Remember when you first started your business? You filed your paperwork, got your tax ID number, opened a bank account, and got to work. You probably felt pretty good about having everything in place.
But that was then. What does your business look like now?
Maybe you've added employees, expanded your services, brought on a business partner, or started thinking about selling someday. Those are exciting changes! But here's something business owners often overlook: The legal foundation you started with may not be the one your business needs today.
As a small business attorney, I've seen plenty of businesses that were growing successfully on the outside but had some important gaps in their legal foundation.
So, how do you know if it's time to take another look?
1. You've Grown, But Your Governing Documents Haven't Changed
Your Operating Agreement or corporate governing documents establish the rules for how your business operates. Who makes decisions? Who has authority? What happens if an owner leaves?
If those documents haven't been reviewed since you started your business, they may no longer reflect how things actually work.
And if you never had them prepared in the first place? That's something worth addressing, too!
2. You're Bringing in New Owners or Planning Your Exit
Maybe you're considering adding a partner, transferring ownership to family members, or selling your business.
These are big decisions, and your business entity needs to be prepared for them.
We've worked with business owners who discovered missing or outdated corporate documents while preparing for a sale or ownership transition. Getting those documents organized ahead of time can make the process much smoother.
3. Someone Is Asking for Documents You Don't Have
You're applying for a business loan, pursuing a certification, or entering into a government contract. Suddenly, someone asks for your formation and governing documents.
And you realize you don't have them.
This happens more often than you might think! Filing on Sunbiz and obtaining an EIN are important steps, but they aren't the entire legal formation process.
If you can't produce the documents that establish your company's ownership, management, and authority, your business may have some gaps that need attention.
4. Your Business Has Become More Complex
Maybe you've expanded into new services, acquired valuable intellectual property, opened additional locations, or started operating in multiple states.
As your business becomes more complex, so do the legal considerations.
Sometimes the original entity structure still works perfectly well. Other times, changes to the structure or governing documents may be appropriate to better support the business and manage its risks.
The important thing is knowing the difference.
5. You've Been Keeping Up With Sunbiz, But Not Much Else
Filing your Florida Annual Report each year is important, but it's not the only part of maintaining your business entity.
Corporations and LLCs also have internal governance requirements that may include documenting important decisions, maintaining company records, and following the rules established in their governing documents.
Just because your business is active on Sunbiz doesn't necessarily mean all your legal housekeeping is done.
So, What Should You Do?
Think of your corporation or LLC as a container. If the container is solid, it helps keep the business's obligations separate from your personal affairs. But if there are gaps in that container, problems can arise.
That's why we conduct Business Audits at The Legal Department.
We review how your corporation or LLC was formed, examine its governing documents and maintenance over time, and identify any missing pieces that need to be addressed.
You may find that everything is in great shape. Wonderful! Or you may discover a few things that need attention before they turn into bigger problems.
The bottom line? Your business doesn't stand still, and your legal foundation shouldn't be forgotten as it grows.
If it's been a while since you've looked at the legal side of your business, it may be time for a checkup. We'd be happy to help!
Information in this journal post is for general informational purposes only. Nothing in this journal post should be taken as legal advice for your individual situation. Viewing this journal post and/or contacting us does not create an attorney-client relationship. Please do not send confidential information to us until an attorney-client relationship has been established.