dissenting.
In this ERISA case we are faced with the issue of whether, under the unusual circumstances presented, pension plan fiduciaries have a duty under § 404 of the Employee’s Retirement Income Security Act, 29 U.S.C.A. § 1104 (West 1985), to notify the plan participants of an impending termination of the plan prior to the ten day requirement of the Pension Benefit Guaranty Corporation regulations found at 29 C.F.R. 2616 et seq. I would hold that the fiduciary’s duty to inform the participants of an impending termination is implied in the “prudent man standard of care” of § 1104 where the termination date is reasonably definite and the fiduciary knows that the participant is taking action with respect to his interest unaware of the proposed termination or the effect it would have with respect to his interest. Accordingly, I would reverse the order of the district court granting summary judgment to the defendants and remand to the district court to enter judgment for the plain*233tiffs on their cross-motion and for a determination of damages.
I.
Payonk’s argument is that HMW breached its fiduciary duty by failing to notify the Metals and the Wallace employees of the proposed plan termination. Payonk contends that if the employees had known of the termination, they would have remained participants in the Plan and would have shared in the distribution of the surplus resulting in over $500,000 being shared by the plaintiff class.
HMW asks us to reject this argument based on a recent district court opinion in Trexel v. E.I. DuPont De Nemours & Co., No. 85-759 (D.Del. September 4, 1987), aff'd mem., 845 F.2d 1016 (3d Cir.1988), which held, inter alia, that the employer-administrator has no obligation under ERISA to provide information about a proposed change before it takes effect. In its general holding, Trexel, which involved a suit brought by an employee against his employer for breach of fiduciary duty and misrepresentation concerning the implementation of a retirement incentive program, is in accord with decisions of the Courts of Appeal for the Fourth and Eighth Circuits. For example, in Stanton v. Gulf Oil Corp., 792 F.2d 432 (4th Cir.1986), the court stated that “it is not a violation of ERISA to fail to furnish information regarding amendments before these amendments are put into effect.” 792 F.2d at 435. Similarly, in Porto v. Armco, Inc., 825 F.2d 1274 (8th Cir.1987), cert. denied, — U.S. —, 108 S.Ct. 1114, 99 L.Ed.2d 274 (1988), the Court of Appeals for the Eighth Circuit held that a plan “administrator who complies with the statutory standard for disclosure cannot be said to have breached the fiduciary duty by not providing earlier disclosure.” 825 F.2d at 1276.
I reject HMW’s reliance on Trexel because I find it factually distinguishable on several points. First, at the time Trexel was told there would be no new retirement incentive programs initiated at DuPont, none were in effect. In contrast, at the time HMW Plan participants were facing, the choice of making a withdrawal or rollover, the procedures for termination of the HMW Plan were in effect. Second, Trex-el’s retirement occurred prior to the implementation of the plan, thus, he was not an employee entitled to the benefit. Here, although not employees of HMW, the Metals and Wallace employees were plan participants and entitled to have their interests protected under ERISA fiduciary standards. Finally, an unpublished memorandum opinion is not binding on subsequent panels of our court. See IOP Chapter 8(c) (3d Cir.).
PBGC regulations published in 29 C.F.R. 2616 et seq. regarding “notice of intent to terminate non-multi-employer pension plans” provide as follows:
§ 2613.3 Requirement of Notice ...
(c) When to file. The Notice of Intent to Terminate shall be filed with the PBGC at least 10 days prior to the proposed date of termination of the plan.
* * * * * *
§ 2616.4 Notice to participants and retirees.
(a) General. The plan administrator shall, in accordance with this section, notify participants and retirees covered by the Plan of the proposed termination no later than the date the Notice of Intent to Terminate is filed pursuant to this part.
(Emphasis added). HMW notified its employees on March 12, 1984 of the intent to terminate effective March 31, which was the same time it notified the PBGC. HMW asks us to affirm the district court’s decision because HMW complied with all regulatory requirements.
Payonk counters that, since 29 U.S.C.A. § 1104 imposes a duty on fiduciaries to act for the benefit of the pension plan and its participants, HMW violated this duty by failing to notify employees of material and relevant facts concerning their interests in the Plan.1 In so arguing, Payonk relies on *234Rosen v. Hotel & Restaurant Emp. Bartenders Union, 637 F.2d 592 (3d Cir.1981), cert. denied, 454 U.S. 898, 102 S.Ct. 398, 70 L.Ed.2d 213 in which we held that an administrator had breached its duty by failing to notify a plan participant that his employer was no longer making contributions. In so holding we noted that such a duty has its roots in common law. Indeed, the Restatement (Second) Trusts § 173, Comment d (1959), provides:
[The trustee] is under a duty to communicate to the beneficiary material facts affecting the interest of the beneficiary which he knows the beneficiary does not know and which the beneficiary needs to know for his protection in dealing with a third person with respect to his interest.
Rosen, 637 F.2d at 600 n. 11, citing Restatement of Trusts (Second) § 173, Comment d.
I agree with Payonk that, under the specific circumstances presented, the duty involved is more clearly representative of a fiduciary’s duty in the administration of a trust and is distinguishable from those cases where the courts determined that the decision to terminate a plan was purely a business decision. See Chait v. Bernstein, 645 F.Supp. 1092 (D.N.J.1986), aff'd, 835 F.2d 1017 (3d Cir.1987) (an administrator’s termination decision is not governed by ERISA’s fiduciary duties).
In fact, the decision to terminate is usually the result of circumstances impacting on the plan sponsor — such as insolvency or the loss of the tax deduction when the plan is over funded. See 29 U.S.C.A. § 1342 [termination by PBGC] and 26 U.S. C.A. § 404 [deductions for contributions by employer to employee plan]. In other words, while the decision to terminate is a business decision, the treatment of the interests of the individual beneficiaries and participants falls within the fiduciary responsibilities of the plan administrator. Cf. Rosen, 637 F.2d at 599-600; and Central States Pension Fund v. Central Transport, Inc., 472 U.S. 559, 105 S.Ct. 2833, 86 L.Ed.2d 447 (1985) (trustee’s duty to provide for the benefit of all plan participants justifies trustee’s demand of an audit of employer records).
In discussing the framework of the ERISA-imposed fiduciary responsibilities, the Supreme Court stated in Central States that:
In general, trustees’ responsibilities and powers under ERISA reflect Congress’ policy of “assuring the equitable character” of the plans. Thus, rather than explicitly enumerating all of the powers and duties of trustees and other fiduciaries, Congress invoked the common law of trusts to define the general scope of their authority and responsibility. See, e.g., 29 U.S.C. § 1103(a) (“assets of an employee benefit plan shall be held in trust”); S.Rep. No. 93-127, p. 29 (1973) (“The fiduciary responsibility section, in essence, codifies and makes applicable to these fiduciaries certain principles developed in the evolution of the law of trusts”); H.R.Rep. No. 93-533, p. 11 (1973) (identical language); ... [Emphasis in original.]
Central States, 472 U.S. at 570 and n. 10, 105 S.Ct. at 2840 and n. 10.2
*235In addition to the statutory fiduciary responsibilities encompassed in ERISA, HMW, being the plan’s sponsor, was bound by the terms of the HMW Pension Plan agreement. Section 14.2 of the Plan specifically provided that:
Fund for Exclusive Benefit of Participants
The Fund is for the exclusive benefit of Participants and other persons who may become entitled to benefits hereunder and may also be used to pay any reasonable expenses arising from the operation of the Plan. Prior to the satisfaction of all liabilities for benefits provided hereunder, no contribution made to the Fund will be refunded to the Employer unless a contribution was made:
(A) by reason of mistake of fact,
(B) conditionally upon an initial favorable Internal Revenue Service ruling and such a ruling is not received, or
(C) conditionally upon being allowed as a tax deduction and such deduction is disallowed.
Such a refund must be made within one year, under (A), from the date the contribution was made and under (B) and (C), from the date of disallowance of tax qualification or tax deduction.
Furthermore, § 16.2 described the plan administrator’s duties and responsibilities as follows:
Duties and Authority
The Plan Administrator shall administer the Plan on behalf of the Principal Employer in a nondiscriminatory manner for the exclusive benefit of Participants and their Beneficiaries.
The Plan Administrator shall perform all such duties as are necessary to operate, administer, and manage the Plan in accordance with the terms thereof, including but not limited to the following:
(A) To determine all questions relating to a Participant’s coverage under the Plan,
(E) To advise or assist Participants regarding any rights, benefits, or elections available under the Plan.
One of the elections available to participants of the Plan was the choice of whether to remain in the Plan after the subsidiaries were divested or to withdraw from the Plan. In order to make a reasoned and informed choice, the participants must be aware of all material facts which would tend to influence that choice. See Restatement (Second) Trusts § 173, comment d (trustee is under a duty to communicate to beneficiary material facts affecting the interests of the beneficiary.)
As to what is a “material fact” necessary for the participants to make an informed choice, I find an analogy to the definition of materiality in securities cases to be helpful. Rule 14a-9, promulgated under § 14(a) of the Security Exchange Act of 1934, provides that no proxy solicitation will be made which “is false or misleading with respect to any material fact necessary in order to make the statements therein not false or misleading.” In TSC Industries, *236Inc. v. Northway, Inc., 426 U.S. 438, 96 S.Ct. 2126, 48 L.Ed.2d 757 (1976) the Supreme Court recognized that the question of materiality is an objective one since such a standard is necessary “to ensure disclosures by corporate management in order to enable the shareholders to make an informed choice.” 426 U.S. at 448, 96 S.Ct. at 2132 (Emphasis added). The Court held: “An omitted fact is material if there is a substantial likelihood that a reasonable shareholder would consider it important in deciding how to vote.” 426 U.S. at 449, 96 S.Ct. at 2132.
Generally, the question of materiality is a mixed question of law and fact involving the application of a legal standard to a particular set of facts. “Only if the established omissions are ‘so obviously important to an investor, that reasonable minds cannot differ on the question of materiality’ is the ultimate issue of materiality appropriately resolved ‘as a matter of law’ by summary judgment.” TSC Industries, 426 U.S. at 450, 96 S.Ct. at 2133 (quoting Johns Hopkins University v. Hutton, 422 F.2d 1124, 1129 (4th Cir.1970)). It seems apparent that one material fact of which participants contemplating withdrawal from a pension plan should be aware is that termination of the plan is imminent and that they could participate in the distribution of its surplus upon termination. Indeed, in their complaint, the plaintiffs alleged that over $500,000 would have been distributed to the plaintiff class had they remained in the plan. I therefore conclude that HMW had a duty under both § 404 of ERISA (29 U.S.C.A. § 1104) and § 16.2 of the HMW Plan to inform the participants, facing a decision of whether to withdraw from the Plan, of the impending termination.
II.
A legal duty is an obligation which arises from the contract of the parties or by operation of law. As such, it is a legal issue to be determined by the court. Having concluded that there was a duty on the part of HMW to inform the participants of the impending termination, I must address the issue of when the duty arose. To do so, it is necessary to scrutinize the purpose behind the obligations which ERISA imposes on the plan administrator.
The statutory fiduciary obligations imposed by ERISA have three basic components. Berlin v. Michigan Bell Telephone Co., 858 F.2d 1154, 1162 (6th Cir.1988) (citing Donovan v. Bierwirth, 680 F.2d 263, 271 (2d Cir.), cert. denied, 459 U.S. 1069, 103 S.Ct. 488, 74 L.Ed.2d 631 (1982)). The first is a duty of loyalty requiring each fiduciary to “act solely in the interests of the plan’s participants and beneficiaries.” Berlin, 858 F.2d at 1162, citing H.R. Conf. Rep. No. 1280, 93d Cong., 2d Sess., reprinted in 1974 U.S.Code Cong. & Admin. News 4639, 5083.
The second component is known as the prudent man standard of care which requires the fiduciary to act “with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims.” 29 U.S.C.A. § 1104(a)(1)(B). Thus, the prudent man standard, “combined with the duty of loyalty”
‘imposes an unwavering duty on an ERISA trustee to make decisions with single-minded devotion to a plan’s participants and beneficiaries and, in so doing, to act as a prudent person would act in a similar situation. These familiar principles evolved from the common law of trusts that Congress codified and made applicable to ERISA trustees.’ Morse v. Stanley, 732 F.2d 1139, 1145 (2d Cir. 1984).
Berlin, 858 F.2d at 1162. The final component is the requirement that the fiduciary act “for the exclusive purpose” of providing benefits to plan beneficiaries. Id.
Applying these components of the fiduciary’s obligations to the case before us, I conclude that the duty to act for the exclusive benefit of the beneficiaries required HMW to inform plan participants of the impending termination after the January 5, 1984 meeting. I base this determination on several reasons. First, a reading of the *237depositions of Richard Van Hoesen (Cla-bir’s Director of Administration) and Gloria Strantz (then Manager of Benefits for HMW Industries) indicates that this was the first meeting involving representatives of Clabir, HMW Industries, Inc., HamTech and Connecticut General Life (the plan investor) which fully discussed the major ramifications of the proposed termination among all those who had responsibility for effectuating the termination. Prior to this date, much of the correspondence involving the termination occurred between Clabir’s Van Hoesen, his superiors, and HamTech’s Owen and Strantz.3 The January 5 meeting was the culmination of correspondence and communication between Clabir, the actuaries, and the investors of the fund.
Second, I note that the tone of the meeting was not one evoking a tentative proposal to terminate, but a tone suggesting for all intents and purposes, termination was not only seriously considered, it was, in fact, imminent. More than the initial steps had been taken to terminate the HMW Plan; all that remained for the Human Resources group to do was the drafting of the new pension plan and new plan booklets. The target date for termination had been February 1, 1984 but the volumes of paperwork necessary to complete the process was taking longer than expected, and the date was pushed back.
HMW was concerned about PBGC and IRS approval of the plan termination, however, for an overfunded plan, getting approval is not an onerous task.4 Under 29 U.S.C.A. § 1341(b) the PBGC is statutorily directed to notify the plan administrator of the plan’s sufficiency as soon as practicable.5 Sufficiency of the plan is determined by whether the assets of the plan adequately “discharge when due all obligations of the plan with respect to benefits in priority categories 1 through 4” of Section 4044(a), 29 U.S.C.A. § 1344(a). 29 CFR § 2617.2 (1987). In an overfunded plan, assets are more than adequate to meet the plan’s obligations. Similarly, the IRS’ main concern is whether the plan provides that “the rights of each employee to benefits accrued to the date of such termination or discon*238tinuance, to the extent then funded, or the rights of each employee to the amounts credited to his account at such time, are nonforfeitable.” 26 CFR § 1.401-6 (1988).
The January 5 meeting was held to consider seriously the timetables involved and to decide on termination of the Plan. I have used the phrase “to consider seriously” to mirror the language of a recent decision of the Court of Appeals for the Sixth Circuit. In Berlin v. Michigan Bell Telephone Co., 858 F.2d 1154 (6th Cir.1988), the plaintiffs were employees who had retired before a second offering of retirement benefits after communications with management informed them there would not be a second retirement benefit offering. The plaintiffs claimed they were wrongfully denied benefits in violation of ERISA. 858 F.2d at 1157-60. The district court held that the defendants had no duty to disclose under ERISA because making the second offering was a business decision. Ogden v. Michigan Bell Telephone Co., 657 F.Supp. 328 (E.D.Mich.1987). Reversing the district court, the Court of Appeals for the Sixth Circuit stated that “if the plan administrator and/or plan fiduciary does communicate with potential plan participants after serious consideration has been given concerning a future implementation or offering under the plan, then any material misrepresentations may constitute a breach of their fiduciary duties.” 858 F.2d at 1164 (emphasis in original). Although factually distinguishable from the instant case since Payonk essentially raises a claim of omission rather than a claim of misrepresentation, I feel the underlying rationale imposing a duty to communicate to be in keeping with the prudent man standard encompassed in 29 U.S.C.A. § 1104.
Finally, the presence at the meeting of Gloria Strantz, the Benefits Manager at HMW Industries and the plan administrator of the HMW Plan, assured that the person who had the most direct line of communication with participants of the HMW Plan was fully aware of the status of the termination. On October 25, 1983, Ms. Strantz had sent notice to the employees of the divested subsidiaries that they would no longer accrue benefits under the HMW Plan. The notice informed each individual of the amount of his or her benefit and informed the employee of the right to withdraw from the plan, but did not inform the employees that they could share in any surplus should they remain participants of the plan at the time of termination. Although Ms. Strantz did not communicate again with the divested employees as a group until the March 12, 1984 notice of termination, she did communicate with individuals concerning the pension plan. (App. at 301). In addition, Ms. Strantz was certain of the impending termination during any communication made after January 5, 1984, and she had been informed by the Vice-President of Finance at Katy Industries, Inc., Arthur Bowker, that a 401(k) plan was being prepared for Metals and Wallace employees.
Knowledge of the impending termination is a material fact of which a reasonable plan participant would need to be aware in order to make an “informed choice.” Cf. TSC Industries, 426 U.S. at 449, 96 S.Ct. at 2132. Consequently, Ms. Strantz’ failure to notify of the impending termination those individuals requesting information would constitute a breach of fiduciary duty, and a violation of § 16.2 of the HMW Plan requiring the fiduciary “to advise or assist Participants regarding any rights, benefits or elections available under the Plan.”
I want to make certain that it is understood exactly what I would hold here. I would not hold that there is a general duty automatically to inform participants of a plan termination before the 10 day PBGC requirement. I would hold that where, as here, the decision to terminate was definite and the fiduciaries knew that the participants were withdrawing their contributions on a belief that the Plan would continue and without knowledge that they could share in the distribution of surplus assets, the fiduciaries breached their duty by remaining silent and failing to inform the Plan participants of a material fact, i.e., termination, which would permit the partic*239ipants to make an informed choice with respect to their interest in the plan.
For these reasons, I respectfully dissent.
. 29 U.S.C.A. § 1104 provides in pertinent part:
(a) Prudent man standard of care
(1) Subject to sections 1103(c) and (d), 1342, and 1344 of this title, a fiduciary shall *234discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries and—
(A) for the exclusive purpose of:
(i) providing benefits for participants and their beneficiaries; and
(ii) defraying reasonable expenses of administering the plan;
(B) with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims; ....
. The majority opinion refers to the 1986 and 1987 amendments to ERISA and notes that if the law had been in effect at the time HMW planned the termination, Payonk and his class would have participated in the distribution of the surplus. I see the change in the law as a recognition of the duty the plan has to the beneficiaries and an attempt to plug the loopholes discovered by employers as a means of avoiding that duty.
The purpose of Subtitle A of Title III, the Pension Assets Protection Act of 1987, as favorably reported by the Committee on Education and Labor are as follows:
1. to foster and facilitate interstate commerce;
*2352. to encourage the maintenance and growth of single-employer defined benefit plans;
3. to improve benefit security by increasing the likelihood that participants and beneficiaries in single-employer defined benefit plans will receive their full promised benefits by revising the current plan termination rules;
4. to improve the likelihood that single-employer defined benefit plans will not be prematurely terminated by employers who desire access to plan assets, thus resulting, in many cases, in:
a. the reduction of participants ’ benefit security with respect to future benefit accruals, and
b. the reduction or loss of the real value of benefits in retirement for participants and beneficiaries, by permitting access by employers to plan assets (above a specified cushion amount) of an ongoing plan, in limited circumstances;
5.to minimize both the number of underfunded single-employer defined benefit plans and the extent of underfunding by tightening and better targeting the minimum funding standards for single-employer defined benefit plans that are not fully funded and by making certain other changes relating to funding waivers, and timing of, and liability for pension plan contributions; ....
H.Rep. No. 100-391(1) (emphasis added), Report on Title III — Amendments to the Employee Retirement Income Security Act Relating to Plan Termination, Funding, And Other Issues, reprinted at 1987 U.S.Code Cong. & Admin.News 2313-1, 2313-77 & 78 (1988).
. The appendix to Appellants’ Brief contains a letter on Clabir stationary dated December 19, 1983 from James M. Schell, Vice President and Chief Financial Officer, to John Owen, Vice-President of Human Resources at HamTech, which stated in pertinent part: "(1) This will serve as your authorization to begin termination of the GR-81 [HMW] pension plan.” App. at 743-44. This letter was in response to Owen’s December 7, 1983 letter requesting that Schell send him a memorandum or letter "directing Gloria and me to begin the relatively long process of terminating GR-81.” GR-81 was the HMW Plan.
. Under 29 U.S.C.A. § 1204 ERISA provides for coordination between the Department of Labor and the Department of Treasury as follows:
Coordination between Department of Treasury and Department of Labor
(a) Whenever in this chapter or in any provision of law amended by this chapter the Secretary of the Treasury and the Secretary of Labor are required to carry out provisions relating to the same subject matter (as determined by them) they shall consult with each other and shall develop rules, regulations, practices, and forms which, to the extent appropriate for the efficient administration of such provisions, are designed to reduce duplication of effort, duplication of reporting, conflicting or overlapping requirements, and the burden of compliance with such provisions by plan administrators, employers, and participants and beneficiaries.
29 U.S.C.A. § 1204.
In addition the PBGC provides a one-stop procedure which allows the plan administrator to fulfill his duty of filing a notice of intent to terminate (NOIT) the plan with one form satisfying both the PBGC and the IRS. The PBGC Operations Manual, Case Processing Division, Insurance Operations Department (iOD) provides in pertinent part:
§ 2371
Methods of Filing a NOIT
The IRS/PBGC Form 5310 enables a terminating non-multiemployer defined benefit pension plan covered by Title IV of ERISA to satisfy the filing requirements of both IRS and PBGC in one filing. The filing requirements of both agencies can be satisfied with one filing to PBGC (One-Stop) or by filing separately with each agency (IRS only or PBGC only).
.29 U.S.C.A. § 1341(b) (West 1985) provides:
(b) Notice of sufficiency
If the corporation determines that, after application of section 1344 of this title, the assets held under the plan are sufficient to discharge when due all obligations of the plan with respect to basic benefits, it shall notify the plan administrator of such determination as soon as practicable.