Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist, 2nd Edition

Appendix A: Sample Term Sheet*

ACME VENTURE CAPITAL 2011, L.P.

Summary of Terms for Proposed Private Placement

of Series A Preferred Stock of

NEWCO.COM

__________, 20___

(Valid for acceptance until _______, 20___)

Issuer:	NEWCO.COM (the “Company”)
Investor(s):	Acme Venture Capital 2011, L.P. and its affiliated partnerships (“Acme”) [and others, if applicable] (“Investors”).
Amount of Financing:	An aggregate of $__ million, [(including $__ from the conversion of outstanding bridge notes)] representing a__% ownership position on a fully diluted basis, including shares reserved for any employee option pool. [The individual investment amounts for each Investor are as follows: Acme $__________ Other investor 1 $__________ Other investor 2 $__________ Total: $__________ ] [If there is to be a second closing, differentiate the investors and amounts by each closing.]
Price:	$_____ per share (the “Original Purchase Price”). The Original Purchase Price represents a fully diluted premoney valuation of $__ million and a fully diluted postmoney valuation of $__ million. [A capitalization table showing the Company's capital structure immediately following the Closing is attached.] For purposes of the above calculation and any other reference to “fully diluted” in this term sheet, “fully diluted” assumes the conversion of all outstanding preferred stock of the Company, the exercise of all authorized and currently existing stock options and warrants of the Company, and the ...