2410007 Informal Interpretation

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Sheinberg, Samuel I.
From: 	HSRHelp
Sent: 	Friday, October 18, 2024 12:08 PM
To: 	Walsh, Kathryn E.; Berg, Karen E.; Musick, Vesselina; Sheinberg, Samuel I.; Six, Anne;
Whitehead, Nora; Fetterman, Michelle; Burton, June; Larson, Peter
Subject: 	FW: Question Re: Valuation and Aggregation of Privately-Held Voting Securities
From: Shaffer, Kristin <kshaffer@ftc.gov>
Sent: Friday, October 18, 2024 12:07:34 PM (UTC-05:00) Eastern Time (US & Canada)
To:
Cc: HSRHelp <HSRHelp@ftc.gov>
Subject: RE: Question Re: Valuation and Aggregation of Privately-Held Voting Securities
Yes, all three categories must be included in the size of transaction. Please see Rule 801.10 to determine valuation.
Best regards,
Kristin
Kristin Shaffer
Attorney
Premerger Notification Office
Federal Trade Commission
202-326-2388 | kshaffer@ftc.gov
From:
Cc:
Subject: Question Re: Valuation and Aggregation of Privately-Held Voting Securities
Sent: Thursday, October 17, 2024 7:36:28 PM (UTC-05:00) Eastern Time (US & Canada)
To: HSRHelp <HSRHelp@ftc.gov>
Dear	PNO:
I hope	this	inquiry	finds	you	well.
We represent Issuer	A with	respect to	an	acquisition	of additional privately-held	voting securities by current
Stockholder A.
I want to	make	sure I	correctly understand	both	the	aggregation	and valuation rules	for purposes	of	the
reportability analysis, particularly	with respect to	previously-acquired “Convertible Voting	Securities” that will
convert to	“Voting Securities” (within the meaning	of the	HSR Act)	at closing.
 	Stockholder A	currently holds	a	non-controlling	share	of	Common	Stock.	The Common Stock	carries a
present right to	vote	at	one vote per share.
 	Stockholder A	will acquire additional shares	of	Preferred	Stock	as part of the	proposed transaction. The
Preferred	Stock	will	carry a present right to	vote	at	one	vote	per share.
 	Stockholder A	also	currently	holds	Convertible Notes.	The	Convertible Notes do	not carry a	present right	to
vote	so	meet	the	definition	of	“Convertible	Voting Securities”	under	the	HSR	Act.	While the	Convertible
Notes	do not	presently carry the	right to	vote, the Convertible	Notes	will convert at close.	Once	converted,
the	Convertible	Notes will carry a	right to	vote	at one vote	per share.
For purposes	of determining whether	the	“size	of transaction”	threshold is met,	can you	confirm that:
 	The previously-acquired Common	Stock	will be	valued at	FMV;
 	The to-be-acquired Preferred	Stock	will be	valued	at the	Acquisition	Price (it is	determined);	and
 	The Convertible	Notes (because	they	will	be	converted into	voting securities	at	close) must be	included in
the	“size	of	transaction” calculation and	valued at FMV.
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If the Convertible Notes are not included or valued in some other manner for purposes of determin ing re portability,
please let us know.
Thanks so much,
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