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Date
Rule
801.1(c)
Staff
Michael Verne
Response/Comments
If X is voting the shares held by the trust in his capacity as trustee, those shares would not be aggregated with his personal holding. If he is voting them outside of his capacity as trustee, pursuant to a shareholders agreement, he would aggregate the trust holding with his own & would control Corp. A.

Question

From: (reacted)
Sent: Thursday, October 02, 2003 1:57 PM
To: Verne, Michael
Cc: (redacted)
Subject: :FW: Ultimate Parent Entity

Hi Mike- A quick question

Mr. X is the Trustee of Trust Y. TrustY is an irrevocable trust in which the settlor does not retain a reversionaryinterest. Pursuant to 16 CFR Section 801.1 (c) (3), the corpus of the trustshould be held by the trust and need not aggregated with the assets of anyother person. Trust Y holds 49.5% of the voting securities of Corporation A.Mr. X also holds 10% of the voting securities of Corporation A in his ownright.

Pursuant to the terms of theTrust, Mr. X has the power to vote the 49.5% shares of Company A, plus he has theright to vote his other 10%. Consequently he has the ability to control theBoard, despite the language of 16 CFR section 801.1(c)(3).

Am I correct in assuming that Mr Xis the ultimate parent entity of Company A?

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