Choosing the right business structure is critical. It is also very PERSONAL. There are liability, compliance and tax considerations that must be contemplated when making this choice. This is why you should not do it alone and why you MUST have a competent professional that specializes in these areas to assist you. For example, there
All that glitters is not gold!
We are regularly contacted by budding entrepreneurs that are pretty “long” on ideas but a bit “short” on money. A number of them have shared their ideas with others and in turn, get leads for funding. In some cases, the opportunity for an investor arises. This is the golden ticket, right? Not so fast. Outside
The “Born” identity: Assumed Names
Do you want to abbreviate your company name on your advertising materials? Do you want to transact business under another name without forming a new entity? Both are feasible under Michigan law, but you must make sure to follow the right steps! First, the law requires that you file a Certificate of Assumed Name for
DO your DUE diligence…
Jim has an amazing idea to start a new housing project. His only problem is he doesn’t have the capital. He thinks of Fred, a longtime friend who doesn’t have much business experience but has a lot of money and owns some property. He sits down with Fred and convinces him that a generous cash
Fight for your (voting) rights!
Partnering up on a business venture? There are quite a few matters you should be sure about before you ink the deal. One of those is how voting is covered. Is it one man, one vote? Is it in accordance with percentage of membership interest? Do you have a majority? This is HIGHLY relevant as
Think before you act!
You have the opportunity to open a physical location for your business. How exciting! We hate to play Debbie Downer, but when making significant decisions like this, you must consider what can happen in the worst-case scenario. This is prudent and necessary as a business owner. One of the factors you need to consider is
All in the same boat…
We have discussed the importance of all business organizations having governing documents, i.e. an operating agreement, partnership agreement, bylaws/ shareholder agreement, etc. One of the most common issues we run into is owners of single-member LLC’s failing to have an operating agreement. Most assume “I own the business alone- why do I need something like
Agreeing to Disagree: The Danger of the “Side Agreement”
Throughout the ordinary course of business, small business owners regularly enter into a variety of agreements with third parties, including vendors, employees, consultants and service providers. More often than we like, we come across owners who contract a third party, reduce an agreement to writing BUT also agree to some sort of verbal side deal
All’s well that ends well
Thinking about launching that business with a partner? Or is there already an existing business that you have been offered ownership in? Either way, one of the most important documents you will need is a Buy-Sell Agreement. Affectionately termed a Business Will or Business Prenup, this document (or sometimes a section within a larger legal
Deal or no deal?
You’ve been given an opportunity to partner with four other people in a growing venture. The venture is operated by a Manager-Managed LLC. You only know one of the members, who is not one of the appointed managers. If you put up $5,000 in cash, sweat equity drawing on your expertise and sign the operating
Tis’ the season- Make your list and check it twice!!
Business owners!! It’s that time again! Now that you are nearing the end of another year, it’s time to take a look at your records and assess what needs work. There are certain records that are industry and business-entity specific, but there are some records that EVERY business should maintain properly: organizational documents, accounting and
Sharing may not be so caring: the danger of borrowing contract templates
When you’re a small business owner, budgeting is everything. You try to keep costs down and save as much as you possibly can. What business owners MUST remember is that cost cannot always be measured in dollars alone. Some decisions you make on the front end can actually be costlier on the back end. There
Voidable Contracts: What’s done in the dark comes to the light!
As long as you get someone to sign a contract, they are obligated and there’s nothing they can do about it, right? Well, in typical lawyer fashion, the answer is: IT DEPENDS. There is a concept in the law referred to as a “voidable” contract. This means that a court can allow a party to
Playing with fire…Entrepreneurs: Are you running afoul of a non-compete?
Did you recently leave your job to strike out on your own? Have you started a business while you still have a full-time job? If you answered yes to either of these questions, it’s time to check your employment paperwork to make sure you are not violating a non-compete agreement. A number of employers routinely
Proposed Government Contractor Whistleblower Practices Rule may create more problems than solutions!
Take a look at this piece we came across regarding a proposed Government Contractor Whistleblower Practices Rule that may create more problems than solutions! On January 22, several government administrations proposed an amendment to the Federal Acquisition Regulation that would forbid the government from spending money on businesses or nonprofits who require employees or subcontractors
Small Businesses! Interested in becoming a government contractor?
Interested in making your small business a government contractor? Check out this amazing seminar on how to do just that! Wayne State University is offering a free seminar through its Procurement Technical Assistance Center for owners of small businesses interested in learning how to become government contractors. Opportunities within federal and state programs will be
PROTECT AND SERVE your business: The Non-Disclosure Agreement
It’s a new year and there are new opportunities on the horizon for expansion! Ready to talk to someone regarding a joint venture? A potential investor? A consultant or vendor for a major project? A new partner? For all of these scenarios and MANY more, you will undoubtedly be sharing sensitive information about your business.
Contract Matters…The Termination Clause: Mapping the Exit Strategy
Often times, business owners are presented with seemingly golden opportunities that they cannot pass up. They find themselves in a crunch to get a deal done and either sign an agreement that has not been reviewed by legal counsel or pull a boilerplate agreement from the web and present it to the other party. We
Website Disclaimers: Protection from the Foreseen and Unforeseen!
What’s a disclaimer? Generally, a disclaimer is a statement intended to protect from claims or liability. Do I need it? If you currently have or will have a website, then you NEED a disclaimer. A disclaimer on your site helps to reduce legal risks. While disclaimers do not guarantee a defense from liability, you need
The Verbal Agreement: It can work…until it doesn’t!
“I’m too busy to have an agreement done in writing!” “I trust him.” “They won’t agree to that term in writing!” These are just a few, but we have heard all the reasons in the world for why people have decided to seal a deal with a good old fashion handshake or conversation. And while
Court enforces settlement agreement that client swears he didn’t authorize!
Check out this interesting Michigan Court of Appeals case where the court enforced a settlement agreement reached between a construction company and the estate of its former client. GTS Construction Company contracted with Juanita Dansby and her son to repair damage to her home. At the time of Dansby’s death, an unpaid balance remained on
The enforceability issue rears its ugly head again!!
This recent case involves a dispute over the enforcement of a restrictive covenant in an employment agreement between an ophthalmology practice and one of the doctors it formerly employed. The agreement contained two clauses that were at issue- one that prohibited its assignment (handing off obligations and rights of a contract to another party) and
Settlement agreements are great…when they are enforceable!!!
Take a look at this Michigan Court of Appeals case where the court found an alleged settlement agreement between a former employee and employer was unenforceable because there was no signed writing showing assent to the agreement. The former employer attempted to enforce a non-compete clause, along with other provisions in the settlement agreement, against
Arbitration: The Road MORE or LESS traveled?
A lot of companies have employees and contractors sign arbitration clauses so that in the event of a dispute, the matter is not handled in the courts. Arbitration is a form of private dispute resolution, which provides parties to a controversy with a choice other than litigation. Arbitration can be voluntary or mandatory. There are
House Bill would ban noncompete agreements in Michigan!
March 23rd’s tip of-the-week discussed how tricky noncompete clauses can be. Check out this article about a newly proposed House Bill that if approved, would ban all noncompete agreements between employers and employees in the state of Michigan. Wow! Click here to read the article! *Please be sure to read the disclaimer section on
The Non-Compete Agreement- Beware: One Size does NOT fit all!
Employers often use non-compete agreements to protect their valuable assets, namely to have some assurance that their proprietary information and trade secrets will not be made available to competitors. Many business owners use a template that they downloaded from the web or got from a friend that owns a business/ had access otherwise. Saves on
Personal Guarantee: Using one’s personal credit to help build business credit. Proceed with Caution!!
Business Owners and Entrepreneurs: Understand all the risks and rewards from having to sign a Personal Guarantee! It is common for owners of new companies to be asked to sign a personal guarantee for anyone extending “credit”. Landlords, Suppliers, Financial Institutions and any other sources that may extend credit to your business may ask you
Home Healthcare Company may be on the hook for failing to monitor decedent’s blood sugar- even though it was not in the contract!
State Bar of Michigan E-Journal Number #58027 Michigan Court of Appeals (Unpublished) Estate of Richard v. Compassionate Care Home Health Serv. The court held that the trial court erred in granting summary disposition for the defendant-in-home care provider in the plaintiff-estate’s negligence claim. Defendant was hired to provide in-home care for plaintiff’s decedent, including monitoring