0903006 Informal Interpretation

From:

(Redacted)

Sent:

Monday, March 09, 20094:08 PM

To:

Verne, B. Michael

Cc:

(Redacted)

Subject:Acquisition subject to Section 7A(c)(1)

Michael:

Thankyou for speaking with us earlier today. This is to confirm the substance of ourtelephone conversation, at the end of which you indicated that it would not benecessary for the parties to make an HSR filing in connection with thetransaction described below:

CompanyA is a financial services company. Among its many lines of business, itoriginates and services equipment leases, but does not hold title to tileequipment. (In our call, I believe I may have referred to these as"accounts receivable." I do not believe that my in artful descriptionwill cause the analysis to differ, but did want to call your attention to thefact that the receivables in question are equipment leases). Company A hasagreed to the material terms of an agreement in which it will sell to Company Bits equipment lease origination business along with some of the leases which itcurrently services. Company A will, however, continue to service a portion ofthe equipment leases which it currently holds.

Equipmentleases are similar to accounts receivable. Pursuant to Formal InterpretationNo.9, the PNO no longer considers accounts receivables to be cash equivalentsunder Section 801.21 (a) of the premerger notification rules, and therefore theacquisition of accounts receivable are no longer treated as exempt assets. ThePNO does, however, recognize that in certain situations the acquisition ofaccounts receivable constitutes an acquisition "in the ordinary course ofbusiness" and therefore such acquisitions are exempt from the HSR Act'snotification and reporting requirements pursuant to Section 7A( c)(I). It isour view that the transaction that is described here is the type of transactionsubject to the exemption provided by Section 7A(c )(I). And based on our callearlier today, it is our understanding that you concur with our conclusion.