William A. Price, Attorney at Law
Owners of part of a business who guarantee auto or other asset loans for the company do not get title to the asset for which the loan is made. They may or may not even get credit for a capital contribution to the company, depending on the internal organizational agreements (partnership agreement for a partnership,…
There are two times that business partners argue: when they have money, and when they don’t. Those alternatives cover all available time segments, so if you’re advising people on how they should organize their business, some rules for the arguments may be in order. The classic horror story about such arguments is the Illinois appellate…
Just met with a potential client who wanted advice on whether to form an S corporation “to do everything legally required” for a new business. He wants to export clothing, cars, and food to Africa. I reminded him about the tax benefits (no Social Security/Medicaid taxes on S distributions) and disadvantages (franchise taxes) of sub…
A recent Stanford study of P/e (private equity) owned company CEO compensation across 144 sample firms found the following: “To summarize the key results in this section, we find that, relative to public corporations, on average, PE-owned firms: (i) provide the CEO with 2.3 percentage points more equity (that is, nearly twice as much equity as…
The Illinois General Assembly House and Senate passed SB 1098, which contained two sets of provisions originally drafted by the Institute for Illinois Business Law. The first set allows reinstatement within three years after entity dissolution without personal liability for intervening acts by officers and directors continuing the business of the dissolved entity. The second amends…
Some interesting statistics: There were over 67,000 angel deals in 2013: See http://tinyurl.com/lkoarqz There have been more than 9,200 SBA backed startup loans in 2014. See http://tinyurl.com/mg6plg8
Both S corporations and limited liability companies (LLC’s) are generally similarly treated in Illinois for liability and tax purposes, particularly if an S corporation election is in effect for the LLC. Internal organization statutes are different. What is similar is that there is liability limitation to investment in either type of entity, similar veil piercing doctrines, an…
The US Securities and Exchange Commission posts names and details of those it has named in enforcement actions under the insider trading laws. These prohibit the purchase or sale of a security in breach of a fiduciary duty or other relationship of trust and confidence while in possession of material, nonpublic information. Actions in 2014…
Many merger deal cleanups involve leased real estate. Just posted a SlideShare article titled “Landlord and Tenant Obligations”, originally prepared for Sterling Educational Services (though I retain the copyright). Their seminar was cancelled, but you can still get the benefit of the material by downloading the talk. It is available for free at http://www.slideshare.net/wpriceiit/landlord-and-tenant-obligations
In InsureOne Indep. Ins. Agency, LLC v. Hallberg, 2012 IL App (1st) 92385, http://www.state.il.us/court/Opinions/AppellateCourt/2012/1stDistrict/1092385.pdf (Ill. App., 2012), the court held that a failure to pay approximately 2% of an earn-out, which was 1% or less of the agreed purchase price, was not enough to cancel a seller and his son’s noncompete obligations under the asset…