Kraig Biocraft Laboratories Inc (KBLB)

[arachnodude]

Maybe this will help explain a little further...

There are two ways to form a joint venture:

1) Form a separate legal entity for the joint venture, such as a corporation or limited liability company (LLC), with each party having an ownership stake in the new entity; [WHICH THEY JUST ANNOUNCED TODAY] or


2) Operate under a joint venture agreement without creating a separate legal entity. This is called an unincorporated joint venture.[WHICH THEY ANNOUNCED 3 MONTHS AGO]

There are both advantages and disadvantages to the two structure options.

Forming a separate legal entity for your joint venture is the more expensive and complex option. If you form a corporate joint venture, for example, the joint venture will be responsible for filing and paying its own business taxes. However, having a separate legal entity also provides more legal protection if something goes wrong.

The faster, less expensive option is to get started with a simple contractual arrangement. In this case, the joint venture doesn’t report any profits of its own and doesn’t pay taxes on its own. The profits flow through to the respective parties’ tax returns.

If you’re exploring a joint venture for a narrowly defined purpose where liability isn’t much of a concern, it might be fine to get started this way. For a more complicated joint venture, on the other hand, it’s safest to establish a separate legal entity