– Agree. K Walsh concurs.
Sent: Wednesday, November 14, 2012 9:16 PM
To: Verne, B. Michael
Subject: HIGHLY CONFIDENTIAL
Thisis a question about "associate" relationships under 16 CFR 801.1(d)(2).
Afamily of investment funds has four funds, Fund I, Fund II, Fund III, and FundIV, each of which is a limited partnership and its own ultimate parent entityfor HSR purposes. Fund I plans to make a filing in connection with a reportableacquisition. The general partner of Fund I is GP I, a partnership that hasthree managers, A, B, and C, each of whom is a natural person and a generalpartner of GP 1. GP I is not the general partner of any other fund or entity anddoes not manage any other fund or entity. Indeed, each of Funds II, III, and IVhas a different general partner, GP II, GP III, and GP IV, respectively. Eachof GP II, GP III, and GP IV is a partnership. GP II and GP III are managed bytheir own general partners, who are natural persons. GP IV is managed by anLLC, which in turn is managed by three natural' persons who are its members.
Themanagers of GP II are the natural persons A, B, and C who also manage GP 1. Themanagers of GP III include A, B, and C, but also one other natural person, D.The managers of the LLC (which manages GP IV) are A, B, C, and D.
A,B, C, and D are employees of a corporation, Admin Corp., that is under contractto provide administrative services to all four funds and their managingentities. Admin Corp. is owned by A, B, C, and another natural person, E.
A,B, C, and D, manage their respective entities collectively, but none of themhas the authority to make investment or management decisions for those entitieson his/her own.
Underthe above scenario, we believe that GP I is a "managing entity" forpurposes of the "associate" analysis under 16 CFR 801.1(d)(2), butthat none of Funds II, III, and IV is an "associate" of Fund Ibecause the only connection between the funds is through natural persons whoare employees of Admin Corp. and who have no independent individual authorityto manage any of the funds. See Examples 7 and 8 under 16 CFR 801.1(d)(2).