Selling Your Company? Here’s a Legal Checklist
by Scott Edward Walker on May 27th, 2020
I’ve been handling M&A transactions for 20+ years, including nearly eight years at two major New York City law firms. During that period, I have seen numerous significant mistakes made by founders and entrepreneurs in the context of selling their company. Accordingly, I thought it would be helpful to provide a checklist of key issues, which includes links to prior posts for a more detailed discussion. If you have any questions, please ping me at .
- Execute a confidentiality agreement with each potential buyer (see mistake #1 here and this post here).
- Discuss the necessity of an investment banker with legal counsel (see this post here and tip #7 here).
- Watch-out for financial, as opposed to strategic, buyers (see this post here).
- Negotiate a letter of intent which addresses all material issues (see mistake #2 here and post here).
- Cap your liability at 10-20% of the purchase price (see tip #2 here).
- Push for a large, broad “basket” (see tip #7 here).
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Require the buyer to pay a reverse termination fee (see mistake #3 here and tip #10 here).
- Include a non-reliance provision in the acquisition agreement (see tip #3 here).