Recorded 6/20/23 Moving an international company to the U.S. can be a challenging process with many pitfalls. This video is designed to help tech startups understand some of the legal decisions that need to be taken into consideration when expanding your company to the U.S. The speakers discuss: 1. Why many startup founders want to bring their company to the U.S. 2. When is a good time to start the process? 3. What is an appropriate legal structure for U.S. operations or funding in the U.S.? 4. What are the typical rounds of raising capital in the U.S.? 5. What are the most common mistakes founders make during the early stages of their startup (taxation, IP, immigration, insurance, compliance)? About the Speakers: Svetlana Kamyshanskaya, the founder of Primum Law Group, is a global citizen with the legal, operational, and project management expertise to chart a successful course for expanding inbound tech companies and startups. Svetlana works with entrepreneurs and executives at all stages of development. She has personalized her clients’ road maps for bringing their business to the U.S. Elina Firsava is a corporate attorney at Primum Law Group where her practice focuses on helping international and domestic companies to incorporate and develop their business in the United States. She assists startups with their general corporate matters, including entity formation and reorganization.

1. Taking Your
Company to the US
Primum Law Group
Webinar
Idea to IPO
http://www.primumlaw.com

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Timing, perseverance, and ten years of trying will eventually make
you look like an overnight success.
– Biz Stone, Twitter co-founder

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Why may startup founders want to bring
their company to the US?
Expand the market
Find the exit
Raise capital
All of the above
• to grow business in Silicon
Valley;
• to get access to the unique
talent
• Networking opportunities
• to share the ideas
• to plan the exit
strategy and sell the
business
• to sell your
product on US
market

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Form of Legal Presence in the US
Understanding why the
companies want to expand into
the US
Understand the balance of
flexibility, risk and the amount
of control they want to maintain
while achieving their goals
Understand and tax and potentially
immigration implication of the
specific structure

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Corporate Planning
The most common types of
domestic business entities
are corporations, limited
liability companies (LLCs)
and partnerships.
Each business form has its
own benefits and the
choice of one depends on
case-specific legal and
business factors.

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Raise capital
Knowing how to raise capital can often mean the difference
between success and failure
1. Friends, family, and fools.
2. Crowdfunding.
3. Angel investments.
4. Venture capitalists.
5. Business loans.

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What are the typical rounds of raising
capital in the US?
Startup companies may go through several funding rounds:
pre-seed, seed, series A, series B, and series C. After that,
they can reach an IPO and be listed on the public stock
exchange so any investors can contribute to raising capital.
PRE-SEED
is the stage typically refers to the period in which a company's founders are
first getting their operations off the ground. The most common "pre-seed"
funders are the founders themselves, as well as close friends, supporters and
family.
SEED
is the first official equity funding stage. It typically represents the first official
money that a business venture or enterprise raises. Seed funding helps a
company to finance its first steps, including things like market research and
product development. Seed funding is used to employ a founding team to
complete these tasks

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What are the typical rounds of raising
capital in the US?
SERIES A
in this round, it’s important to have a plan for developing a business model
that will generate long-term profit. In Series A funding, investors are not
just looking for great ideas. Rather, they are looking for companies with
great ideas as well as a strong strategy for turning that idea into a
successful, money-making business. Typically, Series A rounds raise
approximately $2 million to $15 million. In 2021, the median Series A
funding was $10 million.
SERIES B
This round is similar to Series A in terms of the processes and key
players. Companies undergoing a Series B funding round are well-
established, and their valuations tend to reflect that; most Series B
companies have valuations between around $30 million and $60
million.
SERIES C
Series C funding is focused on scaling the company, growing as
quickly and as successfully as possible. Most commonly, a company
will end its external equity funding with Series C.

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Immigration
• Transferring employees (specialist staff; executive
management) from the home market to the US
• All foreigners coming to the US to work must obtain
permission to do so in the form of a visa
• It is critical for foreign business owners and their workers to
adhere to the terms of their particular visa as any violation
can result in removal from the US or denial of re-entry into
the US.

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Taxation
► Careful tax planning and counsel
is important for all companies
doing business in the US.
► Companies in the US are subject
to separate federal, state, and
local taxes.
• The US is party to bilateral tax treaties with numerous foreign
countries.
• These treaties have significant differences among them, but all of them
aim to facilitate commerce between countries while preventing double
taxation and tax evasion
Tax Treaties
01
Controlled Foreign Corporation
02
Corporate Income Tax
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Transfer Pricing
04
Individual/Expatriate Income Tax
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• The Controlled Foreign Corporation (CFC) rules were created and are
managed by the Internal Revenue Service – which manages such CFCs’
taxation within rules designed to limit artificial deferral of tax by using
offshore low taxed entities.
• A corporation formed in the US is subject to federal income taxes on all
of its income – meaning income earned anywhere in the world.
• Companies in certain sectors may also be eligible for tax credits, which
are often used to incentivize investment in emerging industries like
renewable energy. Tax credits are particularly valuable compared to
deductions because they reduce a company’s tax bill dollar-for-dollar.
• Foreign companies doing business in the US may not shift profits to a
foreign parent company to avoid taxes.
• Individuals that are US citizens or US resident aliens are subject to tax
on their worldwide income, regardless of where they work or live.

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Intellectual Property
► There are four
primary forms of
intellectual property
in the US: patents,
copyrights,
trademarks, and
trade secrets.
► When technology
companies consider
international
expansion, it is the
IP strategy which is
very important to
get right.
• A foreign company introducing a unique product into the US market
may be able to obtain protection for its invention by securing a US
patent, provided that the invention has not been marketed or sold in
another country.
• The Madrid Protocol makes it easier to register a trademark in
multiple countries.
• Under the Paris Convention of 1883, trademark filings in a signatory
country that are made within six months of filing in another signatory
country are treated as if filed on the date of the original filing.
• Copyright protection is available for literary, musical, architectural,
artistic, graphic, sound recordings, and other works that are written
down or otherwise fixed in a tangible medium.
• Copyright protection is automatically secured when the author creates
the work—registration is not required for protection.
Regarding Trademarks
Copyrights
Trade Secrets
• A trade secret is any information that adds value to a business or
provides a competitive advantage to the owner because the
information is not known by others.

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Labor and Employment
• Foreign businesses coming to the United States
must comply with US labor laws when hiring
employees (US citizens or legal residents) who will
be working in the US.
• US laws notably distinguish between ‘employees’
and ‘independent contractors’. Employees are
subject to tax withholding requirements and
protected by federal labor laws.
• Companies doing business in the US need to be
aware of these distinctions and accurately classify
workers. If a government agency or court
determines a worker is actually an employee
rather than an independent contractor, the
employer can be liable for back taxes and civil
claims under labor laws.
• US employment contracts may set the scope and
term of employment and the conditions under
which the parties can terminate the relationship.

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Product Liability
US product liability laws differ
greatly from product liability laws
in other countries. Unlike many
other countries, a majority of US
states have adopted the doctrine
of strict liability in tort.
The adoption of strict liability
expands the scope of entities that
can be liable for product injuries
and lessens the proof necessary to
establish such liability. Under
strict liability, a company
anywhere in the production chain
(manufacturers, wholesale
distributors, retailers) can be liable
if they sell a product in a defective
condition that is ‘unreasonably
dangerous’ to the user
In addition to negotiating
indemnification and defense
clauses, foreign companies doing
business in the US should consider
carrying adequate insurance
coverage to protect against
product liability claims.

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Conclusion
• This is only a ‘big picture’ presentation
of the process of expanding your
business operations into the United
States.
• There are many advantages and
benefits to business expansion outside
your own borders, but make sure you
are guided by an experienced team of
professionals to smooth the way and
save you time, energy and money…and
allow your business to launch, sell and
profit more quickly.
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Primum Law Group is
A boutique law firm based in San Francisco that specializes in advising
and representing international companies of all sizes and operating in
all industries which are exploring how to take advantage of business
opportunities offered by the US economy.
Our expertise focuses on the exercise of international multi-faceted and
complex business planning.
The process has to extend beyond merely identifying new markets for
the products and services of the company.

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PRIMUM PROVEN PROCESS

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Your company has been domestic-focused and now needs to identify how it can
obtain the resources needed in order to implement a global strategy.
You also need to identify the potential risks involved in the process and the
ways you can best mitigate them
We walk you through a series of
essential analytical questions.
We clarify the potential legal issues
that have to be taken into account
in relation to your planned
expansion.
We help you strategize the steps of this
expansion by designing and
implementing efficient, cost-effective
legal structures and business operating
models that get your business where
you want it to be.
The process includes getting clear
on your business goals, the
incorporation options, immigration
rules, taxation obligations,
intellectual property protections,
labor and employment laws,
product liability risk.

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Consultation with Primum Law Group
FIRST FIVE EMAILS THAT WE RECEIVE
WILL BE ELIGIBLE FOR A FREE 15-MIN
CONSULTATION

19. Q&A
Contact information
General: info@primumlaw.com
+1(415)293-8042
Svetlana Kamyshanskaya – svkam@primumlaw.com
Elina Firsava – ef@primumlaw.com