Part 1 | Private Equity | The State of Representations and Warranties
During this fireside conversation the panelists will explore The current State of Reps and Warranties from the points of view of an Investment Bank, an Insurance Co, an Accounting perspective and from an Attorney. Reps and Warranties refer to statements of fact that a seller makes as part of trying to persuade a buyer to purchase their business. Each of the parties in the transaction relies on the other to provide true information about the transaction. The seller provides assurance that the business is worth the investment that the buyer plans to make.
The buyer must be provided with sufficient information to support the seller’s asking price in the transaction. Some of this information includes financial statements, lists of current contracts, customer listings, and proof of asset ownership.
During the negotiations for the purchase of a business, it is the role of the buyer to demand more information from the seller in regard to certain statements of fact made by the seller. This is because the buyer bears more risks than the seller and, therefore, must make sure that all questions are forwarded to the seller for a response and that all information required for the transaction is provided.
The buyer’s legal team is also tasked with ascertaining that the deal is within the legal framework. If the buyer intends to use its stock as part of the consideration for the transaction, it must make a statement to the seller that the stock provided is free of any encumbrances and that the buyer is legally allowed to offer the stock.
Jeff Henningsen | President | Lockton
Jeff, over the past 25 years, has served the insurance needs of capital providers and equity sponsors, leading insurance diligence efforts on thousands of transactions. Prior to his role in mergers & acquisitions insurance services, he spent four years working with Randy Best of Best Associates, a Texas-based merchant bank, which provided invaluable experience for the services he now provides to clients.
Today Jeff has a reputation in the financial community as a leader in serving the insurance needs of debt and equity providers specializing in enhancing investment outcomes through insurance diligence and aggressive placement of insurance products.
Lockton Houston’s M&A team, led by Jeff, has successfully completed in excess of 10,000 due diligence projects for our financial clients. As the ninth-largest broker in the world, placing over $27+ billion in annual premiums, Lockton has proven time and again that by adding our team to lead the task of insurance due diligence, costly pitfalls and hidden liabilities can be averted.
Vincent E. Morgan | Partner | Bracewell
Vince Morgan has helped clients obtain billions of dollars in insurance proceeds and other recoveries. He represents corporate policyholders in complex coverage matters related to all types of policies, including commercial property and business interruption, reps and warranties, CGL, cyber, professional and fiduciary liabilities, D&O, E&O, environmental, trade credit, and intellectual property. Many of these have involved some of the most pressing issues of recent times, ranging from the COVID-19 pandemic, the 9/11 terrorist attacks, the Deepwater Horizon disaster, virtually every hurricane and other major weather disaster in the last 20 years, major wildfires, the Japanese earthquake and tsunami, and the opioid crisis. Aside from representing corporate clients, Vince has also obtained millions of dollars on behalf of pro bono clients.
Currently, Vince is representing clients across a multitude of industries including hospitality, professional sports, retail, healthcare, real estate, and energy on COVID-19 losses. He is also representing several private equity funds on claims under reps and warranty policies. Additionally, Vince is handling other coverage matters such as property damage and business interruption claims from recent hurricanes and other catastrophes as well as the placement of cyber insurance policies.
He is the author of the only legal treatise specifically focused on insurance coverage for catastrophe losses, having written the chapters on the Claim Process and Business Interruption, and he is currently writing a new chapter for that treatise on COVID‐19 losses. Vince is perennially listed in major peer‐based rankings and market commentators have praised him as “a fantastic tactical lawyer.” Vince has handled matters all across the US involving events spanning the globe and has served as an expert witness on insurance law in cases in the US and Europe. From time to time, he also serves as a mediator and arbitrator in coverage disputes.
Sean Sarsfield | Director | Forensics & Valuation Services | BKD
Sean Sarsfield has over 20 years of experience providing forensic accounting, economic damage quantification, and fraud investigation services for law firms, privately held businesses, and Fortune 500 companies. He has calculated multi-million-dollar damage claims for parties involved in post-acquisition disputes resulting from mergers and acquisition activities and assisted in the evaluation of business interruption claims for organizations impacted by catastrophic events. He has also provided fraud detection and investigation services when allegations of embezzlement, financial reporting fraud, and other forms of white-collar crime are involved.
Before joining BKD, Mr. Sarsfield worked for two of the largest accounting firms in the world and assisted a Fortune 500 Oil & Gas company in the evaluation of economic loss claims filed by businesses impacted by the Deepwater Horizon oil spill in the Gulf of Mexico. In addition to being a licensed Certified Public Accountant in the State of Texas, Mr. Sarsfield is also a Certified Valuation Analyst, Certified Fraud Examiner, and is Certified in Financial Forensics.
Mr. Sarsfield has presented to attorneys, CPAs, and professional associations on various topics, including forensic accounting and fraud investigation, business interruption, corporate ethics, and the quantification of economic damages. He also serves on the Business Valuations, Forensic, and Litigation Services Committee for the Texas Society of CPAs.
Ryan Reneau is the Executive Vice President of Special Projects for Entoro, LLC, the parent company of a leading group of financial services companies that provide investment banking services, wealth management, and strategic advice. Kicking off in 2016 with the acquisition of Offerboard, LLC, the group has been actively growing through acquisitions and joint ventures as well as organically. In his role, he has negotiated both initial deal terms and resolution of post-deal disagreements resulting from contractual ambiguities.
Mr. Reneau also practices law with Chamberlain Hrdlicka as Senior Counsel, where he focuses his practice on international tax planning, corporate structure optimization, and transaction efficiency. He applies a holistic approach to tax planning that balances immediate cash tax consequences, financial statement implications, and long-term positioning for the future. He has counseled a broad range of publicly traded and privately owned clients as both an external advisor and in-house team member.
Prior to his current roles, Mr. Reneau worked as a senior manager within the tax group of a multinational corporation leading the tax accounting and quantitative analysis functions. He has also worked with a Big Four accounting firm in the international tax services practice. He is licensed to practice law in the State of Texas, a Certified Public Accountant, and Charted Financial Analyst charterholder.
Mark Hamzat O. Erogbogbo | Host | Master of Ceremonies | Organisor
Chairman Energy & Natural Resources Special Interest Group | The FENG
Chairman Private Equity Special Interest Group | The FENG
Chairman Capital Markets Special Interest Group | The FENG
Advisory Board Member | American Association of Petroleum Geologists
Chairman | North American Explorationists | Houston Geological Society
Director | Society of Petroleum Geologists | Investments & Finance
Advisory Board Member | www.careergearhouston.org
Board Member | www.getmoneyforyourmission.com
Managing Partner | www.ProsperoOG.com
Managing Partner | www.assetbeta.com