LOIs – Common Mistakes

A letter of intent or LOI is a document that’s often used to outline the preliminary understanding between parties before entering into a formal contract or agreement. Below, I outline the common mistakes in LOIs and how to avoid them. Parties should address these common mistakes and taking proactive steps to draft clear, comprehensive, and … Read more

Using AI to Manage the Corporate Transparency Act

The use of AI can provide significant benefits for the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) in managing the Corporate Transparency Act (CTA). However, there are potential dangers and risks that need to be carefully addressed. AI models can perpetuate or amplify existing biases in the training data, leading to discriminatory outcomes or … Read more

Corporate Transparency Act – Enforceable?

A Federal District Court in Alabama just issued a decision finding the Corporate Transparency Act (CTA) unconstitutional in the case of National Small Business United v. Yellen. The court ruled that in enacting the CTA, Congress exceeded its Constitutional powers, including its authority to regulate interstate commerce. Specifically, the court agreed with plaintiffs that while … Read more

AI: Automating M&A Document Review

AI can automate various aspects of the due diligence process, such as document review, redlining, and contract summarization. By automating routine tasks, AI frees up M&A professionals to focus on higher-value activities, such as strategic analysis and negotiation. I give more particulars below after the video. By automating routine tasks and leveraging AI-driven analytics, M&A … Read more

Forming an LLC? Why not an S Corp?

Founders may form many types of entities, including partnerships and regular corporations (C Corps), but two of the most popular types are limited liability companies (LLCs) and Subchapter S corporations (S Corps). Generally speaking, LLCs and S Corps are entities that allow profits and losses to be passed through to the owners of the entity, … Read more

Starting a 501(c)(4) Organization

It’s Not a 501(c)(3) A 501(c)(4) organization is an organization not organized for profit and operated exclusively to promote social welfare. 501(c)(3) and 501(c)(4) organizations are different. 501(c)(3) organizations are organized for charitable purposes; 501(c)(4) for social welfare purposes Both types of organizations are exempt from federal taxes, but only the 501(c)(3) organizations may receive … Read more

What the …? I’m Selling Securities?!

You have a new business or you’re thinking about expanding your existing business. And you think it would be great to offer some shares or membership interest in your company to an outside investor. Nothing could be easier. Right? Wrong! You may be selling securities and will need to comply with federal and state securities … Read more

Dropping the Use of LLC and Inc.

Your business is organized as a limited liability company, corporation or other entity. Its legal name includes a suffix such as ‘Inc.’ or ‘LLC’. However for marketing or other purposes, you wish to use the name without the suffix. A problem? Yes. Background Individuals, acting by themselves or with a group, are generally responsible for … Read more

Buying a Book of Business

Outside of a dog, a book is man’s best friend. Groucho Marx Your business is doing well. So well, that you’re thinking it’s time to expand. One possibility is to slowly continue to build the business by adding customers or clients one at a time. Another possibility is to quickly add new customers or clients by … Read more

Checklist of Buy/Sell Considerations

No two deals are alike. However, it’s useful to at least think about the following items when shaping and negotiating a deal. 1. Finding the buyer or seller    a. Networking, professional and social    b. Competitors    c. Business brokers    d. Investment bankers2. Useful professionals    a. Lawyer    b. Accountant    c. Investment banker    d. Tax advisor3. Before serious negotiations and discussions begin, consider    a. Entering into a confidentiality … Read more

A Simple DIY Guide to Starting Up an LLC

Please note the “simple” in the title. Look, I know that you want to save money and do it yourself. But this may be penny-wise and pound-foolish; there are nuances and details you may miss. Think about engaging a lawyer. There are lots of different types of entities and lots of different states. We’re going … Read more

Business Succession

You may have heard of this guy who used to live in my town Montclair, Yogi Berra. Yogi’s famously known for his words of wisdom, including: “You’ve got to be careful if you don’t know where you’re going, because you might get there.” Every business, new and old, needs to know where it’s going. Businesses … Read more

Is Your Operating Agreement Complete?

You and your partners are successfully running your business. After talking to your accountants and lawyers – I am always hopeful – you decided to operate your business as a limited liability company and entered into an LLC operating agreement. This operating agreement governs your relative rights and obligations. I’m fairly certain that your operating … Read more