[Federal Register Volume 73, Number 50 (Thursday, March 13, 2008)]
[Notices]
[Pages 13581-13587]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-4982]


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DEPARTMENT OF LABOR

Employee Benefits Security Administration


Prohibited Transaction Exemptions; 2008-03, 2008-04, and 2008-05 
Grant of Individual Exemptions Involving; D-11343, Wellington 
Management Company, LLP (Wellington Management), PTE 2008-03; D-11389, 
GE Asset Management Incorporated, PTE 2008-04; and D-11421, Toeruna 
Widge IRA (the IRA), PTE 2008-05

AGENCY: Employee Benefits Security 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 
(ERISA or the Act) and/or the Internal Revenue Code of 1986 (the Code).
    A notice was published in the Federal Register of the pendency 
before the Department of a proposal to grant such exemption. The notice 
set forth a summary of facts and representations contained in the 
application for exemption and referred interested persons to the 
application for a complete statement of the facts and representations. 
The application has been available for public inspection at the 
Department in Washington, DC. The notice also invited interested 
persons to submit comments on the requested exemption to the 
Department. In addition the notice stated that any interested person 
might submit a written request that a public hearing be held (where 
appropriate). The applicant has represented that it has complied with 
the requirements of the notification to interested persons. No requests 
for a hearing were received by the Department. Public comments were 
received by the Department as described in the granted exemption.
    The notice of proposed exemption was issued and the exemption is 
being granted solely by the Department because, effective December 31, 
1978, section 102 of Reorganization Plan No. 4 of 1978, 5 U.S.C. App. 1 
(1996), 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

[[Page 13582]]

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 exemption is administratively feasible;
    (b) The exemption is in the interests of the plan and its 
participants and beneficiaries; and
    (c) The exemption is protective of the rights of the participants 
and beneficiaries of the plan.

Wellington Management Company, LLP (Wellington Management) and Its 
Subsidiaries (together, Wellington) Located in Boston, MA

[Prohibited Transaction Exemption 2008-03; Exemption Application No. D-
11343]

Exemption

Section I. Covered Transactions
    The restrictions of section 406(a)(1)(A) and (D) of the Act (or 
ERISA) and the sanctions resulting from the application of section 
4975(c)(1)(A) and (D) of the Code,\1\ shall not apply (1) 
retroactively, from January 1, 2001 through December 31, 2003, and (2) 
prospectively, from the date the notice granting the final exemption is 
published in the Federal Register, to--
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    \1\ For purposes of this exemption, references to provisions of 
Title I of the Act, unless otherwise specified, refer also to the 
corresponding provisions of the Code.
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    (A) The acquisition, from an offshore corporation (the Offshore 
Corporation) of certain non-voting equity securities (Shares), which 
represents interests in the economic value of the Offshore Corporation, 
by an ERISA-covered client plan (the Client Plan), where the Offshore 
is a party in interest with respect to the Client Plan, due to the 
ownership of all of the voting equity shares (Manager Shares) of the 
Offshore Corporation by Wellington Global Administrator, Ltd. 
(Wellington Global Administrator), a subsidiary of Wellington 
Management, which is (or may become) a fiduciary and a service provider 
with respect to the Client Plan; and
    (B) The redemption of the Client Plan's Shares by the Offshore 
Corporation either in cash or in kind.
Section II. Conditions
    This exemption is conditioned upon adherence to the material facts 
and representations described herein and upon satisfaction of the 
following conditions, which apply both retroactively and prospectively, 
unless otherwise excepted:
    (a) All decisions to acquire or redeem Shares have been made or are 
made on behalf of the Client Plan by an authorized fiduciary, which is 
independent of Wellington and the applicable Offshore Corporation.
    (b) At the time of acquisition of Shares from an Offshore 
Corporation, each Client Plan either had or has assets at least equal 
to $100 million.
    (1) In the case of a master trust that holds assets of multiple 
related Client Plans maintained by a single employer or a controlled 
group of employers, as defined in section 407(d)(7) of the Act, this 
requirement is satisfied if the master trust has aggregate assets at 
least equal to $100 million (assuming the fiduciary responsible for 
making the investment decision is the Client Plan sponsor or an 
affiliate of the Client Plan sponsor).
    (2) In the case of a pooled fund (e.g., a group trust) whose assets 
are ``plan assets'' subject to the Act, this requirement is satisfied 
as long as either (i) the pooled fund has at least $100 million in 
aggregate assets and the fiduciary making the investment decision is 
unrelated to Wellington and manages at least $200 million in assets 
(exclusive of the aggregate assets invested in the Offshore 
Corporations); or (ii) at least 50 percent of the units of beneficial 
interest in the pooled fund are held by Client Plans, each of which has 
total net assets of at least $100 million.
    (c) Wellington has not provided and does not provide investment 
advice (within the meaning of 29 CFR 2510.3-21(c)), nor is it a 
fiduciary with respect to any Client Plan's investment in an Offshore 
Fund.
    (d) All acquisitions and redemptions of Shares by a Client Plan 
have been made or are made for fair market value, determined as 
follows:
    (1) Equity securities have been valued or are valued at their last 
sale price or official closing price on the market on which such 
securities primarily trade using sources independent of Wellington and 
the issuer. If no sales occurred on such day, equity securities are 
valued at the last reported independent ``bid'' price or, if sold 
short, at the last reported independent ``asked'' price.
    (2) Fixed income securities have been valued or are valued on 
either the basis of ``firm quotes'' obtained at the time of the 
acquisition or redemption of Shares from U.S.-registered or foreign 
broker-dealers, which are registered and subject to the laws of their 
respective jurisdiction, which quotes reflect the share volume involved 
in the transaction, or on the basis of prices provided by independent 
pricing services that determine valuations based on market transactions 
for comparable securities and various relationships between such 
securities that are generally recognized by institutional traders.
    (3) Options have been valued or are valued at the mean between the 
current independent ``bid'' price and the current independent ``asked'' 
price or, where such prices are not available are valued at their fair 
value in accordance with Fair Value Pricing Practices by Wellington 
Management's pricing committee, which utilizes a set of defined rules 
and an independent review process.
    (4) If current market quotations are not readily available for any 
investments, such investments have been valued or will be valued at 
their fair value by Wellington Management's pricing committee in 
accordance with Fair Value Pricing Practices.
    (e) A Client Plan's Shares have been redeemed or may be redeemed, 
in whole or in part, without the payment of any redemption fee or other 
penalty, on a pre-specified, periodic (not longer than semi-annual) 
basis, upon no more than 45 days' advance notice, except for a one-year 
lock-up period imposed on new investors.
    (f) Redemptions of Shares in an Offshore Corporation by a Client 
Plan have been made or are made in cash unless:
    (1) A Client Plan consents to such in kind redemption; or
    (2) Wellington requires that such redemption be made in kind on a 
pro rata basis to protect the best interests of the Offshore Fund and 
the remaining investors, including other Client Plan investors.
    (g) In advance of the initial investment by a Client Plan in an 
Offshore Corporation's Shares, the independent fiduciary of a Client 
Plan has received or receives--
    (1) A copy of the proposed exemption and the final exemption, 
following the publication of these documents in the Federal Register. 
(This disclosure provision applies to the prospective exemptive relief 
described herein.)
    (2) An offering memorandum describing the relevant Offshore 
Fund(s), as well as the relevant investment objectives, fees and 
expenses and redemption and valuation procedures; and
    (3) All reasonably available relevant information as such 
independent fiduciary may request.
    (h) On an ongoing basis, Wellington has provided or provides a 
Client Plan with the following information:
    (1) Unaudited performance reports at the end of each month;

[[Page 13583]]

    (2) Audited annual financial statements and access to a protected 
internet site; and
    (3) Client services group assistance for any investor inquiries.
    (i) No commission or sales charge has been assessed or is assessed 
against the Client Plan in connection with its acquisition of an 
Offshore Corporation's Shares.
    (j) Not more than 10% of the assets of the Client Plan has been 
invested or is invested, in the aggregate, in Shares of all Offshore 
Corporations (determined at the time of any acquisition of such Shares) 
and not more than 5% of the assets of the Client Plan has been 
indirectly invested or is invested, in the aggregate, in any one 
offshore fund (the Offshore Fund), a separate collective investment 
vehicle underlying an Offshore Corporation, (also determined at the 
time of any acquisition of an interest in such Offshore Fund by such 
Client Plan).
    (k) For prospective transactions only (and following the 
publication of the proposed exemption and the final exemption in the 
Federal Register), each Offshore Corporation, each Offshore Fund, 
Wellington Management Investment, Inc., Wellington Global Holdings, 
Ltd., Wellington Hedge Management, LLC, and Wellington Global 
Administrator--
    (1) Has agreed to submit to the jurisdiction of the federal and 
state courts located in the Commonwealth of Massachusetts;
    (2) Has agreed to appoint an agent for service of process in the 
United States, which may be an affiliate (the Process Agent);
    (3) Has consented to service of process on the Process Agent; and
    (4) Has agreed that any enforcement by a Plan of its rights 
pursuant to this exemption will, at the option of the Plan, occur 
exclusively in the United States courts.
    (l) For prospective transactions only (and following the 
publication of the proposed exemption and the final exemption in the 
Federal Register), Wellington maintains in the United States for a 
period of six years from the date of the covered transactions, such 
records as are necessary to enable the persons described in paragraph 
(m) of this section II to determine whether the conditions of this 
exemption were met, except that:
    (1) If the records necessary to enable the persons described in 
paragraph (m) to determine whether the conditions of the exemption have 
been met are lost or destroyed, due to circumstances beyond the control 
of Wellington, then no prohibited transaction will be considered to 
have occurred solely on the basis of the unavailability of those 
records; and
    (2) No party in interest other than Wellington shall be subject to 
the civil penalty that may be assessed under section 502(i) of the Act 
or to the taxes imposed by section 4975(a) and (b) of the Code if the 
records have not been maintained or are not available for examination 
as required by paragraph (m) below.
    (m)(1) Except as provided in paragraph (m)(2) of this section II 
and notwithstanding the provisions of subsections (a)(2) and (b) of 
section 504 of the Act, the records referred to above in paragraph (l) 
of this section II are unconditionally available for examination during 
normal business hours at their customary location to the following 
persons or an authorized representative thereof:
    (i) Any duly authorized employee or representative of the 
Department or the Internal Revenue Service (the Service);
    (ii) Any fiduciary of a Client Plan; or
    (iii) Any participant or beneficiary of a Client Plan or any duly 
authorized employee or representative of such participant or 
beneficiary.
    (2) None of the persons described above in paragraphs (ii) and 
(iii) of this paragraph (m)(1)(ii) and (iii) of this Section II shall 
be authorized to examine trade secrets of Wellington, or any commercial 
or financial information, which is privileged or confidential.
Section III. Definitions
    (a) The term ``Wellington'' means Wellington Management Company, 
LLP and its subsidiaries.
    (b) An ``affiliate'' of Wellington means--
    (1) Any person directly or indirectly through one or more 
intermediaries, controlling, controlled by, or under common control 
with the person;
    (2) Any officer, director, employee, relative, or partner in any 
such person; and
    (3) Any corporation or partnership of which such person is an 
officer, director, partner, or employee.
    (c) The term ``control'' means the power to exercise a controlling 
influence over the management or policies of a person other than an 
individual.
    (d) The term ``Offshore Corporation'' means --
    (1) WMIB;
    (2) Any future expansion of WMIB that includes an additional class 
of securities or an additional Offshore Fund that is organized as a 
Bermuda limited partnership, which corresponds to the new WMIB class 
that is established by Wellington pursuant to the WMIB structure, and 
conforms to the same conditions, rules and regulations described in 
this exemption;
    (3) Archipelago; or
    (4) Any future ``fund of funds'' investment vehicle that is formed 
by Wellington under Bermuda law and is set up in substantially the same 
manner as Archipelago, with the same management structure, and conforms 
to the same conditions, rules and regulations described in this 
exemption.
    (e) The term ``Offshore Fund'' means a collective investment 
vehicle that is organized as a Bermuda limited partnership, which 
corresponds to each class of WMIB securities. Each Offshore Fund 
invests primarily in publicly-traded securities, although up to 15% of 
each Offshore Fund may be invested in securities that are not readily 
marketable.
    (f) The term ``U.S. broker-dealer'' means a broker-dealer 
registered in the United States under the Securities Exchange Act of 
1934 (the 1934 Act) or exempted from registration under section 
15(a)(1) of the 1934 Act as a dealer in exempted government securities 
(as defined in section 3(a)(12) of the 1934 Act).
    (g) The term ``foreign broker-dealer'' means a broker that has, as 
of the last day of its most recent fiscal year, equity capital that is 
the equivalent of not less than $200 million and is registered and 
regulated, under the relevant securities laws of a governmental entity 
of a country other than the United States, where such regulation and 
oversight by the governmental entities is comparable to regulatory 
regimes within the United States.
    (h) ``Manager Shares'' refer to the equity securities of an 
Offshore Corporation that have voting rights and control the election 
of the Board of Directors of an Offshore Corporation. Manager Shares do 
not participate in the economic performance of the Offshore Corporation 
and are owned 100% by Wellington Global Administrator.
    (i) ``Shares'' refer to the equity securities of an Offshore 
Corporation that do not have voting rights. Such shares represent 
substantially all of the economic value of the Offshore Corporation and 
are or will be directly linked either (i) by class to a corresponding 
Offshore Fund (in the case of WMIB) or (ii) to a mix of various WMIB 
classes (in the case of Archipelago or any other fund of funds entity).
    Effective Date: This exemption is effective retroactively for the 
transactions involving Wellington and

[[Page 13584]]

two Client Plans that occurred from January 1, 2001 until December 31, 
2003. For prospective transactions involving Wellington and a Client 
Plan, this exemption is effective on the date the notice granting the 
final exemption is published in the Federal Register.

Written Comments

    The Department invited all interested persons to submit written 
comments with respect to the notice of proposed exemption (the Notice) 
within 45 days of the date of the publication of such notice in the 
Federal Register on October 26, 2007. All comments were due by December 
10, 2007.
    During the comment period, the Department received one written 
comment concerning the Notice. The comment was submitted by Wellington 
and it requests certain modifications or clarifications to the Notice 
in the areas discussed below.
    1. Footnote 3. In Footnote 3 of the Summary of Representations, the 
last sentence states that, ``[b]ecause these two WMIB classes are not 
Offshore Funds, as defined in this proposed exemption, no plans will be 
permitted to invest in these WMIB classes.'' Wellington represents that 
this statement is overly-broad in that ERISA-covered plans can invest 
in these classes as long as such investment does not constitute a 
prohibited transaction either because the Offshore Fund is not a party 
in interest or because there is an alternative exemption available. 
Accordingly, Wellington requests that the last sentence in Footnote 3 
be limited to situations in which the investment is made ``pursuant to 
this exemption.'' In addition, Wellington requests that the Department 
clarify by adding the words ``pursuant to this exemption'' to such 
footnote so that the sentence will only apply when this exemption is 
being utilized.
    In response to this comment, the Department has noted Wellington's 
clarification to Footnote 3 of the Summary of Facts and 
Representations.
    2. Representation 5. Representation 5 of the Summary of Facts and 
Representations contains a detailed discussion of the fact that the 
Offshore Corporations are not ``highly leveraged'' relative to the 
universe of hedge funds. Although Wellington agrees with this factual 
statement, as a general matter, Wellington states that certain of the 
details included in Representation 5 and accompanying Footnote 6 are 
not entirely accurate because they are based on historical facts rather 
than future events. For example, Wellington explains that Footnote 6 
states that the long exposure number for the WMIB and Archipelago class 
funds ``never exceeds 150%.'' While this statement was historically 
true at the time Wellington submitted the information, it was intended 
to be factual evidence supporting the general proposition that these 
funds are not highly leveraged, not a representation that this 
percentage would never exceed 150%. Accordingly, Wellington states that 
the details of Representation 6 are intended to reflect the specific 
historical information submitted by Wellington and are subject to 
change over time as long as the Offshore Corporations remain not highly 
leveraged on a relative basis. Also, on a related point, to be 
consistent with its submissions, Wellington indicates that the word 
``generally'' should be inserted immediately before the word 
``subject'' in the third line, and immediately before the word 
``limited'' in the eighth line, of the second paragraph of 
Representation 5.
    In response to this comment, the Department acknowledges 
Wellington's clarifications to Representation 5 of the Summary of Facts 
and Representations.
    3. Representation 6. The last sentence of the first paragraph of 
Representation 6 of the Summary of Facts and Representations states 
that no Client Plans are currently invested in Shares. Wellington 
represents that this statement is not entirely accurate because a 
Client Plan may have acquired shares in reliance on PTE 96-23 (61 FR 
15975, April 10, 1996), the class exemption for In-House Asset Managers 
or another exemption. In any event, Wellington explains that this 
statement is not material. Accordingly, Wellington requests that the 
words ``but not by any Client Plans'' be deleted from Representation 6.
    In response to this comment, the Department notes this 
clarification to Representation 6 of the Summary of Facts and 
Representations.
    4. Representation 8. The last sentence of Representation 8 of the 
Summary of Facts and Representations states that various offshore 
Wellington affiliates will consent to the jurisdiction of certain U.S. 
courts and appoint Wellington as their agent for service of process. 
Wellington wishes to clarify that this will occur when a Client Plan 
invests in an Offshore Corporation pursuant to this exemption.
    In response to this comment, the Department notes Wellington's 
clarification to Representation 8 of the Summary of Facts and 
Representations.
    5. Representation 11. In the Summary of Facts and Representations, 
the fourth sentence of the first paragraph of Representation 11 (and a 
similar reference in the third parargraph of this representation) 
states that Wellington Global Administrator provides services to Client 
Plans. Wellington points out that this entity provides services to the 
Offshore Funds and the Offshore Corporations, which are not plan asset 
vehicles. Accordingly, Wellington explains that Wellington Management 
would not be considered a party in the interest by reason of its 
ownership of Wellington Global Administrator. However, Wellington 
explains that Wellington Management is (or may become) a party in the 
interest with respect to the Client Plans by reason of its being a 
service provider to such plans. In this regard, Wellington states that 
Wellington Global Administrator would be a party in interest because it 
is a corporation that is more than fifty percent owned by Wellington 
Management, itself a fiduciary and service provider.
    In response to this comment, the Department acknowledges 
Wellington's modification to Representation 11 of the Summary of Facts 
and Representations.
    6. Representation 13. The last sentence of Representation 13 of the 
Summary of Facts and Representations, states that no more than five 
percent of the securities that are not readily marketable will be 
subject to Wellington's fair value pricing practices. Wellington 
explains that this statement is incorrect in several respects. First, 
Wellington indicates in its submission that not more than five percent 
of the aggregate securities held by the Offshore Fund had been subject 
to its fair value pricing practices. Second, Wellington explains that 
this statement had been submitted as a historical fact rather than a 
representation as to future events. Wellington further explains that 
the first paragraph of Representation 2 of the Summary of Facts and 
Representations correctly states that not more than 15% of the assets 
of any Offshore Fund may be invested in securities that are not readily 
marketable.
    In response to this comment, the Department notes Wellington's 
clarification to Representation 13 of the Summary of Facts and 
Representations.
    Accordingly, after giving full consideration to the entire record, 
including the comment, the Department has determined to grant the 
exemption as modified or clarified above. For further information 
regarding the comment and other matters discussed herein, interested 
persons are encouraged to obtain copies of the exemption application 
file (Exemption Application No. D-11343) the Department is maintaining 
in this case. The complete application file, as well as the comment and 
all supplemental

[[Page 13585]]

submissions received by the Department, are made available for public 
inspection in the Public Disclosure Room of the Employee Benefits 
Security Administration, Room N-1513, U.S. Department of Labor, 200 
Constitution Avenue, NW., Washington, DC 20210.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this exemption, refer to 
the Notice published on October 26, 2007 at 72 FR 60891.

FOR FURTHER INFORMATION CONTACT: Ms. Jan D. Broady of the Department, 
telephone (202) 693-8556. (This is not a toll-free number.)

GE Asset Management Incorporated Located in Stamford, Connecticut

[Prohibited Transaction Exemption 2008-04; Exemption Application No. D-
11389]

Exemption

Section I--Exemption for In-Kind Redemption of Assets
    The restrictions in 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,\2\ effective March 1, 2006, to 
certain in-kind redemptions (the Redemption(s)), by plans sponsored by 
the General Electric Company (GE) or an affiliate (the Plan(s)), of 
shares (the Shares) of certain proprietary mutual funds for which GE 
Asset Management Incorporated (GEAM) provides investment advisory and 
other services (the Mutual Fund(s)), provided that the following 
conditions are satisfied:
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    \2\ For purposes of this exemption, references to specific 
provisions of Title I of the Act, unless otherwise specified, refer 
also to the corresponding provisions of the Code.
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    (A) The Plan pays no sales commissions, redemption fees, or other 
similar fees in connection with the Redemption (other than customary 
transfer charges paid to parties other than GEAM and any affiliates 
thereof (GEAM Affiliates));
    (B) The assets transferred to the Plan pursuant to the Redemption 
consist entirely of cash and Transferable Securities, as such term is 
defined in section II, below;
    (C) With certain exceptions described below, the Plan receives in 
any Redemption its pro rata portion of the securities that, when added 
to the cash received, is equal in value to the number of Shares 
redeemed, as determined in a single valuation performed in the same 
manner and as of 4 p.m. (local time for the New York Stock Exchange) on 
the same day, in accordance with Rule 2a-4 under the Investment Company 
Act of 1940, as amended (the 1940 Act), and the then-existing 
procedures established by the Board of Trustees of the Mutual Fund 
(using sources independent of GEAM and GEAM Affiliates). 
Notwithstanding the foregoing, Transferable Securities that are odd lot 
securities, fractional shares, and accruals on such securities may be 
distributed in cash;
    (D) Neither GEAM, nor any affiliate thereof, receives any direct or 
indirect compensation, or any fees, including any fees payable pursuant 
to Rule 12b-1 under the 1940 Act, in connection with any Redemption of 
the Shares;
    (E) Prior to a Redemption, GEAM provides in writing to an 
independent fiduciary, as such term is defined in section II 
(Independent Fiduciary), a full and detailed written disclosure of 
information regarding the Redemption;
    (F) Prior to a Redemption, the Independent Fiduciary provides 
written authorization for such Redemption to GEAM, such authorization 
being terminable at any time prior to the date of Redemption without 
penalty to the Plan;
    (G) Before authorizing a Redemption, based on the disclosures 
provided by GEAM to the Independent Fiduciary, the Independent 
Fiduciary determines that the terms of the Redemption are fair to the 
Plan, and comparable to, and no less favorable than, terms obtainable 
at arm's length between unaffiliated parties, and that the Redemption 
is in the best interests of the Plan and its participants and 
beneficiaries;
    (H) Not later than thirty (30) business days after the completion 
of a Redemption, the Mutual Fund will provide to the Independent 
Fiduciary a written confirmation regarding such Redemption containing:
    (i) The total number of Shares of the Mutual Fund and the 
percentage held by the Plan immediately before the Redemption (and the 
related per Share net asset value and the total dollar value of the 
Shares held);
    (ii) The identity (and related aggregate dollar value) of each 
security provided to the Plan pursuant to the Redemption, including 
each security valued in accordance with Rule 2a-4 under the 1940 Act 
and the then-existing procedures established by the Board of Trustees 
of the Mutual Fund (using sources independent of GEAM and GEAM 
Affiliates);
    (iii) The current market price of each security received by the 
Plan pursuant to the Redemption; and
    (iv) The identity of each pricing service or market-maker consulted 
in determining the value of such securities;
    (I) The value of the securities received by the Plan for each 
redeemed Share, when added to the cash received, equals the net asset 
value of such Share at the time of the transaction, and such value 
equals the value that would have been received by any other investor 
for shares of the same class of the Mutual Fund at that time;
    (J) Subsequent to a Redemption, within 180 days of the date of such 
Redemption, the Independent Fiduciary performs a post-transaction 
review that will include, among other things, testing a sampling of 
material aspects of the Redemption deemed in its judgment to be 
representative, including pricing;
    (K) Each of the Plan's dealings with the Mutual Funds, the 
investment advisers to the Mutual Funds, the principal underwriter for 
the Mutual Funds, or any affiliated person thereof, are on a basis no 
less favorable to the Plan than dealings between the Mutual Funds and 
other shareholders holding shares of the same class as the Shares;
    (L) GEAM will maintain, or cause to be maintained, for a period of 
six years from the date of any covered transaction such records as are 
necessary to enable the persons described in paragraph (M) below to 
determine whether the conditions of this exemption have been met, 
except that (i) this record-keeping condition shall not be violated if, 
due to circumstances beyond the control of GEAM, the records are lost 
or destroyed prior to the end of the six year period, (ii) no party in 
interest with respect to the Plan other than GEAM shall be subject to 
the civil penalty that may be assessed under section 502(i) of the Act 
or to the taxes imposed by section 4975(a) and (b) of the Code, if such 
records are not maintained or are not available for examination as 
required by paragraph (M) below;
    (M) (1) Except as provided in subparagraph (2) of this paragraph 
(M), and notwithstanding any provisions of section 504(a)(2) and (b) of 
the Act, the records referred to in paragraph (L) above are 
unconditionally available at their customary locations for examination 
during normal business hours by (i) any duly authorized employee or 
representative of the Department of Labor, the Internal Revenue 
Service, or the Securities and Exchange Commission, (ii) any fiduciary 
of the Plan or any duly authorized representative of such fiduciary, 
(iii) any participant, beneficiary, or union employee covered by the 
Plan or duly authorized representative of such participant, 
beneficiary, or union

[[Page 13586]]

employee, (iv) any employer whose employees are covered by Plan and any 
employee organization whose members are covered by such Plan.
    (2) None of the persons described in paragraphs (M)(1)(ii), (iii) 
and (iv) shall be authorized to examine trade secrets of GEAM or the 
Mutual Funds, or commercial or financial information that is privileged 
or confidential; and
    (3) Should GEAM or the Mutual Funds refuse to disclose information 
on the basis that such information is exempt from disclosure pursuant 
to paragraph (2) above, GEAM shall, by the close of the thirtieth 
(30th) day following the request, provide a written notice advising 
that person of the reasons for the refusal and that the Department may 
request such information.
Section II--Definitions
    (A) The term ``affiliate'' means:
    (1) Any person (including a corporation or partnership) directly or 
indirectly through one or more intermediaries, controlling, controlled 
by, or under common control with the person;
    (2) Any officer, director, employee, relative, or partner in any 
such person; and
    (3) Any corporation or partnership of which such person is an 
officer, director, partner, or employee.
    (B) The term ``control'' means the power to exercise a controlling 
influence over the management or policies of a person other than an 
individual.
    (C) The term ``net asset value'' means the amount for purposes of 
pricing all purchases and sales calculated by dividing the value of all 
securities, determined by a method as set forth in the Mutual Fund's 
prospectus and statement of additional information, and other assets 
belonging to the Mutual Fund, less the liabilities charged to each such 
Mutual Fund, by the number of outstanding shares.
    (D) The term ``Independent Fiduciary'' means a fiduciary who is: 
(i) Independent of and unrelated to GEAM and its affiliates, and (ii) 
appointed to act on behalf of the Plan with respect to the in-kind 
transfer of assets from one or more Mutual Funds to, or for the benefit 
of, the Plan. For purposes of this exemption, a fiduciary will not be 
deemed to be independent of and unrelated to GEAM if: (i) Such 
fiduciary directly or indirectly controls, is controlled by, or is 
under common control with GEAM, (ii) such fiduciary directly or 
indirectly receives any compensation or other consideration in 
connection with any transaction described in this exemption (except 
that an independent fiduciary may receive compensation from GEAM in 
connection with the transactions contemplated herein if the amount or 
payment of such compensation is not contingent upon or in any way 
affected by the independent fiduciary's ultimate decision), and (iii) 
an amount equal to more than two percent (2%) of such fiduciary's gross 
income, for federal income tax purposes, in its prior tax year, will be 
paid to such fiduciary by GEAM and its affiliates in such fiduciary's 
current tax year.
    (E) The term ``Transferable Securities'' means securities that are 
traded on public securities markets or for which quoted bid and asked 
prices are available from persons independent of GEAM and would not 
include the following types of securities or assets: (a) Securities 
that would have to be registered under the Securities Act of 1933, as 
amended; (b) securities issued by entities in countries that restrict 
the holdings of securities by non-nationals, including investment 
vehicles such as the Mutual Funds, or otherwise limit the ability to 
transfer the security other than through a local securities exchange 
transaction; and (c) certain portfolio assets (such as forward currency 
contracts, futures and option contracts, swap transactions, and 
repurchase agreements) that, although they may be liquid and 
marketable, involve the assumption of contractual obligations, require 
special trading facilities, or may be traded only with the counterparty 
to the transactions in order to effect a change in beneficial 
ownership.
    (F) The term ``relative'' means a ``relative'' as such term is 
defined in section 3(15) of the Act (or a ``member of the family,'' as 
such term is defined in section 4975(e)(6) of the Code), or a brother, 
sister, or a spouse of a brother or a sister.
    Effective Date: This exemption is effective as of March 1, 2006.
    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 October 26, 2007 at 72 FR 
60899.

FOR FURTHER INFORMATION CONTACT: Ms. Karin Weng of the Department, 
telephone (202) 693-8557. (This is not a toll-free number.)

Toeruna Widge IRA (the IRA)

Located in Mertztown, Pennsylvania Prohibited Transaction Exemption 
2008-05; Exemption Application No. D-11421

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 (the Sale) of approximately 59.99 acres of 
unimproved real property located at Fredericksville Road and Sweitzer 
Road, Rockland Township, Berks County, Pennsylvania (the Property) by 
the IRA to Dr. Toeruna Widge (the Applicant), a disqualified person 
with respect to the IRA,\3\ provided that the following conditions are 
satisfied:
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    \3\ Pursuant to 29 CFR 2510.3-2(d), the IRA is not within the 
jurisdiction of Title I of the Employee Retirement Income Security 
Act of 1974 (the Act). However, there is jurisdiction under Title II 
of the Act pursuant to section 4975 of the Code.
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    (A) All terms and conditions of the Sale are at least as favorable 
to the IRA as those which the IRA could obtain in an arm's-length 
transaction with an unrelated party;
    (B) The Sales price will be the greater of $390,000 or the fair 
market value of the Property as of the date of the Sale;
    (C) The fair market value of the Property has been determined by a 
qualified, independent appraiser;
    (D) The Sale is a one-time transaction for cash; and
    (E) The IRA will not pay any commissions, costs or other expenses 
in connection with the Sale.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this exemption, refer to 
notice of proposed exemption published on January 17, 2008 at 73 FR 
3281.

FOR FURTHER INFORMATION CONTACT: Anh-Viet Ly of the Department, 
telephone (202) 693-8648 (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

[[Page 13587]]

operate for the exclusive benefit of the employees of the employer 
maintaining the plan and their beneficiaries;
    (2) This exemption is 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 this exemption is subject to the express 
condition that the material facts and representations contained in the 
application accurately describes all material terms of the transaction 
which is the subject of the exemption.

    Signed at Washington, DC this 7th day of March 2008.
Ivan Strasfeld,
Director of Exemption Determinations, Employee Benefits Security 
Administration, U.S. Department of Labor.
 [FR Doc. E8-4982 Filed 3-12-08; 8:45 am]
BILLING CODE 4510-29-P