COURSE DESCRIPTION
A client investment in an operating business, particularly a minority stake, is only as good as its liquidity rights. If a client cannot readily sell his or her ownership stake at fair market value, it has little real value. The key to ensuring liquidity is contractually creating a private market for the ownership stake. This market can come in the form of requiring other stakeholders, including the majority owner, to buy the minority stake at a mutually agreeable price, or creating other mechanisms for selling the stake to third parties. Without these contract rights, a stakeholder has no liquidity and is stuck. This program will provide you with a practical to planning and drafting contractual liquidity rights in closely held companies.
- Planning and drafting liquidity rights in closely held companies
- Counseling clients about the limitations and risks of liquidity in closely held companies
- Framework of alternatives for determining most appropriate liquidity rights
- “Texas standoff” or “Russian roulette” – opportunities, risks and tradeoffs
- Drafting “tag-along” and “drag-along” rights – practical uses and drawbacks
- How to think about valuing closely held ownership stakes
Speaker:
Michael Weiner is a partner in the Denver office of Dorsey & Whitney, where he is head of the firm’s corporate department. His practice focuses on the representation of emerging growth companies in the areas of corporate formation, mergers and acquisitions, venture capital and angel finance, public offerings, and securities regulation. He counsels boards of directors and management teams in the areas of equity compensation, corporate governance, Sarbanes-Oxley and other regulatory and disclosure matters. He also advises clients on intellectual property licensing and commercial contract matters. Mr. Weiner earned his B.S. in economics from the University of Pennsylvania Wharton School of Business, his B.A. in American history from the University of Pennsylvania College of Arts & Sciences, and J.D. from the University of California, Los Angeles.