Five Things Employers Need to Know About the CARES Act

On March 27, 2020, President Trump signed The CARES Act (Coronavirus Aid, Relief, and Economic Security Act) into law. The legislation contains numerous provisions to assist individuals, families, and businesses throughout the country during the COVID-19 pandemic. Our South Carolina business attorney has carefully reviewed the CARES Act to help our clients seek maximum benefit from the provisions included in the legislation. 

Below are five ways that the CARES Act can impact employers in South Carolina.

1. Emergency Family Leave and Sick Leave

Employees who are rehired after being laid off on or after March 1, 2020, are entitled to the provisions provided in the Families First Coronavirus Response Act (FFCRA) for emergency family leave and sick leave, as well as paid leave under the Family and Medical Leave Act (FMLA). The FFCRA requires employers to provide COVID-19-related paid sick leave. It also expands family and medical leave.

2. Expansions to the Economic Injury Disaster Loan Program 

Expansions to the EIDL Program were made under the CARES Act to include many small businesses and private non-profits that have no more than 500 employees. Small businesses and non-profits may now qualify for low-interest loans with loan terms up to 30 years. It is important to note that loans under the EIDL Program are not eligible for forgiveness.

3. Paycheck Protection Program 

Loans are available to small businesses with 500 or fewer employees who need assistance funding payroll and necessary operating expenses. The loans are available to most small businesses, including businesses in the hospitality industry that do not employ more than 500 workers at each physical location and have a North American Industry Classification System code beginning with 72. 

Loans under the Payroll Protection Program can be used to pay certain expenses between February 15, 2020, and June 30, 2020, including payroll costs, rent, utilities, interest on mortgages, costs related to group health care benefits, and interest on other loans incurred before February 15, 2020.

If an employer meets certain requirements, the amount of the loan used for eligible expenses during the eight weeks following the loan origination date may qualify for loan forgiveness. However, employers should carefully review the guidelines and requirements to ensure they do not violate the provisions. Violations could result in not receiving forgiveness of a portion of the loan balance.

4. Advances of Anticipated Tax Creditors and Refunds

The FFCRA requires employers to bear the costs of paid FMLA leave and paid sick time available under the FFCRA. A tax credit on the company’s tax return reimburses employers for these costs. However, this process could cause a financial hardship for some businesses. The CARES Act provides a process for companies to request an advance of anticipated refunds and tax credits to help reduce the financial hardship related to paid sick and family leave for employers.

5. Increase in Retirement Plan Loans

The CARES Act also increases the maximum amount a qualified individual may borrow from a qualified retirement plan. The limit on plan loans to qualified individuals increased to $100,000 or 100 percent of the vested account balance. The increase applies to loans granted on or before September 23, 2020. 

Loan repayment terms may be extended for qualified plan loans outstanding on or after March 27, 2020. Loan payments scheduled between March 27, 2020, through December 31, 2020, may be delayed for up to one year, but interest will continue to accrue on the outstanding balance.   

Contact a South Carolina Business Attorney for Help

The CARES Act contains provisions that can benefit your company and your employees. However, you must adhere to all requirements to receive relief.

The above blog is not a comprehensive discussion of all provisions in the CARES Act nor a detailed explanation of the specifics of each provision. The COVID-19 pandemic has severely impacted businesses and families throughout South Carolina. The CARES Act provides much-needed relief for South Carolinians and businesses in our state.

If you have questions about any of the provisions of the CARES Act or questions about how to implement those provisions as an employer, contact Willcox, Buyck & Williams, PA to discuss your concerns in detail.

Sanitation worker cleaning an office space in the wake of COVID-19

Five Tips for Weathering the Coronavirus Pandemic

The coronavirus pandemic has been challenging for everyone, including business owners. Throughout South Carolina, business owners are faced with enormous challenges, including protecting the health of their employees and customers as well as trying to pay bills and overhead costs while being restricted by the various Executive Orders affecting business operations throughout the state.

If you have questions about your obligations under the current Executive Orders or you have questions about programs to help business owners, contact a South Carolina business attorney. An attorney can help you review your options and develop or modify your business plan to incorporate the new “normal” we are all facing in light of the COVID-19 outbreak.

Five Things All Business Owners Should Do to Weather the COVID-19 Pandemic

1. Review all Executive Orders issued by state and local governments.

The Executive Orders issued by the Governor impact businesses throughout the state. Some businesses are required to close while other businesses may remain open with certain restrictions. Make sure that you read these orders carefully and comply with all restrictions to avoid penalties. 

Additionally, check with your county and city government for restrictions. Some local governments have added restrictions for businesses operating within their city or county limits.

2. Apply for loans and other business aid.

There are many state and federal loans, grants, and aid available to businesses during the COVID-19 pandemic. Apply for loans and other aid to help cover payroll and overhead costs. Talk to your lender or attorney to review the various options and the requirements for each loan to determine which aid options are best for your company.

3. Follow CDC guidelines for stopping the spread of the virus.

The Centers for Disease Control (CDC) has guidelines for businesses to respond to the coronavirus. To protect your employees and customers, review and follow the CDC guidelines for COVID-19. 

4. Review contracts, leases, and loan agreements.

You may need to extend the terms of contracts and leases during the pandemic. You may also need to request loan modifications or other considerations form lenders. Review contracts and agreements with your business attorney to determine the actions you can take and your legal obligations. Contact lenders and creditors to inquire about special considerations regarding debts during the shutdown. Many lenders and creditors are working with businesses to help them manage debt payments during the shutdown.

5. Review your business budget.

Carefully review your business budget to determine if there are ways you can reduce overhead to save money. Many business owners are finding they need to adjust their short-term and long-term financial plans to adjust to the coronavirus pandemic. 

As you review your business budget, keep your employees in mind. Be as honest and transparent as possible with employees regarding layoffs and furloughs. If possible, assist employees who are laid off or furloughed seek unemployment benefits.

Contact a South Carolina Business Attorney for Help

It is a difficult and challenging time. Make sure that you communicate with our South Carolina business attorneys regarding business matters during the pandemic. Preparing and planning can protect your business interests, employees, and customers.

Office of a start-up

Legal Issues Every Start-Up Faces

Having an idea for a new business is just the first step in starting your own company. Startups have many legal issues to consider before selling their first product or service. A South Carolina business attorney helps entrepreneurs turn their ideas into companies. Below are a few of the legal issues that every start-up faces.

Legal Issues and Start-ups – What Do You Need to Know Before You Begin Business?

Failing to Have a Founder’s Agreement

Many new start-ups are the result of the ideas and contributions of multiple individuals. A detailed Founder’s Agreement can avoid common legal issues regarding ownership, responsibilities, and duties among a group of individuals. It also dictates how an interest in the start-up or equity in the start-up may be dissolved, sold, or transferred.

Business Entity and Structure

If you do not do anything to create a formal legal entity, state laws recognize your company as a sole proprietor in South Carolina. If you have a partner, state law treats your company as a partnership. However, it might not be in your best interest to operate under these default business entities. Sole proprietors are personally liable for all business debts and obligations. The same is true for partnerships created under state law. 

You must give careful consideration to the type of legal entity you choose for your company. The legal entity you choose for your company impacts your personal liability, taxes, management structure, financing options, and daily operations. 

Protecting Intellectual Property

Failing to apply for patents, trademarks, and copyrights could result in your ideas being stolen by competitors. Protecting your trade secrets is also another important step in protecting your business from being stolen from you. Creating detailed nondisclosure agreements and confidentiality agreements are as essential as applying for patents and trademarks.

Licenses and Permits

Depending on the type of business you create, you may need one or more licenses and permits, especially if you intend to operate a brick and mortar shop. Compliance regulations for some industries are rigorous. Failing to comply with regulations can result in serious legal issues for your start-up.

Using Generic Contracts, Policies, and Agreements

It may be tempting for a start-up to use generic forms found online to save money. However, generic agreements, contracts, website policies, privacy policies, employment agreements, and other documents can create legal liability for the start-up and the owners. Generic forms do not contain the detailed information needed to protect the company and the owners because they are not customized for the company to cover specific state and federal laws applicable to the business. 

Failing to Protect Customer Data

The protection of customer data is a huge legal issue that many start-ups fail to give adequate consideration. If a start-up collects any data from customers or clients, including anyone visiting their website, the company is legally obligated to protect that data. Many federal and state laws in the United States cover the privacy of data and information. Also, a start-up that offers services or products overseas must be aware of international privacy laws, such as the General Data Protection Regulation (GDPR) for the European Union.

Contact a South Carolina Business Attorney for Help

The above legal issues are just some of the things you must consider when starting a business. Many other legal issues may apply, depending on the type of business you create. 

However, you do not need to try to tackle the legal issues a start-up faces alone. Contact Willcox, Buyck & Williams, PA to discuss this important legal checkup in greater detail. Our South Carolina business attorneys can help you ensure that all legal matters are addressed correctly. We help you protect yourself, your ideas, and your company.

Business woman discussing fundraising opportunities.

Effective Nonprofit Fundraising Tips For Board Members

Being a board member for a nonprofit organization means that you will likely be called upon to assist with fundraising. While it may be easy to write a check, the organization benefits greatly from fundraising. In addition to raising capital, fundraising also increases awareness about the nonprofit’s mission. Fundraising may also generate non-financial assets for the organization in the way of volunteers and donations of goods and other items. In the blog below, our South Carolina business attorneys review tips that can help your board members become successful fundraisers. 

Fundraising 101 for Nonprofit Board Members

Eight tips that can help you become an effective fundraiser as a board member for a nonprofit include:

  • Education Board Members — Fundraising is a learned skill. Some board members may not be as effective at fundraising because they have never learned these skills. Share fundraising ideas with other board members. Consider hiring an experienced professional to train board members on fundraising techniques.
  • Set Quarterly Goals for Fundraising — Fundraising should not be a “one and done” annual event. Instead, set quarterly goals for fundraising to encourage board members to engage in fundraising throughout the year.
  • Set Up a Fundraising Committee — Choosing the best fundraisers on your board to sit on the fundraising committee. The committee can help train other board members and help them improve their fundraising skills, in addition to planning key fundraising events.
  • Seek Donations for Silent Auction — If you are unable to host a large event, ask your friends, family, and associates to donate items for a silent auction.
  • Contact Past Donors — Obtain a list of lapsed donors from the organization. Some people who have donated in the past may have gotten busy and forgot to donate again this year. A call or letter may be all it takes to renew the contribution. 
  • Cash in on Favors — When someone asks how they can return a favor, give them a pre-printed donation card and request that they donate to the nonprofit as a way to return the favor.
  • Develop an Event Follow-Up Plan — Holding a successful fundraising event is just the beginning. You need an event follow-up plan to ensure that all donations are received. Also, connecting with event attendees after the event can help encourage them to make additional contributions and possibly work to raise money for the organization on their own.
  • Ask for Matching Donations — Contact companies and business owners that you know and ask them to match donations for a specific event or period. For example, a company may agree to match donations to the nonprofit made by its employees or match a percentage of the profits raised by a specific event held to benefit the nonprofit. Companies can place maximums on their matches to help them feel more comfortable and willing to participate. 

Contact Our South Carolina Business Attorneys to Discuss Your Nonprofit

Our South Carolina business attorneys work closely with nonprofit organizations on numerous issues, including fundraising. Schedule a consult today. Before you embark on a fundraising activity, seek legal advice from an experienced business lawyer to ensure you comply with all state laws and regulations for fundraising in South Carolina. 

Two business professionals looking over an operating agreement.

Five Reasons Your LLC Needs an Operating Agreement

Have you recently formed your Limited Liability Company (LLC) or are you interested in forming an LLC for your business? If so, you will also need an Operating Agreement for your LLC. While South Carolina does not require an LLC to file a copy of one with the Articles of Organization, there are several reasons why your company needs an Operating Agreement. A South Carolina business formation and planning attorney can help you draft an Operating Agreement that meets your company’s needs and protects your interests now and in the future. 

What is an LLC Operating Agreement?

A Limited Liability Company may have one member (owner) or multiple members. Even a single-member LLC can benefit from an Operating Agreement.

An LLC Operating Agreement is a legal document that governs the ownership and operation of the company. The information contained in one varies, but typically includes sections related to membership, capital contributions, organization, management, voting rights, distributions, membership changes, and dissolution. It can also be tailored to meet your company’s specific needs. 

Five Reasons to Create an LLC Operating Agreement

1. Limits Personal Liability

One of the common reasons for creating an LLC is to limit the members’ personal liability for company debts and obligations. Without an Operating Agreement that clearly defines the separation of the business entity from the members, a court could determine that the business is not a separate entity and hold the members personally liable for company debts.

2. Resolve Disagreements

Disagreements related to business decisions and daily operations may arise between members. An Operating Agreement can contain rules for resolving disputes between members. It also provides structure and rules for the company that can quickly resolve a dispute without litigation or mediation if the dispute involves a specific issue governed by the LLC agreement, such as the exit of a member or a member’s authority to make certain decisions for the LLC.

3. Membership Changes

The Operating Agreement dictates how membership changes are handled. For example, what happens to a member’s interest if the member dies? Can a spouse claim an interest in the LLC in a divorce? The agreement may dictate that the other members have the right to purchase the interest instead of allowing the interest to transfer to another person outside of the company.

4. Default Rules Govern the LLC

If you do not create an Operating Agreement for your LLC, the default LLC rules in South Carolina apply. LLCs are created and governed by state law. Many of the default provisions for LLCs may be overwritten by creating one.

5. More Control

An Operating Agreement allows you to control the daily operations of the business, how the business grows, future memberships, members’ voting rights and responsibilities, and distributions from the LLC. Without a detailed agreement, you remain in control of your company even if you choose to add members in the future. 

Contact a South Carolina Business Attorney to Discuss Limited Liability Companies 

Our South Carolina business attorney can help you determine if an LLC is right for your company. We discuss the pros and cons of an LLC. If you want to form an LLC, we can handle all aspects of the business formation, including drafting an LLC Operating Agreement. Schedule a consult today.

Group of employees looking at business entities

Pros and Cons of the Most Common Business Entities

A crucial step that entrepreneurs must take when starting a business is choosing a business entity for their company. Business entities have advantages and disadvantages. The type of business entity you choose depends on your desires, needs, and plans. A South Carolina business attorney can help you decide which entity provides the benefits you need for your business. 

Comparing Pros and Cons of Business Entities

The four most common business entities used are sole proprietorships, partnerships, corporations, and limited liability companies.

Pros and Cons of a Sole Proprietorship

Many small business owners are sole proprietorships. A sole proprietor is someone who owns a full interest in an unincorporated business. Sole proprietors can begin working for themselves without filing any official forms or registering their business with the state. It is the easiest business entity to form, operate, and maintain. The owner is in full control over the business and reports the business income and loss on his or her personal income tax return. 

However, there are some negatives to this type of business entity. A sole proprietor is personally liable for all debts and obligations of the business. Therefore, the owner’s personal assets can be seized for company debts. Also, when the owner dies, the business ceases operation. The assets are subject to the owner’s probate estate. 

Pros and Cons of a Partnership

A partnership consists of two or more individuals who wish to conduct business together. The partnership agreement governs the relationship between the partners. There are several different types of partnerships: general partnership, limited partnership, limited liability partnership, and limited liability limited partnership.  

The main difference between the various partnership structures is the personal liability of each partner. In a general partnership, all partners share personal liability for the partnership debts and obligations. They are also equally liable for any actions or decisions made by the other general partners. With a limited partnership, some partners have limited liability, but they are not involved in the management of the partnership. Limited liability partnerships are usually used for professional service businesses, such as law firms, accounting firms, and physician offices. Typically, the personal assets of each partner in a limited liability partnership cannot be used to satisfy partnership debts.

Partnerships are typically easy to create and maintain. However, partnerships involving limited liability may be more difficult and expensive to create compared to a general partnership. Also, partnership agreements must be carefully drafted to handle the death or exit of a partnership or the dissolution of the partnership. 

Partnerships are not subject to double taxation. The partners share in the income generated by the partnership. The income is reported on the partners’ personal income tax returns. 

Pros and Cons of a Corporation

There are also several different types of corporations: C-Corporations, S-Corporations, Professional Corporations, and Nonprofit Corporations. Each type of corporation may have specific pros and cons associated with that type of business entity.

In general, the main benefit of incorporating is to avoid personal liability for company debts. The shareholders of a corporation are not personally liable for the debts or obligations of the company. Their personal assets are not at risk. 

However, corporations are more costly to form and maintain. In addition to filing Articles of Incorporation with the state, the corporation must file annual reports. It must also have bylaws that govern the company’s operations. A board of directors oversees the company. The board answers to the shareholders who appoint the board members. The board appoints officers who are responsible for the day-to-day operations of the company. 

Corporations are subject to double taxation. The income from the business is reported and taxed on a corporate tax return. The dividends paid to shareholders are considered income and must be reported on the shareholders’ personal income tax returns. 

Pros and Cons of a Limited Liability Company

A limited liability company (LLC) offers many of the benefits of a corporation and partnership without some of the disadvantages. An LLC’s members (owners) have limited personal liability for company debts and obligations. Profits pass through the LLC and are reported on the member’s income taxes, so the company profits are not subject to double taxation. 

However, an LLC must register with the state and have an operating agreement that governs how the company functions. In some cases, it can be difficult for members to sell their interest in the company or leave the company. Operating and maintaining an LLC can be more expensive than a sole proprietorship or partnership. 

Contact a South Carolina Business Attorney for Help

Choosing a business entity for your company can be confusing. The above pros and cons of business entities are a brief introduction to the various entities you might consider for your company. Contact Willcox, Buyck & Williams, PA for more information today. Our South Carolina business attorneys can conduct a full evaluation of your business venture and provide a detailed legal analysis of the pros and cons of each business entity in relation to your unique situation. 

Person signing legal documents

Should Our Company Have Key Person Insurance?

When you operate a business, there are many types of insurance that you need. Some insurance policies are required by law, such as automobile liability insurance or workers’ compensation insurance. Other types of insurance are a wise investment to protect your business, such as liability insurance and property insurance. Our South Carolina business attorneys can help you review your insurance options, including whether you may need key person insurance coverage for your company. 

What Is Key Person Insurance?

Most companies have at least one or more key employees that would be difficult to replace, especially if they died suddenly. It would take time to find suitable replacements, train the replacements, and return to normal work routines. The process can be costly, especially if the company loses clients and customers during the transition. 

Key person insurance helps cover the cost of replacing key employees after a sudden death. It is a life insurance policy for top employees in a company. The proceeds of a key person insurance policy can be used to pay for the recruitment, training, and development of a new employee. The proceeds can also be used to help reimburse the company for financial losses that might occur because of the death of a key employee. 

How Do I Know if I Need Key Personal Insurance Coverage? 

Any company can benefit from key person insurance coverage. The loss of a key employee is never easy for a company. Large companies often cross-train to help reduce the impact of losing an employee. However, a small business that depends heavily on one or two key employees could be devastated if one of those employees suddenly dies. The death of a key person could threaten the company’s financial stability. 

Some circumstances that might indicate the need for key person insurance include:

  • Partners who want to ensure they have sufficient funds to purchase the other partner’s interest in the case of the partner’s untimely death.
  • An employee, such as a salesperson, whose sudden death could lead to an immediate decrease in company revenue. 
  • There are no other individuals who could step into the role of the key employee.
  • Sole proprietors who want to ensure sufficient funds to pay debts of the company or continue the company until employees can find other work.
  • You have a specialized employee that is crucial to the business, and it will take time to locate another employee with the same skills and expertise. 
  • Your company relies on one person to generate most of the company’s revenue.

There could be many other reasons why your company could need key person insurance coverage.

Purchasing Key Person Insurance Coverage

You can purchase key person insurance policies from a variety of companies. The cost of coverage, types of coverage, and policy limits vary depending on a variety of factors. It is advisable to speak with several insurance companies to compare costs and coverages. As with any insurance policy, it is important to read the entire policy to ensure you understand the exclusions and limitations before purchasing the policy.

Contact a South Carolina Business Attorney for Help With Your Business 

A South Carolina business attorney can help you with a variety of issues related to your business, including business succession plans, contracts, litigation, taxation, and compliance. Do not wait until you need legal advice. Get legal advice now to avoid problems and issues that could be costly and time-consuming. Contact Willcox, Buyck & Williams, PA for more information today.

Willcox, Buyck & Williams, PA discusses who is responsible for debts and other obligations when a business folds.

When a Business Folds, Who Is Responsible for Its Debts and Other Obligations?

There are many reasons why a business may close its doors. In some cases, a business closes even though it owes debts to several creditors. If the company is no longer in business, who pays those debts? The answer to that question usually depends on the type of business entity used to form the company. A South Carolina business law attorney can assess the matter to determine if one or more parties might be personally liable for the company debt.

Personal Liability for Business Debts Based on the Business Entity

The type of entity used to form the company has a significant impact on whether owners, members, or partners might have personal liability for business debts or obligations. 

For example, a sole proprietor is personally liable for all business debts owed by the company even when the company closes. On the other hand, shareholders in a corporation have no personal liability for company debts if the business closes. 

Owners (members) of an LLC could have some personal liability for business debts. South Carolina laws governing LLCs state that members and managers are not personally liable for company debts and obligations incurred by the company in the normal course of business. However, if the member or manager commits a wrongful act in the course of conducting the LLC business, the member or manager could be held personally liable for debts or damages.

Partners can also be personally liable for business debts in some cases. In a general partnership, all partners are equally liable for partnership debts. However, in a limited partnership, limited partners do not participate in operating the business. Like shareholders, they are not personally liable for business debts. In limited liability partnerships, all partners are protected from personal liability for business debts.

Exceptions to Rules Regarding Personal Liability for Business Debts

Except for shareholders who play no role in the operation of the business, owners who may not ordinarily be liable for business debts could be personally liable in some cases.

For instance, if an LLC member or a limited partner signs a personal guarantee for a debt, that person is liable for the debt if the company does not pay the debt for any reason. Signing a contract in your personal name also results in personal liability for business debt. All contracts for the company should be signed in the company name. Likewise, using personal loans or personal credit cards for business expenses means that you are personally liable for the debt.

In some cases, courts allow creditors to “pierce the corporate veil” to hold owners, members, or partners personally liable for business debts. These cases generally involve intentional misrepresentation, fraud, or failure to maintain the business entity through proper recordkeeping, corporate formalities, and state requirements. 

Discuss Your Concerns with a South Carolina Corporate Law Attorney

If you are concerned whether you might be personally liable for a business debt, contact a South Carolina corporate law attorney. An attorney can advise you of your legal obligations. Before beginning a business, it is wise to consult with an attorney to determine which business structure offers the benefits you desire while protecting you from personal liability for business debts. Contact Willcox, Buyck & Williams, PA for more information today.

Willcox, Buyck & Williams, PA discusses what you need to know about UCC filings.

Understanding UCC Filings

UCC (Uniform Commercial Code) filings are financing statements filed by mortgage companies, banks, creditors, and other lending institutions against secured collateral. The purpose of a UCC filing is to place other creditors on notice that a creditor has a secured lien against certain collateral that a debtor may be attempting to pledge as collateral for a loan. While creditors, lenders, and other lending institutions may file a UCC statement without the assistance of an attorney, many creditors seek legal advice from a South Carolina business lawyer to ensure that the UCC filing is correct and enforceable. 

Five Things You Might Not Know About UCC Filings In South Carolina

1. The South Carolina Secretary of State’s Office Handles UCC Filings

UCC statements are filed with the South Carolina Secretary of State’s Office. The filings may be submitted online and searches of UCC filings may be conducted via the internet through the Secretary of State’s Office. Filers may also submit UCC statements for filing through the mail or in person at the Secretary of State’s Office in Columbia, SC.

2. Some UCC Statements are Filed with County Offices

In addition to filing a UCC statement with the Secretary of State’s Office, UCC statements that cover real estate fixtures, timber, mineral rights, and tax liens should be filed in the county of residence for the debtor (the person who owes the money) or the county in which the property is located. 

3. UCC Liens Can Be Filed Against Businesses and Individuals

UCC statements can be filed against an individual or legal entity. An individual or business may pledge a variety of assets as collateral for a debt, including but not limited to:

  • Inventory
  • Accounts Receivable
  • Office Equipment
  • Vehicles
  • Real Estate Fixtures
  • Letters of Credit
  • Commercial Equipment 
  • Investment Securities
  • Commercial Instruments, such as promissory notes or drafts
  • Other Goods Used or Owned by a Business 

4. UCC Statements Do Not Prevent Additional Loans Secured by the Same Collateral

A UCC statement does not prevent another lender from loaning money secured by the same collateral listed on a filed UCC statement. However, the subsequent lender is “inline” behind the creditor who filed the first UCC lien. If the debtor defaults on the loan terms, the creditor who filed the first UCC statement has the priority to seize the collateral and sell it to satisfy the debt. UCC statements place lenders on notice that they are getting “inline” behind one or more other lenders who have liens on the same collateral.

5. UCC Blanket Liens Cover All Business Assets

Many UCC statements are filed for specific collateral. However, a business may pledge all of its assets as collateral for a loan under a blanket UCC filing. A blanket UCC filing could make it more difficult for a business to obtain additional funding until the UCC statement is satisfied and canceled of record. Lenders typically prefer blanket UCC liens, but it is not always a wise choice for a business. 

Contact Our South Carolina Business Attorney for More Information About UCC Filings

Disputes and issues related to UCC filings can be time-consuming and costly. Before filing a UCC or signing a UCC statement for a lender, it can be beneficial to consult a South Carolina business attorney to discuss your legal rights and obligations regarding a UCC lien.

Personal Injury attorney shaking hands with client

Five Tips for Selling a Privately-Owned Business

You have built your company over the years into a thriving, successful business. However, you are ready to sell your privately-owned business, but you want to get top dollar for the company. A South Carolina business attorney can help you take the necessary steps to ensure that you receive the best value for your business. Below are five tips that can help you as you begin the process of selling your company. 

Five Steps to Sell your Private Owned Business

1. Begin Preparing to Sell Your Business as Early as Possible

If you anticipate that you might want to sell your company in the next few years, begin the process of preparing for a sale right now. You need accurate books and records, a strong customer base, and the correct business structure to successfully sell a privately-owned business. Making improvements and changes now to your record-keeping procedures, structure, and management style can help you prepare for a smooth sale and transition.

2. Obtain a Business Valuation

It can be difficult to be objective when valuing a business that you built with sweat equity. Obtaining a business valuation from an expert is the best way to know exactly how much your company is worth. Having a professional business valuation can also assist in obtaining the price you desire for your company because potential buyers have an expert opinion to rely upon when making a purchase offer.

3. Prepare Current Financial Documents for Sale

You need several financial documents that are current and up-to-date to present to potential buyers, such as company tax returns, profit and loss statements, balance sheets, and client information. Many buyers prefer to see several years of tax returns and financial statements to gauge the success of the business. Have these documents prepared and ready for prospective buyers to review.

4. Deal with Parties Who Are Pre-Qualified

A pre-qualified buyer is an individual or company who has qualified for financing with a lender prior to making an offer to purchase. Working with pre-qualified buyers reduces the risk that a deal goes through because of a lack of financing. It can be frustrating, time-consuming, and costly to have a deal fall through at the last minute because a buyer could not qualify for financing to purchase your business. 

5. Retain an Experienced South Carolina Business Attorney to Assist with the Sale of Your Business

There are many factors that must be considered when selling a privately-owned business. In addition to the legal documents required to transfer the business, you need an exit strategy that maximizes your profit while reducing your tax liability and general liability after you sell your company. 

An experienced business attorney can assist you with drafting the required legal documents to sell your company, take steps to limit your personal liability, and negotiate a fair price for your company with potential buyers. An attorney can also help you locate a pre-qualified buyer who is serious about purchasing your company.

Consulting a South Carolina business attorney who understands that various legal requirements and laws governing business transactions can reduce the risk of making an error or mistake that could result in expensive legal problems in the future. Contact Willcox, Buyck & Williams, PA to