Question
From:(redacted)
Sent:Thursday, April 13, 2006 9:32 AM
To:Verne, B. Michael
Subject:Confirmation
Ihave a proposed transaction on which I would appreciate your confirmation thatI'm thinking about it correctly.
Foreigncompany controlled by (foreign person) Father holds all of the stock of USCompany X. Father wants to transfer the stock of the US Company X to his foursons (equally).
Foreigncompany creates four wholly owned foreign subs and transfers to each of the newsubs 25% of the stock of US Company X.
Eachof the sons then gets 100% of the stock of one of the holding companies (and,indirectly, 25% of the stock of US Company X).
Assumethat the sons are neither citizens nor residents of the US.
AmI right that 802.51(b) exempts all four (essentially identical) transactionsbecause, although in each case a foreign natural person is acquiring control ofa foreign issuer, that issuer holds only a minority of the stock of US CompanyX and therefore the foreign issuer does not hold any assets (of US Company X)located in the United States and did not make any sales in or into the US inthe most recent year? In other words, none of the US assets or US sales of USCompany X are attributed to any of the holding companies via the latters'respective minority holdings of US Company X.