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Moisan Legal P.C. Blog

Thursday, May 1, 2014

Moisan Legal client performs at the Guggenheim Museum, NYC.

Congratulations to Moisan Legal clients for their successful production at the Guggenheim Museum, NYC.  Find out more here.


Thursday, April 17, 2014

Crowdfinancing - Statistics Part II

The top 5 States by capital committed (during the time period of September 2013 through February 2014) are:

1.  California 
2.  New York
3.  Oklahoma
4.  Texas
5.  Florida


Read more . . .


Tuesday, April 1, 2014

Option Strike Price - The Basics

The option strike price is the agreed upon price of the shares offered in an option.  When a person chooses to exercise their right to an option they will pay the strike price for each share.  The inherent value of an option is the expectation that the strike price will be lower than the real value of the shares when the option is exercised. 


Read more . . .


Thursday, March 27, 2014

Crowdfinancing - Statistics

According to a very interesting study published by Crowdnetic (http://www.crowdnetic.com/reports/feb-2014-report), there are approximately 2,500 private issuers publicly raising capital.  Of these issuers, 32% are in the technology sector, and 43% are in the services sector.   These sectors have accounted for 24% and 37%, respectively, of the total capital committed.   Interestingly, the financial sector accounts for 20% of the capital committed but only 5% of the number of active issuers.  The financial sector also has the highest average amount of capital committed ($1,000,000) by issuer's successful raising capital.  In contrast, the average for all other sectors is approximately $300,000.

The top ten industries by capital commitments across all sectors are:


Read more . . .


Saturday, March 15, 2014

Liquidation Preference - The Basics

Typically a liquidation preference gives the venture capital (VC) investor a “first right” to a portion of the proceeds available to shareholders in the event of a liquidation or sale of the company.   This right is manifested in the terms of their preferred stock and set forth in the formation documents of the entity.   Ah, preferred stock … As you probably know, in most startups there are at least two classes of stock, common and preferred.  Founders and employees typically own common stock while VC investors typically own preferred stock.  While this can get very complicated, it is often helpful to think of common stock as “sweat equity” and preferred stock as “cash equity”.   


Read more . . .


Tuesday, March 11, 2014

Moisan Legal P.C. client Ruckus Marketing purchases Neuweiler Brewery.

Moisan Legal P.C. attorneys advised client Ruckus Marketing in its recent purchase of the property previously occupied by Neuweiler Brewery.   

 


Saturday, March 1, 2014

Stock Options - The Basics

An option is a privilege, sold by one party to another, which gives the buyer (the option holder) the right, but not the obligation, to buy or sell a stock at an agreed-upon price (i.e. the set or strike price) within a certain period or on a specific date.  In the world of startups options are typically offered to employees as part of their compensation package.  That option gives the employee the opportunity to purchase stock at a price lower than the market value of that stock.  However, employees must typically wait a specified vesting period before being allowed to exercise (or buy) the option.


Read more . . .


Friday, February 28, 2014

Dilution - The Basics

Most successful founders and early owners of startups will experience dilution.  Dilution is a reduction in the ownership percentage of a share of stock caused by the issuance of new stock.  Dilution can also occur when holders of stock options (e.g., employee equity holders) or holders of other optionable securities exercise their options. When the number of shares outstanding increases each existing stockholder will own a smaller (i.e. diluted) percentage of the company.   Dilution is often misunderstood in part due to the simple fact that it is an emotional moment in a founder’s existence – it is important to remember, a lesser percentage of something is better than 100% of nothing.


Read more . . .


Wednesday, February 19, 2014

Moisan Legal P.C. client performs in Budapest!

Congratulations to Moisan Legal clients on their amazing show in Budapest.  A video can be seen here.  



Saturday, February 15, 2014

Employee Equity - The Basics

When people talk about being employed by a start-up company they often talk about “getting in on the ground floor.”  In other words, one allure of employment at a start-up is the ability to see it develop and grow.  As a start-up, how do you leverage this potential opportunity and minimize your cash outlaw?  You have just entered into the world of employee equity or, in other words, offering an employee an ownership stake in the company.  Stated simply, employee equity is the primary tool utilized by start-ups to attract and retain talent.  Equally as important, offering employee equity reinforces a core tenet of startup culture: commitment to the team and the team’s commitment to employees.


Read more . . .


Monday, January 27, 2014

The importance of properly documenting the issuance of stock.

In December 2013, the Delaware Chancery Court rendered a decision highlighting the importance of properly documenting the issuance of stock.  Read on to learn what this means and why it is important.


Read more . . .


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