EXHIBIT 10.38
THE XXXXX FUNDED EXECUTIVE PENSION SCHEME NO. 4
THIS DEED is made on 26 March, 1996 BETWEEN:
(1) XXXXX TRADING LIMITED whose registered office is at Xxxxxxx Xxxxx, Xxx
Xxxx, Xxxxxxxx, X00 0XX (the "Employer"); and
(2) XXXXX SUPPLEMENTARY PENSIONS LIMITED whose registered office is also at
Bruebon House as above (the "First Trustee").
WHEREAS:
(A) The Employer wishes to make provision for retirement benefits for Xxxxxxx
Xxxx and for that purpose to establish the Xxxxx Funded Executive Pension
Scheme No. 4 (the "Scheme") which will provide relevant benefits at
defined in section 612 of the Income and Corporation Taxes Xxx 0000.
(B) The provisions set out in this deed are to constitute the provisions of
the Scheme which will be a sponsored scheme (as defined in section 624 of
the Income and Corporation Taxes Act 1988).
(C) The assets of the Scheme are to be vested in the Trustees in accordance
with the provisions of this deed.
(D) The Employer has requested the First Trustee to act as the sole trustee of
the Scheme and the First Trustee has consented to so act.
NOW THIS WITNESSES as follows:
1. INTERPRETATION
(1) In this deed the following words have the meanings shown opposite them:
Dependent: any natural person who immediately before the Member's
death was wholly or partly maintained or financially
assisted by the Member (as to which the decision of
the Trustees is final).
Employment: the employment of the Member by the Employer. Any
reference to the period of Employment starts with the
date on which the Member's employment by the Employer
began or any other date notified to the Member by the
Employer in writing as being the start of his
Employment for the purposes of the Scheme.
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Fund: the assets held from time to time by the Trustees on
the trusts of the Scheme or, when the Fund is
distributed, the realisation value of the assets (less
the expenses of realisation).
Independent a Fellow of the Institute or Faculty of Actuaries
Actuary: chosen by agreement between the Employer and the
Member from time to time (or, in default of agreement,
chosen by the President of the Institute of Actuaries)
and appointed by the Employer from time to time to be
the Independent Actuary for the purposes of the
Scheme.
Xxxxx Pension the Xxxxx Pension Scheme governed by a deed dated
Scheme: 30th March, 1993.
Member: Xxxxxxx Xxxx (National Insurance No. XX000000X).
Normal Pension the date on which the Member reaches age 62 years and
Age: 6 months.
Scheme: the Xxxxx Funded Executive Pension Scheme No. 4
established by this deed.
Statement of the written statement dated 1st April, 1996 issued by
Benefits: the Employer to the Member describing the Scheme, a
copy of which is appended to this deed, as amended
from time to time.
Trustees: the First Trustee or any other trustee or trustees of
the Scheme from time to time.
Trust Deed: this deed as amended from time to time pursuant to
clause 21.
Vesting Day: the date which is two years before the date on which
the perpetuity period specified in clause 20(1)
expires.
(2) A reference in the Trust Deed to an Act includes any regulations made
under that Act and a reference to any legislation includes any
modification or re-enactment of it for the time being in force.
(3) The headings do not affect the meaning of the Trust Deed.
2. CONTRIBUTIONS
The Employer may pay contributions to the Scheme from time to time until:
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(a) the Employment terminates (unless, and for so long as, the Member is
absent from work before Normal Pension Age for a reason approved by
the Employer for the purpose of this sub-clause);
(b) the Employer notifies the Trustees that no further contributions will
be paid to the Scheme;
(c) the Scheme terminates; or
(d) the Member reaches Normal Pension Age.
3. TRUSTS
The Employer appoints the First Trustee to be the first trustee of the
Scheme. The Trustees hold the Fund on irrevocable trust to apply it in
accordance with the Trust Deed. Income of the Fund shall be added to
the Fund and applied as part of the Fund in accordance with the Trust
Deed.
4. BENEFIT ON TERMINATION OF EMPLOYMENT
(1) If the Employment terminates at or after Normal Pension Age (other than
through the Member's death), or where sub-clause (3) applies, the Trustees
shall apply the Fund to provide a pension payable to the Member or one or
more of his spouse or Dependants. The Member may instead elect to exchange
the pension for a cash sum payable to him; the amount of the cash sum
shall be decided by the Trustees. The conditions which apply to benefits
taken shall be agreed between the Member and the Trustees in writing
before the date on which the Fund is applied.
(2) Subject to sub-clause (3), if the Employment terminates (other than
through the Member's death) before Normal Pension Age, the Trustees shall,
if and when the Member reaches Normal Pension Age, apply the Fund to
provide a pension payable to the Member or one or more of his spouse or
Dependants. The Member may instead elect to exchange the pension for a
cash sum payable to him; the amount of the cash sum shall be decided by
the Trustees. However, the Member may, when he is aged 50 or older,
instead elect to be entitled to receive a pension payable to him or one or
more of his spouse or Dependants immediately, or elect to exchange the
pension for an immediate cash sum payable to him; the amount of the cash
sum shall be decided by the Trustees.
(3) This sub-clause applies if the Employment terminates before Normal Pension
Age due to Incapacity and the trustees of the Xxxxx Pension Scheme decide
to pay an immediate unreduced pension to the Member on account of the
Incapacity.
(4) If the Member ceases to be in pensionable service as defined in section 70
of the Xxxxxxx Xxxxxxx Xxx 0000 in circumstances where under that Act he
must be provided with short service benefit under the Scheme or a
permitted alternative, that short service benefit must be calculated in
accordance with that Act and provided by the Trustees.
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5. DEATH BENEFITS
(1) In this clause:
"the Death Benefit" means the amount payable on the Member's death as
set out in the Statement of Benefits;
"Beneficiaries" means any one or more of the following persons living
at the Member's death: the Member's spouse and grandparents, the
descendants of the Member's grandparents and the spouses of any of
them, any Dependant and any person, association or charity specified by
the Member in accordance with subclause (2)(c) below (but not the
Member or his legal personal representatives (in that capacity) or any
corporate body in which the Member (or his legal personal
representatives in that capacity) has any financial interest). For the
purpose of this definition, a stepchild of any person is deemed to be
that person's child and a natural child of any person who has been
adopted by another person is not excluded from this definition by
reason of the Children Xxx 0000.
(2) The Death Benefit (including the income thereon) shall be held by the
Trustees on the following trusts:
(a) The Trustees shall have power to pay or apply the Death Benefit to
or for the benefit of such one or more of the Beneficiaries (to the
exclusion of the others) in such shares and in such manner as the
Trustees decide. The Trustees must decide how to exercise that power
within two years after the Member's death and before the Vesting Day
and must not infringe the rule against perpetuities. Without
limiting the foregoing, the Trustees may decide to use the Death
Benefit to provide annuities, or may pay or transfer the whole or
any part of the Fund to the trustees (wherever they may be resident)
of one or more separate settlements the trusts of which must vest
indefeasibly in some person on or before the Vesting Day, which may
include trusts for the accumulation of income, protective trusts,
discretionary trusts and powers and provisions of a dispositive or
administrative nature exercisable by the trustees of the settlement,
including a power for those trustees to charge remuneration and
whether or not any such settlement is governed by English law.
If after making such enquiries as are described in paragraph (d),
the Trustees establish before the Vesting Day that there are no
Beneficiaries or are unable to establish within the period of 23
months following the Member's death or before the Vesting Day
that there are any Beneficiaries (as to which the Trustees'
decision shall be final and binding), then on the second
anniversary of the Member's death (or, if earlier, on the Vesting
Day) the Trustees shall hold the Death Benefit on trust
absolutely for the legal personal representatives of the Member,
unless any person or body referred to in section 46(1)(vi) of the
Administration of Estates Act 1925 would thereby become entitled
to the Death Benefit in which case the Trustees shall hold the
Death Benefit on trust absolutely
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for such person, body, institution or purpose recognised by
English law as being exclusively charitable as the Trustees
decide.
(b) If this sub-clause applies the Trustees shall subject to the trusts,
powers (and all exercises thereof) and provisions in paragraph (a),
hold the Death Benefit on trust absolutely for such person, body or
institution or apply the Death Benefit for such purpose as is (in
any such case) recognised by English law as being exclusively
charitable as the Trustees decide and all the trusts of the Scheme
shall vest not later than the Vesting Day.
(c) The Member may notify the Trustees in writing of the person or
persons in whose favour he wishes them to exercise the powers given
by this sub-clause and may (but need not) give his reasons. A notice
may be withdrawn (whether or not another is submitted) at any time.
The Trustees may also (but need not) take into account any other
indication given by the Member as to how he wishes such powers to be
exercised. The Trustees' decision under paragraph (a) must be in
writing. Subject only to the Trustees' duty under paragraph (a) to
pay or apply all the Death Benefit unless no Beneficiary can be
traced, the discretion on the part of the Trustees under paragraph
(a) is absolute and in no way compromised by any notice from the
Member as mentioned above.
(d) For the purpose of making a decision under paragraph (a), the
Trustees shall make or authorise to be made any enquiries which they
consider appropriate to ascertain the identity and whereabouts of
any person who is or may be a Beneficiary or to obtain any other
relevant information in relation to any such person. After the
Trustees have details as to the identity and whereabouts of any one
Beneficiary they may, but have no duty to, make any further
enquiries and no exercise of the discretion in paragraph (a) is
invalid nor may the Trustees be held to have acted in breach of
trust by reason of the fact that no further enquiries were made.
6. THE EMPLOYER
Any company which succeeds to the business, or a substantial part of
the business, of the Employer in any way (including, without
limitation, reconstruction, amalgamation or purchase), or is or becomes
a holding company or a subsidiary of the Employer, or is or becomes a
subsidiary of a holding company of the Employer, or becomes the
Member's employer, may, if the then Employer and the Trustees agree,
assume the position of the Employer under this Trust Deed in succession
to it. Such an assumption must be effected by a deed executed by the
Employer (unless it has been wound up), the Trustees and the new
company in which the new company agrees with the Trustees and the
Employer to undertake and assume the liabilities, rights and position
of the Employer under this Trust Deed in succession to the Employer and
which may take effect from the date of that deed or from an earlier or
later date.
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7. DEDUCTION OF TAX
The Trustees will deduct from any payment under the Scheme any tax,
duty or other fiscal imposition in respect of that payment for which
they are liable. The Member is responsible for paying any tax to which
he is subject in respect of the payment of benefits under the Scheme
and which is not deducted under this clause.
8. NON-ASSIGNABILITY
(1) A beneficiary under the Scheme must not in any way assign or charge the
whole or any part of his interest under the Scheme or do anything as a
result of which a benefit would or might, but for this clause, be payable
wholly or in part to some other person.
(2) If a beneficiary under the Scheme does or attempts to do any of the things
mentioned in sub-clause (1) or allows any of them to be done or becomes
bankrupt, his benefits are forfeited.
(3) The Trustees may (but need not) apply all or part of the forfeited
benefits for or towards the benefit of the beneficiary concerned and/or
any one or more of his dependants in the proportions and manner they
decide.
9. INCAPACITATED BENEFICIARIES
If a beneficiary under the Scheme is a minor or appears to the Trustees
to be suffering from any mental or physical incapacity rendering him
unable to manage his affairs or to give a proper receipt for any
benefit payable to him, the Trustees have two choices.
(a) They may pay the whole or part of the benefit to the beneficiary (if
he is a minor but is aged 16 or over) or to any other person
selected by them for the benefit of the beneficiary or to any of his
dependants. The receipt of the person to whom the benefit is paid is
a complete discharge for the amount paid and the Trustees do not
have any further responsibility in relation to the payment.
(b) They may retain the whole or part of the benefit and at any later
date pay the amount retained to the beneficiary or to any other
person selected by them. Any amount still retained by the Trustees
on the death of the beneficiary is forfeited.
10. EVIDENCE AND DEBTS OWED
(1) A beneficiary must produce any evidence and information required by the
Trustees for the purposes of the Scheme.
(2) This sub-clause applies if a monetary obligation is due from the Member to
the Employer as a result of a fraudulent or dishonest act or omission on
the part of the Member. On the
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production of a certificate signed by any two directors or one
director and the secretary of the Employer the Trustees must pay to
the Employer out of the Fund the amount of the monetary obligation.
The Member must be given a certificate showing the amount to be paid
to the Employer and no payment must be made to the Employer under this
sub-clause until three months after the Member has been given this
certificate. In the event of a dispute as to the operation of this
sub-clause or as to the amount to be paid to the Employer, the
Trustees must not make a payment until the monetary obligation has
become enforceable under a court order or the award of an arbitrator.
11. COSTS
The Trustees will pay all the costs and expenses of establishing,
administering and managing the Scheme out of the Fund (subject to any
such costs and expenses which the Employer may agree to pay on their
behalf).
12. TRUSTEES' POWERS - INVESTMENT
(1) In addition to all powers which the law gives to trustees, the Trustees
may exercise any of the following powers either through the agency of
another person or directly:
(a) power to allow cash to remain uninvested and to retain any other
assets, in each case for as long as they think fit;
(b) power to sell, exchange, lend or in any way deal with any assets on
any terms; and
(c) power, without any obligation to secure diversification of
investments or to take advice and either alone or in conjunction
with others:
(i) to acquire (whether immediately or in the future) assets of
any nature, situated in any part of the world whether tangible
or intangible, movable or immovable, and whether or not
producing income or involving liabilities or transferable by
delivery or by other means;
(ii) to affect and maintain any contract or policy with any
insurance company or office to which Part II of the Insurance
Companies Xxx 0000 applies and which is authorised by or under
section 3 or 4 of that Act to carry on ordinary long-term
insurance business as defined in that Act;
(iii) to place or retain any moneys on deposit or current account in
any currency with any bank, deposit-taking institution or
public authority or other company in any part of the world for
any period;
(iv) to make secured or unsecured loans to any person on any terms.
(2) The Trustees may enter into any kind of contract, including, but not
limited to:
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(a) underwriting or sub-underwriting the issue or purchase of
securities;
(b) lending securities;
(c) granting, purchasing, disposing of or dealing in options over or by
reference to any kind of asset; and
(d) acquiring, disposing of or dealing in warrants, futures contract or
currencies.
(3) Notwithstanding the provisions of this clause or clause 13, no part of the
Fund shall be invested in employer-related investments as defined in
section 112 of the Xxxxxxx Xxxxxxx Xxx 0000.
(4) After the Employer's liability to pay contributions to the Scheme has
ended (as mentioned in clause 2) the Member is required to direct the
Trustees as to how the Fund is to be invested. Those directions must be
given in writing in such form and time as the Trustees shall from time to
time notify to the Member. The Trustees must comply with any such
directions which are within the Trustees' powers under this deed and, in
so complying, the Trustees shall have no liability whatsoever to the
Member or any other beneficiary under the Scheme in relation to the
application or value of the Fund. Nor shall the Trustees have any duty to
advise the Member on or to keep under review any investment or to consider
whether or not it should be realised or switched.
13. TRUSTEES' POWERS - GENERAL
In addition to all powers which the law gives to trustees, the Trustees
may take any action or make any arrangements generally in connection
with the administration or management of the Scheme which they think
fit. In particular, but without limitation, they may exercise any of
the following powers:
(1) Power, in relation to any land or buildings:
(a) to apply money in improving or developing the land or buildings or
in erecting, altering, demolishing or maintaining any buildings on
the land; and
(b) to deal with and manage the land and buildings in any way and on any
terms (including, but without limitation, to lease or charge them);
(2) power to insure any asset against any risks and for any amounts;
(3) power to give guarantees or indemnities binding on the Fund, including by
giving security;
(4) power either to accept or to renounce any gifts or bequests, which may be
applied for the general purposes of the Scheme or for any special
purposes;
(5) power to borrow money on any terms and conditions (including as to
security);
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(6) power, with the consent of the Employer, to employ any person on any terms
and conditions;
(7) power, with the consent of the Employer, to obtain advice from, and engage
the services of any adviser, agent or manager on any terms;
(8) power to hold assets either in the name of the Trustees or any of them or
jointly with some other person or in the name of a nominee;
(9) power to delegate, either generally or for any particular purpose, to any
person any or all of the powers and discretions of the Trustees on any
terms and conditions approved by the Employer (including power to
sub-delegate with or without prior approval);
(10) power to authorise any person to open and operate bank accounts (including
the drawing and endorsing of cheques);
(11) power to appoint any person as custodian of any assets of the Scheme
(including records, papers and documents) on any terms and conditions
(including power to appoint sub-custodians and nominees with or without
prior approval); and
(12) power to insure the Trustees (including any employee and any director,
other officer or member of any committee appointed by the directors of a
corporate trustee) against any liabilities incurred in the discharge of
their duties under the Scheme and to insure the Fund against any losses
arising from the administration and management of the Scheme.
14. TRANSFERS
(1) The Trustees may with the consent of the Employer accept, and add to the
Fund, a transfer of any assets to the Scheme from any person and
including, without limitation, a transfer which relates to benefits
payable to and in respect of the Member under any retirement benefits
arrangement similar to the Scheme.
(2) If the Member becomes a member of any other retirement benefits
arrangement which is not approved under Chapter I, Par XIV, Income and
Corporation Taxes Xxx 0000, the Trustees shall have power to make a
transfer of the Fund to such other arrangement.
(3) The Employer may direct the Trustees to transfer the Fund to any other
retirement benefits arrangement on the basis that the Member will
thereupon become entitled to rights thereunder which are equivalent to his
rights under the Scheme.
(4) A transfer under this clause shall be subject always to the requirements
of the legislation applicable to the Scheme in relation to the Member. On
a transfer being made the Member shall cease to be a beneficiary of the
Scheme and no further benefits shall be payable to or in respect of him
under the Scheme.
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15. CONFLICTS OF INTEREST
(1) No decision of, or exercise of a power by, the Trustee or an employee,
officer, agent or delegate of the Trustees is invalidated on the ground
that the Trustees or any of the above mentioned persons had a direct or
other personal interest in the mode or result of such decision or of
exercising such power.
(2) An agent or delegate of the Trustees may be authorised in writing by the
Trustees to retain any benefit which has arisen for him in connection with
his dealings with the assets of the Scheme.
16. TRUSTEES' PROCEEDINGS
(1) The Trustees' duties and powers are exercisable either by resolutions of
the directors of the Trustees or, where appropriate, of any committee
(which may consist of or include non-directors) which the directors have
appointed either generally or for any particular purpose, or through any
duly authorised officer appointed for any general or particular purpose by
the directors. The directors of the Trustees may act by majority vote and
so may the members of any committee.
(2) The exercise of every power or discretion and the making of every
determination or decision by the Trustees in relation to the Scheme is at
their absolute discretion.
17. PROTECTION OF TRUSTEES
(1) No Trustee shall be liable for any acts or omissions not due to his own
wilful neglect or default. It shall not be obligatory upon the Trustees to
see that any contributions or other moneys payable to them under the
Scheme are in fact paid.
(2) Without limiting the generality of sub-clause (1):
(a) the Trustees shall not be liable for any loss arising from the fact
that they have delegated any of their powers, duties and discretions
under the Trust Deed;
(b) the Trustees are entitled to all the indemnities which the law gives
to trustees;
(c) the Trustees shall not be liable for acting on any professional
advice they may obtain;
(d) the Trustees shall not be liable for any loss arising from following
the Member's request or instructions regarding the investment of any
part of the Fund.
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18. TRUSTEES' REMUNERATION
A Trustee may be appointed on such terms as to remuneration whether
payable out of the Fund or otherwise as may be agreed from time to time
between the Employer and the Trustees and any corporation, company,
firm or person to whom payment of remuneration is made under any such
agreement may retain that remuneration beneficially. In addition, any
firm of which a Trustee is a partner and any corporation in which he is
in any way interested is entitled to be paid all proper charges for
business transacted, time spent and acts done in connection with the
Scheme.
19. APPOINTMENT AND REMOVAL OF TRUSTEES
(1) The Employer may by deed:
(a) appoint new or additional Trustees (without any limit on their
number);
(b) remove a Trustee. A deed executed by the Employer and any Trustees
not being removed declaring that the Trustee named in it is removed
from office has the same effect as a deed executed by the Employer
and all the Trustees declaring that the Trustee being removed wishes
to be discharged and that the Employer and the other Trustees
consent to the discharge and to the vesting in the other Trustees
alone of the Fund.
(2) A Trustee who retires or is removed must promptly execute any deeds and
other documents required to vest the Fund in the Trustees.
(3) There may be a sole corporate Trustee which is not a trust corporation.
20. TERMINATION
(1) The perpetuity period for the purpose of the Scheme is the period of 80
years after the date of this deed.
(2) The Scheme must terminate if:
(a) the Employer gives written notice to the Member and the Trustees
that the Scheme will terminate; or
(b) the Employer has an order made against it, or passes an effective
resolution, for its winding up and no other company has succeeded
the Employer (by agreement with the Trustees) in its obligations
under the Scheme within six months after the order or resolution; or
(c) at the end of the perpetuity period referred to above.
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(3) On termination of the Scheme the Trustee must pay, or set aside a reserve
pending payment, out of the Fund all costs, expenses and liabilities in
the administration and management of the Scheme or in connection with its
termination and for which the Trustees have not been reimbursed by the
Employer. Subject hereto, if the Member has dies before the event giving
rise to the termination, the Trustees will comply with clause 5(2) before
the Vesting Day. If he has not so died, the Trustees must apply the
remainder of the Fund in accordance with clause 4, as if the Member had
elected to take an immediate cash sum (rather than a pension) if then over
age 50. If the Member is then below age 50 the Trustees will apply the
remainder of the Fund in the purchase of a contract of insurance which
will provide the benefits which would otherwise have been provided under
the Scheme to the extent practicable and allowing for the expenses of such
purchase, on the assumption that the Member would elect to take his
benefit in the form of a cash sum rather than a pension.
(4) If any assets remain they must be paid to such person body or institution
or applied for such purpose as is recognised by English law as being
exclusively charitable as decided by the Trustees.
21. ALTERATIONS
The Employer, with the Trustees' agreement, may from time to time alter
or replace the Trust Deed except that no alternation shall have the
effect of permitting any payment to be made to the Employer from the
Fund. An alteration or replacement must be made by deed executed by the
Employer and the Trustees. An alteration may have retrospective effect.
No alternation shall be made which in the Independent Actuary's opinion
would have the effect of reducing the overall value of the Member's
accrued rights (as defined in the Pensions Act 1995) under the Scheme.
22. GOVERNING LAW AND JURISDICTION
The Scheme is governed by, and the Trust Deed is to be construed
according to and take effect in accordance with, the laws of England.
The Employer and the Trustees agree that the courts of England are to
have jurisdiction to settle any dispute which may arise out of or in
connection with the Scheme and the Trust Deed and submit to the
jurisdiction of those courts.
23. EMPLOYMENT CONTRACT
Nothing contained in the Trust Deed in any way restricts the right of
the Employer to terminate the Employment.
IN WITNESS of which this deed has been duly executed and delivered on the date
appearing first above.
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THE COMMON SEAL of )
XXXXX TRADING LIMITED )
was affixed to this deed )
in the presence )
/s/ X X Xxxxx /s/ X X Xxxxxx
------------- -------------------------
director director/secretary
THE COMMON SEAL of )
XXXXX SUPPLEMENTARY )
PENSION LIMITED )
was affixed to this deed )
in the presence )
/s/ X X Xxxxx /s/ X X Xxxxxxx
------------- -------------------------
director director/secretary
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Annuity Factors for Mr S Xxxx
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RATE OF INTEREST
DATE 2% 2 1/2% 3%
-------------------------------------------------------------------------------------------------------------------
31 July 1996 22.401 20.547 18.907
31 July 1997 22.874 21.084 19.495
31 July 1998 23.362 21.639 20.106
31 July 1999 23.280 21.625 20.151
31 July 2000 22.783 21.197 19.782
31 July 2001 22.281 20.763 19.405
31 July 2002 21.776 20.326 19.024
31 July 2003 21.269 19.884 18.639
31 July 2004 20.761 19.440 18.250
31 July 2005 20.252 18.994 17.857
31 July 2006 19.743 18.547 17.463
31 July 2007 19.236 18.099 17.066
31 July 2008 18.730 17.651 16.669
31 July 2009 18.226 17.203 16.271
31 July 2010 17.724 16.756 15.871
16 June 2011 (62 1/2) 17.263 16.344 15.521
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Note: The factors for the exact rate of interest would be calculated by linear interpolation.
