Formation Issues

Catch-Up Distributions For Profits Interests

In an earlier post, I talked about the 4 basic forms of equity (or equity-type) compensation that Limited Liability...

Seed Round Financing: Convertible Note vs. Series A Preferred Stock

Convertible debt and preferred equity are among the most common forms of investment structures used in early stage companies....

What Is A Management Rights Letter And Why Do Venture Funds Ask For Them?

When investing in startups venture capital funds often request what is known as a management rights letter. This letter...

What is an 83(b) Election and when should I make one?

Section 83 of the Internal Revenue Code applies to various forms of deferred compensation, including equity compensation such as...

Equity Incentives for LLCs and Partnerships

I.  Introduction Limited Liability Companies and partnerships (both referred to here as “LLCs”) can issue 4 basic forms of equity...