What legal steps can I take to protect myself in a business in that I am investing in?
Question Details:
I am about to invest $11,400 into an established business so they can purchase new supplies for expansion. The business has guaranteed 10% of investment to be paid monthly for 12 months then the 11,400 is returned to me. He created a "revenue share agreement form" that we will both sign. Are there any other steps that if he is a con artist I can take to ensure a victory in court if he defaults on his promise?
Business Law Answers
Don't invest. NO business can guarantee a 10% per month, or 120% per year(!), return. I used to be an SEC attorney--promises like this were always part of scams. (Unless I'm misunderstanding you--the way you wrote the above, you get an amount equal to 10% of the investment per month for 12 months, THEN you get the principal back, which implies that your will receive a total of around $25k ($11.4k return of principal, $14k in monthly payments--call them interest).
This level of return is simply not credible.
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