486 Federal Register / Vol. 60, No. 2 / Wednesday, January 4, 1995 / Notices

1Because Mr. Civera is the only participant in the

Plan and the Employer is wholly owned by Mr.

Civera there is no jurisdiction with respect to the

Plan under Title I of the Act pursuant to CFR

2510.3–3(b) and (c). However, there is jurisdiction

under Title II of the Act pursuant to section 4975

of the Code.

2 In this regard, the Plan’s financial statement lists

the aggregate value of the Properties as $485,000.

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 accurately describes all

material terms of the transaction which

is the subject of the exemption.

Signed at Washington, DC, this 29th day of

December, 1994.

Ivan Strasfeld,

Director of Exemption Determinations,

Pension and Welfare Benefits Administration,

U.S. Department of Labor.

[FR Doc. 95–110 Filed 1–3–95; 8:45 am]

BILLING CODE 4510–29–M

[Application No. D–9727, et al.]

Proposed Exemptions; Hospital

Supplies, Inc. Pension Plan, et al.

AGENCY: Pension and Welfare Benefits

Administration, Labor.

ACTION: Notice of proposed exemptions.

SUMMARY: This document contains

notices of pendency before the

Department of Labor (the Department) of

proposed exemptions from certain of the

prohibited transaction restriction of the

Employee Retirement income Security

Act of 1974 (the Act) and/or the Internal

Revenue Code of 1986 (the Code).

Written Comments and Hearing

Requests

All interested persons are invited to

submit written comments or request for

a hearing on the pending exemptions,

unless otherwise stated in the Notice of

Proposed Exemption, within 45 days

from the date of publication of this

Federal Register Notice. Comments and

request for a hearing should state: (1)

the name, address, and telephone

number of the person making the

comment or request, and (2) the nature

of the person’s interest in the exemption

and the manner in which the person

would be adversely affected by the

exemption. A request for a hearing must

also state the issues to be addressed and

include a general description of the

evidence to be presented at the hearing.

A request for a hearing must also state

the issues to be addressed and include

a general description of the evidence to

be presented at the hearing.

ADDRESSES: All written comments and

request for a hearing (at least three

copies) should be sent to the Pension

and Welfare Benefits Administration,

Office of Exemption Determinations,

Room N–5649, U.S. Department of

Labor, 200 Constitution Avenue, N.W.,

Washington, D.C. 20210. Attention:

Application No. stated in each Notice of

Proposed Exemption. The applications

for exemption and the comments

received will be available for public

inspection in the Public Documents

Room of Pension and Welfare Benefits

Administration, U.S. Department of

Labor, Room N–5507, 200 Constitution

Avenue, N.W., Washington, D.C. 20210.

Notice to Interested Persons

Notice of the proposed exemptions

will be provided to all interested

persons in the manner agreed upon by

the applicant and the Department

within 15 days of the date of publication

in the Federal Register. Such notice

shall include a copy of the notice of

proposed exemption as published in the

Federal Register and shall inform

interested persons of their right to

comment and to request a hearing

(where appropriate).

SUPPLEMENTARY INFORMATION: The

proposed exemptions were requested in

applications filed pursuant to section

408(a) of the Act and/or section

4975(c)(2) of the Code, and in

accordance with procedures set forth in

29 CFR Part 2570, Subpart B (55 FR

32836, 32847, August 10, 1990).

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 requested to the Secretary of

Labor. Therefore, these notices of

proposed exemption are issued solely

by the Department.

The applications contain

representations with regard to the

proposed exemptions which are

summarized below. Interested persons

are referred to the applications on file

with the Department for a complete

statement of the facts and

representations.

Hospital Supplies, Inc. Pension Plan

(the Plan) Located in Radnor,

Pennsylvania; Proposed Exemption

[Application No. D–9727]

The Department is considering

granting an exemption under the

authority of section 4975(c)(2) of the

Code and in accordance with the

procedures set forth in 29 C.F.R. Part

2570, Subpart B (55 FR 32836, 32847,

August 10, 1990.) If the exemption is

granted, 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 of two

adjacent parcels of real property (the

Properties) by the Plan to Armond J.

Civera, Jr. (Mr. Civera) 1, a disqualified

person with respect to the Plan,

provided that the following conditions

are satisfied:

(a) the proposed sale will be a onetime cash transaction;

(b) the Plan will receive for each

Property the current fair market value

established at the time of the sale by an

independent qualified appraiser;

(c) the Plan will pay no expenses

associated with the sale.

Summary of Facts and Representations

1. The Plan is a defined benefit

pension plan with one participant, Mr.

Civera, who is also the trustee of the

Plan and the owner of the Plan sponsor.

Mr. Civera is a sole participant of the

Plan. As of December 31, 1993, the

Plan’s assets were $594,061.63.2 The

Plan sponsor is a Pennsylvania

corporation which provides consulting

services to the medical industry and to

the print technology industry (the

Employer).

2. In October 1989, the Plan acquired

a 100 percent interest in a single family

residence built on a 1.17 acres of land,

which is located at 1128 King of Prussia

Road, Tredyffrin Township,

Pennsylvania (Property 1). The total

purchase price of Property 1, including

related closing costs, was $170,000. In

March 1993, the Plan also allocated

approximately $60,000 for certain

structural improvements for Property 1.

This construction work was done by

companies that have no relationship to

the Plan and the Employer. It is

represented that Property 1 was

purchased from Roseanne Koczicki,

who has no relationship to the Plan and

the Employer. In March 1993, the Plan

acquired a 100 percent interest in a

1.026 acre parcel of vacant land

(Property 2), which is adjacent to

Property 1. The total purchase price of

Property 2, including related closing
Federal Register / Vol. 60, No. 2 / Wednesday, January 4, 1995 / Notices 487

3This exemption,if granted, extends relief from

section 4975(c)(1)(D) and (E) of the Code, for the

sale of the Properties by the Plan to a disqualified

person. However, no relief is provided herein for

any prohibited transaction which may have arisen

as a result of the Plan’s acquisition and holding of

the Properties.

4The Department notes that decisions to acquire

and hold the GIC are governed by the fiduciary

responsibility provisions of Part 4 of Title I of the

Act. In this regard the Department is not proposing

relief for any violations of Part 4 which may have

arisen as a result of the acquisition and holding of

the GIC.

costs, was $77,500. Subsequently, the

Plan expended approximately $47,500

for improvements associated with the

subdivision of Property 2. These

improvements were done by entities

that have no relationship to the Plan

and the Employer. It is represented that

Property 2 was purchased from Tom

and Beth Nojunas, who also have no

relationship to the Plan and the

Employer. It is represented that neither

Property is adjacent to any other

properties owned by disqualified

persons, and that neither Property has

ever been used by a disqualified person.

Furthermore, neither of the Properties

are encumbered by any debt.

3. It is represented that Mr. Civera, in

his trustee capacity, made the original

decision to acquire the Properties. The

Properties were originally acquired as

long-term Plan investments and were to

be developed and sold. However, the

real estate market did not perform well

and the Properties did not generate any

income for the Plan. In this regard, it is

represented that Property 1 has been

vacant since it was originally acquired

by the Plan.

4. The Properties were appraised on

May 23, 1994 (collectively; the

Appraisals) by Thomas M. Descano,

ASA, an independent real estate

appraiser certified in the State of

Pennsylvania (Mr. Descano). In

appraising Property 1, Mr. Descano

relied primarily on the market

comparison approach as well as the cost

approach, and determined that the fair

market value of Property 1 was

$200,000. In appraising Property 2, Mr.

Descano determined that the fair market

value was $205,200. In the Appraisal of

Property 2, Mr. Descano stated that the

local market did not provide any

comparable sales of vacant land, and as

such he had to abstract land value from

recent improved property sales. Mr.

Descano represented that this is done by

estimating the depreciated value of the

improvements and then deducting that

value from the sale price, thereby

arriving at the approximate value of the

land. On June 22, 1994, in a

supplemental statement to the

Appraisals, Mr. Descano stated that the

adjacency of Property 1 and Property 2

does not merit a premium above the fair

market value to Mr. Civera, the

purchaser of both Properties.

5. Mr. Civera proposes to purchase the

Properties from the Plan in a one-time

cash transaction. The applicant states

that the proposed exemption would be

in the best interest and protective of the

Plan because the transaction will divest

the Plan of non-income producing

assets, provide the Plan with liquidity,

and enable the Plan to diversify its

assets.3 The applicant also notes that the

transaction is protective of the Plan

because as a result of the sale the Plan

will receive the current fair market

value for each Property established at

the time of the sale by an independent

qualified appraiser.

6. In summary, the applicant

represents that the transaction satisfies

the statutory criteria of section

4975(c)(2) of the Code because:

(a) the proposed sale will be a onetime cash transaction;

(b) the Plan will receive the current

fair market value for each Property

established at the time of the sale by an

independent qualified appraiser;

(c) the Plan will pay no expenses

associated with the sale;

(d) the sale will provide the Plan with

liquidity; and

(e) Mr. Civera as the sole participant

of the Plan will be the only individual

affected by the transaction.

Notice to Interested Persons

Because Mr. Civera is the sole

participant of the Plan, it has been

determined that there is no need to

distribute the notice of proposed

exemption to interested persons.

Comments and requests for a hearing are

due 30 days from the date of publication

of this notice in the Federal Register.

FOR FURTHER INFORMATION CONTACT:

Ekaterina A. Uzlyan of the Department

at (202) 219–8883. (This is not a toll-free

number.)

Jerome Companies Profit Sharing Plan

and Trust (the Plan) Located in Barron,

Wisconsin; Proposed Exemption

[Application No. D–09829]

The Department is considering

granting an exemption under the

authority of section 408(a) of the Act

and section 4975(c)(2) of the Code and

in accordance with the procedures set

forth in 29 CFR Part 2570, Subpart B (55

FR 32836, 32847, August 10, 1990). If

the exemption is granted 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 the Guaranteed

Investment Contract #62043 (the GIC)

issued by Confederation Life Insurance

Company (Confederation), a Canadian

insurance corporation, by the Plan to

Jerome Food, Inc. (the Employer), a

Wisconsin corporation, the sponsoring

employer and a party in interest with

respect to the Plan; provided that (1) the

Sale is a one-time transaction for cash;

(2) the Plan experiences no loss nor

incurs any expense from the Sale; and

(3) the Plan receives as consideration

from the Sale the greater of either the

fair market value of the GIC as

determined on the date of the Sale, or

the principal amount of $500,000 plus

simple interest accrued at the rate of

9.03 percent per annum on the principal

amount of the GIC for the period from

January 25, 1994, to the date of the Sale.

Summary of Facts and Representations

1. The Employer, located in Barron,

Wisconsin, is an integrated turkey

distributor, which raises and slaughters

turkeys, packages and distributes whole

turkeys, and processes and distributes

specialty turkey products, such as

ground turkey and GobbleStix (a

registered trademark of the Employer). It

is a closely held company which

employs approximately 2,400

employees.

2. The Plan is a defined contribution

plan with individual accounts for its

participants that is intended to meet the

qualification requirements of sections

401(a) and 401(k) of the Code. The Plan

intends also to comply with the

provisions of section 404(c) of the Act

whereby participants self-direct the

investments of assets in their respective

individual accounts. As of December 31,

1993, the Plan had approximately 1,466

participants and total assets of

$17,822,946.

In 1990 when the Plan invested in the

GIC, the Vice President of Finance for

the Employer selected various

investment vehicles for the participants

of the Plan, subject to the approval of

the trustee for the Plan, Marquette Bank

Minneapolis, N.A. (subsequently

acquired by First Trust, N.A.) 4 All such

investment decisions are now made by

a subcommittee composed of officers/

employees of the Employer and are

subject to review and approval by the

Corporate Executive Committee, which

consists of the President and 6 Vice

Presidents of the Employer.

The independent trustee for the Plan

is First Trust, N.A. (the Trustee), a

national banking association chartered

by the Comptroller of the Currency. The
488 Federal Register / Vol. 60, No. 2 / Wednesday, January 4, 1995 / Notices

5Section 3.04 of the GIC provides that the GIC

may not be assigned. The applicant is negotiating

with Confederation to obtain a waiver of this

assignment restriction.

Trustee is a wholly-owned subsidiary of

First Bank System, Inc., a Delaware

corporation headquartered in

Minneapolis, Minnesota.

3. Approximately 2.8 percent of the

total assets in the Plan are invested in

the GIC which was acquired by the Plan

on January 25, 1990, for the principal

amount of $500,000. Currently there are

327 participants who have their

respective individual accounts holding

various proportional interests in the

GIC.

The terms of the GIC guarantees the

Plan a non-compounded 9.03 percent

annual rate of return on its $500,000

investment until January 24, 1995, when

the GIC expires and the principal

amount is returned to the Plan. Interest

earned by the GIC is payable to the Plan

each year in January. All annual interest

payments through January 24, 1994,

have been paid by Confederation,

leaving only the interest that has

accrued since January 25, 1994, to be

paid to the Plan. Under the terms of the

GIC, the Plan may not deposit

additional amounts nor withdraw

amounts from its initial $500,000

investment.

4. Confederation, which is owned by

its policyholders, has operations in

Canada, United States and Britain, and

has been in operation 123 years. In the

United States, Confederation operates as

the Confederation Life Insurance and

Annuity Company of Atlanta.

At the time the Plan acquired the GIC,

Standard & Poor’s ranked Confederation

as an ‘‘AAA’’ insurance company.

Beginning in January 1992,

Confederation ratings began to decrease

as it suffered losses in its commercial

mortgage and real estate investments in

the United States and Canada. In April

1994, Confederation disclosed its net

losses for 1993 were $29 million in

Canadian dollars. On August 11, 1994,

the board of directors of Confederation

voted to turn over control of the

Confederation to the Superintendent of

Financial Institutions for Canada. On

August 12, 1994, the Michigan

Insurance Commissioner, through the

Ingham County Circuit Court, Lansing,

Michigan, had Confederation’s United

States subsidiary placed in

conservatorship and rehabilitation to

prevent the transfer of assets of

Confederation located in the United

States. The action by the Michigan

Circuit Court suspended all payments

on contracts of Confederation, including

the GIC. It is not known whether, when,

or under what circumstances

Confederation will resume payments of

interest pursuant to the terms of the GIC

or whether it will be permitted to make

payment of the principal upon maturity

of the GIC.

5. In order to avoid the continued risk

to the participants and beneficiaries of

the Plan from the investment in the GIC,

the Employer proposes to purchase the

GIC from the Plan for cash in a one-time

transaction with no loss nor expense to

the Plan.5 The Employer intends to pay

the Plan the greater of either the fair

market value of the GIC as determined

on the date of the Sale, or the GIC’s

principal amount of $500,000 plus

simple interest accrued at the rate of

9.03 percent per annum on the principal

amount for the period from January 25,

1994, to the date of the Sale. (January

25, 1994, was the last date on which the

Plan received its annual interest

payment from Confederation.)

In addition the applicant represents

that considering the unstable

circumstances of Confederation and the

uncertainty of reimbursing the holders

of the GIC, the proposed Sale will

enable the Plan to recoup its initial

investment plus the accrued interest,

and then invest the proceeds of the Sale

in more stable investments that will

generate a return to the Plan.

In a written statement the Trustee

represented that in its capacity of

independent fiduciary of the Plan and

based upon all the surrounding facts

and circumstances, including the status

of Confederation, that the proposed Sale

is in the best interests of the Plan and

its participants and beneficiaries.

6. In summary, the applicant

represents that the proposed transaction

will satisfy the criteria for an exemption

under section 408(a) of the Act because

(a) the Plan will receive from the

Employer in a one-time transaction cash

in an amount that is not less than the

fair market value of the GIC, or an

amount that is equal to the total amount

paid by the Plan for the GIC, plus

earnings the GIC would have received to

the date of the Sale if Confederation had

not been placed under conservatorship

and rehabilitation by the Circuit Court

of Michigan; (b) the transaction will

enable the Plan and its participants and

beneficiaries to avoid any risk

associated with the continued holding

of the GIC; (c) the Plan will not incur

any loss or expense from the proposed

transaction; and (d) the Trustee of the

Plan has determined that the proposed

transaction is in the best interests of the

Plan and its participants and

beneficiaries.

FOR FURTHER INFORMATION CONTACT: Mr.

C. E. Beaver of the Department,

telephone (202) 219–8881. (This is not

a toll-free number.)

Iron Workers Pension Trust of

Colorado (The Pension Plan); and

Colorado Iron Workers (Erection)

Statewide Joint Apprenticeship and

Trust Fund (the Apprenticeship Plan;

together, the Plans) Located in Denver,

Colorado; Proposed Exemption

[Application Nos. D–9690 and L–9691]

The Department is considering

granting an exemption under the

authority of section 408(a) of the Act

and section 4975(c)(2) of the Code and

in accordance with the procedures set

forth in 29 CFR Part 2570, Subpart B (55

FR 32836, 32847, August 10, 1990). If

the exemption is granted, the

restrictions of section 406(a) 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 (D) of the Code, shall not apply

to the loan (the Loan) of $141,601.36 by

the Pension Plan to the Apprenticeship

Plan, under the terms described in this

notice of proposed exemption, provided

the following conditions are satisfied:

(a) the Loan represents less than 25% of

the assets of the Pension Plan; (b) the

terms of the Loan are not less favorable

to either Plan than those obtainable in

arm’s-length transactions with unrelated

parties; (c) the trustees of each Plan

approved the Loan as being appropriate

for, and in the best interest of each Plan;

(d) no trustee of either Plan made such

determination on behalf of the other

Plan; and (e) the property securing the

Loan (the Property) has been appraised

by a qualified, independent appraiser as

having a fair market value in excess of

150% of the principal amount of the

Loan.

EFFECTIVE DATE: If the proposed

exemption is granted, the exemption

will be effective August 11, 1992.

Summary of Facts and Representations

1. The Pension Plan is a defined

benefit plan which provides retirement

benefits under a unit benefit formula.

The Pension Plan is a Taft-Hartley plan

which is maintained pursuant to a

collective bargaining agreement between

Local 24 of the International Association

of Bridge, Structural and Ornamental

Iron Workers, AFL-CIO (the Union) and

the participating employers. The

Pension Plan had 983 participants as of

March 31, 1991 and total assets of

approximately $36 million as of July 31,

1992.

2. The Apprenticeship Plan is an

employee welfare benefit plan which is
Federal Register / Vol. 60, No. 2 / Wednesday, January 4, 1995 / Notices 489

6On November 1, 1991, Rocky Mountain

Investors, Inc. (now known as RMI) entered into a

Consent Order and Final Judgment (the CO) with

the Department and the United States District for

the District of Colorado in Martin v. Rocky

Mountain Investors, Inc., et.al., Civil Action No. 91–

S–1951 (D. Colo.). Pursuant to that CO, RMI agreed

to comply with all terms of an attached ‘‘Rocky

Mountain Investors, Inc. Investment Policy and

Underwriting Criteria’’ (the Guidelines) in carrying

out its fiduciary responsibilities with respect to

employee benefit plans under the Act. The

Guidelines were incorporated by reference into the

CO. RMI represents that it acted in compliance with

the Guidelines in approving the Loan on behalf of

the Pension Plan, and further that the Loan itself

is in compliance with the Guidelines.

also maintained pursuant to the

collective bargaining agreement between

the Union and the participating

employers. The Apprenticeship Plan is

designed to provide funding for

programs to recruit and train workers as

iron workers and to provide continued

and advanced training for existing iron

workers. The Apprenticeship Plan had

554 participants and assets of $324,262

as of July 31, 1992. The applicants

represent that one employee of the

Apprenticeship Plan is a participant in

the Pension Plan. Therefore, the

Apprenticeship Plan is a party in

interest with respect to the Pension

Plan.

3. On August 11, 1992, the Pension

Plan made the Loan of $141,601.36 to

the Apprenticeship Plan. The Loan

bears interest at a rate of 9.25%, and

calls for equal monthly payments of

$1,457.35, consisting of both principal

and interest, amortized over a 15 year

period. A balloon payment is scheduled

to be made by the Apprenticeship Plan

at the end of the fifth year, at which

time the Loan will be repaid in full.

Spelman Baird & Warner, an

independent mortgage banking firm

located in Denver, Colorado, has

reviewed the terms of the Loan and has

represented that the terms of the Loan

are reasonable and comparable to loans

between unrelated parties being made at

the time the Loan was entered into.

4. The Loan is secured by a first

mortgage on the Property, which is real

estate located at 3385 Walnut Street,

Denver, Colorado. The Property is used

by the Apprenticeship Plan to conduct

the training and apprenticeship

programs offered by the Apprenticeship

Plan. The Property has been appraised

by Curtis W. Wells, MAI, an

independent appraiser in Denver,

Colorado, as having a fair market value

of $233,000 as of June 25, 1992. Thus,

the collateral-to-loan ratio for the Loan

is approximately 165%.

5. The applicants represent that the

Board of Trustees of each Plan

determined that the Loan was in the

best interest of its respective Plan. The

applicants represent that there is one

trustee who is common to both Plans,

but that trustee has and will continue to

abstain from all decisions involving the

Loan. The applicants represent that

none of the other members of either

Board of Trustees will be representing

any interests adverse to those of their

respective Plans and will be acting for

the exclusive benefit of their respective

Plans.

6. RMI Capital Management Co. (RMI)

is a registered investment adviser which

is serving as an independent fiduciary

for the Pension Plan with respect to this

transaction. RMI represents that at the

request of the Pension Plan, RMI

investigated the possibility of the

Pension Plan making the Loan to the

Apprenticeship Plan. RMI determined

that the Loan was a good investment

opportunity for the following reasons:

(a) the Loan was adequately

collateralized by the Property; (b) RMI

negotiated the terms of the Loan with

the Apprenticeship Plan and closed the

transaction; (c) the rate of interest on the

Loan is a market rate of interest which

is consistent with current market rates

being charged by other mortgage

lenders; (d) RMI selected the appraiser

independently and verified the

appraisal as reasonable; and (e) RMI did

an in-depth investigation of the

Apprenticeship Plan’s credit history and

determined that the Apprenticeship

Plan was a good credit risk and would

have no difficulty meeting its

obligations under the Loan.6

7. RMI represents that it is a

partnership owned by JBGP Corporation

and Strategic Property Advisors, Inc.

RMI is not owned or controlled by

either Plan, nor are any of RMI’s

employees participants or employees of

the Plans. RMI represents that with

respect to this transaction, it determined

the facts surrounding the Loan, the

valuation of the Property and the

structure of the Loan. RMI has also

monitored, and will continue to monitor

the Loan on behalf of the Pension Plan

and take whatever action is necessary to

enforce the Pension Plan’s rights under

the Loan.

8. In summary, the applicants

represent that the subject transaction

meets the criteria of section 408(a) of the

Act because: (a) the Loan represents

approximately 0.39% of the assets of the

Pension Plan; (b) the Loan is at fair

market rate terms not less favorable to

either Plan than those obtainable in an

arm’s-length transaction with unrelated

parties; (c) the Property securing the

Loan has been appraised by a qualified,

independent appraiser as having a fair

market value approximately 1.65 times

the principal amount of the Loan; (d)

the trustees of both Plans have

determined that the Loan is in the best

interest of their respective Plans; (e)

RMI, the Pension Plan’s independent

fiduciary, determined that the

transaction is appropriate for, and in the

best interest of, the Pension Plan, and (f)

RMI has monitored, and will continue

to monitor the Loan and take whatever

action is necessary to enforce the

Pension Plan’s rights under the Loan.

NOTICE TO INTERESTED PERSONS: Notice

of the proposed exemption will be

provided by first class mail to all

interested persons within 30 days of the

date of publication of the notice of

pendency in the Federal Register. The

notice will include a copy of the notice

of proposed exemption and will inform

interested persons of their right to

comment with respect to the proposed

exemption. Comments to the

Department are due within 60 days of

the date of publication of this notice of

proposed exemption in the Federal

Register.

FOR FURTHER INFORMATION CONTACT: Gary

H. Lefkowitz of the Department,

telephone (202) 219–8881. (This is not

a toll-free number.)

Employees’ Savings Plan of BassettWalker, Inc. (the Plan) Located in

Martinsville, Virginia; Proposed

Exemption

[Application No. D–09894]

The Department is considering

granting an exemption under the

authority of section 408(a) of the Act

and section 4975(c)(2) of the Code and

in accordance with the procedures set

forth in 29 CFR Part 2570, Subpart B (55

FR 32836, 32847, August 10, 1990). If

the exemption is granted 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 the Guaranteed

Investment Contract No. 62012 (the GIC)

issued by Confederation Life Insurance

Company of Atlanta, Georgia

(Confederation) by the Plan to VF

Corporation, a Pennsylvania corporation

headquartered in Wyomissing,

Pennsylvania, a party in interest with

respect to the Plan; provided that (1) the

Sale is a one-time transaction for cash;

(2) the Plan experiences no loss nor

incurs any expense from the Sale; and

(3) the Plan receives as consideration

from the Sale the greater of either the

fair market value of the GIC as

determined on the date of the Sale, or

$1.5 million, the principal amount of

the GIC, plus simple interest accrued at
490 Federal Register / Vol. 60, No. 2 / Wednesday, January 4, 1995 / Notices

7The Department notes that decisions to acquire

and hold the GIC are governed by the fiduciary

responsibility provisions of Part 4 of Title I of the

Act. In this regard the Department is not proposing

relief for any violations of Part 4 which may have

arisen as a result of the acquisition and holding of

the GIC.

8Section 3.04 of the GIC provides that the GIC

may not be assigned. The applicant represents that

it is negotiating with Confederation to obtain a

waiver of the assignment restriction.

the rate of 8.70 percent per annum on

the principal amount of the GIC for the

period from April 4, 1994, to the date

of the Sale.

Summary of Facts and Representations

1. The sponsoring employer of the

Plan is Bassett-Walker, Inc., a Virginia

corporation headquartered in

Martinsville, Virginia. It is engaged

primarily in the manufacturing and

marketing of high-quality fleece and

printwear. Bassett-Walker, Inc. was

incorporated on September 24, 1984,

and is wholly-owned by VF

Corporation, the proposed purchaser of

the GIC.

VF Corporation, a Pennsylvania

corporation headquartered in

Wyomissing, Pennsylvania, was

incorporated on December 4, 1899, and

has its securities publicly traded on the

New York and Pacific stock exchanges.

It is engaged primarily in the domestic

and international manufacturing and

marketing of jeanswear, casual/

sportswear, and intimate and other

types of apparel.

2. The Plan is a profit sharing plan

that maintains individual accounts for

its participants and is intended to

satisfy the qualification requirements of

sections 401(a) and 401(k) of the Code.

The net assets of the Plan were

$27,158,367, as of December 31, 1993.

There are currently approximately 5,547

participants and beneficiaries of the

Plan.

The applicant represents that the Plan

is administered by a committee (the

Committee) which is appointed by the

sponsoring employer pursuant to the

terms of the Plan. The Committee has

the discretionary responsibility for the

overall administration of the Plan,

including the appointment of legal

counsel, accountants, and the trustee for

the Plan. The current members of the

Committee are Carl Reynolds

(Chairman), Steven Fritz and Margaret

Bouldin (Secretary), who are employees

of the sponsoring employer of the Plan,

and Louis J. Fecile, an officer of VF

Corporation, the proposed purchaser of

the GIC.

The applicant also represents that

UMB Bank, N.A. (formerly known as

United Missouri Bank, N.A.) was

appointed trustee (the Trustee), for the

Plan, effective February 2, 1993. The

Trustee is located in Kansas City,

Missouri. It acts as custodian of the

assets of the Plan, ensures that the assets

of the Plan are held in trust as required

by the Act, and oversees the

establishment and maintenance of

investment and disbursement accounts

of the Plan.

3. The GIC was acquired by the Plan,

effective April 4, 1990, pursuant to $1.5

million tendered by the Plan to

Confederation on April 3, 1990.7 Under

the terms of the GIC, simple interest was

to be paid by Confederation to the Plan

at a guaranteed rate of interest in the

amount of 8.70 percent per annum

through April 3, 1995. All annual

interest payments through April 3, 1994,

have been paid by Confederation,

leaving only the interest yield that

accrued since April 4, 1994, remaining

to be paid to the Plan. Under the terms

of the GIC, the Plan may not deposit

additional amounts to nor withdraw

amounts from its initial $1.5 million

investment. As of August 31, 1994, the

GIC was valued at $1,514,315 and

represented approximately 5.04 percent

of the total value of Plan assets.

On August 12, 1994, the Ingham

County Circuit Court, Lansing, Michigan

placed Confederation in conservatorship

and rehabilitation, causing

Confederation to suspend all payments

on its contracts, including the GIC. The

applicant represents that it is not known

whether, when, or under what

circumstances Confederation will

resume interest payments under the

terms of the GIC or whether it will be

permitted to pay the principal amount

of the GIC to the Plan upon the maturity

of the GIC.

4. In order to eliminate the risk

associated with continued investment in

the GIC and to allow the Plan to

distribute or otherwise invest the assets

of the Plan currently invested in the GIC

in more stable investments that produce

a return to the Plan, VF Corporation

proposes to purchase the GIC from the

Plan.8 The applicant represents that the

Sale would eliminate the risks inherent

in the continued investment in the GIC

by the Plan and would be in the best

interests of the Plan and its participants

and beneficiaries.

The Trustee in a letter dated

November 10, 1994 also has represented

that the Sale as proposed is in the best

interests of the Plan and its participants

and beneficiaries and that the proposed

transaction is protective of the rights of

the Plan participants and beneficiaries.

The applicant states that the Sale

would be a one-time transaction for cash

and the Plan would not incur any

expenses from the Sale nor experience

any loss. The applicant also states that

the Plan would receive as consideration

for the Sale the greater of either the fair

market value of the GIC as determined

by the Trustee on the date of the Sale,

or the amount of funds expended by the

Plan in acquiring the principal amount

of the GIC plus any interest accrued and

not paid on the GIC until the date of the

Sale.

5. In summary, the applicant

represents that the proposed transaction

will satisfy the criteria for an exemption

under section 408(a) of the Act because

(a) the Plan will receive from the Sale

in a one-time transaction cash in

amount that is not less than the fair

market value of the GIC as determined

by the Trustee, or an amount that is

equal to the total amount paid by the

Plan for the GIC plus earnings the GIC

would have paid to the date of the Sale

if Confederation had not been placed

under conservatorship and

rehabilitation by the Circuit Court of

Michigan; (b) the transaction will enable

the Plan and its participants and

beneficiaries to eliminate any risk from

continued holding of the GIC and invest

the funds from the transaction in more

stable and paying investments; (c) the

Plan will not incur any loss nor expense

from the proposed transaction; and (d)

the Trustee of the Plan has determined

that the proposed transaction is in the

best interests of the Plan and its

participants and beneficiaries as well as

protective of the rights of the

participants and beneficiaries.

FOR FURTHER INFORMATION CONTACT: Mr.

C. E. Beaver of the Department,

telephone (202) 219–8881. (This is not

a toll-free number.)

Employee Profit Sharing-Savings Plan

and Trust Agreement of Modern Globe,

Inc. (the Plan) Located in Wyomissing,

Pennsylvania; Proposed Exemption

[Application No. D–09893]

The Department is considering

granting an exemption under the

authority of section 408(a) of the Act

and section 4975(c)(2) of the Code and

in accordance with the procedures set

forth in 29 CFR Part 2570, Subpart B (55

FR 32836, 32847, August 10, 1990). If

the exemption is granted 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 the Guaranteed

Investment Company Contract No.

62580 (the GIC), issued by

Confederation Life Insurance of Atlanta,
Federal Register / Vol. 60, No. 2 / Wednesday, January 4, 1995 / Notices 491

9The Plan was originally sponsored by Modern

Globe, Inc., a Delaware corporation, which was

wholly-owned by the Employer. As of December 1,

1992, Modern Globe, Inc. ceased to exist when it

was merged into another wholly-owned subsidiary

of the Employer.

10The Department notes that decisions to acquire

and hold the GIC are governed by fiduciary

responsibility provisions of Part 4 of Title I of the

Act. In this regard the Department is not proposing

relief for any violations of Part 4 which may have

arisen as a result of the acquisition and holding of

the GIC.

11Although section 3.04 of the GIC provides that

it may not be assigned, the applicant represents that

it is negotiating with Confederation to obtain a

waiver of the assignment restriction.

Georgia (Confederation), by the Plan to

VF Corporation, a Pennsylvania

corporation (the Employer), the

sponsoring employer and a party in

interest with respect to the Plan;

provided that (1) the Sale is a one-time

transaction for cash; (2) the Plan

experiences no loss nor incurs any

expense from the Sale; and (3) the Plan

receives as consideration from the Sale

the greater of either the fair market

value of the GIC as determined on the

date of the Sale, or an amount that is

equal to the total amount expended by

the Plan when acquiring the GIC, plus

all interest accruing under the terms of

the GIC until date of Sale.

Summary of Facts and Representations

1. The Employer, a Pennsylvania

corporation which was incorporated on

December 4, 1899, is headquartered in

Wyomissing, Pennsylvania, and its

securities are publicly traded on the

New York and Pacific stock exchanges.

It is primarily engaged in the domestic

and international manufacturing and

marketing of jeanswear, casual/

sportswear, and intimate and other

types of apparel.

2. The Plan is a profit sharing plan

that maintains individual accounts for

its 838 participants and beneficiaries

and is intended to satisfy the

qualification requirements of sections

401(a) and 401(k) of the Code.9 The net

assets of the Plan were $12,468,562, as

of December 31, 1993. The Plan was

‘‘frozen’’ effective December 31, 1992,

resulting in no further contributions nor

participants being added to the Plan;

and all active participants became fully

vested in their respective account

balances. Under the amendments

adopted December 1, 1992, the

Employer was designated sponsor of the

Plan and UMB Bank, N.A. of Kansas

City, Missouri (the Trustee) became

trustee of the Plan. The Trustee is

custodian of Plan assets and oversees

the establishment and maintenance of

the investment and disbursement

accounts for the Plan.

The Plan is administered by VF

Pension Plan Committee (the

Committee) which is appointed by the

Board of Directors of the Employer. The

Committee is responsible for the

administration of the Plan, and appoints

legal counsel, accountants, and the

Trustee for the Plan. The members of

the Committee are Harold E. Addis,

Frank C. Pickard III, and Lori M.

Tarnoski, each of whom is an officer of

the Employer.

3. Confederation issued the GIC to the

Plan effective November 20, 1991, for

the consideration of $2 million.10 The

terms of the GIC provide that

compounded interest is to accrue at the

guaranteed rate of 6.50 percent per

annum on the principal amount of the

GIC through November 19, 1994, at

which time the accrued interest and

principal amount of the GIC is to be

paid to the Plan. As of August 31, 1994,

the applicant represents that the GIC

was valued at $2,381,958 and equaled

approximately 21.09 percent of the total

value of the Plan assets.

On August 12, 1994, the Ingham

County Circuit Court, Lansing,

Michigan, placed Confederation in

conservatorship and rehabilitation,

causing Confederation to suspend all

payments on its contracts, including the

GIC. The applicant represents that it is

not known whether, when, or under

what circumstances Confederation will

resume payments on its contracts,

including payment of the interest and

the principal amount of the GIC.

4. In order to eliminate the risk

associated with continued investment in

the GIC by the Plan and to allow the

Plan to distribute or otherwise invest

the assets currently invested in the GIC,

the Employer proposes to purchase the

GIC from the Plan.11 The applicant

represents that the elimination of the

risks inherent in the continued

investment in the GIC by the Plan

would be in the best interests of the

Plan and its participants and

beneficiaries and would serve to protect

their rights under the Plan.

The applicant represents that the

Employer will pay the Plan for the GIC

in a one-time transaction for cash, and

any expenses in connection with the

transaction will be absorbed by the

Employer with the Plan experiencing no

loss nor incurring any expense from the

transaction. Also, the applicant

represents that the GIC would be either

purchased from the Plan at the higher of

(1) its fair market value, as determined

by the Trustee at the time of the Sale,

or (2) at the amount expended by the

Plan when acquiring the GIC plus all the

interest accruing under the terms of the

GIC until the date of the Sale.

In addition, the Trustee has

represented in a letter dated November

10, 1994, that in its opinion the

proposed purchase of the GIC by the

Employer is in the best interests of the

Plan and its participants and

beneficiaries. Furthermore, the Trustee

expressed the opinion that the proposed

transaction is protective of the rights of

the Plan’s participants and beneficiaries.

5. In summary, the applicant

represents that the proposed transaction

will satisfy the criteria for an exemption

under section 408(a) of the Act because

(a) the Plan will receive from the

Employer in a one-time transaction cash

the greater of the fair market value of the

GIC as determined by the Trustee, or an

amount that is equal to the total amount

expended by the Plan in acquiring the

GIC plus all interest accruing under the

terms of the GIC until the date of Sale;

(b) the transaction will enable the Plan

and its participants and beneficiaries to

avoid any risk associated with the

continued holding of the GIC; (c) the

Plan will not incur any loss or expense

from the proposed transaction; and (d)

the Trustee of the Plan has determined

that the proposed transaction is in the

best interests of the Plan and its

participants and beneficiaries and

would serve to protect their rights under

the Plan.

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 of

disqualified person from certain other

provisions of the Act and/or the Code,

including any prohibited transaction

provisions to which the exemption 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) Before an exemption may be

granted under section 408(a) of the Act

and/or section 4975(c)(2) of the Code,

the Department must find that the
492 Federal Register / Vol. 60, No. 2 / Wednesday, January 4, 1995 / Notices

exemption is administratively feasible,

in the interests of the plan and of its

participants and beneficiaries and

protective of the rights of participants

and beneficiaries of the plan;

(3) The proposed exemptions, if

granted, will be supplemental to, and

not in derogation of, any other

provisions of the Act and/or the Code,

including statutory or administrative

exemptions and transitional 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

(4) The proposed exemptions, if

granted, will be subject to the express

condition that the material facts and

representations contained in each

application are true and complete, and

that each application accurately

describes all material terms of the

transaction which is the subject of the

exemption.

Signed at Washington, DC, this 29th day of

December, 1994.

Ivan Strasfeld,

Director of Exemption Determinations,

Pension and Welfare Benefits,

Administration, U.S. Department of Labor.

[FR Doc. 95–109 Filed 1–3–95; 8:45 am]

BILLING CODE 4510–29–P

[Prohibited Transaction Exemption 94–82]

Marshall & Ilsley Trust Company

AGENCY: Department of Labor.

ACTION: Notice of technical correction.

On December 5, 1994, the Department

of Labor (the Department) published in

the Federal Register (59 FR 62422) and

individual exemption which permits:

(1) the in-kind transfer of assets of plans

for which Marshall & Ilsley Trust

Company or an affiliate (collectively,

M&I) serves as a fiduciary (the Client

Plans), other than plans established and

maintained by M&I, that are held in

certain collective investment funds

maintained by M&I (the CIFs), in

exchange for shares of the Marshall

Funds, Inc. (the Funds), an open-end

investment company registered under

the Investment Company Act of 1940,

for which M&I acts as investment

adviser, custodian, and/or shareholder

servicing agent, in connection with the

termination of such CIFs; (2) the receipt

of fees by M&I from the Funds for acting

as an investment adviser to the Funds

in connection with the investment by

the Client Plans in shares of the Funds;

and (3) the receipt and proposed

retention of fees by M&I from the Funds

for acting as custodian and shareholder

servicing agent to the Funds as well as

for any other services to the Funds

which are not investment advisory

services (i.e. ‘‘secondary services’’) in

connection with the investment by the

Client Plans in shares of the Funds.

Section I(f) in the first column on 59

FR 62423 should read as follows:

(f) The conditions set forth in

paragraphs (e), (f) and (n) of Section II

below are satisfied.

For Further Information Contact: Mr.

E.F. Williams, of the Department, at

(202) 219–8194.

Signed at Washington, DC, this 29th day of

December, 1994.

Ivan L. Strasfeld,

Director, Office of Exemption Determinations,

Pension and Welfare Benefits Administration.

[FR Doc. 95–111 Filed 1–3–95; 8:45 am]

BILLING CODE 4510–29–M

NATIONAL AERONAUTICS AND

SPACE ADMINISTRATION

[Notice 94–105]

NASA Advisory Council, NASA Federal

Laboratory Review Task Force;

Meeting

AGENCY: National Aeronautics and

Space Administration.

ACTION: Notice of Meeting.

SUMMARY: In accordance with the

Federal Advisory Committee Act, Pub.

L. 92–463, as amended, the National

Aeronautics and Space Administration

announces a meeting of the NASA

Federal Laboratory Review Task Force

of the NASA Advisory Council.

DATES: January 26, 1995, 12:30 p.m. to

4:15 p.m.

ADDRESSES: National Aeronautics and

Space Administration, Program Review

Center, Ninth Floor, Room 9H40, 300 E

Street, SW., Washington, DC 20546.

FOR FURTHER INFORMATION CONTACT:

Richard L. Kline, Code AE, National

Aeronautics and Space Administration,

Washington, DC 20546, 202/358–4697.

SUPPLEMENTARY INFORMATION: The

meeting will be open to the public up

to the seating capacity of the room. The

agenda for the meeting is as follows:

—General Findings and

Recommendations

—Aeronautics Enterprise

Recommendations

—Scientific Research Enterprise

Recommendations

—Mission to Planet Earth Enterprise

Recommendations

—Space Technology Enterprise

Recommendations

—Human Exploration and Development

of Space Enterprise Recommendations

—Discussion

It is imperative that the meeting be

held on this date to accommodate the

scheduling priorities of the key

participants. Visitors will be requested

to sign a visitors’ register.

Dated: December 22, 1994.

Timothy M. Sullivan,

Advisory Committee Management Officer.

[FR Doc. 95–135 Filed 1–3–95; 8:45 am]

BILLING CODE 7510–01–M

NATIONAL FOUNDATION ON THE

ARTS AND THE HUMANITIES

Meetings of Humanities Panel

AGENCY: National Endowment for the

Humanities.

ACTION: Notice of meetings.

SUMMARY: Pursuant to the provisions of

the Federal Advisory Committee Act

(Public Law 92–463, as amended),

notice is hereby given that the following

meetings of the Humanities Panel will

be held at the Old Post Office, 1100

Pennsylvania Avenue, N.W.,

Washington, DC 20506.

FOR FURTHER INFORMATION CONTACT:

David C. Fisher, Advisory Committee

Management Officer, National

Endowment for the Humanities,

Washington, DC 20506; telephone (202)

606–8322. Hearing-impaired individuals

are advised that information on this

matter may be obtained by contacting

the Endowment’s TDD terminal on (202)

606–8282.

SUPPLEMENTARY INFORMATION: The

proposed meetings are for the purpose

of panel review, discussion, evaluation

and recommendation on applications

for financial assistance under the

National Foundation on the Arts and the

Humanities Act of 1965, as amended,

including discussion of information

given in confidence to the agency by the

grant applicants. Because the proposed

meetings will consider information that

is likely to disclose: (1) trade secrets and

commercial or financial information

obtained from a person and privileged

or confidential; or (2) information of a

personal nature the disclosure of which

would constitute a clearly unwarranted

invasion of personal privacy, pursuant

to authority granted me by the

Chairman’s Delegation of Authority to

Close Advisory Committee meetings,

dated July 19, 1993, I have determined

that these meetings will be closed to the

public pursuant to subsections (c)(4),

and (6) of section 552b of Title 5, United

States Code.

1. Date: January 23, 1995

Time: 8:30 a.m. to 5:00 p.m.