Legal Question in Business Law in New York

Re: adding people to a s corporation

Is your business currently incorporated? A partnership? A Limited Liability Company (LLC)? If so, you can sell shares, partnership interest, or membership interest to the new "partners" pursuant to your existing articles of incorporation, partnership agreement, or articles of organization. You should consult your attorney about setting up a buy-sell agreement (a.k.a. shareholders agreement) to set the terms of your "partnership" with the 2 people.

If you do not yet have a business entity, I suggest that you hire an attorney to help you determine which form of business entity is best for your business. Again, have your attorney set up a buy-sell agreement.

Also, make sure to consult a tax attorney or accountant about the tax consequences of your decisions.

Changing a business name or filing a d/b/a certificate is not diffiucult (nor is it expensive). If you are already a corporation/partnership/llc, then file for change of name and amend your organization documents with the Department of State. If you are a sole proprietorship and intend to stay a sole proprietorship, then you can simply file a certificate of assumed name with the County where your business is located.

You may email or call my office for a more detailed discussion of your case. Good luck.

Re: adding people to a s corporation

The actual task of adding "partners" or "shareholders" is not terribly complicated. You need to draft appropriate board resolutions and issue share certificates to those people. If you are not a lawyer, you are better off hiring someone to do it for you.

Your situation is more complex then you might think. This is because if all you do is add the partners as shareholders, you may find yourself in a situation where your partners have a lot more flexibility than you might want them to. For example, they could sell part of their shares to their family, friends, etc., and you will find yourself having a lot more than 2 more partners. For that reason, people in your situation typically enter into a stockholders agreement when bringing in partners. You will need an experienced lawyer to draft a stockholders agreement properly.

You may call me at (212) 695-6400 to discuss this further.

Re: adding people to a s corporation

It is best to establish a corporation, but either a corporation or a partnership would be the appropriate form. In either case, a shareholder's agreement or a partnership agreement must be prepared. Without an agreement in writing, there would not be any method for you to prove what you have agreed to should things go bad in the future. You should keep in mind that this is the purpose for agreements! If things go well, you will never have to go back to the agreement to see what it says.

You can work with an existing corporation or start a new corporation. If you have an existing corporation, the shareholders agreement can be prepared for that corporation and a "doing business" certificate can be filed to conduct business under a different name.

Our office performs this type of legal service and frequently performs services for those who cannot travel to our office by making use of telephone contact, e-mail and Federal Express. Legal fees can be paid via credit card authorization. You can call our office to arrange for a telephone consultation at 212-267-7000. For general information on a variety of legal subjects, please go to www.VeneziaLawFirm.com

Re: adding people to a s corporation

Technically it is not complicated but without the proper planning more trouble could be created down the line. I have done this for other restaurants. You can call me at 212 683 8677