{"id":126136,"date":"2026-01-09T10:14:28","date_gmt":"2026-01-09T10:14:28","guid":{"rendered":"https:\/\/my.legal500.com\/guides\/?post_type=comparative_guide&#038;p=126136"},"modified":"2026-01-09T10:15:50","modified_gmt":"2026-01-09T10:15:50","slug":"united-states-acquisition-finance","status":"publish","type":"comparative_guide","link":"https:\/\/my.legal500.com\/guides\/chapter\/united-states-acquisition-finance\/","title":{"rendered":"United States: Acquisition Finance"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-126136","comparative_guide","type-comparative_guide","status-publish","hentry","guides-acquisition-finance","jurisdictions-united-states"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Latham &amp; Watkins LLP<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2021\/04\/LLP-logo.jpg\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">Latham &amp; Watkins LLP<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2021\/04\/LLP-logo.jpg\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Acquisition Finance laws and regulations applicable in United States<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the trends impacting acquisition finance in your jurisdiction and what have been the effects of those trends? Please consider the impact of recent economic cycles, Covid-19, developments relating to sanctions, and any environmental, social, and governance (\u201cESG\u201d) issues.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>2025 witnessed a resurgence in acquisition finance activity (and leveraged finance activity generally), which has been a welcome change following a period of muted activity in 2023 and 2024 caused by the economic impact of supply chain disruptions as well as the impact of macro-economic developments related to the war in Ukraine and related sanctions leading to accelerating inflation in the US and globally. In 2025, with fears of inflation easing globally and the corresponding rate reduction cycle taking shape, markets continued to normalize leading to further financing activity to support M&amp;A growth over the course of the last twelve months and a bullish outlook for 2026. Additionally, tariffs have had a muted effect on deal making though we have seen a refocus on tariff resistant industries in terms of acquisition activity. The bigger trend impacting acquisition finance in the US has been AI as a focus in acquisition financings; businesses that are clearly resistant to AI takeover risk have become markedly more attractive to investors (whereas if a business has a clear AI takeover risk it may struggle in the market). The AI revolution has also undoubtedly been creating new opportunities in the market as the capital demands for financing the acquisition of Graphics Processing Units (GPUs) as well as data centers to house such GPUs and related energy infrastructure, have grown rapidly in tandem with the AI investment cycle.<\/p>\n<p>Separately, dislocations in the syndicated loan market resulting from depressed secondary trading prices created an opportunity for private credit to play an increasingly prominent role in US acquisition financings, including in larger \u201cmega-unitranche\u201d structures. Backed by private credit and direct lending funds, volume for \u201ccore\u201d middle market acquisition financing has remained relatively robust in 2025. Traditional sponsor and corporate borrowers are also looking to private credit to finance a wide range of asset classes, from real estate and infrastructure to technology and healthcare. For example, in the real estate sector, private credit is playing a crucial role in financing development projects and acquisitions, particularly in light of tightening bank lending standards. In infrastructure, private credit is being used to fund large-scale projects, such as renewable energy developments, that require significant capital investment. There is also a rise in private credit financing in the technology space, with its rapid pace of innovation and growth, where borrowers are tapping private credit keen to support companies with scalable business models and strong growth potential.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please advise of any recent legal, tax, regulatory or other developments (including any reforms) that will impact foreign or domestic lenders (both bank and non-bank lenders) in the acquisition finance market in your jurisdiction.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>On December 5, 2025, the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) issued a joint interagency statement rescinding the March 2013 Interagency Guidance on Leveraged Lending as well as the accompanying FAQs for implementing such Guidance. Instead, the agencies expect banks to manage leveraged lending exposures consistent with general principles for safe and sound lending. This has the potential to allow banks to make their own determinations of risk appetite, which will give banks greater flexibility to underwrite a broader range of loans and to each develop a bank specific definition of what is a \u2018leveraged loan\u2019. In turn, this may let some banks with more competitive mandates be better able to compete at deeper leverage levels that would have been restricted under the prior supervisory constraints.<\/p>\n<p>Minority lender plaintiffs have also notched a series of recent victories in attacking non-pro rata uptiering liability management transactions, most recently in the US Court of Appeals for the Fifth Circuit regarding the permissibility of the Serta Simmons Bedding debt exchange, where a three-judge panel unanimously held that the uptier transaction undertaken by Serta Simmons Bedding did not qualify as an &#8220;open market purchase&#8221; and hence violated the provisions under the terms of Serta&#8217;s 2016 credit agreement protecting the pro rata treatment of lenders. Similarly, in 2022, the New York State Supreme Court denied the defendants\u2019 motion to dismiss the Boardriders decision which, among other things, supported the possibility that liability management transactions negotiated with majority lenders that are not offered pro rata to all lenders may in certain circumstances violate the implied duty of good faith and fair dealing under New York law, separate and apart from whether the transaction complied with the relevant contractual provisions. As such, we expect that these recent victories scored by minority lender plaintiffs in such non-pro rata uptiering liability management transactions could make both bank and non-bank lenders less likely to take more aggressive liability management action and similarly, borrowers would also look to draft more favorably on new deals to pre-empt such challenges.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please highlight any specific high level issues or concerns in your jurisdiction that should be considered in respect of structuring or documenting a typical acquisition financing.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Deal certainty is a central concern in US acquisition financings \u2013 certainty as to conditionality and terms. For conditionality, US acquisition agreements often lack a financing out, and a buyer is required to consummate an acquisition regardless of whether their financing sources fund. Consequently, buyers look to align financing and acquisition conditionality to ensure no daylight exists between the two. Sellers are motivated to seek the same alignment to ensure buyers will have the capital required to consummate the acquisition. Market practice has evolved to balance the interests of buyers as borrowers and their financing sources. Related provisions are often referred to as \u201cSunGard\u201d provisions, so-named after the company in the first deal to contain those provisions.<\/p>\n<p>With respect to terms, buyers seek to negotiate them to the fullest extent possible prior to signing an acquisition agreement. Buyers often request their financing sources underwrite a precedent credit agreement to address terms beyond the scope of a typical term sheet alongside a very detailed term sheet. In private credit financings, financing have very limited ability to alter the agreed terms, which results in exceptional focus on underwritten terms. In syndicated financings, financing sources typically have additional flexibility to modify terms to ensure a successful syndication through \u201cmarket flex\u201d rights. Buyers seek to minimize \u201cmarket flex\u201d provisions and sellers seek to avoid flex provisions that go to financing quantum or conditionality.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">In your jurisdiction, due to current market conditions, are there any emerging documentary features or practices or existing documentary provisions\/features which borrowers or lenders are adjusting or innovating their interpretation of, or documentary approach to?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Liability management exercises (LMEs) have become increasingly prevalent in the US as borrowers and private equity sponsors have turned to LMEs in order to obtain fresh liquidity or to restructure a company\u2019s debt obligations in the face of tightening conditions. A series of widely publicized liability management transactions have put LMEs in sharp focus for lenders who are now strongly motivated to ensure that the deal documentation contains expanded lender protections aiming to tighten any flexibility or loopholes pursuant to which borrowers may undertake an LME.<\/p>\n<p>On a different note, 2025 has seen an upswing in M&amp;A and capital markets activity which has prompted a rise in private equity sponsors seeking to build in portability (in the form of permitted change of control provisions) into the financing documentation. These portability provisions (which will be heavily negotiated between the private equity sponsor and lenders and subject to a number of guardrails to ensure that the lenders are protected in connection with the port over to a new private equity sponsor) would enable a credit facility to remain in place without triggering an event of default (or a refinancing) following a change of control event.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Has there been a prevalence of \u201cequity bidding\u201d in acquisition financing (i.e., signing the acquisition agreement prior to securing financing) with the expectation of securing financing shortly thereafter? If in the US, would Xerox language be included in the acquisition agreement?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>With the uptick in M&amp;A activity in 2025, there have been a growing trend of \u201cequity bidding\u201d as private equity buyers seek to give the seller stronger deal certainty and expedite finalizing the terms of the acquisition by providing a full equity backstop. In such cases, the buyer will typically still seek to secure financing concurrently in the background even though the acquisition documentation might not contain any financing outs or any reference to the financing generally. However, to the extent lenders provide committed financing to the buyer for the acquisition, the lenders will generally still require \u201cXerox\u201d protections to be included in the acquisition agreement to ensure that the lenders are protected from any liability or litigation risk in connection with the acquisition if the lenders do not ultimately fund under the committed financing.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any notable trends in the use of certain financing structures (e.g., private credit vs syndicated vs high yield vs holdco vs mezzanine vs preferred, etc.) in your jurisdiction for acquisition financings?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The most notable trend in financing structures over the last couple of years has been the remarkable growth of private credit in acquisition financings in the US, driven largely by the ability of private credit lenders to continue to innovate to meet the growing needs of private equity sponsors and borrowers. 2025 has seen private credit lenders successfully assemble large clubs of private debt lenders to provide jumbo unitranche debt facilities on very short timelines, promising quick execution and a seamless financing process through completion of the deal. At the same time, hybrid capital solutions (which blend debt and equity elements) provided by private credit lenders has been a key area driving the exponential growth of private credit in acquisition financings as sponsors and borrowers increasingly take advantage of this versatile tool for optimizing capital structures. Hybrid capital instruments allow borrowers and private equity sponsors to manage costs effectively and meet regulatory requirements without over-leveraging (given that such products would often have a payment in kind (PIK) feature allowing interest payments to be deferred, thereby alleviating immediate cash flow pressures), which then enables the ability of borrowers and sponsors to monetize assets effectively, providing more dry powder for acquisitions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Has the use of technology (e.g., e-signatures, digital platforms for syndication, document automation, AI, etc.) impacted the documentation or execution of acquisition financings?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The advance of technology in the form of e-signatures (which are widely used and commonly accepted practice for financings in the US in light of legislation such as the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act and other similar state laws based on the Uniform Electronic Transactions Act) and digital platforms for syndication has accelerated timelines for deal cycles and vastly improved the operational efficiency of the syndication process. On the other hand, lenders and borrowers (and their counsels) are also adapting to the growing use of AI in the documentation process. At present, AI is more of a helpful tool in automating certain aspects of a deal, for example in benchmarking deal terms or in streamlining the due diligence process, but remains limited in the in the structuring, strategy or negotiating aspects of acquisition financings which is predicated upon the nuances of the transaction based on various considerations as well as the bargaining position of the parties.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the legal and regulatory requirements for banks and non-banks to be authorised to provide financing to, and to benefit from security provided by, entities established in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>While there is no US federal regulatory framework applicable to non-bank lenders that are engaged in commercial lending in the US, a few US states require non-bank lenders to obtain a license prior to engaging in commercial lending activities (i.e., lending activities engaged in between corporate lenders and corporate\/institutional borrowers for business or commercial purposes) under certain circumstances. The commercial lending licensing requirements of some of these states are generally triggered only when a commercial loan is secured by real property located in one of such states. However, in California, commercial lending license requirements may be implicated regardless of whether a commercial loan is secured by real property located in the state. As such, California is the state that is most often implicated in the commercial lending context due to the broad scope of California\u2019s commercial lender licensing requirement. The US states that may impose commercial lending licensing requirements (unless an exemption from such licensing requirements applies), generally include, but are not limited to: California, Florida, Nevada, North Dakota, South Dakota and Vermont.<\/p>\n<p>While New York does have a commercial lending licensing requirement, such requirement is only applicable to business and commercial loans in a principal amount of US$ 50,000 or less that also meet other specified conditions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any laws or regulations which govern the advance of loan proceeds into, or the repayment of principal, interest or fees from, your jurisdiction in a foreign currency?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>U.S. Federal law does not impose any restrictions or controls on either the advancement of loan proceeds in foreign currencies or the payment of interest or fees (or repayment of principal) in a foreign currency. Rather, such restrictions will often depend on the ability of individual lending institutions to provide loans in a particular foreign currency or otherwise to receive payments in such foreign currency. Lenders should take into account federal sanctions and anti-money laundering laws which require financial institutions to implement due diligence procedures with respect to their customers to prevent the transfer of cash to certain prohibited countries and persons.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any laws or regulations which limit the ability of foreign entities to acquire assets in your jurisdiction or for lenders to finance the acquisition of assets in your jurisdiction? Please include any restrictions on the use of proceeds.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Special rules may apply depending on the industry and asset, but typical areas of regulatory approval for acquisitions (or financings thereof) include US antitrust regulations, foreign direct investment laws applicable to the industry and asset (for example CFIUS approvals), along with customary sanctions, anti-money laundering and KYC rules that apply to lenders generally.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What does the security package typically consist of in acquisition financing transactions in your jurisdiction and are there any additional security assets available to lenders?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Typically non-investment grade acquisition financing transactions are supported by \u201call asset\u201d liens (subject to agreed exceptions) over the assets of the target and its subsidiaries and an equity pledge by a holding company in the top tier borrower or operating company.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does the law of your jurisdiction permit (i) floating charges or any other universal security interest and (ii) security over future assets or for future obligations?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>For personal property, yes to both.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Do security documents have to (by law) include a cap on liabilities? If so, how is this usually calculated\/agreed?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>No and would be uncommon for personal property security documents. For real property, caps are sometimes agreed to reduce any mortgage recording tax or title fees.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the formalities for taking and perfecting security in your jurisdiction and the associated costs and timing? If these requirements are different for different asset classes, please outline the main points to note for each of these briefly.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>For personal property, a security or pledge agreement describing the collateral either specifically or by asset classes would create the security interest. Perfection for most types of personal property can be accomplished by filing a UCC financing statement. Perfection by possession or \u201ccontrol\u201d is either permissible or, for some assets, required for perfection. Certain asset types are subject to special perfection rules such as noting the lien of the secured party on the certificate of title for motor vehicles or making certain federal filings, e.g. for registered copyrights or aircraft. For real property, execution and delivery of a mortgage or deed of trust and their recordation in the real estate recording office is generally required. For associated costs, refer to question 16 below. The timing differences can be substantial. For personal property, the filing of a UCC financing statement can be quick (even same day, depending on the jurisdiction) upon completion of the required security and pledge documents and payment of required fees, whereas for real property, the documentation requirements for recording a mortgage can be more involved with potentially longer processing times depending on the local jurisdiction where the mortgage will be recorded.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any limitations, restrictions or prohibitions on downstream, upstream and cross-stream guarantees in your jurisdiction? Please also provide a brief description of any potential mitigants or solutions to these limitations, restrictions or prohibitions.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>US guarantees fall into three categories, namely (i) &#8220;downstream&#8221; guarantees whereby a parent company guarantees the debt of its subsidiary, (ii) &#8220;upstream&#8221; guarantees whereby a subsidiary guarantees the debt of its parent entity, and (iii) &#8220;cross-stream&#8221; guarantees whereby a subsidiary guarantees the debt of a sister company. Hence, US companies are generally permitted to guarantee and secure the obligations of another group member, subject to certain considerations and limitations. To be enforceable, the guarantee needs to comply with certain general principles like receipt and sufficiency of consideration and, in some states, be in writing and duly executed by the guarantor to comply with the Statute of Frauds. However, showing direct corporate benefit to the guarantor is not necessary to determine sufficiency of consideration where such intercorporate guarantee benefits the group as a whole. Another mitigant can include showing the guarantor was not, as a result of the guarantee, left insolvent or with unreasonably small capital, or incurred debts beyond their ability to pay. In insolvency proceedings, corporate benefit consideration and the financial condition of the guarantor is relevant to determine whether such guarantee can be challenged as a fraudulent transfer under the US Bankruptcy Code.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any other notable costs, consents or restrictions associated with providing security for, or guaranteeing, acquisition financing in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>For personal property, generally only nominal filing costs, with more substantial filing taxes in a couple of states. Additionally, for assets with specific perfection requirements with respect to each asset, such as certificates of title for motor vehicles, costs can rise if the debtor has a substantial number of such assets. Real estate recording fees and title insurance can be substantial but costs vary widely among US jurisdictions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is it possible for a company to give financial assistance (by entering into a guarantee, providing security in respect of acquisition debt or providing any other form of financial assistance) to another company within the group for the purpose of acquiring shares in (i) itself, (ii) a sister company and\/or (iii) a parent company? If there are restrictions on  granting financial assistance, please specify the extent to which such restrictions will affect the amount that can be guaranteed and\/or secured.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Generally, the US does not have any restrictions on &#8220;financial assistance&#8221; that would prohibit providing guarantees or security to support borrowings to finance the acquisition of a target company (or its direct or indirect parent or any related company). However, depending on the type of entity being acquired or that is required to provide the guarantee or security, there may be regulatory issues to consider when the guarantee or security provider is a specialized or regulated entity. Fraudulent transfer issues are also relevant when guarantees and\/or security are provided to support borrowings to acquire another company and accordingly, the applicable company and the lenders will need to be comfortable with the solvency of the guarantors and security providers and the loan documentation would require solvency representations to this effect.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If there are any financial assistance issues in your jurisdiction, is there a procedure available that will have the effect of making the proposed financial assistance possible (and if so, please briefly describe the procedure and how long it will take)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>N\/A.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">If there are financial assistance issues in your jurisdiction, is it possible to give guarantees and\/or security for debt that is not pure acquisition debt (e.g. refinancing debt) and if so it is necessary or strongly desirable that the different types of debt be clearly identifiable and\/or segregated (e.g. by tranching)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>N\/A.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction recognise the concept of a security trustee or security agent for the purposes of holding security, enforcing the rights of the lenders and applying the proceeds of enforcement? If not, is there any other way in which the lenders can claim and share security without each lender individually enforcing its rights (e.g. the concept of parallel debt)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction have significant restrictions on the role of a security agent (e.g. if the security agent in respect of local security or assets is a foreign entity)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>No significant restrictions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please provide the main differences and considerations between bank loan financing and high yield bond\/note financing for acquisition purposes in your jurisdiction, and how do they affect the structuring and documentation of the transaction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Typically, leveraged acquisitions in the US are financed through a mixture of high-yield bonds and term B loans; any working capital requirements would also be provided by lenders though revolving facilities in the form of either cash flow or asset backed revolvers. Term B loans are floating rate loans, usually with a maturity of seven years and a 1% per annum amortization rate and would be held by institutional investors such as CLOs, pension plans and mutual funds (in the case of broadly syndicated term loans) or a club of direct lenders (in the case of private credit term loans). Term B loans in the form of first lien debt will be senior in the company\u2019s capital structure and the term lenders will have a first lien security interest over the assets of the borrower and its subsidiaries. High yield bonds are fixed-rate debt securities, usually with a maturity of five to seven years (but without any amortization) and would be held by institutional investors such as pension plans, investment funds and hedge funds; bonds are also often junior in the capital structure or unsecured and so, would be subordinated to the first lien term loans in payment and lien priority. In terms of the documentation, the bond documentation will often contain more permissive covenants (and financial ratios would only be tested on an incurrence basis) whereas the covenant package in term loans will be tighter (requiring lender consent for major transactions) and with either a springing financial covenant (customarily included in broadly syndicated term loans) or a maintenance financial covenant (more typically seen in private credit transactions). Finally, depending on market conditions, term loans can generally be provided on a shorter timeline whereas the timeline for high yield transactions will be driven by the availability of a company\u2019s recent financial information which will be a consideration for borrowers and issuers in timing the closing of an acquisition.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Describe the loan transfer mechanisms that exist in your jurisdiction and how the benefit of the associated security package can be transferred.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The administrative agent maintains a register and transfers are recorded by the administrative agent. Credit Agreements frequently limit who can become a lender either by entity type and\/or net worth and may include a list of disqualified transferees. Consent of the administrative agent and in some cases the Borrower may also be required.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the rules governing the priority of competing security interests in your jurisdiction? What methods of subordination are used in your jurisdiction and can the priority be contractually varied? Will contractual subordination provisions survive the insolvency of a borrower incorporated in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>For most personal property, priority follows the order of perfection; however, for categories of personal property with multiple methods of perfection, certain methods such as possession or control may be afforded priority even over a prior secured interest perfect solely by filing a UCC financing statement. Priority rules for real property vary among jurisdictions. A secured party entitled to priority may subordinate its security interest to the security interest of another secured party. A creditor may also subordinate its right to payment. Generally, these contractual agreements will be respected in bankruptcy.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a concept of \u201cequitable subordination\u201d in your jurisdiction whereby loans provided by a shareholder (as a creditor) to a company incorporated in your jurisdiction are subordinated by law upon insolvency of that company in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, shareholder loans are not automatically subordinated but may be at greater risk of being equitably subordinated.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does your jurisdiction generally (i) recognise and enforce clauses regarding choice of a foreign law as the governing law of the contract, the submission to a foreign jurisdiction and a waiver of immunity and (ii) enforce foreign judgments?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, subject to certain exceptions and limitations.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the requirements, procedures, methods and restrictions relating to the enforcement of collateral by secured lenders in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>For personal property, outside of bankruptcy, a creditor would avail itself of a number of \u201cself-help\u201d options to foreclose without need for judicial intervention, including the ability to dispose of the relevant collateral in a public or private sale meeting certain commercial reasonableness and notice criteria.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the insolvency or other rescue\/reorganisation procedures in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The Bankruptcy Code is the primary corporate insolvency law in the US, which provides alternative regimes for reorganization under chapter 11 or liquidation under chapter 7. Each state also has statutes that provide rules for receivership or assignment for the benefit of creditors, which can vary substantially by state.<\/p>\n<p>Chapter 11 is a court-supervised process to restructure a company\u2019s debts. The process is designed to allow the company to operate in the ordinary course, emerge with a stronger balance sheet, and maintain board and management in control of operations, subject to court oversight and the rights of parties in interest to be heard. The company is characterized as a \u201cdebtor-in-possession.\u201d The goal of a chapter 11 is for the company to develop a plan of reorganization with major stakeholders to restructure its debts. The company may also use chapter 11 for a going concern sale or other controlled liquidation of assets.<\/p>\n<p>Chapter 7 is a court-supervised process used to liquidate a company in an orderly manner. Chapter 7 cases do not involve the filing of a plan of organization. Instead, a bankruptcy trustee marshals and sells the debtor&#8217;s non-exempt assets and uses the proceeds of such assets to pay holders of claims in accordance with the Bankruptcy Code. Typically, secured creditors will be paid from the value of their collateral, subject to the potential to surcharge for the costs of preserving and realizing the collateral.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Does entry into any insolvency or other process in your jurisdiction prevent or delay secured lenders from accelerating their loans or enforcing their security in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, the automatic stay under the bankruptcy code would apply in appropriate circumstances.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">In what order are creditors paid on an insolvency in your jurisdiction and are there any creditors that will take priority to secured creditors?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Certain administrative expense claims will be paid first from the value of unencumbered assets and a statutory condition for confirmation (or approval) of a chapter 11 plan, which practically requires payment of administrative expense claims in cash even if secured creditors are impaired. Secured parties are entitled to be paid in order or priority from their collateral, subject to the possibility of \u201ccram down\u201d pursuant to a chapter 11 plan and surcharge for the costs of preserving and realizing the collateral, followed by unsecured or under-secured claims.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any hardening periods or transactions voidable upon insolvency in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Transfers on account of an antecedent debt made within the 90 days prior to the bankruptcy filing when the debtor was insolvent are avoidable as a preference if they permit the creditor to receive more than they would in a hypothetical chapter 7 liquidation. Perfection of a new lien is considered to be a transfer for the purposes of preference claims. The 90 day period is extended to one year for insiders. There are a variety of statutory defenses and safe harbors to preference claims.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any other notable risks or concerns for secured lenders in enforcing their rights under a loan or collateral agreement (whether in an insolvency or restructuring context or otherwise)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>For personal property, secured creditors generally must proceed in a commercially reasonable manner or risk losing their deficiency and potentially being liable for damages.<\/p>\n<p>State law, particularly in California, may impose a \u201cone action rule\u201d that requires secured lenders to foreclose on their security interests before taking other recourse on their debt or otherwise governs the manner in which secured lenders may exercise remedies.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Please detail any taxes, duties, charges or related considerations which are relevant for lenders making loans to (or taking security and guarantees from) entities in your jurisdiction in the context of acquisition finance, including if any withholding tax is applicable on payments (interest and fees) to lenders and at what rate.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The US federal government generally imposes a 30% withholding tax on interest paid to non-US lenders on a debt obligation of a US person (and certain non-US persons engaged in trade or business in the US). For this purpose, payments with respect to any original issue discount, if not considered less than de minimis, are also treated as interest income and subject to such withholding tax.<\/p>\n<p>If a lender is qualified for the benefits of an applicable double taxation treaty between the US and its country of residence, the withholding tax may be reduced or eliminated.<\/p>\n<p>Alternatively, a non-US lender may qualify for exemption under the \u201cportfolio interest exemption\u201d (PIE). To qualify, the lender must neither (i) be a controlled foreign corporation related to the borrower or a bank receiving interest on an extension of credit entered into in the ordinary course of its trade or business nor (ii) own (directly, indirectly or by attribution) equity representing 10% or more of the borrower\u2019s total combined voting power of all voting stock (or, if the borrower is a partnership, 10% or more of its capital or profits interest).<\/p>\n<p>The PIE is only available for debt in \u201cregistered form\u201d for US federal income tax purposes, and does not apply to certain contingent interest, such as interest determined by reference to any receipts, sales, cash flow, income or profits of, or the fluctuation in value of property owned by, or dividends, distributions or similar payments by, the borrower or a related person.<\/p>\n<p>To claim an exemption or reduction under an applicable double taxation treaty or the PIE, the beneficial owner of interest must generally submit a completed IRS Form W-8BEN-E (or, if an individual, IRS Form W-8BEN).<\/p>\n<p>If interest paid to a non-US lender is effectively connected with such lender\u2019s trade or business in the US, such interest will not be subject to US federal withholding if such lender submits a completed IRS Form W-8ECI, but will generally be subject to net income tax in the US and, for foreign corporations, branch profits taxes.<\/p>\n<p>Other exemptions may be available for foreign governments or governmental entities assuming they provide the applicable completed IRS Form W-8EXP.<\/p>\n<p>Withholding taxes may also apply upon: (i) payment to a US person that does not demonstrate an exemption by providing an applicable completed IRS Form W-9, (ii) payment of US source interest and certain other amounts to entities treated as \u201cForeign Financial Institutions\u201d not eligible for an exemption from FATCA withholding tax, and (iii) payment of various fees (such as letter of credit fees), modifications to debt obligations, and various adjustments on debt obligations convertible into stock.<\/p>\n<p>Payments under a guarantee are generally similarly treated, with the source of payments for US federal income tax purposes generally determined based on residence of the borrower. If the lender is receiving security proceeds, such transaction may generally be treated as a payment on the loan. Under certain circumstances, the lender may be treated as the owner of the foreclosed property, resulting in adverse tax consequences (especially cases of US real property held by a foreign lender).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any other tax issues that foreign lenders should be aware of when lending into your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Continuous and regular lending to US borrowers may result in the US government considering such person as engaged in US trade or business, requiring the lender to file a US tax return and pay income taxes on income attributable to such trade or business. Any activities considered secondary trading are generally exempted from such rules, irrespective of continuity or regularity. As such, foreign lenders should take care to limit the extent and scope of their origination activities. If foreign lenders that are engaged in extensive origination activity are also qualified for the benefits of a double taxation treaty and do not have a permanent establishment in the US, the foreign lenders may be protected under the rules of such treaty.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What is the regulatory framework by which an acquisition of a public company in your jurisdiction is effected?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The two primary means of acquiring public companies in the US, by tender offer and by shareholder vote and, in each case, a subsequent merger, are subject to US federal regulation by the Securities and Exchange Commission (SEC), which administers and enforces notice and disclosure requirements. The legal framework for acquisitions of public companies is otherwise a product of corporate law, which varies from state to state. By far, the most common state where public companies are incorporated is Delaware, and Delaware law provides both a one-step merger option, and a two-step tender offer option. Upon meeting certain conditions, a tender offer with respect to a Delaware public company that achieves a greater than 50% threshold (step 1) may be able to squeeze out the minority shareholders (step 2) immediately following completion of the tender offer under the short-form merger statute without needing any additional vote or other action by the shareholders.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the key milestones in the timetable (e.g. announcement, posting of documentation, meetings, court hearings, effective dates, provision of consideration, withdrawal conditions)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In a one-step merger structure, after execution and announcement of a definitive merger agreement, the seller promptly files preliminary proxy materials with the SEC. If the transaction involves any equity consideration, the buyer will also file an SEC registration statement on Form S-4 to register the shares being offered; the Form S-4 would typically be combined with the seller\u2019s proxy statement to constitute a joint proxy statement\/prospectus. The SEC may or may not elect to review a proxy statement\/prospectus. After SEC review and resolution of SEC comments (if any), proxy materials are mailed to shareholders and a shareholder meeting is scheduled. The merger closes once the target shareholders approve the merger and other closing conditions (e.g., obtaining any necessary antitrust or other regulatory approvals, and other customary and negotiated conditions) are satisfied, at which time merger consideration is paid to shareholders. Subject to any antitrust or other regulatory delays, the entire process from announcement to closing can typically be completed in as little as 2-3 months, but can take several months longer if there is an extended SEC review.<\/p>\n<p>For take private transactions adopting a tender offer structure, after announcement, the first key milestone is filing a Schedule TO and offer to purchase with the SEC. The tender offer documents are mailed to the target stockholders and the offer must remain open for at least 20 business days. The SEC may review and comment on the tender offer documents, which can typically occur concurrently with the 20 business day tender period. Upon tendering of a majority of the shares and satisfaction of other closing conditions (including obtaining any necessary antitrust and other regulatory approvals), the tender offer will be consummated and the buyer will have obtained control of the target. Shareholders are generally permitted to withdraw tendered shares during the pendency of the tender offer and the acquirer may withdraw the tender offer under certain circumstances. If a \u201cshort-form\u201d merger is available (which, in Delaware and a number of other states, can occur if the shareholders tender a majority of the outstanding shares), the buyer can immediately squeeze out the remaining minority shareholders in exchange for the same cash consideration provided to accepting shareholders in the tender offer. If not available, the buyer can elect to keep a publicly traded minority \u201cstub\u201d outstanding, or can pursue a long-form squeeze-out merger for the remaining shares, a process that would typically take at least several additional months (as outlined in the preceding paragraph).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What is the technical minimum acceptance condition required by the regulatory framework? Is there a squeeze out procedure for minority hold outs?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Subject to supermajority approval or special voting requirements in the target\u2019s governing documents or other compelling, deal-specific circumstances, a majority of shares outstanding is generally sufficient to approve a merger.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">At what level of acceptance can the bidder (i) pass special resolutions, (ii) de-list the target, (iii) effect any squeeze out, and (iv) cause target to grant upstream guarantees and security in respect of the acquisition financing?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Assuming Delaware law applies (and unless the charter or bylaws specifies otherwise), (i) stockholder resolutions generally require a majority vote, (ii) de-listing would occur when the acquisition is consummated, so in a one-step merger generally after securing the majority stockholder vote and any requisite regulatory clearances or approvals, at which time the buyer would control the target and the de-listing would be effectuated upon closing the merger at that time, (iii) in a two-step merger, after the stockholders tender a majority of the shares and any requisite regulatory clearances or approvals are obtained, the buyer may execute a squeeze out merger as a second step without needing a further stockholder vote and (iv) granting guarantees and security would occur at the closing date.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a requirement for a cash confirmation and how is this provided, by who, and when?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There are no formal regulatory cash confirmation requirements. However, it is fraudulent for a person to announce its intention to conduct a tender offer without a reasonable belief that it will have the means to complete it, and Schedule TO and offer to purchase or proxy materials, as applicable, will each provide information as to the acquiror\u2019s financing arrangements and sources of funds.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What conditions to completion are permitted?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Generally, restrictions on permissible conditions to completion of take private transactions are governed primarily by market convention, negotiating leverage, regulatory requirements applicable to take private transactions (including antitrust and merger control) and the desire of the parties for deal certainty. Unlike certain funds deals in the United Kingdom that are subject to the takeover code, there is no similar regime mandating limits on conditionality for US take private transactions.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">6574<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/126136","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=126136"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}