[Federal Register Volume 60, Number 236 (Friday, December 8, 1995)]
[Notices]
[Pages 63062-63064]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-29985]
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DEPARTMENT OF LABOR
Pension and Welfare Benefits Administration
[Prohibited Transaction Exemption 95-108, Exemption Application No. D-
09973, et al.]
Grant of Individual Exemptions; Kay Alden, Inc. Money Purchase
Plan (the Plan), et al.
AGENCY: Pension and Welfare Benefits Administration, Labor.
ACTION: Grant of individual exemptions.
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SUMMARY: This document contains exemptions issued by the Department of
Labor (the Department) from certain of the prohibited transaction
restrictions of the Employee Retirement Income Security Act of 1974
(the Act) and/or the Internal Revenue Code of 1986 (the Code).
Notices were published in the Federal Register of the pendency
before the Department of proposals to grant such exemptions. The
notices set forth a summary of facts and representations contained in
each application for exemption and referred interested persons to the
respective applications for a complete statement of the facts and
representations. The applications have been available for public
inspection at the Department in Washington, D.C. The
[[Page 63063]]
notices also invited interested persons to submit comments on the
requested exemptions to the Department. In addition the notices stated
that any interested person might submit a written request that a public
hearing be held (where appropriate). The applicants have represented
that they have complied with the requirements of the notification to
interested persons. No public comments and no requests for a hearing,
unless otherwise stated, were received by the Department.
The notices of proposed exemption were issued and the exemptions
are being granted solely by the Department because, effective December
31, 1978, section 102 of Reorganization Plan No. 4 of 1978 (43 FR
47713, October 17, 1978) transferred the authority of the Secretary of
the Treasury to issue exemptions of the type proposed to the Secretary
of Labor.
Statutory Findings
In accordance with section 408(a) of the Act and/or section
4975(c)(2) of the Code and the procedures set forth in 29 CFR Part
2570, Subpart B (55 FR 32836, 32847, August 10, 1990) and based upon
the entire record, the Department makes the following findings:
(a) The exemptions are administratively feasible;
(b) They are in the interests of the plans and their participants
and beneficiaries; and
(c) They are protective of the rights of the participants and
beneficiaries of the plans.
Kay Alden, Inc. Money Purchase Plan (the Plan), Located in Chicago,
Illinois; Exemption
[Prohibited Transaction Exemption 95-108; Exemption Application No.
D-09973]
The restrictions of sections 406(a), 406(b)(1) and 406(b)(2) of the
Act and the sanctions resulting from the application of section 4975 of
the Code, by reason of section 4975(c)(1) (A) through (E) of the Code
shall not apply to the purchase of real property (the Purchase) by the
Plan from Mr. Vernon Nelson (Nelson), a party in interest with respect
to the Plan provided that: (a) The Purchase is a one time transaction
for cash; (b) the Plan will pay no more than fair market value for the
Property, as determined by an independent qualified real estate
appraiser at the time of the transaction; (c) the fair market value of
the Property represents no more than 25% of the value of the Plan's
assets; (d) the Plan's interests with respect to the Purchase are
represented by two independent fiduciaries; (e) the Plan will pay no
fees or commissions associated with the Purchase; and (f) all terms and
conditions of the Purchase are at least as favorable to the Plan as
those obtainable in an arm's length transaction with an unrelated
party.
For a more complete statement of the facts and representations
supporting the Department's decision to grant this exemption, refer to
the notice of proposed exemption published on October 17, 1995 at 60 FR
53805.
FOR FURTHER INFORMATION CONTACT: Allison Padams of the Department,
telephone (202) 219-8971. (This is not a toll-free number.)
Rea Magnet Wire Company, Inc. Employees' Retirement Savings Plan and
Rea Magnet Wire Company, Inc. Union Employees' Retirement Savings Plan
(together, the Plans) Located in Fort Wayne, Indiana; Exemption
[Prohibited Transaction Exemption 95-109; Exemption Application Nos.
D-10075 and D-10076]
The restrictions of sections 406(a), 406 (b)(1) and (b)(2) of the
Act and the sanctions resulting from the application of section 4975 of
the Code, by reason of section 4975(c)(1) (A) through (E) of the Code,
shall not apply to the proposed sale by the Plans of two guaranteed
investment contracts (the GICs) of Confederation Life Insurance Company
(CL) to Rea Magnet Wire Company, Inc. (Rea), a party in interest with
respect to the Plans, provided the following conditions are satisfied:
a) the sale is a one-time transaction for cash; b) the Plans will
receive no less than the fair market value of the GICs as of the date
of the sale; and c) the purchase price will be not less than the GICs'
accumulated book values at their maturity date (defined as total
deposits plus interest accrued but unpaid at the GICs' stated rates of
interest through the date of maturity, less withdrawals) plus interest
from the date of maturity through the date of the sale at the rate then
being earned under the Plans' ``GIC/Stable Value Fund''.
For a more complete statement of the facts and representations
supporting the Department's decision to grant this exemption, refer to
the notice of proposed exemption published on September 25, 1995 at 60
FR 49426.
FOR FURTHER INFORMATION CONTACT: Gary H. Lefkowitz of the Department,
telephone (202) 219-8881. (This is not a toll-free number.)
Profit Sharing Plan of NEBCO, Inc. Located in Lincoln, Nebraska;
Exemption
[Prohibited Transaction Exemption 95-110; Exemption Application No.
D-10096]
The restrictions of sections 406(a) and 406 (b)(1) and (b)(2) of
the Act and the sanctions resulting from the application of section
4975 of the Code, by reason of section 4975(c)(1) (A) through (E) of
the Code, shall not apply to (1) the extensions of credit in the form
of guarantees and advances of funds (the Advances) to the Plan by
NEBCO, Inc. (the Employer), the sponsor of the Plan, with respect to
the Guaranteed Investment Contract No. 64238 (the GIC) issued by
Confederation Life Insurance Company of Canada (Confederation); and (2)
the repayment of the Advances by the Plan to the Employer; provided
that the following conditions are satisfied: (a) All terms and
conditions of the transactions are no less favorable to the Plan than
those which the Plan would receive in arm's length transactions; (b) No
interest payments or expenses will be incurred by the Plan with respect
to the transactions; (c) Repayment of the Advances will be restricted
to proceeds from the GIC (GIC Proceeds); (d) Repayment of Advances will
be waived by the Employer to the Extent that Advances exceed the GIC
Proceeds; and (e) All unpaid principal and earned interest of the GIC
will be completely paid by the Advances to the Plan by March 15, 2000.
For a more complete statement of the facts and representations
supporting the Department's decision to grant this exemption refer to
the notice of proposed exemption published on October 6, 1995, at 60 FR
52419.
FOR FURTHER INFORMATION CONTACT: Mr. C.E. Beaver of the Department,
telephone (202) 219-8881. (This is not a toll-free number.)
Profit Sharing Plan of Constructors, Inc. (the Plan) Located in
Lincoln, Nebraska; Exemption
[Prohibited Transaction Exemption 95-111; Exemption Application No.
D-10097]
The restrictions of sections 406(a) and 406 (b)(1) and (b)(2) of
the Act and the sanctions resulting from the application of section
4975 of the Code, by reason of section 4975(c)(1) (A) through (E) of
the Code, shall not apply to (1) the extensions of credit in the form
of guarantees and advances of funds (the Advances) to the Plan by
Constructors, Inc. (the Employer), the sponsor of the Plan, with
respect to the Guaranteed Investment Contract No. 64238 (the GIC)
issued by Confederation Life Insurance Company of Canada
(Confederation); and (2) the repayment of the Advances by the Plan to
the Employer; provided that the following conditions are satisfied: (a)
All terms and conditions of the transactions are no less favorable to
[[Page 63064]]
the Plan than those which the Plan would receive in arm's length
transactions; (b) No interest payments or expenses will be incurred by
the Plan with respect to the transactions; (c) Repayment of the
Advances will be restricted to proceeds from the GIC (GIC Proceeds);
(d) Repayment of Advances will be waived by the Employer to the Extent
that Advances exceed the GIC Proceeds; and (e) All unpaid principal and
earned interest of the GIC will be completely paid by the Advances to
the Plan by March 15, 2000.
For a more complete statement of the facts and representations
supporting the Department's decision to grant this exemption refer to
the notice of proposed exemption published on October 6, 1995, at 60 FR
52421.
FOR FURTHER INFORMATION CONTACT: Mr. C. E. Beaver of the Department,
telephone (202) 219-8881. (This is not a toll-free number.)
Universal Surety Company Profit Sharing Plan (the Plan) Located in
Lincoln, Nebraska; Exemption
[Prohibited Transaction Exemption 95-112; Exemption Application No.
D-10098]
The restrictions of sections 406(a) and 406 (b)(1) and (b)(2) of
the Act and the sanctions resulting from the application of section
4975 of the Code, by reason of section 4975(c)(1) (A) through (E) of
the Code, shall not apply to (1) the extensions of credit in the form
of guarantees and advances of funds (the Advances) to the Plan by
Universal Surety Company (the Employer), the sponsor of the Plan, with
respect to the Guaranteed Investment Contract No. 64238 (the GIC)
issued by Confederation Life Insurance Company of Canada
(Confederation); and (2) the repayment of the Advances by the Plan to
the Employer; provided that the following conditions are satisfied: (a)
All terms and conditions of the transactions are no less favorable to
the Plan than those which the Plan would receive in arm's length
transactions; (b) No interest payments or expenses will be incurred by
the Plan with respect to the transactions; (c) Repayment of the
Advances will be restricted to proceeds from the GIC (GIC Proceeds);
(d) Repayment of Advances will be waived by the Employer to the Extent
that Advances exceed the GIC Proceeds; and (e) All unpaid principal and
earned interest of the GIC will be completely paid by the Advances to
the Plan by March 15, 2000.
For a more complete statement of the facts and representations
supporting the Department's decision to grant this exemption refer to
the notice of proposed exemption published on October 6, 1995, at 60 FR
52422.
FOR FURTHER INFORMATION CONTACT: Mr. C. E. Beaver of the Department,
telephone (202) 219-8881. (This is not a toll-free number.)
Constructors, Inc. 401(k) Plan (the Plan) Located in Lincoln, Nebraska;
Exemption
[Prohibited Transaction Exemption 95-113; Exemption Application No.
D-10099]
The restrictions of sections 406(a) and 406(b)(1) and (b)(2) of the
Act and the sanctions resulting from the application of section 4975 of
the Code, by reason of section 4975(c)(1) (A) through (E) of the Code,
shall not apply to (1) the extensions of credit in the form of
guarantees and advances of funds (the Advances) to the Plan by
Constructors, Inc. (the Employer), the sponsor of the Plan, with
respect to the Guaranteed Investment Contract No. 64238 (the GIC)
issued by Confederation Life Insurance Company of Canada
(Confederation); and (2) the repayment of the Advances by the Plan to
the Employer; provided that the following conditions are satisfied: (a)
All terms and conditions of the transactions are no less favorable to
the Plan than those which the Plan would receive in arm's length
transactions; (b) No interest payments or expenses will be incurred by
the Plan with respect to the transactions; (c) Repayment of the
Advances will be restricted to proceeds from the GIC (GIC Proceeds);
(d) Repayment of Advances will be waived by the Employer to the Extent
that Advances exceed the GIC Proceeds; and (e) All unpaid principal and
earned interest of the GIC will be completely paid by the Advances to
the Plan by March 15, 2000.
For a more complete statement of the facts and representations
supporting the Department's decision to grant this exemption refer to
the notice of proposed exemption published on October 6, 1995, at 60 FR
52424.
FOR FURTHER INFORMATION CONTACT: Mr. C.E. Beaver of the Department,
telephone (202) 219-8881. (This is not a toll-free number.)
General Information
The attention of interested persons is directed to the following:
(1) The fact that a transaction is the subject of an exemption
under section 408(a) of the Act and/or section 4975(c)(2) of the Code
does not relieve a fiduciary or other party in interest or disqualified
person from certain other provisions to which the exemptions does not
apply and the general fiduciary responsibility provisions of section
404 of the Act, which among other things require a fiduciary to
discharge his duties respecting the plan solely in the interest of the
participants and beneficiaries of the plan and in a prudent fashion in
accordance with section 404(a)(1)(B) of the Act; nor does it affect the
requirement of section 401(a) of the Code that the plan must operate
for the exclusive benefit of the employees of the employer maintaining
the plan and their beneficiaries;
(2) These exemptions are supplemental to and not in derogation of,
any other provisions of the Act and/or the Code, including statutory or
administrative exemptions and transactional rules. Furthermore, the
fact that a transaction is subject to an administrative or statutory
exemption is not dispositive of whether the transaction is in fact a
prohibited transaction; and
(3) The availability of these exemptions is subject to the express
condition that the material facts and representations contained in each
application are true and complete and accurately describe all material
terms of the transaction which is the subject of the exemption. In the
case of continuing exemption transactions, if any of the material facts
or representations described in the application change after the
exemption is granted, the exemption will cease to apply as of the date
of such change. In the event of any such change, application for a new
exemption may be made to the Department.
Signed at Washington, D.C., this 5th day of December, 1995.
Ivan Strasfeld,
Director of Exemption Determinations, Pension and Welfare Benefits
Administration, U.S. Department of Labor.
[FR Doc. 95-29985 Filed 12-7-95; 8:45 am]
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