Lexis Practice Advisor® Practice Insights—July 2, 2015

Lexis Practice Advisor® Practice Insights—July 2, 2015

 LexisNexis partners with leading practitioners from across the country to develop Lexis Practice Advisor® practical guidance for transactional matters. Periodically InfoPro highlights the practical insights developed by these attorneys on specific topics in their area of expertise. These insights can be shared with your attorneys, used in your newsletters and on your intranet.  

Post-Closing Matters

Banking & Finance Insights by Sherry Mitchell

Once a transaction closes, the lawyer’s work is not yet done. Rather, counsel must focus on certain post-closing matters. For example, it is common that certain conditions precedent to closing were not satisfied prior to closing. Such conditions will need to be modified with the consent of the secured party to be handled on a post-closing basis. In some transactions, these post-closing items are found in a schedule to the credit agreement or memorialized in a post-closing matters agreement. Counsel must pay close attention to such post-closing items to ensure timely delivery satisfactory to the secured party. The secured party may have specific post-closing procedures regarding delivery of post-closing items or documents that need to be observed.

Learn more about post-closing matters:

Sherry Mitchell, Esq., head of Lexis Practice Advisor® Banking & Finance, brings eleven years of experience to LexisNexis®, joining the team from Clifford Chance U.S. LLP.

Lending and the Bankruptcy Code
Bankruptcy Insights by Cody Tray

Lenders considering lending to a potential debtor-in-possession must consider both the risks and benefits of doing so from both a legal and business standpoint. Lending institutions must consider an array of issues that arise in the confines of a bankruptcy proceeding. For example, in addition to traditional concerns, lenders must consider the adequacy of collateral during the pendency of the bankruptcy proceedings; the relative rights of other creditors of the debtor; and the risk that third parties could potentially obtain legal rights during the pendency of the Chapter 11 proceeding that may affect the lender’s position as a DIP lender.

Learn more about lending and the bankruptcy code:

Cody Tray, Esq., head of Lexis Practice Advisor® Financial Restructuring & Bankruptcy, brings nine years of bankruptcy experience to LexisNexis®, including experience at Davis Polk & Wardwell LLP and a clerkship with the Honorable Robert E. Gerber, SDNY Bankruptcy Judge.

Drafting a Delaware General Partnership Agreement

Business Insights by Eric Bourget

A partnership agreement governs the relations among the partners, as well as between the partners and the partnership. Although not required by law, it is recommended that partners enter into a written partnership agreement to memorialize their business arrangement. No particular provisions are required in a partnership agreement, other than the essential agreement to go into business as partners. However, the partnership cannot alter any of the non-waivable provisions contained in 6 Del. Code 15-103(b). The Delaware Revised Uniform Partnership Act governs any aspect of the partnership not covered in the agreement.

Learn more about drafting a Delaware general partnership agreement:

Eric Bourget, Esq., Lexis Practice Advisor® Team Lead and Group Director of Specialized and Corporate offerings, brings ten years of both private and in-house practice experience to LexisNexis®.

Buyer and Seller Due Diligence in Business Acquisitions

Business Insights by Eric Bourget

Due diligence is the process undertaken to assess the condition, value and other qualitative aspects of the assets and liabilities that are the subject of the proposed transaction, as well as the barriers to completing the proposed transaction. Due diligence of the target (or assets) and the seller itself is one of the most important tasks to be completed by the buyer in an acquisition. Due diligence helps the buyer to understand the assets that will be acquired and the liabilities that will be assumed as a result of the transaction. The buyer’s due diligence should also determine the regulatory and third-party filings and approvals required to complete the transaction which may impact, or may even dictate the structure and timing of the transaction. The seller will also want to conduct its own due diligence review of its business. This will prove useful in connection with negotiating the representations and warranties, preparing the related disclosure schedules and negotiating the indemnification provisions that will be included in the definitive acquisition agreement. Furthermore, if part of the consideration to be paid to the seller consists of the buyer’s securities, or if the buyer will owe obligations to the seller after closing, the seller will want to conduct its own due diligence review of the buyer. If the transaction is an all-cash deal, the seller may want to perform due diligence on the buyer’s ability to pay the purchase price before the seller incurs any significant costs in connection with the transaction.

Learn more about buyer and seller due diligence in business acquisitions:

Eric Bourget, Esq., Lexis Practice Advisor® Team Lead and Group Director of Specialized and Corporate offerings, brings ten years of both private and in-house practice experience to LexisNexis®.

 Drafting a Delaware General Partnership Agreement

In-House Insights by Eric Bourget

A partnership agreement governs the relations among the partners, as well as between the partners and the partnership. Although not required by law, it is recommended that partners enter into a written partnership agreement to memorialize their business arrangement. No particular provisions are required in a partnership agreement, other than the essential agreement to go into business as partners. However, the partnership cannot alter any of the non-waivable provisions contained in 6 Del. Code 15-103(b). The Delaware Revised Uniform Partnership Act governs any aspect of the partnership not covered in the agreement.

Learn more about drafting a Delaware general partnership agreement:

Eric Bourget, Esq., Lexis Practice Advisor® Team Lead and Group Director of Specialized and Corporate offerings, brings ten years of both private and in-house practice experience to LexisNexis®.

Staying Abreast of New PTAB Decisions with the PTAB AIA Tracker
IP & Technology Insights by Lindsay Bringardner

With the introduction of the America Invents Act (commonly referred to as the AIA) came three new proceedings before the Patent Trial and Appeal Board of the USPTO: Inter Partes Review (IPR), Post-Grant Review (PGR) and Covered Business Method Patents (CBM). Following relevant decisions and orders issued by the PTAB is crucial when counseling clients on the competitive landscape. The PTAB AIA Tracker provides easy access to key decisions and orders, organized by type of proceeding, outcome and listed in reverse chronological order.

Learn more about staying abreast of new PTAB decisions with the PTAB AIA Tracker:

Lindsay Bringardner, Esq., head of Lexis Practice Advisor® Intellectual Property & Technology, brings twelve years of legal experience to LexisNexis®, including experience at Latham & Watkins LLP and Pryor Cashman LLP.

 Retention and Bonus Agreements

Labor & Employment Insights by Carrie Wright

Companies often seek to incentivize individuals to either accept employment, or remain employed, with the company. For example, companies may offer a sign-on bonus or sign-on equity awards to encourage a desirable candidate to accept a key position. Companies may also offer short- and long-term cash incentives to influence executives to remain with the employer and/or focus on specified performance goals. Additionally, companies may offer retention agreement to certain valued employees (often executives) to encourage them to stay with the employer for a period of time, often during a period of uncertainty or transition for the employer. It is important to carefully draft the agreements providing for these incentives to ensure that the company does not have to pay the employee who has not fulfilled his or her end of the bargain, to comply with the Internal Revenue Code sections 132(m) and 409A, and to avoid other pitfalls.

Learn more about retention and bonus agreements:

Carrie Wright, Esq., head of Lexis Practice Advisor® Labor & Employment, brings nearly fifteen years of legal experience to LexisNexis®, including experience at Epstein Becker & Green, P.C., Paul, Weiss, Rifkind, Wharton & Garrison LLP and Rabinowitz, Boudin, Standard, Krinsky & Lieberman, P.C.

Key Strategies for Launching a Hostile Takeover
M&A Insights by Dana Hamada

What is the most optimal strategy for your client’s unsolicited bid for a target company? The answer depends on numerous factors, including whether your client is a strategic or a financial buyer; your client’s objectives in bidding for the target; and current market conditions. Strategies for launching a hostile takeover vary in intensity and commitment—and can involve one or more tactics, such as casual passes and bear hugs, acquisition of target’s shares in the open market, proxy contests and tender offers.

Learn more about key strategies for launching a hostile takeover:

Dana Hamada, Esq., head of Lexis Practice Advisor® Mergers & Acquisitions, brings a wealth of legal experience to LexisNexis®, joining the team from Jenner & Block LLP and Gibson, Dunn & Crutcher LLP.

Formation of Borrower Entities in Acquisition Financing Transactions
Real Estate Insights by Richard J. Sobelsohn

In commercial real estate acquisition financing transactions, it is common to form a new entity (often, a limited liability company or a limited partnership) to serve as the borrower/purchaser. Lenders frequently require borrowers to form a single purpose Delaware entity to acquire the property and act as the borrower. If such a requirement is not imposed, the borrower may prefer to organize the new entity in the state in which the subject property is located to avoid the effort, time and cost of registering the entity in two separate jurisdictions (i.e., the state in which the entity is formed and the state in which the property is located).

Learn more about the formation of borrower entities in acquisition financing transactions:

Richard J. Sobelsohn, J.D., GGP, LEED Accredited Professional, Team Lead and Group Director of Lexis Practice Advisor® Financial Practice Area Modules, brings almost sixteen years of both private and in-house practice experience to LexisNexis®.

Understanding the Regulation of Affiliated Transactions under Section 17 of the Investment Company Act
Securities Insights by Ron Llewellyn

Section 17 of the Investment Company Act of 1940 regulates the business and investment activities of a registered investment company and persons affiliated with it. Counsel to an investment company should be aware of the company’s obligations pursuant to Section 17, as well as the requirements set forth by federal statute, rule or order.

Learn more about the regulation of affiliated transactions under Section 17 of the Investment Company Act:

Ron Llewellyn, Esq., head of Lexis Practice Advisor® Securities & Capital Markets, brings a wealth of expertise to LexisNexis®, including experience at Skadden, Arps, Slate, Meagher & Flom LLP, MasterCard Incorporated and Saks Incorporated.