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VC Term Sheets – Drag-Along Provisions
by Scott Edward Walker on May 5th, 2011Introduction
This post originally appeared as part of the “Ask the Attorney” column I am writing for VentureBeat. Below is a longer, more comprehensive version, which is part of my ongoing series on venture capital term sheets. Here are the issues I have addressed to date:
- common mistakes dealing with VC’s
- valuation
- liquidation preferences
- stock options
- exploding term sheets and no-shop provisions
- anti-dilution provisions
- dividends
- Board control
- protective provisions
In today’s post, I examine “drag-along” or “bring-along” provisions, which can be very tricky.
VC Term Sheets – Protective Provisions
by Scott Edward Walker on April 7th, 2011Introduction
This post originally appeared as part of the “Ask the Attorney” column I am writing for VentureBeat. Below is a longer, more comprehensive version, which is part of my ongoing series on venture capital term sheets. Here are the issues I have addressed to date:
- common mistakes dealing with VC’s
- valuation
- liquidation preferences
- stock options
- exploding term sheets and no-shop provisions
- anti-dilution provisions
- dividends
- Board control
Today’s post relates to protective provisions, which is something VC investors almost always require in a priced round (i.e., the issuance of preferred stock), as opposed to the issuance of convertible notes.