Sher Garner Cahill Richter Klein & Hilbert, L.L.C.

Trials & Transactions

2021-12-10T20:25:43Z

Forthcoming Proposed Regulations Will Allow SALT Work-Around by Allowing Income Taxes Imposed on Partnership or S Corporation as a Deduction in Calculating the Entity’s Non-Separately Stated Taxable Income or Loss In Notice 2020-75, the IRS announced that forthcoming proposed regulations will clarify that State and local income taxes imposed on and paid by an S Corporation or a partnership are allowed as a deduction by the entity in computing its non-separately stated taxable income or loss for the taxable year of payment. Read More..

What is an escalation clause?

2020-11-11T14:26:05Z

When scouting for new business premises to lease, you may find the terms used in the rental contract somewhat confusing. Misunderstanding them could leave you open to unexpected costs. One thing many business owners miss when signing leases are escalation clauses. These allow a landlord to increase your rent in the future. There are valid reasons for escalation clauses. They protect commercial property owners from losing money or potential profit when signing long-term leases. Property values in an area may increase. A landlord would feel aggrieved if tied into a contract where they receive only half of what they could. Costs can go up too. If you sign a full-service contract, the property owner needs to cover increased wages for staff such as cleaners, security and reception, if the minimum wage rises. If your company consists solely of people working on laptops, a long-term lease may be less important. However, if you own a restaurant or other business that relies on customers knowing where you are, consistency of location is everything. Fitting out a place also takes time and money. Before signing a long-term lease that includes an escalation clause, you need to ensure it is not overly advantageous to the landlord. If you can determine a fixed increase, it allows you to plan your finances. However, many landlords prefer variable escalation. Try to limit the frequency and percentage increase allowed and tie it to something, such as inflation, rather than being at the landlord's whim. Tying your business into an unfavorable lease contract could be an error that is hard to escape and difficult to recover from. Before signing a commercial lease, have the contract checked by an experienced attorney.

The benefits of creating a non-compete clause

2020-10-22T16:03:06Z

It’s a competitive marketplace, and the success or failure of a business often comes down to how well they protect their confidential information. One tool business owners have at their disposal is a non-compete clause. A properly drafted and enforceable non-compete clause can help ensure ethical business operations and reduce the threat of unfair competition.

Protecting the disclosure of privileged information

Your company likely invests a lot in training your employees. Over time, your employees will probably have access to several types of confidential information concerning your business practices. Trade secrets are vital to the success of any company. The last thing you want is for your employees to take a job at a competitor with your trade secrets in hand. A non-compete agreement can prohibit employees from working with a competitor immediately after leaving your company. They can also be used to prevent an employee from opening a business of their own with the competitive edge provided by your trade secrets.

Stopping unfair competition

Another advantage of a non-compete agreement is that they can prevent a business owner from soliciting customers from a company that they just sold. You can tailor the agreement to prevent the previous owner from opening up shop within a certain distance of your company. You can also craft an agreement that prevents the previous owner from opening a business within a specific time frame.

Ensure the agreement is enforceable

Non-compete agreements have been the subject of much litigation in recent years. Some states have even gone so far as to ban their use altogether. It’s important for you to ensure that your non-compete agreement is enforceable. One way you may do so is to limit its scope. It’s probably not necessary for every single employee on your payroll to sign a non-compete agreement. Given enforceability issues and the surrounding history of litigation, you should work with a skilled professional if you’re considering drafting a non-compete agreement. A business law attorney can help you protect your interests.

How can an attorney help during the sale of your business?

2020-10-22T16:01:47Z

As a business owner, you know how many details are involved in any transaction. When that transaction is the sale of your business, the sale process can become even more complex. Working with advisors—including a financial advisor and attorney—can help the sale of your business go more smoothly. How can an attorney help you during the sale of your business?

An attorney can help ensure that your business is ready to sell.

Working with an attorney early in the sale process ensures that your business has prepared for the sale. Your buyer will perform a due diligence review of your documents, and attorney review can help ensure that those documents are complete, up-to-date and ready for the sale. As Forbes notes, this process should start as early as possible to ensure that you have time to resolve any potential issues before they become a concern for the buyer.

Careful contract drafting and negotiation helps protect you from future concerns.

Not only can your attorney help you negotiate the specific terms of your contract, they can help you craft the terms of your contract to protect you from future legal issues. This can help you better achieve your long-term goals after this sale.

Legal counsel can help make the closing process more straightforward.

Because they have a great deal of familiarity with the process of selling a business, an attorney can ensure that your documentation is in order and that you receive the money you need. They can also ensure that any additional documents necessary for the sale have been completed, including the transfer of intellectual property, any necessary non-compete agreements and relevant tax forms. By working with an experienced attorney, you can sell your business with confidence and create a strong foundation for new opportunities in the future.

Welcome To Our Blog

2019-12-03T15:41:16Z

We established this blog to share stories and information about topics relevant to our practice. Our intent is to regularly provide posts highlighting legal issues of local, state and national interest that we think you will find interesting. Check back later for updates.