The Importance of Ownership Agreements
Three individuals formed a business entity through which they were going to launch a promising new software application. They had done everything right – they engaged an attorney to handle the formation and had divided up operating responsibilities according to each person’s strengths. The idea was relevant, the technology was functionally strong, and the angel investors were interested – all was looking good. Then, two of the founders learned that the third had been behaving improperly and perhaps illegally – they wanted that person out . . . out of everything . . . out of operations, out of any officer position, off the board . . . and, “we want the equity back because this person should not be able to retain ownership after breaching contracts and duties.” All reasonable reactions considering they got into this as a team and expected the team would stick together and succeed intact.
Things change, life happens. Don't skip out on the details; learn how engaging an attorney can help your business. Read more about ensuring your Ownership Agreements work for you.
In addition to Thriving Attorney, Darin M. Klemchuk is founder of Klemchuk LLP, a litigation, intellectual property, and transactional law firm located in Dallas, Texas. He also co-founded Project K, a charity devoted to changing the world one random act of kindness at a time. Click to read more about Darin Klemchuk's practice as an intellectual property lawyer.