VC Term Sheets – Investors’ Option to Walk

Introduction

This post originally appeared in the “Ask the Attorney” column I am writing for VentureBeat; it is part of my ongoing series regarding 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
• drag-along provisions
• pay-to-play and pull-up provisions
• conversion rights
• non-contractual rights
• redemption rights

In today’s post, I examine the non-binding and conditional language in term sheets.

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Tags: due diligence, exploding term sheets, founders, Fred Wilson, investors' option, liquidation preferences, no shop, Rand Fish, redemption rights, startup, vc, VC term sheet, venture capital
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