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November 1, 2012Thomas Horton

Partnership Law – Does a Partner’s Desire to Terminate the Partnership at a Later Date Constitute Dissolution?

Buck v. Palmer, 381 S.W.3d 525 (Tex. 2012)

November 12, 202314071200

Fiduciary Duties, Exculpation, and Indemnification in Texas Business Organizations

This article discusses fiduciary duties, some history regarding fiduciary duties in Texas, and fiduciary duties with respect to LLCs.

May 19, 2017John C. Ale, Hillary H. Holmes, Brad L. Whitlock

Considerations in Drafting Limited Liability Company Agreements and Limited Partnership Agreements

Given their structural flexibility and tax advantages, it is little wonder that limited liability companies (“LLCs”) and limited partnerships (“LPs”) have eclipsed the corporation as the primary entities of choice for new businesses in Texas. LLCs and LPs offer a myriad of almost limitless options on ownership structure, company governance and almost all other aspects related to the operation of the entity. However, as it is often said, with much freedom comes much responsibility. A practitioner who puts together a limited liability company (“LLC agreement”) or an agreement of limited partnership (“LP agreement”) for a client should be well versed in the overall structure of these entities and the variables that should be considered in drafting the operative agreement. Both LLCs and LPs are so-called “creatures of contract” in that the Texas Business Organizations Code (“TBOC”) chapters on LLCs and LPs give great deference to the LLC agreement or LP agreement to define the rights and obligations of the members and partners, respectively, of these entities. This paper analyzes select provisions of the LLC agreements and LP agreements that practitioners are likely to have to address in drafting an agreement for a client.

May 19, 2017William H. Hornberger, Frank Z. Ruttenberg, Bradley Lee Whitlock

Drafting Sensitive Issues in Company Agreements

NOTE: Limited Liability Company Agreements are highly customizable offering its Members great flexibility to agree to provisions for the economic terms and governance. This Example of a Company Agreement should not be considered a form. When drafting a Company Agreement, the drafter should draft provisions which are appropriate for the particular transaction. NOTE: Limited Liability Company Agreements often include provisions which address particular issues under the Federal tax laws and State tax laws. This Example of a Company Agreement does not include provisions designed to address Federal or State tax issues. When drafting a Company Agreement, please consult or have your client consult with appropriate tax advisors for the purpose of addressing any Federal or State tax issues that may arise from the investment or may impact the drafting of the Company Agreement.

November 8, 2013F. Eric Fryar, Christina Richardson, Caitlin B. Feste, Rusty Sewell

Shareholder Oppression: Is It a Cause of Action?

In troubled economic times, the temptation to exercise power over business partners can be overwhelming—whether borne out of greed, a sense of entitlement, or even a perceived need for self-preservation. This article deals with the rights of individual shareholders in closely held corporations. This is an area that is poorly developed in Texas law and plagued with apparent contradictions in the dicta. The most common case arising out of the abuse of corporate powers has to do with officers or directors using their power to steal from the corporation (and thus from the shareholders as a group). Shareholders often bring these cases, and a very common result is the dismissal of the lawsuit because the duties violated are owed to the corporation and not to the shareholders individually. Several Texas cases seem to suggest that there are no (or at least very few) duties owed to shareholders individually. In recent years, individual shareholders have been prevailing in lawsuits asserting claims for shareholder oppression—claims based on duties owed to the shareholders individually. In this article, we will explore the basis of these claims. We will not deal with the closely related issue of derivative suits or with duties owed by officers and directors to corporations.