SESSION 3 ASSESSMENT for The Legal Cheek Commercial Awareness Academy 2023-24: Anatomy of a deal – with Fried Frank
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1. Which of these is NOT typically a route through which a deal comes to the attention of a client?
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Through pre-existing client relationships
Via an internet search by the client
Introduced to the buyer via investment banks
By members of the client’s team internally researching target firms
2. What is usually the first document introduced as part of a deal?
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Non-Disclosure Agreement (NDA)
Share Purchase Agreement (SPA)
Board minutes
High-level Term Sheet
3. Why is due diligence necessary? Pick the most appropriate answer.
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To get the inside gossip on the target business
To assess the red flags of the target business
To inform purchase price and protect against commercial risk
To satisfy your lawyers that you know the acquisition target well
4. Where are due diligence documents most likely to be found?
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In a room at a law firm which is stacked with folders of papers
In a due diligence bundle
In a due diligence online data room
In a signed due diligence statement
5. What is the purpose of a high-level term sheet?
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To decide on a timeline for the deal process
To negotiate on the parameters of the deal in terms of price, assets included and protections the client may want
To provide a broad summary of each aspect of the deal
To provide an overview of the parties’ motivations for entering into the deal
6. Which of these is NOT a role of scoping documents?
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To let the client know what sort of information is necessary to dig out at the due diligence stage
To figure out why the client is interested in the deal in question
To set out what sorts of things are fundamental to the business and so need to be examined in due diligence
To get the client’s sign off for the sorts of information the lawyers are going to be looking for in due diligence
7. Why would a law firm like Fried Frank engage third-party lawyers to help with a transaction? Pick the most appropriate answer.
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So that they do not have to do the work themselves
Because it is more economical
Because they do not have the capacity
To enlist lawyers with specialist knowledge of areas such an employment and pensions law
8. When the Share Purchase Agreement (SPA) is signed…
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Both the seller and the buyer are contractually bound to the transaction unless either party defaults on its terms
Both the seller and buyer are contractually bound to refrain from disclosing confidential information about the transaction
The transaction has completed
The shares of the target company are redistributed to reflect the terms of the transaction
9. Which of these is NOT a key document in the signing stage?
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Disclosure letter
Board minutes/shareholder resolutions
Finalised term sheet
Share Purchase Agreement (SPA)
10. Which of these documents do lawyers have to execute on completion?
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Instruments of Transfer (STF)
Due Diligence Red Flag Report
Non-Disclosure Agreement (NDA)
Vendor Diligence Completion Form
Calculation
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