Investment agreement term sheet Template for Austria

A Investment agreement term sheet outlines the key terms and conditions for investing in an Austrian company. It serves as a preliminary document that captures the main points both parties have agreed on before drafting the final, legally binding investment agreement. Think of it as a roadmap that spells out essential details like valuation, investment amount, and shareholder rights.

Under Austrian corporate law, especially the GmbH-Gesetz, these term sheets help streamline negotiations and provide a foundation for due diligence. While not typically legally binding (except for confidentiality clauses), they save time and money by getting everyone aligned on major points early. Smart investors and founders use them to avoid misunderstandings and keep complex deals on track.

Use an Investment agreement term sheet when you're ready to formalize negotiations for investing in an Austrian company but aren't yet prepared to draft the final agreement. It's particularly valuable when dealing with complex investment structures, multiple investors, or when significant due diligence still needs to be completed.

This document becomes essential during early-stage funding rounds, mergers, or when bringing strategic investors aboard. Austrian businesses often introduce term sheets after initial verbal agreements but before expensive legal work begins. It helps prevent misunderstandings about key terms like share classes, voting rights, and exit provisions while keeping negotiations focused and efficient under Austrian corporate law requirements.

• Standard Equity Investment: Most common type for Austrian startups, covering basic share purchase terms, valuation, and voting rights
• Convertible Loan Term Sheet: Outlines terms for debt that converts to equity, popular with early-stage Austrian companies seeking bridge financing
• Strategic Investment Version: Used when corporate investors seek special rights or board seats, includes detailed governance provisions
• Series Funding Sheet: More complex version for larger funding rounds, typically including anti-dilution and preference rights
• Joint Venture Investment: Specialized version for when investment involves operational collaboration under Austrian corporate law

• Startup Founders: Initiate and review Investment agreement term sheets when seeking funding, often working with their legal counsel to protect company interests
• Angel Investors: Individual investors who propose or negotiate terms, typically for early-stage investments in Austrian startups
• Venture Capital Firms: Professional investors who draft detailed term sheets for larger funding rounds, usually through their legal departments
• Corporate Lawyers: Draft and review terms to ensure compliance with Austrian corporate law and protect their clients' interests
• Investment Banks: Often involved in larger deals, helping structure terms and facilitate negotiations between parties

• Company Details: Gather current capitalization table, corporate documents, and financial statements as required by Austrian company law
• Investment Structure: Define investment amount, valuation, and type of shares or instruments being offered
• Key Rights: Outline voting rights, board seats, anti-dilution provisions, and exit rights you plan to include
• Due Diligence Items: List key business metrics, intellectual property status, and material contracts
• Timeline Planning: Set clear milestones for negotiation, due diligence completion, and final closing
• Document Platform: Use our platform to generate a legally-compliant term sheet that includes all required Austrian legal elements

• Investment Terms: Precise details of investment amount, company valuation, and share class or instrument type
• Investor Rights: Clear outline of voting rights, board representation, and information access rights
• Anti-Dilution: Protection mechanisms and share adjustment provisions under Austrian corporate law
• Exit Rights: Tag-along, drag-along rights and conditions for company sale or IPO
• Confidentiality: Binding non-disclosure provisions for negotiation period
• Governing Law: Explicit statement of Austrian law application and jurisdiction
• Binding Provisions: Clear indication of which terms are legally binding versus non-binding

Let's compare an Investment agreement term sheet with a full Investment Agreement, as these documents often cause confusion in Austrian business transactions.

• Legal Status: Term sheets are usually non-binding summaries of key terms (except for confidentiality provisions), while Investment Agreement is a fully binding legal contract
• Detail Level: Term sheets contain brief summaries of main points, typically 5-10 pages, while Investment Agreements include complete legal language and detailed provisions, often 30+ pages
• Timing: Term sheets come first during negotiations to align parties on key terms, while Investment Agreements follow after due diligence and detailed negotiations
• Cost and Complexity: Term sheets are simpler and less expensive to draft, making them ideal for initial discussions and preventing costly misunderstandings before full legal documentation