UNITED TECHNOLOGIES CORPORATION (UK) PENSION SCHEME Statement of Investment Principles
The Trustee of the UTC (UK) Pension Scheme (“the Scheme”) is UTC Pension Trust Ltd and that company and the Directors of that company are referred to in this document as the Trustees. The Trustees have drawn up this Statement of Investment Principles (“the Statement”) to comply with the requirements of the Pensions Act 1995 (“the Act”) and subsequent legislation. The Statement is intended to affirm the investment principles that govern decisions about the Scheme’s investments. A separate document called the Statement of Investment Objectives (“SIO”) of the UTC Common Investment Fund (the CIF) details the specifics of the Scheme’s investment arrangements in the CIF. The Trustees of the Scheme agreed to accept the transfer (the Transfer) into the Scheme of the assets and liabilities of the Goodrich (UK) Pension Scheme (the Goodrich Scheme) on 1 June 2016. In conjunction with the Transfer, an asset-backed contribution (ABC) structure was implemented in respect of the Scheme. The ABC structure consists of two loan notes issued by United Technologies Corporation (UTC), held by two Scottish Limited Partnerships (SLPs) in which the Trustee is a limited partner. The loan notes provide for: • Coupon payments (interest) to be paid to the SLPs (and in turn passed onto the Scheme) in respect of each loan note of 4.10% per annum; and • A final payment to the SLPs (and in turn to the Scheme) at the end of the 20- year term of the two loan notes of £134 million and £186 million respectively. The ABC structure is governed by the Scheme’s Trustees and not the Administrator of the CIF. The ABC is held directly by the Scheme, outside of the CIF. The ABC structure is not tradable and therefore will form part of the Scheme’s assets until 30 May 2036. In preparing this Statement the Trustees have consulted with the Principal Employer of the Scheme, Ceesail Ltd (the “Company”) to ascertain whether there are any material issues of which the Trustees should be aware in agreeing the Scheme’s investment arrangements. The Trustees have also consulted the Company over the investment objectives and investment strategy and have taken into account the Company’s views. The final decisions, however, have been made by the Trustees having taken advice from the Scheme Actuary and the Trustees’ investment consultants. Sections 2 to 7 relate to the Scheme’s defined benefit sections and Sections 8 to 11 relate to the Scheme’s additional voluntary contribution (AVC) arrangements provided on a defined contribution (DC) basis. Sections 12 onwards relate to both sections.
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