The Gun Control Act of 1968, as amended by the 1994 Brady Handgun Violence Prevention Act, prohibits certain people from possessing a firearm. The possession of any firearm by one of these “prohibited persons” is a felony offense. It is also a felony for any person, including a registered Federal Firearms Licensee to sell or otherwise transfer any firearm to a person knowing or having “reasonable cause” to believe that the person receiving the firearm is prohibited from firearm possession. There are nine categories of people prohibited from possessing firearms under the Gun Control Act: • Persons under indictment for, or convicted of, any felony crime punishable by imprisonment for a term exceeding one year In addition, most persons under 18 years of age are prohibited from possessing handguns. These federal laws impose a life-long ban on gun possession by anyone convicted of a felony, as well as those merely under indictment for a felony. In addition, the federal courts have held that under the Gun Control Act, persons convicted of felonies are banned from owning guns even if they never serve jail time for the crime. Prohibited PersonsProhibited persons” may not possess firearms or ammunition. It is also unlawful to knowingly give a prohibited person firearms or ammunition. Those restrictions seem straight-forward, but there are unique definitions and exceptions that apply. These details should be understood so that you know exactly who is a prohibited person and precisely what they are prohibited from possessing. There are two categories of persons who may not possess firearms or dangerous weapons under Utah law. Penalties for weapons possession by category I restricted persons are more severe than the penalties for possession by category II restricted persons. Category I covers persons who have “been convicted of any violent felony” or are “on probation or parole for any felony” or have been “within the last 10 years an adjudicated delinquent for an offense which if committed by an adult would have been a violent felony”. Under Utah law, “A Category I restricted person who intentionally or knowingly agrees, consents, offers, or arranges to purchase, transfer, possess, use, or have under his custody or control, or who intentionally or knowingly purchases, transfers, possesses, uses, or has under his custody or control any firearm is guilty of a second degree felony.” Category II covers persons who have “been convicted of or are under indictment for any felony” or have “within the last seven years been an adjudicated delinquent for an offense which if committed by an adult would have been a felony” or are “an unlawful user of a controlled substance” or have “been found not guilty by reason of insanity for a felony offense” or have “been found mentally incompetent to stand trial for a felony offense” or have “been adjudicated as mentally defective as provided in the Brady Handgun Violence Prevention Act” or are “an alien who is illegally or unlawfully in the United States” or have “has been dishonorably discharged from the armed forces” or have “renounced his citizenship after having been a citizen of the United States”. A Category II restricted person who purchases, transfers, possesses, uses, or has under his custody or control any firearm is guilty of a third degree felony under Utah law. In addition to any person who has been convicted of any offense listed under §6105(b), the following persons shall not be eligible for or permitted to possess a firearm: • You are a fugitive from justice. • You are an alien who is illegally or unlawfully in the United States. • You, as a juvenile, were adjudicated delinquent of the below mentioned offenses, or under any equivalent Federal statute, or statute of any other state: • §2502 (relating to Murder) • You, as a juvenile, were adjudicated delinquent of any of the offenses mentioned in §6105(b) or under any equivalent Federal statute, or statute of any other state with the exception of those crimes mentioned in paragraph 7. This prohibition will terminate 15 years after the last applicable delinquent adjudication or upon the person reaching the age of 30, whichever is earlier. • You are prohibited from possessing or acquiring a firearm under federal law because you have been convicted of a misdemeanor crime of domestic violence*. If the offense which resulted in the prohibition under 18 U.S.C. §922(g) was committed by a person in any of the following relationships: (i) the current or former spouse, parent or guardian of the victim; • You, as the subject of a temporary or active final protection from abuse order, were convicted under 18 Pa.C.S. §6105(a.1 of failing to relinquish a firearm or other weapon or ammunition to the Sheriff or other law enforcement agency as required by the order. This prohibition terminates five years after the date of conviction, final release from confinement or final release from supervision, whichever is later. What to Do if You’re a Prohibited PersonIf you are a prohibited person, stay away from firearms for as long as you remain a prohibited person. Possession of a firearm is enough to get you into trouble – it doesn’t have to be your firearm. Also, be extremely careful near firearms even if you’re not physically holding one. Depending on the situation, having access to a nearby firearm might be enough to get you into trouble. If you want to regain your right to possess a firearm, you should contact an attorney in the state where the event happened that keeps you from possessing firearms. You may be able to overturn your status as a prohibited person. It is rare, but it can happen. Whatever you do, do not try to have someone else get a firearm or ammunition for you. Prohibited Purchasers In UtahFederal law prohibits certain persons from purchasing or possessing firearms, such as felons, certain domestic abusers, and certain people with a history of mental illness. Utah law provides that, subject to certain limited exceptions, no person shall possess a firearm if he or she: • Has been convicted of any violent felony; • Is subject to a final domestic violence protective order if the order includes a finding that: A Category I restricted person who intentionally or knowingly agrees, consents, offers, or arranges to purchase, transfer, possess, use, or have under one’s custody or control, or who intentionally or knowingly purchases, transfers, possesses, uses, or has under one’s custody or control any firearm is criminally liable for a second degree felony. Gun Lawyer Free ConsultationWhen you need legal help with gun law in Utah, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
Firearms Dealers And Licensing Requirements Can A Limited Liability Company Be A Qualified International Buyer? Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/persons-prohibited-from-possessing-a-firearm/
0 Comments
Requirement of survival by 120 hours–Under probate code or governing instrument Co-owner Exceptions Protection of payers, third parties, and bona fide purchasers’ Personal liability of recipient. Except as provided in Subsection (4), an individual who is not (1) established by clear and convincing evidence to have survived an event, including the death of another individual, by 120 hours is considered to have predeceased the event. Except as provided in Subsection (4), for purposes of a (2) provision of a governing instrument that relates to an individual surviving an event, including the death of another individual, an individual who is not established by clear and convincing evidence to have survived the event by 120 hours is considered to have predeceased the event. Except as provided in Subsection (4), if: it is not established by clear and (a) convincing evidence that one of two co-owners with right of survivorship survived the other co-owner by 120 hours, 1/2 of the property passes as if one had survived by 120 hours and 1/2 as if the other had survived by 120 hours; and there are more than two co-owners and it (b) is not established by clear and convincing evidence that at least one of them survived the others by 120 hours, the property passes in the For the proportion that one bears to the whole number of co-owners. purposes of this subsection, “co-owners with right of survivorship” includes joint tenants, tenants by the entireties, and other co-owners of property or accounts held under circumstances that entitles one or more to the whole of the property or account on the death of the other or others. Survival by 120 hours is not required if: the governing instrument contains language (a) dealing explicitly with simultaneous deaths or deaths in a common disaster and that language is operable under the facts of the case; the governing instrument expressly (b) indicates that an individual is not required to survive an event, including the death of another individual, by any specified period or expressly requires the individual to survive the event by a specified period; but survival of the event or the specified period shall be established by clear and convincing evidence; the imposition of a 120-hour requirement (c) of survival would cause a non-vested property interest or a power of appointment to fail to qualify for validity under Section 75-2-1203 or to become invalid under Section 75-2-1203 ; but survival shall be established by clear and convincing evidence; or the application of a 120-hour requirement (d) of survival to multiple governing instruments would result in an unintended failure or duplication of a disposition; but survival shall be established by clear and convincing evidence. A payer or other third party is not liable for having made (5)(a) a payment or transferred an item of property or any other benefit to a beneficiary designated in a governing instrument who, under this section, is not entitled to the payment or item of property, or for having taken any other action in good faith reliance on the beneficiary’s apparent entitlement under the terms of the governing instrument, before the payer or other third party received written A payer or notice of a claimed lack of entitlement under this section. Other third party is liable for a payment made or other action taken after the payer or other third party received written notice of a claimed lack of entitlement under this section. Written notice of a claimed lack of (b) entitlement under Subsection (5)(a) shall be mailed to the payer’s or other third party’s main office or home by registered or certified mail, return receipt requested, or served upon the payer or other third party Upon receipt of in the same manner as a summons in a civil action. written notice of a claimed lack of entitlement under this section, a payer or other third party may pay any amount owed or transfer or deposit any item of property held by it to or with the court having jurisdiction of the probate proceedings relating to the decedent’s estate, or if no proceedings have been commenced, to or with the court having jurisdiction of probate proceedings relating to the decedent’s The court estates located in the county of the decedent’s residence. Shall hold the funds or item of property and, upon its determination under this section, shall order disbursement in accordance with the Payments, transfers, or deposits made to or with the determination. Court discharge the payer or other third party from all claims for the value of amounts paid to or items of property transferred to or deposited with the court. A person who purchases property for value and without (6)(a) notice, or who receives a payment or other item of property in partial or full satisfaction of a legally enforceable obligation, is neither obligated under this section to return the payment, item of property, or benefit nor is liable under this section for the amount of the payment But a person who, not or the value of the item of property or benefit. for value, receives a payment, item of property, or any other benefit to which the person is not entitled under this section is obligated to return the payment, item of property, or benefit, or is personally liable for the amount of the payment or the value of the item of property or benefit, to the person who is entitled to it under this section. If this section or any part of this (b) section is pre-empted by federal law with respect to a payment, an item of property, or any other benefit covered by this section, a person who, not for value, receives the payment, item of property, or any other benefit to which the person is not entitled under this section is obligated to return the payment, item of property, or benefit, or is personally liable for the amount of the payment or the value of the item of property or benefit, to the person who would have been entitled to it were this section or part of this section not pre-empted. Requirement That Heir Survive DecedentIn addition to determine who potential heirs might be, certain states have strict survival requirements in order for heirs to inherit their shares of the intestate decedent’s estate. I thought I would take this opportunity to discuss more in depth this requirement, and how it typically takes shape. In many states (including Alaska, California, Texas, Kentucky, Wisconsin, etc.), it is required that the relevant potential heir survive the decedent by at least 120 hours–5 full days– in order to be considered an heir entitled to inherit (remember heirs are determined at the time of the decedent’s death, prior to that time the class of people we think might be heirs are referred to as heirs apparent). The reality of the 120 hour requirement, then, is that if the heir apparent fails to survive the decedent by even 119 hours, then they are not entitled to the share. What this means in practice, is that the share merely passes on to the next relevant heir. So, for example, if the person who fails to survive is the child of the decedent, then their share would merely pass to their children (or issue). The main potential downside is that the heir apparent cannot utilize their estate plan in determining what they leave to their heirs, or other beneficiaries. In any case, however, the heirs down the line will still be entitled to shares according to their relationship to the decedent. State’s Express Intent to Avoid EscheatThis is the only explanation I can think of to explain why the Probate Code goes to great lengths detailing the order of intestate heirs, which includes predeceased spouse’s children, parents, or siblings. Additionally, even when it comes to the survival requirement, the state is willing to waive the requirement if it means the potential for escheat: The requirement of this section that a person who survives the decedent must survive the decedent by 120 hours does not apply if the application of the 120-hour survival requirement would result in the escheat of property to the state…Thus, it can be the case that the failure to survive the decedent by more than even 1 hour is sufficient enough if the only other alternative is the escheat of the property to the state. Therefore, it is more accurate to categorize this type of statute as one that attempts to streamline the process of determining heirs. If there are additional heirs, then the estate will pass to them should the 120 hour survival requirement not be fulfilled. Absent additional heirs, the buck stops with the heir apparent who failed to survive the decedent by 120 hours. Uniform Simultaneous Death ActThe Uniform Simultaneous Death Act is a uniform act enacted in some U.S. states to alleviate the problem of simultaneous death in determining inheritance. The Act specifies that, if two or more people die within 120 hours of one another, and no will or other document provides for this situation explicitly, each is considered to have predeceased the others. However, the Act contains a clause that states if the end result would be an intestate estate escheating to the state, the 120-hour rule is not to be applied. The Act was promulgated in 1940, when it was adopted by all 48 then-existing states. It was last amended in 1993. As of 2010, 19 states (Alaska, Arizona, Arkansas, Colorado, Hawaii, Kansas, Kentucky, Massachusetts, Montana, New Hampshire, New Mexico, New York, North Carolina, North Dakota, Ohio, Oregon, South Dakota, Utah, Virginia, and Wisconsin), as well as the District of Columbia and the Virgin Islands have explicitly adopted the Act in its current version. A number of other states have indirectly adopted the Act as part of the Uniform Probate Code. The Act primarily helps to determine the heirs of a person who has died intestate. The 120-hour period is intended to simplify estate administration by preventing an inheritance from being transferred more times than necessary. Survivorship Periods in Wills and TrustsA “survivorship period” is a standard feature of many wills and trust documents. A survivorship clause states that beneficiaries named in the document cannot inherit unless they live for a specific amount of time after the will- or trust-maker dies. This time is called a survivorship period, and commonly ranges from about five to 60 days. For example, a will might state that “a beneficiary must survive me for 45 days to receive property under this will.” It’s unusual to see a survivorship period longer than 60 days. If a survivorship period is more than 120 days, it could jeopardize the estate-tax-free transfer of assets from a deceased spouse to the survivor. Federal estate tax isn’t a concern for most people (more than 99.5% of estates don’t owe any tax), but even without the tax consequences, a long survivorship period isn’t necessary. Utah Survivorship PeriodUtah has a survivorship period. To inherit under Utah’s intestate succession law, the heir in question must survive the decedent by at least 120 hours. In addition, relatives conceived before you die but born after the decedent’s death are eligible to inherit as if they had been born while the decedent was alive. However, posthumous relatives must survive at least 120 hours after birth in order to be eligible for their inheritance. Immigration status is irrelevant when it comes to inheritance. If a relative of yours is entitled to a share of your assets, they can inherit no matter what their citizenship status is. Half-relatives inherit as much as “whole” relatives. For example, your half-sibling would get the same share as any other sibling. Utah considers non-probate transfers to be advancements on a relative’s share of the estate. That means if an heir receives life insurance proceeds or funds from a payable on death account, those amounts are calculated as part of that heir’s share. In addition, if you make a gift to a future heir while you are alive, and put in writing that this should be advancement on their inheritance, or if the inheritor puts it in writing, the value of the gift is subtracted from their share. Utah Probate Lawyer Free ConsultationWhen you need legal help with probate in Utah, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
Home Buying Agent vs. Real Estate Attorney Firearms Dealers And Licensing Requirements FINRA Fines Deutsche Bank Securities Can A Limited Liability Company Be A Qualified International Buyer? Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/utah-probate-code-75-2-702/ A limited liability company (LLC) is a corporate structure in the United States whereby the owners are not personally liable for the company’s debts or liabilities. Limited liability companies are hybrid entities that combine the characteristics of a corporation with those of a partnership or sole proprietorship. While the limited liability feature is similar to that of a corporation, the availability of flow-through taxation to the members of an LLC is a feature of partnerships. A limited liability company (LLC) is a hybrid legal entity having certain characteristics of both a corporation and a partnership or sole proprietorship (depending on how many owners there are). An LLC is a type of unincorporated association distinct from a corporation. The primary characteristic an LLC shares with a corporation is limited liability, and the primary characteristic it shares with a partnership is the availability of pass-through income taxation. As a business entity, an LLC is often more flexible than a corporation and may be well-suited for companies with a single owner. Although LLCs and corporations both possess some analogous features, the basic terminology commonly associated with each type of legal entity, at least within the United States, is sometimes different. When an LLC is formed, it is said to be organized, not incorporated or chartered, and its founding document is likewise known as its articles of organization, instead of its articles of incorporation or its corporate charter. Internal operations of an LLC are further governed by its operating agreement, rather than its bylaws. The owner of beneficial rights in an LLC is known as a member, rather than a shareholder. Additionally, ownership in an LLC is represented by a membership interest or an LLC interest (sometimes measured in membership units or just units and at other times simply stated only as percentages), rather than represented by shares of stock or just shares (with ownership measured by the number of shares held by each shareholder). Similarly, when issued in physical rather than electronic form, a document evidencing ownership rights in an LLC is called a membership certificate rather than a stock certificate. In the absence of express statutory guidance, most American courts have held that LLC members are subject to the same common law alter ego piercing theories as corporate shareholders. However, it is more difficult to pierce the LLC veil because LLCs do not have many formalities to maintain. As long as the LLC and the members do not commingle funds, it is difficult to pierce the LLC veil. Membership interests in LLCs and partnership interests are also afforded a significant level of protection through the charging order mechanism. The charging order limits the creditor of a debtor-partner or a debtor-member to the debtor’s share of distributions, without conferring on the creditor any voting or management rights. Limited liability company members may, in certain circumstances, also incur a personal liability in cases where distributions to members render the LLC insolvent. What is a QIB?A qualified institutional buyer (QIB), in United States law and finance, is a purchaser of securities that is deemed financially sophisticated and is legally recognized by securities market regulators to need less protection from issuers than most public investors. Typically, the qualifications for this designation are based on an investor’s total assets under management and specific legal conditions in the country where the fund is located. Rule 144A requires an institution to manage at least $100 million in securities from issuers not affiliated with the institution to be considered a QIB. If the institution is a bank or savings and loans thrift they must have a net worth of at least $25 million. If the institution is a registered dealer acting for its own account it must in the aggregate own and invest on a discretionary basis at least $10 million of securities of issuers not affiliated with the dealer. Certain private placements of stocks and bonds are made available only to qualified institutional buyers to limit regulatory restrictions and public filing requirements. Understanding Limited Liability Companies (LLCs)Limited liability companies (LLCs) are a business structure that is allowed under state statutes. The regulations surrounding LLCs vary from state to state. LLC owners are generally called members. Many states don’t restrict ownership, meaning anyone can be a member including individuals, corporations, foreigners and foreign entities, and even other LLCs. Some entities, though, cannot form LLCs, including banks and insurance companies. An LLC is a more formal partnership arrangement that requires articles of organization to be filed with the state. An LLC is much easier to set up than a corporation and provides more flexibility and protection. LLCs don’t pay taxes. Instead, profits and losses are listed on the personal tax returns of the owner(s). If fraud is detected or if a company hasn’t met legal and reporting requirements, creditors may be able to go after the members. Members’ wages are deemed operating expenses and are deducted from the company’s profits. Some Advantages• Choice of tax regime. An LLC can elect to be taxed as a sole proprietor, partnership, S corporation or C corporation (as long as they would otherwise qualify for such tax treatment), providing for a great deal of flexibility. • A limited liability company with multiple members that elects to be taxed as partnership may specially allocate the members’ distributive share of income, gain, loss, deduction, or credit via the company operating agreement on a basis other than the ownership percentage of each member so long as the rules contained in Treasury Regulation (26 CFR) 1.704-1 are met. S corporations may not specially allocate profits, losses and other tax items under US tax law. • The owners of the LLC, called members, are protected from some or all liability for acts and debts of the LLC, depending on state shield laws. • In the United States, an S corporation has a limited number of stockholders, and all of them must be U.S. tax residents; an LLC may have an unlimited number of members, and there is no citizenship restriction. • Much less administrative paperwork and record-keeping than a corporation. • Pass-through taxation (i.e., no double taxation), unless the LLC elects to be taxed as a C corporation. • Using default tax classification, profits are taxed personally at the member level, not at the LLC level. • LLCs in most states are treated as entities separate from their members. However, in some jurisdictions such as Connecticut, case law has determined that owners were not required to plead facts sufficient to pierce the corporate veil and LLC members can be personally liable for operation of the LLC) • LLCs in some states can be set up with just one natural person involved. • Less risk of being “stolen” by fire-sale acquisitions (more protection against hungry investors). • For some business ventures, such as real estate investment, each property can be owned by a separate LLC, thereby shielding the owners and their other properties from cross-liability. • Flexible membership: Members of an LLC may include individuals, partnerships, trusts, estates, organizations, or other business entities, and most states do not limit the type or number of members. Some of the DisadvantagesAlthough there is no statutory requirement for an operating agreement in most jurisdictions, members of a multiple member LLC who operate without one may encounter problems. Unlike state laws regarding stock corporations, which are very well developed and provide for a variety of governance and protective provisions for the corporation and its shareholders, most states do not dictate detailed governance and protective provisions for the members of a limited liability company. In the absence of such statutory provisions, members of an LLC must establish governance and protective provisions pursuant to an operating agreement or similar governing document. • It may be more difficult to raise financial capital for an LLC as investors may be more comfortable investing funds in the better-understood corporate form with a view toward an eventual IPO. One possible solution may be to form a new corporation and merge into it, dissolving the LLC and converting into a corporation. • Many jurisdictions—including Alabama, California, Kentucky, New York, Pennsylvania, Tennessee, and Texas—levy a franchise tax or capital values tax on LLCs. In essence, this franchise or business privilege tax is the fee the LLC pays the state for the benefit of limited liability. The franchise tax can be an amount based on revenue, an amount based on profits, or an amount based on the number of owners or the amount of capital employed in the state, or some combination of those factors, or simply a flat fee, as in Delaware. • Renewal fees may also be higher. Maryland, for example, charges a stock or nonstock corporation $120 for the initial charter, and $100 for an LLC. The fee for filing the annual report the following year is $300 for stock-corporations and LLCs. The fee is zero for non-stock corporations. In addition, certain states, such as New York, impose a publication requirement upon formation of the LLC which requires that the members of the LLC publish a notice in newspapers in the geographic region that the LLC will be located that it is being formed. For LLCs located in major metropolitan areas (e.g., New York City), the cost of publication can be significant. • The management structure of an LLC may not be clearly stated. Unlike corporations, they are not required to have a board of directors or officers. (This could also be seen as an advantage to some.) • Taxing jurisdictions outside the US are likely to treat a US LLC as a corporation, regardless of its treatment for US tax purposes—for example a US LLC doing business outside the US or as a resident of a foreign jurisdiction. This is very likely where the country (such as Canada) does not recognize LLCs as an authorized form of business entity in that country. • The principals of LLCs use many different titles—e.g., member, manager, managing member, managing director, chief executive officer, president, and partner. As such, it can be difficult to determine who actually has the authority to enter into a contract on the LLC’s behalf. Forming an LLCAlthough the requirements for LLCs may vary by state, there are generally some commonalities across the board. The very first thing owners or members must do is to choose a name. Once that’s done, the articles of organization must be documented and filed with the state. These articles establish the rights, powers, duties, liabilities, and other obligations of each member of the LLC. Other information included on the documents includes the name and addresses of the LLC’s members, the name of the LLC’s registered agent, and the business’ statement of purpose. The articles of organization must be accompanied by a fee paid directly to the state. Paperwork and additional fees must also be submitted at the federal level to obtain an employer identification number (EIN). • Limited liability companies are corporate structures in the United States where owners are not personally liable for the company’s debts or liabilities. • Regulations surrounding LLCs vary from state to state. • Any registered dealer, acting for its own account or the accounts of other QIBs, that in the aggregate owns and invests on a discretionary basis at least $10 million of securities of issuers that are not affiliated with the dealer. Securities Lawyer Free ConsultationWhen you need legal help with securities, the SEC or private placements, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
Parents Rights Custody And Liability Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/can-a-limited-liability-company-be-a-qualified-international-buyer/ Although nearly all firearms in the United States are originally sold by licensed gun dealers, these dealers are subject to very little federal scrutiny. The lack of oversight, due to inadequate funding and gun lobby-backed legislation, too often allows corrupt or irresponsible gun dealers to endanger public safety without any accountability or consequences. Firearms initially enter the consumer market through gun dealers, who are the critical link between manufacturers or distributors and the general public. Even though all guns that are sold to the public, including guns that end up recovered in crimes, originate with dealers, dealers are subject to very little federal oversight. Over 56,600 individuals currently have “Type 1” federal firearms licenses, which allow them to act as firearms dealers, and almost 8,000 individuals have “Type 2” licenses, which allow them to buy and sell guns as pawnbrokers. About 71,452 individuals have other types of federal firearms licenses. Federal dealer licenses are in high demand because a dealer may purchase unlimited quantities of firearms through the mail, at wholesale prices, without being subject to background checks or any state or local waiting periods. GUN DEALERS AND TRAFFICKINGOversight of dealers is critical because gun dealers represent a major source of illegally trafficked firearms. Despite the need for strong dealer oversight, ATF faces numerous obstacles that enable corrupt dealers to go undetected and unpunished. For example, ATF may conduct only one unannounced inspection of each dealer per year, the burden of proof for prosecution and revocation are extremely high, and serious violations of firearms laws have been classified as misdemeanors rather than felonies. In addition, ATF has historically been grossly underfunded and understaffed. FFLs must be monitored to ensure that firearms are not stolen or trafficked. Missing guns pose a serious risk to public safety because they may end up in criminal hands and cannot be traced to the initial purchaser. Federal law makes it unlawful for any person except a licensed dealer to “engage in the business” of dealing in firearms. As applied to a firearms dealer, the term “engaged in the business” is defined as: person who devotes time, attention, and labor to dealing in firearms as a regular course of trade or business with the principal objective of livelihood and profit through the repetitive purchase and resale of firearms, but such term shall not include a person who makes occasional sales, exchanges, or purchases of firearms for the enhancement of a personal collection or for a hobby, or who sells all or part of his personal collection of firearms. By contrast, a so-called “private seller” (one who is not “engaged in the business”) is exempt from federal licensing requirements. A Federal Firearms License (FFL) is a license in the United States that enables an individual or a company to engage in a business pertaining to the manufacture or importation of firearms and ammunition, or the interstate and intrastate sale of firearms. Holding an FFL to engage in certain such activities has been a legal requirement within the United States since the enactment of the Gun Control Act of 1968. The FFL is issued by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (BATFE, commonly known as the “ATF”). A gun shop (also known by various other names such as firearm store and gun store) is a business establishment that sells small arms, such as handguns and shotguns, to individuals in an open shopping format. It may also provide repairs for firearms and their parts. Other items such as ammunition and accessories for hunting are frequently sold on the premises as well, even including souvenir t-shirts. Often having designs reminiscent of other establishments such as department stores displaying various items of clothing on racks and grocery stores displaying various foodstuffs on shelves, these firms operate under widely different gun control laws depending on the specific nation-state and locality involved. Some locations may only employ a single gunsmith in a small space while others might have many individuals working in a large space. The arms industry, also known as the defense industry or the arms trade, is a global industry which manufactures and sells weapons and military technology. It consists of a commercial industry involved in the research and development, engineering, production, and servicing of military material, equipment, and facilities. Arms-producing companies, also referred to as arms dealers, defense contractors, or as the military industry, produce arms for the armed forces of states and for civilians. Departments of government also operate in the arms industry, buying and selling weapons, munitions and other military items. An arsenal is a place where arms and ammunition – whether privately or publicly owned – are made, maintained and repaired, stored, or issued, in any combination. Products of the arms industry include guns, artillery, ammunition, missiles, military aircraft, military vehicles, ships, electronic systems, night-vision devices, holographic weapon sights, laser rangefinders, laser sights, hand grenades, landmines and more. The arms industry also provides other logistical and operational support. A firearms license (also known as a gun license) is a license or permit issued by a government authority (typically by the police) of a, that allows the licensee to buy, own, possess, or carry a firearm, often subject to a number of conditions or restrictions, especially with regard to storage requirements or the completion of a firearms safety course, as well as background checks, etc. Firearms licenses are not required in all jurisdictions. Additionally, some countries or states may require by law a “permit-to-purchase” in order to buy handguns or firearms The permit or license scope varies according to what firearm(s) or activity(s) it allows the holder to legally do with the firearm. Some jurisdictions may require a firearm license to own a firearm, to engage in hunting, target shooting or collecting, or to carry a concealed firearm, or operate a business (such as being a gun dealer or a gunsmith). Some jurisdictions may require separate licenses for rifles, shotguns or handguns. A criminal background check is required if a gun is purchased from a licensed dealer. STATES WITH STRICT LIABILITY on FIREARMS DEALERSTwo states—Connecticut and Pennsylvania—as well as the District of Columbia, impose strict liability on firearms dealers under certain circumstances. In Connecticut, any person who sells, delivers or otherwise transfers a firearm to a person knowing that person is prohibited from possessing such firearm “shall be strictly liable for damages for the injury or death of another person resulting from the use of such firearm by any person.” Connecticut also provides that any person who sells, delivers or provides any firearm to another person to “engage in conduct which constitutes an offense knowing or under circumstances in which he should know that such other person intends to use such firearm in such conduct shall be criminally liable for such conduct and shall be prosecuted and punished as if he were the principal offender.” The District of Columbia provides that any firearms dealer who can be shown by a preponderance of the evidence to have knowingly and willfully engaged in the illegal sale of a firearm will be strictly liable in tort for all damages caused by the discharge of the firearm in the District, regardless of whether the person operating the firearm is the original, illegal purchaser. A strict liability action may not be brought, however: Federal law requires federally licensed firearms dealers (but not private sellers) to initiate a background check on the purchaser prior to sale of a firearm. Federal law provides states with the option of serving as a state “point of contact” and conducting their own background checks using state, as well as federal, records and databases, or having the checks performed by the FBI using only the federal National Instant Criminal Background Check System (“NICS”) database. (Note that state files are not always included in the federal database.) Utah is a point of contact state for NICS. Utah law provides that, before transferring a firearm, all firearm dealers in Utah must contact the Criminal Investigations and Technical Services Division of the Department of Public Safety (more commonly known as the Bureau of Criminal Identification, or BCI), which conducts the background check referenced above. The dealer must require an individual receiving a firearm to present one form of government-issued photo identification. The individual must consent in writing to the background check and provide personal information on a form provided by BCI. The dealer must then contact BCI by telephone or electronic means. BCI is required to review criminal history files, including juvenile court records, to determine if the individual is prohibited from purchasing or possessing a firearm by state or federal law, prior to approving a firearm transfer. The dealer may not transfer the firearm until receiving approval from BCI. Federal law does not require dealers to conduct a background check if a firearm purchaser presents a state permit to purchase or possess firearms that meets certain conditions. As a result, Utah concealed handgun license holders are exempt from the federal background check requirement when purchasing a firearm. Utah law also exempts concealed handgun license holders from the state provision requiring a background check. (Note, however, that people who have become prohibited from possessing firearms may continue to hold state firearms licenses if the state fails to remove these licenses in a timely fashion.) Firearms transfers by private sellers (sellers who are not licensed as firearms dealers) are not subject to background checks in Utah. DEALER DUTIES AND PROHIBITIONSOnce licensed, federal law requires dealers to: Firearms Lawyer Free ConsultationWhen you need legal help with gun law in Utah, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
What Are The Advantages Of Private Placements? 10 Ways Your Spouse Can Hide Money In Divorce Life Insurance Policy To Lower Estate Tax Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/firearms-dealers-and-licensing-requirements/ Purchasing a home will likely be the largest and most significant transaction of your life, which is why many people choose to hire a real estate agent to assist in the search and negotiate on their behalf. Real estate agents generally fall into two categories: home buying agents and home selling agents. Home buying agents aim to level the playing field a bit for homebuyers (almost all sellers have seller’s agents, whose job is to get the very highest price for the property) through the agents’ knowledge of the industry and familiarity with the particulars of a neighborhood, sellers, contractors, etc. Some states require the use of buying agents to ensure fair dealing between buyers and sellers. In addition to, and perhaps in place of, buying agents, homebuyers may also employ real estate attorneys to represent their interests in the purchase of a home. Attorneys are experts in real estate law and can provide counsel on legal issues which may arise. Whether you hire a buying agent or a lawyer, you’ll be paying them for their services (more on agent commissions below), so the question is: which is preferable? State LawsSome states require buying agents while other states stipulate that only attorneys can prepare home purchase agreements. You’ll have to investigate to determine the laws in your state. This article will assume that there is no law requiring either a home buying agent or a real estate attorney. Hiring a Buying AgentThe primary reasons to hire a buying agent are obvious–home purchases are significant and the process of finding a home is burdensome, therefore it’s a relief and an assurance to have an agent who will walk you through the process and look out for your interests. Buying agents can be very helpful in hiring inspectors, negotiating over who will pay for repairs, finding listings, and other matters which are everyday activities for agents, but may be foreign to most homebuyers. Choosing an AgentHome sales have traditionally favored sellers. Sellers have selling agents, who sometimes aim to become buying agents as well. Be wary of so called dual representation, because in the end you can’t be sure whose best interest the seller has in mind. Don’t be shy about asking potential buying agents if they are seller’s agents. You should be positive about whom the agent is representing. When searching for a buying agent, keep in mind that they are in high demand during housing booms. In a depressed market, the demand for buying agents is quite low. You can use this fact to negotiate a lower commission and take your time in finding the right house. How Buying Agents Are PaidIn a typical arrangement, real estate agents are paid through commission–generally around 5% of the home’s purchase price. In the common two agent situation (the seller’s agent and the buyer’s agent), the agents split the 5% and the commission is paid by the seller. Some buyers prefer to pay commission to the buying agent in order to retain the complete loyalty of the agent, however, because of the inherent conflict of interest when the buying agent, who is purportedly representing the homebuyer, is being paid by the seller. Whether or not you choose to pay the buying agent yourself, you shouldn’t be shy in asking them directly who the agent really represents. Keep in mind that during strong homebuyer’s markets you can try to negotiate a lower commission for the agent if you so desire. Just remember that you’ll already be getting an excellent value on your home due to the depressed prices. Driving a very hard bargain with the person whose job it is to find the perfect home for you may discourage them from zealously pursuing the purchase of your home. Keep Informed and Stay in ControlNo matter who you hire, you should stay in control of the process. Don’t let the agent pressure you when it comes to homes, neighborhoods, or home attributes that you don’t feel comfortable with or don’t want. Particularly in down markets, the buyer reigns supreme and you should make sure that your buying agent knows exactly what you want. Additionally, you should stay proactive in your search. There are plenty of commercial websites which not only provide listings of homes for sale, but give detailed information such as the market value of the home and the date and price of its last sale. Check out www.zillow.com or www.trulia.com and you will have a better idea of what a reasonable bid looks like and may even find listings which your agent may not know about or may not want to show you. Letting your agent know about what you’ve found will not only increase your options, but will keep the agents on their toes with the knowledge that their buyer has the ability to find a home on their own. Reasons to Hire an AttorneyIn most states, real estate attorneys are not required by law for the purchase of a home. While a home purchase is a significant investment, the actual sale is fairly standardized, with boilerplate clauses and lots of filling in blanks. In the event of a legal problem related to the purchase of a home, however, only a licensed attorney may provide legal counsel and represent you in court (although you can, of course, always represent yourself). For example, if there are liens or other legal encumbrances on the property or there is a tenant who you want to evict in order to rent to another person–an experienced real estate lawyer can investigate and analyze the facts and then guide you on how, or even if, you should proceed. Legal Review and ConfidentialityAttorneys can also be very useful in reviewing contracts. Particularly if you are purchasing a home without a buying agent, you should have an attorney review the contract to make sure that you will not be subject to terms which unfairly favor the seller. In addition, attorneys are bound by strict professional rules of confidentiality. In the event that you wish to keep your cards very close to the vest, your attorney is prohibited from exposing information which you do not wish to make known. You can speak to an attorney with complete candor without worrying that the information will be released in any fashion. How Attorneys Are PaidUnlike real estate agents, most lawyers are paid on an hourly basis, and therein lies the biggest drawback of hiring a real estate lawyer in the purchase of your home–attorney’s fees range from $175-$400 per hour. However, there are attorneys who charge flat fees for certain services such as preparing or reviewing closing documents, and you can also tell an attorney upfront that you can only afford a specific number of hours. Communication with an attorney about payment should be clear from the beginning so that there are no misunderstandings, and it should always be put in writing. Whether you choose to hire a buying agent, a real estate attorney, or both, remember that you are in charge of the process and they are there to provide you with a service. Be clear in communicating your needs and desires, get agreements in writing, and stay active in the process. Free Initial Consultation with LawyerIt’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
Problematic Areas Of Foreclosure What Should I Do Before Filing For Divorce? Difference Between A Divorce And Annulment Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/home-buying-agent-vs-real-estate-attorney/ In Utah, as in many other states, there are two ways to administer the estate of a decedent in probate. In Utah these are called formal and informal probate. Other states may have different names. Georgia, for example, calls its two methods of probate solemn and common. In Utah, informal probate is the more common. It’s simpler, faster and generally less expensive. All that has to be done is to file an application for probate with the will. The application for probate names the proposed personal representative (also known as the executor) and lists the names and addresses of the heirs. Then the court gives notice of the application to the heirs, who have a period of time in which to object the appointment of the personal representative. If there is no objection, the application is granted and the applicant is named as personal representative. Letters Testamentary are also issued by the court. This is a document that gives the personal representative the power to act on behalf of the estate, such as signing documents such as deeds or contracts to sell property, taking control of bank and financial accounts and doing everything necessary to administer the estate. That’s about the only involvement with the court system that there is in an informal probate. A formal probate starts out much the same way with the appointment of the personal representative. However, after that much more is involved. Notices to creditors to file claims against the estate have to be given, either by mail or publication. There is a waiting period in which claims can be filed. The personal representative files periodic reports with the court of property she collects and claims she pays. When the probate is finally administered (meaning all property has been collected, all bills have been paid and all remaining property has been distributed to the heirs) there is a final accounting and the personal representative is discharged and the probate closed. Why Would Anyone Use Formal Probate?It’s longer, more complicated and more expensive. The reasons for using formal probate all have to do with the protection given the estate and personal representative by the court’s supervision. After notice to creditors is given, after the claim period has expired and after the estate is closed, any claims are cut off. Neither the estate nor the personal representative has any further liability for any debts unless gross malfeasance or fraud is shown. In informal probate, if a claim arises years later, the estate or personal representative could potentially be held liable. One advantage, besides simplicity, that informal probate has over formal probate is that the probate is never closed. So if, years after the fact, some property is discovered, such as shares of stock or a forgotten life insurance policy, the appointed personal representative can deal with it without having to reopen the probate. What Are My Probate Options?• Small Estate Affidavit: You may be able to avoid filing a probate by signing a small estate affidavit, which can be used to collect a decedent’s Utah property, except real estate, if the net value of the decedent’s property subject to probate does not exceed $100,000. A small estate affidavit is not legally available, however, until 30 days after the decedent’s death. • Filing Options. If filing a Utah probate cannot be avoided, the most common filing options are: • Informal probate, which is generally appropriate for simple, uncontested estates and usually costs less than a formal probate because no attorney travel or in-court time is required. In some circumstances, the decedent’s relatives may be required to sign written consents to this process. • Formal probate, which is appropriate for estates in which the right of the person seeking appointment as personal representative is contested or in which some other dispute may arise. Formal probate requires an in-court hearing, which the attorney (but not the client) is required to attend. • Order determining heirs, which are appropriate when the decedent’s Utah real estate or other property located in Utah, needs to be sold and more than three years have passed since the decedent’s death. • Ancillary probate for out-of-state decedents. This option can be used when the decedent resided outside Utah at the time of death, a probate has been filed there, and the decedent owned Utah real estate or other property that needs to be sold. What You Need for File A Formal Probate For An EstateFormal probate matters are typically heard by a judge and may involve one or more hearings before the court. A formal probate proceeding requires both written notice and publication notice before the allowance of the formal petition. There are different forms you’ll need to file depending on whether or not the decedent (the person who has died) died with a will. • Petition for Formal Probate of Will and/or Appointment of Personal Representative How to File file a Formal Probate for an EstateIn person • File in any county where the decedent had property when they died. You may need to file additional forms in the state where the decedent lived as well. • Serve thenotice: After you file and pay for a formal petition, the Registry of Probate will issue formal notice to the petitioner (the person filing for probate). The formal notice is called a citation. You’ll need to serve a copy of the citation on all interested persons and publish a copy in the newspaper listed in the Order of Notice. When planning your estate and your future, there are always many different decisions that need to be made ranging from your particular financial needs to the types of estate planning instruments that will best accomplish your goals to who should be the beneficiary of your will or a trust. One thing that will not be planned by you personally will be whether your estate goes through informal or formal probate after you pass away. Your personal representative will probably be the one who makes this decision, but it is still important to understand the difference between the two processes. Informal probate begins when a personal representative makes application to a probate registrar. In informal probate, the application does not go to a judge. It is very important to make sure the personal representative completes the paperwork accurately as there will not be a probate hearing; the paperwork will be what the probate registrar uses in order to make all decisions that come up in the future. The paperwork needs to include a variety of information, ranging from the names of the heirs, the assets and debts of the estate, and personal information of the decedent. In some counties, the application must be presented in person to the registrar, but in many counties, the application may be simply mailed in. If the application is approved by the probate registrar, notice can then be sent to all interested parties such as heirs, creditors, and the personal representative, if that is not the person who filed the application. The personal representative will receive letters testamentary from the registrar allowing him or her to take action to dissolve the estate, such as paying off debts and selling assets. Informal probate can go forward with very little oversight from the courts. By contrast, formal probate begins with the filing of a petition asking a judge to decide if the will is valid, appoint a personal representative, and determine the heirs of the deceased. In some cases, the petition may also request that the process be supervised, which mean the court would must approve distributions to the heirs before they are made. Formal probate may be appropriate where there are minors who stand to inherit; there is a dispute over the validity or existence of the will, or not knowing who should be appointed as the personal representative of the estate. When a person dies, they are called a decedent. A decedent leaves property behind. That property needs to be passed on to those who will inherit it. The property could include: • Jointly owned property Jointly Owned PropertyJointly owned property is property owned by more than one person. It is generally not included in an estate. Examples of jointly owned personal property are if you and the decedent are both listed on the title of a car or if you have a joint bank account. When the decedent died, you automatically had full ownership of that property, so it is not part of the estate. You may want to take a copy of the decedent’s death certificate to the bank or Secretary of State Office to remove the decedent’s name from the account or car title. However, sometimes joint ownership is more complex. If you own real property with the decedent, or if you own any property with the decedent and someone else, ownership can be hard to understand after a death. There are different ways an estate can be administered. If the estate does not have much property in it, you may be able to use a simplified process where the probate court is not involved at all, or only a little bit. The simplified processes are: Appointing a Personal RepresentativeThe order from highest to lowest priority is: • The state or county public administrator (this person must wait 42 days after the decedent’s death, and there must be no known heir or U.S. resident beneficiary entitled to a share of the decedent’s estate) Formal Probate Lawyer Free ConsultationWhen you need a Utah Formal Probate, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
Problematic Areas Of Foreclosure Rights Of Divorced Spouses In The Military Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/utah-formal-probate/ One major advantage of a private placement is that the issuer isn’t subject to the SEC’s strict regulations for a typical public offering. With a private placement, the issuing company isn’t subject to the same disclosure and reporting requirements as a publicly offered bond. Furthermore, privately placed bonds don’t require credit-agency ratings. Another advantage of private placement is the cost and time-related savings involved. Issuing bonds publicly means incurring significant underwriter fees, while issuing them privately can save money. Similarly, the process can be expedited when done in a private manner. Furthermore, private placement deals can be custom-built to meet the financial needs of both the issuer and investors. Some Advantages Of A Private Placement• Speed in raising finance: If a company goes in for a fresh issue through public issue there are lot of procedures to be followed which take a lot of time. On the other hand, it is possible to raise resources through private placement within 1 or 2 months. Regulatory Requirements for Private PlacementsWhen a company decides to issue shares of an initial public offering, the U.S. Securities and Exchange Commission requires the company to meet a lengthy list of requirements. Detailed financial reporting is necessary once an initial public offering is issued, and any shareholder must be able to access the company’s financial statements at any time. This information should provide enough disclosure to investors so they can make informed investment decisions. Private placements are offered to a small group of select investors instead of the public. So, companies employing this type of financing do not need to comply with the same reporting and disclosure regulations. Instead, private placement financing deals are exempt from SEC regulations under Regulation D. There is less concern from the SEC regarding participating investors’ level of investment knowledge because more sophisticated investors (such as pension funds, mutual fund companies, and insurance companies) purchase the majority of private placement shares. Saved Cost and TimeEquity financing deals such as initial public offerings and venture capital often take time to configure and finalize. There are extensive vetting processes in place from the SEC and venture capitalist firms with which companies seeking this type of capital must comply before receiving funds. Completing all the necessary requirements can take up to a year, and the costs associated with doing so can be a burden to the business. The nature of a private placement makes the funding process much less time-consuming and far less costly for the receiving company. Because no securities registration is necessary, fewer legal fees are associated with this strategy compared to other financing options. Additionally, the smaller number of investors in the deal results in less negotiation before the company receives funding. The greatest benefit to a private placement is the company’s ability to remain a private company. The exemption under Regulation D allows companies to raise capital while keeping financial records private instead of disclosing information each quarter to the buying public. A business obtaining investment through private placement is also not required to give up a seat on the board of directors or a management position to the group of investors. Instead, control over business operations and financial management remains with the owner, unlike a venture capital deal. Reasons to Issue A Private Placement• Privacy and Control: Private placements enable companies that value privacy to remain private. In contrast to public debt and equity offerings which require public filings, disclosures of company information and financing documents and terms private placement transactions are negotiated confidentially, and public disclosure requirements are limited. With a private placement, companies would not be beholden to public shareholders. • Ease of Execution: Private placement financings are regularly completed by both privately-held, middle-market companies as well as large public companies. These transactions provide issuers with access to capital on a scale that rivals underwritten public debt offerings, but without certain pre-conditional requirements, such as ratings, public registrations or minimum size restrictions. For public companies, private placements can offer superior execution relative to the public market for small issuance sizes as well as greater structural flexibility. Restrictions Affecting Private PlacementThe SEC formerly placed many restrictions on private placement transactions. For example, such offerings could only be made to a limited number of investors, and the company was required to establish strict criteria for each investor to meet. Furthermore, the SEC required private placement of securities to be made only to “sophisticated” investors—those capable of evaluating the merits and understanding the risks associated with the investment. Finally, stock sold through private offerings could not be advertised to the public and could only be resold under certain circumstances. In 1992, however, the SEC eliminated many of these restrictions in order to make it easier for small companies to raise capital through private placements of securities. The rules now allow companies to promote their private placement offerings more broadly and to sell the stock to a greater number of buyers. It is also easier for investors to resell such securities. Although the SEC restrictions on private placements were relaxed, it is nonetheless important for small business owners to understand the various federal and state laws affecting such transactions and to take the appropriate procedural steps. It may be helpful to assemble a team of qualified legal and accounting professionals before attempting to undertake a private placement. Many of the rules affecting private placements are covered under Section 4(2) of the federal securities law. This section provides an exemption for companies wishing to sell up to $5 million in securities to a small number of accredited investors. Companies conducting an offering under Section 4(2) cannot solicit investors publicly, and the majority of investors are expected to be either insiders (company management) or sophisticated outsiders with a preexisting relationship with the company (professionals, suppliers, customers, etc.). At a minimum, the companies are expected to provide potential investors with recent financial statements, a list of risk factors associated with the investment, and an invitation to inspect their facilities. In most respects, the preparation and disclosure requirements for offerings under Section 4(2) are similar to Regulation D filings. Regulation D which was adopted in 1982 and has been revised several times since consists of a set of rules numbered 501 through 508. Rules 504, 505, and 506 describe three different types of exempt offerings and set forth guidelines covering the amount of stock that can be sold and the number and type of investors that are allowed under each one. Rule 504 covers the Small Corporate Offering Registration, or SCOR. SCOR gives an exemption to private companies that raise no more than $1 million in any 12-month period through the sale of stock. There are no restrictions on the number or types of investors and the stock may be freely traded. The SCOR process is easy enough for a small business owner to complete with the assistance of a knowledgeable accountant and attorney. Rule 505 enables a small business to sell up to $5 million in stock during a 12-month period to an unlimited number of investors, provided that no more than 35of them are non-accredited. To be accredited, an investor must have sufficient assets or income to make such an investment. According to the SEC rules, individual investors must have either $1 million in assets (other than their home and car) or $200,000 in net annual personal income, while institutions must hold $5 million in assets. Free Initial Consultation with LawyerIt’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
What Is A Private Placement Of Stocks? Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/what-are-the-advantages-of-private-placements/ Foreclosure is the process lenders use to take property from borrowers. By taking legal action against a borrower who has stopped making payments, lenders try to get their money back. For example, they take ownership of your house, sell it, and use the sales proceeds to pay off your home loan. How Foreclosure WorksWhen you buy expensive property, such as a home, you might not have enough money to pay the entire purchase price up front. However, you can pay a portion of the price with a down payment, and borrow the rest of the money (to be repaid in future years). Homes can cost hundreds of thousands of dollars, and most people don’t earn anywhere near that much annually. Why are lenders willing to offer such large loans? As part of the loan agreement, you agree that the property you’re buying will serve as collateral for the loan: if you stop making payments, the lender can take possession of the property in order to recover the funds they lent you. To secure this right, the lender has a lien on your property, and to improve their chances of getting enough money, they (usually) only lend if you’ve got a good loan to value ratio. Consequences of ForeclosureThe main problem with going through foreclosure is, of course, the fact that you will be forced out of your home. You’ll need to find another place to live, and the process is stressful (among other things) for you and your family. Foreclosure can also be expensive. As you stop making payments, your lender will charge penalties and legal fees, and you might pay legal fees out of pocket to fight foreclosure. Any fees added to your account will increase your debt to the lender, and you might still owe money after your home is taken and sold if the sales proceeds are not sufficient (known as a deficiency). Foreclosure will also hurt your credit scores. Your credit reports will show the foreclosure, which credit scoring models will see as a negative signal. You’ll have a hard time borrowing to buy another home for several years (although you might be able to get certain government loans within one to two years), and you’ll also have more difficulty getting affordable loans of any kind. Your credit scores can also affect other areas of your life, such as (in limited cases) your ability to get a job or your insurance rates. How to Avoid ForeclosureForeclosure is a last resort for lenders who have given up hope of being paid. The process is time-consuming and expensive for them (but they can try to charge those fees to you), and it is extremely unpleasant for borrowers. So how can you avoid it? • Communication: it’s always a good idea to communicate with your lender if you’re having financial challenges. Get in touch before you start missing payments and ask if anything can be done. If you start missing payments, don’t ignore communication from your lender you’ll receive important notices telling you where you are in the process and what rights and options you still have. Speak with a local real estate attorney or HUD housing counselor to understand what’s going on. • Explore alternatives to keep your home: if you know that you won’t be able to make your payments, find out what options are available to you even if you think it’s too late. You might get help through government programs geared towards struggling borrowers. Your lender might offer some kind of loan modification, which would make your loan more affordable. You might even be able to work out a simple payment plan with your lender if you just need relief for a month or two (if you’re in between jobs, or for surprise medical expenses, for example). • Alternative ways to leave your home: Foreclosure is a long, unpleasant, expensive process that damages your credit. If you’re simply ready to move on (and you want to at least try to minimize the damage), see if your lender will agree to a short sale. This allows you to sell the house and use the proceeds to pay off your lender even if the loan isn’t completely repaid. Your credit will still suffer, but not as bad as it would after foreclosure. If that doesn’t work, another less attractive option is a deed in lieu of foreclosure. • Bankruptcy: Filing for bankruptcy might or might not help if you’re facing foreclosure. The issues are complex, so speak with a local attorney to get accurate information that’s tailored to your situation and your state of residence. • Scams: Because you’re in a desperate situation, you’re a target for con artists. Be wary of any unsolicited offers to help you avoid foreclosure, and choose carefully who helps you. Start seeking help from HUD counseling agencies and other reputable local agencies. Know the signs of foreclosure rescue scams. Foreclosure is generally a slow process. If you miss one or two payments, you’re probably not facing eviction. That’s why it’s important to communicate with your lender if you’ve fallen on hard times – it might not be too late. The details vary from lender to lender and laws are different in each state, so the description below is a rough overview and might not be exactly what you’ll experience, read all of your notices and agreements carefully and speak with an attorney or HUD housing counselor to make sure you know what’s happening. The entire process could take a year or two, or it could move much faster. • Notices start: once you’ve missed payments for three months, many lenders consider your loan in default. This is when things get critical. You will, of course, receive communications as soon as you miss a payment (or two), and those communications might include a notice of intent to move forward with the foreclosure process. • Judicial and non-judicial states: Depending on what state you’re in, you’ll have more time (and receive more notices) than others. There are two types of states – judicial states and non-judicial states. In judicial states, your lender must bring legal action against you in the courts to foreclose. This process takes longer, as you often have 30 to 90 days in between each event. In non-judicial states, lenders can foreclose based on the agreements you’ve signed with them, and a judge is not involved. As you might imagine, things move much faster in non-judicial states. In either type of state, you can fight the foreclosure in court in a judicial state you’ll generally be served with a summons, but in a non-judicial state you’ll need to bring legal action against your lender to stop the foreclosure process. Speak with a local attorney for more details. • Stopping the process: In most states, lenders are required to offer borrowers some kind of a relief to stop the foreclosure process. Whether or not those options are realistic or feasible is another matter. Lenders might say that you can reinstate and stay in the home if you make all (or a substantial portion) of your missed payments and cover the legal fees and penalties charged so far. You might also have an opportunity to pay off the loan in its entirety (which will only happen if you manage to refinance or find a huge source of money). • Auction and eviction: If you’re unable to prevent foreclosure, the property is made available to the highest bidder at auction. If nobody else buys the home (which is common), ownership goes to the lender. At that point, if you’re still in the house (and haven’t made arrangements to protect the house), you face the possibility of eviction and it’s time to line up new accommodations. Local laws dictate how long you can remain in the house after foreclosure, and you should receive a notice informing you how long you can stay. Ask your former lender about any “cash for keys” incentives, which can help ease the transition to new housing (assuming you’re ready to move quickly). Facing a foreclosure can be daunting prospect for people in trouble with their mortgages, especially when they are unsure of what to do. Across the country, six out of 10 homeowners questioned said they wished they understood their mortgage and its terms better. The same percentage of homeowners also said they were unaware of what mortgage lenders can do to help them through their financial situation. The first step to working through a possible foreclosure is to understand what a foreclosure means. When someone buys a property, they typically do not have enough money to pay for the purchase outright. So they take out a mortgage loan, which is a contract for purchase money that will be paid back over time. A foreclosure consists of a lender trying to reclaim the title of a property that had been sold to someone using a loan. The borrower, usually the homeowner living in the house, is unable or unwilling to continue making mortgage payments. When this happens, the lender that provided the loan to the borrower will move to take back the property. How do Foreclosures Relate to Debt?Some people facing foreclosure find themselves in this position because of mounting debt that made it harder to make their mortgage payments. A foreclosure can add to your financial problems if your state allows a deficiency judgment, which means the borrower owes the difference between what is owed on the foreclosed property and the amount it eventually sells for at an auction. Thirty-eight states allow financial institutions to pursue borrowers for this money. In cases when a lender does not use a deficiency judgment, a foreclosure can relieve some of your financial burden. Although it is a loss when a lender takes the home you partially paid for, it can be a start to rebuild your finances. It is a good idea to work with a financial adviser or a debt counselor to understand what kind of debt you may incur during a foreclosure. If you are thinking about going into foreclosure, there are a number of things to consider: • A foreclosure dramatically affects your credit score. Fair Isaac, the company that created FICO (credit) scores, drops credit scores from 85 points to 160 points after a foreclosure or short sale. The amount of the drop depends on other factors, such as previous credit score. • Get in touch with your lender as soon as you are aware that you are having difficulty making payments. You may be able to avoid foreclosure by negotiating a new repayment plan or refinancing that works better for you. • States have different rules on how foreclosures work. Understand your rights and get a sense of how long you can stay in your home once foreclosure proceedings begin. • Look out for scammers hoping to profit from your misfortune. If you decide to work with a company to help you through your foreclosure, get everything in writing and understand the fees and contract involved. How Long Does Foreclosure Take in Utah?For many homeowners, foreclosure is an unfortunate reality; and one that’s entirely outside of their control. But how long does foreclosure take? It will actually vary depending on any number of circumstances. The length of foreclosure time is actually relatively flexible. And believe it or not, there may be options available that can help diminish its long-term effects. “What many people don’t realize is that the stipulations of a foreclosure are different from state to state. “Also how you purchased your home, as well as any personal relationship with a lender” can influence the effects of reducing or stopping foreclosure in Utah. Right of RedemptionUtah law maintains a grace period known as the “right of redemption,” which can allow you to purchase property back during instances of judicial foreclosure (where proceedings occur through the courts; as in the case of mortgages serving as property liens.) Payment is made in full of the sum of the unpaid loan, plus additional costs. Courts can extend the redemption period, in some cases up to two years; but it’s important to keep in mind this only occurs under judicial foreclosure, which is less common in Utah. You Have Limited Time to Avoid ForeclosureNo news is never good news when you are behind on your mortgage payments. Your bank could be starting the foreclosure process and completing the necessary documents to take your home away from you. You might have already received notification that your home is entering the first phase of the foreclosure process. This does not mean that you will lose your home forever. Many homeowners give up prematurely and do not try to avoid foreclosure because they are not informed of their foreclosure law rights. There is help available. You do have options to save your home. Every day that you wait to seek help reduces your chances of staying in your home. The first step to defeating foreclosure is learning about your rights as a homeowner. You cannot sweep foreclosure letters under the rug and forget about them. Banks are vicious and know that you do not understand the foreclosure process or how to stop it. If you are falling behind on your mortgage payments, foreclosure is not your only options. There are several strategies that can be used to avoid foreclosure and minimize damage to your credit. • Reinstatement Foreclosure Lawyer Free ConsultationWhen you need legal help with foreclosure in Utah, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
What Is A Private Placement Of Stocks? Utah Protective Orders And Divorce Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/problematic-areas-of-foreclosure/ Class III NFA Weapons/Title 2 firearms are not as commonly known nor as straight forward as the Title 1 firearms. All class III /title 2 weapons fall into 1 of 6 different categories. • Machineguns, All title 2 firearms are regulated by what’s known as the National Firearm Act or what we refer to as NFA. One could spend months reading about NFA but I’ll hit the major misconception – which are, contrary to the assumptions by many individuals AND even law enforcement, that NFA weaponry: • Is legal in almost every state. Most all 6 categories above are allowed in just about all states within the Continental United States. A few states restrict machinegun ownership, others may restrict short barrelled shotguns (SBSs) or suppressors, etc. • One does not need to obtain a “Class III” weapons license to own. In fact, there really is no such thing as a class III NFA weapons license. When a Title 1 FFL dealer pays what is known as a Special Occupation Tax, he/she then becomes a SOT that can then deal in NFA/Title 2 weapons. SOTs have several classes too and they are based on the type of FFL license you currently hold. The term Class 3 comes from when a normal Type 1 (standard dealer) FFL holder pays his SOT tax. He becomes a Type 3 SOT hence the term Class 3. • Transferring ownership of an NFA weapon – All NFA weapons regardless of category (machineguns, silencers, etc.) are controlled during their transfer from one person/entity to another. These weapons transfer to another entity on what is called ATF tax forms. Each ownership transfer MUST be approved by the ATF before the transfer takes place. This approval takes sometimes many months. Generally individual transfer is approved in 3-4 months, dealer to dealer in 3-4 weeks. When the ATF approves the transfer, they cancel a tax stamp and this is why you sometimes hear some say class 3 stamp. Transfers from/to individuals require a one-time $200 tax stamp to be paid for EACH transfer (AOWs require just a $5 stamp). These are considered tax paid transfers and usually are on an ATF form 4. Dealers can transfer to other dealers using a tax free Form . If a person buys NFA weapon(s) or item from someone outside his/her domicile (home) state, the weapon must be transferred 1st to a SOT holder within the buyer’s state, similar to a Title 1 firearm transaction. It must go to a FFL/SOT dealer in the buyer’s state before going to the buyer. • Making of NFA weapons. In 1986 President Ronald Reagan signed a bill that basically stopped the making of any new machineguns. The Firearm Owners Protection Act, which would loosen restrictions on gun ownership with the reopening of interstate sales of long guns on a limited basis, legalization of ammunition shipments through the U.S. Postal Service (a partial repeal of the Gun Control Act), removal of the requirement for record keeping on sales of non-armour-piercing ammunition, and federal protection of transportation of firearms through states where possession of those firearms would otherwise be illegal, also contained an amendment, The Hughes Amendment which prohibited civilians from owning any machine gun manufactured after 1986. All the other 5 categories (SBRs, SBSs, Silencers, AOWs and Destructive Devices) however can still be made, even by an individual, if he/she first applies for and receives permission to do so. They will file an ATF Form 1 (maker form) and pay a $200 make tax fee. A civilian can still legally own any machinegun that was created PRIOR to May, 1986 as long as they get approval on the ATF form 4 discussed above. Remember that no civilian can possess a machinegun manufactured AFTER May 1986 except for law enforcement and military so there is a finite quantity available. • Utah is a special state when it comes to Class III NFA weapons. Part of the Form 1 or Form 4 approval process requires that you need to get local Chief Law Enforcement Official (Sheriff or Chief of City Police) to sign off on your form. Well, several years ago, a bill was passed in TN that makes it a SHALL SIGN state which means the Sheriff or Chief MUST sign approval for your transfer unless there is something in your NCIS background check that would otherwise prevent it. No other state does this. Some officials have erroneously associated their approval with liability on their part. When in all actuality, the signoff in the ATFs eyes is ONLY to state that the individual has nothing negative in his or her NCIS check. Corporations (LLC, INC, etc.) and Trusts (Revocable) do NOT need LEO signoff or fingerprints (still need ATF approval) however they may have tax implications. • An interesting and widely unknown fact, since the NFA went into effect in 1934, there has only been ONE, yes, ONE single felony committed in the whole United States since 1934 that involved a legally registered NFA firearm. And it was committed ironically by a crooked police officer who went to a drug house and shot someone on the premises. He used his legally acquired UZI sub machinegun to commit the crime. You hear all the time of machineguns and sawed off shotguns in the news but these have all been by individuals possessing an illegal, non registered weapon. There are millions of records of legally owned entries on the NFA registry too, so it’s not like we’re talking just a few hundred or thousand potential individuals. Six (6) distinct types of Class III NFA weapons• Machineguns – Often referred to as full-autos, automatics, etc… any firearm which fires more than 1 bullet for each individual pull of the trigger. • Short Barrelled Rifles (SBR) – Rifles with barrels less than 16″. • Short Barrelled Shotguns (SBS) – Shotguns with barrels less than 18”. • Silencers (Suppressors). Silencers/Suppressors are never portrayed accurately in the movies. If the bullet speed breaks the sound barrier, you WILL hear a pop. Suppressors are meant to alter the signature of a weapon so that it sounds like something else and/or the sound heard doesn’t mark the shooter’s position as easily as a non-suppressed weapon. .22 cal firearms can be suppressed very well though. You can make them so quiet that the action cycling produces more sound than the fired bullet does. With other calibers, sub sonic ammo can be used to lessen the signature as the bullet leaves the barrel. Best analogy I can give is a normal suppressed 5.56/223 from an AR15 will sound more like a .22 cal. rifle being fired. • Any Other Weapon (AOW) – these are usually things that don’t meet the other criteria above. Put a fore grip on a pistol, guess what? You JUST made an AOW weapon and if the proper paperwork and approval were not obtained prior, you have violated NFA regulations and possess a contraband weapon that carries severe fines and penalties. Other common AOW classifications are these wallet holsters you see that are meant to be/could be fired while the weapon is still in the holster. Pen guns are another example. AOWs are a little special in that the transfer tax for them is only $5.00. Ironically, the “maker” of the AOW still has to pay a $200 maker Form 1 fee just like he/she would to make a SBR, SBS or Silencer. • Destructive Devices (DDs) – these are self explanatory, but the ATF has classified several classes of shotguns now as destructive devices. The infamous ‘Street Sweeper’ shotgun is considered a DD by the ATF and falls into the title 2/NFA realm. ATF forms usually used in dealing with these weapons• ATF Form 1 – Maker Form – used by non manufactures to make NFA weapons – for civilians, only Short Barrel Rifles, Short Barrelled Shotguns, Silencers and AOWs can still be made (after May 1986). The ‘one time’ tax stamp for this form is $200. Maker will receive an approved form back from ATF and he/she can then make the item in question. Once made, if transfer of ownership is ever needed, this would be facilitated on a Form 4 below. • ATF Form 2 – Manufacturer Registration Form – used by manufacturers only. • ATF Form 3 – Dealer to Dealer tax-free form. Any SOT can transfer to any other SOT tax free NFA weapons he/she has in their possession/ownership. This is usually done when someone buys an item and it is transferred from a dealer in one state to a dealer in the buyer’s state to facilitate the approval/filing process. • ATF Form 4 – Tax paid to/from individual form – used when a NFA item is transferred TO or FROM an individual. Even if the individual transfers the said item to a SOT holder/dealer, there still is a $200 transfer tax. Once the SOT has it, they can transfer it back out to another SOT holder tax free (Form 3) or directly to another individual in their state on a tax paid (Form 4). • ATF Form 5 – Used to transfer NFA items to police departments for official use – tax fee transfer. Dealer use only. • ATF Form 5320 – Used in the Interstate Transportation of all Title II firearms. If you are traveling between states, you WILL need to fill this form out a few weeks in advance. NFA weapons must remain in the possession of the registered owner so short of just a few exceptions; you may not permit anyone to have possession of your weapon without you being in immediate presence. What is an SOT?An SOT is a taxpayer (entity) with an FFL that has registered with the federal government and paid an annual tax. The status as an SOT applies to the entity (business). This means that a business can get more than one FFL and it can rely on its status as the same SOT. The SOT tax must be paid every year by July 1st, and the cost of the FFL and SOT registration varies per FFL Type and, in some cases, by annual sales. Unfortunately, if you decide to become an SOT on June 1st, you’ll either need to pay again for the next year on July 1st or you’ll need to wait until July 1st to start the next SOT tax year. How to Become a Class 3 Dealer?This is what most people are wondering about when they ask “How do I become a Class 3 License?” The first step is to become a Federal Firearm Licensee. After you have your FFL, you’re ready to register as an SOT and pay the appropriate tax: Ensure that You Have the Correct FFL/Business StructureYou must ensure that you set your business up properly and got the correct type of FFL. If you took our course, don’t worry – you’re all set! If you want to be a dealer, you may use a Type 7 manufacturer’s license. The opposite isn’t true – a Type 1 dealer may not manufacture firearms. NFA firearms will be registered to the entity. We recommend using an actual business entity (a corporation or LLC) for liability purposes, but being a sole proprietor does have one benefit for some. If you decide to go out of business and give up your FFL, then all of the firearms, including NFA firearms (except post-1986 machine guns), can transfer freely (no transfer tax) to you as an individual. This is because the NFA firearms are registered to the SOT (the entity) and not the FFL license. Select Your Class of SOT and Tax-ratethe Class of SOT you must become depends on the activity you want to engage in. Once you’ve determined that Class of SOT you need to become, you must then figure out your tax rate. For some FFLs, the SOT tax rate changes depending on whether your total sales are over or under $500,000 annually. Take an Online SOT Registration CourseThe actual process of getting your FFL License and registering as an SOT can be difficult. However, thanks to online SOT certification courses, it’s never been easier. However, it’s incredibly important that you take the right one. When choosing an SOT Registration course, you should look to make sure that you are getting: legal advice from an actual firearms attorney that has the appropriate certifications: • legal advice from an actual firearms attorney that has the appropriate certification guidance from a true industry insider/professional who knows the ins-and-outs of both the firearms industry and the ATF • guidance from a true industry insider/professional who knows the ins-and-outs of both the firearms industry and the AT professional software that helps you track your progress automatically notifies you of any updates in the law and provides follow-on training and certifications for both you and your employees • professional software that helps you track your progress automatically notifies you of any updates in the law and provides follow-on training and certifications for both you and your employees Finally, Apply for and Register as an SOTUpon ensuring you have the correct FFL and business type, have chosen the right Class of SOT, and taken your course, you’re finally ready to apply for your SOT registration to become a Class 3 dealer, a Class 2 Manufacturer, or a Class 1 Importer. Now, the steps to this can be very difficult and may require multiple forms and extra steps depending on your situation. Title 2 Firearms Lawyer Free ConsultationWhen you need legal help with spcial occupations tax or firearms licensing in Utah, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/special-occupations-tax/ There are many different ways to raise money for your small business. What are Private Stock Offerings and How Can They Help You Finance Your Small Business?You can get loans from your friends and family, liquidate your savings, ask for donations online, or even throw a local fundraiser. But one the most powerful way to finance your small business is a private stock offering. A private stock offering—sometimes called a private placement—is when you sell securities in your business without an initial public offering—usually called an IPO. In other words, a private placement is when you sell your company’s stocks or bonds to private investors. For example, if you run a start-up shopping site, you might offer private stocks to a private investor. This investor gives you money to fund your burgeoning start-up in hopes that he or she will see a large financial return on their investment. There are numerous ways to find investors that might want to purchase securities in a private stock offering. Bankers, small business attorneys, and your personal business contacts are a good place to start. But it’s important to remember that not everyone qualifies as a private investor. While private offerings are governed by less strict rules than IPOs, the Securities and Exchange Commission (SEC) still has guidelines your business will need to follow. (Do note that you will not need to file anything with the SEC, however. In other words, a private placement allows you to get funding for your business without dealing directly with the SEC.) Who can invest in a private stock offering?Private placements must come from what the SEC terms an “accredited investor.” Our article, “What are Accredited Investors and How Can They Help Finance Your Small Business?” lays out a fuller picture, but know for starters that accredited investors are generally wealthy individuals or organizations. For example, for a single person to be classified as an accredited investor, they must have a net worth of $1 million or a yearly income of $200,000. Trusts, banks, investment and insurance companies also qualify. What documents you should have to hold a private stock offering?• Operating Agreement: First and foremost, you need to make sure your company is incorporated and that you have an Operating Agreement. Legal status and a plan that shows how your business runs will be crucial in securing the sort of savvy investors your small business will want. • Private Placement Memorandum: A Private Placement Memorandum outlines the terms and conditions upon which you are offering interests in your business. You can think of it as a brochure for your business, where you alert potential investors to the facts they’ll need to know about your company. You can set the amount of stocks you’re offering overall, the price for each, how many an investor can purchase, when that investor will receive stocks, and pertinent information about your company (such as its founders, age, projected profit, etc.). • Subscription Agreement: A Subscription Agreement is just that: an agreement. When a private investor decides to purchase securities in your small business, a subscription agreement is the contract you use to put the investment in writing. It should note the price and amount of stocks being purchased, in addition to information about the company itself. • Accredited Investor Questionnaire Form: An accredited investor questionnaire is used by companies and individuals to validate that they are in fact an accredited investor, as defined by the SEC. Making sure your investors are accredited investors can save you a lot of hassle down the road, when your business is growing even faster. Rocket Lawyer provides this form as part of our Subscription Agreement. While it might sound like a lot of paperwork, it’s not as bad as it seems. You’re simply showing potential investors how great your company is (via a Private Placement Memorandum) while they prove that they’re legally allowed to invest (via an accredited investor questionnaire form). When you agree, you both sign a contract (the Subscription Agreement) and you receive the funding you need to push your small business to the next level. Private Placement. What Is a Private Placement?A private placement is a sale of stock shares or bonds to pre-selected investors and institutions rather than on the open market. It is an alternative to an initial public offering (IPO) for a company seeking to raise capital for expansion. Investors invited to participate in private placement programs include wealthy individual investors, banks and other financial institutions, mutual funds, insurance companies, and pension funds. One advantage of a private placement is its relatively few regulatory requirements. Understanding Private PlacementThere are minimal regulatory requirements and standards for a private placement even though, like an IPO, it involves the sale of securities. The sale does not even have to be registered with the U.S. Securities and Exchange Commission (SEC). The company is not required to provide a prospectus to potential investors and detailed financial information may not be disclosed. The sale of stock on the public exchanges is regulated by the Securities Act of 1933, which was enacted after the market crash of 1929 to ensure that investors receive sufficient disclosure when they purchase securities. Regulation D of that act provides a registration exemption for private placement offerings. The same regulation allows an issuer to sell securities to a pre-selected group of investors that meet specified requirements. Instead of a prospectus, private placements are sold using a private placement memorandum (PPM) and cannot be broadly marketed to the general public. It specifies that only accredited investors may participate. These may include individuals or entities such as venture capital firms that qualify under the SEC’s terms. Advantages and Disadvantages of Private PlacementPrivate placements have become a common way for startups to raise financing, particularly those in the internet and financial technology sectors. They allow these companies to grow and develop while avoiding the full glare of public scrutiny that accompanies an IPO. Buyers of private placements demand higher returns than they can get on the open markets. A Speedier ProcessAbove all, a young company can remain a private entity, avoiding the many regulations and annual disclosure requirements that follow an IPO. The light regulation of private placements allows the company to avoid the time and expense of registering with the SEC. That means the process of underwriting is faster, and the company gets its funding sooner. If the issuer is selling a bond, it also avoids the time and expense of obtaining a credit rating from a bond agency. A private placement allows the issuer to sell a more complex security to accredited investors who understand the potential risks and rewards. A More Demanding BuyerThe buyer of a private placement bond issue expects a higher rate of interest than can be earned on a publicly-traded security. Because of the additional risk of not obtaining a credit rating, a private placement buyer may not buy a bond unless it is secured by specific collateral. A private placement stock investor may also demand a higher percentage of ownership in the business or a fixed dividend payment per share of stock. What is a Stock?Stock (also capital stock) of a corporation, is all of the shares into which ownership of the corporation is divided. In American English, the shares are collectively known as “stock”. A single share of the stock represents fractional ownership of the corporation in proportion to the total number of shares. This typically entitles the stockholder to that fraction of the company’s earnings, proceeds from liquidation of assets (after discharge of all senior claims such as secured and unsecured debt), or voting power, often dividing these up in proportion to the amount of money each stockholder has invested. Not all stock is necessarily equal, as certain classes of stock may be issued for example without voting rights, with enhanced voting rights, or with a certain priority to receive profits or liquidation proceeds before or after other classes of shareholders. Stock can be bought and sold privately or on stock exchanges, and such transactions are typically heavily regulated by governments to prevent fraud, protect investors, and benefit the larger economy. The stocks are deposited with the depositories in the electronic format also known as Demat account. As new shares are issued by a company, the ownership and rights of existing shareholders are diluted in return for cash to sustain or grow the business. Companies can also buy back stock, which often lets investors recoup the initial investment plus capital gains from subsequent rises in stock price. Stock options, issued by many companies as part of employee compensation, do not represent ownership, but represent the right to buy ownership at a future time at a specified price. This would represent a windfall to the employees if the option is exercised when the market price is higher than the promised price, since if they immediately sold the stock they would keep the difference (minus taxes). Shares vs. Stocks: What’s the Difference?The distinction between stocks and shares is pretty blurred in the financial markets. Generally, in American English, both words are used interchangeably to refer to financial equities, specifically, securities that denote ownership in a public company (in the good old days of paper transactions, these were called stock certificates). Nowadays, the difference between the two words has more to do with syntax and is derived from the context in which they are used. Of the two, “stocks” is the more general, generic term. It is often used to describe a slice of ownership of one or more companies. In contrast, in common parlance, “shares” has a more specific meaning: It often refers to the ownership of a particular company. StocksLet’s confine ourselves to equities and the equity markets. Investment professionals often use the word stocks as synonymous with companies—publicly-traded companies, of course. They might refer to energy stocks, value stocks, large- or small-cap stocks, food-sector stocks, blue-chip stocks, and so on. In each case, these categories don’t refer so much to the stocks themselves as to the corporations that issued them. Financial pros also refer to common stock and preferred stock, but, actually, these aren’t types of stock but types of shares. SharesA share is the single smallest denomination of a company’s stock. So if you’re divvying up stock and referring to specific characteristics, the proper word to use is shares. Technically speaking, shares represent units of stock. Common and preferred refer to different classes of stock. They carry different rights and privileges, and trade at different prices. Common shareholders are allowed to vote on company referenda and personnel, for example. Preferred shareholders do not possess voting rights, but on the other hand, they have priority in getting repaid if the company goes bankrupt. Both types of shares pay dividends, but those in the preferred class are guaranteed. Common and preferred are the two main forms of stock shares; however, it’s also possible for companies to customize different classes of stock to fit the needs of their investors. The different classes of shares, often designated simply as “A,” “B,” and so on, are given different voting rights. For example, one class of shares would be held by a select group who are given perhaps five votes per share, while a second class would be issued to the majority of investors who are given just one vote per share. Special ConsiderationsThe interchangeability of the terms stocks and shares applies mainly to American English. The two words still carry considerable distinctions in other languages. In India, for example, as per that country’s Companies Act of 2013, a share is the smallest unit into which the company’s capital is divided, representing the ownership of the shareholders in the company, and can be only partially paid up. A stock, on the other hand, is a collection of shares of a member, converted into a single fund, that is fully paid up. Free Initial Consultation with LawyerIt’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!
Ascent Law LLC
8833 S. Redwood Road, Suite C West Jordan, Utah 84088 United States Telephone: (801) 676-5506
Ascent Law LLC
4.9 stars – based on 67 reviews
Immigration Issues And Personal Injury Defense Ascent Law St. George Utah OfficeAscent Law Ogden Utah Officevia Michael Anderson https://www.ascentlawfirm.com/what-is-a-private-placement-of-stocks/ |
Probate LawyerProbate Lawyer in West Jordan Utah. If you need probate lawyer, trust attorney, inheritance counsel, living trust, last will and testament, call 801-676-5506 now for a free consultation. Archives
April 2023
Categories |