WA Business Law Blog

This is Part 2 of a two-part series on structuring and enforcing earnouts in middle-market M&A transactions. If you missed it, read Part 1: Revenue vs. EBITDA: Choosing the Right Earnout Metric to see how setting the right financial targets impacts the deal. When a merger or acquisition utilizes an earnout to bridge a valuation… Read More

In one of my previous posts, What the 2027 Washington Real Estate Excise Tax Shifts Mean for You, I broke down the statutory rate tier adjustments taking effect under RCW 82.45.060 on January 1, 2027. While those upward bracket shifts may provide meaningful tax savings on higher-value properties, Washington’s Real Estate Excise Tax (“REET”) structure… Read More

This is Part 1 of a two-part series on structuring and enforcing earnouts in middle-market M&A transactions. Part 2 focuses on post-closing operational covenants and governance. When negotiating an earnout in a middle-market M&A transaction, choosing the underlying metric is one of the most critical decisions both parties will make. The two primary choices, gross… Read More

Earnout provisions are among the most creative and, simultaneously, the most litigated structures in M&A transactions. When a buyer and seller cannot agree on purchase price because they disagree about the future performance of the business, an earnout can bridge the gap—allowing the seller to receive additional consideration if the business achieves agreed-upon milestones after… Read More

Legal due diligence is the process by which a buyer’s attorneys systematically review the legal health of a target business before committing to a purchase. It is not glamorous work, but it is among the most valuable work done in any transaction. The goal is not to find reasons to walk away from a deal—it… Read More

When buying or selling real estate or structuring corporate asset transactions in Washington, tax considerations are rarely far from mind. One of the most significant state level costs in any transfer is the Real Estate Excise Tax (“REET”). Under RCW 82.45.060, Washington uses a graduated rate structure for state REET. Rather than a flat percentage… Read More

When a buyer and seller agree on a purchase price, many people assume the hard part of the negotiation is over. In reality, some of the most consequential decisions in any M&A transaction are made after the headline number is set—starting with the fundamental question of deal structure. Whether the transaction is structured as an… Read More

Revenue is what most business owners focus on when thinking about valuation. Revenue matters—but sophisticated buyers do not just look at how much revenue a business generates. They look at the quality and durability of that revenue: how it is contracted, how long it has, how protected it is, and whether it will survive a… Read More

In the world of mergers and acquisitions, “sandbagging” refers to a buyer’s decision to proceed with a transaction despite discovering—before closing—that one or more of the seller’s representations and warranties are false. The buyer closes the deal anyway, then later asserts an indemnification claim for the breach. The practice raises a fundamental question: should a… Read More