公司并购法律实务课程二

第二讲LOI,保密协议和并购财务基础知识与财务相关的并购条款并购中常用的财务术语估值会计准则和财务报告保密协议LOIorTermSheet与财务相关的并购条款并购中常用的财务术语估值会计准则和财务报告保密协议LOIorTermSheet1LOIorTermSheet1.1 定义

Letterofintent,termsheet,memorandumofunderstanding,headsoftermsareanagreementinprincipalbyapotentialbuyerandapotentialsellertofurtherconsidertheproprietyofdoingadeal.1LOIorTermSheet1.2LOI:ProsandCons1.2.1Whiletheremaybecompellingreasonsfortheparties’decisiontoforegoaletterofintent,incomplexdealsthepartiesareoftenbetterservedbytakingtheextratimetonegotiateanLOI.Amongotherthings,aletterofintentprovidesthepartieswithastructuretotheirdiscussionsandmaysetouttheparties’expectationsastohowthedealnegotiationswillproceed.Moreover,awell-craftedLOImaystreamlinedraftingandnegotiationofthedefinitiveacquisitionagreementandasaresultactuallyreducetransactiontimeandexpense.1LOIorTermSheet1.2LOI:ProsandCons

1.2.2It’squickerandeasiertoprepareandthereforeeasiertoreadandmorereadilyunderstoodbytheclient,andcanassistthepartiesandcounselinavoidingmisunderstandingsatanearlystage.1LOIorTermSheet1.2LOI:ProsandCons

1.2.3Itsetsforththemajortermstobereflectedintheacquisitionagreementandcanthereforefacilitatethepreparationoftheagreement.1LOIorTermSheet1.2LOI:ProsandCons

1.2.4Thebuyermayneedaletterofintenttopursuefinancingasbanks,equityinvestors,andotherfinancialinstitutionssometimeswillnotproceedwithaninvestigationandthedesiredcommitmentletteruntilaletterofintenthasbeensigned.1LOIorTermSheet1.2LOI:ProsandCons

1.2.5Incertaintransactions,aletterofintentallowstheprocessofobtaininggovernmentapprovalsorclearancestobegin.1LOIorTermSheet1.2LOI:ProsandCons

1.2.6Oftenbuyersarereluctanttocommittosubstantialexpensesforduediligencewithouthavingasignedletterofintent.1LOIorTermSheet1.2LOI:ProsandCons

1.2.7Businesspeoplebelievesthatsellersandbuyers,eveniftheymaynotbelegallybound,feelagreatmoralobligationtoobservethetermsandconditionssetforthinaletterofintentatlaterstageintheacquisitionprocess.1LOIorTermSheet1.2LOI:ProsandCons

1.2.8EitherpartymaybereluctanttoenterintoanLOIforfearofconcedingaparticularpointthathasnotbeenfullyvetted.Thismaybelessofanissueforthebuyerbecauseinalllikelihoodthebuyerwillhaveonlyundertakenlimited,ifany,duediligenceuptothatpointandwilltypicallyreserveitsrightstomodifycertaindealtermsbasedontheresultsofitsduediligencereview.1LOIorTermSheet1.2LOI:ProsandCons

1.2.9Oftentheletterofintentwillprovideforalimitedperiodofexclusivenegotiationbetweenthebuyerandseller.Thisisdisadvantageousfortheseller,butitisoneoftheprimaryreasonswhybuyersofteninsistthatthepartiesexecuteanLOI.1LOIorTermSheet1.3BindingorNon-binding

1.3.1Generally,anLOIwillbenon-bindingwithrespecttoallbutafewcertainprovisions.Typically,thebindingprovisionsinanLOIwillinvolve:confidentialityobligationsoftheparties;therightofthebyertohaveaccesstotheseller;anexclusivityperiod(i.e.,noshop)whichprovidesaperiodoftimeinwhichthebuyerhastheexclusiverighttonegotiatewiththeseller;therightofthebuyertoreceiveaterminationorbreak-upfeeintheeventthesellerwalksawayfromthedeal;theresponsibilityofthepartiesforcertaincostsandexpenses;thenon-bindingnatureofalltheotherprovisions.1LOIorTermSheet1.3BindingorNon-binding1.3.2CareshouldbetakentoensurethattheLOIistrulynon-binding,exceptasnotedabove,anddoesnotinadvertentlycreateabinding“agreementtonegotiate”definitiveterms.Insomejurisdictionscourtshaveprescribedso-called“magic”languagethatexpresslyremovesanysuchimplicitdutytonegotiate..1LOIorTermSheet1.3BindingorNon-binding

1.3.3(1)CaseStudy:Texaco,Inc.v.PennzoilCo:PennzoilhasnegotiatedwiththeGettyfamilyandtheGettyTrust,thecontrollingshareholdersofGettyOiltobuyacontrollinginterestinGettyOil.RepresentativesoftheGettyShareholdersenteredintoaMOUandissuedapressreleasethatstatedthatadefinitiveagreementwascontemplated.Neitherdocumentcontainedadisclaimerofabindingagreementorlegalobligation.Therewasalsoconsiderabledonedealtalkandconduct.1LOIorTermSheet1.3BindingorNon-binding

1.3.3(2)CaseStudy:ThenextdayGettyannouncedanagreementtoselltoTexacoatahigherprice,whichindemnifiedGettyagainstliabilitytoPennzoil.ATexanjuryrenderedaverdictof&7.53billionincontractdamagesand$3billioninpunitivedamagesinfavorofPennzoilagainstTexacoatatimewhenTexaco’sentirenetworthwasonly&9.5billion.Thecaseremainsthemostnotedletterofintentcaseandfeaturesmanyoftheissuesfoundinsuchcase:bindingeffectofpreliminarydocuments;referencetolaterdefinitiveagreement;donedealsyndrome;andparallelnegotiationandabrupttermination.1LOIorTermSheet1.4ElementsoftheLetterofIntentTosomeextent,thetermsoftheLOIwillmirrorwhatonewouldexpecttofindinthedefinitiveacquisitionagreement,onlywithlessspecificity.AtypicalLOIwilllikelyaddressatleastthefollowing:1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.1Assets/Stock—descriptionoftheassets(whichmaysimplybedescribedas“allorsubstantiallyall”oftheseller’sassets),orcapitalstocktobeacquired.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.2AcquisitionConsideration—considerationtobepaidbythebuyerinrespectoftheassetsorstockoftheseller(e.g.,cash,stock,earn-out,etc.)1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.3ClosingConditions—specifiescertainkeyclosingconditions,suchasvotingagreements(andproxies),votes/consentsrequired,requiredregulatoryapprovals,andrequiredthirdpartyconsents.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.4ClosingDate—generaltimetableforcompletingthetransaction.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.5CorporateApprovals—whetherstockholderconsentsare
requiredorwhetherastockholdermeetingwillbecalled.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.6DueDiligence—theparties’respectiveaccesstothebooksandrecordsoftheotherparty.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.7Escrow—amountofacquisitionconsiderationtobeescrowedorheld-backtobackstopindemnificationorotherpost-closingobligationsoftheseller.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.8GoverningLaw—legaljurisdictiongoverningthetermsofthetransaction,includingtheLOI.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.9 Representations&Warranties—scopeoftheseller’srepresentationsandwarranties(Note:becauseoftheabbreviatednatureofthetypicalLOI,partiesoftensimplyprovidefor“customary”representationsandwarranties,whichmaysetthestagefordisagreementduringnegotiationofthedefinitiveacquisitionagreement).1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.10Structure—whetherthetransactionwillbestructuredasamerger,assetacquisitionorstockpurchase.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.11Survival—lengthoftimeafterclosingthattheparties’representationsandwarrantieswillsurvive.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.12BoardRepresentation—whetherthesellerwouldretainanypost-closingrepresentationontheboardoftheacquiredentity.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.13EmploymentAgreements—ifthebuyeristoretaincertainkeymembersofmanagement,theLOImayconditionclosingofthedealonthebuyer’sabilitytonegotiatesatisfactoryemploymentagreementswithsuchmanagementmembers.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.14FeesandExpenses—anyspecialfeearrangementsamongtheparties.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.15Options—treatmentofoutstandingemployeestockoptionsuponconsummationofthetransaction(Note:termsoftheoptionplanandapplicableoptionagreementswillneedtobeconsidered).1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.16Publicity—whethereitherpartyispermittedtoannouncethetransaction(typicallythepartieswillagreetokeeptheLOIandproposedtransactionconfidential).1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.17Registration

Rights—buyer’sobligationtoregisteranyofitssecuritiesusedasacquisitionconsideration.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.17Registration

Rights—buyer’sobligationtoregisteranyofitssecuritiesusedasacquisitionconsideration.1LOIorTermSheet1.4ElementsoftheLetterofIntent1.4.18TaxTreatment—whetherthepartiesintendforthetransactiontoreceiveacertaintaxtreatment(i.e.,taxfreereorganization)
Whiletheremaybestrategicortacticalconsiderationsfortheparties’decisiontoforegoanLOI,ifthoughtfullyconsidered,aletterofintentmayprovidethepartiesanearlyindicatorofwhetherthereisindeedadealtobedone.与财务相关的并购条款并购中常用的财务术语估值会计准则和财务报告保密协议LOIorTermSheet2.1 保密信息的范围和定义（residual)；2.2 竞争对方之间的信息披露；2.3 保密信息的正当使用和披露范围（是否获得授权）；2.4 关于正在进行磋商的讨论（上市公司披露问题）。2保密协议2.5 法定披露事项；2.6 归还和销毁保密信息；2.7 禁止挖角和聘用人员及其例外情形；2.8 保密期限和Standstill条款2保密协议与财务相关的并购条款并购中常用的财务术语估值会计准则和财务报告保密协议LOIorTermSheet3会计准则和财务报告3.1GAAPGenerallyacceptedaccountingprinciple3会计准则和财务报告3.2PreparationoffinancialstatementsinconformitywithGAAPrequiresmanyestimates,judgmentsandassumptionsbymanagement.Absolute,mathematicalprecisionisneitherexpectednorachievableinfinancialstatements,whetherauditedorunaudited.Afairpresentationofthefinancialinformationinallmaterialrespectisthegoal;3会计准则和财务报告3.3Revenue,Goodwill,AccountsReceivables;Inventories;accountingisanartandnotascience;3会计准则和财务报告3.4“购买法“，goodwill被作为买方的资产

Theexcessofthecostoftheacquiredbusinessoverthesumoftheamountsassignedtoidentifiableassetsacquiredattheirfairvaluelesstheliabilitiesassumed.Impairmentandwrittendowniftheirfairvaluedeclinesbelowtheamountsonthebooks;3会计准则和财务报告3.5FinancialStatementsBalanceSheetisasnapshotasofaparticulardateoftheassets,liabilitiesandnetworthofabusiness;IncomeStatementreflectstheoperatingprofitorlossofabusinessoveraperiodoftime,itshowsallincomeandexpenseaccounts,measuresprofitabilityofthebusiness;StatementofCashFlows:(i)cashprovidedbyoperation;(ii)cashprovidedbyinvestment;(iii)cashprovidedbyfinancingactivities;3会计准则和财务报告3.6财务报表注释透露的信息与财务相关的并购条款并购中常用的财务术语估值会计准则和财务报告并购中律师必须要具备基础的财务知识LOIorTermSheet4并购中常用的财务术语4.1LiquiditymeasuresWorkingcapital:currentassets(cashandcashequivalents)-currentliabilities(withinoneyear);currentratio:currentassets/currentliabilities;networth:totalassets–totalliabilities;4并购中常用的财务术语4.2AccrualsandDeferralsAccrualismadewhenaneventshouldberecordedforaccountingpurposesduringacurrentperiodeventhoughpaymentwillnotbemadeuntilsomefutureperiod(预提)，例如：预提所得税、财务费用或者诉讼费用；adeferralismadewhenaneventshouldnotberecordedforaccountingpurposesuntilalaterperiodevenifthepaymentismadeinthecurrentperiod（递延）,例如预付款或者定金等，包括递延收入。4并购中常用的财务术语4.3DepreciationforthetangibleassetsandAmortizationfortheintangibleassets.与财务相关的并购条款并购中常用的财务术语估值会计准则和财务报告并购中律师必须要具备基础的财务知识LOIorTermSheet5与财务相关等并购条款5.1PurchasePriceAdjustment(balancesheetorientedandbasedonchangesinnetworthorworkingcapital)andEarnout(IncomeStatementdrivenandbaseduponpost-closingresultsofoperation);5与财务相关等并购条款5.2Representations

(i)FinancialStatement“fairlypresent”,inallmaterialrespects,thefinancialpositionandresultsofoperationofthetargetasoftherespectivedatesandfortheperiodsendingonsuchdates,allinaccordancewithGAAP.“Fairlypresent”meansthatthefinancialstatements,takenasawhole,aremateriallyaccurate”,butnotperfect;(ii)Booksof