We Are Business Specialist Attorneys
As a progressive business solutions provider, Equity Legal assists individuals and businesses with a wide variety of business transactions. This includes corporate entity formation, consulting on employment issues, technology licensing, managing and protecting intellectual property, and venture equity/debt financing. We understand that business transactions drive a company’s bottom line, and our transactional attorneys will always provide competent and trusted legal advice, guidance, and representation. The counsel of our transactional attorneys can help reduce the risk of future legal problems by offering sound legal advice in advance of potential complications.
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From Corporate Formation, Leases, To Buying & Selling A Business, We Have You Covered.
We Are Business Transaction Experts
In need of guidance on how to sell your business? Or What about selling your business? Or How about starting your business? We can assist you with corporate formation, business due diligence, acquiring a business or selling a business, leasing contracts, and overall business guidance on how to reduce risk for your longterm success. We are specialists when it comes to protecting your equity, and look forward to assisting you.
We Are Your Business Transaction Attorney Specialists.
From corporate formation, to buying & selling a business, we can assist you on any business transaction situation. We help reduce long term risk, while providing guidance to protect your equity.
What We Do
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Choice of Business Entity and Capitalization Structure
The factors that are used to set up a capitalization structure include the following:
The Amount of Risk
When you exclude risk, business risk encompasses the general risk involved in the running of a company. The greater the risk, the lower the optimum debt ratio. For example, when compared to a retail apparel operation, a utility company has a more stable stream of earnings.
The retail company’s earnings may vary because its sales are driven by fashion trends. Therefore, the risk for the retail company is higher. As a result, the optimal debt ratio is lower for the apparel store, which also makes investors feel better about the firm’s ability to meet its capital obligations.
Flexibility encompasses a firm’s capacity to raise capital during bad economic times. It is naturally easy to raise capital when a company’s earnings are strong and the sales are on the rise. However, a company that has a lower level of debt—regardless of the current economy—has more financial flexibility.
The Tax Exposure of the Business
Because tax payments are deductible, using debt to finance a project is attractive as the deductibility of the debt safeguards some of a company’s income from taxation.
Styles of management can range anywhere from conservative to aggressive. The more conservative the style, the less likely the company is to use debt to increase earnings. On the other hand, an aggressive management style may employ substantial amounts of debt to generate a company’s growth and earnings per share.
Conditions in the marketplace have a significant influence on a firm’s capitalization. For example, a firm that needs financing for a new plant may have to borrow at a higher rate of interest if the market is limited, or investors are restricting the access to capital. In this case, it may be better for a company to borrow money when market conditions return to normal.
When a firm is in a growth phase, it usually attempts to finance the growth through debt. If the revenue is not stable, a high debt load can prove to be bad for a firm’s future. Firms that are mature and stable require less debt to support growth because earnings are stabilized. Normally, firms of this type use their cash flow to finance projects.
Assessing the Capital Structure
By understanding a firm’s capital structure, business stakeholders can determine if the business follows good financial practices. Established companies regularly assess their capital structure. A detailed structural analysis assists companies in establishing policies, such as resource allocation, loan terms, and pricing. Capital structure optimization lowers the risk of default while increasing shareholder returns and revenue.
Establishing a Capitalization Structure and Entity
Legal firms like Equity Legal LLP understand a company’s need to set up a capitalization structure that can be easily incorporated into its operations, whether it is set up as a corporation, partnership, or limited liability company. Besides the capital structure, lawyers regularly advise start-up clients with the following:
- Entity selection
- Debt and equity financing, including private equity financing and venture capital
- Governance and fiduciary relationships
- Succession planning
- Liquidity and exit strategies
- Resolutions of stakeholder disputes
- Equity-related compensation arrangements
- Reorganizations or restructuring
- Contracts and commercial contracts
- Joint ventures
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Technology, License, Consulting, and Other Commercial Agreements
If you are a startup, you need to establish certain contracts to begin operations. The following contracts should be included when setting up a company.
This contract covers any possible business dispute that may rise with respect to decision-making, obligations, and the procedures of operation.
Assignments of Intellectual Property (IP) (Protection of Intellectual Property)
Assignments of this type make it possible for co-founders to assign intellectual property rights to a firm.
These contracts are made between an investor and company to ensure that an investor receives a share of ownership in the business in return for his or her contribution.
NDAs (Non-disclosure Agreements)
Start-up founders frequently want a potential investor to sign an NDA before he or she submits business ideas. However, many investors refuse to sign NDAs. As ideas are difficult to safeguard, the real value of an idea is in its execution and the skills of the people implementing the concept. NDAs can also be included with a general employment contract.
Employment agreements, as noted, state employment terms, such as the income, vacation time, stock options, and benefits accorded to an employee.
Customer and Service Agreements
Customer and service contracts are written for operational purposes. A Statement of Work (SOW) is used to detail the nature of deliverables and services, and is normally included in a service agreement.
License agreements allow the signer to control his or her intellectual property (IP) rights with respect to a service or software. For example, end user license agreements (EULAs) are non-negotiable agreements that specify how users may use software. Software licenses, on the other hand, can be negotiated, and therefore frequently cover custom software.
Providing Corporate Officers with Direct Accountability for their Legal Needs
Corporate accountability is designed to satisfy the demands of shareholders and the public, and to hold corporate executives responsible for their business actions. Therefore, corporate accountability reports may include feedback on employee treatment, or feature a company’s efforts toward sustainability. Business practices are gauged as well.
Legal Due Diligence Process and Review
Legal due diligence is required for the successful negotiation of contracts. You must understand the reasons for due diligence in order to comprehend the process and the purpose for a review. The reason legal due diligence is performed is to ensure protection for the buyer against misrepresentation or fraud. Due diligence gives a buyer a competitive advantage with respect to his or her purchase, and its actual value.
In addition, any information that is gathered can be used as a bargaining tool. If you discover possible problems during your search—such as undisclosed liabilities—you can use the information to negotiate a reduced purchase price. You also need to follow due diligence to competently close a business or real estate transaction.
Business Lease Drafting and Negotiations
A lease for business use can be drafted for using a building for a restaurant, office, manufacturing plant, warehouse, or retail operation. Therefore, the terms of the contract need to reflect, precisely, the requirements of the tenant and the property owner. Commercial leases should always be customized to the exact requirements of each party. Each party should also have a clear understanding of his or her obligations or rights.