Introduction The Seller got past a motion for summary judgment in its gross profits earnout lawsuit against its strategic buyer. See http://www.mk-law.com/wpblog/court-gives-pharmacy-seller-chance-to-collect-earnout/ for my earlier blog about the summary judgment motion. But, although the seller won the battle, it ultimately…
Monthly Archives: June 2019
Strategic Buyer’s Refusal to Sign APA Authorized by LOI
Introduction The Mississippi high court held that an LOI gave a strategic buyer the right to not sign an APA. The deal The seller started operations as a Mississippi hospice in June of 2007. The founder and owner ran it…
Bankruptcy Court Permits 363(f) Sale of Business Free of Pension Claim
Introduction A pension plan unsuccessfully tried to stop a company from selling a business to a buyer in a 363(f) (3) sale free and clear of the seller’s pension fund liability. The deal The seller was engaged in environmental and…
Posted in asset purchase agreement, bankruptcy sale, distressed business acquisitions, federal multiemployer pension plan withdrawal liability, Section 363 sale, successor liability Tagged with: 363(f) sale, alter ego, contingent liability, multiemployer pension plan withdrawal liability, successor liability, transferee liability
Lawsuit Over EBITDA Earnout “Determined in Accordance With Buyer’s Historical Reporting Policies”
Introduction This is another post-closing M&A dispute over an EBITDA earnout. The deal The seller was a San Jose based small security guard service. It sold its assets in September 2016 to a Georgia based nationwide security company with about…
Posted in bad faith, corporate overhead, de facto merger exception, earn outs, EBITDA Tagged with: corporate overhead in earnouts, EBITDA earnouts
Purchase Price Royalty for SaaS Business Didn’t Include Professional Fees
Introduction The seller’s purchase price royalty for sale of a software as a service business did not include post-closing hourly professional fees. The deal The seller is a Seattle based systems integration firm that developed a cloud-based application that lets…
Posted in purchase price, royalty Tagged with: royalty base definition, software royalty purchase price
APA Integration Provision and Exclusive Remedy Clause Bars Seller Claim
Introduction A seller of a mortgage service business could not sue its asset buyer in tort for negligent misrepresentation. The deal The seller was a Denver based company that was formed after the 2008 financial crisis to assess and verify…
Posted in earn out, economic loss doctrine, exclusive remedy, integration clause Tagged with: asset purchase agreement, entire agreement, promise not representation
Vague APA Note Payment Adjustment Provision Results in Lawsuit
Introduction This post closing asset deal dispute could not be resolved by summary judgment because the purchase money note adjustment provision was held to be an unenforceable agreement to agree. The deal The Utah based seller manufactured a garden planter…
Indiana APA Choice of Law Provision Doesn’t Apply to Its Product Line Exception
Introduction Generally, a cash buyer of the assets of a business is not responsible for the defective products made by the seller, unless the buyer assumed those liabilities in the asset purchase agreement. However, California started imposing the seller’s product…
Owner Sells Company’s Fitness Club Assets; Fights Personal Trainer Claims
Introduction Selling your company can be very stressful for employees and contractors not picked up by the buyer. Especially those that have depended upon cash flow from your company for a long time. This creates a risk you may be…
Posted in asset purchase agreement, assignment of contracts, contracts, due diligence Tagged with: assignment of contracts; due diligence of contracts
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