Pre-closing disputes in M&A Setting the scene Prof. Henry Peter Warsaw, May 2010

2 I. Main phases Phases Signing Pre-signing Pre-closing Time Line Post-signing Post-closing Post-signing and pre-closing Closin g Events

3 II. Chronology (and logics) of the pre-closing phase Buyer’s due diligence (data room)(Audit) Letter of intent Purchase agreement (SPA) Confidentiality/ exclusivity agreement (s) Closing condition(s) (precedent) Time Line Facts Docs./ clauses Bidding process Information memorandum (Vendor’s due diligence) (Binding) offer ClosingSigning Negotiations

4 A.Procedural  Applicable law  Jurisdiction  Valid arbitration clause ?  Interim relief: where and what ?  Merit: where and what ?  Specific performance  Pre-signing: order to sign ?  Post-signing / pre-closing: order to close ?  Order to disclose ? III. Possible disputes

5 B.Merit  Letter of intent  Binding ?  Obligation to negotiate / act in good faith (culpa in contrahendo) ?  Obligation to inform ?  Type of damages  Benefit of the deal (“positive” interest in the performance of the contract)  Reliance damages (“negative” interest in the entering into the contract) III. Possible disputes

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