The term transaction means:

1. (a) A proposed or completed merger, acquisition, or takeover, including without limitation:

   1. (1) The acquisition of an ownership interest in an entity;
   2. (2) The acquisition or conversion of convertible voting instruments of an entity;
   3. (3) The acquisition of proxies from holders of a voting interest in an entity;
   4. (4) A merger or consolidation;
   5. (5) The formation of a joint venture; and
   6. (6) A long-term lease under which a lessee makes substantially all business decisions concerning the operation of a leased entity, as if it were the owner;
2. (b) Any change in rights that a person has with respect to an entity in which that person has an investment; and

3. (c) Any other transaction, transfer, agreement, or arrangement, the structure of which is designed or intended to evade or circumvent the application of section 721.

   Example.Corporation A, a foreign person, signs a concession agreement to operate the toll road business of Corporation B, a U.S. business, for 99 years. Corporation B, however, is required under the agreement to perform safety and security functions with respect to the business and to monitor compliance by Corporation A with the operating requirements of the agreement on an ongoing basis. Corporation B may terminate the agreement or impose other penalties for breach of these operating requirements. Assuming no other relevant facts, this is not a transaction.

Note to § 800.224: See § 800.304 regarding factors the Committee will consider in determining whether to include the rights to be acquired by a foreign person upon the conversion of convertible voting instruments as part of the Committee's assessment of whether a transaction that involves such instruments is a covered transaction.

[83 FR 51320, Oct. 11, 2018]