Control of a Set-aside Entity
Owners of closely held businesses, particularly first-generation owners, often have a difficult time finding a suitable succession plan. These owners are faced not only with phasing out of their labor of love, but choosing a...more
Since their establishment in 1974, Employee Stock Ownership Plans (“ESOPs”) have become a popular and effective mechanism for private companies (both C corporations and S corporations) to provide employees an opportunity to...more
Following up on our first blog post about employee stock ownership plans (ESOPs) for construction companies, this post addresses surety bond requirements as well as the way in which ESOPs can incentivize employees and...more
The Financing for the Future Act came into force on 15 December 2023. The significant reforms to stock corporation and capital market law increase flexibility in German ECM transactions. Overview of the key changes - ...more
Wichtiger Hinweis: Die folgenden (rechtlichen) Ausführungen dienen nur der allgemeinen Information, sind nicht abschließend und stellen keine rechtliche, steuerrechtliche oder sonstige Beratung dar. ...more
October is Employee Ownership Month. Employee ownership can take many forms, from 100% employee ownership through an ESOP or a cooperative to synthetic equity plans where no actual equity is sold, but employees participate...more
Check out our summary of significant Internal Revenue Service (IRS) guidance and relevant tax matters for the week of August 7, 2023 – August 11, 2023....more
It’s Complicated- The Code includes a number of complex rules that are aimed at those overseas business and investment activities of U.S. taxpayers that Congress has determined may result in the improper deferral or...more
The Delaware Supreme Court recently affirmed the Delaware Court of Chancery’s 2022 post-trial decision that Tesla’s 2016 all-stock acquisition of SolarCity Corp. satisfied the entire fairness standard of review, and thus did...more
Estate Tax – It’s a Killer- One of the reasons often given for eliminating the estate tax is the substantial economic burden it places upon the estate of a deceased business owner and upon the business itself. Specifically,...more
Harris v. Harris, C.A. No. 2019-0736-JTL (Del. Ch. Jan. 6, 2023) - Delaware law allows for two exceptions to the continuous stock ownership rule for stockholders to bring and maintain standing to assert derivative claims...more
1. The National Labor Relations Board reinstated its previous standard for restricting employee severance agreements. McLaren Macomb, 372 NLRB No. 58 (2023). The Board’s ruling applies to all severance agreements for...more
In re Stream TV Networks, Inc. Omnibus Agreement Litig., C.A. No. 2020-0776-JTL (Del. Ch. Oct. 3, 2022) - Court of Chancery Rule 70 speaks to the Court’s discretion in fashioning sanctions for failure to comply with a...more
Recently, the Department of Defense (“DoD”) issued a memorandum to launch a pilot program that will enable certain contractors owned under an employee stock ownership plan (“ESOP”) to receive sole source follow-on awards....more
A Canadian company adopting a deferred share unit plan (DSU plan) for its directors must consider U.S. tax implications for U.S. taxpayers. It is important to remember that U.S. citizens and U.S. residents for tax purposes...more
On June 23, in Centripetal Networks, Inc. v. Cisco Systems Inc., the Federal Circuit vacated judgment of the district court because stock held by the judge’s wife violated the recusal statute and was not harmless error. The...more
On May 5, 2022, McDermott Partner Allison Wilkerson delivered a presentation during the 2022 TEA National Conference titled “Mature ESOPs: Remodeling the House You Own.” Her presentation focused on the traits of a sustainable...more
In what seems like one of the speediest transaction processes ever for a deal of its size, Twitter agreed on April 25, 2022 to be acquired by Elon Musk for $54.20 per share or about $44 billion. It all started with Musk...more
On February 18, 2022, the US Senate unanimously passed the Courthouse Ethics and Transparency Act, which requires all US federal judges to publish their financial disclosure reports to the public. This legislation closely...more
For over 20 years, Congress has provided powerful incentives for S corporations to sponsor employee stock ownership plans (“ESOPs”) through the tax code provisions that exempt all of the income of a 100% ESOP-owned S...more
The Fourth Circuit Court of Appeals has provided relief to a defendant who sold shares of company stock to an employee stock ownership plan (“ESOP”) by rejecting the district court’s legal conclusion concerning the...more
Applying Ohio law, the United States Court of Appeals for the Sixth Circuit has concluded that an ERISA exclusion in a professional services liability insurance policy barred coverage for all ERISA-related Claims made against...more
On 15 November 2021, decree No. 2021-1443 of 27 October 2021 (hereinafter the "New PPP Decree"), implementing law No. 2021-23 of 2 March 2021 on public-private partnership contracts (hereinafter the "New PPP Law") was...more
Shareholder activism has been a significant phenomenon amongst the largest U.S. public companies, with activists of a variety of stripes waging campaigns on a wide range of issues. As such activism has continued to grow, it...more
If ever there was a ticking time bomb of a family-owned, closely held business more likely to result in business divorce litigation than the one in Matter of Brady v Brady, 2021 NY Slip Op 02705 [4th Dept Apr. 30, 2021], I...more