Michael E. Eisenberg
Small Business
Incorporations
The choice of how to operate is important and is a choice made in partnership with your attorney and your tax advisor. Whether the decision is made to conduct business under a simple fictitious name or to incorporate for tax and liability protection should be discussed with both of business advisors, your attorney and your tax professional.
Incorporation provides a high degree of protection against certain claims as well as from business creditors, so long as the business contracts are properly created and executed and the corporate form, as a separate legal entity, is maintained. Certainly, there are more choices to be made and those should be made only after consultation with Attorney Eisenberg. Small Business
Sales/Purchases
The decision to sell or purchase a business is one that can be very exciting and frightening at the same time. The structure of the contracts is as important, if not more important, than the decision to sell or purchase a business. If purchasing at business, will the purchase be made with cash, with traditional bank loans, or will the seller finance the purchase? Will security interests be necessary and will the buyer’s spouse be required to guaranty any loans extended for the purchase and for operating capital?
The answers to these questions are best discussed with an attorney who has represented both sellers and purchasers. If selling a business, will the sale be of the assets or the shares of stock? Will the seller finance the sale of the business and what is the structure of the financing? Will there be security interests taken back to secure the payments and how far will the security interest reach? Protection is the key to purchasing or selling a business. Attorney Eisenberg has experience representing both the business seller and the business purchaser.
Buy-Sell, Shareholder and Partnership Agreements
The general, internal operations of your business should be defined by an agreement that defines the general duties of the various partners/shareholders as well as the rights of those officers and partners. Those agreements should also define what happens if and when a partner or shareholder retires, resigns or passes away. The fact is that the remaining partners, particularly after a death of a partner or shareholder, do not want the heirs of the deceased becoming involved with the operations of the business.
To prevent this event, a partnership or shareholder agreement is quite important. Defining the value of the entity for retirement equity is also important to the retiring partner and the remaining partners as well for creating a fair payment plan of a partner’s accrued equity. It is best for the owners to discuss ideas and to have at least a general consensus before seeking counsel. This keeps costs down and helps to avoid conflicts that might arise during the drafting and review process.
