Our software company has a kick-ass product, which is the only thing of value to the company. What measures can I take to ensure the IP remains within the company?

I have heard stories that a hostile board take over can transfer the IP ownership to another company. This renders any Golden Parachute, founders shares and etc as useless. The founder can have 30% share, but 30% of a ZERO value company is zero.

  • 2
    "What measures can I take to ensure the IP remains within the company?" Talk to your company's legal department. Aug 31, 2019 at 2:04
  • And if you don't have a legal department, you should seek out a lawyer with experience in corporate law (which covers these issues of corporate governance).
    – cpast
    Aug 31, 2019 at 2:58

1 Answer 1


The board rules.

Companies usually go to great lengths to be sure the company owns the IP developed within and for the company. But the company is governed by its board of directors and that board can decide to take the company in a new direction where some IP that the company owns would no longer be a key asset for ongoing business. Selling that IP to another organization might, then, be logical. Boards are elected by, and represent, the owners of the company.

  • Thanks George. Can one also make a clause in the constitution to ensure that 100% board agreement is required before the sale or transfer of key assets? Aug 31, 2019 at 12:00
  • I do not know. My opinion is that boards usually represent several people with somewhat different interests and this would not work. Aug 31, 2019 at 15:58

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