"Series Seed financing can be defined as when investment in the company is exchanged for preferred stock. If you have preferred stock, your dividends must be paid to you before that of common shareholders. However, if you have preferred shares you have sacrificed your voting rights.
Preferred stock pays fixed dividends and has also the potential to appreciate in price. That is to say, it combines features of debt and equity.
Preferred stock usually yields more than common stock, and it can be paid every month or every quarter. The dividends are fixed or set according to a benchmark interest rate. The dividend yield is influenced by adjustable-rate shares, and participating shares are able to pay more dividends that calculated by common stock dividends or business profits.
This is a template for agreeing on preferred stock purchases for your company to use when working with investors."
North Carolina Series Seed Preferred Stock Purchase Agreement
State:
Multi-State
Control #:
US-ENTREP-0039-4
Format:
Word;
Rich Text
Instant download
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How to fill out Series Seed Preferred Stock Purchase Agreement?
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FAQ
Series Seed Preferred Shares means the Series Seed Preferred Shares of the Company, par value US$0.001 per share, with the rights, preferences, and privileges as set forth in the Memorandum and Articles. Series Seed Preferred Shares means the Company's Series Seed Preferred Shares, par value US$0.000005 per share.
Series Seed Preferred Stock is a type of preferred stock issued by startups during their early stage of development. Preferred stock is a hybrid security that combines elements of both debt and equity.
In a preferred stock financing, the Stock Purchase Agreement contains the terms of the stock purchase, representations and warranties of both the issuing company and the purchaser and conditions to closing.
This means that the Seller is entitled to the cash on the balance sheet on the closing date of the transaction, and that the Seller is responsible for debts owed by the company (defined as Indebtedness).
A SPA should specify the sale price for the shares, specify the currency and timescale for the sale, and list any other conditions like staged payments. Usually, payment is made in cash, although sometimes the buyer may offer the seller some of its shares, or issue loan notes to the seller.
How to draft a purchase agreement Name and contact information for buyer and seller. The address of the property being sold. The price to be paid for the property. The date of transfer. Disclosures. Contingencies. Signatures.
A stock purchase agreement typically includes the following information: Your business name. The name and mailing address of the entity buying shares in your company's stocks. The par value (essentially the sale price) of the stocks being sold. The number of stocks the buyer is purchasing.
A Share Purchase Agreement generally includes information about: The person selling the shares. The person buying the shares. The number of shares being sold and their value. The company the shares are being transferred from. The number of shares being sold and their value.