Due Diligence in Government Contractor Mergers and Acquisitions

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A special two day program for contract professionals, corporate counsel, lawyers, accountants, commercial and investment bankers, insurance professionals, executives and strategic managers, and M&A specialists.

Mergers and acquisitions (M&A) are key business strategies in the domestic and international economic landscapes today. Efficiency, effectiveness, and the need for scarce and special resources continue to drive organizations to acquire the products, services, processes, and intellectual talent they need to compete in the world marketplace. Due Diligence gives buyers, sellers, and merger partners the opportunity to evaluate the true worth of the partners and prospective new enterprise. The unique requirements of government contracts demand that due diligence efforts include an in-depth analysis, assessment and evaluation of those contracts.

Government contracting is an area of arcane and esoteric rules and regulations. A misstep in assessing the true values, exposures and potential liabilities of existing--and old--government contracts could be fatal to your bottom line. Your traditional M&A templates must be supplemented and strengthened. When the acquiring organization is a foreign entity, the potential for missteps is even greater. More statutes, rules, and regulations come into play.

The purpose of this course is to assist you in performing a due diligence analysis when a potential partner has government contracts. A faculty of experienced government contract practitioners will provide you with practical guidance in the conduct of a due diligence analysis. Whether you are a buyer, seller, or merger partner, you will benefit from this comprehensive program.

Coverage includes:

Novation agreements
Government discretion/rules & regulations
Security issues
Buyer & seller exposure and liabilities
Cost allowability issues
Organization costs
Advance notice and advance agreements
Defective pricing/False Claims Act issues
Protecting technology
Legal and financial analysis

There are few--if any--absolutes in the dynamic area of mergers and acquisition. This course may not provide the perfect answer to each and every situation you face. We are confident, however, that the resources, insights, and guidance you receive will prepare you to thoroughly analyze and evaluate your opportunities and exposure in your M&A activities.

Dates and Locations

November 13-14, 2012

AMA Conference Center

Arlington, VA

$1025.00

Accreditation

CLE Hours

This Program is eligible for:

11 (60 minute)

13.2 (50 minute)

CPE Hours

This Program is eligible for:

13 (CPE) hours of credit

Program Level: Basic

Program Prerequisite: None

Advance Preparation: None

Method: Group-Live

CLP Hours

This Program is eligible for:

11 (CLP) hours of credit

Related Downloads

Registration Form for fax-in registrations (PDF)

Daily Schedule

9:00 AM - 4:00 PM

Due Diligence in Government Contractor Mergers & Acquisitions
Course Curriculum

Introduction
The Various Types of Transactions and Their Key Characteristics
1. Forms of Transactions
2. Stock Purchase
3. Asset Purchase
4. Merger
5. Joint Venture
6. The Acquisition "Dance"
General Sources of Due Diligence Information
1. Publicly Available Records
2. Information Supplied by Company Management
3. Investigative Efforts - Inquiries and Interviews
Preparing the Data Room
1. Content
2. Data Room Procedures
Organizing/Managing the Due Diligence Process
1. Introduction
2. Concept - Think Proposal Preparation
3. Coordination/Cross-Fertilization - Procedures to Promote Sharing of Due Diligence Information
4. Interaction With Target Company
5. Continuation of Due Diligence Process Through Negotiation, Execution of Transaction Agreement and Closing of the Transaction
6. The Special Issues Presented by Classified Contracts
Typical Representations and Warranties in a Government Contracts Transaction
1. Financial Statements
2. Litigation
3. Material Contracts
4. Intellectual Property ("IP")
5. Employee Benefit Matters
6. Government Contracts and Government Bids
7. Government Furnished Property or Equipment
8. Backlog
9. Product Warranties
10. Clearances
11. Foreign Corrupt Practices Act ("FCPA")
12. Other Issues to Consider
Government Contracting - Unique Issues
1. Assignment/Novation
  1. Case law
  2. Federal Acquisition Regulation
  3. Agency implementation of the FAR
  4. When is government approval required?
    1. Assets transactions (direct transfers of government contracts)
    2. Mergers and consolidations (direct transfers of government contracts by operation of law)
    3. Stock transactions (indirect transfers)
    4. Corporate reorganizations
    5. Bankruptcies
  5. How is government approval obtained?
    1. Scope of the government's discretion to approve or disapprove a transaction
    2. Mechanics of novation agreement
  6. If no government approval
    1. Test of the government's legal authority
    2. Statutory remedy
  7. Miscellaneous issues
    1. Pending bids and proposals
    2. Subcontracts
2. Unique Areas of Risk
  1. Inefficiencies in obtaining business
  2. Qualification and eligibility impediments to award
    1. Responsibility
    2. Unfair competitive advantage
    3. Conflicts of interest
    4. Suspension/debarment
  3. Bid protest
  4. Quasi-criminal and criminal restrictions to eligibility
    1. The statutory offenses
    2. False Statements Act
  5. Consent to subcontractors
  6. Limits on authority of government personnel
  7. Changes
    1. Standard "Changes" clauses
    2. Changes authority
    3. Contractor's duty to proceed
    4. Procedures: unilateral or bilateral
    5. Constructive changes
  8. Cost allowability rules
  9. Cost accounting rules
  10. Government property duties
  11. Termination for convenience
    1. Government's convenience termination right
    2. Termination procedures
    3. Constructive termination
    4. Contractor recovery
    5. Partial terminations
  12. Termination for Default
    1. Contract "Default" clauses
    2. Bases for termination
    3. The termination decision
    4. Contractor defenses
    5. Government remedies
    6. Contesting default terminations
  13. Determining fair prices for negotiated contracts: TINA
  14. Disclosing commercial sales practices for GSA MAS contracts
  15. Reporting price reductions for GSA MAS contracts
  16. Determining the contract value
  17. Audits of contractor records: types and scope
  18. Foreign ownership, control, influence
  19. Anti-assignment and novation
  20. Protecting intellectual property
  21. Post-acceptance liabilities
  22. Disputes process
3. Transactions Involving Foreign Purchasers: Exon-Florio
  1. Background and basics
    1. Acquisition
    2. Foreign person
    3. Foreign control/foreign government control
    4. U.S. person
    5. Credible evidence
    6. Standards for intervention
  2. The review process
    1. Informal consultation
    2. Notice of transactions
    3. Third parties
    4. Agency notices
    5. Potential for disclosure
    6. Timetable
4. Transactions Involving Foreign Purchasers: FOCI Restrictions
  1. The basics
  2. DoD Industrial Security Program
  3. Facility Security Clearance ("FCL")
  4. The determination of FOCI
  5. Methods of negating FOCI
  6. DOE determinations
    1. DOE rules
    2. Contract terms and flow-downs
    3. Determining eligibility for FCLs or contracts
    4. Negating methods
Summary and Review: A Due Diligence Methodology in Government Contractor Mergers & Acquisitions

Course Faculty

Rand L. Allen Partner in the Washington, D.C. law firm of Wiley Rein LLP. Past Chair of the American Bar Association’s Section of Public Contract Law. B.S., United States Military Academy at West Point; J.D., Georgetown University Law Center.

Philip J. Davis Partner in the Washington, D.C. offices of Wiley Rein LLP. Represents clients in government contract matters and related litigation. B.A., cum laude, Trinity College; J.D., The George Washington University Law School; Order of the Coif.

Scott M. McCaleb Partner in the Washington D.C. offices of Wiley Rein LLP. Represents clients on all aspects of federal, state, and local procurement matters. B.A., Brown University; J.D., Georgetown University Law Center.

Richard B. O’Keeffe, Jr. Of Counsel in the Washington D.C. offices of Wiley Rein LLP. Represents clients in all stages of federal contract law and litigation. B.A., with honors, University of Virginia; J.D., Marshall-Wythe School of Law, The College of William & Mary; LL.M; Military Law, The Judge Advocate General’s Legal Center and School; LL.M., Government Procurement Law, The George Washington University Law School.

Daniel B. Pickard Partner in the Washington, D.C. law offices of Wiley Rein LLP. Represents clients in international trade and business transactions matters. B.A., The Pennsylvania State University; J.D., with honors, Golden Gate University School of Law; LL.M., with distinction, Georgetown University Law Center.

William A. Roberts, III Partner in the Washington, D.C. law firm of Wiley Rein LLP’s government contracts practice. Former assistant to the General Counsel of the U.S. Navy. B.A., Black Hills State College; J.D., with honors, University of Iowa School of Law; LL.M., with honors, The George Washington University Law School.

John B. Reynolds, III Partner in the Washington, D.C. law firm of Wiley Rein LLP’s internet, international, and government affairs practices. Particular expertise in handling international investment transactions, acquisitions, joint ventures and privatizations. B.A., magna cum laude, Williams College, Phi Beta Kappa; J.D., Yale Law School.

Cari N. Stinebower Practices law in the Washington, D.C. law offices of Wiley Rein LLP. Counsels clients on compliance with U.S. economic sanctions; the Bank Secrecy Act; the foreign Corrupt Practices Act: and export controls. B.A., cum laude, Amherst College; M.A., School of International Service, American University; J.D., Washington College of Law, American University.

Kay Tatum Partner in the Business and Finance Practice of the Washington, D.C. Law firm of Wiley Rein LLP. B.A., summa cum laude, Tulane University, Phi Beta Kappa; M.A. and Ph.D. (French), Rice University; J.D., cum laude, University of Houston’s Bates College of Law.

Christopher B. Weld Practices law in the Washington, D.C. law offices of the Wiley Rein LLP. Represents clients in a variety of international trade matters including antidumping duty investigations, export control regulations, and trade sanctions regulations. B.A., cum laude, Middlebury College; J.D., Duke University School of Law.

Accreditation

CLE Hours

This Program is eligible for:

11 (60 minute)

13.2 (50 minute)

CPE Hours

This Program is eligible for:

13 (CPE) hours of credit

Program Level: Basic

Program Prerequisite: None

Advance Preparation: None

Method: Group-Live