Myrtle Beach Non-Profit Attorneys & Lawyers

Key Takeaways

• Legal due diligence ensures informed decisions in mergers, acquisitions, and major business transactions.
• It includes reviewing corporate documents, contracts, intellectual property, and potential legal risks.
• A clear process, including planning, document analysis, and legal review, enhances accuracy and reduces liability.
• Specialized tools and professional legal support can streamline the investigation and reporting process.
• Thorough due diligence can expose hidden liabilities and strengthen negotiating positions.

What is Legal Due Diligence

Legal due diligence is an investigation into a business by re viewing documents and interviewing employees. A legal due diligence investigation is completed when a business or investor is interested in buying a business or investing in that business.

A legal due diligence investigation is seeking information about the business to make sure that the invest

...

Key Takeaways

• A preferred return sets a priority payout rate (often 8–10%) that investors must receive before sponsors share in profits.
• It ensures investors recover a baseline return before any performance-based profit split occurs.
• Preferred returns may be simple or compounding, and cumulative or non-cumulative, influencing how unpaid returns accrue over time.
• Key variations include True vs. Pari Passu, Lookback, and Catch-Up provisions that determine distribution order.
• Preferred return differs from preferred equity, which gives investors repayment

...

Key Takeaways

• Tag along rights, also known as co-sale rights, protect minority shareholders by allowing them to sell their shares on the same terms as majority shareholders.
• They are commonly included in shareholder or stockholder agreements to ensure fairness during company sales or ownership changes.
• These rights encourage investment by offering minority investors exit opportunities if majority holders sell their stakes.
• Properly drafted clauses should define triggering events, notice requirements, and proportional sale rights to avoid disputes.
• Balancing tag along and drag along rights is essential to prevent conflicts between majority control and minority protectio

...

Key Takeaways

• A condition subsequent is an event or circumstance that, once triggered, ends an existing contractual obligation.
• The purpose of a condition subsequent is to serve as an exit clause, protecting a party from unforeseen circumstances.
• A condition precedent is the opposite—something that must occur before contractual duties take effect.
• Condition subsequent clauses must be written with clear, precise language, as courts interpret them strictly.
• Common uses include real estate transactions, employment contracts, insurance agreements, and commercial deals.
• Parties must consider burden of proof, tim

...

Key Takeaways

• A key man clause suspends new investments if named executives or managers are unavailable due to death, disability, departure, or other disqualifying events.
• It protects investors by ensuring qualified leaders are actively managing funds, and reassures limited partners of operational stability.
• The clause is common in private equity, venture capital, hedge funds, and even creative industries like music, where leadership roles are essential.
• Key man clauses are often paired with key person insurance and a written contingency plan to reduce financial and operational risk.
• Negotiations typically focus on which individuals trigger the clause, the number of de

...