Investing in a startup requires a healthy appetite for risk, and with startups sometimes you have to kiss a lot of frogs to find a prince or princess. When the start up you’ve invested in fails, there are prudent steps to take before the company closes its doors (or garage doors).Read More
Stock options, warrants, put/call agreements and other agreements involving business ownership rights are often used by growing privately-held companies. Many legal issues may arise when those rights are in dispute.Read More
We’ve previously discussed integration clauses in contracts providing that a written agreement is the complete and final expression of the parties’ agreement and that it cannot be contradicted by evidence of a prior or contemporaenous oral agreement. If you want the term in the contract then it should go in. This is contained in California Code of Civil Procedure Section 1856. Fair enough.
In late December, the California Court of Appeal decided Albert Kanno v. Marwit Capital Partners II, L.P. involving Albert Kanno’s sale of three businesses to a private equity fund. There were three agreements--a sale agreement, stock subscription agreement, and stockholder agreement, and all three had integration clauses. But Kanno alleged there was also an oral Stock Redemption Agreement.Read More
The Delaware Chancery Court has issued two recent opinions describing shareholder rights to inspect corporate books and records. Both cases center on Delaware General Corporation Law, Section 220, under which shareholders “have the right ... to inspect for any proper purpose … [t]he corporation's stock ledger, a list of its stockholders, and its other books and records[.]” 8 Del. C. § 220.Read More