EB5 Investors Magazine Volume 2 Issue 2 | Page 39

The business lawyer’s big picture perspective As a broader, more general appellation than securities lawyer, the term business lawyer properly connotes an attorney whose focus is on a business as such: a broad-based enterprise whose activities will inevitably involve a variety of more narrowly-focused areas of the law, such as labor and employment law, landlord-tenant law, intellectual property law, contract law, transactional law, real estate law, and yes, securities laws. Unlike attorneys who specialize in one specific area, and develop narrow expertise in that one focus (including securities law), business lawyers develop broader-based expertise, including significant knowledge in many specific areas. So, while it is fair to say that securities lawyers are a sub-set of business lawyers, not all securities lawyers are business lawyers. Because of their breadth of knowledge, business lawyers are uniquely positioned to assist businesses (including, of course, EB-5 businesses) with the big picture: how all of the pieces of a particular business’s puzzle fit together to produce a successful enterprise. Seen in this light, a given EB-5 fundraising project is properly seen not as an end in itself, but instead as a means to achieve a broader goal—a very important means, to be sure, but still, just one step in the life of a business. A good business lawyer will caution clients swept up in that first blush of EB-5 possibilities (c’mon, you surely remember that first time) that it is not magic money. EB-5 funding is available money, and it is low-cost money, but it cannot magically transform a bad project into a good project; it simply cannot transform lead into gold. If a business does not make sense without EB-5 money, it cannot be made to work simply by including EB-5 money in the capital stack. That kind of perspective comes less readily to attorneys whose sole focus is narrower–on only disclosing information about a single fundraise. Instead, the business attorney looks past the immediate achievement of raising the money, to the results of spending the money. That lawyer will ask how raising the money will get the enterprise to its goals. Will the costs involved with financing, or restrictions on the ability to deploy those funds, or the obligation to repay the money by a specific date handicap the business’s growth? Or, can all those issues be taken in stride? With the perspective to see these issues, and the ability to frame the questions, the business lawyer enables answers to be discovered. sharing of profits and losses; and govern the departure and addition of participants. Many of those documents will be vital in objectively demonstrating compliance with the EB-5 program’s unique requirements. Based on my personal 30 years of practice, I understand how the business attorney can help negotiate, draft, or review the many agreements needed to enable the EB-5 transaction to actually take place.