Gresham Capital CLO IV B.V. - Irish Stock Exchange

ERISA CONSIDERATIONS
The U.S. Employee Retirement Income Security Act of 1974, as amended (“ERISA”), imposes certain
requirements on employee benefit plans subject to ERISA, including entities (such as collective investment
funds and some insurance company separate accounts) whose underlying assets are treated as being subject to
ERISA (collectively, “ERISA Plans”) and on those persons who are fiduciaries with respect to ERISA Plans.
Investments by ERISA Plans are subject to ERISA’s general fiduciary requirements, including the requirement
of investment prudence and diversification and the requirement that an ERISA Plan’s investments be made in
accordance with the documents governing the ERISA Plan. The prudence of a particular investment should be
determined by the responsible fiduciary of an ERISA Plan by taking into account the ERISA Plan’s particular
circumstances and all of the facts and circumstances of the investment including, but not limited to, the matters
discussed above under “Risk Factors” and the fact that in the future there may be no market in which such
fiduciary will be able to sell or otherwise dispose of the Notes.
Section 406 of ERISA and Section 4975 of the Code prohibit certain transactions involving the assets of an
ERISA Plan, as well as those plans that are not subject to ERISA but which are subject to Section 4975 of the
Code, such as individual retirement accounts and Keogh plans, and including entities whose underlying assets
are deemed to include assets of any such plan (together with ERISA Plans, “Plans”), and certain persons
(referred to as “parties in interest” under ERISA or “disqualified persons” under Section 4975 of the Code)
having certain relationships to such Plans, unless a statutory or administrative exemption is applicable to the
transaction. A party in interest or disqualified person who engages in a prohibited transaction may be subject to
excise taxes or other liabilities under ERISA and the Code.
Each of the Issuer, the Initial Purchaser and the Collateral Manager as a result of their own activities or
because of the activities of an affiliate, may be considered a party in interest or a disqualified person with
respect to Plans. Accordingly, prohibited transactions within the meaning of Section 406 of ERISA and Section
4975 of the Code may arise if Notes are acquired or held by a Plan with respect to which any of the Issuer, the
Initial Purchaser, the Collateral Manager, the obligors on or issuers of the Notes or any of their respective
affiliates is or becomes a party in interest or disqualified person. In addition, if a party in interest or disqualified
person with respect to a Plan owns or acquires a 50 per cent. or more beneficial interest in the Issuer, the
acquisition or holding of Notes by or on behalf of the Plan could be considered to constitute an indirect
prohibited transaction under ERISA or Section 4975 of the Code. Moreover, the acquisition or holding of Notes
or other indebtedness issued by the Issuer by or on behalf of a party in interest or disqualified person with
respect to a Plan that owns or acquires an equity interest in the Issuer also could give rise to an indirect
prohibited transaction under ERISA or Section 4975 of the Code.
Certain exemptions from such prohibited transaction rules could be applicable. Included among these
exemptions are Prohibited Transaction Class Exemption (“PTE”) 90-1, regarding investments by insurance
company pooled separate accounts; PTE 91-38, regarding investments by bank collective investment funds;
PTE 84-14, regarding transactions effected by a “qualified professional asset manager”; PTE 96-23, regarding
investments by certain in house asset managers; PTE 95-60, regarding investments by insurance company
general accounts; and Section 408(b)(17) of ERISA and Section 4975(d)(20) of the Code regarding transactions
with certain service providers. Even if the conditions specified in one or more of these exemptions are met, the
scope of the relief provided by these exemptions might not cover all acts which might be construed as prohibited
transactions under ERISA or Section 4975 of the Code. If a purchase of Notes were to be a non-exempt
prohibited transaction, the purchase would have to be rescinded.
Governmental plans, certain church plans and certain non-U.S. plans, while not subject to the fiduciary
responsibility or prohibited transaction provisions of ERISA or the provisions of Section 4975 of the Code, may
nevertheless be subject to local, state, other federal laws or non-U.S. laws that are similar to the foregoing
provisions of ERISA and the Code and may be subject to the prohibited transaction rules of Section 503 of the
Code.
Section 3(42) of ERISA and a regulation promulgated by the U.S. Department of Labor, 29 C.F.R. Section
2510.3-101 (collectively, the “Plan Asset Regulation”), describe what constitutes the assets of a Plan with
respect to the Plan’s investment in an entity for purposes of certain provisions of ERISA, including the fiduciary
responsibility provisions of Title I of ERISA, and Section 4975 of the Code. Under a “look through rule” set
forth in the Plan Asset Regulation, if a Plan invests in an “equity interest” of an entity and no exception applies,
the Plan’s assets are deemed to include both the equity interest and an undivided interest in each of the entity’s
underlying assets. An equity interest does not include debt (as determined by applicable local law) which does
not have substantial equity features. The Plan Asset Regulation provides, however, that if equity participation in
214