[Federal Register Volume 59, Number 180 (Monday, September 19, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-23120]
[[Page Unknown]]
[Federal Register: September 19, 1994]
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DEPARTMENT OF LABOR
Pension and Welfare Benefits Administration
[Prohibited Transaction Exemption 94-67; Exemption Application No. D-
9646, et al.]
Grant of Individual Exemptions; The Bally Manufacturing
Corporation, 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 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.
The Bally Manufacturing Corporation, Bally's Employee Savings Trust
for Administrative Employees, et al. (the Plans), Located in
Chicago, IL
[Prohibited Transaction Exemption 94-67; Application Nos. D-9646 and
D-9647]
Exemption
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 (1) the advance of funds (the Advances) to the
master trust which was established to hold the assets of the Plans (the
Master Trust) by Bally Manufacturing Corporation (the Employer), a
party in interest with respect to the Plans and the Master Trust, and
(2) the Master Trust's potential repayment of the Advances upon the
receipt by the Master Trust of payments under two guaranteed investment
contracts (the GICs) issued by Executive Life Insurance Company
(Executive Life); provided the following conditions are satisfied:
(A) No interest or expenses are paid by the Plans in connection
with the transaction;
(B) The Advances will be repaid only out of amounts paid to the
Master Trust by Executive Life, its successors, or any other
responsible third party; and
(C) Repayment of the Advances is waived with respect to the amount
by which the Advances exceed GIC proceeds.
Comments
In the Notice of Proposed Exemption, the Department invited all
interested persons to submit written comments and requests for a
hearing on the exemption. All comments and requests for hearing were
due by September 10, 1994. The Department received two written comments
and there were no requests for a hearing. Both commentators were in
favor of the exemption and urged the Department to allow the Employer
to make the Advances so that participants could receive distribution of
their Plan benefits.
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 July 27, 1994 at 59 FR
38209.
FOR FURTHER INFORMATION CONTACT: Virginia J. Miller of the Department,
telephone (202) 219-8971. (This is not a toll-free number.)
Profit Sharing Plan for Employees of Lewis-Gale Clinic, Inc. (the
Plan), Located in Salem, Virginia
[Prohibited Transaction Exemption 94-68; Exemption Application No.
D-9654]
Exemption
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 the proposed cash sale (the Sale) of certain shares
of stock (the Shares) from certain individually-directed accounts in
the Plan (the Accounts) to Lewis-Gale Clinic, Inc. (the Clinic), a
party in interest with respect to the Plan.
This exemption is conditioned on the following requirements: (1)
the terms and conditions of the Sale are at least as favorable to the
Accounts as those obtainable in an arm's length transaction with an
unrelated party; (2) the Sale is a one-time cash transaction; (3) the
Accounts are not required to pay any commissions, costs or other
expenses in connection with the Sale; (4) the Sales price for the
Shares is based upon their fair market value as determined by a
qualified, independent appraiser; and (5) within ninety days of the
publication in the Federal Register of the grant of this exemption, the
Clinic files Forms 5330 with the Internal Revenue Service and pays all
applicable excise taxes due with respect to past prohibited
transactions.
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 July 27, 1994, at 59 FR
38206.
FOR FURTHER INFORMATION CONTACT: Kathryn Parr of the Department,
telephone (202) 219-8971. (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 14th day of September, 1994.
Ivan Strasfeld,
Director of Exemption Determinations Pension and Welfare Benefits
Administration, U.S. Department of Labor.
[FR Doc. 94-23120 Filed 9-16-94; 8:45 am]
BILLING CODE 4510-29-P
