Establishing and operating a business is something that not only demands hard work, intellect, and creativity. Also, it requires adherence to various laws, business regulations, and best practices. For many businesses, establishing a fictitious name is one such step that a business may take in order to protect their best interests. Establishing a fictitious name, though, is a legal process that a business must take care in performing. At the law offices of BrewerLong, our Florida business lawyers can guide you through fictitious names in Florida, as well as how to cancel a fictitious name in Florida. Please contact our lawyers today to learn more. What Is a Fictitious Name? As found in Florida Statutes Section 865.09, a “fictitious name” is defined as any name under which a person transacts business in this state, other than the person’s legal name. For businesses, operating under a fictitious name is very common, and is known as “doing business as,” or DBA, another name. For example, if Jane Doe establishes a bakery, rather than operating as “Jane Doe,” she may decide to operate as “Sweets and Treats.” This means that Jane Doe is doing business as “Sweets and Treats,” and that she has established a fictitious name as such. Registering for a Fictitious Name in Florida Most businesses, even sole proprietors, want to establish a fictitious name – this is a common practice. In order to establish a fictitious name in Florida, registration with the Florida Division of Corporations is required. The process for registration is straightforward, and can be done online or by mail. All of the instructions for fictitious name registration can be obtained online. How to Cancel a Fictitious Name in Florida For a range of reasons, a business owner may wish to change or cancel their fictitious name at some point, perhaps because they wish to do business in their actual legal name, because they want to change the name to something else, or because they are dissolving their business. In any case, it is important that the business owner understand the requirements for properly canceling a fictitious name in the state. In order to change or cancel a fictitious name, use the Fictitious Name Registration application (accessible online). According to the Florida Division of Corporations, completing sections one through four of the application can simultaneously cancel and re-register a fictitious name. These sections include questions about the fictitious name of the business, the business’ mailing address, the FEI number of the business, the registrant’s name and address, and a signature. For cancellations only, only section four of the form must be completed. This section clearly states that the registrant is canceling the fictitious name – the registrant must provide the date that the fictitious name was originally registered and the assigned registration number. In addition to the cancelation form, a fee of $50 must be paid. Additional fees may be paid for a certificate of status or a certified copy. Working with a Lawyer When Establishing or Canceling a Fictitious Name If your business wants to establish or cancel a fictitious name in Florida, working with a lawyer is strongly recommended. The benefits of working with an attorney are numerous, including: Ensuring that you register for a name that is not already in use; Ensuring that all paperwork related to the registration of a fictitious name is filled out accurately and in full; Managing all filing of paperwork and the payment of applicable fees; Guiding your business through the benefits of fictitious name change or cancelation; and Managing the re-registration/renewal of a fictitious name. As a business owner, there are numerous things that you must deal with on a daily basis to ensure the smooth operation of your company. When you hire a skilled attorney to manage things such as fictitious name registration and cancellation, you have one less thing to worry about that demands your personal attention. This allows you to focus your efforts on other important elements of running your company and provides peace of mind that legal elements are being handled properly. Call Our Florida Business Lawyers Today Most business owners choose to register a fictitious name rather than do business in their own, personal legal name. However, there may come a point when a business wishes to cancel or change their fictitious name. Whether you need assistance in registering for, canceling, or changing your business’ fictitious name, our business lawyers in Florida are ready to assist you. We have been providing legal services to businesses throughout the state for years and are knowledgeable in all areas of business law and the many requirements that businesses in our state are bound by. To schedule a consultation with our Florida business lawyers, please call us directly or send us a message. We help to protect your best interests.


If you are thinking about starting a business in Florida, it is important to understand the distinctions among the different types of business structures. Also, it’s important to learn more about how a limited liability company, or LLC, may be able to benefit you. There are many different types of small businesses and companies in Florida, and those entities use several different types of business structures. There are pros and cons to each type of business structure, and it is important to work with a Florida business law attorney to better determine which type of business is best suited to your needs. At BrewerLong, we are committed to helping business owners in Florida with a wide variety of business law matters. We want to say more about the benefits of an LLC in Florida. What is an LLC? In order to understand the benefits of an LLC, it is important to understand what this business structure is and why it is used. As the U.S. Small Business Administration (SBA) explains, an LLC has some elements of both corporations and partnerships. One of the reasons that many people choose an LLC when starting a business is that, in this type of business structure, owners are not personally liable when an LLC files for bankruptcy or faces a lawsuit. To be clear, the business owner’s personal assets, including bank accounts, house, and other assets, are not at risk because the LLC is at risk. Flexibility of LLCs in Florida In Florida, LLCs are relatively easy to set up under the Florida Revised Limited Liability Company Act, and Florida law does not place any restrictions on the number of members in the LLC. To be sure, a single person can form an LLC in Florida, which is not true in all states. Flexibility of LLCs in Florida also allows business owners to choose whether to manage the business themselves or to hire managers who are not owners of the business. Taxation Benefits Another Benefit of LLCs is that they are “pass-through entities,” which means that all business owners receive profits from the business without the profits facing business taxes. Then, anyone who receives profits from the LLC includes those profits on a personal income tax return. Yet claiming these profits on a personal income tax return is still favorable to the person receiving the profits because those profits are not classified as earned income. Accordingly, the LLC member does not have to pay self-employment tax on those profits. Personal Asset Protection One of the most important benefits of an LLC is the personal asset protection we mentioned above. One or more people can form an LLC in Florida to start a small business without being concerned about whether their personal assets are subject to liability. However, it is important to make clear that asset protection for single-member LLCs may be limited in Florida due to a relatively recent Florida Supreme Court case. In Shaun Olmstead, et. al v. Federal Trade Commission (2010), the Florida Supreme Court ruled that single-member LLCs only are entitled to limited personal asset protection. In that case, the court determined that Florida law “permits a court to order a judgment debtor to surrender all right, title, and interest in the debtor’s single-member limited liability company to satisfy an outstanding judgment.” The case suggests that multiple-member LLCs are not subject to the same limited asset protection. Discuss Your Options with a Florida Business Formation Lawyer If you are thinking about starting a business and have questions about whether an LLC is right for you, you should speak with a Florida business formation attorney as soon as you can. An advocate at our firm can discuss the benefits of an LLC with you and can help you to learn more about the business structure that is best for your needs. Contact BrewerLong for more information.


Are you considering opening a small business in Florida, or starting a company with partners? No matter what type of business you are thinking about, you will most likely need a commercial space from which to run your business. Renting a commercial space can feel daunting, and understanding the terms of a commercial lease can be complicated, particularly if you are new to Florida’s nonresidential landlord-tenant law. To be clear, while residential and commercial leases do have some similarities, these documents also have a lot of differences. When you are drafting and reviewing a commercial lease, it is important to understand the distinctions between residential and nonresidential lease agreements, and to be sure that your lease provides the protections you need. At BrewerLong, we can assist you with all aspects of your company, from initial business formation through dissolving a business. An experienced Florida business lawyer at our firm can speak with you today about drafting and reviewing a commercial lease agreement. Learning More About Distinctions Between Commercial and Residential Leases The first step in learning how to review a commercial lease agreement is to understand the distinctions between commercial and residential leases or, as they are defined under Florida law, nonresidential and residential lease agreements. The following are some important distinctions that you should know: Fewer Legal Protections The same consumer protection laws do not apply to commercial lease agreements. When you enter into a residential lease agreement, there are often a variety of consumer protection laws that prevent a landlord from engaging in certain actions or behaviors with regard to a tenant or the property. Florida law concerning nonresidential lease agreements, similar to other states, does not provide the same level of consumer protection associated with residential lease agreements. Lack of Standardization Many residential lease agreements use standard forms that have language many tenants have come to understand as a result of renting homes or apartments in Florida. Differently, most commercial lease agreements do not rely on standard forms largely because the needs of business tenants and commercial real estate owners vary widely. Accordingly, when you are drafting, negotiating, and signing a commercial lease agreement, it is extremely important to be sure that you understand each and every term in the lease and how it will apply to you. Negotiation While most residential lease agreements do not involve a significant amount of—if any—negotiation between the landlord and the tenant, commercial lease agreements are much different. To be sure, negotiation of terms is typical in commercial lease agreements. You should know that it is common to negotiate terms, such as the amount of rent, how and when rent increases will occur, the length of the lease term, and many other issues. Length of Lease In most situations, residential leases are for a one-year period. This is different for commercial leases, which typically last for more than one year (and may in fact have a lease length of several years). Binding Nature While a residential tenant may be able to include a clause in a lease that allows that tenant to terminate with a particular amount of notice (such as 60 days, for example), most commercial leases are more binding. Further, if you terminate a commercial lease early as a tenant, you may face significant financial costs. Commercial Lease Agreement Checklist When you are negotiating the terms of a commercial lease agreement, what kinds of terms do you want to ensure will be included in the contract? Since the terms of commercial leases vary widely depending upon the needs of both the landlord and the tenant, it is important to make sure that the terms of your commercial lease fit the needs of your business. For example, is the space what you need in order to set up your business? Are you permitted to install signs and other fixtures that are necessary for your company to attract customers? Is the lease term appropriate if you are just starting out and are not yet certain about the best type of space for your business? As you think about the types of lease terms you need, you should consider the following commercial lease agreement checklist: Lease term; Renewal options for the lease; Rent amount; Rent increases, or escalations, including when and how those will be calculated; Inclusion of insurance, property taxes, and other maintenance costs in your lease (or will you need to pay for these things yourself?); Amount of the security deposit; How and when the security deposit will be returned; Details of all of the space you are leasing (including, for example, rest rooms or hallways); Terms for improvements of the space made by the landlord; Modifications that are permitted; Whether and where you can hang signs; Who is responsible for paying for improvements or modifications; Accessibility issues (if you will be employing more than 15 people, the Americans with Disabilities Act (ADA) requires your business to be accessible to persons with disabilities, which may require improvements or modifications like ramps or wider doorways); Whether subleasing is permitted; Option to renew the lease; Termination of lease (e.g., notice requirements, penalties); and How disputes will be handled (e.g., mediation, arbitration). Contact a Business Law Attorney in Florida If you need assistance with a commercial lease, a Florida business law attorney at our firm can assist you. Contact BrewerLong to get started.


There are many reasons that you might decide to close a business. In some situations, the business is not profitable, and you realize that it is time to close the business. On a related note, your business may be filing for Chapter 7 bankruptcy, necessitating its closure. In other cases, however, you may have a dispute with your business partners, or you may simply want out of the business for personal reasons. Depending upon the type of business you have and your current business structure, you may not be able to simply close the business doors without attending to specific closure or dissolution requirements under Florida law. In particular, if you have a partnership, it is essential to know more about how a partnership dissolution agreement works, and what the law requires in dissolving a business partnership. Let our Orlando business lawyers assist you with your partnership agreement. What is a Partnership? If you want to end a partnership, it is extremely important to have a partnership agreement that outlines terms for dissolving the partnership. Yet in order to understand the need for a partnership agreement, you will need to know more about how a partnership work. The U.S. Small Business Administration explains that a partnership is the “simplest structure for two or more people to own a business together.” In general, there are two different kinds of partnerships, including limited partnerships (LPs) and limited liability partnerships (LLPs). In a limited partnership, one of the partners has unlimited liability while the others have limited liability. The partners with limited liability tend to have less control over the business. In a limited liability partnership, all partners have limited liability—both in relation to the business itself, as well as in relation to the actions of the other partners, according to the SBA. A partnership is a “pass-through entity,” which means that profits pass through to owners and are listed on personal income tax returns. However, in a limited partnership, the general partner with unlimited liability is required to pay self-employment taxes. Drafting a Partnership Agreement with an Eye Toward Dissolution As we mentioned, there are numerous reasons that partners pay want to get out of a partnership. Sometimes the partnership will be dissolved, while in other situations one or more partners may buy out the partner who wants to leave the business. When you start the business, it is extremely important to have a partnership agreement that outlines the type of partnership—a limited partnership or limited liability partnership—and the roles and responsibilities of each partner. In a partnership agreement, you can also make clear whether one partner can be bought out, or whether the business will need to dissolve if one partner leaves. This is often known as a “buy-sell agreement.” A partnership agreement can also clarify who is permitted to buy into the business as a new partner, and what will happen if one of the partners needs to leave the business as a result of divorce, death, or another reason. Having a partnership agreement in place from the beginning can make the process of dissolution much clearer, especially if other partners want to remain in the business and to keep it running even if one partner wants to leave. A partnership agreement can also outline the terms for dissolving a partnership altogether, but in some situation’s partnership dissolutions are handled through a separate agreement known as a partnership dissolution agreement. Dissolving a Business Altogether with a Dissolution Agreement When all partners in the business want out of the business—in other words, no partners want to remain, and the business will close—it is time to move onto a partnership dissolution agreement. This is distinct from any clauses in a partnership agreement that outline how one or more partners will be bought out or removed from the partnership while the other partners remain. A partnership dissolution agreement is essential when the business will end and the original partnership agreement did not provide clear information about how to dissolve the business. What should go into a partnership dissolution agreement? You should consider the following: Each partner’s duties with regard to dissolution; Timetable for dissolution process; How business debts will be settled; and Distribution of business assets. You can work with an experienced business lawyer in Florida to draft a statement of dissolution, ensuring that you meet all requirements under Florida law. Contact a Florida Business Lawyer If you need assistance drafting a partnership agreement or a partnership dissolution agreement, an experienced Florida business lawyer can assist you. Contact BrewerLong today to work with a business advocate.


Are you thinking about opening a business? Starting your own business in Florida can be a complicated and daunting process but being a business owner can also be extremely rewarding. While the necessary steps for starting a business can be extensive, an experienced Florida business formation lawyer can assist you. The attorneys at BrewerLong regularly assist clients as they are forming their companies. We can continue to serve your business as you seek a commercial space, negotiate a commercial lease agreement, handle employment law matters, and even if you need to consider dissolving your business. In the meantime, we want to say more about how to start a business in Florida. Develop a Business Plan The first part of starting a business in Florida involves developing a business plan. As you develop your business plan, you will want to consider many of the following: Type of service or product your business will provide; How your business will provide that service or product; Where your business will be located; Type of commercial space you plan to rent; Who will run the business; Whether you will have investors; Whether you need a license or permit to run your business; Financial goals of the business; Estimated timeline for profitability; Who your target customers might be; Who your likely competition will be; How many employees you plan to hire; Tasks for employees; and Marketing for the company. Decide on a Business Structure There are many different types of business structures from which you can choose. The U.S. Small Business Administration (SBA) provides helpful information about each available type of business structure, as well as the pros and cons for each. The following are different types of business structures: Sole proprietorship This is the easiest type of business to form, and as the SBA underscores, it gives the owner complete control of the business. One of the reasons that a sole proprietorship is the easiest type of business to form is because you can automatically have a sole proprietorship if you are engaged in business activities and if you do not specifically form another type of business. Like other businesses, sole proprietors are able to obtain a trade name. However, there are drawbacks to a sole proprietorship. Most significantly, the individual and the business are not separate—the business owner is personally liable for all business debts. To be clear, the assets and liability of the individual business owner and the business itself are not separate from one another. Accordingly, the business owner of a sole proprietorship is personally liable for business debts. Typically, a person chooses a sole proprietorship if she or he is just getting started and wants to “test out” the business before formalizing it through another type of business structure. Partnership There are two different kinds of partnerships: limited partnerships (also known as LPs) and limited liability partnerships (also known as LLPs). Both types of partnerships are similar to one another except for one major difference. In a limited partnership, there is one “general partner with unlimited liability,” who also tends to have more control over the business. The other partner(s) have limited liability and tend to have less control over the business. Limited liability partnerships are businesses in which all partners have limited liability. In a partnership, profits pass through to the partners’ personal income taxes, and limited liability partners are not required to pay self-employment taxes on the profits. Limited liability partners are not personally responsible for debts of the business. Corporation There are different types of corporations, including a “C corp,” an “S corp,” and a “B corp.” C corps are the type of corporation that most people are thinking about when they are imagining a corporation. Owners are protected from personal liability most strongly in a C corp, but there are relatively high financial costs, as well as “extensive record-keeping, operational processes, and reporting.” Corporations are separate entities from the individual business owners, but unlike partnerships, profits made by a corporation are taxed. In some situations, the profits actually get taxed twice. First, the profits are taxed when they are made, and then they are taxed again when they are paid out as dividends to individual shareholders. An “S corp” is a particular type of corporation designed to prevent the “double taxation” we just mentioned but forming one of these can be particularly complicated. A “B corp” is a particular type of for-profit corporation. In terms of taxes, it works just like a “C corp,” but it has a different purpose than a “C Corp.” In short, as the SBA clarifies, a “B corp” is “driven by both mission and profit.” Limited liability company, or LLC An LLC is a common type of business structure that has features of both a partnership and a corporation. In most cases, individual owners are protected from personal liability, and profits are passed through to the owners’ personal income without corporate taxes. At the same time, owners of an LLC do have to pay self-employment tax. Give Your Business a Name and Establish It Legally Florida law has specific requirements for naming corporations, LLCs, and partnerships. In short, you will need to check with the Florida Division of Corporations to determine whether there is an entity that already has the name of your planned business. You will also need to do a trademark search to ensure that the name you have in mind for your business has not been trademarked. Then, you will need to establish your business as a legal entity. An experienced Florida business lawyer can help with these complicated steps. Register Your Company in Florida To register your business, you will need to provide specific information to the Florida Department of State. The particular type of documents you need to submit depend upon the type of business structure you have chosen. Determine Whether You Need a Permit or License If you need any type of permit or license, you will need to get it before you officially open your…


Starting a business takes a lot of time, and so does closing one. We wish it were as easy as turning off the lights and notifying the post office to stop delivering mail but closing a business in Florida requires several steps to protect yourself legally. We are happy to help. To wind down a business, you need to notify certain stakeholders that the business will cease to exist, which protects you from future lawsuits or incurred costs. The steps you take are generally the same whether you are running a large business with 100 employees or are a sole proprietor working out of a home office. As experienced Florida business law attorneys, we have written this article on how to close a business in Florida to give you a general idea of the work involved. Vote to Wind Down, if Necessary If you run a corporation, then your shareholders will need to vote to formally wind down the business. They also need to do this at a formal shareholder meeting. Avoid sending out an email or a form letter asking people to let you know if they want to wind down.  Hold an official meeting and keep records of the vote. Don’t skip this step. If you do, you could end up financially and legally liable to customers, employers, the IRS, and other government agencies. For example, a customer could allege that your business was really a sham since you don’t follow required formalities to shut it down. That could put you on the hook financially for business contracts and other debts. If you run a sole proprietorship, you don’t need to vote. But you still should carefully document the date that you have decided to stop operating your business. Notify Employees If you don’t have employees, you can skip this step. However, if you have hired full- or part-time employees, you must do the following: Give them clear notice of when their employment terminates. By shutting the business you are, in effect, laying someone off. Coordinate to pay the final paycheck in a timely manner. Florida has deadlines you need to follow. Make sure to compensate employees for unused vacation time. Deal with retirement accounts. Contact the investment company for more information. A key consideration is timing. As soon as you tell an employee you are closing the business, they might immediately jump to a different job. You might need only a skeletal crew working for you as you wind down. Pay Your Creditors A business that is winding down still needs to pay its creditors back. This means you can’t sell your business or its assets and then skip town with the proceeds. Instead, go through your contracts, both short-term and long-term. Identify how much money you need to pay off your debts and make sure you set an adequate amount aside. If the contract gives you a right to early termination, make sure that you exercise that option. What happens if you don’t have enough money to pay all creditors? Realize that they can come after you if you made a personal guarantee on a loan. (This happens more frequently than you probably imagine.) Talk with a business attorney for more information. You might need to file for bankruptcy to wipe out the debts. Pay Your Taxes Notify the IRS and the Florida Department of Revenue that you are closing your business. If you don’t, they might assume you are hiding business income and they could open an investigation. You also need to make all necessary payroll and other contributions, exactly as you did before the winding down process. If you don’t have the money, then a business bankruptcy might be your only option for handling unpaid tax debt. Close Your Bank Accounts Once all checks and transfers have cleared, you should close your accounts. Don’t close too early or checks will bounce. If you have cash in the account after paying off all debts, you will then distribute it to any shareholders. Notify the State You Are Winding Down The state needs to know that the business has closed. This protects you by preventing someone from fraudulently assuming your business identity and doing business with unwary creditors. Fill out the necessary paperwork and keep a copy for your records. Hang onto Business Records Many of our clients have successfully wound down a business only to have an issue crop up years down the road. Maybe the IRS claims they are owed money, or a creditor sues for additional payment. For these reasons, you must keep all your business records, in order, in a safe place. Speak to a Business Lawyer Today Closing a business in Florida isn’t easy, and it is rife with pitfalls. If you have a question, our Florida business lawyers can answer. Brewer Long has helped many business’ owners wind down, and we can help you too. Contact us today for a free, introductory phone call, 407-660-2964.

You’re starting a business and you need a commercial location. Or maybe your business is growing and you need more space. Whatever the case, if you’re about to navigate the legal and financial minefield of a commercial lease, have an experienced attorney review the document before you sign. Here are three critical reasons why: 1. Complex zoning issues. Before you sign a lease, be sure the city and county zoning will allow you to operate your business on the site. Don’t just assume—verify. If you sign a lease without confirming the zoning, you risk being locked into years of rental payments on property you can’t use. Zoning ordinances can be tedious and nuanced. They address a wide range of issues, including the type of business (retail, restaurant, manufacturing, professional, etc.), health and safety regulations, parking, signage, accessibility and more. Check into all applicable regulations before making a commitment. If the current zoning doesn’t allow what you want to do, you may be able to obtain a variance or special exception. An attorney can help you negotiate a zoning contingency into the lease and navigate land use issues with the appropriate government agencies. 2. Terms that heavily favor the landlord. It’s likely that the landlord uses a lease has been drafted to favor the landlord and contains language that burdens the tenant with a long list of significant obligations, expenses and liabilities. For example, many landlord leases contain broad remedies the landlord can self-execute if you default on the lease while limiting the landlord’s liability or your recoverable damages if the landlord defaults. Another issue to watch for is when landlords use a standard form that contains generic terms that are not appropriate for your particular business or industry. An attorney can often negotiate a more balanced agreement that is specific to your needs and operation. 3. Get all promises in writing. In your conversations, the landlord or leasing agent may agree to certain things that are important to you, but if those points aren’t included in the written lease you sign and a dispute arises later, you have no recourse. Don’t rely on verbal assurances. An attorney can craft the appropriate language for points you need added to the lease. Be wary of a landlord who objects to your attorney reviewing their lease or who insists there is no room for negotiation. In our experience, even landlords who have a “take it or leave it” attitude become more reasonable and cooperative after they receive an attorney’s comments on the lease. Contact BrewerLong Today for A Commercial Lease Review Commercial leases are complex. An experienced contract attorney knows which lease terms are standard, which can be negotiated and which should be added to the landlord’s draft to limit your costs and liabilities, reduce risks and facilitate a smooth landlord/tenant relationship. To schedule review of a commercial lease, call our office at 407-660-2964, contact us online, or email Calla Portillo at

What Should You Do if You Get Sued? When you own a business, getting sued is not a matter of if, it’s a matter of when. The more successful you are, the greater the chances that someone will file a lawsuit against you or your company. That’s why you need to know what to do before you hear that dreaded phrase: “You’ve been served.” First and most important: Don’t panic. Stay calm and take purposeful and immediate action. Here’s what you should do—and you should do it immediately (the same day if possible) after you are served: Read the lawsuit. You need to know who is suing you and what they allege you did or did not do. The summons will tell you the exact number of days you have to respond to the lawsuit so you know what your deadline is. Call your attorney. Even if you believe that your insurance company is going to handle your defense (more about that later), your own trusted legal advisor should be notified and kept advised as the case progresses. Put your insurance carrier on notice. Let your commercial insurance agent/broker know you have been served with a complaint. He or she will give you instructions on how to notify the insurance carrier and may assist directly in placing the carrier on notice of the claim. Important! Regardless of the nature of the claim or claims alleged in the complaint, never assume that your insurance doesn’t cover that type of claim. Notify your carrier even if you think it’s an uninsured risk because you could be wrong. Let your insurance carrier tell you whether some or all of the claims asserted against you are covered under your policy. Designate a Point of Contact Once you have contacted your attorney and placed your insurance carrier on notice of the claim, you should designate an individual within the company to be the primary point of contact for all things related to the lawsuit. Your internal point of contact should be a C-level or department-head person who reports to the CEO. This person should have the necessary authority as well as the time and ability to deal with the lawsuit. It should not be the CEO; the CEO needs to stay focused on running the company. Preserving Evidence Upon receipt of a complaint, meet with all of your department heads—particularly your IT department head—and put procedures in place to securely preserve all data which might in any way relate to the lawsuit. Contact a business litigation attorney if you’re unclear on any detail about your obligations and the process for preserving evidence. The failure to preserve data can have significant negative implications for you in the litigation. Insurance Coverage A standard insurance policy issued to business entities will protect them against liability claims for: Bodily injury (BI) and property damage (PD) arising out of premises, operations, products, and completed operations Advertising liability Personal injury (PI) liability Risks related to contracts and business relationships with partners are usually not insured. You may choose to purchase additional coverages such as employment practices liability, which provides coverage to employers against claims made by employees alleging discrimination (based on sex, race, age or disability, for example), wrongful termination and harassment, as well as other employment-related issues, such as failure to promote. The terms of your policy dictate whether claims or losses are covered. When it comes to lawsuits, there are two significant components to insurance: Providing a legal defense Paying any damages. Upon receipt of your claim, your insurance carrier will take one of three actions: Advise you that the claim is covered and the insurance carrier will provide a defense. Advise you that the insurance company believes that the claim may not be covered under your policy and they are going to reserve their rights to deny coverage later, but they are currently going to provide a defense. Advise you that the insurance company is denying coverage for the claimed loss and that they are not going to provide a defense. Once you have a statement from your carrier on the status of coverage, you will know what you are facing. The Value of Business Counsel with a Knowledge of Insurance Coverage As counsel who has experience in business litigation and insurance coverage, we can be a crucial resource to you from the moment that you are served. Having a knowledgeable attorney involved in the communications with your insurance carrier can influence the carrier’s decision in close cases. Additionally, if you find yourself with a limited amount of coverage, we have had success in getting insurance carriers to assign us as litigation counsel. That way, you can utilize the insurance dollars to defend, and maybe settle, the claim up to the amount of the coverage, and then transition to the self-paid defense of the claim with counsel that you know and trust. We can also assist you with understanding and evaluating your various layers of insurance coverage in advance of a claim. This is a service we routinely provide our clients. We’ll help you be sure you have the right coverage in the right amounts to cover both defense costs and damages. We’ll evaluate coverage limits, overlapping coverage, excess coverage (which picks up the cost of risks you’re not otherwise insured for), deductibles and more. Even though you may have a knowledgeable, trustworthy agent, it’s worth having someone who knows what’s happening in the legal world take a look at your situation. To schedule an insurance coverage review, call our office at 407-660-2964 or email Calla Portillo at

These 10 points will help you build a Board that can take your company to the next level. Representative Democracy.  The primary purpose of the Board of Directors is to represent the shareholders, to protect their investments, and to ensure that they receive an adequate return.  Directors are elected by the shareholders to serve terms of one or more years, concurrently or staggered, as provided in the Bylaws. The Big Picture.  The Board of Directors is the highest governing authority in a company.  It is generally the Board’s job to hire, oversee and approve compensation for the Chief Executive Officer and other executives, to approve payment of dividends, and to recommend for or against major transactions affecting the shareholders. One Director, One Vote.  Actions and decisions of the Board of Directors generally require the vote of a majority of the directors.  The Bylaws might require a supermajority or unanimous approval for certain decisions.  The Board may hold live or telephonic meetings (at which minutes must be kept), or they may sign written resolutions in lieu of a meeting. Caring Souls.  Directors owe a duty of care to the company and shareholders.  They must act in an informed and deliberate manner.  Directors should have a good working knowledge of the business, its plans, and potential problems.  The Board should avoid not only haste but the appearance of haste. Trust But Verify.  In exercising their duty of care, directors may rely on information and advice provided by company executives, managers, and employee, as well as outside experts, such as attorneys, CPAs, and investment bankers.  But directors should actively question and test the information and advice they receive. Always Be True.  Directors also owe a duty of loyalty to the company and shareholders.  They must make decisions based on the best interests of the company, and not any personal interest.  Directors must first offer to the company any opportunity to that is related to the business of the company. Cured.  A director has a conflict of interest when he or she has a personal interest in a transaction to be approved by the Board.  The conflict may be “cured,” and the transaction upheld, provided the conflict is known to the disinterested directors of shareholders who approve the transaction. Inside Out.  Directors who are also employed by the company are known as “inside directors,” while independent directors are known as “outside directors.” In some sense, inside directors always have a conflict of interest (their paychecks).  For this reason, it’s good practice for the Board to have a majority of outside directors (this is generally a requirement for publicly traded companies). Committee Time.  Especially when the Board of Directors has a large number of members, it is often more effective for directors to act and make decisions in committees made up of a small number of directors.  Committees are created to focus on specific topics, like executive compensation or finances.  A committee of independent directors can be used to approve decisions for which inside directors have a conflict. Personal Judgment.  Directors are not personally liable for losses suffered by the company or the shareholders, provided they have met their duties of care and loyalty.  Even if the directors’ decisions turn out to be unsuccessful or unwise, the directors are generally protected under the so-called business judgment rule.

What you need to know before including stock options in your employee incentive program. A Range of Options. Stock options are just one form of employee incentive, all of which are intended to encourage key employees to make the company successful.  In evaluating the alternatives, there are two important questions:  What will incentivize the employees?  How much ownership should the employees have?  Don’t Believe the Tax-Free Hype. Incentive stock options (ISOs) are popular because they are believed to be tax-free for the employees.  They’re not, in most cases.  When ISOs are exercised, the “spread” (the difference between the exercise price and the fair market value of the stock) may not be subject to ordinary income tax, but it is subject to the alternative minimum tax (AMT).  Also, when the stock is sold, the employee must pay capital gain taxes on the difference between the exercise price and the sale price. Through the ISO Hoops. To avoid ordinary income tax on the grant and exercise of ISOs, specific requirements must be met.  At the time ISOs are granted, the exercise price cannot be less than the stock fair market value.  ISOs must be exercised within ten years of being granted.  After exercise, the option stock cannot be sold until two years after the date the option was granted and one year after the date the option was exercised. The Trigger Trap. Often the event that triggers the exercise of ISOs is a sale of the company.  But exercise-and-sale as part of a company sale means that the employee cannot satisfy the two-year-from-grant and one-year-from-exercise holding requirements.  As a result, the employee must pay ordinary income taxes on the difference between the option exercise price and the stock sale price.  Plain Vanilla Options. Options that are not intended as ISOs are called non-statutory options (NSOs).  Generally, the employee pays ordinary income taxes on the value of the options at the time they are granted, and the employer gets an immediate deduction for the same amount.  There is no required time limit on when NSOs can be exercised, and there are no holding requirements. Restrictions May Apply. An alternative to options is restricted stock.  Key employees are given company stock directly, but there are restrictions on voting rights, sharing in profits, or whatever the employer decides.  However, the tax laws applicable to S corporations only permit restrictions on voting.  Like NSOs, the employee generally pays ordinary income taxes on the value of the restricted stock at the time it is granted, and the employer gets a deduction.  Tax Timing. Ordinary income taxes on NSOs and restricted stock can be delayed if they are subject to substantial risk of forfeiture.  For example, restricted stock may be forfeited if the employee’s employment is terminated.  The restricted stock would not be taxed until it becomes vested.  However, the employee might choose to pay the tax early, by making an 83(b) election, if the stock is expected to go up in value. Real, Live Stockholders. Employees who exercise options or receive restricted stock are real stockholders.  They are entitled to view the company books, to vote on directors and significant transactions, and they are owed fiduciary duties.  The employer can impose some restrictions, but some stockholder rights by law cannot be limited. A Ghostly Alternative.  Another alternative is “phantom stock.”  Phantom stock is not actually stock at all.  Instead, it is a promise to pay bonuses based on increases in the value of the company stock.  Phantom stock avoids the complexity of ISOs and the stockholder rights of options and restricted stock.  On the other hand, phantom stock may not incentivize employees as much as would stock ownership.  If the name phantom stock isn’t scary enough, they’re also called stock appreciation rights (SARs).