The Middle Ground


+ Introduction

+ Purchase and Sale

+ Closing

+ Representations & Warranties - Seller

+ Representations & Warranties - Buyer

+ Covenants

+ Conditions to Closing

+ Indemnification

+ Termination

+ Miscellaneous


With the majority of successful companies owned by Boomers and most without succession plans in place, there’s a wave of transactions starting to build. It’s the opportunity for owners to cash in on decades of work and for the firms created to endure beyond. The stakes could hardly be higher.

Encountering an unfamiliar process with so much on the line often leads sellers to engage in excessive negotiation, research, and second-guessing. That, in turn, results in higher transaction costs, fewer completed deals, and longer time horizons.

Our goal in creating this resource is to start a conversation about “the middle ground” and hopefully find it quicker. Instead of starting at extremes and going through the costly, tedious, and perilous process of negotiating to the middle, what if we started in "the middle" and made arguments, based on particular deal facts, for moving outside of it?

But, what is “the middle?”

We spent 18 months collecting and organizing our decade of experience, read what others had written on the topic, and phoned a few knowledgeable friends. As lawyers and deal professionals, we need your help to add nuance, refine the terms, and track trends.

Our analysis is grounded in the terms of an Asset Purchase Agreement (the “Agreement”), the most common deal structure in lower middle market acquisitions. For each term, we will discuss (1) the standard, middle ground contents; (2) the term’s level of importance; (3) the preferred tweaks from both the buyer’s and seller’s perspective; and, when appropriate, (4) how and why the terms in a stock sale would be materially different from those in an asset acquisition. We will also highlight the negotiation time and transaction costs typically associated with each term, as well as the section of the Agreement where each term can be found.

We hope you find it useful, Team