[Federal Register Volume 60, Number 177 (Wednesday, September 13, 1995)]
[Notices]
[Pages 47608-47612]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-22752]



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DEPARTMENT OF LABOR
[Prohibited Transaction Exemption 95-81; Exemption Application Nos. D-
09511, D-09512 and D-09513, et al.]


Grant of Individual Exemptions; Bank of America Illinois, 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.

Bank of America Illinois, Located in Chicago, IL

[Prohibited Transaction Exemption 95-81 Exemption Application Nos. D-
09511, D-09512 and D-09513]

Exemption

Section I--Exemption for Purchases and Sales

    Effective September 1, 1993, the restrictions of section 
406(a)(1)(A) through (D) and section 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 to the purchase and sale by employee benefit plans (the Plans), 
to which the Bank serves as fiduciary, of shares in the Prime Fund, the 
Government Securities Fund, and the Treasury Fund, or each of their 
Pacific Horizon Fund successors, three open-end money market mutual 
fund portfolios (collectively referred to as the Funds), to which the 
Bank of America Illinois, and its affiliates (the Bank) provide 
investment advisory and other services, in connection with the 
Supplemental Sweep Service (as defined in paragraph (b) of section IV 
below), provided that the conditions of Section III are met.

Section II--Exemption for Receipt of Fees

    Effective September 1, 1993, the restrictions of section 
406(a)(1)(A) through (D) and section 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 to the receipt of fees by the Bank from the Funds for providing 
investment advisory and other services to the Funds, in connection with 
the investment of the assets of the Plans in the Funds, for which the 
Bank provides investment advisory and other services, provided that the 
conditions of Section III are met.

Section III--Conditions

    (a) The Bank does not have investment discretion or render 
investment advice (within the meaning of 29 CFR 2510.3-21(c)) with 
respect to the Plan assets invested in the Funds pursuant to this 
exemption.
    (b) No sales commissions or redemption fees are paid by the Plans 
in connection with the purchase or sale of shares in the Funds.
    (c) The Bank does not receive any fees payable pursuant to Rule 
12b-1 under the Investment Company Act of 1940 (the 12b-1 Fees) in 
connection with the transactions.
    (d) The price paid or received by a Plan for shares in a Fund is 
the net asset value per share on the date of the transaction, as 
defined in section IV(d), and is the same price which would have been 
paid or received for the shares by any other investor on that date.
    (e) Prior to the Bank's receipt of fees paid by each Fund with 
respect to Plan assets invested therein, each Plan receives a credit of 
such Plan's proportionate share of all fees charged to the Fund by the 
Bank.
    (f) The Plans are not employee benefit plans sponsored or 
maintained by the Bank.
    (g) A second fiduciary who is independent of and unrelated to the 
Bank or any of its affiliates (the Second Fiduciary), receives full 
written disclosure of information concerning the Fund(s), including but 
not limited to:
    (1) A current prospectus for each fund in which a Plan is 
considering investing;
    (2) A statement describing the fees for investment advisory or 
similar services, and all other fees to be charged to or paid by the 
Plan or the Funds, including the nature and extent of any differential 
between the rates of such fees;
    (3) The reason why the Bank may consider such investment to be 
appropriate for the Plan; and
    (4) Upon request of the Second fiduciary, a copy of the proposed 
exemption and/or a copy of the final exemption;
    (h) On the basis of the information described above in paragraph 
(g) of section III, the Second Fiduciary authorizes in writing the 
investment of assets of the Plan in each particular Fund, the fees to 
be paid by the Fund and the Plan to the Bank, and the credit to the 
Plan of fees received by the Bank 

[[Page 47609]]
from the Funds for investment advisory and other services, consistent 
with the responsibilities, obligations, and duties imposed on 
fiduciaries by part 4 of Title I of the Act.
    (i) The Second Fiduciary referred to in paragraph (g) of section 
III, or any successor thereto, is notified of any change in the rates 
of the fees referred to in paragraph (g) of section III and approves in 
writing the continued holding of any Fund shares acquired by the Plan 
prior to such change and still held by the Plan.
    (j) The Bank provides annually, written disclosures to the Second 
Fiduciary which are provided to all shareholders of the Fund(s), which 
establish the rate of return of the Fund(s) absent the credit paid to 
the Plans for fees paid by the Funds to the Bank.
    (k) The combined total of all fees received by the Bank for the 
provision of services to the Plans, and in connection with the 
provision of services to any of the Funds in which the Plans may 
invest, are not in excess of ``reasonable compensation'' within the 
meaning of section 408(b)(2) of the Act.
    (l) All dealings between the Plans and the Funds are on a basis no 
less favorable to the Plans than dealings between the Funds and other 
shareholders of the Funds.
    (m) The Bank shall maintain, for a period of six years, the records 
necessary to enable the persons described in paragraph (n) below to 
determine whether the conditions of this exemption have been met, 
except that (1) a prohibited transaction will not be considered to have 
occurred, if due to circumstances beyond the control of the Bank, the 
records are lost or destroyed prior to the end of the six year period, 
and (2) no party in interest other than the Bank shall be subject to 
the civil penalty that may be assessed under section 502(i) of the Act, 
or the taxes imposed by section 4975(a) and (b) of the Code, if the 
records are not available for examination as required by section (n) 
below;
    (n)(1) Except as provided in section (2) of this paragraph and 
notwithstanding any provisions of subsections (a)(2) and (b) of section 
504 of the Act, the records referred to in paragraph (l) above shall be 
unconditionally available at their customary location during normal 
business hours by:
    (A) Any duly authorized employee or representative of the 
Department or the Internal Revenue Service;
    (B) Any fiduciary of a Plan who has the authority to acquire or 
dispose of the interests of the Plan or any duly authorized 
representative of such fiduciary;
    (C) Any contributing employer to any Plan that has an interest in 
any of the Funds or any duly authorized employee or representative of 
such employer; and
    (D) Any participant or beneficiary of any Plan that has an interest 
in the Funds or any duly authorized representative of such participant 
or beneficiary.
    (2) None of the persons described in paragraphs (n)(1)(B) through 
(D) shall be authorized to examine the trade secrets of the Bank, or 
commercial or financial information which is privileged or 
confidential.

Section IV--Definitions

    For purposes of this proposed exemption:
    (a) Pacific Horizon Fund successor means each of the open-end money 
market mutual funds resulting from the merger of the Pacific Horizon 
Prime Fund and the Pacific Horizon Treasury Fund respectively with the 
Prime Fund and the Treasury Fund. In addition, Pacific Horizon Fund 
successor means the open-end money market mutual fund resulting from 
the merger of the Government Securities Fund with a similar money 
market mutual fund among the Pacific Horizon Funds.
    (b) Supplemental Sweep Service means the transfer of shares in the 
Funds between the Bank and the Plans by means of the Banks's internal 
accounting procedures at the end of the Supplemental Sweep Period, in 
connection with Plan orders to purchase shares in the Funds that the 
Bank is otherwise unable to settle prior to the Supplemental Sweep 
Period, and Plan orders to purchase or redeem shares in the Funds that 
are received by the Bank during the Supplemental Sweep Period. A Plan 
order to purchase or redeem shares in the Fund(s) pursuant to the 
Supplemental Sweep Service occurs solely as a result of investment 
decisions, deposits or withdrawals, directed by an independent Second 
Fiduciary.
    (c) Supplemental Sweep Period means the period of time on each 
business day after the Funds stop accepting orders for the purchase or 
redemption of shares in the Funds and before the Bank's close of 
business.
    (d) The term ``net asset value'' means the amount for purposes of 
pricing all purchase and sale of shares in the Funds calculated by 
dividing the value of all securities, determined by a method as set 
forth in the Fund's prospectus and statement of additional information, 
and other assets belonging to the Fund or portfolio of the Fund, less 
the liabilities charged to each such portfolio or fund, by the number 
of outstanding shares.
    (e) An ``affiliate'' of a person includes:
    (1) Any persons directly or indirectly through one or more 
intermediaries, controlling, controlled by, or under common control, 
with the person;
    (2) Any officer, director, employee, relative of, or partner in any 
such person; and
    (3) Any corporation or partnership of which such person is an 
officer, director, partner or employee.
    (f) The term ``control'' means the power to exercise a controlling 
influence over the management or policies of a person other than an 
individual.
    (g) The term ``relative'' means a ``relative'' as that term is 
defined in section 3(15) of the Act (or a ``member of the family'' as 
that term is defined in section 4975(e)(6) of the Code), or a brother, 
a sister, or a spouse of a brother or sister.
    (h) A fiduciary will not be deemed to be an independent fiduciary 
with respect to the Bank and its affiliates if:
    (1) The fiduciary directly or indirectly controls, is controlled 
by, or is under common control with the Bank or any affiliate:
    (2) The fiduciary, or any officer, director, partner, employee or 
relative of such fiduciary, is an officer, director partner, or 
employee of the Bank or any affiliate (or is a relative of such 
persons); or
    (3) The fiduciary directly or indirectly receives any compensation 
or other consideration for his or her own personal account in 
connection with any transaction described in this proposed exemption.
    If an officer, director, partner, or employee of the Bank (or a 
relative of such person), is a director of such Second Fiduciary, and 
if he or she abstains from participation in (i) the choice of the 
Plan's investment manager/adviser, (ii) the approval of any purchase or 
sale by the Plan of shares of the Funds, and (iii) the approval of any 
change of fees charged to or paid by the Plan, in connection with any 
of the transactions described in sections I and II above, then 
paragraph (h)(2) of section III above, shall not apply.
    The availability of this exemption is subject to the express 
condition that the material facts and representations contained in the 
application are true and complete, and that the application accurately 
describes all material facts which are the subject of this exemption. 

[[Page 47610]]


Written Comments

    In the Notice of Proposed Exemption (the Notice), the Department 
invited all interested persons to submit written comments and requests 
for a hearing on the proposed exemption within 30 days of the date of 
publication of the Notice in the Federal Register on April 7, 1995.
    During the comment period, the Department received no requests for 
a hearing. However, the Department received a comment letter and 
subsequent clarifications, dated May 18, August 2, and August 4, 1995 
from the Bank.
    First, the Bank states that item 8 of the Summary of Facts and 
Representations in the Notice indicates that the books of the Fund's 
transfer agent carry only one account for all purchases and redemptions 
of Fund shares by the Bank. The Bank represents that it is possible in 
the future that, solely for bookkeeping purposes, the transfer agent 
may record separate accounts in the Bank's name to reflect orders from 
different Bank departments or divisions, or for other purposes, such as 
reflecting the Bank's own provisional accounts. Nonetheless, all such 
shares would be held in the name of the Bank. The Department concurs.
    Second, the Bank notes a typographical error in the Federal 
Register at page 17812: the reference to the Bank's cash management fee 
reads ``12'' percent rather than ``0.12 percent.'' The Department 
concurs.
    Third, the Bank states that the Prime Fund and the Treasury Fund 
may be respectively merged into the Pacific Horizon Prime Fund and the 
Pacific Horizon Treasury Fund, which are money market mutual funds with 
respect to which a BAI affiliate serves as investment adviser. In 
addition, although the Government Securities Fund has not been used as 
a cash management vehicle for any plan to date, it may be merged into a 
similar money market mutual fund among the Pacific Horizon Funds which 
is also advised by a BAI affiliate. Further, the Bank represents that 
the prior representations regarding the Prime Fund, the Treasury Fund 
and the Government Securities Fund will remain accurate with respect to 
the Pacific Horizon Fund successors. In this regard, the Bank has 
requested that relief be extended to the Pacific Horizon Funds which 
succeed the Prime Fund, the Treasury Fund and the Government Securities 
Fund. The Department concurs.
    After giving full consideration to the record, including the 
comments by the Bank, the Department has determined to grant the 
exemption as described herein. In this regard, the comments submitted 
to the Department have been included as part of the public record of 
the exemption application. The complete application file, including all 
supplemental submissions received by the Department is made available 
for public inspection in the Public Documents Room of the Pension and 
Welfare Benefits Administration, Room N-5507, U.S. Department of Labor, 
200 Constitution Avenue N.W., Washington, D.C. 20210.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this exemption published 
refer to the notice of proposed exemption published Friday April 7, 
1995, at 60 FR 17809.

For Further Information Contact: Eric Berger of the Department, 
telephone (202) 219-8971 (This is not a toll-free number).
PMS Profit Sharing and Retirement Savings Plan and Trust (the Plan), 
Located in Cleveland, Ohio

[Prohibited Transaction Exemption 95-82; Exemption Application No. D-
09824]

Exemption

    The restrictions of sections 406(a), 406(b)(1) and (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 (the Sale) of a certain parcel of improved real 
property (the Property) from the Plan to M. A. Hanna Company (Hanna), a 
party in interest with respect to the Plan provided that the following 
conditions are met:
    (1) The fair market value of the Property is established by a 
qualified and independent real estate appraiser;
    (2) Hanna pays the greater of $990,800 or the current fair market 
value of the Property;
    (3) The Sale is a one time transaction for cash;
    (4) The Plan pays no fees or commissions related to the Sale; and
    (5) Hanna pays any excise taxes to the Internal Revenue Service 
owed pursuant to section 4975(a) of the Code resulting from Hanna's 
lease of the Property from the Plan through the effective date of the 
final grant of the exemption within 90 days of such date.
    Effective Date: This exemption will be effective as of September 1, 
1995.
    For a more complete statement of the facts and representations 
supporting this exemption, refer to the notice of proposed exemption 
published on July 12, 1995 at 60 FR 35941.
    Written Comments: With respect to the notice of proposed exemption, 
the Department received one comment in which the applicant requests 
that the exemption be effective September 1, 1995. The Department has 
modified the final exemption accordingly in response to the comment.
    For Further Information Contact: Allison Padams, of the Department, 
telephone (202) 219-8971. (This is not a toll-free number.)
Mercury Asset Management International Ltd. (Mercury International) 
Located in London, England

[Prohibited Transaction Exemption 95-83; Exemption Application No. D-
09998]

Exemption

    The restrictions of sections 406(a)(1)(A) 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) of the Code, shall not apply 
to the proposed cross-trading of securities between various accounts 
managed by Mercury International or its Affiliates (the Accounts) where 
at least one Account involved in any cross-trade is an employee benefit 
plan account (Plan Account) for which Mercury International acts as a 
fiduciary; provided that both the General Conditions of Section I and 
the Specific Conditions of Section II below are met.

Section I--General Conditions

    (a) Each employee benefit plan comprising a Plan Account 
participating in Mercury International's cross-trading program has 
total assets equal to at least $25 million. In the case of multiple 
employee benefit plans maintained by a single employer or controlled 
group of employers, the $25 million requirement may be met by 
aggregating the assets of such plans if the assets are commingled for 
investment purposes in a single master trust.
    (b) A Plan's participation in the cross-trade program is subject to 
a written authorization executed in advance by a qualified Plan 
Fiduciary which is independent of Mercury International and its 
Affiliates (the Independent Fiduciary).
    (c) The authorization referred to in paragraph (b) above is 
terminable at will without penalty to the Plan Account, upon receipt by 
Mercury International of written notice of termination.
    (d) Before an authorization is made for any Plan Account, the 
Independent Fiduciary is furnished with any reasonably available 
information necessary for the Independent Fiduciary 

[[Page 47611]]
to determine whether the authorization should be made, including (but 
not limited to) a copy of this exemption, an explanation of how the 
authorization may be terminated, a description of Mercury 
International's cross-trade practices, and any other reasonably 
available information regarding the matter that the Independent 
Fiduciary requests.
    (e) Each cross-trade transaction involves only equity or debt 
securities for which there is a generally recognized market. With 
respect to any non-U.S. securities, only those securities traded on a 
recognized foreign securities exchange for which market quotations are 
readily available shall be covered by the exemption.1

    \1\ With respect to all non-U.S. securities that are ``plan 
assets'' managed by Mercury International or an Affiliate, the 
applicant represents that the requirements of section 404(b) of the 
Act and the regulations thereunder will be met (see 29 CFR 
2550.404b-1). In this regard, section 404(b) of the Act states that 
no fiduciary may maintain the indicia of ownership of any assets of 
a plan outside the jurisdiction of the district courts of the United 
States, except as authorized by regulation by the Secretary of 
Labor. The Department is providing no opinion herein as to whether 
such requirements will be met.
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    (f) Each cross-trade transaction is effected at the current market 
value for the security on the date of the transactions. For equity 
securities, this shall be the closing price for the security on the 
date of the transaction. The ``closing price'' shall be the last trade 
price on exchanges where dealing is order-driven and the closing mid-
market price (i.e. the average of the closing bid and offer prices) 
where dealing is quote-driven. For debt securities, the current market 
value shall be the fair market value determined in accordance with 
paragraph (b) of Rule 17a-7 issued by the Securities and Exchange 
Commission under the Investment Company Act of 1940.
    (g) Neither Mercury International nor its Affiliates charges a Plan 
Account affected by a cross-trade transaction any fee or commission for 
such transaction.
    (h) At least every three months, and not later than 45 days 
following the period to which it relates, Mercury International 
furnishes the Independent Fiduciary with a report disclosing: (1) a 
list of all cross-trade transactions engaged in on behalf of the Plan 
Account, and (2) with respect to each cross-trade transaction, the 
prices at which the securities involved in the transaction were traded 
on the date of such transaction.
    (i) The Independent Fiduciary is furnished with a summary of 
certain additional information at least once per year. The summary must 
be furnished within 45 days after the end of the period to which it 
relates, and must contain the following: (1) a description of the total 
amount of the Plan Account's assets involved in cross-trade 
transactions during the period, (2) a description of Mercury 
International's cross-trade practices, if such practices have changed 
materially during the period covered by the summary, (3) a statement 
that the Independent Fiduciary's authorization of cross-trade 
transactions may be terminated upon receipt by Mercury International of 
written notice to that effect, and (4) a statement that the Independent 
Fiduciary's authorization of the Plan Account's participation in the 
cross-trade program will continue in effect unless it is terminated.
    (j) For all Accounts participating in the cross-trading program, if 
the number of shares of a particular security which any Accounts need 
to sell on a given day is less than the number of shares of such 
security which any Accounts need to buy, or vice versa, the direct 
cross-trade opportunity is allocated among the buying or selling 
Accounts on a pro rata basis.
    (k) The Accounts involved in cross-trade transactions do not 
include assets of any Plan established or maintained by Mercury 
International or its Affiliates.

Section II--Specific Conditions

    (a) An Independent Fiduciary of each Plan specifically authorizes 
each cross-trade transaction in accordance with the following 
procedure:
    (1) No more than three business days prior to the execution of any 
cross-trade transaction, Mercury International shall inform an 
Independent Fiduciary of each Plan Account involved in the cross-trade 
transaction that Mercury International proposes to buy or sell 
specified securities in a cross-trade transaction if an appropriate 
opportunity is available, the current trading price for such 
securities, and the total number of shares to be acquired or sold by 
each such Plan Account;
    (2) Prior to each cross-trade transaction, the transaction shall be 
authorized either orally or in writing by the Independent Fiduciary of 
each Plan Account involved in the cross-trade transaction;
    (3) If a cross-trade transaction is authorized orally by an 
Independent Fiduciary, Mercury International shall provide written 
confirmation of such authorization in a manner reasonably calculated to 
be received by such Independent Fiduciary within one business day from 
the date of such authorization;
    (4) The authorization referred to in this Section II shall be 
effective for a period of three business days; and
    (5) No more than ten days after the completion of a cross-trade 
transaction, the Independent Fiduciary shall be provided with a written 
confirmation of the transaction and the price at which the transaction 
was executed.
    (b) A cross-trade transaction is effected only where the 
transaction involves less than five (5) percent of the aggregate 
average daily trading volume for the securities involved in the 
transaction for the week immediately preceding the authorization of the 
transaction. A cross-trade transaction may exceed this limit only by 
express authorization of Independent Fiduciaries on behalf of Plan 
Accounts affected by the transaction, prior to the execution of the 
cross-trade.
    (c) The cross-trade transaction is effected at a price which is 
within ten (10) percent of the closing price of the security on the day 
before the date on which Mercury International received authorization 
by the Independent Fiduciary to engage in the cross-trade transaction.
Section III--Definitions

    For purposes of this exemption:
    (a) ``Account'' means a Plan Account or Non-Plan Account;
    (b) ``Affiliate'' means any person directly or indirectly through 
one or more intermediaries, controlling, controlled by, or under common 
control with Mercury International;
    (c) ``Buying Account'' means the Account which seeks to purchase 
securities in a cross-trade transaction;
    (d) ``Cross-trade transaction'' means a purchase and sale of 
securities between Accounts for which Mercury International or an 
Affiliate is acting as investment manager;
    (e) ``Plan Account'' means an Account managed by Mercury 
International consisting of assets of one or more employee benefit 
plans which are subject to the Act;
    (f) ``Non-Plan Account'' means an Account managed by Mercury 
International consisting of assets of clients which are not employee 
benefit plans subject to the Act; and
    (g) ``Selling Account'' means the Account which seeks to sell its 
securities in a cross-trade transaction.
    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 (the Proposal) published on June 15, 
1995, at 60 FR 31517.

[[Page 47612]]

    Written Comments and Modifications: The applicant submitted a 
comment letter on the Proposal to inform the Department regarding 
changes in the corporate structure of S.G. Warburg Group plc (the 
Warburg Group). In this regard, the Proposal was published for Warburg 
Investment Management International Ltd. (Warburg International) and 
its Affiliates.
    The applicant states that at the time of the Proposal, Warburg 
International was a wholly-owned subsidiary of Mercury Asset Management 
plc, which was a wholly-owned subsidiary of Mercury Asset Management 
Group plc (MAM Group). At such time, MAM Group was 75% owned by the 
Warburg Group and 25% owned by the public. MAM Group is a public 
company listed on the London Stock Exchange with its own independent 
board of directors.
    The applicant represents that on July 2, 1995, the investment 
banking business of the Warburg Group was acquired by Swiss Bank 
Corporation Investment Banking Ltd. (SBCI), a wholly-owned subsidiary 
of Swiss Banking Corporation. However, the applicant states that the 
MAM Group was not one of the companies within the Warburg Group that 
was acquired by SBCI. Following completion of the sale of the Warburg 
Group's investment banking business to SBCI, a reconstruction of the 
Warburg Group took place whereby MAM Group became an independent 
company and all of its shares became owned entirely by the public. The 
applicant states that the 75% holding of MAM Group owned by the Warburg 
Group was distributed to the current shareholders of the Warburg 
Group.2 As a result, the MAM Group became fully independent of the 
Warburg Group as of July 26, 1995.

    \2\ The details of transaction are described as follows: Under a 
Scheme of Arrangement (a form of reorganization under English law 
the terms of which are approved by an English court), the MAM Group 
allotted new ordinary shares, equivalent to the shares held by the 
Warburg Group, to the current ordinary and deferred shareholders of 
the Warburg Group on a pro rata basis. The 75% holding of ordinary 
MAM Group shares held by the Warburg Group was then converted to 
deferred MAM Group shares, which were purchased by the MAM Group and 
cancelled, as required under English law.
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    The applicant represents further that part of the terms of the sale 
of the Warburg Group's investment banking business to SBCI required 
that companies within the MAM Group can no longer trade under the 
``Warburg'' name. Therefore, on July 27, 1995, the name of ``Warburg 
Investment Management International Ltd'' was changed to ``Mercury 
Asset Management International, Ltd''. The applicant states that there 
have been no other changes in the MAM Group and its subsidiaries as a 
result of the reorganization.
    In response to the applicant's additional information, the 
Department has modified the Proposal by deleting references made to 
``Warburg International'' and has substituted therefor the name 
``Mercury International''. The Department notes that the exemption 
would apply only to Mercury International and its Affiliates, as 
defined in Section III(b), and not to any of the other companies 
formerly within the Warburg Group that were sold to SBCI.
    No other comments, and no requests for a hearing, were made on the 
Proposal.
    Accordingly, the Department has determined to grant the proposed 
exemption as modified.
    For Further Information Contact: Mr. E.F. Williams of the 
Department, telephone (202) 219-8194. (This is not a toll-free number.)
LEGENT Retirement Security Plan (the Plan) Located in Pittsburgh, PA

[Prohibited Transaction Exemption 95-84; Exemption Application No. D-
10015]

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 cash sale by the Plan of a limited partnership 
interest in BPT Union City Associates, Inc. (the BPT Interest) to 
LEGENT Corporation, a party in interest with respect to the Plan.
    This exemption is conditioned upon the following requirements: (1) 
all terms and conditions of the sale are at least as favorable to the 
Plan as those obtainable in an arm's length transaction with an 
unrelated party; (2) the sale is a one-time transaction for cash; (3) 
the Plan is not required to pay any commissions, costs or other 
expenses in connection with the sale; and (4) the Plan receives a sales 
price which is not less than the greater of: (a) The fair market value 
of the BPT Interest as determined by a qualified, independent 
appraiser, or (b) the total acquisition cost plus opportunity costs 
attributable to the BPT Interest.
    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 June 29, 1995 at 60 FR 
33870.
    For Further Information Contact: Ms. Jan D. Broady 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 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) 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 8th day of September 1995.
Ivan Strasfeld,
Director of Exemption Determinations, Pension and Welfare Benefits 
Administration, U.S. Department of Labor.
[FR Doc. 95-22752 Filed 9-12-95; 8:45 am]
BILLING CODE 4510-29-P