Question
From: (redacted)
Sent: Wednesday, July 12, 2006 12:50 PM
To: Verne,B. Michael
Subject: Question
Mike I have a question for you.
CompaniesA, B and C will contribute cash exceeding $226.8 million to a newco("Newco") for purposes of an acquisition. Newco will be its own UPEand has no assets other than the cash contributed upon formation. Newco willmerge with and into Company D with Company D surviving ("Transaction1"). In connection with the transaction, existing shareholders of CompanyD (which is public pre-merger, private post-merger) will be cashed out with theexception of a few rollover shareholders. Former shareholders of Newco and therollover shareholders will receive shares of Company D ("Transaction2") in exchange for their shares of Newco or Company D, as the case maybe. Certain of the rollover shareholders will decrease their percentageownership of the surviving Company D and their acquisitions should be exemptunder 7A(c)(10). Other former shareholders of Newco (who were not alsoshareholders of Company D) will receive greater than $56.7 million of votingsecurities of Company D and otherwise meet the size of parties test ifapplicable (the "Filing Shareholders") and will file for theiracquisitions of Company D securities.
Doyou agree that it is appropriate to divide this transaction into two parts? Andif so, do you agree that Transaction 1 is not reportable, only transaction 2(by the Filing Shareholders and Company D)?