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Surprise! Interns are Likely Employees.

As the summer quickly approaches, it’s the time of year that many employers consider hiring an intern for the summer.  Start-up companies may view this as an opportunity to hire students as “cheap” or “free” labor.  Unfortunately, there are a lot of misconceptions about unpaid interns.  The…

The Delaware Franchise Tax: Don’t Freak Out

Within the next few weeks, corporations incorporated under the law of Delaware will receive ominous notices from their registered agents or the Delaware Divisions of Corporations advising such corporations of their annual obligation pay the their Delaware Franchise Tax. Save for “83(b) elections,” “scalability” and “valuation”, no…

Angel Investors – Understanding Your Target

Most entrepreneurs will need to raise a small round of capital very early in their company’s life cycle to get the company off the ground. The amount is typically anywhere from $100K to $500K and is utilized to build the MVP (minimum viable product) and secure initial…

Primer on California Proprietary Information and Inventions Agreements

For entrepreneurs operating in innovation-driven marketplaces, protection of intellectual property is of foremost concern.  Accordingly, startups should require each employee and independent contractor they engage to enter into a Proprietary Information and Inventions Agreement.  While agreements of this nature go by several different names (e.g., Confidential Information…

Startup Operations – Identifying & Navigating Legal Risks

Many entrepreneurs have a good understanding of statutory limitations and regulatory constraints on the operations of the businesses they are starting.  That understanding often comes as a result of familiarity gained from years of experience operating in an industry.  Other entrepreneurs may be newer to an industry,…

Maintain the Limited Liability Shield

Entrepreneurs should form a business entity as soon as they embark on a new startup venture.  A key feature of business entities (e.g., corporations or limited liability companies) is limited liability, meaning that the assets of the owner of the business available to satisfy claims against the…

Term Sheets – Potential Traps for the Unwary

During its life cycle, a typical company enters into several key transactions. These can include debt and equity financings, an exclusive license of the company’s proprietary technology or an acquisition of the company by a strategic buyer. Before signing the “definitive agreement” for a key transaction, however,…