What to Include in a Fee Agreement for Forming a Corporation

If you represent clients in forming a California corporation, you should have a fee agreement that is specifically tailored for that type of work. Here are the necessary provisions to include. Continue reading

What Are Directors’ Fiduciary Duties When Selling Control of a Corporation?

In Delaware, courts impose the so-called Revlon duty, which can be described as the fiduciary duty to make reasonable efforts to obtain the highest sales price reasonably possible in view of the market for the company. This may even involve conducting a public auction for the company or at least a check of the market, depending on the circumstances, and agreements must include a so-called “fiduciary out” to allow the directors to accept a higher bid after the agreement has been signed by a would-be buyer. See Revlon Inc. v MacAndrews & Forbes Holdings, Inc. (Del 1985) 506 A2d 173; Omnicare, Inc. v NCS Healthcare, Inc. (Del 2003) 818 A2d 914. But, as Keith Paul Bishop notes in his recent blog post on California Corporate and Securities Law, “[d]espite its notoriety in Delaware, Revlon is nearly unknown in California jurisprudence.” Continue reading

How to Keep Contracts Out of Court (Part 2)

The key to keeping contracts out of the courtroom is drafting them well and making sure that they accurately capture the parties’ intent. In Part 1 of this post, we discussed five common contract drafting mistakes and how to avoid them. Here are five more. Continue reading

How to Keep Contracts Out of Court (Part 1)

The only contracts that see the inside of a courtroom are those that are poorly drafted or don’t accurately capture the parties’ intent. Here are five contract drafting mistakes and how to avoid them. Continue reading

4 Ways to Help Witnesses Maintain Credibility

When it comes to testifying, the first and most fundamental rule is to tell the truth. In addition to the obvious reasons, it’s hard to trick or trap someone who’s telling the truth about everything. But sometimes witnesses are afraid to admit to mistakes or biases and inadvertently appear less than honest.  Continue reading

Don’t Get Tripped Up on Contract Cross-References

When drafting a contract, it’s often necessary and useful to use cross-references to another part of the contract or a related document. This cuts down on redundancy and helps with consistency. But imprecise or problematic cross-references can make a mess of things. Here are some tips for handling internal and external cross-references. Continue reading

The Pros and Cons of IP Licenses

175660493Does your client need to acquire rights to certain intellectual property (IP), e.g., someone else’s invention or copyrighted work? Licensing IP, rather than purchasing, can be advantageous in many circumstances, but there can be drawbacks as well. Before advising a client to enter into an IP license agreement, consider whether it makes sense given the client’s business needs.

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