Structure
Decks

SUMMARY

A structure deck, or steps plan, is a presentation detailing the exact actions needed to achieve an agreed-upon transaction structure.

A well drafted steps plan should begin with the pre-closing structure, conclude with the post-closing structure, and detail—step by step—how to move from one to the other.

AUTHORSHIP & VETTING

Accountants or lawyers usually prepare the first draft, or the strawman proposal.

No matter the author, all parties to a transaction should thoroughly vet and definitively sign off on the steps plan prior to its implementation. This includes pre-closing reorganizations like those undertaken so an equity transaction can be treated as an asset transaction for tax purposes.

MULTIPLE DECKS

There may be more than one steps plan for a single transaction.

For example, if a buyer is bringing in third-party debt or co-investor proceeds, there may be separate decks for each of these financing sources in addition to the main transaction’s plan.

PITFALLS

Common pitfalls include:

• omitting key steps or being imprecise;

• signing off on steps while brackets or questions remain outstanding;

• not finalizing the plan prior to its implementation (in straightforward terms: no action whatsoever until all details are confirmed and all brackets removed); and

• over-sharing (e.g., a seller likely should not receive a copy of a steps plan prepared for a buyer’s co-investors).