1. What is the deal structure? How does this get initiated and approved? a. Deal type i.

Direct merger ii. Sale of assets/Acquisition iii. Forward or Reverse Triangular Merger iv. Stock sale v. Short form merger vi. LBO/MBO vii. De facto (not in Delaware) 1. YES Applestein 2. No Hariton (del), DMG(fla), BNY(ny) a. Also redemption is not a merger - Rauch viii. Bust-up ix. Merger of equals b. Voting powers, rights, and appraisal rights depend on deal type ASK: public or private? Type of consideration? THESE AFFECT VOTING RIGHTS! i. BOD Bidder (always votes/adopts resolution in merger) 1. in triangular acting under 141 and not a party to merger ii. BOD Target (always takes action) iii. BOD sub (triangular adoption resolutions though academic) iv. SH Bidder 1. do not vote if 251(f) applies v. SH Target 1. do not vote in acquisition if not all or sub all of assets 2. but if public company then Rule 312 could apply vi. SH sub 1. vote unless 251(f) applies c. Appraisal (FMV really only remedy besides injunction) i. Procedural rights ii. ONLY FOR MERGERS iii. No rights if 2000 SH or listed on stock exchange (market out) 1. but if consideration other than ALL stock then back 2. exception to exception applies whether public or private 2. What assets or liabilities are transferred in the deal? a. Type of deal affects who has what b. Real property (and leases) i. Presumption that alienable ii. If there is a clause look at state law to see if it is a transfer, and then if desired action is implicated c. IP rights & licenses i. Presumption that not alienable ii. SO need to determine under state law if transfer and then if yes if the clause in the K prevents assignability (take precautionary actions here) d. Contract (intent of the parties) e. Tort (in assets only if expressly/fraud/mere continuation/de facto) 3. Is the deal negotiated or hostile? a. Negotiations (start with letter of intent?) i. DUE DILIGENCE (V. IMPORTANT) ii. In agreement 1. Type of deal 2. Consideration for deal (earn-outs or escrow?) 3. Financing 4. Representations & Warranties

5. Covenants 6. Indemnifications 7. Conditions precedent (MAC/walk-away rights) b. Hostile i. Enhanced scrutiny to get BJR protection 1. Unocal 2. Revlon a. DO NOT NEED TO SELL if can meet Unocal b. Triggered when: i. Plan to sell company ii. Long-term strategy shot to shit iii. Change of control transaction ii. Defensive Tactics (planned/proportional?) 1. Moran planned are good 2. CCA when not in proportion, defensive not appropriate iii. Types of Defensive Tactics 1. poison pills 2. golden parachutes 3. lock up for crown jewels 4. debt w/warrants 5. pac man 6. no-shop/no-talk/window-shop/general exclusivity iv. SALE Revlon 1. GET HIGHEST PRICE FOR SH a. Any defensive tactics now need to increase value b. Equal access to data virtual data room c. Auctioneer d. Investment bankers e. Fairness opinions f. Independent board g. Firm best and last offer times h. Scripts i. Can consider other interests but only as to how they increase SH value 4. Any securities issues (are we dealing with a public company?) a. Rule 312 b. Registration or exemptions i. All transactions must be registered or exempt 1. exemptions 4(2)/Reg. D/ Rule 506 ii. SECONDARY SALES 1. 4(1) (other than underwriter, dealer or broker) 2. Rule 144 (restricted securities) 3. Rule 145 (if public, were okay!) c. Proxy (minimum disclosure requirements) d. Williams Act (Tender Offers) e. Liabilities i. Rule 10b-5 1. Materiality is test for disclosure 2. Rejects agreement in principle 3. If speak do not break the rule. a. Counsel issue confidentiality agreements, require that directors speak to counsel before speaking, provide same information to everyone, ban trading, and inform critical relationships of the deal ii. Insider Trading

1. falls under section 14 no fraudulent, deceptive or misleading acts in accordance with a tender offer. Against insider and outsider trading/includes tipper-tippee. a. Must disclose or abstain from trading iii. Short swing profits strict liability for D/O/10% SH 5. Fiduciary duties a. Care i. BJR protection unless fraud, illegality, conflict of interest or gross negligence. 1. safe harbor for conflicts 144 (or get off BOD!) ii. Additional protections: Del. 102(b)(7) and insurance b. Loyalty i. Conflict of interest (Weinberger if not cleansed need to meet intrinsic fairness) ii. Disclosure 1. disclose everything germane 2. if knowingly disclose false information and cause injury, liable to SH though dont request SH action WHY/WHAT BASIS DO SH SUE? Corporation failed to follow correct procedure Corporation breached securities laws Directors breached FD Trying to get more money