Marc, It should include minority investors (but not de minimus), just as the Registry Agreement would. I believe the cut of is 15% ownership . We should be consistent in my opinion. Of course if they are also officers, then that would be disclosed separately. Sincerely, Jeffrey J. Neuman Founder & CEO JJN Solutions, LLC +1.202.549.5079 Jeff@jjnsolutions.com ________________________________ From: trachtenbergm--- via SubPro-IRT <subpro-irt@icann.org> Sent: Thursday, May 15, 2025 2:12 PM To: phil@dotadvice.co.uk <phil@dotadvice.co.uk>; lars.hoffmann@icann.org <lars.hoffmann@icann.org>; subpro-irt@icann.org <subpro-irt@icann.org> Subject: [SubPro-IRT] Re: Change of Control / Terms of Conditions Lars, This language seems to include disclosure of even minority investors. Is that what is intended? Also, the language says: “any entities or persons providing Financing (if any), that exercise or have the ability to exercise (or will exercise or will have the ability to exercise) direct or indirect decision-making or management over the operations or policies…of the Applicant or any of its affiliates relating to this Application, whether by ownership interest, contractual rights or otherwise.” What are examples of “affiliate relating to this application”? This seems ambiguous and potentially extremely broad. Marc H. Trachtenberg Shareholder Chair, Internet, Domain Name, e-Commerce and Social Media Practice Greenberg Traurig, LLP 77 West Wacker Drive | Suite 3100 | Chicago, IL 60601 T +1 312.456.1020 M +1 773.677.3305 trac@gtlaw.com<mailto:trachtenbergm@gtlaw.com> | www.gtlaw.com<http://www.gtlaw.com/> | View GT Biography<https://www.gtlaw.com/en/professionals/t/trachtenberg-marc-h> [Greenberg Traurig Logo] [cid:image002.png@01DBC58A.3BA79A00] From: Phil Buckingham via SubPro-IRT <subpro-irt@icann.org> Sent: Thursday, May 15, 2025 10:43 AM To: 'Lars Hoffmann' <lars.hoffmann@icann.org>; 'Next Round Policy Implementation via SubPro-IRT' <subpro-irt@icann.org> Cc: subpro-irt@icann.org Subject: [SubPro-IRT] Re: Change of Control / Terms of Conditions *EXTERNAL TO GT* Hi Lars, Thanks for your email. In preparation for our call later today. The latest version I have for Applications Questions was send by Jared on 8 May . I have Q109 Ultimate Control ( not Q104 ) ? I read Q109 as Ultimate Control as at the date of application. My suggestion is additional instruction or Q109B that should be even more “ tight and stricter “. Read as 2. “ In the event of a subsequent change of control , disclose ALL entities or persons including ALL entities or persons providing ADDITIONAL FINANCING ( specifically for contention set auctions ) , such that it/they can exercise or have the ability to exercise ( or will exercise or will have the ability to exercise ) direct or indirect decision – making or management over the operations or policies (i) concerning the Application or (ii) of the Applicant or any of its affiliates relating to this Application whether by ownership interest , contractual rights or otherwise “ A note should add. A minimum 20% shareholding would be deemed as a change of control. ( To X reference to Q224 Funding Plan ). Thanks, Phil Phil Buckingham Founder TLD.Advice Ltd Registrar for Companies for England and Wales. Company Number 16341257. From: Lars Hoffmann via SubPro-IRT <subpro-irt@icann.org<mailto:subpro-irt@icann.org>> Sent: 15 May 2025 15:55 To: Next Round Policy Implementation via SubPro-IRT <subpro-irt@icann.org<mailto:subpro-irt@icann.org>> Subject: [SubPro-IRT] Terms and Conditions Dear IRT members, For today’s call, we do not have a redline but we had more internal discussions and I wanted to provide this – lengthy – note before the call, giving you the opportunity to digest and hopefully inform a constructive discussion. First, thank you again for the discussion last week and the messages on the mailing list. As we work through the language in the Terms & Conditions to address the questions raised about assignments and changes of control in light of the Board’s direction to ICANN org in the 30 April 2023 resolution addressing the .WEB IRP (https://www.icann.org/en/board-activities-and-meetings/materials/approved-resolutions-regular-meeting-of-the-icann-board-30-04-2023-en#section2.e<https://urldefense.com/v3/__https:/www.icann.org/en/board-activities-and-meetings/materials/approved-resolutions-regular-meeting-of-the-icann-board-30-04-2023-en*section2.e__;Iw!!DUT_TFPxUQ!AsPc-NJsx04OzIP7z4mawDEUkIH888YE8Mn4kbweeo4UmY7SzxoLlCluvodujChe_ikUSd_4lht87GuIO_nOeMs$>). We thought it would be helpful first to lay out the specific directions given in the noted resolution by the Board to ICANN org to consider when developing the Applicant Guidebook for the Next Round, and second, to identify how these directions have been or are being addressed in the implementation of the Program. Board Directions to ICANN Org from 30 April 2023 Resolution on .WEB IRP Below are some relevant sections of the resolution and rationale where the Board directed ICANN org to undertake specific actions for the Next Round in light of the .WEB IRP: Excepts from Board Resolution 2023.04.30.12<https://urldefense.com/v3/__http:/023.04.30.12__;!!DUT_TFPxUQ!AsPc-NJsx04OzI...> – 2023.04.30.14<https://urldefense.com/v3/__http:/023.04.30.14__;!!DUT_TFPxUQ!AsPc-NJsx04OzI...>: * Resolved (2023.04.30.13<https://urldefense.com/v3/__http:/023.04.30.13__;!!DUT_TFPxUQ!AsPc-NJsx04OzI...>), the Board hereby notes the questions raised regarding certain conduct by both NDC and Altanovo and directs the Interim President and CEO, or her designee(s), to carefully consider the issues raised by the parties and the Panel in the .WEB IRP with regard to agreements similar to the DAA and communications prior to an ICANN auction when developing the Guidebook and auction rules for the next round of the New gTLD Program in order to provide greater clarity to applicants regarding the transparency and notification requirements throughout the application and auction processes. Excepts from Rationale to Board Resolution 2023.04.30.12<https://urldefense.com/v3/__http:/023.04.30.12__;!!DUT_TFPxUQ!AsPc-NJsx04OzI...> – 2023.04.30.14<https://urldefense.com/v3/__http:/023.04.30.14__;!!DUT_TFPxUQ!AsPc-NJsx04OzI...>: * The Board, however, does note the claims asserted regarding NDC's non-disclosure of its arrangement with Verisign and regarding Altanovo's communications prior to the ICANN auction and, thus, has directed ICANN organization to carefully consider such issues when developing the Guidebook and the auction rules for the next round of the New gTLD Program. It would be beneficial to both the applicants and the application process as a whole to provide greater clarity in the next iteration of the Guidebook and auction rules regarding the transparency and notification requirements throughout the application and auction processes, in particular with regard to proposed registry agreement assignments and/or arrangements similar to the DAA as well as communications during the Blackout Period. * More specifically, the BAMC and the Board found that the DAA does not violate Paragraph 10 of the Guidebook, including the last sentence, which states that "Applicant may not resell, assign, or transfer any of applicant's rights or obligations in connection with the Application." NDC remains the applicant of its .WEB application because NDC did not sell or transfer the application. While NDC has agreed that the DAA grants Verisign various rights with respect to how NDC proceeds, including with respect to [Redacted-Confidential Information], NDC did not resell, assign, or transfer its rights or obligations with regard to the .WEB application itself, and retained the right to communicate with ICANN and to provide information "[Redacted-Confidential Information]." In the event NDC negotiates with and enters into a Registry Agreement with ICANN for .WEB, NDC would become the Registry Operator for .WEB. Only after NDC secures a Registry Agreement (if it does) can NDC then submit a request to ICANN to have the agreement assigned to Verisign. * Finally, the Board acknowledges and agrees with the BAMC's recommendation regarding the importance of greater clarity regarding the transparency and notification requirements in the application and auction processes. The Board recognizes that numerous new gTLD Registry Agreements have been assigned and the Applicant Guidebook applicable to the 2012 round of the New gTLD Program does not address the myriad of circumstances under which such assignments might occur, and when such agreements may be entered into. In this respect, the Board has determined that it is prudent to take that into consideration when developing the guidelines, rules and procedures for the next round of the New gTLD Program. Thus, the Board is directing ICANN org to carefully consider the issues raised by the parties and the Panel in the .WEB IRP with regard to agreements similar to the DAA and communications prior to an ICANN auction when developing the Guidebook and auction rules for the next round of the New gTLD Program in order to provide greater clarity to applicants regarding the transparency and notification requirements throughout the application and auction processes. ICANN Org Implementation Approach to Address Board’s 30 April 2023 Resolution on .WEB IRP As directed by the Board, to provide greater clarity to applicants regarding the transparency and notification requirements throughout the application and auction processes, ICANN org looked at the Next Round Program holistically and proposed the following approach: 1. Updated Program Terms & Conditions a. Section 1: We updated the language on changes to an application that must be reported to ICANN to provide additional clarity, including timeframes. We continue to review this section to also see whether it is possible to map changes required to be reported to ICANN to specific application questions. b. Section 9: As we discussed on prior calls, we updated the assignment language in the Terms & Conditions to make clear that an applicant cannot assign its application as a whole. We understand the questions/concerns about distinguishing between assignments and changes of control, and note that we’ve proposed to address changes of control as further explained below in #2. There was some discussion on the email list and during the previous call about the 2012 AGB including a right for applicants to assign an application with ICANN’s express written consent, but this was not a feature of the Program in 2012. The 2012 Terms & Conditions also had an anti-assignment clause, and the AGB made it clear that if applicants attempted to resolve contention privately, it should be done in a way that does not materially affect the remaining application. (See 2012 AGB Section 4.1.3) 2. Updated Application Questions to require additional disclosures of persons/entities having some level of control over the applicant or an application. As part of the discussion with the IRT, there were questions raised about a scenario where a person or entity may be in “control” of an applicant and the applicant would never have to disclose this fact, and this could deprive ICANN/the public/other applicants information that might be relevant for filing an objection, the GAC giving the Board advice, and ICANN conducting background screening, for example. We think these concerns have been addressed through the changes we made to the application questions, specifically the new question/disclosure that would be required by Application Question 104. The question provides additional information and transparency. The current version of the question reads, “Disclose any entities or persons, including any entities or persons providing Financing (if any), that exercise or have the ability to exercise (or will exercise or will have the ability to exercise) direct or indirect control over the operations, management, or policies of Applicant or any of its affiliates, whether by ownership interest, contractual rights or otherwise.” In light of the discussions about changes of control, we are proposing a further update to Question 104 so that it would say, “Disclose any entities or persons, including any entities or persons providing Financing (if any), that exercise or have the ability to exercise (or will exercise or will have the ability to exercise) direct or indirect decision-making or management over the operations or policies (i) concerning the Application, or (ii) of the Applicant or any of its affiliates relating to this Application, whether by ownership interest, contractual rights or otherwise.” Note: if answer to application question change (after submission), applicants are required to submit an ACR. 3. Updates to Auction Process In the noted Board direction, there’s direction to also look at the auction process for additional transparency opportunities. The current draft of the AGB notes that the auction rules will be finalized once we’ve gone through the process of securing a vendor. While we don’t have the specific rules/changes yet, it is very much on our project plan that we will need to look at this issue when it comes time to work with the relevant vendor on developing the auction rules and any related procedures or agreements. Overall, we believe the above approach addresses the directions given to ICANN org to address Board Resolution 2023.04.30.12<https://urldefense.com/v3/__http:/023.04.30.12__;!!DUT_TFPxUQ!AsPc-NJsx04OzI...> – 2023.04.30.14<https://urldefense.com/v3/__http:/023.04.30.14__;!!DUT_TFPxUQ!AsPc-NJsx04OzI...>. For today, I will review this note on the call and invite initial feedback. Our suggestion is that we move this to public comment where community members, including the IRT can provide further comments. Many thanks and best wishes, Lars
