Countersign Merger Agreement Made Easy

Merge contract

hello and welcome to another video tutorial this time around we're going to be covering the definitive agreement which is a key part of any M&A process any M&A deal at least any M&A process that results in an actual closed deal and to go through it we're going to be looking at a key study or mini case study really of this ten point four billion dollar Amgen onyx deal in the pharmaceutical industry so I have up on screen a link to the actual agreement they call this agreement and plan of merger but really it is a definitive agreement between onyx the seller and then Amgen the buyer so we're going to be using that as our case study now just to remind you why does this matter what is important about this well the definitive agreement spells at the finalized key deal term so the price the form of transaction if there's cash involved versus stock if there is cash versus debt if it's a cash deal what the treatment of options is what the treatment of rsu's restricted stock units is so it spells out all those key terms and it directly impacts the effective purchase price of the deal now the reason why you have to care about this if you're going into Investment Banking or private equity or something else where you're buying and selling entire companies is that often you will have to create summaries that get passed on to your team that summarize these key deal terms and keep everyone in the loop also if you are running a merger model or evaluation of a deal for example you need to look at the agreement and look at the exact share counts the treatment of options and rsu's in the agreement in order to get all the numbers accurate so it is important lawyers do handle a lot of it but even if you are on the finance side you still need to understand these types of agreements how to read them and how to extract the key information now how do you read a definitive agreement what do you do where do you find them well for US based companies you can go to the Edgar site so I have a link in this excel file and if you go here you can just search by company name and bring up filings for companies now what I've already done here is in a separate window I've already brought up all the filings for onyx from a suitable and what you want to do here is look for anything that is labeled ek for us-based companies and the 8k filings will be the ones that actually contain the definitive agreement in most cases so there are a bunch of other filings remember a company announces an acquisition but that's usually the one that you want to be looking for for non-us based companies you'll have to go in the Investor Relations...