Nashua Corp., Nashua, N.H., pension plans, a $128 million composite pension trust and a $64 million employee savings plan, have agreed to purchase for $74.6 million a non-participating group annuity contract from Principal Life Insurance. The purchase will settle Nashuas pension obligation to retirees who were receiving pension benefits as of Dec. 1, 1999. Principal assumed the obligation to fund retiree payments beginning Jan. 1. Upon completion of the transaction, expected in the first quarter, Nashua will record a one-time, pre-tax gain of approximately $8 million. Gerald G. Garbacz, Nashuas chairman, president and CEO, said, "The move to an annuity-based system allows Nashua to significantly reduce its exposure relative to changes in equity and bond markets which impact the assets held by the companys pension plans. The change will allow the company to focus its near-term investment strategy on increasing portfolio value for future retirees, as opposed to its previous split focus on income generation for current retirees and appreciation for future retirees.