Hole transfer in assemblies

Hi all,

I could swear this worked 1000 times in the past and now I just can't seem to get it to work. I am trying to transfer holes from one component to another in an assembly.

This is what I have done:

1. Created and saved the assembly

2. Selected the component I want to modify and clicked on "Edit Component"

3. Selected a flat surface on the component I'm editing and selected "Sketch"

4. Selected "Convert Entities"

Here's where the trouble starts. No matter what I try, it's not letting me select the edges of the holes I want to transfer.  

I believe there's a setting under "Tools - Options" but I can't seem to find it.

Any help would be greatly appreciated.

Thanks,
Crin