3 ms·
A brief summary of important terms (IANAL, this is just a quick read): - This has 1x preference and no participation. - Pro-rata rights are available to some
by danshapiro 16y ago
A brief summary of important terms (IANAL, this is just a quick read):
- This has 1x preference and no participation.
- Pro-rata rights are available to some shareholders.
- Ditto information rights.
- The preferred has a veto over selling the company that can be exercised with a simple majority.
- Lots of stuff not included: board seat, drag along, antidilution, redemption rights, employee option pool (!), restriction on sales, or a no-shop.
Overall mostly VERY favorable to the entrepreneurs, mostly by virtue of what's been left out. The one notable exception is the prefered's veto over an exit, which is a big ouch.