As an Incorporation Attorney in Orange County California,
I like to provide our clients with as many free resources as possible. Linked below is the ACA Quick Reference Guide to the Health Care Reform issued by Word & Brown. The booklet is specially tailored to small group employers.
Topics covered include:
Budget Considerations
Health Plan Administration
Documents for Employees
Plan Design Changes
General Compliance
If you have questions in these areas, this can be a useful resource to make sure your business is in compliance with the most recent health care reforms and requirements and it is a good source for general information. However, the booklet should not take the place of legal advice in the instance of a serious issue.
Click Here to View the Booklet in Full
Additionally, I have a great resource in the health insurance business and can refer you to for more information. Just give me a call for the referral.
If you need to talk to us about any potential legal problems, remember that we are just a phone call away at the Law offices of Gale and Vallance (714) 634-4838
Business Attorneys Orange County California Bulk Sales Law Part Three – AProcessed Video Transcription
Buying a Business and the Bulk Sales Law – What Does the Buyer Have to Do?
The buyer has to do four things:
Buying a Business – What You Need to Consider About the Bulk Sales Law
The first thing they’ve got to do is they’ve got to go down and record at the County Recorder’s Office the fact that notice is being given to the creditors and typically the form is called “The Notice of Bulk Sale.” There are specific things that are required to be placed into the notice and if you want to know what those are, read the link blog below that’s attached to it. I set out all the specifics that needed to be contained in a Bulk Sale Notice here in the state of California.So first the notice gets recorded.
Secondly, the notice needs to be published and it must be published in a newspaper of general circulation and there are a lot of local newspapers that are set up specifically to be in the business of doing this kind of publication. They know exactly what to do once you give them the notice and typically they charge a very small amount of money to do the publication.
Third, what you’ve got to do then is to give notice to the local tax collector by sending them a certified mail return receipt.
The fourth and most important thing that you must do is you must wait.
In the state of California, a buyer must wait at least 12 business days to give the creditors the opportunity to get the notice and to file their proper claims against the assets that are going to be sold. The buyer wants to do all of this stuff before you give money to the seller. The reason why is that once the money has gone over to the seller, more often than not it’s difficult, if not possible, to get the money back. And now the buyer is in the situation of dealing with these creditors and having to pay the seller’s debts rather than saying, “Hey, go chase after the seller. I gave him the money.”
So if you have a key takeaway here what you want to do is make certain: (1) does the Bulk Sales Law apply to me; (2) if it does apply to you make certain that you comply; and (3) hang on to your money at least 12 business days until you know that the time period for having a creditor makes a claim has gone.
Gale and Vallance Business Attorneys Orange County
I hope that was helpful. It’s a little bit complicated. The bulk sales law is one of those many areas in business where I think it’s well-advised to have a small business person hire business attorneys Orange County California that know exactly what they’re doing. Let the business attorneys become their trusted adviser to their business and you will be well-rewarded I think for the small amount of money that you’re going to pay to qualified business attorneys to help you deal with this kind of a problem and many others that come up in the life of a business owner.
So what is the Bulk Sales Law? Basically, Bulk Sales Law says that if you are a buyer and you’re going to buy more than 50 percent of someone’s inventory or fixtures and it’s not what they do or that is not what the seller does in the ordinary course of their business and if the value of the inventory and fixtures you’re going to purchase are more than $10,000 and less than $5 million.
If you do not want to have any problem with the seller’s creditors in the future, then there is an affirmative obligation placed upon you that you’ve got to go out and you’ve got to attempt to notify those creditors to say, “I’m buying all of this inventory. I’m buying these fixtures and I want to let you know that I’m doing it so that if you have a claim against the seller you can let me know before I go ahead and give my money over to the seller.
Once the buyer has complied with the bulk sales law, the buyer has protection from the law so long as he followed all of the procedures, so long as he did the proper notification. Then if a creditor has a complaint, his complaint is not with the buyer but it’s with the seller. So what does the buyer have to do?
What the Buyer Needs to Do
First, make sure that he falls within the parameters of the law as we discussed earlier: more than $10,000 and less than $5 million, buying at least 50 percent of the inventory and fixtures, and the seller is not in the business of selling that quantity of stuff.
Gale and Vallance Business Attorneys Orange County California
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Good morning. My name is Andrew Gale, business lawyer California at Gale and Vallance, and I was working on a project last week with a client who is interested in buying the assets of another business that he’d come across. He thought it was a fantastic deal for him. He was going to be able to buy the entire inventory and some of the fixtures of this business and get it at a great price.
Business Lawyer California
So what he wanted to know was there something that he should be aware of or something that he should do to protect himself because he had a little bit of concern that it seemed like it might be too good to be true kind of a deal or he might be worried a little bit about the creditors of the seller’s business perhaps chasing after him for taking all of the inventory. So the answer is yes, there is something that he could do. In the state of California, there is a law called the California Bulk Sales Law.
Bulk Sales Law – Does it Apply to You?
Basically what it does is protect creditors in exactly that situation. If the seller has some inventory and it’s not in the ordinary course of their business and they’re going to sell more than 50 percent of the inventory and they will frequently look at their fair market value what happens is the Bulk Sales Law will come into place. One other thing is that the value of the inventory is more than $10,000 and less than $5 million which was the situation where my client was in. Since the law applied to him, he needed to know what he needed to do and what the ramifications were if he didn’t comply with the bulk sales law.
Good morning! This is Atty. Andy Gale your small business attorney Orange County. I just wanted to share with you an issue that’s come up with a number of our clients here recently and I want to make sure that you don’t get into the same problem that some of these other folks did.
The issue that’s coming up is that our corporate clients are receiving a number of solicitations that look something like this form, kind of an official state form. I’ll try to put a picture of it up in this video so that you can get a better look at it. This one’s entitled ‘2013 Annual Minutes Records Form’ and here’s another, kind of a different but same sort of form called ‘Notice of Corporate Compliance Requirements.’
Scam Solicitations Corporate Records
The problem here is that these solicitations, though they look like the actual solicitation or form that you would need to satisfy certain state requirements here in California, have absolutely nothing to do with the state. You can see how similar it is in format to the actual one that you do need to complete from the state called ‘The Statement of Information.’
Scam Solicitations with Bar Codes
These forms come in what appear to be official government envelopes, they have bar codes on them, and they have the boxes that would be filled out that look identical to the ones that are required by the state. They start out giving you the normal state codes that state why you need to do some of this stuff.
For example, this one says California Corporation’s Code section 1500 corporate records each corporation shall keep adequate and correct books of corporate records and account and keep corporate minutes. The form seems to suggest to you that if you complete this form you’ll have met those requirements.
In reality, that’s just not the case. They give you the code and make you aware of the fact that there are state laws. They require information from you that you think is going to a state agency but in fact, it’s going to some private organization. Who knows what they’re going to do with the information.
They may be selling it to your competitors or to other people who are going to solicit your services. But you think, well, for a small amount of money I’ll fill out the form and I think I’m in compliance. What’s funny is that if you fill out this particular form, this one will cost you $125, that’s the big white one and that’s from an outfit called Corporate Records Service. If you fill out this particular form, this one will cost you $149. Finally, at the back here, they say, ‘Here’s our disclaimer.
Corporate Minutes Services is a private, non-government business providing corporate services to corporations. CMS cannot and will not provide any legal advice.
Gale and Vallance Small Business Attorney Orange County
Earlier this week I had a call from a friend of mine who is an accountant and he had a client of his in his office and he wanted me to come over and talk to her about a business that she’d bought. We’ll call her buyer. The buyer had been contacted by a friend (seller) who wanted to sell a business and the business went up for sale for $30,000 and there were a couple of months left on the rent.
The friend prepared for the buyer a short one-page financial statement indicating how much the business made a month and what the basic expenses were, and the bottom line of what the profit was on a monthly basis. Armed with that and with a bill of sale, the buyer bought the business.
When she got into the business, she realized that the representations made by the seller weren’t true and the business was losing money and she wanted to know what she could do about it. One additional factor was a couple of months into this purchase the original lease that the seller had ended and the buyer went out and renegotiated a new three-year lease at $2,500 a month with the landlord.
So now the buyer was very upset because the business was losing money. She couldn’t pay her mortgage or rent. She was having a hard time paying employees and was wondering what she could do about the business, and what she could do about the landlord. The bad news for her was probably very little. She got stuck into a bad deal because she’d made three simple but very critical mistakes in getting the business started.
So let me just walk through these with you quickly and hope you keep them in mind if you ever get into a situation of buying a business.
#1 Mistake: No Proper Advice on the Financials
The first mistake that she made was that she did not properly review the financial statements, and/or go out and seek the advice of someone who understood exactly what would be required to put an accurate financial statement together.
Financial Statement Review
I asked her whether or not she had actually met with the CPA who called me over prior to the purchase of the business, and she said no. I asked her whether or not she consulted with a business lawyer before she signed the bill of sale, she also said no. I said, “Well, why did you wait ’til now to talk to some advisers?” And her answer was, “I just didn’t want to spend the money.
It didn’t seem that complicated. I did some research on the internet and I thought I could just save myself some money.” And it’s true; she did save herself some money in getting into this transaction. The problem of course is that it’s going to cost her a lot more money to get out of the transaction.
So first she didn’t have any proper advice on looking at the financials. Had she just met with an accountant, the accountant would have been able to ask for supporting documentation which would have easily told her that this business was not generating what the seller alleged it was and she wouldn’t have got into the deal.
#2 Mistake: No Business Lawyer to Assist in Reviewing the Agreement
Getting Assistance from a Business Lawyer
The second critical mistake that she made was that she didn’t have a business lawyer assist her in reviewing and drafting a purchase agreement. In a typical purchase agreement there would be terms where if the seller had made false representations, the buyer would have had recourse in terms of going back and making a claim against the seller and trying to get out of the transaction and getting out of the deal.
But rather than seeking the advice of an Orange County business lawyer beforehand, now she was seeking the business legal services and advice of a business lawyer at the end of the deal and it was probably going to cost probably more money than she’d even invested in the business to get into litigation over the matter. So that wasn’t very good.
#3 Mistake: No Advice from Business Lawyer for the Lease Arrangement
The third mistake that she made was that she went out and negotiated the lease arrangement with the landlord without again seeking the advice of a business attorney. Had a business attorney been involved in the transaction, it would have been entirely possible to negotiate terms with the landlord especially in this economy whereby she would have a possibility of getting out of the lease if her business had gone so good she would’ve needed to expand her move to another location, or on the downside if the business had not gone anywhere, she might have been able to negotiate a term that would have allowed her to get out of the business, that is, pay a few months of rent and then the landlord would have excused her from the balance of the rent.
But she didn’t know any of these things. So instead of saving $1,200 or so in professional fees and business legal services at the start, now she’s lost $30,000 in the business because it’s likely to go bankrupt plus she’s now going to have a landlord chasing her for three years’ worth of rent at $2,500 a month.
Andrew Gale, Orange County Business Lawyer for Business Legal Services
All of this could have been easily avoided, and so I would strongly urge you that if you’re in the mood to be purchasing a business, please go out, hire a trusted adviser, meet with your Orange County business lawyer. They’re going to be one of the best tools in your business toolbox that you could possibly use. They do cost a little bit of money, but they typically will save you far more money in the long run.
Also, get integrated into your toolbox a good CPA. It’s best for you if the CPA and the business attorney have a relationship. But at a minimum, at least have these two advisers out there working for you. I think you’ll be much happier as a business person and you’ll tend to make much better business decisions. And you’ll do it sooner rather than later which will make you much happier in the long run.
I hope these thoughts were helpful and this experience of this person was helpful to you. If you have any questions, please call us. We’re more than happy to consult with you and give you some guidance on what should be a very happy and profitable experience for you.
Again, my name is Attorney Andy Gale, an Orange County Business Lawyer. Thanks.
Visit Gale and Vallance Orange County Business Attorney for more information about the business legal services we offer. Click on this link https://www.incorporationattorney.com/.
Attorney Andrew R. Gale was recently named by OC Metro Magazine as one of the Top Attorneys in Orange County. He was specifically acknowledged in the Corporations category.
Andrew R. Gale: A 2013 ‘OC Metro’s Top Attorney’
Orange County corporations attorney Andrew R. Gale was recognized because of his unique combination of client satisfaction, dedication to quality, and affordability. Take a look at what past clients have had to say about Andrew R. Gale on AVVO.com, a site dedicated to “helping people make the best decisions for their important legal needs.”
If you need to talk to a business lawyer, why not make it one of the best Orange County has to offer? You can reach Orange County corporations attorney, Andrew R. Gale at the Law offices of Gale and Vallance at (714) 634-4838.
Recently some of my long-term, as well as prospective clients, looked me up online only to become confused by clicking on links for Andrew S. Gale who also happens to be an attorney!
It’s easy to see where the confusion comes from as his profile is for similar business services only his are based in Connecticut.
But I Thought You Were A California Attorney?
This all came to light when one of my recent contacts said, “I thought you were in California?”
To clear up the confusion I thought I would write this quick blog post to clarify that I am Andrew R. Gale (“R” stands for “Richard” BTW), I am based in California in Orange County.
Actually, my full name is Andrew Richard Edward Gale, but the only person that uses that long-form is my mom when I am in trouble, and yes even Attorneys occasionally get in trouble with their mothers!
Andrew S. Gale Seems like a Nice Chap But…
I have no affiliation with Andrew S. Gale, although he certainly seems like a nice chap. The only thing I can say for sure is that he is not as pretty as me!
Bottom line is if you want to work with a local attorney in Connecticut he may be for you, on the other hand, if you need a great attorney in California to help you with business-related legal issues I’m your man!
Call Andrew (Andy) (Richard) (not “S”) Gale +1 (714) 634-4838, get superb legal advice, and learn that even an attorney can have a sense of humor.
Disclaimer
All references to attorneys having a sense of humor are the opinion of the author and should not be considered to be a definitive, qualitative, or in any way a meaningful statement beyond the intent to cause confusion and chuckling…
Summary by Robert Beck, Legal Extern
Legal Curveballs: Liability and Recreational Use Statutes
Liability may occur when you invite people onto your land or open it to recreational use.
Don’t Get Burned During Your Kitchen Renovation
Contractors who go bankrupt actually gain the protection of the bankruptcy court, shielding them from sub-contractor payments and leaving you with the bill.
Your Small Business and Your Death: Planning Ahead
Business owners should utilize estate planning services with the help of a legal professional well in advance of their passing to ensure a smooth transition for their business and loved ones.
Supreme Court Update
While most people hear about the issues of same-sex marriage and DNA swabs by the police, the Supreme Court is also ruling on the subjects of sniffing dog trespasses, overseas textbook selling, and whether or not genes and seeds can be patented.
Highly recommended!
Andy Gale & the associates at Gale and Vallance were awesome in setting up the CA Professional Nursing Corp for ARF Admin Solutions. They were very responsive and knowledgeable from the start. Highly recommended!
George
01/01/2023
Business legal services
Gale & Vallance provided excellent business legal services. The firm was professional, prompt and prepared. The entire process of starting a new corporation was easy and affordable. They have my recommendation.
Raj
07/10/2022
Highly Recommend!!!
I met Andrew Gale through a mutual friend several years go. I was so impressed with their business practice that I made it a point to get to know the attorney to expand my own business. Several years later following their advice i am successful with my business endeavors and do not make any decisions unless i consult with them. Not only do they manage my corporations but also literally help 30 of my clients who use their services. Rare gems in the industry. Highly recommend Gale and Vallance.
X
Incorporation Attorney
1820 W Orangewood Ave Ste 104a, Orange, CA, United States
This firm is excellent, efficient, reliable, with great valuable expertise and very thorough. Their dedication to providing great work and service is apparent in their kind, supportive, consistent great communication. Including providing consistent updates on new laws and regulations. Working with them and having them on my team, I have the confidence and reassurance that all services provided will be of great assistance and help to the continued positive growth and success of my corporation business along with the maintenance of keeping in compliance with and within federal state laws and regulations.
Hannah K
27/01/2024
A trusted colleague/friend of mine actually referred me to Andy's firm and I'm really grateful!
He and his team were incredibly prompt, informative, helpful, and patient (with inevitable questions that came there way by a new business owner like myself). With all the specificities it takes to create a business, this team was awesome in communicating with me and assisting me with navigating not only the needs to get the ball rolling but also how to keep it rolling and with tips to help with bank accounts and accounting packages (if I were to want to take those routes).
They were also very neutral in providing all the options possible and when I requested advisement or pros/cons, they were able to share these promptly and in a way that helped me choose what was best for me.
I'm glad to have worked with them and will continue to work with them
Courtnie L.
07/11/2023
I am so grateful for Andy Gale and his firm's help in getting my S Corp established. He has great expertise and I feel more at ease knowing everything was set up properly with their assistance!
X
Incorporation Attorney
1820 W Orangewood Ave Ste 104a, Orange, CA, United States
Andy and his team were a pleasure to work with! As an LMFT opening a private practice, I was nervous and felt like I didn't know what I was doing. Andy did a great job at explaining everything step by step. I got off of our kick-off call feeling confident and ready to take the next step to opening a practice! I decided to go with a corporation for my private practice. Andy and his team are thorough and answered all my questions throughout the process. I was surprised how quickly everything was taken care of. They also sent me emails along the way, giving me updates. I will be using them for my yearly legal needs. 10/10 recommend!
Julie Eyssallenne
12/11/2023
Andy and his team of professionals are amazing to work with. Not only are they extremely knowledgeable and professional, but they are also very friendly and easy to work with. They will always be my go-to. I appreciate Andy and his team!
Z D
12/01/2024
I could not be more pleased, and frankly impressed with the expertise, attention to detail, follow-up and professionalism of the whole office staff. Andrew Gale Esq is extremely knowledgeable of his craft. His overall approach to corporation creation and management took any doubt or apprehension I had about the process.
Thank you so much for everything and I look forward to a long relationship with your legal practice.
Zouhair Kevin Daif, FNP, Nursing P. C.