MRL stands for management rights letter. U.S.-based venture capital investors will often ask for an MRL as a condition to closing a financing. Founders will often ask us, “what is…
ESG – or environmental, social and governance – is an umbrella term for a broad range of non-financial factors to evaluate a company’s operations and its resilience and sustainability over…
With special thanks to Jacob Hanna and Blake Martell for their contributions. Issuing option grants to incentivize employees, consultants and advisers is a near universal practice for start-up companies in…
Preferred Stock (like Common Stock) is a security that represents ownership in a corporation. In addition to the ownership interest, Preferred Stock has rights that Common Stock does not.
With India’s strong ties with Silicon Valley and its maturing tech and startup ecosystem, outside investments in Indian companies are becoming increasingly common. However, the Indian economic and legal regime…
For many entrepreneurs and investors who are familiar with the US venture capital scene, you may be surprised to hear the details of the bespoke corporate governance terms that are…
1. Experienced advisors Choose experienced advisors, including lawyers, auditors and financial consultants (if necessary), and get them involved early. Advisors who work routinely with the SEC and investment bankers –…
What is an early exercisable stock option? An “early exercisable” stock option is like any other stock option awarded to an employee, consultant, director or other advisor, except that the…
Officers of a company have more formal responsibility and authority than rank-and-file employees and are responsible for the management and day-to-day operations of the company.
The organizational meeting is an initial meeting in which the basic organizational formalities of the corporation are determined.
An option pool is a number of shares of stock reserved for issuance to service providers of a company pursuant to options and other equity incentives.
A person owes another fiduciary duties when that person has control over a financial interest of the other. For example, corporate directors owe fiduciary duties to that corporation’s stockholders.
The duty of care is one of the fiduciary duties and it is violated when an action is taken or not taken on the basis of inadequate information or without following a reasonable process.
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