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ESCROW IN M&A and VENTURE CAPITAL – AND OTHER USES

20th March 2024

WHAT IS ESCROW? WHY SHOULD YOU KNOW ABOUT IT? Escrow agreements are used where something is deposited with an independent third-party until certain conditions are fulfil...

INTERNATIONAL CONTRACTS – ENFORCEMENT BASICS

31st January 2024

COURT JUDGMENTS AND ARBITRATION AWARDS When you are negotiating an agreement, you always need to think about enforcing it if the other parties breach the contract - es...

M&A: UNDERSTANDING WARRANTIES AND DISCLOSURES

21st December 2023

This comes up in every M&A deal. Typical deal structure: the Buyer and Seller have discussions and sign an NDA; they sign a Letter of Intent/Term Sheet (it’s...

NEGOTIATING WITH DIFFERENT TYPES OF INVESTORS

21st September 2023

KEY POINTS ON THE NEGOTIATING BEHAVIOUR OF INVESTORS: • Funds: remember they are investing other people’s money. They will get a due diligence report from a...

POST M&A INTEGRATION DON'T LET TRADEMARKS LAPSE

22nd August 2023

This is a short story. The message sounds obvious when you hear the story but it wasn’t obvious to the company affected. One of the companies I advise sells eng...

SAFES IN MORE DETAIL AND OUR FREE DOWNLOAD SAFE

21st March 2023

The safe is a cool concept invented in Silicon Valley for start-ups raising seed finance. It simplifies things a lot and saves the company costs. In fact it’s simi...

WHAT IS A SAFE? HOW IS IT DIFFERENT FROM A CONVERTIBLE LOAN NOTE?

20th January 2023

SAFE STANDS FOR “SIMPLE AGREEMENT FOR FUTURE EQUITY”. The investor pays money into the company and his money converts into shares on certain events. SO H...

M&A: SELLING TO A COMPETITOR

20th December 2022

In many M&A and investment deals, the most likely buyer turns out to be a competitor. Often this can be a better option than a private equity investment. However there is...

TECH START UP SHAREHOLDERS AGREEMENT - CHECK-LIST

25th June 2022

Under Downloads you can see we’ve added a checklist for the shareholders agreement for a tech start up. Initially I was going to do a really simple checklist for...

WHY IS THERE A FREE SHAREHOLDERS AGREEMENT ON OUR WEBSITE?

31st March 2022

It’s simple – and this is going to be one of the shortest blogs I’ve done. This is aimed at founders of a business. Is it essential for a start-up...

DO STARTUPS NEED A SHAREHOLDERS AGREEMENT?

22nd December 2021

The answer is – yes. But growing companies often don’t have the budget and they focus on the business not the shareholders agreement, which is totally under...

CREDITORS ABILITY TO SUE DIRECTORS HAS JUST INCREASED

25th September 2020

Directors now have an increased risk of being sued following a major decision by the UK Supreme Court in mid-July this year (Sevilleja v Marex Financial). Creditors who a...

IS VENTURE CAPITAL IN TROUBLE – REPAIRING BALANCE SHEETS

20th July 2020

It’s not a crisis but lots of venture capital companies are facing difficulties at the moment. Why: • Some investee companies are passing into other owne...

HOW TO USE E-SIGNATURES FOR CONTRACTS (Hong Kong)

10th June 2020

Is an e-signature valid in Hong Kong? What are the best tips for using e-signatures? Hong Kong’s Electronic Transactions Ordinance (ETO) permits e-signatures for...

PRIVATE EQUITY 2020 – IS VENTURE CAPITAL THE FUTURE?

15th February 2020

The Economist (weekly comment piece, 30th January 2020) highlighted the trend of more and more capital flowing into private markets. They published figures from 2019 show...

What is a SAFE?

15th August 2019

SAFE STANDS FOR “SIMPLE AGREEMENT FOR FUTURE EQUITY”. I often call it a convertible loan note where the debt has been stripped out. The convertible note ha...

WHAT IS A CONVERTIBLE NOTE IN AN EARLY STAGE INVESTMENT?

1st June 2019

THE CONVERTIBLE NOTE IS FREQUENTLY THE MOST POPULAR INVESTMENT DOCUMENT FOR PRE SERIES A INVESTMENTS. In Hong Kong it is used by lots of business angels. Why? •...

TECH TEAMS LEAVING TO SET UP BUSINESS - HIDDEN TRAPS AND 7 TOP TIPS

14th January 2019

Tech teams leaving to set up in business – hidden traps and 7 top tips In October 2018 Bombardier sued Mitsubishi in the Seattle District Court for breach of co...

WHAT ARE THE DIRECTORS DUTIES IN A UTILITY TOKEN ICO?

20th December 2018

Notice: this note does not apply to security tokens. There is a higher standard of duties and much more regulatory oversight on security token issues. Also note that we a...

ICOS - WHAT’S A SECURITY TOKEN? WHAT’S THE RISK IF IT IS?

30th September 2018

In Hong Kong if the Securities and Futures Commission (SFC) decide a token is a security token they will probably write to digital exchanges asking them to stop trading t...

JUST FOUR KEY POINTS TO UNDERSTAND ICOs AND IF THEY ARE REGULATED

18th June 2018

The booming world of blockchain token offerings is full of internet postings and myths so this blog is an attempt to explain ICOs in a way which all business people can u...

WHAT IS BLOCKCHAIN?

31st March 2018

• A record of transactions – how does it work? A block is a record of transactions (that could be applied in all sorts of sectors, such as medical data in a...

LETTER OF INTENT PART 3 – TIPS ON RAISING YOUR FIRST $1-5 MILLION

31st January 2018

I have recently learned two (positive) lessons from start ups which had problems with their investors. No surprises Investors hate surprises and they appreciate trans...

FOUR BASIC MISTAKES TO AVOID AS A STARTUP DIRECTOR

31st August 2017

Most startup directors are also founders or shareholders, but they often make basic mistakes, some of which involve liabilities. They haven’t done MBAs or law degr...

LETTERS OF INTENT PART 2 – CASE STUDY: A TRAP TO AVOID

25th July 2017

This is based on a real case which occurred recently in Hong Kong. It applies in other countries too. Does a letter of intent have legal force? See our previous blog...

IS IT WORTH DOING A LETTER OF INTENT?

27th March 2017

Generally, yes – but there are some traps to avoid; and some useful tools you can use. Does it have legal force? You can draft it to be legally binding or not...

TOP 5 TIPS ON NDAs – ARE THEY A WASTE OF TIME?

24th December 2016

Generally, no – but you should recognise an NDA’s limitations if you are disclosing confidential information to an investor or buyer or a licensee of your t...

THE 3 TOP REASONS TO TAKE LOAN NOTES - WE SUGGEST CONVERTIBLE NOTES

16th November 2016

Here are the 3 top reasons: • Interest. Interest on loan notes is normally fixed and payable as a debt. Dividends on preference shares are commonly fixed, but b...

CAN WE PAY SHAREHOLDERS DIFFERENT DIVIDENDS?

10th October 2016

This question comes up a lot. Management or the controlling shareholders often ask if it’s possible. Generally, it’s a basic principle of company law that d...

WHAT ARE THE USUAL STEPS IN A COMPANY ACQUISITION DEAL?

13th March 2016

PRELIMINARY DISCUSSIONS NON-DISCLOSURE AGREEMENT (NDA) including • Buyer agrees to keep all information disclosed confidential • Seller agrees not to ent...

AVIATION SECTOR INVESTMENTS – WHAT SPECIAL DUE DILIGENCE IS NECESSARY?

20th January 2016

Private equity in the aviation sector is very active. If you know your industry, paying for a full form professional written report may not be essential. This sounds radi...

WHAT ARE THE DIFFERENCES BETWEEN A BUSINESS ANGEL AND A PRIVATE EQUITY INVESTOR?

10th November 2015

There can be huge differences between angel investors and the many types of private equity investor. Rather than get technical re senior debt, mezzanine, preference share...

WE ARE DOING AN ASIAN CORPORATE JOINT VENTURE: WHAT LAW CAN WE USE?

1st October 2015

Where is the business going to operate? In Asia, it is quite likely the operating company is going to be in China or a developing country. Now, you could write your JV Ag...

IS IT WORTH PAYING FOR A DUE DILIGENCE REPORT?

15th August 2015

A due diligence report is important but, if you know your industry, paying for a full professional written report may not be essential. This sounds radical. Of course you...

TOP TIPS IN MERGERS & ACQUISITIONS – Dos and don’ts

30th June 2015

DOS – Purchasers: Get a Memorandum or Understanding to commit the SellerGet exclusivity (so that the Seller can’t talk to other buyers)Take tax advice earl...

IS A JOINT VENTURE AGREEMENT ENOUGH?

10th April 2015

A joint venture agreement is not enough. You are asking for trouble if your joint venture’s Articles of Association fail to correspond to the shareholder’s...

MY INVESTOR WANTS PREFERENCE SHARES OR LOAN NOTES – IS THERE A BIG DIFFERENCE?

15th March 2015

Yes there is quite a big difference and it could make a difference to how much of your company you keep. There is a lot of choice about how you structure preference share...

HONG KONG'S NEW COMPANIES ORDINANCE 2014 – DIRECTORS

3rd March 2014

The new law came into force on 3 March 2014. It is a major rewrite of Hong Kong's company law which has taken several years and is aimed at maintaining Hong Kong’s...