A Funding Term Sheet is a foundational document used in investment transactions to establish the preliminary understanding between investors and companies seeking funding. It is particularly relevant in Hong Kong's dynamic investment landscape, where it must comply with local securities regulations and corporate law requirements. The document typically precedes more detailed investment agreements and serves to memorialize key commercial terms, valuation metrics, and investor rights. While mostly non-binding, certain provisions like confidentiality and exclusivity are typically enforceable. The term sheet's structure and content are influenced by Hong Kong's common law system and local market practices, making it essential for both domestic and international investment transactions. It forms the basis for due diligence and the preparation of definitive agreements.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Your data doesn't train Genie's AI
You keep IP ownership of your docs
Alternatively...
1. Parties: Identification of the company, lead investor(s), and other participating investors
2. Background: Brief description of the company, purpose of the investment, and current fundraising round
3. Definitions: Key terms used throughout the term sheet
4. Investment Terms: Amount of investment, valuation, price per share, and investment structure
5. Closing Conditions: Conditions precedent to closing, including due diligence, board approval, and regulatory requirements
6. Use of Proceeds: Intended use of the investment funds
7. Investor Rights: Key rights including information rights, board representation, and protective provisions
8. Transfer Restrictions: Limitations on share transfers, right of first refusal, co-sale rights
9. Confidentiality: Confidentiality obligations regarding the term sheet and negotiations
10. Binding Effect: Clarification of which provisions are binding and non-binding
11. Exclusivity: Period during which the company cannot seek alternative investments
12. Expiration: Validity period of the term sheet
1. Convertible Terms: For convertible investments: conversion price, caps, discounts, and triggering events
2. Anti-dilution Protection: Include when sophisticated investors require protection against down rounds
3. Liquidation Preference: Terms for preferential returns in liquidation events, typically for Series A or later rounds
4. Participation Rights: Include for preferred shares with participation rights beyond liquidation preference
5. Dividend Rights: Include when specific dividend rights are part of the investment terms
6. Drag-Along Rights: Include in later-stage investments to force minority shareholders to join in company sale
7. Registration Rights: Include for US investors or when IPO is a likely exit route
8. Employee Share Option Pool: Include when new ESOP is being created or existing pool is being expanded
1. Cap Table: Pre and post-money capitalization table showing ownership structure
2. Key Terms Summary: Summary of key commercial terms in table format for quick reference
3. Milestone Schedule: If investment is tranched, details of milestones and corresponding investment amounts
4. Pre-Closing Checklist: List of required documents and actions to be completed before closing
Authors
Find the document you need
Commission Payment Agreement
A Hong Kong law-governed agreement establishing commission payment terms and conditions between a company and its agents/representatives.
Download
Intra Group Transfer Agreement
A Hong Kong law-governed agreement facilitating transfers between entities within the same corporate group.
Download
DPA Agreement
A Hong Kong law-governed agreement between a data controller and processor establishing terms for personal data processing in compliance with the PDPO.
Download
Referral Agent Agreement
A Hong Kong law-governed agreement establishing terms for referral arrangements between a principal and an agent, including compensation and compliance requirements.
Download
Funding Term Sheet
A preliminary document under Hong Kong law that outlines key terms and conditions for a proposed investment, serving as a framework for final investment agreements.
Download
Commission Confirmation Letter
A Hong Kong law-governed letter confirming commission arrangements between parties, specifying rates, calculation methods, and payment terms.
Download
Independent Sales Rep Agreement
A Hong Kong law-governed agreement establishing terms between a company and an independent sales representative, defining commission structure, territories, and responsibilities.
Download
Commission Share Agreement
A Hong Kong law-governed agreement establishing terms for commission sharing between parties, including calculation methods, payment terms, and obligations.
Download
Broker Fee Agreement
A Hong Kong law-governed agreement establishing broker services terms and fee arrangements between licensed brokers and their clients.
Download
Commission Distribution Agreement
A Hong Kong law-governed agreement establishing commission-based distribution arrangements between a principal and distributor, including territory rights and performance terms.
Download
Sales Representative Agreement
A Hong Kong law-governed agreement establishing the terms and conditions between a company and its sales representative, including appointment, territory rights, and compensation structure.
Download
Genie’s Security Promise
Genie is the safest place to draft. Here’s how we prioritise your privacy and security.
Your data is private:
We do not train on your data; Genie’s AI improves independently
All data stored on Genie is private to your organisation
Your documents are protected:
Your documents are protected by ultra-secure 256-bit encryption
We are ISO27001 certified, so your data is secure
Organizational security:
You retain IP ownership of your documents and their information
You have full control over your data and who gets to see it
