Always explain stock options
Stock options. Most SMB business owners or employees lack a college degree in financial instruments, so assume they know nothing
Legal
18 posts
Good legal hygiene
If you're in a legally sensitive situation: limit written communication. That's my # 1 advice for legal
When your partner dies
Kearney’s boss and senior partner died suddenly in an accident in 2018. At the time, the firm owned 4
NDA still exists after deal closed
Just because the deal closed doesn’t mean your obligations in the NDA absolved.
Efficient NDA
Amazingly efficient NDA-to-materials process: (1) Sponsor sent me a Google Form, asking for my name, entity, etc. (2) I instantly
Earnout Poetry
Earn-outs can be contingent on improved performance (growth) or stable performance (don’t decline). Earn-outs can be based on overall
Tack Excess Cash onto EV in Stock Purchase
In a stock purchase, tack the available cash of the business onto the purchase price and ask the seller to
Non-Circumvention for Investors
NDAs with prospective investors should include a non-circumvention provision. I have sadly seen it happen twice that a (larger, institutional)
Board Meeting Cheat Sheet
This is my board meeting cheat sheet. For some reason I am unable to memorize these lines, which are good
Minority Recaps Enabled By Flexibility
The vast majority (99%+) of independent sponsors deals are majority acquisitions, but in the off-chance that you're working
Reverse Earn-Out
Reverse earn-out: a seller note that is forgivable if performance declines. It’s usually named as a “seller note” in
Exit Fee for Independent Sponsors
Everyone knows the three standard pillars of independent sponsor economics (closing fee, management fee, carried interest). How about an exit
QSBS: Pay Zero Capital Gains Tax
QSBS: pay zero capital gains tax. A heavy argument in favor of structuring your newly acquired entity as a C-Corp
Crushing Victory in Court
A few months ago, I won a crushing victory in court. My takeaways: (1) The justice system isn't
Presenting Purchase Agreement
When I deal with a business owner, this is how I roll out the legal purchase agreement: “We will send
BOI Filing Requirement
Happy Thanksgiving week to all, except the bureaucrats at FinCEN who mandated the filing of BOI (Beneficial Owner Information) reports
Generalist Attorneys Within M&A
I light a candle for those who are dealing with generalist attorneys within M&A 🕯️ Seller: “My attorney has
Document everything
If you’ve just acquired a business and things don't feel quite right, start a document where you
