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Preface | |
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Getting Started in Mergers and Acquisitions | |
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Introduction | |
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Basic Terms | |
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Concluding Comments | |
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Notes | |
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Planning and Finding | |
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Introduction | |
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Strategic Planning for Operating Companies | |
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In-House Search | |
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Brokers and Finders | |
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Role of Investment and Commercial Banks in M&A | |
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General Regulatory Considerations for Buyers | |
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Antitrust Considerations for Acquisitions | |
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Hart-Scott-Rodino | |
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Concluding Comments | |
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Sample Checklist of Assets for Use in Complement/Supplement Analysis | |
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Sample Checklist of Risks for Use in Seeking Complementary Acquisitions | |
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Premerger Notification and Waiting Period Under Hart-Scott-Rodino | |
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Types of Organizational Structure | |
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Checklist of Assets | |
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Revision to the Horizontal Merger Guidelines Issued by the U.S. Department of Justice and the Federal Trade Commission | |
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Notes | |
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Valuation and Pricing | |
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Introduction | |
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Valuation Fundamentals | |
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Pricing Issues | |
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Special Considerations for Private Companies | |
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Expressing the Purchase Price in the Acquisition Agreement | |
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Concluding Comments | |
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Estimating the Cost of Capital | |
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Notes | |
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The Art of Financing and Refinancing | |
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Introduction | |
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Financing Overview | |
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Financing Instruments: Equity vs. Debt vs. Hybrids | |
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Financing Sources | |
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Highly Leveraged Transactions | |
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Minimizing Borrowing | |
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Determining Structure in Debt Financing | |
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Senior Debt | |
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Sale-Leasebacks | |
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Pros and Cons of Preserving Debt and Lease Obligations | |
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Seller Takeback Financing | |
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Warrants | |
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Working Capital Debt of the Seller | |
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The Bank Book and Commitment Letter | |
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Other Principal Issues in Senior Loan Agreements | |
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Insurance Company Financing | |
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High-Yield-(a.k.a. "Junk")-Bonds | |
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Bridge Loans | |
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Equity Investment Funds | |
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Registration Rights | |
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Intercreditor Issues | |
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Subordination Issues | |
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Intercreditor Agreements | |
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Fraudulent Conveyance and Other Litigation Concerns | |
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Refinancing Issues | |
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Concluding Comments | |
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Typical Subordination Provisions of Publicly Issued Notes | |
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Typical Subordination Provisions of Privately Placed Institutional Notes | |
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Typical Subordination Provisions of Seller Notes | |
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Notes | |
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Structuring Transactions: General, Tax, and Accounting Considerations | |
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Introduction | |
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General Considerations | |
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Accounting Considerations | |
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Goodwill Impairment Testing | |
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Tax Considerations | |
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Concluding Comments | |
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Transaction Diagrams | |
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Notes | |
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The Due Diligence Inquiry | |
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Introduction | |
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Getting Started | |
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Duration of Due Diligence | |
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Due Diligence Levels | |
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Relations with Seller | |
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Location of Due Diligence Research | |
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Evaluating Assets | |
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Litigation Analysis | |
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Emerging Legal Issues | |
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Due Diligence After Closing | |
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Concluding Comments | |
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Sample Confidentiality Agreement | |
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Due Diligence Checklist | |
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An Annotated Initial Document and Information Request List | |
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Index of Data Room Documents | |
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Notes | |
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Negotiating the Acquisition Agreement and the Letter of Intent | |
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Introduction | |
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The Letter of Intent | |
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The Acquisition Agreement | |
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Components of the Agreement | |
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Introductory Material | |
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Representations and Warranties | |
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Covenants | |
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Conditions to Closing | |
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Indemnity Section | |
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Acquisitions from an Affiliated Group | |
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Transactions Involving Public Companies | |
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Negotiating and Documenting an MBO | |
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Employment Agreements | |
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Stockholders' Agreements | |
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Concluding Comments | |
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Sample Letter of Intent | |
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Typical Merger Agreement and Commentary | |
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Notes | |
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Closing | |
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Introduction | |
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The Basics of Closing | |
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Pre-Closing | |
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Closing | |
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Wire Transfers | |
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Post-Closing | |
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Planning the Closing | |
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Concluding Comments | |
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Sample Closing Memorandum (Including a Detailed Schedule of Closing Documents) | |
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Note | |
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Postmerger Integration and Divestitures | |
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Introduction | |
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Basic Concepts of Integration | |
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The Postmerger Plan | |
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Communicating the Integration Plan | |
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Combining Company Names | |
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Integrating Cultures | |
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Integrating Vision, Policy, Ethics, and Mission Statements | |
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Integrating Key Resources, Processes, and Responsibilities | |
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Integrating Resources | |
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Integrating Processes | |
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Integration of Key Responsibilities | |
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Legal Aspects of Shareholder Relations | |
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Commitments to Employees | |
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Postmerger Compensation: A Complex Issue | |
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Planning Pay Integration: A Strategic Overview | |
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Merging Benefit Plans | |
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Divestitures | |
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Concluding Comments | |
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Sample Postmerger Press Release Highlighting Strategic Motivation | |
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Sample Assets Checklist of Resources, Processes, and Responsibilities | |
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Integration Planning Worksheet | |
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Integration Timeline from a Midsized Acquirer | |
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Pairwise Comparison | |
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Notes | |
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Special Issues for M&A in Public Companies | |
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Introduction | |
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General Considerations | |
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Sarbanes-Oxley and M&A | |
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Duties of Care, Loyalty, and Good Faith in M&A | |
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Director Responsibilities in Responding to Unsolicited Bids | |
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M&A Forms | |
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Tender Offer Basics | |
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Proxy Solicitations | |
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Merger Disclosure Issues | |
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Insider Trading | |
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Financing the Public Transaction | |
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Takeover Defenses | |
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Related State Laws | |
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Concluding Comments | |
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Notes | |
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Workouts, Bankruptcies, and Liquidations | |
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Introduction | |
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General Considerations | |
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Workouts | |
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Bankruptcy | |
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State Insolvency Proceedings | |
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Investing Opportunities: Structuring the Purchase of a Troubled Company | |
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Structuring a Leveraged Buyout to Minimize Insolvency Risk | |
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Financing Alternatives for Companies with Losses | |
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Accounting/Tax Issues for Companies with Losses | |
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Liquidation | |
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Concluding Comments | |
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Diagrams Showing Various Structures for Reorganizations and Workouts of Insolvent Companies | |
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The "Samex" Case: Illustrating the Vulnerability of the Bankruptcy Process to Fraud, and the Relative Finality of Acquisition Decisions Made in Bankruptcy Court | |
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Notes | |
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Structuring Transactions with International Aspects | |
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Introduction | |
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Nontax Issues Regarding Foreign Investment in the United States | |
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Acquisitions of Entities Involving Assets Located Outside the United States | |
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Foreign Exchange | |
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Financing | |
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International Tax and Disclosure Considerations | |
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Tax Considerations in Inbound Acquisitions | |
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FIRPTA | |
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Tax Considerations in Outbound Acquisitions | |
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Concluding Comments | |
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Notes | |
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A WOFC Case Study: J. T. Smith Consultants | |
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Landmark and Recent M&A Legal Cases | |
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Cases Alleging Impropriety in a Merger or in the Acquisition of a Business or Controlling Shares | |
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Cases Alleging Impropriety in the Valuation and/or Sale of a Business, Assets, or Controlling Shares | |
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Cases Involving M&A Agreements or Other Contracts | |
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Cases Alleging Violation of Antitrust Laws | |
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Cases Alleging Violations of Health, Safely, and Labor Laws | |
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Cases Dealing with Jurisdiction or Right to Sue Following a Merger | |
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Additional Recent Cases | |
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Index | |