What You Need to Know About Drafting a Business Partnership Agreement

Our MLG Business Litigation Group attorneys in Florida and California know that starting a business requires a seemingly endless number of documents to ensure your best interests are protected from the start of its operations.

One of the most important parts of starting a business is deciding on its structure, especially when there are partners involved.

A business partnership agreement can help you and each of the other partners understand their roles in the company, each person’s obligations, the overall financial details, how they will make joint decisions, and what to do when a dispute arises within the organization.

Here is what Florida and California business owners need to know before they open their doors.

Choosing a Business Partnership Agreement Structure

When partners are ready to start a business together, they must first choose the company’s business structure, so it reflects their current and future goals.

There are typically three business partnership options:

• General Partnerships: A general partnership refers to a relationship in which all partners contribute to the day-to-day management of the business. The liabilities, contributions, and responsibilities of the partners are often equal unless stated otherwise.
• Limited Partnerships: A limited partnership is typically one involving investments for assets, like real estate. Limited partners can have limited liability, which means they are not liable for business debts that exceed their initial investment. They must also maintain a limited role within the company.
• Joint Ventures: A joint venture is a form of general partnership that remains valid until the completion of a project or a certain period pass. All partners have an equal right to control the business and share in any profits or losses. They also have a fiduciary responsibility to act in the best interests of other members as well as the venture.

Within these arrangements, business owners can decide whether they would like to form a Limited Liability Company (LLC), where the owners can shield themselves from personal liability, but all generally have management roles. Others can choose to form a Limited Liability Partnership (LLP) where all partners have limited liability but can also partake in management activities. While nearly any type of business can choose to form an LLC, LLPs are often used for structuring professional services companies, like law and accounting firms.

Create a Business Partnership Agreement That Removes the Fear of the Unknown

At MLG Business Litigation Group, our Florida and California attorneys help businesses outline the most advantageous business structure that reflects the type of business, number of partners, partnership obligations, and how they will split the profits, debts, and other financial responsibilities.

Business partnership agreements are important to have in place before the business starts operating, so everyone is protected from the start.

We can help. Our MLG Business Litigation Group has easy-to-access business startup and document review packages for all types of partnerships, so you can leave the work to a professional business attorney in Florida or California for a fixed cost, instead of hourly rates.

Allow us to help your company get started on the right foot.

Call MLG Business Litigation Group Attorneys Today to Discuss Your Case

Contact our MLG Business Litigation Group partnership attorneys in Florida or California today at (786) 706-9228 for a free case evaluation. We can help you understand your complete legal rights and options to form a successful business that provides dispute resolution requirements in writing, so everyone within the company is protected with confidence.

How Much Money Do I Need to Legitimately Start My Florida Business?

At MLG Business Litigation Group, our Florida Business Litigation attorneys know that everyone’s business venture comes with different start-up costs.

First, it depends on the type of business. Whether you sell web design services or widgets, your overhead costs will vary dramatically.

Next, before you can understand your complete business start-up expenses – including a location or employee requirements – here are a few ways to prioritize the financial costs necessary to get started.

Outline Your Business Plan

Chances are, if you are ready to take the next step to go out on your own, you know what you want to do.

Whether you are opening a vehicle repair shop or an investment firm, you are going to need a business plan — even if you have not decided on a company name or location yet.

A well-crafted business plan allows you to organize your ideas, and professionally share them to court business partners, entice investors, or obtain funding from a financial institution.

A good business plan will also allow you to identify milestones and successfully surpass them.

Choose a Business Structure

Registering your Florida company as a legal business entity — such as an LLC, corporation, or nonprofit — increases your credibility and protects you from personal liability from lawsuits going forward.

Our MLG Business Litigation Group business start-up packages and document review packages will allow you to understand the advantages and disadvantages of certain business types, and which documents are imperative to your company’s success.

For an LLC business, our start-up package includes:

• Attorney Consultation Up to 2 Hours
• Drafting an Operating Agreement for the LLC
• Preparing IRS Form SS-4 and Obtaining an EIN for the Corporation
• Preparing Consents to Be Elected Initial Director for the Initial Board
• Drafting and Filing Articles of Organization with the SCC
• Preparing and Filing Certificates at State Levels
• Confirming Desired LLC Name Availability with the Florida Department of State

For Corporations, our start-up package includes:

• Attorney Consultation Up to 2 Hours
• Drafting Bylaws for the Corporation
• Preparing IRS Form SS-4 and obtaining an EIN for the Corporation
• Preparing Stock Certificates for Initial Shareholders
• Preparing Subscription Agreements for Initial Shareholders
• Preparing Consents to Be Elected Initial Director for the Initial Board
• Drafting and Filing Articles of Organization with the SCC
• Confirming Availability of Desired Corporate Name with the Florida Department of State
• Resolutions

MLG Business Litigation Group provides individuals and groups with business start-up packages and legal advice that is available using flat fees, so you can plan and pay for your legal costs upfront.

Call MLG Business Litigation Attorneys in Florida Today to Discuss Your Start-Up Needs

Contact our MLG Business Litigation Group attorneys in Florida today at (786) 706-9228 for a free case evaluation to learn which legal structure is the best for your new business needs and anticipated growth, and what documents you need to legitimately get started and protect your investment.

What is the Best Legal Structure for My Florida Business?

Our MLG Business Litigation Group attorneys know that it may be difficult for prospective business owners to determine which legal structure is best for their Florida business.

While the type of business can help determine which legal structure will help drive its growth, the number of parties involved in its creation, operation, and success will ultimately determine whether you form a sole proprietorship, general partnership, LLC, or corporation.

Here is what new business owners need to know about starting their vision on the right — and legal — foot.

Is a Sole Proprietorship Legal Structure Right for My Florida Business?

The most basic legal structure for a Florida business is a sole proprietorship.

Like it sounds, a sole proprietorship means you — solely — are the business.

Sole proprietors must register the business under a name that is not their own and renew it every five years with the Department of State Division of Corporations.

The advantages of sole proprietorships include having zero equity interests issued to other parties, no restrictions on how the company operates, and the ability to transfer its ownership freely.

The most common disadvantage of owning and operating a sole proprietorship is that there is no protection from its creditors, making the business owner personally responsible for all debts associated with the company.

That means all creditors, including vendors or a property owner who holds the company’s lease, can sue the business owner personally.

To help avoid the risk of creditors successfully pursuing your business for its debts, consider creating a partnership, LLC, or corporation to protect your interests.

Is a General Partnership Legal Structure Right for My Florida Business?

When two or more people form a for-profit business in Florida, it is called a Partnership.

While no formal registration is needed to start a Florida partnership, all standard business enterprise rules apply once it is up and running, including how your business operations are governed by Florida’s Revised Uniform Partnership Act.

In short, creating a partnership agreement establishes a rulebook for your business.

This legal document dictates how the:

• Business is run, including the relationships between the partners
• Profit and loss sharing is distributed
• Conflicts will be resolved

Talk to our skilled Florida business start-up attorneys today to learn if a general partnership is right for your company, so we can help you get started.

Is a Limited Liability Company (LLC) Legal Structure Right for My Florida Business?

Forming a limited liability company (LLC) in Florida provides its owner(s) with limited liability protection, so personal assets are not at stake in the event your business is sued or cannot pay its debts.

There are multiple advantages to the LLC legal structure, too, including the ability to create a legally binding operating agreement and address member disputes without litigation.

Is a Corporation Legal Structure Right for My Florida Business?

A corporation’s legal structure offers liability protection to the owner, so all assets and liabilities can be in the name of the corporation.

Once the owner files for, and receives confirmation of Articles of Incorporation, he or she should sign all leases, contracts, and other legal documents in name of the corporation only, and not personally.

The advantages of incorporating your Florida business include:

• Limited liability for debts and actions of the corporation
• Personal asset protection for shareholders
• The ability to raise funds and generate capital through the sale of stock
• Corporations file taxes separately from their owners, providing the ability to only pay taxes on corporate profits paid in the form of salaries, bonuses, and dividends
• Shares of ownership can be transferred unless restricted by articles of incorporation, shareholder agreement, bylaws, or another agreement between the corporation and its other shareholders

Determining which business structure is best for your company can be complex. Our skilled Florida Business Litigation attorneys help simplify the process, so you can make informed decisions about your future success.

Contact MLG Business Litigation Group in Florida Today to Get Started

Contact our MLG Business Litigation Group, a Division of The Morgan Law Group, and business start-up attorneys in Florida today at (786) 706-9228 to discuss your unique company needs.

We will review your documents and/or offer our legal advice using a flat fee, so you can plan and pay for your legal costs upfront, so you can take the next steps and schedule your initial Zoom meeting today.

The Top 10 Mistakes Made When Starting and Operating a Florida Business

Our MLG Business Litigation Group attorneys know how difficult it can be to navigate the legal requirements associated with starting a business in Florida. 

That is why we have designed unique Florida business start-up packages that help our clients establish their vision using flat legal fees they can plan for to help avoid the common pitfalls associated with starting a company.

Here is what new business owners need to know to help avoid the top 10 mistakes made when starting and operating a Florida business.

Mistake One: Failing to Register the Business with the State of Florida

All Florida businesses new and existing must register their companies with the Florida Department of State when they are conducting business within its borders.

Failing to do so may result in difficulties establishing a company bank account, which may leave the person or partners personally liable for business debts and obligations.

Mistake Two: Failing to Choose a Unique Business Name

Before you can establish your brand, and register your company with the State of Florida, you must choose a unique business name that does not interfere with the intellectual property rights of a third party.

Simply put, if you choose a company name that is the same or remarkably like an existing brand, you may be required to change it and potentially be held liable for any damages that resulted from your oversight.

Vetting the business name first will save time, money, and the headache of losing your brand equity later.

Mistake Three: Failing to Establish Partnership or Shareholder Agreements

If you are not the only one starting a new company that involves more than one principal, you must develop a partnership, LLC operation, or shareholder agreement in place before the business begins.

These agreements set forth the expectations for the business and its owners, and include provisions that dictate:

• How business decisions will be made
• How profits will be distributed
• What will happen in the event of a dispute between the parties
• When owners can transfer their business interests
• What will happen in the event of the death, disability, or divorce of one of the partners

At MLG Business Litigation, our skilled Florida business start-up attorneys provide flat fee partnership agreements that will allow you to begin operating with confidence.

Mistake Four: Failing to Adequately Address Accounting and Tax Issues from the Start

Before you can successfully keep track of your business’s accounting needs, including basic accounts payable and receivable requirements, you must determine which documentation method you are going to use.

Whether you prefer to use in-house software, like QuickBooks or something similar, or hire a bookkeeper or Certified Public Accountant to do the work, you must decide before billing customers or paying vendors.

Failing to establish a reliable accounting procedure first can significantly impact your business’s profits, losses, and overall success.

In addition, all for-profit Florida businesses are required to pay local, state, and federal taxes. To avoid IRS penalties, establish a clear and concise accounting process from the start.

Mistake Five: Failing to Separate Personal Accounts from Business Accounts

This one is simple but often overlooked.

If you do not separate your personal financial accounts from your business accounts, you cannot properly shield yourself — or your partners — from personal liability for the activities and actions undertaken on behalf of the business.

That means creditors can hold a shareholder, member, or partner personally liable for the acts of the business.

All businesses should establish a separate bank account — or accounts, when necessary — and any business expenses that must be paid from that account to avoid commingling business funds with personal funds.

Mistake Six: Failing to Comply with Florida Employment Laws

The fines and penalties associated with violating Florida employment laws are significant and can swiftly cripple a start-up’s ability to successfully operate.

The moment your company hires its first employee, the business becomes an employer, you must comply with certain employment laws, including wage and hour, civil rights, and whistleblower laws.

Mistake Seven: Failing to Develop and Enforce Business Contracts

A common Florida business start-up mistake is entering into an agreement with a customer, vendor, strategic partner, or even an independent contractor with a solid business contract in place.

Business contracts outline the expectations of each party involved, specifically identifying each party’s responsibility, the timeline of the agreement, and at what expense.

When no written contract is in place, any person or business can default on the agreement without being held responsible for its breach. This could easily jeopardize your business before you even get started.

Mistake Eight: Failing to Quickly and Accurately Address Business Disputes

Whether it is an intra-office spat between partners or a disagreement between the company and a vendor, failing to assess the complaint and a potential remedy early could lead to lawsuits and litigation.

When the courts become involved, the outcome will be costly. This can cripple a small business from the start.

That is why it is important to have solidly constructed contracts in place that address dispute resolution, so you and your company can mitigate the risk of costly litigation.

Mistake Nine: Failure to Obtain a Required Business License

Not all Florida businesses require a license to operate in the state, but if yours does, you much procure the license before you start conducting business. Failing to do so may result in substantial financial penalties.

Depending on where your Florida business is located, the local licensing requirements may differ. Our skilled Florida business start-up attorneys can help you determine if you need a license, which type(s), and how to successfully file for the proper credentials, so you can get your company off the ground quickly.

Mistake Ten: Failing to Purchase Liability Insurance

When companies do not purchase liability insurance, they are opening the door to lawsuits that may require payment directly from the company, business owner, partners, or shareholders’ pockets.

Do not wait until you are faced with a claim to engage in risk management for your business.

One of the best ways to manage risk for your business is to purchase liability insurance.

Contact MLG Business Litigation Group in Florida Today to Get Started

If you are ready to start a Florida business or need help moving your company to the next level of operation, our skilled Florida Business Litigation attorneys can help provide real-time legal guidance, advice, and solutions.

Contact our MLG Business Litigation Group attorneys in Florida today at (786) 706-9228. We can help you understand your complete legal rights and options to start and keep your Florida business on track.

What damages can be claimed for breach of contract?

Our MLG Business Litigation Group attorneys in Florida know that business contracts are a key element to success for individuals and companies alike.

Generally, the idea behind a business contract is to ensure all parties involved uphold their end of the agreement, and that they are protected legally when one does not.

Whether a contract is written or oral, it can be legally enforced.

What are the Legal Remedies for Breach of Contract in Florida?

When it is time to take legal action against a person or party for breach of contract, our clients may pursue all applicable damages suffered from the terms not being fulfilled.

That may include:

• Compensatory Damages

Compensatory damages are the direct financial losses incurred by the breach of contract.

• Consequential Damages

Consequential damages are those that were incurred indirectly by the breach. For instance, if one party ordered a piece of equipment that was never delivered, the breaching party may have to pay for any payments that were made towards the equipment, and the additional expenses that were incurred when ordering replacement equipment.

• Incidental Damages

Incidental damages are expenses incurred by the non-breaching party to avoid other direct and consequential losses caused by the breach of contract.

• Liquidated Damages

Liquidated damages are terms outlined in the contract that state what will happen if one party breaches the agreement.

When we can prove a breach occurred, the defendant will usually be required to pay the number of damages specified in the contract.

• Punitive Damages

Punitive damages are awarded to punish the breaching party for their behavior. Punitive damages are often the result of breaches that also involve a tort, including one for embezzlement or fraud.

Contact MLG Business Litigation Group in Florida for a Free Case Assessment Today

If your business has been negatively impacted by a breach of contract, our Florida business litigation attorneys can help you pursue the breaching party for the full extent of damages their behavior has caused.

Contact our MLG Business Litigation Group attorneys in Florida today at 888-904-2524 for a free case evaluation. We can help you understand your complete legal rights and options to get your business back on track.