Small business owners who form a corporation often create shareholders’ agreements to govern their relationships, protect minority investors, and establish protocols for share transfers. These agreements are particularly common in family businesses or closely-held corporations with just a few shareholders. But what happens when these agreements don’t specify how long they remain in effect? In…
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Commercial Lease Terms for Recovering Attorney’s Fees
Commercial landlords and tenants routinely negotiate detailed lease agreements with provisions designed to protect their interests in case of disputes. These agreements are intended to help avoid litigation. But when litigation arises and business owners have to hire attorneys, they usually want to know who pays the attorney’s fees? While Texas generally follows the “American…
When Do Online Business Reviews Cross the Line into Defamation?
Business owners today operate in a world where online reviews can significantly impact their reputation and bottom line. A single negative review can reach thousands of potential customers within hours. But when does a negative review cross the line from protected consumer speech into actionable defamation? What specific statements in a review might expose customers…
When Can Courts Declare Someone a Vexatious Litigant? Texas Law Sets the Bar
Have you ever dealt with someone who seems to file lawsuits as a hobby? Perhaps you’ve heard stories about individuals who repeatedly sue businesses despite consistently losing their cases. For businesses facing such situations, defending against multiple meritless lawsuits can be financially draining and time-consuming. Fortunately, Texas law provides a mechanism to address this problem…
Choosing Between a Corporation and an LLC for Your Business
Starting a business is a big step, and choosing the right business structure is a critical component of that process. Deciding between a corporation and a limited liability company (LLC) can be a difficult task, as both have their own unique advantages and disadvantages. In this article, we’ll explore the key differences between corporations and…
Sole Proprietorship vs LLC: Which is Right for Your Business?
Starting a business is a big decision, and choosing the right business entity is a critical step in that process. Two of the most common business structures are sole proprietorships and limited liability companies (LLCs). There are a number of pros and cons associated with each type. This article will help you understand the differences…
The Interplay of Buy-Sell & Non-Compete Terms
The intent of drafting business agreements is often to avoid disputes. One cannot always anticipate every type of dispute that can arise. This is where experience comes in, as some disputes are recurring and can be avoided. A buy-sell agreement that is not coordinated with the terms of a non-compete agreement is an example. This…
When to Issue Preferred Shares
Preferred shares are a type of equity security that represents ownership in a company. Businesses can use preferred shares to raise capital by issuing them to investors in exchange for money. The investors become shareholders in the company and are entitled to fixed dividend payments and potential appreciation in the value of their shares. By…
Why You Should Always Hire a Texas Registered Agent
Business is hard. There are a lot of tasks and details that one has to attend to for the business to thrive and be successful. The business owner cannot do everything. Some tasks and details will be missed. Business owners often have to triage their tasks, doing only what is necessary to get through the…
Texas LLC Members Personal Liability (Explained)
If you are a member of a Texas limited liability company (LLC), it is important to understand that LLCs provide a level of liability protection to their members. This means that, in most cases, a member of an LLC cannot be held personally liable for the debts and obligations of the LLC. This principle was…