S. I. Guttman Limited - June 2, 2006

IN THE MATTER of the Pension Benefits Act, R.S.O. 1990, c. P.8, as amended (the “PBA”)

AND IN THE MATTER of a Proposal of the Superintendent of Financial Services to make an Order under section 78(1) of the PBA, relating to the S. I. Guttman Limited Executive Pension Plan, Registration Number 901082

TO:

Stephen I. Guttman Holdings Limited, Receiver of 647668 Ontario Limited
c/o Basman Smith LLP
111 Richmond Street West, Suite 1400
Toronto ON M5H 2G4

Attention : Muni Basman
                  Applicant

 

NOTICE OF PROPOSAL

WHEREAS 647668 Ontario Limited (formerly S. I. Guttman Limited) sponsored, as employer, the S. I. Guttman Limited Executive Pension Plan, Registration No. 901082 (the “Plan”), which provided a non-contributory defined benefit for certain of its employees,

AND WHEREAS Stephen I. Guttman Holdings Limited was appointed Receiver and Manager of the assets, property and undertaking of 647668 Ontario Limited on October 29, 1994 pursuant to the terms of certain General Security Agreements dated April 30, 1990, September 8, 1993 and June 25, 1993,

AND WHEREAS Stephen I. Guttman Holdings Limited was a Secured Creditor of 647668 Ontario Limited under the General Security Agreement dated September 8, 1993,

AND WHEREAS Stephen I. Guttman Holdings Limited in its capacity as Receiver of 647668 Ontario Limited is entitled to receive any surplus funds payable to 647668 Ontario Limited under the Plan,

AND WHEREAS Stephen I. Guttman Holdings Limited made an application to the Superintendent of Financial Services dated January 12, 2006 for the consent of the Superintendent to the payment of money out of the Plan that is surplus in accordance with a Surplus Settlement Agreement entered into with certain of the members of the Plan,


I PROPOSE TO MAKE AN ORDER under section 78(1) of the PBA, consenting to a payment out of the Plan to Stephen I. Guttman Holdings Limited, as Receiver of 647668 Ontario Limited, in the amount of $257,135.50 (representing 50% of the surplus in the Plan of $514,271.00 determined as at August 1, 1992, the wind up date of the Plan), plus 50% of the interest, earnings and experience gains (net of all investment and experience losses thereon) on the surplus from August 1, 1992 to the date of distribution of the said payment, less 50% of all costs and expenses of the Plan inclusive of all legal fees incurred by the Receiver relating to the implementation of the Surplus Settlement Agreement and the distribution of the surplus.

I PROPOSE TO MAKE THE ORDER effective only after the Applicant satisfies me that all benefits, benefit enhancements (including benefits and benefit enhancements pursuant to the Surplus Settlement Agreement described in paragraph #6 below) and any other payments to which the members, former members, and any other persons are entitled under the Plan have been paid, purchased or otherwise provided for.

REASONS:

  1. The Plan was wound up, effective August 1, 1992.

  2. As at August 1, 1992 the surplus in the Plan was estimated to be $514,271.

  3. The Plan provides for payment of surplus to the employer on the wind up of the Plan.

  4. Stephen I. Guttman Holdings Limited was appointed Receiver and Manager of the assets, property and undertaking of 647668 Ontario Limited on October 29, 1994.

  5. Stephen I. Guttman Holdings Limited in its capacity as Receiver and Manager is entitled to receive any surplus funds payable to 647668 Ontario Limited under the Plan.

  6. The application discloses that by written agreement made by Stephen I. Guttman Holdings Limited and Joi Guttman, the wife of the sole active member of the Plan at wind up, namely Stephen I. Guttman (since deceased), the surplus in the Plan at the date of payment, after deduction of expenses related to the Plan and legal fees related to the Surplus Settlement Agreement and the distribution of surplus, is to be distributed:
    1. 50% to the Stephen I. Guttman Holdings Limited, and
    2. 50% to the Consenting Plan Member of the Plan as defined in the Surplus Settlement Agreement, which person is Joi Guttman.

  7. An addendum to the Application filed by the Applicant in the form of a Surplus Withdrawal Consent dated April 29, 2006, signed by the sole former member of the Plan at wind up, Agnes Anna Marie Guttman, she being the former wife of Stephen I. Guttman at the time of wind up, indicates that she has agreed with and has given her consent to the distribution of surplus in accordance with the terms of the Surplus Settlement Agreement, and has acknowledged she will receive no portion of the said surplus distribution.

  8. Stephen I. Guttman Holdings Limited has applied, pursuant to section 78 of the PBA, and section 8(1)(b) of Regulation 909 (the “Regulation”), for the consent of the Superintendent of Financial Services to the payment of 50% of the surplus in the Plan (after adding 50% of net investment earnings and deducting 50% of the expenses related to the wind up of the Plan inclusive of legal fees related to implementing the Surplus Settlement Agreement and the distribution of surplus).

  9. The application appears to comply with sections 78, 79(3)(a) and 79(3)(b) of the PBA and with sections 8(1)(b), 28(5), 28(5.1) and 28(6) of the Regulation.

  10. Such further and other reasons as may come to my attention.

 

YOU ARE ENTITLED TO A HEARING by the Financial Services Tribunal (the Tribunal) pursuant to section 89(6) of the PBA. To request a hearing, you must deliver to the Tribunal a written notice that you require a hearing, within thirty (30) days after this Notice of Proposal is served on you.

YOUR WRITTEN NOTICE must be delivered to:

Financial Services Tribunal
5160 Yonge Street
14th Floor
Toronto, Ontario
M2N 6L9

Attention: The Registrar

FOR FURTHER INFORMATION on a Form for the written notice, please see the Tribunal website at www.fstontario.ca or contact the Registrar of the Tribunal by phone at
416- 590-7294, toll free at 1-800-668-0128, ext. 7294, or by fax at 416-226-7750.

IF YOU FAIL TO REQUEST A HEARING WITHIN THIRTY (30) DAYS, I MAY CARRY OUT THE PROPOSAL AS DESCRIBED IN THIS NOTICE.


DATED at Toronto, Ontario, this 2nd day of June , 2006.


K. David Gordon
Deputy Superintendent, Pensions


Copy to:

PricewaterhouseCoopers Inc.
Mississauga Executive Centre
One Robert Speck Parkway, Suite 1100
Mississauga, ON L4Z 3M3

Attention:
Ms. Sharon Carew
Director, Global Human Resources
Plan Administrator

Copy to:

Blake, Cassels & Graydon LLP
Box 25, Commerce Court West
199 Bay Street
Toronto ON M5L 1A9

Attention:
Mr. Paul Dimitriadis
Counsel for the Applicant


*NOTE—PURSUANT to section 112 of the Act any notice, order or other document is sufficiently given, served, or delivered if delivered personally or sent by first class mail and any document sent by first class mail shall be deemed to be given, served, or delivered on the seventh day after mailing.

 
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