The deal is complete, and the parties have finished the hard work. Or have they? Integration planning turns to execution as people, process, and technology are combined once the deal is legally closed. The buyer will need to consider the purchased business or assets from the standpoint of employees, IT, customers, suppliers, and a multitude of other areas. In addition, numerous post-closing legal issues may arise, including purchase price adjustments, breaches of representations and warranties, enforcement of key negative employment-related covenants and restrictive covenants, collection of pre-closing accounts receivable, and true-ups of final financials. This episode guides listeners through the process, timing, and issues which most commonly arise after the closing of deals. To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/post-closing-issues-buyer-seller-disputes-2020/

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5. Disclaimer
The material in this webinar is for informational purposes only. It should not be considered
legal, financial or other professional advice. You should consult with an attorney or other
appropriate professional to determine what may be best for your individual needs. While
Financial Poise™ takes reasonable steps to ensure that information it publishes is accurate,
Financial Poise™ makes no guaranty in this regard.
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6. Meet the Faculty
MODERATOR:
Robert Londin - Jaspan Schlesinger LLP
PANELISTS:
Jonathan Friedland - Sugar Felsenthal Grais & Helsinger LLP
Phil Buffington - Adams and Reese LLP
Swata Gandhi - Saul Ewing Arnsteing & Lehr LLP
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7. About This Webinar – Post-Closing Issues:
Integration & Potential Buyer/Seller Disputes
The deal is complete, and the parties have finished the hard work. Or have they? Integration
planning turns to execution as people, process, and technology are combined once the deal
is legally closed. The buyer will need to consider the purchased business or assets from the
standpoint of employees, IT, customers, suppliers, and a multitude of other areas. In
addition, numerous post-closing legal issues may arise, including purchase price adjustments,
breaches of representations and warranties, enforcement of key negative employment-related
covenants and restrictive covenants, collection of pre-closing accounts receivable, and true-
ups of final financials. This episode guides listeners through the process, timing, and issues
which most commonly arise after the closing of deals.
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8. About This Series – Private Company M&A Boot Camp
This series features leading M&A attorneys and other deal professionals speaking about
private company M&A in roughly chronological order, guiding the audience through a
conversation that spans from deal origination, the LOI (letter-of-intent) or term sheet, due
diligence, document drafting and negotiation, closing, and post-closing. Issues addressed
include tax planning and structure; corporate governance; negotiating deal points and
common pitfalls and challenges; closing conditions; representations and warranties;
indemnification provisions; earn-outs; restrictive covenants; antitrust; intellectual property; and
employment. While many of the topics covered apply also to public company M&A, the focus
of this webinar series is on M&A involving a privately owned company or business.
Each Financial Poise Webinar is delivered in Plain English, understandable to investors, business owners, and
executives without much background in these areas, yet is of primary value to attorneys, accountants, and other
seasoned professionals. Each episode brings you into engaging, sometimes humorous, conversations designed to
entertain as it teaches. Each episode in the series is designed to be viewed independently of the other episodes so that
participants will enhance their knowledge of this area whether they attend one, some, or all episodes.
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9. Episodes in this Series
#1: Structuring and Planning the M&A Transaction
Premiere date: 7/23/20
#2: Key Provisions in M&A Agreements
Premiere date: 9/3/20
#3: The M&A Process
Premiere date: 10/1/20
#4: Post-Closing Issues: Integration & Potential Buyer/Seller Disputes
Premiere date: 11/5/20
#5: Negotiating an M&A Deal
Premiere date: 12/3/20
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10. Episode #4
Post-Closing Issues: Integration & Potential Buyer/Seller Disputes
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11. Post-Acquisition Integration = Merging operations,
finances, culture, etc. of acquired business with Buyer
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12. Goal=Synergy
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13. Asset or Equity Deal
• Asset Deal
 Does Buyer get Seller’s name?
 Who collects Seller’s A/R?
 Third party consents
 Handling of any pandemic PPP loans
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14. Asset or Equity Deal
• Equity Deal (other than if merger)
 Does Target entity remain?
o If not, issues related to transferring Target’s employees to benefits plans, stock
option plans, result
 Third party consents
 Handling of any pandemic PPP loans
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15. General Principles
• Direction from the top
• Begins pre-close
• Move fast before day-to-day business issues overshadow integration efforts
• Integration Manager (role should ideally start during due diligence)
• Role clarity
• Don’t permit bad behavior
• Consider when to inform target company employees of acquisition (adverse attrition and
confidentiality concerns)
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16. The “First 100 Days”
• Make decisions & set priorities
• Communication is key
• What communications will Seller/Target permit prior to closing?
 FAQs
 What stays the same?
 What changes?
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17. The Next 18 Months
• Implement decisions based on priorities
• Integration teams
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18. Substantive Areas
• IT
• Branding
• Risk management/insurance
• Legal/compliance
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19. Measuring Success Short Term
• Usable IT system
• Motivation/engagement
• Knowledge transfer
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20. Measuring Success Longer Term
• Retention of…
 Employees
 Customers
 Suppliers
 Physical facilities/workforce economies of scale
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21. Imperatives for PMI Success According to the Boston
Consulting Group
• Define first principles- the objectives and philosophy of the merger- and design the PMI
to reflect them
• Manage the PMI as a discrete process, separate from the day-to-day running of the
business
• Organize PMI teams to mirror the value drivers of the merger- and staff with the best
people
• Insist on senior leadership that is active, committed, and highly visible
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22. Imperatives for PMI Success According to the Boston
Consulting Group
• Maximize cost synergies but plan for revenue synergies as well
• Define explicit cost and revenue targets and revisit them continually throughout the PMI
• Retain current customers by making them an integral part of the PMI process
• Manage talent- by selecting, retaining, and developing the best people for the new
organization
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23. Imperatives for PMI Success According to the Boston
Consulting Group
• Design a workable organization structure for the combined company
• Recognize that PMI is an exercise in change management
• Assume that it is better to have “too much” communication than too little
• Manage the integration of organization culture with the same discipline and rigor as the
operational and financial integration
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24. Earn-Out Issues?
• Is there an earn-out in place, and if so, does it put any constraints on buyer in terms of
hiring and firing employees, amount of CapEx, etc.?
• Does the main acquisition agreement provide for any Buyer covenants with respect to the
earn-out (good faith and fair dealing; seller consent rights; limitations/adjustments based on
post-closing for other acquisitions or dispositions)
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25. Collection of Accounts Receivable (Generally Only
Applicable in an Asset Purchase)
• Who collects outstanding A/R as between Buyer and Seller?
• Are there restrictions in how collected A/R is to be accounted for?
• Additional payment to Seller as opposed to indemnification right for Buyer (and if so,
subject to cap and basket)?
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26. Post-Closing True-Up / Balance Sheet Adjustment
• Who does it and when?
• Right to contest; dispute resolution
• Additional payment to Seller as opposed to indemnification right for Buyer (and if so,
subject to cap and basket)?
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27. “Positive” Employment – and Consulting-Related
Responsibilities
• Employment and consulting agreements
• Difficulty of getting primary shareholders to remain engaged post-transaction?
• Non-employment and consulting transition services, such as any assignments, customer
and supplier introductions not done pre-closing, etc.
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28. “Negative” Employment and Consulting Restrictions
• Covenants not to compete
• Restrictions on soliciting employees, customers and business relations
• Enforceability concerns?
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29. Breaches of Representations and Warranties
• Anything in breach at the closing, and if so, is a suit cut off?
• How long do the representations and warranties survive after closing?
• Are there non-monetary limitations on indemnification claims (for example, obligation to
mitigate damages or pursue insurance)?
• Monetary limits (cap and basket)
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30. Breaches of Representations and Warranties
• Offset rights for Seller for Buyer’s insurance and tax recoveries
• Existing insurance (“occurrence”), tail or express M&A insurance?
• Analysis of tax benefit (loss) to otherwise indemnifiable losses
• Any reason Buyer might want to not seek indemnification even if it was or might be so
entitled?
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31. About the Faculty
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32. About The Faculty
Robert Londin - rlondin@jaspanllp.com
A partner in his firm’s Corporate and Commercial Transactions Group, Mr. Londin counsels
numerous companies in connection with their mergers and acquisitions (both strategic and
financial), financing needs and the execution of their business plans; financial concerns in
capital markets transactions; emerging-growth companies; seed and venture capital clients in
connection with the formation of their investment vehicles and making of their portfolio
company investments; borrowers and lenders in secured financings; and companies and
highly compensated executives in connection with their compensation and separation
arrangements. Rob serves as general counsel to many clients and their senior executives and
advisory boards. This general corporate representation covers day-to-day legal issues as well
as strategic planning and business development extending to acquisition and financing
concerns. He also represents technology and emerging-growth clients in connection with their
strategic alliances, technology licensing, mergers and acquisitions, corporate finance, venture
capital, banking transactions and general corporate needs.
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33. About The Faculty
Jonathan Friedland - jfriedland@sfgh.com
Jonathan Friedland, a senior partner with Sugar Felsenthal Grais & Helsinger, LLP, views his job simply:
to make money for clients whenever possible and to protect their interests at every turn. Licensed in four
states, Jonathan’s transactional work focuses on representing private funds and other owners of private
businesses, and the businesses they own. He regularly advises on M&A activities, structuring new
ventures and restructuring old ones, and on other commercial relationships. Jonathan is rated AV®
Preeminent™ by Martindale-Hubbell, 10/10 by AVVO, and enjoys several other similar distinctions.
Jonathan graduated from the State University of New York at Albany, magna cum laude (in three years)
and from the University of Pennsylvania Law School. He clerked for a federal judge before entering
private practice and served for several years as an Adjunct Professor of Strategic Management at the
University of Chicago’s Graduate School of Business. Jonathan is lead author and editor of several
significant treatises, several chapters in other treatises, and scores of articles on law and business.
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34. About The Faculty
Phil Buffington – Phil.Buffington@arlaw.com
Phil Buffington joined Adams and Reese in 2011 and serves as Leader of the Financial
Services Team, and is a Partner in the Transactions Practice Group. For more than 30 years,
Phil has served as a trusted advisor to community, regional and national financial institutions,
and he routinely helps these institutions assess and analyze regulatory and litigation risks.
His practice is focused primarily on the representation of financial institutions in corporate
governance, transactional and bankruptcy matters. He serves on the Adjunct Faculty Staff of
Mississippi College School of Law (Banking Law and Business Planning) and also serves as
a Faculty Member at the Mississippi School of Banking (Commercial Lending I and II). He is
a frequent speaker and presenter for CLE and other courses on topics related bank regulatory
matters, commercial lending, secured transactions and other banking topics.
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35. About The Faculty
Swata Gandhi – swata.gandhi@saul.com
Swata Gandhi concentrates her practice in general business and commercial law. Swata assists
businesses with significant transactions that help them adapt to the marketplace and support their daily
operations. This includes mergers and acquisitions, the purchase and sale of assets and businesses, and
commercial finance. She is experienced in counseling and assisting clients on a range of matters, from
protection and commercialization of intellectual property and licensing agreements to entity formation and
restructuring. She also handles employment issues and commercial contract drafting and negotiations,
including vendor agreements, distribution agreements, independent contractor agreements, statements
of work, and service agreements. She advises on compliance with various government regulations at
both the state and federal level, as well, and assists in the creation, development and implementation of
compliance programs. Prior to joining Saul Ewing Arnstein & Lehr, she was Vice President, General
Counsel and Chief Compliance Officer for a leading manufacturer of home repair products. Her roles
included leading legal, environmental and regulatory functions, and she re-imagined and modernized the
company's in-house legal department. Swata also worked as an associate at Ballard Spahr LLP and
Venable LLP before joining the in-house team at US Foods. Swata speaks Gujurati.
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36. Questions or Comments?
If you have any questions about this webinar that you did not get to ask during the live
premiere, or if you are watching this webinar On Demand, please do not hesitate to email us
at info@financialpoise.com with any questions or comments you may have. Please include
the name of the webinar in your email and we will do our best to provide a timely response.
IMPORTANT NOTE: The material in this presentation is for general educational purposes
only. It has been prepared primarily for attorneys and accountants for use in the pursuit of
their continuing legal education and continuing professional education.
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37. About Financial Poise
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