The historic reality is that the majority of new businesses fail. The consequences of business failure has a profound impact on the business participants. Although the need for a personal guarantee to obtain initial credit for the new enterprise has long expired, the guarantee did not and may come back to haunt years after the original guarantee is forgotten or the business is sold. It is crucial that the initial informality of the business arrangements mature as the business grows. This requires periodic evaluation of the business structure, update necessary documentation and ensure that the business realities are reconciled with entrepreneurial expectations.
The new business may require the preparation and negotiation of numerous contractual documents such as product and distribution agreements, sales or service agreements, operating contracts, leases, and personal guarantees, in order to proceed. Sometimes the sale of nationally promoted products or service is desirable, necessitating a distribution or a franchise agreement. Competent legal assistance can ensure the client comprehends the technical and business risk as well as the choices available to minimize them. It is essential to protect the business' valuable commercial information such as client lists, trade secrets, bid structures, pricing strategies, inventions, and other intellectual capital in addition to traditional intellectual property. Safeguarding this information is imperative when it is stored in electronic form. It is advisable to develop and implement reasonable physical and electronic protections for business commercial information. Such plans should also include a balanced introduction of intellectual property and invention assignment, and non-disclosure, non-compete and non-solicitation agreements into the employment fabric of the business.
As a business evolves and grow, its structure made need to be adjusted to accommodate changes, define the relationships between key participants, and to implement succession planning. Strategic planning can help formulate a plan to rekindle the entrepreneurial spirit to focus on long-term business objectives and create a lasting formula for success. Additionally, business structures can recommend, create, and implement the appropriate business association for a specific situation. Sound legal advice at early stages of an emerging relationship can be a cost-effective alternative to later dealing with the inevitable and expensive conflict resolution.
HENAULT & SYSKO, CHARTERED can help with your business' legal needs including assisting you with new business startup, drafting formation documents, bylaws; corporation agreements; stock and employment agreements; the acquisition of licenses, patents, trademarks, and copyrights; drafting buy-sell agreements; short and long-term strategic planning; and when necessary all aspects of commercial litigation.