Amnex Inc. Acquisition Of Capital Network System, Inc.; §5.G, 6/26/1996

Wisconsin Insurance Commissioner required Ambac to establish a Segregated Account following losses inAmbac's insurance portfolio and resulting downgrades of its financial ratings. The insurance commissioner was appointed rehabilitator of the Segregated Account. A Segregated Account is considered a separate insurer. The Segregated Account proposed to issue notes in connection with the satisfaction of claims against the Segregated Account. The identity or number of ultimate beneficial holders of the notes could not be determined. The issuance of the notes was subject to the approval of a court. The staff confirmed that the §5.F exemption was available for the issuance of the notes pursuant to a court order rehabilitation plan, even though the notes were not issued by the company itself, nor by a successor to the company, as the Segregated Account was considered a separate insurer.