SHUMAKER LOOP

//

SHUMAKER LOOP

NORTH COURTHOUSE

SQUARE

1000

ALN

LOOP

GALLAGHER

ACeEPT

GOSUNE

MALCOLM

RAMEY

JOHN

I.4ACIETT

JR

THOMAS

WEBB

ALEXANDER

GREGORY

CARL

BRUGGEMAN

ROBERT

CLAYTON JR

MARC GERTNER

GEORGE

PICKNELL

DONALD

MEWI4ORT JR

EDWIN

EMEREON

JAMES

TUSCHMAN

JAMES

WHITE JR

BARTON

WAGENMAN

FRANcIs

.1

ROt.F

SCHEIDEL

JOHN

HAYWARD

WIWAM

TOLEDO

OHIO

43624

OWIO

24142Ot

419

WILLIAM

HEYW000

Il

MCDANIEL

JR

FOLI

JOSEPH

RIDEOUT

GEORGE

LCHAPMAN

WITHEREU

GRAHAM

BARRON

DENNIS

KEVIN

S.­

JOHN

.\

t-

\\J

AtL

SECURITIES

October

_.jCKG.FYNES

McCARTHY

TI4OTHY

-RINEE

--

BIPNBALJKI

AM BONINI

83

2-7

ANN LA.NZINGER

KR.HIGH

TN

jQQ

rsr

LJJ

HAEI

ELLEN

APL1

OF

OFFI.E

REOBTS

THOMAS

PLETZ

JOHN

BURSON

THOMAS

WEBB JR

ROBERT

AI%IACH

DAVID

WICKLUNO

GARY

DIESNG

JOHN

MaAY

HAEL

SANOERSON

N.SALES

MS

GOSLINE

HARTSEL

WATERMAN

VIVIAN

0I%

NORMAN

FRANCiS

KjMDRICK

JACXS6

McGOWAN

PISANELLJ

03 SQUILLANTE

GORYtLOOGE

SE1IVICES

ASL.W000MAN

GREGORY

SrSIBLEY

.1

OF

COUNSEL

CHARLES SCHARFY

CORWIN

SWIFT

JOHN

Office

of

Division

Chief

of

Securities

STRAUB

Counsel

Corporation Finance

Commission

Exchange

and

450 5th Street

N.W

D.C

20549

Washington

Re

for

Request

Ohio

Section

Sections

Act

Section

NoAction

and

of

the

3a2

3a4

of

and

Ladies

No

"puncil

Securities

1933

Exchange

Rule

1934

and

12h1a

3c11

of

of

the

the

Securities

Investment

Company

1940

of

the

Advisers

Investment

Act

of

1940

N1575/16191

Northwestern Ohio Building and Construction Trades

Council

is

confederation

of

local

building and__construction

whic reprisent

unions

in

northwestern

Ohio

working

members of the AFLCIO

Building

tLades

Ohio

Council

confederation

industry

of

the

Gentlemen

and

The

the

File

Act

of

of

202a11

Section

Our

Securities

3a5

and

Act

3c5

of

Relating to The Northwestern

Construction Trades Foundation

1934

12h

Exchange

Sections

Act

Letter

Building

in

the

anE

buiIg

The

local

lotion

unions

are

The

Department

of

Construction

Employers

the

Emplo

and

of

in

the

buil

employers

engaged

ng

same

tradesmen

affiliates

Trades

of

Northwestern

is

construction

geographic area

The

Council

and

the Employers

on behalf of the local

unions

associations within their respective groups

employers

desire

to

establish

construction industry

investment

program

the

ns

which

or

their

pyee pension benefi

they

and

foee4toL.

cosponsor

collec

Plans

Our

firm

has

been

retained

as

of

Office

Division

Securities

October

Counsel

Chief

of

Corporation Finance

and Exchange

Commission

27

1983

Page

counsel

special

establishing

and

the

will

be

to

Employers

assist

in

program

brief

In

Council

the

by

the

foundation

established

to

pursuant

want

to

in

the

participate

of

the

foundations

organizational

agreement is

attached

Exhibit

this

The

foundation

will

be

as

to

letter

administered by

The

will be directed to

gsxd pf Tzustees

trustees

establish

an

investment

allow

to

the

Plans

to

invest

in

plan

amElans wo

written

agreement

foundation

draft

mortgage loans

northwestern

Ohio

construction

period

The

foundation

will contact

institutions

in

to

learn

the

in mortgage loans

Each

individual

participations

Plans

member

in

participate

This

decision

tabulate

ag

be

the

ate

will

sed

esta

for

will

The

the

extent

to

the

the

of

participation

which

will

inst

lending

to

its

foundation

Aseparate

nv

to

the

trust

will

this

Plans

and

institutions

lending

in participating

in

mortgage

as

merely

communicate

can

loans

We

that

advise

us that

the

Staff

of

respectfully request

you

Securities

and

Commission

will

not

the

Commission

Exchange

recommend

is

the

mutual interest

indicate

the

endjig

which

through

inform

Plans

will

transaction

The

Plans

participating in

trust with the foundation

acting as

of

the

trust

to

agreement is attached as Exhibit

Plans

will transfer th

yes

to the lending

institution

The

foundation

un

eac

which will forward

to

the

establish

draft

letter

conduit

and

ich

lending

availability of

information

along to its

determine

whether

to

this

pass

Plan

proposed loan and

be

communicated

responses

amount

mortgage

trustee

this

the

and

of

that

organized

Commission take

the

and

in

operated

without

individualrusts

the

investment

as

of

3c5

Sections

Company

Act

trusts

as

without

Securities

of

the

set

forth

in

registering

under

1933

Section

without

trusts

as

this

if

the

letter

fudaUon

the

under

the

Investm

the

fro

exclusions

fojn

set

company

the

anIjjIJTflTiYof

Inystmeitnt

securities

Act

in

companies

the

upon

action

an -invest

exemption from

upon

T194O

ance

forth

the

registering

re

Ct

t1efinirion

set

mariner

Act

Company

enforcement

any

the

the

3a2

the

interests

in

the

21

of

the

Section

1933

Act in reliance

registration provisions

of

the

1933

Act

registering the interests

under

Section

12g

securities

in

the

of

the

program

Office

of

Counsel

Corporation Finance

and Exchange

Commission

Chief

of

Division

Securities

27

October

1983

Page

Securities

the

section

that

Rule

or

the

registration provisions

under that act

adopted

in

reliance

of

broker

without

trusts

3a5

as

an

upon

and

dealer

of

as

the

set

forth

Act

1934

202a11

the

DESCRIPTION

OF

above

the

maintained by their

under

Section 401 of

respective

Relations

Act

the

comply

of

the

1983

Supp

Act

of 1974

Under

in

definitions

3a4

Sections

and

1947

as

LMRA

the

PROPOSED

Council

the

OPERATIONS

and

the

employee

to

Employers desire

pension benefit plans

members

The

Plans

Revenue

Code

of

all

are

1954

as

qualified

amended

the

of

the

Labor

requirements

Management

29 U.S.C.A

S141 et seq

1973 and

amended

and

the

Employee Retirement Income

Security

the

UOO1

program

be

et

1975

seq

and

Supp

1983

ERISA

Council

and

the

Employers will

The

Northwestern

Ohio

as

Building and

The

Foundation

will

the Foundation

the

known

foundation to

Construction Trades

Foundation

establish

an exemption from the

adviser

set

forth

in

Investment

Advisers Act

for

Internal

with

U.S.C.A

29

forth

upon

of

vehicle

and

set

or the

registering the foundation

advisers under the Investment

investment

Code

in

investment

noted

As

an

develop

the

from

exemption

Advisers Act in reliance

definition

of

investment

Section

Act

the

foundation

registering either

brokerdealers

under the 1934 Act

without

trusts

1934

the

1934

the

12h1a

in

of

statutory minimums specified in

exceeded

in

reliance

the

upon

are

exemption from

and

Act

Exchange

that

the

event

under

and

association

unincorporated

organized

will

be

under

Section

401

of

of Ohio and

by the laws

qualified

governed

that

benefit

the

Code

The

Foundation will provide

any

employee

plan

and cosponsored

Council

under Section

401 of the Code

by the

qualified

union affiliated with it or the Employers

or any

or any

local

employer

the

if

it

to

in

Foundation

affiliated with

participate

may elect

be

notforprofit

collective

investment

of

the

Plans

funds

is

not

prohibited

by

the

order

the

Plan

The

instrument

decree

or

creating

judgment

Board of Trustees the Trustees

Foundation will be administered by

the

Foundation shall

be

entitled to

two

Plan

in

Every

participating

Trustees

cosponsor

Plan

on

of

the

the

Foundations

Plan

and

the

Board

other

by

one

the

appointed

by

the

employer cosponsor

union

of

the

Office

of

Securities

Corporation Finance

and Exchange

Commission

27

October

Counsel

Chief

of

Division

1983

Page

Foundation will allow the

Plans

to

focus

portion of

investments

that

would

benefit

both

their

members

and the

their

local

Rather

than

in

community

investing

anonymous

corporations or

traditional

investment

other

more

media the Plans hope to encourage new

their

for

construction

within

and

create

their

jurisdictions

jobs

members

an umbrella organization

such

as the Foundation

By creating

the

Plans

can

contribute

to

the

of

number

of

larger

financing

and

involve

themselves

The

Plans

in more extensive

projects

projects

The

funds

also

can

on

the

achieve

expertise

the

economies of scale

Inherent in

Foundation viii allow the Plans

diversification among

providing

and

investments

Additionally

larger

to minimize their investment

risk

and

types

locations

the

by

available

investnents

of

that

could

they

not

obtain

individually

The

Foundation will approach

bank

and

loan

every

savings

and insurance

in

the

northwestern

Ohio

area

and

ask

association

company

that

members the opportunity to participate

they allow the Foundations

in

all

construction

loans

made

them

All

such

by

period

mortgage

shall

be

made

in

accordance

with

documents

prepared

participations

by

the

unless

the

Plans

the

Foundation

to

use

participating

agree

of

paperwork

the

institution

lending

information

from lending

institutions regarding

Upon receiving

the

Foundation

shall

on

this

information to

appropriate loan

pass

the

individual

Plans

Each

individual

Plan

its

trustees

or

through

other

investment

shall

then

determine

if

it

desires

to

manager

an

so

ate

amount

if

the amount

of

and

opportunity

would

their

decisions

to

the

relay

in turn

inform the lending

would

institution of

of

desired

The

atm

Plans

participation

par

reement

with

the

imesnt

to

in the

participate

its

participation

which

Foundation

re

loan

specific

The

Plans

Foundation

Foundation

as

trustee

and

oun

on

The

at

will

collect

the

aid

the

to

immediately forward

lending

received

institution

each

investment

The

institution will hold

lending

all funds

investments until it

contributed to it in certain specified

receives

all funds

and the loan transaction is closed

investments

trustee

in

of

the

Income

of

and

would

the

be

Trust

immediately

would

be

to

paid

distributed to the

will thus not hold

Plans

participating

Plan

funds

conduit

for

The

trust

Foundation

but

serve

time

merely

that

of

length

distribution

accounting

have

not

Trust

Plans

of

obligations

discretion over

assets

described

greatly

thereby

below

other

atd

than

as

the

simplifying

institutions

the

lending

the

investment

as

will render

related

no

Foundation

the

for

as

any

and

payment

and

recordkeeping

The Foundation will

or disposition of

management

the

Foundations

reserves

to

investment

advice

to

the

Plans

Office

of

Division

Chief

of

Corporation Finance

Conission

Exchange

and

Securities

27

October

Counsel

1983

Page

Foundation

will

incur

limited

amount

of

general

in

the

of

nature

and

expenses

postage photocopying

other

operational expenses as well as legal

and

accounting expenses

These

will

be

attributable

to

or

allocated

between

the

expenses

individual

Trusts

as determined by vote

of

the

Foundations

Board

of

Trustees

The

Foundations

reserve

expenses will be reimbursed from

established by the

Foundation from fees

collected

from

the

mortgage

borrower through

the lending

institution at the time the Trusts acquire

The

administrative

their

respective

amount

of

interests

These

fees will be

in the

participation

as

estimated

the

Board

excess

reserves

will

expenses

by

Any

be

distributed

to

the

and

additional

Plans

shall

be

expenses

any

reimbursed from the assets

of the Trust

or Trusts

for

the

responsible

all as determined by

the

Trustees

The

Foundation reserves

expenses

would

be

with

one

or

more

banks

or

and

loan

deposited

savings

institutions maintaining an office

in Lucas

and

invested

County Ohio

in the individual trust agreements

by the Foundation as specified

The

loan

Foundation

may

employees

are

prohibited

by

transactions

into

the

proposed to be entered

through

which

will

be

built

whose

projeØts

by

employers

covered

the

Plans

These

investments

would

be

by

fund

the

terms

that

act

the

Department

transactions

similar

Transaction

observe

following

must

financing

can

bank

independent

Section

been

have

made

be

338

of

an

406 of

exemption from Section

of

Labor

Department

to

those

761B

Service

the

described

761B

PTE

here

for

Under

which

loans

benefit plan

may be made

by an employee

covered

the

employees

by

plan

only

be made

and

commitment

for permanent

may

conditions

an

loan

absent

Exemption

has

employer who

loans

construction period

to

ERISA

nature

in

Prohibited

the

of

exemption has been adopted by the

and

the Internal

Revenue

Service

class

made

the

or

insurance

ERISA

or

someone

by

decision

to

the

which

company

by

Home

other

make

and

savings

than

the

loan

must

plan

be

before

made

the

by

an

meets the requirements

loan association subject

of

to

Loan Bank

Board pursuant to its sole

regulation by the Federal

or control

discretionary authority

regarding management of plan assets

the

and

loan

association must

insurance

or savings

bank

company

make such

loans

terms

and

conditions

from its own

on similar

commonly

their

established for

funds and the loan must satisfy

qualifications

the

review

aggregate

in any one

of

fair

the

of

investments

exceed

certain

of

loans

innnediately

after

making

investments

including

loans

of

an

the

loan

individual

the

plan

exceed

ten percent

employer participating in the plan cannot

market value of the plans assets and the aggregate amount

of

cannot

such

amount

of

the

plan

thirtyfive

records

of

individuals

specified

for six years from the

the

in

loans

of

percent

must

plan

including

date

of

the

to

all

the

be

plan

loan

its

employers

participating

and

fair

market

value

plans

retained

and

participants

made

and

available

to

beneficiaries

Office

of

Chief

of

Division

Securities

27

October

Counsel

Corporation Finance

and Exchange

Commission

1983

Page

The

herein

as

program

because

the

761B

PTE

trustees

described

of

does

Plans

the

not

within

fall

which

may not include

insurance

bank

or savings

and

loan association

will make the

company

investment

decisions on behalf of the Plans

The

Foundation has

filed

an application

with the Department for an administrative exemption under

ERISA

Section

based

on

the

criteria

of

PTE

For

761B

408a

of

purposes

its

will be

ruling

this

to

response

Based

actions

the

individual

Trusts

PROVISIONS

the

by

the

Investment

Company

Trusts

as

securities

under

in

Trusts

as

or

may assume

that

such

ANALYSIS

AND

Act

the

investment

as

companies

interests

in the

registration of interests

registration of the

under

the

1934

Act and

Act

1934

brokerdealers

as

Foundation or

Advisers Act

the

Company Act

Trusts

registration of

1933

under

Trusts

registration of

under

the Investment

Investment

the

opinion that

interests in

without

accomplished

be

may

the

Act

securities

the

Plans

Foundation or

under

Foundation

Staff

the

facts

set

forth

it

is our

upon

above

the proposed Foundation and

the purchase

of

of

registration of the

the

the

received

STATUTORY

the

letter

the

Trusts

as

investment

advisers

1940

of

The

of participations

in construction period mortgage

purchase

constitute

the

of

Even

if

the

may

acquisition

security

viewed

the

participations are

as securities

Foundation does

not

fall

within the definition of investment

of the

company at Section

loans

3a1

investing

Company Act

in

securities

behalf

each

Investment

on

of

behalf

will

of

engage

Trust

the

in

total

investment

criteria

are

but

its

Trusts

could

engage

the

such

acquire

owning

securities

holding

centum

of

Company

Act

40

per

Investment

assets

in

business

of

securities on

as trustee

and passively hold them

be argued however

that

each Trust

capacity

It

business of

value

exceeding

Section

of

will not

will merely

it

the

having

issuers

in

as

the

value

3c

such

from

the

definition

provides various exemptions

In particular

companies

meeting the following

within the definition of investment

company

company

not

of

3a3

Section

Aiiy

business

faceamount

who

person

is

issuing

certificates

periodic

payment

primarily engaged

businesses

not

engaged

redeemable

of

of

the

securities

type

or

and

who

is

certificates

one

or more of

purchasing

the

installment

plan

in

in

or

the

following

otherwise

Office

of

Division

Chief

of

Securities

and

27

October

Counsel

Corporation Finance

Coimnission

Exchange

1983

Page

acquiring

in

and

mortgages

other

liens

and

on

11

stock bonus

Any employees

trust

which

profitsharing

meets the

for qualification

under Section 401 of

Revenue

Code

of

the

Trusts

or

liquidation

available

will not

the

publE

the

Trust

in

partIcipate

The

See

Home

CCH 76704

Say

avail

thus

fall

within

the

Trusts

and

the

investment

company

Investment

The

interests

1980

of

language

3c11

The

actions

first

Fed

of

3c5C

employee

benefit

from

clause

of

themselves

can

and

Trusts

of

consisting

controlled

its

representing

or

of

group

18

the

the

Section

be

assets

or

sponsored

by

the

America

1980

Fed

See

Scripps

any

also

indicated

first

clause

casebycase

employers

Sec

of

basis

not

the

Fed

whose

will

plans

underlying

definition of an

3c11

of

the

viewed as single

established

non

and

employers

be

Sec

the

at1

As

companies

which

trust

and/or

subject

Rep

employees

to

is

union

by

registration

Rep

CCH 76321

January

trust

Staff

has

Workers

to

1179768

avail

in

trust

Workers

of

avail Jan 27 1980

1983

Although we are not aware

of

trusts has

as

qualified

stated

of

that

America

consider

3c11 to different

BankTrusteed

CCH

participate

Communications

employees

willingness

Section

need

the

Communications

its

of

of

available

where

trust

See

Rep

Trusts

generally to

corporation

parent

BankTrusteed

Pension

and

corporations

197374

union

instance

possible

real

Sec

refers

subsidiary

1974

employer

or

employees

companies

Plans

noncollective

an

by

their

Related

ProfitSharing

tate as

the

Section

excluded

are

Foundat1oj

inreai

1981

Association

The

made

be

ya mortgage upon

maintained

related

benefit

plans

by

in Communications Workers of America supra

established

supra

16

individual

trusts

explained

Apr

Oct

the

with

of

instance

and

oan

those

secured

loans-

will not

Act

Company

collective

interests

equity

PlªiTich

involvement

an

the

hold

Trusts

their

ngs

by

the

to

acqu.rine

Foundation

the

in

only

through

plain

Section

of

but

will be

Trusts

Internal

wa

Interests

in

property

the

redeems

be

will

they

requirements

1954

Trust

to

or

pension

3c5C Tb1.arivill

Section

which

jn

interests

estate

real

Pension

the

such

supra

situation

The

Staff

applicability

of companies

groups

and

ProfitSharing

of

is

has

the

on

Plans

Chief Counsel

of

Office

Division

of

Securities

Corporation Finance

and Exchange

Commission

27

October

1983

Page

under

of

the

the

in

sponsors

of

the

the

protections

Part

of the direct

interest

Company Act since because

welfare of their members/employees

imposing the

Investment

Investment

Act

Company

is

Feb

1051

CCII

will

join

This

can

enhance

only

who

sponsors

are

The

banded

to

members

In

of

Rep

several unions

situation

establish

Trusts

to

the

employers

present

from

to be

protections

gained

the beneficiaries

welfare

having

plan

in

related

are

also

Sec

Fed

in

the

coon

pursue

employees

that

sense

investment

have

they

to

goal

the

voluntarily

benefit of

can

sponsoring employers and unions

and

the

fact

by

geographic location

all work

in some

of

the

construction industry

The

that

they

aspect

Foundation

trustee

of

the

Trusts

will

be

under

Section

401

qualified

as

and

be

able

to

of the Code will have

no investment

will

not

discretion

will

sell investment

services

to

other

benefit plans

The

Plans

also

be

and

the

group

the

interested

Plans

together

their

1980

together with

See

unnecessary

IVB1d of Commission Release No 336188

seen

to

be

The

related

their

Trusts

maintain responsibility for each

to terminate

their participation

We

within

exempt

either

in

therefore

3a

Section

Securities

of

Act

through

their

power

Trust

of

the

to

be

3c11

of

1933

in

the

Interests

securities

Section

3a2

of

act

that

performance

the opinion that

fall

assuming the Trusts

Investment Company

Act the Trusts will be

of

from

registration as an investment company

by the provisions

Section

or Section

as explained above

are

3c5

deemed

the

Trusts

as

the

exempts

interest

to

defined

be

in

held

from

following

by

the

the

21

Section

Plans

of

the

trust

the

any

or

fund

Internal

Revenue

plan

in

Code

of

1954

the

other

contributions

than

under

maintained by

under

which

for

single

employer

of

the

contribution

an amount

in excess

employers

to

the

of

securities

is

allocated

purchase

issued

directly or

by the employer or by any company

under

controlled

or

controlling

by

indirectly

which covers

coion control with the employer

within

or all of whom are

employees

employees some

which are

bank

held

single

trust

be

Act

registration provisions

in

participation

single

which interest

or participa

stock

tion is issued

in connection with

bonus

the

which

meets

or

plan

profitsharing

pension

under

Section

401

of

for

qualification

requirements

any

could

1933

fund

and

ii

Corporation Finance

Commission

Exchange

of

Division

and

Securities

27

October

Counsel

Chief

of

Office

1983

Page

meaning of

iii which is

in

described

Staff

The

that

and

first

the

words

the

funded

plan

403b

Section

stated

of

clause

401c1

Section

the

trustfund

the

America

of

Workers

3c11 of

Section

single

Code

such

Communications

in

or

contract

annuity

an

by

of

Code

such

of

3a2

in--Section

supra

Company Act

Investment

the

of

indicated

1933

Trusts

of

trust

As

above

the

describe

same

type

of the Investment

of Section

will fall within the first clause

interests

or

Plans

Act

The

underlying eachirust will_acquire

Company

will

be

or

participations

participations in the Trust which interests

benefit plan

witht

Section

401 employee

issued in connection

Act

3c11

interest

No

with

connection

of

the

which

Code

by

of

investment

by

of

in

an

invest

the

Code

include

meaning of

an

annuity

of

the

the

of

assets

the

it

will not

any event

in excess

amount

the

funds

Keogh

thus

the

Trusts

the

interests

will

that

act

Plans

in

by

the

of

the

that

Sec

of

at

from

Section

some

point

plans

funds

is

or

plans

fund

the

employers

employer

under

of

Keogh

the

the

assuming

Section

Individual

is

created

bank

but

cause

that

the

by

trust

contribution

or

by

for

any company

under

common

by

or

the

interests

21

of

the

of

1933

the

Act

registration requirements

above

as explained

of

3a2

in

with

the

the

future

Trust

the

Trust

assets

-elects

interests

to

or

or any

plans

sold

to Keogh plans

of

the

1933

Act

Section

by

provided

exemption

by

an exemption from

be

registered pursuant to the 1933 Act unless

This

approach is consistent with

registration is then available

Fed

No 336281

of Commission Release

noted

in Part

covered

such

provisions

assets

participations

will

exempted

of

trust

the

that

opinion

securities

are

be

however

If

commingle

our

for

maintained by

Foundation will not

of

securities

by

the

purchase

controlled

controlling

or

indirectly

directly

with the employer

control

is

will

used

none

single

in

be

be

issued

It

described

contract

and

any

that

401c1

Section

Trust

public

extent

To

employer

and

Foundation

of

the

members

Accounts

single

all

the

2to

in

to

be

issued

Trust

is

expected

or

some

covers

employees

plan which

by

None

expected

Retirement

to

any

employees

funded

plan

any

presently

fund

the

within

403b

Section

for

held

or

are

or

direct

in

offered

or

3a2

the

IIB2

Rep

CCII 1052

Jan

15 1981

other

not

of

Office

Counsel

Corporation Finance

and Exchange

Commission

Chief

of

Division

Securities

27

October

1983

10

Page

Securities

12g

Section

$1000000

exceeding

of

1934

the

1934

Act

Exchange

of

and

class

held

of record

security

the

other

conditions

specified

with the Commission

security

12h1a

Rule

12h

Section

of

interest

register

from

exempts

with

assets

an

security other than

more persons and who meet

12h2a

Rule

Act

1934

equity

Securities

issuers

requires

by 500 or

to

therein

formerly

the

12g

Section

Act

of

exempted

of

Registration

the

class

under

promulgated

the

of

of

requirements

in an employee

stock

participation

purchase

profitsharing

pension

thrift savings

or

similar

retirement

incentive

plan which is not transferable by the holder except

in the event

of death or mental incompetency

or any

Any

bonus

or

stock

security issued

that

Assuming

Trusts

12h1a

Rule

contained

Section

excluded

are

as

in

the

Section

fund

to

such

plans

12g

could

from

the

language

of

3a2

of

of

provisions

12h1a

Rule

the

1933

Act

the

to

apply

is

fund

issued

In

related

companies

and

be

transferable

by

the

Plans

Thus

are

of

the

not

in

the

provisions

we

Trusts

of

should

Section

Securities

means

any

securities

interests

be

not

12g1

Exchange

in

of

Trusts

the

1934

1934

3a4

of

the

1934

person

engaged

in

the

business

of

others

the

Section

The

account

3a5

the

1934

dealer means

term

business

of

of

buying

own

account

through

not

include

bank

or

sells

securities

issued

to

in

pension

The

or

Trusts

of

group

will

Plans

the

and

Act

does

Act

provides

any

person

selling

any

for

as

BrokerDealer

The term broker

provides

of effecting

transactions in

but

not

include

engaged

securities

bank

in

the

for

his

but does

or otherwise

as be buys

person insofar

either

his

own

account

broker

or

Act

Registration

Section

for

that

or participations

opinion that interests

to

be

under

the

required

registered

of

Act

the

by

to

interests

connection with

stock

bonus

single

under

Section

401

of

the

Code

profitsharing

plan qualified

retirement

maintained

can

be

seen

as pension or

plans

by

trust

12g

equivalent

exempting

the

Trusts

Section

Office

of

of

Division

Securities

Corporation Finance

and Exchange

Commission

27

October

Counsel

Chief

1983

11

Page

individually or

as

of

part

in some

fiduciary

regular business

not

but

capacity

15a1 of the 1934 Act provides in part

Section

It

shall

to

make

unlawful

be

of

use

instrumentality of

in

transactions

any broker

mails

or

for

the

interstate

or

to

any

commerce

induce

or

dealer

or

to

means

effect

to

attempt

or

any

induce

of

other than an

any security

commercial

bankers

security

paper

commercial

unless

such

broker

or

bills

acceptances

or

dealer

is

in

accordance

with

registered

subsection

of this section

the

or

purchase

sale

or

exempted

It

that

argued

have

to

be

might

would

individual

Trusts

individual

Trusts

however

effecting

transactions

in

behalf

of

their

either or

register as

will

be

not

Plans

the

As

Foundation and the

or dealers

The

in

the

business

of

brokers

engaging

either

securities

participating

both

for

their

own

account

above

indicated

or

each

on

Trust

the

of

enter

into

transaction

purchase

only

single

mortgage loan and will dissolve

upon the completion

participation in

of

that

transaction

Funds

held

as

reserves

the

Trusts

by

may be

invested

the

Foundation as

trustee

in

securities

i.e

exempt

by

couercial

commercial bills obligations

paper bankers acceptances

not

issued

the

United

States and

notes

or

guaranteed

by

having

To the extent

that

Trust

would invest

maturity exceeding nine months

these

investments would be made only through

in nonexempt

securities

The

Trusts

will hold any

brokerdealer

registered under the 1934 Act

and

with

the

securities

for

will

not

investment

purchase

acquired

will

intent

to

distribute these

We

as

register

securities

on

to

facilitate

are

also

broker

securities

of

the

its

own

the

collective

that

the

Foundation

Foundation will not be

will be acting

merely as

opinion

dealer

As

behalf

The

or

it

purchase

participations

will not

actually

effect

Digital

Equipment

Corp

Oct

The

Foundation will hold no funds

1978

minimal investment

and

have

only

expenses

for

will

its

merely

contributions

act

of

in

the

transactions

of

an

Plans

1979

Fed

for

the

Sec

administrative

deliver the

and

accounts

Rep

by

of

capacity

collected

conduit

Plans it

others

See

than

avail

reserves

responsibility

to

not

the

CCH 81931

other

need

acquiring

collect

contributions

interests

It

the

to

to

the

the

institution selling

participation

mortgage

Trusts

The

Foundation will act only on the Plans behalf and will not

behalf of

otherwise

seek

to

act

on

solicit

additional

customers

or

The

Foundation will have

no significant

other

than

the

Plans

anyone

the

Office

of

Chief

Division

of

Page

Corporation Finance

Commission

Exchange

and

Securities

27

October

Counsel

1983

12

and

will

not

assets

or

sponsor

analyze

The

participation

proposals

Foundation

through

Board

of

is already subject

Trustees

to

coon

duties

fiduciary

to

the

Plans

and

to

recommend

loan

any

the

members of its

law

and

the

of

contractual

ERISA and the

requirements

the

Foundation

will

Finally

not

undertake

sales

or

any

and will receive

promotional efforts

no compensation

from the Plans

for

taken

any actions

by it on behalf of the Trusts but would receive

only

reimbursement for

incurred

in

ministerial

expenses

performing its

functions

LMRA

When

all

of

these

factors

are

taken

it

becomes

together

neither the Trusts nor the Foundation need to be registered

evident

that

brokerdealer

as

increase

serve

to

Requiring

registration would

merely

burden

and

regulatory

expense upon the Foundation and its

while duplicating

the regulating

effect

of bodies already

the

Plans

themselves

oversight responsibilities

including

the

member Plans

with

charged

Advisers

Investment

Section

Act

of

1940

202a11

of

the

Advisers

Investment

Act

defines

an

as

adviser

investment

for

person who

business

of

advising

in

the

compensation

engages

either

others

or

directly

any

of

publications or writings as to the value

through

securities or as to the advisability of investing

in purchasing

or selling

securities

or who

for

of

and

as

compensation

part

regular

business

issues

or promulgates analysis or reports

concerning

securities

In

fall

within

Plans

will

of

the

neither the Trusts

Foundation will

nor

the

opinion

definition of investment

adviser

Assuming that the

our

the

202a18

in Section

purchasing securities as defined

the Trusts

Advisers Act through

It could

be

Foundation will be in the business of advising others

be

Investment

that

the

the

Plans

selling

as

to

the

advisability

securities

close

makes

advisory

information

from

services

to

from

lenders

the

Plans

Foundation

thus

The

participations

the

the

concerning

has no part

Trusts

are

are

purchased

the

in

it

clear

and

The

to

Plans

amount

the

and

Plans

sole

instructions

want

to

invest

of

the

the

vehicles

no

have

receives

decisions

have

Plans

the

investment

merely

and

the

the

Foundation provides

Foundation merely

transmits

that

Plans

the

or

purchasing

the

Foundations

of

that

namely

in

investing

analysis

however

responsibilities

responsibility for making investments

no

of

argued

separate

through

existence

or

The

Plans

which

function

Office

of

Counsel

Corporation Finance

and Exchange

Commission

Chief

of

Division

Securities

27

October

1983

13

Page

from

holding their

apart

particular

participations

therefore

play no role in the investment decisions of

NOACTION

POSITION

upon the foregoing facts

taken

the

positions

by

the

considerations

policy

statutes

REQUESTED

Based

prior

noaction

of

Trusts

The

the

Plans

and

releases

Coission

Staff

and

will

the

our

and

statutes

involved

we

that the Staff

respectfully request

advise

it will not recommend

us that

to the Commission that

action be taken

under the 1933 Act

or 1934

any

analysis

Act

as

in

We

ask

Office

of

Chief

confirmation

as

the

regarding

summarized

an

that

proposed

operations

this letter

that you forward

Counsel

for the

the

investment

under

under

the

the

enclosed

Division

Foundation and

company

adviser

investment

an

of

the

the

of

Foundation

the

need

not

be

Company

Advisers

Act

Act

Investment

as

contact

the

undersigned if you

Very truly

SHUMAKER

By

GLC/sjs

Attachments

Enclosures

cc

Marc

Gertner Esq

have

any

or

LOOP

KENDRICK

for

as

an

explained

questions

yours

the

registered

above

Please

Trusts

of this letter

to

copy

Investment

Management

Trusts

Investment

and

KENDRCK

SHUMAKER LOOP

NORTH COURTHOUOE

ALL

SQUARE

T0LEO

JACXSON

i1Cj

LGDP

OHIO

43C24

419

__

O-I

AC.ET

TMOH4AS

WESB

DNNS

KEV

Al

ALJR

GREG

j.rrO

GEOCEA.P1CKNELL

DO.A.0

MY-iQ1

EOWIH

E.1ESON

JP

BARTC

30

November

1983

OHH

I-

WILLAM

GOSiNF

Re

The

4EW.000

FrW.ICIS

orthwest

Construction

jn

McANEL

No

Our File

Ohio

iuilding and

ouncation

N1575/16191

Trades

JANET

JN

PCM

E.CATIJN

GREGORY

AP-4

wcw

COuNSEL

CH.RLE

SCKAPFY

OF

P.

CN

WiT

MacKAl

JOl-iNC

Ms

KarEn

Burgess

Securities

450

SRAi3

M.rket

of

Division

Regulation

Exchange CnmnLision

and

Strt

5th

D.C

Uashirgtcn

20549

Ms uress

Dear

ou

BFtsed

conversations

on behalf of

concerning our noaction request

Foundation

revised

the

Foundation we hereby submit

our

cboveaptiond

the

than

request

the

sion dcvie

Staff

that

us

Ccis

the

SecurIties

and

Cotizission

Exchange

the

will not recoriend that the Commicion take

enforce

any

tha

of

the

Foundation

without

the

actions

registering

of

it

ment action

concerning

Foundation as

brokerdealer

under

Act

letter

will

Octcber 27

Corporation Finance

1983

This

letter of

Plans

In particular

maintained

by

$2000000

the

suppier-ient

addressed

Securities

the

factual

to

the

we repesent that

participants

the

Echane Act

rpreser.t-ations

Office

the

of

of

Chia

the

1934

contained

1934

ir our

Counsel Division

employee pesinn benefit plans

Foundation range

size

in

the

ifl

of

the

from

in total

$30000000

assets with the combined assets of the Plans

The

investments

to

be

entered

into

each

$811000000

mortgage

by

the

Foundation

will

to

between

tr1t established by

amount

$2000000

to

exceeding

transac.tior

and

SHIBLEY

t.1

tiAVID

GAIY

SlTZER

ONIHI

SANDERSCN

GARY

SALES

MCHAEL

McGOWAN

MARY EL.LEN

PISMNELL

DAVDG.S0JILLANTE

GREGO2

LODGE

.R

R0EPT

LYMAN

MICHAEL

i.i.AfNPD

1LLIA

M.CARfl-fY

B3AcM

JUDANZP.JGER

iiACN4AN

SKDEI

ROLF

BA

RENEE

ALETA

W4ZMuSC-.AN

C-.APMAN

FYES

JACK

1IMOTHY

I3

ROBERT

W.APC

I.

TEELL

rI

.Y-N

BCEMA

CARL

ZUT

J3S

GEORGE

/.

OK

VVIAN

241-4201

PA.i

MALCO.M

.TEWAN

DAvD

Gi

GJ_

-flCI3

$5000000

determined to reduce

its

involvement

in each

Foundation has

also

whiic still providing the lending

imtitutions with an adinis

Piar

convenient program

orignaily contplated each participatng

tratively

was to fc7ard funds

to

the

ord of the Foundation which would take pnssessicr

The

trausiction

of

the

trust

sum

to

on

the

trust

frds cccuuIate

was

fully

bctalf

funded

of

Foundatc-n

the

them

ruid

cru

chih

in

deliver

-onld

Incci..e

Lransaation

tho

of

distr.but

funds

the

trust

to

the

trust

as

the

funds

lo

account

until

the

tiansaction

institution

Jt.nding

to

delivcred in

the

Plns

in

lump

luap

sut

Karen

November 30

14s

Burgess

1983

Page

the

he m.ide

Foundation now proposes

to collect

investments

to

by

in

the

form

of

checks

each individual Plan

or federal funds

drafts

made payable to

of

income

the

institution

the

trust

would be allocated

the

Any

among

lending

various participating Plans by the lending

institution which would prepare checks

These checks

would be delivered to the Foundaticn

to the individual Plans

which

The

would

distrIbute

would

continue

these

to

pay

checks

Plans

individual

the

to

directly

lending institution

which

is

to be

This administrative

The

the

Foundation the loan

incurred

by the Foundation

to

fee

borrower for expenses

would

of the Plans

procedure

provide maximum protecticn of the funds

by minimizing

the opportunity for and effect of any misapprcpriation

of funds

by the Foundation

the

of

the

transctioa

could

be

and

At

same

time funds

trusts

conveniently

transferred

to

the

institution

with

minimum

of

involvement

efficiently

lending

charged

the

by the

lending

institution

In modifying the transaction as proposed the Foundation seeks

to comply

mandate contained

within Section

of the Employee Petirement

Income

Act of 1974

that

each

Plan

Security

qualified thereunder must

which

be

Plan

minimize the

are

to

expenses

charged

against

participants

with

404a1A

the

ERISA

29

1104a1A

U.S.C.A

Tenn

1977

Section

of

payment

404a

1975

unreasonable

Sea

Marshall

amounts or for

Mo 376373

Wilson

unnecessary

expenses

E.D

violates

ERISA

of

By utilizing

the Foundation

Foundation

the

as

trustee

for

each

of

the

transaction

to save

trust

trusts

expects

approximately $5000

per transaction

over the cost of utilizing

bank trustee

for each

trust

This would result

in

substantial savings

Plans

the

life of

the

to the

Foundation

over

e.g if the

Foundation

formed

$50000

over

two

believe

the

the

the

protections

Please

contact

provided

the

by

brokerdealer

the

undersigned

if

SHUMAKER

you have

LOOP

By

Mark

UiIsj

John

Gorman

Division of Corporate Finance

Securities and Exchange

Commission

Iarc Gertner

George

savings

any

questions

Esq

Chapman Esq

High

KENDRICK

of

protections

contract

law when

nature

of

these

the

Staff

registration provIsions

Ver truly yours

cc

years

to

with

We

next

of

ERISA and

state

common and

provisions

nonsecurities

essentially

connercial

would

comfort

loan

transactions

mortgage

provide

by

concerning

the

the

afforded

be

transaction

trusts

over

realized by the Plans

that

combined

shortterm

ten

could

SHUMAKER LOOP

NORTH COURTHOUSE

SOUARE

LOOP

PPANCISJ

GALLAGHER

KENDRICK

TOLEDO

JACKSON

1000

OHIO

43624

ALAN

ROBERT

WATERMAN

DAVID

49

GOSLINE

FOLK

VIViAN

241-4201

JOSEPH

RIDEOuT

MA.COLM

RAMEY

JOHN

HACKETT JR

THOMAS WEBB

ALEXANDER

GREGORY

GEORGE

CARL

JACK

KEVIN

JOHN

BRLJGGEMAN

CLAYTON JR

MARC GEPTNER

GEORGE

PICKNELL

MEWNORT

JR

DONALD

EMERSON

EDWIN

JAMES

M.TUSCIMAN

ROBERT

BARTON

FYNES

TIMOTHY

RENEE

March

12

JUDH

1984

SelTZER

BONINI

ANN LANZINGER

SANDERSON

MICHAEL

SCHEIDEL

GARY

JOHN

HAYWARD

GOSUNE

MICHAEL

MARY

NORMAN

NARTSEL

WILLIAM

P4EYW000

SALES

ELLEN

DID

THOMAS

JOHN

BJRSON

THOMAS

WEBB JR

ROBERT

ANSPACH

DAVID

WICKLUND

GARY

DIESING

JOHN

MhcAY

MCGOWAN

PSANEUJ

SOUILLANTE

GREGORY

III

JR

MCDANIEL

PLETZ

LODGE

JANET

CATLIN

PHILIP

CHUBB

THOMAS

GREGORY

OR

W000MAN

Si-IIBLEY

COUNSEL

CHARLES SCHARFY

CORWIN

JOHN

STRAUB

SWIFT

Mr

Harmon

Thomas

Division

of

450

Investment

and

Securities

Management

Commission

Exchange

Street

5th

D.C

Washington

20549

Re

Dear

Northwest Ohio Building and

Construction Trades

Foundation

Our File No N1575/16191

The

Mr Harmon

Based

on

our

our

we

behalf

of

submit

hereby

the

abovecaptioned

additional

factual

representations are for your use in responding

of the Securities

and Exchange

Staff

Commission

advise

that

will

us

it

not

recommend

that

the

that

request

on

These

representations

the

conversations

Foundation

the

foundation

to

INGLIS

ALETA

WAGENMAN

FRANCIS

MCCARTHY

BIRNBAUM

JOHN

LYMAN

ROLF

WILLIAM

CHAPMAN

WITHEREU

GRAHAM

SARRON

DENNIS

the

Commission

Commission

take

enforcement

action

the

actions

of

the

concerning

Foundation or the Trusts

to be

created

thereunder without registering

the

Foundation

the

Trusts

investment

under

the

or

as

companies

Investment

of

1940

the Investment

and

Company Act

Company

without

advisers

as investment

registering the Foundation or the Trusts

under

the

Investment

Advisers

Act

of

1940

Investment

Advisers

the

Act

Act

This

addressed

Finance

Division

letter

the

Office

supplement

Chief

of

November 30

Market Regulation

1983

and

of

will

of

to

our

letters

Counsel

addressed

of

October

of

Division

to Ms Karen

27

1983

Corporation

Burgess

the

Foundation will be providing

question of whether

confirm

that

the

Foundation

will contact

all banks

advice we

and

and

loan

associations

located

within

the

savings

geographic area

served

Foundation and request

that

those

financial

institutions

by the

the

with

information

all

construction

Foundation

provide

concerning

On

investment

the

Mr

Harmon

Thomas

12

March

1984

Page

which

opportunities

Foundation shall

transmit

to offer participations

participating

pension plans

Plans all materials received from all cooperating banks and

the

and

loan

associations

It

is then

the

savings

responsibility of the

individual

Plans

to determine whether

that

to

particular Plan desires

loan

mortgage

In

The

they

to

desire

all

The

Foundation will not

screen in any

participate In any given loan

to

and

the

brought

it

individuals

way any proposals

representing the

Plans

will take all proposals presented to them back to their respective

for decision

Plans

Foundation has

The

reserve funds

Instead

the

borrowers

at

distributed through

any

either

Trusts

determined to dispense with

on its behalf or on behalf of

all

loan

participation

fees

time

that

the

made

the

the

holding of

Individual

from

the

collected

will be

immediately

the Foundation directly to the Plans

who are members

of that particular Trust

Any expenses incurred by the Foundation will

then

be

assessed

to

and

the

individual Plans

Under this

paid by

the Foundation will not hold any

funds

In reserve and thus have

design

no investment

responsibilities relating to the reserves

I_ussions

structure

concernig_the

Tisyillng acquire

y.rf

tb_the

of

the

loan

is

United

Fouiidptipn

States

it

was

of

Labor

Department

established that

50%

more than

limitation is

participatirm fn any individual

in addition

the

to

limitations

each

Plan

for

of

the

from

certain

place

upon

purposes

exemption

of

ERISA

of

the

of

described

provisions

requested

Department

Labor as

in our letter

to the Division

of Corporation Finance

dated

October 27

1983

This

limitation on the size of the investments

which

Trust

may

make will

the ability

of the Trust

to effect

enforcefiU

ba

construction

This

npffcf

cft.I

ridocuments

foreclosure on the mortgage in the

including

occurrence

of

nt of default

under the loan documaliiti

March

Finally as we related to

the

administrative

1984

performed

Northwestern

by

Ohio

event

conversation

you in our telephone

functions

of

the

Foundation will

Administrators

Inc

an

of

be

Ohio

Arthur

serve

corporation

as

Young

Company will

accountants

to the Foundation

and it is anticipated

that this firm will

serve

counsel

The

will annually review the

accountants

as Its legal

finances

of the Foundation and

the

Trusts

which have been in existence

The

Foundation will either

distribute copies

that

of this

during

year

review

or

to

an

annual

based

on

this

be

report

report

prepare

notforprofit

distributed

be

clearly

Foundations

indication

investment

to

the

Plans

identified

accountants

concerning

results

either case the information provided will

factual

information

the

prepared

by

will not

and

be

as

presented

providing any

In

as

future

investment

possibilities

or

projected

Based on the foregoing we are of the opinion that r.ither the

Foundation nor the Trusts will fall within the definition of investment

Mr Thomas

Harmon

12

March

1984

Page

202a11

of the Investment

Advisers Act

contained in Section

the

the

Foundation and

the

Trusts will be

exempted from

investment

contained

in

Section

of

the

definition of

company

of that

Investment

Company Act by the provisions of Section

adviser

and

that

3a

3c5C

Act

We

trust

process

We

colleagues

have

questions

or

these

appreciate

to

given

concerns

will assist

you

attention which

representations

the

time

and

our

letter

please contact

If you

request

the undersigned

Very truly

SHUMAKER

MRH/sjs

cc

John

Gorman

Division of Corporation Finance

Karen

Burgess

of

Division

Marc

Gertner

George

Market

Esq

Chapman

Esq

Regulation

have

yours

LOOP

By

Mark

your review

you and

your

in

High

KENDRICK

any

further

2D 984

Our

Ref No

83373CC

Northwestern

RESPONSE

OF flE OFFICE OF CHIEF CJNSEL

DIVISION

OF

Ohio Building

Construction Trades

Foundation

INES1ENT MAAGEME

File No

1323

The Northwestern Ohio Building and Construction Trades Council

confederation

of local building and construction trades unions represent

and construction

tradenen working in northwestern Ohio and

ing building

Northwestern Ohio Council of Construction flnployers

confederation

employers in the same industry in the same geograMc area propose to

establish

foundation for the benefit of the employee pension benefit

their members sponsor

or

The foundation

plans

they

notforprofit

association

and

organized

unincorporated

governed by the laws of Ohio

would

be administered by

board of trustees

Every plan participating in

the foundation

would be entitled to two trustees on the foundations

board

one appointed by the union

cosponsor of the plan the other by the employer

of the plan

construction pericd

cosponsor

Thp1ans iiuld invest

mQrtgg loans throqgh the medium rf trut created pursuant to trist

the

of

trust would never

ac

designating the foundation as trustee

trian

5U% participation

th

construction period itortgage loan

enable the foundation

bujyrticipation it wouldJxld

as trustee

quirenore

for

trust

to

forec

u1d

the

mortgag

securing

the

loan

in

the

event

of

default

We

would

action

under

Act of

1940

the

not

Commission take

any enforcement

Act

of

1940

the

Investment advisers

or

Company

foundation or the trusts if they proceed with their

recommend

that

the

Investment

against the

without registering

as either

investment companies or investment

on the facts

and representations in your

position is based

letters

and exhibits of October

27 1983 November 30 1983 and March 12

1984 and upon the statements made by Mark High and Marc Gertner of your firm

to Thomas Harman of the staff on January 25 February

February 27

March

1984

We will first discuss with

29 and April

respect to the

foundation

and then

to

trust the applicability of the Investment Company

Act and then

the Advisers Act

proposal

advisers

Our

Section

3a

of the

Company Act defines an investxnent

which is or holds itself out as

any

in

the

business

of

or trad

being

engaged primarily

investing

reinvesting

in

is

or

to

in

the

business

of

securities

or

ing

engaged

proposes

engage

in

securities

and

or

owns

investing

reinvesting

owning holding

trading

securities having

value

or proposes to acquire

investment

40 per

exceeding

of such issuers total assets exclusive of Government

centum of the value

Section

securities and cash items on an unconsolidated basis

companyTM

in pertinent

part

Investment

as

issuer

2a 22

defines

ity

or

to issue

TMissuerTM

as every person who issues

or proposes

which

it

has

issued

has outstanding

any security

any secur

the

Because

foundation

would not

issue

any security or interest to

2a22

and there

anyone it would not be an issuer as defined by section

fore it would not be an investment ccinpany as defined by section

Eaci trust however would issue uity interests to various plarE and

an issuer

thus would

oreoveth trust woulJld assetsconsisting

cortruct Ion idrvrtgage J.Q.-A_CVnstruc

oley oLrticpa4orE in

oan

loan

3a

secured

on an

term

in

construction1roject

security

setibiF2

36

the Investment Carpany Act thcles any note or par

or any

ticipation in any note

Atruction period nortgage.loan

.in

udig

fh

..j

1nn

paticiptHon

ofjisecirity ctained in section

trust thus

appear

to be an investTint

caipany subject to

tiin

period

The definition

ed

of

the

frr

44nH

fr

m1i

2a36

ild

thcwestnæ Atjgj

ex

3c 5C

Section

of the Investment Canpany Act in pertinent part

fran the definition of investment canpany

any person who is not

engaged in the business of issuing redenable securities and who is prisnar

in purdiasing or otherwise

ily engaged

auiring nortgages and other liens

on and interests

in real estate

The participation

interests

in

cons truc

tion period prgage loan

truct would be an interest in real estate

by

excepts

he

whereeth

loan is fully secured

by real prcierty

andtheparicion

nterests

held by the trust are sufficient to give the foundation

asE�stee

for the trust th.gbt by itself to foreclose the nortgage

iiie event

it is

BecaUse

repreØi

that

eaci

interests

astrustee for the

secri thIÆæ

MIC Mortgage

default

of

Corporation pub avail August 1Ig741

loan would be tui.ly securdbyreal prcperty

trust would give the foundation

heIda

trust the tight by itself

in the event of default it

to

foreclose

the

nr�

be

otherwise

and

othr

zdiasir or

eraged

uiriri nrrtgaqes

liep on r1 interests

-estate

trust would not appear to be isiuing

redeenable

securities

within the meanirg of section

because

the plan

trust would not be redeenable except

plans interest in

witFrawal fran the trust or liquidation of the trust and because witndrawal

secur4g

the

pry

loan

appears

trust would

that

in

r1

3c5

un

fran

status

trust would be conditioned upxI

plans

iider the Internal

Recenue Code of 1954

excepted

fran the

Section

a3viser

Investment

202a11

of

of exetpt or qualified

trust would

Accordingly

Canpany Act pursuant to section

loss

be

3c

the

Mvisers Act

in part

defines

an

inestnent

as

any person who for

of vising others

in the business

canpensation

engages

either directly or through publications

or writings as to the value of securities or as to the

or selling securities

visability of investing in purthasing

or who for canpensation and as part of

regular business

issues or pranulgates analyses or rerts concerning securities

Because

the foundation

intends

to contact

institutions in northwestern

lending

Ohio to learn of the availability of participations in mortgage loans and

to the plans

pass this information along

question exists as to whether

foundation

the

would be

issuing

or

proim.ilgating

analyses or

reports con

securities

cerning

foundation

intends

to approach every bank

savings and loan

insurance

in

the

northwestern

Ohio area and ask

association

company

that

the

foundation

with

information

they provide

concerning all con

struction period mortgage loan opportunities

in which they desire to

The

and

offer

or

The

foundation would not sponsor

screen analyze

Each individual plan

any loan participation opportunities

trustees or other investment manager would determine whether to

participations

recommend

its

through

loan opportunity

and if it does the amount of

participate in

specific

its participation

The foundation would transmit to all participating plans

all materials received

from all cooperating

financial institutions

The

information

the

institutions

and

foundation transmits would

would be so identified

be

prepared by the

various

lending

In Texas Newsletter

pub avail January 23 1984 we stated that

action would be reconended

to the Canmission if

without

newsletter

under

the

Advisers

information

Act

about

securities

registering

printed

no

security would be prepared by the issuer

presented as an advertisement for the security

Because the foundation would

distribute only information about

construction period mortgage loan prepared by the

participation in

cooperating financial institution issuing the participation

identify

such

information

as having been prepared by the cooperating

financial

transmit

all information given to the foundation

institution and

without commenting on screening

or evaluating the information in any

manner we would not consider the foundation to be engaged in the business

where

any

of

the

of

issuing

such

information

security and

would

about

be

or promulgating

analyses or reports concerning securities

would not regard the foundations

to bring the

proposed service

foundation

within the definition of investment

adviser contained in section

of the Advisers Act

202a

Thus

we

11

trusts sole function would be to hold participations in

Because

construction period mortgage loan selected

by the plans partici

in the trust

trust would neither be engaged

in the business of

pating

others

about

the

value

of

securities

the

or

advising

advisability of invest

particular

in securities nor

securities as part of

ing

be

an

Act

investment

adviser

or

promulgating analyses or reports concerning

business

trust would not

Accordingly

regular

defined

section

of

as

202a

the Advisers

by

issuing

11

We

understand that the Division of Corporation Finance and the

of Market Regulation will be writing separately to address

issues

you have raised

regarding the Securities Act of 1933 and

Securities Exchange Act of 1934

Division

the

the

470

omas

Harinan

Attorney/vi

ser