Investment agreement term sheet Template for Belgium

An Investment agreement term sheet lays out the key points of a proposed investment deal in Belgium, serving as a roadmap for the final agreement. It captures essential details like investment amount, company valuation, investor rights, and key governance terms before lawyers draft the complete documentation.

While not legally binding under Belgian law (except for confidentiality and exclusivity clauses), these term sheets help both investors and companies save time and money by aligning expectations early. They typically follow standard formats recognized by the Belgian Financial Services and Markets Authority (FSMA) and include provisions that comply with Belgium's Company Code requirements for shareholder agreements.

Use an Investment agreement term sheet when you're ready to formalize serious investment discussions but before spending resources on full legal documentation. It's particularly valuable when negotiating with Belgian venture capital firms, angel investors, or strategic partners who need to align on key deal terms early in the process.

The term sheet becomes essential during funding rounds where multiple investors are involved, or when dealing with complex investment structures under Belgian corporate law. It helps prevent misunderstandings about critical elements like share classes, board seats, and exit rights while saving time and legal costs by establishing clear parameters before detailed contract drafting begins.

• Standard Equity Investment: Basic term sheets for traditional stock purchases, common in Belgian SME funding rounds, outlining share price, voting rights, and basic investor protections
• Convertible Note Term Sheet: Used for bridge financing, detailing conversion terms, interest rates, and valuation caps under Belgian financial regulations
• Strategic Investment: Includes additional provisions for corporate investors, like commercial agreements and technology licensing rights
• Series A+ Term Sheet: More complex structures for later-stage investments, incorporating anti-dilution protection and preferred shareholder rights
• Co-Investment Term Sheet: Designed for multiple investors, addressing syndication rules and inter-investor relationships under Belgian company law

• Startup Founders: Lead negotiations and share company information, setting initial terms for investment discussions
• Venture Capital Firms: Draft and propose term sheets, often using standardized templates aligned with Belgian investment practices
• Corporate Lawyers: Review and refine term sheets to ensure compliance with Belgian corporate law and protect client interests
• Angel Investors: Negotiate key terms and conditions, particularly focusing on valuation and investor protection rights
• Financial Advisors: Support both sides in structuring deals and understanding market-standard terms in the Belgian context

• Company Information: Gather accurate financial statements, cap table, and corporate documents required under Belgian law
• Investment Details: Define investment amount, valuation, and type of securities being offered
• Governance Rights: Outline board composition, voting rights, and any special approval requirements
• Key Protection Terms: List anti-dilution provisions, pre-emptive rights, and transfer restrictions
• Exit Provisions: Specify drag-along rights, tag-along rights, and liquidation preferences
• Timeline Planning: Set clear deadlines for due diligence, document preparation, and closing conditions

• Parties and Structure: Full legal names of investors and company, plus detailed investment structure under Belgian law
• Investment Terms: Precise valuation, share price, and total investment amount in euros
• Share Rights: Detailed description of share class privileges, voting rights, and dividend preferences
• Governance Provisions: Board composition, reserved matters, and decision-making thresholds
• Transfer Restrictions: Lock-up periods, right of first refusal, and tag-along/drag-along rights
• Binding Provisions: Clear statement of which terms are legally binding under Belgian contract law
• Confidentiality: Scope of information protection and non-disclosure obligations

A key distinction exists between an Investment agreement term sheet and an Investment Agreement. While both documents relate to investment transactions, they serve different purposes in Belgian business practice.

• Legal Binding Nature: Term sheets are mostly non-binding documents outlining key terms, while Investment Agreements are fully binding legal contracts that create enforceable obligations
• Level of Detail: Term sheets provide a high-level summary of main points, whereas Investment Agreements contain comprehensive legal provisions, warranties, and detailed mechanics
• Timing: Term sheets come first in negotiations to establish framework terms, while Investment Agreements follow as the final, executable documentation
• Cost and Complexity: Term sheets are simpler and less expensive to draft, making them ideal for initial agreement on key terms before investing in full legal documentation