Skip to page content
Secretary of Labor Thomas E. Perez

EBSA (Formerly PWBA) Federal Register Notice

Grant of Individual Exemptions; Biscayne Bay Pilots, Inc. [04/24/1996]

[PDF Version]

Volume 61, Number 80, Page 18159-18161

=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF LABOR
Pension and Welfare Benefits Administration
[Prohibited Transaction Exemption 96-24; Exemption Application No. D-
10036 and D-10037, et al.]
 
Grant of Individual Exemptions; Biscayne Bay Pilots, Inc.
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.

Biscayne Bay Pilots, Inc. Money Purchase Pension Plan (M/P Plan) and 
Biscayne Bay Pilots, Inc. 401(k) Profit Sharing Plan (P/S Plan; 
collectively, the Plans), Located in Miami, Florida

[Prohibited Transaction Exemption 96-24; Exemption Application Nos. D-
10036 and D-10037]

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 the sale of certain improved real property (the 
Property) by a trust (the HK Trust) established on behalf of Helge 
Krarup (Mr. Krarup) within the Plans to Mr. Krarup, a party in interest 
with respect to the Plans; provided that the following conditions are 
satisfied:
    (a) the sale will be a one-time cash transaction;
    (b) the HK Trust will receive the current fair market value for the 
Property established at the time of the sale by an independent 
qualified appraiser;
    (c) the HK Trust will pay no expenses associated with the sale;
    (d) the sale will provide the HK Trust with liquidity; and
    (e) only the assets in the HK Trust will be affected by the 
transaction.

FOR FURTHER INFORMATION CONTACT: Ekaterina A. Uzlyan of the Department 
at (202) 219-8883. (This is not a toll-free number.)

Zausner Foods Corp. Savings Plus Plan (the Plan), Located in New 
Holland, Pennsylvania

[Prohibited Transaction Exemption 96-25; Exemption Application No. D-
10064]

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 the past sale by the Plan of certain units of 
limited partnership interests (the Units) to Zausner Foods Corp. 
(Zausner Foods), a party in interest with respect to the Plan, provided 
that the following conditions were satisfied: (1) The sale was a one-
time transaction for cash; (2) the Plan paid no commissions nor other 
expenses relating to the sale; and (3) the purchase price was the 
greater of: (a) the fair market value of the Units as determined by a 
qualified, independent appraiser, or (b) the original acquisition cost 
of the Units plus attributable opportunity costs.


[[Page 18160]]


EFFECTIVE DATE: December 29, 1995.
    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 March 5, 1996 at 61 FR 
8683.

FOR FURTHER INFORMATION CONTACT: Karin Weng of the Department, 
telephone (202) 219-8881. (This is not a toll-free number.)

Jack, Lyon & Jones, P.A. Profit Sharing Plan (the Plan), Located in 
Little Rock, AR

[Prohibited Transaction Exemption 96-26; Exemption Application No. D-
10071]

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 the (1) Proposed purchase by the Plan of certain 
improved real property (the Property) from Jack, Lyon & Jones, P.A., 
(the Employer), a party in interest with respect to the Plan; (2) the 
subsequent leasing (the Lease) of the Property by the Plan to the 
Employer; and (3) the potential future repurchase of the Property by 
the Employer from the Plan pursuant to the terms of an option agreement 
(the Option Agreement).
    This exemption is conditioned on the following requirements:
    (a) The interests of the Plan with respect to the purchase of the 
Property, the execution and maintenance of the Lease and the potential 
repurchase of the Property by the Employer will be represented by First 
Commercial Trust Company (FCTC) of Little Rock, Arkansas, which will 
serve as the independent fiduciary.
    (b) FCTC does not and will not derive more than one percent of its 
gross business revenues from the Employer and/or its principals for 
each fiscal year that it serves as the independent fiduciary for the 
Plan with respect to the transactions described herein.
    (c) FCTC will evaluate the transactions, determine that such 
transactions are in the best interests of the Plan, and monitor and 
enforce compliance with the terms and conditions of the transactions 
and the exemption, at all times.
    (d) The acquisition price for the Property will be paid by the Plan 
in cash and will be based upon the fair market value of the Property as 
determined by a qualified, independent appraiser.
    (e) The fair market value of the Property will not exceed 25 
percent of the assets of the Plan.
    (f) The terms of the Lease will remain at least as favorable to the 
Plan as those obtainable in an arm's length transaction with an 
unrelated party.
    (g) The fair market rental amount will be redetermined every three 
years that the Lease is in effect by a qualified, independent appraiser 
who has been selected by FCTC and, FCTC will then make appropriate 
adjustments to such rent.
    (h) The Employer will be obligated for all real estate taxes, 
utility costs, fees and insurance premiums that are incidental to the 
Lease.
    (i) The Option Agreement will enable the Plan to sell the Property 
to the Employer in the event that FCTC determines that it is not in the 
best interest of the Plan to retain the Property.
    (j) The Option Agreement will provide that the Employer repurchase 
the Property from the Plan for cash in an amount which is not less than 
the greater of (1) the Plan's acquisition cost for the Property or (2) 
the fair market value of the Property as determined by a qualified, 
independent appraiser who has been selected by FCTC.
    (k) The Plan will pay no real estate fees, commissions or other 
expenses in connection with the acquisition of the Property, the 
administration of the Lease or the repurchase of the Property by the 
Employer under the Option Agreement.
    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 February 13, 1996 at 61 
FR 5574.

FOR FURTHER INFORMATION CONTACT: Ms. Jan D. Broady of the Department, 
telephone (202) 219-8881. (This is not a toll-free number.)

IRA Rollover FBO John W. Meisenbach (the IRA), Located in Seattle, 
Washington

[Prohibited Transaction Exemption 96-27; Exemption Application No. D-
10114]

Exemption

    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 sale by the IRA of certain stock (the Stock) to John 
W. Meisenbach, a disqualified person with respect to the IRA, provided 
that the following conditions are satisfied: (a) the sale is a one-time 
transaction for cash; (b) the IRA pays no commissions nor other 
expenses relating to the sale; and (c) the purchase price is the fair 
market value of the Stock as determined by a qualified, independent 
appraiser as of the date of the sale.<SUP>*
---------------------------------------------------------------------------

    \*\ Pursuant to 29 CFR 2510.3-2(d), the IRA is not within the 
jurisdiction of Title I of the Act. However, there is jurisdiction 
under Title II of the Act pursuant to section 4975 of the Code.
---------------------------------------------------------------------------

    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 March 5, 1996 at 61 FR 
8684.

FOR FURTHER INFORMATION CONTACT: Karin Weng of the Department, 
telephone (202) 219-8881. (This is not a toll-free number.)

Associated Claims Management 401(k) Plan (the Plan), Located in Walnut 
Creek, California

[Prohibited Transaction Exemption 96-28; Exemption Application No. D-
10121]

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 the sale of a group annuity contract (the GAC) 
issued by Mutual Benefit Life Insurance Company (Mutual Benefit) by the 
Plan to Foundation Health Corporation (FHC), a party in interest with 
respect to the Plan, provided that the following conditions are 
satisfied: (a) the sale is a one-time transaction for cash; (b) the 
Plan suffers no loss nor incurs any expense in connection with the 
sale; (c) the purchase price is no less than the fair market value of 
the GAC as of the date of the sale; and (d) any payments under the GAC 
to FHC, or its successors, after the date of the sale in excess of 
FHC's purchase price are paid to the Plan.
    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 February 13, 1996 at 61 
FR 5576.

FOR FURTHER INFORMATION CONTACT: Karin Weng of the Department, 
telephone (202) 219-8881. (This is not a toll-free number.)

[[Page 18161]]

Floral Glass and Mirror, Inc. Profit Sharing Plan and Trust (the Plan), 
Located in Hauppage, New York

[Prohibited Transaction Exemption 96-29; Exemption Application No. D-
10144]

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 the sale of 20 shares of stock of Floral Glass 
Industries, Inc. (FGI) by the Plan to Mr. Charles Kaplanek, Jr. 
(Kaplanek), a party in interest with respect to the Plan, provided the 
following conditions are satisfied: (a) The sale is a one-time 
transaction for cash; (b) the Plan pays no commissions or other 
expenses in connection with the transaction; (c) the Plan will receive 
the fair market value of the shares as determined by a qualified, 
independent appraiser; and (d) all terms and conditions of the sale 
will be at least as favorable to the Plan as those obtainable in an 
arm's-length transaction with an unrelated party at the time of the 
sale.
    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 March 5, 1996 at 61 FR 
8685.

FOR FURTHER INFORMATION CONTACT: Gary H. Lefkowitz 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 accurately describes all material terms of the transaction 
which is the subject of the exemption.

    Signed at Washington, DC, this 18th day of April, 1996.
Ivan Strasfeld,
Director of Exemption Determinations, Pension and Welfare Benefits 
Administration, U.S. Department of Labor.
[FR Doc. 96-10072 Filed 4-23-96; 8:45 am]
BILLING CODE 4510-29-P