Where to source a lawyer? My area or the acquisition’s area?

June 12, 2024

by a searcher from The University of Michigan - Stephen M. Ross School of Business in Portland, OR, USA

I’m looking into a deal in a state different than my own and I’m trying to source a lawyer. There are few in the area where the business is but many in my home area. Does it matter where the lawyer is from? Would it be beneficial to use a lawyer or any professional service local to the acquisition?

0 Likes

24 Replies

153 Views

Replies

Reply by a professional
from American University in Irvine, CA, USA

Hi, Josh. That's a really good question. The general rule is that attorneys who are not licensed in a given state cannot provide legal opinions as to the laws of that state. I do have clients that make acquisitions in various states outside of California, where I am licensed. Typically, the "business" documentation of their deals is not very different, but I let them know that I cannot advise as to the "local" law. In those cases, my clients will often still ask me to draft the documentation for their deal (because they know me and my forms, and I know their companies), but we will have a local lawyer from the transaction state make a review prior to finalizing the docs, to provide an opinion as to enforceability in the target state, and raise any other local law issues there may be. If the nature of the transaction requires state-specific aspects (such as local permitting, zoning, etc.), we will bring in the local counsel earlier.. We also assess whether other local professionals (CPA, consultants, bankers) are advisable in the target state, and will help build the team if they are are.

Reply by a lender
in United States

There are many factors to consider, such as whether the deal size is classified as Main Street SMB or middle market, if the funding source will be SBA, the counsel's industry experience, if applicable, state requirements, and more ^redacted‌. I've reviewed closing settlement statements over my career reflecting attorney fees. Many Main Street SMB buyers engaged middle-market M&A attorneys, not knowing any better, with a very high price tag meant to support the more significant M&A transactions. I support the small Main Street deals with SBA-backed financing. If your transaction fits this criteria, private message me, and I can provide my short list of reputable attorney recommendations. Thanks for the heads up ^redacted‌.‌

+22 more replies.

Join the discussion