It includes
A. What is a Term Sheet?
B. The Investment Process
C. What terms are typically included in a Term Sheet?
1. Type of share
2. Valuation and milestones
3. Dividend rights
4. Liquidation preference and deemed liquidation
5. Redemption
6. Conversion rights
7. Automatic conversion of share class/series
8. Anti-dilution (or price protection)
9. Founder shares
10. Pre-emption rights on new share issues
11. Pre-emptive rights on transfer and tag-along rights
12. Drag along or bring along
13. Representations and warranties
14. Voting rights
15. Protective provisions and consent rights (class rights)
16. Board of Directors/Board Observer
17. Information rights
18. Exit
19. Registration rights (US)
20. Confidentiality, Intellectual Property Assignment and Management
Non-compete Agreements
21. Employee share option plan
22. Transaction and monitoring fees
23. Confidentiality
24. Exclusivity and Break Fees
25. Enforceability
26. Conditions precedent
V Venture Capital Glossary of Terms
VI Example of a Term Sheet for a Series A round
All credit goes to Simpson Grierson
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