How can I sell my business to an EB-5 investor?

Check with an EB-5 law firm that is experienced in handling EB-5 projects/deals such as this. They may already have a team that they can refer you to. However, here, your business may not qualify since it is already existing and you would have to show either a 40% expansion or that it&#39s a troubled business (which may be good for EB-5 purposes, but not so good if you&#39re trying to sell it to someone else). If it&#39s a buyout you&#39re seeking, perhaps it&#39s better to structure it through an L-1/EB-1C acquisition.

The buyer will need an experienced EB-5 lawyer. Keep in mind that no matter how many employees you have now, the new owner will have to hire 10 more new fill-time U.S. employees (unless the restaurant has been losing money). Will the restaurant support this many employees?

It is problematic to use an existing business as a vehicle for an EB-5 investment.

Your restaurant may not qualify an EB-5 investor for a green card unless it is a troubled business or through expansion rule, or an investor needs to create 10 new full-time positions (at least 35 hours a week). Talk to an experienced EB-5 immigration attorney.

The potential purchaser of your business who wishes to qualify the acquisition as a direct EB-5 investment must first determine whether or not it is located in a targeted employment area (TEA). Obviously, the investor wants to pay a fair market price, but he would have to pay a minimum of $1 million unless it is located in a TEA. Furthermore, he has to have a business plan to show that as a result of the investment over a two-plus year period of time he will create at least 10 full-time jobs for U.S. workers. You should retain an experienced immigration lawyer who can serve as a quarterback working the several professionals who are required for a transaction like this, including a corporate lawyer and an economist and business writer. You need to determine whether or not the project is located in a TEA to determine whether or not the minimum investment is $1 million versus $500,000.

You should contact an EB-5 immigration attorney with experience in EB-5 project structures to turn your business into an acceptable EB-5 project. When I work with clients like this, I assemble the team of professionals for all required documents and create the template for the foreign investor to file with USCIS.

You can certainly sell the business to an EB-5 investor and you should work through your attorney. However, the EB-5 investor buyer needs to do a lot of preparation with the purchase by seeking the help of an EB-5 attorney as well. This is primarily due to the fact that the buyer needs to ensure that the purchase must be organized so that it can be acceptable to the USCIS. Also, the EB-5 investor must run the business entity purposely to meet EB-5 requirements so that the buyer can obtain green card through the purchase. Apparently, the emerging business will be considered as a direct investment under EB-5 and the investor will have to make day-to-day management decisions of the business. All these legal and business issues require an assembly of professionals which may include attorneys, accountants, just to name a few.

Eligibility for the EB-5 program through the direct EB-5 route is a complicated process that requires professional help. Your business will need to create 10-plus new direct jobs attributable to the equity infusion by the EB-5 investor. You need to work with experienced immigration attorneys specializing in EB-5. You also need a business broker who is in touch with EB-5 investors who are looking to go the "direct" route. The equity infusion will most likely need to be $ 1 million. It is quite hard to get the TEA designation on direct investment EB-5 cases and be eligible for the reduced $500,000. I am assuming that your business was established after 1990 since you stated that it has been around for only eight years. This qualifies it as a new commercial enterprise, otherwise known as NCE. As for the documents you will need they include,e but most likely not limited to, the limited partnership agreement, business registration documents, escrow agreement and a business plan to be reviewed by USCIS.

The first step would be to make sure an EB-5 investor could get a green card by investing in your business. If it&#39s a troubled business, in that it has lost at least 20 percent of net worth in the past 12 or 24 months before filing, then you only have to show you saved 10 legitimate jobs. If it is not troubled, then the investment has to be part of a significant restructuring, increase net worth by 40 percent and create at least 10 additional new jobs to safely get an approval.

Your existing enterprise may not meet the requirement of a new commercial enterprise. However, your first step should be to consult with an investment immigration attorney to explain your goals and the immigration goals of your investor.

The only documents that may not be a part of a standard purchase/sale are employee documents - I9s, W2s, current payroll. The investor should engage an EB-5 immigration attorney to oversee the sale and ensure proper documentation (for EB-5 purposes) is obtained.

How is it going to create 10 new jobs? It does not seem likely this would qualify.

No different than selling to any other investor but to qualify for EB-5 the investor must not only pay $1 million-plus, but the business and investment must support 10 new jobs.