TERM SHEET FOR ALLIANCE OF ANGELS

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I. Introduction

This Term Sheet ("Term Sheet") outlines the key terms and conditions of the investment or partnership deal between [Your Company Name] and the Alliance of Angels, a group of angel investors ("Investors"). The purpose of this Term Sheet is to provide a comprehensive framework for the proposed investment or partnership, ensuring clarity and understanding between the parties involved.

II. Parties Involved

1. [Your Company Name]:

• Address: [Your Company Address]

• Contact Person: [Your Name]

• Contact Information: [Your Email], [Your Number]
  

2. Alliance of Angels:

• Address: [Alliance of Angels Address]

• Contact Person: [Investor Contact Name]

• Contact Information: [Investor Email Address], [Investor Phone Number]

III. Investment Details

The investment details section delineates the financial aspects and obligations associated with the investment from the Alliance of Angels.

1. Investment Amount: The Alliance of Angels agrees to invest a total amount of $5,000,000 in [Your Company Name]. This investment is intended to support the growth and development of [Your Company Name] under mutually agreed-upon milestones and objectives.

2. Valuation: The pre-money valuation of [Your Company Name] is $20,000,000. This valuation serves as a basis for determining the equity offered to the Alliance of Angels in exchange for their investment.

3. Equity Offered: In consideration for the investment, [Your Company Name] agrees to issue 25% of its equity to the Alliance of Angels. The distribution of equity reflects the proportional ownership stake acquired by the Investors in [Your Company Name].

4. Investor Rights: The Alliance of Angels shall be entitled to specific rights and privileges as part of their investment, including:

• Board Representation: The Investors shall have the right to appoint 2 board members to the board of directors of [Your Company Name], ensuring strategic input and oversight.
  

• Protective Provisions: The Investors shall have certain protective provisions, including but not limited to, the right to approve any change in control transactions or amendments to the company's organizational documents. These provisions safeguard the interests of both parties and promote transparent decision-making.

IV. Key Terms and Conditions

The key terms and conditions section elaborates on various operational aspects and responsibilities associated with the investment or partnership.

1. Use of Funds: The investment amount will be utilized by [Your Company Name] for strategic initiatives and operational activities essential for achieving growth and market competitiveness. These may include:

• Product Development: Enhancing existing products or developing new offerings to meet market demands and customer expectations.
  

• Marketing and Sales Expansion: Increasing brand visibility, implementing targeted marketing campaigns, and expanding sales channels to reach a wider audience.
  

• Working Capital: Ensuring sufficient liquidity and financial resources to sustain day-to-day operations and facilitate business expansion.
  

2. Milestones: [Your Company Name] agrees to achieve specific milestones within defined timeframes to demonstrate progress and value creation. These milestones may encompass:

• Revenue Targets: Achieving predetermined revenue goals through sales growth and market penetration strategies.
  

• Product Launches: Successfully launching new products or services as per the agreed-upon roadmap.
  

• Operational Efficiency: Improving operational processes and efficiencies to enhance productivity and reduce costs.
  

3. Term and Termination: This Term Sheet shall remain valid until a definitive agreement is reached or until terminated by mutual agreement of both parties. Termination clauses may include provisions for notice periods and procedures for winding down the investment or partnership in an orderly manner.

V. Confidentiality

Confidentiality is paramount in all dealings between [Your Company Name] and the Alliance of Angels. Both parties agree to maintain strict confidentiality regarding all information shared during negotiations and under this Term Sheet, except as required by law or with explicit consent.

VI. Governing Law

This Term Sheet shall be governed by and construed under the laws of the State of [Your State], without regard to its conflict of laws principles. Any disputes arising from or related to this Term Sheet shall be resolved through amicable negotiations or, if necessary, through legal proceedings in the appropriate jurisdiction.

VII. Signatures

This Term Sheet represents a preliminary understanding between [Your Company Name] and the Alliance of Angels and is subject to final approval and execution by authorized representatives of both parties.

[Your Name]

[Your Title]

[YOUR COMPANY NAME]

[Investor Contact Name]

[Investor Title]

Alliance of Angels

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