There are many ways that an owner of a closely-held business can use their superior financial resources to gain an advantage over their co-owners in a dispute. One common way is the use of a capital call provision to dilute the interest of minority owners or to create off-setting claims against them. “Weaponizing” capital call
Edward S. Robson
OWNERSHIP DISPUTE – PAY ATTENTION TO SCHEDULE K-1
By Edward S. Robson on
In a perfect world, groups of potential business partners would sit down before they started their new ventures to hash out the details of their relationship. They would work in close consultation with one or more attorneys to produce detailed subscription, operating and loan agreements documenting their arrangements and clearly delineating responsibilities. In the real…
MAKE BUSINESS DIVORCE EASIER—SPELL OUT THOSE DUTIES IN YOUR OPERATING AGREEMENT
By Edward S. Robson on
Posted in Operating Agreement, Ownership Disputes
Closely held companies are like marriages but without the sex or kids to hold things together. And just like some marriages, closely held companies can fall apart. Sometimes these “business divorces” and the painful litigation they generate are inevitable. Business partners have different personalities, expectations regarding finances and strategies for interacting with the world and
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