Fundamentals Of
Business Acquisition Transactions
Affinia Manhattan
October 27, 2005
371 Seventh Avenue
New York, NY 10001
(212) 563-1800
8:30 a.m. to 4:30 p.m.
Agenda
8:30 a.m. - 8:50 a.m.
I. Overview
- Philip L. Chapman
A. General Remarks
B. Overview Of The Program's Written Materials
8:50 a.m. - 9:35 a.m.
II. The Roles Of A Business Intermediary
- Stephen Goldberg
A. For A Seller, Including Where The Seller Has Already Targeted The Potential Buyer
B. For A Buyer
9:35 a.m. - 10:20 a.m.
III. Valuation And Related Matters
- Stephen Goldberg and Kevin Groff
10:20 a.m. - 10:30 a.m.
Break
10:30 a.m. - 10:45 a.m.
IV. Content Of The Seller's Or Selling
Shareholders Or Members Engagement
Letter With The Business Intermediary
- Philip L. Chapman and Stephen Goldberg
10:45 a.m. - 11:05 a.m.
V. Confidentiality Agreements; Letters Of
Intent, Term Sheets, etc.
- Philip L. Chapman and Stephen Goldberg
A. Confidentiality Agreements Before Letter Of Intent Stage
B. Use Of A Letter Of Intent, Term Sheet Or Memorandum Of Understanding – Pros And Cons
C. Content And Style Of An LOI Or MOU
D. Selected Issues Including 'Stand-Still Provisions'
11:05 a.m.- 11:20 a.m.
VI. Disclosure Of Seller's Confidential
Information
- Philip L. Chapman, Stephen Goldberg
and Kevin Groff
A. Where And How Disclosures Will Be Made – Keeping The Potential Sale Secret From Employees And Others
B. When Will The Information Be Delivered Or Made Available – Use Of Phased Disclosures
C. Edited Disclosure
11:20 a.m. - 11:35 a.m.
VII. The Roles Of The Accountants
- Philip L. Chapman and Stephen Goldberg
A. When The Accountant First Gets Involved And Why
B. Due Diligence By The Buyer's Accountant
C. Due Diligence By The Seller's Accountant Concerning The Buyer
11: 35 a.m. - 12:00 p.m.
VIII. The Lawyer's Roles
- Philip L. Chapman
A. When The Lawyer First Gets Involved And Why
B. Due Diligence By The Buyer's Lawyer
C. Due Diligence By The Seller's Lawyer Concerning The Buyer
D. Very Useful Initial Actions To Be Taken By The Lawyers
12:00 p.m. - 1:00 p.m.
Lunch (On Your Own)
1:00 p.m. - 1:20 p.m.
IX. Practical Tips On How To Get The Deal
Done
- Philip L. Chapman and Stephen Goldberg
A. Early Identification Of The Client's 'Team' And Assisting In The Coordination Of The Efforts Of 'Team' Members, Such As The Business Intermediary, The Accountant, Labor And Employment Law Counsel, Intellectual Property Counsel, Regulatory Counsel, Pension Plan And Benefits Service, Insurance Broker, Environmental Engineering Firm
B. Who Does The Negotiating On What Issues?
C. The Need To Identify The Point When The Parties Should Get In The Same Room To Hammer Out Open Items
1:20 p.m. - 2:50 p.m.
X. Selected Deal Issues
- Philip L. Chapman, Stephen Goldberg
and Kevin Groff
A. Transaction Structure – Financial Elements Of A Business Sale Transaction – Terms/Deal Structure And Terms Of Payment
B. Financing Contingencies
C. Sale Of The Stock Of Subchapter S Corporation-Income Before The Closing And Tax Returns
D. The Impact Of 'Concentration' Of Sales
E. Sale Or Retention Of The Seller's Closing Date Accounts Receivable
F. Issues In Valuing Closing Date Inventory
2:50 p.m. - 3:00 p.m.
Break
3:00 p.m. - 4:30 p.m.
X. Selected Deal Issues (Continued)
- Philip L. Chapman, Stephen Goldberg
and Kevin Groff
G. Retention Of A Key Employees; Timing Of Buyer's Access To Them
H. Landlords, Vendors And Other Third Party Consents
I. Security And Guaranties As To The Purchase Money Note; Restrictions On The Buyer Until The Note Is Paid
J. Security For Performance Of Seller's Indemnification Undertakings; Escrow; Non-Negotiable Notes
K. 'Transition Period' Services By The Seller's Principal(s) Or Selling Shareholder(s) Or Members
L. Environmental Condition Of The Business's Facility
M. Who Will Join In The Seller's Warranties And Representation?
N. Survival After The Closing Of Some Of The Warranties And Representations