Corporate Finance Advisory Lawyer
Corporate Finance Advisory Lawyer | Getting the deal structure and paperwork right from the start
Corporate finance advisory covers the legal review and structuring of transactions where a company raises or deploys capital: equity investment rounds, convertible bonds, loan agreements, syndicated financing, and financing components of M&A deals. The core issues are usually not whether a deal happens, but under what terms — valuation mechanics, control rights, security interests, and default remedies. A mismatch between the commercial term sheet and the legal documentation is where most post-closing disputes originate.
Corporate Finance Advisory | Which financing structure fits your situation?
Companies typically raise capital through one of these structures, each with different implications for control, repayment obligations, and disclosure. The right choice depends on your growth stage, cash flow, and how much dilution or debt you can absorb.
| Repayment obligation | None — investors take equity risk |
| Control impact | Dilution, board seats, veto rights |
| Key document | Shareholders' agreement, investment agreement |
| Typical investor | VC, PE, strategic investor |
Preferred shares issued to investors often carry redemption and conversion rights that must be structured under the Commercial Act's preferred stock provisions (상법 제344조 이하).
| Repayment obligation | Yes, unless converted to equity |
| Control impact | Deferred dilution upon conversion |
| Key document | Bond subscription agreement |
| Typical investor | PE, mezzanine funds |
Issuance procedures and conversion terms are governed by the Commercial Act's provisions on convertible bonds (상법 제513조).
| Repayment obligation | Fixed schedule, interest-bearing |
| Control impact | Covenants restrict certain actions |
| Key document | Loan agreement, security agreement |
| Typical investor | Bank, institutional lender |
Security interests such as pledges over shares or receivables are perfected under the Civil Act's provisions on pledges (민법 제345조 이하) or the Act on Registration of Security over Movable Property, Claims, etc.
| Repayment obligation | Depends on structure (debt/equity mix) |
| Control impact | Often full change of control |
| Key document | SPA plus financing agreements |
| Typical investor | PE, strategic buyer, lender consortium |
Deal financing must be reviewed alongside merger and business transfer rules under the Commercial Act (상법 제374조, 제522조).
Corporate Finance Advisory | Term Sheet to Definitive Agreement
A term sheet captures the commercial intent, but it is rarely enforceable in full and often omits mechanics that only surface once the definitive agreement is drafted. Reviewing this gap early prevents renegotiation fights later.
Valuation and anti-dilution mechanics
Pre-money and post-money valuation figures need to be tied precisely to a fully diluted share count, including any option pool top-up, or the founder's actual dilution can differ significantly from what the term sheet implied. Full-ratchet versus weighted-average anti-dilution clauses also produce very different outcomes in a down round.
Liquidation preference stacking
When multiple investment rounds exist, the order and multiple of liquidation preferences determine who gets paid first and how much on an exit or dissolution. Participating preferred structures can leave common shareholders, including founders, with far less than expected even in a profitable exit.
Drag-along and tag-along rights
These provisions determine whether a majority investor can force a sale that binds minority shareholders (drag-along) or whether minority shareholders can join a sale on the same terms (tag-along). Their scope and trigger thresholds are frequently negotiated points in shareholders' agreements.
Corporate Finance Advisory | Covenants, Security, and Default Remedies
Loan and bond documentation is where financing risk is actually allocated. The negotiated covenants and remedies determine how much operational flexibility the company retains and what happens if performance falls short.
Financial and negative covenants
Financial covenants (e.g., debt-to-equity ratio, minimum EBITDA) and negative covenants (restrictions on additional borrowing, asset disposal, dividend payment) can constrain a company's ordinary business decisions for the life of the facility. A breach can trigger cross-default clauses across unrelated facilities, so covenant headroom should be modeled against realistic business projections, not best-case ones.
Security interests and perfection
Security over shares, receivables, or inventory must be properly perfected to be effective against third parties in insolvency, typically through registration or possession depending on the asset type (민법 제349조, 동산·채권 등의 담보에 관한 법률). An unperfected security interest can leave a lender effectively unsecured if the borrower later becomes insolvent.
Regulatory approvals and disclosure
Certain financings trigger reporting or approval obligations, such as large shareholding reports for listed company investments (자본시장과 금융투자업에 관한 법률 제147조) or foreign investment notification requirements. Missing a required filing can delay closing or expose the parties to administrative sanctions after the fact.
Corporate Finance Advisory | From Initial Review to Closing
We review the term sheet, cap table, and any prior financing agreements to understand the deal structure and identify issues before drafting begins.
Based on the company's stage, tax position, and control priorities, we advise on which instrument (equity, convertible bond, loan) best fits the commercial goal.
We draft or review the investment agreement, shareholders' agreement, loan agreement, or security documents and negotiate terms with the counterparty's counsel.
We identify required board or shareholder resolutions under the Commercial Act and any regulatory filings, and coordinate their timing with the closing schedule.
We support the closing mechanics (fund transfer, share issuance, security registration) and advise on ongoing covenant compliance and reporting obligations.
Corporate Finance Advisory | How Fees Are Calculated
For ongoing structuring advice across a deal's lifecycle, fees are typically structured as a fixed retainer scoped to the deal stage (structuring, drafting, negotiation) rather than an hourly open-ended arrangement.
For discrete deliverables such as reviewing a single loan agreement or drafting a shareholders' agreement, fees are set based on document complexity and the number of negotiation rounds expected.
For larger financings or M&A-linked transactions, fees may be partly linked to the transaction size, reflecting the increased scope of due diligence and negotiation involved.
Registration fees, notarization costs, and any regulatory filing fees are billed separately as actual costs incurred, not included in the advisory fee.
※ Costs vary depending on case complexity and specific circumstances; exact fees will be provided during consultation. No specific outcome is guaranteed.
Corporate Finance Advisory | Self-Check Before You Sign
1️⃣ For Companies Raising Capital
- Does the term sheet specify pre-money valuation on a fully diluted basis?
- Have you modeled your actual dilution after the option pool and all prior rounds?
- Do the veto rights requested by the investor cover matters beyond what's standard for this round size?
- Is there a liquidation preference stack, and where does founder equity fall in it?
2️⃣ For Companies Taking on Debt Financing
- Have you stress-tested the financial covenants against a downside business scenario?
- Do you know exactly which assets are pledged as security and how they're perfected?
- Is there a cross-default clause that links this loan to other existing facilities?
- What are the cure periods and notice requirements before a default is declared?
3️⃣ For M&A-Linked Financing
- Does the financing agreement's closing condition match the SPA's closing condition exactly?
- Who bears the risk if financing falls through after signing but before closing?
- Have required board and shareholder resolutions been identified and scheduled?
- Are there any regulatory filings (e.g., large shareholding report) triggered by this deal?
