In this episode of The Transaction Abstract Podcast, Joe Hellman sits down with Kim Lowe, Partner at Avisen Legal, to discuss the most common legal challenges that surface during a transaction. Drawing from nearly 30 years of experience representing both buyers and sellers, Kim shares practical insights on how early preparation, clear communication, and the right advisory team can help business owners avoid unnecessary deal complications.
While valuation tends to get the spotlight, many obstacles in a deal stem from inexperience and lack of preparation. This is especially true for first-time sellers who may not know what to expect from the process.
Inexperienced advisors can unintentionally create friction by overcomplicating negotiations or misunderstanding key stages like the Letter of Intent (LOI). “It never kills a deal, but it does slow it down,” Lowe explains. “Having advisors who aren’t comfortable in the M&A space can make everything take longer, from the LOI to diligence.”
When sellers or their long-time attorneys haven’t been through a transaction before, the learning curve can be steep. Even standard diligence requests can feel intrusive, leading to hesitation that drags out the process.
Workforce-related issues often become some of the most sensitive and time-consuming parts of a deal. From background checks to employee classifications, these topics can quickly become roadblocks if sellers resist transparency.
Buyers naturally want to understand the workforce they are inheriting, but sellers sometimes try to restrict access out of fear or loyalty to their team. “It’s better to get it out there and move forward than to spend a month fighting over it,” Lowe advises.
Employee misclassification or authorization problems can also carry lasting consequences. “No buyer wants to assume a seller’s employment obligations,” she explains. “Those damages can be significant and create major complications.”
In family-owned or closely held businesses, challenges often arise around who will stay involved after the sale. Sellers may hope that their children or relatives will continue in leadership roles, but those expectations do not always align with a buyer’s operational plans or compensation structures.
“We can spend months just negotiating one employment arrangement,” Lowe says. “It’s often not about the money, it’s about fit.”
Having these discussions early, before a deal is in motion, helps prevent emotional and financial tension later.
Another common challenge involves unclear ownership of assets such as intellectual property, patents, or minority shares. These issues often trace back to partner exits or outdated documentation.
“You’d be surprised how many times we have to go back to someone who left years ago to get signatures or releases,” Lowe says. “They’re never going to agree without getting a pound of flesh.”
For companies with multiple shareholders or family members, even small ownership stakes can create major complications if not addressed ahead of time. Lowe recalls deals that took months to close while families negotiated the value of a single sibling’s shares.
Both Lowe and Hellman emphasize that early preparation is the best way to ensure a smoother, faster transaction. Sellers should start by organizing financials, clarifying ownership records, and surrounding themselves with experienced advisors who understand the M&A process.
Lowe also encourages business owners to plan beyond the immediate deal. “Make sure your trustee is still competent when you get to the end,” she says, recalling past deals delayed by estate planning oversights.
Listen to the full episode of The Transaction Abstract Podcast to hear Joe Hellman and Kim Lowe share more real-world examples and practical advice on navigating the legal side of buying or selling a business.