Whether you are starting a small business or running an established company, it is vital to understand business laws and regulations. But that is easier said than done. My goal is to provide business-related legal services so that you can spend more time dealing with the actual business and less time with legal intricacies of operating your business. My services include:


Business formation

You have a new and innovative product or service and you are interested in forming a new business. You may have concerns about liability, taxes, investors and other considerations. As your small business lawyers, we will assist you in deciding whether your startup business should organize as a limited liability company (LLC), partnership, S corporation or C corporation. We will form the most appropriate business organization for your new business and register the business in all jurisdictions in which it will conduct business.


Mergers and acquisitions

If your business is fortunate to thrive and become a merger or acquisition target, we can represent you as the seller; or if you are on the other side and looking to acquire a business, we can assist with the due diligence in purchasing a business. We will review various approaches in purchasing a business through merger or acquisition. We will discuss with you various structures in purchasing the stock or purchasing the assets of an acquisition target. In either case, your business will need thoughtful and comprehensive representation in all aspects of a merger or acquisition.


Government contracting

Government contractors face numerous issues when contracting with the government. And with a hands-on approach and substantial experience, we will help you navigate those legal issues. We prepare teaming agreements, subcontracts and joint venture agreements and can handle a variety of other government contract matters. As government contract lawyers for your small business, we can assist you in applying for programs for HUBZones, service-disabled veteran-owned small businesses or women-owned businesses. If your company is facing debarment or suspension because of allegations of corruption or bribery, we can assist in your defense before the U.S. government or the World Bank.


Business transactions

Once you have an ongoing business, however organized, you will have a host of various commercial transactions. We prepare agreements with lenders, lessors, partners, customers, employees, and consultants. We provide business legal services for your company, preparing confidentiality agreements, nondisclosure agreements, licensing agreements, distribution, employment agreements, independent contractor agreements, lease agreements, and many others. We will help you understand what each part of these agreements require and make sure that these agreements provide protection to you and your business.


Corporate law

Once your startup business has been created, your company will have ongoing requirements to maintain its separate status. We will assist in guiding you on how to prepare corporate minutes or resolutions of the company to maintain the corporate form and other steps to protect the limited liability of your company. You will also have to make sure that your bylaws or operating agreement continues to reflect the needs of the business organization. We are available to assist you in addressing these issues. And once your company is ready to raise additional capital from investors, we can work with you to determine whether you are subject to securities laws or fall within one of the exemptions.


Business disputes

Few businesses are immune to business disputes. If your small business was well-advised, you have an agreement that will provide guideposts on how to resolve your business dispute. If you are unable to settle your dispute, you may have a dispute resolution mechanism such as mediation or arbitration in the agreement. An alternative dispute resolution mechanism such as arbitration or mediation generally can provide a relatively quick resolution of your business dispute. If not, then you may have to consider litigation. We handle business disputes, including pre-litigation matters, mediation, arbitration and litigation.


Anti-corruption compliance

Every company should have procedures and policies to minimize its exposure to allegations of corruption or bribery. An integrity compliance program (ICP) is essential for businesses doing work internationally for the United States government or work financed through one of the development banks. We can assist in reviewing or preparing an ICP to assure that is consistent with the anti-bribery and anti-corruption guidelines from the World Bank. If your company is facing debarment or suspension because of allegations of corruption or bribery, we can assist in your defense before the U.S. government or the World Bank.


Non-profit law

We work with organizations to obtain their tax exempt status under Section 501(c)(3) of the Internal Revenue Code. There have been recent changes to obtaining 501(c)(3) status and we have worked with organizations in submitting successful applications on the simplified track by filing a 1023-EZ and the more rigorous 1023 application for larger organizations. Nonprofits also face similar legal challenges to assure that they comply with business requirements and additional requirements to assure that they do not jeopardize their tax exempt status. As a law firm for nonprofits, we work with nonprofit organizations to guide them through these issues.

FAQ Small Business Attorney in DC

What is considered a small business?

Almost all our clients fall within the definition of small business/startup as determined by the Office of Advocacy of the U.S. Small Business Administration. Under this definition, a small business has fewer than 500 employees. Small businesses encompass about 99.9% of all business organizations in the United States.

Which industries do you serve as a small business attorney?

Most of our clients are service providers such as consulting companies, law firms, accounting and bookkeeping services, cybersecurity consultants, video production companies, and lobbyists, just to name a few. We also represent foreign and domestic manufacturers and software developers.

As a small business lawyer in DC, we represent some retail operations, such as bookstores and restaurants. We also represent numerous nonprofits with varying missions. Our government contractors clients hold various IDIQs (Indefinite Delivery, Indefinite quantity Contracts) and GSA schedules.

In which areas of the law does a small business or startup need legal assistance?

Most times, small businesses/startups need the services of outside general counsel. As outside general counsel for small businesses, we can handle most matters as a small business attorney that small businesses generally encounter. Usually, anything with the word agreement or contract is within our practice areas. This includes operating and shareholder agreements, which are used for small businesses and startups that are formalizing their relationships with their owners. Once a business is formed, then we prepare and review a host of other agreements, such as service agreements (which may be referred to as client agreements or consulting agreements), independent contractor agreements (which may be referred to as subcontracting agreements), employment agreements, teaming agreements, purchase and sale agreements, merger agreements, option agreements, license agreements, lease agreements, and the list goes on.

What factors should a small business and startup look for in retaining the services of a lawyer for small businesses?

With our extensive experience of working as a small business attorney in DC for decades now, background and experience should come right at the top of the list when looking for a small business lawyer. We think that accessibility and communication are essential for a successful relationship between an attorney and a client. Hourly rate is important but not as important as quality of service.

What kind of experience do you have in advising small businesses as an attorney?

Keith Rosten has not only legal experience but also business and practical experience that allows him to relate to the trials and tribulations of a small business owner. Keith has BigLaw experience before working for small and medium-sized businesses, first at his own law firm focused on small businesses and then with Berliner Corcoran & Rowe LLP.

Keith has substantial business experience. He received an MBA from the Tuck School at Dartmouth College. During his business studies, he worked on several group projects with small businesses, including a furniture manufacturer, a manufacturer of leak location precision equipment, real estate developer. After business school, Keith operated a successful real estate business in California and overcame numerous issues, such as asbestos abatement and underground storage tank remediation.

Keith worked as a legal adviser to a government contractor and was a legal adviser to a major initiative in Russia. Keith ran another small business, selling and marketing solar energy equipment. The business had an e-tailer component, hosted the largest solar energy forum online, and sold solar energy equipment to the government. Keith negotiated two GSA schedules for the business and obtained HUBZone certification for the business. Keith was also president of the Dartmouth Entrepreneurial Network – Washington, a networking organization for small businesses in the greater Washington, DC community.

Keith has also volunteered for Compass Pro Bono, working with local business professionals to conduct long-term consulting engagements for local nonprofits in fundraising, governance, and strategy.

With this breadth of legal and business experience, Keith is attuned to some of the challenges facing small businesses, which allows him to provide effective advice and guidance.

As a small business lawyer, do you take in-person meetings only?

Yes. We are located in downtown Washington DC and host many of our clients. For those clients who cannot come into our offices, we usually meet over Zoom or by telephone.

How do you charge for your services as a small business attorney?

We charge our clients based on hourly fees. We usually provide a budget of how much certain matters cost so that startups and small businesses know in advance the ballpark cost of the matter.

What if a client does not like our services?

Clients can terminate our services anytime if they don’t find it satisfactory.

Should my small business lawyer or startup lawyer be in the same state as me?

No, not always necessary and may depend on multiple factors. For example, though we are an expert small business lawyer in DC, we have also provided consultation to other cities’ clients.

T 202-741-9190 Einfo@rostenlaw.com
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M&A Lawyer in Washington DC

Keith Rosten

Business M&A legal services

If your business is a merger or acquisition target, we can represent you as the seller; or if you are on the other side and looking to acquire a business, we can assist with the due diligence in purchasing a business. In either case, your business will need thoughtful and comprehensive representation in all aspects of a merger and acquisition. We will help our clients along every step of the transaction: we will help in the structure, documentation, negotiation, and closure of the transaction as well as conducting due diligence as the deal progresses.

If your business becomes a merger or acquisition target, we will help you work through any technical details mentioned in a letter of intent, and we will help you through the process as you deal with accountants, tax advisors, and other professionals. And, if you seek a business merger or acquisition, we will help you draft a letter of intent and decide on the best choice among a merger, an asset purchase, or an equity or stock purchase.

And if you do choose to make an asset purchase, we will assist you in trying to exclude assets that may not be germane to the business or may carry liability, and to exclude liabilities or other contractual relationships that do not pertain to the acquisition; we will work with you to figure out all of the details of the transaction, including isolating the specific assets and liabilities that pertain to the asset, transferring employees, transferring permits and licenses, and drafting non-compete agreements.

Indeed, regardless of your position in a merger or acquisition, we will help you along at every step of the way. We have more resource materials on purchasing or selling a small business and on mergers and acquisitions here.

Client engagement process

Legalities are already complex, interacting with your lawyer shouldn’t be

Client Contacts BCR

Initial Consultation

BCR Conducts
Conflicts Check

Engagement Letter
Signed

  • Client Remits Retainer
  • Client Uploads Relevant Documents

Introductory Call

  • Prioritize Client Needs
  • Agree On Timeline
  • Discuss Budget

Engagement

Termination
of Engagement

Client Experience

We represent both sellers and buyers of small businesses in mergers and acquisitions. In our experience, one out of every two M&A transactions does not close even after a letter of intent is executed. In our representations, we try to increase the probability that the transaction will close by extensively negotiating the LOI and address areas in which disagreements frequently occur during the negotiations for a purchase and sale agreement.

The areas in which the parties may face disagreement differ from transaction to transaction, but some of the more frequent difficult issues that may arise are: assignment of leases, employee transition, vendor relationships, inventory and working capital. In most of the transactions, the purchaser has already lined up its financing, and since we are talking about small businesses. The source of financing is often a SBA 7(a) loan.

We have recently represented the buyer in the purchase of a bookkeeping business. The client intended to buy the business and then merge the business with other existing businesses. The transaction was structured as an asset purchase. The majority of small business acquisitions are structured as asset purchases. The parties readily agreed on a purchase price and our client was able to obtain a 7(a) loan. The major issues in the negotiations for the purchase and sale agreement was employment of the current employees and a non-compete for the seller. The purchase of the business closed generally in line with the parties’ expectations.

We represented another buyer in a transaction involving a retail business operating in three separate states under two different corporate structures. The transaction was also structured as an asset purchase. The parties extensively negotiated the letter of intent, which made the preparation of the acquisition agreement flow more easily. There were numerous issues, however, that delayed the closing, starting with ownership of the selling entities. The selling entities were owned by different individuals and the seller had to assure that all of the consents were in place before signing the purchase and sales agreement. There were numerous complicated and cumbersome transition issues that had to be negotiated, including assignment of leases, employee transition, working capital and inventory and others. Despite the challenges, the transaction closed. read more…

FAQs – Mergers and Acquisitions Law

When should I hire a M&A lawyer for representation in the purchase or sale of a business?

The short answer is as soon as possible. You should retain the services of a M&A attorney as soon as you are seriously considering acquiring or selling an existing business. This means you should retain the services of an acquisition lawyer or M&A law firm before ever signing a letter of intent. An M&A lawyer can provide valuable assistance in assisting in structuring the purchase and sale of a small business before you sign a letter of intent.

What is the process for a small business owner selling their business?

There may be both personal and business considerations to persuade a small business owner to sell their business. Once the small business owner makes that decision, they need to get an idea of the value of the business. They may already have a valuation in connection with non-qualified deferred compensation plans, which require what is known as a 409A valuation (Section 409A of the Internal Revenue Code). If not, there are many metrics to assist in determining the value of the business, including earnings before interest, taxes, depreciation, and amortization (EBITDA), which may be the most common metric.

Very small businesses with revenues under a million dollars in revenue may use seller’s discretionary earnings (SDE) to determine the value of the small business. A business owner may also consider a valuation expert to assist in determining the value of the business. Your M&A lawyer or the M&A law firm if hired early will guide you through the process while maintaining compliances.

As an M& A lawyer, what documents do you recommend that a small business owner should compile in preparation for the sale of a business?

During this process, a small business owner will need to start compiling the numerous documents that potential buyers will want to review during the due diligence process. These documents will include the corporate documents, major contracts, financial instruments, the lease or ownership document, licenses and permits, employment and independent contractor agreements, documents reflecting the intellectual property of the company, state and federal tax returns, social media accounts, financial statements and others.
When we are engaged as an acquisition lawyer, we facilitate a checklist of documents to prepare in advance for the process and to comply with the merger and acquisition law.

What role does due diligence play in the process of purchasing a business in merger and acquisition?

Due diligence plays a crucial role in the business purchasing process as it involves a comprehensive investigation and analysis of the target business. Due diligence starts before the letter of intent and is conducted through execution of the purchase agreement. There are numerous aspects of the due diligence process in which your lawyer will play a role. Due diligence assists with identifying potential risks and liabilities, securing financing, as some lenders or investors require thorough due diligence reports, and compliance and legal protection. When our merger and acquisition law firm is hired to manage the process, we ensure that due diligence is thorough to avoid any challenge at a later stage.

What is a letter of intent and how does it differ from the purchase and sale agreement?

Once a prospective buyer is interested in purchasing the business, the parties will generally sign a letter of intent outlining the major terms of the proposed transaction. A letter of intent is usually only a few pages long. Although most of the provisions in a LOI are not binding, a letter of intent locks in the structure of the deal and major deal points. A letter of intent indicates that the parties are on the same page, and for that reason, as an M&A lawyer, we recommend spending time to negotiate and agree in the letter of intent on not only the price, but also other major issues.

Many transactions will never close and it is in the interest of both the purchaser and the seller to recognize insuperable issues as early on in the process as possible to save considerable time, energy and, yes, attorneys’ fees.

After the execution of the LOI, the buyer then will generally further due diligence either himself or using an acquisition attorney before the parties negotiate the final purchase and sale agreement. The parties sign the purchase and sale agreement before or sometimes simultaneously with the closing of the transaction after vetting by M&A lawyers of both the parties.

In merger and acquisition law, what is the difference between an asset purchase and a stock purchase?

An asset purchase involves the sale of the assets used in connection with the operations of the business. The purchaser is a company or creates a new company, which receives the assets from the selling business. The assets may include the equipment, inventory, vehicles, and sometimes real estate. In a service business, the seller assigns the contracts from the business to the purchaser. In an asset purchase, the seller needs to convey the assets to the buyer. The seller conveys the computers, the equipment, the website, the trademarks and other intellectual property and all other property used in connection with the business.

In a stock purchase, the purchaser is buying the shares of stock of the company (for a corporation) or membership interests (for a limited liability company). The seller, which is the owner of the stock, will convey the ownership interests in the company to the buyer.

In general terms, the buyer in the purchase of a business wants an asset purchase, because the buyers wants to buy the assets of the target business, not its liabilities. Moreover, the buyer can obtain a stepped-up basis in the assets, which is favorable to the buyer from a tax standpoint.

According to you as an expert M&A lawyer, is it possible to sell goodwill separate from the purchase and sale agreement?

Yes. It is important to distinguish between personal goodwill and goodwill of the business. Goodwill of a business is considered to be the amount paid for a business over the fair market value of the business’ assets. A seller may sell the seller’s personal goodwill, separate and apart from the goodwill of the business. You would most often encounter a goodwill sales agreement in connection with the sale of a C corp as it allows the seller to avoid double taxation.

How does a seller maintain the confidentiality of information during the sale of a business?

For the seller of a business, maintaining confidentiality throughout the process of selling a business is critical for the seller. They should take appropriate measures to protect their information while also marketing and identifying prospective buyers. It is important to have a confidentiality agreement done by the M&A lawyer, but the seller should keep in mind that it may be difficult to enforce a non-disclosure agreement. Even with a confidentiality agreement in place, the seller does not want to release confidential and proprietary information at an early stage–and especially if the prospective buyer is a competitor. You should consult with an M&A attorney about how to stage the release of information. The seller may not want to share highly proprietary information with a prospective buyer until the parties have signed a letter of intent or even wait until they have entered into a purchase and sell agreement.

Besides an M&A lawyer, what other professionals may be able to provide support during the merger and acquisition process?

The merger or acquisition process often involves various professionals with specialized expertise. Tax advisers or accountants play a crucial role in mergers and acquisitions transactions by providing financial due diligence, analyzing financial statements, and assessing the financial health of the target company and assisting in structuring the transaction to minimize the tax burden on the parties. Depending on the nature of the transaction and the industry involved, compliance professionals may be consulted to ensure compliance with applicable laws, regulations, and industry standards. Tax advisors help identify and analyze the tax implications of the merger or acquisition, they can provide guidance on tax structuring and tax consequences. Your mergers and acquisitions lawyer can act as a central point of coordination, facilitating effective communication and collaboration among these professionals and ensure that all aspects of the transaction are aligned and properly addressed in the legal documentation. By working collaboratively, they can achieve a seamless and successful transaction while protecting your legal and financial interests.

Can my M&A lawyer assist in transition planning?

Yes. Even before a small business owner locates a buyer, they should develop a transition plan with a merger and acquisition attorney to consider the needs of employees, customers, landlords, and other stakeholders during the transition period. Each small business sale is unique, and these considerations may vary depending on the specific circumstances. Seeking guidance from experienced M&A legal expert can provide small business owners with the necessary expertise and support to navigate the sale process effectively and achieve a successful outcome.

As an M&A lawyer, can you assist a foreign buyer in purchasing a U.S. business? Are there special issues that a foreign buyer should be concerned with when purchasing a U.S. business?

There are specific legal considerations that need to be considered when a foreign company is planning to acquire a U.S. business. Considerations prior to the acquisition process include, tax implications, data privacy and security, cultural and language considerations, and regulatory compliance, which means that foreign businesses need to comply with various United States laws. In certain circumstances there may be a voluntary or mandatory review by
The Committee on Foreign Investment in the United States (CFIUS). You will need an acquisition attorney or an M&A law firm experienced in cross-border transactions and understanding of the legal complexities involved in acquiring a business based in the United States as a foreign. Your lawyer should be able to provide tailored advice, guide foreign businesses through the process, and ensure compliance with the laws and regulations of the United States, ultimately facilitating a successful acquisition.

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