Starting a company is not as simple as coming up with a name and declaring that you are in business.  You will need to follow proper legal process to form your business entity. Selecting the right type of business entity is an important first step.  Different business entities come with different types of governance, tax treatment, protection against personal liability and attractiveness to investors.

Most companies that plan to take outside investment elect to form as a corporation or limited liability company (LLC).  Corporations are subject to more statutory requirements and governance formalities than an LLC, but many investors are more comfortable (or even require) this form, and many employees are more familiar with the type of stock options that a corporation can offer.  Tax implications are also an important factor.  C-corporation profits are subject to double taxation (at the corporate level, and again as dividends at the individual level), but a qualifying corporation can elect to be treated like a partnership for tax purposes.  LLC profits and losses can “pass through” to members without double taxation.

Breakwater can help you select the business entity that makes the most sense for your company.  Whichever entity you choose, Breakwater will guide you through the process of forming your company, adopting appropriate governance documents and stockholder agreements, issuing founder equity, setting up an equity incentive plan, protecting your intellectual property and creating forms and processes to help your company comply with applicable laws and manage risk – helping you stay clean and fundable.

Capital Raising transactions

Money drives the growth of any business.  Breakwater advises both private and public companies in a wide range of capital raising transactions. 

After the initial startup stage, many businesses will need a cash infusion (from outside the founders’ pockets) to get to the next level.  Traditional startup funding options include bridge or equity financings from friends and family, angels or venture capitalists.  Other options include bank debt, crowd funding, government grants and cash or other resources from a strategic partner.

While investors write checks for teams and ideas that they like and believe in, it is their job to negotiate deals that will minimize their risk and maximize their potential profits. Breakwater will help you understand and negotiate the economics and control you are trading for investment dollars.

Bridge Debt Financing

A “bridge” financing can be a good option if your company needs a relatively small amount of capital to reach a milestone that will attract larger investment dollars and support a higher valuation.  Bridge financings are typically structured as debt that is convertible into equity.  The company will give the investor a promissory note obligating the company to repay the principal plus interest at a particular time, unless the amount is converted into stock sooner.  Conversion is usually triggered by a larger financing round where the angel investor or venture capital firm negotiates the share price.  Because bridge investors bear a higher risk by investing earlier, their money will usually convert at a discounted price.

Equity Financing

When investors purchase equity in your company, you will negotiate the valuation (what percentage of the company they will receive for their investment dollars) and the economic and control rights associated with the type of equity they are buying.  Investors will typically want a “preferred” series of equity that has a liquidation preference (meaning the investors get repaid before founders if the company liquidates or sells for a low value); price-based anti-dilution protection (meaning that if the company later sells stock for a lower price, they will get an effective price adjustment); and protective provisions (meaning certain actions will require their approval).  These rights and protections, as well as many other typical terms, come in a variety of flavors, some more company-favorable than others.

Public Company

We also advise public companies in registered primary and secondary offerings (rights offerings, shelf offerings, PIPEs, ATMs, equity lines) and in private placements. 

Public Company representation



We represent public companies of all sizes in 1933 and 1934 Act compliance and reporting matters, securities offerings, NYSE, Nasdaq and NYSE MKT compliance, corporate governance and related matters. 

We work closely with our public company clients to prepare 1934 Act reports (including Form 8-Ks, 10-Qs and 10-Ks), proxy statements and other filings made with the SEC. This allows us to advise on specific disclosure and compliance issues confronting our clients and to serve them in an efficient and effective manner.

We also advise our clients on:

  • preparing and reviewing 1933 Act registration statements;
  • developing and complying with insider trading policies;
  • reviewing drafts of quarterly earnings releases and investor presentations;
  • board of director and committee compliance matters;
  • beneficial ownership (Schedule 13D/G) and Section 16 (Forms 3, 4 and 5) reporting and compliance;
  • drafting confidential treatment, no-action and exemptive letter requests; and
  • handling shareholder proposals.




We regularly help  banks, financial services companies, fintech companies and investors navigate the regulatory maze to accomplish their objectives.  Whether a bank is considering a strategic transaction to maximize shareholder value or negotiating with a fintech company to provide key customers services, we can provide experienced, practical guidance.


Working with Regulators

The depth of knowledge and experience we offer is enhanced through the relationships we maintain with staff at federal and state regulatory authorities. These include especially the Federal Reserve, Office of the Comptroller of the Currency, FDIC and California Department of Business Oversight.  These relationships enhance our ability to handle immediate regulatory challenges, as well as ongoing compliance and disclosure responsibilities.

Critical Assistance

Clients call upon us for help on a wide range of matters involving everything from mergers and acquisitions to executive compensation.  Our key value-add is helping clients structure and manage their businesses so as to minimize potential regulatory issues.  If regulatory issues arise in the course of examinations or enforcement actions are imminent we help management sort through alternatives and maximize opportunities for favorable resolution.

Some of the areas in which we regularly assist are the following:

•    Acquisition of control of banks and holding companies
•    Acquisitions, dispositions and formation of banks and lending companies
•    Equity and subordinated debt offerings
•    Consent orders, including Bank Secrecy Act-related orders
•    Non-bank lender licensing and regulation
•    Fintech regulatory oversight and contracts
•    Insider transactions and stock ownership
•    Executive contracts
•    Equity compensation planning
•    Change in control arrangements

We advise boards of directors and shareholders in merger and acquisition transactions of all types and sizes. We appreciate that every transaction, regardless of size, is important. Our attorneys have advised on smaller deals involving the sale of specified assets, acqui-hires and public company takeovers. We have experience in asset deals, stock deals, reverse merger transactions, management buy-in transactions and restructurings.

Below is a list of some of the acquisitions our attorneys have worked on (some of which were handled at prior firms):

  • represented the owners of DB Studios, Inc. in the sale of the company to InnerWorkings, Inc. (NASDAQ: INWK)
  • represented Physicians Formula Holdings, Inc. (NASDAQ: FACE) in its sale to Markwins Int'l Corporation 
  • represented CACI International Inc (NYSE:CACI) in its acquisition of Paradigm Solutions, Inc. (OTCBB:PDHO)
  • represented, Inc. (NASDAQ:TREE) in its sale of Home Loan Center to Discover Bank
  • represented Rizvi Traverse in the take private transaction of Playboy Enterprises, Inc. (NYSE:PLAA)
  • represented the special committee of the board of directors of Tongjitang Chinese Medicines (NYSE:TCM) in the sale of the company
  • represented the special committee of the board of directors of Pomeroy IT Solutions (NASDAQ:PMRY) in the sale of the company

Mergers & Acquisitions


Breakwater represents a number of sophisticated venture investors, including individual angels and angel groups, family offices and venture funds.  We advise on individual investments and syndicated transactions.  We advise on direct investments into portfolio companies, as well as the acquisition of shares from private company shareholders in second market transactions.

We work closely with investors to develop investment strategies, structures and terms that reflect the investor’s unique goals and risk tolerance.  We assist with legal and IP due diligence, structuring and negotiating terms, drafting and reviewing investment documents and post-closing obligations.  Our expertise on both sides of the table allows us to aggressively negotiate deal structures and terms that protect investors, while maintaining alignment with founders so that the company can grow and succeed. 


investor representation

In today’s business environment, virtually any action you take can involve intellectual property rights.  This can cover anything from patents on products or special procedures to simple slogans.  Even if you have thought something up without any outside influence, you still cannot use it if someone else holds the intellectual property rights.  When you do come up with something that is truly original, you will want to keep your competitors from using it.

Intellectual Property

  • Trademarks cover things like company names, logos, and slogans. They are designed to protect consumers from confusion and prevent copycats from piggy backing off a successful brand.
  • Copyrights cover ideas such as songs, books, articles, and movies. With limited exceptions, any work is automatically copyrighted even if the formal copyright process is not followed.
  • Patents cover tangible things. This can include an entire product, a certain part, or a manufacturing process. A patented item cannot be used without permission even if you developed it completely independently.

Licensing & Monetizing IP

We can guide you in the creation, acquisition, use and commercial exploitation of your core technology and help you maximize the value of your strategic relationships. From alternative energy to digital media, e-commerce to electronics, and information technology to telecommunications, Breakwater attorneys understand business models and practices in all relevant industries and use their legal expertise and business savvy to help clients develop monetization paths at various stages of the company. Whether our clients are buying, selling, licensing or developing technology-based products or services, we help them attain successful business relationships while protecting their IP assets.

Breakwater attorneys combine the elements of an intellectual property practice with a commercial transactions practice, and are trained in best practices in these disciplines, enabling them to meet the demands of a fast-evolving, increasingly global environment. Some of the Breakwater attorneys are registered attorneys with the patent and trademark office, and all of them are expert deal-makers who have an aptitude for, and keen interest in, the technologies that help our clients thrive.


Hiring a team is an exciting step for any business.  However, it brings a new set of compliance responsibilities.  Companies should take care that their hiring practices and work environment comply with state and federal law.  You will need to know when and how to accommodate things like employees’ religious beliefs, illnesses, disabilities, and other special needs.  You will need to properly withhold taxes for both cash compensation and taxable benefits.  It is also important to properly classify employees versus independent contractors, as failing to do so may result in liability for back pay or unpaid taxes.

Companies should enter into written agreements with all service providers to establish agreed compensation and benefits and to protect company intellectual property and confidential information.  If a company is going to provide stock options or other equity incentives to its employees, it will need an incentive plan that complies with applicable securities regulations.  Establishing proper procedures and documentation for granting equity is essential to protect the company and individuals from unexpected tax implications.

Breakwater can work with you to establish employee onboarding procedures and documentation, including offer letters, proprietary information agreements, employee handbooks and equity incentive plans and agreements.

Breakwater also represents companies and executives in connection with the negotiation and preparation of executive officer employment agreements.

employment & Labor

In business, it’s both what you know and who you know. Breakwater attorneys have represented hundreds of corporate and investor clients with different backgrounds, goals, and business structures. This gives us a unique look at the big picture as well as first-hand experience with what has worked in the past and what hasn’t. It also lends itself to an extensive Rolodex of some of the most influential members of your community.

Strategic Advising

When determining future strategy, you need to take in the big picture of the current marketplace, past successes and failures, regulatory issues, and tax consequences. Business founders often get so caught up in their businesses that it is hard for them to step back and take an objective look at where they want to go. Our team has done hundreds of deals and seen a multitude of pitfalls and shortcuts.  As a strategic partner, our goal is to use our experience to help you move forward in a way that avoids costly mistakes along the way and to provide objective guidance to help grow your business for the long term.


Your company may have the best business idea along with the talented people to execute it, but sometimes execution also requires knowing the right people and/or infusing the right amount of capital from the right source. From obtaining financing to finding suppliers or distributors to signing on your first client, you have to be able to find the right person to make the deal happen. Our attorneys have worked with hundreds of clients in our decades of experience and can help steer you in the right direction. Whether it is one of our corporate or venture clients with complementary interests, a networking group, or a former classmate, we can help you find the right people to help your business grow.

strategic advising & introductions

Most people think of their attorneys in the context of lawsuits, drafting contracts, or closing a business deal. These are all valuable services, but hiring an attorney only when you think you need one provides two main disadvantages. First, the fee for a single transaction will often be higher because there is no ongoing relationship and the attorney will have to spend time learning about your company and what it is trying to accomplish. Second, not having an on-call attorney and needing to find an attorney creates an additional barrier to seeking legal advice that may lead your business to skip consulting with an attorney even when it would be in its best interests to do so.

When Outside General Counsel Services Might Be Needed

  • Review a contract proposed by a business partner
  • Draft standard contracts or leases
  • Attend board meetings
  • Questions about employment matters
  • Grant equity and maintain capitalization records
  • Discuss compliance issues surrounding new business proposals
  • Get early advice on circumstances that might lead to litigation

How General Counsel Services Work

When you sign up for our outside general counsel services, you pay a flat fee to have a dedicated on-call attorney available to you.  While he or she may be serving multiple businesses, your attorney will continue to work with you throughout the arrangement. Any time you have a quick question or just need a simple document reviewed, all you need to do is pick up the phone. When a more complex matter arises, you will have access to our firm’s full services led by the attorney who usually works with your business.

General Counsel Services