What are “Copyrights” ?

A Copyright is an exclusive right that stands for the creator or owner of a work, and prohibits others from committing forbidden actions in that work without the explicit permission of the creator or the owner. In Israel, copyrights are granted automatically and do not require registration. The validity duration of [...]

By | 2016-11-04T16:56:01+00:00 October 15th, 2016|Legal Definitions|0 Comments

What is a “Patent” ?

Patent is one of the possible protections for Intellectual Property. It is a temporary and territorial exclusive right that a person is granted by law, for technological, innovative, industrially applicable invention that has an "inventive step", regardless if the invention has been produced or not. In return for acquiring the patent [...]

By | 2016-11-04T16:56:02+00:00 October 15th, 2016|Legal Definitions|0 Comments

What are “Phantom Shares” ?

Despite its misleading name, phantom shares are not real shares in the classic sense of the term. This type of shares is usually meant for employees and it entitles its owner to receive an amount of money on a certain date or under defined preconditions (for example, when [...]

By | 2016-11-04T16:56:02+00:00 October 15th, 2016|Legal Definitions|0 Comments

What is an “owner loan”?

Owner loans are loans given to the company by shareholders/office holders. The terms of the loan usually are determined in a founder's agreement or owner loan's agreement. Owner loans unlike investments are always a long-term liability. These particular loans are flexible compared to other loans. For example, many shareholder's offer to [...]

By | 2016-11-04T16:56:03+00:00 October 15th, 2016|Legal Definitions|0 Comments

What are “preference shares”?

Companies can offer preference shares with different rights and any combination of features. Preference shares offer investors another layer of protection. For example, if a company have financial problems, preference shares have the priority to claim on the assets of the company. In addition, preference shares offer greater income security when [...]

By | 2016-11-04T16:56:04+00:00 October 15th, 2016|Legal Definitions|0 Comments

What is a “Preemptive Right”?

A preemptive right is granted to shareholders under agreements such as Share Purchase Agreement, Investment Agreement, and Shareholder's Agreement etc. This right allows shareholders to purchase additional shares in the company before offering the shares to third parties. A preemptive right prevents dilution. For example, two shareholders have equal parts in a company. [...]

By | 2016-11-04T16:56:07+00:00 October 15th, 2016|Legal Definitions|0 Comments

What is a “Buy Me Buy You” mechanism?

BMBY is a mechanism that separate shareholders in case of disagreements and deadlocks. Mechanisms such as BMBY can be prescribed in contracts between shareholders like founder's agreement and cooperation agreement etc. According to BMBY mechanism, one of the founders (A) can make an offer on his partner's (B) shares. Founder B [...]

By | 2016-11-04T16:56:07+00:00 October 15th, 2016|Legal Definitions|0 Comments

What is the “General Meeting”?

According to the Israel company law, a general meeting is "an annual meeting or an extraordinary meeting of shareholders". The annual general meeting is a mandatory for public companies. Article 57 of the Israel company law conferred exclusive powers on the general meeting, such as resolutions in respect of alterations in [...]

By | 2016-11-04T16:56:07+00:00 October 15th, 2016|Legal Definitions|0 Comments

What is the “Right of first offer?”

A contractual obligation between an owner of an asset and a rights holder, in which the first will offer the asset for sale primarily to the latter, before offering it to third parties. If the rights holder do not want to purchase the asset or unable to agree with the seller [...]

By | 2016-11-04T16:56:08+00:00 October 15th, 2016|Legal Definitions|0 Comments

What is the “Right of first refusal”

A contract right, which gives its holder the option to make a deal with the owner of an asset, before anyone else can. The parties will also regulate in the contract the terms in case of transference, breach of the right etc. For example: Dina and Yossi are the owners of a company. [...]

By | 2016-11-04T16:56:08+00:00 October 15th, 2016|Legal Definitions|0 Comments
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