IDCEE 2013Kiev, Ukraine

101 LEGAL GUIDE FOR STARTUPS

11 October 2013

Michał Karwacki

101 LEGAL GUIDE FOR STARTUPSContents

• About Dentons

• Startup life cycle

• P.O.P.E.

• Planning (concept)

• Organization (incorporation)

• Positioning (operations)

• Exit (sale)

• Summary

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Meet DentonsA global law firm established in March 2013 by a combination of Salans, FMC and SNR Denton

2500 lawyers and professionals in 79 locations across 52 countries

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101 LEGAL GUIDE FOR STARTUPSPlanning

• Your concept (barrier of entry, how „unique” factor, how to monetize the concept)

• Costs and funding

• Business plan

• Feedback from others

• How advisors can help

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101 LEGAL GUIDE FOR STARTUPSIncorporation (available structures)

• Pros and cons• Liability issues

• Raising capital

• Tax issues

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Sole Proprietorship Partnership Corporation

Difficulty to Establish Low Medium Relatively high

Availability of Startup Capital Low Medium High

Control You are the decision-maker Need to share – SHA Depends on the type of corporation

Ability to Terminate n/a Medium Medium

Tax Liability You are solely responsible Reponsibility shared Limited liability

Corporate Regulation Low Medium High

101 LEGAL GUIDE FOR STARTUPSOperations - commercial (1)

• Services and sales• Internet site

• Contracting with customers

• General terms

• Personnel relations• NDA

• IP rights (employment vs. civil law contract)

• IP protection• Trademark

• Patents

• Confidentiality and trade secrets

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101 LEGAL GUIDE FOR STARTUPSOperations - funding (2)

• Funding• Investment term sheet (HoT, TS,

LoI)

• Minority rights protection

• Supervisory board

• Anti-dilution

• Reserved matters

• Restrictions on sale of shares (lockup, drag along, tag along, call option, put option)

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101 LEGAL GUIDE FOR STARTUPSExit

• Exit• Resale to Founders / MBO

• Private sale or auction sale to the strategic investor or PE House

• IPO

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101 LEGAL GUIDE FOR STARTUPSSummary

• Summary

• Initial stage

• Organization stage

• Operations

• Exits

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Key contacts

Michał KarwackiCounsel, Venture Capital and Private Equity Group

T: +48 22 24 25 659F: +48 22 24 25 242michal.karwacki@dentons.com Rondo ONZ 1, 00-124 Warsaw, Poland

© 2013 Dentons

Dentons is a global legal practice providing client services worldwide through its member firms and affiliates. This publication is not designed to provide legal or other advice and you should not take, or refrain from taking, action based on its content. Please see dentons.com for Legal Notices.

Igor OstrowskiPartner, Head of IP, Technology & Communications Practice Group in Poland and CEE

T: +48 22 24 25 673F: +48 22 24 25 242igor.ostrowski@dentons.com Rondo ONZ 1, 00-124 Warsaw, Poland

Victor NaumovPartner, Head of IP, IT & Telecomunications Practice Group in Russia

T: +7 812 325 84 44F: +7 812 325 84 54victor.naumov@dentons.com Moika Embankment 36, 191186 St. Petersburg, Russian Federation

Natalia SelyakovaPartner

T: +380 44 494 47 74F: +380 44 494 19 91natalia.selyakova@dentons.com Volodymyrska Str. 49-A, 01001 Kyiv, Ukraine