M&As – Novation and Recertification
The Internal Revenue Service’s new private letter ruling (PLR) concerned a domestication of a Foreign Parent corporation under U.S. ownership—with a few notable twists. First, the PLR applied a substance-over-form analysis to...more
The U.S. Department of Justice ("DOJ") won at trial in its first insider trading prosecution against an executive based exclusively on his sales of stock under 10b5-1 trading plans....more
Business owners considering exit options from their businesses often can be blinded by purchase price figures and proceeds, often “accepting” that paying capital gains tax is part of the deal. The ability to avoid or defer...more
Would you be surprised to learn that most shareholders of closely held corporations, and especially those with minority or merely passive interests, believe they cannot be held responsible for the tax obligations of their...more
Section 1202 provides a significant incentive for taxpayers to invest in small businesses structured as C corporations by allowing them to exclude large amounts of gain on a future sale of stock in those businesses. ...more
There are two primary ways to structure the taxable purchase and sale of an incorporated business. The parties may engage in an asset acquisition, in which the buyer purchases assets directly from the target corporation....more
What happened? The U.S. District Court for D.C. recently rejected a motion to dismiss a lawsuit claiming fraud in an alleged “pump and dump scheme” arising out of...more
If you are a business owner contemplating the sale of your business, or an individual considering entrepreneurship through acquisition, you may be wondering “what are the steps in a purchase and sale of a business?”...more
The Coster v. UIP Companies, Inc. decision provides a framework for evaluating stockholder disenfranchisement claims. Directors should carefully consider how, and under what conditions, they will take actions that dilute...more
The Internal Revenue Service (IRS) can file a lien and levy on any and all of a taxpayer's property (and rights to property) regardless of how the property is held or titled. 26 U.S.C. § 6321. Whether the item is a taxpayer's...more
Despite being one of the more well-known doctrines in corporate law, the rule articulated in Blasius—that directors who act with the primary purpose of interfering with a stockholder vote must have a compelling justification...more
On Father’s Day, Morgan Bux celebrated with her dad Big Daddy Bux and asked him to team up with her to buy the fast-growing Green Earth Air Conditioning and Heating, LLC in Buda from the Green Earth retiring owner Gaia....more
An asset sale is the purchase of individual assets and liabilities. A stock sale is the purchase of the owner’s shares in a corporation / membership interest in a limited liability company. Potential legal liabilities and tax...more
More and more buyers are using representation and warranty insurance (RWI) to supplement or replace indemnities from a seller in the sale of a business in Canada. While some of our clients, particularly private equity funds,...more
Some rare last-minute SEC intervention forced Hertz to suspend its planned sale of up to $500 million in shares of the bankrupt car-rental company while the agency undertakes a closer review of the offering....more
The current market environment and unprecedented volatility during the COVID-19 pandemic has created novel issues, and in some cases opportunities, for public companies and individuals regarding securities trading. The below...more
A promise of “unlimited” QE from the Fed Monday morning briefly turned the tides on Dow futures but wasn’t enough to overcome another day of COVID-19-related fears and DC gridlock over the $1.8 trillion stimulus package III...more
In April 2019, the IRS’s Large Business and International Division (LB&I) issued an LB&I Transaction Unit (LTU) that described potential positions a taxpayer may take to recover previously capitalized transaction costs....more
UK regulators are probing ties between disgraced financier Jeffrey Epstein and Barclays CEO Jes Staley. The bank’s board is so far standing 100% with Staley, who has expressed “regret” over his relationship with Epstein....more
Volvo’s owner, Li Shufu, is mulling over a move to combine the carmaker with his publicly traded Geely Automobile Holdings—a play that would take Volvo public and “unify the bulk of billionaire Li’s growing stable of...more
A recent Technical Advice Memorandum (TAM) issued by the Internal Revenue Service (IRS) National Office concludes that a target company required under Internal Revenue Code Section 263(a) regulations to capitalize costs that...more
Two years after the enactment of the Tax Cuts and Jobs Act (TCJA), the most significant tax reform enacted in a generation, taxpayers continue to encounter substantial uncertainty arising from interpretations of new statutory...more
T-Mobile chief and fan-of-magenta John Legere has announced that he’ll be stepping down in April at the end of his current contract. Legere will be succeeded by Mike Sievert, the carrier’s current president and COO....more
Some interesting links we found across the web this week: Back Channels in the Boardroom - After a board meeting, it is common for board members to begin side conversations with each other. While these side...more
If you are looking to sell shares in your company to the State of California, you might want to reconsider. Article XVI, Section 17 of the California Constitution expressly forbids the state from subscribing to, or being...more