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Archive for for June, 2016

Is My Company’s Lawyer Also My Lawyer? (Part I)

June 30, 2016

In our previous blog on Meissner v. Yun, a New York case decided under Delaware law, we discussed the importance of a written LLC agreement (sometimes also referred to as member/operating/company agreement, depending on the jurisdiction) that spells out each member’s rights and obligations with specificity in the context of a break-up between two business partners.[1] In that case, the business partners did not have a signed operating agreement, which led to a dispute surrounding capital contributions and ownership.… Read the rest

Covenant Not To Compete When Buying or Selling a Business (Part II)

June 28, 2016

California: It All Comes Down to Goodwill.

Generally speaking, non-competes are void under California law.[1]  Exceptions do exist.  In the context of the sale of goodwill in a business, for example, the seller may agree not to compete with the buyer so long as the buyer carries on a like business.[2]  This makes sense because it would be unfair for the seller to engage in a competitive business that diminishes the value of the business sold.  So how does this work in practice?… Read the rest

Shawn McBride Talks About Crowdfunding on the Ambition Project Show

June 22, 2016

What the New Equity Crowdfunding Rules Mean for Dallas Business Owners and Investors.

On June 22, 2016, Shawn will be featured in a podcast interview with Deirdre Sanborn of the Ambition Projects Show.  In this interview, Shawn talks about what the new federal crowdfunding rules mean for small Dallas business owners and investors.

Click here to listen to the podcast.

For a detailed analysis of the federal law and related topics, please see our previous posts “Federal Crowdfunding—Finally Here—Goes into Effect on May 16, 2016,” “Crowdfunding: Is It Right for My Business,” “Is It Time To Do Crowdfunding To Raise Money?: SEC Releases Federal Crowdfunding Final Rules,” and “An Easy Way for Texas Companies To Raise Money?Read the rest

Shawn McBride Talks About Business Partnership in a Podcast Interview with My Time Is Now

June 21, 2016

What’s Love Got To Do with Business Partnerships and Business Laws.

On June 21, 2016, Shawn will be featured in a podcast interview with Charlene Gilman, a producer of a weekly podcast titled “My Time Is Now” that airs every Tuesday with a worldwide audience covering United States, South Africa, and Australia.  In this interview, Shawn talks about how business partnerships can quickly go sideways when business laws are ignored during business changes and shares some tips on keeping business partnerships healthy and successful. … Read the rest

Covenant Not To Compete When Buying or Selling a Business (Part I)

June 16, 2016

If your business employs skilled workers, or you have been one, you may be familiar with non-compete agreement, also known as covenant not to compete.  For those who are less familiar with the subject, it is a contractual provision under which one party agrees not to compete in the same business, usually for a specific time period and/or in a defined geographic area.  For example, in the context of employment, an employee may sign an employment agreement and agree not to work for a competitor of the employer for, say, three years after termination of the employment. … Read the rest

Federal Crowdfunding Goes into Effect on May 16, 2016 (Part VI)

June 14, 2016

Fix Crowdfunding Act.  

We have been blogging about federal crowdfunding in this blog series this past month or so. As you know, Title III of the JOBS Act, also referred to as the “CROWDFUND Act (Capital Raising Online While Deterring Fraud and Unethical Non-Disclosure Act of 2012),” exempts up to $1 million crowdfunded securities from the federal registration requirement when the transaction is conducted in certain ways.[1] For a detailed analysis of the final rules, please see our previous blog series “Is It Time To Do Crowdfunding To Raise Money?: SEC Releases Federal Crowdfunding Final Rules.” Even before the final rules went into effect, however, efforts to amend Title III had been underway.… Read the rest

Can a Partner Be Held Liable for a Partnership Debt in Texas? (Part III)

June 9, 2016

In our previous post, Can a Partner Be Held Liable for a Partnership Debt in Texas?, we discussed the Texas Supreme Court’s holding in American Star Energy and Minerals Corporation v. Stowers[1] that a creditor cannot sue individual partners to satisfy a partnership debt until a judgment is passed against the partnership and goes unsatisfied for 90 days.  There is another part of the story.  The partners argued that the court’s holding imposed “automatic” liability– basically claiming that the court undermined their due process rights on grounds that they should have been named and served in the lawsuit against the partnership so that they would be on notice of their potential liability and have an opportunity to contest it.… Read the rest

Federal Crowdfunding Goes into Effect on May 16, 2016 (Part V)

June 7, 2016

SEC Small Entity Compliance Guide and Compliance and Disclosure Interpretations for Issuers.

On May 13, 2016, the Securities and Exchange Commission (“SEC”) released two guidance documents on crowdfunding for issuers: “Regulation Crowdfunding: A Small Entity Compliance Guide for Issuers” and “Regulation Crowdfunding: Compliance and Disclosure Interpretations (C&DIs).” [1]  For details of the final rules, including requirements for issuers, please see our previous blog series “Is It Time To Do Crowdfunding To Raise Money?: SEC Releases Federal Crowdfunding Final Rules.” The compliance guide and C&DIs explain the final rules in plain English, some of which we highlight below.… Read the rest

All postings are intended to be planning tools to familiarize readers with some of the high-level issues discussed therein. No posting is intended to be a comprehensive discussion and additional details should be discussed with your transaction planners including attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances. This article should not be treated as legal advice to any person or entity.