One of the first questions many new business owners located in Virginia ask is: “Should I form my LLC in Delaware, Wyoming, or Nevada instead of Virginia?” My answer surprises many people. If your business is located in Virginia, the best place to form your LLC is almost always Virginia. That advice may not be as exciting as the conventional wisdom about “asset protection,” “privacy,” or “tax savings,” in those other states, but for most Virginia entrepreneurs it is the right

The Virginia Limited Liability Company Act does not require a Virginia limited liability company to adopt a written Operating Agreement. In fact, many LLCs are formed every year without one. But just because the law does not require an Operating Agreement does not mean your business should operate without one. What Is an Operating Agreement? An Operating Agreement is the contract among the owners of an LLC that establishes the rules governing the business’s ownership and oper

Today, if someone starts a small business in Virginia, there is a good chance the business will be organized as a limited liability company, or LLC. The LLC is a relatively recent invention. Virginia didn’t authorize LLCs until 1991. Understanding the history and basic characteristics of a Virginia LLC helps business owners decide on using an LLC and designing the business relationship among LLC owners. Business Owners Wanted Better Choices Before LLCs existed, most closely h

Every business relationship is unique. Your Operating Agreement should reflect the relationship you and your business partners have intentionally designed.

Starting a business is an exciting venture filled with opportunities, but it also comes with its own set of challenges, particularly in the realm of law. Navigating the legal landscape can be daunting for entrepreneurs and startups. Understanding the essential legal principles can save you time, money, and potential headaches down the road. Here are some top business law tips to help you establish a solid legal foundation for your startup. Understand Your Business Structure C

In today's complex business landscape, compliance with legal regulations is not just a necessity; it is a cornerstone of sustainable success. Companies face a myriad of laws and regulations that govern their operations, from labor laws to environmental regulations. Understanding these legal considerations is crucial for any business aiming to thrive while minimizing risks. This blog post will explore the key aspects of compliance in business, providing practical insights and

Business contracts are the backbone of any successful enterprise. They outline the terms of agreements between parties, ensuring that everyone understands their rights and obligations. Whether you are a small business owner or part of a larger corporation, understanding the intricacies of business contracts is crucial for protecting your interests and avoiding disputes. In this post, we will explore the essential elements of business contracts, common pitfalls to avoid, and p

Selling a small business is one of the most significant events in a business owner's life. It is a financial transaction and a personal transition. Owners often expect the business sale process to be hard from a legal and operational perspective, but what surprises many owners is how hard it can be emotionally. Here are common psychological challenges owners face during a sale. Feeling a Loss of Identity Many owners define themselves through their business. They have spent ye

Owners of certain businesses might hear the phrase “personal goodwill” during the sale of their business, usually from a CPA or M&A lawyer. When used properly, selling personal goodwill can be a powerful planning tool for a seller. This post explains what personal goodwill is, which types of business owners may be able to separate personal goodwill from enterprise goodwill, how a portion of the purchase price can be allocated to personal goodwill, and the pros and cons of doi

Selling a business is one of the most significant financial events in an owner’s life. It's not only a legal and operational transaction, it's also a major personal wealth event that requires thoughtful planning before the sale and disciplined management of the proceeds afterward. Adding a skilled financial advisor to your deal team can help a business owner extract the wealth they have created for their next phase in life. The right advisor helps the owner prepare for the sa

Receiving a draft Letter of Intent ("LOI") from a prospective buyer of your business can feel like a major milestone, but an LOI is more than a simple expression of intent. It is the blueprint for the entire deal that follows. The terms in the LOI will guide the purchase price and payment, due diligence, the drafting of the purchase agreement, the transaction structure, the closing timeline, post-closing transition, and the obligations each party must satisfy along the way. S

Business owners often tell me that they are resigned to closing their doors when they retire because they don't think anyone would be interested in buying their business. Many small business owners assume their business isn’t “big enough,” “interesting enough,” or “profitable enough” to attract a buyer. It’s a common and an understandable reaction. After all, you’ve spent years keeping the doors open, attracting customers, solving problems, building brand recognition and good

You've invested a significant amount of your life building your business. You've reached a point where you want or need to sell it. You might be ready to retire, your health may not be able to support the time and stress required to run a business, or you may be ready to move on to another opportunity. How do you find someone to buy your business so you can extract the wealth you have created? Who Might Buy Your Business? Small businesses attract potential buyers in the follo

The Issue : Off-the-shelf Operating Agreements don't contain provisions to help resolve three common challenges. Owners will spend a lot...

Explore legal issues of a business breakup caused by a deadlock among owners

Federal law requires employers to notify workers that their non-competes are no longer enforceable

Businesses subject to the new FTC non-compete rule must (1) no longer use post-employment non-compete agreements, (2) provide notice to workers who have existing non-compete agreements that those agreements are now unenforceable, and (3) not enforce existing non-compete agreements against workers.

I've heard some frustration from searchers, investors, and advisors about working with seller's lawyers. Most of that frustration seemed to come from sellers using lawyers who have little to no experience in small business purchases and sales.

A closing date in a contract is a goal to work toward, but you should anticipate that it will likely be extended to a later date because the buyer, seller, and their teams need time to complete all the tasks related to closing.

What you can expect of a business lawyer when buying or exiting a business. Business lawyers manage the many tasks that need to be accomplished before closing such as: drafting and reviewing legal documents, developing negotiation strategies and negotiating the terms and conditions of the legal documents, coach/advise clients through the process, and project managing the process to get you to closing your deal.