Hospitality Clients and Representative Matters
Hospitality Clients
Successfully operating a business in the hospitality industry is extremely challenging. Every empty table at a restaurant or vacant room at a hotel represents an unrecoverable loss for a hospitality business. Yet, the business must be ready at all times to be able to accommodate sudden demand. This means maintaining perishable supplies that may go to waste, ensuring the availability of appropriate staffing who may sit idle, adjusting offerings and pricing on short notice, and many other challenges that are not present in more conventional businesses. In addition, there is an overlay of licensure and labor law issues to contend with. And the hospitality industry is particularly vulnerable to social media attacks that can devastate a business without valid reasons. Over the years, Mr. Bogen has counseled numerous clients in the hospitality industry and well understands their business challenges.
Mr. Bogen has represented (and continues to represent) a variety of different hospitality companies, including:
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Restaurants
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Hotel Resorts
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Bars/Taverns
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Cooking Schools
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Commercial Kitchens
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Food Delivery Services
Representative Matters
Formation of Hospitality Businesses:
Mr. Bogen advises hospitality businesses on all aspects of the formation of their businesses, including advice on the form of entity, such as a corporation, limited liability company, or partnership for the business. He then forms the entities. He helps to formulate, negotiate and document capital raising arrangements including guidance to reaching agreement, expressed in bylaws, an operating agreement, shareholders agreement or other governing documents, on control and governance, liquidity and transfer of equity, restrictive covenants, compensation issues and other matters necessary to define the contours of the arrangements and relationships among the participants. He also helps negotiate leases and other important contracts with outside parties. Once formed, most clients continue to retain Mr. Bogen as their outside general counsel for all legal issues that arise.
Purchases and Sales of Hospitality Businesses:
Mr. Bogen represents buyers and sellers of hospitality businesses. These deals include negotiating and drafting purchase price provisions that may include seller or outside financing, restrictive covenants, continuing employment or consulting arrangements, transition issues, closing conditions, representations, warranties and indemnifications. He also assists with due diligence reviews of various aspects of the business. Mr. Bogen’s approach to purchase and sale transactions is to encourage the parties to focus on big picture items to avoid wasting time and efforts on matters that will likely be of little “real world” consequence, and to be transparent and reasonable to create the trust necessary to get to a closing and thereafter to facilitate a positive relationship between the parties that will result in cooperation (in lieu of litigation) if unanticipated issues arise. This approach is accompanied by Mr. Bogen’s ability to strongly advocate for his clients, and to stand firm without creating drama, on matters of importance to them.
Real Property Purchases and Leases:
Mr. Bogen advises his clients on purchases or leases of real property for their enterprises. Because the real property is central to the success of most hospitality businesses, these transactions require careful review and strong negotiation. With purchases, it is critical to assure that the location is in an acceptable zone, that there are no deed restrictions that apply to the property and that title is clean. For leases, the term, renewal options, termination provisions, assignability, signage, and in many instances, parking, clauses are critical among other provisions. Of course, in either case the purchase price or rent (and escalations and pass-throughs) are of utmost importance.
Employment Arrangements:
Mr. Bogen assists his clients with designing employment or independent contractor arrangements that will properly incentivize employees, especially senior management and staff, such as Executive Chefs, to perform well. Important features can include bonuses, equity opportunities, restrictive covenants, and a clear articulation of time commitments, performance goals and associated rewards. Mr. Bogen is not a labor lawyer and when collective bargaining or workplace rules and regulations are involved, he brings in outside counsel that focus primarily on these matters.
Financing Transactions:
Mr. Bogen is conversant in helping his clients with obtaining financing including secured financing, asset-based loans backed by accounts receivables and factoring arrangements.
Management Contracts and Other Transactions:
Mr. Bogen often functions as the “go-to” lawyer for his hospitality clients. In this capacity, he reviews and negotiates agreements with management companies, important vendor agreements, and other significant transactions. He also helps clients with structuring strategic alliances and joint ventures. In many cases, his hospitality clients reach out to him before making any important business decision.
Dispute Resolution:
Mr. Bogen assists his hospitality clients with resolving disputes among stakeholders, with lenders, with landlords, with employees or independent contractors and with vendors.