These point to the importance of making sure you doing a better job of due diligence and fact checking on all sides of the merger as well as any capitalization endeavors. From the panel discussion of “maximizing the value of your brand and intellectual property,” Bryan Sugar of Schwartz Cooper (a Chicago attorney specializing in IP assets) pointed out the following issues:

1. Identify all IP assets – registered and unregistered – owned by the company to ensure transfer of all IP assets.
2. Confirm whether the acquired company actually owns the assets that it represents it owns (work for hire, inventor issues, etc.).
3. Identify any material problems with enforceability of a company’s IP (scope of patent claims, etc.).
4. Identify security interests in intellectual property.
5. Avoid buying a lawsuit (cease-and-desist letters, breach of contract, etc.).
6. Confirm the status of the material intellectual property to avoid abandonment of IP after acquisition.
7. Identify acceptable representations and warranties concerning intellectual property.
8. Leverage in price negotiations.

These are all great points. Boiling down some of the cautions would be simply to ask: “Does the product work? Do you own 100 percent of it?”

From that same panel, UCC Capital CEO Robert W. D’Loren pointed out the changes in branded products and the need to review positioning a product with major retailers as they have focused more on proprietary brands. He said if your product is sold at PetsMart, chances are it will not be picked up at PETCO. If it’s sold at Kohl’s, it will not be picked up at Sears. If it’s sold at Circuit City, it will not be sold at Best Buy.

He said this is a significant recent factor in branding as well as the expansion of new channels in the market like the Internet, infomercials and TV shopping.

Automated Tools

Capital IQ, which is a division of Standard & Poor’s, had some demonstrations and a representative on one of the panel discussions. He focused on building relationship development tools and cutting through contact lists to target the right sources for potential funding and capitalization.

After working on several projects where this was an issue, I can safely say that having a tool like this could have cut through a lot of unnecessary contacting as well as reviewing the financial source about their appropriateness in doing the funding.

Speaker Damian Dolyniuk of Capital IQ said that doing due diligence on the funding source should be an integral step in ensuring that you don’t go down a path where you wind up finding out later that this was a bad match. While this sounds so basic, it isn’t.

All in all, the panels provided some practical insights for finding successes and failures that armed everyone with some valuable concepts to integrate into their strategies.

The Awards Dinner

1. Retail and distribution: Ziebart International, which was nominated by O’Keefe & Associates and was said to be a most difficult and creative transaction.
2. Consumer: Aquon Water Treatment Products, which was nominated by Smyth Wiley & Co.
3. Debt financing deal of the year: Blair Corporation, which was nominated by PNC Financial Services Group.
4. Financing deal of the year: Regal Beloit Corporation, which was nominated by Robert W. Baird & Co.
5. Middle-market financing professional of the year: Steve M. Laughlin, who was nominated by Financial Technology Partners.

Reflecting on the total atmosphere of the conference, the Drake Hotel did a great job in the two days with excellent food and service. It rivaled any conference that I had been to at the “destination” resorts and other convention cities. The Drake should be commended for setting a high standard rather than trying to work to attain one.

Unfortunately, some of the traditional business editors and columnists were missing at the conference. This would be equivalent for someone like Dan Jedlicka (a transportation columnist) missing the Chicago Auto Show. Do you think there’s a disconnect on what’s important and reflected in the media covering the financing, equity and entrepreneurial community and why Chicago is lagging behind?

Something that needs to happen in Chicago is that we need a cohesiveness between the different factions of entrepreneurs, established businesses, commercial and private financing institutions, state and local government, higher education and the media in order to create a more vibrant arena for new and sustainable growth.

I have said this in previous editorials, but in listening to everyone’s perspective at this conference, that observation is right on target and still holds true. How many jobs and new ventures must we lose or never be considered for before everyone wakes up? Maybe we should have a meeting in Las Vegas or at Pebble Beach to discuss it. Maybe then the media, the politicians and other equity people would attend.

Carlinism: At the conference, financial advisor Anurang E. Singh of Kaufman Hall pointed out: “Yes, a rule of thumb is good, but you have four other fingers.” In other words, don’t fail to check out alternatives.