Our Blog
WHAT IS A LETTER OF INTENT AND HOW IS IT DIFFERENT FROM AN ASSET PURCHASE AGREEMENT

WHAT IS A LETTER OF INTENT AND HOW IS IT DIFFERENT FROM AN ASSET PURCHASE AGREEMENT

Uncategorized
When purchasing a business in Texas, a letter of intent is a first step to putting some of the discussed terms in writing in order to move forward with the process. At this early phase, not all of the terms have been discussed or agreed. Potentially, the price is discussed but contingent on the results of due diligence to substantiate the value requested from the seller of the business. A LETTER OF INTEREST DOES NOT MEAN THE DEAL IS DONE. It is still very possible that the seller is shopping the business to other buyers, just as it is possible that the buyer is also considering other businesses. The LOI can include provisions for exclusivity, and depending on the parties this may be a negotiated term in order to proceed with…
Read More
BUYING A BUSINESS IN TEXAS

BUYING A BUSINESS IN TEXAS

Uncategorized
4 TIPS FOR BUYING AN EXISTING BUSINESS IN TEXAS Every deal is different, reach out to Tim Sutherland on the contact page if you are looking into purchasing a business and want to discuss the steps involved and the process. Working with a Texas business attorney can save you money in the future from headaches that can be avoided and ensure the deal goes as smoothly as possible. 1. HAVE THE SELLER AGREE TO EXCLUSIVITY WHILE NEGOTIATIONS ARE ONGOING If you are negotiating, you don’t want the seller shopping around. While initial negotiations are progressing, negotiate a window and have a signed agreement in place to allow time to make the right deal. You don’t want to be rushed or pressured with a hard sell and the seller claiming there is another…
Read More
ATTORNEY’S FEES PROVISIONS IN CONTRACTS

ATTORNEY’S FEES PROVISIONS IN CONTRACTS

Uncategorized
If you are reviewing or drafting a contract, one thing to consider is attorney’s fees. The general rule is that each side pays its own fees. For (oral or written) contract cases, a party may be able to recover its reasonable and necessary attorney’s fees. Texas has a statute which governs so long as a party prevails on the claims for breach and recovers damages (money). If the parties negotiate a written contract, they should take care to consider how attorney’s fees should be handled if there is a lawsuit if the deal goes south. THE PARTIES CAN DECIDE THE REQUIREMENTS FOR RECOVERY OF ATTORNEY’S FEES The parties to a contract can provide for either stricter or looser requirements for the recovery of fees. For example, maybe you don’t recover any money…
Read More
EVEN A SINGLE MEMBER LLC SHOULD HAVE AN OPERATING AGREEMENT

EVEN A SINGLE MEMBER LLC SHOULD HAVE AN OPERATING AGREEMENT

Uncategorized
When clients ask me whether they should go ahead and get an Operating Agreement, I always say ‘yes’ even when I am forming a single-member LLC. Before you go accusing me of an upsell or add-on, I have my own reasons and I will lay them out below. If you’d like to speak with me about your business and my thoughts on what kind of Operating Agreement is right for you, send me a quick email from the Contact Us page and we can set up a time to talk. First, let’s get a basic definition of an Operating Agreement.  It is essentially, at its most basic level, a contract signed between all of the members of the LLC agreeing how the company will be run, including management structure, member authority,…
Read More
AN ASSUMED NAME IN TEXAS IS NOT A TRADEMARK OR A BUSINESS ENTITY

AN ASSUMED NAME IN TEXAS IS NOT A TRADEMARK OR A BUSINESS ENTITY

Uncategorized
A TEXAS ASSUMED NAME GIVES THE PUBLIC A WAY TO FIND OUT WHO OWNS THE BUSINESS. An assumed name is a way to notify the public who they are doing business with when an individual or a company is doing business under a name other than the individual’s name or the entity name. The assumed name is likely more brandable than an entity name, especially in the situation of a sole proprietor. In the event someone needs to contact the true owner of a business, including for a lawsuit such as a personal injury or intellectual property issue, they can look up the owner who is using an assumed name. HOW TO FILE AN ASSUMED NAME. An assumed name is filed with the county clerk where you are doing business…
Read More
WHY YOU NEED TO TRADEMARK YOUR BUSINESS NAME

WHY YOU NEED TO TRADEMARK YOUR BUSINESS NAME

Uncategorized
WHY YOU NEED TO PROTECT YOUR BUSINESS WITH A TRADEMARK. People often associate the term trademark by way of naming examples of famous marks. These marks identify the source of the goods such as McDonalds (and their use of “Mc_____(everything)”. This means a couple of key things. First, the seller controls the reputation of the business so that another business which is named in a similar manner does not damage the reputation by providing goods or services of poor quality. Another key issue is to prevent another business from using your name to promote their business. Essentially, this is called trading off of your business or palming off goods in such a way that one business rides the coattails of another well known business and makes sales due to deception of…
Read More

QUESTIONS TO ASK WHEN BUYING A TEXAS BUSINESS

Uncategorized
WHY DID THE SELLER PUT THE BUSINESS ON THE MARKET? There can be many reasons a business owner wants to exit, such as: health; family; market or demand changing for the business; commonly the owner is worn out or in need of a change of scenery. If you know the reason, perhaps this can allow you room to negotiate the price. Does the owner need to get out from under the business asap? If so, this may help you acquire a business at a price well under market value. Does the owner desperately need funds for some reason (bills, another business, retirement, family, new purchase)? If so, perhaps this helps you negotiate a favorable all cash offer. IS THE SELLER SPEAKING TO MULTIPLE INTERESTED SERIOUS BUYERS? If the seller is…
Read More
WHY YOU SHOULD THINK TWICE ABOUT ARBITRATION CLAUSES

WHY YOU SHOULD THINK TWICE ABOUT ARBITRATION CLAUSES

Uncategorized
THINKING AHEAD AND INCLUDING AN ARBITRATION CLAUSE CAN REDUCE LEGAL FEES When you are putting the deal together and going back and forth on the terms, a dispute can seem like a far off concern and overly pessimistic. But, it is best to at least consider how you want to handle any issues that arise under the contract. Arbitration clauses are intended to direct ahead of time how contract disputes will be resolved.  Arbitration is a method of resolving disputes outside of the typical court system. The parties sign off on arbitration in the contract and based on the language in the arbitration clause, this will be the manner to handle any issues which would otherwise result in a lawsuit. Here are some of the issues to consider in weighing the…
Read More
HOW USING AN INTERNET FORM CONTRACT CAN GET YOU IN TROUBLE

HOW USING AN INTERNET FORM CONTRACT CAN GET YOU IN TROUBLE

Uncategorized
REASONS NOT TO USE A FREE CONTRACT FORM If you do a quick google search for a particular contract on the internet, you’ll find all kinds of forms you can view, or even download, to make use of for your business. The best part is these documents are free, and by taking the do-it-yourself approach you can skip your attorney and all the costs that come along with him. You are, after all, a wearer of many hats as a business owner so it is only natural you would take the initiative to be the legal department as well! But, despite the upside noted, there are quite a few issues that come along with using free internet forms instead of working with an attorney. 1. DID YOU EVEN PICK THE RIGHT FORM? You may think…
Read More
SUCCESSION PLANNING FOR YOUR TEXAS BUSINESS

SUCCESSION PLANNING FOR YOUR TEXAS BUSINESS

Uncategorized
Most Texas business owners and start-ups don’t think about a developing a business succession plan and strategy when they are choosing an entity and organizing the company. If you have invested time and money in starting your business, assuming you will live forever to operate your business is not a responsible business succession plan. It’s a plan doomed to fail. And with it, the business you’ve worked so hard to build. As with your customized business contracts and management documents, there is no cookie-cutter business succession plan that works for every business. Every business is different and needs a custom plan that takes into account your goals for the business. You need to written plan and agreement, and it’s a lot easier to do this before the crisis occurs. You…
Read More

REQUEST A CONSULTATION