Henry Hobson is a swaggering widower who fancies himself superior to everyone because he owns a shoe company. Hobson’s daughter Maggie actually runs the business, but Hobson does not pay her.
Hobson is downright mean to most people in his life. He belittles Maggie and tells her she’s too old to get married. At the same time, he refuses to provide marriage settlements for his other daughters Alice and Vicky and refuses to let them marry their chosen beaus (Albert Prosser, Esq., and Freddie Beenstock, respectively). Hobson also belittles his star employee Will Mossop in front of customers, leading to a very posh customer (Mrs. Hepworth) swearing that she will never set foot in Hobson’s shop again. When Hobson isn’t busy bringing sunshine into everyone’s life, he can be found at the local pub.
Maggie and Will bond over their shared love of shoes and their hatred of Hobson’s bullying ways. Maggie and Will finally decide to get married. Hobson responds to the engagement by threatening Will with a belt and raging that their marriage will make him the laughingstock of the community. Afterwards, a fight ensues, and Will and Maggie walk out, leaving Hobson to mind his own business.
Maggie and Will visit Mrs. Hepworth who gives them a small business loan. Together, Maggie and Will develop W. Mossop, a high-class cobbler. Like any good business (and life) partner, Maggie recognizes and acknowledges the value of Will. Maggie also works with Will to improve his education and business acumen. Maggie knows that exploiting a business partner is a recipe for failure.
Hobson continues to medicate himself with alcohol while spitting his hate-right venom at the local pub. On the night of Maggie’s wedding, Hobson drinks himself into a hallucinatory stupor. Returning from the pub, Hobson jumps into Beenstock’s cellar where he damages the cellar and inventory. Beenstock is suing Hobson for trespass and damages. Hobson settles the matter out of court by providing Alice and Vicky with marriage settlements so they can marry their beloved ones (the aforementioned Albert Prosser, Esq., and Freddie Beenstock).
Undeterred, Hobson continues on his path of self-destruction, while Maggie and Will build a thriving business. Hobson’s doctor diagnoses him with chronic alcoholism, declares he cannot live on his own, and threatens to have Hobson certified. Vicky and Alice refuse to help and insist that Maggie take care of Hobson.
Hobson finally “allows” Maggie to move in and sparingly offers to pay Will his old salary and half of the house expenses. Maggie and Will lay down the law and announce that they will only return as equal partners, with Hobson as their silent partner. In a shocking moment of reason and clarity, Hobson agrees to their terms.
What should have happened:
Maggie meets Wendy and Jen at a networking event. Maggie tells Wendy and Jen that she ran her father’s business (Hobson’s) for years. Maggie also tells them that her father went to great lengths to diminish the value of her contribution. Every year Maggie demanded to be paid a salary, and every year Hobson weaved a convoluted story of high cost of ownership and little profit (even though Maggie kept the books). Maggie tells Wendy and Jen that Hobson pays no attention to the business because he’s too busy frolicking, taking long vacations, and spending his days drinking expensive wine at fancy restaurants.
Maggie reveals that her fiancé Will Mossop is an extremely talented craftsman who has made a name for himself as a posh cobbler for the well-heeled set. Maggie says Hobson failed to realize Will’s genius and consistently downplayed his contributions. After Maggie and Will announced their engagement, Hobson threw them both out on the street. Maggie tells Wendy and Jen that she and Will are opening a new shoe business called “Mags & Mossop”.
Wendy and Jen congratulate Maggie on her newfound independence and explain that Maggie and her fiancé need to think carefully about what kind of entity to form for the business. Wendy and Jen explain that Maggie and Will must resolve important issues such as the distribution of equity and profits, in addition to the conditions related to the repayment of their start-up loan. Maggie is grateful for the advice and so happy to be taken seriously after years of exploitation by her father.
Maggie meets Wendy, Jen and their partner Kate Heptig. Kate is immediately seduced by the Mags & Mossop ballerina and swears her eternal loyalty to the brand. Kate then listens to Maggie’s business plan and recommends an S Corporation. Kate tells Maggie that Will needs to hire a separate lawyer to review the shareholders’ agreement on his behalf to avoid a conflict of interest. Kate forms Mags & Mossop, Inc. and drafts the shareholders agreement which gives Maggie a 51% stake and Will a 49% stake. The shareholders’ agreement clearly defines the responsibilities of each shareholder as well as the liability for current and future debt.
Maggie and Will sign a prenuptial agreement and have an amazing marriage. Their guests dance until dawn in their limited-edition Mags & Mossop wedding shoes.
Mags & Mossop, Inc. is a resounding success; Maggie and Will repay their loans and make historic profits.
Business expert Maggie wants to create a global online presence for people to buy Mags & Mossop shoes from anywhere on the planet. Maggie creates a platform that allows customers to upload their foot measurements and style preferences to a proprietary portal that designs and delivers a customer’s bespoke Mags & Mossop shoes to them in fourteen days. Kate helps Maggie form Maggie’s Moulds, Inc. Wendy and Jen explain to Maggie that the individual investment in Maggie’s Moulds, Inc. may be eligible for Qualified Small Business Stock (QSBS) treatment which will allow Maggie to exclude a large portion of her capital gain when she later sells some of her shares. Maggie is working with Wendy and Jen’s partners, Mike Cannata and Nancy Del Pizzo, to secure appropriate intellectual property protections and licensing agreements. Maggie also works with Wendy and Jen’s partner, Lou Vlahos, to make the right tax choices.
The following year, Maggie tells Wendy and Jen that her father (Hobson) has asked Maggie and Will to become partners in Hobson’s sole proprietorship. Hobson wants Maggie and Will to become his home helpers and give up their successful businesses to become 50% partners in his struggling store.
Wendy and Jen have lots of questions and some suggestions. Wendy and Jen want to know why Hobson needs round-the-clock care. Maggie explains that after a lifetime of alcohol abuse, her father has about six months to live. Maggie says Hobson had hallucinations. Hobson’s doctor concluded that he could not live on his own and threatened to have Hobson certified. Maggie tells Wendy and Jen that her two younger, prominent, snobby sisters said it was Maggie’s problem and not theirs (they’ve always been unhappy with her success).
Wendy and Jen explain to Maggie that if Hobson lacks ability, he can’t make a valid partnership deal. Wendy and Jen also explain that Maggie would likely be considered Hobson’s caregiver, and business deals with caregivers come under scrutiny, as the relationship can easily lead to undue influence.
Wendy and Jen also point out the unfairness of the deal. Mags & Mossop, Inc. and Maggie’s Molds are thriving, independent, debt-free businesses. Bringing two successful companies together in a struggling partnership is like driving a brand new car off a cliff. Additionally, there will be tax consequences as joining the entities will be considered a sale or liquidation, with specific tax consequences. Assuming Hobson has the ability, the best option would be to buy his business name and real estate at fair market value. Wendy and Jen also warn that Hobson must have independent counsel of his own choosing. Not only does independent representation avoid a conflict of interest, but it will help justify Hobson’s lack of undue influence and ability to pursue his own interests. The structured buyout can provide Hobson with equal monthly payments, which he can use to hire a housekeeper and a cook.
Hobson performs a full neurological evaluation. Wendy and Jen send the proposal to Hobson’s attorney and son-in-law, Albert Prosser, Esq., who reviews the terms. Hobson complains to Albert that the proposal really offers him nothing more than a take-it-or-leave-it option. Albert explains that the proposal gives Hobson a way out of the hole he’s made for himself and allows him to live independently without having to answer to Maggie. Albert also explains that Hobson might try to sell his business to someone else. Eventually, Hobson rejects the offer and moves in with Alice and Albert. Maggie and Will, breathe a sigh of relief and continue building their global empire. In 2022, Maggie was named Business Leader of the Year by Snazzy Shoe Magazine. Netflix even offers the rights to Maggie’s life story. Wendy, Jen and Kate all attend the world premiere of heartwarming film ‘Maggie’s Magic’ wearing limited-edition sparkly Mags & Mossop shoes.
Building a business involves growth and the ability to recognize and nurture the talents of the people around you. Setting up a business involves complex organizational and tax issues that need to be taken into account. Business is business, even when it’s family. It is important that all stakeholders have the opportunity to consult independent representation. Solving potential problems early in a business relationship helps avoid real problems later. Your business is your livelihood and it is important to consult competent and experienced lawyers.
Save the drama for the movies.