This website uses cookies to ensure you get the best experience on our website. Learn more

LPC Law Notes Private Acquisitions Notes

Asset Acquistion And Tupe Notes

Updated Asset Acquistion And Tupe Notes

Private Acquisitions Notes

Private Acquisitions

Approximately 339 pages

A collection of the best Mergers and Acquisitions* notes the director of Oxbridge Notes (an Oxford law graduate) could find after combing through dozens of LPC samples from outstanding students with the highest results in England and carefully evaluating each on accuracy, formatting, logical structure, spelling/grammar, conciseness and "wow-factor".

In short, these are what we believe to be the strongest set of Mergers and Acquisitions notes available in the UK this year. This collection is f...

The following is a more accessible plain text extract of the PDF sample above, taken from our Private Acquisitions Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

With reference to TUPE, the best thing to do is to read the Text Book pages 134 to 143 and cross reference the reading to the flowcharts on pages 150 and 151.

With Reference to the Asset Acquisition we quickly looked at the advantages and disadvantages between

Share Acquisition Asset Acquisition
Contracts No need to assign the contracts need to assign the cherry-picked contracts

Assignment and

Change of Control

Look out for change of Control Clauses.
  • The benefit of the Contracts can be freely assigned unless the contract forbids it, (But not the obligations/burden)

  • The burden – remains with the seller UNLESS Novation is used (Novation is rarely used due to the extensive negotiations to release the seller from his obligations)

Employment contracts No need to deal with the employment contracts as the employer stays the same, TUPE doesn’t apply. Need to deal with employment contracts TUPE applies as the employer changes.

We then Looked the difference between Novation, Assignment and Getting a whole new Contract.

Prep Task

Note: The answers to the questions are outlined here. You need to go directly to each clause to see how it answers the question. The Clauses are self-explanatory and therefore this is just the skeleton. Where more comment is needed I have added it.

Question 1 How does the agreement provide for the transfer of contracts where third party consent to the transfer is required but has nor been received by Completion?

Clauses 6.2(a)

Clause 6.2(b)

Clause 6.3

Clause 4.1(viii)

Question 2. Does the Agreement protect our clients passion in relation to any contracts that…

No protection in the agreement and therefore S will want a covenant form the B that it will meet obligations and that B will indemnify the S for any costs that it may incur for not performance by B of those contracts.

The contracts are transferred buy not Novated. Seller will have the burden while the B while have the benefit.

Question 3. Under the terms of the Agreement, what action must….

Book Debts are a benefit for the Buyer (these are debts owed to the company by DEBTORS)

Clause 2.1(c)

Clause 8

The value of the Book Debts is included in the purchase price. The buyer does not need to pay for the Valuing the Book Debt. See Note on YourLPC for what the Buyer can do on the DEBTORS side.

Question 4. How does the agreement provide for the transfer of….

Creditors are a burden for the Buyer (The business owes the money to the creditors)

Check the definition of creditors with the client – only trade creditors?

SPA is very Buyer friendly with regards to the creditors. See Note on YourLPC for what the Seller can do on the CREDITORS side.

Question 5. How does the Draft Agreement….

Clause 2.1 (Note the Business as a going concern)

Clause 2.2

Clause 2.3

B will want to add a warranty from the seller that all the listed assets in the SPA are all the assets necessary for the business (if the S breaches the warranty the Buyer may have some remedy)

Question 6.

Clause 2.1

Clause 4.1(b)

Clause 4.3

Question 7.

Clause 10 (restrictive covenants to protect the )

The problem with constructive covenants is that they may not be enforceable if they constrict trade. Therefore, the restrictive covenants should be reasonable.

Workshop Task

Question 1

Step 1: Will TUPE apply?

  • TUPE applies only to Asset Acquisitions

  • Regulation 3. TUPE applies only to Relevant Transfer

“A transfer of an undertaking, business or part… situated immediately before the transfer in the UK… where there is a transfer of an economic entity which retains its identity”

Step 2: Automatic transfer if employee assigned to organised grouping (unless employee objects)

  • Regulation 4(1) (there is an automatic transfer of contractual rights and obligations(including employment claims such as UD, WD and redundancy, but not, criminal liabilities and some pension...

Buy the full version of these notes or essay plans and more in our Private Acquisitions Notes.