Which Business Sales Agreement Clauses to Read First

You know how it is: e-Commerce movers and shakers like bullet points. With too much to do, they have time to read only what really matters ' especially if it can fit on one screen.

But after finally making the difficult decision to sell the business that he or she built (for more specific information on that topic, see, 'Punk Rock and the Sale of Your e-Business' in the January 2007 edition of e-Commerce Law & Strategy), how does that entrepreneur react when his or her attorney sends 50 pages of fine print for review? It doesn't get any better when he asks for the 'key points' ' and finds that the 'summary' has 20 pages of said 'key points.'

Of course, even business attorneys will admit that not all of those words are truly important, or even worth reading. Yet, attorneys persist in what can seem like such logorrhea, the diarrhea familiar to anyone who has ever cared for a newborn, just coming from a word processor. While it may not have the smell or mess of the original, from the busy tech executive's perspective, it is just as much of a problem to deal with.

One Professional's Perspective

When I read and write business-acquisition agreements, I constantly hear requests for a 'simple' agreement, or put another way, the Chevrolet version, meaning that the client wants an agreement 'without all the bells and whistles,' as the ubiquitous they say. Yet the problem is that an attorney's bell or whistle could be his or her client's transmission or engine: No matter how much counsel can try to understand and to be involved in a clients' business, he or she cannot know all the details about it, much less every one of the details that might ' or will be ' critical in the negotiations. In fact, many businesses prefer to hold extensive talks to reach a so-called 'meeting of the minds' before turning on the fee meters for each partner, associate and paralegal involved in exploring, crafting and executing the deal. What counsel believes is important may have already been covered, and even dismissed, without his or her professional input.

Finally, I am not aware of any what we might call 'Chevrolet defense' to a malpractice claim; while it may sound like the proverbial pot calling the kettle black, our litigious society has forced attorneys to sell only 'luxury cars,' whether their clients want ' or are willing to pay for ' them or not.

Another point: As a professional duty, attorneys owe their clients a full explanation of the alternatives before them; sometimes, fulfilling that duty means just that there will be many words ' a particular reality for tech businesses, whose contracts often require detailed explanations of scientific matters or patents. And, if the contract concerns a new business model, then it may be necessary to explain it in the document, along with agreements on what to do if the deal (or the model) fails. One common solution to this necessity is to put the technical material in an exhibit that the principals can review separately (and more cheaply) than having counsel review what he or she may not understand anyway.

But perhaps there is a better way to identify the key provisions of a business sale agreement, to make the most efficient use of the businessperson's and the reader's time. What does an attorney read first in a new deal document? Does she sit down and read all the pages, cover to cover? Certainly, most attorneys do not, at least not on first reading; instead, most use their own method of legal triage, a mental list of the sections of an acquisition agreement that really affect whether a deal will succeed ' and that matter to clients. To paraphrase the revised Commandment in George Orwell's Animal Farm, 'All (sections) are equal but some (sections) are more equal than others.'

Most clients read the most critical section first ' the deal terms. But they should not assume ' perhaps trust is a better word ' that the deal is written as they understand it to be. They should instead focus with a critical analysis on one simple factual question: Does it accurately state the deal? I always ask clients to describe what they understand the deal to be, not in agreement or letter-of-intent form, but simply a list of all the points that have been discussed. That list should also include anything important to the deal that has been discussed, as well as points that have not been discussed but that are relevant, especially if the client thinks they are 'understood' or implicit. Often, the principals have key understandings about what will happen that their counterpart did not share, or even did not go out of his or her way to point out. For example (from an actual deal), in an asset sale agreement for a discontinued line, will the buyer of assets get the customer accounts and relationships serviced by the closed facility, or just the tangible assets at the location? Much expense and effort could have been saved if the buyer had realized that the seller was offering only the equipment, and not the business that went along with it. Even in simpler deals, the parties' expectations may be different, without them realizing it; one function of reading the business details of the agreement is to try to understand your adversary's unstated expectations.

Concerns That Arise, and Steps to Take

Similarly, do the verbal statements of complex financial terms and payment structures match the spreadsheets used by the negotiators? In such cases, attaching sample calculations, under several scenarios, can help guide a resolution of the difficult cases that often arise later.

It also helps to ask bluntly what the seller expects will happen on the day after closing, to be certain that the parties have a meeting of minds on 'relationship' issues, such as an employment agreement, continuing supply agreement, lease and other day-to-day needs that may have to be addressed in the transition sections of the agreement. Although most businesspeople will always read these sections of the agreement, especially if they are not long, they often do so without the correct perspective. By assuming that the statement of the deal is correct, clients may miss key implications of the document. For example, many may become intimidated by lengthy formulas or verbal descriptions of calculations and try to change or reduce them because of that length or complexity. But negotiating for changes to simplify those provisions may be counterproductive to the deal, such as by changing carefully crafted language, while ignoring other provisions (even shorter ones) that could be damaging.

Another area of constant client concern is the 'representation and warranty' section ' legalese for promises about the business being sold. Typically, these are phrased in the negative, and because of that, they can be hard to read and hard to understand. As a result, and because of the length of these sections, many clients try to eliminate as many of them as possible, in the name of simplicity.

That approach, however, ignores not only the realistic needs of the buyer, but also the dynamics of a well-negotiated deal. A buyer's attorney uses a comprehensive acquisition agreement as part of his or her due-diligence strategy to ferret out problems that may not have been discovered at an earlier stage. Wide-ranging representations not only try to force the seller to identify potential problems with the business ' including some that he or she may not have perceived as problems, such as for example, issues about benefits, or key business relationships that have not been firmed up in binding contracts ' but also, in a paradoxical way, make it easier and cheaper to produce a purchase agreement. Most firms have off-the-rack forms containing comprehensive promises about the business that can be delivered relatively quickly, through junior associates or even paralegals without, at the preliminary stage, the need for extensive substantive oversight by more expensive senior attorneys.

And such representations rarely vary much in substance from deal to deal (although details and language will rarely be the same). The EDGAR service of the U.S. Securities and Exchange Commission ('SEC') (and more user-friendly Web sites) that makes available actual acquisition agreements from deals involving public companies can easily be used to compare an agreement, to see whether it is following 'normal' or 'market terms,' or is overreaching. (See, for example, www.sec.gov/edgar/searchedgar/companysearch.html, www.secfilings.com, or www.onecle.com.)

What's Standard Just Isn't Standard Anymore

For tech and e-commerce firms, in particular, what is 'standard' can be a moving target due to the rapid development of online business, and the legal standards for it. The 'standard' Asset Purchase Agreement that worked well for many years with firms selling widgets and toasters will likely be missing many key provisions for firms that have no tangible existence, either at a location or their 'products' ' the 'state of the art' may be available only in the latest filings online. Perhaps more important, the attorney for a tech firm, working in close collaboration with his or her client, may need to create representations that address the business and technical issues the client actually cares about. While attorneys must pay attention to traditional ' and still critical ' matters, such as authorization of the deal and making sure that there are 'no conflicts' with key contract limitations such as those found in bank loans or distribution agreements, the client may care much more about the duration of key technology licenses, the ability to transfer key intellectual property or restrictions on resale or distribution of products.

Other areas potentially critical to an e-commerce business (and therefore worthy of their own representations) include domain name rights, claims of trademark infringement and contracts with fulfillment partners. Unlike the traditional business acquisition agreement, the contract for purchase of an e-commerce business requires substantial client input on what promises are made. Much like e-commerce's effects generally, this turns traditional contract drafting on its head, because counsel cannot a priori rely upon existing and tested forms. Instead, counsel must actually listen to what the client wants in the contract.

Conditions Precedent Offer Protection

If representations and warranties are important to the buyer, what can it do if the seller's assertions do not prove to be true? Can the buyer cancel the deal (possibly leaving customers and competitors with the knowledge that the business was in play, but failed to sell?). That is the purpose of the 'conditions precedent.' These are a particular concern of both sides: If the prospective buyer or seller can back out of the deal, not only will much have been wasted in time and effort, but some things cannot be undone. Once employees and customers know that a company is in play or seeking to buy another one, future behavior will be changed, regardless of confidentiality. For tech firms, in particular, disclosure of confidential information, especially to a competitor, cannot be taken back. And even if it is not used directly, that knowledge may lead to another, non-protected way of doing things, or identify potential customers that can be contacted through channels not restricted by confidentiality agreements.

Indemnify!

A more common remedy available to a wronged buyer is the right to indemnification: The greatest representation or warranty is worthless without an effective remedy. From the seller's perspective, how much of the purchase price will it be able to keep, and how much will be at risk to pay indemnity claims (and possibly the legal fees to fight them out)? No one wants to get a good price on the closing date, only to have to give it back in indemnity claims for breaches of the representations and warranties. In fact, even if a contract has buyer-oriented representations, the seller may still be able to protect itself by limiting the seller's remedies for breaches of them. An American Bar Association committee has prepared annual studies on what limitations are used in actual deals, culled from SEC filings involving private and public firms. Although the study itself is restricted to lawyers, summaries are available at www.haynesandboone.com/FILES/tbl_s12PublicationsHotTopics/PublicationPDF60/1696/09-14-06%20Wilson%20Chu.pdf and www.deallawyers.com/blog/archives/000647.html. The full text may be obtained through www.abanet.org/dch/committee.cfm?com=CL560003.

As a result of these concerns, the indemnity section is usually a far more interesting place to start reading a purchase agreement than any other and, in most cases, more important. If the seller's exposure is limited to a reasonable number ' whether contractually, by a 'cap' on any possible recovery, or practically, such as by the fact that the seller will strip all assets out of the selling entity immediately after the sale ' then the need to invest many hours and thousands of dollars in negotiating representations and warranties (and the conditions precedent that use them to determine whether the buyer can walk away from the deal without paying damages) decreases dramatically. So whatever one may feel about a particular representation, neither attorney nor client should get overly concerned about it before reading the corresponding indemnity for a violation of it, or thinking about whether the seller can actually pay it.

The Bottom Line: Getting Paid

Yes, everyone involved in a deal should think about the real bottom-line question: Can the buyer actually pay the purchase price, and what will happen if it does not? Although the first question is really outside the document, it should be addressed early in due diligence, and is really the answer to the question posed earlier as to what the client should read first. Why waste time and expense negotiating with a buyer who may not be able to close, or pay what it promised to pay? (If a business broker is involved, it generally will present only 'qualified' prospects that hopefully will make these concerns moot.)

Answers to the questions of 'what if the buyer doesn't pay' will be in sections labeled 'security' or 'collateral' ' what the seller will get if the buyer doesn't honor its deal. Certainly, getting fully paid at closing remains the best way to proceed in any sale of a business, but that often is not possible or realistic, especially when the buyer intends to bootstrap the cash flow to use for the purchase-price payments. Tech firms in particular may themselves be startups ' starved for the cash necessary to make a closing payment. But not all forms of security are created equal. While many sellers keep shares of the sold company as a pledge, or take a junior lien on the assets of the business that was sold (behind a bank lender), these techniques give the seller only limited protection: foreclosing on a security interest can take time and great expense and, if the buyer can't pay the purchase price, pledged shares of the company may be worthless.

A disappointed seller must also consider the risks to the business of suing the non-performing buyer. A collection action could create harmful publicity that could doom a startup. All these concerns about collecting the purchase price are even more important for e-commerce firms, where the critical assets are business intangibles, such as the company's name and Web site address, intellectual property and other items that may be difficult to turn into cash after a default. For that reason, it is important that the agreement provide for methods of transferring those assets on default that are as practical as for taking back tangible property, such as pre-signed papers to turn over control of a Web site's domain name, or collateral assignment papers that can be filed directly with the U.S. Patent and Trademark Office, or other agencies. But ultimately, the client reading these provisions must realize how difficult and expensive they can be to employ, and forcing the emphasis back on pursuing a deal with a firm that can reasonably be expected to pay, or finding a buyer that meets that criterion.

Lexus v. Chevy

Perhaps the most important part of an agreement for a buyer to read (albeit not always first) will not be delivered until after the typical agreement has been signed: the disclosure schedules. While some schedules may be purely informational, such as lists of tax-filing numbers or employees or the like, most will be full of 'exceptions' ' potential problems in the company to be sold ' that would make the representations incorrect if they had not been disclosed in advance, and in writing.

These are the meat that any buyer wants to bite into, sooner rather than later. Some of these may be revealed in normal due diligence, but others may arise for the first time when, as they say, the rubber meets the road ' at closing ' and disclosure is necessary to avoid a fraud claim.

Everyone involved in a deal will read a long acquisition agreement, but usually only a few key paragraphs matter. Just as the 'more equal' pigs seized control in Orwell's nightmare about the future, those key 'more equal' provisions described in this article should drive the negotiations, to help a seller try to get a Lexus for a Chevrolet price.

You know how it is: e-Commerce movers and shakers like bullet points. With too much to do, they have time to read only what really matters ' especially if it can fit on one screen.

But after finally making the difficult decision to sell the business that he or she built (for more specific information on that topic, see, 'Punk Rock and the Sale of Your e-Business' in the January 2007 edition of e-Commerce Law & Strategy), how does that entrepreneur react when his or her attorney sends 50 pages of fine print for review? It doesn't get any better when he asks for the 'key points' ' and finds that the 'summary' has 20 pages of said 'key points.'

Of course, even business attorneys will admit that not all of those words are truly important, or even worth reading. Yet, attorneys persist in what can seem like such logorrhea, the diarrhea familiar to anyone who has ever cared for a newborn, just coming from a word processor. While it may not have the smell or mess of the original, from the busy tech executive's perspective, it is just as much of a problem to deal with.

One Professional's Perspective

When I read and write business-acquisition agreements, I constantly hear requests for a 'simple' agreement, or put another way, the Chevrolet version, meaning that the client wants an agreement 'without all the bells and whistles,' as the ubiquitous they say. Yet the problem is that an attorney's bell or whistle could be his or her client's transmission or engine: No matter how much counsel can try to understand and to be involved in a clients' business, he or she cannot know all the details about it, much less every one of the details that might ' or will be ' critical in the negotiations. In fact, many businesses prefer to hold extensive talks to reach a so-called 'meeting of the minds' before turning on the fee meters for each partner, associate and paralegal involved in exploring, crafting and executing the deal. What counsel believes is important may have already been covered, and even dismissed, without his or her professional input.

Finally, I am not aware of any what we might call 'Chevrolet defense' to a malpractice claim; while it may sound like the proverbial pot calling the kettle black, our litigious society has forced attorneys to sell only 'luxury cars,' whether their clients want ' or are willing to pay for ' them or not.

Another point: As a professional duty, attorneys owe their clients a full explanation of the alternatives before them; sometimes, fulfilling that duty means just that there will be many words ' a particular reality for tech businesses, whose contracts often require detailed explanations of scientific matters or patents. And, if the contract concerns a new business model, then it may be necessary to explain it in the document, along with agreements on what to do if the deal (or the model) fails. One common solution to this necessity is to put the technical material in an exhibit that the principals can review separately (and more cheaply) than having counsel review what he or she may not understand anyway.

But perhaps there is a better way to identify the key provisions of a business sale agreement, to make the most efficient use of the businessperson's and the reader's time. What does an attorney read first in a new deal document? Does she sit down and read all the pages, cover to cover? Certainly, most attorneys do not, at least not on first reading; instead, most use their own method of legal triage, a mental list of the sections of an acquisition agreement that really affect whether a deal will succeed ' and that matter to clients. To paraphrase the revised Commandment in George Orwell's Animal Farm, 'All (sections) are equal but some (sections) are more equal than others.'

Most clients read the most critical section first ' the deal terms. But they should not assume ' perhaps trust is a better word ' that the deal is written as they understand it to be. They should instead focus with a critical analysis on one simple factual question: Does it accurately state the deal? I always ask clients to describe what they understand the deal to be, not in agreement or letter-of-intent form, but simply a list of all the points that have been discussed. That list should also include anything important to the deal that has been discussed, as well as points that have not been discussed but that are relevant, especially if the client thinks they are 'understood' or implicit. Often, the principals have key understandings about what will happen that their counterpart did not share, or even did not go out of his or her way to point out. For example (from an actual deal), in an asset sale agreement for a discontinued line, will the buyer of assets get the customer accounts and relationships serviced by the closed facility, or just the tangible assets at the location? Much expense and effort could have been saved if the buyer had realized that the seller was offering only the equipment, and not the business that went along with it. Even in simpler deals, the parties' expectations may be different, without them realizing it; one function of reading the business details of the agreement is to try to understand your adversary's unstated expectations.

Concerns That Arise, and Steps to Take

Similarly, do the verbal statements of complex financial terms and payment structures match the spreadsheets used by the negotiators? In such cases, attaching sample calculations, under several scenarios, can help guide a resolution of the difficult cases that often arise later.

It also helps to ask bluntly what the seller expects will happen on the day after closing, to be certain that the parties have a meeting of minds on 'relationship' issues, such as an employment agreement, continuing supply agreement, lease and other day-to-day needs that may have to be addressed in the transition sections of the agreement. Although most businesspeople will always read these sections of the agreement, especially if they are not long, they often do so without the correct perspective. By assuming that the statement of the deal is correct, clients may miss key implications of the document. For example, many may become intimidated by lengthy formulas or verbal descriptions of calculations and try to change or reduce them because of that length or complexity. But negotiating for changes to simplify those provisions may be counterproductive to the deal, such as by changing carefully crafted language, while ignoring other provisions (even shorter ones) that could be damaging.

Another area of constant client concern is the 'representation and warranty' section ' legalese for promises about the business being sold. Typically, these are phrased in the negative, and because of that, they can be hard to read and hard to understand. As a result, and because of the length of these sections, many clients try to eliminate as many of them as possible, in the name of simplicity.

That approach, however, ignores not only the realistic needs of the buyer, but also the dynamics of a well-negotiated deal. A buyer's attorney uses a comprehensive acquisition agreement as part of his or her due-diligence strategy to ferret out problems that may not have been discovered at an earlier stage. Wide-ranging representations not only try to force the seller to identify potential problems with the business ' including some that he or she may not have perceived as problems, such as for example, issues about benefits, or key business relationships that have not been firmed up in binding contracts ' but also, in a paradoxical way, make it easier and cheaper to produce a purchase agreement. Most firms have off-the-rack forms containing comprehensive promises about the business that can be delivered relatively quickly, through junior associates or even paralegals without, at the preliminary stage, the need for extensive substantive oversight by more expensive senior attorneys.

And such representations rarely vary much in substance from deal to deal (although details and language will rarely be the same). The EDGAR service of the U.S. Securities and Exchange Commission ('SEC') (and more user-friendly Web sites) that makes available actual acquisition agreements from deals involving public companies can easily be used to compare an agreement, to see whether it is following 'normal' or 'market terms,' or is overreaching. (See, for example, www.sec.gov/edgar/searchedgar/companysearch.html, www.secfilings.com, or www.onecle.com.)

What's Standard Just Isn't Standard Anymore

For tech and e-commerce firms, in particular, what is 'standard' can be a moving target due to the rapid development of online business, and the legal standards for it. The 'standard' Asset Purchase Agreement that worked well for many years with firms selling widgets and toasters will likely be missing many key provisions for firms that have no tangible existence, either at a location or their 'products' ' the 'state of the art' may be available only in the latest filings online. Perhaps more important, the attorney for a tech firm, working in close collaboration with his or her client, may need to create representations that address the business and technical issues the client actually cares about. While attorneys must pay attention to traditional ' and still critical ' matters, such as authorization of the deal and making sure that there are 'no conflicts' with key contract limitations such as those found in bank loans or distribution agreements, the client may care much more about the duration of key technology licenses, the ability to transfer key intellectual property or restrictions on resale or distribution of products.

Other areas potentially critical to an e-commerce business (and therefore worthy of their own representations) include domain name rights, claims of trademark infringement and contracts with fulfillment partners. Unlike the traditional business acquisition agreement, the contract for purchase of an e-commerce business requires substantial client input on what promises are made. Much like e-commerce's effects generally, this turns traditional contract drafting on its head, because counsel cannot a priori rely upon existing and tested forms. Instead, counsel must actually listen to what the client wants in the contract.

Conditions Precedent Offer Protection

If representations and warranties are important to the buyer, what can it do if the seller's assertions do not prove to be true? Can the buyer cancel the deal (possibly leaving customers and competitors with the knowledge that the business was in play, but failed to sell?). That is the purpose of the 'conditions precedent.' These are a particular concern of both sides: If the prospective buyer or seller can back out of the deal, not only will much have been wasted in time and effort, but some things cannot be undone. Once employees and customers know that a company is in play or seeking to buy another one, future behavior will be changed, regardless of confidentiality. For tech firms, in particular, disclosure of confidential information, especially to a competitor, cannot be taken back. And even if it is not used directly, that knowledge may lead to another, non-protected way of doing things, or identify potential customers that can be contacted through channels not restricted by confidentiality agreements.

Indemnify!

A more common remedy available to a wronged buyer is the right to indemnification: The greatest representation or warranty is worthless without an effective remedy. From the seller's perspective, how much of the purchase price will it be able to keep, and how much will be at risk to pay indemnity claims (and possibly the legal fees to fight them out)? No one wants to get a good price on the closing date, only to have to give it back in indemnity claims for breaches of the representations and warranties. In fact, even if a contract has buyer-oriented representations, the seller may still be able to protect itself by limiting the seller's remedies for breaches of them. An American Bar Association committee has prepared annual studies on what limitations are used in actual deals, culled from SEC filings involving private and public firms. Although the study itself is restricted to lawyers, summaries are available at www.haynesandboone.com/FILES/tbl_s12PublicationsHotTopics/PublicationPDF60/1696/09-14-06%20Wilson%20Chu.pdf and www.deallawyers.com/blog/archives/000647.html. The full text may be obtained through www.abanet.org/dch/committee.cfm?com=CL560003.

As a result of these concerns, the indemnity section is usually a far more interesting place to start reading a purchase agreement than any other and, in most cases, more important. If the seller's exposure is limited to a reasonable number ' whether contractually, by a 'cap' on any possible recovery, or practically, such as by the fact that the seller will strip all assets out of the selling entity immediately after the sale ' then the need to invest many hours and thousands of dollars in negotiating representations and warranties (and the conditions precedent that use them to determine whether the buyer can walk away from the deal without paying damages) decreases dramatically. So whatever one may feel about a particular representation, neither attorney nor client should get overly concerned about it before reading the corresponding indemnity for a violation of it, or thinking about whether the seller can actually pay it.

The Bottom Line: Getting Paid

Yes, everyone involved in a deal should think about the real bottom-line question: Can the buyer actually pay the purchase price, and what will happen if it does not? Although the first question is really outside the document, it should be addressed early in due diligence, and is really the answer to the question posed earlier as to what the client should read first. Why waste time and expense negotiating with a buyer who may not be able to close, or pay what it promised to pay? (If a business broker is involved, it generally will present only 'qualified' prospects that hopefully will make these concerns moot.)

Answers to the questions of 'what if the buyer doesn't pay' will be in sections labeled 'security' or 'collateral' ' what the seller will get if the buyer doesn't honor its deal. Certainly, getting fully paid at closing remains the best way to proceed in any sale of a business, but that often is not possible or realistic, especially when the buyer intends to bootstrap the cash flow to use for the purchase-price payments. Tech firms in particular may themselves be startups ' starved for the cash necessary to make a closing payment. But not all forms of security are created equal. While many sellers keep shares of the sold company as a pledge, or take a junior lien on the assets of the business that was sold (behind a bank lender), these techniques give the seller only limited protection: foreclosing on a security interest can take time and great expense and, if the buyer can't pay the purchase price, pledged shares of the company may be worthless.

A disappointed seller must also consider the risks to the business of suing the non-performing buyer. A collection action could create harmful publicity that could doom a startup. All these concerns about collecting the purchase price are even more important for e-commerce firms, where the critical assets are business intangibles, such as the company's name and Web site address, intellectual property and other items that may be difficult to turn into cash after a default. For that reason, it is important that the agreement provide for methods of transferring those assets on default that are as practical as for taking back tangible property, such as pre-signed papers to turn over control of a Web site's domain name, or collateral assignment papers that can be filed directly with the U.S. Patent and Trademark Office, or other agencies. But ultimately, the client reading these provisions must realize how difficult and expensive they can be to employ, and forcing the emphasis back on pursuing a deal with a firm that can reasonably be expected to pay, or finding a buyer that meets that criterion.

Lexus v. Chevy

Perhaps the most important part of an agreement for a buyer to read (albeit not always first) will not be delivered until after the typical agreement has been signed: the disclosure schedules. While some schedules may be purely informational, such as lists of tax-filing numbers or employees or the like, most will be full of 'exceptions' ' potential problems in the company to be sold ' that would make the representations incorrect if they had not been disclosed in advance, and in writing.

These are the meat that any buyer wants to bite into, sooner rather than later. Some of these may be revealed in normal due diligence, but others may arise for the first time when, as they say, the rubber meets the road ' at closing ' and disclosure is necessary to avoid a fraud claim.

Everyone involved in a deal will read a long acquisition agreement, but usually only a few key paragraphs matter. Just as the 'more equal' pigs seized control in Orwell's nightmare about the future, those key 'more equal' provisions described in this article should drive the negotiations, to help a seller try to get a Lexus for a Chevrolet price.