Subsidiary as Lender to ESOP

[ERISA-Bubs]

Our ESOP is maintained by the Holding Company and the ESOP has borrowed from the subsidiary directly under the Holding Company. We are restructuring to put a new entity between the holding company and the current subsidiary that is the lender to the ESOP. Is it OK for the same entity to continue to be lender (the sub of the sub of the Holding Company that maintains the ESOP)? Or should be get the loan transferred to the new subsidiary?

[Griswold]

FWIW, I don't think it matters; I don't see any issues either way. As long as the loan is at least as favorable as the ESOP could have gotten in an arms length negotiation, anyone can lend to the ESOP. That's my 2 cents, anyway.