BUSINESS AND REAL ESTATE | Business Formation and Governance

Every business is operated through some type of business entity. Business entities include, without limitation:

• Sole proprietorships
• General partnerships
• Limited partnerships
• Limited liability companies
• Corporations

While the formation of each of these entities is a relatively simple process, it may not be as easy to determine which form of corporate governance will:

• Maximize tax benefits
• Optimize voting power
• Promote the most beneficial activity between principals
• Fairly distribute profits and cash

Our attorneys work with clients to select and design a corporate entity that will provide maximum benefits, both in the short term, and in the future.  In addition, governing documents for the entity such as Articles of Incorporation, Bylaws, Operating Agreements and Stockholder Agreements are crafted to provide the proper sharing of voting power, authority to conduct business among the principals, and the appropriate entitlements to share in the new company’s profits and cash distributions. Finally, consideration is given to exit planning, placing appropriate restrictions upon the principals’ ability to sell or transfer their ownership interests, and how, if at all, ownership of the business entity ties into the principals’ estate and asset protection planning.

The formation of a new business also requires that decisions be made about how to capitalize the new venture. Offit Kurman business attorneys help to facilitate capitalization by owner equity investment, bank and private debt financing and venture capital transactions.  Identifying all business formation and governance issues at the outset makes it less likely that the company will flounder when faced with changing circumstances.