Saturday, December 26, 2009

What is Crime Involving Moral Turpitude (CIMT)?

Moral turpitude generally refers to conduct which is inherently base, vile, or depraved, contrary to the accepted rules of morality and the duties owed to persons or society in general. See Matter of Flores, 17 I&N, Dec. 225 (BIA 1980), and cases cited therein. It is defined as conduct which is morally reprehensible and intrinsically wrong, the essence of which is an evil or malicious intent. In determining whether a crime is one that involves moral turpitude, one must look to the nature of the offense itself.  See Matter of Esfandiary, 16 I&N Dec. 659 (BIA 1979). Additionally, whether or not a crime is a CIMT often depends on whether or not a state statute includes one of the elements that introduces moral turpitude. A crime with the same name may be a CIMT in one state but not in another if the state statutes define the crime differently. Conspiracy to commit a crime considered a CIMT is also a CIMT in itself.
The general categories of crimes which involve moral turpitude contained in this reference guide are as follows:
  • Crimes against a person. Crimes against a person involve moral turpitude when criminal intent or recklessness is an element of the offense, or when the crime is defined as morally reprehensible by state statute, e.g. statutory rape. Criminal intent or recklessness may be inferred from the presence of unjustified violence or the use of a dangerous weapon.
  • Crimes against property. Moral turpitude attaches to any crime against property which involves fraud, whether it entails fraud against the government or an individual. Certain crimes against property may require guilty knowledge or an intent to permanently take property. Theft (petty and grand), forgery, and robbery are CIMTs in some states. Possession of Burglary Tools and Loan Sharking are usually not CIMTs.
  • Sexual and family crimes. It is difficult to discern a distinguishing set of principles which the courts apply to determine whether a particular offense is a CIMT. In some cases, the presence or absence of violence seems to be an important factor. The presence or absence of criminal intent can be a determining factor. Spousal abuse and child abuse can be CIMTs. For example, the Simple Assault, Domestic charge used by some states generally does not rise to the level of being a CIMT. Indecent Exposure and Abandonment of a Minor Child are also not CIMTs in some states.
  • Crimes against the authority of the government. The presence of fraud is the main determining factor as to the presence of moral turpitude. Offering a Bribe to a Government Official and Counterfeiting are CIMTs. Possession of Counterfeit Securities (Without Intent) and Contempt of Court are not CIMTs.

Thursday, December 24, 2009

Good Moral Character-What is it and how it affects Immigrants!

Generally, an applicant must show that he or she has been a person of good moral character for the statutory period (typically five years or three years if married to a U.S. citizen or one year for Armed Forces expedite) prior to filing for naturalization.

The Immigration Service is not limited to the statutory period in determining whether an applicant has established good moral character. An applicant is permanently barred from naturalization if he or she has ever been convicted of murder.

An applicant is also permanently barred from naturalization if he or she has been convicted of an aggravated felony as defined in section 101(a)(43) of the Act on or after November 29, 1990. A person also cannot be found to be a person of good moral character if during the last five years he or she:

· has committed and been convicted of one or more crimes involving moral turpitude,

· has committed and been convicted of 2 or more offenses for which the total sentence imposed was 5 years or more,

· has committed and been convicted of any controlled substance law, except for a single offense of simple possession of 30 grams or less of marijuana,

· has been confined to a penal institution during the statutory period, as a result of a conviction, for an aggregate period of 180 days or more,

· has committed and been convicted of two or more gambling offenses,

· is or has earned his or her principle income from illegal gambling,

· is or has been involved in prostitution or commercialized vice,

· is or has been involved in smuggling illegal aliens into the United States,

· is or has been a habitual drunkard,

· is practicing or has practiced polygamy,

· has willfully failed or refused to support dependents, and

· has given false testimony, under oath, in order to receive a benefit under the Immigration and Nationality Act.

An applicant must disclose all relevant facts to the Service, including his or her entire criminal history, regardless of whether the criminal history disqualifies the applicant under the enumerated provisions.

It is critical to consult with an experienced attorney who understands immigration consequences of criminal conviction if one is an immigrant or on path to green card or citizenship. Typically, two lawyers or one lawyer who is fully knowledgeable is needed and hired.

Mechanic's Lien and respective rights of homeowner and contractor

In California, as in most states, any person or company (contractor or sub-contractor) that works on property has a powerful tool to make sure they are paid: the mechanic's lien. Liens are authorized as a matter of right in the California Constitution.

If the property owner does not pay for construction work, the contractor may record a document that gives notice of its Claim of Mechanic's Lien against the property. The document is recorded with the Recorder in the county where the property is located and will be a cloud on title to the property, signifying to the world that a contractor believes it is entitled to draw the dollar amount of its claim from the equity in the property. Depending on the type of contractor and whether the owner has recorded certain notices that construction is complete, the contractor has either 30, 60 or 90 days to record notice of its mechanic's lien.

It is quite easy for a contractor to record the mechanic's lien claim. It simply must prepare the single-page document and present it to the county Recorder along with any recording fees. There is no judge or jury to determine whether the mechanic's lien claim is valid at the time it is recorded. So, as soon as the lien is recorded and without any testing of its validity, a contractor can put a cloud on the property's title that can make mortgage lenders and potential property buyers shy away from the property.
Occasionally, and unfortunately, an unscrupulous contractor may abuse this process. Because the county Recorder will not question the merits of the claim, a contractor could record a mechanic's lien against the property even if the owner correctly believes no money is due and owing.
After recording the mechanic's lien, a contractor in California has exactly 90 days to file a complaint (lawsuit) in court to seek a judgment allowing the sheriff to hold a foreclosure sale on the property and use the proceeds to pay the amount of the mechanic's lien claim. If the contractor does not file the foreclosure complaint within the 90 days, the mechanic's lien becomes unenforceable or "stale." But, even a stale mechanic's lien still will appear on the property's title report until officially expunged and still can cause concerns to the potential buyers and mortgage lenders.
There is a procedure available to property owners that will allow them to remove the stale mechanic's lien from property records. Pursuant to Civil Code §3154, the property owner may file a verified petition seeking a court order acknowledging that that the stale mechanic's lien is unenforceable. The petition must state the following: (1) the date that the lien was recorded; (2) a description of the property; and (3) allegations that no action to foreclose the lien has been taken, no extension of credit has been recorded, the lien claimant is unwilling to execute a release and the owner has not filed for bankruptcy.

The lien claimant must receive service of the petition at least 10 days before the date set for hearing on the petition. Finally, the property owner will be required to prove that service of the petition and the order fixing the date for hearing both were made in compliance with the statute.

When property owners prevail on their petitions, they can recover some or all of their attorney fees from the mechanic's lien claimant.

Once the court order is obtained, the property owner can record notice of the order with the county Recorder, clearing the title. Then any prospective buyer or lender who sees the lien claim in a title report also will see the court order stating that it is invalid.

Thursday, December 17, 2009

Are lenders forcing Americans into Bankruptcy?

Most people are heavily invested in their homes. Investment is of various kinds and types- financial (down payment, monthly payments, monthly upkeep, payment of taxes, etc.), emotional and time. Most people primarily have emotional ties. When they have financial problem, they want to work out a solution.

Loan modification, bankruptcy, debt consolidation, loan workout, etc. are various kinds of solution. Loan modification is one solution which has been most hyped. Government bailout has made it more dramatic. However, I have come across various situations where lenders have made people wait borrowers for loan modification for a long time and later denied it. Or, for instance, lenders are not willing to consider loan modification for 2nd homes.

Lenders can postpone foreclosure. Sometimes they don't. One of the methods to stop foreclosure is to file bankruptcy and get automatic stay protection. Other way to keep the house is to file Bankruptcy-Chapter 13. Chapter 13 is a reorganization plan where the law allows you, upon meeting the threshold requirements, to prepare a payment plan and keep the house. Under the plan, borrower/debtor makes the monthly payment as well as payment on delinquent amount to the secured lender. This plan needs to be approved by the U. S. trustee, no creditor should object and the Bankruptcy Judge has to approve it.

Lot of people, upon denial by the lender seek the protection of Bankruptcy laws. I wonder why lenders can not work something out in situation where the borrower does qualify for Bankruptcy and Chapter 13.

Internal Revenue Service and legal system find someone qualified, based on income and expenses, to file Chapter 13. However, the lender does not. I feel it is a big flaw in the system. Private lenders have too much power, too much discretion and too much of lack of compassion. It sucks!!

The problem is also complicated by the fact that lot of homes have lost their value. Therefore, even if the borrower makes sufficient income, lending guidelines do not allow refinance.

I wish there were universal guidelines (similar to lending guidelines to which licensed brokers had access to) with qualification criteria and people were not made to sweat about decision on loan modification, knew whether they will qualify or not right away and make adjustment to their finances privately and move on with new revised persona and private plan instead of having to file Bankruptcy and ruining their credit.

What are your thoughts!!

Saturday, December 12, 2009

H1b employers-If Immigration comes knocking, what to do?

Immigration Service has been conducting fraud investigations and raiding H1b employers. One of the things, an H1b employer must do and have is Public access files.

H1b Employers must maintain public access files for each employee. Such files must be created within one working day after the day the LCA is filed with the DOL. The file must be maintained at the employer’s principal place of business or the place of employment.

 The public access file must contain:

·     A copy of the certified labor condition application;
·     Documentation which provides the wage rate to be paid the H-1B nonimmigrant;
·     A full, clear explanation of the system that the employer used to set the "actual wage" the employer has paid or will pay workers in the occupation for which the H-1B nonimmigrant is sought, including any periodic increases which the system may provide--e.g., memorandum summarizing the system or a copy of the employer's pay system or scale;
·     A copy of the documentation the employer used to establish the "prevailing wage" for the occupation for which the H-1B nonimmigrant is sought (a general description of the source and methodology is all that is required to be made available for public examination; the underlying individual wage data relied upon to determine the prevailing wage is not a public record, although it shall be made available to the Department in an enforcement action);
·     A copy of the document(s) with which the employer has satisfied the union/employee notification requirements of 20 CFR §655.734;
·     A summary of the benefits offered to U.S. workers in the same occupational classifications as H-1B nonimmigrants, a statement as to how any differentiation in benefits is made where not all employees are offered or receive the same benefits (such summary need not include proprietary information such as the costs of the benefits to the employer, or the details of stock options or incentive distributions), and/or, where applicable, a statement that some/all H-1B nonimmigrants are receiving "home country" benefits;
·     A summary of the benefits offered to U.S. workers in the same occupational classifications as H-1B nonimmigrants, a statement as to how any differentiation in benefits is made where not all employees are offered or receive the same benefits (such summary need not include proprietary information such as the costs of the benefits to the employer, or the details of stock options or incentive distributions), and/or, where applicable, a statement that some/all H-1B nonimmigrants are receiving "home country" benefits;
·     Where the employer utilizes the definition of "single employer" in the IRC, a list of any entities included as part of the single employer in making the determination as to its H-1B-dependency status;
·     Where the employer is H-1B-dependent and/or a willful violator, and indicates on the LCA(s) that only "exempt" H-1B nonimmigrants will be employed, a list of such "exempt" H-1B nonimmigrants;
·     Where the employer is H-1B-dependent or a willful violator, a summary of the recruitment methods used and the time frames of recruitment of U.S. workers (or copies of pertinent documents showing this information).

Friday, December 11, 2009

Will-definition and requirements

Will: American Heritage Dictionary provides the following meaning (among others):

  1. A legal declaration of how a person wishes his or her possessions to be disposed of after death.
  2. A legally executed document containing this declaration.
I need not say any more. It is pretty clear, at least in my mind.

A will can be handwritten or typewritten. A handwritten will is known as Holographic will and can be sufficient without any other indicia's. However, the following information must be present:

  1. Identify the testator (person who is writing the Will) fully. We usually also provide address.
  2. Revoke any previous Will or Codicil. A codicil is an attachment to a Will.
  3. Putting a date on the Will or Codicil is important. Last one in time controls.
  4. The testator must be of sound mind. Hence the requirement of two witnesses. Witnesses can prove whether the testator was of sound mind or not or knew what he or she was doing or not. California requires two witnesses.
  5. Holographic will does not need to be witnessed. However, in order to avoid any possibility of any challenges around validity (sound mind, intention, etc.), it is a good idea to do it formally and in presence of witnesses.

  6. Proper age is important. Any adult over 18 can write a will.

A will can be changed or revoked any time. More later…………….!!

Friday, November 27, 2009

Basic Steps to Obtaining Green Card-Legally!

1. Get your credentials evaluated. First and foremost step is to get your credentials evaluated. This is the foundational question that needs to be answered- what is your qualification for a certain immigration category and whether you meet the US equivalency or other are qualified for it or not. For example if you are going to get H1b work visa status, your education must be equivalent to US college degree (B.S. degree). If you did not get equivalency to B.S. degree, then instead of filing for work visa perhaps you will need to enroll as student to complete the number of units required to get B. S. degree. And a student visa will be required.

Similarly, if you are filing for L-1 category, your should have, at minimum, worked for the company overseas for at least one year out of last years and a certain business relationship must exist between the international company and US business-among other things. If you do not meet the criteria for L1, however, if you are a national of one the countries which has treaty with the U. S., you might qualify for E-1 visa.

If you don’t meet the criteria, no matter what, you won’t qualify and will hope against hope. You will end up wasting your time and perhaps life. I have seen too many individuals being led to believe that they qualify and they end up filing wrong petitions and paperwork and eventually suffering by getting out of status.

2. Consult an Immigration lawyer. An Immigration lawyer is a specialist in this arena just like any other lawyer or professional. Most of the problems work visa holders is that they rely on co-workers, inexperienced employers or generic information on internet. “My cousin got the visa. Why can’t I get it” or “Let us make some resume up”-kind of mentality can lead you in trouble so an X-ray and the right advise by an Immigration Lawyer would go a long way.

Be prepared to meet the attorney in person. There is lot to be said about meeting someone in person, looking them in the eye and having undivided attention. Be prepared to pay a consultation fees if you want some respect and real attention. It shows your commitment to the process and respect for the professional’s time and experience. You will get the same respect and attention back. Do you like when you get paid, so do the attorneys!

3. Find a qualified employer. Once you know which visa category you will qualify in, then act accordingly and find an employer who is willing to sponsor you and meets the criteria. An employer has to be a qualified employer as well. For example, these days IT consulting companies are not doing well because of downturn in economy and are under high scrutiny. Immigration Agency is investigating about 25,000 of company which typically hire H1b workers to investigate fraud. So, if you are an IT professional, for example, seek an employer who has been in business for a little bit, has good business model (product or service), can provide financial standing and meets the other true business indices. If you are doing MS in Education, you might qualify to work for school or other such non-profit agency.

4. Get the visa and obey the law and rules. Once the visa petition is filed and approved, understand the rules and obey them. A non immigrant visa worker is typically eager to please the employer. The employer sometimes can be eager to save money and cost or make the employer work overtime without paying overtime.

There are several cultural issues which can make an employee feel intimidated. Know your rights and stand your rights. This is United States of America, not a third world country. Stand your ground.

If you or the employer break the law, both will land in trouble. For example, if you are an H1b visa worker and do not get paid regularly or are on “bench”, you are breaking the law and consequences can be serious. Similarly, an employee not providing sufficient breaks or paying employee overtime will be found violating the labor laws. Fines are hefty and can range from denial of green card petition, having to wait out of US for green card for number of years to monetary fines to jail time. Is it worth it?

5. Plan ahead for the next step. Know your goal. If you goal is to work temporarily and return to your country after sometime, that is fine. However, if your goal is to get green card, then you need to plan ahead. Know the processing time for visa petition type you will qualify under. Most people keep hopping jobs until last year of work visa. During the last year or so, they try to find an employer who can sponsor for green card and end up missing filing deadlines which would enable to them to extend the visa. It is extremely difficult to return to your home country after you have been here for a while.

A change in economy overall or financial and business conditions of employer can also result in a predicament. For example, if someone starts ahead of time in green card application through the employer, he or she can obtain 3 year visa extension on H1b while waiting for green card final step as contrasted with someone else who will have to get yearly extensions.

None of the factors I have stated are rocket -cience. I am stating the obvious. However, most people don’t want to know the simple truth. People get desperate and they go down this unending cycle of false hope, lies on immigration paperwork risking their peace and freedom. Please be realistic and follow the law.

Thursday, November 26, 2009

Can lender come after the Borrower for deficiency in a foreclosure?

Most people think that their liability is limited by the security interest and if property is foreclosed they are not liable. This articles intends to clarify the (mis)understanding.
The answer is- depends. It is not a lawyer like answer. The answer really depends on whether the loan the lender had given on the property being foreclosed was a purchase money loan or a refinance loan.

If the loan the lender had given against the property was a purchase money loan, the anti-deficiency laws prevent the lender from being able to file a lawsuit for the deficiency.

However, if the loan the lender had given against the property was a refinance loan, the anti-deficiency laws allow the lender to file a lawsuit for the deficiency.

The logic is that in a refinanced loan, the borrower was able to find better loan terms or perhaps took the equity out and used it to his or her benefit. So, there is a presumption of added benefit thus allowing lenders to recover the deficiency amount.

The deficiency amount is the difference between the loan amount and amount of money recovered by the lender after foreclosure.

Purchase money loan is the original loan obtained by the borrower at the time of purchase of the property.

Refinance loan is the loan obtained by refinancing the loan to get better loan terms (interest rate, amortization period, etc.) or to take cash out for personal use or to pay off other debts.

Lot of people bought the property to get their foot in the door and got a low interest rate, mostly negative amortization loan. Later, they refinanced the loan when the property went up in value. It was easier. Lenders did not care because it is profitable business. Lenders, loan brokers, appraisers, escrow companies-everybody made money. Now, these people, if facing foreclosure, can be liable for the deficiency amount.

Lot of people know about One Action Rule and think that lender can not bring claim for deficiency. One Action rule is provision of law under California Code of Civil Procedure. Basically, it forces a lender to choose between foreclosure and judicial action which combines foreclosure and deficiency judgment. So, as the name suggest, lender has to decide which (one) form the lender will chose.

The primary method of foreclosure in California involves what is known as non-judicial foreclosure. This type of foreclosure does not involve court action. If a foreclosure is completed by non-judicial means, a second action to recover a deficiency judgment is not permitted. However, rules stated above apply under the case law that if the loan is refinance loan, the deficiency action can be brought. Most lenders will negotiate the amount though and settle for less. This can be an opportunity to negotiate the debt down.

Sunday, November 22, 2009

Plan your Affairs-simple ways to avoid Legal fees, taxes and Legal costs

Legal fees are incurred when attorney gets involved or a matter has to be handled in court. Typical example is Will-contest or probate fees (attorneys fees and court fees) in Probate Court.
Taxes are incurred when someone has poor estate tax planning or no estate tax planning. Estate taxes are due nine (9) months after the death and have to paid in cash. No installments. The Estate Tax is a tax on your right to transfer property at your death. Assets have to be sold at the value they can fetch in “fire-sale”.
Legal costs such as probate fees etc. again are incurred when there is poor or no estate planning.
Here are some of the simple ways to avoid legal fees, costs and taxes (estate taxes or gift taxes).
1.       Do not die without a will. At least have a will. No will (for estate worth $100,000 or more) = Probate-for sure. Even a will does not avoid probate but it can give some direction to probate court and help move things along much faster. Something is better than nothing.
2.       Take benefit of tax laws and codes which allow lot of tax savings and cost savings by forming revocable living trust. Revocable Living Trust allows one to take benefit of federal unified tax credit system and save money on legal fees and costs. It also ensures privacy.
3.       Write out your health care and financial affairs power of attorneys which will help deal with your affairs in the event of a disability rendering you incapable of handling your own affairs. Designate someone who is capable of handling the affairs properly. Base your designation and appointment of your agent on competency and not emotion.
4.       Title your accounts properly. If you have a checking account with your son or daughter and there is not much money in the same account, designate it as payable upon death to make the transfer easier.
5.       Give gifts. Of course, everybody cannot or does not need to give gifts; however, gift tax planning is definitely required for individuals with large estates to take benefit of unified tax credit system. Proper gifting on annual basis can go a long way.
6.       In the event of a business, make sure to properly insure it and have provisions of its continuity. This is critical in the case of partnerships, for example, to express your desire about how the business will continue in the event of one partner’s death. Buy-sell agreements or 2nd to die policies are great way to make up for the loss and ensure smooth continuity of the business.
7.       Benefit from Asset Protection strategies to avoid lawsuits or potential liability.

What is Probate-the basics.

Probate is the Court-administered process which facilitates the transfer of assets of deceased (someone who died) to his or her beneficiaries/next of kin. In California, if the assets owned by deceased are $100,000 or above. The assets subject to probate are those which are not subject to right of survivorship or transferable upon death. A typical example of assets transferable under right of survivorship is real estate owned as community property or joint tenants. An example of property transferable upon death is Payable on Death bank accounts.

So, if someone dies with a property owned as joint tenant and a POD bank account, there will be no probate. This avoids probate but there are other estate tax and income tax related consequences which render these methods expensive later on (higher tax consequences).

Purpose of the probate is for the court to take an inventory of all the assets owned by the deceased, make sure that all creditors are paid, handle any and all challenges to will (if any), and then transfer the balance to the persons named in the Will or if there is no will, to transfer the property to lawful heirs under Probate Code.

So, in reality, if someone has a Will and has assets over $100,000 in assets, the estate will go through probate.

Similarly, if someone dies without a Will, and has assets over $100,000 in assets, the estate will go through probate.

Thursday, November 19, 2009

How to divide interest in new business!

I was consulted by two friends who wished to start a business. They wished to get legal advice on what is the best form of business (benefits of corporation versus sole proprietorship, etc.), lease issues, personal liability of individuals to the lenders in case of default on business loan, hiring and firing of employees, etc. I was impressed with these people. One client had all the questions on his iPhone- putting technology to use. Lot of thought seems to go in the process which is a great sign of business planning.

One of the questions which was most interesting was-how to divide the interest. Both partners were putting in equal amount of money but one partner was going to work in the business and take care of the technical side as well as day-to-day management related issues. The working partner wanted a higher interest as well as a monthly compensation once the business reached a certain level of revenue. The investing partner wanted to know if such division of business equity was fair and reasonable. Specific question was what is the norm?

There is no particular norm in the industry for division of equity or share. I feel it is all negotiable. It just depends on what value is placed on money invested, work done, product created or service rendered and result obtained.

However, it is a great idea to talk about these things before hand to avoid future problems. Someone who is going to work in the business will naturally take most of the credit as person is using his technical and management skills based on previous experience. The investing partner is bringing in the money.

It is interesting to note that even though the money is important to run any business, the things change drastically when someone starts to value his own skills more than the money. If money is not there, the business won't start, however, if the business person is not there to manage functions skillfully then the business will not continue. It is classic "chicken or the egg first?" kind of situation.

What I felt was that the partners had the following choices:

1.      Acknowledge that money is important. And that personal credit is being used to qualify for business loan. Bank is requiring personal guarantee. Question becomes how is providing such guarantee!
2.      The working partner is contributing his business, technical and management skills.
3.      Either divide equally and pay the working partner a certain reasonable monthly amount as Manager. Or give the working partner a little bit higher interest (share) based on his skill if the business can not afford to pay the monthly amount.
4.    Loan money the friend/wanna-be-working partner at a market interest rate and be satisfied with the return.

5.      And lastly, walk away from the venture. My logic was that working partner might adjust the interest currently based on business or financial need. However, if working partner already views his experience and skill as more valuable and worth higher interest plus monthly salary, then at later stage, once the business starts to flourish, it might create more problems and might lead to a rift and breakage in relationship and smooth functioning of business.

Good thing is that at least these people are talking about it and discussing it before hand. I am sure based on their relationship, they will be able to reach a happy medium and do well in the business. I certainly wish them well.

Corporate Governance

Modern corporations are moving towards a progressive era of shareholder franchise which was a myth till yester years. The biggest questions that come to the fore when discussing corporations’ role is that of corporate governance: how companies are run internally and what rules they will play by in the external world. In a narrow sense, good corporate governance means shareholders realize value and boards of directors have an easier time fulfilling their fiduciary duties. More broadly, corporate governance is about the principles that underlie democracy: transparency, checks and balances, and accountability. Good corporate governance means that businesses recognize the duties that correspond to the privileges that society has granted them: favorable tax treatment, limited liability, and so forth.

I, as an attorney, contribute by being part of a corporation’s professional legal team by advising on what measures you need to take to comply with the modern day corporate governance practices; to legally protect the corporation, directors and officers from shareholder derivative litigation and take care of all legal compliances which the stock exchanges have made mandatory compliance for all public companies listed and trading. Smooth flow of capital, investor faith and reliance on the corporate machinery also directly depends upon good corporate governance structure where the present course of action would be governance restructuring to provide transparency, checks and balances in the functioning of any modern day corporation and create a competitive, fair and ethical corporate climate.

Here forth is set a list of best governance practices which should be incorporated in the articles of incorporation and to be used as a governance constitution which cannot be modified without shareholders consent and leverage given to the Board of Directors for business oversight:

• Checks and Balances - Transparencies in conduct of corporate affairs.
• Active, Informed and Independent Board.
• Role and duties of Board of Directors in compliance with governance standards.
• Nomination of Directorial candidates and Election Process –CEO selection and succession planning as well as electronic “town hall” system to facilitate proposed shareholder resolutions.
• Specific and Active Board Committees – Audit Comm., Governance Comm., Compensation Comm., Risk Management Comm. with independent directors heading them.
• Term limits and Auditor rotation.
• Compensation limits.
• Equity Compensation Programs.
• Legal Compliance - Enhanced Legal Department and Ethics Program.
• Performance Monitoring.
• Non Executive Chairman of the Board of Directors who will be coordinating Board’s work, chairing meetings, organizing CEO and Board Performance audits.

Monday, November 16, 2009

What is Estate Planning? and more!!

"I want to control my property while I am alive and well, care for myself and my loved ones if I become disabled, and be able to give what I have to whom I want, the way I want, and when I want, and, if I can, I want to save every last tax dollar, attorney fees, and court cost possible."

(Courtesy, Generations by Esperti and Peterson). Definition adopted by NNEPA.

Point is make decisions and plans while you can-when you are alive and well.

My wife is leaving for India for two weeks. I will here with our two kids. She started to tell me what to do. I asked her to write everything down. So, now I have notes from kids' doctors to how to make a dish (so-called recipe) to the kids' menu for breakfast to dinner. It helps to have written instructions!

How would the world know what you want or should I say wanted if something happens to you!!

Friday, November 13, 2009

Starting a Business-Issues to Consider

So, you have decided to start your own Business. My first advice would be to read The E-Myth Revisited by Michael Gerber.
Secondly, how you run your business is your business. I, as an attorney, can contribute by being part of your professional team by advising on what measures you need to take to comply with the law and also to legally protect yourself.
So, if you are confused about which business licensing department to visit first or which corporate form to select or what paperwork you need to open your bank accounts, don't worry. Most new business owners are. You just need to make sure that you either have the time to do the research and no money or that you want to do it right and hire the right professional to help you with the process.
Typical issues are:
Licensing. City, County, State licenses and registrations. Make sure to comply with the City, County or State requirements. For example, if you are going to be conducting the business in your name alone and working from home, you still need to register the business with the city and obtain license. However, if you plan to form a company, you have to also register the company with the State and file incorporation documents in addition to registering with the City. See the difference and importance!! Of course, you knew that.
Sole proprietorship vs. Corporation. So, if you have looked into what form of business you are going to conduct and if it is going to be individual name or proprietorship, then you do not have much to worry about. However, if it is going to be a corporation, you still have to decide whether it is going to be LLC or P. C. or C Corporation or S Corporation.
And different options are available to people depending upon what is their background, who else is involved and what their objectives are. For example, a doctor can have Professional Corporation (P. C.) but an Engineer cannot. Whether the corporation is going to be a C-corporation or S-corporation also needs to be decided based on the objectives of the corporation. A good CPA can help in the decision making process.
Professional Advisory Team.  Who will help you on legal matters? Legal matters can vary from simple incorporation to complex employment or corporate Governence. Who will help you with tax planning and strategy? Who will help you with Marketing? Insurance and Financial planning is a big part of running a business. So, make sure to identify your lawyer, CPA, Insurance Agent, etc. before you need them.
Here is a short list of documents which are required as well.
Governing Documents
Operating Agreements
  1. Shareholder Agreements
  2. Bylaws
  3. Buy-Sell Agreements
  4. Partnership Agreements
Employee Related:  
  1. Employee Manuals
  2. Independent Contractor Agreements
  3. Employee Agreements
  4. Confidentiality Agreements
  5. Non-Disclosure Agreements
  6. Noncompete Agreements
It's much easier and far less expensive to do things right at the start than to try to fix a mistake down the road. With all the laws and regulations out there, it's easy to make a mistake.  I have seen too many people get excited about working together and not paying attention to legal aspects and then later paying for the mistakes.
                                         More later….stay tuned!!