You have successfully incorporated your new startup company and are all set to grow your business. What is one of the first things you should do? Without a doubt, if you have two or more shareholders, you should consider a shareholders’ agreement. It is easy to postpone putting a shareholders’ agreement (aka founders’ agreement) in place, but it is important. Why? Because it can regulate how changes in the company in the future will be dealt with including how decisions will be made, what would happen if a shareholder wanted to leave or became ill and, most importantly, what would happen if the shareholders had a disagreement.
If you are a founder, entrepreneur or a potential investor, at some stage you are likely to encounter a term sheet. So, what are term sheets actually for and what issues do you need to consider?
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