Mergers and acquisitions require skilled lawyers in San Diego and throughout California.  Are you merging your company with another business?  Are you looking to buy or sell your San Diego or California business, medical practice or healthcare entity?  These transactions are legally and financially quite complex and the Watkins Firm has a proven track record of success across almost four decades.

3 Key Takeaways Why Mergers and Acquisitions Require Skilled Lawyers:

• Mergers and acquisitions are some of the most complex business and financial transactions one can undertake in the business world.
• Stock purchase transactions transfer ownership of a company itself, including all assets, liabilities, and goodwill.
• Asset purchase transactions are concerned with the sale of specific equipment, real estate, customers, assets, inventory, AP or AR, intellectual property or other business asset(s).

Stock Purchase Transactions

The transfer, merger or acquisition of a company is usually accomplished with a stock purchase.  These transactions are not only legally sophisticated, there is an art to the negotiations associated with a stock purchase.

The mergers and acquisitions attorneys at the Watkins Firm bring almost four decades of experience in these important and potentially lucrative business transactions.  We understand the crucial nature of “the deal” and represent our clients in all phases of the transaction including negotiations, crafting an effective and enforceable stock purchase agreement, due diligence and ultimately an effective conclusion which expands your business opportunities and capacity.

Our seasoned and skilled attorneys aggressively negotiate to make sure our clients achieve the best possible outcome in the transaction, while ensuring the conversations and working relationships between the parties remain positive and engaged.  Our business contract attorneys carefully craft a stock purchase contract which captures the agreements of the parties, while clearly guiding each party through the complex business transaction of acquiring another company.

Asset Purchase Agreements

In most cases, the acquisition is limited to specific assets.  An asset purchase agreement provides the ability to acquire specific assets from another business entity.  This can include anything from real estate, inventory, intellectual property, vehicles and/or equipment, inventory or even a customer base.  These transactions should be carefully structured to ensure a clear definition of the asset(s) to be acquired including substantial due diligence to ensure the status of the asset and that it is free of encumbrances.

Mergers and Acquisitions Require Skilled Lawyers and Extensive Due Diligence

The legal details, due diligence, supporting checklists and research and transactional structure are just a few of the reasons why mergers and acquisitions require skilled lawyers to ensure success.  Purchasing a San Diego or throughout California business requires experienced attorneys who can provide thorough due diligence to protect your interests and to identify all potential issues, existing disputes and contingent liabilities.

We thoroughly investigate every aspect of the transaction to ensure the claims of the other party are clearly documented and substantiated.  We work to ensure a smooth transfer of ownership which often includes retaining key employees and existing customers of the company.  It is normal to request existing ownership or management to remain in place for a period of time to ensure the transfer of Goodwill to the new ownership group.  There will usually be a “hold-back” of funds at closing which provides a cash reserve for unexpected contingencies or discrepancies which arise post-transfer.

Pro-Tip: “Well, when you have a corporation for a long time, it becomes another person, a citizen, and you get credit for that corporation that corporation can sign leases, that corporation can sign vendor contracts, it can get licenses, it can do all kinds of things that have built up over the years. Whereas if you have a brand new company, you’re guaranteeing everything. So if you want to buy a company that’s already running, you don’t have to renegotiate everything and you just come over with a good shareholder agreement and a stock purchase. You can step into the shoes of a very successful company and just hope it makes a profit.

The advantage to the buyers in a stock purchase transaction is they are stepping into the shoes of the seller.  Sellers have tax advantages in selling stock. That’s always good because a stock sale on something you’ve held for a long time, it’s going to be taxed at a better rate. Also it’s a cleaner transaction. You just sell the stock, there’s still going to be due diligence and you still have to make representations and warranties about the company. So it’s still going to be your liability if you’re not honest and truthful, but you definitely would prefer to do a stock sale.

What are some of the effective strategies?  You might request a holdover, having people work across the transition. There’s always something. And as a deal maker, that’s what a transaction lawyer is. You want to come up with creative ways to get the deal done while certain contingencies wait.  We have had money and trust accounts on deals for two years while a contingency is fulfilled by the seller. So you’ll pay 2 million for a project and there’s $200,000 coming to the company, but it’s not going to come for a while. So the seller will say, well, let’s keep the $200,000 for me in escrow until the company I’m selling gets that $200,000 and we get the deal done.  Again, getting what you’re paying for, knowing that you’re getting full disclosure, Goodwill.  The risk – people taking off and forming another company and competing with you, and also not having the expertise that the seller has. So, full disclosure and expertise. Those are probably the key things we see in whether companies we acquire are successful.” – Dan Watkins, Founding Partner

Your San Diego and Southern California Mergers and Acquisitions Team

Your experienced and proven San Diego and California mergers and acquisition team at the Watkins Firm helps to accomplish your goals while ensuring the transaction is carefully crafted, verified and executed.  If you are considering the acquisition of a San Diego or California business you need skilled and proven mergers and acquisition lawyers who will support you through the process, protect your interests and help to facilitate a successful transaction.  We invite you to review our podcast Episode 13 – Mergers and Acquisitions as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.

Meet Dan Watkins:

Daniel W. Watkins is a true people person who sincerely listens. He cares about things that occur in other people’s lives. Dan enjoys digging into the facts and finding creative solutions to problems. He is not shy about giving his opinion either.

Dan’s interest in people make him deeply invested in every relationship and his exuberant personality makes him a true litigator. Dan fights for his clients with a fierce and calculated commitment.

Dan has practiced in the areas of business, medical practices and healthcare business, high tech/science, real estate and employment defense law since 1987. He is a seasoned litigator and true trial attorney with over 50 jury and bench trials to his credit. Dan has successfully represented both large companies and individuals and achieved substantial victories in well-publicized trials throughout California and the U.S.

He is experienced in business and corporate formation and administration, as well as all forms of alternative dispute resolution, including binding arbitration and mediation.

THE ROAD TO BECOMING A BUSINESS LAWYER AND LITIGATOR

Dan has almost 40 years of experience working with, for and against some of the largest insurance companies in the country. He has successfully tried and litigated cases in the areas of Healthcare Compliance, Commercial Litigation, Unfair Business Practices, Fraud, Breach of Contract, Battery, Premises Liability, Product Defect, Medical Malpractice, Discrimination, Sexual Harassment, Construction Defect, as well as Unfair Competition, Defamation, and Trade Secrets.

In December 2003, Dan commenced litigation against Health South Surgery Centers-West, Inc and its’ subsidiaries, exposing the company’s extensive mismanagement and misconduct of its’ surgery centers. Dan has also been asked by some of California’s largest municipalities and corporations to conduct legally required investigations into matters involving alleged employment discrimination and harassment.