Last month, we began a seven-part series on “Legal Considerations for Selling an Emerging Growth Company,” and, in that post, we discussed six important steps in the merger and acquisitions process that emerging growth companies will need to prepare for, which are: (1) engaging a financial adviser; (2) entering into a non-disclosure agreement; (3) negotiating the term sheet or letter of intent; (4) due diligence; (5) drafting and negotiating definitive documents; and (6) closing. We will continue to dive deeper into each of these steps of the process, and this month we are focusing on the first step, which is negotiating an engagement letter with a financial adviser. [Read more…]
Legal Considerations for Selling an Emerging Growth Company Part 2: Creating an Engagement Letter with a Financial Adviser
Everyone knows that a primary goal for many, if not most, startups and tech companies is to eventually sell the company, even if the founders intend to remain with the company. It goes without saying that selling your company can result in an enormous payday and provide continued vitality for the company going forward. That said, it’s critical that owners/entrepreneurs comply with legal requirements and protect their legal interests throughout the sales process to maximize their chances for a positive outcome.
With that in mind, this month I’m beginning a series of blog posts on the legal considerations you’ll need to keep in mind when selling your business. We begin with taking a look at an overview of the process involved in a merger or acquisition (often referred to as an “M&A deal”). Below is a high-level look at six essential steps to successfully completing an M&A deal, and in future posts we will dive deeper into what each one means for you. [Read more…]
As I’ve written before on this blog, business owners need to be careful about hiring unregistered brokers and finders for capital raises. This rule applies to some M&A events as well. I was recently interviewed by The Ambulatory M&A Advisor, and the resulting article can be found here: http://www.ambulatoryadvisor.com/the-dangers-of-unregistered-brokers-and-finders/
While The Ambulatory M&A Advisor specializes in M&A for ambulatory care centers, the issues discussed apply to any business.
On January 31, 2014 (revised February 4, 2014), the SEC issued a no-action letter to a group of attorneys who requested assurance on an issue that has long been on the minds of securities lawyers: are people who facilitate the sale of a controlling interest in a business involving a transfer of stock — which the Supreme Court has held to be a sale of securities under federal securities laws — required to register as broker-dealers under the Securities Exchange Act of 1934, with all of the attendant expenses and obligations?
This is the final part of our series discussing the sale of a business from the seller’s perspective. We’ve covered commencement of a potential deal through the closing and discussed certain post-closing items (primarily indemnification). To wrap up, we’ll recap some of the major items we’ve discussed and some of the tips we’ve provided. [Read more…]