Securities Exchange Act of 1934
Rule 13e-4(f)(5)
Rule 14e-1(c)

September 13, 2007

Response of the Office of Mergers and Acquisitions
Division of Corporation Finance

Craig N. Adams, Esq.
Baker Botts LLP
2001 Ross Avenue
Dallas, Texas 75201-2980

Dear Mr. Adams:

We are responding to your letter dated September 13, 2007 addressed to Daniel F. Duchovny and Michael Pressman, as supplemented by telephone conversations with the staff of the Division of Corporation Finance, with regard to your request for exemptive relief. To avoid having to recite or summarize the facts set forth in your letter, our response is attached to the enclosed copy of your letter. Unless otherwise noted, capitalized terms in this letter have the same meaning as in your letter.

On the basis of your representations and the facts presented in your letter, the U.S. Securities and Exchange Commission hereby grants an exemption from Rule 13e-4(f)(5) and Rule 14e-1(c) under the Exchange Act to permit Microtune to delay the payment of the Cash Payment until the Cash Payment Dates as described in your letter.

In granting the requested relief, we note in particular that:

• The Proposed Offer is being made for compensatory purposes in order to minimize or avoid potential materially adverse personal tax consequences to Microtune employees;
   
• The delay in the payment of the Cash Payment related to options that are vested on the date the Proposed Offer closes and/or that vest after the Proposed Offer closes and prior to January 1, 2008 is required by the provisions of IRS Rule 409A;
   
• The Cash Payments made subsequent to the January 2008 Payment Date will be made no later than the first payroll pay-date after the end of the quarter in which the Eligible Options vest;
   
• Upon vesting of Eligible Options, the right to receive the Cash Payments will become a non-forfeitable contractual right;
   
• The Proposed Offer is not being made to Microtune's officers and directors; and
   
• Aside from the prompt payment issue, Microtune has determined that it may rely on the relief granted by the staff of the Division of Corporation Finance pursuant to the Exemptive Order for Issuer Exchange Offers that are Conducted for Compensatory Purposes issued on March 21, 2001.

The foregoing exemptive relief is based solely on your representations and the facts presented in your letter dated September 13, 2007, as supplemented by telephone conversations with the Commission staff. This relief is strictly limited to the application of the rules listed above to the Proposed Offer. You should discontinue the Proposed Offer pending further consultations with the staff if any of the facts or representations set forth in your letter change.

As you note in your letter, the Commission has granted relief similar to that requested on behalf of Microtune on another occasion¹ in order to permit issuers to delay the payment of cash consideration offered in an option repricing tender offer made by issuers to their current employees (other than their current and former executive officers and directors) for compensatory reasons in order to address the potential materially adverse personal tax treatment of certain options under IRS 409A. Rule 13e-4(f)(5) of the Exchange Act and Rule 14e-1 of the Exchange Act require that consideration offered in a tender offer be paid promptly after termination of the offer. Absent the exemptive relief, issuers could not delay the payment of the cash consideration until January 2008.

We therefore find that it is appropriate in the public interest and consistent with the protection of investors to grant, and hereby grant, an exemption from Rule 13e-4(f)(5) of the Exchange Act and Rule 14e-1 of the Exchange Act to permit any issuer to delay the payment of cash consideration offered in an option repricing tender offer provided that:

• the option repricing tender offer is made to current employees of an issuer for compensatory purposes in order to address the potential materially adverse personal tax treatment of certain options under IRS Rule 409A;
   
• the delay in the payment of any cash consideration offered in the option repricing tender offer is required by the provisions of IRS Rule 409A;
   
• with respect to options vested prior to January 1, 2008, the issuer's employees are granted a contractual right to the payment of the cash consideration and the cash consideration is paid as soon as practicable, generally the first regular payroll pay-date, in January 2008;
   
• with respect to options that vest after December 31, 2007 and in order to serve the issuer's compensatory purposes, the issuer's employees will be granted a contractual right to the payment of the cash consideration on the date the options vest (which payment would be made no later than the first payroll pay-date after the end of the quarter in which the options vest), provided the employees remain in the issuer's employment at the time the options vest;
   
• the vesting and exercisability provisions of an employee's options will not be affected by the option repricing tender offer;
   
• the offer is not being made to an issuer's former or current executive officers or directors; and
   
• the issuer determines that, aside from the prompt payment issue, it may rely on the relief granted by the staff of the Division of Corporation Finance pursuant to the Exemptive Order for Issuer Exchange Offers that are Conducted for Compensatory Purposes issued on March 21, 2001.

We also direct your attention to the anti-fraud and anti-manipulation provisions of the federal securities laws, including Section 9(a), 10(b) and 14(e) of the Exchange Act and Rule 10b-5 thereunder. Responsibility for compliance with these and any other applicable provisions of the federal securities laws rest with the participants in the Proposed Offer. The Division of Corporation Finance expresses no view with respect to any other questions that the Offer may raise, including, but not limited to, Microtune's compensation policies, the use of incorrect measurement dates for the Affected Options, Microtune's reliance on the Exemptive Order for Issuer Exchange Offers that are Conducted for Compensatory Purposes issued by the staff of the Division of Corporation Finance on March 21, 2001, and the adequacy of the disclosure concerning, and the applicability of any other federal or state laws to, the Proposed Offer.

For the Commission,
by the Division of Corporation Finance
pursuant to delegated authority

Brian V. Breheny
Chief, Office of Mergers and Acquisitions
Division of Corporation Finance

Endnotes

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¹ See letter to HCC Insurance Holdings, Inc., dated June 12, 2007, located at: http://www.sec.gov/divisions/corpfin/cf-noaction.shtml#chron.

Incoming Letter:

The Incoming Letter is in Acrobat format.

http://www.sec.gov/divisions/corpfin/cf-noaction/2007/microtune091307-13e4.htm