A buy-sell agreement is meant to protect the interests of the business and all the partners involved by establishing guidelines for selling the business shares. A company’s buy-sell agreement should dictate when shares can be sold, in what manner they can be sold, and the price at which they can be sold. The agreement will…

Shareholder agreements are documents that provide businesses with a roadmap of how to act in certain situations.  A shareholder agreement is negotiated and executed so that common procedures will be established before any business problems develop.  Generally, the most important issues contained in shareholder agreements are those that address stock ownership.  A shareholder agreement can…

After completing  an initial public offering (IPO), a company may  decide to offer additional securities, either debt or equity, to the public. These offerings are referred to as “follow-on” offerings because they follow the IPO. There are two different types of follow-on offerings: A primary offering is a public offering of securities that is made…

Some people consider an investment in a Private Placement Offering (PPO) to be speculative and highly risky. While there is a certain amount of risk to investing in PPOs, there are regulations in place that are meant to protect those investors who choose to participate in these offerings. Generally, investors must meet the qualifications of…

As businesses grow, it is not uncommon for them to establish and control several subsidiary companies. Establishing subsidiary companies can be of great benefit to a parent company, as they offer the opportunity to expand the business with minimal risks. Subsidiaries can be formed in different ways and for various reasons. A corporation can form a…

Financial Industry Regulatory Authority (FINRA) has announced that it is expanding its free, online service, BrokerCheck, to reveal additional and more detailed information concerning brokers and brokerage firms. Changes being made to BrokerCheck include the following: •           All historic complaints dating back to 1999 for individual brokers who are currently registered or whose registrations were…

Buried deep in the (literally) thousands of pages in The Dodd-Frank Wall Street Reform and Consumer Protection Act are changes to Regulation D and the accredited investor definition. Currently, individuals are accredited investors if either: their net income exceeded $200,000, or joint net income with their spouse exceeded $300,000, in the two most recent years…

The purpose of an operating agreement is to establish the rights, powers, duties, liabilities, and obligations of the members between themselves and with respect to the LLC. An operating agreement aids your LLC by guarding your limited liability status, heading off financial or management misunderstandings, and making sure your business is governed by the rules…

If you plan to acquire a business through a merger, you will need to conduct an in-depth investigation of that business before proceeding with the transaction. This process is called due diligence, and it often requires careful review of documents by a corporate attorney. By conducting due diligence on the target business, you will gain…

When setting up your business, you should choose your structure carefully, as whichever structure you choose will have profound implications for taxes, regulatory restrictions, finance considerations, and other legal issues. Two of the most common business structures are corporations and LLCs. Corporations are considered legal entities of their own, separate from the business owner who…