Question
(redacted)
August 5, 1996
VIA OVERNIGHT COURIER
Premerger Notification Office
Bureau of Competition
Federal Trade Commission
600 Pennsylvania Avenue, NW, Room 303
Washington, D.C. 20580
Re:
Dear Dick:
Thank you for spending time with me on August 2, 1996 to discuss the premerger reporting requirements for the formation of joint venture which are organized as Limited Liability Companies (LLCs).
The hypothetical transaction from which my request for informal advice, see 16 C.F.R. Section 803.30, arose is follows:
Company A and Company B are each for-profit U.S. corporations with over $100 million in assets and annual revenues. A and B plan on forming a joint venture, JV, which will be organized as an LLC. A and B are each contributing assets valued in excess of $100 million to JV. A and B will be the only member of JV. JV will be governed by a member committee or its equivalent which will serve a role analogous to a board of directors for a corporation. The member committee will consist of an equal number or representatives appointed by A and B (probably 2 each). The representatives appointed by A will each be current employees, officers or directors of A. Similarly, the representatives appointed by B will each be current employees, officers or directors of B. It is anticipated that JV will have over 100 operational employees shortly after its formation. The majority of such initial employees will be individuals who presently are employed by either A or B.
Based on our conversation, I have concluded that the hypothetical transaction would not be reportable because the JV is not being governed by any individuals who were not directors, officers or employees of the members prior to the transaction.
Please contact me if I am incorrect that this transaction is not reportable, or if additional information is needed before giving advice on whether this transaction would be reportable.
Thank you very much for your time and assistance.
Sincerely,
(Redacted)
cc: (redacted)