Incorporation of a Hong Kong company limited by shares as a special purpose vehicle (spv) or holding company
Some clients I work with require the incorporation of a Hong Kong limited company in the process of their private equity, M&A or capital markets investments. I have helped a lot of clients incorporate such company which is mainly used as a special purpose vehicle (SPV) or a holding company. In this article, I discuss [...]
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Confidentiality agreement or NDA – restricted use of confidential information
This is another post on NDA. I wrote a post on return or destruction of confidential information not long ago. This post is on restricted use of confidential information.
I have only a few points to make.
1. Normally, Seller will be disclosing confidential information not just to Buyer, but also to Buyer’s Representatives. Representatives may include [...]
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Confidentiality agreement or NDA – return or destruction of confidential information
Let’s talk about confidentiality agreement (aka non-disclosure agreement or NDA) in this post – specifically on the clause relating to return or destruction of confidential information. There may be a confidentiality clause in a term sheet, but in this post, we are focusing on NDAs.
You will almost definitely see a clause relating to return or [...]
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Venture capital lawyer or law firm recommendation and referral
I have written a lot of posts on this website about venture capital funding and have received a lot of emails from readers thanking me for such great help – some on the posts I wrote, on advice I gave them through emails, and on the Askventure.com cap table which they can download free from [...]
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What are demand and piggyback registration rights in a venture capital investment?
This article discusses the two types of registration rights that you will find in a typical venture capital financing – demand registration rights and piggyback registration rights.
Why do you need to register your shares?
Skipping all the legal nonsense and jargon, if you want to sell shares of a company on a stock exchange in the [...]
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Sample liquidation preference clause in a typical venture capital term sheet
I get asked a lot for a sample clause on liquidation preference used in a typical venture capital term sheet. So, I’ve put together an all-in-one sample clause here for your reference. The good thing about this sample clause is that it covers or can be modified to cover the scenarios of
(1) participating preferred with a [...]
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Exercise price of share option under a share option scheme of a Hong Kong listed company
This article sets out the basis of determination of the exercise price of share options to be granted under a share option scheme of a company listed on The Stock Exchange of Hong Kong Limited (Hong Kong Stock Exchange).
Hong Kong Listing Rules
If the shares of a company is listed on the Hong Kong Stock Exchange, [...]
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Venture capital exits – trade sale vs IPO – compared and analyzed
Way before a venture capitalist invests in a company, he is already thinking how and when to exit from the investment. This article tells you why and compares between the two venture capital exits – trade sale and IPO.
Illiquid nature and limited life-span of a VC fund
A well-planned exit is particularly important in a VC investment [...]
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What is vesting period of an employee stock option plan (ESOP)?
This article discusses what vesting period is in the context of employee stock option plan (ESOP) – something that a company needs to decide when adopting an ESOP or when granting options under an ESOP. I will also set out different examples of vesting periods.
What is vesting period?
Vesting period refers to the minimum period for which [...]
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Participating vs non-participating preferred stock in liquidation preference
What is liquidation preference?
Liquidation preference refers to preferred stockholders’ rights to receive a certain amount for the preferred stock they hold in preference to common stockholders in the event that a company goes into liquidation.
What is non-participating preferred stock?
Non-participating preferred stock means in the event of a liqudiation, preferred stockholders will receive a certain amount [...]
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