corporate-ma

name

corporate-ma

description

Corporate transactions and M&A legal practice skill. Use when the user needs assistance with mergers, acquisitions, due diligence, entity formation, shareholder agreements, stock purchase, asset purchase, corporate governance, or SEC filings. Triggers on keywords like "merger", "acquisition", "M&A", "due diligence", "shareholder agreement", "stock purchase", "asset purchase", "corporate formation", "LLC", "bylaws", "board resolution", "SEC filing".

Corporate & M&A

This skill provides expert guidance for corporate transactions, governance, and mergers & acquisitions.

Core Capabilities

1. Entity Formation

• Choice of entity analysis
• Formation documents
• Governance structures
• Operating agreements/bylaws

2. M&A Transactions

• Deal structuring
• Due diligence coordination
• Transaction documents
• Closing mechanics

3. Corporate Governance

• Board procedures
• Shareholder rights
• Fiduciary duties
• Compliance programs

4. Securities Compliance

• Private placements
• SEC filings
• Blue sky compliance
• Disclosure requirements

Entity Selection Matrix

Entity Type	Liability Protection	Tax Treatment	Governance	Best For
C Corporation	Full	Double taxation	Formal	VC-backed startups, public companies
S Corporation	Full	Pass-through	Formal	Small businesses, limited shareholders
LLC	Full	Flexible	Flexible	Most private businesses
LP	GP unlimited, LP limited	Pass-through	Partnership agreement	Investment funds, real estate
LLP	Partial (varies by state)	Pass-through	Partnership agreement	Professional services
Sole Proprietorship	None	Pass-through	N/A	Side businesses, testing ideas

M&A Transaction Types

Stock Purchase vs. Asset Purchase

Factor	Stock Purchase	Asset Purchase
What transfers	Equity ownership	Selected assets/liabilities
Liabilities	All transfer (including unknown)	Only assumed liabilities
Contracts	Generally transfer	Require assignment/consent
Tax to Seller	Capital gains (usually)	Ordinary income + capital gains
Tax to Buyer	No step-up in basis	Step-up in basis
Complexity	Simpler documents	More complex, schedules
Third-party consents	Fewer required	More required
Best for	Clean targets, tax efficiency	Cherry-picking assets, limiting liability

Merger Structures

Forward Merger:
Target → Acquirer (Target disappears)

Reverse Merger:
Acquirer Sub → Target (Sub disappears, Target survives)

Forward Triangular Merger:
Target → Acquirer Sub (Target disappears into Sub)

Reverse Triangular Merger:
Acquirer Sub → Target (Sub disappears, Target survives as subsidiary)

Due Diligence Framework

Corporate/Organizational

• Charter documents (certificate of incorporation, bylaws)
• Good standing certificates
• Board/shareholder minutes and consents
• Capitalization table and stock ledger
• Shareholder agreements, voting agreements
• Subsidiary structure and organizational chart

Financial

• Audited financial statements (3 years)
• Interim financial statements
• Projections and budgets
• Working capital analysis
• Debt instruments and guarantees
• Tax returns and tax positions

Material Contracts

• Customer contracts (top 10-20)
• Supplier/vendor contracts
• License agreements (IP, technology)
• Real estate leases
• Equipment leases
• Joint venture/partnership agreements

Employment/Labor

• Employment agreements (executives)
• Compensation and bonus plans
• Equity incentive plans
• Employee handbook and policies
• Benefit plan documents
• Union agreements, NLRB matters

Intellectual Property

• Patent portfolio and applications
• Trademark registrations
• Copyright registrations
• Trade secrets inventory
• IP licenses (in and out)
• IP assignment agreements

Litigation/Regulatory

• Pending litigation
• Threatened claims
• Government investigations
• Regulatory filings and correspondence
• Settlement agreements
• Insurance policies and claims history

Compliance

• Permits and licenses
• Environmental compliance
• Data privacy compliance
• Industry-specific regulations
• FCPA/anti-corruption
• Export controls

Transaction Documents

Stock Purchase Agreement - Key Sections

1. Purchase and Sale: Stock being purchased, price, structure
2. Representations and Warranties: Seller and Company reps
3. Covenants: Pre-closing and post-closing obligations
4. Conditions to Closing: What must occur before closing
5. Indemnification: Allocation of risk for breaches
6. Termination: How deal can be terminated
7. Miscellaneous: Standard boilerplate

Key Negotiation Points

Issue	Buyer Position	Seller Position
Rep Scope	Broad, detailed	Narrow, qualified
Knowledge Qualifier	Actual + constructive	Actual only
Materiality Scrape	Full scrape	No scrape
Indemnity Cap	High (50-100% of purchase price)	Low (10-20%)
Indemnity Basket	Low deductible	High deductible
Survival Period	Long (3-6 years)	Short (12-18 months)
Escrow	Large (10-15%)	Small or none
Earn-out	Tied to conservative metrics	Tied to achievable metrics

Representation & Warranty Insurance

Coverage: Buyer-side policy covering breaches of seller reps Benefits:

• Allows lower escrow/indemnity
• Cleaner exit for sellers
• Differentiated bid in competitive process

Typical Terms:

• Retention: 1% of enterprise value
• Premium: 2-4% of coverage
• Policy period: 3-6 years

Closing Mechanics

Closing Checklist Categories

1. Corporate approvals (board, shareholder)
2. Third-party consents
3. Government filings (HSR, state)
4. Financing conditions
5. Bring-down certificates
6. Closing deliverables

Funds Flow

1. Buyer deposits purchase price to escrow
2. Escrow agent confirms receipt
3. Closing occurs (documents exchanged)
4. Escrow agent releases funds per flow memo:
   - Payoff existing debt
   - Pay transaction expenses
   - Fund escrow holdback
   - Distribute to sellers

Corporate Governance

Board of Directors

Fiduciary Duties:

• Duty of Care: Informed decision-making, business judgment rule
• Duty of Loyalty: No self-dealing, corporate opportunities
• Duty of Good Faith: Honest belief actions benefit corporation

Board Actions:

• Meetings (notice, quorum, voting)
• Written consents (unanimous in some states)
• Committees (audit, compensation, nominating)

Shareholder Rights

Fundamental Changes Requiring Approval:

• Mergers and acquisitions
• Charter amendments
• Sale of substantially all assets
• Dissolution

Protective Provisions (typical for preferred stock):

• Changes to authorized shares
• Changes to preferences
• Issuance of senior securities
• Dividends/distributions
• Redemptions
• Board composition changes

SEC Filing Requirements

Form Types

Form	Purpose	When Required
S-1	IPO registration	Going public
10-K	Annual report	Annually (60-90 days after FYE)
10-Q	Quarterly report	Quarterly (40-45 days after quarter)
8-K	Current report	Within 4 business days of event
DEF 14A	Proxy statement	Before shareholder meeting
Form 4	Insider trading	Within 2 business days
Schedule 13D	Beneficial ownership (>5%)	Within 10 days

Material Events Requiring 8-K

• Entry into material definitive agreement
• Completion of acquisition or disposition
• Material impairments
• Changes in control
• Departure of directors/officers
• Amendments to charter/bylaws
• Bankruptcy

Integration with Other Skills

• due-diligence: Transaction due diligence process
• contract-lifecycle: Transaction document review
• tax-law: Tax structuring of transactions
• compliance-tracking: Regulatory compliance
• legal-research: Precedent and statutory research

Reference Files

For detailed checklists and templates:

• references/due-diligence.md - Comprehensive DD checklist
• references/deal-documents.md - Transaction document guide
• references/sec-filings.md - SEC compliance reference