Mergers & Acquisitions

Jahanshahi Law Firm advises business owners, private companies, investors and entrepreneurs on the purchase and sale of privately held businesses.

We act on transactions from the earliest stages of negotiation through due diligence, definitive agreements, closing and post-closing matters. Our focus is not simply on documenting a transaction. It is on understanding the commercial objective, identifying the issues that can materially affect value or execution, and negotiating a deal structure that protects the client without losing sight of what matters commercially.

For an owner selling a business, the transaction may represent the culmination of decades of work and a significant part of the owner’s accumulated wealth. For a purchaser, an acquisition may involve a substantial deployment of capital and the assumption of operational, contractual and financial risk. In either case, the legal work should reflect the significance of the transaction.

Buying a Business

We advise purchasers on acquisitions structured as share purchases, asset purchases and other negotiated business combinations.

Our involvement often begins with the letter of intent. Decisions made at that stage can materially affect the purchaser’s negotiating position later in the transaction, particularly in relation to price adjustments, working capital, exclusivity, financing conditions, due diligence, restrictive covenants and the allocation of risk.

Once the principal business terms have been established, we conduct legal due diligence with the objective of understanding what the purchaser is actually acquiring and identifying matters that may affect valuation, closing or the operation of the business following completion.

Depending on the transaction, our review may include corporate records, ownership and capitalization, material customer and supplier contracts, commercial leases, debt and security arrangements, employment matters, litigation, intellectual property, regulatory matters and other significant obligations of the target business.

The purpose of due diligence is not simply to identify deficiencies. It is to determine what should be done about them. A material issue may justify a change to the transaction structure, a purchase price adjustment, a closing condition, a specific indemnity, a holdback, additional security or, in some circumstances, a decision not to proceed.

We negotiate the purchase agreement with the same commercial focus. Particular attention is given to the representations and warranties, indemnification regime, liability limitations, purchase price adjustments, earn-outs, restrictive covenants, closing conditions and post-closing obligations that determine how transaction risk is ultimately allocated between the parties.

Where the acquisition is financed, we coordinate the corporate transaction with the lender and financing counsel. Where new ownership arrangements are required following closing, we can also advise on shareholder agreements and the governance structure of the acquired business.

Selling a Business

We represent business owners and shareholders in the sale of privately held companies and business assets.

A successful sale begins before the purchase agreement is negotiated. Where appropriate, we work with the seller in advance of the transaction to identify and address issues that could become problematic during purchaser due diligence.

This may include deficiencies in the corporate minute book, undocumented shareholder arrangements, outstanding shareholder loans, incomplete contracts, ownership issues, change-of-control restrictions, commercial lease matters or other issues that could create unnecessary leverage for the purchaser once negotiations are underway.

During the transaction, we assist with the letter of intent, disclosure process, due diligence responses and negotiation of the definitive purchase agreement and closing documents.

For a seller, one of the central legal issues is determining how much liability remains after the business has been sold.

The headline purchase price does not tell the entire story. A transaction can become significantly less attractive if the seller remains exposed to broad representations and warranties, uncapped indemnification obligations, substantial holdbacks, aggressive working capital adjustments, uncertain earn-out provisions or unnecessarily restrictive post-closing covenants.

We therefore pay particular attention to the seller’s continuing obligations after closing and negotiate the transaction with a view to achieving an appropriate degree of finality.

Where the transaction involves an earn-out, vendor take-back financing, deferred consideration, escrow or holdback, we focus carefully on the mechanisms governing payment and the circumstances in which amounts can be withheld, reduced or disputed.

Transaction Structure

The decision to structure a transaction as a share purchase or an asset purchase can have significant legal, tax and commercial consequences.

In a share purchase, the purchaser acquires ownership of the corporation itself. The corporation ordinarily continues to own its assets, remain party to its contracts and remain subject to its existing liabilities. As a result, due diligence and contractual risk allocation assume particular importance.

In an asset purchase, the purchaser acquires specified assets and assumes specified liabilities. The transaction may require the assignment of contracts, leases, licences and permits and may raise additional issues concerning employees, inventory, intellectual property, real property and other operating assets.

The preferred structure is often driven substantially by tax considerations. We work closely with the client’s accountants and tax advisors so that the legal transaction documents properly implement the structure that has been selected.

Where pre-closing or post-closing reorganizations are required, we can implement corporate steps arising from the tax plan, including share exchanges, rollovers, holding-company structures, amalgamations, dividends, redemptions and other corporate reorganizations.

Negotiating the Deal

Sophisticated M&A work requires judgment about where legal risk is worth negotiating and where it is not.

Purchase agreements can contain hundreds of provisions, but only a limited number will materially affect the economics or risk profile of a particular transaction. Our approach is to identify those provisions early and concentrate negotiating effort where it creates meaningful value for the client.

That may mean negotiating the definition of working capital rather than debating immaterial boilerplate. It may mean requiring a specific indemnity for an identified liability rather than attempting to solve the issue through general representations. It may mean insisting on certainty around an earn-out formula or determining that a particular diligence issue should be reflected directly in the purchase price.

The objective is not to produce the longest agreement or the largest number of comments. It is to negotiate the right agreement for the transaction.

Coordinating the Transaction

Business acquisitions and sales rarely involve legal counsel alone.

We regularly work alongside accountants, tax advisors, lenders, wealth planners, business brokers and other professional advisors involved in the transaction. Our role is to coordinate the legal aspects of the deal with the broader transaction structure and ensure that the documentation, closing mechanics and corporate steps operate together.

This becomes particularly important where the transaction forms part of a larger succession, estate or tax-planning strategy.

Counsel for Significant Business Transactions

Our M&A practice is designed for business owners and investors who want counsel who can understand both the legal documentation and the commercial transaction behind it.

We advise clients from the initial negotiation through closing, helping them evaluate risk, structure the transaction, negotiate the principal agreements and resolve the issues that inevitably arise between signing and completion.

Whether you are preparing to sell a business you have built over many years, acquiring a company as part of a growth strategy, purchasing a business with other investors or completing a strategic transaction between existing shareholders, our objective is the same: to provide disciplined, commercially focused legal advice that protects the value of the transaction and helps get the deal completed on the right terms.

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