I pray you have been doing well, more blessings to you, your colleagues and your entire family, IJN.
I need your professional and competent advice. I have received various kinds of advice on this issue I want to discuss with you but I know you know best.
So, I registered my business as a business name in 2009, and my business has grown small locally but I need to expand my business to Ghana and Benin Republic so I can blow and I need plenty money for that.
My brother-in-law wants to give me plenty money for this. He says he will invest in my business, but his lawyer told him it was not possible, because my business is a business name, not a limited liability company. The lawyer (that wants to truncate my greatness) said that I need to incorporate a company before my brother-in-law can invest. If I don’t get this money, my business will end and I can just die so I want to know if there is any way I can convert my business name to a company incorporation.
Please advise me on this issue because my whole life depends on it.
Blessings to you, Zainab
Dude, Stop being melodramatic!
Even in my wildest estimation of my relevance and powers, I doubt my advice can determine whether you live or die.
Your brother-in-law’s (BIL) lawyer is kind of right. Although you can enter into a profit-sharing agreement that determines what your BIL will get in return for his investment, if you remain a business name, not becoming to a company limits the type of investors you can get. You probably won’t have anyone apart from FFF (friends, family & fools) invest and some FFF may even refuse to invest in a business name like is happening now.
So, you’re on the right track by deciding to change your business to a limited liability company.
Whilst there are legal provisions allowing a business name to be converted to a limited liability company, the process for changing from a business name to a company is risky as it requires first, filing for cessation of the business name before applying to convert that business name (which has ceased operating) into a new company.
Between cessation of the business name and incorporating a company, there is a chance you may lose your existing name, among other operational issues that may arise. So, what I typically advise is incorporate a company with the same (or similar) name as your existing business name, after which you can then apply for cessation of the business name. For instance, if “ABC Ventures” is the name of the Business Name, apply to incorporate a company known as “ABC Software Solutions Limited” or “ABC Prints and Paper Limited” as the CAC may not approve “ABC Ventures Limited” or “ABC Limited” because of the existence of “ABC Ventures”
When you are done incorporating ABC Software Solutions Limited or ABC Prints and Paper Limited, move your business that that then proceed with formally applying for a cessation of business for ABC Ventures.
All the best with your expansion plans, Drama-King,