Bank Financings

Corporate Governance and Compliance

Executive Compensation

Internal Investigations

Mergers and Acquisitions

Private Equity and Venture Capital

Securities Offerings

Special Committees

MTO’s corporate practice combines the sophistication and resources of one of the country’s most prestigious full-service law firms with efficiency and responsiveness to the client's business needs.  And these advantages allow us to offer our clients custom legal solutions and professional project management in a uniquely efficient and cost-sensitive manner.

That’s why Warren Buffett, who seeks value in his legal services as well as in his investments, looks to MTO for all of Berkshire Hathaway’s significant acquisitions and securities offerings. 

Our many long-standing, collaborative relationships with clients like Berkshire have given us a keen appreciation for the difference between “zero risk” answers and “right risk” solutions that meet the practical business needs of individual clients.  Every one of our attorneys, from the most junior associate to the most senior partner, practices in a number of different areas, giving us the broad range of experience necessary to act as true counselors, with an ability to see both the forest and the trees.

Our client base is remarkably diverse, consisting of Fortune 100 corporations, influential business people, and numerous large and small companies from around the world.  We regularly represent public and private entities engaged in a wide variety of activities, including many of the most important names in California business, such as:

• City National Bank – the largest bank headquartered in Los Angeles
  
  
• Edison International and Southern California Edison – one of the largest investor-owned utilities
  
  
• International Creative Management – one of the world’s largest talent and literary agencies
  
  
• KB HOME – one of the largest homebuilders in the country
  
  
• Oaktree Capital Management – a Los Angeles based investment management firm
  
  
• United Talent Agency – a top Hollywood talent agency
  
  
• Universal Music Group – one of the world’s largest music companies
  
  
• The Yucaipa Companies – a leading private equity firm

We have developed particularly productive relationships with many of our clients because we handle everything from their routine day-to-day matters to their most important “bet-the-company” transactions.  Our specialty is “one of a kind” or “first of a kind” deals, like Berkshire Hathaway’s issuance of the first security with a negative interest rate and the recent disposition of Edison Mission Energy’s worldwide power generation holdings, including its 14 electricity generating projects located in Europe, Australia, Asia and Puerto Rico.  Additionally, we represented News Corporation in connection with the restructuring of the management of Gemstar International and the unwinding of a complex voting and control arrangement between News Corp. and Gemstar’s founder.

For additional information regarding our corporate practice, please contact Robert Knauss (213) 683-9137, Michael O’Sullivan (213) 683-9525, Sandra Seville-Jones (213) 683-9126, or Mary Ann Todd (213) 683-9520.

Bank Financings

We represent borrowers and lenders in secured and unsecured bank financings and refinancings, including acquisition financing transactions and transactions with unusual structuring characteristics.  Our clients in such transactions include Southern California Edison Company and its parent Edison International, KB HOME, Mobile Storage Group, Alliance Entertainment Corp., Henry Company, 101communications and BH Finance, a Berkshire Hathaway subsidiary that is an active lender in bank financings, including a $5.6 billion loan to the FINOVA Group in connection with its restructuring.

 
Corporate Governance and Compliance

We are able as a matter of course to provide counsel with respect to the requirements imposed on public companies by the Securities Exchange Act of 1934, the New York Stock Exchange, the Nasdaq Stock Market and California securities laws.  We routinely advise clients with respect to fiduciary duties, periodic reporting, proxy solicitations, Sarbanes-Oxley compliance, director independence, Section 16 compliance, the various Section 10(b) antifraud rules, Foreign Corrupt Practices Act bookkeeping requirements, and the other provisions of the federal and state securities laws.  We regularly represent, among others, Berkshire Hathaway, City National Bank, Cook Inlet Region Inc., Countrywide Financial Corporation, Daily Journal Corporation, Edison International, KB HOME, 99 Cents Only Stores, TenFold Corporation, UnionBanCal Corp., Wesco Financial Corporation and The Yucaipa Companies.

Executive Compensation

Our partner Bob Johnson is recognized as one of the leading experts nationwide on executive compensation issues.  He is the co-author of, among other things, Equity Incentives: Strategic, Tax and Other Issues Surrounding Plan Design, 44th Annual Institute on Federal Taxation (1992).

Some of our more high-profile representations include Brad Grey, in connection with his becoming President of Paramount Studios, Jerome York, the former chief financial officer of IBM and of Chrysler Corporation, in connection with his becoming Vice Chairman of Tracinda Corporation, Ken Moelis, in connection with his departure from Credit Suisse First Boston to become Head of Investment Banking, Americas, for UBS Warburg, and Michael Ovitz, in connection with his becoming President of The Walt Disney Company.

Other representative clients in the executive compensation area include Avery Dennison, GenCorp Aerojet, General Dynamics, Management Compensation Group,
Mellon Bank, Northrop Grumman, Occidental Petroleum and SBC.

 
Internal Investigations

We are often called upon to represent audit committees and special committees in connection with investigations of possible financial fraud, corporate wrongdoing and the like.  These representations usually include extensive document review, numerous interviews and thorough analysis of the potential legal issues.  In many cases, these representations involve interaction and negotiation with the U.S. Securities and Exchange Commission or other regulatory agencies.  Because the matters in which we have been involved are often not publicly disclosed, we cannot identify many of our representations in this area.  By way of example, however, we’ve recently investigated options backdating questions in a number of companies, charges of management fraud made by a company director and, on numerous occasions, the circumstances surrounding earnings restatements.  We also recently conducted a top-to-bottom review of a company’s compliance procedures following a change of control.  Additional representations have included:

• Boards of Directors of Salomon Inc. and Salomon Brothers in SEC and other regulatory investigations arising from U.S. Treasury securities market activities.
  
  
• Audit Committee of the Board of Directors of Waste Management in reviewing aspects of the corporate activities that were the subject of an investigation by the SEC.
  
  
• Directors of COHR in investigating claims of financial irregularities at the company, and in making necessary changes to COHR’s corporate governance structure and management.
  
  
• Special Committees of Outside Directors of Tenet Healthcare in connection with claims of potential financial irregularities.
  
  
• Special Committee of the Board of Directors of Digital Courier in investigating and reporting on details of an offshore transaction in which the company issued a majority of its outstanding stock in a merger.

Mergers and Acquisitions

We have engaged in a variety of M&A activities, from public tender offers to private and public negotiated acquisitions, serving as both deal and special counsel to the company and to the board.  Some of our recent M&A engagements include representations of:

• Berkshire Hathaway in its $22 billion merger with General Re Corporation, one of the world's largest reinsurance companies, and in numerous acquisitions of publicly traded companies, including Clayton Homes, Russell Corporation, Johns Mansville, XTRA and Shaw Industries.  We represented Berkshire in several acquisitions of private companies such as ISCAR, PR Newswire, Applied Underwriters, McLane Company, Pampered Chef and U.S. Investment Corporation.  We also represented Berkshire in the acquisition out of bankruptcy of Oakwood Homes Corporation and Fruit of the Loom.
  
  
• The Chandler Trusts, the majority shareholder of The Times Mirror Corporation, in negotiating and structuring the $8 billion sale of Times Mirror to the Tribune Company, which is the largest newspaper acquisition ever completed.  We also represented the majority shareholder of Central Newspapers (Arizona Republic and Indianapolis Star) in connection with the sale of the company to Gannett Co. for $4 billion.
  
  
• Edison International and Edison Mission Energy in a global auction of 14 electricity generating projects and a control interest in a large New Zealand public company.  Cash proceeds to EME totaled $2.85 billion, and the buyers assumed more than $4.5 billion of debt.
  
  
• Fisher & Paykel Appliances, a large publicly traded New Zealand company, in connection with a series of acquisitions and investments in U.S.-based businesses.
  
  
• Henry Company in connection with an auction and sale of the company to a financial buyer for cash and equity securities, including a tax-free rollover by certain shareholders.
  
  
• J.D. Power & Associates and Power Information Network in a highly competitive auction process and their ultimate sale to The McGraw-Hill Companies.
  
  
• KB HOME in numerous acquisitions of homebuilders, including its acquisition of Colony Homes, Dura Builders and Zale Homes, and in the sale of its multi-family housing division to Simpson Housing.
  
  
• Oaktree Capital Management in strategic investments in private companies.
  
  

• The Price Group and Sol Price, the controlling stockholders of Price Legacy, Inc., in connection with the $700 million sale of Price Legacy to a group led by DRA Advisors and Kimco Realty.
  
  

• Universal Music Group in its acquisitions of DreamWorks Records and Interscope Records, and in its sale of Pressplay (now Napster.com), an online music subscription service.  MTO has also represented Universal Music Group in a series of strategic investments in technology companies and in the formation of new record labels with marquee talent.
  
  

• Universal Studios (as special counsel to Vivendi Universal) in connection with the sale of Universal Studios to NBC and in its prior combination with USA Networks.  We also represented Universal in several transactions relating to the restructuring of its international distribution network for film and home video.
  
  

• The Yucaipa Companies in a series of acquisitions and strategic investments of privately held and publicly traded companies, including the recent acquisition of 20% of AmeriCold Logistics.  These transactions also include the initial private acquisition of Alliance Entertainment Corp., representation of Alliance in several subsequent M&A deals and, finally, representation of Alliance in a public merger with Source Interlink.

 
Private Equity and Venture Capital

We represent a variety of private equity fund sponsors in connection with the formation of their investment vehicles.  We then act as counsel to the funds in their portfolio investing, and often become counsel to the portfolio companies themselves.  Representative private equity fund clients include:

• Ares Management in evaluating private investment opportunities and in the formation of a hedge fund with both domestic and offshore components.
  
  
• Arcturus Capital in the formation of a venture capital fund.
  
  
• Himalaya Management in the creation of its second venture capital fund and in negotiating all of Himalaya’s venture capital investments.
  
  
• Klein Financial in the formation of a real estate investment fund targeting debt and equity investments in affordable housing.
  
  
• LL Investment Partners in general corporate matters and the formation of an Asian-focused private equity fund.
  
  
• Nogales Partners in providing general corporate advice, including the structuring of management entities, and in the formation of Nogales Investors Fund I, LP.
  
  
• Oaktree Capital Management in providing general corporate advice, including structuring equity compensation arrangements, in private placements of equity and debt interests in Oaktree Capital Management to outside investors, and in a variety of strategic private investments.
  
  
• Rustic Canyon Ventures in providing general corporate advice related to creating management entities related to the fund, in assisting in the formation of its SBIC fund, Rustic Canyon Ventures SBIC, LP, and in the structuring of a new energy venture fund.
  
  
• Saybrook Capital in its general corporate representation, and in the formation of a housing development fund.
  
  
• Seidler Equity Partners in strategic private investments and acquisitions by portfolio companies.
  
  
• Wasserstein & Co. in a strategic private investment through its U.S. Equity Partners II funds.
  
  
• The Yucaipa Companies in its formation of a family of private equity funds, including, among others, a leveraged buyout fund, a targeted development fund, and a special situations fund, and in the structuring of its alliance with CalPERS.

 
Securities Offerings

We represent issuers, underwriters and selling shareholders in a variety of equity and debt, primary and secondary, public and private financing transactions.  Some of our recent securities offerings include representations of:

• Google Founders Sergey Brin & Larry Page in connection with Google’s initial public offering.
  
  
• Jeffrey Katzenberg and other DreamWorks management in connection with DreamWorks Animation’s initial public offering
  
  
• A software development company, an internet retailer and an international business services company in the planning stages of their initial public offerings.
  
  
• Berkshire Hathaway in its issuance of more than $7 billion of fixed and floating rate senior notes and $400 million of the unique SQUARZ security.
  
  
• KB HOME in numerous high-yield and near-investment grade note offerings.
  
  
• Countrywide Financial Corporation and Countrywide Home Loans, one of the nation’s largest mortgage bankers, in connection with more than $30 billion in securities offerings since 2000, including a $675 million liquid yield option notes offering and a $500 million trust preferred securities offering.
  
  
• Southern California Edison in a $2.5 billion shelf registration and in its $1 billion debt-for-debt exchange offer.
  
  
• Unocal Corporation in its $540 million exchange offer of preferred securities of a newly created Unocal Capital Trust for existing preferred stock.
  
  

 
Special Committees

We have substantial experience representing and advising special committees of boards of directors in connection with mergers and other transactions in which there may be conflicts of interest, including “going private” and related-party transactions.  Some of our representations include:

• Special Committee of the Board of Directors of Ticketmaster City Search, in the acquisition of Ticketmaster from USA Networks.
  
  
• Special Committee of the Board of Directors of Hawaiian Air in considering redeployment of assets of the airline.
  
  
• Special Committee of Independent Trustees of Archstone Communities, a NYSE-traded real estate investment trust, in its $1.1 billion merger with another NYSE-traded REIT, in its spin-off of a business division to a new public company, and the acquisition of its external REIT management company.
  
  
• Special Committee of the Board of Directors of Pinnacle Entertainment (formerly Hollywood Park), a gaming and casino operator, in connection with a proposed leveraged buyout of the company.
  
  
• Lazard Freres & Co. LLC, as financial advisor to the Special Committee of the Board of Directors of Hollywood Entertainment, in the contested acquisition of Hollywood Entertainment.
  
  
• Special Committee of the Board of Directors of Optical Communication Products, Inc. in connection with its exploration of strategic alternatives.
  
  
• Special Committee of the Board of Directors of Authentic Fitness Corporation in responding to The Warnaco Group’s offer to take the company private.
  
  
• Special Committee of the Board of Directors of Vendare Media in connection with its acquisition of New.net from Idealab, the controlling stockholder of both companies.
  
  
• Special Committee of the Board of Directors of Metro Network in a merger with Westwood One, which had interested director implications.
  
  
• Special Committee of Independent Directors of Castle & Cooke Homes in a going private transaction proposed by its controlling shareholder, Dole Foods Company.
  
  
• Outside directors of Tenet Healthcare in connection with the company’s transition in management and disposition of major operating divisions.
  
  
• Management of PETCO in negotiations and agreements related to a management buyout of the company, which was then (as is now again) publicly held.