LEGA

Question 1

2-step tender offer acquisition vs 1-step proxy acquisition

Answer 1

1-step: 1. need to send proxies to shareholders, give them more time to familiarize themselves with materials, 2. hold shareholder vote and get >50% of shareholders

2-step: 1. tender offer for shares - announce an offer outstanding at least 20 business days. 2. if >90% of shareholders tender their shares then acquisition is complete (if an institutional investor holds close to or more than 10% - one investor can fail the tender offer)

Question 2

Red flags in a startup decks

Answer 2

• Missing talent/skills on the team
• Cap table with people who are not involved in the business
• Raising money to survive rather than grow
• Vanity metrics (sign ups, beta users etc) either don’t know better or don’t have better metrics to show - need to show revenue, users, conversion rates, retention rates
• Not enough money to successfully get to the next fundable milestone (i.e. not just develop product but to start sales) or profitability