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Minority Owned Businesses
In September 2008, MGT of America, Inc. (MGT), was retained to conduct a minority and nonminority woman-owned businesses enterprise (M/WBE) disparity study for the State of Texas (Study). to determine whether there was a compelling interest to continue a narrowly-tailored Historically Underutilized Business (HUB) program, as required by the U.S. Supreme Court decision in Richmond V. Croson, 488 U.S. (1989) The results of this study and the conclusions drawn are presented in detail in Chapters 2.0 through 8.0 of this report. A complete discussion of findings and recommendations is contained in Chapter 9.0. The following sections briefly summarize each of the study's findings, and are followed by related major communications (Chapter 9.0). Selected best practices are described in Chapter 10.0 of this report.
Ten Legal and Other Putfalls for the Technology Start Up
In this paper, I have attempted to summarize some of the major issues and/or pitfalls that might befall a founding entrepreneur in the formation of a new enterprise. Of course, not all start ups are alike, nor is there a “checklist” that guarantees success, but the following are examples of some common themes that I have encountered over the past 15 years in working with emerging growth companies. These are not listed in any particular order of importance or significance— rather, they are meant to give an entrepreneur a framework to analyze the legal and other issues that arise in forming a new company.
Issues in Early Recapitalization
Shareholder Agreements, Buy/Sell Agreements and Voting Trusts
This outline analyzes the use of shareholder agreements and voting trusts in connection with a startup or venture capital funded company. Shareholder agreements and voting trusts are contractual control mechanisms that are designed to address various issues, including: (i) restrictions on the transfer of equity ownership, (ii) rights of first refusal and (iii) buy-sell provisions.
Initial Startup Considerations
Getting Your Client Ready to Sell
Selling a business is not for the faint at heart. Most sophisticated buyers will leave no stone unturned in examining a potential purchase target. This is particularly true for publicly traded companies, which have expanded due diligence duties imposed on them by the Sarbanes-Oxley Act of 2002. To make matters worse, most companies are not operated with a view toward being acquired. This combination can often make for an arduous, and sometimes contentious, review process. Troublesome issues ranging from the identity of the business owner to the conduct of day-to-day operations can, if not properly addressed, cause a transaction to fail. The wise attorney will anticipate these issues and will advise his or her client on what to expect throughout the process.
Fiduciary Duties, Exculpation, and Indemnification in Texas Business Organizations
Statutory developments beginning in the 1990's have impacted the analysis of fiduciary duties in the business organizations context. The duties of general partners are now defined by statutory provisions that delineate the duties without referring to them as “fiduciary” duties and specifically provide that partners shall not be held to the standard of a trustee. Whether limited partners in a limited partnership have fiduciary duties is not wellsettled, but the new Business Organizations Code (“BOC”) clarifies that a limited partner does not owe the duties of a general partner solely by reason of being a limited partner. While the fiduciary duties of directors are still principally defined by common law, various provisions of the corporate statutes are relevant to the application of fiduciary duty concepts in the corporate context. Because limited liability companies (LLCs) are a relatively recent phenomenon and the Texas LLC statutes do not specify duties of managers and members, there is some uncertainty with regard to the duties in this area, but the LLC statutes allude to or imply the existence of duties, and managers in a manager-managed LLC and members in a member-managed LLC should expect to be held to fiduciary duties similar to the duties of corporate directors or general partners. In each type of entity, the governing documents may vary (at least to some extent) the duties and liabilities of managerial or governing persons. The power to define duties, eliminate liability, and provide for indemnification is addressed somewhat differently in the statutes governing the various forms of business entities.
Issues in Early Recapitalization
Minority Owned Businesses
In September 2008, MGT of America, Inc. (MGT), was retained to conduct a minority and nonminority woman-owned businesses enterprise (M/WBE) disparity study for the State of Texas (Study). to determine whether there was a compelling interest to continue a narrowly-tailored Historically Underutilized Business (HUB) program, as required by the U.S. Supreme Court decision in Richmond V. Croson, 488 U.S. (1989) The results of this study and the conclusions drawn are presented in detail in Chapters 2.0 through 8.0 of this report. A complete discussion of findings and recommendations is contained in Chapter 9.0. The following sections briefly summarize each of the study's findings, and are followed by related major communications (Chapter 9.0). Selected best practices are described in Chapter 10.0 of this report.
Conflicts, Contracts, and Costs: A Quick Ethics Update on Critical Law Practice Considerations
This presentation is intended to remind lawyers of their duties in three critical areas that affect a great majority of practicing attorneys. Those areas are: 1. A short reminder of our responsibility to analyze the rules regarding conflicts of interest and either avoid or resolve conflicts as they arise; 2. A reminder how lawyers can be protected by appropriately documenting files, including a solid attorney-client contract, outlining the expectations of both the attorney and the client throughout the representation, as well as closing letters; and 3. Keeping your law offices running smoothly and efficiently by choosing the right equipment and procedures for serving clients, maximizing your talents, and protecting yourself.
Essentials of Business Law, Review of Entity Formation and Governing Documents
The primary purpose of this outline is to address several of the more material formation issues the legal advisor many encounter in connection with the formation of a business entity in the State of Texas, and consider some of the options available to the client to address these issues.
Privacy and Data Security Law in Texas, An Overview
The import of this article is, hopefully, to make Texas attorneys aware of just how broad the considerations of privacy and data security can be. As the field grows, lawyers in Texas will inevitably have to take privacy and data security issues into account in many varied business issues, in terms of compliance, transactions, and enforcement of rights. It also seems clear that the federal actions to date indicate that there will not be an over-arching action by the U.S. Congress to address privacy matters to the exclusion of state regulation, or if such an action is taken, that it will only create a floor for minimum protections, and states will continue to be able to regulate as long as it is in a manner that is not contrary to the federal scheme. Consequently, Texas lawyers should anticipate a continuing growth in privacy law and regulation in Texas, as well as an increase in privacy claims being asserted in Texas courts. The transactional lawyer in Texas will have to be aware of, and provide allocations for, these risks in the contracts and other legal documents he or she drafts and negotiates for clients.
Initial Startup Considerations
Getting Your Client Ready to Sell
Selling a business is not for the faint at heart. Most sophisticated buyers will leave no stone unturned in examining a potential purchase target. This is particularly true for publicly traded companies, which have expanded due diligence duties imposed on them by the Sarbanes-Oxley Act of 2002. To make matters worse, most companies are not operated with a view toward being acquired. This combination can often make for an arduous, and sometimes contentious, review process. Troublesome issues ranging from the identity of the business owner to the conduct of day-to-day operations can, if not properly addressed, cause a transaction to fail. The wise attorney will anticipate these issues and will advise his or her client on what to expect throughout the process.