Hard Conversations: M&A Negotiations

January 25, 2023

In this episode, we share the story of a physician who was approached by a large private equity firm seeking to acquire his practice. ByrdAdatto partner, and series regular, Jay Reyero joins us to discuss how to navigate unsolicited offers, and the hard conversations that can happen throughout an M&A deal.

Listen to the full episode using the player below, or by visiting one of the links below. If you have any questions or would like to learn more, email us at info@byrdadatto.com.


Intro: [00:00:00] Welcome to Legal 123s with ByrdAdatto. Legal issues simplified through real client stories and real world experiences, creating simplicity in 3, 2, 1.

Brad: Welcome back to another episode of Legal 123s with ByrdAdatto. I’m your host, Brad Adatto with my co-host Michael Byrd. Now, Michael, tell the audience, what do we have in store for them per Season 11 theme?

Michael: As a business and healthcare law firm, we meet a lot of interesting people and learn their amazing stories. As you know, this season’s theme is hard conversations. We’ll take real class stories and of course, scrub their names to protect confidentiality, and these stories will be built around confronting and having hard conversations. They don’t all have great outcomes, but there are plenty of teachable moments.

Brad: Absolutely. Now Michael, it’s hard to believe, but today we are actually leaving for Las Vegas.

Michael: Whoop Whoop!

Brad: For the 2023 Medical Spa Show. On our previous shows, we have discussed actually playing [00:01:00] Texas hold ’em. So a little bit of gamble talk, but as we leave for Vegas, I thought we should discuss some of the other card or table games that they have there. Do you have a favorite game that you play in Las Vegas?

Michael: Well, believe it or not, my favorite still is Texas Hold’em, but I don’t have the patience anymore. You usually have to wait in line to get a seat at the table.

Brad: Oh, yeah.

Michael: And then you can’t be in a hurry to play hold ’em or you’re going to lose.

Brad: Yeah.

Michael: You gotta be patient, and so my backup is blackjack. You can always jump on a table and play whenever.

Brad: Yes.

Michael: How about you?

Brad: Yeah, same. As you know, I’m not as big of a card shark as you are, so I don’t often gamble when I’m in Vegas, but when I do gamble, I have played blackjack. In fact, the last time I played blackjack, you were seated at the table with me. I may have had a couple of colder beverages than you, so I was really enjoying it, whooping it up with some of our other team members and laughing and having fun, and all of a sudden I get a tap in my shoulder and you’re like, Hey [00:02:00] man, you gotta go. I was like, what did I do? Like I thought I’d actually offended somebody. He’s like, you’ve lost four hands in a row. I was like, what? He’s like, yeah, the table’s cold, let’s go. I was like, you do that, you’re like, yes, when the table’s cold you leave. Meanwhile I’m thinking like, all those nice people in Las Vegas, they want my money, Michael. I was trying to give it to ‘em.

Michael: They really liked you.

Brad: Yes, they really, really were nice to me for some reason because apparently I was really good at giving ’em four hands in a row of my money, so thank you for that. Riley, you can delete that. I don’t want anyone to know that I thank Michael for anything.

Michael: Yeah.

Brad: Well, today, Michael, for our audience that’s watching us on our YouTube channel, they notice that right next to you is our podcast regular and partner, Jay, who is often called the smartest guy at ByrdAdatto. Welcome back Jay. Now Jay, since we’re talking about card talk or Vegas talk, do you have any table games or card games you like to play in Vegas?

Jay: Well, Brad, you are asking probably the wrong person that question. I’ve been to Vegas a [00:03:00] handful of times, all of which were for work related, speaking at conferences. I think I’ve sat down at a Vegas table exactly once. It may have been the same story with you, and I promptly donated all my chips and I think what was mathematically the least amount of hands I could have played and it was blackjack, so not a good expert in this subject matter.

Michael: You’re exercising your smartness. I like to hear that.

Brad: Yes, that actually is exactly right, Michael. Well, there are so many games in Las Vegas between the card games and table games, and I know that some people really love the slot machines. I don’t get it, but there is all these different casino table games, and it seems like the game that the most excitement’s always happening is at the craps table, but it seems kind of intimidating to me at the same time.

Michael: Oh yeah, and it’s like its own little ecosystem when you see it because it’s a community game.

Brad: Yeah.

Michael: Everyone’s together and it’s all the players against [00:04:00] the house, and so, yeah, it’s a very exciting game, but you feel like an outsider when you watch it. Let me give some context for those who don’t know crap, I’ll tell a little bit more about crabs. It’s a dice game in which the players bet on the outcome of a role of a pair of dice. Players can bet with the players, so that’s all the whooping and hollering or they can actually side with the house. Those people are not as popular.

Brad: Yeah, I bet.

Michael: That would be you, Brad.

Brad: Oh, okay.

Michael: I’m just kidding. You would of course be betting with all the players.

Brad: Yes. 

Michael: As you might suspect, betting with the house is actually better odds, it’s just not as fun. The players have these two six-sided dice and they roll ’em and they count the numbers together that influences all this craziness that happens on who can win each time there’s a roll of the [00:05:00] dice.

Brad: Yeah, it’s fascinating. When you go there, you see all these people around this table, and then you go look at the table, and then the table itself is fascinating because on the table closest to where the dealer is, so there’s a dealer, actually, there are a lot of dealers around the thing. But you can place bets and in the middle they have something called the combat, and then they have the field bet, and then underneath those, the closest to the players, you have the pass line and of course the don’t pass line bets, and finally you have the hard line bet, which is the center table. Michael, I got to know, or I guess the audience probably cares more than me. Have you ever bet on a crap table?

Michael: Well, I have once, and it was a Jay Reyero type experience. I guess, I was smart enough, but the very first time I went to Vegas, I was in college and I had $200 with me to bet that night. It was just a one night all-nighter gambling experience.

Brad: No hotel.

Michael: $200 was all that I had and I got with my friends and put $200 into chips and with [00:06:00] in five minutes, my $200 was $800. I had no idea what happened. Within 10 minutes I had zero. I was like, I don’t understand this game, but I do not like it.

Brad: Well, according to the experts, the easiest way to really think about this game of crabs is really just about the rolls and the dice. So the first role in the game of craps is known as the come out role, and the shooter can either win or lose on that role, or it can set a point. I tried to start figuring out the details for this podcast, and as I got more into it, it’s so complicated that I quickly didn’t realize how many different things there are. As you were kind of talking about earlier, there’s a player rolling the dice, and then all these people around that player can participate in the outcome of that role. What I found out is there’s 36 different types of outcomes on that role.

Michael: Wow.

Brad: So every single time, and to your point earlier in shocking news, the house has the mathematical edge on the [00:07:00] prediction basically across the board, which is again, why the casino, I guess loves it. They basically have a higher chance of winning, otherwise. Jay, I guess we know the answer, but you’re a super smart guy. Have you ever figured out craps in general?

Jay: I have.

Brad: Oh!

Jay: You stand at the end of the table, it’s a long table, you dress really nice, you have a drink in your hand, I have my beautiful wife next to me.

Brad: Okay.

Jay: She blows on the dice. I throw it. I win. Everybody screams. I mean, that’s what the movies taught me.

Brad: Is it a slow motion roll, Jay?

Jay: Yes, and you see the dice tumble nice and slow, and then it stops, and it flips over and then everybody screams and goes wild, and I walk out a winner. I mean, it’s everybody’s experience, I thought.

Brad: Yes, obviously.

Michael: That sounds exactly right. Yeah, there’s a lot of luck and superstitions that are involved.

Brad: Yes.

Michael: You get a hot hand on the crap table.

Brad: Yes, I read a lot about that.

Michael: As much as I’d love to keep this casino talk going, I think we need to get into the [00:08:00] hard conversation today.

Brad: All right, so our client in this story, we’re going to call him, Dr. David.

Michael: Wait, Brad, we’re not supposed to use real names.

Brad: Don’t worry, audience members and Michael, this is not his real name. Let’s go a little bit further in the story, giving you some more contact as to why we use this name. For our audience, Jay, why don’t you just set that scene for everybody?

Jay: Sure! So, Dr. David, he’s a pediatric ophthalmologist, a great solo specialty practice. He’s been in practice for almost 30-plus years, and isn’t looking to retire or sell his practice. Things are humbling along really, really nicely. In fact, during this story, at one point on our very first call with us, he basically told us he didn’t need any money to retire. He was happy, everything was going well, but the path he was about to go down, was interesting to him. He just wanted to see how it would play out.

Michael: Sounds like an ominous [00:09:00] setup.

Brad: Well, good, Michael, you’re paying attention. That’s good. Well, that’s where our second character of the story comes in. Dr. David was approached by this large private equity back group, as Jay was saying, that actually acquires medical practices, and they were focused in the pediatric space. We’ll just call this new character, Goliath. Goliath makes this unsolicited offer to purchase Dr. David’s Practice.

Michael: Are you going with Dr. David as in David versus Goliath type story?

Brad: You know, Riley, I have been telling everyone that Jay’s the smartest guy in the firm. Good job, Michael.

Michael: I’m a master…Okay, well, back to the story of Dr. David. Was there a letter of intent involved with this unsolicited offer?

Brad: Yes, but by the time Dr. David brought us in, he had already signed it. We have discussed in details in other episodes, the traps are simply signing a letter intent. I know in season seven we had the red flags episode, non-binding letter of intent. In this case it wasn’t as catastrophic [00:10:00] as it could have been, but definitely put some effect on the road. Before we get to that, Jay, do you remember Goliath’s first impression?

Jay: Oh, man, how could I not? What a first impression. After the LOI was signed, the first document that Goliath sent to Dr. David was his post-sale employment agreement. The fun part was in the message to Dr. David they wrote in the email that, Hey, this is a fairly standard agreement that they had signed with over a thousand physicians, so they don’t accept many changes. As you can imagine, this nice little simple declaration on the very first email to him when the LOI was signed, gave Dr. David a lot of concern.

Brad: I’m surprised they didn’t see a million.

Michael: I know. Well, I mean, clearly they, they were going with the peer pressure technique on their negotiation strategy.

Brad: That’s a good one, Michael. Well, so you know, Michael, certainly after that, the employment agreement started coming through and then [00:11:00] they provided the purchase documents for us to review. And as far as these things go, it was a pretty standard comprehensive, as Jay and I would say, asset purchase agreement. Jay and I reviewed all the agreements and we provide a lot of good feedback to Dr. David on our comments and obviously our concerns, the pros and cons to each piece of this and Dr. David had also taken the time, which is good for him, by the way, audience members to actually review the employment agreements and identify issues that were of concern to him. Over the next couple weeks, we had lots of calls with Dr. David to really go through the documents, streamline what his concerns were, and then start making the changes needed.

Jay: Yeah, and, Brad, if you go back to the reference to the LOI, at the very beginning, during these conversations, during this period, Dr. David had one overarching question that he was really focused on, and that was why was this transaction changed from a stock sale to an asset sale? And you and I were looking at each other thinking, what is he talking about?

Brad: Yeah.

Jay: And what we found out was, he was talking to all the business people and he was being [00:12:00] told by the business people “yeah, this is a stock sale, this will be a stock sale”. So when he was considering the purchase price and at the end of the day, what he was going to take home and the impact on him, he was evaluating it from a capital gains perspective. He started asking Brad and I, “Hey, you know, what does this mean from a tax perspective, changing it from stock to asset?” And you know, we’re not tax guys, so we’ve said, “Hey, go talk to your CPA to figure out, you know, what does this mean to you from a tax impact”.

Michael: What did he find out?

Jay: So he found out that the switch was actually going to cost him about an additional $40,000 in taxes. So, when he started running the numbers, he was going to take home a lot less than what he had originally expected. Now that purchase price didn’t seem as attractive. Unfortunately, he signed the LOI and so it wasn’t really practical at that point to try to renegotiate that purchase price.

Brad: Yeah, and at this point, Michael, the language and the LOI really indicated, if you go back and look at it, it didn’t really say it was a stock sale or an asset sale. It was talking about purchase agreements, really. But I think [00:13:00] as Jay said, he was under the impression, based on all the calls, it was going to be a stock sale. Of course, given the court practice of medicine in Texas, this group was actually not based in Texas and all the transactions and natures of those kinds of structures. I think they ultimately ended up correctly addressing it. It would’ve been nice to have known that in the beginning because we could have actually walked him through the whole MSO model if that’s what they wanted to do. That would’ve given him the ability to renegotiate the purchase price prior to signing the LOI and put a better position for him, especially the tax impact in the long run.

Michael: You could have flushed your CPOM neck tattoo during LOI negotiations if they’d have brought you in. I get it.

Brad: Yeah.

 Michael: Well, okay, now we’re in, so let’s get to the negotiations. I’m assuming you made changes to the documents and sent them over to Goliath. How did they respond?

Jay: Very similar to that initial email with the employment agreement and you know, it’s something I think we’ve all run into from time to time. Basically, when they sent us back their comments to our changes, they basically said [00:14:00] something to the effect of, “You know what, these are our standard documents and we have done thousands of these deals and do them all the same”, and they weren’t as bad as the ones that I’ve gotten before where they claim that these have been reviewed by thousands of attorneys without any changes. Those are my favorite. I want to know where they work. It was again the same. We don’t make changes, and they were, definitely throughout this process, kind of conveying their reluctance to entertain any of our changes is very much,”Hey, we’re going to take it or leave it. We do these deals all the time”.

Michael: They were doubling down on the peer pressure technique. Got it. Okay, well, so even with that, did you end up basically rewriting their agreement?

Brad: Yeah, absolutely not. I mean, there were definitely some aggressive changes we may have made, and we’ll say hopefully some of these changes requested, we really did think was the best interest of Dr. David. Although, we expected some pushback no matter what, because obviously one of the things you want to do is you want to see if they’re even [00:15:00] interested into that. It can’t hurt the try, and most of that was really concentrating the asset purchase agreement as far as the heavy lifting. But the employment agreement, there were some aspects of it that they kept saying was the unchangeable document because a million, billion physicians that they had, had already signed this. So, we looked at it and we felt like these were very reasonable requests because they were simply just trying to match what Dr. David’s expectations were. And some of this was based on conversations he had with the Goliath business people as to why he wanted to join them.

Jay: I mean, it’s not uncommon, this was an employment agreement where the employer really controls everything. Yes, Dr. David was going too technically become an employee after the sale, but it was still going to be essentially his practice that he would be running. He really, really wanted to make sure that it was going to run and more specifically, how he was going to be required to [00:16:00] work wasn’t going to change. He was just going to basically, you know, do this transaction and from the day before to the day after, nothing was really going to change. If you remember, he has no reason or plans to sell, so it was really important to him that there was no ultimate change to the way that he practiced.

Michael: All right, well, what happened next?

Jay: So they sent us back the documents and essentially they rejected most of our changes.

Michael: Shocker.

Jay: The best part though, I think this is my favorite, is the ones that they did accept to these unchangeable documents. I use the term accept loosely. They told us that they didn’t accept them, and that they accommodated the changes they could within the structure of their template agreements.

Brad: I love those quotes.

Michael: Spoken like a true lawyer.

Jay: It was very nice of them to accommodate us. They also, in the same email, again, shared the statistics of how many physicians and acquisitions they had done, just in case Brad and I had forgotten.

Brad: Yeah, it’s always great when they tell us that they’ve done a [00:17:00] billion of these. By the way, that’s one of my favorite lines. “Well, all these other attorneys looked at it and they had no problem with it”. Look, if they want to have malpractice claims, that’s good for them. As you can imagine, we’re pretty far along now, and Dr. David was not too happy. So after that, we had to have our first of many conversations with him, really to identify what were the issues that we had a change. Like, what could you live with? You know, that was what we were trying to figure out and what were the no-GOs and the things that must change. In other words, for him, what were the deal-breakers that we had to really push back on? And that helped us actually build our roadmap over the next several months as to which direction to push back

Michael: What do you mean by that?

Jay: Yeah, so the negotiations on this one actually went almost past six to seven months. Now there was a long period of delay in there where Goliath disappeared, but we actually thought and talked to Dr. David that maybe our [00:18:00] pushbacks were rubbing them the wrong way and they were getting cold feet, if you will. It did progress slowly over this period of time. There were a bunch of ancillary documents that, again, every time they sent us a new document, it created a new concern for Dr. David, especially with this kind of drip campaign that he felt like was bringing up new surprises. Same as before, every time we talked about the changes or any of the documents, they were reluctant to agree to anything. They were their template agreements. Everyone’s done them before, and so continuing on to have these conversations with Dr. David, explaining the situation and, again, identifying what were the wants, the deal breakers, the things that we could go ahead and agree to. We were still dealing with the employment agreement. All those things that had been brought up from the very beginning to this unchangeable document that still was important to Dr. David, we were still dealing with those issues at this time.[00:19:00]

Brad: Yeah, and then eventually it happened from the very first email, as Jay said when they made the giant Declaration of War, which is we never make any changes. We lot of back and forth with them on certain key terms and conditions, and they just weren’t really reluctant to really entertain us at all. As you can imagine, the legal fees for him and the time and effort that he was putting in to really trying to figure out what to do with Goliath. Dr. Dave really just had enough, and when Goliath refused to greet any remaining of these deal breakers, he was left with the option of signing an agreement that he didn’t like.

Michael: Was this where you had the hard conversation?

Brad: Dun, dun dun. Yay Michael. Yes, it is time for Dr. David to actually put on his big boy pants and have that hard conversation of what’s the deal worth to him. Right? We had to counsel him through all these pros and cons and [00:20:00] we had this quote, “final deal offer” in front of us and we reminded him as to what was the ultimate outcome if he did sign and execute these final agreements.

Michael: What happened after this hard conversation?

Brad: Well, actually, Dr. David, instructed us to terminate the discussion and inform Goliath that he was not going to sell anymore, and that he was done messing around with them. So we called up Goliath council and gave him the heads up that we would be saying to him the termination to the deal, you know, whatever the LOI required. The council on this side was actually stunned for a second. I mean, there was a serious pause before he responded and he goes, “But it’s over $3 million. How can he walk away?” And we told Goliath’s counsel, “well, he doesn’t really need the money to retire. Goliath, you guys want him more than he wants the deal that you’re giving him, so we’re walking.”

Michael: You know, one of the hardest of hard conversations is actually the simple word of no. So it sounds like he did [00:21:00] that. Was that the end of it?

Jay: So, actually no. About a month after we told them, “Hey, we’re done”. Goliath came back and agreed to accommodate the deal-breaking issues we had been requesting. They came back and said, “You know what? The deal’s back on and we’ve agreed to them”. Over the next month, Brad and I worked to finalize all the documents. We closed the deal, and at the end of the day, Dr. David was happy with the outcome, even though it had been a pretty long road.

Michael: I have a legal disclaimer: This is of no way any admission of any guilt, accommodation, or negotiation, but yes, we’ll give you what you want. Well, okay, let’s go to break and talk about some of the lessons to be learned from Dr. David’s story.

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Brad: Welcome back to Legal 123s with ByrdAdatto. I’m your host, Brad Adatto with my co-host Michael Byrd and our podcast regular, Jay Reyero. Now this season’s theme is hard conversations. Now, Michael, Jay, and I just completed a great summary of how a prolonged M&A negotiation can go in lots of different directions.

Michael: Yeah, I mean, Dr. David was minding his own business, living his life, and he gets an unsolicited offer, doesn’t call us, signs an LOI, but then things start getting on track, quickly finds out that Goliath doesn’t negotiate, you just take it and you will like it, that was their [00:23:00] approach, and that plays out for a long story until the very end where the big hard conversation comes into play. Dr. David’s like, “No, I’m not going to take it.” It was a take it-or-leave it moment. And he said no, and that really shocked them, and so he ended up getting the outcome he wanted. Jay, this story brings to mind something we’ve talked about before when it comes to a mergers and acquisition deal.

Jay: Yeah, when we’re talking about an M&A deal, our partner Jim Stanford always reminds us that one of the key things to keep in mind is that the best leverage in a deal is the ability to walk away. I think you see that throughout Dr. David’s story. Here was someone who wasn’t looking to sell, wasn’t forced to sell, there wasn’t a need to sell, and this really afforded him the ability to fight back and push back on a lot of deal terms that were real sticking points to him [00:24:00] because there was no fear of the buyer walking away. Would it have been disappointing if they had? Sure, absolutely. In the end, he would’ve been in the exact same position as before. He was running a successful practice; things were going well, there really wasn’t any downside. He really could fight for that, knowing that he had nothing to lose.

Michael: Yeah, it’s an easy thing to say, and when we borrow a phrase from one of our favorite podcasts, Smartless, on that ability to walk away, we call it sexy indifference. What does that mean? Well, I kind of think of it like a state, like Zen. You can’t just deem yourself to have sexy indifference; you’ve got to work to get to that point where you truly have the ability to walk away. The sexy part, I mean, Brad will tell you on the show that he’s sexy, that doesn’t count. You have to actually do all the things, whether you’re the buyer or the seller, to be [00:25:00] desired in the deal. We’ve talked many times at the beginning of getting your house in order and getting things going.

Brad: Yeah.

Michael: But even in the deal itself, how you communicate throughout these long negotiations can help foster the desire that they would still have to own your business or sell the business. Then on the indifference side of things, that gets to that managing your emotions side of things. When people are buying a house, and if you start mentally moving in…

Brad: Oh yeah.

Michael: You’re done. It’s over. So, you have to manage your emotions. If you’re selling your business and you start spending the money that they’re offering, you’re done. You don’t have that ability to walk away or that ability to convey the state of sexy indifference, and so you are constantly working to get to this [00:26:00] point where you have other options if it happens and if it doesn’t happen. For Dr. David, it was easy because he wasn’t looking to sell. He was perfectly happy. It’s a great example of what that looks like when you can just turn around and walk away from that check at the very end, to even shock someone like Goliath.

Brad: Yeah, and I think for our audience members, I agree with a lot of things you’re saying and that he didn’t get everything he wanted. He really did have to narrow them down. I’ll talk about it in a second, but this is over nearly a year process where Dr. David had several starts and stops and ups and downs negotiating this agreement, and we could never tell how committed either party was actually to this deal. I mean, remember this is an unsolicited offer and Dr. David had moved further enough forward during this deal. He spent hours on his personal time. Remember he was a one man shop, so he was providing all this stuff. He actually had to hire attorneys and spend money on them to get the deal, that at this [00:27:00] point, he was not happy with. Many of our clients have been put in this exact same position and may have already, as you said, Michael, already mentally or actually spent the actual money there when he get at closing. When push comes to shove, the ultimate cave to what Goliath demands in this case, these are not easy conversations. Dr. David understood our reasoning, and even though there was some doubt because when we’re dealing with Dr. David, Goliath’s, like ah, this is how we always do it. We felt like these were reasonable requests. Luckily for us and luckily for him too, he ultimately trusted the process that we were trying to push him through and his attorneys, and realized that he was not getting the deal he wanted.

Michael: You touched on a great point, and that was Dr. David being grounded in reality and being realistic along the way. I think that’s a big part of keeping your sexy, sexy. [00:28:00] That is if you start asking for the moon and it’s unrealistic, you’re not going to be sexy anymore.

Brad: Yeah.

Michael: I had a recent deal that closed and my client was kind of coming in at the last minute. He did have a ton of leverage and had the ability to walk away, but at first I had to have a lot of conversations with him because he was wanting to ask for the moon. Part of it is like, look, I mean, you’re kind of a passenger to this deal. You are going to come in and blow up things that have been negotiated for six months, so you got to kind of accept what you have to accept and if you can live with that then that’s where you can really go for it on the stuff that’s negotiable. He was able to stay sexy throughout, and got a really good outcome. Jay, what are your final thoughts?

Jay: Yeah, so, kind of [00:29:00] zooming back out to the theme of hard conversations, M&A, there are probably many points that we have many hard conversations. Different aspects of it, and one of the first ones I always deal with is kind of on the front end going to your point of, what’s the expectation of the m and a process. Sometimes people get in and they don’t really understand the five phases and they think it’s just a simple process. It can be done in 30 days. I like to set the table by having this conversation, which is hard. Many times at the very beginning to kind of set the stage as to what to expect, how we approach it, how we navigate it together, so that we’re really kind of going in eyes wide open as to, okay, where are the places that we’re going to potentially face resistance or push back? And it also gives me an opportunity to understand from the client, where do you want me to fight? Going to your point, what are the deal breakers, the issues? And if they think that there are certain places where they have that, and I tell ’em, well, that’s just going to blow up the deal. We have to have that real hard [00:30:00] conversation. I kind of have a similar analogy to a race, right? We think about the post-race snacks and the t-shirt and the metal and the post-race beer before we ever run it, then yet there’s me.

Brad: That’s the best part, Jay.

Jay: I know that’s the best part, but you also then have to get out there and run the 13.1 or the 26.2 miles to actually get to that point, and you want to inform the client, but I don’t want to also kill their excitement. It is a process and so that hard conversation is typically at the very beginning just to make sure that they’re well aware and we can kind of build out strategies to get through the process.

Brad: Yeah. All great points. For our audience, when you had this opportunity, either enter a sale or a purchase of a practice, understand good council sometimes should slow the deal down to make sure that there is the alignment that Jay was talking about, between the parties or as Jay said the buyer, the seller has eyes wide open as to what’s going to happen after closing. And we talked about this little in another episode about [00:31:00] having a plan A and plan B and earlier this season, but the concept should be if you are going to sell or if you are going to buy, as Michael said, have some ground rules as to what you want to happen and then you should carve out time before the sale to plan this action. So as you progress and you start getting the negotiations and certain circumstances happen, you at least have a clear path for you to follow depending on what happens with that deal. Michael, we are getting close to ending this episode, so what final thoughts do you have?

Michael: Well, all this actually connects back to your little story about us walking away from the blackjack table. I mean, you were emotionally connected to the love that the casino was giving you and the free drinks were giving you, but the ability to know, “You know what, if I lose several hands in a row, it’s time to get up”. And go away from the cold table. It’s very similar to the hard conversations that go into an M&A deal or the [00:32:00] hard decisions that go into an M&A deal.

Jay: So, you just said Brad’s not sexy?

 Michael: Pretty much.

Brad: Riley, cut all that. Well, Michael and Jay, that’s all the time we have today. Michael, can you believe we’re going to Vegas in a few weeks to have a live show?

Michael: I’m getting ready.

Brad: Yeah, so audience members, February 4th, we’ll be at the 2023 Med Spa show. We’ll be live, and Michael, should we break through this payola jar and use some of those earnings that we’ve made to go gamble?

Michael: Yeah, I mean, I don’t know. Will they take a dollar bet?

Brad: I don’t know. Is that all we have? We gotta do better than that. All right, well audience members do not panic. We are back next week and we will be having hard conversations about selling your medical practice to young associates.

Outro: Thanks again for joining us today and remember, if you like this episode, please subscribe. Make sure to give us a five- star rating and share with your friends. You can also sign up for the ByrdAdatto Newsletter by going to our ByrdAdatto.com. ByrdAdatto is providing this podcast as a public service. This podcast is for educational [00:33:00] purposes only. This podcast does not constitute legal advice, nor does it establish an attorney-client relationship. Reference to any specific product or entity does not constitute an endorsement or recommendation by ByrdAdatto. The views expressed by guests are their own, and their appearance on the program does not imply an endorsement of them or any entity they represent. Please consult with an attorney on your legal issues.

ByrdAdatto attorney Jay Reyero

Jay D. Reyero

Jay has mastered the art of communication, leaving clients with both an understanding of their business risk and the path to solution.

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