Legal Question in Business Law in Texas
I have a legal binding contract with a company which states , I will receive 1% of the net profit yearly. Is it legal for a company to pay their incom tax out of the co. gross money at the end of each year, ? Is it also legal to move the money from one branch of the co. to another part of the co.? Is it legal to purchase other properties during the year , by doing the things it reduces my net profit . Please reply.
1 Answer from Attorneys
As a franchise attorney I can say it is not possible to answer your questions without seeing the "legal binding contract" you signed. If it contains a "sloppy" definition of net profits, then the company can essentially zero out profits each and every year. You may have substantial rights; then again you may have very few. It all depends on the contract. Consult with a good business or franchise attorney in your area for specific advice.
Mr. Franchise - Kevin B. Murphy, B.S., M.B.A., J.D.
Franchise Attorney
Franchise Foundations APC
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