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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

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International flipping considerations - Kiss my SaaS

  • 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