8312001 Informal Interpretation

(redacted)

December 2, 1983

FEDERAL EXPRESS

Patrick Sharpe, Esq.
FEDERAL TRADE COMMISSION
Pennsylvania Avenue At
6th Street, N.W., Room 301
Washington, D.C. 20580

Dear Mr. Sharpe:

As suggested by you in our recent telephone conversations, I am outlining the proposed transaction as to which there was a question as to whether notification was required under Hart-Scott-Rodino.

A Company (A) and B Corporation (B) each hold less than 50% of the voting securities issued by X Corporation (X). X is engaged in manufacturing and has annual net sales in excess of $700 million. B has approximately 10 shareholders.

A and B have recently caused H Corporation (H) to be formed for the purpose of acquiring voting securities of X. H is intended to function solely as a holding company. At the present time, H has no assets and has issued no stock.

A, B an Bs shareholders have agreed that:

(1) A will sell certain of its operating assets valued at less than $1.5 million to X for voting securities of X;

(2) A will exchange all of its holdings of X for voting securities to be issued by H;

(3) B will sell certain of its operating assets valued at less than $5 million to X for dollars;

(4) B will sell certain of its assets valued at less than $3 million to H for dollars and voting securities to be issued by H;

(5) Bs shareholders will exchange their B stock for dollars and voting securities to be issued by H; and

(6) H will transfer the assets acquired from B to X in exchange for voting securities of X.

All of the above transactions will take place at or about the same time.

The X voting securities acquired and held by H will have a book value of approximately $13 million. As a result of these transactions and Xs redemption, at or about the time of the transactions, of some of its voting securities held by shareholders other than A, B and H, it is expected that H will hold voting securities of X in excess of 80% of the then total issued and outstanding stock of X. No shareholder of H will hold 50% or more of the voting securities of H.

It is expected that Xs annual sales in the future will approximate $1 billion and account for about 3% of the market.

In accordance with our understanding, if it is determined that notification is required, or that the proposed transaction is objectionable on substantive grounds, you will advise me within a day or two.

Very truly yours,

(Redacted)

(Redacted)