Discover how ambiguous language in M&A noncompete carve-outs can lead to costly post-closing litigation for lower middle market businesses. This deep dive into a recent court case highlights critical pre-closing drafting mistakes by sellers and offers actionable strategies for buyers,…
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The Cost of Ambiguity: Protecting Retained Businesses from Overly Broad M&A Noncompetes
Posted in Uncategorized Tagged with: "as currently conducted" clause, Acquisition Agreement, asset purchase agreement, Business acquisition, business owner advice, Business Sale, buyer overreach, carve-out provision, contract drafting, contract language, contractual ambiguity, deal negotiation, Delaware Court, Goodwill, HVAC service business, legal advisor insights, legal risk management, litigation avoidance, lower middle market, M&A, M&A advisor, noncompete agreement, Post-closing disputes, pre-closing mistakes, private target, Restrictive Covenant, retained business, Seller Protection, skylight manufacturing
Protecting Your Earnout in a Post-Closing Seller Bankruptcy
Unlock critical insights for lower middle market M&A. This post reveals a non-obvious risk for sellers relying on earnouts: what happens when the selling entity faces post-closing bankruptcy? Learn crucial pre-closing contractual strategies to protect your earnout and navigate complex…
Posted in earnouts in bankruptcy, problems with earnouts Tagged with: APA, asset purchase agreement, bankruptcy law, Business Sale, Buyer's Perspective, Chapter 11, contingent payment, contract drafting, contract rejection, contractual provisions, Corporate Law, deal-making, distressed M&A, due diligence, Earnout Provisions, earnouts, legal advice, Legal Disputes, legal risk management, lower middle market M&A, M&A, M&A advisors, M&A litigation, Mergers and Acquisitions, negotiation strategies, Post-closing adjustments, post-closing obligations, pre-petition debt, private company M&A, Purchase Price, sale of business, seller bankruptcy, Seller's Perspective, transaction structuring, vested rights
Beyond the Balance Sheet: Why Sellers Must Confront Hidden Tax Liabilities Before a Deal
Uncover the critical pre-sale strategies that can safeguard your M&A deal. This insightful post delves into how hidden and unaddressed tax liabilities can derail transactions and lead to costly post-closing litigation for sellers. Drawing lessons from a recent Delaware Court…
Posted in problems with taxes Tagged with: Business owners, contract law, Corporate Law, deal value, Delaware Court of Chancery, due diligence, federal telecommunications tax, hidden taxes, indemnification, legal advisors, legal risk management, lower middle market, M&A, M&A advisors, M&A litigation, Mergers and Acquisitions, Post-closing disputes, pre-closing, pre-sale cleanup, private company sale, risk management, sales tax, seller due diligence, sellers, state and local tax, statute of limitations, tax cleanup, tax compliance, tax liabilities, undisclosed taxes, VDA, voluntary disclosure agreement
GAAP or History? Don’t Leave Your M&A Purchase Price Adjustment to Chance M&A Stories
Uncover how a $22 million M&A dispute hinged on a single accounting definition. This post dives into the critical challenge buyers, sellers, and advisors face when negotiating purchase price adjustments: should calculations follow GAAP or historical accounting practices? Learn how…
Posted in accounting methodology, purchase price adjustment Tagged with: accounting expert, accounting methodology, Bitcoin mining, buyers, closing adjustments, contract disputes, cryptocurrency industry, data center acquisition, deal negotiation, deferred revenue, Delaware Court of Chancery, due diligence, financial metrics, GAAP, historical accounting, indebtedness, legal risk management, lower middle market, M&A, M&A advisors, M&A litigation, merger and acquisition, Post-closing disputes, PPA, private targets, protecting purchase price, purchase price adjustment, sellers, SPA, stock purchase agreement, strategic drafting, transaction pitfalls
Defining Ordinary Course A Crucial Carve-Out Lesson for M&A Buyers
Learn how to avoid common M&A litigation pitfalls in carve-out transactions. This blog post unpacks a critical New York M&A case, revealing why precise contract drafting, especially for “ordinary course of business” clauses in carved-out segments, is vital for buyers.…
Posted in ordinary course of business Tagged with: acquisition risk, advertising dispute, asset purchase agreement, Boilerplate clauses, Business acquisition, Buyer Beware, call center acquisition, carve-out transaction, contract drafting, contract negotiation, Corporate Law, deal protection, dispute resolution, due diligence, indemnification, Legal precedent, legal risk management, legal strategy, lower middle market, M&A advisor, M&A best practices, M&A legal, M&A litigation, New York M&A law, ordinary course of business, Post-closing disputes, private target, RIFs, seller defense
Navigating M&A Disputes Ensure Your Forum Selection Clause Doesn’t Undermine Arbitration
Discover how unharmonized arbitration clauses with forum selection clauses in M&A agreements create costly litigation. This post analyzes a recent Fifth Circuit case to show lower middle market buyers, sellers, and their advisors how precise pre-closing drafting of these provisions…
Posted in arbitration, dispute resolution provision, problems with forum selection clauses Tagged with: arbitration clause, asset purchase agreement, Business acquisition, contract drafting, contract negotiation, Corporate Law, deal value, dispute resolution, Earnout disputes, FAA, Federal Arbitration Act, Forum selection clause, legal pitfalls, legal risk management, lower middle market M&A, M&A best practices, M&A Disputes, M&A legal, M&A litigation, Odom Industries, pre-closing risks, private target businesses, Sipcam Agro Solutions, transaction advisory, working capital adjustments
Mastering the Hybrid Noncompete A Perilous Path in M&A
Unlock the hidden risks of hybrid noncompetes in M&A deals where sellers stay on. This essential guide for buyers, sellers, and advisors reveals why combined restrictive covenants often fail in court and how strategic pre-closing legal structuring can protect your…
Posted in covenant not to compete, hybrid noncompetes Tagged with: 8th Circuit Court of Appeals, Arkansas law, business goodwill protection, contract drafting, contractual provisions, deal structuring, employment noncompete, enforceability of noncompetes, legal risk management, legal strategy, lower middle market M&A, M&A legal, M&A litigation, noncompete agreement, Post-closing integration, pre-closing due diligence, private equity acquisition, private target businesses, Restrictive covenants, sale of business noncompete, seller-owner employment, Strategic buyer
In Asset Sales How to Preserve Your Right to Recover Damages from a Co-Owner’s Pre-Closing Misconduct
For lower middle market M&A asset sales, learn a critical strategy to preserve seller owners’ rights to recover damages from pre-closing misconduct like fiduciary breaches or diverted opportunities. A recent Delaware case highlights how overlooked contract language can jeopardize these…
Posted in Excluded Assets Tagged with: APA, asset purchase agreement, Baugh v Ingle case, business sale legal issues, co-owner disputes, contractual provisions, corporate opportunity usurpation, Delaware Court of Chancery, derivative claims, excluded assets, family business M&A, fiduciary duty breach, founder exits, fraud claims, legal pitfalls, legal risk management, lower middle market M&A, M&A advisors, M&A asset sales, M&A Due Diligence, M&A legal strategy, post-closing litigation, pre-closing misconduct, private company M&A, private equity acquisition, retained claims, seller owners, Strategic buyer
The Costly Impasse: M&A Litigation Arising from Unspecified Dispute Accountants
Navigating M&A purchase price adjustments can be tricky. This blog post dissects a recent legal case highlighting a common pitfall in lower middle market deals: the failure to pre-select an accounting firm for working capital dispute resolution. Learn how this…
Posted in Accounting Firm Dispute Resolution Tagged with: accounting firm selection, Acquisition Agreement, contract negotiation, deal terms, dispute accountants, dispute resolution, legal pitfalls in M&A, legal risk management, lower middle market, M&A agreement, M&A legal, M&A litigation, Mergers and Acquisitions, neutral accountant, Post-closing adjustments, private company acquisitions, purchase price adjustment, Risk mitigation in M&A, working capital
Indemnity’s Paper Trail: The Unexpected Cost of Overlooking Supporting Documents in M&A
Don’t let a seemingly minor clause sink your M&A deal recovery. This crucial legal blog dissects a Delaware Supreme Court case revealing the unexpected cost of overlooking the supporting document requirement in indemnification notices. Essential reading for buyers, sellers, and…
Posted in problems with indemnification notice Tagged with: Acquisition Agreement, buyer protection, contract law, deal terms, Delaware Supreme Court, due diligence, excuse from indemnification forfeiture, indemnification forfeiture, indemnification notice, Legal Blog, legal risk management, lower middle market, M&A advisors, M&A indemnification, M&A litigation, Mergers and Acquisitions, Post-Closing, Private Equity, Risk mitigation, Seller Protection, supporting documents, transaction law
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