2312009 Informal Interpretation

Sheinberg, Samuel I.
From: 	Sheinberg, Samuel I.
Sent: 	Wednesday, December 6, 2023 11:28 AM
To:
Cc: 	HSRHelp
Subject: 	RE: 801.2 Acquiring Person and Acquired Person Question
We agree with your analysis.
From: HSRHelp <HSRHelp@ftc.gov>
Sent: Tuesday, December 5, 2023 4:11 PM
To: Walsh, Kathryn E. <kwalsh@ftc.gov>; Berg, Karen E. <KBERG@ftc.gov>; Musick, Vesselina <vmusick@ftc.gov>;
Shaffer, Kristin <kshaffer@ftc.gov>; Sheinberg, Samuel I. <SSHEINBERG@ftc.gov>; Six, Anne <asix@ftc.gov>; Whitehead,
Nora <nwhitehead@ftc.gov>; Fetterman, Michelle <mfetterman@ftc.gov>; Burton, June <jburton@ftc.gov>; Larson,
Peter <plarson@ftc.gov>
Subject: FW: 801.2 Acquiring Person and Acquired Person Question
From:
Sent: Tuesday, December 5, 2023 4:10:15 PM (UTC-05:00) Eastern Time (US & Canada)
To: HSRHelp <HSRHelp@ftc.gov>
Subject: 801.2 Acquiring Person and Acquired Person Question
Hello,
We are preparing a premerger notification in connection with a merger between two federally insured, state-chartered
credit unions whereby the merging credit union (“Credit Union A”) will merge into and with the surviving credit union
(“Credit Union B”). Credit Union A has assets of $1.7M and Credit Union B has of $890K. Credit Union A will transfer all
of its assets, rights and properties to Credit Union B, under Credit Union B’s charter. Credit Union B will issue all
members of Credit Union A the same amount of Credit Union B’s membership shares as they hold in Credit Union A as of
the effective date of the merger, and each loan borrower of Credit Union A as of the effective date of the merger shall
have the same rights and privileges it did prior to the effective time of the merger. The financial ownership interests of
members in each credit union shall continue after the merger in the newly combined credit union. As of the date of the
merger the corporate existence of Credit Union A shall cease and the corporate existence of Credit Union B shall
continue. No new entity is being formed as part of the merger transaction.
Once the merger has been effectuated, the parties have agreed to the following:
 	the newly combined entity will use the name Credit Union A;
 	the headquarters of the newly combined credit union shall be at the headquarters of Credit Union A, though the
headquarters of Credit Union B will be used as an annex of the newly combined entity;
 	the articles of incorporation of Credit Union B will be the articles of incorporation of the newly combined credit
union;
 	the Board of Directors of this newly combined entity will consist of 3 Directors of Credit Union B and 8 Directors
of Credit Union A;
 	the Chairman and Vice Chairman of the Board of the newly combined credit union shall be the Chairman and
Vice Chairman of the Board of Credit Union A; the Secretary/Treasurer of the Board shall be designed by Credit
Union B;
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• 	the Supervisory Committee of the new ly combined credit union shall consist of 2 members of Credit Un ion Band
4 members of Credit Union A;
• 	the Governance Committee of the ne w ly combined credit union shall consist of 2 members of Credit Un ion B
and 3 members of Credit Union A;
• 	the officers of the new ly combined credit union sha ll be as follow s: The CEO, the CFO and the CIO w ill be
executive officers from Credit Un ion A; the Chief Experience Officer, the Ch ief Ri sk Officer, Ch ief Member
Officer, and SVP of Spec ial Projects shall be executive officers from Credit Union B.
12 CFR 801.2(d )( l )( ii) indicates that in a merger the designated surviving corporation in the plan w hi ch w as in existence
prior to the consummation of the merger, is deemed to ha ve made the acquisition. 12 CFR 801.2(d )( 2)(i) states that any
party to a merger that holds assets or vot ing securit i es which it did not ho ld prior to the transaction is an acquiri ng
person. 12 CFR 801.2(d)(2 )( ii) states that any party to a merger w hose assets or voting securiti es w ill be held by another
person following the transaction is considered an acquired person. 12 CFR 801.2(d )( iii) indicates that when all parties to
a transaction lose the ir separate pre-acquisition identities or become w holly owned subsidiaries of a new ly formed
ent ity, then all part ies of the transaction shall be both the acquiring and the acquired person . In the present scenario, no
new ent ity is being formed and Credit Union B is not losing its separate identity
In connection with our fi ling of the Notice, we believe that Credit Un ion A should be filing as the acquired entit y and that
Credit Union B should be fi ling as the acquiring entit y based on the structure of the merger. Ho wev er, given the post
cl osing governance structure of the part ies, we wanted to confirm w ith you that our understanding is correct.
Thank you in advance for y our ass istance.
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