Series 79: 11.1. The Engagement Letter

Taken from our Series 79 Online Guide

11.1. The Engagement Letter

Exam questions for Function 3 will definitely ask about key M&A documents. Most likely, you will get multiple questions about these documents. Fortunately, some of these documents are similar in function to various offering documents we learned about in Chapters 5–10, although the M&A versions of these documents are often more complex, to match the complexity of M&A transactions. We will discuss each of these documents in more detail as they come up.

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Solomon Exam Prep Study Materials for the Series 79
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M&A Documents Commonly Asked About on the Exam

Document

Function

Engagement Letter

Sets out terms of relationship between seller/buyer and sell/buy-side adviser

Teaser

Generate buyer interest by providing general information; not confidential

Confidentiality Agreement (CA)

Binding contract preventing prospective buyer from misusing confidential information in various ways

Confidential Information Memorandum (CIM)

Provides additional transaction information to prospective buyers who have signed the CA

Initial Bidding Procedures Letter

Instructions to prospective buyers for submitting IOIs

Indication of Interest (IOI)

Non-binding purchase proposal from a prospective buyer; signals a desire to be included in the second round of bidding

Final Bidding Procedures Letter

Instructions to prospective buyers who were included in second round of bidding; instructions for submitting final bids