Page:United States Statutes at Large Volume 92 Part 3.djvu/157

 PUBLIC LAW 95-600—NOV. 6, 1978

92 STAT. 2789

"(A) a class of securities required to be registered under section 12 of the Securities Exchange Act of 1934, and 15 USC 78/. "(B) a class of securities which would be required to be so registered except for the exemption from registration provided in subsection (g)(2)(H) of such section 12. "(f) PLAN MUST B E ESTABLISHED BEFORE EMPLOYER'S DUE DATE.—

"(1) IN GENERAL.—A plan meets the requirements of this subsection for a plan year only if it is established on or before the due date for the filing of the employer's tax return for the taxable year (including any extensions of such date) in which or with which the plan year ends. "(2) SPECIAL RULE FOR FIRST YEAR.—A plan which otherwise meets the requirements of this section shall not be considered to have failed to meet the requirements of section 401(a) merely 26 USC 401. because it was not established by the close of the first taxable year of the employer for which an ESOP credit is claimed by the employer. "(g) TRANSFERRED AMOUNTS MUST STAY IN PLAN EVEN THOUGH INVESTMENT CREDIT IS REDETERMINED OR RECAPTURED.—A plan meets

the requirement of this subsection only if it provides that amounts which are transferred to the plan (because of the requirements of section 48(n)(l)) shall remain in the plan (and, if allocated under the 26 USC 48. plan, shall remain so allocated) even though part or all of the ESOP credit is recaptured or redetermined. "(h) RIGHT TO DEMAND EMPLOYER SECURITIES; PUT OPTION.—

"(1) IN GENERAL.—A plan meets the requirements of this subsection if a participant who is entitled to a distribution from the plan— "(A) has a right to demand that his benefits be distributed in the form of employer securities, and "(B) if the employer securities are not readily tradable on an established market, has a right to require that the employer repurchase employer securities under a fair valuation formula. "(2) PLAN MAY DISTRIBUTE CASH IN CERTAIN CASES.—A plan which otherwise meets the requirements of this section shall not be considered to have failed to meet the requirements of section 401(a) merely because under the plan the benefits may be distributed in cash or in the form of employer securities, "(i) REIMBURSEMENT FOR EXPENSES OF ESTABLISHING AND ADMINISTERING PLAN.—A plan which otherwise meets the requirements of

this section shall not be treated as failing to meet such requirements merely because it provides that— "(1) EXPENSES OF ESTABLISHING PLAN.—As reimbursement for the expenses of establishing the plan, the employer may withhold from amounts due the plan for the taxable year for which the plan is established (or the plan may pay) so much of the amounts paid or incurred in connection with the establishment of the plan as does not exceed the sum of— "(A) 10 percent of the first $100,000 which the employer is required to transfer to the plan for that taxable year under section 48(n)(l), and "(B) 5 percent of any amount so required to be transferred in excess of the first $100,000; and "(2) ADMINISTRATIVE EXPENSES.—As reimbursement for the expenses of administering the plan, the employer may withhold from amounts due the plan (or the plan may pay) so much of the

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