Financing Issues in Creating a New Corporation

Capital Structure-Debt vs. EquityGenerally speaking, corporations raise capital through debt or equity or a combination of both. Equity investments—the purchase of shares issued by the corporation—involve...

Forming a Corporation

Choosing the Business EntityThe selection of a type of business ownership is a decision that a person should make, in consultation with an attorney and an...

Stock in a Corporation

What is stock in a corporation?Capital StockThe defining characteristic of a corporate legal structure is that its ownership is in the form of stock. The “capital...

Proving Compliance with Fiduciary Duties in a Stock Redemption

Elsewhere on this website and blog post, we have argued that majority shareholders and corporations owe fiduciary duties to minority shareholders in the context of a...

Retrospective on Texas Corporate Law

Corporations are so ubiquitous that it is surprising that they are a relatively recent legal development. Here is a history of the development of the Texas...

Share Certificates

Ownership interests in a for-profit corporation must be evidenced by a share certificate, unless otherwise provided by the governing documents of the corporation or by resolution...

Nature of the Corporation

What is a corporation? How is it different from a partnership? What are the legal obligations?Attributes of the corporate entityThe corporate structure allows the owners of...

Property Rights and Privileges of Share Ownership

Texas law recognizes “the property right which a share in such a company creates.” Yeaman v. Galveston City Co., 167 S.W. 710, 719 (Tex. 1914). In...

Pre-Incorporation Issues

PromotersThe role of the “promoter” is a bit of an anachronism under the Business Organizations Code. Dean Hildebrand defined a promoter as “one who brings together...

Majority Shareholders May Not Maliciously Time a Transaction

In prior blog posts, we have dealt with the issue of shareholder oppression that ends in a stock redemption. While generally majority shareholders do not owe...