M&A, Corporate and Securities Law Glossary

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Today, I published a fairly comprehensive glossary of terms used by M&A, corporate and securities lawyers. Coverage ranges from the “All Holders, Best Price Rule” and “Bear Hug Letters” to “Unocal Standard” and “XBRL.” It includes 550 terms in all. The Glossary is accessible through the main menu of The M&A Lawyer Blog (in the banner at the top…

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I’m buying a company. How do I know exactly what I’m getting?

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Unfortunately, an acquisition is like a box of chocolates: you never know what you’re gonna get. Even if it’s an asset purchase, rather than a merger or stock sale, when you’re buying a company, there’s risk that you’ll be assuming unknown liabilities. For example, unbeknownst to you, a seller may be insolvent, and the transfer of assets to you…

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What you need to know about M&A letters of intent

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Preliminary outlines of proposed M&A deals—whether called letters of intent (LOIs), term sheets or memoranda of understanding (MOUs)—allow parties to sketch out fundamental terms quickly before expending substantial resources on negotiating definitive agreements, finalizing due diligence, pursuing third-party approvals and other matters. M&A letters of intent appear simple (they aren’t) and as something that can be advanced without lawyers (they shouldn’t…

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Documents you need to buy or sell a business

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The documents you need to buy or sell a business depend on the structure (discussed here) and complexity of the deal as well as its specific terms. However, in virtually all cases, there will be a principal agreement governing the transaction. This will be a merger agreement for a merger, a stock purchase agreement for…

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What you need to know about M&A confidentiality agreements

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Most M&A transactions are material to the parties involved, and public disclosure that a deal is in the offing can have profound effects on a company’s operations, ranging from employee attrition to loss of confidence by commercial counterparties. Of course, for public companies, exploration of strategic alternatives may constitute material nonpublic information implicating Regulation FD (which…

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Will you elaborate on the use of earnouts in M&A deals?

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This is a follow-up to an earlier post on earnouts in M&A deals. I’ve embedded below a detailed presentation on earnouts I prepared last year. It is intended to serve as a stand-alone document that does not require any verbal commentary. Topics include: An introduction to earnouts Determining whether to use an earnout How to measure…

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Introduction to M&A Earnouts

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M&A earnouts can help you get deals done . . . but not without risk. An earnout is a deal financing mechanism where the buyer agrees to make future payments to the seller if certain agreed-upon financial or operating targets are reached after closing. The future payments are usually in addition to amounts paid at closing and…

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What are the main features of public company M&A?

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A few years ago, I gave a training webinar on public company M&A with my close friend Roger W. Bivans, a Partner with Baker & McKenzie in Dallas. This offers a fairly comprehensive treatment of the subject. However, it hasn’t been updated to reflect any changes in the law since its original publication date so be careful…

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M&A Fiduciary Duties: Maximizing Shareholder Value

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You owe minority investors or other shareholders special fiduciary duties when you sell your company. As I discussed in a prior post, directors, officers and others who control companies (let’s call them “control persons”), owe certain baseline fiduciary duties to shareholders.  Under Delaware law, the benchmark for corporate governance in the United States, these duties apply…

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