2203004 Informal Interpretation

From:
Sent:
Sheinberg, Samuel I.
From: 	HSRHelp
Sent: 	Tuesday, March 22, 2022 2:07 PM
To: 	Wa lsh, Kathryn E.; Berg, Karen E. ; Musick, Vessel ina; Sha ffer, Kristin; She inberg, Samuel I.; Six, Anne
Subject: 	FW: Question Re: Item 4(b)
From: Whi te head, Nora < nwhitehead@ftc.go v>
Sent: Tuesday, Ma rch 22, 2022 2:06:34 PM (UTC-05:00) Eastern nme ( US & Canada)
To:
Cc: 	e p < 	e p 	c.gov>
Subject: RE: Question Re: Item 4 (b)
If top- level (or ov er lap) financial statements ex ist, then they shou ld be provided.
From: HSRHelp <HSRHe lp@ftc.go v>
Sent: Tuesda y, March 22 , 2022 11 :57 AM
To: Walsh , Kathryn E. <kwalsh@ftc.gov>; Berg, Karen E.<KBERG@ftc.gov>; Musick, Ves seli na <vmu si ck@ftc.gov>;
Shaffer, Kristin <kshaffer@ftc.gov>; She inberg, Samuel I. <SSHE INBERG@ftc.gov>; Six, Anne <asix@ftc.gov>; W hitehead,
Nora <nw hitehead@ftc.go v>
Subject: FW: Quest ion Re: Item 4(b)
>
(UTC-05:00) Easte rn nme ( US & Ca nada)
To: HSRHe l 	< HSRHe l @ftc. ov >
Cc:
Su
He ll o,
I am seeking some clarification on the instructions for Item 4(b) where the ac quiring UPE Is a natural person.
For Item 4(b ), the instructions provi de that a natural person must provide the financial statements for the highest level
ent ity the natural person contro ls, but a ls o that the acquiri ng person should provide the most recent reports of the
ac quiring ent it y and an y contro ll ed ent ity contr i but ing to any ov er l ap s in Item 7.
Informal Interpretat ion Nos. 17010005 and 1709003, howev er, seem to i nd icate that where a natu ra l person is the UPE
of a new ly-formed acquiring ent ity wi tho ut finan ci al statement s, and the UPE does not contro l an y ent it i es that operate
in the target's NA ICS code s, the natu ra l person can stipulate he/ she meets the si ze of person test without providing the
financial statements for any top-level ent it ie s. Similarly, these Informal Interpretat ions seem to indicate that if the UPE
does control an ent it y that operates in the target's NA ICS code s, he/s he may produce the most recent financial
statements for su ch ent it y and sti pu late he/ she sat is fies the si ze of person test wi tho ut providi ng the financial
statements for any top-level ent it y. Is my reading of these i nterpretat ions correct?
By contrast, in a situat ion where the acquiring ent ity contro ll ed by a UPE that is a natu ra l person is not ne wly -formed
and does ha ve financial statements, is it a ls o suffi cient to provide tho se (and the financial statements of any other entit y
that c ontr ibutes to an Item 7 ov er lap) without providing any financial statements for a top-level ent ity? Or is th is a
situat ion in w hi ch financial statements for the top- level entit y are required?
Than ks v ery much,
1