A term sheet is usually a nonbinding agreement setting forth the basic terms and conditions under which an investment will be made. A term sheet serves as a template to develop more detailed legal documents such as a Subscription Agreement or a Shareholder Agreement. The term sheet outlines the terms by which an investor will make a financial investment in your company and usually deal with:
- corporate governance
When negotiating a term sheet, both sides (the entrepreneur and the investor) will usually need to make concessions. If there is limited investors, the investor will have a strong negotiating position. Conversely, should they be multiple investment offers the entrepreneur will be able to demand more favourable terms. Please do not hesitate to contact us.