Document background
The Funding Term Sheet serves as a crucial preliminary document in Danish investment transactions, typically used when a company is seeking to raise capital through equity or convertible instruments. It provides a structured summary of the key commercial and legal terms that will form the basis of the final investment agreements. While primarily non-binding, the term sheet helps align parties' expectations early in the negotiation process and streamlines the path to final documentation. Under Danish law, particular attention must be paid to compliance with the Danish Companies Act regarding share classes, corporate governance, and capital requirements. The document is especially important in venture capital and private equity transactions, where it helps establish clear parameters for valuation, investor rights, board composition, and exit provisions before significant resources are committed to full documentation.
