New DOL Regulation/Tribune ESOP Update
March 12, 2007

The DOL published a new regulation last week: DOL Regulation - Time and Order of Issuance of Domestic Relations Orders (DROs) (Mar 7, 2007). It is an interim final rule that provides guidance to plan administrators, service providers, participants, and alternate payees on the qualified domestic relations order (QDRO) requirements under ERISA, and it is effective April 6, 2007. The regulation provides for the following:

1. Subsequent Domestic Relations Orders – A DRO that would otherwise be considered a QDRO will not fail to be considered a QDRO solely because the DRO is issued after, or revises, another DRO or QDRO.
2. Timing of Domestic Relations Order - A DRO that would otherwise be considered a QDRO will not fail to be considered a QDRO solely because of the time at which it is issued (after the death of the participant, after the parties divorce, after the participant’s annuity starting date).
3. Requirements and Protections - A DRO described in the DOL regulation is subject to the same requirements and protections that apply to all QDROs.

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We previously discussed the proposed Tribune transaction in the following posts:

Proposed Transaction to Structure a Buyout Around an ESOP

Tribune Company/ESOP Update

This post recapped what we have already discussed along with discussing some of the history behind ESOPs being used for leveraged buyouts. In addition, another blog says that, "Zell wants to take the company private for about $13 billion, and act as its chairman."