Wanting to start your own business but don’t know where to start? Are you getting confused with all of the applications for SunBiz, the IRS, your local city, the State of Florida, or any other licensing entity? Are you unsure of how you want to structure your business: sole proprietor, limited liability company (LLC), partnership, S-Corporation, or C-Corporation?
All of this can be very confusing for the new business owner. Let Blake Stewart and his team help guide you through this process. Blake can simply consult with new owners and point them in the right direction, or do the whole process so that the owner can just turnkey and start business.
See below for short explanations on types of businesses.
- Sole Proprietor
- The simplest and most common structure.
- It is unincorporated with no “corporate veil”.
- Owned and operated by one individual; no distinction between the business and the owner.
- Sole proprietorships must register for a fictitious name when not operating under the owner’s legal name.
- Limited Liability Company (LLC)
- Similar to corporation in that it offers limited personal liability.
- Not required to hold regular stockholder or management meetings, or other corporate formalities
- For U.S. federal income taxes, an LLC is treated as a pass-through taxation entity.
- New legislation in the State of Florida is risk of persona liability for certain LLCs. Make sure you attorney is informed to help you form your company correctly.
- Two or more persons co-own a business and share profits and losses.
- Each partner contributes something to the business endeavor.
- In a general partnership, rights and responsibilities are divided equally among partners.
- General Partners can act on behalf of all partners.
- Each General Partner is responsible for the partnership’s debts and obligations.
- A corporation is an independent legal entity that exist separately from the people who own, control, and manage it.
- Does not dissolve when its owners die.
- Corporations can enter into contracts, pay taxes, transact business, etc.
- Owners have limited liability.
- More formalities involved compared to other types of corporate structures.
- Corporate Veil: (From businessdictionary.com) A legal concept that separates the personality of a corporation from the personalities of its shareholders, and protects them from being personally liable for the company’s debts and other obligations. This protection is not ironclad or impenetrable. Where a court determines that a company’s business was not conducted in accordance with the provisions of corporate legislation (or that it was just a façade for illegal activities) it may hold the shareholders personally liable for the company’s obligations under the legal concept of lifting (or “piercing”) the corporate veil.
- Fictitious Name: A fictitious name gives you the right to do business under a different name. This is typically you company alias or trade name that is different than your official (or legal) name.
- Official Name: Jane Doe
- Business Name: Jane’s Pie Shop
- Register DBA as “Jane’s Pie Shop
- DBA: Doing Business As
Contract Drafting & Review
According to Cornell University’s College of Law web site, a contract is an agreement creating obligations enforceable by law. The basic elements of a contract are mutual assent, consideration, capacity, and legality. Contracts typically arise when a duty comes into existence, because of a promise made by one of the parties. Adequate consideration must be given to the promise proposed for the contract to be legally binding.
Contracts are mostly governed by state statutory, common law (judge-made), and private law. Private law includes terms of the agreement between the parties who are exchanging promises. Private law may override state law. Statutory law may require some contracts be put in writing and executed with particular formalities. The Statute of Frauds dictates that any exchange for goods, or services totaling more than $500, as well as all real property transactions should be accompanied by a written contract.
Common types of agreements or contracts include:
- Bill of Sale
- Acquisition Agreements (for Sale of Business)
- Confidentiality Agreement
- Employment Agreement
- Non-Compete Agreement
- Partnership Agreement
- Licensing Agreement
Typically, clients will contact a lawyer after a contract has already been signed. The meeting is most likely scheduled when a breach of contract is presented. This is sometimes too late to get the most out of legal representation. The contract may not have adequately outlined the promises that each party has made, seeking reimbursement for damages may be out of the question if opposing party does not show assets, or worse, the client may have signed away their right to litigate or may have already put a personal guarantee on items they did not intend.
Contract reviews with The Daley Law Group are very involved and include research for a very reasonable price. Our package includes:
- Initial Consultation. This meeting is simply to attain the document and information about the given contract that include the relationship between the two parties, how the deal was initially perceived, and any risks the other party may pose in the deal.
- Contract Review. This is not your typical online or over the phone review. Some research work is included to ensure that the other party is a legal entity, that it exists with no outstanding claims against it, and to make sure the contract meets statutory standards and best practices for the particular industry. Industries can be highly specialized; omitting a simple statement in an agreement or application could void certain industries’ contracts.
- Final Consultation. This meeting is to present research, explain in lay person’s terms what the contract is saying, and explain what state mandated items are important in the document and why.
In the event that the existing contract is not one in which a client would like to continue with, we offer redlining and drafting services. Blake Stewart will work hard to ensure the document is up to industry standards and governing laws.
Blake Stewart can also attend document signings to provide support for any last minute questions or concerns. This ensures that opposing parties do not surprise clients with new documents or new renditions of reviewed documents.
Civil litigation takes place when two or more parties become embroiled in a legal dispute seeking money or specific performance as retribution. Criminal sanctions are not being sought in civil litigation. Types of civil litigation performed by The Daley Law Group include:
- Landlord/tenant disputes
- Product liability lawsuits
- Construction liability lawsuits
- Employment and labor disputes
- Real estate lawsuits
Most civil litigation in which The Daley Law Group performs involves a breach of contract. In order for a case to be viable enough to take before the court, the following must be true:
- The contract is valid.
- The plaintiff can show that the defendant breached the contract.
- The plaintiff did everything required of him/her in the contract.
- The plaintiff has notified the defendant of the breach (best if in writing).
The defendant can and should give reason why the alleged breach is not really a breach of contract. Defenses for this include:
- Defendant must provide proof that plaintiff knowingly misrepresented or concealed the truth to induce one to act in his/her own detriment.
- Defendant must prove that plaintiff compelled by force or threat to sign the document. This invalidates the contract.
- Undue Influence. Defendant must prove that plaintiff used his/her power advantage to force a signature.
- The defendant must prove that both parties made a mistake about the subject matter.
- Statute of Limitations. Defendant must show that the statute of limitations has expired.
Remedies for a breach of contract include:
- General Damages. These are actual losses.
- Consequential Damages. This is typically loss of cash flow resulting from the losses.
- Punitive Damages. These are typically tacked on when breach can be proved to be maleficent.
- Court can use an injunction to require other party to stop an action that is causing damage.
- Court can terminate the contract if/when plaintiff has been damaged by the breach.
- Specific Performance. Court can order defendant to carry out what was promised in the original contract.
Before filing a claim for a civil litigation case, it is important to consider the amount of investment it will take to file and make your case. Click the link below to see the fee schedule for Brevard County Clerk of Courts. Small claim’s filing fees start at $55; civil litigation fees can grow as large as $400 or more. Second, attorney fees for writing and defending the complaint in court can add up as well. You can estimate that the minimum of 3 hours will be billed to get a plaintiff to his/her first hearing. In 2012, the average hourly rate for associate attorneys was $370 per hour (Source: ABA Journal). Third, litigation can be time consuming and court dates are mandatory.
If litigation is still warranted, it is best to meet with a couple of attorneys to see who will have the most promising plan for litigation. A good attorney will not be so quick to rack up billable hours, but should attempt a formal demand letter to settle the case before getting the courts involved.
EB-5 Investment Vehicles
The U.S. Citizenship and Immigration Services (USCIS) administers the EB-5 program. Congress created the program in 1990 to stimulate the U.S. economy through job creation and capital investment by foreign investors.
EB-5 investors must invest in new commercial enterprise. New commercial enterprises can be any type of for-profit corporate structure that is established after November 29, 1990. If established on or before that date, the business must be one of the following:
- Purchased and the existing business is restructured or reorganized in such a way that a new commercial enterprise results.
- Expanded through the investment so that there is a 40-percent increase in the net worth or number of employees occurs.
Job Creation Requirements
- Create/preserve at least 10 full-time jobs for qualifying U.S. workers within two years of the immigrant investor’s admission to the United States as a Conditional Permanent Resident.
- Preserving jobs can only be credited if in a troubled business. A troubled business is an enterprise that has been in existence for at least two years and has incurred a net loss during the 12-24 month period prior to the priority dated on investor’s Form I-526. The loss must be at least 20 percent of the troubled business’ net worth.
- It is possible to have a job-sharing arrangement in which two or more qualifying employees share a full-time position. Hourly requirement per week must be met. Positions must be permanent.
- There are 2 types of jobs:
- Direct jobs are actual identifiable jobs for qualified employees located within the commercial enterprise that has directly received investment.
- Indirect jobs are those jobs shown to have been created collaterally or as a result of capital invested in a commercial enterprise affiliated with a regional center by an EB-5 investor.
- Calculation can only be used if affiliated with a regional center.
Capital Investment Requirements
- Capital includes:
- Other tangible property
- Cash equivalents
- Indebtedness secured by assets owned by alien entrepreneur (investor)
- Capital is valued at fair-market value in USD.
- Assets acquired by unlawful means cannot be considered capital. Money trail must be available and verifiable.
- Capital cannot be borrowed.
- General minimum investment is $1 million.
- Targeted Employment Areas minimum investment is $500,000.
- Targeted Employment Area: at the time of investment, is a rural area or experiencing unemployment of at least 150 percent the national average rate.
- Rural Area: outside a metropolitan statistical area or outside the boundary of any city or town having a population of 20,000 or more.
Attorney Blake Stewart may be able to help with all business documents necessary for such a visa. It is important to have a business attorney who is knowledgeable concerning the laws governing EB-5 investments to ensure all criteria are being met in regards to business agreements.
Blake Stewart is also fluent in English and Spanish to better communicate legal needs between parties.
Note: Blake Stewart is not an immigration attorney. He is happy to work intimately with trusted immigration attorneys to best represent his clients.
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