New York Corporate & Securities Law Blog

When is a business deal 'love at first sight?'

Some may say that love at first sight is merely a myth, something to get people to buy expensive gifts for their crushes or to pursue an impromptu relationship. But who says that love at first sight is only limited to just people?

According to a recent abcnews.com report, the recent purchase of grocery retailer Whole Foods by online retailer Amazon.com was a “whirlwind courtship” and “love at first sight.” Whole Foods CEO John Mackey described the deal as such after the $13.7 billion deal was announced. By making the purchase, Amazon seeks to make significant changes in the way consumer purchase their groceries now and in the future. 

How SEC regulations can affect your crowdfunding plans

As the reach of the Internet connects more people to each other, crowdfunding has become a popular model for startup companies to generate money for inception costs. Until recently, supporters would receive small tokens for their generosity, such as t-shirts and hats to even small parts in movies.

Now crowdfunding has evolved into securities offerings where supporters receive monetary benefits for their contributions. This means that these and future gifts through crowdfunding could be governed by SEC regulations. 

Trends that could affect businesses through 2017 and beyond

Indeed, we do not regularly discuss politics or political actions on this blog, but it is naïve to believe that politics does not influence business trend. Being knowledgeable about political trends can help businesses make important decisions that could affect them for years to come.

With the winds of political change currently blowing, we would be remiss if we did not identify a few possible trends that may shape how businesses operate in the second half of 2017, or for the next few years. 

Coach and Kate Spade agree to major merger

Major mergers and acquisitions have not made very many headlines this year, but the luxury handbag market is about to experience a shakeup of major proportions. Coach announced that it will buy Kate Spade in a $2.4 billion deal.

According to a recent cnnmoney.com report, the famous luxury handbag maker will buy its major competitor in a deal that is expected to boost Coach’s profitability. The company hopes to generate $50 million in savings each year by combining Kate Spade’s and Coach’s inventory management and supply chains. Further, both companies hope to expand their international presence, even though a majority of their sales originate in the U.S.

Essential steps for startup businesses

Launching a startup business may raise the same feelings as jumping out of an airplane. The feeling can be exhilarating, yet it may be very dangerous. After all, if your chute doesn’t deploy, you won’t live to tell about it. Indeed, starting a business may not put your life in danger, but failing in a startup could have life altering implications.

So no matter how genuine an idea you believe you have, there are a number of things you should take very seriously. This post will highlight a few. 

What to do with trade secrets in a lawsuit

Most business owners don’t want to imagine this scenario, but what happens when an employee leaves the company with unauthorized trade secrets and uses them (or is about to use them) to benefit themselves or another company? Indeed, you would want to prevent the disclosure (or use) of such information as quickly as possible by taking swift action in court.

But before you obtain a temporary injunction, you may be required to disclose to the court the secrets you are trying to protect. After all, federal law requires plaintiffs to disclose them with “a reasonable degree of specificity and precision” in order to properly separate them from other terms that can be disclosed.  How can this be done without bearing important secrets?

Things to consider when you’ve never started a business before

There are a lot of things to consider when starting a business and perhaps if you have started businesses before, these issues are just things to check off your checklist. But for many individuals, the business they are investing time into could be their first. It may be a side project that is growing but they do not quite know how to make it a full-fledged business.

If you’re at that starting point, you may want to consider some basic tips that could really go a long way in making your dream a reality.

Should you have a litigation 'war chest'?

It is common for businesses of all sizes to be mindful of the constant threat of litigation. Unfortunately, we live in a litigious society, so the specter of being dragged into a lawsuit is a legitimate concern. As the old adage goes, the more time you spend litigating a matter, the less time you spend making money. Because of that alone, litigation should be viewed as a last resort.

Nevertheless, lawsuits are an unfortunate part of doing business. It is not uncommon to have suits that are based on questionable legal grounds or threatened with ridiculous demands. Some may bring these suits based on the assumption that you would rather settle for a fraction of the amount demanded, since litigating the dispute (and prevailing) will cost just as much as paying the demand up front.

Attributes of a well-drafted buy-sell agreement

Although many baby boomers are opting to remain working upon reaching retirement age, there are certain considerations that business owners should make to ensure their companies remain viable in the future. Planning for contingencies does not need to be tied to an exit strategy; however, those who are prudent will develop strategies for addressing situations that have not yet appeared on the horizon.

It is for this reason that business owners look to buy-sell agreements. While this contract can create a path toward retirement by incorporating a succession plan, it can also be used to establish a course of action should a life-changing event take place. According to Rachel Flaskey, senior manager in Baker Tilley, the buy-sell agreement should be seen as "a business continuity tool" to lessen disruption caused by divorce, disease, disability or death.

Accelerator alignment: Getting the most out of startup support

"Eight of 10 businesses fail within the first 18 months."

"50 percent of all new businesses make it to their fifth year."

Whether it appears in Fortune or a report from the US Bureau of Labor Statistics, the data these sources reveal regarding the average lifespan of a startup is often contradictory. The statistics may be hazy; however, the reasons for a fledgling business's untimely demise are concrete: limited capital, loss of market interest or lack of quality mentoring.

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