Nowhere else is the adage “an ounce of prevention is worth a pound of cure” more relevant than in the world of legal compliance for businesses. Businesses that fail to comply with corporate formalities can face serious consequences, including directors’ personal liability for the liabilities of the company, difficulty borrowing money, invalidation of actions taken by directors and managers, and invalidation of issued shares. If the crazy year that was 2020 pulled you away from the critical corporate law matters facing your business, make 2021 the year you get reorganized and avoid the oftentimes devastating consequences poor legal housekeeping can have on your business.
Consider the following corporate compliance duties:
- Hold an annual meeting for your corporation or LLC.
- Draft corporate resolutions documenting major changes in the company (e.g., changes to the board, executive team, or number of authorized shares). Determine if any changes require the filing of a Certificate of Amendment.
- Close inactive businesses.
- Verify you have a registered agent.
- Meet with tax advisors.
- File all required annual reports.
- Review vendor, employment, and client contracts. Should certain employees execute non-compete or non-disclosure agreements? Have they?
- Examine your permits and licenses—do any require renewal?
- Renew DBAs and trademarks.
- Verify your business structure is still the best choice for your company.
John Sallaway is a business transactions attorney who has been advising individuals and organizations on their day-to-day legal issues since 2006. As a former executive, John learned the legal process from the perspective of a client and grew to appreciate the value of efficient, straightforward legal strategies to achieve business objectives. As an attorney, John uses that experience to help his clients develop those strategies. These skills help clients stay ahead of critical issues and focus on what they do best—running their businesses. Contact John today to identify issues and get your business get back on track for 2021.
Saunders, Walsh & Beard is a business and litigation law firm in McKinney, Texas. Formed in 2012, today SWB has more than 16 attorneys. The firm assists individuals and businesses with commercial, business and tort litigation, construction law, corporate and partnership formation and expansion, employment law, insurance disputes, judgment collection, personal jurisdiction, and real estate. We believe the client’s “experience” is of paramount importance. Explore our practice areas and see why the attorneys of Saunders, Walsh & Beard are ranked by their clients and peers as among the best in their fields.