There are many types of business entities to choose from to operate your business including partnerships, corporations and limited liability companies. When choosing a business, you should consider:
- Organization Documents
- Ease and Expense of Organization
- Liability for Organization Obligations
- Term of Organization
- Capital Outlay
- Participation in Management
- Transferability of Interests
- Exit Strategies
Operating a business is exciting and challenging. There are times when the business is generating its own cash and other times when the business is in need of cash. Structuring the right debt and equity is crucial to your business’s prosperity and existence.
When the business is experiencing financial difficulty, the business and its owners may be able to restructure the company’s financial obligations through a workout agreement. Restructuring the business obligations may include extending periods of time to repay debts and reduce the principle and interest owed to creditors.
Managing employees is crucial to operating a business. Employees are an important asset of the business. They have contact with your customers, business partners, suppliers, vendors and others. Employees should have a clear understanding of the employer’s policies, procedures and compensation. Structuring the right agreements with employees can make the difference between a thriving business and a mediocre business.
Appropriately managing business transactions is a necessity. Customers need to be able to differentiate your products and services from other companies. Protecting your company’s intellectual property through appropriate copyrights, trademarks, patents, license agreements, confidential agreements and nondisclosure agreements are key to your business success.
Managing your business’s real property and personal property transactions are also a necessity. Failure to adequately structure purchases and leases of both real and personal property can lead to the demise of your business.
Selling a Business
Selling a business can be rewarding. Careful consideration should be given to tax issues, legal requirements for the sale and business decisions. When thinking about the form and structure of the sale, consider the following:
- Assets to be sold and retained
- Assumption of liabilities
- Purchase price and terms of payment
- Closing procedures
- Obligations prior to closing
- Obligations after closing