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Intellectual property (IP) has become a bit of a buzzword in the legal world. The thing is that even though most people have some idea about the concept of intellectual property, they may not fully understand what it exactly it includes. In its simplest form, intellectual property is basically anything that is not tangible property. In other words, while tangible property would be things like your car, house, or jewelry, intellectual property instead covers art, photos, videos, poetry, inventions, music, films, designs, software, logos, graphics, designs, brands, and secrets.
Naturally, establishing ownership over those types of intangible assets is just as important as having ownership over tangible ones, if not even more valuable. As an example, take into consideration the value of the Apple logo and branding, the copyrights and respective royalties of Game of Thrones, and the many patents that go into making a new product for consumer use. All of these instances involve invaluable intellectual property that must be protected to ensure profitability and ownership. In fact, intellectual property just gets more and more crucial to our economy, especially with the boom of mobile tech and software.
If you created and own intellectual property, you’ll want to protect and profit from it. There are two primary ways of achieving that. One way is by making use of the intellectual property yourself; for example, you could manufacture a patented product or sell original copyrighted products you have ownership of. Alternatively, you can choose to license the intellectual property to another entity, effectively granting them the right to manufacture your patented product or make use of your copyrighted material in some way. That’s exactly where licenses come into play. They are basically contracts which help you regulate, manage, protect, and profit from your intellectual property and creations.
A licensing agreement permits an intellectual property rights holder (AKA the licensor) to make profit from an invention, creation, or novel work by charging a user (AKA the licensee) for the product’s use, distribution, or commercialization. Licenses also serve to protect proprietary rights in other related fields, like software development and other OS or virtual products. Importantly, you should know that you have the ability to use licenses to give someone permission to utilize your intellectual property in a certain way for a specific period of time for a particular price.
For the most part, all kinds of intellectual property that you will encounter fall nicely into one of the following four categories.
Since intellectual property law is one of the most complex areas of law, requiring tons of cross referencing with both state, federal and international law, it’s in your best interest to ensure you have an intellectual property lawyer in place to safeguard your rights and creations. Outside of that, the US Patent and Trademark Office (USPTO) and the US Copyright Office also offer invaluable information about the intellectual property registration process. A few intellectual property safety measures, such as copyrights, happen automatically in certain scenarios but even those should get formally registered with the government. Several other protective measures, like patents and trademarks, are granted by the USPTO and for those the application process is even more convoluted. As for trade secrets, those often don’t get “registered” formally at all, but they can still be subject to some protective measures in place through a variety of state and federal laws.
Despite all those intricacies, licensing agreements do not always have to be so long and hard to understand. If you think about it, an effective agreement is one that is upfront and transparent because it is more likely to be agreed upon and respected by both parties, and, ultimately, it’s more likely to be upheld and enforced by the courts. As such, there are certain terms, condition, and factors that you’ll always want to address in the majority of licensing agreements surrounding intellectual property.
The first major issue you’ll want to address is the scope of the license. For example, do you want the licensee to have unlimited use of your intellectual property, or do you want the licensee to only use your intellectual property in specific ways for a limited period of time? In this sense, you can think of licensing as assigning limited use rights for property to the leaser. The rights that the agreement provides should be broad enough so the buyer is interested in their stake in the deal, but narrow enough that you do not relinquish permanent, uncontrollable power over your valuable creation or asset. Imagine that you created a great song track that a company wants to use in the intro and outro of their latest ad campaign. You’d want to draft up a licensing agreement that limits the edits that the company can make to your original track, sets a time limit for how long the track can be utilized by the company, and ensures that the company provides credit to you somewhere in the ad or the website so that viewers can be aware of your work and your name.
Besides the scope, drafting up terms that describe and regulate the profits and revenue that your creation will generate is crucial. Some license agreements will simply work by having a one-time licensing fee, paid out in full. In this version of the deal, the licensor will immediately pay you some agreed upon amount and then they will be able to use your creation for a fixed period of time. Another way it could go down, is through recurring payments and profits such as royalties or monthly leases. In this scenario, the licensor has to pay you quarterly payments over over the course of the entire leasing period. It’s up to you to think about which of those arrangements would work best for your given needs and situation.
While the scope and revenue aspects are arguably the two most relevant parts of any licensing agreement, there is a plethora of other factors to consider mentioning as well. These can include:
Problems can always emerge in the realm of intellectual property and even after a licensing agreement is signed, sometimes the licensor may use your creation in a way that violates the terms of your agreement. They can breach the contract if they fail to compensate you fairly as per the agreed upon terms in the licensing agreement, by sub-licensing your property elsewhere against your agreement, or by any number of other means that can violate your terms. In these scenarios, you have the right to file a lawsuit against the party that committed the breach of your agreement in an attempt to enforce your intellectual property rights. You can seek remedies through damages, losses, or other harm that you may have sustained as a result of the licensee breaking your agreement.
As we have seen, intellectual property law is unfairly complex and tricky to navigate–especially on your own. This is because licensing agreements and intellectual property management requires specialized knowledge of state and federal laws pertaining to your rights as well as a strong awareness of business practices and judgements. To make sure you have the best experience with your new creation and to honor the integrity of your intellectual property, it is vital that you have access to skilled Glendale intellectual property lawyers in this particular field of law. We at KAASS LAW believe in your ability to produce meaningful novel works of art and innovation and we fight to ensure our clients receive the correct treatment and compensation for their intellectual and artistic property. If you or a loved one need legal counseling or help surrounding an issue regarding intellectual property, licensing, trademarking, or copyrighting, then do not hesitate to contact us. We invite you give us a call at (310) 943-1171 to speak to our Trademark and Patent lawyers today. KAASS LAW, 815 E Colorado St #220, Glendale, CA 91205, (310) 943-1171
KAASS LAW is authorized to practice law in California. The above content is intended for California residents only. This content provides only general information which may or may not reflect current legal developments. KAASS LAW expressly disclaims all liability in respect to actions taken or not taken based on any of the contents of this website. The above content DOES NOT create an attorney-client relationship. KAASS LAW does not represent you unless you have expressly retained KAASS LAW in person at the KAASS LAW office. KAASS LAW helps clients in: Los Angeles, Burbank, Hollywood, Glendale, Van Nuys, North Hollywood, Studio City, Highland Park, Eagle Rock, Sunland, Tujunga, Sylmar, San Bernardino, La Crescenta, La Canada, Beverly Hills, Westwood, Santa Monica, Brentwood. Pacoima, Montebello, Commerce, Alhambra, Downey, Bell, Maywood, Walnut Park, Vernon, Lynwood, Echo Park, Silverlake, Mission Hills, Northridge, Woodland Hills, Encino, Canoga Park, North Hills, Porter Ranch, Chatsworth, Reseda.
A design patent acts as a form of legal protection given to an ornamental design of a functional item. In practice, what this means is that a design patent prevents others from using, selling, or copying an object with a design that is substantially similar to the design you claimed in the patent. As a result, you have exclusive rights over ownership and distribution of the design. This is a tremendous right to have, particularly since you put in a lot of hard work and effort into creating the design. Some examples of patentable designs include jewelry, furniture, containers, and computer icons.
It goes without saying that there exist different categories, or types, of patents. In the United States, there are three which occur most frequently and which offer the most utility and practicality. The first type is a utility patent, which covers new inventions and creations. The second is a plant patent, which enables an applicant to patent new strains of plants, and finally, the last type of patent is for design. This is the one you will want to apply for if what you created is a style, form factor, or design that has a practical utility to it. Fortunately, due to the vague wording regarding US patent law, there are lots of design creations that can be covered.
You have probably heard of trademarks before, but what you almost certainly haven’t learned about is the process by which you can get something trademarked. The trademark submission process is a federally regulated, highly specialized endeavor that requires lots of detailed information to show how your product, company, good, or service is unique enough to warrant a trademark. The application goes through the United States Patent and Trademark Office, or USPTO for short.
Upon filing a trademark application with the USPTO, you will have to wait through a three to four month period for them to begin the initial assessment and consideration of your application. During this time, there is not much else you can do and, therefore, you ought to ensure that your application is presented as clearly and as succinctly as possible so as to avoid any further delays in the process. At that point, an examining attorney reviews your application and compares it to other, pre-existing trademarks to ensure that there are no conflicts of interest. After this initial overview, the attorney will forward your trademark for publication.
The reason copyright registration exists is to establish a formal, verifiable record of the date of creation and the contents of a work, so that, in case of a lawsuit, infringement, or plagiarism, the copyright owner can point to an official government source. The idea is that having the government officially document and recognize your work will add legal credibility should the issue ever surface in court. However, helping to resolve legal disputes is just one reason why someone may want to copyright their work. There are many motivations one may have for it, but first, it’s a good idea to understand what exactly a copyright entails.
Copyrights protect intellectual works, both published and unpublished, tangible and intangible. Copyrights can be used to protect everything from literary works, to songs, to computer programs, to photographs and films. Because of how broadly copyrights can apply, it would be a nightmare to have to manually copyright every new creation or work. Fortunately, that no longer is the case. In most countries across the world, copyright gets granted automatically at the moment of ‘fixation’, or the moment in which the work is fixed in some tangible medium. This is largely thanks to the international Berne convention, which provides rights at a global level without a need for national registration. Therefore, it is also important to avoid confusing copyright registration with the mere granting of copyright. The granting of copyright happens automatically once a work undergoes ‘fixation’, while copyright registration is a formal process that must be completed by filing a request through your government. The U.S. still does provide certain legal advantages for registering works of U.S. origin through the formal copyright registration process. For instance, having a registered copyright is still a prerequisite to filing an infringement lawsuit. Furthermore, other important remedies rely on prompt registration and verification, such as attorney fees and statutory damages. Therefore, for most people in the U.S. it is still extremely beneficial to have your work undergo the copyright registration. Also noteworthy to consider is that under U.S. copyright law, the protection that is granted to the owner of the work allows them exclusive rights to make and distribute copies of the work, to perform or display the work publicly, to produce derivative or iterative works such as translations, sequels, or adaptations, and to digitally transmit recordings of the copyrighted material.
A stock purchase agreement, or an SPA for short, is an agreement that a company or its shareholders and buyers sign whenever shares of a company or corporation get bought or sold. Stock Purchase Agreements are used most often by smaller corporations when selling their stock publicly to create a certain amount of trust and security between buyer and seller. Both the company itself or its respective shareholders can sell stock to potential buyers. That’s where Stock Purchase Agreements come in very handy as their purpose is to protect you, regardless of whether you’re the buyer or the seller.
It’s important to know that a stock purchase agreement is not the same things as an asset purchase agreement, or an APG. The main difference is that stock purchase agreements only sell shares of a company in order to raise money or to transfer ownership of shares while asset purchase agreements aim to finalize company asset sales. Namely, the stock purchase agreement will outline several key points:
When establishing a company, one of the first and most important decisions you will have to make is whether to form the company as a corporation, an LLC, or any of the other common forms of business organization. Each of them offer various advantages and drawbacks to their ownership and, as such, it is up to you to look into which one will most effectively fit the needs of your business. To help with that crucial decision, we have several articles which go over the different pros and cons of each method of business organization.
Should you choose to go with making a corporation, you will then be faced with having to more rigorously document certain proceedings as a result of how California law interacts with corporations. Some view these more specific details as a nuisance that corporations simply must contend with. We, however, believe that many aspects of the extra bookkeeping that you must track and report are actually very strong indicators of the strength of corporations. By viewing these requirements from that perspective, we can greatly simplify and empower the role that the bookkeeping tasks serve.
There are many reasons why you might want to incorporate your business. Forming a corporation helps to protect your personal assets from liability on account of your business’s debts and transactions. Furthermore, a corporation can protect you as an individual in the event that a business partner or employee is found guilty of a crime. If this is the business organization model you choose, there are several steps you will have to take in order to finish the incorporation process. Firstly, let’s start with naming it.
This part is one of the most important things you can do for your business. A good name is key because it will help with good product promotion and branding. However, the state you file for incorporation must also be okay with your chosen name. This usually means that the name must not already be taken by another corporation that is registered in your state and that the name is distinct enough from other corporations’ names that it would not bring up issues of copyright. Your chosen name can (but does not have to) include the words “Incorporated”, “Corporation”, “Limited” or any abbreviated version of them. Furthermore, your chosen name cannot be misleading to customers, nor can it contain any offensive or controversial words. It is possible to check to see whether your name of choice is already taken by another corporation online by visiting an online entity name checking service, or by sending a name availability inquiry letter to the Secretary of State’s office. Lastly, you can reserve your name by filing a name reservation request form, which just requests that the Secretary of State hold your chosen corporate name for no more than 60 days while you finish the filing process.
Penal Code 1203.4 outlines California laws which govern expungements of criminal records. An expungement, sometimes referred to as a "dismissal", discharges a person from the criminal conviction. Specifically, an expungement is a type of post-conviction relief which removes a person from the consequences of a conviction. It’s imperative to understand this penal code and the benefits that it may offer to those who have been accused and convicted of a crime, especially since it may potentially clear your criminal record. The word “expungement” is somewhat confusing as it infers that criminals records can be erased. Expungements are post-conviction, post-probation petitions for dismissals; the court substitutes a “Not Guilty” plea for the earlier finding of guilt, and dismisses the case. After this time, the guilty plead is no longer on the criminal record because technically you are no longer guilty of the charge. However, in most government application you may still need to disclose the prior conviction even after it has been expunged.
In the previous article, we went over what a limited liability company, or LLC, is and why you may want one. It offers various lucrative advantages to its member-owners and it comes with relatively few strings attached. Such an idyllic scenario is very rare to stumble upon in the corporate realm, which is why many businesses aim to achieve LLC status. However, to establish an LLC there are some key requirements you must complete in order for the state of California to grant recognition of your company as an LLC. Firstly, you’ll need to select a business name, then you’ll have to file the necessary documentation to the state of California, and you will have to come to an agreement with the other members of the LLC as to how everything will be run. Let’s start with that first part.
To start, you’ll want to decide upon a name for your LLC. But the trick is that you’re not the one that’s going to do the final deciding. That’s reserved for the state to decide and grant. As a general rule, you’ll want to ensure that the name you’ve settled on is:
An LLC, or limited liability company, is a term used to describe a private limited company. LLCs, along with LLPs, are relatively new forms of business organization in the United States. In particular, LLCs have gained much traction and popularity in the United States because of the many perks they offer over other, perhaps more traditional, forms of business organization. They carry with them very few disadvantages and as such, for many businesses an LLC is an idyllic means of conducting business. If you are considering which form of business is best for your new venture, or if you are considering changing your business to an LLC, it is definitely worth taking a few minutes to read on about their potential benefits to your business.
Many of the perks and benefits that a limited liability company offers stem from its unique status as a hybrid form of business organization. This hybridity allows for it to offer the benefits of limited liability like a corporation, while also simultaneously providing the tax advantages of a partnership. Essentially, an LLC can dip in between both types and offer dual benefits to its member-owners. As a result of these dualities, many businesses favor becoming an LLC, a trend that is only further encouraged by state statutes permitting and simplifying their establishment and longevity.
Another way that U.S. design patents stand out from others, is that they allow for the applicant’s work to remain hidden or secret. This can be particularly vital if the design is for a new, revolutionary product or software. With more and more emphasis being placed on smart technology, innovation in the field is going to rely more and more on intelligently designed products to captive consumer interest and to garner positive feedback to an ever-increasing amount of press outlets. For the competitive edge alone, having a guarantee that a design patent application will remain secret and not be published until after it is granted can be massive for both large companies and small, independent businesses and startups.
A great example of design patents playing a huge role in modern day product placement and marketing is how it can be a decisive factor in lawsuits. For example, in Apple v. Samsung, the pre-emptive design patents that Apple had applied for turned out to be the huge ace card in the dilemma, winning Apple the lawsuit and millions of dollars from Samsung. A great of relating utility and design patents is by considering Apple’s iPhone: the way it works is the result of many utility patents and the way it looks and displays information is the result of many design patents. As technology changes and adapts, the role of product design will continue to blur function and ergonomics, making novel designs more and more valuable.
Prior to thinking about how to file your design patent application, you’ll want to ensure that your design is, indeed, novel. For this, you’ll have to search through prior art and this step is one of the most grueling as the archive is very expansive and it can feel overwhelming to search through such a huge amount of patents. You’ll want to look closely for the combination of design elements that you wish to protect with your patent to make sure it hasn’t already been claimed. Even down to the font that you use can be subject to a design patent.
This is where you will need to put together all of your findings to present to the USPTO in your application. Here, you’ll want to mention what sets your design apart from others, highlighting its novel features. Further, you should include drawings and diagrams demonstrating this. Putting everything together, you’ll have everything you need to file your design patent application...but why go through all of that headache alone? At KAASS LAW, we are constantly inspired by the beautiful and innovative designs and creations of artists and visionaries. We have years of experience in filing for design patents. We work directly with you to document, record, gather, and showcase all of the novel features of your product design so that the application process is quick and successful. We invite you to give us a call at (310) 943-1171 to speak to our Trademark and Patent lawyers today. KAASS LAW, 815 E Colorado St #220, Glendale, CA 91205, (310) 943-1171
KAASS LAW is authorized to practice law in California. The above content is intended for California residents only. This content provides only general information which may or may not reflect current legal developments. KAASS LAW expressly disclaims all liability in respect to actions taken or not taken based on any of the contents of this website. The above content DOES NOT create an attorney-client relationship. KAASS LAW does not represent you unless you have expressly retained KAASS LAW in person at the KAASS LAW office. KAASS LAW helps clients in: Los Angeles, Burbank, Hollywood, Glendale, Van Nuys, North Hollywood, Studio City, Highland Park, Eagle Rock, Sunland, Tujunga, Sylmar, San Bernardino, La Crescenta, La Canada, Beverly Hills, Westwood, Santa Monica, Brentwood. Pacoima, Montebello, Commerce, Alhambra, Downey, Bell, Maywood, Walnut Park, Vernon, Lynwood, Echo Park, Silverlake, Mission Hills, Northridge, Woodland Hills, Encino, Canoga Park, North Hills, Porter Ranch, Chatsworth, Reseda.
Publication does not actually mean that you are out of the woods just yet. Rather, it refers to a 30-day comment period which every aspiring trademark must undergo. Within that 30-day time frame, anyone from the public can voice their opposition to your trademark request. What that means is that even if the U.S. government has no issue with your trademark application, any person can theoretically state that your trademark may bring damages to their own brand and with that statement they could make their opposition to your trademark. However, once the 30-day window is over, the application gets sent back to the examining attorney for the final review stage. Once the application reaches this state, and provided that you correctly filed the paperwork indicating that your trademark is in use (meaning that your products and services were still being sold at the time the application got filed) then the examining attorney will issue your trademark registration and a certification will get sent out to you through the mail.
The entirety of this registration process for your trademark will take anywhere from 6-8 months time. It is a slow and steady process that involves a lot of down time while you wait for the next stages of the application to undergo final review but once it is all over, you will have successfully trademarked your product, brand, or service through the federal government. So, why would you want to go through that grueling process in the first place?
There are several major reasons why someone would want to obtain a federal trademark. Some of those important reasons include:
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At KAASS LAW, we believe in the spirit of individuality and in the power of originality. Your brand, your ideas, and your products deserve the protection and exclusivity that only a trademark registration can offer them, because it was your hard work and intellect that enabled you to create those ideas and services. Our team of experienced intellectual property and trademark lawyers will ensure the process is as quick and efficient as possible. We invite you to give us a toll free call at (310) 943-1171 to speak to our team today. Let us help you in this critical moment of your enterprise’s expansion.
Copyrights can be bought, sold, or given away to others. A transfer of copyright or an exclusive grant or license to utilize the work is possible only if it is conveyed in writing from the original owner of the copyrighted material. Also, copyrights do not protect the underlying ideas or concepts in the creator’s work. The legal terminology here gets a bit vague but basically ideas, facts, methods, titles, discoveries, works which do not have original authorship, and works with expired copyrights are not protected under U.S. copyright law. Bear in mind also that copyright law is intrinsically territorial and the information which we have talked about only applies to U.S. copyrights, which themselves are granted only to works of U.S. origin. The final aspect of copyrights that we should discuss is their length, or period of effect. The law regarding the length of copyright says the following for:
As previously mentioned, nearly all original works created after 1978 have some form of automatic copyright protection. To recap the important points, bear in mind that any original work automatically gets copyright protection once it is ‘fixed’, however, formally registering your copyright with the U.S. Copyrights Office still offers certain lucrative advantages, such as unlimited and exclusive control and ownership of the work, allowing for increased security and easier time dealing with any potential legal matters in the future, should the need ever arise.
At KAASS LAW, we believe in the spirit of genuine creativity. For that reason, protecting your original works is something we treat very seriously. If you or a loved one have created an original work, we invite you to call us at (310) 943-1171 to speak to one of our intellectual property lawyers today. Our team will ensure your works get registered with the U.S. Copyrights Office in the quickest and most efficient way possible so that you can keep creating beautiful works.
KAASS LAW, 815 E Colorado St #220, Glendale, CA 91205, (310) 943-1171
Our lawyers in Glendale, Los Angeles, California, at KAASS LAW are authorized to practice law in California. The above content is intended for California residents only. This content provides only general information which may or may not reflect current legal developments. KAASS LAW expressly disclaims all liability in respect to actions taken or not taken based on any of the contents of this website. The above content DOES NOT create an attorney-client relationship. KAASS LAW does not represent you unless you have expressly retained KAASS LAW in person at the KAASS LAW office.
Finally, prior to reaching a lasting agreement, a letter of intent, or LOI, must be produced by the seller, explaining the proposed sale at length. It’s up to the buyer to have the presence of mind to make sure that the purchase agreement contains the same terms as the LOI does to avoid any future discrepancies which may arise.
Stock purchase agreements get broken up into several sections that aim to define what certain terminologies mean and to describe how the transaction process works. The contents of a stock purchase agreement will typically resemble the following:
The first part of a stock purchase agreement is called the preamble. In it, the agreement is formalized and the respective parties are identified as well as the date of the contract and purchase. Typically, parties are referred to as either “seller” or “purchaser”. After these key points of information get stated in the preamble, the next section begins and it is normally called the Recital. This part serves as the main meat and bones of the agreement outline.
The definitions section is the first article on most stock purchase agreements as it defines certain key terminologies and phrases which will get used all throughout the agreement. All of the relevant terminology that gets defined will be either boldfaced or capitalized and they will usually be listed in alphabetical order. The attention to detail with the terminology definitions is very crucial, because while it can be very tempting to skip through this section, understanding exactly what these terms mean in the context of the purchase agreement is key since it can drastically impact the meaning of the agreement. Therefore, you really should take the time to read through the whole section so as to familiarize yourself with the wording and its meanings within the agreement. In particular, words such as “liabilities”, “material adverse effect”, and “seller’s knowledge” can all have huge effects on the contract just depending on how they are defined in a particular context.
In this part of the agreement, the exact terms of the sale will be outlined at length. It will contain a part that refers to the seller transferring ownership or selling to the purchaser or the buyer acquiring from the seller some specified amount of shares. Further, the purchase price and any adjustments made to it will be clearly shown here, including:
In this segment, the seller’s warranties are stated expressly and get defined. Untruthful or incorrect representations of warranties can result in the liability of whichever side made the statements. This may include statements concerning past and future facts related to the business, such as:
For the most part, this part of the agreement is identical in function to the previous section, except that it focuses on the warranties and representations from the buyer’s side. Oftentimes, these two sections mirror each other quite closely. Since the buyer usually pays cash for the stock, their warranties may be more limited than the seller’s.
Most deals have a set time frame from when the parties agree to sign off and the actual closing. Because of this limitation, the covenants segment of the agreement outlines things that each party should avoid doing during that time frame. Typically, this translates into a long list of actions that need to happen during that time period in addition to some actions which are outright prohibited until the closing of the arrangement.
This part of the agreement is comprised of terms and conditions that either need to be met or waived prior to the time that the arrangement closes. These conditions often include both sides carrying out their pre-closing covenants and ensuring that all terms are fulfilled.
Article seven aims to clarify indemnification rights by stating the terms whereby the other party gets compensated just in case one party breaches their contract. It will also typically include a section discussing the losses that may arise from specific cases. You can expect this section to talk about:
In the eighth article, you’ll encounter details about each party’s right to terminate the contract. This will typically cover some of the follow reasons for termination:
The final section of an agreement will always end with a section that goes over any miscellaneous provisions. These provisions touch base on several subjects, like:
Stock Purchase Agreements matter because they articulate the terms of a sale and they put it into writing. They can prevent arguments or misunderstandings that would otherwise end up in court. Furthermore, the agreement also gives the buyer more faith in the transaction since the seller has the chance to describe why they are selling. Lastly, it also details other important details, such as warranties, dispute resolution means, and covering costs when unexpected problems cause loss.
Admittedly, there are few situations where having a Stock Purchase Agreement wouldn’t be useful, such as:
Even then, however, an SPA can only help, never hinder you.
There are a few instance as to why a Stock Purchase Agreement is crucial to use, which may include the following situations:
Some common mistakes that people make is thinking they don’t need to make a Stock Purchase Agreement because the person they’re selling to is someone known. That decision affects your whole company, so there’s no room to leave things to chance or faith. Similarly, simply filling out a pre-made stock purchase agreement template from the internet is probably not a great idea either as it likely won’t contain all of the relevant clauses needed for your business. It’s always best to have legal professionals craft your document after meeting with you to assess the individual needs and interests of your business. That’s where we can help you.
We have extensive experience with drafting and filing Stock Purchase Agreements for our clients. We invite you to give us a call at (310) 943-1171 to speak to a California corporate attorney today. Our lawyers in Glendale, Los Angeles County, California, will ensure that your transactions are always in your best interest.
KAASS LAW, 815 E Colorado St #220, Glendale, CA 91205, (310) 943-1171
KAASS LAW is authorized to practice law in California. The above content is intended for California residents only. This content provides only general information which may or may not reflect current legal developments. KAASS LAW expressly disclaims all liability in respect to actions taken or not taken based on any of the contents of this website. The above content DOES NOT create an attorney-client relationship. KAASS LAW does not represent you unless you have expressly retained KAASS LAW in person at the KAASS LAW office. KAASS LAW helps clients in: Los Angeles, Burbank, Hollywood, Glendale, Van Nuys, North Hollywood, Studio City, Highland Park, Eagle Rock, Sunland, Tujunga, Sylmar, San Bernardino, La Crescenta, La Canada, Beverly Hills, Westwood, Santa Monica, Brentwood. Pacoima, Montebello, Commerce, Alhambra, Downey, Bell, Maywood, Walnut Park, Vernon, Lynwood, Echo Park, Silverlake, Mission Hills, Northridge, Woodland Hills, Encino, Canoga Park, North Hills, Porter Ranch, Chatsworth, Reseda. Get Directions on Google Maps
The whole reason that corporations have to deal with a detailed and pesky bookkeeping record is because California law requires it. According to California Corporation Code 1500, every corporation must maintain a detailed and accurate record of accounts and outlines of the time that the executives and owners spend on meetings. In fact, even shareholder, board, and committee meetings and decisions must be documented and housed in the executive headquarters. Further, all shareholder names, addresses, and amounts of shares owned must also be accounted for in the report. For smaller corporations, this is already a nightmare to contend with, but the larger your corporation grows, the more annoying and tedious this law becomes.
The other part of this dilemma to consider is how exactly all of that information is going to be stored. Clearly, the records must account for information that is not only sensitive but also deeply personal and intimate with respect to the company and its shareholders. All of those people are going to be relying on the corporation to ensure the safety of their credentials and information. To that end, there are a few methods of bookkeeping that are worth discussing. The law only goes so far as to specify that the records must be kept either in written form or in some other form that is capable of being converted into a clear, legible, tangible form, or any combination of the aforementioned. Therefore, you actually have some wiggle room here in terms of deciding how to store the necessary information. You can, of course, choose to go the traditional route of simply keeping all the information on hand in paper form. The upside is that you will always have the original paper copy of the records, but the obvious downside is that those records are susceptible to being permanently lost or damaged. The alternative would be to store those records digitally, by uploading them onto your corporation’s secure server from the beginning by means of software. The pro in these situations is that you are unlikely to ever completely lose all of your important bookkeeping records, but the drawback is that now all of that sensitive information is potentially vulnerable to online attack. In these situations, cybersecurity becomes a major concern.
As we have seen there is no one method that manages to avoid all risk, and that’s a large part of the reason why California Corporate Code 1500 can be such a hassle for corporations to deal with. However, we can help. Our firm has extensive experience with helping businesses through the issues that may arise from record keeping as per California Corporate Code 1500. We invite you to us a call at (310) 943-1171 to speak with our California corporate lawyers today. Our lawyers in Glendale, Los Angeles, California, are dedicating to providing our clients with the highest quality services possible. KAASS LAW, 815 E Colorado St #220, Glendale, CA 91205, (310) 943-1171
KAASS LAW is authorized to practice law in California. The above content is intended for California residents only. This content provides only general information which may or may not reflect current legal developments. KAASS LAW expressly disclaims all liability in respect to actions taken or not taken based on any of the contents of this website. The above content DOES NOT create an attorney-client relationship. KAASS LAW does not represent you unless you have expressly retained KAASS LAW in person at the KAASS LAW office. KAASS LAW helps clients in: Los Angeles, Burbank, Hollywood, Glendale, Van Nuys, North Hollywood, Studio City, Highland Park, Eagle Rock, Sunland, Tujunga, Sylmar, San Bernardino, La Crescenta, La Canada, Beverly Hills, Westwood, Santa Monica, Brentwood. Pacoima, Montebello, Commerce, Alhambra, Downey, Bell, Maywood, Walnut Park, Vernon, Lynwood, Echo Park, Silverlake, Mission Hills, Northridge, Woodland Hills, Encino, Canoga Park, North Hills, Porter Ranch, Chatsworth, Reseda. Get Directions on Google Maps
Next, California corporation's have to prepare and file your Articles of Incorporation to the Secretary of State’s office. These documents are what the state will use to establish your corporation as a business entity. The articles must contain the name of the corporation, its purpose, the name and address of a registered agent, the street address of the corporation, the amount of shares that the corporation is authorized to issue, and the signatures of the incorporators. As it pertains to outlining the shares of the corporation, your Articles of Incorporation must account for some specifics. If the corporation will have only one class of shares, then the articles of incorporation must list out the total amount of shares that the corporation is authorized to issue. On the other hand, if the corporation is to have more than one class of shares, then the articles must account for the total amount of authorized shares in each class, the designation of each class, and the rights and restrictions that may apply to each class.
In California, every corporation must have an agent for service of process in the state. This agent has to be a person living in California or corporation that has registered within the Secretary of State’s office as a corporation. The registered agent agrees to receive legal papers on the corporation’s behalf, in the event that legal action is taken. A corporation cannot be its own registered agent. Lastly, note that the registered agent, be it person or corporation, must have a physical address, meaning a PO box is not sufficient. Next up, you’ll want to set up your records book. California Corporations Code 1500: It Pays to Keep Receipts Pursuant to California Corporations Code 1500, your corporation must keep track of important internal information. For this reason, you must set up a corporate record book (physical or virtual), in which you document important corporate paperwork, including minutes of director and shareholder meetings, stock certificates and stubs and shareholder information. Once again, this record must be quite extensive and thus the information it contains is also highly sensitive. It is vital to ensure that the physical and cybersecurity of the record book is of a high standard. It may pay dividends to see our in-depth article about your options for corporate bookkeeping here.
After you’ve taken care of the method of record keeping, you’ll then need to specify the people who are applying to form the corporation. California law allows for one or more persons, corporations, partnerships, or associations to form a corporation. The people who apply to form the corporation are called incorporators and they are responsible for filing the articles of incorporation. The incorporators should also elect directors and officers, and agree upon corporate bylaws. Upon selecting directors, the incorporators have no further responsibilities. The requirements for specifying incorporators are that the corporation must have at least one incorporator and that their name(s) be listed on the articles of incorporation.
Once the incorporators have named the directors, your new directors will have the responsibility of setting and carrying out corporate policy. From then on, those directors have fiduciary duty to the corporation and its respective shareholders, which ensures that they must always act in the corporation’s and the shareholders’ best interests. The requirements for specifying directors for your corporation are only that there must always be at least one director and that the maximum amount of directors is proportional to the maximum amount of shareholders.
After your corporation has specified its directors, California law requires that your corporation state its purpose. While a statement of purpose may not sound particularly complicated, it is actually a very nuanced part of the procedure to forming your corporation. The reason for this is that you would ideally want to leave the purpose statement as vague as possible so as to cover as much breadth and scope as possible. This would enable your corporation to operate within all possible boundaries of the law as it pertains to business. Therefore, it’s imperative to use generic language for your corporation’s purpose statement. For this part, having legal counseling is particularly useful because a seasoned business lawyer will know the best way to word and compose such statements.
Lastly, the final thing you will want to do is to draft up and sign off on corporate bylaws with the incorporators and directors of the corporation. The irony is that this crucial document is not actually required to be submitted to the Secretary of State’s office like the rest of the Articles of Incorporation are, but they are nonetheless vital to have for the smooth upkeep and maintenance of your corporation. This is because incorporation bylaws describe how the company will conduct its operations, how directors and officers are to be appointed, their duties and the manner by which executive meetings take place. It is required that you have your corporate bylaws handy at the corporation’s headquarters. They must also specify whether there is a maximum limit to the amount of directors the corporation can have, or whether that maximum will be determined later by a board or shareholders. It’s also worth noting that there can’t be anything illegal written into the bylaws because state and federal law supersede its authority. Bylaws are also extremely useful for showing that your corporation is legitimate to potential investors and to the IRS.
The process of forming a corporation can be daunting and tedious, but you do not have to face it alone. As alluded to earlier, experienced business lawyers can greatly speed up and smoothen the process of formalizing your corporation as a legal entity. Our team of California business lawyers have many years of experience with the process and can help your company achieve corporation status quickly and effectively. We invite you to give us a call at (310) 943-1171 to see how a Glendale corporate formation lawyer can help. Our lawyers in Glendale, Los Angeles, California, are dedicating to providing the highest quality legal services for all of our clients.
Under Penal Code § 1203.4, an expungement essentially discharges a person from whatever sentencing they were given due to being convicted of a crime. One powerful advantage that expungement offers is that an expunged conviction does not typically have to be disclosed to potential private employers or institutions. As it stands, California law prevents employers from inquiring about an applicant’s previous criminal record until such a time when the employer proposes a legitimate offer of employment. However, once a conviction gets expunged, it doesn't need to be revealed to an employer even after the employer makes a job offer. However, you may still be required to disclose the expunged conviction if filing any applications with government organizations such as for professional licensing with the Contractors State Licensing Board; State Bar of California; Medical Board of California; California Board of Pharmacy; California Department of Real Estate; California Board of Accountancy; or any such other licensing board that requires a Live Scan for California Department of Justice (DOJ) and Federal Bureau of Investigation (FBI) level criminal history record checks.
Someone who was sentenced for a crime in California is eligible for expungement provided that:
Individuals are not qualified for expungement in the event that they:
Expungement is a huge step forward for many individuals who have been accused of a crime. This crucial step allows for a much easier re-entry into society and we can help you to get there! If you or a loved one may benefit from an expungement, give us a call at (310) 943-1171 for a free criminal defense consultation with one of our Glendale criminal defense attorney today. Our lawyers in Glendale, Los Angeles, California, are dedicating to providing the highest quality legal services for all of our clients. Get Directions on Google Maps
Lastly, it’s also definitely worth making sure that your chosen LLC name doesn’t infringe upon any potential copyright issues. If your name is too similar to another LLC’s name, then you may be held in contempt of copyright violation.
This second step is arguably the most important one on the list. You will have to create and file Articles of Organization. These are important documents which outline and affirm the initial statements required of you to form an LLC. The Articles of Organization will be filed to the state secretary’s office and, once approved, they establish the LLC as a registered business entity within the state.
The information that is required typically includes the name of the LLC, its registered address, the names of the owners and their roles, as well as a few more key points of information about the LLC. These documents are used by the state government to keep track of which LLCs are claimed and who their registered agents are. Registered agents must be designated in order for your LLC to get formed because that person will have legal authority to respond to any legal documents that your LLC may receive.
Lastly, you’ll want to draft up an Operating Agreement. This is an extremely important part of the LLC creation process because it plainly establishes the business’ financial and operational decisions, the processes for arriving at those decisions, the protocols and chain of command, as well as many other rules, regulations, or provisions. The main reason you’d want to spend quite a bit of time working on the specifics of an Operating Agreement is that it outlines and governs the internal operations of your business in such a way that is most suitable to the specific needs of the business owners. Therefore, by investing time in writing it out now, you will save a lot of frustration, confusion, and time later down the line.
Do note that once signed by the member-owners of the LLC, the Operating Agreement acts as an official contract which binds them to its terms and conditions. The legal significance of this document is yet another reason to spend time on it–should any legal disputes or issues arise between the owners of the LLC, the operating agreement is one of the first things the courts will point to. As such, you’ll generally want your operating agreement to mention:
Also, bear in mind that the Operating Agreement must be completely transparent and agreed upon by all members of the LLC. You will all have to sign the document affirming your assent to its terms and rules.
There are many points to make sure you get down in just right way while filing the documents for forming your LLC. In particular, the Articles of Organization and the Operating Agreement are so crucial to get right that the future of your business depends on it. That’s a very tall order to ask of anyone to complete on their own. That’s where we come in; you do not have to go through that process alone. We can help you with the filing of these documents so that you can focus more on your business and worry less about the details. Give our office a call today at (310) 943-1171 to speak to our experienced California business lawyers. We will make the process as smooth as can be.
KAASS LAW is authorized to practice law in California. Our lawyers in Glendale, Los Angeles County, California specialize in offering services for multiple practice areas. The above content is intended for California residents only. This content provides only general information which may or may not reflect current legal developments. KAASS LAW expressly disclaims all liability in respect to actions taken or not taken based on any of the contents of this website. The above content DOES NOT create an attorney-client relationship. KAASS LAW does not represent you unless you have expressly retained KAASS LAW in person at the KAASS LAW office. KAASS LAW helps clients in: Los Angeles, Burbank, Hollywood, Glendale, Van Nuys, North Hollywood, Studio City, Highland Park, Eagle Rock, Sunland, Tujunga, Sylmar, San Bernardino, La Crescenta, La Canada, Beverly Hills, Westwood, Santa Monica, Brentwood. Pacoima, Montebello, Commerce, Alhambra, Downey, Bell, Maywood, Walnut Park, Vernon, Lynwood, Echo Park, Silverlake, Mission Hills, Northridge, Woodland Hills, Encino, Canoga Park, North Hills, Porter Ranch, Chatsworth, Reseda. Get Directions on Google Maps
Insofar as questions of jurisdiction, LLCs share many traits with corporations. Like corporations, LLCs are creatures of the state. As such, they are formed and operated in accordance with state laws. Furthermore, both corporations and LLCs are treated as legal entities separate and distinct from their owners, who are instead referred to as ‘members’. Given their status as a legal entity, LLCs can sue or be sued, enter into contracts and arrangements, and hold titles to property or estates.
Notably, the members of an LLC enjoy limited liability just like the shareholders of a corporation would. Members can also undertake actions on behalf of the LLC, and as with a corporation’s shareholders, any damages or charges recovered go to the LLC, not to the members themselves. However, just like how courts can, on occasion, determine that they ought to disregard a corporation as a legal entity and hold shareholders personally liable for damages, so too can the courts pierce the corporate veil of an LLC to hold individuals accountable for damages. These cases, however, are extremely rare and far and few between.
As previously alluded to, the advantages of LLCs are many and the drawbacks are relatively few. One such disadvantage to consider is that the management structure of an LLC is not clearly stated nor defined in the legal literature. More often than not, it is up to the members to create, agree upon, and sign off on articles of organization which outline the key rules and principles of operation of the company. While, this may seem inconvenient at first, it can actually be viewed as a major advantage of an LLC, speaking to its flexibility and the level of freedom and control it can offer to its members. Below is a chart that effectively sums up the potential pros and cons of an LLC. Things to Consider About LLCs:
Advantages
Disadvantages
As you can see, the benefits of an LLC generally outweigh the drawbacks. For further information, use the following chart as a reference; it provides answers to many common questions surrounding the details of how an LLC works.
Characteristics of
A Limited Liability Company
Method of Formation
It is formed by an agreement of the owner-members of the company. Articles of organization are filed. Charter has to be given by the state.
Legal Position
It is treated as a legal entity.
Liability
Member-owners liability is limited to the amount of capital contributions or investments.
Duration
Can have perpetual existence, unless there is only one member (like a corporation).
Interest Transferability
Member interests are freely transferable.
Management Scheme
Member-owners can fully participate in management, or they can designate managers to oversee the firm on their behalf.
Taxation
LLC does not get taxed, and members are taxed personally based on the profits that get “passed through” the LLC.
Fees and Annual Reports
Organizational fee is required, as well as a possible business privilege fee.
Foreign Business Transactions
Generally no limitations.
While an LLC can offer you and your business many powerful tools and advantages, getting it set up as an LLC can be a somewhat difficult process. That’s where we can help. We have helped many clients start up LLCs for their businesses as well as converting an already existing business into an LLC. We always look for ways to help our clients maximize their profits in the legal realm, and this is no exception. If you or a loved one wishes to open an LLC, or has any further questions, we invite you to give us a toll free call at (310) 943-1171 to speak to one of our Los Angeles business lawyers today.
KAASS LAW is authorized to practice law in California. The above content is intended for California residents only. This content provides only general information which may or may not reflect current legal developments. KAASS LAW expressly disclaims all liability in respect to actions taken or not taken based on any of the contents of this website. The above content DOES NOT create an attorney-client relationship. KAASS LAW does not represent you unless you have expressly retained KAASS LAW in person at the KAASS LAW office. KAASS LAW helps clients in: Los Angeles, Burbank, Hollywood, Glendale, Van Nuys, North Hollywood, Studio City, Highland Park, Eagle Rock, Sunland, Tujunga, Sylmar, San Bernardino, La Crescenta, La Canada, Beverly Hills, Westwood, Santa Monica, Brentwood. Pacoima, Montebello, Commerce, Alhambra, Downey, Bell, Maywood, Walnut Park, Vernon, Lynwood, Echo Park, Silverlake, Mission Hills, Northridge, Woodland Hills, Encino, Canoga Park, North Hills, Porter Ranch, Chatsworth, Reseda.