Grant of Individual Exemptions; First Hawaiian Bank, et al.

DEPARTMENT OF LABOR

[Prohibited Transaction Exemption 96-1; Exemption Application No. D-

09877, et al.]

Grant of Individual Exemptions; First Hawaiian Bank, et al.

AGENCY: Pension and Welfare Benefits Administration, Labor.

ACTION: Grant of Individual Exemptions.

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SUMMARY: This document contains exemptions issued by the Department of

Labor (the Department) from certain of the prohibited transaction

restrictions of the Employee Retirement Income Security Act of 1974

(the Act) and/or the Internal Revenue Code of 1986 (the Code).

Notices were published in the Federal Register of the pendency

before the Department of proposals to grant such exemptions. The

notices set forth a summary of facts and representations contained in

each application for exemption and referred interested persons to the

respective applications for a complete statement of the facts and

representations. The applications have been available for public

inspection at the Department in Washington, DC. The notices also

invited interested persons to submit comments on the requested

exemptions to the Department. In addition the notices stated that any

interested person might submit a written request that a public hearing

be held (where appropriate). The applicants have represented that they

have complied with the requirements of the notification to interested

persons. No public comments and no requests for a hearing, unless

otherwise stated, were received by the Department.

[[Page 3479]]

The notices of proposed exemption were issued and the exemptions

are being granted solely by the Department because, effective December

31, 1978, section 102 of Reorganization Plan No. 4 of 1978 (43 FR

47713, October 17, 1978) transferred the authority of the Secretary of

the Treasury to issue exemptions of the type proposed to the Secretary

of Labor.

Statutory Findings

In accordance with section 408(a) of the Act and/or section

4975(c)(2) of the Code and the procedures set forth in 29 CFR part

2570, subpart B (55 FR 32836, 32847, August 10, 1990) and based upon

the entire record, the Department makes the following findings:

(a) The exemptions are administratively feasible;

(b) They are in the interests of the plans and their participants

and beneficiaries; and

(c) They are protective of the rights of the participants and

beneficiaries of the plans.

First Hawaiian Bank Located Honolulu, HI

[Prohibited Transaction Exemption 96-1; Exemption Application No. D-

09877]

Exemption

Section I. Exemption for In-Kind Transfer of Assets

The restrictions of section 406(a) and section 406(b) of the Act

and the sanctions resulting from the application of section 4975 of the

Code, by reason of section 4975(c)(1)(A) through (F) of the Code, shall

not apply to the in-kind transfer to any opened investment company (the

Fund or Funds) registered under the Investment Company Act of 1940 (the

'40 Act) to which First Hawaiian Bank or any of its affiliates

(collectively, the Bank) serves as investment adviser and may provide

other services, of the assets of various employee investment funds (the

CIF or CIFs) maintained by the Bank or otherwise held by the Bank as

trustee, investment manager, or in any other capacity as fiduciary on

behalf of the Plans, in exchange for shares of such Funds, providing

the following conditions are met:

(a) A fiduciary (the Second Fiduciary) who is acting on behalf of

each affected Plan and who is independent of and unrelated to the Bank,

as defined in paragraph (g) of Section III below, receives advance

written notice of the in-kind transfer of assets of the Plans or the

CIFs in exchange for shares of the Fund and the disclosure described in

paragraph (g) of Section II below.

(b) On the basis of the information described in paragraph (g) of

Section II below, the Second Fiduciary authorizes in writing the in-

kind transfer of assets of the Plans in exchange for shares of the

Funds, the investment of such assets in corresponding portfolios of the

Funds, and the fees received by the Bank in connection with its

services to the Fund. Such authorization by the Second Fiduciary to be

consistent with the responsibilities, obligations, and duties imposed

on fiduciaries by Part 4 of Title I of the Act.

(c) No sales commission are paid by the Plans in connection with

the in-kind transfers of asset of the Plans or the CIFs in exchange for

shares of the Funds.

(d) All or a pro rata portion of the assets of the Plans held in

the CIFs or all or a pro rata portion of the assets of the Plans held

by the Bank in any capacities as fiduciary on behalf of such Plans are

transferred in-kind to the Funds in exchange for shares of such Funds.

(e) The Plans or the CIFs receive shares of the Funds that have a

total net asset value equal in value to the assets of the Plans or the

CIFs exchanged for such shares on the date of transfer.

(f) The current market value of the assets of the Plans or the CIFs

to be transferred in-kind in exchange for shares is determined in a

single valuation performed in the same manner and at the close of

business on the same day, using independent sources in accordance with

the procedures set forth in Rule 17a-7b (Rule 17a-7) under the '40 Act,

as amended from time to time or any successor rule, regulation, or

similar pronouncement and the procedures established by the Funds

pursuant to Rule 17a-7 for the valuation of such assets. Such

procedures must require that all securities for which a current market

price cannot be obtained by reference to the last sale price for

transactions reported on a recognized securities exchange or NASDAQ be

valued based on an average of the highest current independent bid and

lowest current independent offer, as of the close of business on the

last business day preceding the date of the Plan or CIF transfers

determined on the basis of reasonable inquiry from at least three

sources that are broker-dealers of pricing services independent of the

Bank.

(g) Not later than 30 business days after completion of each in-

kind transfer of assets of the Plans or the CIFs in exchange for shares

of the Funds, the Bank sends by regular mail to the Second Fiduciary,

who is acting on behalf of each affected Plan and who is independent of

and unrelated to the Bank, as defined in paragraph (g) of Section III

below, a written confirmation that contains the following information:

(1) The identity of each of the assets that was valued for purposes

of the transaction in accordance with Rule 17a-7(b)(4) under the '40

Act;

(2) The price of each of the assets involved in the transaction;

and

(3) The identity of each pricing service or market maker consulted

in determining the value of such assets; and

(h) No later than 90 days after completion of each in-kind transfer

of assets of the plans or the CIFs in exchange for shares of the Funds,

the Bank sends by regular mail to the Second Fiduciary, who is acting

on behalf of each affected Plan and who is independent of and unrelated

to the Bank, as defined in paragraph (g) of Section III below, a

written confirmation that contains the following information:

(1) The number of CIF units held by each affected Plan immediately

before the conversion (and the related per unit value and the aggregate

dollar value of the units transferred); and

(2) The number of shares in the Funds that are held by each

affected Plan following the conversion (and the related per share net

asset value and the aggregate dollar value of the shares received).

(i) The conditions set forth in paragraphs (d), (e), (f), (o), (p),

(q), and (r) of Section II below are satisfied.

Section II. Exemption for Receipt of Fees from Funds

The restrictions of section 406(a) and section 406(b) of the Act

and the sanctions resulting from the application of section 4975 of the

Code, by reason of section 4975(c)(1) (D) through (F) of the Code shall

not apply to the receipt of fees by the Bank from the Funds for acting

as the investment adviser, custodian, sub-administrator, and other

service provider for the Funds in connection with the investment in the

Funds by the Plans for which the Bank acts as a fiduciary provided

that:

(a) No sales commissions are paid by the Plans in connection with

purchases or sales of shares of the funds and no redemption fees are

paid in connection with the sale of such shares by the Plans to the

Funds.

(b) The price paid or received by the Plans for shares in the Funds

is the net asset value per share, as defined in paragraph (e) of

Section III, at the time of the transaction and is the same price which

would have been paid or received for the shares by any other investor

at that time.

[[Page 3480]]

(c) Neither the Bank nor an affiliate, including any officer or

director purchases from or sells to any of the Plans shares of any of

the Funds.

(d) As to each individual Plan, the combined total of all fees

received by the Bank for the provision of services to the Plan, and in

connection with the provision of services to any of the Funds in which

the Plan may invest, is not in excess of ``reasonable compensation''

within the meaning of section 408(b)(2) of the Act.

(e) The Bank does not receive any fees payable, pursuant to Rule

12b-1 under the '40 Act in connection with the transactions.

(f) The Plans are not sponsored by the Bank.

(g) A Second Fiduciary who is acting on behalf of each Plan and who

is independent of and unrelated to the Bank, as defined in paragraph

(g) of Section III below, receives in advance of the investment by the

Plan in any of the Funds a full and detailed written disclosure of

information concerning such Fund (including, but not limited to, a

current prospectus for each portfolio of each of the Funds in which

such Plan is considering investing and a statement describing the fee

structure).

(h) On the basis of the information described in paragraph (g) of

this Section II, the Second Fiduciary authorizes in writing the

investment of assets of the Plans in shares of the Funds and the fees

received by the Bank in connection with its services to the Funds. Such

authorization by the Second Fiduciary is consistent with the

responsibilities obligations, and duties imposed on fiduciaries by Part

4 of Title I of the Act.

(i) The authorization, described in paragraph (h) of this Section

II, is terminable at will by the Second Fiduciary of a Plan, without

penalty to such Plan. Such termination will be effected by the Bank

selling the shares of the Fund held by the affected Plan within one

business day following receipt by the Bank, either by mail, hand

delivery, facsimile, or other available means at the option of the

Second Fiduciary, of the termination form (the Termination Form), as

defined in paragraph (i) of Section III below, or any other written

notice of termination; provided that if, due to circumstances beyond

the control of the Bank, the sale cannot be executed within one

business day, the Bank shall have one additional business day to

complete such redemption.

(j) Plans do not pay any Plan-level investment management fees,

investment advisory fees, or similar fees to the Bank with respect to

any of the assets of such Plans which are invested in shares of any of

the Funds. This condition does not preclude the payment of investment

advisory fees or similar fees by the Funds to the Bank under the terms

of an investment advisory agreement adopted in accordance with section

15 of the '40 Act or other agreement between the Bank and the Funds.

(k) In the event of an increase in the rate of any fees paid by the

Funds to the Bank regarding any investment management services,

investment advisory services, or fees for similar services that the

Bank provides to the Funds over an existing rate for such services that

had been authorized by a Second Fiduciary, in accordance with paragraph

(h) of this Section II, the Bank will, at least 30 days in advance of

the implementation of such increase, provide a written notice (which

may take the form of a proxy statement, letter, or similar

communication that is separate from the prospectus of the Fund and

which explains the nature and amount of the increase in fees) to the

Second Fiduciary of each of the Plans invested in a Fund which is

increasing such fees. Such notice shall be accomplained by the

Termination Form, as defined in paragraph (i) of Section III below.

(1) In the event of an addition of a Secondary Service, as defined

in paragraph (h) of Section III below, provided by the Bank to the Fund

for which a fee is charged or an increase in the rate of any fee paid

by the Funds to the Bank for a Secondary Service, as defined in

paragraph (h) of Section III below, that results either from an

increase in the rate of such fee or from the decrease in the number or

kind of services performed by the Bank for such fee over an existing

rate for such Secondary Service which had been authorized by the Second

Fiduciary of a Plan, in accordance with paragraph (h) of this Section

II, the Bank will at least 30 days in advance of the implementation of

such additional service for which a fee is charged or fee increase,

provide a written notice (which may take the form of a proxy statement,

letter, or similar communication that is separate from the prospectus

of the Fund and which explains the nature and amount of the additional

service for which a fee is charged or the nature and amount of the

increase in fees) to the Second Fiduciary of each of the Plans invested

in a Fund which is adding a service or increasing fees. Such notice

shall be accompanied by the Termination Form, as defined in paragraph

(i) of Section III below.

(m) The Second Fiduciary is supplied with a Termination Form at the

times specified in paragraphs (k), (l), and (n) of this Section II,

which expressly provides an election to terminate the authorization,

described above in paragraph (h) of this Section II, with instructions

regarding the use of such Termination Form including statements that:

(1) The authorization is terminable at will by any of the Plans,

without penalty to such Plans. Such termination will be effected by the

Bank redeeming shares of the Fund held by the Plans requesting

termination within one business day following receipt by the Bank,

either by mail, hand delivery, facsimile, or other available means at

the option of the Second Fiduciary, of the Termination Form or any

other written notice of termination; provided that if, due to

circumstances beyond the control of the Bank, the redemption of shares

of such Plans cannot be executed within one business day, the Bank

shall have one additional business day to complete such redemption; and

(2) Failure by the Second Fiduciary to return the Termination Form

on behalf of a Plan will be deemed to be an approval of the additional

Secondary Service for which a fee is charged or increase in the rate of

any fees, if such Termination Form is supplied pursuant to paragraphs

(k) and (l) of this Section II, and will result in the continuation of

the authorization, as described in paragraph (h) of this Section II, of

the Bank to engage in the transactions on behalf of such Plan.

(n) The Second fiduciary is supplied with a Termination Form,

annually during the first quarter of each calendar year, beginning with

the first quarter of the calendar year that begins after the date this

exemption is published in the Federal Register and continuing for each

calendar year thereafter; provided that the Termination Form need not

be supplied to the Second Fiduciary, pursuant to paragraph (n) of this

Section II, sooner than six months after such Termination Form is

supplied pursuant to paragraphs (k) and (l) of this Section II, except

to the extent required by said paragraphs (k) and (l) of this Section

II to disclose an additional Secondary Service for which a fee is

charged or an increase in fees.

(o)(1) With respect to each of the Funds in which a Plan invests,

the Bank will provide the Second Fiduciary of such Plan:

(A) At least annually with a copy of an updated prospectus of such

Fund;

(B) Upon the request of such Second Fiduciary, with a report or

statement (which may take the form of the most

[[Page 3481]]

recent financial report, the current statement of additional

information, or some other written statement) which contains a

description of all fees paid by the Fund to the Bank; and

(2) With respect to each of the Funds in which a Plan invests, in

the event such Fund places brokerage transactions with the Bank, the

Bank will provide the Second Fiduciary of such Plan at least annually

with a statement specifying:

(A) The total, expressed in dollars, brokerage commissions of each

Fund's investment portfolio that are paid to the Bank by such Fund;

(B) The total, expressed in dollars, of brokerage commissions of

each Fund's investment portfolio that are paid by such Fund to

brokerage firms unrelated to the Bank;

(C) The average brokerage commissions per share, expressed as cents

per share, paid to the Bank by each portfolio of a Fund; and

(D) The average brokerage commissions per share, expressed as cents

per share, paid by each portfolio of a Fund to brokerage firms

unrelated to the Bank.

(p) All dealings between the Plans and any of the Funds are on a

basis no less favorable to such Plans than dealings between the Funds

and other shareholders holding the same class of shares as the Plans.

(q) The Bank maintains for a period of 6 years the records

necessary to enable the persons, as described in paragraph (r) of

Section II below, to determine whether the conditions of this proposed

exemption have been met, except that:

(1) A prohibited transaction will not be considered to have

occurred if, due to circumstances beyond the control of the Bank, the

records are lost or destroyed prior to the end of the 6 year period;

and

(2) No party in interest, other than the Bank, shall be subject to

the civil penalty that may be assessed under section 502(i) of the Act,

or to the taxes imposed by section 4975 (a) and (b) of the Code, if the

records are not maintained, or are not available for examination as

required by paragraph (r) of Section II below;

(r)(1) Except as provided in paragraph (r)(2) of this Section II

and notwithstanding any provisions of subsection (a)(2) and (b) of

section 504 of the Act, the records referred to in paragraph (q) of

Section II above are unconditionally available at their customary

location for examination during normal business hours by--

(i) Any duly authorized employee or representative of the

Department, the Internal Revenue Service (the Service) or the

Securities and Exchange Commission (the SEC);

(ii) Any fiduciary of each of the Plans who has authority to

acquire or dispose of shares of any of the Funds owned by such a Plan,

or any duly authorized employee or representative of such fiduciary;

and

(iii) Any participant or beneficiary of the Plans or duly

authorized employee or representative of such participant or

beneficiary;

(2) None of the persons described in paragraph (r)(1)(ii) and

(r)(1)(iii) of Section II shall be authorized to examine trade secrets

of the Bank, or commercial or financial information which is privileged

or confidential.

Section III. Definitions

For purposes of this exemption,

(a) The term ``Bank'' means First Hawaiian Bank and any affiliate

of the Bank, as defined in paragraph (b) of this Section III.

(b) An ``affiliate'' of a person includes:

(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 ``Fund or Funds'' means any diversified open-end

investment company or companies registered under the '40 Act for which

the Bank serves as investment adviser, and may also provide custodial

or other services as approved by such Funds.

(e) 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 a Fund's prospectus

and statement of additional information, and other assets belonging to

each of the portfolios in such Fund, less the liabilities charged to

each portfolio, by the number of outstanding shares.

(f) The term ``relative'' means a ``relative'' as that term is

defined in section 3(15) of the Act (or a ``member of the family'' as

that term is defined in section 4975(e)(6) of the Code), or a brother,

a sister, or a spouse of a brother or a sister.

(g) The term ``Second Fiduciary'' means a fiduciary of a plan who

is independent of and unrelated to the Bank. For purposes of this

exemption, the Second Fiduciary will not be deemed to be independent of

and unrelated to the Bank if:

(1) Such Second Fiduciary directly or indirectly controls, is

controlled by, or is under common control with the Bank;

(2) Such Second Fiduciary, or any officer, director, partner,

employee, or relative of such Second Fiduciary is an officer, director,

partner, or employee of the Bank (or is a relative of such persons);

(3) Such Second Fiduciary directly or indirectly receives any

compensation or other consideration for his or her own personal account

in connection with any transaction described in this proposed

exemption.

If an officer, director, partner, or employee of the Bank (or a

relative of such persons), is a director of such Second Fiduciary, and

if he or she abstains from participation in (i) the choice of the

Plan's investment manager/adviser, (ii) the approval of any purchase or

redemption by the Plan of shares of the Funds, and (iii) the approval

of any change of fees charged to or paid by the Plan, in connection

with any of the transactions described in Sections I and II above, then

paragraph (g)(2) of Section III above, shall not apply.

(h) The term ``Secondary Service'' means a service, other than an

investment management, investment advisory, or similar service, which

is provided by the Bank to the Funds, including but not limited to

custodial, accounting, brokerage, administrative, or any other service.

(i) The term ``Termination Form'' means the form supplied to the

Second Fiduciary, at the times specified in paragraphs (k), (l), and

(n) of Section II above, which expressly provides an election to the

Second Fiduciary to terminate on behalf of the Plans the authorization,

described in paragraph (h) of Section II. Such Termination Form may be

used at will by the Second fiduciary to terminate such authorization

without penalty to the Plans and to notify the Bank in writing to

effect such termination by redeeming the shares of the Fund held by the

Plans requesting termination within one business day following receipt

by the Bank, either by mail, hand delivery, facsimile, or other

available means at the option of the Second Fiduciary, of written

notice of such request for termination; provided that if, due to

circumstances beyond the control of the Bank, the redemption cannot be

executed within one business day, the Bank shall have one additional

business day to complete such redemption.

[[Page 3482]]

Written Comments

The Department received two written comments with respect to the

proposed exemption and no requests for a public hearing. The comments

were submitted by the Bank and concerned clarifications to the Summary

of Facts and Representations of the proposed exemption and notification

of interested persons. Following is a discussion of the applicant's

comments.

1. Clarifications to the Proposed Exemption

a. The Bank notes that the word ``Pooled'' should be inserted in

Representation #1c. before the words ``Equity Fund'' in the last line

of the middle column of page 47601.

b. The Bank explains that in Representation #3, the word ``close,''

appearing in the fourth line of the last paragraph of the right column

on page 47602, should be replaced with the word ``opening.'' As

described in Representation #3 of the proposed exemption (see page

47603, the last paragraph of the left column, carrying over to the top

of the middle column, and the last paragraph of the middle column), the

Bank asserts that the transferred assets are valued as of the ``CIF

Valuation Date,'' which is the close of business on the last business

day prior to the date of transfer to the Funds. The transfer of the

assets so valued is made to the Funds before the opening of business on

the transfer date. Before the opening of business, the Bank further

explains that the assets will have the same value as determined at the

CIF Valuation Date, and the shares of the corresponding Funds will have

the same value as the assets transferred. By the close of business on

the transfer date, the Bank points out that the assets transferred in-

kind to a Fund may change in value (i.e., increase or decrease) from

the CIF Valuation Date, and thus the aggregate value of the

corresponding fund may also change between opening and closing of

business on the transaction date.

c. The Bank explains that the following language should be added

after the words ``Bishop Street Funds'' in the eight line of

Representation #4 on page 47603: ``in exchange for an appropriate

number of shares of certain portfolios of the Bishop Street Funds.''

2. Notification of Interested Persons

Due to unavoidable delays and an error in the dates specified in

its first notice, the Bank explains that it renotified all interested

persons on or before November 13, 1995. In the second notice, the Bank

indicates that it gave interested persons an extension of the comment

period until December 15, 1995 which was more than 30 days from the

mailing date of the second notice. As a result of the extended comment

period, no further comments were received by the Department.

After giving full consideration to the entire record, including the

written comments, the Department has decided to grant the exemption as

clarified and modified above. The comment letters have been included as

part of the public record of the exemption application. The complete

application file, including all supplemental submissions received by

the Department, is made available for public inspection in the Public

Documents Room of the Pension and Welfare Benefits Administration, Room

N-5638, 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 of proposed exemption published on September 13, 1995 at 60

FR 47598.

FOR FURTHER INFORMATION CONTACT: Ms. Jan D. Broady of the Department,

telephone (202) 219-8881. (This is not a toll-free number.)

The Chase Manhattan Bank (National Association) Pooled Investment Trust

for Employee Benefit Plans (the Trust) Located in New York, New York

[Prohibited Transaction Exemption 96-2; Exemption Application No. D-

9983]

Exemption

The restrictions of sections 406(a) 406(b)(1) and 406(b)(2) of the

Act and the sanctions resulting from the application of section 4975 of

the Code, by reason of section 4975(c)(1) (A) through (E) of the Code,

shall not apply to the past cash sale of certain commercial paper notes

(the Notes) for $25,129,748 by two collective investment funds in the

Trust known as VAN 1 and VAN 18 (the VANs) to The Chase Manhattan Bank,

N.A. (the Bank), a party in interest with respect to the employee

benefit plans invested in the VANs at the time of the transaction;

provided the following conditions were met:

(a) The sale of each of the Notes was a one-time cash transaction;

(b) The terms and conditions of the sale were at least as favorable

to the VANs as those obtainable in an arm's-length transaction with an

unrelated party;

(c) The VANs received an amount for the Notes that was equal to the

greater of: (i) In the case of a Note that had a scheduled maturity

after the date of the transaction, the original purchase price paid by

the particular VAN for the Note plus interest at the imputed yield to

maturity up to the date of sale, as calculated by the Bank; (ii) in the

case of a Note that had a scheduled maturity on or before the date of

the transaction, the value at maturity plus additional interest to the

date of sale at the daily rates earned by the related VAN (exclusive of

its holdings of the Notes) from the maturity date to the date of sale;

or (iii) the fair market value of each Note as of the time of sale as

determined by an independent, qualified appraiser;

(d) The VANs did not pay any commissions, costs or other expenses

in connection with the sale of the Notes;

(e) If the exercise of any of the Bank's rights, claims or causes

of action in connection with its ownership of the Notes results in the

Bank recovering from the issuer of the Notes, or any third party, an

aggregate amount that is more than the purchase price paid to the VANs

by the Bank for the Notes (i.e. $25,129,748), the Bank will pay such

excess amounts to the respective VANs within thirty (30) days of the

receipt of such recovery amounts; and

(f) Each employee benefit plan with interests in the VANs received

its proportionate share of the proceeds of the sale of the Notes to the

Bank and receives its proportionate share of any recovery amounts

obtained on the Notes in excess of the purchase price received by the

VANs, as described in condition (e) above.

EFFECTIVE DATE: This exemption is effective as of December 19, 1994.

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 17, 1995, at 60

FR 53806.

FOR FURTHER INFORMATION CONTACT: Mr. E. F. Williams of the Department,

telephone (202) 219-8194. (This is not a toll-free number.)

Retirement Plan for Employees of Concord Hospital Capital Region

Healthcare Corp. (the Plan) Located in Concord, New Hampshire

[Prohibited Transaction Exemption 96-3; Exemption Application No. D-

10027]

Exemption

The restrictions of section 406 (b)(1) and (b)(2) of the Act and

the sanctions resulting from application of section 4975 of the Code,

by reason of section 4975(a)(1) (A) through (E) of the Code, shall not

apply to: (1) The July 7, July 13, July 18, August 19, and August 22,

1994, transfers to the Plan of $7,376,039

[[Page 3483]]

of publicly--traded securities from non-ERISA accounts (the Accounts)

of Concord Hospital, Inc. and its parent corporation, Capital Region

Health Care Corporation; (2) the transfer of $3,761,319 of publicly-

traded securities from the Plan to the Accounts in August of 1994; and

(3) the proposed transfer of approximately $3.6 million from the Plan

to the Accounts, provided the following conditions are satisfied: (a)

The decision for the Plan to enter the subject transactions was made at

the recommendation of the Plan's independent investment advisor; (b)

the Plan has not paid and will not pay commissions or other fees in

connection with the subject transactions; (c) the transactions involve

publicly-traded securities, the fair market values of which were based

upon published prices on established markets; and (d) the Plan's

independent fiduciary has reviewed the transactions and has determined

that the transactions were in the best interest of the Plan and

protective of the rights of the participants and beneficiaries of the

Plan.

For a more complete statement of the facts and representations

supporting the Department's decision to grant this exemption, refer to

the notice of proposed exemption published on November 3, 1995 at 60 FR

55857.

EFFECTIVE DATE: This exemption is effective July 7, 1994.

FOR FURTHER INFORMATION CONTACT:

Gary H. Lefkowitz of the Department, telephone (202) 219-8881. (This is

not a toll-free number.)

Larson Distributing Co. Profit Sharing Plan (the Plan) Located in

Denver, Colorado

[Prohibited Transaction Exemption 96-4; Exemption Application No. D-

10083]

Exemption

The restrictions of section 406(a), 406 (b)(1) and (b)(2) of the

Act and the sanctions resulting from the application of section 4975 of

the Code, by reason of section 4975(c)(1) (A) through (E) of the Code,

shall not apply to (1) the extension of credit to the Plan (the Loan)

by Larson Distributing Co., Inc. (the Employer), the sponsor of the

Plan, with respect to the Plan's investments in annuity accounts

maintained with USG Annuity and Life Co. and All American Life

Insurance Company (the Annuities), and (2) the Plan's potential

repayment of the Loan (the Repayments); provided the following

conditions are satisfied:

(A) The Plan does not pay any interest or incur any expenses with

respect to the Loan;

(B) The Repayments are restricted solely to the amounts recovered

by the Employer on behalf of the Plan (the Recovery Amounts) in

litigation concerning the Annuities; and

(C) To the extent that Loan exceeds the total Recovery Amounts, the

Repayments shall be waived.

For a more complete statement of the facts and representations

supporting the exemption, refer to the notice of proposed exemption

published on November 3, 1995 at 60 FR 55881.

FOR FURTHER INFORMATION CONTACT: Ronald Willett of the Department,

telephone (202) 219-8881. (This is not a toll-free number.)

Retirement Savings Plan and Trust for Employees of the J.H. Heafner

Company, Inc. (the Plan) Located in Lincolnton, North Carolina

[Prohibited Transaction Exemption 96-5; Exemption Application No. D-

10125]

Exemption

The restrictions of sections 406(a), 406 (b)(1) and (b)(2) of the

Act and the sanctions resulting from the application of section 4975 of

the Code, by reason of section 4975(c)(1) (A) through (E) of the Code,

shall not apply to the sale of the Plan of certain limited partnerships

units (the Units) in two limited partnerships to the J.H. Heafner

Company, Inc. (Heafner), provided the following conditions are

satisfied: (a) The sale is a one-time transaction for cash; (b) the

Plans pays no commissions or other expenses in connection with the

transaction; and (c) the Plan receives no less than the greater of: (1)

Its cost for the Units; or (2) the fair market value of the Units on

the date of the sale.

For a more complete statement of the facts and representations

supporting the Department's decision to grant this exemption, refer to

the notice of proposed exemption published on November 3, 1995 at 60 FR

55862.

FOR FURTHER INFORMATION CONTACT:

Gary H. Lefkowitz of the Department, telephone (202) 219-8881 (This is

not a toll-free number.)

General Information

The attention of interested persons is directed to the following:

(1) The fact that a transaction is the subject of an exemption

under section 408(a) of the Act and/or section 4975(c)(2) of the Code

does not relieve a fiduciary or other party in interest or disqualified

person from certain other provisions to which the exemptions does not

apply and the general fiduciary responsibility provisions of section

404 of the Act, which among other things require a fiduciary to

discharge his duties respecting the plan solely in the interest of the

participants and beneficiaries of the plan and in a prudent fashion in

accordance with section 404(a)(1)(B) of the Act; nor does it affect the

requirement of section 401(a) of the Code that the plan must operate

for the exclusive benefit of the employees of the employer maintaining

the plan and their beneficiaries;

(2) These exemptions are supplemental to and not in derogation of,

any other provisions of the Act and/or the Code, including statutory or

administrative exemptions and transactional rules. Furthermore, the

fact that a transaction is subject to an administrative or statutory

exemption is not dispositive of whether the transaction is in fact a

prohibited transaction; and

(3) The availability of these exemptions is subject to the express

condition that the material facts and representations contained in each

application accurately describes all material terms of the transaction

which is the subject of the exemption.

Signed at Washington, D.C., this 25th day of January 1996.

Ivan Strasfeld,

Director of Exemption Determinations, Pension and Welfare Benefits

Administration.

[FR Doc. 96-1777 Filed 1-30-96; 8:45 am]

BILLING CODE 4510-29-M