Most private M&A transactions are structured as acquisitions of stock, rather than mergers or asset purchases. The principal agreement governing such a transaction is typically a Stock Purchase Agreement (SPA), sometimes styled a Securities Purchase Agreement or simply a Purchase Agreement. At their most basic level, these agreements provide for the sale of shares in a […]
Category Archives: M&A Process
The M&A Lawyer Blog Publishes Forms Database
Mergers & Acquisitions practice relies heavily on the use of forms and precedent. They are the very foundation of what we do. Absent an eidetic memory, even the most accomplished M&A attorneys need precedent consents, agreements, certificates, checklists, filings and other documents to consummate a transaction, and the quality of the forms used directly impacts […]
M&A Disclosure – Annotated Form 8-K
Public companies that participate in M&A transactions are subject to a myriad of potential disclosure obligations throughout the transaction process. These may arise under applicable stock exchange listing rules, federal securities laws, state fiduciary duty and proxy requirements as well as antitrust law and other regulatory regimes. The federal securities laws alone may require various disclosures […]
Material Adverse Effect Clauses
Things rarely go according to plan. Earnings are missed. Commercial relationships end. Regulatory approvals don’t materialize. Lawsuits get filed. And disasters happen. Such are the vicissitudes of business. But what happens when they transpire during the gap period between signing and closing an M&A transaction? Most sellers would argue that little if anything should happen—the deal should still close at the previously […]
How to take control of a Board through written consents
On August 19, 2015, the Delaware Court of Chancery issued an opinion in Kerbawy v. McDonnell that addressed how holders of a majority of a company’s shares should take control of a board of directors by executing written consents. The case involved interpretation of Section 228 of the Delaware General Corporation Law, which provides that, unless otherwise set forth in […]
What does an M&A lawyer do?
An M&A lawyer runs the deal. She is the hub in the hub-and-spoke system of deal parties and their advisers. The M&A lawyer serves as the primary point of contact for the rest of the deal team and has principal responsibility for shepherding the transaction to closing. She may be an in-house attorney but is more often an M&A specialist practicing with an outside […]
FTC Issues Guidance on Antitrust Merger Review
As mentioned in a prior post, if the transaction value for an M&A deal equals or exceeds $92 million (as of the date of this post; the threshold is adjusted annually), an HSR filing may be required with the Premerger Notification Office of the Federal Trade Commission, and the parties must wait 30 days to […]
I’m buying a company. How do I know exactly what I’m getting?
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 […]
What you need to know about M&A letters of intent
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 […]
Documents you need to buy or sell a business
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 […]