Strategic Alliances: Preparing to Meet a Lawyer

A successful strategic alliance requires a lot of forethought and planning.  Thus, you should be prepared before meeting with a lawyer so that you do not waste everyone's time.  (Business lawyers usually charge by the hour, so being unprepared will also end up costing you money, because it will take longer for the lawyer you hire to get up to speed on what you want to do.)

The lawyer will want to know who you are and how you can be contacted, and a little about your personal and business background. A lawyer will clearly want to understand your relationship to your business and prospective alliance partners.  He or she will want to be comfortable that you have the authority to speak on behalf of the organization. Therefore, you need to put down relevant information in a logical matter and have it available for the lawyer.

Sometimes, a lawyer may send you a questionnaire to fill out before your first meeting. If this happens, be sure to fill it out and send it in to the lawyer's office before the meeting. Also send along copies of any available documents that may be requested in the questionnaire.

Before you get too far into a meeting or conversation, the lawyer is going to want to know about possible conflicts of interest. He or she will want to know the names of banks or financial institutions that you are having problems with. If the lawyer or the lawyer's firm represents anyone on "the other side of the fence," he or she will have a conflict and will usually not be able to represent you.

Written documentation is especially important in a business setting. Even if a lawyer doesn't ask for documentation beforehand, it's still a good idea to bring a copy of all documents relevant to your situation to the meeting:

• A strategic business plan
• A summary of the information about the businesses participating in the alliance
• A "pro forma" balance sheet, including assets and liabilities that are going to be contributed to or assumed by the new alliance as part of the deal
• A proposed list of investors, directors and officers, including their addresses, telephone numbers, email addresses and other contact information
• A list of vendors, contractors or other parties with whom you're doing or expect to be doing, business
• Tax returns, financial statements or corporate records for your business and, to the extent you have it available, for the alliance participants
• A copy of any documentation that has already been prepared or entered into in connection with the alliance, such as letters of intent, agreements, minutes of meetings and notes outlining how the alliance is to be structured
• Letters, memos and other correspondence relating to the business organization
• Diagram out your business and the proposed alliance. Drawing out a picture before you meet with your lawyer may be the best thing you can do. It will help you to organize your thoughts and help your lawyer understand what you want to do. Identify the parties and contractual relationships.

Your lawyer will ask you about your expectations. Be prepared to give your lawyer good business reasons for what you want to do. Never pursue a legal issue just for the "principle" of the matter.

Questions To Ask Your Potential Lawyer

Prepare a list of questions to take with you to your first meeting. In theory, no question is too silly to ask. Keep in mind, though, that you don't want to scare a lawyer out of representing you. Some questions you might ask a business alliances lawyer would include:

• If you are looking at a lawsuit on an alliance gone bad, ask how much litigation experience the lawyer has:
  • How many cases has he or she handled?
  • Has the lawyer taken any cases to trial in the past year?
  • How many of his or her cases have settled?
  • What does the lawyer think about arbitration or mediation?
  • What percent of his or her practice is in the area of expertise that you need?
  • Does the lawyer usually represent plaintiffs (people bringing a lawsuit) or defendants (people who are being sued)?
  • What problems does the lawyer foresee with your case?
• If you're hiring a lawyer to put together an alliance, you would want to ask similar questions about the lawyer's background:
  • How many transactions of a similar nature has the lawyer handled?
  • How much of his or her work is done in this area?
  • What paperwork is involved and how long will it take to finalize?
  • How would the lawyer go about handling your situation? What is the process?
  • How long will it take to bring the matter to a conclusion?

Money Matters

You'll want to ask how the lawyer would charge for his or her services:

• What is the lawyer's hourly rate?
• What would the estimated fees be for your matter?
• Would the lawyer consider doing the work for a flat fee?
• Would the lawyer consider equity in the venture in lieu of being paid cash for his or her services?
• Would a contingency fee arrangement be possible?
• Does the lawyer advance out of pocket costs?
• Would there be a retainer payable up front?
• Would any unused portion be refundable?

Ask to be provided with a copy of the lawyer's retainer agreement and have it explained to you before you decide on retaining the lawyer or the lawyer's law firm. You may end up paying a lot of money to the lawyer you hire, so make sure you understand what you're signing up for.

Would the lawyer handle the case personally or would it be passed on to some other lawyer in the firm? If other lawyers may do some of the work, can you meet them?

Don't be afraid to subtly quiz prospective lawyers to see if they really know what they're talking about. If they're holding themselves out as having expertise on mergers and acquisitions in your industry, ask them to explain certain aspects of the industry to see how deep their understanding is.

Tom Pedreira is a business lawyer handling matters throughout the Western U.S.  He is with the Seattle law firm of Mikkelborg, Broz, Wells & Fryer, and he can be reached at tpedreira@mbwf.com.

	Selecting A Business Alliance Lawyer
	Meeting With A Business Alliance Lawyer