Term Sheet - Merger, Acquisition, & Joint Venture Templates



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SUMMARY OF TERMS FOR THE PRIVATE PLACEMENT OF

SERIES A PREFERRED STOCK OF

________________, Inc.

Month Day, Year

|This document summarizes the principal terms of the proposed financing of _______, Inc. (the “Company”). This summary is for discussion |

|purposes only; there is no obligation on the part of any negotiating party until a definitive stock purchase agreement is signed by all |

|parties and the conditions precedent to financing set forth below are satisfied. This summary does not constitute either an offer to sell or |

|an offer to purchase securities. |

|Amount of Financing: |$____________________ |

|Type of Security: |Series A Convertible Preferred Stock (the “Series A Preferred”). |

|Pre-money Valuation: |$____________________ |

|Number of Shares: |_____________________ |

|Price: |$_____ per share (the “Purchase Price”). |

|Closing Date: |The closing of the sale of Series a Preferred Stock will be on or about ____________, ______ (the |

| |“Closing”) |

|Investor(s): | | |Investment Amount | |Number of Shares |

| | | | | | |

| | | | | | |

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| | | |$_________ | |________ |

|Post-Financing Capitalization: | | |Number of Shares | | |

| |Class | | | |Percent |

| | | | | | |

| | | | | | |

| |Total | | | |100.0% |

|Use of Proceeds: |Proceeds will be used in accordance with a plan (including key milestones) and a 12-month budget to be|

| |mutually agreed upon by the Company and the Investors prior to Closing. |

|Rights, Preferences, Privileges and |Dividends. The holders of Series A Preferred shall be entitled to receive dividends when, as and if |

|Restrictions of the Series A Stock: |declared by the Board. Declared, but unpaid dividends shall be paid upon conversion in either cash or|

| |Common Stock at the option of a majority of the Board at the then fair market value (as determined by |

| |a majority of the Board). Without the approval of a majority of the holders of the Series A |

| |Preferred, no dividends shall be paid on the Common Stock so long as the Series A Preferred is |

| |outstanding. |

| |Liquidation Preference. In the event of any liquidation, dissolution or winding up of the Company, |

| |the holders of the Series A Preferred shall be entitled to receive in preference to the holders of the|

| |Common Stock a per share amount equal to the Purchase Price (as adjusted for stock splits, stock |

| |dividends, stock combinations and the like), plus any declared but unpaid dividends (the “Liquidation |

| |Preference”). After the payment of the Liquidation Preference to the holders of the Series A |

| |Preferred, the remaining assets shall be distributed ratably to the holders of the Common Stock and |

| |the Series A Preferred on an as-converted basis; provided that the holders of Series A Preferred will |

| |stop participating once they have received a total liquidation amount per share equal to two (2) times|

| |the Purchase Price. A merger, acquisition or sale of voting control or sale of substantially all of |

| |the assets of the Company (a “Sale of the Company”) in which the shareholders of the Company |

| |immediately prior to such event do not own a majority of the outstanding shares of the surviving |

| |corporation shall be deemed to be a liquidation. |

| |Voluntary Conversion. Each holder of Series A Stock will have the right, at the option of the holder |

| |at any time, to convert shares of Series A Stock into shares of Common Stock at an initial conversion |

| |ratio of one-to-one. |

PARTIAL DOCUMENT – THE REMAINDER IS NOT SHOWN. GET THE FULL DOCUMENT HERE.

ADDITIONAL TEMPLATE PREVIEWS

Click Link to Preview Document

|Guides |LOI Tools and Templates |

|Anatomy of LOI - Ver1 |Full Buyout |

|Anatomy of LOI - Ver2 |Asset Purchase - Ver1 |

|Asset vs. Stock Purchase |Asset Purchase - Ver2 |

|Purchase Price Payment Considerations |Stock For Cash |

|Ways to Structure the Deal - Ver1 |Stock For Stock |

|Ways to Structure the Deal - Ver2 |Stock For Cash & Stock |

|Ways to Structure the Deal - Ver3 |Earnout |

|Structuring Effective Earnouts |Partial Investments |

|Tax Implications |Series A Preferred |

|What is a Reverse Merger? |Series B Preferred |

| |Presentations |

| |Presenting the Deal - Ver1 |

|  |Presenting the Deal - Ver2 (No Preview) |

| |Presenting the Deal - Ver3 |

| |Presenting the Deal - Ver4 |

| |Presenting the Deal - Ver5 |

| |Business Sale Presentation  |

 

|Buying or Selling a Business Step-by-Step Procedure - Click Here To View |

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