Premerger Notification; Reporting and Waiting Period Requirements, 57110-57144 [2010-23079]

Agencies

• FEDERAL TRADE COMMISSION

[Federal Register Volume 75, Number 180 (Friday, September 17, 2010)]
[Proposed Rules]
[Pages 57110-57144]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-23079]



[[Page 57109]]

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Part II





Federal Trade Commission





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16 CFR Parts 801, 802, and 803



Premerger Notification; Reporting and Waiting Period Requirements; 
Proposed Rule

Federal Register / Vol. 75, No. 180 / Friday, September 17, 2010 / 
Proposed Rules

[[Page 57110]]


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FEDERAL TRADE COMMISSION

16 CFR Parts 801, 802, and 803

RIN 3084-AA91


Premerger Notification; Reporting and Waiting Period Requirements

AGENCY: Federal Trade Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commission is proposing amendments to the Hart-Scott-
Rodino (``HSR'') Premerger Notification Rules (the ``Rules''), the 
Premerger Notification and Report Form (the ``Form'') and associated 
Instructions in order to streamline the Form and capture new 
information that will help the Federal Trade Commission (the 
``Commission'' or ``FTC'') and the Antitrust Division of the Department 
of Justice (the ``Assistant Attorney General'' or the ``Antitrust 
Division'') (together the ``Antitrust Agencies'' or ``Agencies'') 
conduct their initial review of a proposed transaction's competitive 
impact. Section 7A of the Clayton Act (the ``Act'') requires the 
parties to certain mergers or acquisitions to file with the Agencies 
and to wait a specified period of time before consummating such 
transactions. The reporting requirement and the waiting period that it 
triggers are intended to enable the Antitrust Agencies to determine 
whether a proposed merger or acquisition may violate the antitrust laws 
if consummated and, when appropriate, to seek a preliminary injunction 
in federal court to prevent consummation, pursuant to section 7 of the 
Act.

DATES: Comments must be received on or before October 18, 2010.

ADDRESSES: Interested parties are invited to submit written comments 
electronically or in paper form, byfollowing the instructions in the 
Invitation To Comment part of the ``SUPPLEMENTARY INFORMATION'' section 
below. Comments in electronic form should be submitted by using the 
following weblink: (https://ftcpublic.commentworks.com/ftc/hsrformchanges) (and following the instructions on the web-based form). 
Comments in paper form should be mailed or delivered to the following 
address: Federal Trade Commission, Office of the Secretary, Room H-135 
(Annex Q), 600 Pennsylvania Avenue, NW, Washington, DC 20580, (202) 
326-2252.

FOR FURTHER INFORMATION CONTACT: Robert L. Jones, Deputy Assistant 
Director, Premerger Notification Office, Bureau of Competition, Room 
302, Federal Trade Commission, Washington, DC 20580. Telephone: (202) 
326-3100. E-mail: (rjones@ftc.gov).

SUPPLEMENTARY INFORMATION:

Background

    Section 7A(d)(1) of the Act, 15 U.S.C. 18a(d)(1), directs the 
Commission, with the concurrence of the Assistant Attorney General, in 
accordance with the Administrative Procedure Act, 5 U.S.C. 553, to 
require that premerger notification be in such form and contain such 
information and documentary material as may be necessary and 
appropriate to determine whether the proposed transaction may, if 
consummated, violate the antitrust laws. Section 7A(d)(2) of the Act, 
15 U.S.C. 18a(d)(2), grants the Commission, with the concurrence of the 
Assistant Attorney General, in accordance with 5 U.S.C. 553, the 
authority to define the terms used in the Act and prescribe such other 
rules as may be necessary and appropriate to carry out the purposes of 
Sec.  7A.
    Pursuant to that authority, the Commission, with the concurrence of 
the Assistant Attorney General, developed the Rules, codified in 16 CFR 
Parts 801, 802 and 803, and the Form and its associated Instructions, 
codified at Part 803--Appendix. The Form is designed to provide the 
Commission and the Assistant Attorney General with the information and 
documentary material necessary and appropriate for an initial 
evaluation of the potential anticompetitive impact of significant 
mergers, acquisitions and certain similar transactions.
    Over time, it has become clear to the Commission that certain items 
on the Form, intended to provide substantive information to aid the 
Agencies' review, are not as helpful as originally anticipated. As 
examples, Item 3(c) requires filing parties to provide overly detailed 
information regarding the number and classes of voting securities to be 
acquired and Item 5(a) requires the reporting of revenues by Department 
of Census base year, currently 2002,\1\ which yields information that 
is typically too outdated to be of use to the Agencies. The Commission 
therefore proposes the deletion of these items on the Form, as well as 
the deletion or revision of several other items for similar reasons, as 
outlined below. The Commission proposes substantive and ministerial 
revisions, deletions and additions to streamline the Form and make it 
easier to prepare while focusing the Form on those categories of 
information the Agencies consider necessary for their initial review. 
The Commission also proposes amending certain Rules and parts of the 
Form and Instructions, as well as the addition of Items 4(d) and 7(d), 
in order to capture additional information that would significantly 
assist the Agencies in their initial review. Finally, minor changes are 
proposed to Sec. Sec. 801.1, 801.15, 801.30, 802.4, 802.21, 802.52, 
803.2 and 803.5, primarily to address minor omissions from the 
Commission's 2005 rulemaking involving unincorporated entities, and an 
amendment to Sec. 802.21 is proposed to remove the reference to the 
2001 transition period.
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    \1\ 70 FR 77312 (December 30, 2005).
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    It has also become apparent that the current Form does not solicit 
some information that would be useful to the Agencies in making an 
initial evaluation of a transaction's competitive impact. For instance, 
the Form does not require filing parties to provide current year 
revenues by the more detailed 10-digit North American Industry 
Classification System (``NAICS'') product code, nor does it require 
revenue data for products manufactured outside of, but sold into, the 
United States. Moreover, the Form does not elicit sufficient 
information about ties between acquiring investment funds and other 
entities that are associated with these acquiring entities, which have 
holdings in the same line of business as the target. Thus, the 
Commission proposes to amend the Rules, the Form and the Instructions 
to require this and other helpful information, as discussed more fully 
below.
    Substantive changes to the Rules, as well as improvements to the 
Instructions and Form, have been made on a number of occasions since 
the Premerger program began in 1978. For example, in 2001, the Rules 
and Form were significantly altered to accommodate the 2000 amendments 
to the HSR Act\2\, as well as to implement some administrative changes 
that were proposed and that received public comment in 1994.\3\ The 
Rules were also amended in 2005 to bring the treatment of non-corporate 
entities into line with the treatment of corporate entities.\4\ The 
Form was revised in 2006 to accommodate the electronic filing option 
and to update some elements to make them more useful to the Agencies' 
initial analysis.\5\ The Commission now seeks comment from the public 
on its current proposed amendments to the Rules, Form and Instructions.
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    \2\ 66 FR 8680 (February 1, 2001).
    \3\ 59 FR 30545 (June14, 1994), id. at 46365 (Sept. 8, 1994) 
(extending comment period).
    \4\ 70 FR 11502 (March 8, 2005).
    \5\ 71 FR 35995 (June 23, 2006).

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Invitation to Comment

    All persons are hereby given notice of the opportunity to submit 
written data, views, facts, and arguments pertinent to this rule 
review. Written comments must be received on or before October 18, 
2010, and may be submitted electronically or in paper form. Comments 
should refer to ``HSR Form Changes'' to facilitate the organization of 
comments. Please note that your comment--including your name and your 
state--will be placed on the public record of this proceeding, 
including on the publicly accessible FTC website, at (https://www.ftc.gov/os/publiccomments.shtm).
    Because comments will be made public, they should not include any 
sensitive personal information, such as any individual's Social 
Security number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. Comments also 
should not include any sensitive health information, such as medical 
records or other individually identifiable health information. In 
addition, comments should not include any ``[t]rade secret or any 
commercial or financial information which is obtained from any person 
and which is privileged or confidential. . . ,'' as provided in Section 
6(f) of the Federal Trade Commission Act (``FTC Act''), 15 U.S.C. 
46(f), and FTC Rule 4.10(a)(2), 16 C.F.R. 4.10(a)(2). Comments 
containing material for which confidential treatment is requested must 
be filed in paper form, must be clearly labeled ``Confidential,'' and 
must comply with FTC Rule 4.9(c), 16 C.F.R. 4.9(c).\6\
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    \6\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See FTC Rule 4.9(c), 16 
C.F.R. 4.9(c).
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    Because paper mail addressed to the FTC is subject to delay due to 
heightened security screening, please consider submitting your comments 
in electronic form. Comments filed in electronic form should be 
submitted by using the following weblink: (https://ftcpublic.commentworks.com/ftc/hsrformchanges) (and following the 
instructions on the web-based form). To ensure that the Commission 
considers an electronic comment, you must file it at (https://ftcpublic.commentworks.com/ftc/hsrformchanges) . If this document 
appears at (https://www.regulations.gov/search/Regs/home.html#home), you 
may also file an electronic comment through that website. The 
Commission will consider all comments that regulations.gov forwards to 
it. You may also visit the FTC website at (https://www.ftc.gov) to read 
the document and the news release describing it.
    A comment filed in paper form should include the ``HSR Form 
Changes'' reference both in the text and on the envelope, and should be 
mailed or delivered to the following address: Federal Trade Commission, 
Office of the Secretary, Room H-135 (Annex Q), 600 Pennsylvania Avenue, 
NW, Washington, DC 20580. The FTC is requesting that any comment filed 
in paper form be sent by courier or overnight service, if possible, 
because U.S. postal mail in the Washington area and at the Commission 
is subject to delay due to heightened security precautions.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. The Commission will consider all timely and responsive 
public comments that it receives, whether filed in paper or electronic 
form. Comments received will be available to the public on the FTC 
website, to the extent practicable, at (https://www.ftc.gov/os/publiccomments.shtm). As a matter of discretion, the Commission makes 
every effort to remove home contact information for individuals from 
the public comments it receives before placing those comments on the 
FTC website. More information, including routine uses permitted by the 
Privacy Act may be found in the FTC's privacy policy, at (https://www.ftc.gov/ftc/privacy.shtm).

Statement of Basis and Purpose of the Proposed Amendments to the Rules 
and the Form

    The Commission proposes ministerial changes in Items 1 through 3 in 
order to make the Form easier to use, as well as the revision or 
deletion of many items, such as Items 2(e), 3(b), 3(c), 4(a), 4(b), 
5(a), 5(b)(i), 5(b)(ii), 5(d), 6(a), and 6(b), which currently ask for 
information that the Agencies no longer consider necessary for their 
initial review. The Commission also proposes amending certain Rules and 
parts of the Form and Instructions, such as Items 2(d), 5(b)(iii), 
5(c), 6(c), 7 and 8 in order to capture additional information (such as 
current year revenues by 10 digit NAICS product code, including 
products manufactured outside of and sold into the United States, and 
entities associated with the acquiring person) that would significantly 
assist the Agencies in their review. The Commission also proposes the 
addition of Item 4(d), which would require filing parties to submit 
certain documents useful to the Agencies' substantive review of 
transactions, and Item 7(d), which would require filing parties to 
provide information on overlapping NAICS codes between associates of 
the acquiring person and the acquired entity(s) or assets.
    The proposed changes will eliminate the least helpful information 
requests in the Form and add requests for information that will greatly 
enhance the Agencies' review. The Commission believes the proposed 
changes will make the premerger notification process more efficient, 
and will, on balance, reduce the overall burden of completing the Form. 
The modifications to the relevant Rules, as well as the changes to the 
Form and Instructions, are described more fully below.

Part 801--Coverage Rules

801.1(d)(ii) Associate

``Associate'' in Item 7 Overlapping NAICS Codes and in Item 6(c) 
Minority Holdings

    At present, an acquiring person is required to provide information 
in its notification with respect to all entities included within it at 
the time of filing. In some instances, particularly with families of 
investment funds, entities that are commonly managed with the acquiring 
person are not included because these ``associated'' entities are not 
controlled, as defined in Sec. 801.1(b) of the Rules, by the acquiring 
Ultimate Parent Entity (``UPE''). As a result, the Agencies do not 
receive the information they need to get a complete picture of 
potential antitrust ramifications of an acquisition.
    In particular, Item 7 currently requires the person filing 
notification to identify, to its knowledge or belief, any 6-digit NAICS 
industry code in which it derives revenues and in which any other party 
to the acquisition also derives revenues (a NAICS ``overlap''). The 
information provided in response to Item 7 enables the Agencies to 
compare the products and services in which the acquired entity(s) or 
assets derive revenues with the products and services in which the 
acquiring person and any entity it controls derives revenues.
    Item 7 does not currently capture all relevant overlap information 
when an acquisition is being made by a limited partnership (``LP'') 
that is one of a number of LPs managed by the same general partner. 
Even though the general partner typically manages the LP, that

[[Page 57112]]

general partner often has the right to only a small percentage of the 
profits of the LP. The definition of control of any unincorporated 
entity\7\ requires the right to 50 percent or more of the profits or 50 
percent or more of the assets upon dissolution. Thus, the general 
partner often does not control the LP for HSR purposes, making the LP 
its own UPE. Yet, that same general partner often manages other LPs 
with holdings that derive revenues in the same NAICS code as the 
acquired entity(s) or assets. Because the general partner does not have 
HSR control over the acquiring LP and any other LPs of which it is the 
general partner, overlaps across entities under the effective control 
of the general partner are not currently captured in Item 7. This 
scenario frequently arises in the energy industry with Master Limited 
Partnerships, where potentially crucial overlaps among LPs with the 
same general partner may go undetected.
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    \7\ 16 CFR Sec.  801.1(b)(1)(ii).
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    Current Item 7 also falls short when an acquisition is being made 
by an investment fund that is one of a family of investment funds under 
common management. The acquiring investment fund is generally either 
its own UPE or possibly controlled by a limited partner that, by law, 
cannot have an active role in the management of the fund. It is not 
unusual for another investment fund under common management with the 
acquiring investment fund to have holdings that derive revenues in the 
same NAICS code as the acquired entity(s) or assets.
    The current Form may also fail to detect instances in which 
entities that are under common management with the acquiring person, 
but are not part of the same UPE (e.g., funds that are part of a family 
of investment funds), already have minority holdings of the acquired 
entity(s) or assets. While holders of five percent or greater minority 
interests in the acquired entity(s) are disclosed in response to Item 
6(b), the Agencies may not be aware that one or more of such holders is 
under common management with the acquiring person.
    In these instances, because the entities are under common 
management, requiring reporting of where these entities' holdings 
overlap with the acquired entity(s) or assets would provide a more 
complete and accurate picture of the competitive impact of the 
acquisition. The Commission believes that capturing this information in 
the manner proposed herein would allow for a more complete analysis of 
the competitive impact of these types of transactions without imposing 
substantial additional burden on the acquiring person. Based on past 
experience, only a relatively small percentage of all acquiring persons 
will fall into the categories that would cause this additional 
notification requirement.\8\
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    \8\ Investment funds often form limited partnerships to make 
acquisitions. For FY07, 445 of the 2,201 total transactions (20.2%) 
featured a limited partnership as an acquiring person that 
potentially would have had to report information on associates.
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    To capture this information on associated entities, the Commission 
proposes three changes. First, the term ``associate'' would be added in 
new Sec. 801.1(d)(2) to define entities that are under common 
management with the acquiring person, but are not under common HSR 
control with the acquiring person. Examples of such associates include, 
but are not limited to, general partners of a limited partnership, 
other partnerships with the same general partner, other investment 
funds whose investments are managed by a common entity or under a 
common investment management agreement, and investment advisers of a 
fund.
    Second, the instructions to Item 7 would be amended as follows:

 Item 7(a) would require reporting any 6-digit NAICS industry code in 
which the acquiring person, or any associate of the acquiring person, 
derives revenues and in which the acquired entity(s) or assets also 
derive revenues;
 Item 7(b)(i) would require reporting the name of any entity(s) 
controlled by the acquiring person that derived revenues in the 
overlapping NAICS code in the most recent fiscal year and Item 7(b)(ii) 
would require reporting the name of any entity(s) controlled by an 
associate of the acquiring person that derived revenues in the 
overlapping NAICS code in the most recent fiscal year; and
 Item 7(c) would require reporting the geographic information for any 
entity(s) controlled by the acquiring person that derived revenues in 
the overlapping NAICS code in the most recent fiscal year and Item 7(d) 
would require reporting the geographic information for any entity(s) 
controlled by an associate of the acquiring person that derived 
revenues in the overlapping NAICS code in the most recent fiscal year.

    Third, the Commission also proposes amending Item 6(c) to require 
an acquiring person to report, based on its knowledge or belief, all 
its associates' holdings of voting securities and non-corporate 
interests of 5 percent or more and less than 50 percent in entities 
having 6-digit NAICS industry code overlaps with the acquired entity(s) 
or assets. The proposed changes to Item 6(c), as well as more details 
on the proposed changes to Item 7, are discussed more fully below.

Part 803-Transmittal Rules

    As a result of the proposed changes to the Notification and Report 
Form and its Instructions, certain sections of Part 803 need to be 
amended in order to be consistent with the Form. Specifically, minor 
ministerial changes are required to Sec. 803.2.

Part 803--Appendix: Premerger Notification and Report Form

General Instructions

Item by Item

    * * *

Fee Information

    The 2001 revisions to the Form\9\ expanded the Fee Information Item 
to obtain more information concerning electronic wire transfers 
(``EWT''), the preferred method of paying the HSR filing fee. The 
additional information concerning this method of payment, such as the 
Taxpayer Identification Number (or Social Security number for Natural 
Persons), is necessary under 31 U.S.C. Sec. 7701. Purely ministerial 
changes, such as repositioning and reformatting, are proposed in this 
section of the Form to make it easier to complete.
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    \9\ 66 FR 8680 (February 1, 2001).
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    * * *

Privacy Act Statement

    The Privacy Act Statement on the Form has been amended to reflect 
the change in civil penalties, effective on February 9, 2009, from a 
maximum of $11,000 per day to a maximum of $16,000 per day.\10\
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    \10\ 74 FR 857 (January 9, 2009).
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Items 1-3

    Items 1 through 3 require filing parties to supply basic 
information about the transaction and the parties to the transaction. 
The Commission proposes both ministerial and substantive changes to 
these items.

Item 1

    Item 1 of the Form seeks information about the identity of the 
filing party, its contact information, whether it is an acquiring or 
acquired person or both, the definition of its fiscal year and what 
type of entity it is.

[[Page 57113]]

    The Commission proposes to reorganize Item 1 so that it is easier 
to complete. Item 1(a), for example, which currently asks for ``Name 
and Headquarters address of person filing'' would be amended to be 
consistent with Items 1(g) and 1(h) in specifically requesting line by 
line address information. In addition, Item 1(a) would ask for a 
website address to make it easier for the Agencies to learn more about 
the filing person, as well as to find information that might relate to 
the structure of the transaction described in Item 3(a). If a filer has 
several websites, it should use its best judgment as to which website 
would be the most relevant for Agency staff. It is understood that some 
parties may not have a relevant website to reference.
    The Commission also proposes to revise Item 1(g), which currently 
asks for a contact person in case of questions or problems with the 
Form. PNO staff frequently finds it difficult to quickly reach the 
contact person to resolve any outstanding issues with a filing. To 
avoid unnecessary delay in processing the filing, the Commission 
proposes that filers provide a secondary contact person. The secondary 
contact information will only be used in the event the primary contact 
is unavailable or if the Agencies are specifically instructed by the 
parties to contact the secondary person. Given the time-sensitive 
nature of HSR filings and the problems that arise when information is 
incorrect or missing from the filing, having a second contact person is 
a reasonable safeguard that imposes minimal additional burden on the 
parties.

Item 2

    Item 2 requires the reporting person to identify the ultimate 
parent entities of the parties in the transaction as well as to 
identify the type and value of the transaction. The Commission proposes 
minor, non-substantive format changes, such as repositioning and 
reformatting text, to Items 2(a), (b) and (c) to improve the 
readability of the Form. There are no proposed substantive changes to 
Items 2(a), (b) and (c).

Item 2(d)

    As discussed below, the Commission proposes removing the obligation 
of parties to provide certain details pertaining to assets, non-
corporate interests and voting securities of the acquired person held 
by the acquiring party prior and subsequent to the acquisition, 
including, for example, the classes of shares to be acquired. The 
percentage of voting securities and non-corporate interests held both 
prior to, and as a result of, the acquisition are necessary, however, 
for the Agencies to determine that the parties are correctly adhering 
to the Act and to conduct a substantive review of the transaction.
    Thus, the Commission proposes to modify Item 2(d) to include the 
percentage and value of voting securities and non-corporate interests 
of the acquired person held prior to and as a result of the 
acquisition.\11\ Item 2(d) will continue to require parties to identify 
the value of assets to be held as a result of the acquisition, and to 
provide the aggregate total value of the acquisition. Additionally, the 
Commission proposes reformatting Item 2(d) into an expanded table 
format for ease of use by the filer and the Agencies.
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    \11\ The revised Item 2(d) contemplates an overall percentage of 
all classes of voting securities held in the target. Filing parties 
should use 16 C.F.R. Sec. 801.12 as necessary to calculate the 
appropriate percentage of all classes of voting securities. The 
percentage of non-corporate interests should reflect economic 
interests.
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    This approach is in line with the 2005 amendments to the Rules 
which require the reporting of acquisitions of control of 
unincorporated entities and reconcile, as much as possible, the Rules' 
treatment of unincorporated and incorporated entities. Several changes 
were made to the Form at that time to reflect the new reportability of 
these acquisitions.\12\ The Commission inadvertently failed to amend 
Item 2(d) at that time to include a reference to non-corporate 
interests and proposes to do so now.
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    \12\ 70 FR 11502 (March 8, 2005).
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Item 2(e)

    Item 2(e) was added to the Form in 2001 to request the name of the 
person(s) who performed any fair market valuation used to determine the 
total value of the transaction.\13\ The reasoning was that the new 
tiered filing fee structure made the determination of the fair market 
value more important than had previously been the case, and identifying 
a contact person familiar with the fair market valuation methodology 
would benefit the Agencies in the event that a valuation question 
arose.
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    \13\ 66 FR 8680 (February 1, 2001).
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    The 2001 rulemaking acknowledges that in the event of questions, 
the Agencies will likely contact the Item 1(g) contact person first. 
``Although the agencies would initially contact the person listed for 
that purpose in Items 1(g) and (h) should any questions arise regarding 
information supplied on the Form, this addition should help the parties 
and the agencies pinpoint who would be most knowledgeable on the issue 
of valuation.''\14\
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    \14\ Id.
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    The additional information obtained by Item 2(e) has not proven to 
be useful. In all cases, the contact person in Item 1(g) and (h) has 
been the person contacted. The contact person, of course, can point the 
Agencies to the person who prepared the valuation, thus making the 
direct contact information in Item 2(e) unnecessary. In the interest of 
reducing the burden on the parties, as small as it may be in this 
instance, the Commission proposes to delete Item 2(e).

Item 3(a)

    In Item 3(a), filing parties are required to provide information on 
the filing parties, the contours of the transaction, the amount and 
form of consideration, and the time line for closing. The Commission 
proposes to amend Item 3(a) to require that, in the case of 
acquisitions of voting securities or non-corporate interests, filing 
parties list the names of all issuers and non-corporate entities whose 
shares or interests are being acquired. In the case of asset 
acquisitions, filing parties would be required to describe the business 
the assets being acquired comprise. If there are additional filings, 
such as shareholder backside filings, associated with the transaction, 
filing parties would be required to list those, as well as any special 
circumstances that apply to the filing, such as whether part of the 
transaction is exempt under one of the exemptions found in Section 802. 
These amendments to Item 3(a) will facilitate the Agencies' review and, 
on balance, reduce the burden on filers because they will allow Items 
3(b) and 3(c) to be eliminated as discussed below.

Item 3(b)

    Item 3(b) requests a description of the assets to be acquired, a 
description of any assets previously acquired from the acquired person 
and currently held by the acquiring person, and a description of assets 
held by any unincorporated entities that are being acquired. The 
Agencies have found that much of this level of detail is not helpful in 
the initial review of the transaction. Given the proposed amendment to 
Item 3(a) to include a description of the assets being acquired in a 
transaction, the Commission proposes to delete Item 3(b).

Item 3(c)

    Item 3(c) requires parties to provide a list and description of 
voting and non-voting securities to be acquired,

[[Page 57114]]

including the classes, the rights of each class, the total number of 
outstanding shares post-acquisition, the shares to be acquired, each 
class of share to be held by each acquiring person, and the dollar 
value of the shares to be acquired. First added in 1978,\15\ this item 
was amended in 1987 to eliminate the need for a detailed response when 
100% of the voting securities of the acquired entity are being 
acquired, requiring only that parties provide the total dollar value of 
the transaction in these instances.\16\
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    \15\ 43 FR 33450 (July 31, 1978).
    \16\ 52 FR 7066 (March 6, 1987). Note this was Item 2(c) at the 
time.
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    The Commission has further determined that obtaining the detailed 
information currently required in Item 3(c) for acquisitions of less 
than 100% does not significantly aid the Agencies in their initial 
review. It has determined that it is sufficient for initial review 
purposes that the parties provide information as to the names of all 
issuers and non-corporate entities whose shares or interests are being 
acquired, and the percentage and value of voting securities of the 
acquired entity or interests in the non-corporate entity held by the 
acquiring person prior and subsequent to the transaction. As discussed 
above, such information will be required under the proposed revisions 
to Item 2(d) and Item 3(a) of the Form. The Commission thus proposes 
deleting Item 3(c).

Item 3(d)

    The Commission proposes redesignating Item 3(d), which requires 
copies of all documents that constitute the agreement(s) between the 
parties, to Item 3(b) to reflect the proposed elimination of former 
Items 3(b) and 3(c). Further, the Commission proposes amending the 
Instructions to the Form for the new Item 3(b) to make clear that all 
Agreements Not to Compete are required to be submitted with the Form. 
The Instructions would specify that documents that constitute the 
agreement(s) (e.g., a Letter of Intent, Merger Agreement or Purchase 
and Sale Agreement) must be executed, while Agreements Not to Compete 
may be provided in draft form if that is the most recent version.\17\ 
There are no proposed substantive changes to Item 3(d).
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    \17\ If parties are filing on an executed Letter of Intent, they 
may also submit a draft of the definitive agreement. Note that 
transactions subject to Sec. 801.30 and bankruptcies under 11 USC 
Sec. 363 do not require an executed agreement or letter of intent.
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Items 4-6

Item 4

    Item 4 seeks various documents, including some created in the 
ordinary course of business and some produced by the parties in 
connection with the current transaction. The Commission is proposing 
changes to reduce the burden of producing documents in response to 
Items 4(a) and (b). The Commission also proposes the addition of new 
Item 4(d) which would require filing parties to submit certain 
documents useful to the Agencies' substantive review of transactions.

Item 4(a) Documents filed with the United States Securities and 
Exchange Commission (``SEC'')

    Item 4(a) seeks materials submitted to the SEC, including a 
company's most recent proxy statement, its most recent 10-K filing, all 
10-Q and 8-K filings made since the end of the period reflected in the 
most recent 10-K, any registration statement filed in connection with 
the transaction, and, if the acquisition is a tender offer, the 
Schedule TO. Inclusion of these documents under Item 4(a) was 
``intended to provide financial information about the reporting person, 
information about its operations and those of its subsidiaries, and 
occasionally about the reported transaction itself.''\18\
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    \18\ 46 FR 38710 (July 29, 1981).
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    The Commission initially required parties to provide paper copies 
of the required SEC filings. In doing so, the Commission stated that 
although the documents were available from the SEC, the Agency staff 
would be under severe time constraints in reviewing filings under the 
Act and that obtaining the required documents for each reporting person 
would be extremely time-consuming.\19\ However, with the advent of the 
Internet and the SEC's EDGAR database, the Commission determined that 
staff could quickly and easily obtain the relevant information and that 
the provision by the parties of electronic links to the documents would 
be sufficient. Therefore, in 2005, the Commission amended the Form to 
allow filers to provide Internet links to the documents required in 
Item 4(a) and Item 4(b).\20\
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    \19\ 43 FR 33450 (July 31, 1978).
    \20\ 70 FR 73369 (December 12, 2005).
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    A number of filers have taken advantage of this change and provide 
Internet links in Item 4(a). Because virtually all filings are still 
made in paper form, however, Agency staff cannot simply click on the 
link and be directed to the document. Rather, to use these links, staff 
must type out long web addresses. The length of these addresses 
increases the chance that either the filer or the Agency staff might 
enter an incorrect address and delay the processing of the filing.
    In the meantime, the sophistication of the SEC website has 
increased and now provides for immediate access to all filed materials. 
Thus, the Commission now proposes further simplifying Item 4(a) by only 
requiring filers to provide a list of all entities within the person 
filing notification, including the UPE, that file annual reports (10-K 
or 20-F filings) with the SEC, and to provide the Central Index Key 
number (CIK)\21\ for each entity. Such information will provide staff 
with sufficient information to find and review these documents easily.
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    \21\ A Central Index Key or CIK number is a number given to an 
individual or company by the United States Securities and Exchange 
Commission. The number is used to identify the filings of a company, 
person or entity in several online databases, including EDGAR.
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Item 4(b) Annual Reports, Annual Audit Reports, and Regularly Prepared 
Balance Sheets

    Item 4(b) requires parties to provide the most recent annual 
reports and annual audit reports of the person filing notification and 
of each unconsolidated United States issuer included within the person. 
The person filing must also provide, if different, the most recent 
regularly prepared balance sheet of the person filing notification and 
of each unconsolidated United States issuer included within the person.
    It is often challenging for filing parties to provide balance 
sheets, particularly where the filing person is a natural person or a 
foreign entity, as these balance sheets are not readily available. 
Typically, these balance sheets contain no substantive information on 
the filing party, and are merely a snapshot of the party's assets and 
liabilities. The Commission has determined, based on the Agencies' 
experience, that the information contained in the most recently 
prepared balance sheet is not useful beyond providing evidence, where 
necessary, that the party has sufficient assets to meet the size of 
person test.
    Thus, the Commission proposes the elimination of Item 4(b)'s 
requirement to submit a company's most recent regularly prepared 
balance sheet. Parties must continue to provide the most recent annual 
report and/or audit report for the filing person and any unconsolidated 
U.S. issuers, because these reports are often quite useful in 
understanding the business of the filing person. In addition, the 
Commission proposes expanding the requirement to submit annual reports 
and/or audit reports to include any unconsolidated

[[Page 57115]]

non-corporate U.S. entities. This proposed change will bring this item 
in line with other changes that attempt to reconcile the treatment of 
corporations and unincorporated entities.\22\ For natural persons, the 
Commission proposes requiring the person to submit only the most recent 
annual report and/or audit report from the highest level entity(s) that 
the person controls. Personal balance sheets from natural persons would 
thus no longer be required.
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    \22\ 70 FR 11502 (March 8, 2005).
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    As balance sheets will no longer be required, filing parties will 
have to be more cognizant of demonstrating that they meet the size of 
person test when applicable. If the annual report or annual audit 
report does not show sales or assets sufficient to meet the size of 
person test, and the size of person test is relevant given the size of 
the transaction, the parties must stipulate in Item 4(b) that the 
filing person meets the test.
    The Commission believes that the proposed changes to Items 4(a) and 
4(b) will reduce the burden of producing documents for filing parties.

Proposed Item 4(d): Additional Documents

    Certain categories of documents typically created in the course of 
a transaction are quite useful for the Agencies' initial substantive 
analysis of transactions but are not always provided because parties 
have differing interpretations as to whether they are called for under 
current Item 4(c). The Commission thus proposes new Item 4(d) to 
enumerate these documents and require their submission with the Form.

Item 4(d)(i): Offering Memoranda

    When a company is preparing to put itself up for sale, it will 
often draft or hire a third party to draft a confidential information 
memorandum that lays out the details of the company for prospective 
buyers. Such offering memoranda are extremely valuable to the Agencies 
in their initial review. Most parties already submit these along with 
their HSR Filings and proposed Item 4(d)(i), which would require filing 
parties to do so, should not create any additional burden for them or 
substantial additional burden for others. Under proposed Item 4(d)(i), 
offering memoranda must be submitted regardless of whether they were 
prepared by or for any officer(s) or director(s) (or, in the case of 
unincorporated entities, individuals exercising similar functions) for 
the purpose of evaluating or analyzing the acquisition with respect to 
market shares, competition, competitors, markets, potential for sales 
growth or expansion into product or geographic markets. Any such study, 
survey, analysis or report will only be responsive to Item 4(d)(i) if 
it also contains some reference to the acquired entity(s) or 
assets.\23\ If the seller circulates an existing presentation to 
provide an overview of the company to a prospective buyer(s), this type 
of document would be the equivalent of an offering memorandum for the 
purposes of Item 4(d)(i) and must be submitted. The Commission 
recognizes that without a date cutoff, a search for these documents 
could be extremely burdensome. Accordingly, the Commission proposes a 
limit of two years before the date of filing for documents responsive 
to this item. This proposed time frame is consistent with the specified 
``relevant time period''of two years as applicable to second requests 
in the 2006 merger process reforms.\24\
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    \23\ This requirement is intended to capture documents from both 
the buyer and the seller.
    \24\ See REFORMS TO THE MERGER REVIEW PROCESS (p.19) announced 
by then Chairman Deborah Platt Majoras on February 16, 2006. (https://www.ftc.gov/os/2006/02/mergerreviewprocess.pdf)
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Item 4(d)(ii): Materials Prepared by Investment Bankers, Consultants or 
Other Third Party Advisors

    Investment bankers, consultants or other third party advisors are 
often active at all stages of a transaction, generating due diligence, 
valuation and other broad categories of materials. Some of these 
materials contain competition-related content and can be invaluable to 
the Agencies in their initial review of the potential competitive 
impact of a transaction. Many parties already submit such competition-
related third party materials along with their HSR Filings and proposed 
Item 4(d)(ii), which would require filing parties to do so, should not 
create substantial additional burden for them or substantial additional 
burden for others. Under proposed Item 4(d)(ii), studies, surveys, 
analyses and reports prepared by investment bankers, consultants or 
other third party advisors must be submitted if they were prepared for 
any officer(s) or director(s) (or, in the case of unincorporated 
entities, individuals exercising similar functions) for the purpose of 
evaluating or analyzing market shares, competition, competitors, 
markets, potential for sales growth or expansion into product or 
geographic markets. Any such study, survey, analysis or report will 
only be responsive to Item 4(d)(ii) if it also contains some reference 
to the acquired entity(s) or assets.\25\ If such studies, surveys, 
analyses and reports are found in the files of any officer(s) or 
director(s) (or, in the case of unincorporated entities, individuals 
exercising similar functions), they should be deemed to have been 
prepared for that individual. For the reasons state above, the 
Commission also proposes a limit of two years before the date of filing 
for documents responsive to this item.
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    \25\ This requirement is intended to capture documents from both 
the buyer and the seller.
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Item 4(d)(iii): Documents Discussing Synergies and/or Efficiencies

    Documents that discuss synergies and/or efficiencies likely to 
result from a transaction can be very useful in the Agencies' initial 
review. Proposed Item 4(d)(iii) would require filing parties to submit 
studies, surveys, analyses and reports evaluating or analyzing such 
synergies and/or efficiencies if they were prepared by or for any 
officer(s) or director(s) (or, in the case of unincorporated entities, 
individuals exercising similar functions) for the purpose of evaluating 
or analyzing the acquisition. Financial models without stated 
assumptions need not be provided in response to this item. As many 
filing parties already submit such documents, this item should present 
little additional burden for them or substantial additional burden for 
others.
    The proposed instructions to Item 4(d) would read as follows:

Item 4(d) - Additional Documents

 For each category below, indicate (if not contained in the document 
itself) the date of preparation, and the name of the company or 
organization that prepared each such document.
 Item 4(d)(i): Provide all offering memoranda (or documents that served 
that function) that reference the acquired entity(s) or assets. 
Documents responsive to this item are limited to those produced up to 
two years before the date of filing.
 Item 4(d)(ii): Provide all studies, surveys, analyses and reports 
prepared by investment bankers, consultants or other third party 
advisors if they were prepared for any officer(s) or director(s) (or, 
in the case of unincorporated entities, individuals exercising similar 
functions) for the purpose of evaluating or analyzing market shares, 
competition, competitors, markets, potential for sales growth or 
expansion into product or geographic markets, and that also reference 
the

[[Page 57116]]

acquired entity(s) or assets. Documents responsive to this item are 
limited to those produced up to two years before the date of filing.
 Item 4(d)(iii): Provide all studies, surveys, analyses and reports 
evaluating or analyzing synergies and/or efficiencies if they were 
prepared by or for any officer(s) or director(s) (or, in the case of 
unincorporated entities, individuals exercising similar functions) for 
the purpose of evaluating or analyzing the acquisition. Financial 
models without stated assumptions need not be provided in response to 
this item.

Item 5

    Item 5 requires persons to submit information regarding dollar 
revenues and lines of commerce with respect to operations conducted 
within the United States during a company's most recently completed 
year and the base year, currently 2002.\26\ All filing persons must 
submit certain data at the 6-digit NAICS industry code level. To the 
extent that dollar revenues are derived from manufacturing operations 
(NAICS Sectors 31-33), data must also be provided at the 7-digit 
product code level for the most recent year and at the 10-digit product 
code level for the base year.
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    \26\ 70 FR 77312 (December 30, 2005).
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    The Item 5 reporting requirement was first based on Standard 
Industrial Classification (``SIC'') codes, and at the time it was 
contemplated that such a reporting requirement would not be unduly 
burdensome. Reporting persons were presumed to compile yearly SIC-based 
data for submission to the Bureau of Census and, thus, would have such 
information readily available.\27\ This presumption remained in place 
when SIC codes were supplanted by NAICS codes in 2001.\28\
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    \27\ 43 FR 33450 (July 31, 1978).
    \28\ 66 FR 35541 (July 6, 2001).
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    Based on informal input from practitioners, it appears that filing 
parties generally do not rely on data compiled for previous Census 
requirements in responding to Item 5, either because they were never 
compiled or are no longer available. In fact, the appropriate NAICS 
codes and underlying revenues generally are determined by the parties 
when preparing the filing. Because the parties do not, as the 
Commission believed they would, reference previously compiled data, the 
burden of gathering this information is not as minimal as the 
Commission originally believed. This is particularly true for the base 
year requirement in Items 5(a) and 5(b)(i).
    The incorporation of a base year in the Form was intended to 
provide context for the company's most recent year's revenues. The 
reasoning was that the Agencies would be able to see how much a given 
industry had grown in the span of time between the base year and the 
most current year. The base year was intended to coincide with the 
publication schedules of the quinquennial economic censuses and the 
Annual Survey of Manufacturers, publications that serve as the most 
readily available and reliable statistical sources of industry 
components and market universe to which individual company product and 
revenue data can be compared.
    Even though the U.S. Economic Census occurs every five years, it 
can take as long as three years for the results to be published. 
Consequently, new base years are not adopted by the Commission until 
well after the relevant census occurred. For example, the current 2002 
base year was not adopted by the Commission until the end of 2005.\29\ 
The result is that parties are required to assemble data that may be as 
much as eight years old. This is often a difficult task, particularly 
in the case of assets acquired since the base year. Moreover, comparing 
current revenues of the parties to an economic universe that is at a 
minimum three and at a maximum eight years old is of minimal value to 
the Agencies in analyzing the potential competitive impact of a 
transaction. The Commission, therefore, proposes eliminating the base 
year reporting requirements in Items 5(a) and 5(b)(i).
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    \29\ 70 FR 77312 (December 30, 2005).
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    Once the base year requirements are removed, Item 5(b)(ii), which 
requires a listing of revenues for products added or deleted between 
the base year and the most recent year, becomes moot. The Commission, 
therefore, also proposes deleting Item 5(b)(ii).
    Item 5(b)(iii) requires parties to list dollar revenues by 
manufactured product class (7-digit) for the most recent year and Item 
5(c) requires parties to submit revenues by non-manufacturing industry 
code (6-digit) for the most recent year. To provide the Agencies with a 
more accurate view of recent revenues, the Commission proposes to 
revise Item 5(b)(iii) by substituting the reporting of the more precise 
10-digit product codes for manufactured products for the most recent 
year in place of the currently required 7-digit product classes. Based 
on informal input from practitioners, filing parties generally find 
these revenues to be far less burdensome to compile than base year 
revenues, and 10-digit product codes are typically prepared by the 
parties as part of the analysis of the transaction to identify 
potentially problematic overlaps. The Commission thus proposes that 
Item 5 be revised to have only one reporting section, proposed Item 
5(a), where filing parties will list manufacturing revenues by 10-digit 
product codes and non-manufacturing revenues by 6-digit industry codes 
for the most recent year. The Commission believes this change will 
result in the Agencies getting more useful NAICS code information in 
Item 5 than they currently receive.
    In addition, the Commission proposes the elimination of the million 
dollar minimum applicable to current Item 5(c). The million dollar 
minimum was based on the way filing persons reported non-manufacturing 
data to the Bureau of Census. As discussed above, filing parties may 
not rely on data compiled for Census in responding to Item 5, and, in 
fact, generally determine the appropriate NAICS codes in response to 
Item 5 at the time of filing. In addition, this million dollar minimum 
often creates confusion about whether there is a need to report an 
overlap in Item 7. For instance, if an acquiring person has less than 
$1 million in sales in a non-manufacturing NAICS industry code and does 
not report that code in the current Item 5(c), it still is required to 
report an overlap in Item 7 if the acquired person also derives revenue 
in that same non-manufacturing NAICS industry code; however, most 
filing parties do not indicate an overlap in Item 7 in this instance, 
assuming the million dollar minimum in Item 5(c) means there are 
essentially no revenues to report in that code. The elimination of the 
million dollar minimum would thus eliminate confusion for filing 
parties and ensure that the Agencies get this overlap information.
    Occasionally a filing party will not have revenue to report in 
proposed Item 5. To speed review of the Form, the Commission proposes 
inserting a checkbox indicating ``None'' into the Form at Item 5 in the 
event the filing party has no Item 5 information to report. Parties 
checking the box will be required to provide a brief explanation for 
the lack of reportable Item 5 information. Explanations may include, 
but are not limited to, situations where:
    1. An acquiring person is newly-formed in a transaction valued in 
excess of $200 million (as adjusted);
    2. An acquiring person is foreign and has no sales in or into the 
U.S;
    3. A filing person is a development stage company that has not yet 
generated sales; or

[[Page 57117]]

    4. A filing person's holding is an exclusive license for 
intellectual property related to a product that has not yet gone into 
production.

Item 5 Foreign Manufactured Products

    Section 803.2(c)(1) of the Rules instructs filing persons to 
provide information in response to Items 5, 7, and 8 ``with respect to 
operations conducted within the United States.'' Filing persons are not 
required to submit NAICS code information on a detailed manufacturing 
basis for products they manufacture outside the United States even if 
they sell the products in the United States. For example, if a filing 
person manufactured a product in Canada, imported it into the United 
States, and sold that product at the wholesale or retail level, the 
filing person would report revenues derived from those sales in current 
Item 5(c) using a wholesale or retail 6-digit NAICS industry code. The 
filing person would not be required to identify the product it 
manufactured in Canada using the more detailed 10-digit manufacturing 
product codes that would have been required had the product been 
manufactured in the United States.
    Absent NAICS code information at the manufacturing level, the 
Agencies have found it very difficult to determine whether a filing 
person that manufactures products outside the United States but sells 
them in the U.S. may be involved in manufacturing activities similar to 
those of another party to the transaction. As foreign imports and their 
effect on the nation's economy have increased, this information has 
become more important. Accordingly, the Commission believes that 10-
digit NAICS product code information concerning products manufactured 
outside the U.S. that are sold in or into the U.S. at the wholesale or 
retail level would provide a more complete picture of the impact of the 
transaction at the initial review stage.
    Consistent with other proposed changes to Item 5, the Commission 
proposes to modify the Form to require filing persons to identify the 
10-digit NAICS product codes and revenues for each product they 
manufacture outside the U.S. and sell in the U.S. at the wholesale or 
retail level, or that they sell directly to customers in the U.S. 
Filing parties would include 10-digit NAICS product codes and revenues 
for such foreign manufactured products only for the most recent year in 
proposed Item 5(a). Sales made directly into the U.S. would be reported 
in a manufacturing code while sales made in to the U.S. through a 
wholesale operation within the same person would be reported in both 
manufacturing (transfer price) and wholesale or retail (sales price) 
codes.\30\ This information will aid the Agencies in their initial 
review and, as the provision of the 10-digit NAICS information is based 
on the most recent year, it should not impose a significant additional 
burden on filing persons.
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    \30\ Reporting in this manner is in line with current practice 
when companies have both domestic manufacturing and wholesale or 
retail operations.
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    The Commission therefore proposes to revise the instructions to new 
Item 5(a) to read as follows:

 Item 5(a): Provide 6-digit NAICS industry data concerning the 
aggregate operations of the person filing notification for the most 
recent year in NAICS Sectors other than 31-33 (non-manufacturing 
industries) in which the person engaged and 10-digit NAICS product code 
data for each product code within NAICS Sectors 31-33 (manufacturing 
industries) in which the person engaged, including revenues for each 
product manufactured outside the U.S. but sold in or into the U.S. 
Sales made directly into the U.S. should be reported in a manufacturing 
code. Sales made into the U.S. through a wholesale or retail operation 
within the same person should be reported in both manufacturing 
(transfer price) and wholesale or retail (sales price) codes. If such 
data have not been compiled for the most recent year, estimates of 
dollar revenues by 6-digit NAICS industry codes and 10-digit NAICS 
product codes may be provided if a statement describing the method of 
estimation is furnished.

In conjunction with this proposed change to Item 5, the Commission 
proposes deleting Sec. 803.2(c)(1) to remove the limitation to 
operations conducted within the U.S.

Item 5(d)

    Item 5(d) requires filing parties to provide certain information 
with regard to the formation of a joint venture (``JV''), including the 
name and address of the JV in Item 5(d)(i); a description of the 
contributions that each person forming the JV has agreed to make in 
Item 5(d)(ii)(A); a description of any contracts or agreements related 
to the JV and a description of any credit guarantees or obligations 
applicable to the JV in Items 5(d)(ii)(B) and (C); the consideration 
which each person forming the JV will receive in Item 5(d)(ii)(D); the 
business in which the JV will engage in Item 5(d)(iii); and the 
expected source of the JV's revenues by NAICS code in Item 5(d)(iv).
    Informal discussions with FTC and Antitrust Division staff have 
revealed that some of this information, such as the description of the 
contributions that each person forming the JV has agreed to make, the 
consideration which each forming person will receive, the business in 
which the JV will engage, and the source of the JV's revenues by NAICS 
code, is crucial to the Agencies' initial analysis of the joint 
venture's competitive impact; however, other parts of Item 5(d) are not 
as important to staff's substantive analysis of the JV. The name and 
the address of the JV, a description of any contracts or agreements 
whereby the JV will obtain assets or capital from sources other than 
the persons forming it (as opposed to the formation agreement), and a 
description of any credit guarantees or obligations applicable to the 
JV provide the Agencies with little helpful information for their 
initial review. The Commission therefore proposes to delete Item 
5(d)(i) and Items 5(d)(ii)(B) and (C) from the Form.
    The Commission also proposes to revise Item 5(d)(iv) to require 
information on the expected source of the JV's dollar revenues by 6-
digit NAICS industry codes (non-manufacturing) and 10-digit NAICS 
product codes (manufacturing) to be consistent with the proposal to 
require 10-digit NAICS product codes for the most recent year in Item 
5(a) as discussed above.
    Finally, the Commission proposes redesignating Item 5(d) to Item 
5(b) to reflect the proposed changes to this item and renumbering the 
subsections within Item 5(b).

Item 6(a) Entities within person filing notification

    Item 6(a) requires information concerning entities within the party 
filing notification: the acquiring person must list all entities within 
it having total assets of $10 million or more, including foreign 
entities, and the acquired person must list all entities within the 
acquired entity, including foreign entities.
    Over the course of thirty years, it has become clear that the value 
of such detailed information in Item 6(a) is limited. Compiling a list 
of the name and street address of every entity within a person, 
regardless of whether the entity has a nexus with the U.S., can be 
often quite burdensome for filing parties, particularly with respect to 
foreign addresses. The Commission thus proposes to limit the entities 
that must

[[Page 57118]]

be listed in Item 6(a) to those located in the U.S. and those foreign 
entities that have sales in or into the U.S.\31\ In addition, the 
Commission believes that identifying the street addresses of these 
entities is not necessary to the Agencies' initial premerger review and 
proposes limiting responses in Item 6(a) to a list of responsive 
entities with only city and state or city and foreign country 
designations.
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    \31\ Under the proposal, it is permissible for a filing person 
to report all entities within it in response to Item 6(a).
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Item 6(b) Shareholders of Person Filing Notification and Item 6(c) 
Holdings of Person Filing Notification

    Item 6(b) of the Form currently requires the filing person to 
identify shareholders holding five percent or more of the voting 
securities of any entity included within the filing person (including 
the ultimate parent entity) having total assets of $10 million or more. 
For e