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Date

Tags:

Rule
801.10
Staff
Sam Sheinberg
Response/Comments

 The board can determine that the value is in excess of $807.5 million.

Question

From: Sheinberg, Samuel I.


Sent:
Thursday, December 21, 2017 9:45:19 AM


To:
 [Redacted]


Cc:
[Redacted]


Subject:
RE: Question about Asset Valuation


Auto forwarded by a Rule

 

[Redacted]

 

The board can determine that the value is in excess of $807.5 million.

 

Happy holidays,

Sam

 

From: [Redacted]

 


Sent: Wednesday, December 20, 2017 5:38 PM

 


To: Walsh, Kathryn E.; Berg, Karen E.; Carson, Timothy; Gillis, Diana L.; Shaffer, Kristin; Sheinberg, Samuel I.; Whitehead, Nora

 


Subject: FW: Question about Asset Valuation

 

Dear Sir or Madam,

 

I hope you confirm something for me.

 

A, the acquiring party, will become the sole member of a large non-profit corporation B.  Under 801.2(f)(3), this is an asset acquisition.  A will pay no consideration for the assets.  Under 801.10(b) and 801.10(c)(3), A’s Board has to determine the fair market value of the assets acquired.  The book value of the non-exempt assets of B is in the billions, and any reasonable estimate of the fair market value would be far greater than $807.5 million.

 

The attached article from 2002 written by Malcolm Pfunder indicates that an acquiring person may concede that a transaction is valued at more than the $500 millon threshold, as adjusted, and pay the highest filing fee.

 

Is that still the PNO’s position?  Can A stipulate that the value of the transaction is greater than $807.5 million and pay the $280,000 filing fee?  If it stipulates, is A’s Board relieved of the obligation to make a good faith estimate of the assets of B?  If a stipulation is not allowed, can A’s Board estimate that the value of B’s assets are a range, i.e. “greater than $807.5 million?” 

 



Thank you in advance for your assistance.

 

[Redacted]

 

 

 

 

 

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