Rights & Preferences: BOD Rights

Posted by Dan Eyman | May 24th, 2016 | No responses

What is a Board of Directors (BOD)? The BOD is the governing body of a company and approves (ratifies) all major decisions, including but not limited to selling the company, going public (IPO), debt financing, equity financing, and more. Basically, on all major “stuff” the Board will be involved and […]

Rights & Preferences: What You Need to Know About Dividends

Posted by Dan Eyman | May 19th, 2016 | No responses

These are not usually a real point of negotiation with venture capital term sheets but we have seen terms that can be dilutive to founders and its best to understand what these terms mean and how they affect you and your company. First I want to take a moment to […]

Rights & Preferences: Conversion Rights

Posted by Dan Eyman | May 15th, 2016 | No responses

What is a Conversion Right? Investors are issued¬†Preferred stock and not common stock. Preferred stock typically has more economic value than common stock due to the rights and preferences that are granted with the issuance of such stock. One of these rights and preferences is conversion rights. A conversion right […]

Rights & Preferences: The Liquidation Preference

Posted by Dan Eyman | December 4th, 2015 | No responses

The liquidation preference is the key differentiating factor between the common and preferred share. The liquidation preference gives the preferred shareholder, typically a venture capitalist, the first priority to any proceeds upon a liquidation of the company. A pause here to understand the difference between a liquidation event and a […]

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