Question
July 28, 2006
MichaelB. Verne
PremergerNotification Office
FederalTrade Commission
6th Street and Pennsylvania Avenue, N.W.
Washington, D.C. 20580
Re:Establishment of the (REDACTED) Asbestos Personal Injury Trust (the "PITrust")
Dear Mr. Verne:
Thank youfor returning our telephone call and speaking with (REDACTED) and me. As afollow-up to our conference call, please be advised as follows.
Inconnection with the Sixth Amended Joint Plan of Reorganization for ("(REDACTED)")and its affiliated debtors (as Modified) (the "Plan") currentlypending in the (redacted) Personal Injury Trust (the "PI Trust") willbe established to assume certain liabilities of (REDACTED) and its wholly-ownedsubsidiary, (redacted) Corporation ("(REDACTED)" and together with(REDACTED) and its affiliated debtors, the "Reorganized Debtors"). Morespecifically, (REDACTED) and (redacted) have been named defendants in thousandsof actions involving personal injury or wrongful death claims caused byexposure to asbestos-containing products for which (REDACTED) and/or(redacted), their predecessors and successors have legal liability. The Plancontemplates the creation of the PT Trust whereby the PI Trust will assume allliability for all Asbestos Personal Injury Claims (as defined in the Plan) anduse its assets and income to satisfy these claims in such a manner so that allclaimants are treated fairly, equitably and reasonable in light of the limitedassets available to satisfy such claims. The class of claimants includes, butis not limited to, present and future claimants.
As part of the reorganization contemplated by thePlan, the Reorganized Debtors shall, on the effective date of the Plan,transfer to the PI Trust approximately $2.741 billion in cash and, uponsatisfaction of certain conditions transfer and assign to the PI Trust no laterthan January 8, 2007, 28.2 million shares of new (REDACTED) common stock and$1.390 billion in cash. The 28.2 million shares shall constitute approximately21.4% of the voting securities of Reorganized (REDACTED) and, as set forth inAppendix Ito the Disclosure Statement relating to the Plan, have a value ofapproximately $845.1 million.
Additional(REDACTED) shares may be issued by (REDACTED) to the PI Trust as a result ofthe resolution of disputed claims and if the Plan is confirmed and certainclasses of creditors do not vote to approve the Plan. The number of incremental(REDACTED) shares that would be issued to the PI Trust as a result of theforegoing is 300,000 shares.
It is our understanding from our prior conversationand our review of Rule 802.71 of rules to the Hart-Scott-Rodino AntitrustImprovements Act of 1976, as amended (the "Act"), that the PremergerNotification Office would not require a filing to be made in connection withthe transfer by a settlor to an irrevocable trust. The PI Trust Agreement(Exhibit D to the Plan) in Section 1.1 indicates that (REDACTED) will be the"settlor" of the PI Trust. In addition, Section 7.1 of the PI TrustAgreement states that the PI Trust will be irrevocable.
If youdisagree with our view that a filing under the Act is not necessary in thecontext of the transaction described above, please let us know. (REDACTED) orthe undersigned will contact you next week.
1(REDACTED)A copy of the Plan is enclosed herewith.