| MERCADO LIBRE, INC TRONADOR 4890, 8TH FLOOR BUENOS AIRES, C1430DNN ARGENTINA | ||||
| TEL | 011• 5411• 5352• 8000 | |||
| FAX | 011• 5411• 4545• 4744 / | |||
| 011• 5411• 5550• 8719 | ||||
| HERNAN KAZAH. DIRECT DIAL: 011-5411-5352-8004 EMAIL: hernan@mercadolibre.com | ||||
| Re: | MercadoLibre, Inc. | |
| SEC Comment Letter for the Form 10-K for the Fiscal | ||
| Year Ended December 31, 2008 filed on February 27, 2009 | ||
| Forms 8-K filed on February 24, 2009 and May 6, 2009 | ||
| File No. 001-33647 |
| 1. | We note that your counsel, on behalf of the Company, provided the acknowledgments we requested in our letter dated May 28, 2009. Please note that the representations should come directly from the company. In your next response, please provide the representation directly from the company. |
| 2. | Your response to prior comment 7 indicates that you have not provided the required disclosures because you would have pursued an alternative tax planning strategy had the tax holiday not been in place. Although we understand that you may be able to implement these strategies, the disclosures in SAB Topic 11.C are required disclosures. Please confirm that in future filings you will provide the disclosures required by SAB Topic 11.C. |
| 3. | We note from your response to prior comment 10 that you do not believe paragraphs A240(b)(2), (c)(2), and (d) of SFAS 123(R) are applicable because the Company did not grant options. However, since the shares issued in connection with your long-term retention plan were not vested at their grant date, it appears that such paragraphs are applicable. In this regard, paragraphs A240(b), (c)(2), and (d) make reference to share units and paragraph A240(b)(2) makes reference to shares of nonvested stock. Therefore, tell us how you considered disclosing the information in these paragraphs or explain to us further why you do not believe they are applicable. |
| Disclosure Requirement | Company Response | |
Paragraph A240 (b) (2): The number and weighted-average grant-date fair value (or calculated value for a nonpublic entity that uses that method or intrinsic value for awards measured pursuant to paragraphs 24 and 25 of this Statement) of equity instruments not specified in paragraph A240(b)(1) (for example, shares of non-vested stock), for each of the following groups of equity instruments: (a) those non-vested at the beginning of the year, (b) those non-vested at the end of the year, and those (c) granted, (d) vested, or (e) forfeited during the year. | As disclosed in note 17 to our Financial Statements included in our Form 10-K for the Fiscal Year Ended December 31, 2008, the company has granted 21,591 shares under the long-term retention plan as of December 31, 2008. The grant-date fair market value was $36.8 for each share. All equity instruments were granted during 2008 and were non-vested at the end of the year. There were no vested or forfeited equity instruments related to the Long term retention plan during the year ended December 31, 2008. We considered all granted shares as non-vested because, as described in note 17, it is required that the employee stays in the Company at the payment date. In future filings we will include the above mentioned information to meet the disclosure requirements of paragraph A240 (b) (2). | |
Paragraph A240 (c) (2): The total intrinsic value of options exercised (or share units converted), share-based liabilities paid, and the total fair value of shares vested during the year. | According to FAS 123(R), paragraph E1, the intrinsic value of a non-vested share may be described as an option on that share with an exercise price of zero. Thus, the fair value of a share is the same as the intrinsic value of that share. In note 13 to our Financial Statements included in our Form 10-K for the Fiscal Year Ended December 31, 2008, we included the fair value of our shares. In future filings, we will disclose the fair value of our shares in our Long Term Retention Plan note to our Financial Statements. (See the aggregate intrinsic value table included at the end of this letter for more detail) |
| Disclosure Requirement | Company Response | |
Paragraph A240 (d): For fully vested share options (or share units) and share options expected to vest at the date of the latest statement of financial position: (1) The number, weighted-average exercise price (or conversion ratio), aggregate intrinsic value (except for nonpublic entities), and weighted average remaining contractual term of options (or share units) outstanding. (2) The number, weighted-average exercise price (or conversion ratio), aggregate intrinsic value (except for nonpublic entities), and weighted average remaining contractual term of options (or share units) currently exercisable (or convertible). | As of December 31, 2008, the Company did not have any fully vested share as disclosed in the response to Paragraph A240 (b) (2). As of December 31, 2008, the remaining contractual term of shares granted was 3.25 years (remaining vesting period). The aggregate intrinsic value has been included in the response to the disclosure requirements of paragraph A240 (b) (2) above. In future filings we will include the above mentioned information to meet the disclosure requirements of paragraph A240 (d). |
| March 31, | December 31, | |||||||
| 2009 | 2008 | |||||||
| Number of shares granted | 21,591 | 21,591 | ||||||
| Closing price of share | 18.55 | 16.41 | ||||||
| Weighted average exercise price | — | — | ||||||
| Intrinsic value | 18.55 | 16.41 | ||||||
| Aggregate intrinsic value | 400,513 | 354,308 | ||||||
| cc: | Christine Davis Melissa Feider | |
| Edward W. Elmore Jr. | ||
| Jacobo Cohen Imach Jan Woo | ||
| Katherine Wray |
