Jordan Guydon LLP

Jordan Guydon LLP Trust Jordan Guydon LLP to help your business grow through our general business law practice services. We have been in business for more than 10 years.

Jordan Guydon LLP, located in the Washington, DC metropolitan area, offers superior and cost-effective legal services for corporate, government contracts, real estate law and litigation matters for businesses and individuals. Our goal is to provide creative legal solutions that will help you succeed. We seek to develop businesses struggling with financing, dispute litigation, real estate, manpower

, and taxes. We also assist businesses in mergers and acquisitions, divestitures, ventures and other alliances.

12/04/2017

Why Should You Buy a Business?

Purchasing an existing business has numerous benefits. The company, physical location, employees, and customer base are already established, saving the buyer the time and energy required to start a new company. Buying an already established company is appealing to many individuals because it is less expensive than attempting to start up a new business. Jordan Guydon LLP can help you make informed legal and business decisions and make the process of buying a business as hassle-free as possible. We focus on providing legal assistance to buyers of businesses!

What Are the Benefits of Buying an Existing Business?

Purchasing an existing business can be less risky than starting from scratch. It usually has an established customer base, a network of professional contracts, and a financial rack record that will make securing finance easier.

An existing enterprise will require less work in, so that you can focus on growing the company, rather than getting it off the ground. You may also have an instant influx of income, as compared to continually pumping cash into a startup. Other benefits and advantages include:

 An established customer base;
 Established location;
 Easier to handle and manage from the beginning; and/or
 Comes with inventory and machinery.

What Should You Do Before You Even Consider Purchasing an Existing Business?

Before you consider buying an existing corporation, it is important to perform due diligence. A team consisting of an attorney, accountant, banker, and possibly a broker can assist you in finding and securing the right fit. There are many questions and issues to consider before you buy, including:

 Is it a good fit for what you are trying to do?
 Legal and ownership structure?
 What debts does the company have?
 Does it have any liabilities you need to consider?
 Review the company’s inventory, furniture and fixtures, and legal documents such as charter documents and third-party contracts.

When you buy a business, aside from the income and assets you also take on the company’s debt. While it may seem to make a good profit, it can also be eaten up if it is riddled with debt. If you have the money to pay the debt, then your new venture may thrive. It all depends on your situation and whether or not you can afford to not just purchase the company, but also accept its burdens.

Questions You Need to Ask About the Existing Business.

There are many important questions to ask before purchasing a business. The following is a partial list of important due diligence considerations:

 Why is it for sale?
 What does its future look like, and why?
 How does it market itself and attract customers?
 Has the company changed?
 Is there pending litigation against it or the owners?
 What about contracts, particularly government contracts?

Other important inquiries include information pertaining to leases, licenses, tax liabilities, patents and trade secrets.

Finally, absolutely make sure to talk to its customers and suppliers. Get as much information as possible before you decide to move forward. It is always a wise idea to get a credit report, check with the Better Business Bureau and conduct litigation/judgment/lien searches.

What to Do During Negotiations?

If you are considering purchasing an existing company, you’ll want to get the most value for your money. You will need to strategize and take into consideration several aspects to negotiate the best deal.

 Determine the company’s value.
 Come to the table prepared: Typical purchase agreements can have over fifty different clauses to negotiate.
 Prepare yourself for the “what if’s”: Know what your position and rebuttal will be on points the seller may bring up.
 Specify terms of the sale: Make sure to include anything that you feel is important.
 Make a reasonable offer: You do not have to offer the asking price, but offering a figure that is far below what is being asked may cause a seller to terminate negotiations.

Financial Past of the Business.

Before making an offer on an existing business, a buyer should thoroughly research the company’s financial history. Items examined should include:

 Certified financial and tax records of the existing company if available;
 Employee files, contracts, and benefits;
 Current and past lawsuits, if applicable;
 Any contracts the company has with other companies;
 The business’ lease(s); and
 Any other documents that will apprise you of the problems and potential of the business.

How Much Should I Pay for a Business?

Paying the right price for a company is very important. There are a number of different ways to figure out the value of a business before purchasing it. Here are a few:

 Capitalized Earning Approach: This approach determines to the return on the investment that is expected by the buyer.
 Excess Earning Method: What are all the different ways you can earn through the company?
 Cash Flow Method: Determine what the typical monthly cash flow is and whether the purchase price of the business is high or low compared to the cash flow.
 Tangible Assets (Balance Sheet) Method: How much assets come with the purchase.
 Value of Specific Intangible Assets Method: What is the value of all the assets and equipment you are purchasing.

Should You Consult an Attorney When Buying a Business?

Business acquisitions can be risky! Business acquisitions generally involve many negotiations and contracts. Jordan Guydon’s business attorneys can assist you in the negotiation process to help you get what you want for your future business. We can also help you sift through financial documents to determine what is relevant to the purchase transaction. Jordan Guydon’s lawyers can also represent the buyer in solely the real estate sales process, should the buyer ultimately wish to buy only the business’ real property. We can help secure the best deal for you, and the best possible outcome for your investment. Jordan Guydon LLP can help you make informed legal and business decisions. Contact us for a free initial legal assessment to learn how we can help you plan for success.

WE CAN HELP!

For more information or for a free consultation, please call or email Edsel Guydon at 703.865.8699 or [email protected] or call or email Daryle Jordan at 703.865.8699 or [email protected].

Please see: jordanguydonlaw.com.

09/14/2017

Business Entity Legal Structure Dilemma:
Organize a LLC or Form a Corporation?

Although creating and maintaining a corporation or a limited liability company (“LLC”) will probably be more complex and costly than forming a sole proprietorship or partnership, it may be worth it for your small business depending upon the type of work you plan on doing. Perhaps the main reason you want to organize your business as an LLC or corporation is to shield yourself from any personal liability that may arise from your small business' dealings.

Although LLCs and corporations are alike in many respects, what truly sets a corporation apart from the other types of business structures is that a corporation is its own legal and tax entity. A corporation pays its own taxes on any profits that it keeps and the owners of a corporation only pay income taxes on monies they draw from the corporation in the form of salaries, dividends and bonuses.

A LLC, just like a corporation, provides limited liability to the owners of the LLC for the business' liabilities, including debts, judgments and others. Where the LLC differs from a corporation, however, is in terms of taxes. Unlike a corporation, a LLC is not its own, separate tax entity, and the owners of the LLC must pay personal income taxes on their share of the profits that the LLC keeps during the tax year.

Organizing your business as a corporation or a LLC makes sense in two situations. First, if the business is engaged in a dangerous activity that makes it more likely to be sued, or if the business has the potential of racking up large amounts of debt, then a corporation or a LLC may be a good idea to shield the owners from personal liability. Second, if any of the owners of a business have large amounts of personal assets that they want to shield from any potential liability associated with the business, a corporate or an LLC could be the best option.

Deciding whether or not to form a corporation or organize an LLC is an important choice to make when starting your new business or reorganizing your existing business(es). Other types of business legal structures include sole proprietorships (which are very limited in scope) and, partnerships (which do not provide the same protections from personal liability). Each legal structure has certain advantages and disadvantages. Whatever type of legal structure you decide to use, the decision ultimately should at least be based upon consideration of the below factors and a careful analysis of the nature and needs of your business. Following is a comparative discussion of certain key pros and cons of forming a corporation versus organizing an LLC.

FORMING A CORPORATION

PROS

Owner Protection from Legal Liability: Once a new business's owner(s) successfully completes the incorporation process, the owner(s) have a limited amount of legal liability for the corporation's business activities and debts, because in the eyes of the law the corporation is a separate entity. In order to maintain this limited liability, the corporation's owners must follow a number of legally required corporate formalities.

Ability to Attract Large Number of Investors: The corporation's ability to issue stock is a strong selling point to those willing to invest capital in a business venture.

Power Structure: The corporate business form has an established power and management structure – i.e., directors, officers, and shareholders. Each group has its own set of legally defined roles and responsibilities within the corporate framework. An elected Board of Directors manages the corporation's business affairs; the officers execute the Board's directives and run day-to-day operations. Shareholders receive reports regarding the financial status of the corporation and receive dividends without having to provide any labor or input.

Certain Benefits to Shareholders: Because of the setup of a corporation, the business will probably be able to deduct the costs of the health insurance or other paid benefits from its profits, and the benefit provided to the employee is not considered income. This is a great benefit of forming your business as a corporation. To contrast, an LLC can only deduct a portion of the cost of the health insurance (and other benefits) premiums paid for the employees.

Stock and Stock Options for Employees: Especially for larger businesses, the corporate business structure offers an appealing opportunity to retain employees and attract potential employees -- stock benefits and stock options (the employee's right to buy stock at a locked-in price).

CONS

Time and Cost of Incorporation: The incorporation process can be expensive and time-consuming. A number of documents must be prepared (including the new corporation's articles of incorporation and bylaws), and filing and other periodic fees must be paid to your state's Secretary of State office (or similar business filing agency).

Following Corporate Formalities: All corporations are required by law to observe a number of corporate formalities to ensure that the corporation is operating as a separate entity, independent of the business's owners. These steps include holding regular meetings of directors, keeping records of corporate activity, and maintaining the corporation's ongoing financial independence. Only shareholders who are also officers or directors have any role in management of the corporation. If shareholders dislike the direction the corporation is taking, it is very difficult to have any impact on changing that direction.

Potential Tax Liability: The profits from traditional corporations may be "double taxed." That is, the corporation itself is taxed for any profits earned, and any individual stockholder who earned profits from the corporation (in the form of paid "dividends") are also taxed. This occurs most often in larger corporations, and may not be an issue for stockholders and owners of smaller corporations, who often work for the business itself and are paid salaries (which are tax-deductible for the corporation) rather than dividends. One solution to the double-taxation problem is electing "S" corporation tax status.

ORGANIZING A LLC

PROS

Flexible and Simple Management Structure: Many small businesses may find that the flexibility and simplicity of a LLC makes it the better choice when it comes to forming as a corporation versus an LLC. The members of a limited liability company either manage the business affairs of the company themselves or appoint a manager to operate the company. No group of individuals stands between the members and the managers (like a Board of Directors in a corporation). There is a great deal of flexibility in determining a management structure for the company; and the members can adopt a structure best suited to the particular needs of the company.

No Double Taxation: A LLC may elect to be treated like a partnership for income tax purposes. If this election is made, then all income is taxed proportionately to each of the partners who report it on their personal tax returns and the LLC is not taxed as a separate legal entity. Nevertheless, active members are subject to self-employment tax for Social Security and Medicare. If you plan on your business owning property, you will seriously want to consider forming your business as an LLC to avoid the problem of double taxes.

Versatile Tax Attributes: The business profits and losses can be allocated to the owners along different lines than ownership interest (for example, a 10% owner may be allocated 30% of the business' profits). Owners can choose how the LLC will be taxed, either as a partnership or a corporation.

Owner Protection from Legal Liability: Owners (i.e., “members”) of the business enjoy limited liability for the business' debts, judgments and other liabilities, even if the owners engage in significant control of the business.

CONS
Higher Costs: More expensive to establish than a sole proprietorship or partnership.

Potential Limitations on Raising Capital: Although LLCs work great when there are only a few owners of a business that expect to have a hand in the dealings of the business, the LLC structure starts lacking when the number of investors and owners increases.

Employee Retention: Unlike a LLC, a corporation has a great incentive system built directly into the structure of the business that can help small business retain great employees. Corporations can offer their best employees stock options that, in addition to providing an incentive for employees to remain with a business, also provide an incentive for an employee to continue working diligently for the business. Offering these stock options is an easier way to get employees a membership interest in the business, unlike LLCs where it can often be difficult and complex to get employees into the ownership/membership circle.

Potential Control Issues: Subject to agreement, each member may have rights in management and may contractually bind the company. The possibility of disagreement and voting deadlock exists.

STILL UNSURE ABOUT WHETHER TO INCORPORATE A CORPORATION OR FORM A LLC?

The type of legal structure you choose for your business will play a huge role in your success (or failure), so it pays to do your homework before deciding. Ultimately, you and your business associates will have to make that decision for yourselves, but Jordan Guydon LLP can help you make an informed legal and business decision and make the process as smooth as possible. Contact us for a free initial legal assessment to learn how we can help you plan for success.

WE CAN HELP!

For more information, Please call 703.865.8699 or email [email protected] or [email protected] or see: jordanguydonlaw.com

09/14/2017

So You Want to Be or Are a Small Business Owner?

Transitioning from a sole proprietorship to a legal entity structure (whether a corporation, limited liability or partnership) can be a daunting task without appropriate legal assistance. Small business owners must understand how various laws will affect employment matters, taxes, insurance and contractual relationships with other parties. The type of legal structure you choose for your business will play a huge role in your success (or failure), so it pays to have competent and affordable legal advice. Ultimately, you (and your business associates) will have to make that decision for yourself (yourselves), but Jordan Guydon LLP can help you make informed legal and business decisions and make the process as stress-free as possible. We focus on providing legal assistance to start-up and small businesses!

Jordan Guydon LLP’s business attorneys can:

Set Up Your Business, and explain the differences between the various types of legal entities, the tax treatment of each type and recommend the appropriate legal entity structure based upon your short and long-term business objectives.

Explain Employment Laws, and discuss the legal requirements of having employees, including hiring and firing employees; fair employment laws; wage and hour laws; wage withholding; worker's compensation; unemployment insurance; and OSHA compliance.

Discuss Contractual Relationships, and explain the basics of business contracts law and the relevance of standard business contract provisions. We will also discuss the implications of entering into a joint venture or other contractual relationships with another business.

Provide Guidance for Government Contracts, and explain the requirements to participate in various preferential programs available to small businesses seeking to do business under contracts which are funded by the Federal government or a state government. We will also explain what additional responsibilities a small business must assume and duties it must perform generally in accordance with the terms of government contracts, including legally mandated regulatory recordkeeping and reporting requirements.

Recommend Risk Management Strategies and Provide Accounting Assistance, and explain the basics of insurance coverage, including general liability, worker's compensation, directors’ and officers’ insurance, and business auto insurance. We will also discuss strategies and best practices to prevent lawsuits and how to protect your business against potential litigation. We will address basic accounting and fiscal control matters and, if necessary, refer you to a network of accounting professionals who regularly assist small businesses with setting up accounting systems and tax related matters.

Still Want to Be a Small Business Owner?

The rewards of being or becoming a small business owner are many. Proper planning and the assistance of competent and affordable legal advice will play huge roles in the success of your business. Jordan Guydon LLP can help you make informed legal and business decisions. Contact us for a free initial legal assessment to learn how we can help you plan for success.

WE CAN HELP!

For more information, please call 703.865.8699 or email [email protected] or [email protected] or see: jordanguydonlaw.com

With more than 10 years of experience, our attorneys provide legal solutions that will help your business succeed. Call ...
07/13/2017

With more than 10 years of experience, our attorneys provide legal solutions that will help your business succeed. Call (703) 865-8699 for a free consultation!

Trust the experienced attorneys at Jordan Guydon to help grow your business through corporate law and practice services!...
07/06/2017

Trust the experienced attorneys at Jordan Guydon to help grow your business through corporate law and practice services! Call (703) 865-8699 for a free consultation.

From startups to corporate companies, we help to develop businesses struggling with financing, dispute litigation, and m...
06/29/2017

From startups to corporate companies, we help to develop businesses struggling with financing, dispute litigation, and more. Learn more about our services at http://jordanguydonlaw.com/practice-areas/ today!

Take your business to the next level! We offer corporate law and practice services, including litigation, mergers and ac...
06/22/2017

Take your business to the next level! We offer corporate law and practice services, including litigation, mergers and acquisitions, securities, and more. Visit http://jordanguydonlaw.com/practice-areas/ for more information.

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Trust Jordan Guydon LLP to help your business grow through our general business law practice services. Jordan Guydon LLP, located in the Washington, DC metropolitan area, offers superior and cost-effective legal services for corporate, government contracts, real estate law and litigation matters for businesses and individuals. We have been in business for more than 15 years. Our goal is to provide creative legal solutions that will help you succeed. We seek to develop businesses struggling with financing, dispute litigation, real estate, manpower, and taxes. We also assist businesses in mergers and acquisitions, divestitures, ventures and other alliances.