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ACC ISRAEL ANNUAL CONFERENCE

ACC ISRAEL ANNUAL CONFERENCE. Identifying Concerns and Overcoming Risk in European M&A Opportunities Marc Fredj Simmons & Simmons Tel Aviv, Israel 16 June 2010. Identifying Concern and Overcoming Risk. Identifying concern: Access to information Identifying Concern: Due Diligence

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ACC ISRAEL ANNUAL CONFERENCE

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  1. ACC ISRAEL ANNUAL CONFERENCE Identifying Concerns and Overcoming Risk in European M&A Opportunities Marc Fredj Simmons & Simmons Tel Aviv, Israel 16 June 2010

  2. Identifying Concern and Overcoming Risk • Identifying concern: Access to information • Identifying Concern: Due Diligence • Identifying Concern: Disclosure • Overcoming Risk: Conditions Precedent • Overcoming Risk: MAC Clauses • Overcoming Risk: Price Adjustments • Overcoming Risks: Earn Outs • Overcoming Risk: Indemnities • Overcoming Risk: Warranties

  3. Identifying concern: Access to information • Auctions vs exclusivity situations • Private vs listed targets • NDAs • Signatories • Vendor protection • Timing of disclosure

  4. Identifying concern: Due Diligence • General purpose • Specific purpose • Types of due diligence – coordinating • Scope

  5. Identifying concern: Due Diligence • Materiality • Vendor due diligence • Data Rooms • Communicating results

  6. Identifying concern: Disclosure • Legal duty – contractual obligation • General vs Specific • Fair disclosure • Qualifications (materiality, knowledge) • Management’s position

  7. Overcoming risk: Withdrawing from transaction • Pre-contractual stage: • good faith • break fees • Contractual stage: • conditions precedent (validity; benefit) • MAC Clauses • Breach of warranties

  8. Overcoming risk: Adjusting value • Price Adjustment: • price determinable • recourse to experts • recovery: claims, escrow, deferred payments

  9. Overcoming risk: Adjusting value • Earn Outs: • determination • neutralizing certain changes • tax treatment

  10. Overcoming risk: Allocating identified and unidentified risks • Weaknesses of legal protections: • misrepresentation • eviction • hidden defects

  11. Overcoming risk: Allocating identified and unidentified risks • Indemnities: • when to use • difference with warranties

  12. Overcoming risk: Allocating identified and unidentified risks • Warranties • Scope • Indemnification: • net assets • loss • beneficiary and tax impact • Vendor protections

  13. Any questions please contact:marc.fredj@simmons-simmons.com

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