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The Basics of Representations and Warranties Insurance for M&A

Representations and warranties (R&W) insurance, once reserved for public company and higher-market mergers and acquisitions, is becoming more prevalent in lower middle-market private company M&A transactions. Recent trends show that R&W insurance, which provides liability coverage for breaches of representations and warranties made by a seller in an M&A deal, is now being used in an estimated 25% of Read More

5 Mistakes Sellers Make During the M&A Deal Process

Successful M&A deals don’t just happen by accident. Each M&A transaction has its own complexities and numerous factors must converge to result in a mutually beneficial outcome for both the buyer and seller. Sellers who are willing to critically analyze a deal objectively and possess the gravitas to have tough conversations with buyers stand the best chance of obtaining an optimal outcome for themselves and Read More

Congressional Stimulus Bill Expands PPP; Clarifies Taxation of PPP Loan Forgiveness and Deductibility of Expenses

Congress finally reached agreement and passed on December 21, 2020 a $900 billion economic stimulus bill, which was signed into law by the President on December 27, 2020. Among other things, the bill expands and clarifies the Paycheck Protection Program (“PPP”), as amended, which was originally passed under the Coronavirus Aid, Relief, and Economic Security Act (CARES) on March 27, 2020: Expands the PPP to Read More

Section 1202 and Qualified Small Business Stock

Planning for the most favorable tax treatment on their investment is always a major consideration for investors. Because of a renewed interest in using C corporations as investment vehicles as a result of the reduction to the corporate tax rate to 21% under the Tax Cuts and Jobs Act of 2017, investors have shown a renewed interest in the potential tax benefits under Section 1202 of the Internal Revenue Code (IRC), Read More

Understanding and Structuring Board Observer Rights

Venture capital firms and other equity investors commonly request the right to have an observer attend the board of director meetings of their portfolio companies. A board observer isn’t a director, and therefore doesn’t have voting rights, generally doesn’t have a fiduciary obligation to the company or its shareholders, and typically doesn’t have the same right to indemnification to the same extent as actual members Read More

Accredited Vs. Non-accredited Investors: Avoiding The Pitfalls

When seeking investors, entrepreneurs and business owners may be approached by individuals, including friends and family, who do not qualify as “accredited investors” under securities laws. Depending on where a business is in its lifecycle, accepting funds from these types of individuals may range from appealing to essential, or a business owner may simply desire to include them in the investment opportunity. Read More

5 Tips for Choosing the Right Private Equity Partner

You’re ready to sell your business or bring on a major investor, have hired a knowledgeable investment banker to manage the process, and now you’re entertaining one or more offers from interested private equity (PE) firms. Choosing the right PE partner is one of the most critical decisions for any founder or CEO, and the relationship will be for the long haul. Before you sign up for the highest valuation offered, Read More

SBA Releases New PPP Loan Forgiveness Guidance

On August 4, 2020, the Small Business Administration (SBA), in consultation with the Department of the Treasury, released Frequently Asked Questions (FAQ) to address borrower and lender questions regarding Paycheck Protection Program (PPP) loan forgiveness. Borrowers and lenders may rely on the guidance provided in the FAQ as the SBA’s interpretation of the Coronavirus Aid, Relief, and Economic Security Act (CARES Read More

Oliver Luck vs. Vince McMahon: Key Takeaways For Executives/Companies Negotiating Employment Agreements (as published in Forbes)

Oliver Luck Vs. Vince McMahon: Key Takeaways For Executives/Companies Negotiating Employment Agreements (as published in Forbes) The recently filed Oliver Luck v. Vince McMahon lawsuit is a high-profile case between nationally known businessmen (particularly McMahon), but there are everyday takeaways that can serve any company or executive well when negotiating high-stakes employment contracts. Namely, Luck Read More

Congress Passes Bill Amending PPP Loan Forgiveness Requirements

Congress recently passed and the President is expected to sign into law the “Paycheck Protection Program Flexibility Act of 2020”, which amends certain requirements of the Paycheck Protection Program (“PPP”) passed under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The new law is primarily intended to make it easier for PPP loan recipients to achieve loan forgiveness under the program. Read More