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Chicago, Illinois June 6, 2014

“Successful Transactions – What In-House Counsel Should Expect from their M&A and Antitrust Attorneys” M&A Fee Management. Chicago, Illinois June 6, 2014. M&A Fee Management. Presenters. Speakers: Gwendolyn Hassan , CNH Industrial, Burr Ridge, IL

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Chicago, Illinois June 6, 2014

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  1. “Successful Transactions – What In-House Counsel Should Expect from their M&A and Antitrust Attorneys”M&A Fee Management Chicago, Illinois June 6, 2014

  2. M&A Fee Management Presenters Speakers: Gwendolyn Hassan, CNH Industrial, Burr Ridge, IL Michael N. Levy, Global Specialties & EMEA, Ingredion Incorporated, Westchester, IL Steven Richman, Duane Morris LLP, Cherry Hill, NJ Speakers and Moderators: Florian Jörg, Bratschi Wiederkehr & Buob, Zurich, Switzerland Randall A. Hanson, Womble Carlyle Sandridge & Rice, LLP Greensboro, NC

  3. M&A Fee Management Program Overview “The panel will address the various pitfalls of fee management that we all know, such as: bidding with a competitive fee estimate, reacting to the request for flat fees, controlling the increasing fees during the transaction, communicating fee issues with the client, asking for retainers, essentials for the engagement letter and many more.” Setting: Hypothetical acquisition by US entity of a European target Discussion points in managing outside counsel fees in M&A: 1. At the transaction outset 2. As the deal progresses 3. Post-closing

  4. M&A Fee Management Hypothetical Setting and Format A US company in the food sector, represented by in-house counsel Gwendolyn and Michael, intends to acquire a mid-size European/Swiss chocolate manufacturing company. For this purpose, it seeks assistance from outside US counsel Randy and European/Swiss counsel Florian (acting as moderators and speakers). The size of the transaction and other deal details will be left somewhat vague to permit discussion around how deal factors may impact fee arrangements and fee management. We will assume the subject transaction is not expected to be of a size or complexity of, say, the purchase of Nestlé, as for this panel the only issues of interest are those pertaining to outside counsel fees. The moderators and the speakers will go through the three indicated deal stages from the fee management perspective. Steven, acting as our “Greek chorus”, will interrupt our discussions to highlight potential ethical implications at each stage.

  5. M&A Fee Management I. Fee Discussion at Transaction Outset Preliminary discussions between inside and outside counsel on the transaction, assistance requested and approaches to fees for assistance of outside US and European counsel: • Allocation of roles of inside and outside counsel (scope of work) • Billable hours vs. alternative fee arrangements • E.g.: Blended rate; capped fees; different arrangements by stage • Value pricing / fair price • How to prepare and present estimates • How to negotiate fees • How to deal with the request for fixed fees; bonus (sharing over, under) • Payment terms; requesting / requiring retainers

  6. M&A Fee Management I. Fee Discussion at Transaction Outset(continued) Memorializing the fee agreement, including terms of service set out by the client and the engagement letter from outside counsel (US and foreign): • In house counsel guidelines on billing procedures to outside counsel • Engagement letter from outside US counsel • Terms of engagement of European counsel (including confirmation of billable and payment to local counsel)

  7. M&A Fee Management II. Managing the Fee Issue During Transaction Issues arising once the fee is agreed upon, the terms of the engagement are set and the transaction is underway – the team addresses the following issues that might arise during the engagement as the transaction progress: • Managing/coordinating outside counsel • Monitoring the development of the fees (the “spend” or “burn”) in relation to the arrangement • Providing visibility to, communicating with the client • Special billing procedures (e.g. electronic), coding, etc. • Reporting templates outside of billing procedures • Expectation management based on deal developments • Interim invoices / payments on account

  8. M&A Fee Management III. Post-Closing Invoicing and Discussion Now, the transaction is closed – the attorneys and the clients will discuss issues that arise at the end of the transaction: • What does the (final) invoice look like? • Analysis and discussion on overall transaction billing • Usually set in broader context of overall assistance provided • How to deal with unexpectedly low fees / high fees – debrief on what “went wrong”, was not anticipated or properly managed, “fixes” • Setting arrangements for dealing with post-closing matters arising from the acquisition, and (hopefully for outside counsel) terms of continuing the representation with the acquired business (“day one and beyond”)

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