Introduction In mergers and acquisitions agreements, the seller generally represents and warrants that the target’s financial statements for its most recent fiscal year and its most recent interim financial statements are accurate and complete, consistent with operations, and prepared in…
Blog Archives
Monthly Financial Statements Not Covered by Financial Representation Covered by Books & Records Representation
Posted in books and records rep and warranty, financial representation and warranty Tagged with: M&A stories, M&A tips, monthly financial statements
Court Rules That EY Earnout Calculation Was Arbitration Not Expert Determination
Introduction There are often post-closing calculations that must be made in an M&A deal. Examples are working capital and earnout calculations. Often the parties agree in advance to a dispute resolution procedure in the M&A documents in the event there…
ESOP Bank Trustee & Owner Must Pay $6.5 Million Purchase Price Overpayment to ESOP
Introduction One exit strategy for a business owner is to sell your company to an ESOP; especially if there are no serious buyers. However, those transactions are highly regulated by the federal government and must be done right. The deal…
Posted in capitalization of cash flow, discounted cash flow or DCF, independent trustee, projections, prudence, sale of business to ESOP, valuation Tagged with: M&A stories, M&A tips, overpayment
Business Buyer Loses Claim for $8 Million of Nonrenewed Customer Contracts
Introduction A crucial part of a potential business buyer’s due diligence is evaluating the seller’s projections. However, those projections often do not materialize, and disappointing projections do not usually amount to a breach of the seller’s acquisition agreement representations and…
Posted in customer and supplier rep, full disclosure rep, MAE rep, projections, representations and warranties Tagged with: M&A stories, M&A tips
Buyer Loses Dispute with Asset Seller Over Responsibility for Deal’s Sales Tax
Introduction The language used in an M&A deal matters. In a post-closing dispute, the lawyers and judges look to the language of the M&A document to resolve the dispute. And sometimes, the language will work against what a party thought.…
Posted in allocation of sales tax from transaction, asset purchase agreement Tagged with: M&A stories, M&A tips, sales tax imposed on buyer
Court Greenlights Business Seller’s Fraud Lawsuit Over Earnout Dispute
Introduction Disappointing earnout deals are common. The deal This deal involved the stock acquisition of the target, a legal analytics company by a competitor. The price was $9 million cash plus a $3 million earnout potential. The earnout was based…
Court Holds That $12 Million Merger Termination Fee Payment Not Exclusive Remedy
Introduction It is common in M&A deals for the seller to have the right to terminate an agreement by paying a significant termination fee; especially as part of a fiduciary out structure. The deal This case involves players in the…
Insolvent Nonprofit Hospital’s 363(f) Sale Was Free of a $305 Million Cost Imposed by CA AG
Introduction The sale of the assets of a nonprofit hospital in California requires the permission of the state’s attorney general. The deal This deal involves the Bankruptcy Code Section 363(f) sale of four California nonprofit hospitals in bankruptcy for $610…
Buyer to Indemnify Business Seller for 3rd Party Asbestos Claim Punitive Damages
Introduction Liability for asbestos claims is a common risk with manufacturing companies. Sophisticated buyers and sellers of manufacturing businesses are aware of the risk and usually manage it through an allocation between the buyer and the seller in the acquisition…
Posted in asbestos claims, indemnification, punitive damages Tagged with: indemnification for punitive damages, M&A stories, M&A tips
Business Buyer’s Suit Against Seller is Hampered by Missing Due Diligence Binder
Introduction Buying a company has many legal risks for a buyer. One of the most important tools to manage the risks of buying a business is to conduct a thorough due diligence investigation of the company. The deal This case…
Posted in preservation of due diligence materials Tagged with: due diligence materials, M&A stories, M&A tips, preservation of due diligence materials
Recent Posts
- Monthly Financial Statements Not Covered by Financial Representation Covered by Books & Records Representation
- Court Rules That EY Earnout Calculation Was Arbitration Not Expert Determination
- ESOP Bank Trustee & Owner Must Pay $6.5 Million Purchase Price Overpayment to ESOP
- Business Buyer Loses Claim for $8 Million of Nonrenewed Customer Contracts
- Buyer Loses Dispute with Asset Seller Over Responsibility for Deal’s Sales Tax
Archives
Categories
- "as is where is"
- actual knowledge
- actual notice to known creditors
- agreement to agree is unenforceable
- all cash deal
- allocation of preclosing taxes refunds and credits
- allocation of sales tax from transaction
- alter ego
- alternative dispute resolution
- ambiguous exclusion
- anti-destruction clause
- anti-reliance clause
- approval of franchisor
- approval of investment banking fee
- arbitration vs expert determination
- asbestos claims
- asset buyer's assumption of seller's liabilities by contract
- asset purchase agreement
- asset seller's liabilities
- asset vs stock deal
- Assignment
- assignment of contracts
- assumed liabilities
- assumption of a contract
- assumption of contract by incorporation by reference
- bad faith
- bankruptcy sale
- bitcoin
- blockchain
- boilerplate provisions
- book value adjustment
- books and records rep and warranty
- bootstrapping doctrine
- breach of contract
- breach of representations and warranties
- breach of seller's covenants
- business cards
- business judgment rule
- buyer assumption of seller's contracts
- Buyer beware
- buyer's assumption of seller liabilities in asset acquisition
- buyer's stock as currency
- buying distribution business
- California
- capitalization of cash flow
- cash and cash equivalents
- CERCLA or superfund liability
- certificate of insurance
- choice of law provision
- choice of law provision
- closing
- commercially reasonable efforts
- compliance with all applicable laws
- conditions to closing for buyer's benefit
- consent to assignment
- consent to assignment
- constructive knowledge
- constructive knowledge
- continuity of enterprise exception
- contracts
- contravene strong state public policy
- controlling shareholder fiduciary duty M&A
- corporate overhead
- covenant not to compete
- Covenants
- customer and supplier rep
- customer list
- damages
- de facto merger exception
- deferred closing
- Delaware
- dental practice sale
- Description of business assets purchased
- diminuation of value
- directors and officers insurance policy
- discharge in bankruptcy
- disclosure schedule
- discounted cash flow or DCF
- dispute resolution procedure
- dispute resolution provision
- distressed business acquisitions
- divestitures
- doing deal with company's officer or director
- due diligence
- Duty to negotiate in good faith
- duty to warn
- earn out
- earn out dispute procedure
- earn outs
- earnout as ownership interest in buyer
- EBITDA
- economic loss doctrine
- employment agreement
- employment agreement
- enforce against nonparty
- entire fairness
- environment representations and warranties
- environmental
- environmental remediation
- equitable contribution
- escrow
- excluded liabilities
- excluded or retained liabilites
- exclusive remedy
- exclusivity provision
- executory contracts
- extension by contract in Delaware
- extension of closing
- extra-contractual fraud
- fair insider deal
- Family and Medical Leave Act
- FDIC approval
- federal employer liability
- federal employment discrimination liability
- federal multiemployer pension plan withdrawal liability
- federal securities fraud
- federal wage and hour violations
- fee based upon buyer debt assumption
- financial representation and warranty
- financing acquisition issues
- financing contingency
- for cause termination
- force majeure
- forum non conveniens doctrine
- forum selection clause
- franchise sale
- fraud
- fraud carveout
- fraud in business sale
- fraud in the inducement exception
- fraudulent concealment
- fraudulent inducement
- fraudulent intent
- fraudulent omission
- full disclosure rep
- full disclosure rep
- further assurance provision
- governmental approval of transaction
- hinder, delay or defraud
- hiring seller's employees
- implied covenant of good faith and fair dealing
- implied warranty of merchantability
- indemnification
- indemnification cap
- independent trustee
- inequitable
- insider
- insurance broker duty
- insurance coverage
- insurance requirements
- integration clause
- Intellectual Property
- Internal Revenue Code Section 1377 election
- investment banker/business broker
- joint venture
- key employees of target
- land use issues
- layoff notice law or Warn Act
- leases
- leases
- letter of intent
- liens
- liquidated damages provision
- loss payee
- lost profits
- M&A agreement
- MAE rep
- major shareholders exclusion
- material
- material contracts
- material rep and warranty breach
- Medi-Cal provider agreements
- membership interest purchase agreement
- mere continuation
- mere continuation exception
- merger
- merger agreement
- midco transaction
- minority business participation program
- misleading personal financial statement
- missing attachment to acquisition document
- multi-employer pension plan
- mutual mistake
- negligent misrepresentation
- net working capital adjustment
- no kickback or bribe rep
- no oral modifications of contract
- no pending government investigations or inquiries
- No Undisclosed Liabilities
- non-reliance clause
- nonbinding
- noncompete area
- noncompetition covenant term
- nondisclosure agreement
- nondisclosure provision
- nonsolicitation of employees and customers
- note payment amount adjustment
- notice
- notice provision
- officer or director's fiduciary duty to disclose
- offset or setoff provision
- offset right
- overly complicated language in contract
- owner liability for company breach of financing deal
- percentage of purchase price
- personal goodwill
- personal guaranty
- personal guaranty of company debt by selling shareholder
- personal guaranty of lease
- Personal Name
- piercing veil of acquisition subsidiary
- post asset purchase issues
- post closing covenants
- post signing asset valuation
- preservation of due diligence materials
- prior-material-breach doctrine
- private equity
- product line exception
- projections
- projections
- promissory note
- prudence
- public information exclusion
- punitive damages
- purchase agreement
- purchase price
- purchase price adjustment
- purchase price reduction
- quality of earnings assessment
- ratifying unassumed contract by post-closing action
- reasonably equivalent value
- receipt of buyer equity or security
- receipt of buyer equity or security
- reformation
- reformation of contract
- reliance
- representation and warranty about customers
- representations and warranties
- rescission
- rescission
- retaliation
- retention bonus
- revenue and profit projections
- reverse termination or breakup fee
- Right of publicity
- royalty
- sale leaseback
- sale of assets of business
- sale of business to ESOP
- sale of product line
- Section 363 sale
- securing buyer's note
- securing deferred purchase price
- security agreement
- seller owners equity interest in buyer
- seller ownership in buyer
- seller rep of no federal employer liability
- seller's age discrimination claims
- seller's covenants
- seller's federal injunctions
- seller's unemployment experience rating
- seller's warranty claims
- seller's workers compensation experience rating
- severance benefits
- sexual harassment
- shareholder buyout of partner
- shareholder release
- sharing transaction tax deduction benefits
- specific performance
- state approval of nonprofit hospital
- statute of limitations
- stay bonus
- step-down provision
- stock purchase agreement
- strategic acquisition
- strategic acquisition
- subordination
- success fee
- successor liability
- survival of covenants
- survival of reps and warranties
- target's stock options
- tax benefit sharing
- Taxation
- termination of M&A agreement
- termination or breakup fee
- third party beneficiary clause
- timely objection to indemnification claim
- tolling
- tort misrepresentation in M&A
- tortious interference with prospective economic advantage
- trade secret misappropriation
- trade secret misappropriation by former seller employee
- trademark infringement
- transferee liability for taxes IRC Section 6901
- transitory services contracts
- tying fraud to economic loss
- UCC search
- Uncategorized
- Uniform Fraudulent Transfer Act or Uniform Voidable Transfer Act
- union fringe benefits
- union liabilities
- unjust enrichment
- valuation
- value added tax or VAT
- waiver of contractual provision
- waiver provision
- willful breach carveout
- Withholding Post-closing payments
- working capital adjustment
Recent Comments