Legal Due Diligence for a Business Acquisition, Merger or Share Purchase

The main purpose of a business acquisition legal due diligence is to give you the necessary information to acquire, merge, or purchase a Target Company, or to provide such information to potential acquirers in respect of your company. The information contained in the due diligence report will:

1. Allow one to make an informed decision in regard to the proposed business acquisition, merger or purchase;
2. Identify, understand and quantify potential “deal breakers” and other risks associated with the a business acquisition, merger or purchase;
3. Verify the accuracy and completeness of the representations and warranties made by the potential sellers to the Target Company;
4. Place one in a better position to negotiate or adjust the business acquisition, merger, or purchase price as may be appropriate, and to tailor the appropriate warranties, representations and indemnities in this regard;
5. Identify the legal, regulatory and contractual impediments to the conclusion of the proposed transaction, including any governmental or other approvals required.

After you checkout, we will request that you send us (to the extent that each apply) the following for our review (We will guide you through the process):

1. Corporate Records: Company MOI, Shareholders Agreement, share register, register of directors;
2. Finance Documents: Any documents relating to any securities offerings, loans, lines of credit, agreements incorporating borrowings, any documents evidencing guarantees, inter-company loans, any other agreements with creditors;
3. Litigation: Schedule of all material litigation, disputes or administrative proceedings;
4. Intellectual Property: Schedules of all intellectual property owned by the Target Company including trademarks, services marks, trade dress, license agreements, trade secrets. Also, agreements with other contractors, entities or other persons which may be tasked with doing services or creating works on your behalf;
5. Property and Assets: Schedule of all property owned, leased or used by the Target Company including plant and equipment, lease agreements, hire purchase agreements;
6. Material Agreements: All other agreements that may be material to a company relevant to its industry or not mentioned above, such as material acquisition documents or research development agreements, supplier contracts, customer agreements, consulting or advertising agreements.

The package will include the review and preparation of a red flags report based on the top 10 material contracts / policies as advised by the client and identified by Legal Legends.  Should you wish for the review of further contracts, additional contract reviews will be charged out at a rate of R800 per contract.

For our standard due diligence report, we take a maximum of two weeks to compile the report. Please note that should we be called upon to consider more than the standard 10 contracts, our turnaround time may differ. We will always keep you posted on turnaround time however.