Business & Corporate Law

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It is not uncommon for ownership to change multiple times soon after the purchase of property. For instance, a group of related companies might have one entity purchase undeveloped property, transfer ownership after purchase to another entity to construct buildings or otherwise develop the property, and transfer ownership again upon completion of construction to a third entity that will manage the property. As another example, one company might buy an office building, and then engage in an immediate sale-leaseback agreement with another entity. There are numerous tax, organizational, and strategic reasons why ownership can change shortly after property is purchased,…
Non-compete agreements are common between employers and employees (“employment covenants”), and between buyers and sellers of businesses (“transaction covenants”). Section 103.465 of the Wisconsin Statutes governs employment covenants and requires employers only require restrictions that are reasonably necessary for the protection of the employer. To quote from the statute, “Any covenant . . . , imposing an unreasonable restraint is illegal, void and unenforceable even as to any part of the covenant or performance that would be a reasonable restraint.” Courts scrutinize employment covenants closely because employers typically have a bargaining advantage over employees when negotiating such contracts, and the…
As we approach the end of 2021, there are important questions business owners should consider before the year is over. One such question is whether now is the time to transfer business ownership by gift, sale, or a combination of both. Due to recent changes in our country’s political landscape, there has been a lot of buzz about potential upcoming changes to the tax code. For example, there could be increases for income taxes, gift taxes, and estate taxes in the near future. It is possible that tax changes could still occur in 2021, although most practitioners suspect the earliest…
The COVID-19 pandemic has forced many businesses to adapt to a remote work environment, creating challenges for the use of traditional transaction formats, such as paper contracts. Although pen-and-paper contracts are hardly extinct, the pandemic has accelerated the evolution toward electronic-only business transactions. Businesses and business lawyers must therefore develop practices and procedures to navigate this new virtual world. This article discusses the laws that apply to electronic records and signatures, the challenges they create, and best practices to follow. Applicable Laws There are two primary laws that govern the legal landscape for electronic records and signatures: the Federal Electronic…
Divisive mergers have been around since Texas adopted a divisive merger statute in 2006. Texas’s law allows a variety of business entities organized in Texas, including limited liability companies, limited partnerships and corporations (a Dividing Company) to divide into two or more entities (a Division Company), and to allocate the assets, liabilities, rights, and duties of the Dividing Company among the Division Companies. Jim Phillips,, Iowa 1979, is a shareholder in the Milwaukee office of Godfrey & Kahn, S.C., where he practices in tax, corporate, and international matters. Since that time, a few other states, including Delaware in…
Wisconsin summers invite many enjoyable activities: boating, hiking, fishing, and of course, trips to the family cabin. A hallmark of Wisconsin’s Northwoods, the family cabin, is a treasured piece of Wisconsin culture. Its foundation tells the story of a family’s hard work, close bond, and dedication. Families gather, laughter is shared, and memories are made. It is no surprise that the cabin is often a family’s most valuable asset. As such, protecting it from devastating long-term care costs requires special attention and advance planning. Considering the unique nature of family-owned real estate like cabins and farms, a family LLC may…
In connection with ExxonMobil’s annual meeting held on May 26, 2021, three dissident directors nominated by hedge fund Engine No. 1 were elected to ExxonMobil’s board, beating out the incumbents. Engine No. 1 had proposed the director nominees (along with one other) to help lead ExxonMobil to long-term shareholder value creation, including through “net-zero emissions energy sources and clean energy infrastructure.”1 The fact that these dissident directors won the election over the incumbents indicates the increasingly broad shareholder support for clean energy to reduce climate change. Momentum Builds for ESG ExxonMobil is not alone in facing an investor challenge…
Time flies when you’re having fun. In November & December 2018, I wrote a series of posts about ownership dilution in the context of startup fundraising – it seems like it was yesterday – but apparently it was more than two years ago! If you’re interested in checking out those posts, they’re available here and here. In the intervening time, dilution has continued to regularly come up as a point of confusion among new founders and entrepreneurs. In addition to the posts linked above, here are some updated things to keep in mind with regard to dilution: Dilution is…
By:  Attorney Andrew J. Steimle Just about every business in the United States was impacted by the COVID-19 pandemic.  But the world did not stop, and neither did business transactions.  This article is intended to provide you with some additional items to consider when buying a business as we start to come out of the pandemic. First and foremost, doing thorough due diligence has never been more important.  The impact the pandemic had on companies ranges from severe distress to record setting profits.  A key component of post-pandemic due diligence is that every buyer must be able to understand not…
Leverage. Maintaining superior leverage in an M&A transaction allows a buyer or seller to gain an advantage when negotiating terms of the transaction. If you don’t have it, it can cost you tens, hundreds, thousands or millions of dollars, depending on the size of the transaction. Buyers may gain leverage in a transaction during due diligence when the seller has not done its own due diligence prior to delivering requested business information to the buyer. In order to avoid giving up leverage, a seller should conduct internal due diligence well before the business is marketed for sale. From a seller’s…
One of my favorite things to do is help someone buy or sell a business.  It is often either the grand finale for the owner of a successful company or the beginning of one for new owners.  No matter if I am representing the buyer or the seller, it is exciting.  Also, regardless of who I am representing, I ask: Is this a stock or asset sale? And I usually receive the same response.  Some eye blinks, an “uh….”, and then, “I’m not sure. Is there a difference?”  My response is always the same: “No problem, but that is the…
The American Rescue Plan Act of 2021, signed into law on March 11, 2021, established the Restaurant Revitalization Fund (RRF). The RRF earmarks $28.6 billion in grants to restaurants, bars, breweries, wineries, distilleries, caterers, food trucks and similar businesses. The Small Business Administration (SBA) will administer the RRF and provide the grants, which are intended to cover a business’s total pandemic-related revenue losses. Timing Be ready to act fast: The SBA will generally award grants to eligible entities in the order that applications are received. Like the first round of the Paycheck Protection Program (PPP), there is expected to be…
With the new Biden Administration’s trade policy taking shape, one area of significant importance for businesses to pay attention to is the administration’s stated goal of pursuing a “human rights” focused foreign policy. This is of particular importance, because U.S. foreign policy goals often drive U.S. trade policy, and a human rights-centered foreign policy signals an intensifying of trade measures against entities, individuals, business sectors, and countries that the U.S. government believe are acting against U.S. foreign policy goals. One such area that will likely see an increased scrutiny by the U.S. government are transactions that could be deemed to…
As many lawyers with business clients are aware, laws applicable to the protection of personally identifiable information (PII) seem like large, gray clouds hanging over customer and business transactions – both ominous and yet undefined. Given the changes associated with the protection of PII, the question becomes how best to comply. But an even more preliminary question each firm should ask – in actuality, should deeply assess – is what information does it need to keep in its systems on its customers? Why over What The bare fact of the matter is that the less data a firm has in…
On February 25, 2021, Governor Evers signed 2021 Wisconsin Act 4, which became effective as of February 27, 2021.  In general, the new law takes a step toward modernizing Wisconsin’s unemployment system after more than a decade with no upgrades. In addition, the legislature took the opportunity to attach language as it relates to immunity for civil liability for COVID-19 exposure. The immunity-related language reflects compromises that were struck between the Evers administration and the legislature. Included in the new legislation is limited liability protection for businesses, schools, and churches when someone has been exposed to and contracted COVID-19. Now,…
Farmers know there’s going to come a day when they’re no longer around to run their farms – and they know they should have plans in place for when that day comes. But farmers often delay planning because it forces them to think about difficult topics and make difficult decisions. The first step to beginning a succession plan is to pull together a team to help build and implement a plan. The team should consist of trusted professional advisers, successors who will continue the farming legacy and other family members to help make those difficult decisions. Having a strong team…