0605017 Informal Interpretation

From:(redacted)

Sent: Tuesday, May 16, 200610:35 AM

To:Verne, B. Michael

Subject: Re: Noncompliance question

Thanks,Mike. I have another totally unrelated question about how assumed liabilitiesfactor into valuation when LLC interests are acquired. I know that assumedliabilities are added to the purchase price for assets and are not added to thepurchase price for voting securities. Can you tell me how they are to betreated in the context of LLC interest acquisitions where the acquiring personwill hold 100% of the LLC interests as a result of the transaction?

MVComment Same as voting securities of a non-publicly traded corporation.

--------------OriginalMessage-----------

From: (redacted)]

Sent: Monday, May 15, 20067:32 PM

To:Verne, B. Michael

Subject: Noncompliance question

HiMike. Would you please give me a call in the morning? A client needs to make afiling, but is having trouble getting Item 4-6 information from two recentlyacquired entities. It "controls" these entities because it owns atleast 50% of the voting securities, but these securities are subject to proxyso it can't control the entities' actions or force them to comply withrequests.

Based on myunderstanding of the business of these entities and the entity that is beingacquired in the transaction for which we will file, there is no overlap. Also,the FTC and DOJ have recent filings from the uncooperative subsidiaries thatwere made in connection with my client's recent acquisition of their votingsecurities. I'd like to know how a statement of noncompliance would be receivedgiven the circumstances.

MV Comments Statement of reasons for non-compliance OK.