I am opening a concession stand business that will be parked in a fixed location in nashville.I am looking to expand through out all the tennessee cities that will allow me to park and do business out of concessions. I recently met a guy that has money to purchase concession stands also but he will like me to use my business name and my recepeit and open in ohio with hopes of also expanding through out all ohio also. I dont want to give my business away and don't want to work for anyone.He would be incharge of the ohio region and I of my tennesse region.Is a LLC the best way to go for this and I don't want him to be an owner but just like a shareholder because it's still going to be my business technically and I told him I would get a percentage of his ohio locations and he agreed.
What steps should I take ,and what legal forms should I fill out in order to correctly proceed with this?
I would be inclined to recommend an S corporation unless he agrees that in an LLC you are the sole manager. Absent agreement for a manager managed LLC, everyone has a right to vote on everything. You could create an Ohio subsidiary that is autonomous for the most part in which you hold a majority interest.
If he is shareholder (which occurs only in a corporation--LLC owners are members) then he owns part of the company, but you can maintain control. You could arrange even for him to have non voting stock.
If you are going to enjoy profits from Ohio my first inclination would be to set up two companies, though I do not, of course, have all the details.
In short, there are several ways to accomplish your goal depending upon what the other guy will accept and what your long term goals are.
You need to retain a local business attorney. The choice of entity is not normally driven by the type of business (an exception to that rule relates to real property holding ventures). The choice of entity depends on your current situation, the situation of possible other owners and investors, and other considerations. It is complex and something that should only be done with advice of an accountant or an experienced business attorney with expertise in entity selection.
You said he may purchase the stands. So, depending on the facts, this arrangement could be structured as an investment, a license, or may even be considered a franchise. These all involve separate aspects of law and very different forms of agreements. Moreover, especially for investments and franchises, they are so complex that the idea of doing this without legal advice is a recipe for disaster.
Find a local business attorney through Avvo or you local bar association.
This answer is for informational purposes only and is not legal advice regarding your question and does not establish an attorney-client relationship.
Attorney Murrillo has presented a number of diifferent scenerios, all of which could work. You and your propsective "partner" need to consult with busines attorney(s) that provide you with advice as to Ohio and Tennesse law.
You can structure an LLC so that you have a majority controlling interest. You need to have a solid buisness plan before you move forward in case your business takes off. I would suggest that the first thing you do is hire a professional to develop your business plan before you agree to anything with anyone, and before you meet with an attorney.
Phillip M.Smith Jr.
Los Angeles Tax and Business Attorney
THESE COMMENTS ARE NOT LEGAL ADVICE. They are provided for informational purposes only. Actual legal advice can only be provided after consultation by an attorney licensed in your jurisdiction. The answer to question does not create an attorney-client relationship or otherwise require further consultation. Mr. Smith is licensed to practice law throughout the state of California with offices in Los Angeles County. He is authorized to handle IRS matters throughout the United States, and is also licensed to practice before the United States Tax Court. His phone number is 323-292-4116 or his email address is firstname.lastname@example.org.