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Incorporation

Key Considerations When Deciding Where To Incorporate

How To Incorporate a Delaware C Corp Through Clerky?

Form Of SOSV Program Investments

How are SOSV Program Investments Made?

What Is A SAFE?

What Does Post-Money Mean?

How Does a Post-Money Fixed Percentage SAFE Convert to Equity?

Structure of the SOSV Program Investment

Structure of the SOSV Program Investment

Cash SAFE

Program SAFE

Additional Cash SAFE

Cash SAFE

Cash Amount

Conversion – Valuation Cap Or Discount?

What Events Trigger Conversion of Investment to Equity?

What is an Equity Financing?

What Calculation is Used to Determine the Number of Shares Issuable to the Investor Upon Conversion of the Cash SAFE?

What is an Optional Conversion?

What is a Liquidity Event?

What is a Dissolution Event?

What is a Review Conversion

What is a Pro Rata Right?

What is a Most Favored Nations Clause?

What Is an Employee Share Option Plan (ESOP) or Unissued Option Pool?

Can the Cash SAFE be Assigned?

Program SAFE

Program Amount

Conversion to a Fixed Percentage

What Events Trigger Conversion of Investment to Equity?

What is an Equity Financing?

What Calculation Is Used to Determine the Number of Shares Issuable to the Investor Upon Conversion of the Program SAFE?

What is an Optional Conversion?

What is a Dissolution Event?

A Dissolution Event is quite different from a Liquidity Event discussed above.  A Dissolution Event generally means that your Company has voluntarily or involuntarily taken steps to dissolve or be wound up. In this case, SOSV has a “Liquidation Preference”.

A Liquidation Preference provides a preferential entitlement to, generally, a 1x liquidation preference, which would be equal to the direct cost of having financed and supported the Company through the relevant SOSV Program via the program costs and direct cash investment.

SOSV invests in companies with a view to being involved with these companies throughout each company’s life cycle, and building a strong relationship with the Founders. Put simply, this clause ensures that SOSV at a minimum can recover the costs of putting your Company through the SOSV Program, so that SOSV can find a new long term investment for the next Program. 

What is a Liquidity Event?

What is a Review Conversion?

What is a Pro Rata Right?

What is an Employee Share Option Plan (ESOP) or Unissued Option Pool?

What Representations and Warranties are Given with Respect to the Company’s Intellectual Property?

What are SOSV’s Vesting Requirements?

What is a Most Favored Nations Clause?

What is a Put Right?

What is an Observer Right?

What are Information Rights?

What is the Major Investor Designation Clause?

What is a Pre Conversion Pro Rata Right?

What is a First Financing Right?

What is the Investor Consent Matters Clause?

What are the Program Participation Requirements?

What Happens if a Participant is Removed From the Program?

What Does the Exit Endeavour Clause Mean?

Can the Program SAFE be Assigned?

Optional Additional Cash SAFE

What is an Additional Cash SAFE?