Legal Question in Business Law in Texas

Business startup compliance

My S corporation was created 5 years ago in Nevada by my resident agent in the same state. Before launching my business I must pay registration fees both to Nevada

and Texas. The fees, as well as my decision to join the local Chamber of Commerce are at about $3500 (mostly overdue fees to RA) which I do not have, cannot nor will I borrow.

My business is creating apparel networks, locally, regionally and nationwide (hence, Nevada) between independent contractors and independent retailers in apparel.

Once I believe I have enough prospective members my plan for acquiring my registration funds is to:

1 Take up membership fees

2 Immediately open business account, wire fees to Nevada and Texas SOS and register my corporation within 24 hours

3 Conduct regular business

My question to you, ladies and gentlemen, is assuming (and I have no doubt it can be done) I do 1 and 2 above would I be in violation or compliance of applicable law?

More specifically, I want to be in legal compliance and not solicit or collect any monies prior to being a registered business entity in the respective states.

Thank you very much for your consideration in my support.


Asked on 2/10/07, 11:01 am

2 Answers from Attorneys
Charles White Charles G. White

Re: Business startup compliance

You do not give enough information for a lawyer to really know what your question is. You talk about "member fees" and acquiring "registration funds." It sounds like you are soliting some type of equity or profit sharing interest nationwide. You are venturing off into a realm of securities transactions which will subject to multi-state and federal securities regulation.

Therefore, your question is not reasonably susceptible to getting a meaningful answer on a free web site. All a lawyer can do is to recommend that you visit with a corporate lawyer who is knowledgeable in securities law.

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Answered on 2/10/07, 11:13 am
Johm Smith tom's

Re: Business startup compliance

If your business entity is not in good standing then you are at risk of being personally liable instead of being protected from liabiliy by the business entity. Aside from the issues raised by your business plan, you could register a new entity to protect yourself and pay off the current debt from your future profits.

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Answered on 2/10/07, 7:57 pm


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