Corporate Reorganizations: Structuring Internal Mergers, Split-Offs, Asset Transfers, Recapitalizations

Arms Length Transactions, Shareholder and Other Approvals, Contractual Limitations, Employment and Tax Issues

Note: CPE credit is not offered on this program

A live 90-minute premium CLE video webinar with interactive Q&A

This program is included with the Strafford CLE Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Wednesday, March 16, 2022

1:00pm-2:30pm EDT, 10:00am-11:30am PDT

Early Registration Discount Deadline, Friday, February 18, 2022

or call 1-800-926-7926

This CLE webinar will examine issues associated with strategic corporate reorganizations, including consolidations, spin-offs and split-offs, recapitalizations, and transfers of shares or assets between entities within a company. The panel discussion will include due diligence, shareholder and third party approvals, contractual and financing limitations, IP and licensing concerns, and employment and tax matters.

Description

There are a variety of ways to approach a corporate reorganization. The selected method will depend on the desired goals of the company, the state laws which govern its entities or assets, the impact on its employees, and the tax ramifications of the reorganization, among other factors.

Several issues should be considered upfront. There may be a federal or state mandated waiting period for particular actions or required governmental filings and approvals. Shareholder approval and board approval may be necessary. There may be debt covenants that prohibit the transaction or require lender consent. Other third-party consents (for the transfer of IP rights, for example) may also be required.

Section 368 of the IRC provides for tax-free reorganizations when structured under its provisions. Tax counsel should be involved in any reorganization to minimize tax consequences and preserve tax attributes. The issues are particularly complex, and counter intuitive, when stock or assets move across borders.

An acquisition or merger often involves transferring employees from one entity to another. Sister entities may need to terminate and rehire affected employees and appropriately document the change in the employing entity, recognizing the employees' prior service years at the transferor entity and accrued vacation or paid time off. The company should also consider any obligations under the WARN Act.

Listen as our authoritative panel discusses the multifaceted issues companies and their counsel must navigate in planning and implementing corporate reorganizations.

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Outline

  1. Corporate reorganization types and strategies
  2. Upfront concerns
    1. Board and shareholder consents
    2. State law requirements
    3. Requirements of foreign countries, if applicable
    4. Third-party consents: lenders, contract parties, IP licensors
  3. Tax treatment
    1. Tax-free reorganizations under Section 368
    2. Demonstrating the reorg is arm's length from a valuation standpoint
  4. Securities law issues, if applicable
  5. Transferring employees between entities

Benefits

The panel will review these and other critical issues:

  • What are the typical motivations behind corporate reorganizations, and how do they affect the structure?
  • How do state and foreign laws vary in their treatment of internal reorganizations?
  • What are the best practices for transferring employees between organizations? When does the WARN Act apply?
  • How can a reorganization be structured to minimize the tax impact?

Faculty

Royse, Roger
Roger Royse

Partner
Haynes Boone

Mr. Royse has practiced tax and corporate law since 1984. He provides services to a wide spectrum of clients, from...  |  Read More

Additional faculty
to be announced.
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Early Discount (through 02/18/22)

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Early Discount (through 02/18/22)

You may pre-order a recording to listen at your convenience. Recordings are available 48 hours after the webinar. Strafford will process CLE credit for one person on each recording. All formats include course handouts.

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