Practical Law New Zealand resources for those new to corporate transactions

Practical Law ANZ Toolkit w-032-1974 (Approx. 22 pages)

Practical Law New Zealand resources for those new to corporate transactions

by Practical Law New Zealand

Welcome to Practical Law New Zealand's Corporate transactions topic

This toolkit provides information about the key resources available in Practical Law New Zealand's Corporate transactions topic to help lawyers unfamiliar with corporate transactions to navigate this practice area.

The Corporate transactions topic provides up-to-date, practical resources for those practising in the corporate transactions area. Our resources are created and maintained by our team of legal specialists and supplemented with materials written by corporate law experts at leading firms.

Our corporate transactions resources cover a range of subjects, including asset and share purchases and takeovers as well as specialist transactions such as joint ventures, reorganisations and share buy-backs.

In addition to highlighting key corporate law content, this toolkit provides guidance on how to get the most out of Practical Law. We provide tips on how to use our resources most effectively, and how to navigate the Practical Law website, including links to user guides and training support.

To give you a comprehensive introduction to corporate law, we also link out to relevant resources within the Corporate transactions topic.

For additional guidance relating to practising in-house, see our In-house topic.

References to CA 1993 in this toolkit are to the Companies Act 1993.

What is a corporate transaction?

A corporate transaction can encompass a wide array of activities. At its core, though, this term refers to activities and transactions that a company may enter into or undertake; for example, a joint venture, an asset purchase, a takeover or a corporate reorganisation.

Practical Law New Zealand's Corporate transactions topic contains resources on the core activities of a company that a lawyer practising in this area will encounter on a regular basis. Our resources are designed to provide lawyers with a breadth of information across this area, while also providing specific practical guidance on how to complete a deal.

Corporate transactions are rarely undertaken in isolation, and Practical Law New Zealand's resources in related practice areas, such as company and commercial law, will provide the information needed to understand the wider transaction quickly. For information on key materials available to help those new to:

Company law, see Toolkit, Practical Law New Zealand resources for those new to company law.
Commercial law, see Toolkit, Practical Law New Zealand resources for those new to commercial law.

What to expect as a corporate lawyer

A lawyer's role in a corporate transaction is as broad and varied as the topic area. Although the work will generally centre on matters related to companies incorporated under and regulated by the CA 1993, the scope of the work will often be expansive. For example, a corporate lawyer may need to advise on the formation of a joint venture, which requires knowledge of the legal issues related to joint venture structures. Another transaction may require advising a company on how to undertake a share buy-back or a business acquisition. Corporate lawyers also need a comprehensive knowledge of company and contract law.

More specifically, corporate lawyers can expect to be involved in some or all of the following:

Drafting agreements (for example, asset or share purchase agreements) and advising on existing contractual relationships, rights and obligations; terminating, varying or novating agreements; and advising on the consequences of these transactions.
Advising on the NZX Listing Rules and regulations relating to listed company transactions.
Advising on corporate structures, for example, as part of a corporate reorganisation or in connection with the creation of a joint venture.
Advising an entity or its shareholders on the shareholders' rights and obligations; negotiating and documenting changes to those arrangements.
Providing advice and support to clients and due diligence committees that are undertaking due diligence, including reviewing and reporting on issues related to material contracts the subject of the due diligence.

Tips on how to use our content

Here are some suggestions on the various ways that you can use our resources:

If you are asked to attend a meeting about a topic that you are not that familiar with, or you know has been impacted by recent changes in law, review the relevant practice note, which will give you a high level understanding of the topic and the current legal requirements. For example, if you are meeting to discuss a client's plan to buy a business, Practice notes, Asset purchases and Share purchases will give you an overview of the topic and confidence that you are on top of the pros and cons of the difference purchase structures.
If you are asked to review a client's internal precedents, take a look at Practical Law's version of the standard document so you are aware of the current legal and market requirements. For example, if reviewing template minutes of a board meeting held to approve the registration of a transfer of shares in an unlisted company, look at Standard document, Board minutes: transfer of shares to ensure that the client's version is comprehensive and that reflects best market practice.
If you are negotiating a document that has been drafted by the counterparty, look at Practical Law's version of the standard document to ensure that key terms relevant to your client have been included and that you are aware of terms that would be particularly beneficial to the counterparty. For example, if negotiating a heads of agreement in the asset purchase context, referring to Standard document, Heads of agreement: asset purchases will highlight the key issues for your client.
If you are asked to draft a document based on high level instructions from your client, refresh your memory about the issues relating to that type of document by reviewing the relevant practice note or the drafting notes in the relevant standard document (or both). For example, if asked to draft a disclosure letter in the context of a share purchase, take a look at:
- Practice note, Disclosure letters, which explains the use of disclosure letters in the context of share purchases; and
- Standard document, Disclosure letter: share purchase, a standard disclosure letter for use in a share purchase that can be amended to reflect the client's instructions, as well as detailed drafting notes to help with that redrafting exercise.
Before using one of our standard documents, reading through the whole standard document and its drafting notes will allow you to understand the intention of each clause, which will help you to better amend it to reflect the terms of the specific transaction.

Materials

Resource types

Practical Law New Zealand's Corporate transactions topic provides access to a collection of practical resources that is constantly updated to reflect the latest changes in law and practice. This ensures that corporate lawyers remain up-to-date with legal developments and the practical implications of those developments, without needing to wade through lengthy and, often, irrelevant cases, commentary and legislation.

Our materials include the following types of resources:

Practice notes. Our practice notes provide clear and up-to-date explanations of law and practice. We consult primary sources, practitioners and leading texts, distilling the principles so you can rely on the information to advise with confidence. These are likely to be your best starting point when looking at a particular aspect of law for the first time. For a full list of Practical Law New Zealand's corporate transactions practice notes, see Asset purchases practice notes and Share purchases: private practice notes.
Standard documents. Standard documents are template documents that include agreements, minutes, notices and letters. Created by our team of experts to assist you when drafting, our standard documents include embedded drafting notes, which provide guidance on issues to consider when drafting and negotiating the document. They can be downloaded in Word for easy editing. For a full list of Practical Law New Zealand's corporate transactions standard documents, see Asset purchases standard documents and drafting notes and Share purchases: private standard documents and drafting notes.
Standard clauses. Our standard clauses are provided for use in common corporate agreements. As with our standard documents, our standard clauses include drafting notes to guide users through issues to consider. They can be downloaded in Word for easy editing and incorporation into other agreements. For a full list of Practical Law New Zealand's corporate transactions standard clauses, see Asset purchases standard clauses and drafting notes and Share purchases: private standard clauses and drafting notes.
Checklists. Our checklists provide a quick point of reference on the law as it applies in practise, and can be used to ensure that you have all the relevant issues covered. For a full list of corporate transactions checklists, see Asset purchases checklists and Share purchases: private checklists.
Glossary. The glossary provides definitions of key terms that you may come across in a corporate transaction, as well as key commercial, contract and industry terms. For access to our full list of glossary terms, see Glossary.
Videos. A compilation of short videos featuring training and thought leadership for lawyers on various areas of practice, such as contracts, data protection, technology and social media, are available on demand. For access to our library of video resources organised by category, see Practical Law New Zealand's on-demand video library.
Global guides. Global guides provide Q&A overviews of laws and regulations in more than 100 countries, with in-depth coverage available for more than 20 key jurisdictions. The Q&As span more than 60 unique Country Q&A sets, are written by leading lawyers, and can be viewed individually or through a Country Q&A comparison tool which allows users to compare answers to key legal questions across various jurisdictions. For a full list of global guides across various areas of law, see Global guides.

Navigating the Practical Law New Zealand's Corporate transactions topic page

Content on the Practical Law New Zealand Corporate transactions topic page can be reached in several ways, including:

Using the search facility in the toolbar at the top of each page on the Practical Law website. To get the most out of the search function, see the Practical Law User Guide: Searching for New Zealand resources.
Browsing the relevant topic by accessing the "Topics" tab on the Practical Law New Zealand Resource Centre homepage.
Via the "Resources" tab on the Practical Law New Zealand Corporate transactions: Asset purchases and Share purchases: private topic pages, if you know the type of content you want (for example, if you know that you are looking for a practice note).
Via the "Related Content" button (located at the top right of each resource) which takes you to the list of related resources displayed at the end of each resource.

User guides

For a general guide on how to use the Practical Law website:

See the Practical Law User Guide.
Visit the Practical Law training and support customer portal at Practical Law Australia (including NZ Resource Centre) Support.
Contact our Customer Help Desk on 0800 10 60 25.

Training on using Practical Law New Zealand Corporate transactions

Free training on how to use Practical Law more effectively and get the most out of your subscription is available in a variety of formats:

Interactive online training sessions are designed to provide an overview on the features and functionality of Practical Law. For a comprehensive schedule of available training sessions, see Practical Law Webinars.
Personalised training from a member of our team can be given in your office, over the telephone or online to increase your confidence in using Practical Law. For information on requesting a personal training session, see Request Training.

General contract law and boilerplate

A firm understanding of the fundamental principles of contract law is vital for any lawyer working on corporate law transactions. Practical Law New Zealand's Contract law topic offers a series of practice notes covering these principles, together with practical information to assist with drafting contracts.

Key contract principles

Toolkit, Contract management and administration provides links to Practical Law New Zealand's core contract law practice notes, which explain the key principles governing a New Zealand law contract from formation through to termination. Areas covered include:

Contract formation.
Variation of contracts.
Assignment, novation and subcontracting.
Terminating a contract.
Remedies for breach of contract.

For a full list of all our contract law practice notes, see the Contract law topic index.

Drafting contracts: guidance

Most contracts follow a similar skeleton structure. We provide practice notes to guide you through the function of each part of the contract. We also have notes highlighting issues associated with particular types of clauses. All these resources are listed in Toolkit, Contract management and administration and the Contract law topic homepage. Key introductory resources include Practice notes:

In addition, detailed drafting notes are integrated into each Practical Law New Zealand standard document and clause, which provide contextual guidance on the clauses and what they are intended to achieve. The drafting notes may cover how the clause can be adapted to fit particular situations, and the legal and negotiating issues of a clause from the point of view of each of the parties.

For a full list of Practical Law New Zealand's contract law standard documents and clauses, see Contract law standard documents and drafting notes and Contract law standard clauses and drafting notes.

Execution formalities

The formalities required for execution will vary depending on the type of contract being signed, the identities of the parties signing and the governing law of the contract. For a guide to Practical Law New Zealand's resources relating to the valid execution of deeds, agreements and other documents, including links to the relevant resources, see Toolkit, Execution of deeds, agreements and documents.

Clause banks

Boilerplate clauses

Boilerplate clauses are generic clauses that generally deal with the operation of the contract itself (and not necessarily with the specific transaction between the parties). They can be found in all types of contracts.

Common boilerplate clauses include Standard clauses:

Standard documents, Boilerplate agreement and Boilerplate deed set these out, and include detailed drafting notes for each clause, explaining its purpose and the associated legal and negotiating issues from each party's perspective.

Additional clause guidance

In addition to boilerplate clauses, we provide detailed guidance on some of the more complex contract clauses. For example, see Practice notes:

For a full list of common contract templates including agreements, deeds and notices, and generic boilerplate clauses, see the General contracts and boilerplate topic index.

Corporate transactions content

Practical Law New Zealand's Corporate transactions topic provides in-depth guidance on a range of specific topics relevant to a corporate transactions practice. In addition to core topics such as asset and share purchases, due diligence, financial assistance and takeovers, our content includes information on specialist transactions such as joint ventures, corporate reorganisations and share buy-backs.

Asset and share purchases

Acquiring assets or shares in a company will often be complex. In addition to the necessary acquisition documents, the transaction will usually involve a number of other issues for lawyers to consider, including issues relating to transaction structuring, confidentiality, seller warranties and indemnities and post-acquisition integration.

For information about the legal issues relevant to an asset or share purchase, and for standard documents to use during the transaction, see:

Practice notes:
Standard documents:
Checklist, Integration planning and implementation: purchases.

Pre-transaction agreements

There are a range of pre-transaction issues that arise between potential vendors and purchasers that a corporate lawyer will be asked to address before the acquisition transaction even commences. The main areas that usually arise are matters relating to the confidentiality of information shared between the parties, negotiation of and drafting the term sheet and exclusivity arrangements. For more information, see:

Practice notes:
Standard documents:

For a full list of our pre-transaction resources, see our Pre-transaction agreements and confidentiality topic index.

Due diligence: purchases

Due diligence is a critical part of all asset or share purchase transactions for both the buyer and the seller.

Lawyers acting for the seller need to work with their client to understand what information needs to be disclosed, to whom it will be disclosed and how to open and manage a data room. Lawyers acting for a buyer need to determine the relevant materials to review, the enquiries to make and the process they will undertake to identify any issues that may have a negative impact on their client.

For more information about due diligence, and questionnaires and checklists to assist in carrying out the process, see:

To see all of our resources related to asset or share purchase due diligence, see our Asset purchases and Share purchases: private topic indexes.

Financial assistance

Financial assistance issues most commonly arise in the context of a share acquisition where the buyer provides debt to fund the purchase price or the target company provides security for the sellers' obligations under the acquisition documents. The CA 1993 prohibits the provision of financial assistance unless certain conditions are met. For more information, see Practice note, Financial assistance.

Overseas investment

Overseas investors commonly participate in the acquisition of New Zealand assets and companies. These investments are controlled by governmental policies, legislation and regulatory instruments. These also set out the decision-making roles and power of the Overseas Investment Office, which acts as the key administrative body involved in assessing requests by overseas investors to make certain investments.

For more information about overseas investment regulation and oversight, see Practice note, Regulation of overseas investment in New Zealand.

Takeovers

Companies also participate in takeover transactions, either as the party making a takeover bid or as the target (either in a friendly acquisition scenario or via a hostile takeover). The Takeovers Act 1993 and the Takeovers Code regulate takeover transactions, including to ensure equal treatment of shareholders.

For more information about the legal issues related to takeovers, including the regulatory requirements, see Practice notes:

Specialist transactions

Share buy-backs

The ability of companies to buy-back their shares make investment and participation in smaller companies more attractive, by providing shareholders with a means of disposing of their shares and by allowing the remaining shareholders to maintain control and ownership of the business.

A company wishing to buy back its own shares must comply with the procedures set out in the CA 1993 as well as its constitution and shareholders' agreement (if any). The CA 1993 sets out the various types of share buy-back a company can conduct and the requirements for each transaction type.

For more information, see Practice note, Share buy-backs.

Additional tools and resources

In-house resources

Our In-house topic provides a wide range of resources for in-house lawyers and lawyers transitioning to an in-house role.

Our in-house resources include the following Practice notes:

For a full list of in-house materials, see our In-house topic index.

COVID-19 resources

Practical Law New Zealand has produced a large number of resources on the 2019 novel coronavirus disease (COVID-19) to help practitioners as they navigate the legal, practical and business risks arising from the pandemic. The full list of resources produced by Practical Law New Zealand and Australia in response to COVID-19 can be found at the COVID-19 (Coronavirus) Resources page. Some highlights include:

Additional cross-jurisdictional guidance on COVID-19 can be found in the:

Capital Markets Global Coronavirus Toolkit, which provides materials relating specifically to capital markets.
Corporate Global Coronavirus Toolkit, which provides material relating to corporate issues and business interruptions.
COVID-19: Pandemic Response global content page, which provides materials related to various areas of law across the Practical Law platform.

Linking to Westlaw NZ

Practical Law New Zealand’s maintained resources come with complimentary one-click links to cases on Westlaw NZ, allowing you to examine the law for yourself. If you wish to dig deeper and access the extensive legislation, case and commentary resources on Westlaw, you will need to have the relevant Westlaw subscriptions.

FirmStyle

FirmStyle is a feature of Practical Law New Zealand that automatically converts Practical Law's standard documents and standard clauses into your house style, at a fraction of the time and cost of doing it yourself.

For further information, see Help and information note, Practical Law FirmStyle.

Feedback

We strongly value any input that users may have on how to improve both the content and user experience of the Practical Law platform. As such, we welcome any feedback relating to topics you would like to see covered on Practical Law New Zealand or ways to make the service more user-friendly. You can provide feedback in two ways, including:

Via the "Feedback" link found at the top and bottom of the Practical Law website.
Via the "Provide Feedback" button found at the bottom of the toolbar on the right-hand side of all Practical Law resources. This option allows you to provide feedback relating to the content in the specific resource in which the feedback button was used.

Automated documents

A selection of our most popular standard documents is available as Practical Law Automated Documents, powered by Contract Express. Users have the option to automate the completion of these documents using a user-friendly questionnaire, allowing you to produce a first-draft document in less time, based on expertly drafted and fully maintained Practical Law New Zealand precedents. This will ensure quality and consistency so you can delegate drafting with confidence.

For guidance on the functionality of Contract Express, see Automated documents user guide.

Keeping track of developments

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Guidance on how to further personalise your Practical Law experience can be found in the Practical Law User Guide.

Practical Law New Zealand resources for those new to corporate transactions | Practical Law