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Andrew Dimitriou, Christina Tsakona, Nayia Antoniou
Colab AIT | February 7, 2013
Welcome to...
A short intro to Term Sheets
by Nayia Antoniou
Definition
A Term Sheet is a document which outlines the key financial and other terms of a proposed investment.
Contents Offering terms
Conditions
Classes of shares
Liquidation preference
Investor rights
Preemptive rights
Founders undertakings
Other matters
Offering Terms
Investors
Amount raised
Pre-money valuation
Closing date
Share option pool
Anti dilution
Conditions
Due diligence
Anti-money laundering
IP assignment
Warranties
Expenses
Classes of shares
Preferred
Common
Conversion
Liquidation preference
In case of acquisition or change of control
Winding up, dissolution, liquidation
Investor rights
Director appointment
Information rights
Matters requiring investor consent i.e. change of company's shareholding structure, dividends etc.
Preemptive rights
Right of first refusal
Tag along
Drag along
Founders undertakings
No compete
No solicitation
Employment agreement
Reverse vesting
Other matters
Exclusivity
Confidentiality
Non-binding effect
Remember...
Do not panic!
The business decision is yours
Consult a lawyer (if required)
Good luck!
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