A investment agreement term sheet is a document that outlines the major terms and conditions of a proposed investment transaction, and is typically used to precede the drafting of a more detailed legally binding agreement. The term sheet sets forth the key terms and provisions of the proposed transaction, and provides the framework within which the parties will negotiate the final terms of their agreement.
A term sheet for a syndicated term loan outlines the terms and conditions of the loan agreement between a borrower and a syndicate of lenders. The term sheet includes drafting notes for the loan agreement. This type of loan is typically used to finance the production of commodities.
This is a lightweight but typical term sheet that a venture capital investor would give to a company or founder when investing in their company. This term sheet is typical of a pre-seed or seed investment round, and also includes a draft cap table in the schedule. The template is drafted to be founder friendly.
This comprehensive term sheet, drafted by Atlassian and customisable on the Genie AI platform, aims to remove confusion surrounding the M&A process, particularly for founders who are selling a company for the first time. It contains explanations of key terms to aid transparency and a fair agreement.
By moving away from one-sided, buyer-favourable terms, this term sheet may reduce friction and avoid lengthy negotiations.
Some of the major terms to pay attention to are: purchase price, founders’ roles, stock vs. cash consideration, retention equity, indemnification, escrow and risk allocation.
This is a lightweight but typical term sheet that a venture capital investor would give to a company or founder when investing in their company. This term sheet is typical of a pre-seed or seed investment round, and also includes a draft cap table in the schedule. The template is drafted to be investor friendly.
This is a standard, easy and fast term sheet, drafted by YC and customisable live on the Genie AI platform. Series A documents set the precedent for the terms of future rounds. For this reason you want to keep things simple early on, as complexity can creep in with each round. If you begin with complex terms, you will invariably make future rounds more complicated which might result in some investors dropping out.
Y Combinator have seen hundreds of term sheets and they therefore know what 'good' looks like. Founders, especially if it is their first company, do not. YC created this term sheet as an attempt to standardise terms and use plain english rather than legalese to alleviate this common disadvantage faced by founders.
The clauses and legal terms around company structure, board composition and operational control are particularly important to keep balanced and standardised.
Investors might manifest their desire to reduce downside risk or boost upside potential through the use of dirty terms, pushing you to sell against your wishes or controlling how much risk you take on in pursuit of a new potential strategy or pivot.
This template is intended to be customised with your own requirements, so you can cover the specifics of your standard needs. It will also allow you to fully customise it to your own specifications as you deem fit.
This model term sheet for Series A round has been drafted by BVCA for companies anticipating a significant investment made either in part or whole by fund investors.
The term sheet, for early stage venture capital investment, has been revised and re-launched by BVCA following a review involving their Venture Capital and Legal committees. The aim is to provide industry-standard legal documentation to allow entrepreneurs and investors to save time and money when negotiating a deal.
Note: Although we list lawyers as well as legal firms who may be able to help, this does not indicate that the listed law firms have an affiliation or partnership with Genie AI.