Mergers and Acquisitions: A Comprehensive Guide from Letter of Intent to Closing

82 questions on mergers and acquisitions, answered and cited by the UpLaw editorial team.

• Can a buyer escape a deal on the MAE clause alone?
• Can a non-binding LOI create a duty to negotiate in good faith?
• Can a purchase agreement eliminate liability for fraud?
• Does employment transfer automatically in an asset purchase?
• Does the implied covenant of good faith protect an earnout seller?
• How are escrows structured in a modern deal?
• How did RWI change private deal terms?
• How does an indemnity waterfall actually run?
• How does QSBS affect deal structure?
• How does the purchase price bridge from enterprise value to cash at closing?
• How does the WARN sale-of-business rule allocate responsibility?
• How do non-competes signed in connection with a sale differ from employment non-competes?
• How do state mini-WARN statutes differ from federal WARN?
• How do the deal structures map onto anti-assignment and change-of-control clauses?
• How do the three deal structures compare?
• How much is a materiality scrape worth in a real claim?
• How must an anti-reliance clause be drafted to work?
• How should a deal team manage the third-party consent problem?
• How should counsel describe the liability protection of an asset deal?
• How should wire instructions be verified at closing?
• Should indemnifiable Losses include multiple-of-earnings damages?
• What are the buyer's other closing conditions?
• What are the main due-diligence workstreams and where do they land in the agreement?
• What are the mechanics of a modern closing?
• What are the minority expansions of successor liability?
• What are the most common post-closing disputes?
• What are the nine principles of running an M&A deal?
• What are the recurring fights over disclosure schedules?
• What are the three functions of a representation in a purchase agreement?
• What are the three layers of law that govern an acquisition?
• What are the three parts of a modern MAE definition?
• What are the two jobs of due diligence?
• What are typical survival periods for representations?
• What constrains the interim operating covenants between signing and closing?
• What did AB Stable teach about the ordinary-course covenant?
• What does a well-run deal actually look like at closing?
• What does representation and warranty insurance not cover?
• What does the WARN Act require?
• What federal and state rules override the Meso Scale analysis?
• What federal successor-liability rules override state law?
• What is a materiality scrape?
• What is an asset purchase and how does it work mechanically?
• What is a Section 280G golden parachute problem and how is it cured?
• What is a Section 338(h)(10) election?
• What is representation and warranty insurance and how does it work?
• What is sandbagging and what happens if the agreement is silent?
• What is the accounting-principles hierarchy trap in a working capital adjustment?
• What is the bring-down condition and why does its standard matter?
• What is the default sandbagging rule in different states?
• What is the difference between a deductible basket and a tipping basket?
• What is the difference between a forward and a reverse triangular merger?
• What is the difference between an anti-assignment clause and a change-of-control clause?
• What is the difference between fundamental and business representations?
• What is the general rule on successor liability, and what are the exceptions?
• What is the purpose of a working capital adjustment?
• What is the trap in a stock purchase?
• What lessons come out of running the indemnity numbers?
• What made Akorn the first successful MAE case?
• What makes an exclusivity clause enforceable?
• What M&A-specific terms belong in a deal NDA?
• What operating covenants should an earnout seller negotiate?
• What other working capital traps recur?
• What parts of a letter of intent are binding?
• What privacy issues arise in an acquisition?
• What should a seller negotiate into an exclusivity provision?
• What standard do Delaware courts apply to MAE claims?
• When can an M&A transaction be tax-free?
• Which earnout metric should a seller prefer?
• Who controls the defense of a third-party claim after closing?
• Why are disclosure schedules the most underestimated document in a deal?
• Why do earnouts generate so much litigation?
• Why does a buyer prefer an asset purchase for tax purposes?
• Why does a C corporation seller fight so hard for a stock sale?
• Why does a competitor-buyer need a clean team during diligence?
• Why does "hereby assign" matter more than "agree to assign"?
• Why does the definition of "Knowledge" matter so much?
• Why does the target need a D&O tail policy?
• Why is contractor-written software the most common IP title defect?
• Why is deferred revenue so contentious in a SaaS working capital calculation?
• Why is the AGPL an existential issue for a SaaS target?
• Why is the "no binding agreement" clause the keystone of an LOI?
• Why is the reverse triangular merger the default structure in private tech M&A?