Although the majority of the transactions I advise on can be described as additive – one company acquiring another one, a company selling newly-issued stock to a new investor – I do spend some time on subtractive (is that a word?) matters, including business divorces. In its simplest form, this term refers to a decision of two business partners to wind down a business, often because some tension has developed in the relationship, just like a personal divorce.

As a purely transactional lawyer, I would only get involved in a business divorce if the parties want to resolve it amicably, without bringing a claim in court, though it can be useful to get the parties moving toward a solution to raise the specter of litigation and its associated costs and delay. In the world of family law, there are attorneys who specialize in collaborative or cooperative divorces, and I try to play a similar role in business divorces by encouraging compromise, even though I’m clearly representing one side and looking out for that party’s interests. Any effort to achieve total victory in these situations is likely a fool’s errand, or at least a very stressful and expensive errand.

In some business divorce cases, the company’s operating agreement or other governing document sets forth an exit procedure that the parties follow. For example, a 50/50 agreement may have a so-called “shotgun” buyout provision that allows one party to initiate a buyout process by setting a value for the company, and then the other party has the option to either buy the initiating partner’s interest or sell to the initiating partner, in either case at the price set forth in the initiating partner’s notice.

If the parties are not following a particular pre-determined procedure, just mutually agreeing to wind down the business, then the parties likely need to draft a dissolution agreement, or similarly-titled document, that details the steps the parties need to take in the wind down. Especially in high-tension situations, the parties will want to exchange mutual releases of claims based on past events, though they would retain the ability to sue based on future actions to be taken under the new agreement, and a mutual non-disparagement clause, so the parties can move on in their respective professional lives without worry about their reputation being sullied by the ex-partner.

My son is graduating college this spring, and he will then start work at a law firm in New York as a paralegal, to give him an opportunity to see law in action and decide whether he wants to apply to law school. My wife and I have been aggressively neutral as far as trying to shape our children’s career choices. We’ve been careful not to push them into law, but we’re not discouraging it either.

In talking to other parents over the years, some are neutral like me, but a significant number who are themselves lawyers say they strongly discourage their children from entering the law. I can’t think of anyone I know at the other extreme, who affirmatively try to push their children into a legal career, which is a contrast to the more intrusive parental approach of many years ago. (Though I should point out that when I was growing up, my trial lawyer father and novelist mother took a neutral and supportive role as I now have.)

Lawyers: Would You Encourage Your Children to Become Lawyers?Read More »

There are those who are addicted to the new online word game, Wordle, and then there are those who gripe about their friends who post their Wordle scores on social media every day. This being a blog about corporate and securities law and transactions, I am not writing to opine on this question, though the fact that I’m mentioning the game at all probably tells you where I stand.

The New York Times recently agreed to acquire Wordle from its Brooklyn-based creator, Josh Wardle, as reported by the, well, New York Times. According to the newspaper/acquiror, the purchase price is “in the low seven figures.” I’m not sure whether that means a million-ish or some amount that is less than $5 million, but in any event, it is a nice payday for Mr. Wardle for a product released just a few months ago.

Thoughts About the Wordle AcquisitionRead More »

The Wall Street Journal reported exclusively on plans by the London Stock Exchange to create a special market for the shares of private companies for limited public trading. The plan itself is not yet public, so the Journal was only able to report on limited aspects of what is contemplated. In the same way that U.S. private companies have increasingly been able to access public-like markets with new exemptions like Regulation CF, Rule 506(c) and Regulation A+ and the development of secondary trading markets for large private companies, this is an effort across the pond to provide some of the benefits of public market access to small and fast-growing companies.

The London Stock Exchange’s Proposal for Private Company TradingRead More »

I can’t claim to have invented remote work, but I can say that I was doing it well before the majority of the workforce was forced into it in early 2020. My firm’s address, since its formation in 2010, has been at 565 Fifth Avenue in midtown Manhattan. For the first several years, I took the Long Island Railroad in every day and worked in my office, like any other lawyer. As the firm evolved, I built a network of freelance attorneys that worked for the firm. Especially given that the first two of them resided in Spain and Alabama, respectively, I was never going to need to provide extra space for the attorneys; accordingly, they worked from wherever they wanted.

After a few years of this, it occurred to me that without any opportunity for literal face-time with my co-workers, it was kind of silly for me to endure the commute on days where I had no meetings with clients or others. So, I set up shop in a spare bedroom at home in Port Washington, LI, and went into the city only when there were meetings. Aside from the occasional unwanted noise during conference calls from dogs or teenagers, it’s worked quite well.

Thoughts on Remote Work from a (Relative) PioneerRead More »