Consideration for flip NZ companies and stakeholder management.

1. Navigation flips and managing stakeholders...
Investor expectations Shareholder management
• Are they comfortable for IP to remain
in NZ? Avoids asset-swap.
• Understand how they intend to deal
with existing shareholders
• Agree terms conditional on flip
• Know what terms they are using and
expecting – US VCs :
 http://nvca.org/resources/model-legal-documents/
 Get an experienced US legal firm experience
• Shareholder support will be required
one way or another
• Be able to explain it to them – in
terms of impact on them
• Focus on tax changes, preference
rights, board representation,
reporting and pre-emptive rights
• Understand their treatment for US
securities law (on share swap)
Flip reasons/options Flipping considerations
• Reasons include investment,
customer requirements, and merger
opportunities
• Share-swap: existing shareholders
swap their shares for new shares in US
entity - requires full participation
• Re-domicile: company effectively
switches onto a new register overseas
- special resolution but may make
current documents redundant
• Asset-swap: special resolution
(minority buy-out)
• Tax: understand impact on SHs,
group and executive team
• CoC: does it trigger any change of
control provisions?
• Grants: does it trigger any claw-
backs?
• Executive team: who are they now
employed by?
• Due diligence: expect vigorous DD,
like a mini-M&A – hotspots IP,
Executive terms, and technology
• Vesting: expect (at least in
US/AU/Israel) to have this recharge
• Options: work out how to migrate to
a new scheme
Kiss My SaaS April 17
Bruno Bordignon
Director
bruno,bordignon@avid.legal