The buyer hires the seller’s owner to be its vice president of sales, under a 5-year employment agreement, with the buyer’s right to terminate for cause. The agreement also gave the buyer the right to fire the seller’s owner at…
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A BADLY DRAFTED EMPLOYMENT AGREEMENT WITH SELLER’S OWNER ENDS UP IN COSTLY LITIGATION BETWEEN THE BUYER OF SELLER’S BUSINESS AND SELLER’S OWNER
Posted in Problem with seller owner's competition, problems with seller's employees Tagged with: Appellate court decision, Buyer-seller disputes, Employment agreement, Employment contract, Employment termination, Litigation costs, M&A litigation, Non-competition covenant, Seller's owner, Termination for cause
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- force majeure
- foreign income tax
- form over substance
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- Guaranty
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- hiring seller's employees
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- note payment amount adjustment
- notice
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- officer duty of care
- offset or setoff provision
- offset right
- One class of stock
- oral contract
- oral copyright agreement
- overly complicated language in contract
- owner liability for company breach of financing deal
- Ownership of Target Law Firm File
- parol evidence rule
- patents
- payroll tax
- percentage of purchase price
- permits and certificates
- personal goodwill
- personal guaranty
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- personal guaranty of lease
- Personal Name
- photo or image
- piercing veil of acquisition subsidiary
- post asset purchase issues
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- post-closing sales tax
- PPP loan
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- pre-closing management agreement
- pre-closing operating arrangement
- pre-closing sales tax
- preservation of due diligence materials
- prior-material-breach doctrine
- private equity
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- Problems when business fails after closing
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- problems with noncompetition covenants
- problems with oral M&A promises
- problems with pensions
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- Problems with post-closing management of business
- Problems with Real Estate Leases
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- problems with seller nondisclosure
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- product line exception
- projections
- projections
- promissory estoppel
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- purchase price
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- purchase price reduction
- quality of earnings assessment
- ratifying unassumed contract by post-closing action
- reasonably equivalent value
- receipt of buyer equity or security
- receipt of buyer equity or security
- receivables
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- reformation
- reformation of contract
- reliance
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- representation and warranty about customers
- representations and warranties
- rescission
- rescission
- restrictive post-closing covenants
- retaliation
- retention bonus
- revenue and profit projections
- reverse termination or breakup fee
- Revlon doctrine
- Right of publicity
- risk of post closing payments
- royalty
- S corporation
- sale leaseback
- sale of assets of business
- sale of business to ESOP
- sale of product line
- sales order
- sales tax
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- sales tax risk
- SBA approval re PPP loan
- scienter
- Section 1377 election
- Section 363 sale
- securing buyer's note
- securing deferred purchase price
- security agreement
- seller carried purchase price
- seller knowledge
- seller owner responsibility for underreported sales tax
- seller owners equity interest in buyer
- seller ownership in buyer
- seller rep of no federal employer liability
- seller's age discrimination claims
- seller's covenants
- seller's federal injunctions
- seller's unemployment experience rating
- seller's warranty claims
- seller's workers compensation experience rating
- Selling shareholders problem with their board of directors
- severance benefits
- sexual harassment
- shareholder approval of deal
- shareholder buyout of partner
- shareholder personal guaranty of target lease
- shareholder release
- sharing transaction tax deduction benefits
- sick time
- signing LOI with revisions by signer
- specific performance
- state and local tax
- state approval of nonprofit hospital
- state franchise/income tax
- statute of frauds
- statute of limitations
- stay bonus
- step-down provision
- stock purchase agreement
- stock sale
- strategic acquisition
- strategic acquisition
- structure of transaction
- subordination
- substance over form
- substantially all assets
- success fee
- successor liability
- sufficiency of assets rep
- supply problems
- survival of covenants
- survival of reps and warranties
- tangible net worth
- target's stock options
- tax
- tax benefit sharing
- tax deferred reorganization
- tax penalties and additions
- Taxation
- termination of M&A agreement
- termination or breakup fee
- third party
- third party beneficiary clause
- time of the essence
- timely objection to indemnification claim
- tolling
- tolling
- tort misrepresentation in M&A
- tortious interference with prospective economic advantage
- trade secret misappropriation
- trade secret misappropriation by former seller employee
- trademark infringement
- trademarks
- transferee liability for taxes IRC Section 6901
- TRO/preliminary injunction before filing for arbitration
- tying fraud to economic loss
- typo or scriverner's error
- UCC search
- Uncategorized
- Uniform Fraudulent Transfer Act or Uniform Voidable Transfer Act
- union fringe benefits
- union liabilities
- unitary business
- unjust enrichment
- unliquidated or disputed claim
- unwanted assets
- vacation time
- valuation
- waiver of contractual provision
- waiver of jury trial
- waiver of removal to federal court
- waiver provision
- willful breach carveout
- willing buyer or procuring cause
- Withholding Post-closing payments
- working capital adjustment
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