Below is a recap of recent posts to the Stradley Ronon Business Vantage Point blog. Articles on timely topics impacting ownership, operation and financing of businesses across industries written by our trusted advisers are posted regularly on the site. If you haven’t yet subscribed, please click here to ensure you don’t miss any upcoming articles.
IN THE AUGUST ISSUE:
How Generative AI Is Changing the M&A Process
The release and popularity of programs like Chat GPT, Bard and Dall-E have brought to light the power of generative artificial intelligence (generative AI), which is a form of artificial intelligence capable of creating information in response to prompts. While standard AI systems can only synthesize existing information, generative AI can produce new text, images, videos and code. This trait enables generative AI to “think” and “act” similarly to humans. As such, the practical uses for generative AI are widespread and are beginning to redefine how tasks are completed. In the field of law, generative AI has the ability to alter the workflow of attorneys and law firms and hence impact the client experience. With respect to mergers and acquisitions specifically, in time, generative AI likely will impact almost all steps of the deal-making process. Read More...
Digital Assets and Controllable Electronic Records Under UCC Article 12 – Overview, Adoption Status, Potential Issues and Questions for Transactions Going Forward
In July 2013, the market cap of Bitcoin, the largest and most widely recognized cryptocurrency, stabilized at just over $1 billion – growth in excess of 1,000% from the prior year. In July 2023, Bitcoin’s market cap oscillates around the $600 billion mark, dwarfing its market cap from a decade prior as it recovers from a precipitous fall from a peak of more than $1.2 trillion in November 2021. Digital assets such as cryptocurrencies and non-fungible tokens have, thanks to their recent and meteoric rise in value and notwithstanding their generally high volatility, become a significant source of collateral in financing transactions and a prevalent asset in purchase transactions. Read More...
Critical Importance of a Holistic Approach in the M&A of a Closely Held and Family Owned Business
Successful business succession planning for a closely held and family owned business requires a multidisciplinary approach, bringing together professionals in several areas, including financial/wealth advisory, accounting, trust and estate law and corporate law. National surveys over the past 15-plus years have shown that the two most popular succession events are a sale of the business to an unrelated third party (representing over 50% of such events), followed by a transition of the business to the next generation of family owners (representing around 20% to 25% of such events). Read More...
Debt Relief Assistance: A New Model for Employee Benefits
Debt relief assistance is an often-overlooked, relatively low-cost employee benefit available to any employer. A recent study found that employees were increasingly distracted from work due to debt stress, with 62% of respondents reporting that they would be more likely to stay with an employer that offered debt relief assistance. Read More...
Equity-Based Compensation: Delegation of Grantmaking Authority
As we explained in a prior blog post – The Basics of Granting Equity-Based Compensation Awards – state laws governing corporate governance provisions typically apply to certain aspects of executive compensation arrangements, including, for example, who has the authority to grant equity awards. In 2022, Delaware amended Sections 152 and 157 of the Delaware General Corporation Law (DGCL) to expand the board of directors’ ability to delegate grantmaking authority with respect to stock rights and options. More recently, on May 16, 2023, and June 30, 2023, the Delaware State Senate and the Delaware State House, respectively, adopted further amendments, which are awaiting the Governor’s signature. If signed into law, the 2023 amendments would become effective on Aug. 1, 2023. Read More...
Earnout Provisions in M&A Deals During Down Markets
Businesses operating within the U.S. market have been facing a growing list of challenges. Rapidly rising interest rates, reduced access to equity investment and debt facilities, and continuing supply chain issues, as well as the lingering effects of the COVID-19 pandemic, have forced many businesses to rethink their operations and reevaluate their financial models. This market volatility presents a unique set of challenges for companies that either wish to sell all or part of their business or otherwise wish to expand their operations through the acquisition of another company. Read More...
Information contained in this publication should not be construed as legal advice or opinion or as a substitute for the advice of counsel. The articles by these authors may have first appeared in other publications. The content provided is for educational and informational purposes for the use of clients and others who may be interested in the subject matter. We recommend that readers seek specific advice from counsel about particular matters of interest.
Copyright © 2023 Stradley Ronon Stevens & Young, LLP. All rights reserved.