropriate in respect of the employment in question); and
(b)a specified part of proportion of the assets of the scheme is attributable to each section and cannot be used for the purposes of any other section.
“Substituted Benefit” means any benefit payable under the Scheme which the Trustees decide, having regard to Rule 17.7, is to be provided by a Policy instead of providing it out of the Fund.
“Transfer Benefits” means all or such part of the benefits of a Beneficiary or group of Beneficiaries under the Scheme as the Principal Employer determines for the purpose of making a transfer under Rule 27.1.
“Transfer Regulations” means the Occupational Pension Schemes (Transfer Values) Regulations 1996 (SI1996/1847) and the occupational Pension Schemes (Transfer Values and Miscellaneous Amendments Regulations 2003 (SI 2003/1727).
“Trustees” means [NAME OR TRUSTEES/ TRUSTEE COMPANY] (No. [ ]) or the trustee or trustees for the time being of the Scheme and includes, where the context requires, the directors for the time being of a corporate trustee.
“Unauthorised Member Payment” has the meaning in section 160 of the FA 2004.
2Interpretation and Overriding Provisions
2.1The Trustees and the Principal Employer will administer the Scheme in a manner which means that it:
(a)is a Registered Pension Scheme;
(b)provides such pension and death benefits for and in respect of Members as the Principal Employer decides and notifies to the Trustees in writing;
(c)provides contracted-out benefits for such Members as the Principal Employer decides in accordance with the Contracting-out Requirements;
(d)complies with the Preservation Requirements for Members.
2.2The Principal Employer will make such amendments to the Rules of the Scheme as are necessary from time to time to comply with Rule 2.1.
2.3The Principal Employer may decide that the Scheme will be operated as a Sectionalised Scheme with effect from such date as the Principal Employer decides. The Principal Employer will decide the manner in which the Scheme is to be sectionalised if it decides that the Scheme should be operated as a Sectionalised Scheme.
2.4The Principal Employer will notify the Trustees of any decision to operate the Scheme as a Sectionalised Scheme in writing and will provide the Trustees with all information necessary for them to be able to administer the Scheme as a Sectionalised Scheme.
2.5The Principal Employer will make such amendments to the Rules of the Scheme as are necessary from time to time to comply with Rules 2.3 and 2.4.
2.6Each of the Principal Employer, the Employers and the Trustees in making any decision or in giving or withholding agreement or consent or in exercising or not exercising any power in relation to the Scheme shall:
(a)comply with the Contracting-out Requirements;
(b)comply with the Preservation Requirements;
(c)comply with the requirements of FA 2004 to be a Registered Pension Scheme and the New Revenue Limits (which may require benefits and/or contributions to be reduced or restricted) unless the Rules require otherwise;
(d)limit the activities of the Scheme to retirement benefit activities as defined by section 255(4) of the 2004 Act.
2.7Unless the Rules require otherwise, the New Revenue Limits will apply to the Scheme to limit or restrict every payment of any kind from the Scheme to a payment which a Registered Pension Scheme is authorised to make under section 164 of the FA 2004 or section 175 of the FA 2004. Without limitation, subject to Rule 6.1(c), every pension payable under the Scheme must be restricted or limited to the extent necessary for it to satisfy all the conditions for it to be a Registered Pension Scheme.
2.8If at any time the New Revenue Limits are changed in a way which increases the amount or value of any benefit under the Scheme, when compared to its amount or value immediately before such a change after the application of Rule 2.7, then the New Revenue Limits will apply to the Scheme as described in Rule 2.7 as if the New Revenue Limits had not been so changed except insofar as the Principal Employer decides otherwise.
2.9Subject to the performance of their duties and Rule 2.6, the Trustees in making any decision or in giving or withholding their agreement or consent or in exercising or not exercising any power in relation to the Scheme shall do so at their absolute and uncontrolled discretion.
2.10The decision of the Trustees shall be final on:
(a)all questions which are left to their determination or decision in relation to the Scheme; and
(b)all matters relating to the management and administration of the Scheme on which this deed, and any other provisions of the Scheme are silent; and
(c)all questions and matters of doubt arising in connection with the Scheme.
2.11Words (except the word “sole”) importing the singular include the plural and vice versa. The plural form of words and expressions defined in Rule 1 shall be construed according to the meaning given to the singular form and vice versa.
2.12Words denoting one gender (except the words, “male” and “female”) or the neuter include the other gender and the neuter as the case may be.
2.13The table of contents, the headings to the provisions of this deed and words between the symbols { } are for reference purposes only and shall not affect the meaning or construction of this deed.
2.14References to this deed include the Rules.
2.15Any reference to a statute or a statutory instrument (or to a particular chapter, part of, section of, regulation of, or schedule to, a statute or statutory instrument) includes any modification or re-enactment of it and (in the case of a reference to a statute) any regulations, orders or other delegated legislation made under it.
2.16Nothing in this deed or other provisions of the Scheme shall:
(a)restrict the right of an Employer to terminate the employment of an Employee with the Employer; or
(b)be used in aggravation of damages or compensation in any proceedings brought by the Employee against any Employer in respect of the termination of his employment.
2.17Nothing in this deed shall in any way be construed as imposing upon an Employer a contractual obligation as between the Employer and an Employee to contribute or to continue to contribute to the Fund.
2.18No person shall have any claim, right or interest under the Scheme or any claim upon or against the Trustees or an Employer in respect of the Scheme except under or in accordance with this deed or any deeds or documents changing or replacing it.
2.19If the Trustees reduce or vary the benefits under the Scheme relating to a Member with his agreement, his agreement shall bind any other Beneficiary whose benefits under the Scheme relate to that Member.
2.20If it gives prior written notice of the delegation to the Trustees, the Principal Employer may delegate the exercise of any powers given to it under this deed to an Employer.
2.21The Trustees shall in relation to the Scheme comply with any improvement notice issued under section 13 of the 2004 Act and with any codes of practice published under section 90 of the 2004 Act whether or not the improvement notice or code of practice or any part of them is otherwise required or authorised by this deed.
Effective Date and Persons affected by these Rules
3Effective Date
3.1This deed has effect on and after [].
4Persons affected
4.1The provisions of this deed apply to the benefits of all Beneficiaries.
Modification, Augmentation and Use of Distributable Surplus
5Modification
5.1Subject to Rule 5.2, the Principal Employer may by deed change all or any of the provisions of this deed or other provisions of the Scheme including this Rule 5 in any way. Any change shall take effect from the date specified in the deed making the change, which date may be earlier or later than the date of that deed.
5.2The power set out in Rule 5.1 is subject to section 67 of the 1995 Act {restrictions on amendments}.
6Augmentation
6.1Subject to Rules 6.2 and 6.4, the Principal Employer may:
(a)augment or vary benefits payable under the Scheme either generally or in any particular case; or
(b)provide benefits out of the Scheme for any Employee or former Employee or any person who would be a Dependant of an Employee or a former Employee if the Employee or former Employee were or had been a Member; or
(c)subject also to Rules 6.5 and 6.6, authorise the Trustees to provide a benefit out of the Scheme which is an Unauthorised Member Payment.
6.2The Principal Employer having considered the advice of the Actuary, will decide the amount and timing of additional contributions (if any) required to be paid to the Scheme by the Employers in respect of any decision made under Rule 6.1, taking into account the cost of the additional benefits.