The equipment was secured by a seller debt. As part of the deal the seller leased the encumbered equipment to the buyer. After seller repossession, the buyer unsuccessfully claimed that it owned the equipment. M&A Stories February 28, 2023 Introduction…
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ASSET BUYER ARGUES THAT IT WAS NOT BOUND BY SELLER’S SUPPLY CONTRACT
The supplier says that the buyer impliedly assumed the contract by accepting office and cleaning supplies for five years after the closing at the contract’s price. M&A Stories January 23, 2023 Introduction When purchasing the assets of a business, buyers…
BUYER FACES $279K CLAIM FROM SELLER’S UNION IN ASSET PURCHASE OF CONCRETE MANUFACTURER
The buyer knew about the seller’s union debt before closing. The fight is over whether the concrete manufacturing business of the buyer after the closing was substantially the same as the seller’s concrete manufacturing business. M&A Stories January 17, 2023…
COURT ALLOWS BUSINESS SELLER TO DEDUCT $2.6 MILLION DAMAGES FROM BUYER’S NOTE, IGNORING BANK’S SUBORDINATION AGREEMENT
Surprisingly, a California Court of Appeals ignores a bank’s rights under a subordination agreement M&A Stories December 23, 2022 Introduction In a recent case, a California Court of Appeals made a surprising decision by disregarding a bank’s rights under a…
BUYER’S WARRANTY PROMISE EXPOSES LEGAL CONSEQUENCES IN MANUFACTURER’S ASSET ACQUISITION
A New Hampshire federal district court permitted the distributor to pursue a claim against the buyer based upon its assurances made to the distributor before closing. The buyer did not tell the distributor that its responsibility to fix printers sold…
COURT ALLOWS $315 MILLION ACQUISITION OF GEORGIA SUGAR REFINERY TO PROCEED DESPITE ANTITRUST CONCERNS
The court did not buy the government’s argument that the acquisition would give the buyer “roughly 75% of the sugar sales in the Southeastern United States.” M&A Stories October 14, 2022 In recent times, there is a growing risk of…
BUYER OF SEARS ASSETS IN 2019 ACQUISITION NOT RESPONSIBLE FOR SEARS’ 2015 CUSTOMER WARRANTY LAWSUIT
The buyer, in the asset purchase agreement, assumed warranty obligations owed to pre-closing sales made to Sears customers, except for customer claims made prior to the closing date. M&A Stories October 10, 2022 Introduction In 2019, the buyer of Sears…
BUYER OF VETERINARY SURGICAL BUSINESS ASSETS ACQUIRES RESTRICTIVE COVENANTS FROM EMPLOYEE’S EMPLOYMENT AGREEMENT
The seller’s employee unsuccessfully argued that his restrictive covenants could not be assigned to the buyer without his consent. M&A Stories October 5, 2022 Introduction In the world of mergers and acquisitions, when a buyer purchases a business, they often…
DELAWARE COURT RULES AGAINST MEDICAL DEVICE SELLERS’ EARNOUT CLAIM
The Delaware Court of Chancery holds that the buyer of the medical device used “good faith” and “commercially best efforts” to commercialize the sellers’ medical device. M&A Stories September 29, 2022 Introduction In a recent case, the Delaware Court of…
Posted in problems with earnouts Tagged with: Commercialization efforts, Commercially best efforts, Contingent payment structure, Delaware Court of Chancery, Discontinuation of development, Earn-out payments, Earnout claim, Good faith, Legal dispute, M&A legal, Medical device sellers, Milestone payments, Patient safety concerns, Product development challenges, Verdict
UNSECURED CREDITORS DISPUTE $36 MILLION SALE OF DISTRESSED SNACK MAKER BEFORE BANKRUPTCY
The seller’s unpaid creditors contend that other potential strategic partners were willing to pay between $42 million and $51 million for the seller. M&A Stories September 26, 2022 Introduction Selling a financially distressed business involves unique risks for both the…
Posted in problems with creditors of distressed business Tagged with: $36 million sale, bankruptcy, bankruptcy sale, Breach of fiduciary duty, Corporate governance, Dispute, Distressed snack maker, Financial difficulties, Lawsuit, M&A legal, Piercing the corporate veil, Private equity firm, Section 363 sale, successor liability, Unsecured creditors
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