Main Street v Wall Street Deals- Given that the most important M-A law generally includes large companies and demanding transactions, there is a tendency to lose sight of the fact that the fundamental proposals and fundamental legal principles of M-A apply to smaller and more mundane “Main Street” transactions, which are the bread and butter of most lawyers practising in this field. This is also the case when transaction partners operate in highly regulated sectors such as banking and telecommunications. Of course, not every step of the process does not apply to every transaction; Nor does any transaction raise securities laws or other federal law issues. The structure of the transaction, the objectives of the clients, the fiduciary duties of boards of directors and senior management, diligence, evaluation and final agreements, to name a few, are aspects of AM that apply to almost all OF the transactions of the BOARD. Yes, depending on the nature of the transactions and the financial capacity of the parties, practical solutions and compromises may need to be found. The important point here is that what you learn in this course should apply to most of the M-D transactions that you will deal with, regardless of their size, value or sector to which the parties are involved. Many students seem to have difficulty understanding this concept. For example, when they are valued with a $2 million deal, they often seem confused about how to deal with it. Someone is the buyer; someone is the seller, someone has to determine the purchase price, someone has to decide on the asset structure, merger or purchase of shares; There are certain business formalities that can be completed. He must be diligent. there must be a final agreement in one way or another, etc. The details may differ from a large public transaction, but the basic prism from which one can approach the transaction is not. Purchase Price Adjustment [post-closing] – A provision in many final agreements regarding a non-public purpose or seller, which adjusts the purchase price for changes in the seller`s situation between the date of the last transaction given to the buyer during due diligence and the transaction.
The adjustment of the purchase price is usually made after the close on the basis of a balance sheet drawn up by one party after the close, which the other party may object to. Of course, this is fertile ground for disagreements that the parties often expect by inserting into the agreement a provision of REL that usually brings the dispute to a large independent audit firm for settlement, much like the arbitration procedure, but generally based on written requests as opposed to testimony, witnesses, etc.