AdobeStock_2054551287-300x200Starting a new business is an exciting journey, but the most challenging aspect of any new endeavor is where to get the money to start. Often, this is the greatest question that entrepreneurs face in starting and growing their businesses and it’s a decision that can have significant consequences. Oregon startups have various funding options available, though selecting the right one requires research, planning, and often advice of counsel.

While there are many different iterations, the primary decision an entrepreneur has to make is whether they want to raise money through investment – that is to say selling equity in the business – or whether they prefer debt, or even a combination of the two. Below, we highlight some of the most common funding choices. We invite you to contact Structure Law Group with any questions about Oregon startups and business financing.

Raising Money by Selling Equity

AdobeStock_2008905945-300x200Entrepreneurs often have questions about which business entity to choose when starting out. There are essentially two choices to make.

State Level Decisions: LLCs vs. Corporations

The first decision is which type of entity is best at the state level. Here, the most common options are limited liability companies (LLCs), or state registered Corporations. In both cases, the filings to establish or “form” the entity are made with the Secretary of State within the state of incorporation depending upon where the company wishes to formally register. Forming either entity is a first step for business owners limiting their liability in the company in order to ensure the company owners private, individually owned assets are shielded from lawsuits against the company. This is the main purpose of filing corporations or LLCs at the state level.

AdobeStock_272681272-300x200Private offerings provide startups and growing businesses with a viable avenue for raising capital, but these transactions remain subject to federal and state securities laws. Companies that misunderstand or overlook applicable compliance requirements may create unnecessary legal and operational risks.

Structure Law Group’s Los Angeles startup and financing lawyers advise startups, founders, and emerging businesses on private capital raises, securities compliance, and financing transactions. Understanding the most common legal mistakes in private offerings can help companies structure fundraising efforts more effectively and reduce the risk of regulatory issues that could affect future growth.

What Is a Private Offering in California?

AdobeStock_631393686-300x200Engaging in the purchase or sale of a business in Oregon involves certain reporting obligations. Ensuring compliance not only alleviates potential stress but also helps prevent legal liabilities resulting from improper transaction handling. Contact the Oregon business attorneys at Structure Law Group, LLC, for expert guidance regarding Oregon mergers and acquisitions. With extensive experience assisting numerous businesses from startup to sale, we streamline the process of buying and selling business assets for greater efficiency.

A Business Must Be in Good Standing Before Transferring Ownership

Businesses must be registered with the Oregon Secretary of State. All annual reports must be current and all fees paid. If you are selling, double-check that you are in good standing to help you close the sale faster. If you purchase a business, then this is part of your due diligence.

AdobeStock_2040656487-1-300x168A Letter of Intent (LOI) should set out the key terms of an acquisition before the parties negotiate the final agreement. Although these letters are typically non-binding, business owners should give careful consideration to terms beyond the purchase price. A poorly drafted LOI can slow negotiations and weaken a business’s position if a legal dispute arises. Call Structure Law Group, LLP, to speak with a Silicon Valley mergers and acquisitions lawyer about drafting a Letter of Intent.

M&A Letters of Intent: Critical Terms Beyond Purchase Price

In addition to identifying the parties, a Letter of Intent should include:

AdobeStock_1519492899-300x128A shareholder agreement provides a basic framework for how a corporation will be run. Although all corporations should have a shareholder agreement, it is especially important for closely held corporations where there is most likely a majority shareholder. If your business is forming a corporation, our Los Angeles corporation lawyers can review any agreement you have drafted yourself, or we can create a full shareholder agreement tailored to your needs.

What to Include in a Shareholder Agreement

A shareholder agreement safeguards the interests of both majority and minority shareholders. It also offers a clear framework for the smooth and efficient management of the corporation, which can boost its value and make it more attractive to potential employees. As a result, both majority and minority shareholders benefit.

AdobeStock_1781449466-300x155In most mergers and acquisitions, buyers choose between acquiring the target company’s assets or purchasing its stock. Each approach carries different implications for liability exposure, contract rights, tax treatment, and post-closing integration. Business owners and executives evaluating an acquisition should understand these distinctions before negotiating transaction terms.

Structure Law Group, LLP Los Angeles M&A attorneys advise buyers, sellers, founders, and investors on mergers and acquisitions throughout Los Angeles and California. The following overview examines key differences between asset purchases and stock purchases, including considerations that may influence risk allocation between the parties.

What Are the Differences Between an Asset Sale and a Stock Sale?

AdobeStock_125631308-300x200Disagreements among shareholders or LLC members can create significant operational challenges, particularly when the owners cannot reach consensus on important business decisions. Prolonged deadlock may delay strategic initiatives, affect management decisions, and create uncertainty for employees, investors, and other stakeholders.

To address these risks, many shareholder agreements and LLC operating agreements include deadlock provisions that establish procedures for resolving disputes and moving the business forward when owners reach an impasse. A corporation lawyer in Silicon Valley examines common deadlock mechanisms and the role they play in corporate governance.

CA Buy-Sell Agreements: Deadlock Clauses and Ownership Exit Options

AdobeStock_256179195-300x200Trade secrets are vulnerable whenever confidential information is shared with employees, contractors, or other personnel as part of day-to-day operations. Without clear internal policies and enforceable agreements, proprietary information may be disclosed, misused, or retained after an individual leaves the company.

Structure Law Group, LLP’s Los Angeles intellectual property lawyers advise businesses on legal strategies to protect trade secrets and other proprietary information, including the drafting employment agreements, confidentiality provisions, and internal policies designed to support enforcement under California law. The following are several practical measures companies should consider when evaluating trade secret protection.

Protecting Trade Secrets: Essential Safeguards

AdobeStock_2026150615-300x171Independent contractors generally retain ownership of the intellectual property they create unless an agreement provides otherwise. Therefore, businesses that engage contractors should address this issue at the outset to avoid uncertainty over ownership of work product developed during the engagement.

A well-drafted independent contractor agreement can establish that intellectual property created in connection with the contractor’s services is assigned to the company. The Silicon Valley intellectual property lawyers at Structure Law Group, LLP regularly advise businesses on drafting and negotiating independent contractor agreements that address intellectual property ownership and related protections. Below are several key provisions companies should consider addressing in these agreements.

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