Hart Scott Rodino: 2011 Amendments to the Rules Forms and - PowerPoint PPT Presentation

Presenting a 90 ‐ Minute Encore Presentation of the Teleconference with Live, Interactive Q&A Hart ‐ Scott ‐ Rodino: 2011 Amendments to the Rules Forms and Instructions the Rules, Forms and Instructions Navigating Complex Regulatory Requirements For Premerger Notifications TUES DAY, S EPTEMBER 20, 2011 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific Today’s faculty features: Kathryn E. Walsh, Attorney, Federal Trade Commission , Washington, D.C. K th E W l h Att F d l T d C i i W hi t D C Karen Berg, Attorney, Federal Trade Commission , Washington, D.C. Ellen M. Jakovic, Partner, Kirkland & Ellis , Washington, D.C. Mary K Marks of Counsel Greenberg & Traurig New Y Mary K. Marks, of Counsel, Greenberg & Traurig , New Y ork ork Bruce J. Prager, Partner, Latham & Watkins , New Y ork S teven J. Cernak, General Motors Company, Detroit The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10 .

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Introduction • The changes to the HSR Rules and Form significantly h h h l d i ifi l reduce burden for most filers • New information will provide the agencies with a much more accurate understanding of the competitive impact of transactions • Application will evolve via informal interpretation 5

6 Associates

Before you identify Associates 1. Identify the Acquiring Entity 2. Identify the UPE and all controlled entities 2. Identify the UPE and all controlled entities 3. Then begin the Associate analysis

Identifying Associates • S tructure charts • for all fund groups that share an investment manager/ GP/ MM manager/ GP/ MM • Organizational documents • LLC or LP Agreements LLC or LP Agreements • Investment Management Agreement • required for individuals • Websites • Ask questions 8

Collecting Associates’ Investment Information • Quarterly financial statements that list investments (not industries) ( ) • Quarterly S EC filings • Non-publicly traded investments bl l d d • Associates with restrictions on information sharing 9

Reporting for Associates • Entities with overlaps only • Minority holdings – name and percentage held (Item 6( )(ii)) 6(c)(ii)) • NAICS or Industries • All, or j ust overlaps All j t l • $10 million threshold • C Controlled entities – geographic information (Item t ll d titi hi i f ti (It 7(d)) • NAICS Overlaps No minimum amount • NAICS , Overlaps, No minimum amount

Tracking Associate Industries or NAICS • Investment Groups • Corporate Groups • Track Industries • Identify/ assign 6 digit NAICS • Be ready to report geographic information 11

Associates – from the Company Perspective • Aimed at private equity funds and other entities that often use limited partnerships • Unlikely to effect most industrial companies, given definitions of “ control” and “ management” • S till, good to check your client’s ownership structure – and might need to do so for Russian or other filings anyway anyway 12

13 Item 4

The New Item 4(d) – Transaction Analyses • Item 4(c) already requires the parties to search directors’ and officers’ files for analyses of the transaction with respect to competition. • Item 4(d) requires three additional types of transaction analyses – but does not require the parties to search files beyond those of the 4(c) does not require the parties to search files beyond those of the 4(c) directors and officers. • Most informal interpretations for Item 4(c) also apply to Item 4(d). For p ( ) pp y ( ) example: • Parties must submit only the final version of a document presented to the Board or officers; and to the Board or officers; and • Parties need not submit documents relating to exempt portions of the transaction. 14

Item 4(d)(i) – the CIM 4(d)(i) requests the Confidential Information Memorandum (CIM) or 4(d)(i) requests the Confidential Information Memorandum (CIM) or the document(s) serving the purpose of a CIM • Note that in many cases, CIMs that mention, e.g., competition, competitors, markets and market shares have already been submitted as Item 4(c) documents markets, and market shares have already been submitted as Item 4(c) documents. Now the CIM must be submitted regardless of whether it has 4(c) content. • The seller need only submit the CIM that was given to the buyer in the transaction – not other versions that may have been given to other potential buyers not other versions that may have been given to other potential buyers. • If there is no formal CIM for the transaction, the question is whether there is a single document (or at most a couple of documents) that served the same purpose – not a broader group of documents and presentations that together serve the g p p g purpose of a CIM. • If a deal dies, is resurrected, and has a new CIM put together for the new iteration, only the second CIM should be submitted with Item 4(d). • However, the original CIM may also need to be submitted with Item 4(c). 15

Item 4(d)(ii) – Bankers’ Books • Item 4(d)(ii) requests all bankers’ books or other consultants’ 4(c)-type analyses of the transaction prepared within one year of the filing. prepared within one year of the filing. • Note that in many cases, bankers’ books that mention, e.g., competition, competitors, markets, and market g , p , p , , shares have already been submitted as Item 4(c) documents. This item is intended expressly to capture documents that staff believes always should have been documents that staff believes always should have been supplied as 4(c) but were not for some reason. • No search of lawyers’ , bankers’ , or other consultants’ files is required. 16

Item 4(d)(iii) – Synergies and Efficiencies • Item 4(d)(iii) requests all documents evaluating synergies or efficiencies. • Note that synergies and efficiencies analyses were not required even by informal interpretations of Item 4(c). • It Item 4(d)(iii) documents may include analyses of headcount 4(d)(iii) d t i l d l f h d t reductions, financial synergies, facility consolidations and other business aspects not directly related to competitive activity. i i 17

Item 4 Financial Reports • The new Item 4 will require only the name and CIK (S EC Central Index Key) number for entities within the ultimate Central Index Key) number for entities within the ultimate parent’s control that file with the S EC (rather than active links to filings). • Item 4 will also no longer require regularly prepared balance sheets for non-S sheets for non S EC-filing entities within the group. EC filing entities within the group. 18

Item 4(d) – from the Company’s Perspective • For CIM and banker pitches ((i) and (ii)), you were probably turning them in anyway under 4(c) • Or you should have been O you s ould ave bee • Remember, limited to this transaction and officers and directors, like 4(c) • S S j o j ust slightly broaden your request to the same people t li htl b d t t th l • S ynergy documents (iii) seem unnecessary in almost all filings, so why include them? • But information likely to be in CIM or 4(c) documents anyway • • Again limited to 4(c) criteria Again, limited to 4(c) criteria 19

20 Item 5