Louis Wharton - Stubbs Alderton & Markiles, LLP

Stubbs Alderton & Markiles, LLP announced that it represented client IRIS.TV in its $18M Series B Funding round. IRIS.TV ingests millions of videos every day from the world's largest broadcasters, publishers, and content creators around the world. Each video is then analyzed and assigned hundreds of additional data segments to build a more comprehensive understanding of each individual video. These new data segments can be utilized for many solutions including video recommendations, analytics, insights, contextual video ad targeting, and the creation of additional first-party data. We believe the world's premium video content and journalism should be easier for users to discover and for marketers to target and align their messaging.

Louis Wharton: Louis Wharton is a Partner of the firm. Louis’ practice focuses on advising venture capital funds and angel networks, along with middle-market, emerging growth, early-stage and public companies in corporate finance, mergers and acquisitions, securities compliance and general corporate matters. Louis counsels clients in the technology, e-commerce, and digital media industries, among others.

Kelly Laffey: Kelly Siobhan Laffey is senior counsel of the firm and the Director of Business Affairs at the Preccelerator. Kelly’s practice focuses on advising emerging growth and middle market companies in the technology, digital, internet, fintech, interactive media (i.e., AR and VR), and entertainment industries. Kelly counsels clients on issues related to corporate governance and formation, venture capital and other financings, joint ventures, employee compensation, complex stockholder and operating agreements, securities law regulation and other general corporate matters. Kelly also advises investors and funds in connection with venture capital and other financings.

Daniel Garber: Daniel Garber is an Associate of the Firm. Daniel’s practice focuses on corporate transactions, including venture capital financings, mergers and acquisitions, securities law compliance, and other general corporate and business matters.

As a result of the Firm’s deep roots in the emerging growth market, Stubbs Alderton & Markiles understands the unique practical business needs of early-stage and high-growth companies. The Firm typically acts as outside general counsel to its emerging growth clients, including participating in board-level discussions and serving as an extension of the management team. The Firm strives to understand its clients’ business and markets and give them senior-level attention, which enables the Firm to provide practical and cost-effective legal advice. Representing private companies as they seek funding from venture capital firms, angel investors or other investors has been a key component of the Firm’s practice. The Firm also represents and has extensive relationships with the most prominent venture capital firms and angel investor groups in Southern California. The Firm has extensive experience in advising on a wide range of financing structures, including seed and angel investor financings, venture capital investments, private equity and other institutional financings, bridge loans, and PIPE transactions for public companies. The Firm’s representation of cutting-edge companies and leading investors allows it to stay apprised of developing market trends and, where appropriate, to make introductions to investors and companies.

Stubbs Alderton & Markiles client Embodied, the industry-leading robotics and AI company creating state-of-the-art companion robots to revolutionize human-centric care and wellness by enhancing quality of life for individuals and families, launches Moxie, an animate companion for children. Moxie is designed to help promote social, emotional, and cognitive development through everyday play-based learning and captivating content. Moxie is a robot with machine learning technology that allows it to perceive, process and respond to natural conversation, eye contact, facial expressions and other behavior as well as recognize and recall people, places, and things.

About Embodied, Inc.
Embodied, Inc.'s mission is to build socially and emotionally intelligent animate companions with believable personality and empathy to enhance our daily lives. Backed by a veteran team of technologists, neuroscientists, child development specialists, and creative storytellers, Embodied is rethinking and reimagining human-machine interaction. Through extensive research, they have developed a new platform, SocialX^™, that provides a way to use natural human interaction to engage with technology. The first iteration of this technology is Moxie, an animate companion for children developed to help promote social, emotional and cognitive learning. Follow along @embodiedinc on all social channels: Instagram, Facebook, Twitter, and Pinterest.

As COVID-19 continues to curtail economic activity, private companies granting equity-based incentive awards should consider whether the pandemic’s impact on their business warrants a new independent valuation of their equity securities.

As a reminder, with limited exceptions Section 409A of the Internal Revenue Code and its associated regulations (“Section 409A” and/or the “regulations”) require companies to issue equity-based incentive awards at fair market value (“FMV”) to avoid potentially significant tax penalties resulting from a determination that such awards constitute deferred compensation issued under non-qualified deferred compensation plans.

Determining FMV
Section 409A clarifies that a company may determine FMV for stock that is readily tradable on an established securities market (such as the NYSE or Nasdaq) by any reasonable method using actual transactions in such stock as reported by such market. However, determining FMV is more difficult for privately held companies, including early-stage companies, whose stocks are not freely transferrable and/or cannot be readily liquidated.

The regulations provide that such companies may determine FMV for their stock by the reasonable application of a reasonable valuation method, based on facts and circumstances existing as of the valuation date. Fortunately, the regulations also provide that the use of certain methods, including a valuation determined by an independent appraisal that meets the requirements of the regulations (a “409A valuation”), are presumed to be reasonable.

Impact of Material Events
Companies can generally rely on a 409A valuation for a period of 12 months after the valuation date. However, the use of such a valuation may not be reasonable if it fails to reflect information available after the date of the valuation that may materially affect the value of the company. The issue of a 409A valuation not accounting for a material event is more likely to arise when the material event increases the company’s value, since granting equity-based incentive awards at a price above FMV will not trigger the negative tax consequences associated with the issuance of deferred compensation under a nonqualified deferred compensation plan. Nevertheless, obtaining a new 409A valuation where a material event negatively impacts a company’s value merits review, at least from the perspective of the additional incremental value that may accrue to service providers who receive equity-based incentive awards. A lower valuation allows a company to issue options and other equity based compensation at a lower exercise price, meaning a greater potential upside for recipients.

Factors to Consider
While the recent decrease in the value of indices of publicly traded stocks appears to indicate that the COVID-19 pandemic has materially adversely impacted businesses overall, some businesses and sectors have increased in value. Each company must therefore determine how, and to what extent, the pandemic has impacted its value. Companies should consider the following in assessing the need for a new 409A valuation:

In addition, companies should consult with their 409A valuation provider, along with their tax, financial and legal advisors, to assist in their analysis. The cost of a 409A valuation is generally significantly less than the cost of a full appraisal but the potential benefits for incentive award recipients could be meaningful.

For more information or if you have questions about its effects on your business please contact our COVID-19 Task Force at or one of our attorneys at SA&M.

For a more in-depth discussion regarding the IRS’ rules and Section 409A, please see additional articles written by the Chair of our Firms Tax and Estate Planning Practice, Michael Shaff at .

Stubbs Alderton & Markiles’ client, OS National, a premier nationwide title insurance agency, announced this week that it has been acquired by Opendoor, which makes instant online offers to buy homes. The purchase allows Opendoor to integrate title, escrow and closings into its online buying and selling experience.

About OS National
OS National is building the premier nationwide title insurance agency. Founded on a deeply rooted passion to better serve their customers and their evolving needs, they are approaching title insurance differently – with the customer first. Keeping this at the forefront, they are able to define what OS National is, what they stand for, and how they will interact with you. And, it is simple. They are not your typical title company. OS National is redefining title services. Visit https://osnational.com.

Stubbs Alderton & Markiles’ client AllTrails, the most trusted and used digital guide to the outdoors, announced the acquisition of German-based outdoor recreation platform, GPSies. The deal further enhances AllTrails' trail coverage across Europe and cements its position as the most comprehensive global resource for outdoor recreation.

Stubbs Alderton & Markiles’ attorney representing AllTrails in this deal is Louis Wharton.

About AllTrails
AllTrails helps people explore the outdoors with the largest collection of detailed, hand-curated trail maps as well as trail reviews and photos crowdsourced from its community of over 11 million hikers, mountain bikers and trail runners. AllTrails has the #1 Outdoors app for iOS & Android with more than 14 million mobile downloads and reaches 46 million people each year through alltrails.com, the App Store and Google Play.

Stubbs Alderton & Markiles’ client AllTrails, the most trusted and used digital guide to the outdoors, announced this month its acquisition of pioneering platform for outdoor recreation, Trails.com. Terms of the transaction were not disclosed. Trails.com is AllTrails' third acquisition and strengthens its growing library of over 75 thousand hand-curated trail maps.

Stubbs Alderton & Markiles’ attorneys representing AllTrails in this deal are Louis Wharton and David Stoops.

Stubbs Alderton & Markiles’ client Kairos Ventures led a Series B investment round for Actuate Therapeutics, a clinical stage biopharmaceutical company, raising $21.7 Million. Also participating in this round were DEFTA Partners, Tech Coast Angels, and existing investor Bios Partners.

Stubbs Alderton & Markiles’ attorneys representing Kairos Ventures in this deal are Louis Wharton, Kelly Laffey, and David Stoops.

About Kairos Ventures
Kairos Ventures invests early, often during the formative stages of a company, and works closely with the world’s leading scientists to commercialize their technologies. Depending on the stage of development and the capital requirements of each venture, they make investments between $150,000 and $20 Million. While Kairos Ventures is hands-on they also recognize that it is the entrepreneurs’ sweat, hard work, and perseverance that will drive the growth of their companies. They strive to ensure that the founding team, who make the early sacrifices in pursuit of their venture, retain the majority of the ownership in their companies. In addition to providing early-stage capital, Kairos Ventures leverages their expertise and extensive network of professionals specializing in all disciplines required to build a successful company, including legal, finance, marketing, operations, business development, and HR. They provide these services to early-stage companies in their portfolio to allow the entrepreneurs to focus their energy on continuing to innovate and pushing the envelope in their respective fields.

Stubbs Alderton & Markiles’ client AllTrails, the most trusted and used digital guide to the outdoors, announced its acquisition of iFootpath, the #1 paid travel app in the UK. Terms of the transaction were not disclosed.

Stubbs Alderton & Markiles’ attorneys representing AllTrails in this deal are Louis Wharton and David Stoops.

For a company founder, it is easy to understand the benefits of providing stock or stock options to employees. It’s a way of compensating employees that doesn’t drain cash from the business. Employees will feel invested in the future success of the company. Join us to get insights and wisdom about maximizing opportunities and minimizing mistakes in creating equity compensation.

Louis A. Wharton is a partner of the firm and president of the Preccelerator Program. Louis’ practice focuses on advising venture capital funds and angel networks, along with early stage, emerging growth, middle market and public companies in corporate finance, securities compliance, mergers and acquisitions, and general corporate matters.

He counsels clients in the technology, e-commerce, digital media and entertainment industries, among others.

SAM Preccelerator
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Stubbs Alderton & Markiles’ client AllTrails, an online database of curated digital outdoor maps, has received a significant investment from Spectrum Equity, in connection with Spectrum’s acquisition of a majority stake in the Company, to help accelerate product development, add more trail content around the world and grow the Company’s user base. AllTrails was advised by Stubbs Alderton & Markiles while GP Bullhound served as financial adviser. Spectrum Equity was advised by Latham & Watkins. Financial terms of the transaction were not disclosed.

Stubbs Alderton & Markiles’ attorneys representing AllTrails in this deal are Louis Wharton, Marc Kenny, and Kelly Laffey.

ABOUT ALLTRAILS
AllTrails helps people explore the outdoors with the largest collection of detailed, hand-curated trail maps as well as trail reviews and photos crowdsourced from its community of over 9 million hikers, mountain bikers and trail runners. AllTrails has the #1 Outdoors app for iOS & Android with more than 12 million mobile downloads and reaches 44 million people each year through alltrails.com, the App Store and Google Play.

For more information about our Mergers and Acquisitions practice area contact Louis Wharton at [/vc_column_text][/vc_column][/vc_row]

Stubbs Alderton & Markiles client Starship Technologies, a company developing small self-driving robotic delivery vehicles, announced this week that they have raised an additional $25 million in seed funding and have appointed Lex Bayer as Chief Executive Officer. The round includes follow-on investments from existing investors including Matrix Partners and Morpheus Ventures. Additional investors include Airbnb co-founder Nathan Blecharczyk, Skype founding engineer Jaan Tallinn, and former chairman and CEO of Metro-Goldwyn-Mayer, Gary Barber.

To read the full press release visit here.

Stubbs Alderton attorney representing Starship Technologies is Louis Wharton.

About Starship Technologies
Starship Technologies is building a fleet of robots designed to deliver goods locally in 15-60 minutes. The delivery robots have traveled tens of thousands of miles, met millions of people and have been tested in over 100 cities around the world to date. They drive autonomously but are monitored by humans who can take over control at any time. Launched in July 2014, by two Skype co-founders, Ahti Heinla and Janus Friis, Starship is changing the way packages, groceries and food are delivered.
Visist www.starship.xyz

About Louis Wharton
Louis A. Wharton is a Partner of the Firm and Director of the Preccelerator Program. Louis’ practice focuses on advising startup, emerging growth and middle market companies across a spectrum of industries in securities compliance, corporate finance, mergers and acquisitions and general corporate matters. He counsels clients in the technology, internet/e-commerce, pharmaceutical, apparel and entertainment industries, among others. Louis serves as a member of the Board of Directors of the Los Angeles Venture Association (LAVA), and previously served on the San Fernando Valley Bar Association Board of Trustees and the Executive Committee of ProVisors’ Technology Group.

For more information about our Venture Capital and Emerging Growth Practice , contact Louis Wharton at

Stubbs Alderton & Markiles client Kairos Ventures led a Series A funding round for PolyCera Membranes raising $9 Million. This round of funding will enable PolyCera Membranes, which develops and markets next-generation membrane technology for industrial wastewater treatment and process separation, to make immediate investments to build out its global manufacturing, R&D and sales capabilities. The Series A funding round was led by Kairos Venture s with follow on capital provided by Bluestem Capital and the Wolfen Group – two of PolyCera’s existing investors through Water Planet.

Stubbs Alderton attorneys representing Kairos Ventures in this deal are Louis Wharton and Kelly Laffey.

About Kairos Ventures
Kairos Ventures invests early, often during the formative stages of a company, and work closely with the world’s leading scientists to commercialize their technologies. Depending on the stage of development and the capital requirements of each venture, they make investments between $150,000 and $20 Million. While KV are hands-on investors, they also recognize that it is the entrepreneurs’ sweat, hard work and perseverance that will drive the growth of their companies. They strive to ensure that the founding team, who make the early sacrifices in pursuit of their venture, retain the majority of the ownership in their companies. In addition to providing early-stage capital, KV leverages our expertise and extensive network of professionals specializing in all disciplines required to build a successful company, including legal, finance, marketing, operations, business development and HR. They provide these services to early stage companies in their portfolio to allow the entrepreneurs to focus their energy on continuing to innovate and pushing the envelope in their respective fields.

Stubbs Alderton & Markiles client, CDTi, a leader in advanced emission control technology, announced the closing of its previously announced rights offering. At the closing, they issued and sold an aggregate of 4,427,563 shares of its common stock at the subscription price of $0.50 per share, pursuant to the exercise of subscriptions and oversubscriptions in the rights offering from its existing stockholders. CDTi received aggregate gross proceeds of approximately $2.2 million from the rights offering before deducting offering expenses.

Stubbs Alderton attorney representing CDTi Advanced Materials in this transaction was Louis Wharton.

About CDTi Advanced Materials
CDTi develops advanced materials technology for the emissions control market. CDTi’s proprietary technologies provide high-value sustainable solutions to reduce hazardous emissions, increase energy efficiency and lower the carbon intensity of on- and off-road combustion engine systems. With a continuing focus on innovation-driven commercialization and global expansion, CDTi’s breakthrough Powder-to-Coat (P2C™) technology exploits the Company’s high-performance, advanced low-platinum group metal (PGM) emission reduction catalysts. Key technology platforms include Synergized PGM (SPGM™) and Spinel™. For more information, please visit www.cdti.com.

For more information about our Public Securities practice, contact Louis Wharton at

Stubbs Alderton & Markiles client ICPW Liquidation Corporation, f/k/a Ironclad Performance Wear Corporation (OTCBB: ICPW), a maker of high-performance and task-specific PPE gloves, has announced that it has been acquired through an Asset purchase by Brighton Best International, Inc.

Originally founded in 1998 in El Segundo - California, IRONCLAD is today headquartered in Farmers Branch, Texas and is the industry leader in high-quality task-specific PPE gloves. IRONCLAD continues to leverage its leadership position in the safety, construction and industrial markets through the design, development, and distribution of specialized task-specific gloves for industries such as oil & gas extraction; automotive; police, fire, first-responder and military and more. Ironclad engineers and manufactures its products with a focus on innovation, design, advanced material science, dexterity, and durability. Ironclad's gloves are available through industrial suppliers, hardware stores, home centers, lumber yards, automotive stores and sporting goods retailers nationwide; and through authorized distributors around the world. Built Tough for the Industrial Athlete™. To learn more and see more, visit: www.ironclad.com

Stubbs Alderton & Markiles, LLP is a business law firm with robust corporate, public securities, mergers and acquisitions, entertainment, intellectual property, brand protection and business litigation practice groups focusing on the representation of, among others, venture backed emerging growth companies, middle market public companies, large technology companies, entertainment and digital media companies, investors, venture capital funds, investment bankers and underwriters. Stubbs Alderton’s clients represent the full spectrum of Southern California business with a concentration in the technology, entertainment, videogame, apparel and medical device sectors. Our mission is to provide technically excellent legal services in a consistent, highly-responsive and service-oriented manner with an entrepreneurial and practical business perspective. These principles are the hallmarks of our Firm.

Peter Csathy to join Board of Directors of Preccelerator®, lead its investment strategy, and oversee anticipated investments

Stubbs Alderton & Markiles and CREATV Media Announce Strategic Alliance to Provide Comprehensive Service Offering to Digital Media and Technology Companies

SANTA MONICA, CA – JANUARY 24, 2017 – Stubbs Alderton & Markiles, LLP, a leading Southern California business, technology and digital media law firm, today announced that it will expand its successful early stage accelerator, the Preccelerator®, to accept a larger group of digital media and technology companies, significantly expand benefits to incoming startups, and look to make strategic investments in these companies and others. Peter Csathy, Chairman of CREATV Media, a leading digital media strategic advisory and business development firm, will join the Board of Directors of the Preccelerator to lead its investment strategy and oversee anticipated investments.

“By partnering with Peter, we will grow the firm’s industry leading Preccelerator® into a full-service platform that not only mentors young companies, but also provides smart venture capital and paths to strategic business development and consulting via CREATV Media,” said Scott Alderton, Chairman of the Preccelerator and Managing Partner of Stubbs Alderton & Markiles, LLP. “While the Preccelerator has seen a lot of success, we want to continue to foster the growth of our early stage companies. By adding more companies, formalizing our class structure, expanding benefits and providing initial seed capital, we will give them a greater shot at success. With Peter’s vast experience and industry leadership, he will lead the investment strategy for these companies.”

To date, the Preccelerator Program has graduated five classes with the majority of the twenty-two companies being accepted into larger accelerator programs and incubators or successfully raising their seed funding round. Stubbs Alderton & Markiles launched the first-of-its kind program to provide select start-ups with co-working space, education, networking, mentorship and sophisticated legal services, with the objective of helping grow a founder’s idea from business concept to a funded company. To apply to the Preccelerator, visit www.preccelerator.com/application.

“Stubbs Alderton’s reputation, entrepreneurial approach and shared vision in growing today’s digital media and technology market, what I call “Media 2.0”, is one of the many reasons we made this happen,” said Peter Csathy, Chairman of CREATV Media. “We deeply believe the growing convergence of content and technology is a worldwide addressable market that requires leading business and legal advisors who think “outside the box”, are deeply connected, move at entrepreneurial speed, and provide access to respected thought leaders and ultimately to smart capital. We aim to bring all of this to our collective client base, and to build CREATV Media and the Preccelerator as launchpad platforms for the world’s next digital media and technology stars.”

The partnership will also look to expand the overall service offering to clients – making available CREATV Media’s deep network of relationships and suite of business development and strategic advisory services and Stubbs Alderton’s deeply-rooted and expanding scope of legal services, led by Greg Akselrud, Chairman of the firm’s Internet, Digital Media and Entertainment practice, and Scott Alderton, Chairman of the Firm’s Venture Capital and Emerging Growth practice.

Stubbs Alderton also announced that Greg Akselrud would join the Board of Directors of the Preccelerator, that Louis Wharton, a law firm partner and current Director of the Preccelerator, would be appointed to President of the Preccelerator, and that Heidi Hubbeling, the law firm’s Director of Marketing and current Director of Operations for the Preccelerator, would be appointed to Chief Operating Officer of the Preccelerator.

Stubbs Alderton & Markiles, LLP is a Southern California based business law firm with robust corporate, public securities, mergers and acquisitions, entertainment, intellectual property, brand protection and business litigation practice groups focusing on the representation of, among others, venture backed emerging growth companies, middle market public companies, large technology companies, entertainment and digital media companies, investors, venture capital funds, investment bankers and underwriters. The firm’s clients represent a broad range of industries with a concentration in the technology, entertainment, videogame, apparel and medical device sectors. The firm’s mission is to provide technically excellent legal services in a consistent, highly-responsive and service-oriented manner with an entrepreneurial and practical business perspective. These principles are the hallmarks of the firm. For more information, visit https://stubbsalderton.com.

The Preccelerator® is a novel platform offered to select start-up companies out of the Stubbs Alderton & Markiles, LLP Santa Monica office that provides interim office space, sophisticated legal services, education, networking, mentorship and $250,000 in usable perks from Google Cloud for Startups, Amazon Web Services, and HubSpot among others, with the objective of helping grow a founder’s idea from business concept to funded startup. The program also retains more than 50 active strategic mentors providing free office hours and discounted services, and provides over 50+ educational workshops and networking events each year. The expanded program will accept a greater number of companies in more formalized classes, depending upon where the companies are in their evolutionary growth, expand benefits to accepted companies, and will look to make strategic investments backed by strategic angel investors. To apply to the Preccelerator, visit www.preccelerator.com/application.

CREATV Media is a leading digital media and technology focused advisory, consulting and business development firm with offices in Los Angeles, San Francisco, San Diego, New York City, Austin and Germany. The firm’s clients span the digital media and tech ecosystems – from the most innovative startups, to the most storied media companies and brands. The firm uses proven, proprietary methodologies – together with exclusive insights, access and market intelligence – to accelerate Media 2.0-related opportunities and transformational growth. The firm also frequently works with buyers and sellers to maximize M&A – positioning them to achieve the best possible outcomes, identifying potential targets and connecting them to key decision-makers, helping to structure and diligence potential transactions, and advising them every step of the way both pre and post transaction. The firm also organizes, programs and leads customized workshops, live events, pilot programs and start-up innovation labs and demo days. The firm’s ethos of fearless innovation is best summed up by its slogan “Media. Unboxed.” For more information, visit CREATV Media.

SAM Client Michelle Gaster Wasserman, who most recently led the North America e-commerce business for Coach, Inc. has been named the new CEO for Adam Lippes. SAM Partner Louis Wharton represented Gaster Wasserman in negotiating the employment deal.

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