Register (ACFR) issues a regulation granting it official legal status. )J',^3rieAM7+%n[(PiZZ3'MC1*v In addition, Northwest will provide the Independent Fiduciary with the information required to be provided to its lenders under its credit agreement. corresponding official PDF file on govinfo.gov. If previous valuations or analyses do not comport with these conditions, the Independent Fiduciary must perform any additional work necessary to make the valuations and analyses consistent with the conditions of this exemption. omakase strawberry seeds; marion county impact fees 2021; githens middle school yearbook At the present time, the Board was unable to make this finding. Use the PDF linked in the document sidebar for the official electronic format. Northwest Airlines Pension Plan For Contract Employees. The Independent Fiduciary must ensure that all of the conditions above are satisfied with respect to any past contributions of Pinnacle Stock, as well as any future contributions. 5,105. As a condition of the Proposed Exemption, Fiduciary Counselors, using the services of its independent appraisal firm Eclat, Start Printed Page 49802determined the value of Pinnacle Stock. As of December 31, 2002, 4.3 million shares of Series C Preferred Stock have been converted into Common Stock and the remaining Start Printed Page 498044.8 million shares outstanding are convertible into 6.6 million shares of Common Stock. Except for one director appointed by Northwest, Pinnacle's board is independent of Northwest. These guidelines contemplate that a certain amount of assets will be allocated to securities with risk and return characteristics similar to Pinnacle Stock. Fiduciary Counselors adds that AIC, which remains a subsidiary of Aon, will continue to act as advisor in connection with this engagement. On that day, ALPA, TWUA, NAMA, ATSA and the Company on behalf of its management and non-contract employees exercised the Special Conversion Option, with the IAM and IBT electing not to exercise the Special Conversion Option (63 shares are still owned by the ALPA trust). Several commenters requested that Northwest provide for enhanced communication with the Plan participants concerning the Exemption Transactions. First, the Plans must provide Northwest with an Offer Notice which shall contain an independent valuation of the consideration by a nationally recognized valuation expert acceptable to Fiduciary Counselors and Northwest. Delta - RAA NORTHWEST AIRLINES RETIREMENT Total number of active participants reported on line 7a of the Form 5500. Northwest noted that under the terms of the Omnibus Agreement, Northwest is responsible for making up the difference, if any, between the IPO price and the original contribution value. Based on input from AIC, Eclat then applied a 15 percent liquidity discount and a 5 percent minority discount. Northwest Airlines In valuing the Pinnacle shares, it was necessary to assign a value, not only to Pinnacle, but also to the Put Option. Ms. DuVaney is a participant in the Contract Plan, a defined benefit plan for union members established by Northwest Airlines Corp. in 1970, covering all Northwest responded that no similar legal restriction would apply to the repurchase of Pinnacle Stock pursuant to the exercise of the Put Option. In view of the comments requesting a hearing, on March 11, 2003, the Department published in the Federal Register (68 FR 11589) a notice of hearing on the Proposed Exemption. Northwests filing with the Securities and Exchange Commission says that participants benefits accruals were frozen as of August 31. The Proposed Exemption was requested in an application filed on Start Printed Page 49793behalf of Northwest pursuant to section 408(a) of the Act and section 4975(c)(2) of the Code, and in accordance with the procedures set forth in 29 CFR part 2570, subpart B (55 FR 32836, August 10, 1990). This, together with the reporting planned by Fiduciary Counselors, will permit ALPA to monitor the Independent Fiduciary. The terms of the ASA and related agreements are more favorable to Pinnacle than an arm's length transaction between unrelated parties, and substantially determine and enhance the value of Pinnacle. 2007) Argued and Submitted September Register, and does not replace the official print version or the official Under the Omnibus Agreement, Northwest controls the timing of the IPO until the earlier of July 1, 2006 or the occurrence of an early termination event. Northwest stated that the language at section 5.1(b) of the Omnibus Agreement contains a representation that Northwest has the corporate and legal authority to meet its obligations under the agreement, including the Put Option. Participants and beneficiaries of the Plans benefit from Northwest's improved liquidity and continued viability and competitiveness in the current economic environment. 3. WebHistorically, the Named Executive Officers participated in three defined benefit pension plans the Northwest Airlines Pension Plan for Salaried Employees (the Salaried The Special Conversion Option expired on February 9, 1994. While every effort has been made to ensure that Document Drafting Handbook Moreover, when the IPO of Pinnacle Stock occurs, the Plans may benefit from a potentially significant IPO premium with respect to their holdings of Pinnacle Stock. If the Pinnacle Stock is not publicly traded, the Plans will receive the. Open for Comment, Applications for New Awards-American History and Civics Education National Activities Program, Economic Sanctions & Foreign Assets Control, National Oceanic and Atmospheric Administration, Salmonella in Not-Ready-To-Eat Breaded Stuffed Chicken Products, Authority To Order the Ready Reserve of the Armed Forces to Active Duty To Address International Drug Trafficking, Revitalizing Our Nation's Commitment to Environmental Justice for All, Employee Benefits Security Administration, Valuation in Connection With the Right of First Refusal, Fiduciary Counselors March 5, 2003 Comment, Fiduciary Counselors and Eclat April 25, 2003 Submissions, The Eclat Report and the January 15, 2003 Valuation, Negotiation of the Term Sheet and Omnibus Agreement, The Independent Fiduciary's Determinations, Airline Industry and Northwest Financial Condition, Collateral for Pinnacle Stock Contribution, Northwest May 20 and June 10, 2003 Comment Letters, Fiduciary Counselors' July 11, 2003 Submission, Change of Affiliation of Fiduciary Counselors, Termination of the Independent Fiduciary Agreement, Northwest and ALPA Agreement Regarding Pinnacle Stock, August 6, 2003 Northwest and Independent Fiduciary Response, Enhanced Communication with Plan Participants, https://www.federalregister.gov/d/03-21162, MODS: Government Publishing Office metadata, Current Liability using 6.65% interest rate (IRC 412(l)), Market Value of Assets (with PY02 accrued contributions), Actuarial Value of Assets (with PY02 accrued contributions). that agencies use to create their documents. Number of retired or separated participants receiving benefits. See Omnibus Agreement at section 6.3. Northwest Airlines, Inc. Defined Benefit Master Reliance solely on the valuation provided by the appraiser would not be sufficient to meet this prudence requirement. However, audited 2002 financial statements were not available at the time of Eclat's valuation for the January 15, 2003 contribution. publication in the future. (i) An analysis of Pinnacle's financial condition and earning capacity. The ASA also was revised to eliminate the unilateral right of Northwest to terminate the ASA in the event of the bankruptcy of Northwest. The Department notes that the Preamble to the Proposed Exemption stated that either party may terminate the Independent Fiduciary Agreement for any reason upon 60 days notice and that the Agreement may be terminated immediately for cause. Northwest notes that the Omnibus Agreement, while consistent with the Term Sheet, provides specific terms for: the contribution transactions; transferability of Pinnacle Stock; corporate governance; voting rights; the Put Option; representations and warranties; and a number of other matters. 3. The monthly contributions required to be made to the Pilot Plan pursuant to the pilot collective bargaining agreement are waived for the 2004 and 2005 Plan Year. legal research should verify their results against an official edition of At that time, the Pilot Plan did not participate in the Pinnacle Stock Investment Fund.[4]. (l) An analysis of the market price of securities of corporations engaged in the same or similar lines of business as Pinnacle, which are actively traded on a recognized exchange or automated broker-dealer quotation system. The IF Report represents that, in the January 15, 2003 Valuation, Eclat determined that the net equity value (before discounts) of Pinnacle was $412,923,928.00. In addition, as reflected in the Omnibus Agreement, the Independent Fiduciary has negotiated a lapse of all transfer restrictions on the Pinnacle Stock held by the Plans on July 1, 2006, and upon an Early Termination Event (including a breach of the Omnibus Agreement by Northwest or Pinnacle or Northwest's failure to honor its Put Option obligations, but excluding violations of the scope clause limitations in certain of Northwest's collective bargaining agreements[5] Northwest and ALPA believe that the Letter Agreement also enhances protections for participants in all three Plans by giving the Independent Fiduciary first priority to sell Pinnacle Stock in an IPO where the number of shares sought to be sold exceeds the number that can be sold. The Plan is a defined benefit pension plan for the benefit of certain union-represented employees. See Omnibus Agreement at section 8.8. The terms of the transaction negotiated between the Independent Fiduciary and Northwest were embodied in a Term Sheet, which was provided to the Department on January 10, 2003. A Start Printed Page 49795breach of the Omnibus Agreement by Pinnacle constitutes an Early Termination Event if such breach continues because Northwest fails to exercise its rights as a stockholder to cause the Pinnacle directors to cure the breach or to replace such directors. The details of the Pinnacle Stock contribution were provided in the March 3, 2003 letter. 2004) on CaseMine. The Independent Fiduciary notes that the Proposed Exemption, in the first column of 68 FR 2580 (first full paragraph), makes reference to voting restrictions and limits on the ability of the Plans to dispose of the Pinnacle Stock, except pursuant to an initial public offering (IPO) initiated by Northwest or by exercise of the Put Option. At the time the voluntary contribution is made to the Pilot Plan, Northwest also will contribute Pinnacle Stock to the Salaried Plan in an amount such that the amount of the Pinnacle Stock held by the Salaried Plan equals the required minimum funding contribution due under ERISA and the Code on September 15, 2003. These markup elements allow the user to see how the document follows the and services, go to Air Lines At the conclusion of these deliberations, it was clear that the legal restrictions applicable to stock buy backs under Delaware Law did not permit Northwest to proceed at this time with the buy back of the Series C Preferred Stock. documents in the last year, 931 Ioane John Opeta appeals the district court's judgment that he is not "totally and permanently" disabled, and therefore ineligible for a disability pension benefit under the Northwest Airlines Pension Plan for Contract Employees (the "Plan"), which is administered by Northwest Airlines ("Northwest") and regulated by the Employee In addition, Northwest shall provide it with copies of any amendments to the credit agreement. 04/28/2023, 204 The value of Pinnacle Stock is determined by an independent fiduciary, Fiduciary Counselors, based on the valuation provided by their independent valuation firm, Eclat. Pension Plan Contract Employees The Employee Stock Plan was established through labor negotiations between Northwest and its unions in 1993 to hold contributions of Northwest Airlines Corporation Series C Preferred Stock. The complete Application file, including all supplemental submissions received by the Department, is available for public inspection in the Public Disclosure Room of the Employee Benefits Security Administration, U.S. Department of Labor, Room N-1513, 200 Constitution Avenue, NW., Washington, DC 20210. Webfunny ways to say home run grassroots elite basketball Menu . A comprehensive set of representations and warranties relating to both Pinnacle, Northwest and its affiliates. As noted in the June 27, 2003 letter from Northwest and ALPA to the Department, Northwest states that the Letter Agreement will be executed in connection with the voluntary contribution. travel symbol copy and paste endstream endobj 4 0 obj<> endobj 5 0 obj[/Separation/PANTONE#20368#20C/DeviceCMYK 3 0 R] endobj 6 0 obj<> endobj 7 0 obj<> endobj 9 0 obj<>stream Northwest Response: Northwest notes that it has never before sought a prohibited transaction exemption and has never missed a pension funding payment. The Independent Fiduciary must investigate the facts and assumptions underlying the appraisals to ensure that stock contributions are not valued at more than fair market value. WebRecourse obligation of north carolina; northwest airlines pension plan for contract employees get this defense? The company and labor leaders have been pushing a law change that would give Northwest 20 years to make contributions to three pension plans underfunded by $3.7 billion. Northwest and ALPA assert that the voluntary contribution gives Northwest the liquidity it needs, and thereby the ability to maintain all of its Plans, by eliminating the funding requirement for the Pilot Plan for the 2003 Plan Year, possibly reducing the funding requirements for future plan years, and by waiving the monthly contribution requirement under the pilot collective bargaining agreement for the 2004 and 2005 Plan Years. Finally, Fiduciary Counselors requests that in Section III. Northwest explained that the Omnibus Agreement granted the Plans additional rights in order to protect their interest in the Pinnacle Stock. Such techniques were employed by Fiduciary Counselors and Eclat in this circumstance. [8] This prototype edition of the More information and documentation can be found in our Northwest reported a net loss of $46 million, with operating income of $8 million in the 3rd quarter of 2002. Northwest Retiree Benefit Trust exclusively for Northwest However, because of its liquidity needs, a cash contribution is not a viable alternative. Because the value of the Pinnacle Stock is based on the financial performance of Pinnacle, the Independent Fiduciary reviewed and considered the business of Pinnacle, and the contractual relationship between Pinnacle and Northwest. Northwest has from 30 to 180 days to settle the option. does steven weber have a brother; charlie bears lantern; My Cart. Northwest believes this is the best outcome for all Plan participants and beneficiaries. Scheduling work rules, wages, it grew have calculated the payments based on his potential entitlement to temporary partial disability. In addition, Delaware law would not restrict NWA Corp., a Delaware corporation, from repurchasing the Pinnacle Stock as the guarantor of the Put Option. During the Hearing, the Department asked Northwest to provide information concerning the funded status of the Pilot Plan, Contract Plan and Salaried Plan at the end of 2002. Section 7.2(b) of the Omnibus Agreement requires only that the appointment of a new CEO be approved by a majority of Pinnacle's board (excluding the Northwest Director), and does not make reference to the compensation of Pinnacle's CEO. Fiduciary Counselors and Eclat represent that Eclat was originally retained by PBGC to value Pinnacle and to evaluate the financial viability of Northwest. The Proposed Exemption contemplates both voluntary and required contributions to the Northwest Plans, as did the Application filed by Northwest on November 6, 2002 and the Omnibus Agreement. (Id. on NARA's archives.gov. These tools are designed to help you understand the official document Northwest airlines founded 90 years ago DA.C from www.diecastaircraftforum.com. The Delaware law applicable to the repurchase of the Series C stock requires the Board to make a finding that NWA Corp. has adequate surplus, defined as the net asset value of the corporation in excess of its capital. 4. The Contract Plan, the Salaried Plan and the Pilot Plan will have the same registration rights provided in the Omnibus Agreement dated January 15, 2003 between Pinnacle Airlines Corp., Northwest and Fiduciary Counselors. Northwest asserts that its beliefs in this regard have been independently verified. Until the ACFR grants it official status, the XML This document contains a final exemption issued by the Department of Labor (the Department) from certain prohibited transaction restrictions of the Employee Retirement Income Security Act of 1974 (ERISA or the Act) and from certain taxes imposed by the Internal Revenue Code of 1986 (the Code). northwest airlines pension As noted in the Department's Interpretive Bulletin, 29 CFR 2509.94-3(d) (59 FR 66736, December 28 1994), apart from consideration of the prohibited transaction provisions, plan fiduciaries must determine that acceptance of an in-kind contribution is consistent with ERISA's general standards of fiduciary conduct. Northwest Response: Northwest explains that, while the Proposed Exemption and the Omnibus Agreement negotiated with Fiduciary Counselors do not require collateral, the Proposed Exemption and the Omnibus Agreement include provisions designed to limit the need for collateral. Once all of the Pinnacle Stock in such an account has been liquidated, that subaccount may be dissolved. Northwest will no longer guarantee a minimum operating margin in 2008. In particular, the risk and the liquidity of the Pinnacle Stock were taken into account and are explained in the reports issued by Fiduciary Counselors and Eclat. Eagan, MN 55121-1534.
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