Best Best & Krieger News Feed

Veteran Business Attorney Daniel W. Kehr Joins BB&K

03 Aug 2016 00:00:00 -0800

For Immediate Release: Aug. 3, 2016
Media Contact: Denise Nix • 213-787-2552 • denise.nix@bbklaw.com

SAN DIEGO, Calif. - Best Best & Krieger LLP is pleased to welcome Daniel W. Kehr as a partner to the Business practice group. Based in the firm's San Diego office, Kehr provides corporate general counsel, technology, real estate, as well as trust, estate and succession planning legal services.

Prior to joining BB&K, Kehr managed his own law firm, Kehr Law. Kehr provides legal services for a variety of clients, including individuals, entrepreneurs, investors and businesses, including start-ups and mature companies, across a broad range of industries, such as technology, software, Internet, gaming, insurance, manufacturing, distribution, real estate and professional services.

“Dan's experience as a business owner gives him a unique perspective that his business clients appreciate and benefit from. That experience, coupled with his knowledge and skills in handling a variety of business law matters, make Dan an asset to the firm's clients,” said Managing Partner Eric Garner.

A native of Huntington Beach, Calif., Kehr attended the University of California, Los Angeles for his undergraduate studies. He was an NCAA intercollegiate baseball athlete. He earned his law degree from California Western School of Law in two years, and passed the California bar exam while studying at the University of San Diego.

Kehr’s full biography is available at www.bbklaw.com.

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Best Best & Krieger LLP is a national law firm that focuses on environmental, business, education, municipal and telecommunications law for public agency and private clients. With 200 attorneys, the law firm has nine offices nationwide, including Los Angeles, Sacramento, San Diego and Washington, D.C. For more information, visit www.bbklaw.com or follow @BBKlaw on Twitter.

Best in Law: Know 'What-Ifs' of Every Transaction

16 May 2016 00:00:00 -0800

By D. Brian Reider

A standard part of the pre-flight instructions on every airline is the directive to “look around and identify the nearest exit.” That is good advice, because it allows you to be prepared if things do not go according to plan. Did you know that it also happens to be great legal advice?

I represent clients on a broad variety of matters, including real estate purchases and sales, leases, contracts, the purchase or sale of businesses, loans, incorporations, the formation of limited liability companies and partnerships, and many others. In every type of transaction, when I meet with my client, and we start talking about the deal, one of my first questions is: do you know where the exits are?

What I mean by this is “have you thought about the end of the deal, or how you might have to get out before the deal is over?” Some of my clients have thought this through, and have a ready answer. Many others, however, seem to have never considered the question before, and don’t have a clear and ready answer.

There are a lot of reasons for this, including our natural excitement about setting off on a new venture, and growing our business. Who wants to think about the bad stuff at such an exhilarating point? To those clients, I am sure I sound like the attorney version of Debbie Downer – always finding the dark cloud inside the silver lining!

For those clients, I try to explain why it is so critical to consider the “what ifs” of every transaction. What if the business does not perform as expected? What if your partner, who seems so wonderful, turns out to be impossible to deal with? Even the question of “what if the contract ends” is important to consider – how does everything get wound up properly.

Take, for example, a new technology contract in which you are having a company process your data. Does it address what would happen if the vendor can’t perform as promised? More importantly, does it allow you to get out of the contract without a penalty and does it address how such a transition to a new vendor would occur?

Even if everything goes right, what happens at the end of the contract – how do you reacquire your data and migrate it to a different provider? Think of the contract as a long hallway pointing to the exit at the end of the term – does the hallway also need other exit doors just in case along the way and if so, where should they be and how should they operate?

Or suppose you have a successful business which you think would really take off if you were to partner with another business that has also been successful. Everyone on both sides is optimistic that the business plans, the culture and all other pieces will come together well and that the resulting merged enterprise would be a dominant force in the market. But what if the fit is not as good as hoped? What if the cultures clash and instead of growing, the resulting business declines? How can you get out before it is too late?

There is no one single answer to these questions, which are always specific to the deal. But there are always ways to ask the questions that should be raised.

First, with the help of your attorney, walk through the proposed business arrangement and ask the key “what ifs.” “What if” the performance does not match the pro forma projections? “What if” what appears be a great business fit is not? “What if” the project finishes and needs to be wound up in the most efficient way possible? “What if” the lease ends and you have to vacate the premises – how much time do you need to make sure you can smoothly move to another location?

Your attorney is trained to look at just these kinds of questions, and to draft documents that can, if not totally resolve them, at least create a road map of what to do should an issue arise. The time to consider these questions is before anything gets signed and becomes binding. A small amount of planning in advance is very likely to avoid huge (and expensive) problems down the road.

* This article first appeared in The Press-Enterprise on May 15, 2016. Republished with permission.

Peregrine Semiconductor Sale Draws a Crowd of Lawyers

19 Sep 2014 00:00:00 -0800

When San Diego-based Peregrine Semiconductor Corp. announced its decision to sell the company for a 63 percent premium above its market value, at least eight law firms announced investigations into the chip maker’s business the same day, alleging its shareholders were getting short-changed on the offer price.

Those eight “first responders” were followed by at least 10 more announcements of investigations in the next few days from law firms that said the $12.50 per share offer from Japan’s Murata Manufacturing Co. was too low.

One firm, Tripp Levy PLLC of New York, said its investigation concerned whether Peregrine’s board breached its fiduciary duties by failing to shop the company to other possible buyers, or whether there were possible conflicts of interest on the part of senior management or directors. Murata makes up about 70 percent of Peregrine’s revenue, and is a minority shareholder.

A call to Tripp Levy seeking additional details wasn’t returned, nor were calls to several other national law firms looking for shareholder redress on the proposed sale.

The reaction by the firms specializing in shareholder litigation is expected by companies and nearly automatic these days, said industry observers.

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Patrick Monroe, a corporate attorney at Best Best & Krieger in San Diego, said the many law firms investigations are all geared to finding willing shareholders to join their cause.

“Essentially what all these law firms are doing is competing to get the most shareholders,” Monroe said. If they achieve that, they can be certified as the class counsel for the shareholders, and stand to gain a big cut of any monetary settlement that’s negotiated, he said.

Click here to read the entire article published on Sept. 19, 2014 in the San Diego Business Journal (subscription required).

Sell Your Business in 2012 to Maximize Your Profit

25 Mar 2012 00:00:00 -0800

By George M. Reyes

If you’re a business owner nearing retirement or considering a business sale for other reasons, you may want to put that idea into high gear and sell before the end of this year.

Starting next year, the federal capital gains tax is expected to increase sharply, by 59 percent, which will significantly reduce the amount of money you will ultimately earn from your sale.

Here’s why: Beginning Jan. 1 the federal capital gains tax jumps from 15 percent to 20 percent. Combined with a new Medicare tax of 3.8 percent, that’s a whopping 23.8 percent that you will have to pay from your sale for federal capital gains taxes.

Click here to read the entire column on The Press-Enterprise website

Know Your Legal Options When Selling A Business

28 Feb 2012 00:00:00 -0800

By James R. Harper

Before negotiations go too far and you sign on any dotted lines, carefully consider the basic options for structuring the sale or purchase of your business. It isn't simply a matter of negotiating the best price. The legal structure of the sale transaction can take various forms that can have a major impact on the purchase price, liability exposure and tax consequences.

Buyers generally prefer to simply purchase the assets of the seller's business. Known as an “asset purchase,” a buyer can pick and choose which assets to purchase and which seller's obligations to assume, except for certain legally imposed obligations like tort and labor law liabilities.

Also an asset purchase provides the buyer a new, “stepped-up” tax basis in acquired machinery and equipment, allowing the buyer advantageous amortization and depreciation deductions. This gives the buyer the fastest tax write-offs after the acquisition. However, there are some disadvantages of an asset purchase.

In an asset purchase, the seller is subject to double taxation if the seller is a “C” corporation. The price for the assets sold by the corporation are taxed at corporate income rates, and then the distribution of the proceeds from the corporation to the owner are taxed again at the individual's applicable tax rate. This double tax can be avoided in some circumstances if the seller's business is an “S” corporation or LLC. Also, in California there may be sales tax on the sale of equipment in an asset purchase of businesses engaged in retail sales.

Contrary to the buyer's preference, a seller will generally want to sell the ownership interests in the business or the shares of stock if the business is a corporation.

Click here to read the full column.

Best Best & Krieger Elects Managing Partner to Third Term; Makes Other Key Decisions

16 Nov 2009 00:00:00 -0800

For Immediate Release: Nov. 16, 2009
Media Contact: Jennifer Bowles · (951) 826-8480 · jennifer.bowles@BBKlaw.com

RIVERSIDE, Calif. _ Best Best & Krieger LLP appointed attorney Eric Garner to another two-year term as managing partner. The appointment is effective immediately.

It marks the third term as managing partner for Garner, who since 2005 has sat at the helm of California’s 32^nd largest law firm with nearly 200 attorneys working at eight offices across the state.

“It’s been a privilege to lead such an outstanding group of legal practitioners, and I look forward to continuing with another term,” Garner, 47, said.

Garner, a well-known California water attorney, juggles his managing partner duties and an active water law practice at BB&K with his chairmanship of the International Bar Association’s Water Law Committee.

“Eric’s leadership will continue to guide the firm as it maneuvers successfully through these economically challenging times,” said James Gilpin, a member of the firm’s executive committee.

At BB&K since 1987, Garner has litigated cases and negotiated key agreements involving major water bodies across the state, including the Sacramento-San Joaquin Delta, the Mojave River, the Santa Ana River, and groundwater basins beneath Santa Maria, Chino, Monterey and the Antelope Valley.

Garner also co-wrote “California Water” and its updated 2007 edition, “California Water II,” widely considered to be the leading text on historical, legal and policy issues guiding the state’s more precious resource.

Besides making the decision on Garner, the firm’s partnership made other key appointments at its annual meeting Saturday. George Reyes, a well-known business attorney, was voted into another two-year term on the firm’s executive committee.

Reyes, who has been with the firm since 1978, has represented dozens of businesses in the Inland region, including clients in the retail, manufacturing and service sector industries. He is also on the board of directors for several foundations and organizations, including the Greater Riverside Chambers of Commerce, the Riverside Community Health Foundation and the Inland Empire Economic Partnership.

Reyes is perhaps best known for negotiating the 1997 sale of Riverside Community Hospital to Columbia HCA. It was a first-of-its-kind transaction because it included an $80 million endowment to create a foundation that offers free health care to the community.