Acquisitions & Agreement Negotiation

Acquisitions

The firm represents companies seeking to acquire targets in the U.S.  These acquisitions are generally strategic in nature, and we frequently assist in analyzing the strategic value of the deal and how best to accomplish and preserve the value of the acquisition.  Given the propensity of Americans to utilize lawyers, it is critical to get a U.S. lawyer involved at an early stage of discussions.  A Confidentiality Agreement should be executed, preferably with provisions that grant the acquirer some exclusive negotiating rights over a specified term.  The Letter of Intent, which needs specific language confirming that it is not binding, includes increasing amount of detail relating to the deal.  In fact, recent deals have resulted in the Letter of Intent looking more like the Definitive Acquisition Agreement.  This is in order to expedite the negotiations and ensure that the time and money spent on due diligence is justified.

Focus in acquisitions is on ensuring that the client knows exactly what it is acquiring, with an understanding of the consequences of each facet of the purchase; so that the client can make an informed decision as to the value of the transaction, and the risks associated with it.  The firm provides a somewhat unique form of due diligence, namely informing clients of risks or areas meriting further investigation.  If the client assesses that there is no need for further investigation, the issue is dropped.  Many firms cannot afford to allow issues that they believe need to be further investigated, to be dropped, due to self insurance of professional liability.

Agreement Negotiation

Tom Thorelli has devoted more of his time to the drafting and negotiating of agreements than anything else in his 33 years of practice.  The firm prides itself on adding substantial value to the protection of client’s interests.  Focus is placed on retaining control (information) and flexibility (simple and straightforward termination rights), rather than agreements that may promise gold at the end of the rainbow, but ultimately are unrealistic.  Creating win-win situations for the parties is the optimal result.

Clients are sometimes advised to not enter into agreements based on the onerous terms proposed by the other side; or because the client simply doesn’t have the resources to effectively manage the relationship.  Other times, when clients seek “air tight” agreements because they do not trust the other side, they are counseled to walk away from such a deal.  Written agreements cannot, by themselves, create the atmosphere of trust and collaboration that is the most essential cornerstone to a successful relationship.