0907003 Informal Interpretation

07/08/2009 That particular letter was fact specific to a particular transaction and is not meant to imply that we endorse the use of escrow accounts for any purpose. This transaction involved a French tender offer, which under French law required shares to be tendered in a time frame that was in conflict with the HSR waiting period. As a matter of comity, we allowed the escrow. Otherwise, the acquiring person would have either had to violate French law or US law. As a general rule, we don't allow escrow arrangements except in very unusual circumstances. The only other occasion I remember since 2006 involved a merger which was not problematic, but resulted in a secondary acquisition that raised antitrust concerns. In order not to hold up the merger, we allowed the secondary acquisition to be closed into escrow until the antitrust review was completed. I know that years ago, the PNO was more liberal in allowing these arrangements. However, we later found that they were being abused by some investment funds and being used to establish a market position prior to the expiration of the HSR waiting period. That is not an allowable reason to establish an escrow account.