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Istanbul – 10 December 2011

Dealmaking and Agreement Management Jean-Hyacinthe de Mitry Attorney-at-law - Gide Loyrette Nouel AARPI Paris (France). Istanbul – 10 December 2011. I. Preparing the negotiations. The team The business targets The prior verifications The negotiation strategy The term sheet.

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Istanbul – 10 December 2011

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  1. Dealmaking and Agreement ManagementJean-Hyacinthe de MitryAttorney-at-law - Gide Loyrette Nouel AARPIParis (France) Istanbul – 10 December 2011

  2. I. Preparing the negotiations The team The business targets The prior verifications The negotiation strategy The term sheet

  3. I. Preparing the negotiations • The team • Whoshalldecide? Whoshallnegotiate? • Do I have the necessaryinternalresources? Do I needexternal support? • Technical • Financial • Legal. Do not underestimate the legal aspects of the deal: the team should comprise a lawyer (in-house or external). • Whowilldraft the agreement(s)? • How shall I communicatewithmy team? • Lack of internal coordination and communication maylead to the failure of the negotiations.

  4. I. Preparing the negotiations The business targets: always keep them on mind! What benefits (financial, operational, etc.) am I seeking? How do I want to reach them (acquisition, license, corporate deal, etc.)? Under what circumstances will the deal be worth making it? What is the best deal? What is to be avoided? What would be a win-win situation?

  5. I. Preparing the negotiations 3. The prior verifications • Me: is everything in order? • Do I own the IP? • Do I need to secure any rights / enter into any prior agreements with third parties? • What are my strengths and weaknesses? • Them: information on the other party • Its business (University, Investment company, Industrial company, etc.) • Its financial and legal capacity (published accounts, receivership, etc.) • Its IP (content, ownership, pending disputes, etc.) • Its team (who shall I negotiate with? Are they represented by a lawyer?) • The others: information on the alternatives • Are there alternative parties? • Are there alternative technologies?

  6. I. Preparing the negotiations • The negotiation strategy • Assessing the power of negotiation • Why does the other party wish to make the deal? • Are there alternatives? • What are my strengths and weaknesses? • Assessing the negotiation strategy • What will be my final word? My first offer? • What may be the other party’s final word? • What is my “BATNA” (= Best Alternative To a Negotiated Agreement)? • Assessing the negotiation agenda • How long should it take? • Are there time constraints (launch of a product, expiry of a patent, public subsidies to receive, change in the management, etc.)? • Are there prior agreements to sign (exclusive negotiation agreement, NDA, etc.)?

  7. I. Preparing the negotiations • The term sheet • Preliminary and unilateral document listing the main provisions of the agreement in a business language (“bullet points”) • Internal or external purpose • Advantages of drafting a term sheet: • Clarifies the main goal and stakes of the deal • Outlines the potential complex issues of the negotiation • Helps to coordinate the team

  8. II. Handling the negotiations Conduct of the negotiations Content of the negotiations After the negotiations

  9. II. Handling the negotiations • Conduct of the negotiations : basic rules • Assess the impact of the negotiated clauses on the business targets • Seekadvicefrom a lawyerprior and during the drafting and negotiation phase • Keepwritten traces of the respective wordingproposals: mark-ups, e-mails, etc. • Secure the negotiationswithpriornegotiationagreements • Non Disclosure Agreement • Letter of Intent and/or termsheet and/or MOU • Exclusivity of the negotiations • Agenda of the negotiations / duration of the LOI • Binding / Non binding

  10. II. Handling the negotiations 2. Content of IP negotiations: main clauses in patent and know-how license agreement • Scope of the license: identification of the patent and the know-how / territory • Exclusivity • Duration • Enhancements to the licensedtechnology • Financial provisions (royalties, payment, controls) • Handling of infringement actions • Preemption right / right of first refusal • Warranties • Confidentiality • Termination / consequences of termination

  11. II. Handling the negotiations After the negotiations The agreement begins Identify and inform the people in charge of the day-to-daycontractualrelationship Identify the clauses impliying a follow up of the contractualrelationship Keepwrittentracks of the day-to-day life of the agreement (e-mails, minutes of meetings, accounting documents, etc.)

  12. Thankyou for your attention ! mitry@gide.com

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