How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask David L Your Own Question
David L
David L, Attorney
Category: Business Law
Satisfied Customers: 3255
Experience:  Corporate and Business lawyer since 1997
Type Your Business Law Question Here...
David L is online now
A new question is answered every 9 seconds

If I am designing and manufacturing a product, can I sell a

Customer Question

If I am designing and manufacturing a product, can I sell a portion of the future profit I will make from it in exchange for an investment now to finish off the production build?
Submitted: 5 years ago.
Category: Business Law
Expert:  David L replied 5 years ago.
Hello. Sure you can. You can offer a profits interest in your company. A profit interest gives the investor a right to a percentage of the profits as they are earned. The easiest way to do this is to form a corporation or LLC, draft a shareholder agreement or operating agreement and have these terms within the agreement. You can then offer shares of the company that carry a profit interest right.
David L and 2 other Business Law Specialists are ready to help you
Customer: replied 5 years ago.
I need a clarification... What if I want to design and sell multiple products, I will have multiple investors for each product, I want one company, each product will have a separate P&L or be its own division, and investors in each product depending on their investment will get their share of the profit with each order completed. Is this legal?
Expert:  David L replied 5 years ago.
It's legal. You have to come up with a way to structure separate investments. If you use my idea above where you are selling shares or membership interests, you might form one top-level holding company and then subsidiaries with separate corporate entities and separate stock shares. That might be one way to keep things separate enough to offer separate investments.

Related Business Law Questions