M&A: Minority shareholders’ protection
Today’s post is about provisions in shareholders’ agreement for the benefit of minority shareholders. It is common to have a shareholders’ agreement when an M&A transaction results in more than one shareholder in the target company. Some provisions to include in a shareholders’ agreement for the benefit of a minority …
M&A: Consider the following when structuring earnout payment
Earnout provisions in M&A sale and purchase agreements require careful consideration as there are many parts to the provisions. It is important to ensure there is no ambiguity to avoid dispute. Consider the following when structuring earnout payment: 1. What is the performance metric that needs to be achieved in order …
M&A: When a buyer is induced by pre-contractual representations
A buyer may decide to acquire shares or assets or accept certain terms in a sale and purchase agreement (SPA) based on verbal representations made by a seller. If these verbal representations turn out to be false, does the buyer have any cause of action against the seller? The seller …
M&A: The pitfalls of earnout
Earnout is commonly used to reconcile the differences between a seller’s expectation and a buyer’s willingness to pay the sum expected by the seller. It a contractual mechanism whereby the buyer will pay additional payment beyond the initial purchase price to the seller if the target company achieves certain business …
M&A: Why should buyer conduct due diligence instead of just relying on warranties
Buyer: “Why can’t we just rely on warranties given by the seller in the SPA? Why should we conduct due diligence on the target?” Here’s why: 1. Due diligence allows the buyer to: · identify any consents from authorities or other third parties that are required for the acquisition pursuant to the …
M&A: When sellers refuse to give warranties
In M&A transactions, it’s common for the sellers to provide warranties to the buyers as assurance to the buyers on the condition of the target companies or business. However, the following sellers may argue that they should not be required to provide warranties or are willing to provide limited warranties …
The people behind each IPO
Their role in IPOs may not be that glamorous. Their names do not appear in the prospectus. They are the staff of companies which are undertaking IPO exercise. They are the ones who provide supporting documents for due diligence and attend to requests for information from the due diligence working …
Formatting
Formatting. If you are a transactional lawyer, a lot of time is spent on formatting a document. If your work includes preparing offer documents such as circulars and prospectuses, you have to ensure “perfect” formatting for all documents that are submitted to the authorities or issued to the public. There …
My blog
I was surprised when someone I have worked with contacted me to enquire about a post I put on my blog MalaysianCorporateLawyer.com. My blog usually gets a handful of readers from universities, banks and corporations. I didn’t expect someone I know would google for solution to an issue she faced …
Understand the “why” for M&A transaction
As lawyers, we need to understand the “why” that drives each M&A transaction. Why? So that lawyers could prepare drafts that are aligned with the clients’ objectives. The most enjoyable and efficient M&A transaction that I have done was one which the client worked closely with us to provide the …