This document provides an overview of capitalization tables and related topics. It begins with an explanation of actual and pro forma capitalization tables, including the key components of each. It then discusses the different types of securities that can be on a capitalization table like common stock, options, and convertible debt. The rest of the document reviews who is typically included on a capitalization table such as founders, employees, investors. It also covers related topics like vesting, anti-dilution protection, an example Series A term sheet and pro forma capitalization table. The document aims to provide a comprehensive introduction to understanding and working with capitalization tables.
Negotiating the Preferred Stock Term SheetBart Greenberg
This slide show outlines and discusses the key elements of a preferred stock term sheet, and shows the range of negotiability of those terms in the best and worst of times.
Negotiating the Preferred Stock Term SheetBart Greenberg
This slide show outlines and discusses the key elements of a preferred stock term sheet, and shows the range of negotiability of those terms in the best and worst of times.
This presentation was given to a group of Founders, CEO's and praticipants in the Financing of their growth companies at the Digital Media Zone at Ryerson University in Toronto today.
An analysis of the Hilton hotels buyout by BlackstoneFrancesco Romeo
This presentation is about the Hilton hotels buyout. We analyze the case with different methods and our conclusion is that it was good deal for both Hilton and Blackstone.
This presentation was given to a group of Founders, CEO's and praticipants in the Financing of their growth companies at the Digital Media Zone at Ryerson University in Toronto today.
An analysis of the Hilton hotels buyout by BlackstoneFrancesco Romeo
This presentation is about the Hilton hotels buyout. We analyze the case with different methods and our conclusion is that it was good deal for both Hilton and Blackstone.
Part of the all day Venture Fast Track:
http://www.thecapitalnetwork.org/programs/venture-fast-track/
Angel & Venture Term Sheets and Negotiation with an Investor
As an entrepreneur, understanding the parts of an Angel or Venture Capital term sheet can be a daunting task. The session discusses common practices and pitfalls surrounding the use of term sheets and the current market terms for early-stage angel and venture investments. Some sample term sheets will be reviewed and explained.
Led by a venture capitalist, an entrepreneur, and their attorneys, this program explains the critical common business and legal terms used in these term sheets through a live, mock negotiation.
Experts:
- Justin Borgman – Hadapt
- Yumin Choi – HLM Venture Partners
- Alex Glovsky – Nutter, McClennen & Fish
- Adam Ghander – Nutter, McClennen & Fish
Booklet & Term Sheet of first Setting the Deal Athens, that took place during Panorama of Entrepreneurship and Career Development on March 21st, 2105 featuring Spyros Trachanis (Odyssey JEREMIE Partners), John Papadakis (Pollfish), Nayia Antoniou (N. Antoniou & Associates), Nik Kalliagkopoulos (Randstad Innovation Fund) and Demetrios Pogkas (Startupper.gr).
Speaker: Tony Redpath
Part of the CIBC Presents Entrepreneurship 101 series. More information including webcast can be found here: http://www.marsdd.com/Events/Event-Calendar/Ent101/2008/termsheets-20080312.html
VC Bootcamp By DFJ Gotham Ventures and Wilson Sonsini Goodrich & RosatiMark Davis
Slides from the Venture Capital Bootcamp event hosted by DFJ Gotham Ventures and Wilson Sonsini Goodrich & Rosati at Columbia University on June 3, 2009. A video of the 3 hour event is available at www.dfjgotham.com.
Negotiating the Term Sheet in Today's MarketBart Greenberg
This slide show outlines and discusses the key elements of a preferred stock term sheet, and shows the range of negotiability of those terms in the best and worst of times.
Learn from Jeffrey Char (President & CEO of J-Seed Ventures, serial entrepreneur) how to negotiate a typical venture capital term sheet.
Takeaway
-understand the terms & conditions of a term sheet
-negotiating and structuring investment deals
-negotiating terms for the benefit of founding team
The MSA Launch (http://bit.ly/1yhQPZV) is a 5-day event aiming to provide an introduction to MaGIC Academy. It is presented as a condensed version of how MaGIC Academy is going to contribute to you and the startup community. You will be able to experience a series of workshops, skill and sharing knowledge opportunity, and mentoring with our selected network of mentors.
Website : www.mymagic.my
Facebook : https://www.facebook.com/magic.cyberjaya
Twitter : https://twitter.com/magiccyberjaya
Youtube :
SlideShare : http://slidesha.re/1BfSncP
Email : enquiries@mymagic.my
Attorney Hans Kim of Wilson Sonsini Goodrich & Rosati will review recent trends in start-up financings, including SAFE instruments, convertible equity, series seed, crowdfunding etc. Hans will also review key terms of Series A financings and important steps that every start-up should take to avoid issues that can delay or derail early stage financings.
Recorded 10/19/2023
This webinar is critical for entrepreneurs who will be raising a preferred round in the near future. This webinar is designed to teach you what to expect when your company sells preferred stock in a venture round.
During this webinar, veteran Silicon Valley venture capital attorney Alidad Vakili will cover the following topics:
· What venture capitalists are looking for when they invest in a company
· What makes a company a potential investment for a venture capital fund
· Pre-round issues
· What makes a good investor and how to find them
· How to negotiate a term sheet
· The deal documentation
· The diligence process
· Closing issues
· Post-closing issues
· Common pitfalls when raising venture capital
· And more!
About the Speaker
Alidad Vakili is an attorney in the Palo Alto office of Foley and Lardner, an international law firm. He regularly represents startup and emerging growth companies at every stage of the company lifecycle—from startup to liquidity. He frequently advises clients on a variety of strategic growth issues including venture capital and private equity financing, private offerings, joint ventures and M&A transactions. His work includes not only advising on major corporate milestones but also significant involvement in day-to-day operations and strategic business issues, such as formation, governance, and commercial agreements.
Lecture 9: Term Sheets | Adv. Venture Capital-FINAN 6310 | Chad Jardine, Univ...Chad Jardine
Section 9: Term Sheets
This presentation is part of a series of lectures by Chad Jardine, teaching FINAN 6310, Adv. Venture Capital at the University of Utah, 2008–.
This video series is NOT a complete online course of itself (with context, exercises, examinations, etc.), but it contains lecture content from FINAN 6310 Advanced Venture Capital, which builds on the concepts introduced in FINAN 6300 and further develops the language, skills, know-how, concepts, attitudes and information surrounding raising capital for new and growing businesses. We’ll focus on four dimensions of funding a new venture: Company, Context, Investors and the terms of the Deal.
This course aims to increase your odds for success in dealing with investors, by learning to think like one. In addition to becoming familiar with the process of financing a new venture, the course focuses on how to build fundamental value within a company and increase a new venture’s investment worthiness. These include concepts like the importance of the opportunity, favorable deal structure, clear customer acquisition strategy, presentation of current and projected financials, mitigating the four components of risk, legal and capital structures, venture capital, private placements, initial public offerings (IPO), mezzanine debt, preferred stock, warrants and other forms of new venture financing.
Finding your way through the Venture Capital gauntletDigital Ignition
Learn about about Finding Your Way Through the Venture Capital Gauntlet with Steve Schilling, President of Convergent. In this one hour session Steve explores: The various types and sources of capital, how to determine when (and if) to raise capital, how to prepare, how the Venture Capitalist’s world works, the ins and outs of valuation and the importance of managing your Cap Table.
How to Split the Pie, Raise Money, and Reward Contributors (Idea To IPO)Roger Royse
What’s my startup worth? How much equity should founders have? How much equity should I give to employees and consultants? How much should I give to the venture capitalists?
Silicon Valley startup attorney Roger Royse of the Royse Law Firm discusses the basic valuation and ownership issues involved in a startup’s life, from formation to financing to exit, including how to value your company and the contributions of stakeholders and investors at each step with a particular emphasis on different models, best practices and traps to avoid.
Know Your Valuation for Equity Compensation (And Avoid the Perils of 409A)The Capital Network
If you are planning to offer anyone stock options - including employees and consultants - then you NEED to understand how to value your company correctly. If you run afoul of the 409A rules, you and your employees could have a very unpleasant tax surprise.
In this workshop, we will cover:
The difference between valuation for 409A and valuation for raising money
The difference between ISOs and non-ISOs
General valuation concepts and approaches that the IRS has outlined, especially as they apply to early-stage companies
If and when you need to engage an outside expert to assist with a valuation
More here: http://www.thecapitalnetwork.org/
Are you thinking about what you need to fund your company? Where do you start? Funding is not “one size fits all”. Every company has to approach their pathway to funding with a unique approach. Join our fundraising experts for an in-depth discussion of what options you have for funding and how to decide which paths are right for you and your company. We’ll have a specific focus on life science focused companies and technologies and the funding choices available.
Experts:
Jeremy Halpern – Nutter McClennen & Fish
Yumin Choi – HLM Venture Partners
Paul Hartung – Cognoptix, Inc
Are you thinking about what you need to fund your company? Where do you start? Funding is not “one size fits all”. Every company has to approach their pathway to funding with a unique approach. Join our fundraising experts for an in-depth discussion of what options you have for funding and how to decide which paths are right for you and your company. We’ll have a specific focus on life science focused companies and technologies and the funding choices available for them.
Exploring Abhay Bhutada’s Views After Poonawalla Fincorp’s Collaboration With...beulahfernandes8
The financial landscape in India has witnessed a significant development with the recent collaboration between Poonawalla Fincorp and IndusInd Bank.
The launch of the co-branded credit card, the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card, marks a major milestone for both entities.
This strategic move aims to redefine and elevate the banking experience for customers.
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
what is the future of Pi Network currency.DOT TECH
The future of the Pi cryptocurrency is uncertain, and its success will depend on several factors. Pi is a relatively new cryptocurrency that aims to be user-friendly and accessible to a wide audience. Here are a few key considerations for its future:
Message: @Pi_vendor_247 on telegram if u want to sell PI COINS.
1. Mainnet Launch: As of my last knowledge update in January 2022, Pi was still in the testnet phase. Its success will depend on a successful transition to a mainnet, where actual transactions can take place.
2. User Adoption: Pi's success will be closely tied to user adoption. The more users who join the network and actively participate, the stronger the ecosystem can become.
3. Utility and Use Cases: For a cryptocurrency to thrive, it must offer utility and practical use cases. The Pi team has talked about various applications, including peer-to-peer transactions, smart contracts, and more. The development and implementation of these features will be essential.
4. Regulatory Environment: The regulatory environment for cryptocurrencies is evolving globally. How Pi navigates and complies with regulations in various jurisdictions will significantly impact its future.
5. Technology Development: The Pi network must continue to develop and improve its technology, security, and scalability to compete with established cryptocurrencies.
6. Community Engagement: The Pi community plays a critical role in its future. Engaged users can help build trust and grow the network.
7. Monetization and Sustainability: The Pi team's monetization strategy, such as fees, partnerships, or other revenue sources, will affect its long-term sustainability.
It's essential to approach Pi or any new cryptocurrency with caution and conduct due diligence. Cryptocurrency investments involve risks, and potential rewards can be uncertain. The success and future of Pi will depend on the collective efforts of its team, community, and the broader cryptocurrency market dynamics. It's advisable to stay updated on Pi's development and follow any updates from the official Pi Network website or announcements from the team.
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
Poonawalla Fincorp and IndusInd Bank Introduce New Co-Branded Credit Cardnickysharmasucks
The unveiling of the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card marks a notable milestone in the Indian financial landscape, showcasing a successful partnership between two leading institutions, Poonawalla Fincorp and IndusInd Bank. This co-branded credit card not only offers users a plethora of benefits but also reflects a commitment to innovation and adaptation. With a focus on providing value-driven and customer-centric solutions, this launch represents more than just a new product—it signifies a step towards redefining the banking experience for millions. Promising convenience, rewards, and a touch of luxury in everyday financial transactions, this collaboration aims to cater to the evolving needs of customers and set new standards in the industry.
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
how to sell pi coins effectively (from 50 - 100k pi)
13-0813 Session 2
1. BEIJING BOSTON BRUSSELS CHICAGO DALLAS FRANKFURT GENEVA HONG KONG HOUSTON LONDON LOS ANGELES NEW YORK PALO ALTO SAN FRANCISCO SHANGHAI SINGAPORE SYDNEY TOKYO WASHINGTON, D.C.
Cleantech Open Webinar –p
Capitalization and Related Topics
Presented by
Sidley Austin’sSidley Austin s
Emerging Companies and Venture Capital Group
Palo Alto, CA
Deborah Marshall Ilan Hornstein
Partner Associate
Email: dmarshall@sidley.com Email: ihornstein@sidley.com
Phone: 650.565.7004 Phone: 650.565.7049
2. AgendaAgenda
• Cap Table Basics
– What is it? What does it mean?
• Actual vs. Pro Forma Cap Tables
• Simple Cap Table• Simple Cap Table
• Overview of Types of Securities
• Who is on the Cap Tablep
• Simple Cap Table
• Vesting – Looking Behind the Cap Table Numbers
• Anti-Dilution Protection
• Series A Term Sheet & Pro Forma Capitalization Table
• Questions• Questions
2
3. Actual and Pro Forma
i li iCapitalization
• Cap Tablep
– Shares Authorized (Theoretical Limit)
– Shares Reserved for Issuance (Planned-for Future Dilution)
Sh O t t di– Shares Outstanding (Actual Current State)
– Fully-Diluted “Outstanding” (Theoretical Current State)
– Convertible Debto e b e eb
• Pro Forma Cap Table
– “As-if” cap table
– Shows impact of a future event, e.g. financing round
or liquidity eventor liquidity event
3
4. Authorized vs. Outstanding
F ll Dil dvs. Fully Diluted
Outstanding Fully Diluted Authorized
Actual outstanding shares
only. Represents the true
current state of the Company
Assumes exercise of certain
issued and issuable convertible
equity securities and includes all
Maximum authorized
amount fixed in Certificate of
Incorporation Can be
4
current state of the Company. equity securities and includes all
outstanding and all reserved
shares.
Incorporation. Can be
increased by amendment of
the Certificate.
5. All Securities
(and Rights to Acquire Securities)( g q )
are on the Cap Table
• Shares
– Ownership of an economic and voting interest (both are very
important and are reflected in the cap table and the charter –
must read both to understand the full picture)
O h t ( t d h )– One share, one vote (even unvested shares)
• Options
– A right to buy shares at a given price (“upside”)
– Then what’s a warrant?
– No voting rights (until buying shares)
• Convertible Debt
– A loan to the company that is convertible into shares and may
have special economic rights on liquidation prior to conversion
– No voting rights (until converted into shares)
5
6. Who is on the Cap Table?
Initial Team Directors EmployeesInitial Team, Directors, Employees,
Consultants, Etc.
• Founder Shares
• Equity Plan (reserved and outstanding
reflected in the cap table)p )
• Spousal rights (not on the cap table but critical
to address))
• Vesting (important but generally not reflected
in the cap table)p )
6
7. Who is on the Cap Table?
lAngel Investors
• Debt vs EquityDebt vs Equity
• Valuation
P t ti C t l• Protection vs Control
• Convert in Equity Round
• Cap on conversion price• Cap on conversion price
7
8. Who is on the Cap Table?
Venture Investors
• Control and ProtectionControl and Protection
• Valuation
i dil i i• Anti-dilution protection
• Follow-on Investment (and “Pay to Play”)
• Voting Protections on Key Events (not
generally reflected on the cap table)g y p )
• Intra-Investor Issues (voting blocks and
balance maybe only partially revealed – seebalance maybe only partially revealed see
voting agreements and charter) 8
9. Simple Cap TableSimple Cap Table
Shares/Units % of F/D
Founder 1 400,000 40.0%Founder 1 400,000 40.0%
Founder 2 200,000 20.0%
Founder 3 200,000 20.0%
College Roommate (Consultant) 10,000 1.0%
N i hb (Ad i ) 10 000 1 0%Neighbor (Advisor) 10,000 1.0%
Total Common Outstanding: 820,000 82.0%
Options
Common Reserved for Pool 200,000
Shares Issued 20,000
Options Outstanding 120 000 12 0%Options Outstanding 120,000 12.0%
Remaining Available for Issuance 60,000 6.0%
Equity Incentive Pool Impact: 180,000 18.0%
9
q y p ,
Total Fully Diluted: 1,000,000 100.0%
10. Simple Cap Table
VOTING POWER
Shares/Units % of F/D
% of
Outstandingg
Founder 1 400,000 40.0% 48.8%
Founder 2 200,000 20.0% 24.4%
Founder 3 200,000 20.0% 24.4%
College Roommate (Consultant) 10 000 1 0% 1 2%College Roommate (Consultant) 10,000 1.0% 1.2%
Neighbor (Advisor) 10,000 1.0% 1.2%
Total Common Outstanding: 820,000 82.0% 100.0%
• Founder 1 can reach majority
without needing another
F dFounder.
• Roommate and Neighbor are
critical swing-votes
10
critical swing-votes
11. Vesting Impacts Distributions on
dLiquidity Events
• Vesting FormulaVesting Formula
– Silicon Valley Standard = 4/1
– Vesting for Founders Sharesg
– Time
– Milestones
• Vesting Commencement Date & Acceleration
– Employeesp y
– Consultants
– Advisors
11
12. Anti-Dilution Protection
• Goal: Protect economic and voting interest
• Triggered by economically dilutive issuances and deemed
issuances
– Exceptions for issuances other than for financing purposesp g p p
• Formula
– Broad-based weighted average
– Full ratchet (rare on west coast)Full ratchet (rare on west coast)
– Strength of protection driven by investor’s view of risk of
investment
• Reflected in the cap table: “as converted to common”Reflected in the cap table: as converted to common
– Impacts voting balance and distribution on liquidity events
Who is diluted by the adjustment?Who is diluted by the adjustment?
12
13. Anti-Dilution Protection:
d b d h dBroad-based Weighted Average
( )BA +( )
C)+(A
BA
CP1=CP2 +
∗
• CP2 = New Conversion Price• CP2 = New Conversion Price
• CP1 = Conversion Price before adjustment
• A = Fully-diluted number of sharesA = Fully diluted number of shares
• B = $ received by Company divided by CP1 (i.e. number
of shares of Common Stock that would have been issued
if issued at a price per share equal to CP1)
• C = Number of shares issued in dilutive issuance
13
15. Anti-Dilution Protection:
l f ffExample of Effect
Series A Price (CP1) 1.00$Se es ce ( ) 00$
Series B Price (Down Round) 0.50$ Series B Pre-Money Value 4,000,000.00$
F/D Number of Shares Pre 8,000,000 Series B $ Invested 4,000,000.00$
Series B Shares Issued 8,000,000 Series B Post-Money Value 8,000,000.00$
F/D Number of Shares Post 16 000 000F/D Number of Shares Post 16,000,000
Ownership, Post
(as converted)
Percent
(F/D)
Liquidation
Preference CP2
S i A I P M 3 200 000 40% 1 600 000 00$Series A Investors Pre-Money 3,200,000 40% 1,600,000.00$
Series A Investors Post-Money
(without anti-dilution adjustment)
3,200,000 20% 1,600,000.00$ 1.00$
Series A Investors Post-Money
4 266 667 27% 2 133 333 33$ 0 75$
(broad-based adjustment)
4,266,667 27% 2,133,333.33$ 0.75$
Series A Investors Post-Money
(full ratchet adjustment)
6,400,000 40% 3,200,000.00$ 0.50$
15
Series A Investors Post-Money
(if Series B price was CP1- $1.00)
3,200,000 27% 2,133,333.33$ 1.00$
16. Series A Term SheetSeries A Term Sheet
TERM SHEET - SERIES A FINANCING FOR STARTUP, INC.
Amount
Investment Amazing Capital $4,000,000
Wealthy Uncle $ 600,000*
Buddy Who Sold Startup to Tech Giant $ 400,000*
Total Series A Round $5,000,000
Valuation Pre-money valuation of $7 million, with a post of $12 million
Price Per Share $0.5506 – Pro-Forma Cap Table attached
B id N t * W lth U l ’ d B dd ’ tibl d bt ( i i l l i t t) t b t dBridge Notes * Wealthy Uncle’s and Buddy’s convertible debt (principal plus interest) to be converted
into Series A per terms and conditions of the notes (20% discount) and their investment
amount above shall be reduced by such amount.
Board 5 Directors: 2 nominated by Common Stock (initially, the Company’s CEO and CTO), 2
C ( )nominated by Amazing Capital (initially, John Doe and Jane Amazing), and 1
independent director jointly elected (initially left vacant)
16
17. Series A Term Sheet
d- continued -
V ti & F d 30% f h t d t bj t t ti h d l t b dVesting & - Founders: 30% of shares vested, rest subject to vesting per schedule to be agreed
Incentive Pool upon prior to closing. At change of control, double trigger acceleration on
50% of remaining unvested shares and options held by Founders
- Non-Founders: four year monthly vesting with one year cliff
- Option Pool to be increased so 15% post-money available for grant
Conversion At holder’s option, compulsory on majority vote of Preferred Stock (voting together as a
single class), and automatically upon IPO at 5X original price ($2.75+/share)
Dividends 6% non-cumulative, if and when declared by Board
Liquidation Pref. Non-participating; 1X original purchase price plus declared dividends
Anti-dilution Standard; Broad-based weighted averageAnti dilution Standard; Broad based weighted average
Voting Rights Approval of majority of the Preferred Stock on customary protective provisions
17
18. Series A Term Sheet
d- continued -
ROFR & Co-Sale Company ROFR on all shares of capital stock held by Founders and Key Employees,
assignable to the investors if not exercised by the Company. Co-sale rights for investors
on any shares not purchased pursuant to the ROFR.
Closing - Closing to occur on or before August 31 2013Closing Closing to occur on or before August 31, 2013
Conditions - Employees and Founders sign proprietary information agreement
- Completion of legal and financial due diligence and founder references
- Opinion of counsel
Documentation Definitive documentation will contain other standard and customary rights, preferencesDocumentation Definitive documentation will contain other standard and customary rights, preferences
and privileges. Documents to be drafted by counsel for _______________.
Fees & Expenses Company will reimburse legal fees of Amazing Capital up to $______________.
18
19. Series A Pro Forma Cap TablePost-Money Capitalization
Pre-Money Capitalization
(i.e. Post 10:1 Split & Pool Increase)
Prior Capitalization
Series A Preferred Stock:
New Money
Shares
Note Conv.
Shares Total Shares
% of
F/D
% of
Preferred
Amazing Capital 7,264,802 - 7,264,802 32.8% 76.9%
Wealthy Uncle 127,134 1,203,178 1,330,312 6.0% 14.1%
Buddy Who Sold Startup 245,187 601,589 846,776 3.8% 9.0%
Total Series A Outstanding: 7,637,123 1,804,767 9,441,890 42.6% 100.0%
Common Stock: Total Common
% of
F/D
Total
Common
% of
F/D Total Common
% of
F/D
Founder 1 400,000 40.0% 4,000,000 31.5% 4,000,000 18.1%
Founder 2 200,000 20.0% 2,000,000 15.7% 2,000,000 9.0%
Founder 3 200,000 20.0% 2,000,000 15.7% 2,000,000 9.0%
College Roommate 10,000 1.0% 100,000 0.8% 100,000 0.5%
Neighbor 10,000 1.0% 100,000 0.8% 100,000 0.5%
Total Common Outstanding: 820 000 82 0% 8 200 000 64 5% 8 200 000 37 0%Total Common Outstanding: 820,000 82.0% 8,200,000 64.5% 8,200,000 37.0%
Equity Incentive Plan:
Common Reserved for Pool 180,000 1,800,000 4,512,650
Increase in Pool - 2,712,650
Options Outstanding 120,000 12.0% 1,200,000 9.4% 1,200,000 5.4%
Remaining Available for Issuance 60,000 6.0% 3,312,650 26.1% 3,312,650 15.0%
Common + Pool: 1,000,000 100.0% 12,712,650 100.0% 12,712,650 57.4%
Total Fully Diluted: 1,000,000 100.0% 12,712,650 100.0% 22,154,540 100.0%
Convertible Notes: Principal
Principal +
Interest Discount
Conversion
Price
W lth U l 500 000 00$ 530 000 00$ 20% $ 0 4405
Note: Discount is reflected in
Wealthy Uncle 500,000.00$ 530,000.00$ 20% $ 0.4405
Buddy Who Sold Startup 250,000.00$ 265,000.00$ 20% $ 0.4405
Total Outstanding: $ 750,000.00 $795,000.00
$
Details of Investment in Series A Round
Valuation
conversion price,which is 20%
lower than the SeriesA Price.
19
Pre-Money Valuation
Price Per Share
New Money In
Notes Converted Amazing $ - $ - $ - $ 4,000,000.00 $ 4,000,000.00
Total Round Uncle $500,000.00 $30,000.00 $ 530,000.00 $ 70,000.00 $ 600,000.00
Buddy $250,000.00 $15,000.00 $ 265,000.00 $ 135,000.00 $ 400,000.00
Post-Money Valuation Total $750,000.00 $45,000.00 $ 795,000.00 $ 4,205,000.00 $ 5,000,000.00
$ 795,000.00
$ 12,000,000.00
$ 4,205,000.00
$ 5,000,000.00
$ 7,000,000.00
Principal Interest
$ 0.5506
Note Total
(P+I)
New
Money
Total Investment
in Round
20. Key Emerging Company Relationships
Non-
Practicing
EntitiesImplementation
Former
Employer Formation
Consultants
University
NEWCO
Employees
Co-
founders
Advisers Spouse
Board
Strategic Venture
Angel
Investors
Partners Investors
Validation 20
21. OUR GLOBAL COVERAGE:OUR GLOBAL COVERAGE:
Global Reach
Approximately 1,700 lawyers in
19 ffi ld id19 offices worldwide
Our offices are located in critical
financial and commercial centers
8 offices in the US totaling 1,420
lawyers
4 offices in Europe totaling 160
lawyers with a significant
corporate and securities practice
in London
6 offices in Asia Pacific totaling
130 l h ti130 lawyers who are native-
speaking or fluent in languages
including Korean, Mandarin,
Cantonese, Taiwanese and
Japanese as well as English
Handle work in dozens ofHandle work in dozens of
languages
21
22. Thanks for Inviting Us!
Deborah Marshall
Partner
M&A
Deborah A. Marshall is a partner with the firm and concentrates her practice on strategic
business counseling for emerging growth companies and investors at all stages of development,
from start-up entrepreneurs to publicly traded entities and technology-based, multinational
tiM&A
Emerging Companies
Venture Capital
Technology Transactions
+1.650.565.7004
corporations.
Ms. Marshall has advised issuers, investors and investment banking firms in the internet,
software, electronics, clean technology, media, entertainment, biopharmaceutical, genomics,
medical device and diagnostics sectors. She has significant experience in venture capital
financing, mergers and acquisitions, public offerings, private equity and strategic partnerships.
Ms. Marshall is a frequent speaker on issues related to venture capital, emerging growth
dmarshall@sidley.com companies, life sciences, public securities and entrepreneurship. She has been a guest lecturer
on entrepreneurship at the University of California Berkeley Haas School of Business, as well as a
member of the faculty of the Haas Business School’s Global Bio-Executive Program.
Ilan Hornstein
Associate
Emerging Companies
Venture Capital
Ilan B. Hornstein’s practice encompasses a variety of business and transactional matters, including
domestic and cross-border acquisitions, technology transactions, energy project developments,
complex secured and unsecured debt financings, and general corporate matters. His clients include
domestic and international private and public companies, banks and other financial institutions,
private equity firms, and governmental entities.p
Technology Transactions
+1.650.565.7049
ihornstein@sidley.com
To better serve and understand his clients, Mr. Hornstein draws on over four years of domestic and
international business experience he gained prior to law school. An electrical engineer by training, he
has worked in the finance, business development, strategic planning, and information technology
departments of a large defense contractor. In addition, he is Raytheon Six Sigma certified and a
graduate of Raytheon’s Leadership Development Program. He has worked in Germany, the United
Kingdom and the United States.
Mr. Hornstein is fluent in English and German.
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