Federal Register / Vol. 61, No. 108 / Tuesday, June 4, 1996 / Notices 28243

objectives, the Employer and the

Committee determined that the most

expeditious means would be the

Employer’s cash purchase of the Plan’s

remaining interest in the GIC. The

Employer requests an exemption for this

transaction under the terms and

conditions described herein.

5. The Employer proposes that the

Plan transfer to the Employer the Plan’s

entire remaining interest in the GIC in

exchange for a cash purchase price in

the amount of the Plan’s GIC Interest

principal investment attributable to the

Surviving Claim plus interest at the

Contract Rate effective August 8, 1986

through the date of the purchase. The

Plan will incur no expenses with

respect to the proposed transaction.

Subsequent to the purchase, the

Employer, as owner of the GIC Interest,

will receive the Rehab Payments with

respect to the Surviving Claim, which

includes interest at four percent. In the

event the Employer receives funds from

any source with respect to the Surviving

Claim in excess of the purchase price

paid to the Plan by the Employer, such

excess will be paid to the Plan.

6. The Employer is requesting that the

exemption, if granted, be effective as of

June 17, 1996. The Employer explains

that its reorganizational activities

commencing with its acquisition by

TWI subsidiaries in January 1996 have

led to a greater number of Plan

participant terminations than usual.

Whereas the Plan has permitted

distributions only annually, the New

Plan enables distributions on a monthly

basis. Because distributions to many

former participants of the Plan are

pending, the Employer desires to enable

distributions to be processed in the June

1996 processing cycle of the New Plan.

This will require the completed

liquidation of the GIC Interest by June

17, 1996. Accordingly, the Employer

intends to consummate the proposed

purchase transaction on that date under

the terms and conditions described

above.

7. In summary, the applicant

represents that the proposed

transactions satisfy the criteria of

section 408(a) of the Act for the

following reasons: (1) The transaction

will provide the Plan with an immediate

return on its investment in the

Surviving Claim at a rate of interest, the

Contract Rate, which is higher than the

Rehab Rates; (2) The proposed transfer

of the GIC Interest to the Employer for

a cash purchase price will be a onetime transaction in which the Plan

receives no less than the greater of the

fair market value of the GIC Interest or

the Plan’s principal investment

attributable to the Surviving Claim plus

interest through the purchase date at the

Contract Rate; (3) The Plan will incur no

expenses with respect to the proposed

transaction; and (4) In the event the

Employer receives payments with

respect to the GIC Interest in excess of

the purchase price paid the Plan, such

excess will be paid to the Plan.

FOR FURTHER INFORMATION CONTACT:

Ronald Willett 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

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 30th day of

May, 1996.

Ivan Strasfeld,

Director of Exemption Determinations,

Pension and Welfare Benefits Administration,

U.S. Department of Labor.

[FR Doc. 96–13916 Filed 6–3–96; 8:45 am]

BILLING CODE 4510–29–P

[Prohibited Transaction Exemption 96–14;

Exemption Application No. D–09940]

Morgan Stanley & Co. Incorporated

(MS&Co) and Morgan Stanley Trust

Company (MSTC)

AGENCY: Pension and Welfare Benefits

Administration, Labor (the Department).

ACTION: Notice of technical correction.

On March 12, 1996, the Department

published in the Federal Register (61

FR 10032) a notice granting an

individual exemption (the Exemption)

on behalf of MS&Co and MSTC

(collectively, the Applicants). The first

paragraph of the Exemption states, in

pertinent part, that ‘‘the restrictions of

sections 406(a)(1)(A) through (D) 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 lending

of securities to Morgan Stanley & Co.,

Incorporated (MS&Co) and to any other

U.S. registered broker-dealers affiliated

with Morgan Stanley Trust Company

(the Affiliated Broker-Dealer,

collectively, the MS Broker-Dealers) by

employee benefit plans with respect to

which MS&Co is a party in

interest * * *’’

The Applicants believe that the

aforementioned language should have

referred to an MS Broker-Dealer, as a

party in interest rather than to MS&Co

because the exemption application

contemplated that an MS Broker-Dealer,

other than MS&Co, might be borrowing

securities from a plan with respect to

which such MS Broker-Dealer, but not

necessarily MS&Co, is a party in

interest. Therefore, the Department has

amended the first paragraph of the

Exemption to read as follows:

‘‘The restrictions of sections 406(a)(1)(A)

through (D) 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 lending of

securities to Morgan Stanley & Co.

Incorporated (MS&Co) and to any other U.S.

registered broker-dealers affiliated with

Morgan Stanley Trust Company (the

Affiliated Broker-Dealer; collectively, the MS

Broker- Dealers) by employee benefit plans

with respect to which the MS Broker-Dealer

who is borrowing such securities is a party
28244 Federal Register / Vol. 61, No. 108 / Tuesday, June 4, 1996 / Notices

in interest or for which Morgan Stanley Trust

Company (MSTC) acts as directed trustee or

custodian and securities lending agent and to

the receipt of compensation by MSTC in

connection with these transactions, provided

that the following conditions are met:’’

In addition, the Department has

revised the reference to MS&Co in the

fourth line of the fourth paragraph of

Section 2 of the Written Comments of

the Exemption (published at page

10033) to MS Broker-Dealer.

FOR FURTHER INFORMATION CONTACT: Ms.

Jan D. Broady of the Department,

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

a toll-free number.)

Signed at Washington, DC, this 30th day of

May 1996.

Ivan L. Strasfeld,

Director of Exemption Determinations,

Pension and Welfare Benefits Administration,

U.S. Department of Labor.

[FR Doc. 96–13914 Filed 6–3–96; 8:45 am]

BILLING CODE 4510–29–P

[Prohibited Transaction Exemption 96–44;

Exemption Application No. D–10049, et al.]

Grant of Individual Exemptions;

Sprague Electric Company

AGENCY: Pension and Welfare Benefits

Administration, Labor.

ACTION: Grant of individual exemptions.

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.

Sprague Electric Company Retirement

and Savings Plan (the Plan) Located in

Cincinnati, Ohio

[Prohibited Transaction Exemption 96–44;

Exemption Application No. D–10049]

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 cash

sale (the Sale) by the Plan of its 34.2

interest in both the Group Annuity

Contract No. CG 0128203A (ELIC

Contract) issued by Executive Life

Insurance Company and the Group

Annuity Contract No. GA–4724 (MBL

Contract) issued by Mutual Benefit Life

Insurance Company to American

Annuity Group, Inc., a party in interest

with respect to the Plan; provided that

the following conditions are met: (1) the

Sale is a one-time transaction for cash;

(2) the Plan experiences no loss and

incurs no expense from the Sale; (3) the

Plan receives as consideration for the

Sale the greater of either (a) 34.2 percent

of the fair market value of the ELIC

Contract and the MBL Contract,

respectively, as determined on the date

of the Sale, or (b) 34.2 percent of the

accumulated book value of the ELIC

Contract and the MBL Contract,

respectively, as set forth in paragraph 4

of the notice of the proposed exemption,

with such determinations as to the

consideration for the Sale made by the

State Street Bank and Trust Company,

the Plan fiduciary.

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 April

4, 1996, at 61 FR 15140.

Comments

The Department received three

written comments from retired

participants of the Plan with respect to

the notice of the proposed exemption.

These comments did not relate to the

subject Sale transaction. Accordingly,

after giving full consideration to the

entire record, the Department has

determined to grant the exemption.

FOR FURTHER INFORMATION CONTACT: Mr.

C. E. Beaver of the Department,

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

a toll-free number.)

Dauphin Deposit Bank and Trust

Company Located in Harrisburg,

Pennsylvania

[Prohibited Transaction Exemption 96–45;

Application No. D–10187]

Section I—Exemption for In-Kind

Transfer of CIF Assets

The restrictions of sections 406(a) and

406(b) 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 (F) of the Code,

shall not apply, as of May 31, 1996 to

the proposed in-kind transfer of assets

of plans for which Dauphin Deposit

Bank and Trust Company (Dauphin)

acts as a fiduciary (the Client Plans),

other than plans established and

maintained by Dauphin (the Bank

Plans), that are held in certain collective

investment funds maintained by

Dauphin (CIFs) in exchange for shares of

the Marketvest Funds (the Funds), openend investment companies registered

under the Investment Company Act of

1940 (the 1940 Act), in situations where

Dauphin acts as investment advisor for

the Fund and may provide some other

‘‘Secondary Service’’ to the Fund as

defined in Section V(h), in connection

with the termination of such CIFs,

provided that the following conditions

and the general conditions of Section III

are met:

(a) No sales commissions or other fees

are paid by the Client Plans in

connection with the purchase of Fund

shares through the in-kind transfer of

CIF assets, and no redemption fees are

payable in connection with the sale of

such shares by the Client Plans to the

Funds.

(b) Each Client Plan receives shares of

a Fund which have a total net asset

value that is equal to the value of the

Plan’s pro rata share of the assets of the