News & Analysis as of

Liquidation Venture Capital Investment

Wyrick Robbins Yates & Ponton LLP

What is Liquidation Preference?

​In a venture capital deal, a liquidation preference refers to the payout investors receive in a liquidation event (like a sale or merger) prior to any payments made to the common stockholders. Venture capital investors...more

Farrell Fritz, P.C.

“Beyond Redemption”: SPAC Shareholder Redemptions and New Excise Tax Could Lead to Year-End Rush to Close or Liquidate

Farrell Fritz, P.C. on

Just last week, special purpose acquisition company The Music Acquisition Corporation (“TMAC”) called a special meeting of its stockholders.  It wasn’t the special meeting it originally envisioned.  TMAC was launched in...more

Farrell Fritz, P.C.

“Whoever has the Gold, (Once Again) Makes the Rules”: VC Deal Terms Likely to be More Investor Favorable

Farrell Fritz, P.C. on

It’s no shocker that the Coronavirus pandemic has slowed down venture capital investment dramatically, with 2020 now on pace to be well below the high levels of the past couple of years.  According to Pitchbook, VC deal flow...more

Farrell Fritz, P.C.

Irredeemable: Delaware Case Will Make Redemption Rights Tougher to Enforce

Farrell Fritz, P.C. on

Venture capital funds routinely negotiate for a right of redemption – the right to require the company to buy out their shares after a certain period of time if an exit has not occurred – as a key element of their exit...more

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