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.
The Credit Agreement: Negative Covenants Banking & Finance Insights by Sherry Mitchell
The negative covenants section of the credit agreement is usually highly negotiated. These provisions are often unique to each transaction and vary based on the size of the facility, the borrower’s credit profile, the borrower’s industry and other factors. However, each negative covenant has the same basic structure: a general prohibition followed by listed exceptions referred to as baskets or carve-outs. In negotiating the exceptions, the parties must balance the operational needs of the borrower, its capital structure and plans for growth with the protections lenders will need to participate in the transaction.
Learn more about the credit agreement: negative covenants:
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.
Creditors’ Committees Bankruptcy Insights by Cody Tray
The creditors’ committee is an essential and fundamental player in most Chapter 11 cases and has numerous roles during the case. The precise role of the creditors’ committee varies depending on the facts and circumstances of the case, as does the formation process and selection criteria of the creditors’ committee. Although every case is unique, there are certain milestones that generally occur that can result in tension between the creditors’ committee and the debtor or other stakeholders, including the debtor’s obtaining DIP financing, section 363 asset sales, and the Chapter 11 plan process. Having an understanding of all of the nuances pertaining to the creditors’ committee will help you navigate these complex matters for your clients and negotiate in their best interests.
Learn more about creditors’ committees:
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.
Dissolving a Delaware Corporation
Business Insights by Eric Bourget
In most cases, a Delaware corporation may dissolve only upon approval of holders of a majority of the outstanding voting shares, subject to certain exceptions: 1. A corporation that has not yet issued shares or not yet begun business activities may dissolve by a vote of a majority of directors or, if there are no directors, of a majority of incorporators; 2. A close corporation may dissolve upon the demand of any stockholder or stockholders designated as having such power in its articles of incorporation; 3. A joint venture corporation having only two stockholders may petition the Court of Chancery for dissolution in accordance with Delaware law. Corporations continue to exist after dissolution for the purpose of winding up their affairs. Directors and officers retain limited authority to perform the actions necessary for this purpose.
Learn more about dissolving a Delaware corporation:
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 California Settlement Agreement
The goal of most negotiated settlements is to achieve a final resolution of all issues between the parties. It is crucial that all material terms of the settlement are memorialized in the settlement agreement, with special care taken to include all details necessary to avoid any unforeseen consequences. A primary component of a settlement agreement is the release clause, which must be clear and unambiguous and accurately express the intent of the parties. It is important that all appropriate parties are included in the settlement so that the claim can be disposed of in its entirety and forever. California also allows and enforces private, voluntary releases and express assumptions of risk in which one party agrees to waive rights to redress a claim or loss that has yet to occur.
Learn more about drafting a California settlement agreement:
In-House Insights by Eric Bourget
Technology Transfer with an Academic Institution or National Laboratory IP & Technology Insights by Lindsay Bringardner
With the rise of the U.S. technology sector over the past two decades, more and more universities are turning to technology transfer as a source of revenue and for building relationships with non-academic entities. National laboratories are even required by federal law to engage in technology transfer to state and local governments and the private sector. When advising private companies entering into technology transfer deals with universities or national laboratories, it is important to understand the unique benefits, challenges and nuances of such an arrangement. It is particularly productive for all parties to fully understand the types of provisions that may or may not be negotiable in these technology transfer arrangements.
Learn more about technology transfer with an academic institution or national laboratory:
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.
Federal Contractors Labor & Employment Insights by Carrie Wright
Employers who provide goods or services to, or receive funds from, federal agencies may be considered federal contractors. Federal contractors must comply with various requirements that do not apply to their non-federal government contractor counterparts. These include additional non-discrimination requirements; the duty to develop and maintain Affirmative Action Plans; and certain data collection and recordkeeping obligations.
Learn more about federal contractors:
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.
Managing Antitrust Risk in M&A Deals M&A Insights by Dana Hamada
If the monetary size of an M&A deal or the market size of the parties exceeds certain dollar thresholds, the proposed transaction will be subject to mandatory review by antitrust authorities in the U.S. and possibly abroad. In addition to the closing risk associated with the review process, practitioners also need to understand how to minimize the risk of “gun-jumping” and increasing the scrutiny of antitrust regulators from the early stages of a deal.
Learn about managing antitrust risk in M&A deals:
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.
Lender Protections Relating to a Borrower’s Bankruptcy Real Estate Insights by Richard J. Sobelsohn
In real estate financing transactions, lender’s counsel should ensure that the loan documents contain certain provisions to protect the lender should the borrower suffer financial difficulty. For example, it is important for the loan documents to include appointment of receiver, jury trial waiver, consent to jurisdiction and reservation of rights clauses. Such provisions can help protect the lender’s rights and remedies if a bankruptcy scenario arises for the borrower.
Learn more about lender protections relating to a borrower’s bankruptcy:
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®.
Commencing the Tender Offer Securities Insights by Ron Llewellyn
Once a cash tender offer is set to commence, a summary advertisement known as a “tombstone ad” is typically published, followed by the filing of Schedule TO and related exhibits with the SEC. Learn more about commencing the tender offer:
Commencing the Tender Offer
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.