Mergers and Acquisitions Archives

When it comes to selling your company, attorneys are a necessity. Mergers and acquisitions (M&A) can be an incredibly complex process, with a variety of moving parts that need to be considered. Having an experienced attorney to guide you through the process will help ensure a smooth, successful transaction. In this blog post, we’ll explore the importance of having an attorney when selling your company and how they can help you reach your desired outcome. Attorneys at SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) law firm provides professional legal advice and services to clients in Palm Springs, Palm Desert, Rancho Mirage, Inland Empire, Orange County, Coachella Valley, Costa Mesa, San Diego, New Jersey, New York, and surrounding locations.

The Process of Selling a Company

Selling a company is a complicated process that involves many legal and financial aspects. It’s not something that can be done quickly or without the help of a professional. Whether you are selling your business to retire, move on to other opportunities, or just want to cash in on your hard work, there are a lot of factors to consider.

The first step in the process of selling a company is to evaluate the business. You’ll need to identify the strengths and weaknesses of your business, determine what assets you have to offer, and establish a value for your company. This involves examining the financial records, market position, brand value, and potential growth prospects of your business.

Once you’ve established the value of your business, you’ll need to identify potential buyers. You can use business brokers, advisors, or accountants to help with this process. You’ll want to find buyers who have the capital to purchase your business, as well as the experience and expertise to manage and grow the business after the sale.

Once you’ve identified potential buyers, you’ll need to negotiate the terms of the sale. This involves setting a purchase price, establishing payment terms, and negotiating other aspects of the deal, such as the transition period and the roles of the new owner and existing management.

Throughout this process, it’s important to have legal representation to protect your interests. This is where an attorney can be invaluable.

An attorney can assist you with the legal aspects of selling your business. They can help with the preparation and review of the sales agreement, ensure that all necessary legal requirements are met, and provide guidance on tax implications and other legal issues.

In the next section of this post, we’ll discuss in more detail what an attorney can do for you when selling your company.

What an Attorney Can Do For You

Selling a company is a complex and daunting process, with many legal and financial considerations to navigate. An experienced attorney can help guide you through the process and protect your interests. Here are some of the things an attorney can do for you when selling your company:

Review and draft contracts: Your attorney can review any agreements related to the sale, such as purchase agreements, non-disclosure agreements, and employment contracts. They can also draft these agreements to ensure that your interests are protected.
Conduct due diligence: Your attorney can assist with the due diligence process, which involves reviewing the company’s financial and legal documents. This is important for both the buyer and the seller, as it helps to identify any potential risks or issues.
Negotiate terms: Your attorney can negotiate the terms of the sale, including the purchase price, payment terms, and any contingencies. They can also help you understand your options and make informed decisions.
Address legal issues: Your attorney can identify and address any legal issues that may arise during the sale, such as tax liabilities, regulatory compliance, or intellectual property concerns.
Provide legal advice: Finally, your attorney can provide legal advice throughout the process, ensuring that you are fully informed and able to make the best decisions for yourself and your company.

Overall, having an attorney by your side when selling your company can provide peace of mind and help ensure a smooth and successful transaction.

The Benefits of Having an Attorney

When it comes to selling your company, having an experienced attorney by your side can make a significant difference. Here are some of the benefits of having an attorney when selling your business:

Protecting Your Interests: An attorney can ensure that your interests are protected throughout the entire sale process. They can help you negotiate favorable terms and ensure that you’re not taken advantage of during negotiations.
Mitigating Risks: Selling a business involves numerous risks, and an attorney can help mitigate these risks. They can review contracts, identify potential legal issues, and ensure that all legal requirements are met.
Drafting Legal Documents: Selling a business requires the creation of various legal documents such as purchase agreements, non-disclosure agreements, and more. An attorney can ensure that these documents are legally sound and that they protect your interests.
Assisting with Due Diligence: Due diligence is an essential part of any business sale. An attorney can assist with this process by reviewing legal and financial documents, identifying potential risks, and ensuring that everything is in order.
Managing Disputes: Disputes can arise during the sale process, and having an attorney on your side can help you manage these disputes effectively. They can provide guidance and representation in negotiations and even litigation if necessary.

How to Find the Right Attorney

Now that you know the importance of having an attorney when selling your company, you may be wondering how to find the right one. Here are a few tips to help you get started:

Ask for Referrals: Start by asking trusted friends, family, or business associates if they have any recommendations for a good attorney. You can also ask your accountant or financial advisor for referrals.
Look for Experience: It’s important to choose an attorney who has experience in mergers and acquisitions. Look for someone who has successfully represented clients in similar deals.
Research Credentials: Make sure the attorney is licensed and in good standing with the state bar association. You can check their credentials online or ask for proof of their qualifications.
Meet in Person: Schedule a consultation with the attorney to discuss your needs and get a feel for their communication style. Make sure you feel comfortable working with them and that they understand your goals.
Review the Contract: Before signing on with an attorney, make sure you understand their fee structure and what services they will provide. You should also review the contract carefully to ensure there are no hidden fees or surprises.

By taking the time to find the right attorney, you can ensure that you have a trusted advisor on your side throughout the process of selling your company.

Have any legal questions? Contact the Attorneys at SBEMP Law Firm:

For more information or to request a consultation please contact the law offices of SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) by clicking here.

SBEMP LLP is a full service law firm with attorney offices in Palm Springs (Palm Desert, Inland Empire, Rancho Mirage, Indian Wells), CA; Indian Wells, CA; Costa Mesa (Orange County), CA; San Diego, CA; New Jersey, NJ; and New York, NY.

DISCLAIMER: This blog post does not constitute legal advice, and no attorney-client relationship is formed by reading it. This blog post may be considered ATTORNEY ADVERTISING in some states. Prior results do not guarantee a similar outcome. Additional facts or future developments may affect subjects contained within this blog post. Before acting or relying upon any information within this newsletter, seek the advice of an attorney.

Mergers & Acquisitions

Mergers and acquisitions (M&A) involve the merging of two businesses or companies to form a new legal entity. This legal entity is created under a new business name. Acquisition involves the purchase of another entity or company.

There are several different types of transactions within M&A. This includes tender offers, consolidations, management acquisitions, acquisition of assets and various other ways of combining or merging companies into another entity. Few of these ways include vertical mergers, horizontal mergers, congeneric mergers, purchase mergers, consolidation mergers, product-extension mergers, market-extension mergers, conglomerations, and reverse mergers.

There are legal ramifications associated with each type of M&A requiring a business law attorney to negotiate, draft and execute contractual agreements for all involved parties.

Attorneys at SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) law firm provides professional legal advice and services to clients in Palm Springs, Palm Desert, Rancho Mirage, Inland Empire, Orange County, Coachella Valley, Costa Mesa, San Diego, New Jersey, New York, and surrounding communities.

Merger

This is the process by which two different companies join together to become a new one. This is also known as consolidation. Neither of the two companies can function independently in case of a merger.

Acquisition

This is when a company takes over the assets of another. Takeover or acquisition is the purchase of a business by another. These are of two types – public and private. The difference depends on whether the target company’s stocks are publicly traded or not. Acquisitions can be hostile or friendly depending on the outlook of the target company.

Federal Trade Commission

The FTC or Federal Trade Commission is responsible for ensuring that transactions are compliant with anti-trust and fair competition laws. There is always the concern of a single entity taking over a too large market share or resorting to anti-competitive behavior.

Securities and Exchange Commission

The Securities and Exchange Commission (SEC) ensures that there are no illegal activities, such as improperly devalued stocks, insider trading or any other inappropriate conduct.

Law Firms with M&A Expertise

Law firms can provide guidance on:

Corporate carve outs
Cross border transactions
Asset and equity purchases
Auctions
Exchange offers
Hostile takeovers
Joint ventures
Fiduciary duty and disclosure issues
Going private transactions
Leverage buyouts
Mergers
Proxy battles
Restructurings and recapitalizations
Minority investments
Poison pill and counseling on other defensive measures
Roll up transactions
Sales of controlling interests
Subsidiary spinoffs

Need for Legal Guidance

Mergers and acquisitions are common in any industry. They usually occur for a wide variety of reasons, such as diversifying business operations and offerings, increasing value, lack in financial capacity, acquisition of assets, tax purposes and personal interests. It’s vital that you have a legal team for assisting you with the transaction regardless of the reason.

Experienced M&A attorneys work directly with their clients and advise them on negotiating, drafting, and executing of contracts for the sale. They also help put in place adequate financing, including stocks and cash. M&A is a unique process that has given rise to an industry with a number of stock brokers, law firms, and accountants among other business experts dedicating their practice to it.

Lawyers at the SBEMP law firm serve clients from Palm Springs, Palm Desert, Rancho Mirage, Inland Empire, Orange County, Coachella Valley, Costa Mesa, San Diego, New Jersey, New York, and nearby locations for a range of legal practice areas.

Have any legal questions? Contact the Attorneys at SBEMP Law Firm:

For more information or to request a consultation please contact the law offices of SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) by clicking here.

Mergers & Acquisitions

Mergers and acquisitions refer to business transactions that occur as a result of a purchase or takeover of one company by another. A merger or acquisition is combining businesses or absorbing one business entity into the other.

The transaction enables a business to become bigger or smaller or change its organizational structure. Mergers and acquisitions law involves offering advice to companies on potential mergers and acquisitions.

In addition, it involves negotiating the transaction as well as the preparation of the necessary paperwork to complete the merger or acquisition.

What is a Merger in Business?

A merger occurs when two companies combine to create a new company. After a merger, the two companies combine to conduct business operations together.

While every merger develops a unique organizational structure and climate, the nature of a merger is such that both companies involved are on an equal plane during and following the merger. Usually, after a merger, the old shares from each company are transferred to create new shares in the name of the new entity.

There are various types of different business entities that merge. For instance, two companies that are in direct competition to offer the same goods or service might combine to compete together.

Two organizations offering similar products in diverse markets may combine to expand the market size. On the other hand, a manufacturer might merge with a supplier, or companies offering different but related products to offer combined products in a single territory.

What is an Acquisition in Business?

When one company purchases another company and takes over operations, it is known as an acquisition or a takeover. Acquisitions may involve private as well as public companies.

The acquired company may or may not be open to the transaction. It is known as a hostile acquisition when the management of the acquired company is against the transaction.

A majority of acquisitions involve an older or larger company taking over a smaller or newer company. A reverse takeover refers to a smaller or younger company acquiring a larger company but retaining the name of the larger company.

Why do Companies pursue a Merger or an Acquisition?

Companies might consider a merger or acquisition to enhance their business position. One or both organizations might increase the value of their company due to the transaction.

The transaction might enable a company to increase the geographical territories where they conduct operations or diversify their interests. The transaction can result in a payday for owners or shareholders of the acquired company.

Who practices Mergers and Acquisitions Law?

Business attorneys practice mergers and acquisition law. As a merger or acquisition is a time-intensive and involved process, most lawyers who work on mergers and acquisitions specialize in business law at least if not entirely focus on mergers and acquisitions. But not all mergers and acquisitions lawyers are engaged by large firms.

A small company that operates in a single geographical territory might use a local, solo practitioner to pursue a merger or acquisition. Alternatively, a large company pursuing a merger or acquisition usually works with larger law firms.

For more information or to request a consultation please contact the law offices of SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) by clicking here.

SBEMP LLP is a full service law firm with attorney offices in Palm Springs (Palm Desert, Inland Empire, Rancho Mirage), CA; Indian Wells, CA; Costa Mesa (Orange County), CA; San Diego, CA; New Jersey, NJ; and New York, NY.

Business Law

Business law, also known as commercial law or mercantile law, is the law that governs business practices between individuals and commercial matters.

The team of knowledgeable and skilled attorneys at SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) law firm provides professional legal advice and services to clients in Palm Springs, Palm Desert, Rancho Mirage, Inland Empire, Orange County, San Diego, New Jersey, New York, and surrounding locations.

Business Formation

Business law initiates as soon as a business is set-up. Business attorneys assist decision makers in understanding the benefits and limitations of each entity when they are setting up a business.

They provide the founders of the business with insights on the law to help them select the entity that best serves their interests. Subsequently, they help the founders file the documents to begin the business formally.

Employment Concerns

A business may need employees after it hits the ground. Businesses require legal guidance to help them understand the right way to appoint and fire employees as well as ways to handle employee discord and discipline.

They also need to understand what to offer as pay and benefits to employees. Furthermore, there are obligatory payroll taxes and deductions as well. Business attorneys provide their clients with details on the regulations and best practices for employee management.

Sales of Consumer Products

Buying and selling are not as straightforward as it appears on the surface and there are various laws governing how companies manufacture and sell products. Business attorneys assist their clients in understanding the regulations that a business must follow and helps ensure that the company complies with the law.

Contract Drafting and Negotiations

Business law attorneys have to comprehend facets of contract law from statutes as well as common law. Furthermore, they must have a thorough understanding of the intricacies that may affect the enforcement of a contract. These lawyers must work with their clients to negotiate and draft contracts in a manner that is most suitable to the client’s interest.

Anti-Trust

Businesses that use unfair or dishonest practices to stay ahead of the competition may face allegations of anti-trust violations. Business lawyers can assist their clients in identifying any offending activities that can comprise anti-trust before such activities can cause issues for the company.

Intellectual Property

Upon creating a new product, a business must ensure that they protect their ability to profit from their innovation. Intellectual Property and Copyright law protect a business’s right to keep and use their products fully.

Taxes

Operating a business involves awareness of various taxes involved such as employee taxes, estimated taxes, and deductions. A business attorney can help companies fulfill their tax obligations as well as take steps to reduce their tax burden.

They may assist the business in applying for special tax waivers or forgiveness which the company may be eligible for at specific locations or for particular industries.

Bankruptcy

If a business faces financial hardships, they will require attorneys to help them understand their options. The only or ideal option for a struggling company is not always filing bankruptcy.

Business attorneys can offer their clients advice on the benefits and limitations of various actions. After the company strategizes a plan, attorneys can help the business complete the filing properly and remain in compliance with the legal requirements.

Have any legal questions? Contact SBEMP:

For more information or to request a consultation please contact the law offices of SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) by clicking here.

We hear about various companies engaging in mergers and acquisitions all the time but what exactly do those two words mean? Webster’s Dictionary defines merger as the combining of two things, especially companies, into one. An acquisition, meanwhile, is defined as an asset or object bought or obtained, typically by a library or museum but it can also apply to companies. (more…)

M&A Strategies Are A Key Method Of Efficiently Growing A Business:

One of the most effective strategies utilized in the business world today is the strategy of acquisitions and mergers. Under the right circumstances, this strategy can prove to be ideal to upgrade access to markets at the same time as gaining the benefit of removing excess from the act of consolidation. These strategies fall under the banner of M&A and they are often utilized across international borders in today’s global marketplace.

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The decision to structure the sale of a business as an asset or a stock is difficult because the buyer benefits from assets and the seller benefits from stock sales. All business transactions are individual and should be discussed with the respective legal and financial parties involved.

What’s Involved In An Asset Sale?

An asset sale involves a buyer purchasing individual assets and the liabilities that go along with them while a stock sale is a buyer purchasing a piece of an owner’s corporation. The main concerns when dealing with business transactions are the tax implications and any potential liabilities.

Is A Stock Sale Possible?

A stock sale is not possible if a business is a sole proprietorship, partnership, or a limited liability company. Simply because these business structures do not have stock. The owners of these businesses can sell their interests. If the business is incorporated, the buyer and seller have to agree on if they should do an asset sale or stock sale.

What’s Gained In An Asset Sale?

With an asset sale, the buyer gets the company assets, such as all equipment, licenses, leaseholds, trade secrets and names, phone numbers, and inventory. No cash is involved, and the long-term debt remains with the seller. This is called a cash-free, debt-free sale. Net working capital is also included, which is simply accounts receivable, payables, prepaid and accrued expenses.

What’s Gained In A Stock Sale?

With a stock sale, the stock is purchased directly, and the buyer is the new legal owner. Any unwanted assets and liabilities will be resolved prior to the sale. Stock sales are different from asset sales because the assets don’t have to be listed as individual since each asset is already within the corporation.

What Is More Common Asset Sales Or Stock Sales?

According to Pratt’s Stats database, almost half of all business transactions are stock sales. Of course, this generalization varies by company size. The larger the company, the more likely it is to have stock sales. If you need help deciding whether to sell as an asset or stock you can always reach out to our experienced Coachella Valley mergers and acquisitions attorneys.

Buyouts and LBOs tend to come from one of three groups; current management (of the company in question), another company, or a private, non-public equity firm.

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Progressive corporations have realized that a merger is not only dependent on the combination of the two companies’ assets, but also of the cooperation of their employees and human resources. Given that the demand for capital, heavy regulatory burdens, and shifting models of compensation, a business has financial challenges they face when completing a Merger and Acquisition.

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With the current financial conditions that are prevalent today, more and more companies are moving into the direction of mergers and acquisitions. Middle market companies, in particular, seem to carry out these much more than larger companies, as it usually helps them grow and develop. Often, these mergers and acquisitions are part of their development strategy. (more…)