Intro to M&A Representations and Warranties

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The primary transaction agreement in every M&A deal contains representations and warranties, colloquially referred to as “reps and warranties” or simply “reps,” from each party to the other. These are statements of past, present and sometimes future fact relating to the status, business, assets, liabilities, properties, condition, operating results, operations and prospects of the party making…

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Anatomy of an Asset Purchase Agreement

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Like the classic game Operation,® asset purchase transactions require parties to take great care in extracting just what they want. However, successful asset sales require quite a bit more than a pair of tweezers and steady hands. Among other things, they require a well-crafted Asset Purchase Agreement (APA). These agreements, at their most basic level, provide for the sale…

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Anatomy of a Stock Purchase Agreement

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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…

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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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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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