SEC Company Response from TREK RESOURCES INC (CIK 0001133932) — Mar 7, 2005
TREK RESOURCES INC (CIK 0001133932)
Date: March 7, 2005 · CIK: 0001133932 · Accession: 0001077629-05-000022
AI Filing Summary & Sentiment
Referenced dates: February 17, 2005
Letter
Via EDGAR and Courier Securities and Exchange Commission Division of Corporate Finance Schedule 13E-3 filed January 13, 2005 File No. 5-78060 Form 10-KSB for the year ended September 30, 2004, filed December 29, 2004 File No. 0-32491
Dear Ms. Kramer:
Pursuant to the provisions of Regulation 14C of the General Rules and Regulations promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), please find enclosed for filing on behalf of Trek Resources, Inc. ("Trek"):
(1)
revised preliminary copies of a letter to stockholders, a notice of action taken by written consent of stockholders and an information statement (herein so called), all to be furnished to the holders of common stock of Trek; and
(2)
Amendment No. 1 to Schedule 13E-3 ("Schedule 13E-3/A").
In addition, we are providing to the staff (the "Staff") of the Securities and Exchange Commission (the "Commission"), as supplemental filing material, a draft of Amendment No. 1 to Trek's Annual Report on Form 10-KSB ("Form 10-KSB/A"). It is our intention to formally file the Form 10-KSB/A via EDGAR once we have cleared all Staff comments thereto.
The changes in the information statement reflect revisions made in response to the Staff's comments set forth in their letter dated February 17, 2005. The changes in Schedule 13E-3/A reflect (i) revisions made in response to the Staff's comments set forth in their letter dated February 17, 2005 and (ii) conforming changes from the information statement. The changes in the draft Form 10-KSB/A reflect revisions made in response to the Staff's comments thereto as noted below. For your convenience, we have restated the Staff's comments below, together with a response to each respective comment.
Ms. Melinda Kramer
March 7, 2005
Page 2
We will courier to you, by overnight delivery, four (4) clean and four (4) redlined courtesy copies of the revised information statement, Schedule 13E-3/A and the draft Form 10-KSB/A. The page number references below indicate the page numbers in such redlined courtesy copies (not the EDGAR copies) where the referenced disclosure is contained in the information statement, Schedule 13E-3/A and Form 10-KSB/A.
General
1.
In your amended Schedule 13E-3 and Schedule 14C, provide page numbers in the EDGAR version.
RESPONSE: The EDGAR versions of Schedule 13E-3/A and the information statement have been revised in accordance with the Staff's comment.
2.
Many of our comments apply to more than one document or more than one section. To prevent the issuance of similar comments, please review all areas of corresponding disclosure in the various filings and make appropriate changes to all affected sections and documents.
RESPONSE: Schedule 13E-3/A, the information statement and Form 10-KSB/A have been revised in accordance with the Staff's comment.
Schedule 13E-3/A
3.
General Instruction C to the Schedule 13E-3 requires you to provide information about control persons where named filers are corporate entities. Confirm that you have provided al of the disclosure required by Items 3, 5, 6, 10 and 11 with respect to the persons specified in General Instruction C or expand to provide any additional required disclosure.
RESPONSE: Schedule 13E-3/A and the information statement have been revised in accordance with the Staff's comment (see page 4 of Schedule 13E-3/A and page 51 of the information statement). All information required under Items 3, 5, 6, 10 and 11 of Schedule 13E-3 concerning Trek and the persons described in General Instruction C to Schedule 13E-3 (including Trek's executive officer, directors and control persons) has been described in Schedule 13E-3 or incorporated by reference therein from the information statement.
Financial Information
4.
Please revise your disclosure to provide your ratio of earnings to fixed charges as well as your book value per share. Currently, the information you provide in Appendix B of your
Ms. Melinda Kramer
March 7, 2005
Page 3
Information statement, to which you refer, does not include this information. Please refer to Items 1010(a)(3) and (a)(4) of Regulation M-A.
RESPONSE: Appendix B to the information statement has been revised in accordance with the Staff's comment (see Appendix B to the information statement).
Information Statement
Questions and Answers About the Reverse Stock Split
5.
Consider including a Q&A that addresses the tax consequences for shareholders who receive stock in the reverse split and provides a cross-reference to a more detailed discussion. Please refer to Item 1013(d) of Regulation M-A.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 11 of the information statement).
What are some of the advantages of the reverse stock split?
6.
Provide support or clarification for your statement that you are obligated to "publicly disclose sensitive, competitive business information." In that regard, we note that you have not filed any requests for confidential treatment of this type of information.
RESPONSE: The reference to Trek's obligation to "publicly disclose sensitive, competitive business information" has been deleted (see page 7 of the information statement).
7.
Provide a cross-reference to the section of your information statement that discusses the other alternatives considered by the company.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 8 of the information statement).
What are some of the disadvantages of the reverse stock split?
8.
Please revise your disclosure to explain in greater detail the difference in the amount of public information that will be available with respect to the company subsequent to this going-private transaction.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 8 and 28 of the information statement).
...What are some of the reasons for going private now?
Ms. Melinda Kramer
March 7, 2005
Page 4
9.
Explain the term "going private" for the first time you use it, so that shareholders will understand the purpose and effect of this transaction.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 7 of the information statement).
Special Factors
10.
Clarify to whom you are referring when you use the utilize "management" as compared to the board.
RESPONSE: As used in the information statement, the term "management" refers to our sole executive officer, Michael E. Montgomery, our chairman of the board, chief executive officer, president and chief financial officer. Where appropriate, the information statement has been revised to refer to Mr. Montgomery in lieu of our "management" (see "Special Factors" on pages 14 through 43 of the information statement).
Background of the Reverse Stock Split
11.
Please revise to further discuss Trek's reasons for going private at this particular time. It appears that a number of the stated reasons for taking the company private have existed for some time.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 15, 16, 20 and 21 of the information statement).
12.
Explain what you mean by the "contraction of the U.S. capital markets prior to 2004." What measure are you using as the basis for that statement?
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 14 of the information statement). Mr. Montgomery believes that the general state of the economy during late 2000 through early 2004, as evidenced by (i) his own business and personal investment experience and (ii) the general business press, resulted in a reduction in public equity investment activity during that period, which diminished the benefits received by Trek in maintaining its public company status.
13.
Expand the 3rd paragraph to provide examples of situations in which "competitors had the opportunity to use Trek's disadvantage financial and other information disclosed in by Trek in its SEC filings."
RESPONSE: The reference to Trek's competitors' opportunity to use to Trek's disadvantage financial and other information disclosed in by Trek in its SEC filings has been deleted (see page 14 of the information statement).
14.
In the fifth paragraph, quantify the extent to which Hein would have increased its fee.
Ms. Melinda Kramer
March 7, 2005
Page 5
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 15, 16 and 21 of the information statement).
15.
In that same paragraph, you reference "considerable discussion by the board members." Provide more detail as to the contents of that discussion.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 15 of the information statement).
16.
Expand your discussion of the background of the reverse stock split to describe all material negotiations, transactions, or contracts between your board members and management. Specifically, we note your reference to a number of "informal discussions" regarding this transaction. Please refer to Items 1005(b) and (c) of Regulation M-A. disclose the precise date of each substantive negotiation or contact and describe the substance of the discussions or negotiations rather than merely listing the items discussed. Identify the participants in and initiator of each meeting. Revise your discussion of those meetings to provide the reader with more of a sense of the content of those discussions. We note that your current disclosure is more summary in nature.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 15 through 22 of the information statement). We note that the exact dates of certain of the informal conversations held among Mr. Montgomery and the other board members during August and September 2004 are unknown.
17.
Please provide the staff with any non-public information or projections that were material to your determination to proceed with this transaction. Provide us also with the November 19, 2004 memorandum delivered to the board.
RESPONSE: The November 19, 2004 memorandum delivered to Trek's board of directors is enclosed with this letter. There was no additional non-public information or projection that was material to Trek's determination to proceed with the transaction.
Cash-Out Merger
18.
You state that non-participating stockholders would not have the opportunity to participate in any growth in the value of Trek following the cash-out merger. Clarify how that differs from the reverse stock split by which a number of shareholders will be cashed out and will not be able to participate in any future growth of Trek.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 17 of the information statement).
Sale of Merger of Trek
19.
Indicate the number of "other entities" with whom Trek's management engaged in "informal discussions."
Ms. Melinda Kramer
March 7, 2005
Page 6
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 17 of the information statement).
20.
With a view towards further disclosure, tell us, in reasonable detail, about the "one potential transaction that was ultimately abandoned." How did you enter into discussion with that party, were terms discussed, were any offers made and, if so, what were they and why were they rejected? When did these discussions take place?
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 17 of the information statement).
21.
Address the consideration given by the board to engaging an investment advisor for the purpose of seeking out candidates for a sale or merger transaction. If you did not engage an advisor for that purpose, explain the basis for the statement that "management believes that there is not sufficient interest by other entities at this time." Clarify whether that is the board's belief as well.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 17 and 18 of the information statement).
Substantive Factors Favoring the Reverse Stock Split
22.
We note your statement that the board did not consider the other valuation methods because "such information was not available to, or does not apply to, Trek." For each of the four points, explain why that information is not available or does not apply. See Instruction 2 to Item 1014 of Regulation M-A.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 26 of the information statement).
Procedural Factors Favoring the Reverse Stock Split
23.
Explain to which "standards" you are referring when you claim that your average trading volume was illiquid.
RESPONSE: The information statement has been revised to eliminate the reference to the average trading volume of Trek's common stock as " . . . illiquid by most standards" (see page 27 of the information statement).
24.
In the section discussing Procedural Factors Disfavoring the Reverse Stock Split, address the fact that you did not engage a financial advisor to explore alternative transactions.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 30 of the information statement).
Effects of the Reverse Stock Split on Affiliated Stockholders
Ms. Melinda Kramer
March 7, 2005
Page 7
25.
Describe the effects of the transaction on each affiliate's interest in the net book value and net earnings of the company in terms of both dollar amounts and percentages. See Instruction 3 to Item 1013 of Regulation M-A.
RESPONSE: We note that Instruction 4 of Item 1013 of Regulation M-A provides that the effect of the transaction on the affiliates' interest in the net book value and net earnings of the subject company is required to be provided only if the Schedule 13E-3 is filed by an affiliate of the subject company. The Schedule 13E-3 is filed by Trek only. Nevertheless, we have revised the information statement in accordance with the Staff's comment (see pages 33 through 35 of the information statement), but such disclosure should not be deemed a concession that the Schedule 13E-3 is being filed by any affiliate of Trek.
Effects of the Reverse Stock Split on Trek
26.
In response to Item 1013(d) of Regulation M-A, disclose in greater detail all of the benefits and detriments of the transaction for Trek, including the savings to be realized as a result of terminating registration under the Exchange Act. Quantify your response to the extent possible. See Instruction 2 to Item 1013 of Regulation M-A.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 37 and 38 of the information statement).
27.
Explain why you give an approximate number of current record holders. Provide an actual number as of you record date.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 36 of the information statement).
Certain Material Federal Income Tax Consequences
28.
Revise your opening sentence to state that you are discussing all material federal income tax consequences. In that regard, also remove your reference to the summary not discussing all aspects of federal income taxation as you have already stated that you will be discussing the material consequences.
RESPONSE: The information statement has been revised in a
Show Raw Text
CORRESP
1
filename1.htm
March 7, 2005
Direct Phone: 972-680-7553
Direct Fax: 972-692-9053
william.boeing@haynesboone.com
Via EDGAR and Courier
Ms. Melinda Kramer
Securities and Exchange Commission
Division of Corporate Finance
450 Fifth Street NW
Mail Stop 0405
Washington, D.C. 20549-1004
RE:
Trek Resources, Inc.
Preliminary Information Statement filed January 13, 2005
File No. 0-32491
Schedule 13E-3 filed January 13, 2005
File No. 5-78060
Form 10-KSB for the year ended September 30, 2004, filed December 29, 2004
File No. 0-32491
Dear Ms. Kramer:
Pursuant to the provisions of Regulation 14C of the General Rules and Regulations promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), please find enclosed for filing on behalf of Trek Resources, Inc. ("Trek"):
(1)
revised preliminary copies of a letter to stockholders, a notice of action taken by written consent of stockholders and an information statement (herein so called), all to be furnished to the holders of common stock of Trek; and
(2)
Amendment No. 1 to Schedule 13E-3 ("Schedule 13E-3/A").
In addition, we are providing to the staff (the "Staff") of the Securities and Exchange Commission (the "Commission"), as supplemental filing material, a draft of Amendment No. 1 to Trek's Annual Report on Form 10-KSB ("Form 10-KSB/A"). It is our intention to formally file the Form 10-KSB/A via EDGAR once we have cleared all Staff comments thereto.
The changes in the information statement reflect revisions made in response to the Staff's comments set forth in their letter dated February 17, 2005. The changes in Schedule 13E-3/A reflect (i) revisions made in response to the Staff's comments set forth in their letter dated February 17, 2005 and (ii) conforming changes from the information statement. The changes in the draft Form 10-KSB/A reflect revisions made in response to the Staff's comments thereto as noted below. For your convenience, we have restated the Staff's comments below, together with a response to each respective comment.
Ms. Melinda Kramer
March 7, 2005
Page 2
We will courier to you, by overnight delivery, four (4) clean and four (4) redlined courtesy copies of the revised information statement, Schedule 13E-3/A and the draft Form 10-KSB/A. The page number references below indicate the page numbers in such redlined courtesy copies (not the EDGAR copies) where the referenced disclosure is contained in the information statement, Schedule 13E-3/A and Form 10-KSB/A.
General
1.
In your amended Schedule 13E-3 and Schedule 14C, provide page numbers in the EDGAR version.
RESPONSE: The EDGAR versions of Schedule 13E-3/A and the information statement have been revised in accordance with the Staff's comment.
2.
Many of our comments apply to more than one document or more than one section. To prevent the issuance of similar comments, please review all areas of corresponding disclosure in the various filings and make appropriate changes to all affected sections and documents.
RESPONSE: Schedule 13E-3/A, the information statement and Form 10-KSB/A have been revised in accordance with the Staff's comment.
Schedule 13E-3/A
3.
General Instruction C to the Schedule 13E-3 requires you to provide information about control persons where named filers are corporate entities. Confirm that you have provided al of the disclosure required by Items 3, 5, 6, 10 and 11 with respect to the persons specified in General Instruction C or expand to provide any additional required disclosure.
RESPONSE: Schedule 13E-3/A and the information statement have been revised in accordance with the Staff's comment (see page 4 of Schedule 13E-3/A and page 51 of the information statement). All information required under Items 3, 5, 6, 10 and 11 of Schedule 13E-3 concerning Trek and the persons described in General Instruction C to Schedule 13E-3 (including Trek's executive officer, directors and control persons) has been described in Schedule 13E-3 or incorporated by reference therein from the information statement.
Financial Information
4.
Please revise your disclosure to provide your ratio of earnings to fixed charges as well as your book value per share. Currently, the information you provide in Appendix B of your
Ms. Melinda Kramer
March 7, 2005
Page 3
Information statement, to which you refer, does not include this information. Please refer to Items 1010(a)(3) and (a)(4) of Regulation M-A.
RESPONSE: Appendix B to the information statement has been revised in accordance with the Staff's comment (see Appendix B to the information statement).
Information Statement
Questions and Answers About the Reverse Stock Split
5.
Consider including a Q&A that addresses the tax consequences for shareholders who receive stock in the reverse split and provides a cross-reference to a more detailed discussion. Please refer to Item 1013(d) of Regulation M-A.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 11 of the information statement).
What are some of the advantages of the reverse stock split?
6.
Provide support or clarification for your statement that you are obligated to "publicly disclose sensitive, competitive business information." In that regard, we note that you have not filed any requests for confidential treatment of this type of information.
RESPONSE: The reference to Trek's obligation to "publicly disclose sensitive, competitive business information" has been deleted (see page 7 of the information statement).
7.
Provide a cross-reference to the section of your information statement that discusses the other alternatives considered by the company.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 8 of the information statement).
What are some of the disadvantages of the reverse stock split?
8.
Please revise your disclosure to explain in greater detail the difference in the amount of public information that will be available with respect to the company subsequent to this going-private transaction.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 8 and 28 of the information statement).
...What are some of the reasons for going private now?
Ms. Melinda Kramer
March 7, 2005
Page 4
9.
Explain the term "going private" for the first time you use it, so that shareholders will understand the purpose and effect of this transaction.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 7 of the information statement).
Special Factors
10.
Clarify to whom you are referring when you use the utilize "management" as compared to the board.
RESPONSE: As used in the information statement, the term "management" refers to our sole executive officer, Michael E. Montgomery, our chairman of the board, chief executive officer, president and chief financial officer. Where appropriate, the information statement has been revised to refer to Mr. Montgomery in lieu of our "management" (see "Special Factors" on pages 14 through 43 of the information statement).
Background of the Reverse Stock Split
11.
Please revise to further discuss Trek's reasons for going private at this particular time. It appears that a number of the stated reasons for taking the company private have existed for some time.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 15, 16, 20 and 21 of the information statement).
12.
Explain what you mean by the "contraction of the U.S. capital markets prior to 2004." What measure are you using as the basis for that statement?
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 14 of the information statement). Mr. Montgomery believes that the general state of the economy during late 2000 through early 2004, as evidenced by (i) his own business and personal investment experience and (ii) the general business press, resulted in a reduction in public equity investment activity during that period, which diminished the benefits received by Trek in maintaining its public company status.
13.
Expand the 3rd paragraph to provide examples of situations in which "competitors had the opportunity to use Trek's disadvantage financial and other information disclosed in by Trek in its SEC filings."
RESPONSE: The reference to Trek's competitors' opportunity to use to Trek's disadvantage financial and other information disclosed in by Trek in its SEC filings has been deleted (see page 14 of the information statement).
14.
In the fifth paragraph, quantify the extent to which Hein would have increased its fee.
Ms. Melinda Kramer
March 7, 2005
Page 5
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 15, 16 and 21 of the information statement).
15.
In that same paragraph, you reference "considerable discussion by the board members." Provide more detail as to the contents of that discussion.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 15 of the information statement).
16.
Expand your discussion of the background of the reverse stock split to describe all material negotiations, transactions, or contracts between your board members and management. Specifically, we note your reference to a number of "informal discussions" regarding this transaction. Please refer to Items 1005(b) and (c) of Regulation M-A. disclose the precise date of each substantive negotiation or contact and describe the substance of the discussions or negotiations rather than merely listing the items discussed. Identify the participants in and initiator of each meeting. Revise your discussion of those meetings to provide the reader with more of a sense of the content of those discussions. We note that your current disclosure is more summary in nature.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 15 through 22 of the information statement). We note that the exact dates of certain of the informal conversations held among Mr. Montgomery and the other board members during August and September 2004 are unknown.
17.
Please provide the staff with any non-public information or projections that were material to your determination to proceed with this transaction. Provide us also with the November 19, 2004 memorandum delivered to the board.
RESPONSE: The November 19, 2004 memorandum delivered to Trek's board of directors is enclosed with this letter. There was no additional non-public information or projection that was material to Trek's determination to proceed with the transaction.
Cash-Out Merger
18.
You state that non-participating stockholders would not have the opportunity to participate in any growth in the value of Trek following the cash-out merger. Clarify how that differs from the reverse stock split by which a number of shareholders will be cashed out and will not be able to participate in any future growth of Trek.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 17 of the information statement).
Sale of Merger of Trek
19.
Indicate the number of "other entities" with whom Trek's management engaged in "informal discussions."
Ms. Melinda Kramer
March 7, 2005
Page 6
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 17 of the information statement).
20.
With a view towards further disclosure, tell us, in reasonable detail, about the "one potential transaction that was ultimately abandoned." How did you enter into discussion with that party, were terms discussed, were any offers made and, if so, what were they and why were they rejected? When did these discussions take place?
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 17 of the information statement).
21.
Address the consideration given by the board to engaging an investment advisor for the purpose of seeking out candidates for a sale or merger transaction. If you did not engage an advisor for that purpose, explain the basis for the statement that "management believes that there is not sufficient interest by other entities at this time." Clarify whether that is the board's belief as well.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 17 and 18 of the information statement).
Substantive Factors Favoring the Reverse Stock Split
22.
We note your statement that the board did not consider the other valuation methods because "such information was not available to, or does not apply to, Trek." For each of the four points, explain why that information is not available or does not apply. See Instruction 2 to Item 1014 of Regulation M-A.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 26 of the information statement).
Procedural Factors Favoring the Reverse Stock Split
23.
Explain to which "standards" you are referring when you claim that your average trading volume was illiquid.
RESPONSE: The information statement has been revised to eliminate the reference to the average trading volume of Trek's common stock as " . . . illiquid by most standards" (see page 27 of the information statement).
24.
In the section discussing Procedural Factors Disfavoring the Reverse Stock Split, address the fact that you did not engage a financial advisor to explore alternative transactions.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 30 of the information statement).
Effects of the Reverse Stock Split on Affiliated Stockholders
Ms. Melinda Kramer
March 7, 2005
Page 7
25.
Describe the effects of the transaction on each affiliate's interest in the net book value and net earnings of the company in terms of both dollar amounts and percentages. See Instruction 3 to Item 1013 of Regulation M-A.
RESPONSE: We note that Instruction 4 of Item 1013 of Regulation M-A provides that the effect of the transaction on the affiliates' interest in the net book value and net earnings of the subject company is required to be provided only if the Schedule 13E-3 is filed by an affiliate of the subject company. The Schedule 13E-3 is filed by Trek only. Nevertheless, we have revised the information statement in accordance with the Staff's comment (see pages 33 through 35 of the information statement), but such disclosure should not be deemed a concession that the Schedule 13E-3 is being filed by any affiliate of Trek.
Effects of the Reverse Stock Split on Trek
26.
In response to Item 1013(d) of Regulation M-A, disclose in greater detail all of the benefits and detriments of the transaction for Trek, including the savings to be realized as a result of terminating registration under the Exchange Act. Quantify your response to the extent possible. See Instruction 2 to Item 1013 of Regulation M-A.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see pages 37 and 38 of the information statement).
27.
Explain why you give an approximate number of current record holders. Provide an actual number as of you record date.
RESPONSE: The information statement has been revised in accordance with the Staff's comment (see page 36 of the information statement).
Certain Material Federal Income Tax Consequences
28.
Revise your opening sentence to state that you are discussing all material federal income tax consequences. In that regard, also remove your reference to the summary not discussing all aspects of federal income taxation as you have already stated that you will be discussing the material consequences.
RESPONSE: The information statement has been revised in a