Business Services

Business Formation

What kind of business entity is right for you? Moroni Law Offices can help you decide what business form is best for you and your needs. We can guide you through other business startup issues, such as issues related to the legal relationships between the various parties and the associated contracts and agreements.

Starting a New Business

The first decision is to choose the most appropriate form of business entity for your business. Most people choose an entity chartered by the Territory, such as a corporation or limited liability company, that affords the owners protection from personal liability for the debts of the business. We will work with you to determine which form of entity is best for your business and file the documents necessary to charter the new entity. We will work with your accountant regarding any required governmental registrations. Guam Bus. Resource Guide

The second issue concerns how much money the new business will require to get going. Most new businesses do not operate at a profit initially. We will work with you and your accountant to determine the right amount of capitalization and how the money will be invested in the business (e.g., purchase of equity, loans to the business). We will also advise you concerning how to structure the business to maximize tax advantages.

The next matter is to allocate power and money within the new business should your business have multiple owners. The law provides default rules regarding these matters. The owners of the business generally replace those default rules and apportion power and money among themselves as they agree. We will assist you in structuring the owners’ relationships among themselves. The contracts documenting such relationships include stockholders agreements and employment agreements.

Finally, we will work with you to create contracts for your business to use with your customers and assist you in evaluating and negotiating your contracts with third parties (e.g., your lease for office space).

Continuing Your Business

As your business grows, our business lawyers are available to help you with other issues, such as:

Commercial contracts
Employment agreements
Lease agreements
Maintenance of employment and termination agreements
Assisting clients in brokering their businesses
Purchases and sales of businesses and professional practices

Mergers and acquisitions
Business separations and dissolutions
Trademark and trade name registrations
Non-compete agreements
Buy-sell agreements
Registered agent services
Other transactional work

The Limited Liability Company

In choosing which form of business to operate under, your main concerns should be protecting your assets, minimizing your taxes, and operating smoothly. There is no one solution for every business. However, it is clear the Limited Liability Company (LLC) is greatly underused in Guam .

According to Revenue and Tax, there are only several hundred LLCs organized in Guam , compared with over 14,000 corporations. It seems many starting entrepreneurs opt for the corporate form without fully exploring alternatives. One reason may be the higher filing fee. For many businesses, an LLC can provide more tax options than a corporation, with greater asset protection, and more flexibility for management.

The LLC provides its owners greater protection from the liabilities of the company, because it does not require strict adherence to the corporate formalities. Record keeping requirements can be minimized without a threat that the members will be sued individually. Contrast this with a corporation, where, if the proper formalities are not followed, the corporate protection will be pierced and the owners will be responsible for the company's obligations.

Conversely, an LLC provides the company greater protection from the liabilities of the owners. Property held in an LLC cannot be seized by a creditor of an owner, and such a creditor cannot gain control of an LLC. A creditor of a majority stockholder of a corporation, by contrast, can simply seize the stock and reach the corporation's assets by dissolving the company.