Tax

Tax (leger And Mollo Christensen)

Overview

Choate’s tax and executive compensation attorneys specialize in complex middle-market transactions, with a focus on advising leading private equity funds, venture capital funds, and their portfolio companies in mergers and acquisitions, LBOs, growth equity investments, recapitalizations, carve-outs, sales and divestitures, and all aspects of fund formation and capital raising.

Tax: Our team of tax experts has extensive experience in mergers & acquisitions involving both strategic and financial buyers (including numerous private equity fund sponsors), international tax planning and structuring of cross-border transactions – particularly involving Australia, Canada, China, France, India, Ireland, and the UK, as well as numerous other foreign jurisdictions – and investment fund formation, including private equity and venture capital funds, as well as domestic and offshore alternative investment vehicles (“AIVs”).

Executive Compensation: We regularly advise publicly-traded companies, private businesses and tax-exempt organizations, as well as senior executives and compensation committees, on a range of design, implementation, governance, disclosure, and transactional issues, with particular expertise in M&A and private equity transactions.

In addition to tax and ERISA matters, our team also brings deep experience with the securities, employment and corporate laws relating to executive compensation and employee benefit plans.

Tax

  • Represented Sunstone Partners, a private equity firm that invests in AI- and technology-enabled services and software companies, in its sale of Knowtion Health, a company that helps medical providers and patients navigate complex payer challenges and optimize revenue cycles. Tax aspects of this matter transaction structuring and negotiating and drafting transaction documents, including blocker and rollover structuring.
  • Represented Long Ridge Equity Partners in connection with the sale of NinjaTrader, a U.S. retail futures trading platform and Long Ridge portfolio company, in a landmark $1.5B sale to cryptocurrency exchange Kraken. Tax aspects of this matter included tax structuring advice related to tax-efficient structuring for closing cash proceeds, earnout proceeds, taxable rollover stock in Kraken, contingent put rights for rollover stock, and receipt of seller note to be combined under a single credit facility with a third-party lender.
  • Represented Great Hill Partners in connection with its sale of EvolveIP, LLC, a company that provides desktop-as-a-service, unified communications, and other cloud services, to ATSG (a portfolio company of RunTide Capital), a global technology provider for cloud, IT managed services, and cybersecurity. Tax advice on this matter included transaction structuring and negotiating and drafting transaction documents, including structuring for recognition vs. non-recognition of tax loss in given 100% equity consideration and lender equity structuring.
  • Represented BV Investment Partners and its portfolio company, Becklar, in Becklar’s investment from Graham Partners. The tax aspects of this matter included structuring, drafting and negotiation of various tax provisions across the transaction documents.
  • Represented Marcy Venture Partners, a VC sponsor focused on investing in consumer and culture-forward businesses, in its merger with VC sponsor Pendulum Holdings. Tax advice on this matter included tax structuring and drafting of complex economic provisions.
  • Represented Serent Capital in its strategic partnership with StockIQ Technologies, a leading provider of supply chain planning software for manufacturers and distributors. Tax aspects of this matter included tax structuring to qualify Serent’s investment entity as a “qualified small business corporation” in acquisition of target classified as an S-corporation for tax purposes and tax-efficient rollover for the founders and management team.

Executive Compensation

  • Represented Novacap, a leading North American private equity firm, as it entered into a partnership with Communications Tower Group I LLC (“CTG”). This transaction was particularly involved from an executive compensation perspective because the executive team were founders with substantial ownership in the go-forward business, so had much greater leverage and negotiated complex equity rights and go-forward employment and severance terms.
  • Represented Kadant Inc. in its acquisition of all of the outstanding equity interests of Key Knife, Inc., a Washington-based global supplier of engineered knife systems for custom chipping, planing and flaking solutions for wood product industries, and certain of its subsidiaries. The target company was owned by an employee stock ownership plan (an “ESOP”), which presented complex transaction and benefits issues, including those affecting transaction certainty given the specific fiduciary and related issues that arise vis-à-vis the independent trustee of the ESOP.
  • Represented Serent Capital in connection with the sale of its portfolio company, Sceptre Hospitality Resources, LLC (SHR), to The Access Group, a UK-based business management software company. The international employee nature of this transaction involved complex ex-U.S. equity issues, including the need to address historic compliance issues that presented significant deal considerations.
  • In October 2023, Rite Aid Corporation, along with a number of its affiliates and subsidiaries, filed petitions for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of New Jersey (Case No. 23-18993). The executive compensation and benefits team was involved in multiple aspects of Bank of America’s involvement in the Rite Aid bankruptcy, assisting with the negotiation of the debtor-in-possession facility and assessing complex pension and severance liabilities that could impact Bank of America and other secured lenders.
  • Represented Sunstone Partners in multiple deals over the past year; two recent transactions include the acquisition of Accuhealth, and representation of Accuhealth in connection with its acquisition of Signallamp Health, Inc. The combination of working on essentially two transactions simultaneously, a platform deal with a planned add-on, created additional complexity in putting together the go-forward equity and management arrangements so that they met the business needs of both the Accuhealth team and the Signallamp teams.
  • Represented Apryse Software Corp., a portfolio company of Thoma Bravo, in its acquisition of LEAD Technologies, Inc., a software solutions provider of document imaging and processing technology, assisting with various executive compensation and employee benefits aspects of the matter.