In which there are mergers and acquisitions, you will definitely find lawyers doing research work for their clientele. But if you are like most people, you are probably wondering what is the diligence work involved. We did a bit of research and located that you have certain research areas that only lawyers can do.
The first will be the report on legal documents. By legal documents, we mean documents that can make the marked company a legitimate entity. If its a corporation, it might be the articles of incorporation of course, if its a small liability company, it might be the LLC documents. Due to the legal jargon utilized in these documents, only lawyers with corporate law experience would know how to decipher them.
For corporations, other legal documents that must be reviewed in due diligence include good standing certificate, company bylaws, the minutes of shareholder and board of director meetings, and outstanding warrants and option agreements.
In the event the target clients are an LLC, other documents that really must be checked inside the name of homework are the articles of organization, the companys good standing certificate, operating agreement, the minutes of membership meetings, manager agreement, and outstanding purchase rights and option agreements.
The second area of concern in due diligence that lawyers tackle are the different agreements entered into with various third-parties. Legal agreements include all major contracts with distributors, suppliers, and customers, as well as confidentiality and non-compete agreements, intellectual property agreements, and equipment leases. Other agreements that must be reviewed are insurance coverages and property agreements.
The next area that corporate lawyers do in research is an assessment of license and permits. The thought the following is to ascertain regardless of whether the target clients are in compliance using the different state and native laws.
Other places which are of special concern in research work add the selection of all major assets and liabilities, UCC liens, and customer problems.
Areas we mentioned previously would be the legal aspects of concern which can be tackled during research work. There is an additional area that is certainly reviewed at the same time as the legal papers and is particularly the financial standing of the target company.
During due diligence work, federal and tax returns are reviewed. But this may not be the only real part that may be reviewed. Also reviewed would be the financial statements and tax liens.
Again when you are about to initiate a merger or acquisition deal, you should enlist assistance from a business lawyer that has experience in all of the areas we mentioned above. Precisely what the lawyers do is look into every one of the relevant documents to look for the all around health from the company along with its financial standing.
Research ought not to be overlooked as it could assist the acquiring company avoid problems down the road. Should you need assistance in locating a business lawyer, you are able to check out websites like Lawyers.com that come with peer-reviewed and client-reviewed lawyers.