Why should my business have an attorney?
Here at Clayson, Schneider & Miller, PC we have seen how important dependable and consistent legal support is to ensuring a successful lasting business. Building legal costs into the business plan is going to be necessary at about every step of the way. Why hire an attorney for your business? Here are 8 reasons an attorney will help keep your business on track:
1. Before you sign – do you know what every part of your commercial lease means and how it will impact your bottom line?
Glossing over the details of a commercial lease whether it’s a traditional retail or office suite lease or a co-working space, could prove costly to your business’ operation. The monthly rent may seem like a good deal but there can be hidden costs baked into the deeper contents of a lease. Hiring a lawyer will not cost very much to get the peace of mind to ensure you have eliminated hidden costs while those hidden costs could add up to several thousands of dollars over the course of a year or more that you are committed to the lease term.
2. Before you share – have you protected your ideas during the course of business negotiations?
Negotiating with a manufacturer, sales representative or any partner to your business to grow the business or advance you ideas or practices often requires an intimate discussion about your design process or other proprietary information that is important to protect to ensure you are in control of your ideas and the profits that stem from your ideas. It is important to have a lawyer help you to navigate business negotiations, it is important that you trust your business’s partner, but a hand shake will not always protect you and trust should not come at the expense of getting the legal documents in place to keep those discussions open and frank and most importantly, confidential.
3. Before you buy – did you conduct due diligence in purchasing a business or its assets?
Even the most straight forward purchase agreement should involve an attorney. Knowing the quality of the business, equipment or commercial property you are about to buy must look deeper than the surface appearance. Vetting all of the liabilities of the company to make sure they do not attach to what you are buying, determining that the assets you are buying are not collateral for debt owed by the seller and uncovering any other potential problems or possible headaches with the deal need to be looked at. A lawyer can help you evaluate the field of issues and weigh the risks and benefits of what you are buying so you can make the most informed decisions about what you could face and can help you avoid risks that are not worth taking.
4. Before the expansion – have you negotiated the best deal for the acquisition of a business or its assets.
Buying a business or its assets to grow or start your own company is an exciting milestone for entrepreneurs. No one wants to get bogged down in the legal muck that could ruin a good deal. Hiring an attorney to negotiate the legal aspects of a deal and helping you sort out the terms that protect you and your new business from the ghosts of the old business is not an option, but the best way to keep your new or growing business nimble and out of unforeseen trouble. Even the most seasoned entrepreneurs who have experience in buying up assets or businesses know that going without solid legal advice can result in unnecessary catastrophe down the road.
5. Before you hire – are you ensuring your customers and clients cannot follow a key employee to a new business and will your written agreements with employees hold up in court?
The trusty old non-compete agreement is a good way to protect your client base and revenue streams from walking out the door with a key employee who moves on to a competitor or who starts their own business. Maybe you have relied on a standard non-compete contract from the internet and have every employee sign a generic agreement. Do you know if your agreement can be enforced in court if you needed to push the issue? Not all non-competes have the same force of law, some terms may be too broad to enforce and if an employee decides to test out the strength of the agreement, you may be facing a losing battle on retaining clients who want to stick with your former employee for future services.
6. Before the advance – do you understand what the terms of your commercial loan mean and do you know whether financial statements in your loan application are accurate?
You can be sure that your business’s commercial lender has had a slew of attorneys and dozens of real life lending experiences to inform the drafting of their loan agreements to protect your lender in every possible way. Your interface with the loan officer typically is a very friendly experience as it should be – this is your sales representative who sold you on taking out the loan for your company. However, your loan officer’s job is not to represent your best interests but to facilitate the deal and the closing on the loan. Your company needs its own legal representation during the loan negotiation process and in the final review of the documents BEFORE you sign. Your lender may not give you a lot of room to negotiate the nitty gritty terms of the deal but some terms may be negotiable and for those that are not negotiable – your company’s attorney can help you understand exactly what you have agreed to and identify potential risks involved in the loan so that you can make the best business judgment to avoid future trouble with your lender once the deal is closed.
7. Before you advance – is the personal loan you made to a business secured by property or assets in the right way?
The nightmare scenario for any business owner who has entered a long-term agreement for the sale of a business or a private loan agreement is to find your buyer or borrower files for bankruptcy and you have not properly secured your rights in property to preserve the value of the sale or the loan. It is important to have an attorney map out the sale process and identify all of the documents and steps needed to thoroughly protect you and in a sense – to protect your financial interests in the event of financial distress for your buyer or borrower. If you have not followed the right steps and set up the right documents you may have given up your financial security. An attorney will ensure your documents meet your goals and protect your interests in the deal – why take the risk of transferring thousands of dollars of property or money before you get trusted legal advice?
8. Before you engage – do you know your termination rights in the service contract you are about to sign?
Whatever the service agreement from internet service to a rug cleaning service, the monthly cost is not the only thing you need to look out for. Many service agreements have expensive an onerous termination clauses that serve as a disincentive to cancel the contract. It is important for your business to be able to adjust its monthly and annual budget up or down to meet existing needs – long term service contracts can stand in the way of your ability to reduce costs during a tighter revenue year or month. It is worth hiring an attorney to provide you confidence in your ongoing operation knowing you can get out of a service contract without paying significant cancellation fees and ensuring the terms are mutually beneficial for a long term relationship.
At Clayson, Schneider & Miller, PC we offer legal services in a manner that you can budget for and to remain proactive in your business – do not wait for a crisis to call an attorney – have an attorney by your side to navigate away from crisis.