Sec. 7. employee stock ownership plan

699 words·~3 min read·/statute-compilations/comps-1339/sec-7

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## Sec. 7 employee stock ownership plan ###

(a)No guarantee or commitment to guarantee any loan may be made under this Act until the Chrysler Corporation, in a written agreement with the Board which is satisfactory to the Board, agrees— ####

(1)to establish a trust which forms part of an employee stock ownership plan meeting the requirements of subsection (c); ####

(2)to make employer contributions to such trust in accordance with such plan; and ####

(3)to issue additional shares of qualified common stock at such times as such shares are required to be contributed to such trust. ###

(b)No guarantee or commitment to guarantee any loan may be made under this Act after the close of the one hundred and eighty-day period beginning on the date of the enactment of this Act unless the Chrysler Corporation has established a trust which forms part of an employee stock ownership plan meeting the requirements of subsection (c). ###

(c)An employee stock ownership plan meets the requirements of this subsection only if— ####

(1)such plan is maintained by the Chrysler Corporation; ####

(2)such plan satisfies the requirements of section 4975(e)(7) of the Internal Revenue Code of 1954 (determined without regard to subparagraph

(A)of section 410(b)(2) of such Code); ####

(3)such plan provides that— #####

(A)employer contributions to the trust may be made only in accordance with requirements of subsection (d); #####

(B)each participant in the plan has a nonforfeitable right to the participant's accrued benefit under the plan; #####

(C)each employer contribution to the trust shall be allocated in equal amounts (to the extent not inconsistent with the requirements of section 415(c) of such Code) to the accounts of all participants in the plan; and #####

(D)distributions from the trust under the plan will be made in accordance with the requirements of section 401(k)(2)(B) of the Internal Revenue Code of 1954; and ####

(4)such plan benefits 90 percent or more of all employees of the Corporation, excluding the employees who have not satisfied the minimum wage and service requirements, if any, prescribed by the plan as a condition of participation. ###

(d)####

(1)Employer contributions meet the requirements of this subsection only if such contributions— #####

(A)will total not less than $162,500,000 before the close of the four-year period beginning not later than the one hundred and eightieth day after the date of the enactment of this Act; #####

(B)are made in such amounts and at such times that no time during such four-year period will the amount of employer contributions to the trust be less than the amount such contributions would have been if made in installments of $40,625,000 made at the end of each year in such period; and #####

(C)are made in the additional qualified common stock which the Chrysler Corporation issues by reason of subsection (a)(3). ####

(2)#####

(A)In the case of a qualified loan to the trust for the purchase of qualified common stock the amount of such stock purchased with the proceeds of such loan shall be treated for purposes of paragraph

(1)as an employer contribution to the trust made on the date such stock is so purchased. #####

(B)For purposes of subparagraph (A), the term “**qualified loan**” means any loan— ######

(i)which may be repaid only in substantially equal installments; ######

(ii)which has a term of not more than ten years; and ######

(iii)the proceeds of which are used only to purchase an amount of the additional qualified common stock which the Chrysler Corporation issues by reason of subsection (a)(3). ###

(e)For purposes of this section, the term “**qualified common stock**” means stock of the class of common stock of the Chrysler Corporation which is outstanding on October 17, 1979, and which is readily tradeable on an established securities market. ###

(f)An amount equal to $162,500,000 of the additional qualified common stock issued by the Corporation by reason of subsection (a)(3) shall not be treated for purposes of this Act as assistance received by the Chrysler Corporation from other than the Federal Government pursuant to section 4(c).