COURSE DESCRIPTION
Mergers and buyouts of closely held companies are complex, multifaceted processes. Agreeing on a valuation can be very difficult because there is no regular market of buyers and sellers and information on comparable sales is scarce. Closely held companies are typically structured to benefit a few shareholders, often members of a family, and require their financial statements to be normalized. There can also be substantial issues of liability, including successor liability in asset deals, requiring carefully crafted reps and warranties. Confidentiality is often essential in these transactions as sellers try not to unsettle existing commercial relationships and employees. This program will provide you with a practical guide to major planning and drafting considerations in the mergers and buyouts of closely held companies.
Day 1:
- Confidentiality considerations in the sale and negotiation process
- Due diligence – financial, operational and workforce red flags
- Stock v. asset transactions and forms of consideration – cash v. equity
- Valuation of closely held companies in an illiquid market
- Use or of “earnouts” to bridge the gap in valuation
Day 2:
- Reps, warranties, indemnity and basket issues common to closely held companies
- Successor liability concerns where assets are transferred
- Asset transfer issues – intangible assets, including intellectual property
- Transition issues – management, employees, business relationship, contract issues
- Escrow and post-closing issues
Speaker:
Daniel G. Straga is a partner in the Washington, D.C. office of Venable, LLP, where he counsels companies on a wide variety of corporate and business matters across a range of industries. He advises clients on mergers and acquisitions, capital raising, venture capital, and governance matters. He also have extensive experience in private equity and cross-border transactions.
Molly Merritts is an attorney in the Washington, D.C. office of Venable, LLP, where she focuses her practice on a wide range of corporate law matters, including mergers and acquisitions, debt and equity financing, and real estate investment trusts. She also advises clients on corporate governance matters, transactional and commercial contract negotiations, and corporate reorganizations.