Corporate Term Sheet (Material Terms and Conditions of Business Agreement)
This term sheet is a bullet-point document outlining the material terms and conditions of a business agreement. After a term sheet has been "executed", it guides legal counsel in the preparation of a proposed "final agreement". It then guides, but is not necessarily binding, as the signatories negotiate, usually with legal counsel, the final terms of their agreement.
This term sheet includes conditions for financing a startup company. The key offering terms in such a term sheet include (a) amount raised, (b) price per share, (c) pre-money valuation, (d) liquidation preference, (e) voting rights, (f) anti-dilution provisions, and (g) registration rights. It also offers a number of possible terms which the purchaser can use to customize his or her deal.
DISCLAIMER: THIS DOCUMENT IS INTENDED TO SERVE AS A STARTING POINT ONLY, AND SHOULD BE TAILORED TO MEET YOUR SPECIFIC REQUIREMENTS. THE DOCUMENTS SHOULD NOT BE CONSTRUED AS LEGAL ADVICE FOR ANY PARTICULAR FACTS OR CIRCUMSTANCES. PURCHASE OR USE OF THIS DOCUMENT DOES NOT CREATE AN ATTORNEY/CLIENT RELATIONSHIP. YOU SHOULD ALWAYS CONSULT WITH AN ATTORNEY BEFORE EXECUTING A LEGAL DOCUMENT.