Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
So You Think You Own Preferred Stock?
It is no secret that the bulk of today's activity in the private equity sector is taken up with late rounds of financing. Typically, the VCs (ie, private equity funds, including but not limited to funds which are the incumbent in a particular company's series of preferred shares) negotiate the terms of, let's call it, the Series D round ' a so-called “follow on” round. The D Round succeeds, in point of time, the initial issuance to the following investors: common stock to the founders, friends and family and sometimes angels, followed by Series A, B and C convertible preferred shares, to the professional investors.
As VCs in the D round survey the balance sheet and capital structure, they note it is sufficiently cluttered that the company, unless it cleans up its capital structure, may be unfinanceable. And, while the majority of the holders of the A, B and C Series may be amenable to a new round of financing, the vote in favor of the term sheet suggested by the investors in the Series D round (often highly dilutive) may be less than one hundred percent. There is often an intractable, truculent holdout ' someone or some institution who or which, for one reason or another, has entirely lost confidence in the company and its management, or is otherwise disaffected. Some of the holdouts may be impervious to the argument that, absent new financing, the company will fail. “Let it fail,” may be their response. Or, alternatively, “pay me extra baksheesh to persuade me to give up my blocking position.”
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It
Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?
Judge Rules Shaquille O'Neal Will Face Securities Lawsuit for Promotion, Sale of NFTs
A federal district court in Miami, FL, has ruled that former National Basketball Association star Shaquille O'Neal will have to face a lawsuit over his promotion of unregistered securities in the form of cryptocurrency tokens and that he was a "seller" of these unregistered securities.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.
Blockchain Domains: New Developments for Brand Owners
Blockchain domain names offer decentralized alternatives to traditional DNS-based domain names, promising enhanced security, privacy and censorship resistance. However, these benefits come with significant challenges, particularly for brand owners seeking to protect their trademarks in these new digital spaces.