Los Angeles Outside General Counsel Services

What Is a Stock Warrant?

A stock warrant gives holders the option to buy company stock at a fixed price, the exercise price, until the expiration date and receive newly issued stock from the company. A stock warrant is similar to its better-known cousin, the stock option. For starters, recall that a stock option is a contract between two parties and gives the stockholder the right to buy or sell stocks at a certain price and on a certain date. When you buy a warrant, you are not locked in. You still have the right to freely decide to go forward with the purchase in the future.

Similarly, a stock warrant holder also has the right, to buy a specific number of shares of stock that will be created in the future, upon exercising the warrant, called “underlying” stock. That transaction is called “exercising” the option, and it must take place before a specific

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What Is Startup Valuation?

Startup valuation refers to the determination of a startup's worth, considering the market dynamics within its industry and sector.

These factors include the balance (or imbalance) between demand and supply of money, the size of recent events, the willingness of investors to pay premiums to invest in the company and the level of need the company has for money.

What Is a Startup?

A startup company is a new business which is potentially fast growing and aims to fill a hole in the marketplace by developing and offering a new and unique product, process or service but is still overcoming problems.

Startup companies need to receive various types of funding in order to rapidly develop a business from their initial business model that they can grow and build up.

Difference Between Startup Valuation and Mature Business Valuation

Startup businesses will usuall

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What Is an EB-5 Visa?

The EB-5 visa is an investment-based visa for foreign investors who are willing to create at least 10 jobs in the United States and contribute at least $500,000 (in a regional center) or $1 million (in any location in the United States) toward creating a new U.S. business. Congress introduced the EB-5 program to attract foreign investment, increase job creation, and stimulate the U.S. economy.

The EB-5 visa allows foreign citizens to gain a Green Card immediately after entry to the United States for themselves and their accompanying family members. The main condition of being accepted for an EB-5 visa is to make an at-risk investment into a business that directly or indirectly contributes toward creating U.S. jobs. The minimum investment is $1 million, but the amount is reduced to $500,000 for "targeted

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Updated June 19, 2020:

What Are SAFE Notes?

SAFE (simple agreement for future equity) notes are a simpler alternative to convertible notes. They were created in 2013 by Y Combinator, a Silicon Valley accelerator, and allow startups to structure seed investments without interest rates or maturity dates. SAFEs are short five-page documents. The valuation caps are the only negotiable detail.

A SAFE note is a convertible security that, like an option or warrant, allows the investor to buy shares in a future priced round. It addresses many of the drawbacks and challenges posed by convertible notes and can be an equitable option for investors and founders. Startups may prefer SAFE notes because, unlike convertible notes, they are not debt and therefore do not accrue inte

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