West Covina Contract Attorneys & Lawyers

Corporations are the basic and traditional business entity in this and many other countries. Unless a corporation can qualify for what is called ‘pass through’ treatment by electing to be taxed under a part of the Internal Revenue Code called Subchapter S , a corporation is taxed similarly to the way an individual is taxed. Being subject to the default tax treatment is what makes a corporation a “C Corp;” being able to qualify for pass-through treatment, and actually making an election to do so, makes a corporation an “S Corp.” They are the same type of business entity, taxed dif

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Updated July 8, 2020:

Phantom Stock: What Is It?

Phantom stock is an employee benefit where selected employees receive benefits of stock ownership without the company giving them actual stock. It is worth money just like real stock, and its value rises and falls with the company's actual stock (or what the company is valued at, if it's not a publicly traded company). Employees are paid out profits at the end of a pre-determined length of time.

Also known as shadow stock, simulated stock, or phantom shares, phantom stock is provided as a bonus for hard work and longevity. One form of phantom stock is Stock Appreciation Rights.

There isn't one exact definition of what phantom stock is or how companies use it. The term can apply to any reward that takes time to mature. Usually, the award is for a specific number of units, or phantom shares, that fo

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Updated October 26, 2020

What Is a Contract?

A contract is a legal agreement between two or more parties. A business contract includes the following:

• Names of all parties
• Contract beginning and end dates
• Payment amounts and schedule
• Steps to take when a party breaks the contract
• Signature with date

Business Contracts: What Are They?

Also known as a contractual business relationship or an agreement, a contract describes expectations for an interaction. It ensures all parties agree to the terms of their relationship.

A contract should include:

• Offer: One party makes the offer, and the other accepts it.
• Exchange: This includes money, goods, and services.

Why Are Contracts

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Updated June 23, 2020:

Intellectual Property Protection

Intellectual Property Protection is protection for inventions, literary and artistic works, symbols, names, and images created by the mind. Learn how you can protect your intellectual property by using: Patents, Trademarks, Trade Secrets, and Copyrights.

Intellectual Property Protection Explained

Entrepreneurs and business owners need to understand the basics of intellectual property (IP) law to best protect their hard-earned creations and ideas from unfair competition. Intellectual property includes distinctive items that you have created and ones that give you an economic benefit.

Seek professional experience from an

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In financial terms, pro-rata rights allow an investor to maintain their portion of ownership in a company when the company takes on new investors.

Company Valuation and Pro-Rata Rights

It is important to understand the role that the valuation of your business has on pro-rata rights for other investors. This is important because the angel or venture capital investor dilutes the shares of other owners. Other owners in early-stage businesses are typically the owner (or owners) and friends and family members. Initially your company may look like this:

• Owners/Founders - 50 percent equity each
• Friend and family investors – each owner/founder surrenders 5 percent and 10 percent is given to friends and family (founders/co-owners now have 45 percent each)

At this point, you will typically have registered your company with stock to ensure you can actually issue stock to family or fr

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