1. Kevin Miller discusses the aftermath of the Toys-R-Us decision by Vice Chancellor Strine regarding potential conflicts of interest when an advisor provides both sell-side and buy-side services.
2. Miller believes Strine's criticism was focused on auctions where Revlon duties apply, not other M&A situations. Second opinions may be more useful outside of auctions to address duty of care concerns over conflicts.
3. While Strine was critical of "less distinguished" opinions, Miller believes smaller firms can provide valuable industry expertise. Strine also appeared to allow for stapled financing more than late approvals of buy-side work.
4. Ultimately, the key is for boards to clearly
This document is the copyright page and contents list for a book titled "Ultimate Home Buyers Guide" published by CelebrityPress. It provides information on copyright and publishing details for the book. The contents list previews 15 chapters on topics related to home buying such as hiring an agent, home buying strategies, negotiations, common mistakes to avoid, and more.
Valuing Real Estate Assets (Series: Fairness Issues in Real Estate-Based Bank...Financial Poise
As the expression goes, the value of real estate is in the eye of the beholder. Ultimately, the value is whatever the market is willing to pay. While income producing properties, particularly with creditworthy tenants, may be fairly routine to value based on the current rate of return demands in the market, non-income producing properties may be more speculative.
For example, even the most seasoned appraiser may struggle with finding comparative sales for a property. A landowner might see their property value go up exponentially “if only” the city council will allow for a zoning variance. Many an owner believes that their property is in the “path of progress,” but when? Is it reasonable to value a property “as stabilized” if it is only forty percent leased? These are the types of questions we will consider.
To view the accompanying webinar, go to: financialpoise.com/financial-poise-webinars/valuing-real-estate-assets-2021/
This document summarizes a law review article discussing the implications of the 2004 Consolidated Edison v. Northeast Utilities case. The case held that target company shareholders were not intended third-party beneficiaries of the merger agreement prior to the deal closing. As a result, target companies cannot recover shareholders' lost merger premium damages if a deal fails and may not be able to obtain specific performance. The article argues target companies should request provisions explicitly granting shareholders third-party beneficiary rights before closing and acknowledging the target's right to specific performance on shareholders' behalf. However, most public company merger agreements have not addressed the issues raised by the ConEd decision.
La organizacion en la administracion zarah britoZarahD
La organización en la administración supone establecer una estructura intencionada de los roles que los individuos deben desempeñar para cumplir las metas de una empresa. Significa integrar y coordinar los recursos humanos, materiales y financieros disponibles para lograr un objetivo dado con máxima eficiencia. Organizar implica identificar y clasificar las actividades requeridas para alcanzar los objetivos y coordinar horizontal y verticalmente la estructura asignando a cada grupo un líder con la autoridad para supervisarlo.
The Delaware Court of Chancery provided additional guidance for special committees and their advisors in related-party transactions based on its decision in Gesoff v. IIC Industries, Inc. The key lessons from the case are that special committees must have a clear mandate to negotiate vigorously on behalf of minority shareholders, engage competent and independent advisors, and ideally be comprised of more than one member. The court emphasized that the negotiation between a special committee and controlling shareholder should resemble an arm's-length negotiation between unrelated parties. The case also provided guidance for investment banks on valuation methodologies and directors on exculpatory provisions of Delaware law.
El documento describe cómo Dios pronunció los Diez Mandamientos a los israelitas desde el Monte Sinaí. Relata que Dios dio cinco de los mandamientos, incluyendo que los israelitas no debían tener otros dioses, hacer imágenes, usar el nombre de Dios en vano, o trabajar en el día de reposo. Explica que los mandamientos muestran a Dios como supremo y enseñan a los israelitas sobre su propio pecado.
Este documento define los elementos básicos de un cómic como una forma de comunicación gráfica que cuenta historias principalmente a través de imágenes. Explica que un cómic se compone de imágenes, texto y viñetas, y describe los personajes, globos, planos y técnicas utilizadas para crear cómics. También proporciona instrucciones sobre cómo crear un cómic desde la idea inicial hasta la producción final.
This document provides an analysis of the 1994 film Leon: The Professional. It summarizes the film's genre, narrative, characters, and themes. The genre is an action thriller. The narrative follows Leon, a hitman, who takes in and protects Mathilda, a 12-year-old girl, after her family is killed. They form an unconventional relationship and work together to avenge her family's death at the hands of the corrupt DEA agent Stansford. The analysis examines the characters of Leon, Mathilda, and Stansford and how they fit typical roles in action films. It also discusses themes of life and death, love and hate, and good versus evil portrayed in the film.
This document is the copyright page and contents list for a book titled "Ultimate Home Buyers Guide" published by CelebrityPress. It provides information on copyright and publishing details for the book. The contents list previews 15 chapters on topics related to home buying such as hiring an agent, home buying strategies, negotiations, common mistakes to avoid, and more.
Valuing Real Estate Assets (Series: Fairness Issues in Real Estate-Based Bank...Financial Poise
As the expression goes, the value of real estate is in the eye of the beholder. Ultimately, the value is whatever the market is willing to pay. While income producing properties, particularly with creditworthy tenants, may be fairly routine to value based on the current rate of return demands in the market, non-income producing properties may be more speculative.
For example, even the most seasoned appraiser may struggle with finding comparative sales for a property. A landowner might see their property value go up exponentially “if only” the city council will allow for a zoning variance. Many an owner believes that their property is in the “path of progress,” but when? Is it reasonable to value a property “as stabilized” if it is only forty percent leased? These are the types of questions we will consider.
To view the accompanying webinar, go to: financialpoise.com/financial-poise-webinars/valuing-real-estate-assets-2021/
This document summarizes a law review article discussing the implications of the 2004 Consolidated Edison v. Northeast Utilities case. The case held that target company shareholders were not intended third-party beneficiaries of the merger agreement prior to the deal closing. As a result, target companies cannot recover shareholders' lost merger premium damages if a deal fails and may not be able to obtain specific performance. The article argues target companies should request provisions explicitly granting shareholders third-party beneficiary rights before closing and acknowledging the target's right to specific performance on shareholders' behalf. However, most public company merger agreements have not addressed the issues raised by the ConEd decision.
La organizacion en la administracion zarah britoZarahD
La organización en la administración supone establecer una estructura intencionada de los roles que los individuos deben desempeñar para cumplir las metas de una empresa. Significa integrar y coordinar los recursos humanos, materiales y financieros disponibles para lograr un objetivo dado con máxima eficiencia. Organizar implica identificar y clasificar las actividades requeridas para alcanzar los objetivos y coordinar horizontal y verticalmente la estructura asignando a cada grupo un líder con la autoridad para supervisarlo.
The Delaware Court of Chancery provided additional guidance for special committees and their advisors in related-party transactions based on its decision in Gesoff v. IIC Industries, Inc. The key lessons from the case are that special committees must have a clear mandate to negotiate vigorously on behalf of minority shareholders, engage competent and independent advisors, and ideally be comprised of more than one member. The court emphasized that the negotiation between a special committee and controlling shareholder should resemble an arm's-length negotiation between unrelated parties. The case also provided guidance for investment banks on valuation methodologies and directors on exculpatory provisions of Delaware law.
El documento describe cómo Dios pronunció los Diez Mandamientos a los israelitas desde el Monte Sinaí. Relata que Dios dio cinco de los mandamientos, incluyendo que los israelitas no debían tener otros dioses, hacer imágenes, usar el nombre de Dios en vano, o trabajar en el día de reposo. Explica que los mandamientos muestran a Dios como supremo y enseñan a los israelitas sobre su propio pecado.
Este documento define los elementos básicos de un cómic como una forma de comunicación gráfica que cuenta historias principalmente a través de imágenes. Explica que un cómic se compone de imágenes, texto y viñetas, y describe los personajes, globos, planos y técnicas utilizadas para crear cómics. También proporciona instrucciones sobre cómo crear un cómic desde la idea inicial hasta la producción final.
This document provides an analysis of the 1994 film Leon: The Professional. It summarizes the film's genre, narrative, characters, and themes. The genre is an action thriller. The narrative follows Leon, a hitman, who takes in and protects Mathilda, a 12-year-old girl, after her family is killed. They form an unconventional relationship and work together to avenge her family's death at the hands of the corrupt DEA agent Stansford. The analysis examines the characters of Leon, Mathilda, and Stansford and how they fit typical roles in action films. It also discusses themes of life and death, love and hate, and good versus evil portrayed in the film.
Improve Your Threat Intelligence Strategy With These IdeasRecorded Future
Threat intelligence is a massive subject, and it’s natural to want to produce the most comprehensive range of intelligence possible … but that’s not always useful. In fact it’s usually not.
By concentrating intelligence efforts on highly specific business objectives (e.g., to maintain or improve profitability), this broad subject can be narrowed down to the point where a small amount of highly valuable intelligence is produced.
With this principle firmly in mind, let’s look at some ways to enhance your threat intelligence strategy.
PLI M&A 2017 - Advanced Trends Opening Remarks 1-12-17 (Display)Kevin Miller
This document provides an opening remarks summary for a conference on mergers and acquisitions trends from 2017. It discusses four significant trends from prior years that have affected Delaware litigation: 1) adoption of exclusive venue bylaws, 2) the M&F Worldwide decision permitting dismissal of claims with controller transactions under certain conditions, 3) the Cornerstone Therapeutics decision permitting dismissal of duty of care claims with an exculpatory clause, and 4) the Corwin v. KKR Financial decision establishing the business judgment rule for fully informed stockholder approved mergers. It then summarizes major mergers and acquisitions developments and cases from 2016 related to interpreting and applying the Corwin decision.
Este documento describe varios sitios del patrimonio cultural de América Latina que están inscritos en la Lista del Patrimonio Mundial de la UNESCO. Incluye información sobre la ubicación, año de inscripción y breve descripción de cada sitio, que abarcan desde manifestaciones de arte rupestre y arquitectura colonial hasta paisajes culturales y sitios arqueológicos que ilustran la historia de las civilizaciones precolombinas y la colonización europea en América Latina.
[Title page in French; Presentation in English] This is a presentation for an ICANN funded NPOC constituency group workshop in Dakar, Senegal (Jan 23, 2017). It deals with the notion of Internet Ecosystem citizenship and some of the issues around NGO use of social media and/or domain named websites in pursuit of their mission and vision.
Projet Erasmus+ La classe en action! Échange de bonnes pratiques innovantes dans l'enseignement des langues. Présentation montrée à l'Hôtel de Ville à Poperinge pendant la rencontre du 5 au 11 février 2017.
The document discusses conflicts of interest in business and recent corporate scandals. It examines four main areas where conflicts often arise: underwriting and research in investment banking, auditing and consulting in accounting firms, credit assessment and consulting in credit rating agencies, and universal banking. It also looks at policies implemented like Sarbanes-Oxley to address conflicts of interest in the wake of scandals.
The Role of Financial Advisors (PLI Doing Deals 2016) 2-10-16Kevin Miller
This document discusses the role of financial advisors and fairness opinions. It covers topics such as how financial advisors can serve as transaction brokers, financial advisors, and transaction facilitators for both sellers and buyers. It also discusses fairness opinions, including what they say, don't say, and the analyses that can underlie them. The document notes potential conflicts of interest for financial advisors and increased regulatory and judicial scrutiny of relationships and conflicts. It emphasizes the importance of disclosing material relationships and conflicts to boards.
The document discusses various topics related to finance and economics including barriers to entry in financial services due to reputation risk, how financial products and derivatives are developed from existing markets and business needs, and examples of regulatory arbitrage in developing new financial instruments.
Information on current issues involved with serving on a creditor committee. Topics include committee formation, pros, duties, areas of involvement, etc.
The document discusses the history and evolution of investment banking in the United States, including the Glass-Steagall Act of 1933 that separated commercial and investment banking. It describes the major investment banks and changes brought by the Gramm-Leach-Bliley Act of 1999 that repealed Glass-Steagall. The underwriting process for new securities issuances is explained in detail, along with variations like private placements. Studies show initial public offerings are underpriced on average but performance tends to level off over three years.
The document discusses the history and process of investment banking and secondary markets. It covers the Glass-Steagall Act of 1933 which separated commercial and investment banking. It also describes the underwriting process that investment banks use when bringing company stock and bond offerings to the public markets. This involves determining the offering price, marketing the securities, and sometimes stabilizing the aftermarket price.
Investment Banker - Issues and Considerations January PLI - 1-10-17Kevin Miller
This document discusses issues related to financial analyses underlying fairness opinions. It provides an overview of common analyses such as discounted cash flow, selected companies, and selected transactions. It notes that the purpose of a "football field" summary is to concisely outline key financial analyses for a fairness opinion in an easy to understand format. The document also discusses considerations in selecting methodologies, assumptions, and inputs for analyses and how different analyses have unique strengths and limitations given a company's specific facts and circumstances.
Ma and Pa invested their retirement savings based on the advice of an investment advisor. Their investments were in risky or fraudulent schemes that resulted in losses of most or all of their money. Now in their retirement with little income or assets, Ma and Pa are seeking ways to recover some of their losses. Potential avenues for recovery include pursuing legal action against the brokers and brokerage firms that sold them the investments, as these parties may have liability if they did not properly vet the investments or make suitable recommendations. Any funds recovered would likely only provide partial compensation and legal action could take several years.
Fundamentals of financial_institutions_powerpointhe22_sinceforum
This document discusses why financial institutions exist and some of the key concepts in financial markets and institutions. It covers transaction costs, asymmetric information including adverse selection and moral hazard, and conflicts of interest. Financial institutions help address issues like transaction costs, information problems, and principal-agent problems. They provide services that help the financial system function more efficiently through economies of scale and scope in producing and applying financial information. However, conflicts can arise when institutions have multiple objectives and competing interests.
The document discusses the current challenges facing 401(k) plan fiduciaries. It notes that fiduciaries are under increased pressure due to numerous lawsuits alleging excessive fees. The document recommends that fiduciaries delegate responsibilities, adopt passive investment strategies, provide full fee transparency to participants, offer education and advice programs, and regularly monitor fees and services. Fiduciaries need to ensure fees are reasonable and avoid potential conflicts of interest to limit their liability.
1. China recently experienced its first corporate bond default, which some see as the beginning of a potential credit crunch, but the Investment Committee views it positively.
2. They believe defaults are necessary to reduce moral hazard, incentivize reform, and introduce the concept of risk, whereas bailouts discourage financial discipline.
3. The default was small and expected, China has the power and resources to contain any crisis, and they can learn from mistakes made in other countries.
Financial Advisors in MA Transactions (PLI Trends) - 1-11-16Kevin Miller
This document summarizes key issues relating to the role of financial advisors in mergers and acquisitions (M&A) transactions. It discusses the narrow holding of the Delaware Supreme Court in RBC Capital Mkts. v. Jervis that an advisor can be liable for aiding and abetting a breach of fiduciary duty if it intentionally misleads or dupes the board. It also discusses the potential implications of Corwin v. KKR Financial Holdings, including whether stockholder approval of a transaction not subject to entire fairness review invokes the business judgment rule. Finally, it addresses the need to identify and disclose any actual or potential conflicts of interest between financial advisors and transaction participants.
The document discusses credit rating agencies and their role in evaluating the creditworthiness of corporations and governments that issue debt securities. It notes that credit rating agencies have been in existence since 1900 but it was in 1975 when the SEC formally recognized nationally recognized statistical rating organizations (NRSROs) and instructed broker-dealers to only use NRSRO ratings. The document goes on to discuss how financial institutions could satisfy capital requirements by investing in securities that received favorable ratings from NRSROs. It indicates that NRSROs are regulated by the SEC and that their ratings provide investors with objective analyses and independent assessments of risk associated with securities issued by corporations and governments.
The major credit rating agencies, Moody's, Standard & Poors, and Fitch, bear a heavy burden of responsibility for the financial meltdown. It was their seal of approval that enabled Wall Street to develop a multi-trillion-dollar market for bonds resting on a foundation of tricky loans and bubbly housing prices. Institutional investors around the world were seduced into buying these high-risk securities by credit ratings that made them out to be as safe as the most conventional corporate and municipal bonds.
Improve Your Threat Intelligence Strategy With These IdeasRecorded Future
Threat intelligence is a massive subject, and it’s natural to want to produce the most comprehensive range of intelligence possible … but that’s not always useful. In fact it’s usually not.
By concentrating intelligence efforts on highly specific business objectives (e.g., to maintain or improve profitability), this broad subject can be narrowed down to the point where a small amount of highly valuable intelligence is produced.
With this principle firmly in mind, let’s look at some ways to enhance your threat intelligence strategy.
PLI M&A 2017 - Advanced Trends Opening Remarks 1-12-17 (Display)Kevin Miller
This document provides an opening remarks summary for a conference on mergers and acquisitions trends from 2017. It discusses four significant trends from prior years that have affected Delaware litigation: 1) adoption of exclusive venue bylaws, 2) the M&F Worldwide decision permitting dismissal of claims with controller transactions under certain conditions, 3) the Cornerstone Therapeutics decision permitting dismissal of duty of care claims with an exculpatory clause, and 4) the Corwin v. KKR Financial decision establishing the business judgment rule for fully informed stockholder approved mergers. It then summarizes major mergers and acquisitions developments and cases from 2016 related to interpreting and applying the Corwin decision.
Este documento describe varios sitios del patrimonio cultural de América Latina que están inscritos en la Lista del Patrimonio Mundial de la UNESCO. Incluye información sobre la ubicación, año de inscripción y breve descripción de cada sitio, que abarcan desde manifestaciones de arte rupestre y arquitectura colonial hasta paisajes culturales y sitios arqueológicos que ilustran la historia de las civilizaciones precolombinas y la colonización europea en América Latina.
[Title page in French; Presentation in English] This is a presentation for an ICANN funded NPOC constituency group workshop in Dakar, Senegal (Jan 23, 2017). It deals with the notion of Internet Ecosystem citizenship and some of the issues around NGO use of social media and/or domain named websites in pursuit of their mission and vision.
Projet Erasmus+ La classe en action! Échange de bonnes pratiques innovantes dans l'enseignement des langues. Présentation montrée à l'Hôtel de Ville à Poperinge pendant la rencontre du 5 au 11 février 2017.
The document discusses conflicts of interest in business and recent corporate scandals. It examines four main areas where conflicts often arise: underwriting and research in investment banking, auditing and consulting in accounting firms, credit assessment and consulting in credit rating agencies, and universal banking. It also looks at policies implemented like Sarbanes-Oxley to address conflicts of interest in the wake of scandals.
The Role of Financial Advisors (PLI Doing Deals 2016) 2-10-16Kevin Miller
This document discusses the role of financial advisors and fairness opinions. It covers topics such as how financial advisors can serve as transaction brokers, financial advisors, and transaction facilitators for both sellers and buyers. It also discusses fairness opinions, including what they say, don't say, and the analyses that can underlie them. The document notes potential conflicts of interest for financial advisors and increased regulatory and judicial scrutiny of relationships and conflicts. It emphasizes the importance of disclosing material relationships and conflicts to boards.
The document discusses various topics related to finance and economics including barriers to entry in financial services due to reputation risk, how financial products and derivatives are developed from existing markets and business needs, and examples of regulatory arbitrage in developing new financial instruments.
Information on current issues involved with serving on a creditor committee. Topics include committee formation, pros, duties, areas of involvement, etc.
The document discusses the history and evolution of investment banking in the United States, including the Glass-Steagall Act of 1933 that separated commercial and investment banking. It describes the major investment banks and changes brought by the Gramm-Leach-Bliley Act of 1999 that repealed Glass-Steagall. The underwriting process for new securities issuances is explained in detail, along with variations like private placements. Studies show initial public offerings are underpriced on average but performance tends to level off over three years.
The document discusses the history and process of investment banking and secondary markets. It covers the Glass-Steagall Act of 1933 which separated commercial and investment banking. It also describes the underwriting process that investment banks use when bringing company stock and bond offerings to the public markets. This involves determining the offering price, marketing the securities, and sometimes stabilizing the aftermarket price.
Investment Banker - Issues and Considerations January PLI - 1-10-17Kevin Miller
This document discusses issues related to financial analyses underlying fairness opinions. It provides an overview of common analyses such as discounted cash flow, selected companies, and selected transactions. It notes that the purpose of a "football field" summary is to concisely outline key financial analyses for a fairness opinion in an easy to understand format. The document also discusses considerations in selecting methodologies, assumptions, and inputs for analyses and how different analyses have unique strengths and limitations given a company's specific facts and circumstances.
Ma and Pa invested their retirement savings based on the advice of an investment advisor. Their investments were in risky or fraudulent schemes that resulted in losses of most or all of their money. Now in their retirement with little income or assets, Ma and Pa are seeking ways to recover some of their losses. Potential avenues for recovery include pursuing legal action against the brokers and brokerage firms that sold them the investments, as these parties may have liability if they did not properly vet the investments or make suitable recommendations. Any funds recovered would likely only provide partial compensation and legal action could take several years.
Fundamentals of financial_institutions_powerpointhe22_sinceforum
This document discusses why financial institutions exist and some of the key concepts in financial markets and institutions. It covers transaction costs, asymmetric information including adverse selection and moral hazard, and conflicts of interest. Financial institutions help address issues like transaction costs, information problems, and principal-agent problems. They provide services that help the financial system function more efficiently through economies of scale and scope in producing and applying financial information. However, conflicts can arise when institutions have multiple objectives and competing interests.
The document discusses the current challenges facing 401(k) plan fiduciaries. It notes that fiduciaries are under increased pressure due to numerous lawsuits alleging excessive fees. The document recommends that fiduciaries delegate responsibilities, adopt passive investment strategies, provide full fee transparency to participants, offer education and advice programs, and regularly monitor fees and services. Fiduciaries need to ensure fees are reasonable and avoid potential conflicts of interest to limit their liability.
1. China recently experienced its first corporate bond default, which some see as the beginning of a potential credit crunch, but the Investment Committee views it positively.
2. They believe defaults are necessary to reduce moral hazard, incentivize reform, and introduce the concept of risk, whereas bailouts discourage financial discipline.
3. The default was small and expected, China has the power and resources to contain any crisis, and they can learn from mistakes made in other countries.
Financial Advisors in MA Transactions (PLI Trends) - 1-11-16Kevin Miller
This document summarizes key issues relating to the role of financial advisors in mergers and acquisitions (M&A) transactions. It discusses the narrow holding of the Delaware Supreme Court in RBC Capital Mkts. v. Jervis that an advisor can be liable for aiding and abetting a breach of fiduciary duty if it intentionally misleads or dupes the board. It also discusses the potential implications of Corwin v. KKR Financial Holdings, including whether stockholder approval of a transaction not subject to entire fairness review invokes the business judgment rule. Finally, it addresses the need to identify and disclose any actual or potential conflicts of interest between financial advisors and transaction participants.
The document discusses credit rating agencies and their role in evaluating the creditworthiness of corporations and governments that issue debt securities. It notes that credit rating agencies have been in existence since 1900 but it was in 1975 when the SEC formally recognized nationally recognized statistical rating organizations (NRSROs) and instructed broker-dealers to only use NRSRO ratings. The document goes on to discuss how financial institutions could satisfy capital requirements by investing in securities that received favorable ratings from NRSROs. It indicates that NRSROs are regulated by the SEC and that their ratings provide investors with objective analyses and independent assessments of risk associated with securities issued by corporations and governments.
The major credit rating agencies, Moody's, Standard & Poors, and Fitch, bear a heavy burden of responsibility for the financial meltdown. It was their seal of approval that enabled Wall Street to develop a multi-trillion-dollar market for bonds resting on a foundation of tricky loans and bubbly housing prices. Institutional investors around the world were seduced into buying these high-risk securities by credit ratings that made them out to be as safe as the most conventional corporate and municipal bonds.
Measuring The Intangibles A Schnur July2005AnthonySchnur
The document discusses the subjective factors that capital providers consider when evaluating potential investments. They look beyond quantifiable data to assess intangibles about management capability and the company-investor relationship. Capital providers form impressions throughout the acquisition process about what kind of client the company will be. They judge consistency, the ability to present a clear internal view, responsiveness to requests, and litigation history. How the company conducts itself in discussions conveys these intangibles that are important to securing funding.
Trends and Developments in M&A (Part I): Public Company TargetsWinston & Strawn LLP
The fourth installment of The Real Deal, “Trends and Developments in M&A (Part I): Public Company Targets,” was held on April 22, 2014, from 12:00 – 1:30 p.m. (Central). The Real Deal is a webinar series addressing current trends, challenges, and legal topics pertinent to M&A and securities professionals.
Today’s legal procedures and requirements for transactions involving public company targets are complex. Understanding the shifting landscape and the impact of recent Delaware statutes, cases, and deal trends is critical to getting the deal done. Winston & Strawn partners Oscar David, Eva Davis, and Rob Rawn presented an interactive webinar focused on what you need to know about the latest developments in M&A for public company targets.
This document discusses various sources of financing for startups, including self-funding, crowdfunding, equity financing, venture capital, business angels, and debt financing. It provides details on bootstrapping, the different types of angel and venture capital investors, and common terms in VC deals like liquidation preferences, blocking rights, and warrants. The document also notes that while hundreds of thousands of startups are formed each year, only a small fraction receive venture capital funding.
InDefenseStapledFinance - January 2006Kevin Miller
The document summarizes M&A activity in 2005. It states that worldwide M&A deals totaled $2.7 trillion in 2005, a 38% increase over 2004 and the highest level since 2000. In the US, M&A deals reached $1.1 trillion, a 33% increase over 2004 and the first time since 2000 that US deals surpassed $1 trillion. The largest deals included Procter & Gamble's $57 billion acquisition of Gillette and Burlington Resources' $37 billion acquisition of ConocoPhillips. Energy and power sector deals dominated both the US and worldwide markets as companies in those industries continued consolidating. Private equity firms also had an active year in both the US and
The Delaware Chancery Court decision on the merger between Tele-Communications, Inc. (TCI) and AT&T provided important guidance for special committees, but some of its views may not be entirely fair. Specifically, the court found issues with the independence of TCI's special committee and certain disclosures to shareholders, so the burden of proving fairness remained with the defendants. The case highlighted lessons for boards, including that special committees should have a clear mandate, fees should not be contingent on the transaction outcome, members' interests should align with shareholders, they need independent advisors, and should consider all information. However, some of the court's views on issues like contingent fees and fairness opinions are controversial.
DemiseofBroadlyWrittenMAC - November 2007Kevin Miller
This document discusses the SLM Corporation lawsuit against buyers who sought to back out of an acquisition agreement after legislation negatively impacted SLM's business. It analyzes the definition of a "material adverse effect" in the agreement and debates whether the court will focus on the plain language used, which favors the buyers, or take the perspective of a reasonable acquirer as in previous cases. The outcome could provide guidance on interpreting detailed MAE provisions with numerous exceptions.
Deal Lawyers - Knowing Participation Article 3-5-15Kevin Miller
1. The document discusses conflicting views on the "knowing participation" element of aiding and abetting claims in the context of "dead hand" change of control provisions in credit agreements.
2. It summarizes a Delaware Court of Chancery case, Healthways, where the court refused to dismiss aiding and abetting claims against an administrative agent for including a dead hand provision.
3. However, two subsequent Delaware Court of Chancery cases, Lee v Pincus and In re Comverge, applied a narrower definition of "knowing participation" that arguably would have led to dismissal in Healthways.
Investment Bank Engagement Letters - Selected Discussion Topics 9-12-14Kevin Miller
This document discusses key topics related to investment bank engagement letters, including: the scope of engagement (e.g. opinion only vs financial advisory), exclusivity, disclosure of opinions, information sharing responsibilities, fee structures, and indemnification provisions. It identifies issues for parties to consider when drafting engagement letters such as triggers for fees, tail periods, and standards for releasing the investment bank from liability other than for willful misconduct or gross negligence.
Dead Hand Change of Control Default Provisions PPT 3-25-15Kevin Miller
This document summarizes recent developments regarding dead hand change of control default provisions. It discusses the Healthways case in Delaware Chancery Court where the court found that lenders could potentially aid and abet fiduciary duty breaches by negotiating terms that create conflicts of interest for company directors. It also mentions several similar shareholder lawsuits filed against other companies and banks. The document reviews plaintiffs' attorneys fees awards in recent cases and potential alternatives for banks going forward regarding these contractual provisions. An appendix discusses precedent set in the Amylin and SandRidge cases regarding change of control provisions.
The document discusses several recent Delaware court cases that have implications for financial advisors, including In re Dole Food Co. shareholder litigation. It summarizes the key claims, findings, and conclusions of the Dole Food case, including that the court found the company's controller and president breached their fiduciary duties but did not find the financial advisor liable. It also summarizes allegations and issues discussed in In re PLX Technology and In re Zale Corp. shareholder litigation regarding potential conflicts of interest of financial advisors.
Selected Cases and Issues Regarding Projections 11-6-15 (One Hour Briefing)Kevin Miller
This document discusses issues related to financial projections in mergers and acquisitions transactions. It provides guidance on when and how projections should be prepared, the role of the board and counsel, dealing with unrealistic projections, disclosure obligations to buyers, and other issues that may arise regarding projections. Case law examples are also summarized to illustrate issues the courts have addressed related to management projections.
Rural-Metro - Aiding and Abetting (DealLawers) 3-9-16Kevin Miller
The document summarizes a Delaware Supreme Court case regarding aiding and abetting breach of fiduciary duty claims against a financial advisor, RBC Capital Markets. The key holdings were:
1) The board breached its fiduciary duties by approving a merger based on an unreasonable process influenced by RBC's actions to favor its own interests.
2) RBC knowingly participated in the breach by creating an informational vacuum and intentionally misleading the board, establishing scienter.
3) RBC was liable for aiding and abetting the breach of fiduciary duty, but financial advisors generally are not gatekeepers and liability requires egregious behavior like fraud on the board.
Fairness Opinions, Financial Analyses, Projections and the Role of Financial ...Kevin Miller
This document discusses fairness opinions, financial analyses, projections, and the role of financial advisors. It provides information on:
- What fairness opinions are, when boards want them, and when they are required. Fairness opinions evaluate whether consideration in a transaction is fair from a financial point of view.
- Key considerations for fairness opinions, including that they are limited in scope and do not substitute business judgment. Financial presentations to boards may be more valuable.
- What fairness opinions do and do not address, such as the relative merits of transactions or stock price after a deal.
- Common financial analyses used in fairness opinions like discounted cash flow, selected companies and transactions comparisons.
- Issues around projections
Fairness Opinions, Financial Analyses, Projections and the Role of Financial ...
Toys R Us - All Star Briefing
1. PLI: The Toys decision and Vice
Chancellor Strine’s subsequent
comments have generated a
fair amount of uncertainty and
confusion regarding the efficacy
of second opinions in the M&A
context. Can you give some
background and make some sense
of the decision and those comments
from a practitioner’s perspective?
KEVIN MILLER: First some
background. In the Toys-R-Us
(Toys) decision, Vice Chancellor
Strine criticized the decision of the
Toy’s board to allow its financial
advisor to finance the winning
bidder, creating “an appearance of
impropriety by taking $10 million
of fees for arranging financing for
the acquirers”
Point - “[The Financial Advisor]
did create for itself, and therefore
its clients, an unnecessary issue….
The [decision of the Financial
Advisor to request the Board’s
consent to provide financing to the
winning bidder] was unfortunate,
in that it tends to raise eyebrows
by creating the appearance of
impropriety, playing into already
heightened suspicions about the
ethics of investment banking firms.
Far better, from the standpoint
of instilling confidence, if [the
Financial Advisor] had never asked
for permission, and had taken the
position that its credibility as a
sell-side advisor was too important
in this case, and in general, for
it to simultaneously play on the
buy-side in a deal when it was the
seller’s financial advisor. In that
respect, it might have been better,
in view of [the Financial Advisor’s]
refusal to refrain, for the board of
the Company to have declined the
request, even though the request
came on May 12, 2005, almost two
months after the board had signed the
merger agreement.”
Counterpoint - “By stating this, I do
not want to be perceived as making
a bright-line statement. One can
imagine a process when a board
decides to sell an entire division or
the whole company, and when the
board obtains a commitment from its
financial advisor to provide a certain
amount of financing to any bidder,
in order to induce more bidders to
take the risk of an acquisition. These
and other scenarios might exist when
roles on both sides for the investment
banker would be wholly consistent
with the best interests of the primary
client company.”
Caution - “In general, however, it
is advisable that investment banks
representing sellers not create the
appearance that they desire buy-side
work, especially when it might be that
they are more likely to be selected by
some buyers for that lucrative role
than by others.”
Subsequently, at the 2006 Tulane
conference, Vice Chancellor Strine is
reported [in Corporate Control Alert]
to have clarified his views:
• [VC] Strine downplayed fears
that his ruling last year in a case
involving the LBO of Toys “R”
Us Inc. was meant to discourage
stapled financing…”
• “[m]any lawyers interpreted [VC
Strine’s critical comments in the
Toys decision] as a broad comment
on the practice of stapled financing
generally and discouraged
investment banks from offering
it when advising a target, or
recommended that banks not give
the target a fairness opinion when
they provide the staple.”
Fairness Opinions: When and Why Companies
Get a Second Opinion in the MA Context
Kevin Miller tries to bring clarity to the aftermath of Toys-R-Us
and Vice Chancellor Strine’s post-decision comments at Tulane
This Week
1. Kevin Miller (Alston Bird LLP) tries to bring clarity to the aftermath of Toys-R-Us and Vice
Chancellor Strine's post-decision comments at Tulane
2. Lee F. Bantle (Bantle Levy LLP) examines the tightrope act employers often have to perform when
it comes to the collision of claims of right between religious and non-religious employees
Next Week's All-Stars: M. Sean Royall (Gibson, Dunn Crutcher LLP)
1. Kevin Miller: Fairness Opinions: When and Why Companies Get a Second Opinion
in the MA Context
PLI: The Toys decision and Vice Chancellor Strine's subsequent comments have
generated a fair amount of uncertainty and confusion regarding the efficacy of second
opinions in the MA context. Can you give some background and make some sense of
the decision and those comments from a practitioner's perspective?
KEVIN MILLER: First some background. In the Toys-R-Us (Toys) decision, Vice
Chancellor Strine criticized the decision of the Toy's board to allow its financial
advisor to finance the winning bidder, creating an appearance of impropriety by
taking $10 million of fees for arranging financing for the acquirers
Point - [The Financial Advisor] did create for itself, and therefore its clients, an
unnecessary issue….The [decision of the Financial Advisor to request the Board's
consent to provide financing to the winning bidder] was unfortunate, in that it tends
to raise eyebrows by creating the appearance of impropriety, playing into already
heightened suspicions about the ethics of investment banking firms. Far better, from
the standpoint of instilling confidence, if [the Financial Advisor] had never asked for
permission, and had taken the position that its credibility as a sell-side advisor was
too important in this case, and in general, for it to simultaneously play on the buy-side
in a deal when it was the seller's financial advisor. In that respect, it might have been
better, in view of [the Financial Advisor's] refusal to refrain, for the board of the
Company to have declined the request, even though the request came on May 12,
2005, almost two months after the board had signed the merger agreement.
Counterpoint - By stating this, I do not want to be perceived as making a bright-line
statement. One can imagine a process when a board decides to sell an entire division
or the whole company, and when the board obtains a commitment from its financial
advisor to provide a certain amount of financing to any bidder, in order to induce more
By Kevin Miller
Thursday, August 10, 2006 Volume 4, Issue 30
This Week
1. Kevin Miller (Alston Bird LLP) tries to bring clarity to the aftermath of Toys-R-Us and Vice
Chancellor Strine's post-decision comments at Tulane
2. Lee F. Bantle (Bantle Levy LLP) examines the tightrope act employers often have to perform when
it comes to the collision of claims of right between religious and non-religious employees
Next Week's All-Stars: M. Sean Royall (Gibson, Dunn Crutcher LLP)
1. Kevin Miller: Fairness Opinions: When and Why Companies Get a Second Opinion
in the MA Context
PLI: The Toys decision and Vice Chancellor Strine's subsequent comments have
generated a fair amount of uncertainty and confusion regarding the efficacy of second
opinions in the MA context. Can you give some background and make some sense of
the decision and those comments from a practitioner's perspective?
KEVIN MILLER: First some background. In the Toys-R-Us (Toys) decision, Vice
Chancellor Strine criticized the decision of the Toy's board to allow its financial
advisor to finance the winning bidder, creating an appearance of impropriety by
taking $10 million of fees for arranging financing for the acquirers
Point - [The Financial Advisor] did create for itself, and therefore its clients, an
unnecessary issue….The [decision of the Financial Advisor to request the Board's
consent to provide financing to the winning bidder] was unfortunate, in that it tends
to raise eyebrows by creating the appearance of impropriety, playing into already
heightened suspicions about the ethics of investment banking firms. Far better, from
the standpoint of instilling confidence, if [the Financial Advisor] had never asked for
permission, and had taken the position that its credibility as a sell-side advisor was
too important in this case, and in general, for it to simultaneously play on the buy-side
in a deal when it was the seller's financial advisor. In that respect, it might have been
better, in view of [the Financial Advisor's] refusal to refrain, for the board of the
Company to have declined the request, even though the request came on May 12,
2005, almost two months after the board had signed the merger agreement.
Counterpoint - By stating this, I do not want to be perceived as making a bright-line
statement. One can imagine a process when a board decides to sell an entire division
or the whole company, and when the board obtains a commitment from its financial
advisor to provide a certain amount of financing to any bidder, in order to induce more
2. • such a reading “misconstrued” his
opinion. Apparently his concern
was that the seller’s board initially
refusedtoallowitsfinancialadvisor
toofferfinancingtobiddersandthen
changed its mind “for absolutely
no purpose. This was not adroit.
I could see situations where it
would be really good for a seller to
offer financing.”
• VC Strine also added that targets
didn’tbenefitfromhavingasecond
bank give a fairness opinion where
the primary adviser is offering a
staple. “running the auction is in
many ways the most important
part of the process…” Were he
a board member of a company
selling itself in an auction, he
would be of the belief that, “If [a
bank is] going to run the process,
they’re going to back it up by
giving a fairness opinion.”
• VC Strine expressed the view that
to get [a second] opinion, a target
must either pay a lot of money to
a first-tier firm or get an opinion
from a less-distinguished one,
which, the judge said “doesn’t
give me a lot of comfort. What’s
going to impress us about whether
you got a good deal is the quality
of the market check.” The second
opinion is “banker protection,”
he said, and does little to benefit
target shareholders.
In my mind, Vice Chancellor Strine’s
discussion of financing conflicts in
the Toys decision and his subsequent
comments at the Tulane conference
were intended to apply to auctions of
entire companies – that is, when the
Revlon rules apply. I don’t think his
comments at Tulane on the efficacy
of second opinions, were intended to
apply to other situations (e.g., when
the business judgment rule applies).
By their nature, auctions will, if
properly and fairly run, virtually
guarantee that the seller obtains the
highest and best price reasonably
available(i.e.satisfiestheRevlontest).
You don’t really need a first fairness
opinion, much less a second fairness
opinion (which only go to whether
the consideration to be received is fair
– not whether the board has obtained
the best price reasonably available) to
reach that conclusion so long as, and
this is the key, the auction process is
properly run.
That’s why, I think, when you look at
the Toys decision, and his subsequent
comments at the Tulane conference,
Vice Chancellor Strine is almost
entirely focused on process and
doesn’t appear to give a hoot about
fairness opinions. We’re talking
Revlonandnotthe“businessjudgment
rule” or traditional allegations that a
board breached its duty of care. In
fact, he seems to barely notice that
there was a second opinion provided
to the Toys board by Duff Phelps
– it’s given very little attention in the
Toys opinion.
When you take a closer look at the
Toys decision, two facts apparently
convincedViceChancellorStrinethat
the alleged conflicts did not infect the
auction process: (i) management was
not allowed to negotiate future roles
with bidders prior to the completion
of the auction; and (ii) Credit Suisse
First Boston, the financial advisor to
theToysboard,initiallyrecommended
that the board pursue a sale of the
Toys-R-Us business and the retention
of the Babies-R-Us business when a
sale of both businesses would have
resulted in a higher fee.
Such behavior, which was contrary
totheirself-interest,providedstrong
evidence that both management
and Credit Suisse First Boston
were acting in good faith to assist
the board in maximizing value and
that the auction process had not
been so infected as to prevent the
board from obtaining the best price
reasonably available.
In contrast, when you look at other
situations – e.g., where a company is
selling a subsidiary or a division or
engaging in a stock-for-stock merger,
situations in which the Revlon rules
do not apply – allegations that a
financial advisor was conflicted
can raise serious issues of material
fact as to whether the board was
acting reasonably in relying on the
fairness opinion of an allegedly
conflicted financial advisor. In those
circumstances, particularly in the
current environment where a board’s
actions are often examined under a
microscope, a board and its counsel
would probably be foolish not to
seriously consider obtaining a second
or independent opinion.
In many deals, particularly in large
transactions, the cost of an additional
opinionisquitesmallwhencompared
to the other costs of the transaction,
taken as a whole, and the substantial
benefits of the transaction to the
shareholders of the company. The
second opinion is likely to be given
even greater weight if the second
opinion provider is brought in earlier
rather than later in the transaction
process and has opportunities to
fully evaluate, and potentially have
an impact on, the structure and terms
of the transaction before it becomes
a “done deal.”
In summary, going back to the Toys
decision and Vice Chancellor Strine’s
comments at the Tulane conference,
there are four points I would make:
3. First, I don’t think second opinions
are worthless. Particularly in non-
Revlon cases, where plaintiffs can
raise an issue of fact as to whether
the board breached its duty of care
in relying on the fairness opinion
of an allegedly conflicted financial
advisor, I think second opinions can
be quite useful.
Second,IthinkViceChancellorStrine
appears to have unfairly disparaged
opinions provided by firms he
characterized as “less distinguished.”
Frankly, I’ve been impressed by the
quality of the opinions and analysis
provided by some of the smaller,
so-called “less distinguished” firms.
Often, their analysis reflects a more
detailed understanding and analysis
of a client’s business and its assets,
particularly if it has specialized
industry knowledge that is additive
and complimentary to the other
advice being provided to the client
and its board.
Third and somewhat perversely,
I think that putting the Toys decision
togetherwithViceChancellorStrine’s
subsequent comments at Tulane, it
appears that it may be easier for a
board to authorize stapled financing,
with its arguably inherent conflicts,
than for a board to release its
financial advisor to provide financing
even two months after the auction is
completed, as was the case in Toys,
when it’s hard to imagine that such a
remote prospect could have infected
the auction process.
On that point, my personal view
is that, despite Vice Chancellor
Strine’s comments to the effect that
apparently the Toys Board changed
its mind and agreed to release Credit
Suisse First Boston to finance the
winning bidder for absolutely no
purpose, I think there was probably
good reason for the Toys Board to
release CSFB. I think KKR was also
pressing the Toys Board to release
Credit Suisse First Boston to help
finance the purchase. Credit Suisse
First Boston had and continues to
have one of the largest and must
successful high yield financing
businesses and KKR presumably
wanted Credit Suisse First Boston
in its financing to enhance the
likelihood that the financing would
be consummated quickly and on
attractive terms. The fact that even
two months after the signing of the
merger agreement KKR was looking
for additional help with financing is
perhaps an indication that all was
not going well. Certainly, Credit
Suisse First Boston also wanted
the additional fees, but I think just
because KKR and Credit Suisse First
Boston would benefit from Credit
Suisse First Boston being released to
participate in the financing doesn’t
necessarily mean that the Toys
board acted irrationally or that the
Toys shareholders wouldn’t benefit
as well. By allowing KKR to have
CSFB involved in the financing, the
Toys Board reduced the risk that the
transaction wouldn’t close for lack
of financing, and probably allowed
the transaction to close sooner,
speeding the receipt of the merger
consideration by Toys shareholders.
If the record didn’t show that, then
it probably just goes to show the
importance of ensuring that there
is a good record to justify a board’s
actions – which is my fourth and last
and possibly most important point.
The ability to clearly demonstrate
that a board has evaluated the
benefits and risks of potential
conflicts is crucial. As you read the
key cases in this area, the biggest
issue is the occasional blindness of
people to the disadvantages or risks
associated with potential conflicts.
On the other hand, in those cases
where it’s clear that a board fully
understood and evaluated potential
conflicts and made a clear decision
that the benefits outweighed the
risks associated with that conflict, I
think courts have been reluctant to
second-guess the board’s judgment.
Reprinted with permission from PLI.