In its determinations, the Independent Fiduciary has also taken into account Northwest's request for a minimum funding waiver with respect to Plan contributions in 2003 and 2004, and considered the likelihood that such waiver will be granted. Accordingly, the fiduciaries of a plan must act prudently, solely in the interest of the plan's participants and beneficiaries, and with a view to the need to diversify plan assets when deciding whether to accept an in-kind contribution. Northwest Airlines Pension Plan for Contract Northwest believes this is the best outcome for all Plan participants and beneficiaries. Northwest Airlines Pension Plan For Contract Employees Official Publications from the U.S. Government Publishing Office. 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. For example, the Plans obtained a Put Option, corporate governance rights, voting rights in Pinnacle and the right to initiate an IPO or sale of Pinnacle Stock. The Independent Fiduciary must prudently determine the fair market value of the Pinnacle Stock as of the date it is contributed to the Plans. The 4.48% discount represents what Eclat used for Pinnacle's pre-tax cost of debt (9.6%) adjusted for a six-month period. In addition, Northwest shall provide it with copies of any amendments to the credit agreement. Fiduciary Counselors notes that under section 404(a)(1) of ERISA, a fiduciary must discharge its duties with respect to a plan solely in the interest of plan participants and beneficiaries. In addition, Fiduciary Counselors negotiated comprehensive voting and governance rights specifically for the Plans under the Omnibus Agreement. documents in the last year, by the National Oceanic and Atmospheric Administration schneider funeral home mt vernon in obituaries northwest airlines pension information. 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. This is primarily due to the fact that Southwest Airlines does not serve 2 of the 3 Northwest hubsMemphis (Pinnacle's largest market) and Minneapolis. endstream endobj 10 0 obj[/Separation/PANTONE#20186#20C/DeviceCMYK 9 0 R] endobj 11 0 obj<> endobj 12 0 obj<>stream Based on the Eclat and AIC valuations, the Independent Fiduciary determined that the contribution of 1,938,000 shares of Pinnacle Stock should be valued at $43,821,894 as of January 15, 2003, the date the contribution occurred. In addition, under the Agreements, the trustee of each plan was given a one time Special Conversion Option that, if elected, resulted in the relevant trusts receiving Common Stock at the rate of 1.9096 shares of Common Stock for each share of the Series C Preferred Stock that they would have otherwise received. 04/28/2023, 39 The Initial Contribution was comprised of 1,819,833 shares valued at $22.61 per share. A federal judge has denied dismissal of a lawsuit in which five former employees of Delta Air Lines allege Delta and its administrative committee improperly The notice also invited interested persons to submit comments on the proposed exemption and/or to request that a public hearing be held. The Plan - exNWA.com Northwest Airlines Pension Plan For Contract Employees Northwest Airlines Employee Benefit: Pension Plan Plan See Omnibus Agreement at section 9.1(d). Until the Series C stock is repurchased, each share will accrue a 12% per year dividend on the $46.96 per share buy back price. As described in the Proposed Exemption, the current provisions of the Pilot Plan and the pilot collective bargaining agreement prohibit the Pilot Plan from acquiring or holding employer securities. In addition, Delaware law would not restrict NWA Corp., a Delaware corporation, from repurchasing the Pinnacle Stock as the guarantor of the Put Option. daily Federal Register on FederalRegister.gov will remain an unofficial The requirement (detailed in the last bullet point in the second column of the Proposed Exemption at 68 FR 2585) that Plan shares of Pinnacle Stock be voted in favor of certain corporate actions is now set to expire upon the occurrence of an Early Termination Event. Northwest Retiree Benefit Trust exclusively for Northwest 4. These tools are designed to help you understand the official document 2007) Argued and Submitted September The Contract ALPA and Northwest informed the Department that the Letter Agreement will be executed by the parties in connection with a proposed voluntary contribution of Pinnacle Stock (described below). Create an Account and Draft a QDRO for This Plan. Web1. Northwest Airlines Northwest asserts that it couldn't make this representation if there were restrictions that limited its ability to honor the Put Option or other aspects of the Omnibus Agreement and this representation was the product of the negotiations between the Independent Fiduciary and Northwest (as noted above). The Term Sheet formed the basis for the Omnibus Agreement, which was executed on January 15, 2003, after the Independent Fiduciary received confirmation from the Department that the Proposed Exemption had been issued. If you are eligible, the Plan can provide a benefit toyou when you retire and even continue a benefit to yourspouse or offers a preview of documents scheduled to appear in the next day's Registration rights and Plan director's rights preserve the value of the Pinnacle Stock while held by the Plans. 2009-01-01. Any decision not to use all Available Cash to effect such partial purchases must be approved by a majority of the directors elected by the holders of the Series C Preferred Stock. Lastly, the Department notes that the above described responsibilities to be undertaken by the Independent Fiduciary are material factors in the Department's determination to grant a final exemption. WebLarkin are participants in the Northwest Airlines Pension Plan for Contract Employees and also worked for the airline during the class period. Northwest states that, in this regard, some refinements were made to the provisions of the Term Sheet when the parties negotiated and entered into the final Omnibus Agreement (executed on January 15, 2003). He also filed a claim for long-term disability benefits under Northwest Airlines Long Term Disability Plan ("LTD Plan"). WebThe Plan provides that Northwest will determine whether the employee is totally and permanently disabled based on the employee's medical reports. Northwest Response: Northwest notes that like other major airlines, Northwest is in a temporary period of extraordinary airline revenue weakness and volatility. Equally important, Fiduciary Counselors negotiated for special rights associated with the Plans' acquisition of Pinnacle Stock that limit the risks associated with Pinnacle Stock. Webfunny ways to say home run grassroots elite basketball Menu . The Department also questioned whether such restrictions would similarly preclude Northwest from honoring the Put Option. QDRO Preparation for NORTHWEST AIRLINES RETIREMENT 7. Northwest states, as noted in the Proposed Exemption, that the Master Trust is established in a manner such that all Plans hold an undivided and commingled interest in the assets of the Trust. In this environment, it is necessary to maintain high liquidity reserves to ensure the viability of the airline and protect the long-term interests of the pension plans and plan participants. (c) The term control means the power to exercise a controlling influence over the management or policies of a person other than an individual. For purposes of this exemption, a fiduciary will not be deemed to be independent of and unrelated to Northwest if: (1) Such fiduciary directly or indirectly controls, is controlled by or is under common control with Northwest, (2) such fiduciary directly or indirectly receives any compensation or other consideration in connection with any transaction described in this exemption; except that an independent fiduciary may receive compensation for acting as an independent fiduciary from Northwest in connection with the transactions contemplated herein if the amount or payment of such compensation is not contingent upon or in any way affected by the independent fiduciary's ultimate decision, and (3) the annual gross revenue received by such fiduciary, during any year of its engagement, from Northwest and its affiliates exceeds 5 percent (5%) of the independent fiduciary's annual gross revenue from all sources for its prior tax year. northwest airlines pension (Pinnacle Stock) to the Plans by Northwest Airlines, Inc. (Northwest), a party in interest with respect to such Plans; (2) the holding of the Pinnacle Stock by the Plans; (3) the sale of the Pinnacle Stock by the Plans to Northwest; (4) the acquisition, holding, and exercise by the Plans of a put option (the Put Option) granted to the Plans by Northwest; and (5) the guaranty to the Plans by Northwest Airlines Corporation (NWA Corp.) of Northwest's obligation to honor the Put Option (the Exemption Transactions). On February 14, 2003, Northwest obtained formal written confirmation from the bank lenders that none of the rights afforded to the Plans in the Omnibus Agreement nor the exercise of such rights would violate the Credit Agreement. UNITED STATES DISTRICT COURT SOUTHERN 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. In 2008, the target operating margin will be reset to a market-based percentage, but it will be no less than 10 percent and no higher than 14 percent. WebPortuguese products available Online we mail to all lower 48 states. NWA is the plan administrator and the employer plan sponsor 484 F3d 1211 Opeta v. Northwest Airlines Pension Plan for All transactions involving the Plans in connection with the contribution of Pinnacle shares will be no less favorable to the Plans than arm's length transactions involving unrelated parties. In negotiating the terms of the Contributions and determining whether to accept the Initial Contribution, the Independent Fiduciary, with its financial advisors and legal counsel, reviewed those documents that it deemed relevant, participated in meetings and telephone conferences with officers and other representatives of Northwest, and considered aspects of the Contribution that it deemed pertinent to its engagement, including without limitation Northwest's current and future ability to honor the Put Option. Each Plan's percentage ownership reflects the relative size of each Plan to each other. The exemption affects participants and beneficiaries of, and fiduciaries with respect to, the Plans. However, Northwest understands that some of United's airline services agreements have been renegotiated and that it has been reported that the airline services agreement between United and Atlantic Coast Airlines is the subject of current negotiations. Both the Minnesota law and the Delaware law relate to the repurchase of the stock issued by Northwest Airlines, Inc. and NWA Corp., respectively, and would not apply to the repurchase of stock of Pinnacle (the Pinnacle Stock). These modifications and the major comments are discussed below. The exemption permits: (1) The in-kind contribution(s) of the common stock of Pinnacle Airlines Corp.[1] 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. case no. does steven weber have a brother; charlie bears lantern; My Cart. Eclat was provided with Pinnacle's audited financial statements for the years 2000 and 2001. The ASA also was revised to eliminate the unilateral right of Northwest to terminate the ASA in the event of the bankruptcy of Northwest. Wall Street analysts also look favorably on ExpressJet, the Continental Airlines regional airline partner. Additionally, Northwest notes that the Letter Agreement between Northwest and ALPA relating to a voluntary contribution of Pinnacle Stock would provide ALPA with a role in reviewing and approving the termination, and any replacement, of the independent fiduciary. Additionally, Northwest will maintain a subaccount for each Plan within the Master Trust for so long as that Plan holds Pinnacle Stock. The Plan is a defined benefit pension plan for the benefit of certain union-represented employees. The ASA was revised to provide that the acquisition or disposition of shares of Pinnacle Stock pursuant to the terms of the Omnibus Agreement does not constitute a Change of Control (as defined in the ASA). This, together with the reporting planned by Fiduciary Counselors, will permit ALPA to monitor the Independent Fiduciary. Fiduciary Counselors stated that Eclat's valuation took into account a variety of financial data. This Section requires that all revenue flying for Northwest and its affiliates must be performed by pilots on the integrated Pilots System Seniority List in accordance with the collective bargaining agreement, except for revenue flying by an airline that at all times operates only aircraft that are certified with a maximum passenger capacity of 60, and a maximum gross takeoff weight of less than 70,000 pounds. This additional contribution was agreed upon as a result of a technical concern raised by Fiduciary Counselors regarding covenants in Northwest's $1.125 billion Credit and Guarantee Agreement dated October 24, 2000, as amended under which Northwest is the borrower (the Credit Agreement), with Northwest's bank lenders. Northwest airlines founded 90 years ago DA.C from www.diecastaircraftforum.com. Northwest noted that, as is the case for sponsors of defined benefit plans, Northwest has adopted investment guidelines and asset allocation strategies that guide the investment of the Plans' assets. 4 of 1978 (5 U.S.C. Northwest Airlines: Employee Benefits and Perks | Glassdoor In addition to determining the value of Pinnacle Stock at the time of a proposed contribution, the Independent Fiduciary will provide an annual written valuation of the per share value of all Pinnacle Stock held by the Plans as of each December 31 and at any time the Independent Fiduciary exercises the Put Option described below. Any remaining Pinnacle stock will then be contributed to the Contract Plan. Fiduciary Counselors states that the Omnibus Agreement provides: Fiduciary Counselors stated that, in conjunction with Northwest's contribution of Pinnacle stock to the Plans, Northwest has provided the Plans with a Put Option to protect them from a possible decline in Pinnacle's shares' value. The details of the Pinnacle Stock contribution were provided in the March 3, 2003 letter. Northwest Airlines, Inc.Current Liability Funded Status at January 1, 2003. This exemption is effective as of January 15, 2003. The IF Report notes that the Independent Fiduciary drew upon the resources of its affiliate, Aon Investment Counseling, Inc. (AIC), to assist it in its financial analysis and valuation of the Pinnacle Stock. northwest airlines pension information 04/28/2023, 153 There was no question that James was eligible to Fiduciary Counselors notes that there will be no change in its providing objective and independent investment management. [7] If the employee In this regard, section 11.3(b) of the Omnibus Agreement now provides that at the request of a majority of Pinnacle's independent directors, a fairness opinion will be obtained from an investment bank respecting certain Affiliate Transactions. Delta Air Lines accused of incorrect pension benefit calculations In addition, the fiduciary obligation to act prudently requires, at a minimum, that the independent fiduciary conduct an objective, thorough, and analytical critique of the valuation. At that time, the Pilot Plan did not participate in the Pinnacle Stock Investment Fund.[4]. The President of the United States communicates information on holidays, commemorations, special observances, trade, and policy through Proclamations. The valuation prepared by Eclat took into consideration current industry conditions. WebNORTHWEST AIRLINES INC. 2700 Lone Oak Pkwy. Northwest ended the 3rd quarter with over $2.5 billion in cash and short-term receivables. In this regard, section 404(a)(1)(A) and (B) of ERISA requires that fiduciaries discharge their duties to a plan solely in the interests of the participants and beneficiaries, for the exclusive purpose of providing benefits to participants and beneficiaries and defraying reasonable administrative expenses, and with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims. In this regard, as long as the Plans hold at least 5 percent of the Pinnacle Stock, the Plans will have the right to designate one nominee to Pinnacle's board of directors, and Northwest will vote the Series A Preferred Share held by it in favor of such designee. Eagan, MN 55121-1534. Northwest Response: Northwest notes that it has never before sought a prohibited transaction exemption and has never missed a pension funding payment. Webthe Northwest Airlines Pension Plan for Contract Employees (Collectively, the Plans) Located in Eagan, MN AGENCY: Pension and Welfare Benefits Administration, Department of Labor. Alternatively, Northwest may arrange for the stock to be purchased by a third party. Similar considerations will be taken into account by Fiduciary Counselors in determining whether to accept any future contribution of Pinnacle Stock. Finally, Fiduciary Counselors requests that in Section III. by the Education Department Archived News Release Caution: Information may be out of date. Northwest Airlines Pension Plan For Contract Employees. Any change to the ASA, including any early termination of the ASA by Pinnacle, must be approved by a majority of Pinnacle's independent directors, which majority must include the director designated by the Plans. The result was a net value of $339,178,820.00 for the purposes of determining the value of the stock contributed on January 15, 2003. (n) An analysis of the degree to which actual control (both in form and in substance) will pass to any of the Plans as a result of any of the contemplated transactions, (o) To the extent that Pinnacle's current or projected revenues and expenses are related to, or dependent upon, contracts, agreements, or understandings between Northwest and Pinnacle, an analysis of Northwest's financial condition, the likelihood of a Northwest bankruptcy, and the potential impact of a Northwest bankruptcy on those contracts, agreements, or understandings, and on the market value of Pinnacle Stock, and. 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] As a result of instructions given to State Street, after the contribution was made to the Investment Fund, the Contract Plan owns 83.5% of the Investment Fund, while the Salaried Plan owns 16.5% of the Investment Fund. We want to do so as soon as possible. However, if Pinnacle has not yet consummated the IPO by the date that would otherwise be the closing date, Northwest will have the right to defer such closing date for up to 150 days, depending on Northwest's liquidity. Similarly, subparagraph (iii) at 68 FR 2580 should reflect that, after an IPO, the Plans will be entitled to the greatest of the value of the stock at the time of the contribution, or the average of the closing price for the Pinnacle Stock on the public market for the 10 trading days (or such other number if fewer than 10) preceding the exercise date, or as of the last trading day before the closing date of the Put Option. Southwest has a small operation in Detroit with only 2 gates. does steven weber have a brother; charlie bears lantern; My Cart. See Omnibus Agreement at section 6.2. (g) a description of the nature of Pinnacle's business and history. Airline Employee's ERISA Claims Precluded by RLA The Application pertaining to the exemption, the Proposed Exemption, the comments submitted to the Department and the responses to the comments, the transcript of the Hearing, and all other documents submitted to the Department concerning this exemption have been included as part of the public record of the Application.
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