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Date
Rule
801.2(d)
Staff
Michael Verne
Response/Comments
I agree that this should be reported as a consolidation. A, B and C will each file as both acquiring and acquired persons. Pursuant to 803.9(b) there will be only one filing fee for those three filings. Yes, any current member who takes back voting securities of Newco and satisfies the size-of-person and size-of-transaction tests will have a potentially reportable filing. Each of these backside filings would require an additional filing fee. Note that they could be exempt under 802.9.

Question

From:(redacted)

Sent:Wednesday, December 13, 2006 1:21 PM

To:Verne, S. Michael

Cc:(redacted)

Subject:801.2(d) Question

Mike,we have a question concerning a large reorganization among several relatednon-stock membership corporations that we are analyzing as a as a 801.2(d)consolidation:

A,B and C are restructuring under an upstream Newco (a newly-formed corporation).A, B C are their own UPEs and are all non-stock membership corporations. A andB are members of C. The structure of the transaction has not yet beendetermined, but A, B and C will become subsidiaries of Newco. A will likelyremain a non-stock membership corporation and Newco will hold all governanceand economic rights of A. B and C will likely convert to corporations so thatboth entities will be wholly-owned subsidiaries of Newco.

A,B and C have a significant number of members, none of whom control A, B, or C.All members of A, B, and C will receive shares of Newco as part of theconsolidation. We expect that A, B and C will file as both acquired andacquiring persons under 801.2(d).

1. Can you confirm that this transaction should bereported as a 801.2 (d) consolidation?

2. As part of the consolidation, the members of A, B andC will receive voting securities of Newco. Will the members of A, B and C alsohave to file if all thresholds are met? Since A, B and C have many overlapping members,this could mean numerous extra filings.

Feel free to call ifyou have any questions.

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