How to negotiate a document

by Rick Colosimo on May 19, 2015

This article gives some tips on how to negotiate a contract. While it’s aimed more at business people, it’s awfully close to what lawyers should do.

I think almost every document can be fixed in one round of changes, unless there are open business issues that were deliberately left open at the term sheet or LOI stage. Term sheets should not be skeletal – they should include the material deal terms as well as those common areas where deal folks, rather than lawyers, make the final call or that are commonly negotiated, such as a knowledge qualifier on an IP rep for a startup.

If you’re a startup, ask your lawyer about what you can do to speed the process along. As my friend Mike likes to say, “Time kills all deals.”

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CEO privilege

by Rick Colosimo on May 15, 2015

Many of my clients are founders and CEOs of their companies. Sometimes, they’re inexperienced in this role, regardless of how old they are or how much education they have.

One of my common themes for some of these folks is the “you’re the boss” speech. When you are the CEO, you are the captain of the ship. It is your privilege, right, and, yes, duty, to come up with a plan.

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How to backdate stock options

May 11, 2015

I’m sure that at least one securities litigation lawyer got a fever just from reading the title of this post. And that’s a good thing — you should all learn from it. Here’s the scenario: you intended to grant some options to a valued employee, but that was a few months ago, or maybe even […]

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Acclerating stock options

May 8, 2015

Someone recently asked me about stock options: How do they generally work when stock hasn’t vested and the company undergoes a change of control? Do the options immediately vest? Are they lost? The typical model is that the vested options are either exercised, net exercised, or paid as if net exercised. In short, they’re paid […]

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Using accounting terms in contracts

May 3, 2015

I recently came across a situation where we used “net revenue” in a bonus plan as part of the calculation to determine what the bonus pool would be. In other contracts, we’ve used “net revenue” to distinguish from “revenue” (aka gross revenue) to deduct things like discounts, credits, returns, and so on. In many of […]

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