Business Law: From Launch to Maturity

Worthington Law|Business Law: From Launch to Maturity

Building a Business

It’s unwise if not impossible to build a company without consulting a lawyer, and a really good business attorney is one that can offer both strategic advice and the practical services required as the enterprise grows. The saga of the Petrol Advertising firm in Burbank, California, provides a perfect illustration.

Michael Worthington got involved with the startup of new ad agency in 2003 – helping the founders who were bootstrapping their dream and needed his help organizing the new company. The young execs had been part of the team at a larger agency that did breakthrough work on various Hollywood studio ad campaigns; among other things, they’d created the iconic poster for the shark thriller, Jaws. To help get the business off the ground, Worthington did the legal work for the business formation, setting up the Petrol Advertising corporation and organizing a corporate book with share certificates to be registered and distributed to the new owners. He later became a director with a seat on the Petrol board.

As the agency grew, the need for legal work kept pace. Worthington was called on to handle agency contracts, human resources issues for the expanding roster of 70 employees, along with non-disclosure agreements for employees, independent contractors and vendors, and executive employment contracts. He conducted a valuation study (Worthington has an MBA from UCLA) and prepared buy-sell agreements. In 2007, he oversaw the preparation of the company’s stock option plan. When Petrol purchased a headquarters building in Burbank, he handled the sales transaction documents and the contracting for a remodeling project the agreement for a remodeling. In effect, he became a counselor on call for any needed legal services.

The Serious Business of Games

Petrol specialized in entertainment industry advertising, and the agency’s focus was on the expanding universe of video games production. In fact Petrol eventually launched some 1500 games titles for the mushrooming gamer industry, generating over $40 billion in sales for the agency’s clients with franchises like the “Call of Duty”, “Destiny” and “Frozen Adventure” by focusing on promotional storytelling.

By 2018, the company’s advertising and brand marketing expertise both at home and abroad put them on the radar of a publicly-held, international videogame producer called Toadman based in Stockholm, Sweden. Toadman had a vision to grow beyond the confines of game development and pursue marketing for other brands and technology innovation for the global games industry.

Today, Petrol works with a broad range of clients spanning entertainment, consumer products, gaming, sports, technology and consumer electronics.


Toadman and Petrol formed a strategic partnership, and the ad agency becoming a part of the Toadman family as a separate entity. Worthington worked on the deal documentation prepared by Sheppard, Mullin, Richter and Hampton LLP, and performed the due diligence process of identifying and producing documents, responding to buyer queries, advising on risk management, and drafting a new lease between the shareholders’ limited liability company that owned the building the new Petrol merger partner would occupy.  There was a five-year earn-out for the agency principals on the $30 million deal. He worked with Petrol’s management on refinancing of the building that Petrol occupies to free cash for use during the earn-out period.

During each phase of Petrol’s evolution from fledgling startup to global player, Worthington played a key role — from designing the company’s legal foundation to maintaining steady operations from a legal standpoint and ensuring proper corporate governance. It’s a testament to his versatility and skill that he has been able to help the company clear the many hurdles that any small business encounters during a 16-year run and chart its course for future success.