As private companies grow, they need to secure capital to support their efforts to provide more (and/or better) products and services to their clients. The need for emerging companies to obtain growth capital often leads the...more
7/24/2025
/ Business Development ,
Business Divorce ,
Business Ownership ,
Contract Terms ,
Corporate Governance ,
Due Diligence ,
Financial Services Industry ,
Investment ,
Private Equity ,
Private Equity Firms ,
Private Equity Funds ,
Risk Management ,
Shareholders
When a married couple enters into a divorce proceeding, they generally expect to end things in a final decree that fully divides all of their marital assets. But when they fully own or have a large interest in a closely held,...more
7/9/2025
/ Business Divorce ,
Business Litigation ,
Business Ownership ,
Buy-Sell Agreements ,
Contract Terms ,
Corporate Governance ,
Dispute Resolution ,
Divorce ,
Executive Compensation ,
Marital Assets ,
Partnerships ,
Spouses
One of the thorniest issues private company owners and minority investors may be required to confront in going through a business divorce is determining the value of the minority interest being purchased. It is not unusual...more
6/16/2025
/ Arbitration ,
Business Divorce ,
Business Valuations ,
Buy-Sell Agreements ,
Contract Disputes ,
Dispute Resolution ,
Investors ,
Majority Shareholders ,
Minority Shareholders ,
Ownership Interest ,
Private Company Shares ,
Valuation
Business divorces often involve turbulence as business partners go through this process. But partners who plan ahead can navigate through their business divorce to avoid capsizing the company or frustrating their personal...more
When longtime business partners in private companies go through a business divorce, emotions often run high. One or both of the partners may be seeking a “revenge premium” in the business divorce process based on their...more
4/1/2025
/ Arbitration ,
Business Divorce ,
Business Litigation ,
Business Operations ,
Business Strategies ,
Buy-Sell Agreements ,
Dispute Resolution ,
Majority Shareholders ,
Mediation ,
Minority Shareholders ,
Valuation
Throwing the baby out with the bath water is a pithy expression that suggests exercising caution when business partners in private companies are seeking to achieve a business divorce. The majority owner and the departing...more
3/19/2025
/ Arbitration ,
Asset Purchase Agreements ,
Business Disputes ,
Business Divorce ,
Buyouts ,
Dispute Resolution ,
Exit Planning ,
Exit Strategies ,
Investors ,
Majority Shareholders ,
Minority Equity Investments ,
Minority Shareholders ,
Minority-Owned Businesses ,
Shareholders ,
Valuation
Success is not just an elusive goal – it can also be difficult to maintain once achieved. For majority owners in private companies, achieving success is just the first hurdle, because once they arrive at this pinnacle, they...more
3/3/2025
/ Business Divorce ,
Buy-Sell Agreements ,
Corporate Governance ,
Employee Benefits ,
Employee Incentive Plans ,
Employees ,
Equity ,
Executive Compensation ,
Fiduciary Duty ,
Incentive Compensation ,
Limited Liability Company (LLC) ,
Private Equity ,
Shareholders
During Valentine’s Day month, we are taking a look at 50-50 owned private businesses. Forming a co-owned company may sound like a good idea on paper because the two partners are close friends or family members who are making...more
2/12/2025
/ Arbitration ,
Business Divorce ,
Business Ownership ,
Buy-Sell Agreements ,
Contract Negotiations ,
Contract Terms ,
Corporate Deadlock ,
Corporate Governance ,
Dispute Resolution ,
Limited Liability Company (LLC) ,
Mediation ,
Ownership Interest ,
Partnerships
In recent years, the headlines have tracked the news of high-profile breakups among business partners in private companies. These business partner fallouts include:
- 2023: Sam Altman was ousted as Open AI CEO (for...more
1/14/2025
/ Business Disputes ,
Business Divorce ,
Business Entities ,
Business Partners ,
Conflict Resolution ,
Contract Terms ,
Corporate Governance ,
Exit Strategies ,
Fiduciary Duty ,
Investors ,
Partnerships ,
Prenuptial Agreements ,
Shareholders
Majority owners of private companies are empowered to exercise control over their businesses, but if they disregard the valid concerns of their minority partners, they may sow the seeds for a divisive business divorce in the...more
Money talks when the majority owners of private companies add new business partners who contribute additional capital. When these investors are high-powered PE firms or high-profile companies, with large balance sheets and...more
11/6/2024
/ Business Divorce ,
Business Ownership ,
Business Partners ,
Buy-Sell Agreements ,
Due Diligence ,
Investors ,
Majority Shareholders ,
Minority Shareholders ,
Portfolio Companies ,
Prenuptial Agreements ,
Private Company Shares ,
Private Equity Firms ,
Repurchase Options ,
Right of Redemption
Business divorces take place in all types of private companies, including those owned and operated by family members. But families that are willing to engage in thoughtful planning can head off some of the internal conflicts...more
Entrepreneurs are incredibly devoted to the success of their business, but even a thriving company may be severely impacted by a high conflict marital divorce. When a couple decides to part ways, the ripple effects can extend...more
Fast-growing private companies are exciting to observe as outsiders, but on the inside the company founder has the challenge of securing enough capital to fuel the rapid growth of the business. The company’s continuous need...more
Conflicts between co-owners in private companies are common, but the vast majority are worked out through dialogue and negotiation. When these internal conflicts cannot be resolved, however, minority investors may file suit...more
When divorcing couples hold ownership interests in private companies as part of their marital estate, they will have to address a number of business issues related to these interests in their divorce settlement. Planning...more
Hindsight can be a wonderful thing, especially if hard-earned lessons are adopted by others who are willing to learn from past mistakes. When private company owners and investors share with me some of the wisdom they have...more
As a business trial lawyer representing private company owners and investors in business divorce disputes and civil litigation for many years, my experience teaches that business partners should approach litigation with...more
After devoting long hours and years of hard work in building their companies, majority owners of private businesses may reach a point where they consider whether it is time for them to sell. This large question – Is now the...more
Private company owners strive for success but getting there is not an easy or straight path. I have been working closely with business owners now for more than 40 years, and I have been reflecting on the key character traits...more
Family members who enter into a private business together are taking on double risk. They face the same types of challenges that all owners and investors face in operating/investing in a business, but they are also exposed to...more
The one who has the gold often makes all the rules, but the majority owner of a private company who has minority partners in the business does not have complete freedom, because majority owners owe duties that apply to their...more
11/21/2023
/ Business Divorce ,
Business Litigation ,
Business Ownership ,
Confidential Information ,
Corporate Governance ,
Disclosure Requirements ,
Documentation ,
Fiduciary Duty ,
Financial Statements ,
Majority Shareholders ,
Minority Shareholders ,
Private Company Shares ,
State and Local Government ,
Texas
Marital divorces are often difficult under the best of circumstances, but tensions may be even higher when the marital estate includes substantial interests the married couple own jointly in private companies, which they are...more
We accept that beauty is in eye of the beholder but determining what a private company is worth should be much more objective. Yet, for a business owner who is considering a sale of the company, it may come as a surprise that...more
It may be a reflection of summer’s lazy days or a simmering frustration that has built up over time, but it is not uncommon for a majority owner or a minority investor in a private company to decide the time has come to...more