In M&A transactions, when parties are busy negotiating the terms, planning for the signing of the transaction agreements may be the last thing on their mind. Plan ahead for signing. 1. What needs to be delivered to the counterparty upon execution of the transaction agreements? 2. Ensure the resolutions which …

In M&A transactions, lawyers are naturally inclined to draft and negotiate agreements that put our clients in a strong legal position. That is our job. For a buyer, it may mean providing for the following in the sale and purchase agreement (SPA): – solid representations and warranties by the seller …

Consistency. Consistency matters a lot when drafting agreements. I was half amused and half exasperated when I saw an amended draft shareholders’ agreement which stated that shareholders may exercise certain rights by giving notice to the other shareholders. The next clause stated that the shareholders shall give notice to the …

Instead of a full legal due diligence report which sets out salient terms of contracts entered by the target companies, some buyers prefer to have a red flag report, which only highlights legal issues. In respect of contracts entered by the target companies, a red flag report may cover the …

I was involved in an initial public offering (IPO) and listing of a company (with subsidiaries) in the early stage of my career. That listed group then went on to acquire several companies and businesses through shares and assets acquisitions, which I was involved in. The terms for the consideration …

𝘜𝘴𝘦 𝘢 𝘵𝘦𝘳𝘮 𝘴𝘩𝘦𝘦𝘵 𝘧𝘰𝘳 𝘵𝘩𝘪𝘴 A term sheet is used in M&A transaction to set out the key commercial terms such as price, basis for price adjustment, earn out, profit guarantee and execution of new employment agreements with key employees of the target entity. The term sheet may be …

It drives me a bit crazy sometimes when parties to transaction agreements request for ambiguous provisions to be included into agreements. By that I mean provisions which beg one or a combination of the following questions: -What needs to be done to achieve the desired result? -Who is responsible? -How …

Preparing a shareholders’ agreement for an M&A transaction requires an in-depth understanding of shareholders’ rights and powers under the laws and the relationship between the shareholders. The table below sets out some of the rights and powers in respect of different levels of shareholding in a private company* limited by …

I was reminded of what Seth Godin said about practical empathy in a podcast while I was in a meeting that went on for hours to discuss an M&A transaction. It may not be verbatim. It went along the lines of “𝘱𝘦𝘰𝘱𝘭𝘦 𝘥𝘰𝘯’𝘵 𝘬𝘯𝘰𝘸 𝘸𝘩𝘢𝘵 𝘺𝘰𝘶 𝘬𝘯𝘰𝘸, 𝘥𝘰𝘯’𝘵 𝘸𝘢𝘯𝘵 𝘸𝘩𝘢𝘵 …

Clients always ask how long it would take to conduct legal due diligence, draft transaction agreements and complete the proposed acquisitions. The answer is “it depends”. The timeline depends on: – clients to provide the commercial terms they want and their comments to draft agreements; – target companies to provide …