Date
Rule
802.4, 801.50, 801.11(3)
Response/Comments
The formation of LLC Z is not reportable because all that is being contributed is cash. The subsequent acquisition of LLC X would be non-reportable if the value was less than $239.2 MM, but because it exceeds that amount, the size-of-person test is inapplicable and the acquisition would be reportable. There is no exemption for an acquisition of an existing wind farm.
File
Original Image File
(51.64 KB)
Question
From: (redacted)
Sent: Wednesday, April 11, 2007 4:15 PM
To: Verne, B. Michael
Subject: Advice Please
Dear Mike - I would be grateful foryour advice on whether the following transaction is reportable:
LLC X, whose only asset is a wind farmvalued in excess of $300 million is owned 52% by Party A, and 48% by Party B.(Acquired Person)
LLC Z will be formed and will be owned 24% by an affiliateof Party A, 20% by an affiliate of Party B, 28% by Party C, and 28% by Party D.
Each of the owners of LLC Z (A,B,C, and D) will make a prorata cash capital contribution to LLC Z which LLC Z will use to acquire the LLC X for approximately $300 million.
L LC Z will contain only the cash contributed by A , B , Cand D and its sole purpose will be to purchase LLC X.