Business Organizations

Lawsuit on a dissolved business unit

NovaXTNT — Wed, 18 Nov 2009 15:37:04 GMT

Hello,

We, retail shareholders are facing a specific situation with a business unit (here by referred to as X) that went through a plan of dissolution and liquidation of its assets comprising non-IP assets and very valuable IP assets. There was certain amount of cash-on-hand-left at the end and was recently distributed.

X company were able to sell all its assets to a single buyer though with a clever 'closed bidding' process hiring a mediator company. However, X company did not release any news on the sale, who the buyer is and what were the transaction terms.

We believe IP assets are worth 10's and 100's of millions of $$$ however X legal counsel denies it and would not release news either and has been over a month now.

We, retail shareholders, suspect that X company's management probably formed another company (referred to as Y) outfit and bid for X company's assets and steal valuable IP assets from retail shareholders and taking all their shares to this suspected Y company.

Now, my question is what is the best approach to confront this in court of law if that suspected scenario becomes true ? In that case, can we include 1) Dissolved company X, 2) New company outfit Y, 3) Mediator company (referred to as Z) facilitated the sale, 4) Partner companies(a, b, c) in company Y in the litigation?

Since it would only be an allegation without evidences to start with, could this stand in court of law and so request court to appoint independant arbitration/investigation to wet all the deals and scrutinize them?

All am looking for is the best practice/approach to form solid base for a law suit to bring justice incase of any fradulent activity suspected with companies X, Y, Z and a,b,c.

Advanced Thanks

Nova

LLC partner no longer included in Operating Agreement

TexasLoneStarBoy — Sat, 14 Nov 2009 09:44:12 GMT

Just less than a year ago my brother and a friend formed a LLC with an idea for a business. When they sought financing all of the lenders they approached would not finance the business as long as the friend was a member of the LLC. My brother and his friend agreed to remove the friend's name from the Operating Agreement to acquire the appropriate financing and at that time pulled in 2 additional partners to bolster the needed credit. Before the business opened its doors, the friend was involved in planning the business but contributed nothing monetarily. As the grand opening approached, the friend became less and less involved until the point now, where the business has been open for 3 or 4 months, he considers himself more of a silent partner.

They have yet to realize a profit and each month scramble to pay their employees, lease and loans. My brother and the two added partners subsidize the business with their own money each month but the so called friend has yet to contribute anything monetarily and at this point contributes little or no time to running the business.

Next month they project they will have their first profitable month and the friend is insisting that he is entitled to an evenly divided percentage of the profit while the other partners have agreed to use the profit to pay down business debts. At this point in the process, the only place that the friends name appears to be attached to the business in any way is on the building lease. He is not on the LLC, he has no liability for the business loans and he has contributed no money to the operation. His only contribution to the business at this point was the initial planning. He is claiming that his "idea capital" is worth every bit as much as the time and money the other partners have put into the business. My question is this (sorry for the long explanation): If the other partners tell him that he is no longer a part of the business, can he claim some sort of compensation or continued ownership based on his perceived "idea capital"?

Non-Profit Organization in a For-Profit Business?

mike727360 — Fri, 30 Oct 2009 18:14:50 GMT

We are a small publication for Pharmacy Buyers. We've recently been in discussion to form a professional organization for Pharmacy Buyers.

Is it possible to create a non-profit professsional organization within the for-profit publication?

Pennsylvania Law on Non Profit Organization Raising Money

Heather L Rabold — Sun, 25 Oct 2009 00:44:19 GMT

I am a board member of a non-profit preschool in Pennsylvania. We have moved to a new location and are currently trying to raise $440,000 for the construction of the new school. We sent out a captial campaign brochure on the school and our mission for our students and the school. We were told by the state that we were not allowed to ask for money. Who do I need to talk to or fill out paperwork to allow us to ask for money?

Leave Corporation in MN or reorganize in NY?

Jammedia — Fri, 23 Oct 2009 18:15:29 GMT

I'm a graphic designer who either works from home or travels with whatever company is hiring me this week. I work for lots of companies both in MN, NY and other states. I originally incorporated in MN because that's where I lived. Now I have moved to New York and have been running my business through my MN corporation. Do I need to move my corporation to NY? I still hold a MN driver's license. Is there any tax advantage to moving? Because companies pay my corporation they don't seem to care where it is located. Any advice would be helpful.

I do not have a physical office either in NY or MN. I just work wherever I happen to be.

forming an LLC

Lynn5 — Tue, 20 Oct 2009 01:05:28 GMT

II just inherited a small portion of the property, but have been handling the transactions for 2 years. The land is operated by a farm company locally so it isn't much work.

I have just spent $2000 tto draft a partnerhsip agreement, but then all he did was charge me that much to tell me that it would be better to form an LLC rather than a family limited partnership to handle a 20 acre farm in california that has been in operation for decades. My lawyer has presented me with absolutely nothing for this money. I am thoroughly disgusted. i could have researched it myself without the law degree in as much time has he charged me for his "services"

Enough dissing the ripoff, sorry for the digression.

The lawyer stated I could form the LLC in California (the location of the property) or in Pennsylvania (where I live). Is this correct information? It looks much cheaper to do it in PA. Twoof the members of the LLC live in CA, I live in PA, and one lives in WA. Can I really form this in a state besides CA?

Second question: I would like to draft a boiler plate operational agreement for the LLC members (all family members) and have it then run by a lawyer, which will save us another $2000 in legal fees. Considering the property nets us about 10K-15K per year, I don't want to waste any more money on laywers than I have to. What problems are there in doing this, as opposed to a lawyer drafting the agreement?

Doing a raw meat co-op. How to proceed?

Steph Sorensen — Fri, 16 Oct 2009 13:59:46 GMT

I have recently contracted with a company that has initiated a program where wildlife sanctuaries, animal rescues, and members of the public can be vendors for a particular large retail chain and basically act as their disposal agent for all of their meat and produce that has gone past the expiration date. The meat is for animal consumption only, and each person that signs the contract is covered under an umbrella insurance policy that covers any liability issues.

For around $100 a month, I will be picking up all expired meat from a particular store on a weekly basis. I have a few people lined up that also want some of this meat. I plan on charging a "handling fee" on a lbs/month basis, since it is illegal to sell it. The people who initiated the program informed me I could do it this way. I will still have a ton more meat than will be used by the few people I have interested so far, so the remainder will be donated to rescues, zoos, or any other charitable organization that has animals that need it. I can honestly say that the majority of what I pick up weekly will likely be donated to rescues.

My question is, how can I register this entity so that I can write off the expenses of doing this? It will cost me way more in expenses than the measley handling fee I am charging people for the meat. Would I register as a non-profit? Please help me figure out what I need to do to get this set up correctly!

Thanks,

Steph

Legal Liability being named President of an S-Corp NC

BobSexton — Sun, 04 Oct 2009 16:20:46 GMT

I work for a international company based in the Netherlands. We operate in the USA (VA) as an S Corporation. If they name me as President of the US Corporation, what liability exposure do I assume? Is it customary for a company to offer compensation as being named President of the corp?

Thanks in advance for your replies

Removing partner ..no article of organisation...

billu — Fri, 09 Oct 2009 13:12:39 GMT

Hi :

A couple of friends and I formed an LLC a couple of months ago to start a company. We have not done anything yet. Meaning we have no article of organisation and really have not done anything with the business. I am the resident agent for the business and everyone else merely signed on the paperwork. ( We are in Maryland ) . Now, one of the members isn't really participating and I don't see him contributing in the future.

Now, I am going to start doing somthing with the business but want to see what the best way to remove him from the LLC is. Can I simply send in an amendment for the registration papers?

Thanks

LLC or S-Corp?

Lou_82 — Thu, 24 Sep 2009 19:12:10 GMT

Hi, I am looking to start up an e-commerce business. Basically Ill be selling a whole assortment of products online. In order for me to establish a relationship with wholesalers they'll want to see that I am a legal business and that I have a Tax ID number.

I am looking to incorporate myself and from research it appears my two options are either an LLC or an S-Corp, but I am not sure which one to choose. The business will be all mine, ill be running it from home with no employees. I am looking for the best combination of protection from liabilities (i want to be protected in case a customer gets injured using a product I sell) and tax benefits. An LLC appears to be the easiest to start up, but it appears that you get taxed a lot more than an S-Corp, but an S-Corp supposedly is a lot of paper work (though websites like Hubco seem to make things a lot easier) and i am also reading that I will have to establish a board of members, shares, and all that other stuff which confuses me since it'll just be me.

So based on what I am looking to do what is recommended I incorporate as, a LLC or S-Corp?"

Thank You in advance

I think my brother has been taken advantage of...

AlexBlue — Sun, 20 Sep 2009 19:02:21 GMT

My brother presented a business plan and a customer database of 200+ to an investor (very wealthy lottery winner) to open a tavern/bar. Since my brother does construction and has been a bartender for many years in our area (Texas) he not only developed the concept/dba and found the location (based on demographics) but also did the build-out for the investor. The agreement was that he would use his industry (both construction & bar) knowledge to build the bar, set up the vendor accounts, do the design/decor based on his concept, build the customer base up prior to opening and then manage the operational aspects upon opening. The agreement was that he would be paid a dollar amount for the build-out, and have 10% ownership with the option of reinvesting his buildout pay to earn another 10% of ownership. Well, the bar has recently opened, is doing fantastically, and the family of the investor has gotten heavily involved - which wasn't the original plan - and after disagreements about operational details my brother has learned that the share documents were never fully processed, therefore the only owner is the investor's wife. My brother has no legal document supporting his ownership, only their word over the six months the business was being built. Today, he is working tirelessly at the bar, continuing to drive business - I'd speculate that 60% of the customers are there because he knows them, or by association to him. The owner is saying that they will only pay him the remainder of the build-out. He had expected his profit share check at the end of every month so without any agreement set and no lawyer of his own he is actually working 60 hours a week now with no idea as to how, what or when he will be paid anything. He has put blood, sweat and tears into the business and used his name (as an "owner") to bring people in, and now he feels humiliated (they have been nasty to him, in front of customers that believed he was an "owner") and confused as to why they are not living up to the original agreement. Now that the bar is finished, and successful, they act as if he didn't have much to do with it at all - I am rational person and I saw it all happen. This was his dream, and he worked at it with passion and enthusiasm, not only for himself but for them - because he trusted, and liked, the investor. I want to help him and would truly, deeply appreciate any guidance. Thanks so much.

How to designate a President in an LLC?

jrry660 — Mon, 07 Sep 2009 18:44:40 GMT

I have an LLC in Washington DC. It is a member managed LLC with me being the sole member. What is the wording or phrase that I need to add to my operating agreement that would allow me to become the President of my LLC and give me the title of President?

Getting out of LLC with no operating agreement

Ken Bo — Tue, 25 Aug 2009 14:11:41 GMT

Hi, I am in an internet business with two other partners. We formed an LLC a couple years back and now I am trying to exit because I no longer believe the business will be the money maker that we thought it once was.

We do not have an operating agreement and I wanted to know what I must do to either get rid of a majority of my shares (sell, giveaway, transfer, combination of all three) and if they can force me to do this without my consent.

I don't want to be the partner that doesn't stay invoved but just takes a check but I also want to make sure that I am not forced out for lack of involvment.

Church transactions

Beccie — Sat, 22 Aug 2009 12:51:16 GMT

My church bought a church property from a previous church 15 years ago. It turns out that the title was never change from Church A (the seller) to Church B (the buyer). Church B pays the mortgage directly to Church B. The question is, since churches are suppose to be non-profit organizations, can they engage in this type of arrangements. Wouldn't the mortgage be considered profit, if they receive more than what the mortgage actually cost. wouldn't that put their non-profit (501(c) 3 status at jeopardy? Also,in a situation like this, shouldn't Church B have the title if it's a purchase arrangement. Please advise.

California Statement Of Information Form (llc-12)

Tabi — Sat, 28 Mar 2009 22:23:38 GMT

Hi,

I am starting a single member LLC in California. On the LLC-12 Statement Of Information form for California (http://www.sos.ca.gov... it asks for my business or residential address in sections 4-7:

COMPLETE ADDRESSES FOR THE FOLLOWING (Do not abbreviate the name of the city. Items 4 and 5 cannot be P.O. Boxes.)

4. STREET ADDRESS OF PRINCIPAL EXECUTIVE OFFICE
CITY AND STATE
ZIP CODE

5. CALIFORNIA OFFICE WHERE RECORDS ARE MAINTAINED (DOMESTIC ONLY)
CITY
STATE
CA
ZIP CODE

NAME AND COMPLETE ADDRESS OF THE CHIEF EXECUTIVE OFFICER, IF ANY

6. NAME
ADDRESS
CITY AND STATE
ZIP CODE

NAME AND COMPLETE ADDRESS OF ANY MANAGER OR MANAGERS, OR IF NONE HAVE BEEN APPOINTED OR ELECTED,
PROVIDE THE NAME AND ADDRESS OF EACH MEMBER (Attach additional pages, if necessary.)

7. NAME
ADDRESS
CITY AND STATE
ZIP CODE

Can I use an attorney's address for these sections? I don't have a business address yet and I don't want to use my personal residence.

Thanks

Nevada Corp? Delaware? I just need anonymity.

Gabby1980 — Wed, 12 Aug 2009 15:01:43 GMT

I am a 1 man band that needs the following:

Anonymity- (I do not want searches to reveal I am the owner due to possible conflict of interest because I will be seeking additional employment)

Ability to sell shares to raise funds (ideally, in the future, as I grow to simply offer investors equity in the company)

I do not need funds just now but, again, want to know if this is possible.

I know I need to consult with an attorney; please share your thoughts and experience.

Thank you

Hi Kaye O Campbell-

Sharon - Community Moderator (Admin) — Mon, 10 Aug 2009 01:41:56 GMT

Welcome to the Forums!

I removed your post because it was a duplicate of the post in the Civil Rights Forum. We try to avoid repetition and parallel discussions for our respondents that read across the multiple Forums.

Thanks for your cooperation with future posts.

Sharon

exchange of unit with samsung

tommy34 — Wed, 22 Jul 2009 23:03:18 GMT

I purchased an home theather unit htz 310aa from samsung in november 28,2008, the unit stop working it was send to samsung repair facility in new jersey for repair, when it was returned to me it was damaged, i call samsung and informed them about the damamge unit the e-mail me an prepaid label to send the unit back to new jersey, I shipped the unit on june 11, 2009 it was delivered to samsung repair facility on june 12, 2009 at that point i was informed by customer service that a mew unit will be shipped to me in 7-14 days, I still have not received that unit. I call samsung many times inquiring about my unit, then on june 30,2009 the told that a new unit is being ordered and in 7-14 days i will received my unit it is now july 22, 2009 and still i have not received my unit. Samsung 7-14 days policy has already passed by 7 days and the unit have not arrived at my door. I would like to know what steps I can take against samsung since they have failed to stand by thier exchange policy.

&nbs... Thank You

Non-Profit 501(C)(3) 509(a)(1) Gaming

Squintz — Mon, 13 Jul 2009 22:18:28 GMT

I have incorporated in the state of Maryland as a Non-Profit, Tax-Exempt Corporation. I am working on my IRS Form 1023 for my 501(C)(3) 509(A)(1) status and I'm not sure how to answer Part VIII question 3a which ask:

"Do you or will you operate bingo or gaming activities? If "Yes," describe who conducts them, and list all revenue received or expected to be received and expenses paid or expected to be paid in operating these activities. Revenue and expenses should be provided for the time periods specified in Part IX, Financial Data."

The organization is for educational and scientific purposes. The idea is that it's a place where people can go to learn about science and technology and use the tools and resources at the place. Voting members will pay dues of $50 but anyone is welcome to use the facilities and learn at the events and classes. www.harfordhackerspace... for more information.

I want to hold fundraising events to help fund the operation of the organization. One of the ideas I had was to throw an annual bull roast and having paddle wheel games for entertainment and to help raise money. Also, I would like to solicite companies and hold raffles using items that I receive from those companies.

I'm assuming that I should check yes to the above question. Is that correct?

Also, being that I am in Maryland who would have to conduct these games? How would I find a legit company to run the gaming?

Any additional advice for the Form 1023 application is appreciated.

David

Copies of employee's state driver's license

djohn81281 — Wed, 24 Jun 2009 15:41:08 GMT

Hi. I work on Ft. Campbell KY for a company out of Ft. Worth TX. Part of the post is in Tennessee also. Anyway, I have a legal requirement to verify my employee's have a valid driver's license to operate U.S. Government vehicles (AR600-55). ISO 9001requires objective data (documentation) to prove it. We protect our employee's personal information and, in fact, the same office has all the medical information relating to on-the-job injuries. But I still have employees fighting this, insisting that we have no legal right to have an actual copy of their driver's license. I have been unable to come up with any information regarding this issue to support either argument.

LLC first or INC first

catherineket — Wed, 10 Jun 2009 21:34:53 GMT

My partner and I want to start investing in real estate but we are not sure how we want to structure our business. We are going to consult with an attorney and cpa before we proceed but any advice will be good. Our long term goal is to have an asset holding and management company. we want to turn our properties into assets with little to no liability. We also want to have the liberties to venture outside of real estate into other business opportunities but have our parent company own all these things. We want to remain privately held. the question is we acquire our first property, do we buy that as the holding company that manages house1, LLC? i'm kind of confused as to how to structure. Please advise.

Corporation: opening a second business in another market

rockyj — Sat, 06 Jun 2009 01:41:35 GMT

Hello, I am a 50% shareholder of a successful internet business but the other owner does not seem interested in expansion. We have no shareholder agreement and operate as an s-corp.

Is it legal for me to open the same type of business in another city (while still owning 50% of the present company) under a different name or does that violate my "fiduciary duty" as an officer to my present company?

LLC with no operating agreement

RebeccaK — Fri, 05 Jun 2009 19:51:00 GMT

Hi everybody,

What rule applies to let an LLC member go when no previous operating agreement has been signed (just a simple LLC agreement was signed and registered in DE State)?
Does majority stake or majority vote (or else) suffice by default to decide to let go (oust) a non-consenting member for example?

Many thanks for the help!

Need help: Tax Advantage of a PA (Professional Association)

JandaJ — Wed, 13 May 2009 15:35:22 GMT

My husband is an attorney (associate) who currently makes $105K/yr at a law firm. He was recently presented an opportunity to go to another firm as a partner (not equity sharing yet). The proposition includes that he would form his own PA and they would pay him $6,500 a month ($78K/yr) into his own PA from which he would be responsible for his payroll taxes, running his business expenses through (vehicle, meals & entertainment, etc.). They have told him that while the annual salary appears lower than where he is currently at, that running these business expenses through the PA, come tax time, he would be where he is currently at financially. I'm having a hard time understanding this and really want to understand the tax advantages of him having his own PA and how he needs to file taxes, how often (quarterly?) and how this will impact our overall household income. We can't afford for him to make much less than he is making now and they assure him this won't be the case. Any advice/ info you can give me is greatly appreciated.

If this helps, they have told him that within the first year they would expect him to bring in approx $100K in business which would pay off his equity buy in to the firm and from then on he'd be an equity sharing partner (they are very profitable). So, long term it seems like a viable plan but we our mortgage doesn't allow for a short term shortfall in come. Thanks!