Legal Issues for Small Businesses - Is YOURS Covered??

Today The Connectors Network met at Spassos in Laguna Hills - we had a VERY sharp Orange County business lawyer, Kurt Varricchio, with the law offices of Kurt M. Varricchio speaking to the group. Kurt went over business contracts, formation and dissolution issues, risk management, and intellectual property. Kurt started with a helpful take home checklist / brochure (pic by corporate photographer Carol Bridges) to help us stay organized with our business affairs.

The group discussed difficult legal questions like "Should you incorporate?" Are you an S Corp or a C Corp? Kurt recommends an S Corp to save on taxes, but you can only have 35 people in your S Corp. Got 40? Ok, maybe make 2 corps and divide. Gotta love a lawyer mind...no is simply a suggestion!! If your company has less than 35 people, and you are a C Corp, you're double paying taxes - S T O P - call Kurt now at 949-830-3500 and get switched to an S Corp.

Anyone forming a business in Orange County or anywhere should talk to a lawyer to see if you should be a Sole prop, LLC, Partnership, or Corporation. Don't guess - call a lawyer and your CPA so you get started on the right foot!!

Once your corporation is formed, don't think you're off the hook. You need to take your minutes, keep that separate bank account, show adequate capitalization, issue shares, and elect directors. There's maintenance to be done!! Most businesses forget to plan dissolution, and people end up upset when they didn't need to. Plan your buy sell agreement from the beginning so you can end things on a good note :) You do not want to end up in court!!! (coming from a lawyer haha)

Next we discussed business risk management. If you have an office or storefront, maintain it!!! Pick stuff up, keep your cords neat, have your necessary posters and signs up! Also, make sure you have indemnification agreement and proper insurance. If you work with subcontractors you need an indemnification agreement. Ask.. people don't offer this!!!! I know, I know, you are asking what the heck does that mean?! Imdenmification basically means that if you hire someone to do work on your behalf that THEY hold the responsiblity for any mistakes made, not YOU. Kurt had many horror stories, don't become one!! You need a clause in your contracts for this - or you need to draw up a separate agreement. Always always always indemnify. Don't lose your hard earned money for stupid reasons. I'm seriously going back to the office to pull contacts. Argh.

Speaking of contracts, that was next up for discussion. Remember to always read your contracts. Make sure to consider provisions like attorney fees, severability, integration, modification, forum selection (where you fight any court battles at), and written modifications. If you work with clients across the country and forget to specify the county where any court disputes are handled you could end up with a lot of travel fees for you and your lawyer. Did you know oral contracts are good for 2 yrs from the breech? Written contracts are good for 4 years. Of course I didn't know, but now I do, and that's why we network...so we can all do better business :)

WOW, Kurt!! You're so smart!!! Its nice to make sure the business is on track legally - THANK YOU!!! If your business is not on track you may want to come to The Connectors Network and get some info from the experts. Kurt's info:

Kurt M Varricchio
http://www.KMVlawgroup.com
Phone: (949) 830-9402
Fax: (949) 830-9405
Email: info@kmvlawgroup.com

Thanks again to Debbie Lewandowski and Jarrett Gucci for always connecting the right people and spearheading the group. This stuff isn't easy, you guys rock!!