Distressed M&A: a golden year yet to come?

31 Maggio 2021

  • Ucraina
  • Diritto societario
  • Fallimentare
  • M&A

There were hardly even a few businesses worldwide not affected by the corona pandemic. As lockdown measures were expanding from March 2020, dozens of visitor-dependent (including retail, public transportation, HoReCa, leisure, entertainment & sport) companies’ value dropped astonishingly. This immediately resulted in numerous RFPs coming in and out NPL funds and distress investors being ready as never to pluck those companies ripe enough.

Well, at least that is how the things should have been.

A general picture of M&A demand remains with no great changes. According to the recent DataSite EMEA report first 2021 quarter shown 40 % deal value increase and 14 percent deal volume growth. Some sceptic experts already highlighted that Q1 references are insufficient – as Q1 2020 was painted in an unseen uncertainty and hard-model governmental interference whilst Q1 2021 came in much more predictable conditions with vaccination campaigns being successful and more lockdowns lightened.

The 2020 picture for the distressed part of the global (and particularly EMEA) part of M&A market is quite the same. With hundreds of companies still receiving governmental support and financial institutions still having a wide liquidity, the 2020 data from Bloomberg reports show no Big Bang in distress deals (either arising from pre-pack agreements between debtors and creditors or from formal insolvency processes), at least if compared with 2007-8 recession years.

Nevertheless Bloomberg themselves recognize that 2021 market might become red-hot. Whether this prognosis will materialize soon – here are four basic tips to hold in mind when thinking on insolvency-sed distress M&A deal on either – buyer or seller side:

  1. asset or going-concern purchase. A key business decision is understanding of whether a target business is viable enough and fits in the buyer’s existing\planned portfolio to be bought as a going-concern company. Should there be no certainty – a rule of thumb with almost always be to stick with the asset deal being more secured and the target itself much easier to allocate.
    On the other hand, for a manufacturing target license and related IP rights holding might constitute a large part of the business’ value – without which the desired asset appears to be a no-hand pot.
  1. watch for exclusivity – as asset-based distressed purchase might lack one because of the procedural obligation of going through bidding process.
  2. beware of easy ways. With so-called reverse vesting orders and free-and-clean sales an SP process might look very comfortable for a buyer eager to obtaining the target clean of any burdens (liens, mortgages, tax liabilities). Might look – but rarely be such within FSU and a part of CEE countries where a big chance of facing clawback action exists, especially with a huge state (tax\duty) interest at stake.
  3. do post-deal homework. When purchasing a going concern company it is for the newly-appointed management to be concerned the most: in a number of jurisdictions they might be boomeranged with management-liability claims resulting from previous management\shareholders cadence.
  4. have an insurance company over the seller’s back. In case any post-closing tails appear, this will give a substantial level of calmness for both sides relying on the insurance to cover a part of the purchase price or post-deal liabilities.

With the post-pandemic distress M&A yet to come and investors being ready as never, these rules will certainly be of use. As S&P 500 non-financials, in late 2020 corporate balance sheets reflected more than $2 trillion of cash – guess if there are funds for making your deal as well? Just remember: there is no one-size-fits-all approach in doing the distress deal and there always is a place for bespoke solutions given by true professionals.

In 2019 the Private Equity and Venture Capital players have invested Euro 7,223 million in 370 transactions in the Italian Market, 26% less than 2018; these are the outcomes released on March 24th by AIFI (Italian Association of Private Equity, Venture Capital e Private Debt).

In this slowing down scenario the spreading of Covid-19 is impacting Private Equity and Venture Capital transactions currently in progress, thus raising implications and alerts that will considerably affect both further capital investments and the legal approach to investments themselves.

Companies spanning a wide range of industries are concerned by Covid-19 health emergency, with diverse impacts on businesses depending on the industry. In this scenario, product companies, direct-to-consumer companies, and retail-oriented businesses appear to be more affected than service, digital, and hi-tech companies. Firms and investors will both need to batten down the hatches, as to minimize the effects of the economic contraction on the on-going investment transactions. In this scenario, investors hypothetically backing off from funding processes represent an issue of paramount concern for start-ups, as these companies are targeted by for VC and PE investments. In that event, the extent of the risk would be dependent upon the investment agreements and share purchase agreements (SPAs) entered into and the term sheets approved by the parties.

MAC/MAE clauses

The right of investors to withdrawal (way out) from a transaction is generally secured by the so-called MAC or MAE clauses – respectively, material adverse change clause or material adverse effect. These clauses, as the case may be and in the event of unforeseeable circumstances, upon the subscription of the agreements, which significantly impact the business or particular variables of the investment, allow investors to decide not to proceed to closing, not to proceed to the subscription and the payment of the share capital increase, when previously resolved, to modify/renegotiate the enterprise value, or to split the proposed investment/acquisition into multiple tranches.

These estimates, in terms of type and potential methods of application of the clauses, usually depend on a number of factors, including the governing law for the agreements – if other than Italian – with this circumstance possibly applying in the case of foreign investors imposing the existing law in their jurisdiction, as the result of their position in the negotiation.

When the enforcement of MAC/MAE clauses leads to the modification/renegotiation of the enterprise value – that is to be lowered – it is advisable to provide for specific contract terms covering calculating mechanisms allowing for smoothly redefining the start-up valuation in the venture capital deals, with the purpose of avoiding any gridlocks that would require further involvement of experts or arbitrators.

In the absence of MAC/MAE clauses and in the case of agreements governed by the Italian law, the Civil Code provides for a contractual clause called ‘supervenient burdensomeness’ (eccessiva onerosità sopravvenuta) of a specific performance (i.e. the investment), with the consequent right for the party whose performance has become excessively burdensome to terminate the contract or to make changes to the contract, with a view to fair and balanced conditions – this solution however implies an inherent degree of complexity and cannot be instantly implemented. In case of agreements governed by foreign laws, it shall be checked whether or not the applicable provisions allow the investor to exit the transaction.

Interim Period clauses

MAC/MAE are generally negotiated when the time expected to closing is medium or long. Similarly, time factors underpin the concept of the Interim Period clauses regulating the business operation in the period between signing and closing, by re-shaping the company’s ordinary scope of business, i.e. introducing maximum expenditure thresholds and providing for the prohibition to execute a variety of transactions, such as capital-related transactions, except when the investors, which shall be entitled to remove these restrictions from time to time, agree otherwise.

It is recommended to ascertain that the Interim Period clauses provide for a possibility to derogate from these restrictions, following prior authorization from the investors, and that said clauses do not require, where this possibility is lacking, for an explicit modification to the provision because of the occurrence of any operational need due to the Covid-19 emergency.

Conditions for closing

The Government actions providing for measures to contain coronavirus have caused several slowdowns that may impact on the facts or events that are considered as preliminary conditions which, when occurring, allow to proceed to closing. Types of such conditions range from authorisations to public entities (i.e. IPs jointly owned with a university), to the achievement of turnover objectives or the completion of precise milestones, that may be negatively affected by the present standstill of companies and bodies. Where these conditions were in fact jeopardised by the events triggered by the Covid-19 outbreak, this would pose important challenges to closing, except where expressly provided that the investor can renounce, with consent to proceed to the investment in all cases. This is without prejudice to the possibility of renegotiating the conditions, in agreement with all the parties.

Future investments: best practice

Covid-19 virus related emergency calls for a change in the best practice of Private Equity and Venture Capital transactions: these should carry out detailed Due diligences on aspects which so far have been under-examined.

This is particularly true for insurance policies covering cases of business interruption resulting from extraordinary and unpredictable events; health insurance plans for employees; risk management procedures in supply chain contracts, especially with foreign counterparts; procedures for smart working and relevant GDPR compliance issues in case of targeted companies based in EU and UK; contingency plans, workplace safety, also in connection with the protocols that ensure ad-hoc policies for in-house work.

Investment protection should therefore also involve MAC/MAE clauses and relevant price adjustment mechanisms, including for the negotiation of contract-related warranties (representation & warranties). A special focus shall be given now, with a different approach, to the companies’ ability to tackle and minimize the risks that may arise from unpredictable events of the same scope as Covid-19, which is now affecting privacy systems, the workforce, the management of supply chain contracts, and the creditworthiness of financing agreements.

This emergency will lead investors to value the investments with even greater attention to information, other than financial ones, about targeted companies.

Indeed, it is mandatory today to gain overview on the resilience of businesses, in terms of structure and capability, when these are challenged by the exogenous variables of the market on the one side, and by the endogenous variables on the other side – to be now understood as part of the global economy.

There is however good news: Venture Capital and Private Equity, like any other ecosystem, will have its own response capacity and manage to gain momentum, as it happened in 2019 when Italy witnessed an unprecedented increase in investments. The relevant stakeholders are already developing coping strategies. Transactions currently in progress are not halted – though slowed down. Indeed, the quarantine does not preclude negotiations or shareholders’ meetings, which are held remotely or by videoconference. This also helps dispel the notion that meetings can only be conducted by getting the parties concerned round the same table.

The author of this post is Milena Prisco.

The COVID-19 pandemic’s dramatic disruption of the legal and business landscape has included a steep drop in overall M&A activity in Q1 2020.  Much of this decrease has been due to decreased target valuations, tighter access by buyers to liquidity, and perhaps above all underlying uncertainty as to the crisis’s duration.

For pending transactions, whether the buyer can walk away from the deal (or seek a purchase price reduction) by invoking a material adverse change (MAC) or material adverse effect (MAE) clause – or another clause in the purchase agreement – due to COVID-19 has become a question of increasing relevance.  MAC/MAE clauses typically allow a buyer to terminate an acquisition agreement if a MAC or MAE occurs between signing and closing.

Actual litigated cases in this area have been few and far between, as under longstanding Delaware case law[1], buyer has the burden of proving MAC or MAE, irrespective of who initiates the lawsuit.  And the standard of proof is high – a buyer must show that the effects of the intervening event are sufficiently large and long lasting as compared to an equivalent period of the prior year.  A short-term or immaterial deviation will not suffice.  In fact, Delaware courts have only once found a MAC, in the December 2018 case Akorn, Inc. v. Fresenius Kabi AG.

And yet, since the onset of the COVID-19 pandemic, numerous widely reported COVID-19 related M&A litigations have been initiated with the Delaware Court of Chancery.  These include:

  • Bed, Bath & Beyond suing 1-800-Flowers (Del. Ch. April 1, 2020) to complete its acquisition of Perosnalizationmall.com (purchaser sought an extension in closing, without citing specifically the contractual basis for the request);
  • Level 4 Yoga, franchisee of CorePower Yoga, suing CorePower Yoga (Del. Ch. Apr 2, 2020) to compel CorePower Yoga to purchase of Level 4 Yoga studios (after CorePower Yoga took the position that studio closings resulting from COVID-19 stay-at-home orders violated the ordinary course covenant);
  • Oberman, Tivoli & Pickert suing Cast & Crew (Del. Ch. Apr 6, 2020), an industry competitor, to complete its purchase of Oberman’s subsidiary (Cast & Crew maintained it was not obligated to close based on alleged insufficiencies in financial data provided in diligence);
  • SP VS Buyer LP v. L Brands, Inc. (Del. Ch. Apr 22, 2020), in which buyer sought a declaratory judgment in its favor on termination); and
  • L Brands, Inc. v. SP VS Buyer L.P., Sycamore Partners III, L.P., and Sycamore Partners III-A, L.P (Del. Ch. Apr 23), in which seller instead seeks declaratory judgment in its favor on buyer obligation to close.

Such cases, typically signed up at an early stage of the pandemic, are likely to increase.  Delaware M&A-MAC-related jurisprudence suggests that buyers seeking to cite MAC in asserting their positions should expect an uphill fight, given buyer’s high burden of proof.  Indeed, Delaware courts’ sole finding of a MAC in Akorn was based on rather extreme facts: target’s (Akorn’s) business deteriorated significantly (40% and 20% drops in profit and equity value, respectively), measured over a full year.  And quite material to the Court’s decision was the likely devastating effect on Akorn’s business resulting from Akorn’s deceptive conduct vis-à-vis the FDA.

By contrast, cases before and after Akorn, courts have not found a MAC/MAE, including in the 2019 case Channel Medsystems, Inc. v. Bos. Sci. Corp.  There, Boston Scientific Corporation (BSC) agreed to purchase Channel Medsystems, Inc., an early stage medical device company.  The sale was conditioned on Channel receiving FDA approval for its sole product, Cerene. In late December 2017, Channel discovered that falsified information from reports by its Vice President of Quality (as part of a scheme to steal over $2 million from Channel) was included in Channel’s FDA submissions.  BSC terminated the merger agreement in May 2018, asserting that Channel’s false representations and warranties constituted a MAC.

The court disagreed.  While Channel and Akron both involved a fraud element, Chanel successfully resubmitted its FDA application, such that the fraudulent behavior – the court found – would not cause the FDA to reject the Cerene device.  BSC also failed to show sufficiently large or long-lasting effects on Channel’s financial position.  Channel thus reaffirmed the high bar under pre-Akron Delaware jurisprudence for courts to find a MAC/MAE (See e.g. In re IBP, Inc. S’holders Litig., 789 A.2d 14 (Del. Ch. 2001); Frontier Oil Corp. v. Holly Corp., 2005 WL 1039027 (Del. Ch. Apr. 29, 2005); Hexion Specialty Chemicals v. Huntsman Corp., 965 A.2d 715 (Del. Ch. 2008)).

Applied to COVID-19, buyers may have challenges in invoking MAC/MAE clauses under their purchase agreements.

First, it may simply be premature at this juncture for a buyer to show the type of longer-term effects that have been required under Delaware jurisprudence.  The long-term effects of COVID-19 itself are unclear.  Of course, as weeks turn into months and longer, this may change.

A second challenge is certain carve-outs typically included in MAC/MAE clauses.  Notably, it is typical for these clauses to include exceptions for general economic and financial conditions generally affecting a target’s industry, unless a buyer can demonstrate that they have disproportionately affected the target.

A buyer may be able to point to other clauses in a purchase agreement in seeking to walk away from the deal.  Of note is the ordinary course covenant that applies to the period between signing and closing.  By definition, most targets are unable to carry out business during the COVID-19 crisis consistent with past practice.  It is unclear whether courts will allow for a literal reading of these clauses, or interpret them taking into account the broader risk allocation regime as evidenced by the MAC or MAE clause in the agreement, and in doing so reject a buyer’s position.

For unsigned deals, there may be some early lessons for practitioners as they prepare draft purchase agreements.  On buyer walk-away rights, buyers will want to ensure that the MAE/MAC definition includes express reference to “pandemics” and “epidemics”, if not to “COVID-19” itself.  Conversely, Sellers may wish to seek to loosen ordinary course covenant language, such as by including express exceptions for actions required by the MAC or MAE and otherwise ensure that they comply with all obligations under their control.  Buyers will also want to pay close attention to how COVID-19 affects other aspects of the purchase agreement, including seeking more robust representations and warranties on the impact of COVID-19 on the target’s business.

 

[1] Although the discussion of this based Delaware law, caselaw in other U.S. jurisdictions often is consistent Delaware.  

This week the Interim Injunction Judge of the Netherlands Commercial Court ruled in summary proceedings, following a video hearing, in a case on a EUR 169 million transaction where the plaintiff argued that the final transaction had been concluded and the defendant should proceed with the deal.

This in an – intended – transaction where the letter of intent stipulates that a EUR 30 million break fee is due when no final agreement is signed.

In addition to ruling on this question of construction of an agreement under Dutch law, the judge also had to rule on the break fee if no agreement was concluded and whether it should be amended or reduced because of the current Coronavirus / Covid-19 crisis.

English Language proceedings in a Dutch state court, the Netherlands Commercial Court (NCC)

The case is not just interesting because of the way contract formation is construed under Dutch law and application of concepts of force majeure, unforeseen circumstances and amendment of agreements under the concepts of reasonableness and fairness as well as mitigation of contractual penalties, but also interesting because it was ruled on by a judge of the English language chamber of the Netherlands Commercial Court (NCC).

This new (2019) Dutch state court offers a relatively fast and cost-effective alternative for international commercial litigation, and in particular arbitration, in a neutral jurisdiction with professional judges selected for both their experience in international disputes and their command of English.

The dispute regarding the construction of an M&A agreement under Dutch law in an international setting

The facts are straightforward. Parties (located in New York, USA and the Netherlands) dispute whether final agreement on the EUR 169 million transaction has been reached but do agree a break fee of €30 million in case of non-signature of the final agreement was agreed. However, in addition to claiming there is no final agreement, the defendant also argues that the break fee – due when there is no final agreement – should be reduced or changed due to the coronavirus crisis.

As to contract formation it must be noted that Dutch law allows broad leeway on how to communicate what may or may not be an offer or acceptance. The standard is what a reasonable person in the same circumstances would have understood their communications to mean.  Here, the critical fact is that the defendant did not sign the so-called “Transaction Agreement”. The letter of intent’s binary mechanism (either execute and deliver the paperwork for the Transaction Agreement by the agreed date or pay a EUR 30 million fee) may not have been an absolute requirement for contract formation (under Dutch law) but has significant evidentiary weight. In M&A practice – also under Dutch law – with which these parties are thoroughly familiar with, this sets a very high bar for  concluding a contract was agreed other than by explicit written agreement. So, parties may generally comfortably rely on what they have agreed on in writing with the assistance of their advisors.

The communications relied on by claimant in this case did not clear the very high bar to assume that despite the mechanism of the letter of intent and the lack of a signed Transaction Agreement there still was a binding agreement. In particular attributing the other party’s advisers’ statements and/or conduct to the contracting party they represent did not work for the claimant in this case as per the verdict nothing suggested that the advisers would be handling everything, including entering into the agreement.

Court order for actual performance of a – deemed – agreement on an M&A deal?

The Interim Injunction Judge finds that there is not a sufficient likelihood of success on the merits so as to justify an interim measure ordering the defendant to actually perform its obligations under the disputed Transaction Agreement (payment of EUR 169 million and take the claimant’s 50% stake in an equestrian show-jumping business).

Enforcement of the break fee despite “Coronavirus”?

Failing the conclusion of an agreement, there was still another question to answer as the letter of intent mechanism re the break fee as such was not disputed. Should the Court enforce the full EUR 30 million fee in the current COVID-19 circumstances? Or should the fee’s effects be modified, mitigated or reduced in some way, or  the fee agreement should even be dissolved?

Unforeseen circumstances, reasonableness and fairness

The Interim Injunction Judge rules that the coronavirus crisis may be an unforeseen circumstance, but it is not of such a nature that, according to standards of reasonableness and fairness, the plaintiff cannot expect the break fee obligation to remain unchanged. The purpose of the break fee is to encourage parties to enter into the transaction and attribute / share risks between them. As such the fee limits the exposure of the parties. Payment of the fee is a quick way out of the obligation to pay the purchase price of EUR 169 million and the risks of keeping the target company financially afloat. If financially the coronavirus crisis turns out less disastrous than expected, the fee of EUR 30 million may seem high, but that is what the parties already considered reasonable when they waived their right to invoke the unreasonableness of the fee. The claim for payment of the EUR 30 million break fee is therefore upheld by the Interim Injunction Judge.

Applicable law and the actual practice of it by the courts

The relevant three articles are in this case articles 6:94, 6:248 and 6:258 of the Dutch Civil Code. They relate to the mitigation of contractual penalties, unforeseen circumstances and amendment of the agreement under the tenets of reasonableness and fairness. Under Dutch law the courts must with all three exercise caution. Contracts must generally be enforced as agreed. The parties’ autonomy is deemed paramount and the courts’ attitude is deferential. All three articles use language stating, essentially, that interference by the courts in the contract’s operation is allowed only to avoid an “unacceptable” impact, as assessed under standards of reasonableness and fairness.

There is at this moment of course no well- established case law on COVID-19. However, commentators have provided guidance that is very helpful to think through the issues. Recently a “share the pain” approach has been advocated by a renowned law Professor, Tjittes, who focuses on preserving the parties’ contractual equilibrium in the current circumstances. This is, in the Court’s analysis, the right way to look at the agreement here. There is no evidence in the record suggesting that the parties contemplated or discussed the full and exceptional impact of the COVID-19 crisis. The crisis may or may not be unprovided for.  However, the court rules in the current case there is no need to rule on this issue. Even if the crisis is unprovided for, there is no support in the record for the proposition that the crisis makes it unacceptable for the claimant to demand strict performance by the defendant. The reasons are straightforward.

The break fee allocates risk and expresses commitment and caps exposure. The harm to the business may be substantial and structural, or it may be short-term and minimal. Either way, the best “share the pain” solution, to preserve the contractual equilibrium in the agreement, is for the defendant to pay the fee as written in the letter of intent. This allocates a defined risk to one party, and actual or potential risks to the other party. Reducing the break fee in any business downturn, the fee’s express purpose – comfort and confidence to get the deal done – would not be accomplished and be derived in precisely the circumstances in which it should be robust. As a result, the Court therefore orders to pay the full EUR 30 million fee. So the break fee stipulation works under the circumstances without mitigation because of the Corona outbreak.

The Netherlands Commercial Court, continued

As already indicated above, the case is interesting because the verdict has been rendered by a Dutch state court in English and the proceedings where also in English. Not because of a special privilege granted in a specific case but based on an agreement between parties with a proper choice of forum clause for this court. In addition to the benefit to of having an English forum without mandatorily relying on either arbitration or choosing an anglophone court, it also has the benefit of it being a state court with the application of the regular Dutch civil procedure law, which is well known by it’s practitioners and reduces the risk of surprises of a procedural nature.  As it is as such also a “normal” state court, there is the right to appeal and particularly effective under Dutch law access to expedited proceeding as was also the case in the example referred to above. This means a regular procedure with full application of all evidentiary rules may still follow, overturning or confirming this preliminary verdict in summary proceedings.

Novel technology in proceedings

Another first or at least a novel application is that all submissions were made in eNCC, a document upload procedure for the NCC. Where the introduction of electronic communication and litigation in the Dutch court system has failed spectacularly, the innovations are now all following in quick order and quite effective. As a consequence of the Coronavirus outbreak several steps have been quickly tried in practice and thereafter formally set up. At present this – finally – includes a secure email-correspondence system between attorneys and the courts.

And, also by special order of the Court in this present case, given the current COVID-19 restrictions the matter was dealt with at a public videoconference hearing on 22 April 2020 and the case was set for judgment on 29 April 2020 and published on 30 April 2020.

Even though it is a novel application, it is highly likely that similar arrangements will continue even after expiry of current emergency measures. In several Dutch courts videoconference hearings are applied on a voluntary basis and is expected that the arrangements will be formalized.

Eligibility of cases for the Netherlands Commercial Court

Of more general interest are the requirements for matters that may be submitted to NCC:

  • the Amsterdam District Court or Amsterdam Court of Appeal has jurisdiction
  • the parties have expressly agreed in writing that proceedings will be in English before the NCC (the ‘NCC agreement’)
  • the action is a civil or commercial matter within the parties’ autonomy
  • the matter concerns an international dispute.

The NCC agreement can be recorded in a clause, either before or after the dispute arises. The Court even recommends specific wording:

“All disputes arising out of or in connection with this agreement will be resolved by the Amsterdam District Court following proceedings in English before the Chamber for International Commercial Matters (“Netherlands Commercial Court” or “NCC District Court”), to the exclusion of the jurisdiction of any other courts. An action for interim measures, including protective measures, available under Dutch law may be brought in the NCC’s Court in Summary Proceedings (CSP) in proceedings in English. Any appeals against NCC or CSP judgments will be submitted to the Amsterdam Court of Appeal’s Chamber for International Commercial Matters (“Netherlands Commercial Court of Appeal” or “NCCA”).”

The phrase “to the exclusion of the jurisdiction of any other courts” is included in light of the Hague Convention on Choice of Court Agreements. It is not mandatory to include it of course and parties may decide not to exclude the jurisdiction of other courts or make other arrangements they consider appropriate. The only requirement being that such arrangements comply with the rules of jurisdiction and contract. Please note that choice of court agreements are exclusive unless the parties have “expressly provided” or “agreed” otherwise (as per the Hague Convention and Recast Brussels I Regulation).

Parties in a pending case before another Dutch court or chamber may request that their case be referred to NCC District Court or NCC Court of Appeal. One of the requirements is to agree on a clause that takes the case to the NCC and makes English the language of the proceedings. The NCC recommends using this language:

We hereby agree that all disputes in connection with the case [name parties], which is currently pending at the *** District Court (case number ***), will be resolved by the Amsterdam District Court following proceedings in English before the Chamber for International Commercial Matters (“Netherlands Commercial Court” or ”NCC District Court). Any action for interim measures, including protective measures, available under Dutch law will be brought in the NCC’s Court in Summary Proceedings (CSP) in proceedings in English. Any appeals against NCC or CSP judgments will be submitted to the Amsterdam Court of Appeal’s Chamber for International Commercial Matters (“Netherlands Commercial Court of Appeal” or “NCC Court of Appeal”).

To request a referral, a motion must be made before the other chamber or court where the action is pending, stating the request and contesting jurisdiction (if the case is not in Amsterdam) on the basis of a choice-of-court agreement (see before).

Additional arrangements in the proceedings before the Netherlands Commercial Court

Before or during the proceedings, parties can also agree special arrangements in a customized NCC clause or in another appropriate manner. Such arrangements may include matters such as the following:

  • the law applicable to the substantive dispute
  • the appointment of a court reporter for preparing records of hearings and the costs of preparing those records
  • an agreement on evidence that departs from the general rules
  • the disclosure of confidential documents
  • the submission of a written witness statement prior to the witness examination
  • the manner of taking witness testimony
  • the costs of the proceedings.

Visiting lawyers and typical course of the procedure

All acts of process are in principle carried out by a member of the Dutch Bar. Member of the Bar in an EU or EEA Member State or Switzerland may work in accordance with Article 16e of the Advocates Act (in conjunction with a member of the Dutch Bar). Other visiting lawyers may be allowed to speak at any hearing.

The proceedings will typically follow the below steps:

  • Submitting the initiating document by the plaintiff (summons or request as per Dutch law)
  • Assigned to three judges and a senior law clerk.
  • The defendant submits its defence statement.
  • Case management conference or motion hearing (e.g. also in respect of preliminary issues such as competence, applicable law etc.) where parties may present their arguments.
  • Judgment on motions: the court rules on the motions. Testimony, expert appointment, either at this stage or earlier or later.
  • The court may allow the parties to submit further written statements.
  • Hearing: the court interviews the parties and allows them to present their arguments. The court may enquire whether the dispute could be resolved amicably and, where appropriate, assist the parties in a settlement process. If appropriate, the court may discuss with the parties whether it would be advisable to submit part or all of the dispute to a mediator. At the end of the hearing, the court will discuss with the parties what the next steps should be.
  • Verdict: this may be a final judgment on the claims or an interim judgment ordering one or more parties to produce evidence, allowing the parties to submit written submissions on certain aspects of the case, appointing one or more experts or taking other steps.

Continuous updates, online resources Netherlands Commercial Court

As a final note the English language website of the Netherlands Commercial Court provides ample information on procedure and practical issues and is updated with a high frequence. Under current circumstance even at a higher pace. In particular for practitioners it’s recommended to regularly consult the website. https://www.rechtspraak.nl/English/NCC/Pages/default.aspx

Le operazioni di acquisizione (M&A) in Italia, nella maggior parte dei casi, vengono realizzate attraverso acquisto di partecipazioni (‘share deal’) o di azienda o ramo d’azienda (‘asset deal’). Per ragioni principalmente fiscali sono più frequenti gli share deal rispetto agli asset deal, nonostante l’asset deal consenta una migliore limitazione dei rischi per l’acquirente. Vedremo le principali differenze tra share deal e asset deal in termini di rischi e di rapporti tra venditore e acquirente.

Preferenza per operazioni di M&A mediante acquisto di partecipazioni (‘share deal’) rispetto ad acquisto di azienda o ramo d’azienda (‘asset deal’) nel mercato italiano

In Italia, le operazione di acquisizione (M&A) vengono realizzate, nella maggior parte dei casi, attraverso acquisto di partecipazioni (‘share deal’) o di azienda o ramo d’azienda (‘asset deal’). Altre modalità, come la fusione, sono meno frequenti.

Con l’acquisto di quote o azioni della società acquisita (‘share deal’) l’acquirente acquisisce, indirettamente, l’intero patrimonio aziendale (attività, passività, rapporti) e quindi si fa carico di tutti i rischi relativi alla precedente gestione della società.

Con l’acquisto dell’azienda o di un ramo d’azienda (‘asset deal’) l’acquirente acquisisce un insieme di beni e rapporti organizzati per l’esercizio dell’impresa (immobili, impianti, dipendenti, contratti, crediti, debiti, ecc.). Il vantaggio dell’asset deal risiede nella possibilità per le parti di definire il perimetro del trasferimento e, quindi, per l’acquirente, di limitare i rischi legali dell’operazione.

Nonostante questo vantaggio, la maggior parte delle operazioni di acquisizione in Italia avviene attraverso acquisto di partecipazioni. Nel 2018 gli acquisti di partecipazioni (azioni o quote) sono state circa 78.400, mentre le cessioni di azienda sono state circa 35.900 (fonte: www.notariato.it/it/news/dati-statistici-notarili-anno-2018). E va osservato che il dato delle cessioni d’azienda comprende anche le aziende di piccole o piccolissime dimensioni esercitate da imprenditori individuali, per le quali l’alternativa dello share deal (pur praticabile, attraverso il conferimento dell’azienda in una newco e la cessione delle partecipazioni nella newco) non è percorribile in concreto per ragioni di costo.

Costi fiscali delle operazioni di acquisizione (M&A) in Italia

La principale ragione della preferenza per l’acquisto di partecipazione (‘share deal’) rispetto all’acquisto di azienda (‘asset deal’) risiede nei costi fiscali dell’operazione. Vediamo quali sono, in linea generale.

Nell’acquisto di partecipazioni, le imposte dirette a carico del venditore vengono calcolate sulla plusvalenza, secondo le seguenti percentuali:

  • se il venditore è una società di capitali (s.p.a.; s.r.l.; s.a.p.a.) l’aliquota è del 24% della plusvalenza. Ma, a determinate condizioni, si applica il regime della c.d. PEX (participation exemption) con applicazione dell’aliquota del 24% solo sul 5% della plusvalenza.
  • Se il venditore è una persona fisica l’aliquota sulla plusvalenza è del 26%.
  • Se il venditore è una società di persone (s.s.; s.n.c..; s.a.s.) la plusvalenza è integralmente imponibile, tuttavia al ricorrere di determinate condizioni, l’imponibilità è limitata al 60% dell’ammontare della plusvalenza. In entrambi i casi l’aliquota applicabile è quella marginale riferita a ciascun socio a cui il reddito viene imputato per trasparenza.

Nell’acquisto di partecipazioni si applica l’imposta di registro, normalmente a carico dell’acquirente, di euro 200.

Anche nell’acquisto di azienda, le imposte dirette a carico del venditore vengono calcolate sulla plusvalenza. Se il venditore è una società di capitali, l’aliquota è del 24% della plusvalenza. Se il venditore è una società di persone (con soci persone fisiche) o un imprenditore individuale, le aliquote dipendono dal reddito del venditore.

Nell’acquisto di azienda si applicano le imposte indirette, normalmente a carico dell’acquirente, calcolate sulla parte del prezzo attribuibile ai singoli beni trasferiti. Il prezzo è il risultato delle attività trasferite detratte le passività trasferite. Le percentuali sono diverse a seconda del tipo di beni. In generale:

  • ai beni mobili si applica una imposta di registro del 3%;
  • all’avviamento si applica una imposta di registro del 3%;
  • ai fabbricati si applica una imposta di registro del 9% (e imposte ipotecarie e catastali in misura fissa di euro 50 ciascuna);
  • ai terreni si applica una imposta di registro tra il 9 e il 12% (a seconda dell’acquirente) e imposte ipotecarie e catastali in misura fissa di euro 50 ciascuna.

Nel caso in cui l’azienda sia composta da beni soggetti ad aliquote diverse e le parti abbiano pattuito un corrispettivo unico, senza distinzione in merito al valore attribuibile ai singoli beni, l’imposta deve calcolarsi applicando all’unico corrispettivo pattuito l’aliquota più elevata.

Va sottolineato che l’Agenzia delle Entrate può sottoporre ad accertamento il valore attribuito dalle parti ai beni immobili e all’avviamento, con conseguente rischio di applicazione di maggiori imposte.

Share deal e asset deal: rischi e responsabilità verso i terzi

Nell’acquisto di quote o azioni (‘share deal’) l’acquirente si fa carico, indirettamente, di tutti i rischi relativi alla precedente gestione della società.

Nell’acquisto dell’azienda o di un ramo d’azienda (‘asset deal’), invece, le parti possono decidere il perimetro del trasferimento (quali beni e rapporti) così stabilendo, nei rapporti tra loro, i rischi che l’acquirente assume.

Vi sono però alcune norme, che le parti non possono derogare, relative ai rapporti con i terzi, che influiscono significativamente sui rischi per il venditore e l’acquirente e quindi sulla negoziazione dell’accordo tra le parti. Le principali sono le seguenti.

  • Lavoratori dipendenti: il rapporto di lavoro continua con l’acquirente dell’azienda. Il venditore e l’acquirente sono obbligati in solido per tutti i crediti del lavoratore al momento del trasferimento (art. 2112 c.c.).
  • Debiti: il venditore è obbligato al pagamento di tutti i debiti sino alla data del trasferimento. L’acquirente è obbligato per i debiti che risultano dai libri contabili (art. 2560 c.c.).
  • Debiti e responsabilità fiscali: il venditore è obbligato al pagamento di debiti, imposte e sanzioni fiscali relative al periodo sino alla data del trasferimento.
    L’acquirente, in aggiunta all’obbligo relativo ai debiti fiscali che risultano dai libri contabili (art. 2560 c.c.), è responsabile per le imposte e sanzioni, anche se non risultano dai libri contabili, con i seguenti limiti (art. 14 D.lgs. 472/1997):
  • beneficio della preventiva escussione del venditore;
  • fino al valore dell’azienda o del ramo d’azienda acquistato;
  • per le imposte e sanzioni non ancora contestate, la responsabilità riguarda solo quelle relative all’anno della vendita dell’azienda e ai due precedenti; per le imposte e sanzioni relative al periodo anteriore ai due anni precedenti la vendita dell’azienda, la responsabilità riguarda solo quelle contestate entro tale periodo;
  • nei limiti del debito risultante alla data di trasferimento dagli atti degli uffici dell’amministrazione finanziaria. L’Agenzia delle Entrate è tenuta a rilasciare un certificato sull’esistenza di contestazioni in corso e sui debiti. Il certificato negativo, o non rilasciato entro 40 giorni dalla richiesta, libera l’acquirente da responsabilità.
  • Contratti: le parti possono scegliere quali contratti trasferire. Rispetto ai contratti trasferiti, l’acquirente subentra, anche senza il consenso del terzo contraente, nei contratti per l’esercizio dell’azienda che non hanno carattere personale (sono a carattere personale quelli che prevedono da parte del venditore una prestazione oggettivamente infungibile o soggettivamente infungibile). Inoltre il terzo contraente può recedere dal contratto entro tre mesi, se sussiste una giusta causa (ad esempio se l’acquirente non garantisce, per la propria situazione patrimoniale o per capacità tecniche, di poter adempiere al contratto) (art. 2558 c.c.).

Alcuni strumenti per affrontare i rischi

Per affrontare i rischi derivanti dalle responsabilità verso i terzi e i rischi generali connessi all’acquisizione, vi sono diversi strumenti negoziali e contrattuali che possono essere utilizzati. Vediamone alcuni.

Nelle operazioni di acquisto dell’azienda o di rami d’azienda (‘asset deal’):

  • Lavoratori dipendenti: è possibile concordare con il lavoratore modifiche alle condizioni contrattuali e rinunce alla responsabilità solidale dell’acquirente e del venditore (ex art. 2112 c.c.). L’accordo con i lavoratore per essere valido deve essere concluso in sede ‘protetta’ (ad esempio: con l’assistenza delle organizzazioni sindacali).
  • Debiti:
  • trasferire all’acquirente i debiti riducendo il prezzo in misura corrispondente; la riduzione del prezzo comporta, inoltre, una minor costo fiscale dell’operazione. In caso di trasferimento dei debiti, per tutelare il venditore si può ottenere dal creditore una dichiarazione di liberazione del venditore dalla responsabilità ex art. 2560 c.c.; oppure si può prevedere che il pagamento del debito da parte dell’acquirente avvenga contestualmente al trasferimento dell’azienda (‘closing’).
  • Per i debiti non trasferiti all’acquirente, ottenere dal creditore una dichiarazione di liberazione dell’acquirente dalla responsabilità ex art. 2560 c.c.
  • Per i debiti per i quali non sia possibile ottenere la dichiarazione di liberazione da parte del creditore, pattuire forme di garanzia a favore del venditore (per i debiti trasferiti) o a favore dell’acquirente (per i debiti non trasferiti), quali ad esempio la dilazione del pagamento (a favore dell’acquirente) di parte del prezzo, il deposito fiduciario (‘escrow’) di parte del prezzo, fideiussioni bancarie o da parte dei soci.
  • Debiti e responsabilità fiscali:
  • ottenere dall’Agenzia delle Entrate il certificato ex art. 14 D.lgs. 472/1997 sui debiti e le contestazioni in corso;
  • trasferire all’acquirente i debiti riducendo il prezzo in misura corrispondente;
  • pattuire le forme di garanzia a favore del venditore (per i debiti trasferiti) e a favore dell’acquirente (per i debiti non trasferiti o per le contestazioni che non sono ancora debiti), quali ad esempio quelle sopra esposte per i debiti in generale.
  • Contratti: per quelli che vengono trasferiti:
  • verificare che le prestazioni a carico del venditore sino alla data del trasferimento siano state regolarmente adempiute, per evitare il rischio di contestazioni del terzo contraente che possono bloccare l’esecuzione del contratto;
  • almeno per i contratti più importanti (e salvo ragioni di riservatezza), cercare di ottenere conferma dal terzo contraente del benestare al trasferimento del contratto.

Nelle operazioni di acquisto di partecipazioni (‘share deal’), in cui l’acquirente si fa carico, indirettamente, di tutti i rischi relativi alla precedente gestione della società, alcuni strumenti sono:

  • Due diligence. Svolgere una approfondita due diligence legale, fiscale e contabile sulla società, per valutare preventivamente i rischi e gestirli nella trattativa e nei contratti.
  • Dichiarazioni e garanzie (‘R&W’) e indennizzo. Prevedere nel contratto di acquisizione (‘share purchase agreement’) un set dettagliato di dichiarazioni e garanzie – e obblighi di indennizzo in caso di non conformità – a carico del venditore relativamente alla situazione della società (‘business warranties’: bilancio; situazione patrimoniale di riferimento; contratti; contenzioso; rispetto della normativa ambientale; autorizzazioni per lo svolgimento dell’attività; debiti; crediti ecc.). La trattativa sulle dichiarazioni e garanzie normalmente recepisce, gestendoli, gli esiti della due diligence (ad esempio: viene escluso dalle dichiarazioni e garanzie e dall’indennizzo un contenzioso emerso in due diligence, del quale le parti tengono conto nella definizione del prezzo). La pattuizione di dichiarazioni e garanzie sulla situazione della società (‘business warranties’) e dell’obbligo di indennizzo sono necessari negli share deal in Italia, in quanto in mancanza di tali clausole l’acquirente non può ottenere dal venditore (salvo situazioni estreme e molto rare) un risarcimento o indennizzo in caso la situazione della società sia diversa da quella considerata al momento dell’acquisto (così ad esempio: Cass. Civ. 16963/2014).
  • Garanzie per l’acquirente. Strumenti per garantire all’acquirente l’effettiva possibilità di ottenere l’indennizzo (o parte dell’indennizzo) in caso di non conformità delle dichiarazioni e garanzie. Tra queste: (a) la dilazione del pagamento di parte del prezzo; (b) il versamento di parte del prezzo in un deposito fiduciario (‘escrow’) per la durata delle dichiarazioni e garanzie e, in caso di contestazioni, fino a che la contestazione non è definita; (c) fideiussione bancaria;; (d) polizza W&I, contratto di assicurazione che copre il rischio dell’acquirente in caso di violazioni di dichiarazioni e garanzie, sino ad un importo massimo (ed esclusi alcuni rischi).

Altri fattori che incidono sulla scelta tra share deal e asset deal

Naturalmente la scelta di realizzare un’operazione di acquisizione in Italia mediante share deal o asset deal, dipende anche da altri fattori oltre a quello dei costi fiscali dell’operazione. Eccone alcuni.

  • Acquisto di parte del business. Si sceglie l’asset deal, quando l’operazione non riguarda l’acquisto dell’intera azienda del venditore ma solo una sua parte (un ramo d’azienda).
  • Situazione della società problematica. Si sceglie l’asset deal quando la situazione della società target è così problematica che l’acquirente non è disponibile ad assumere tutti i rischi derivanti dalla precedente gestione, ma solo parte di essi.
  • Mantenimento di un ruolo da parte del venditore. Si sceglie lo share deal quando si vuole conservare al venditore un ruolo nella società acquisita. In questo caso, oltre ad un ruolo nel management, è frequente il mantenimento da parte del venditore di una partecipazione di minoranza, con clausole di exit (diritti di put e call) decorso un certo periodo di tempo. Clausole che, spesso, legano il prezzo ai risultati futuri e, quindi, nell’interesse dell’acquirente incentivano il venditore nel ruolo manageriale e, nell’interesse del venditore, valorizzano prospettive reddituali non concretizzate al momento dell’acquisto.

Dal 1° agosto 2021 non sarà più necessario, per la costituzione di una SRL – società a responsabilità limitata, recarsi dal notaio: la procedura potrà anche essere realizzata completamente on line, salvo casi eccezionali. Ciò è previsto dalla Direttiva U.E. 2019/1151, che impone agli stati di adeguarsi entro due anni. Vediamo cosa prevede la Direttiva.

Come si costituisce una S.r.l. in Italia oggi

In Italia, per costituire una società e, in particolare, una società a responsabilità limitata, è sempre necessario rivolgersi ad un notaio.

Ciò vale anche per la c.d. «SRL semplificata», introdotta nel 2012 dal Decreto Legge «Liberalizzazioni». In questo caso, infatti, la legge prevede che, a fronte dell’utilizzo di uno statuto standard non modificabile, non vi siano oneri notarili da sostenere. Tuttavia, resta sempre necessario comparire avanti ad un notaio.

Cosa cambierà da agosto 2021 con il recepimento della Direttiva U.E. 2019/1151

Le cose dovranno cambiare con l’entrata in vigore della Direttiva U.E. 2019/1151, che modifica la Direttiva U.E. 2017/1132 in tema di uso di strumenti e processi digitali nel diritto societario.

Entro il 1° agosto 2021, gli Stati membri dovranno aggiornare le procedure per la costituzione di una società in modo da garantire un doppio binario.

Dovrà, cioè, essere possibile costituire una società sia con il metodo tradizionale, ossia rivolgendosi ad un notaio, oppure con procedure esclusivamente on line.

Due eccezioni

  • l’art. 13-ter, par. 4, dispone che «ove sia giustificato da motivi di interesse pubblico per impedire l’usurpazione o l’alterazione di identità, gli Stati membri possono adottare misure che potrebbero richiedere la presenza fisica ai fini della verifica dell’identità del richiedente dinanzi a un’autorità o a qualsiasi persona od organismo incaricati… Gli Stati membri provvedono affinché la presenza fisica del richiedente possa essere richiesta solo se vi sono motivi di sospettare una falsificazione dell’identità e garantiscono che qualsiasi altra fase della procedura possa essere completata online»;
  • l’art. 13-octies, co. 8, dispone che «ove giustificato da motivi di interesse pubblici a garantire il rispetto delle norme sulla capacità giuridica e sull’autorità dei richiedenti di rappresentare una società, qualsiasi autorità o qualsiasi persona od organismo incaricato… può chiedere la presenza fisica del richiedente… Gli Stati membri garantiscono che tutte le altre fasi della procedura possano essere comunque completate on line».

Gli Stati membri dovranno mettere a disposizione i modelli necessari per la costituzione delle società a responsabilità limitata «in almeno una lingua ufficiale dell’Unione ampiamente compresa dal maggior numero possibile di utenti transfrontalieri».

Rischi

La direttiva rappresenta, indubbiamente, un interessante tentativo di semplificazione, il cui successo dipenderà, tuttavia, da come verrà recepita dai singoli Stati membri.

I rischi principali sono almeno due:

  1. il primo, facilmente intuibile, è che gli Stati membri rendano troppo oneroso l’accertamento dell’identità od il potere rappresentativo dei richiedenti, rendendo più semplice, in definitiva, il tradizionale ricorso ad un notaio;
  2. il secondo è che le procedure on line siano poco chiare o comprensibili, specie agli utenti stranieri. In tal senso, non appare sufficiente che i modelli siano resi disponibili, ma sarà necessario che le procedure online siano orientate alla maggiore semplificazione possibile e che i modelli siano tutti disponibili almeno in lingua inglese.

Infine, è evidente che la digitalizzazione del procedimento di costituzione di una società non elimina l’opportunità di rivolgersi ad un professionista con il compito di consigliare il cliente nelle scelte che sarà necessario fare, ad esempio in materia di corporate governance.

A legal due diligence of a Brazilian target company should analyze the existence and the content of Agency Agreements, including values paid to the agent and the nature of such payments and the factual situation of the target’s agents, in order to evaluate potential contingencies.

One usual suspect in legal due diligences of Brazilian target companies in M&A transactions that should not be overlooked is the existence of agency agreements, due to:

  • the obligation to indemnify the agent stipulated by law: at least 1/12th of all commissions paid throughout the entire term of the agency agreement; and
  • the risks for the agency being disregarded and considered as an employment relationship, subjecting the principal to compensate the agent as an employee with all rights, benefits, taxes and social contributions.

This should be considered for evaluation of potential contingencies and the impacts on the valuation of the target.

No doubt that agents can be an important component of the sales force of the business and can be strategic for the activity of the principal, in view of a certain independence and for not increasing the payroll of a company.

On the other hand, under Brazilian laws, the protective nature of the agency demands the principal a considerable level of attention.

Indemnification

Brazilian Federal Law No. 4,886/65 as amended – the Brazilian Agency Law – determines that the agent is entitled to, at the termination of an agency agreement, receive an indemnification of 1/12th calculated over all the commissions paid throughout the duration of the entire period of the agency agreement.

The Brazilian Agency Law stipulates that if the parties sign a new contract within 6 months after the expiration of the previous, the relation between agent and principal shall be deemed as the same relationship and thus, the duration to calculate the indemnification shall encompass the entire period (past and subsequent contract).

Termination by the agent

The Brazilian Agency Law also stipulates situations that agent could terminate the contract and still be entitled to receive the 1/12th indemnification:

  • reduction of the activities in disagreement with the contractual stipulation
  • breach of exclusivity (territory and/or products), if so stipulated in the agreement
  • determination of prices that makes the agency unfeasible and
  • default on payment of the commissions
  • force majeure

Termination without cause

Termination without cause can be done, upon payment to agent of the indemnification and with a previous notice of at least 30 days, in which situation the agent shall receive the payment of 1/3 of the remuneration received during the previous 90 days prior to the termination.

Can principal avoid the indemnification?

The only cases where the 1/12th indemnification would not be applicable are when the contract is terminated by principal with cause. The Brazilian Agency Law has limited situations for principal to terminate the contract with cause:

  • acts by agent causing disrepute of the principal
  • breach of obligations related to the agency activities
  • criminal conviction related to honor, reputation

These situations shall be clearly demonstrated. Producing the sufficiently strong evidence of the facts to configure cause for termination may not be an easy task, considering some of the facts may be subject to construing and interpreting by the parties, witnesses and ultimately the judge.

As a result, from past experiences, it is rare to see principals in conditions not to incur in the 1/12th indemnification.

Potential risk: configuring employment relationship

In addition to the indemnification, the activities developed by the agent could eventually be deemed as performed by a regular employee of the principal and, in this case, principal could be subject to compensate the agent as an employee.

Agent vs. employee

For the appreciation of the employment relationship, the individual acting as agent shall file a labor claim and demonstrate the existence of the employment relationship.

The Labor Court judge will consider the factual situation, prevailing upon the written agreements or other formal documents. The judge may rely on e-mails, witnesses and other evidence.

The elements of an employment relationship are:

  • Individual: in case the individual acts by himself to perform the services; Personal services: the services are in fact performed by the individual specifically to the Principal;;
  • Non-eventuality – exclusivity: the services are rendered in a regular basis;
  • Subordination: key factor – the individual has to follow strict instructions directed by principal, such as reporting to an employee of the principal, determined visits;
  • Rewarding – fixed remuneration: the individual is awarded regular amounts and expenses allowances

In the event the individual can demonstrate the existence of the elements to configure an employment relationship, he/she could have an award to entitle him/her to have his remuneration considered as of a regular employee for the last 5 years.

As a result, the individual would be awarded the payment of Christmas bonus (equivalent to 1 monthly remuneration per year), vacation allowance (1/3 of a monthly remuneration per year), unemployment guarantee fund (1 monthly remuneration per year) plus other benefits that he/she would be given as an employee of principal (based on the collective bargaining agreement between the employees’ and employers’ unions). The company would also be obliged to make the payment of the co-related social security contributions.

Needless to say, the result could turn into a considerable potential contingency.

The author of this article is Paulo Yamaguchi

Uno dei momenti più delicati di qualsiasi operazione di M&A è sicuramente il momento in cui si affronta il tema delle «garanzie», in particolare con riferimento alla situazione economica, patrimoniale e finanziaria della società o dell’azienda (o di un ramo d’azienda), ovvero le c.d. «business warranties».

Da un lato, infatti, il compratore vorrebbe «blindare» quanto più possibile il proprio investimento, riducendo al minimo il rischio di sorprese. Al contrario, il venditore vorrebbe contenere il più possibile le garanzie offerte, che spesso si traducono in un limite temporaneo al pieno godimento dei frutti della vendita, di cui magari necessita per effettuare un altro investimento.

È bene precisare, innanzi tutto, che con il termine «garanzie» si fa normalmente riferimento, in modo atecnico, ad un articolato set di previsioni contrattuali contenenti:

  • le dichiarazioni del venditore circa lo stato di salute della società o dell’azienda (o del ramo d’azienda) ceduta;
  • gli obblighi d’indennizzo assunti dal venditore in caso di «violazione» (ossia non corrispondenza al vero) delle dichiarazioni rese;
  • gli strumenti previsti al fine di assicurare l’effettività degli obblighi d’indennizzo assunti.

Vi sono diverse ragioni per cui tale set è necessario, ma la principale è che nei contratti di M&A non trovano applicazione le garanzie civilistiche sulle vendita se non limitatamente al bene venduto, pertanto, se il bene venduto sono le partecipazioni, le garanzie non coprono gli asset sottostanti della società, e, nei casi eccezionali in cui trovano applicazione, i termini brevi e le limitazioni stringenti rendono, comunque, opportuna l’assunzione di obbligazioni accessorie volte a garantire il buon esito economico dell’operazione.

Ciò è confermato dalla pratica: nelle operazioni di M&A non vi è contratto che non includa il set delle garanzie.

Le dichiarazioni, in particolare, recepiscono normalmente la due diligence svolta dal compratore, preceduta, a sua volta, da un non disclosure agreement (NDA), finalizzato a tutelare le informazioni messe a disposizione.

Eventuali criticità che dovessero emergere dovranno essere adeguatamente riportate. Ovviamente, non è detto che un’eventuale criticità, laddove si concretizzi, debba necessariamente far scattare un obbligo d’indennizzo. Spetterà alle parti regolamentare tale aspetto, potendo anche prevedere che il relativo rischio resti a carico del compratore, magari a fronte di una riduzione del prezzo.

In merito all’obbligo d’indennizzo dovranno poi essere attentamente negoziati alcuni aspetti. I principali sono sicuramente:

  • la durata (es. maggiore per le garanzie fiscali);
  • a chi spetta l’eventuale indennizzo (al compratore o alla società; all’uno o all’altra a seconda dei casi);
  • eventuali detrazioni e /o limitazioni (es. perdite fiscali);
  • l’importo massimo indennizzabile;
  • un’eventuale franchigia;
  • la procedura d’indennizzo (es. termini per la richiesta, procedura di composizione, situazioni particolari, etc.).

Si tratta di aspetti importantissimi, che non devono essere sottovalutati. È chiaro, ad esempio, che non disciplinare adeguatamente la procedura d’indennizzo rischia di vanificare tutto il lavoro fatto prima.

Infine, dovranno essere previsti strumenti idonei al fine di assicurare la tutela effettiva del compratore. Tra questi, quelli più tradizionali sono:

  • la fideiussione;
  • il contratto autonomo di garanzia;
  • il deposito fiduciario («escrow»);
  • la dilazione di pagamento;
  • il meccanismo di «earn out»;
  • il c.d. «price adjustment»;
  • la lettera di patronage;
  • il pegno e/o l’ipoteca.

Si tratta di strumenti tutti più o meno largamente utilizzati nella pratica, che presentano ciascuno dei pro e dei contro.

Qui, tuttavia, vogliamo occuparci di un nuovo strumento di natura assicurativa, a cui si sta cominciando a fare ricorso negli ultimi tempi: le c.d. «Polizze Warranty & Indemnity».

Con una polizza W&I, in pratica, l’assicuratore, a fronte del pagamento di un premio, assume su di sé il rischio derivante dalla violazione delle dichiarazioni contenute in un contratto di M&A.

Presupposto fondamentale, ovviamente, è che la violazione derivi da fatti antecedenti al closing e non noti in quel momento (e, quindi, non evidenziati dalla due diligence effettuata).

La polizza può essere sottoscritta dal compratore (buyer side) o dal venditore (seller side). Di regola è preferita la prima soluzione. Tali polizze W&I presentano numerosi vantaggi:

  • si ottiene una garanzia a fronte di un venditore non sempre disponibile ad impegnarsi contrattualmente;
  • la polizza generalmente non prevede l’ipotesi di regresso nei confronti del venditore, salvo il caso di dolo, per cui il venditore è integralmente liberato;
  • è possibile ottenere un massimale maggiore di quello previsto nel contratto di compravendita;
  • analogamente, la copertura può essere prevista per un periodo più lungo;
  • si facilitano le relazioni con il venditore, specie nel caso ci siano più venditori ed alcuni di essi restino nella società, magari occupando un posto nel Consiglio d’Amministrazione;
  • si facilita notevolmente il processo d’indennizzo, specie nel caso in cui ci siano più venditori, magari persone fisiche;
  • il compratore riesce ad avere una maggiore certezza di solvibilità.

Il costo della polizza potrebbe essere condiviso tra le parti, eventualmente con uno sconto del prezzo, che il venditore potrebbe essere disposto a concedere tenuto conto del fatto che non dovrà rilasciare altre garanzie e potrà godere immediatamente dei frutti della vendita.

Il premio è normalmente compreso tra l’1% ed il 2% del limite d’indennizzo previsto (con un premio minimo).

Attualmente, i limiti principali di questo strumento paiono essere, oltre al prezzo, che rende lo strumento adatto principalmente ad operazioni di importo non piccolo, la franchigia standard normalmente prevista, pari all’1% dell’Enterprise Value del Target, riducibile allo 0,5% a fronte di un innalzamento del premio. Da tenere presente inoltre che la polizza W&I implica la revisione della due diligence da parte della compagnia, che può tradursi in un intervento attivo nella negoziazione delle garanzie.

A parte ciò, lo strumento è da considerare attentamente: in presenza di situazioni particolarmente complesse, potrebbe rappresentare la giusta soluzione per sbloccare situazioni di stallo negoziale e rendere più agevoli negoziazioni tra investitori professionali e PMI.

Anton Molchanov

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    Italy – How Covid19 impacts on Private Equity and Venture Capital transactions

    31 Maggio 2020

    • Italia
    • M&A

    There were hardly even a few businesses worldwide not affected by the corona pandemic. As lockdown measures were expanding from March 2020, dozens of visitor-dependent (including retail, public transportation, HoReCa, leisure, entertainment & sport) companies’ value dropped astonishingly. This immediately resulted in numerous RFPs coming in and out NPL funds and distress investors being ready as never to pluck those companies ripe enough.

    Well, at least that is how the things should have been.

    A general picture of M&A demand remains with no great changes. According to the recent DataSite EMEA report first 2021 quarter shown 40 % deal value increase and 14 percent deal volume growth. Some sceptic experts already highlighted that Q1 references are insufficient – as Q1 2020 was painted in an unseen uncertainty and hard-model governmental interference whilst Q1 2021 came in much more predictable conditions with vaccination campaigns being successful and more lockdowns lightened.

    The 2020 picture for the distressed part of the global (and particularly EMEA) part of M&A market is quite the same. With hundreds of companies still receiving governmental support and financial institutions still having a wide liquidity, the 2020 data from Bloomberg reports show no Big Bang in distress deals (either arising from pre-pack agreements between debtors and creditors or from formal insolvency processes), at least if compared with 2007-8 recession years.

    Nevertheless Bloomberg themselves recognize that 2021 market might become red-hot. Whether this prognosis will materialize soon – here are four basic tips to hold in mind when thinking on insolvency-sed distress M&A deal on either – buyer or seller side:

    1. asset or going-concern purchase. A key business decision is understanding of whether a target business is viable enough and fits in the buyer’s existing\planned portfolio to be bought as a going-concern company. Should there be no certainty – a rule of thumb with almost always be to stick with the asset deal being more secured and the target itself much easier to allocate.
      On the other hand, for a manufacturing target license and related IP rights holding might constitute a large part of the business’ value – without which the desired asset appears to be a no-hand pot.
    1. watch for exclusivity – as asset-based distressed purchase might lack one because of the procedural obligation of going through bidding process.
    2. beware of easy ways. With so-called reverse vesting orders and free-and-clean sales an SP process might look very comfortable for a buyer eager to obtaining the target clean of any burdens (liens, mortgages, tax liabilities). Might look – but rarely be such within FSU and a part of CEE countries where a big chance of facing clawback action exists, especially with a huge state (tax\duty) interest at stake.
    3. do post-deal homework. When purchasing a going concern company it is for the newly-appointed management to be concerned the most: in a number of jurisdictions they might be boomeranged with management-liability claims resulting from previous management\shareholders cadence.
    4. have an insurance company over the seller’s back. In case any post-closing tails appear, this will give a substantial level of calmness for both sides relying on the insurance to cover a part of the purchase price or post-deal liabilities.

    With the post-pandemic distress M&A yet to come and investors being ready as never, these rules will certainly be of use. As S&P 500 non-financials, in late 2020 corporate balance sheets reflected more than $2 trillion of cash – guess if there are funds for making your deal as well? Just remember: there is no one-size-fits-all approach in doing the distress deal and there always is a place for bespoke solutions given by true professionals.

    In 2019 the Private Equity and Venture Capital players have invested Euro 7,223 million in 370 transactions in the Italian Market, 26% less than 2018; these are the outcomes released on March 24th by AIFI (Italian Association of Private Equity, Venture Capital e Private Debt).

    In this slowing down scenario the spreading of Covid-19 is impacting Private Equity and Venture Capital transactions currently in progress, thus raising implications and alerts that will considerably affect both further capital investments and the legal approach to investments themselves.

    Companies spanning a wide range of industries are concerned by Covid-19 health emergency, with diverse impacts on businesses depending on the industry. In this scenario, product companies, direct-to-consumer companies, and retail-oriented businesses appear to be more affected than service, digital, and hi-tech companies. Firms and investors will both need to batten down the hatches, as to minimize the effects of the economic contraction on the on-going investment transactions. In this scenario, investors hypothetically backing off from funding processes represent an issue of paramount concern for start-ups, as these companies are targeted by for VC and PE investments. In that event, the extent of the risk would be dependent upon the investment agreements and share purchase agreements (SPAs) entered into and the term sheets approved by the parties.

    MAC/MAE clauses

    The right of investors to withdrawal (way out) from a transaction is generally secured by the so-called MAC or MAE clauses – respectively, material adverse change clause or material adverse effect. These clauses, as the case may be and in the event of unforeseeable circumstances, upon the subscription of the agreements, which significantly impact the business or particular variables of the investment, allow investors to decide not to proceed to closing, not to proceed to the subscription and the payment of the share capital increase, when previously resolved, to modify/renegotiate the enterprise value, or to split the proposed investment/acquisition into multiple tranches.

    These estimates, in terms of type and potential methods of application of the clauses, usually depend on a number of factors, including the governing law for the agreements – if other than Italian – with this circumstance possibly applying in the case of foreign investors imposing the existing law in their jurisdiction, as the result of their position in the negotiation.

    When the enforcement of MAC/MAE clauses leads to the modification/renegotiation of the enterprise value – that is to be lowered – it is advisable to provide for specific contract terms covering calculating mechanisms allowing for smoothly redefining the start-up valuation in the venture capital deals, with the purpose of avoiding any gridlocks that would require further involvement of experts or arbitrators.

    In the absence of MAC/MAE clauses and in the case of agreements governed by the Italian law, the Civil Code provides for a contractual clause called ‘supervenient burdensomeness’ (eccessiva onerosità sopravvenuta) of a specific performance (i.e. the investment), with the consequent right for the party whose performance has become excessively burdensome to terminate the contract or to make changes to the contract, with a view to fair and balanced conditions – this solution however implies an inherent degree of complexity and cannot be instantly implemented. In case of agreements governed by foreign laws, it shall be checked whether or not the applicable provisions allow the investor to exit the transaction.

    Interim Period clauses

    MAC/MAE are generally negotiated when the time expected to closing is medium or long. Similarly, time factors underpin the concept of the Interim Period clauses regulating the business operation in the period between signing and closing, by re-shaping the company’s ordinary scope of business, i.e. introducing maximum expenditure thresholds and providing for the prohibition to execute a variety of transactions, such as capital-related transactions, except when the investors, which shall be entitled to remove these restrictions from time to time, agree otherwise.

    It is recommended to ascertain that the Interim Period clauses provide for a possibility to derogate from these restrictions, following prior authorization from the investors, and that said clauses do not require, where this possibility is lacking, for an explicit modification to the provision because of the occurrence of any operational need due to the Covid-19 emergency.

    Conditions for closing

    The Government actions providing for measures to contain coronavirus have caused several slowdowns that may impact on the facts or events that are considered as preliminary conditions which, when occurring, allow to proceed to closing. Types of such conditions range from authorisations to public entities (i.e. IPs jointly owned with a university), to the achievement of turnover objectives or the completion of precise milestones, that may be negatively affected by the present standstill of companies and bodies. Where these conditions were in fact jeopardised by the events triggered by the Covid-19 outbreak, this would pose important challenges to closing, except where expressly provided that the investor can renounce, with consent to proceed to the investment in all cases. This is without prejudice to the possibility of renegotiating the conditions, in agreement with all the parties.

    Future investments: best practice

    Covid-19 virus related emergency calls for a change in the best practice of Private Equity and Venture Capital transactions: these should carry out detailed Due diligences on aspects which so far have been under-examined.

    This is particularly true for insurance policies covering cases of business interruption resulting from extraordinary and unpredictable events; health insurance plans for employees; risk management procedures in supply chain contracts, especially with foreign counterparts; procedures for smart working and relevant GDPR compliance issues in case of targeted companies based in EU and UK; contingency plans, workplace safety, also in connection with the protocols that ensure ad-hoc policies for in-house work.

    Investment protection should therefore also involve MAC/MAE clauses and relevant price adjustment mechanisms, including for the negotiation of contract-related warranties (representation & warranties). A special focus shall be given now, with a different approach, to the companies’ ability to tackle and minimize the risks that may arise from unpredictable events of the same scope as Covid-19, which is now affecting privacy systems, the workforce, the management of supply chain contracts, and the creditworthiness of financing agreements.

    This emergency will lead investors to value the investments with even greater attention to information, other than financial ones, about targeted companies.

    Indeed, it is mandatory today to gain overview on the resilience of businesses, in terms of structure and capability, when these are challenged by the exogenous variables of the market on the one side, and by the endogenous variables on the other side – to be now understood as part of the global economy.

    There is however good news: Venture Capital and Private Equity, like any other ecosystem, will have its own response capacity and manage to gain momentum, as it happened in 2019 when Italy witnessed an unprecedented increase in investments. The relevant stakeholders are already developing coping strategies. Transactions currently in progress are not halted – though slowed down. Indeed, the quarantine does not preclude negotiations or shareholders’ meetings, which are held remotely or by videoconference. This also helps dispel the notion that meetings can only be conducted by getting the parties concerned round the same table.

    The author of this post is Milena Prisco.

    The COVID-19 pandemic’s dramatic disruption of the legal and business landscape has included a steep drop in overall M&A activity in Q1 2020.  Much of this decrease has been due to decreased target valuations, tighter access by buyers to liquidity, and perhaps above all underlying uncertainty as to the crisis’s duration.

    For pending transactions, whether the buyer can walk away from the deal (or seek a purchase price reduction) by invoking a material adverse change (MAC) or material adverse effect (MAE) clause – or another clause in the purchase agreement – due to COVID-19 has become a question of increasing relevance.  MAC/MAE clauses typically allow a buyer to terminate an acquisition agreement if a MAC or MAE occurs between signing and closing.

    Actual litigated cases in this area have been few and far between, as under longstanding Delaware case law[1], buyer has the burden of proving MAC or MAE, irrespective of who initiates the lawsuit.  And the standard of proof is high – a buyer must show that the effects of the intervening event are sufficiently large and long lasting as compared to an equivalent period of the prior year.  A short-term or immaterial deviation will not suffice.  In fact, Delaware courts have only once found a MAC, in the December 2018 case Akorn, Inc. v. Fresenius Kabi AG.

    And yet, since the onset of the COVID-19 pandemic, numerous widely reported COVID-19 related M&A litigations have been initiated with the Delaware Court of Chancery.  These include:

    • Bed, Bath & Beyond suing 1-800-Flowers (Del. Ch. April 1, 2020) to complete its acquisition of Perosnalizationmall.com (purchaser sought an extension in closing, without citing specifically the contractual basis for the request);
    • Level 4 Yoga, franchisee of CorePower Yoga, suing CorePower Yoga (Del. Ch. Apr 2, 2020) to compel CorePower Yoga to purchase of Level 4 Yoga studios (after CorePower Yoga took the position that studio closings resulting from COVID-19 stay-at-home orders violated the ordinary course covenant);
    • Oberman, Tivoli & Pickert suing Cast & Crew (Del. Ch. Apr 6, 2020), an industry competitor, to complete its purchase of Oberman’s subsidiary (Cast & Crew maintained it was not obligated to close based on alleged insufficiencies in financial data provided in diligence);
    • SP VS Buyer LP v. L Brands, Inc. (Del. Ch. Apr 22, 2020), in which buyer sought a declaratory judgment in its favor on termination); and
    • L Brands, Inc. v. SP VS Buyer L.P., Sycamore Partners III, L.P., and Sycamore Partners III-A, L.P (Del. Ch. Apr 23), in which seller instead seeks declaratory judgment in its favor on buyer obligation to close.

    Such cases, typically signed up at an early stage of the pandemic, are likely to increase.  Delaware M&A-MAC-related jurisprudence suggests that buyers seeking to cite MAC in asserting their positions should expect an uphill fight, given buyer’s high burden of proof.  Indeed, Delaware courts’ sole finding of a MAC in Akorn was based on rather extreme facts: target’s (Akorn’s) business deteriorated significantly (40% and 20% drops in profit and equity value, respectively), measured over a full year.  And quite material to the Court’s decision was the likely devastating effect on Akorn’s business resulting from Akorn’s deceptive conduct vis-à-vis the FDA.

    By contrast, cases before and after Akorn, courts have not found a MAC/MAE, including in the 2019 case Channel Medsystems, Inc. v. Bos. Sci. Corp.  There, Boston Scientific Corporation (BSC) agreed to purchase Channel Medsystems, Inc., an early stage medical device company.  The sale was conditioned on Channel receiving FDA approval for its sole product, Cerene. In late December 2017, Channel discovered that falsified information from reports by its Vice President of Quality (as part of a scheme to steal over $2 million from Channel) was included in Channel’s FDA submissions.  BSC terminated the merger agreement in May 2018, asserting that Channel’s false representations and warranties constituted a MAC.

    The court disagreed.  While Channel and Akron both involved a fraud element, Chanel successfully resubmitted its FDA application, such that the fraudulent behavior – the court found – would not cause the FDA to reject the Cerene device.  BSC also failed to show sufficiently large or long-lasting effects on Channel’s financial position.  Channel thus reaffirmed the high bar under pre-Akron Delaware jurisprudence for courts to find a MAC/MAE (See e.g. In re IBP, Inc. S’holders Litig., 789 A.2d 14 (Del. Ch. 2001); Frontier Oil Corp. v. Holly Corp., 2005 WL 1039027 (Del. Ch. Apr. 29, 2005); Hexion Specialty Chemicals v. Huntsman Corp., 965 A.2d 715 (Del. Ch. 2008)).

    Applied to COVID-19, buyers may have challenges in invoking MAC/MAE clauses under their purchase agreements.

    First, it may simply be premature at this juncture for a buyer to show the type of longer-term effects that have been required under Delaware jurisprudence.  The long-term effects of COVID-19 itself are unclear.  Of course, as weeks turn into months and longer, this may change.

    A second challenge is certain carve-outs typically included in MAC/MAE clauses.  Notably, it is typical for these clauses to include exceptions for general economic and financial conditions generally affecting a target’s industry, unless a buyer can demonstrate that they have disproportionately affected the target.

    A buyer may be able to point to other clauses in a purchase agreement in seeking to walk away from the deal.  Of note is the ordinary course covenant that applies to the period between signing and closing.  By definition, most targets are unable to carry out business during the COVID-19 crisis consistent with past practice.  It is unclear whether courts will allow for a literal reading of these clauses, or interpret them taking into account the broader risk allocation regime as evidenced by the MAC or MAE clause in the agreement, and in doing so reject a buyer’s position.

    For unsigned deals, there may be some early lessons for practitioners as they prepare draft purchase agreements.  On buyer walk-away rights, buyers will want to ensure that the MAE/MAC definition includes express reference to “pandemics” and “epidemics”, if not to “COVID-19” itself.  Conversely, Sellers may wish to seek to loosen ordinary course covenant language, such as by including express exceptions for actions required by the MAC or MAE and otherwise ensure that they comply with all obligations under their control.  Buyers will also want to pay close attention to how COVID-19 affects other aspects of the purchase agreement, including seeking more robust representations and warranties on the impact of COVID-19 on the target’s business.

     

    [1] Although the discussion of this based Delaware law, caselaw in other U.S. jurisdictions often is consistent Delaware.  

    This week the Interim Injunction Judge of the Netherlands Commercial Court ruled in summary proceedings, following a video hearing, in a case on a EUR 169 million transaction where the plaintiff argued that the final transaction had been concluded and the defendant should proceed with the deal.

    This in an – intended – transaction where the letter of intent stipulates that a EUR 30 million break fee is due when no final agreement is signed.

    In addition to ruling on this question of construction of an agreement under Dutch law, the judge also had to rule on the break fee if no agreement was concluded and whether it should be amended or reduced because of the current Coronavirus / Covid-19 crisis.

    English Language proceedings in a Dutch state court, the Netherlands Commercial Court (NCC)

    The case is not just interesting because of the way contract formation is construed under Dutch law and application of concepts of force majeure, unforeseen circumstances and amendment of agreements under the concepts of reasonableness and fairness as well as mitigation of contractual penalties, but also interesting because it was ruled on by a judge of the English language chamber of the Netherlands Commercial Court (NCC).

    This new (2019) Dutch state court offers a relatively fast and cost-effective alternative for international commercial litigation, and in particular arbitration, in a neutral jurisdiction with professional judges selected for both their experience in international disputes and their command of English.

    The dispute regarding the construction of an M&A agreement under Dutch law in an international setting

    The facts are straightforward. Parties (located in New York, USA and the Netherlands) dispute whether final agreement on the EUR 169 million transaction has been reached but do agree a break fee of €30 million in case of non-signature of the final agreement was agreed. However, in addition to claiming there is no final agreement, the defendant also argues that the break fee – due when there is no final agreement – should be reduced or changed due to the coronavirus crisis.

    As to contract formation it must be noted that Dutch law allows broad leeway on how to communicate what may or may not be an offer or acceptance. The standard is what a reasonable person in the same circumstances would have understood their communications to mean.  Here, the critical fact is that the defendant did not sign the so-called “Transaction Agreement”. The letter of intent’s binary mechanism (either execute and deliver the paperwork for the Transaction Agreement by the agreed date or pay a EUR 30 million fee) may not have been an absolute requirement for contract formation (under Dutch law) but has significant evidentiary weight. In M&A practice – also under Dutch law – with which these parties are thoroughly familiar with, this sets a very high bar for  concluding a contract was agreed other than by explicit written agreement. So, parties may generally comfortably rely on what they have agreed on in writing with the assistance of their advisors.

    The communications relied on by claimant in this case did not clear the very high bar to assume that despite the mechanism of the letter of intent and the lack of a signed Transaction Agreement there still was a binding agreement. In particular attributing the other party’s advisers’ statements and/or conduct to the contracting party they represent did not work for the claimant in this case as per the verdict nothing suggested that the advisers would be handling everything, including entering into the agreement.

    Court order for actual performance of a – deemed – agreement on an M&A deal?

    The Interim Injunction Judge finds that there is not a sufficient likelihood of success on the merits so as to justify an interim measure ordering the defendant to actually perform its obligations under the disputed Transaction Agreement (payment of EUR 169 million and take the claimant’s 50% stake in an equestrian show-jumping business).

    Enforcement of the break fee despite “Coronavirus”?

    Failing the conclusion of an agreement, there was still another question to answer as the letter of intent mechanism re the break fee as such was not disputed. Should the Court enforce the full EUR 30 million fee in the current COVID-19 circumstances? Or should the fee’s effects be modified, mitigated or reduced in some way, or  the fee agreement should even be dissolved?

    Unforeseen circumstances, reasonableness and fairness

    The Interim Injunction Judge rules that the coronavirus crisis may be an unforeseen circumstance, but it is not of such a nature that, according to standards of reasonableness and fairness, the plaintiff cannot expect the break fee obligation to remain unchanged. The purpose of the break fee is to encourage parties to enter into the transaction and attribute / share risks between them. As such the fee limits the exposure of the parties. Payment of the fee is a quick way out of the obligation to pay the purchase price of EUR 169 million and the risks of keeping the target company financially afloat. If financially the coronavirus crisis turns out less disastrous than expected, the fee of EUR 30 million may seem high, but that is what the parties already considered reasonable when they waived their right to invoke the unreasonableness of the fee. The claim for payment of the EUR 30 million break fee is therefore upheld by the Interim Injunction Judge.

    Applicable law and the actual practice of it by the courts

    The relevant three articles are in this case articles 6:94, 6:248 and 6:258 of the Dutch Civil Code. They relate to the mitigation of contractual penalties, unforeseen circumstances and amendment of the agreement under the tenets of reasonableness and fairness. Under Dutch law the courts must with all three exercise caution. Contracts must generally be enforced as agreed. The parties’ autonomy is deemed paramount and the courts’ attitude is deferential. All three articles use language stating, essentially, that interference by the courts in the contract’s operation is allowed only to avoid an “unacceptable” impact, as assessed under standards of reasonableness and fairness.

    There is at this moment of course no well- established case law on COVID-19. However, commentators have provided guidance that is very helpful to think through the issues. Recently a “share the pain” approach has been advocated by a renowned law Professor, Tjittes, who focuses on preserving the parties’ contractual equilibrium in the current circumstances. This is, in the Court’s analysis, the right way to look at the agreement here. There is no evidence in the record suggesting that the parties contemplated or discussed the full and exceptional impact of the COVID-19 crisis. The crisis may or may not be unprovided for.  However, the court rules in the current case there is no need to rule on this issue. Even if the crisis is unprovided for, there is no support in the record for the proposition that the crisis makes it unacceptable for the claimant to demand strict performance by the defendant. The reasons are straightforward.

    The break fee allocates risk and expresses commitment and caps exposure. The harm to the business may be substantial and structural, or it may be short-term and minimal. Either way, the best “share the pain” solution, to preserve the contractual equilibrium in the agreement, is for the defendant to pay the fee as written in the letter of intent. This allocates a defined risk to one party, and actual or potential risks to the other party. Reducing the break fee in any business downturn, the fee’s express purpose – comfort and confidence to get the deal done – would not be accomplished and be derived in precisely the circumstances in which it should be robust. As a result, the Court therefore orders to pay the full EUR 30 million fee. So the break fee stipulation works under the circumstances without mitigation because of the Corona outbreak.

    The Netherlands Commercial Court, continued

    As already indicated above, the case is interesting because the verdict has been rendered by a Dutch state court in English and the proceedings where also in English. Not because of a special privilege granted in a specific case but based on an agreement between parties with a proper choice of forum clause for this court. In addition to the benefit to of having an English forum without mandatorily relying on either arbitration or choosing an anglophone court, it also has the benefit of it being a state court with the application of the regular Dutch civil procedure law, which is well known by it’s practitioners and reduces the risk of surprises of a procedural nature.  As it is as such also a “normal” state court, there is the right to appeal and particularly effective under Dutch law access to expedited proceeding as was also the case in the example referred to above. This means a regular procedure with full application of all evidentiary rules may still follow, overturning or confirming this preliminary verdict in summary proceedings.

    Novel technology in proceedings

    Another first or at least a novel application is that all submissions were made in eNCC, a document upload procedure for the NCC. Where the introduction of electronic communication and litigation in the Dutch court system has failed spectacularly, the innovations are now all following in quick order and quite effective. As a consequence of the Coronavirus outbreak several steps have been quickly tried in practice and thereafter formally set up. At present this – finally – includes a secure email-correspondence system between attorneys and the courts.

    And, also by special order of the Court in this present case, given the current COVID-19 restrictions the matter was dealt with at a public videoconference hearing on 22 April 2020 and the case was set for judgment on 29 April 2020 and published on 30 April 2020.

    Even though it is a novel application, it is highly likely that similar arrangements will continue even after expiry of current emergency measures. In several Dutch courts videoconference hearings are applied on a voluntary basis and is expected that the arrangements will be formalized.

    Eligibility of cases for the Netherlands Commercial Court

    Of more general interest are the requirements for matters that may be submitted to NCC:

    • the Amsterdam District Court or Amsterdam Court of Appeal has jurisdiction
    • the parties have expressly agreed in writing that proceedings will be in English before the NCC (the ‘NCC agreement’)
    • the action is a civil or commercial matter within the parties’ autonomy
    • the matter concerns an international dispute.

    The NCC agreement can be recorded in a clause, either before or after the dispute arises. The Court even recommends specific wording:

    “All disputes arising out of or in connection with this agreement will be resolved by the Amsterdam District Court following proceedings in English before the Chamber for International Commercial Matters (“Netherlands Commercial Court” or “NCC District Court”), to the exclusion of the jurisdiction of any other courts. An action for interim measures, including protective measures, available under Dutch law may be brought in the NCC’s Court in Summary Proceedings (CSP) in proceedings in English. Any appeals against NCC or CSP judgments will be submitted to the Amsterdam Court of Appeal’s Chamber for International Commercial Matters (“Netherlands Commercial Court of Appeal” or “NCCA”).”

    The phrase “to the exclusion of the jurisdiction of any other courts” is included in light of the Hague Convention on Choice of Court Agreements. It is not mandatory to include it of course and parties may decide not to exclude the jurisdiction of other courts or make other arrangements they consider appropriate. The only requirement being that such arrangements comply with the rules of jurisdiction and contract. Please note that choice of court agreements are exclusive unless the parties have “expressly provided” or “agreed” otherwise (as per the Hague Convention and Recast Brussels I Regulation).

    Parties in a pending case before another Dutch court or chamber may request that their case be referred to NCC District Court or NCC Court of Appeal. One of the requirements is to agree on a clause that takes the case to the NCC and makes English the language of the proceedings. The NCC recommends using this language:

    We hereby agree that all disputes in connection with the case [name parties], which is currently pending at the *** District Court (case number ***), will be resolved by the Amsterdam District Court following proceedings in English before the Chamber for International Commercial Matters (“Netherlands Commercial Court” or ”NCC District Court). Any action for interim measures, including protective measures, available under Dutch law will be brought in the NCC’s Court in Summary Proceedings (CSP) in proceedings in English. Any appeals against NCC or CSP judgments will be submitted to the Amsterdam Court of Appeal’s Chamber for International Commercial Matters (“Netherlands Commercial Court of Appeal” or “NCC Court of Appeal”).

    To request a referral, a motion must be made before the other chamber or court where the action is pending, stating the request and contesting jurisdiction (if the case is not in Amsterdam) on the basis of a choice-of-court agreement (see before).

    Additional arrangements in the proceedings before the Netherlands Commercial Court

    Before or during the proceedings, parties can also agree special arrangements in a customized NCC clause or in another appropriate manner. Such arrangements may include matters such as the following:

    • the law applicable to the substantive dispute
    • the appointment of a court reporter for preparing records of hearings and the costs of preparing those records
    • an agreement on evidence that departs from the general rules
    • the disclosure of confidential documents
    • the submission of a written witness statement prior to the witness examination
    • the manner of taking witness testimony
    • the costs of the proceedings.

    Visiting lawyers and typical course of the procedure

    All acts of process are in principle carried out by a member of the Dutch Bar. Member of the Bar in an EU or EEA Member State or Switzerland may work in accordance with Article 16e of the Advocates Act (in conjunction with a member of the Dutch Bar). Other visiting lawyers may be allowed to speak at any hearing.

    The proceedings will typically follow the below steps:

    • Submitting the initiating document by the plaintiff (summons or request as per Dutch law)
    • Assigned to three judges and a senior law clerk.
    • The defendant submits its defence statement.
    • Case management conference or motion hearing (e.g. also in respect of preliminary issues such as competence, applicable law etc.) where parties may present their arguments.
    • Judgment on motions: the court rules on the motions. Testimony, expert appointment, either at this stage or earlier or later.
    • The court may allow the parties to submit further written statements.
    • Hearing: the court interviews the parties and allows them to present their arguments. The court may enquire whether the dispute could be resolved amicably and, where appropriate, assist the parties in a settlement process. If appropriate, the court may discuss with the parties whether it would be advisable to submit part or all of the dispute to a mediator. At the end of the hearing, the court will discuss with the parties what the next steps should be.
    • Verdict: this may be a final judgment on the claims or an interim judgment ordering one or more parties to produce evidence, allowing the parties to submit written submissions on certain aspects of the case, appointing one or more experts or taking other steps.

    Continuous updates, online resources Netherlands Commercial Court

    As a final note the English language website of the Netherlands Commercial Court provides ample information on procedure and practical issues and is updated with a high frequence. Under current circumstance even at a higher pace. In particular for practitioners it’s recommended to regularly consult the website. https://www.rechtspraak.nl/English/NCC/Pages/default.aspx

    Le operazioni di acquisizione (M&A) in Italia, nella maggior parte dei casi, vengono realizzate attraverso acquisto di partecipazioni (‘share deal’) o di azienda o ramo d’azienda (‘asset deal’). Per ragioni principalmente fiscali sono più frequenti gli share deal rispetto agli asset deal, nonostante l’asset deal consenta una migliore limitazione dei rischi per l’acquirente. Vedremo le principali differenze tra share deal e asset deal in termini di rischi e di rapporti tra venditore e acquirente.

    Preferenza per operazioni di M&A mediante acquisto di partecipazioni (‘share deal’) rispetto ad acquisto di azienda o ramo d’azienda (‘asset deal’) nel mercato italiano

    In Italia, le operazione di acquisizione (M&A) vengono realizzate, nella maggior parte dei casi, attraverso acquisto di partecipazioni (‘share deal’) o di azienda o ramo d’azienda (‘asset deal’). Altre modalità, come la fusione, sono meno frequenti.

    Con l’acquisto di quote o azioni della società acquisita (‘share deal’) l’acquirente acquisisce, indirettamente, l’intero patrimonio aziendale (attività, passività, rapporti) e quindi si fa carico di tutti i rischi relativi alla precedente gestione della società.

    Con l’acquisto dell’azienda o di un ramo d’azienda (‘asset deal’) l’acquirente acquisisce un insieme di beni e rapporti organizzati per l’esercizio dell’impresa (immobili, impianti, dipendenti, contratti, crediti, debiti, ecc.). Il vantaggio dell’asset deal risiede nella possibilità per le parti di definire il perimetro del trasferimento e, quindi, per l’acquirente, di limitare i rischi legali dell’operazione.

    Nonostante questo vantaggio, la maggior parte delle operazioni di acquisizione in Italia avviene attraverso acquisto di partecipazioni. Nel 2018 gli acquisti di partecipazioni (azioni o quote) sono state circa 78.400, mentre le cessioni di azienda sono state circa 35.900 (fonte: www.notariato.it/it/news/dati-statistici-notarili-anno-2018). E va osservato che il dato delle cessioni d’azienda comprende anche le aziende di piccole o piccolissime dimensioni esercitate da imprenditori individuali, per le quali l’alternativa dello share deal (pur praticabile, attraverso il conferimento dell’azienda in una newco e la cessione delle partecipazioni nella newco) non è percorribile in concreto per ragioni di costo.

    Costi fiscali delle operazioni di acquisizione (M&A) in Italia

    La principale ragione della preferenza per l’acquisto di partecipazione (‘share deal’) rispetto all’acquisto di azienda (‘asset deal’) risiede nei costi fiscali dell’operazione. Vediamo quali sono, in linea generale.

    Nell’acquisto di partecipazioni, le imposte dirette a carico del venditore vengono calcolate sulla plusvalenza, secondo le seguenti percentuali:

    • se il venditore è una società di capitali (s.p.a.; s.r.l.; s.a.p.a.) l’aliquota è del 24% della plusvalenza. Ma, a determinate condizioni, si applica il regime della c.d. PEX (participation exemption) con applicazione dell’aliquota del 24% solo sul 5% della plusvalenza.
    • Se il venditore è una persona fisica l’aliquota sulla plusvalenza è del 26%.
    • Se il venditore è una società di persone (s.s.; s.n.c..; s.a.s.) la plusvalenza è integralmente imponibile, tuttavia al ricorrere di determinate condizioni, l’imponibilità è limitata al 60% dell’ammontare della plusvalenza. In entrambi i casi l’aliquota applicabile è quella marginale riferita a ciascun socio a cui il reddito viene imputato per trasparenza.

    Nell’acquisto di partecipazioni si applica l’imposta di registro, normalmente a carico dell’acquirente, di euro 200.

    Anche nell’acquisto di azienda, le imposte dirette a carico del venditore vengono calcolate sulla plusvalenza. Se il venditore è una società di capitali, l’aliquota è del 24% della plusvalenza. Se il venditore è una società di persone (con soci persone fisiche) o un imprenditore individuale, le aliquote dipendono dal reddito del venditore.

    Nell’acquisto di azienda si applicano le imposte indirette, normalmente a carico dell’acquirente, calcolate sulla parte del prezzo attribuibile ai singoli beni trasferiti. Il prezzo è il risultato delle attività trasferite detratte le passività trasferite. Le percentuali sono diverse a seconda del tipo di beni. In generale:

    • ai beni mobili si applica una imposta di registro del 3%;
    • all’avviamento si applica una imposta di registro del 3%;
    • ai fabbricati si applica una imposta di registro del 9% (e imposte ipotecarie e catastali in misura fissa di euro 50 ciascuna);
    • ai terreni si applica una imposta di registro tra il 9 e il 12% (a seconda dell’acquirente) e imposte ipotecarie e catastali in misura fissa di euro 50 ciascuna.

    Nel caso in cui l’azienda sia composta da beni soggetti ad aliquote diverse e le parti abbiano pattuito un corrispettivo unico, senza distinzione in merito al valore attribuibile ai singoli beni, l’imposta deve calcolarsi applicando all’unico corrispettivo pattuito l’aliquota più elevata.

    Va sottolineato che l’Agenzia delle Entrate può sottoporre ad accertamento il valore attribuito dalle parti ai beni immobili e all’avviamento, con conseguente rischio di applicazione di maggiori imposte.

    Share deal e asset deal: rischi e responsabilità verso i terzi

    Nell’acquisto di quote o azioni (‘share deal’) l’acquirente si fa carico, indirettamente, di tutti i rischi relativi alla precedente gestione della società.

    Nell’acquisto dell’azienda o di un ramo d’azienda (‘asset deal’), invece, le parti possono decidere il perimetro del trasferimento (quali beni e rapporti) così stabilendo, nei rapporti tra loro, i rischi che l’acquirente assume.

    Vi sono però alcune norme, che le parti non possono derogare, relative ai rapporti con i terzi, che influiscono significativamente sui rischi per il venditore e l’acquirente e quindi sulla negoziazione dell’accordo tra le parti. Le principali sono le seguenti.

    • Lavoratori dipendenti: il rapporto di lavoro continua con l’acquirente dell’azienda. Il venditore e l’acquirente sono obbligati in solido per tutti i crediti del lavoratore al momento del trasferimento (art. 2112 c.c.).
    • Debiti: il venditore è obbligato al pagamento di tutti i debiti sino alla data del trasferimento. L’acquirente è obbligato per i debiti che risultano dai libri contabili (art. 2560 c.c.).
    • Debiti e responsabilità fiscali: il venditore è obbligato al pagamento di debiti, imposte e sanzioni fiscali relative al periodo sino alla data del trasferimento.
      L’acquirente, in aggiunta all’obbligo relativo ai debiti fiscali che risultano dai libri contabili (art. 2560 c.c.), è responsabile per le imposte e sanzioni, anche se non risultano dai libri contabili, con i seguenti limiti (art. 14 D.lgs. 472/1997):
    • beneficio della preventiva escussione del venditore;
    • fino al valore dell’azienda o del ramo d’azienda acquistato;
    • per le imposte e sanzioni non ancora contestate, la responsabilità riguarda solo quelle relative all’anno della vendita dell’azienda e ai due precedenti; per le imposte e sanzioni relative al periodo anteriore ai due anni precedenti la vendita dell’azienda, la responsabilità riguarda solo quelle contestate entro tale periodo;
    • nei limiti del debito risultante alla data di trasferimento dagli atti degli uffici dell’amministrazione finanziaria. L’Agenzia delle Entrate è tenuta a rilasciare un certificato sull’esistenza di contestazioni in corso e sui debiti. Il certificato negativo, o non rilasciato entro 40 giorni dalla richiesta, libera l’acquirente da responsabilità.
    • Contratti: le parti possono scegliere quali contratti trasferire. Rispetto ai contratti trasferiti, l’acquirente subentra, anche senza il consenso del terzo contraente, nei contratti per l’esercizio dell’azienda che non hanno carattere personale (sono a carattere personale quelli che prevedono da parte del venditore una prestazione oggettivamente infungibile o soggettivamente infungibile). Inoltre il terzo contraente può recedere dal contratto entro tre mesi, se sussiste una giusta causa (ad esempio se l’acquirente non garantisce, per la propria situazione patrimoniale o per capacità tecniche, di poter adempiere al contratto) (art. 2558 c.c.).

    Alcuni strumenti per affrontare i rischi

    Per affrontare i rischi derivanti dalle responsabilità verso i terzi e i rischi generali connessi all’acquisizione, vi sono diversi strumenti negoziali e contrattuali che possono essere utilizzati. Vediamone alcuni.

    Nelle operazioni di acquisto dell’azienda o di rami d’azienda (‘asset deal’):

    • Lavoratori dipendenti: è possibile concordare con il lavoratore modifiche alle condizioni contrattuali e rinunce alla responsabilità solidale dell’acquirente e del venditore (ex art. 2112 c.c.). L’accordo con i lavoratore per essere valido deve essere concluso in sede ‘protetta’ (ad esempio: con l’assistenza delle organizzazioni sindacali).
    • Debiti:
    • trasferire all’acquirente i debiti riducendo il prezzo in misura corrispondente; la riduzione del prezzo comporta, inoltre, una minor costo fiscale dell’operazione. In caso di trasferimento dei debiti, per tutelare il venditore si può ottenere dal creditore una dichiarazione di liberazione del venditore dalla responsabilità ex art. 2560 c.c.; oppure si può prevedere che il pagamento del debito da parte dell’acquirente avvenga contestualmente al trasferimento dell’azienda (‘closing’).
    • Per i debiti non trasferiti all’acquirente, ottenere dal creditore una dichiarazione di liberazione dell’acquirente dalla responsabilità ex art. 2560 c.c.
    • Per i debiti per i quali non sia possibile ottenere la dichiarazione di liberazione da parte del creditore, pattuire forme di garanzia a favore del venditore (per i debiti trasferiti) o a favore dell’acquirente (per i debiti non trasferiti), quali ad esempio la dilazione del pagamento (a favore dell’acquirente) di parte del prezzo, il deposito fiduciario (‘escrow’) di parte del prezzo, fideiussioni bancarie o da parte dei soci.
    • Debiti e responsabilità fiscali:
    • ottenere dall’Agenzia delle Entrate il certificato ex art. 14 D.lgs. 472/1997 sui debiti e le contestazioni in corso;
    • trasferire all’acquirente i debiti riducendo il prezzo in misura corrispondente;
    • pattuire le forme di garanzia a favore del venditore (per i debiti trasferiti) e a favore dell’acquirente (per i debiti non trasferiti o per le contestazioni che non sono ancora debiti), quali ad esempio quelle sopra esposte per i debiti in generale.
    • Contratti: per quelli che vengono trasferiti:
    • verificare che le prestazioni a carico del venditore sino alla data del trasferimento siano state regolarmente adempiute, per evitare il rischio di contestazioni del terzo contraente che possono bloccare l’esecuzione del contratto;
    • almeno per i contratti più importanti (e salvo ragioni di riservatezza), cercare di ottenere conferma dal terzo contraente del benestare al trasferimento del contratto.

    Nelle operazioni di acquisto di partecipazioni (‘share deal’), in cui l’acquirente si fa carico, indirettamente, di tutti i rischi relativi alla precedente gestione della società, alcuni strumenti sono:

    • Due diligence. Svolgere una approfondita due diligence legale, fiscale e contabile sulla società, per valutare preventivamente i rischi e gestirli nella trattativa e nei contratti.
    • Dichiarazioni e garanzie (‘R&W’) e indennizzo. Prevedere nel contratto di acquisizione (‘share purchase agreement’) un set dettagliato di dichiarazioni e garanzie – e obblighi di indennizzo in caso di non conformità – a carico del venditore relativamente alla situazione della società (‘business warranties’: bilancio; situazione patrimoniale di riferimento; contratti; contenzioso; rispetto della normativa ambientale; autorizzazioni per lo svolgimento dell’attività; debiti; crediti ecc.). La trattativa sulle dichiarazioni e garanzie normalmente recepisce, gestendoli, gli esiti della due diligence (ad esempio: viene escluso dalle dichiarazioni e garanzie e dall’indennizzo un contenzioso emerso in due diligence, del quale le parti tengono conto nella definizione del prezzo). La pattuizione di dichiarazioni e garanzie sulla situazione della società (‘business warranties’) e dell’obbligo di indennizzo sono necessari negli share deal in Italia, in quanto in mancanza di tali clausole l’acquirente non può ottenere dal venditore (salvo situazioni estreme e molto rare) un risarcimento o indennizzo in caso la situazione della società sia diversa da quella considerata al momento dell’acquisto (così ad esempio: Cass. Civ. 16963/2014).
    • Garanzie per l’acquirente. Strumenti per garantire all’acquirente l’effettiva possibilità di ottenere l’indennizzo (o parte dell’indennizzo) in caso di non conformità delle dichiarazioni e garanzie. Tra queste: (a) la dilazione del pagamento di parte del prezzo; (b) il versamento di parte del prezzo in un deposito fiduciario (‘escrow’) per la durata delle dichiarazioni e garanzie e, in caso di contestazioni, fino a che la contestazione non è definita; (c) fideiussione bancaria;; (d) polizza W&I, contratto di assicurazione che copre il rischio dell’acquirente in caso di violazioni di dichiarazioni e garanzie, sino ad un importo massimo (ed esclusi alcuni rischi).

    Altri fattori che incidono sulla scelta tra share deal e asset deal

    Naturalmente la scelta di realizzare un’operazione di acquisizione in Italia mediante share deal o asset deal, dipende anche da altri fattori oltre a quello dei costi fiscali dell’operazione. Eccone alcuni.

    • Acquisto di parte del business. Si sceglie l’asset deal, quando l’operazione non riguarda l’acquisto dell’intera azienda del venditore ma solo una sua parte (un ramo d’azienda).
    • Situazione della società problematica. Si sceglie l’asset deal quando la situazione della società target è così problematica che l’acquirente non è disponibile ad assumere tutti i rischi derivanti dalla precedente gestione, ma solo parte di essi.
    • Mantenimento di un ruolo da parte del venditore. Si sceglie lo share deal quando si vuole conservare al venditore un ruolo nella società acquisita. In questo caso, oltre ad un ruolo nel management, è frequente il mantenimento da parte del venditore di una partecipazione di minoranza, con clausole di exit (diritti di put e call) decorso un certo periodo di tempo. Clausole che, spesso, legano il prezzo ai risultati futuri e, quindi, nell’interesse dell’acquirente incentivano il venditore nel ruolo manageriale e, nell’interesse del venditore, valorizzano prospettive reddituali non concretizzate al momento dell’acquisto.

    Dal 1° agosto 2021 non sarà più necessario, per la costituzione di una SRL – società a responsabilità limitata, recarsi dal notaio: la procedura potrà anche essere realizzata completamente on line, salvo casi eccezionali. Ciò è previsto dalla Direttiva U.E. 2019/1151, che impone agli stati di adeguarsi entro due anni. Vediamo cosa prevede la Direttiva.

    Come si costituisce una S.r.l. in Italia oggi

    In Italia, per costituire una società e, in particolare, una società a responsabilità limitata, è sempre necessario rivolgersi ad un notaio.

    Ciò vale anche per la c.d. «SRL semplificata», introdotta nel 2012 dal Decreto Legge «Liberalizzazioni». In questo caso, infatti, la legge prevede che, a fronte dell’utilizzo di uno statuto standard non modificabile, non vi siano oneri notarili da sostenere. Tuttavia, resta sempre necessario comparire avanti ad un notaio.

    Cosa cambierà da agosto 2021 con il recepimento della Direttiva U.E. 2019/1151

    Le cose dovranno cambiare con l’entrata in vigore della Direttiva U.E. 2019/1151, che modifica la Direttiva U.E. 2017/1132 in tema di uso di strumenti e processi digitali nel diritto societario.

    Entro il 1° agosto 2021, gli Stati membri dovranno aggiornare le procedure per la costituzione di una società in modo da garantire un doppio binario.

    Dovrà, cioè, essere possibile costituire una società sia con il metodo tradizionale, ossia rivolgendosi ad un notaio, oppure con procedure esclusivamente on line.

    Due eccezioni

    • l’art. 13-ter, par. 4, dispone che «ove sia giustificato da motivi di interesse pubblico per impedire l’usurpazione o l’alterazione di identità, gli Stati membri possono adottare misure che potrebbero richiedere la presenza fisica ai fini della verifica dell’identità del richiedente dinanzi a un’autorità o a qualsiasi persona od organismo incaricati… Gli Stati membri provvedono affinché la presenza fisica del richiedente possa essere richiesta solo se vi sono motivi di sospettare una falsificazione dell’identità e garantiscono che qualsiasi altra fase della procedura possa essere completata online»;
    • l’art. 13-octies, co. 8, dispone che «ove giustificato da motivi di interesse pubblici a garantire il rispetto delle norme sulla capacità giuridica e sull’autorità dei richiedenti di rappresentare una società, qualsiasi autorità o qualsiasi persona od organismo incaricato… può chiedere la presenza fisica del richiedente… Gli Stati membri garantiscono che tutte le altre fasi della procedura possano essere comunque completate on line».

    Gli Stati membri dovranno mettere a disposizione i modelli necessari per la costituzione delle società a responsabilità limitata «in almeno una lingua ufficiale dell’Unione ampiamente compresa dal maggior numero possibile di utenti transfrontalieri».

    Rischi

    La direttiva rappresenta, indubbiamente, un interessante tentativo di semplificazione, il cui successo dipenderà, tuttavia, da come verrà recepita dai singoli Stati membri.

    I rischi principali sono almeno due:

    1. il primo, facilmente intuibile, è che gli Stati membri rendano troppo oneroso l’accertamento dell’identità od il potere rappresentativo dei richiedenti, rendendo più semplice, in definitiva, il tradizionale ricorso ad un notaio;
    2. il secondo è che le procedure on line siano poco chiare o comprensibili, specie agli utenti stranieri. In tal senso, non appare sufficiente che i modelli siano resi disponibili, ma sarà necessario che le procedure online siano orientate alla maggiore semplificazione possibile e che i modelli siano tutti disponibili almeno in lingua inglese.

    Infine, è evidente che la digitalizzazione del procedimento di costituzione di una società non elimina l’opportunità di rivolgersi ad un professionista con il compito di consigliare il cliente nelle scelte che sarà necessario fare, ad esempio in materia di corporate governance.

    A legal due diligence of a Brazilian target company should analyze the existence and the content of Agency Agreements, including values paid to the agent and the nature of such payments and the factual situation of the target’s agents, in order to evaluate potential contingencies.

    One usual suspect in legal due diligences of Brazilian target companies in M&A transactions that should not be overlooked is the existence of agency agreements, due to:

    • the obligation to indemnify the agent stipulated by law: at least 1/12th of all commissions paid throughout the entire term of the agency agreement; and
    • the risks for the agency being disregarded and considered as an employment relationship, subjecting the principal to compensate the agent as an employee with all rights, benefits, taxes and social contributions.

    This should be considered for evaluation of potential contingencies and the impacts on the valuation of the target.

    No doubt that agents can be an important component of the sales force of the business and can be strategic for the activity of the principal, in view of a certain independence and for not increasing the payroll of a company.

    On the other hand, under Brazilian laws, the protective nature of the agency demands the principal a considerable level of attention.

    Indemnification

    Brazilian Federal Law No. 4,886/65 as amended – the Brazilian Agency Law – determines that the agent is entitled to, at the termination of an agency agreement, receive an indemnification of 1/12th calculated over all the commissions paid throughout the duration of the entire period of the agency agreement.

    The Brazilian Agency Law stipulates that if the parties sign a new contract within 6 months after the expiration of the previous, the relation between agent and principal shall be deemed as the same relationship and thus, the duration to calculate the indemnification shall encompass the entire period (past and subsequent contract).

    Termination by the agent

    The Brazilian Agency Law also stipulates situations that agent could terminate the contract and still be entitled to receive the 1/12th indemnification:

    • reduction of the activities in disagreement with the contractual stipulation
    • breach of exclusivity (territory and/or products), if so stipulated in the agreement
    • determination of prices that makes the agency unfeasible and
    • default on payment of the commissions
    • force majeure

    Termination without cause

    Termination without cause can be done, upon payment to agent of the indemnification and with a previous notice of at least 30 days, in which situation the agent shall receive the payment of 1/3 of the remuneration received during the previous 90 days prior to the termination.

    Can principal avoid the indemnification?

    The only cases where the 1/12th indemnification would not be applicable are when the contract is terminated by principal with cause. The Brazilian Agency Law has limited situations for principal to terminate the contract with cause:

    • acts by agent causing disrepute of the principal
    • breach of obligations related to the agency activities
    • criminal conviction related to honor, reputation

    These situations shall be clearly demonstrated. Producing the sufficiently strong evidence of the facts to configure cause for termination may not be an easy task, considering some of the facts may be subject to construing and interpreting by the parties, witnesses and ultimately the judge.

    As a result, from past experiences, it is rare to see principals in conditions not to incur in the 1/12th indemnification.

    Potential risk: configuring employment relationship

    In addition to the indemnification, the activities developed by the agent could eventually be deemed as performed by a regular employee of the principal and, in this case, principal could be subject to compensate the agent as an employee.

    Agent vs. employee

    For the appreciation of the employment relationship, the individual acting as agent shall file a labor claim and demonstrate the existence of the employment relationship.

    The Labor Court judge will consider the factual situation, prevailing upon the written agreements or other formal documents. The judge may rely on e-mails, witnesses and other evidence.

    The elements of an employment relationship are:

    • Individual: in case the individual acts by himself to perform the services; Personal services: the services are in fact performed by the individual specifically to the Principal;;
    • Non-eventuality – exclusivity: the services are rendered in a regular basis;
    • Subordination: key factor – the individual has to follow strict instructions directed by principal, such as reporting to an employee of the principal, determined visits;
    • Rewarding – fixed remuneration: the individual is awarded regular amounts and expenses allowances

    In the event the individual can demonstrate the existence of the elements to configure an employment relationship, he/she could have an award to entitle him/her to have his remuneration considered as of a regular employee for the last 5 years.

    As a result, the individual would be awarded the payment of Christmas bonus (equivalent to 1 monthly remuneration per year), vacation allowance (1/3 of a monthly remuneration per year), unemployment guarantee fund (1 monthly remuneration per year) plus other benefits that he/she would be given as an employee of principal (based on the collective bargaining agreement between the employees’ and employers’ unions). The company would also be obliged to make the payment of the co-related social security contributions.

    Needless to say, the result could turn into a considerable potential contingency.

    The author of this article is Paulo Yamaguchi

    Uno dei momenti più delicati di qualsiasi operazione di M&A è sicuramente il momento in cui si affronta il tema delle «garanzie», in particolare con riferimento alla situazione economica, patrimoniale e finanziaria della società o dell’azienda (o di un ramo d’azienda), ovvero le c.d. «business warranties».

    Da un lato, infatti, il compratore vorrebbe «blindare» quanto più possibile il proprio investimento, riducendo al minimo il rischio di sorprese. Al contrario, il venditore vorrebbe contenere il più possibile le garanzie offerte, che spesso si traducono in un limite temporaneo al pieno godimento dei frutti della vendita, di cui magari necessita per effettuare un altro investimento.

    È bene precisare, innanzi tutto, che con il termine «garanzie» si fa normalmente riferimento, in modo atecnico, ad un articolato set di previsioni contrattuali contenenti:

    • le dichiarazioni del venditore circa lo stato di salute della società o dell’azienda (o del ramo d’azienda) ceduta;
    • gli obblighi d’indennizzo assunti dal venditore in caso di «violazione» (ossia non corrispondenza al vero) delle dichiarazioni rese;
    • gli strumenti previsti al fine di assicurare l’effettività degli obblighi d’indennizzo assunti.

    Vi sono diverse ragioni per cui tale set è necessario, ma la principale è che nei contratti di M&A non trovano applicazione le garanzie civilistiche sulle vendita se non limitatamente al bene venduto, pertanto, se il bene venduto sono le partecipazioni, le garanzie non coprono gli asset sottostanti della società, e, nei casi eccezionali in cui trovano applicazione, i termini brevi e le limitazioni stringenti rendono, comunque, opportuna l’assunzione di obbligazioni accessorie volte a garantire il buon esito economico dell’operazione.

    Ciò è confermato dalla pratica: nelle operazioni di M&A non vi è contratto che non includa il set delle garanzie.

    Le dichiarazioni, in particolare, recepiscono normalmente la due diligence svolta dal compratore, preceduta, a sua volta, da un non disclosure agreement (NDA), finalizzato a tutelare le informazioni messe a disposizione.

    Eventuali criticità che dovessero emergere dovranno essere adeguatamente riportate. Ovviamente, non è detto che un’eventuale criticità, laddove si concretizzi, debba necessariamente far scattare un obbligo d’indennizzo. Spetterà alle parti regolamentare tale aspetto, potendo anche prevedere che il relativo rischio resti a carico del compratore, magari a fronte di una riduzione del prezzo.

    In merito all’obbligo d’indennizzo dovranno poi essere attentamente negoziati alcuni aspetti. I principali sono sicuramente:

    • la durata (es. maggiore per le garanzie fiscali);
    • a chi spetta l’eventuale indennizzo (al compratore o alla società; all’uno o all’altra a seconda dei casi);
    • eventuali detrazioni e /o limitazioni (es. perdite fiscali);
    • l’importo massimo indennizzabile;
    • un’eventuale franchigia;
    • la procedura d’indennizzo (es. termini per la richiesta, procedura di composizione, situazioni particolari, etc.).

    Si tratta di aspetti importantissimi, che non devono essere sottovalutati. È chiaro, ad esempio, che non disciplinare adeguatamente la procedura d’indennizzo rischia di vanificare tutto il lavoro fatto prima.

    Infine, dovranno essere previsti strumenti idonei al fine di assicurare la tutela effettiva del compratore. Tra questi, quelli più tradizionali sono:

    • la fideiussione;
    • il contratto autonomo di garanzia;
    • il deposito fiduciario («escrow»);
    • la dilazione di pagamento;
    • il meccanismo di «earn out»;
    • il c.d. «price adjustment»;
    • la lettera di patronage;
    • il pegno e/o l’ipoteca.

    Si tratta di strumenti tutti più o meno largamente utilizzati nella pratica, che presentano ciascuno dei pro e dei contro.

    Qui, tuttavia, vogliamo occuparci di un nuovo strumento di natura assicurativa, a cui si sta cominciando a fare ricorso negli ultimi tempi: le c.d. «Polizze Warranty & Indemnity».

    Con una polizza W&I, in pratica, l’assicuratore, a fronte del pagamento di un premio, assume su di sé il rischio derivante dalla violazione delle dichiarazioni contenute in un contratto di M&A.

    Presupposto fondamentale, ovviamente, è che la violazione derivi da fatti antecedenti al closing e non noti in quel momento (e, quindi, non evidenziati dalla due diligence effettuata).

    La polizza può essere sottoscritta dal compratore (buyer side) o dal venditore (seller side). Di regola è preferita la prima soluzione. Tali polizze W&I presentano numerosi vantaggi:

    • si ottiene una garanzia a fronte di un venditore non sempre disponibile ad impegnarsi contrattualmente;
    • la polizza generalmente non prevede l’ipotesi di regresso nei confronti del venditore, salvo il caso di dolo, per cui il venditore è integralmente liberato;
    • è possibile ottenere un massimale maggiore di quello previsto nel contratto di compravendita;
    • analogamente, la copertura può essere prevista per un periodo più lungo;
    • si facilitano le relazioni con il venditore, specie nel caso ci siano più venditori ed alcuni di essi restino nella società, magari occupando un posto nel Consiglio d’Amministrazione;
    • si facilita notevolmente il processo d’indennizzo, specie nel caso in cui ci siano più venditori, magari persone fisiche;
    • il compratore riesce ad avere una maggiore certezza di solvibilità.

    Il costo della polizza potrebbe essere condiviso tra le parti, eventualmente con uno sconto del prezzo, che il venditore potrebbe essere disposto a concedere tenuto conto del fatto che non dovrà rilasciare altre garanzie e potrà godere immediatamente dei frutti della vendita.

    Il premio è normalmente compreso tra l’1% ed il 2% del limite d’indennizzo previsto (con un premio minimo).

    Attualmente, i limiti principali di questo strumento paiono essere, oltre al prezzo, che rende lo strumento adatto principalmente ad operazioni di importo non piccolo, la franchigia standard normalmente prevista, pari all’1% dell’Enterprise Value del Target, riducibile allo 0,5% a fronte di un innalzamento del premio. Da tenere presente inoltre che la polizza W&I implica la revisione della due diligence da parte della compagnia, che può tradursi in un intervento attivo nella negoziazione delle garanzie.

    A parte ciò, lo strumento è da considerare attentamente: in presenza di situazioni particolarmente complesse, potrebbe rappresentare la giusta soluzione per sbloccare situazioni di stallo negoziale e rendere più agevoli negoziazioni tra investitori professionali e PMI.