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On December 1, 2016, Parker Hannifin Corporation and CLARCOR Inc. announced that the companies have entered into a definitive agreement under which Parker will acquire CLARCOR for approximately $4.3 billion in cash, including the assumption of net debt. The transaction has been unanimously approved by the board of directors of each company. Upon closing of the transaction, expected to be completed by or during the first quarter of Parker’s fiscal year 2018, CLARCOR will be combined with Parker’s Filtration Group to form a leading and diverse global filtration business. Bass, Berry & Sims has served CLARCOR as primary corporate and securities counsel for 10 years and served as lead counsel on this transaction. Read more here.

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Securities Law Exchange BlogSecurities Law Exchange blog offers insight on the latest legal and regulatory developments affecting publicly traded companies. It focuses on a wide variety of topics including regulation and reporting updates, public company advisory topics, IPO readiness and exchange updates including IPO announcements, M&A trends and deal news.

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Employee Benefit Plan Amendments May Be Required by Year-End

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October 7, 2014

Cafeteria Plan Amendment Required for Health Flexible Spending Arrangement Annual Limit

The Patient Protection and Affordable Care Act amended the Internal Revenue Code to impose an annual limit of $2,500 on an employee's contributions to a cafeteria plan's health flexible spending arrangement ("health FSA") effective for plan years that begin on or after January 1, 2013. This requires an amendment to most cafeteria plans with a health FSA. Pursuant to Internal Revenue Service ("IRS") Notice 2012-40, plans may be amended retroactively to adopt the $2,500 annual limit (or a lower limit as determined within the discretion of the plan administrator) until December 31, 2014. Failure to timely adopt the $2,500 annual limit may result in adverse tax consequences for employers and employees.

Qualified Retirement Plan Amendment May Be Required for United States v. Windsor

As we have discussed in previous alerts, in United States v. Windsor, the Supreme Court of the United States struck down Section 3 of the Defense of Marriage Act ("DOMA"), which limited federal recognition of marriage to legal unions between one man and one woman. The IRS subsequently issued Revenue Ruling 2013-17 to provide that, effective September 16, 2013, for purposes of enforcing the Internal Revenue Code, the IRS will recognize a same-sex marriage that is valid in the state where it was celebrated, regardless of where either spouse is later domiciled.

Pursuant to IRS Notice 2014-19, if the terms of a qualified retirement plan define a marital relationship by reference to DOMA or are otherwise inconsistent with the outcome of Windsor or Revenue Ruling 2013-17, then the plan must be amended to reflect the outcome of Windsor, effective no later than June 26, 2013, and to reflect the guidance in Revenue Ruling 2013-17, effective no later than September 16, 2013.

The amendment must be formally adopted by the latest of: (i) the end of the plan year in which the change is effective, (ii) the due date of the employer's tax return for the tax year that includes the date the change is effective, and (iii) December 31, 2014. [1] For example, the amendment deadline will be December 31, 2014 for a qualified retirement plan that has a calendar plan year and is sponsored by an employer with a calendar tax year.

Please contact a member of our Employee Benefits Practice Group if you need assistance with amending your cafeteria plan's health FSA or qualified retirement plan for the above items.



[1] Governmental plans may have additional time to adopt the amendment.


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