2403005 Informal Interpretation

Sheinberg, Samuel I.
From:
Sent:
To:
Subject:
HSRH elp
Tuesday, March 19, 20 24 9:0 7 AM
Walsh , Kat hry n E.; Berg, Kare n E.; M us ick, Vesselina; Shaffer, Kr ist in; Sheinberg, Samuel I. ;
Six, Anne; Fetterman, Michel le; Burton, June; Larson, Peter
FW: Quest ion re IPO
From: Wh itehead, Nora <nwhitehead@ftc.gov>
Sent: Tuesday , Marc h 19, 2024 9:06:28 AM ( UTC-05:00 ) Easte rn T im e ( US & Canada )
To:
Cc: HSRHe lp <HSRHe lp@ftc.gov>
Subject: RE: Question re IPO
We confirm both points.
From: HSRHe lp <HSRHe lp@ftc.gov>
Sent: Monda y, March 18, 2024 11:09 AM
To: Walsh , Kathryn E. <kw alsh@ftc.gov>; Berg, Karen E. <KBERG@ftc.gov>; Mus ick, Vesselina <vmusick@ftc.gov>;
Shaffer, Kristin <kshaffer@ftc.gov>; Sheinberg, Samuel I. <SSHEINBERG@ftc.gov>; Six, Anne <as ix@ftc.gov>; Wh itehead,
Nora <nwhitehead@ftc.gov>; Fetterman, M ichelle <mfetterman@ftc.gov>; Burton , June <jburton@ftc .gov>; Larson,
Peter <plarson@ftc.gov>
Subject: FW: Question re I PO
From:
Sent: Monda y, Ma rch 18, 2024 11:08:56 AM ( UTC-05 : 00 ) Eastern Ti me ( US & Canada )
To: HSRHe lp <HSRHe lp@ftc.gov>
Subject: Question re IPO
You don 't o ft en get email from
Dear PNO:
I am w ork ing on a fi ling for a company wi th an IPO (" Company A ") . As a result of the IPO , Company A' s preferred v ot ing
securit ies will automat i ca lly convert i nto shares of Company A common stock. One of the officers of Company A
(" Officer B") ho lds shares of Company A common stock but does not ho ld preferred shares, meaning that Officer B does
not ho ld vot ing securit ies that convert upon the I PO. How ev er, as a result of the conversion of preferre d shares held by
other shareholders and corresponding changes to Company A's charter, Officer B' s v ot ing percentage wi ll increase wi th
the IPO. For th is email, w e can assume that Officer B is i nstrumenta l in causing the IPO and that the relev ant HSR
thresho ld s are satisfi ed.
1. 	Can you please confirm it remains PNO ' s posit ion that a shareholder w ho is i nstrumenta l in causing an IPO and
whose vot ing percentage increases as a result of the IPO must fi le HSR , even if the sharehold er (i) does not ho ld
v ot ing securit i es that are subj ect to automatic conversation at the t i me of the I PO and (ii) wi ll not otherw i se
acquire addit ional vot ing securit ies as a result of the IPO?
2. 	Assuming th is remains the pol icy of PNO , w e w ou ld fi le the HSR not ification as an 801.30 transaction but none of
the types of transactions listed in 801.30(a) are a perfect fit because Officer B w ill not acquire or conv ert v ot ing
securit i es. 801.30(a )( 6) appears to be the best fit even though Off icer B' s v ot ing securit i es will not actually be
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converted because the conversion of other voting securities at the time of the IPO is what leads to the increase
in voting percentage. Can you please confirm a filing in this scenario should be filed as an 801.30(a)(6)
transaction?
Thanks,
.
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