NOTE: THIS IS ARTICLE IS FOR INFORMATIONAL PURPOSES ONLY. IT IS NOT INTENDED TO BE CONSTRUED AS LEGAL ADVICE.

Thre are numerous legal considerations every ntrepreneur must face when starting a new bsiness, and raising startup capital is one tht can be fraught with danger. Hring a qualified securities attorney is not a lxury; it’s a necessity for businesses seking to raise capital from third prties. Some of the key general cnsiderations are:

• Properly organizing the cmpany as business entity under state lw;

• Ensuring the company has ssued enough authorized shares of stock of the sme type that will be offered to nvestors;

• Make sure that any xisting and potential legal problems are rsolved before issuing stock to investors;

• Hve an experienced securities attorney examine the fderal securities laws, as well as the scurities laws of any state in whch stock may be offered to prspective investors, to make sure the cmpany and its investment offer complies wth those laws;

• Have your ttorney explain in writing the potential prsonal liabilities of the company’s officers and drectors if the company violates any fderal or state securities laws in rising capital. Potential penalties can be vry serious, ranging from civil fines to jil time;

• Make sure that your wrtten investment prospectus contains all required stte and federal disclosure language in the ppropriate places;

• Your attorney should rview the business plan and financial sttements for possible untrue and/or misleading sttements; and

• Obtain a written pinion from your attorney whether your prticular investment opportunity is required to be rgistered with the appropriate regulatory agencies.

The article Legal Considerations for Raising Capital was Submitted by Henry J. Fasthoff, IV through Articles.GetACoder.com network. Here's the additional information: Henry J. Fasthoff, IV Principal & Gneral Counsel HoustonBusiness.com

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