Entrepreneurial Law Attorneys TN | Tressler & Associates, PLLC
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212 N. Castle Heights Ave | Lebanon, TN or 2323 21st Ave South STE 506 | Nashville, TN

Entrepreneurial Law

Entrepreneurial Law

When you’re starting a new business, you do all you can to make it successful. You have a revenue plan, marketing strategies, business partners, and a product line, but you also need legal representation to protect all those things. Some documents need to be written and signed to confirm ownership, trademarks, financing, and more for your business. These can be between you and your partners, co-founders, and employees, and they need to be airtight. That’s where entrepreneurial law attorneys come in.

At Tressler & Associates, PLLC, our attorneys will make sure you have all the documentation, contracts, and agreements you need, written in ways that best support your business. If your small business, new or old, needs documentation and contracts to legally protect its success, you need an experienced Tennessee entrepreneurial law attorney. Our staff has the experience to help you protect the future of your business.

Entrepreneurial Law Services

Entrepreneurial law includes carefully written documentation, but no two are the same. They confirm legal, financial, and functional responsibilities to start. You can’t trust that a business partner will deliver ingredients, parts, or manpower on their word alone. The same thing can apply to investors, co-founders, and employees. You need to have legally binding paperwork to protect the structure of your business.

Tressler & Associates, PLLC can assist in creating, maintaining, and updating documentation across many different areas of business.

Strategic Entity Formation

When you’re starting your business, one of the most important decisions you have to make is what kind of business it will be. You need to consult with an experienced entrepreneurial law attorney to understand the differences between the three types. Each corporation type has to deal with tax and liability implications differently just to start.

  • Corporation – The most common type, also known as a C-corporation. This is a legal entity owned by private or public shareholders. In this instance, liability for your business’s debts, if you have any, is limited based on the amount of money each shareholder has invested into the business. This type of corporation is for corporate-level businesses and must file and pay taxes as such. If your business grows and becomes corporate level, you have to adjust your tax tiling and pay later on.
  • S-Corporation – This is similar to a C-corporation with special tax status. This status allows the company profits and losses to “pass through” the business owners and be reported on the personal tax returns of individual shareholders. Businesses consider this type to avoid corporate taxes and allow business owners to offset their taxable income. There are limitations on what businesses can apply to be considered S-corporations and can be best explained by an entrepreneurial law attorney during consultation.
  • Limited Liability Company (LLC) – This type of business combines the liability limitations of corporations and tax treatments for partnerships to avoid being taxed at the entity level. This is where many small businesses sit. In this type of business, taxes are paid on the individual level while profits and losses are reported on the owners’ personal tax returns.

Founder and Partnership Agreements

A founders’ agreement is a contract between a business’s founders, detailing each individual’s rights, responsibilities, liabilities, and obligations for as long as they hold these positions. This agreement is designed to protect the interests of the business and the individual interests of each founder and memorialize them. This agreement also works to finalize the business’s structure, in terms of revenue and operations. This will put into writing who owns the business and how much of it they own to avoid the risk of a lawsuit later.

Financing

Assuming financing does not come from one’s pre-established wealth, it has to come from some type of source. Wherever it comes from, there must be legal procedures and agreements to hold people accountable for what they give, receive, and spend.

  • Angel Round Financing – This is a typical sourcing technique to get a new company off the ground. This is when funding comes from individual investors or investor groups, made up of family, friends, and associates.
  • Crowd-Sourced Financing – This is when a large number of investors invest small amounts of money to help create start-ups and small businesses. Crowd-source financing does not necessitate that the investors receive a portion of the business or anything in return. Whether or not they should or have to depends on your business type, your crowd-sourcing platform, and how much you need in financing.

Shareholder and Stock Purchase Agreements

Shareholder and stock purchase agreements are signed between two parties when company shares are bought or sold. These are more commonly used by small corporations and businesses that have shares to sell. The business or shareholders in an organization can sell their shares to buyers if their contracts allow it.

This agreement serves as a document meant to protect the buyer and seller of the shares.

Intellectual Property Protection

It’s not uncommon for businesses to own intellectual property (IP). These are ideas you create to support your business, whether it is recipes, blueprints, or techniques. To protect them from being stolen or used by competitors, you need IP protection, such as patents, trademarks, or copyrights. What type of IP you’re protecting will dictate what kind of protection you need.

  • Patents – This type of IP protection keeps others from using, making, or selling your invention.
  • Trademarks – If you have a word, phrase, symbol, or design that you use to separate your business from others, you would get a trademark to keep other businesses from appearing too similar to yours.
  • Copyrights – Protect your ownership of original works, such as literary works, musical works, graphical works, and more from being copied or distributed without your permission.
  • Trade Secrets – These protect formulas, processes, devices, or other business information that gives your business a leg up or allows it to operate.

Dissolving or Converting Entities

When you purchase or merge with another business or a significant asset, you need to complete a legal process breaking them down or converting them to your business. You need to update and account for:

  • Changes in your taxes
  • Potential severance agreements and packages
  • Prior contracts with business partners and suppliers
  • New leases or property valuations
  • New employees
  • Potential layoffs
  • And more.

Customized Corporate Bylaws and LLC Operating Agreements

Possibly the most important document for a business’s long-term success, this agreement provides strategies and procedures to complete your business’s current short-term and long-term goals.

Without a business’s personal operating agreement, you have to operate based on default rules and assumptions based on state laws, if your business acts with regulated purpose at all. This is not only to provide a fiduciary duty for the members of your business but to keep it on track towards success.

Separation Agreements

Employees will come and go, either by their choice or that of the business. It’s important to properly word and detail agreements employees and employers sign when they agree to separate. This will provide benefits for the employee and provide safety nets for the business.

These agreements can include things like severance packages, non-disclosure agreements, the reason for termination, or lack of reason.

Commercial Leases

You have to have someplace to run your business, and if you don’t own a property, you must rent or lease one. Leasing a commercial property is a different animal from leasing a residential property, necessitating the guidance of an entrepreneurial law attorney.

When you sign a commercial lease, you need an attorney to help you take into account:

  • Incidental expenses – Rent isn’t the end of what you’ll be paying. You’ll also have to cover property taxes, insurance, utilities, maintenance, common area costs, and repairs.
  • Common area maintenance – Fees for snow removal, janitorial services, landscaping, and property maintenance. These are usually shared by all tenants leasing on a property.
  • Gross rent or modified gross rent lease – Your landlord may offer you the option to pay off your base rent for the year and even incidental expenses upfront, or agree to pay all your base rent for the year and share incidental expenses.
  • Net lease – Where you pay one, or several incidental expenses regularly with your base rent. This can be only property taxes in your rent, or property taxes, utilities, and/or insurance in your rent.
  • Percentage rent lease – Type of lease where you pay a base rent and pay a percentage of your gross sales over a certain minimum to the property owner. This is most common in multi-tenant retail locations and malls.
  • Tenant improvement allowance – This is a cash allowance offered by your landlord to pay for renovations to a leased space. How much money you get per square foot would be detailed and checked over by an entrepreneurial law attorney.
  • Tenant inducements – Incentives a landlord offers to encourage you to rent a space, like several months of rent for example.
  • Trade fixtures – Items and devices you bring in and can take when you leave that allows you to operate your business. These need to be defined so your landlord can’t try to claim them as part of the property you’re leasing.

Buying and Selling a Business

An entrepreneurial law attorney can assist you in appraising the business you’re aiming to buy or sell and what assets and IP are included in the purchase. We can also help write contracts detailing what is included in the payout, such as cash amounts, shares, or property to complete the purchase.

Joint Venture Agreements

This is when two parties or businesses come together in an agreement for a specific business venture. This doesn’t mean that the businesses stop being two separate entities, but act as one on this project.

A contract is needed to detail the responsibilities of each party and the ownership of the product that follows afterward. This will also affect how each entity splits revenue from the project.

Loan Promissory Notes

Before signing or agreeing to any loan, you will receive or need to create a promissory note. This is a legally binding contract that details how much you’re receiving in the loan, how much the lender is receiving based on interest rates, repayment obligations, and how the lender can proceed should the borrower not pay back the loan.

Confidentiality Agreements

Sometimes called non-disclosure agreements or NDAs, these are for any partners, employees, ex-employees, samplers, or contractors who will have access to sensitive company information. This legally binding contract details how much they can say about their experience and knowledge of the project, service, or product the NDA is for.

An NDA cannot keep a person from reporting activity that is dangerous to their person, an employee, or the public. It also cannot keep someone from reporting anything illegal. They can allow someone to speak a little about a product or service for the purposes of marketing.

Independent Contractor, Consulting & Client Service Agreements

When deciding to bring in independent contractors, consultants, or clients who will be with the business temporarily, an agreement must be made detailing what benefits you offer, what they offer, and what responsibilities you have both decided to fulfill.

Partner Disputes and Forced Buyouts

As a business’s infrastructure changes, so can its business model and personnel. This can lead to partners, co-founders, and shareholders disagreeing on a business’s future. When this happens, sometimes the disagreement is irrevocable, and for the business to continue, someone must leave.

When this happens, the minority party can agree to be bought out of their shares and ownership of the business, or just their ability to make decisions. If this doesn’t happen, there may need to be a forced buyout.

This leads to the majority forcing the minority to sell all of their shares in the company under the context of a company-wide buyout. Previous contracts can prevent this from being possible or make it easier depending on the circumstances. This makes it necessary to have an entrepreneurial law attorney who understands how the business has operated until the forced buyout.

Contact the Tennessee Entrepreneurial Law Attorneys at Tressler & Associates

Many of the important legal aspects that go into running and operating a business may not seem like a priority to a new business owner or even one who has operated successfully for some time. Eventually, there will be an issue or business venture that requires documentation and contracts to be in place already.

Don’t let your business be caught unprepared without the infrastructure it needs. Contact the Tennesse entrepreneurial attorneys at Tressler & Associates, PLLC in order to make sure you’ve built everything your business needs and are prepared for everything it will need in the future.

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