Build Your Small Business On A Solid Legal Foundation – 5 Tips

Building your small business on a solid legal foundation is as essential as building a physical structure on solid ground – a weak foundation (whether physical or legal) may result in the business crumbling.  So what can you do to build your small business on a solid legal foundation and eliminate future legal headaches and intra-corporate disputes?  The following list of five items should be among the many legal issues you consider when starting a small business as a limited liability company (“LLC”):

1.  Will the LLC be run as a member-managed LLC or a manager-managed LLC?

2.  How will the LLC address fiduciary duties?  For example, will the LLC seek to impose strict fiduciary duty principles or will the LLC seek to restrict fiduciary duties?

3.  Will the LLC allocate profits and losses based upon the members’ respective capital contributions or percentage of ownership?

4.  Will the LLC indemnify its members, managers, and possibly employees?  If so, what limitations, if any, will be put in place?

5.  Will the LLC provide advancements for legal expenses?  If so, to whom?  Employees?  Members?  Managers?  Agents? 

These are just five of the many legal considerations a small business owner or prospective small business owner should consider to avoid future legal troubles and intra-corporate disputes.  To receive five additional legal considerations, please feel free to send me an email at mckinney @ brownwinick.com.

It is important to remember that laws on these issues can vary from state to state and from one business entity to another.  To obtain information specific to your business and goals, you should contact a licensed attorney.  If you have questions or comments on this artcile or the topics discussed, you can contact me at mckinney @ brownwinick.com. 

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Matthew McKinney, as owner and host of this site, cannot and does not warrant the accuracy or reliability of the information presented on or through this site.  The information on this website does not constitute legal advice and readers should not rely on it to solve problems;   Further, you should seek licensed counsel before taking any action.  Any information provided on this site is presented “As Is” for your personal curiosity and enjoyment.  It is not meant to be relied upon for legal advice, counsel, or for any other purposes.  Such information does not take the place of a lawyer.  Rules and laws differ by jurisdiction and the information contained within this website may not apply in your jurisdiction.  The appearance of articles, listings, or ads, by or for professionals, on this site, does not constitute an endorsement.  In all cases, you are responsible for determining the quality of services, information, and/or advice provided by professionals through, or as a consequence of, your use of this site.  Neither Liability nor responsibility shall arise to any person or entity with respect to loss or damage caused (or alleged to be caused), directly or indirectly, by information posted on this website, or by reason of contact with a professional listed on, or posting information to, this site.  No attorney-client relationship is formed by viewing this website and practice is limited to jurisdiction where lawyers are admitted.  The information furnished on the website is only general and not a substitute for personalized legal advice.   Legal advice cannot be given without full consideration of all relevant information relating to the individual(s) situation.  Laws can change daily and new laws may, and likely will, affect the accuracy of the information herein.  The information herein may be outdated and replaced by new law.

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Sending an e-mail will not make you a client.  Until an agreement regarding representation is reached with you, anything you send will not be confidential or privileged.  Before representation can occur, a lawyer will first take you through the conflict of interest procedure and see that you are put in touch with the lawyer best suited to handle your matter.

 

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About Matthew McKinney

Attorney focused on civil and commercial litigation.
This entry was posted in Business Owner, Director, Litigation, Officer and tagged , , , , , , , . Bookmark the permalink.

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