Pfizer Inc. began the decade by beating out American Home Products Corp. in the $90 billion battle for Warner-Lambert Co. Now, the New York pharmaceuticals giant hopes to end the decade by taking over Wyeth, as AHP renamed itself in 2002.

Financing was a central issue in the deal, which was announced Jan. 26. Talks started in the summer, when the financing markets were already tight and buyers were already demanding -- and winning -- financing outs from their targets. Mars Inc., for example, won an agreement structured in the style of a traditional private equity deal from Wm. Wrigley Jr. Co. in a deal announced April 28. Wrigley would have had no recourse if Mars had walked except for the collection of a breakup fee. And International Paper Co. won a modified financing out when it agreed to buy Weyerhaeuser Co.'s packaging and recycling business for $6 billion in March.

The trend continued into the summer, with Ashland Inc. getting a financing out from Hercules Inc. and Brocade Communications Systems Inc. winning one from Foundry Networks Inc. Dow Chemical Co. did not secure such a right when it agreed in July to buy Rohm and Haas Co., which is suing in Delaware's Court of Chancery to force Dow to close that $18 billion cash acquisition.

So Pfizer and Wyeth and their army of advisers had plenty of precedents -- and, in Pfizer's case, one ominous object lesson -- as they worked on their agreement. Perhaps their most noteworthy innovation is the size of the reverse termination fee Pfizer would owe Wyeth if it walked from the deal: $4.5 billion, or 6.6% of the $68 billion in cash and stock that Pfizer would pay or, looked at another way, 10% of the cash Pfizer agreed to pay. Historically, reverse breakup fees have tracked breakup fees even though the two serve different purposes.

Delaware courts have long limited breakup fees -- the money a seller agrees to pay to a prospective buyer if the seller takes a better offer -- to about 3% of deal value as recompense for the jilted party's time and expense in signing up what turns out to be a stalking-horse bid. Reverse breakup fees are meant to do the reverse: to compensate a seller if the buyer walks, in this case for failure to find financing. (In some deals, sellers have negotiated reverse break fees in the event the buyer fails to win antitrust approval for a deal.) Delaware courts have limited breakup fees because of fears that they can serve as takeover defenses excessively punitive to an interloper, but there is no such fear in the case of reverse break fees. In decoupling the two, the Pfizer-Wyeth tie-up frees lawyers in future deals to be more creative in managing financing risk.

So who came up with the Pfizer and Wyeth terms? Both companies turned to the same lawyers on the current deal as they did in their battle for Warner-Lambert nearly 10 years ago. Pfizer tapped Dennis Block at Cadwalader, Wickersham & Taft LLP and the seller went with Charles "Casey" Cogut at Simpson Thacher & Bartlett LLP.

Block has been Pfizer's lead outside M&A counsel for years. In addition to advising on Warner-Lambert, he represented Pfizer on the $16.6 billion sale of its consumer business to Johnson & Johnson in 2006 and its acquisitions of Vicuron Pharmaceuticals Inc. for $1.9 billion in 2004 and Pharmacia Corp. for $57 billion in 2003. William Mills III was the second chair on the deal at Cadwalader. Pfizer also tapped Tony Reeves at Clifford Chance LLP in Brussels for competition advice, Morgan, Lewis & Bockius LLP as U.S. antitrust counsel, along with Cadwalader's Jonathan Kanter and Rick Rule, and DLA Piper US LLP on due diligence.

Cogut first advised AHP on its $9 billion hostile takeover of American Cyanamid Co. in 1994 and has continued to work for the company, which has shunned big-ticket M&A since its name change. In the late 1990s, Wyeth watched three potential megadeals go up in smoke, as negotiations with SmithKline Beecham plc and Monsanto Co. fell through before Pfizer wrested Warner-Lambert from AHP. Wyeth's board is using Adam Emmerich at Wachtell, Lipton, Rosen & Katz, who had worked with Wyeth outside director Victor Ganzi when he was the CEO of Hearst-Argyle Television Inc.

On the banking side, Wyeth used Paul Taubman, Clint Gartin and Susan Huang at Morgan Stanley, which advised AHP on the Warner-Lambert situation and, along with Simpson Thacher, on the $16.9 billion sale of Immunex Corp. to Amgen Inc. in 2002. AHP owned 41% of Immunex. Roger Altman and François Maisonrouge at Evercore Partners Inc. also represent Wyeth on the current deal.

Pfizer tapped a quintet of financial advisers, all of which are helping to raise the $22.5 billion that Pfizer will need to borrow to close the deal. In the lead are Tom Davidson and Alan Hartman of Bank of America Merrill Lynch; Jack Levy and Torrey Browder of Goldman, Sachs & Co.; and Doug Braunstein at J.P. Morgan Chase & Co. Barclays Capital and Citigroup Inc. are also advising.

Conspicuously absent from the list is Lazard, a firm that has long been close to Pfizer. Lazard's Felix Rohatyn became Pfizer's first outside director back in 1971 and sat on the company's board for 26 years. When Rohatyn left Lazard in 1997, he handed off the relationship to Steven Golub, and the firm continued to work with Pfizer on a string of deals, including its purchases of Warner-Lambert and Pharmacia and the sale to J&J. But Lazard lacks the financing capacity of the five banks that won the mandate to advise Pfizer on Wyeth.

Also missing is Bear, Stearns & Co.'s Alan Schwartz, who also advised Pfizer on the J&J and Pharmacia deals. Bear, of course, is no more, and Schwartz, its head of M&A and, eventually, CEO, has not surfaced at another firm.