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Doing business has its own perks, especially when you’re raising funds. While seeking and finding investors is a crucial setup, signing agreements, sheets without a legal opinion can put you at risk. And while it’s an additional cost to make, it might be one of your first steps to more efficient decision making. Our professional’s review provides you with a detailed review around vesting period, lock-in period, exits, IP rights, valuations and any other hidden information in your investment documents.
A Term Sheet outlines the details of the conditions under which and investment is made. It is a non-binding agreement drawn up once the significant aspects such as Investment amount, company’s valuation, voting rights, stakes, liquidation preferences and investor commitments are agreed upon.
All term sheets contain information on the assets, initial purchase price including any contingencies that may affect the price, a timeframe for a response, and other salient information.
A term sheet may seem similar to a letter of intent (LOI) or Mandate when the action is predominately one-sided, as in acquisitions, or a working document to serve as a jumping-off point for more intensive negotiations. The main difference between an LOI and a term sheet is stylistic; the former is written as a formal letter while the latter is composed of bullet points outlining the terms.
We get your financial documents evaluated by a financial expert to see the current standing of your company. Afterwards, the term sheet and related investment documents are reviewed by a lawyer who goes into detailed account of liabilities, claims to seek any potential downside or dispute that might arise.
No, it’s completely voluntary and up to you. However, we highly advise for a professional review as it helps in understanding the deal in detail and ensuring that all pieces are in place and both parties in good faith.
A term sheet is commonly used to arbitrate the discrepancies on the essential facets of any trade contract before outlining the actual agreement, thereby avoiding any unwanted expenses from a company's reserves.
A term sheet is drafted to put a plan in place for the consenting parties involved instead of drafting a long contract. However, the details of the clauses won’t be present, but rather contain the fundamentals of how they would be reached upon.