[{"data":1,"prerenderedAt":519},["ShallowReactive",2],{"document-preferred-stock-purchase-agreement-D12854":3},{"document":4,"label":23,"preview":11,"thumb":24,"thumb600":25,"description":5,"descriptionCustom":6,"apiDescription":5,"pages":8,"extension":10,"parents":26,"breadcrumb":30,"related":38,"customDescModule":178,"customdescription":6,"mdFm":179,"mdProseHtml":518},{"description":5,"descriptionCustom":6,"label":7,"pages":8,"size":9,"extension":10,"preview":11,"thumb":12,"svgFrame":13,"seoMetadata":14,"parents":16,"keywords":15},"PREFERRED STOCK PURCHASE AGREEMENT This Preferred Stock Purchase Agreement (the \"Agreement\") is effective [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"Company\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE] with its head office located at: [YOUR COMPLETE ADDRESS] AND: [SECOND PARTY NAME] (the \"Purchaser\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS, the Company has authorized the sale and issuance of an aggregate of [TOTAL SHARES] shares of its Series A Preferred Stock (the \"Shares\"); WHEREAS, the Purchaser desires to purchase the Shares on the terms and conditions set forth herein; WHEREAS, the Company desires to issue and sell the Shares to the Purchaser on the terms and conditions set forth herein. NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS: AGREEMENT TO SELL AND PURCHASE Authorization of Shares: The Company has authorized (a) the sale and issuance to the Purchaser of the Shares and (b) the issuance of such shares of Common Stock to be issued upon conversion of the Shares (the \"Conversion Shares\"). The Shares and the Conversion Shares have the rights, preferences, privileges and restrictions set forth in the Amended and Restated Certificate of Incorporation of the Company, in the form attached hereto as Exhibit B (the \"Restated Charter\"). Sale and Purchase: Subject to the terms and conditions hereof, at the Closing (as hereinafter defined), the Company hereby agrees to issue and sell to each Purchaser, and each Purchaser agrees to purchase from the Company, severally and not jointly, the number of Shares set forth opposite such Purchaser's name on Exhibit A, at a purchase price of $ [______________] per Share. CLOSING, DELIVERY AND PAYMENT Closing: The closing of the sale and purchase of the Shares under this Agreement (the \"Closing\") shall take place at [TIME] a.m./ p.m. on [DATE], at the offices of [OFFICE/COMPANY NAME] in [CITY] or at such other time or place as the Company and the Purchaser may mutually agree. (Such date is hereinafter referred to as the \"Closing Date.\") Delivery: At the Closing, subject to the terms and conditions hereof, the Company will deliver to each Purchaser a certificate representing the number of Shares to be purchased at the Closing by such Purchaser, against payment of the purchase price therefor by check, wire transfer made payable to the order of the Company, cancellation or conversion of indebtedness or any combination of the foregoing. If payment by a Purchaser is made, in whole or in part, by cancellation or conversion of indebtedness, then such Purchaser shall surrender to the Company for cancellation or conversion at the Closing any evidence of such indebtedness or shall execute an instrument of cancellation or conversion in form and substance acceptable to the Company. In addition, the Company at the Closing shall deliver to any Purchaser choosing to pay any part of the purchase price of the Series A Preferred Stock by cancellation or conversion of indebtedness a check in the amount of any interest on such indebtedness through the Closing not being converted. REPRESENTATIONS AND WARRANTIES OF THE COMPANY Except as set forth on a Schedule of Exceptions delivered by the Company to the Purchaser at the Closing, the Company hereby represents and warrants to the Purchaser as of the date of this Agreement as set forth below. Organization, Good Standing and Qualification: The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of [STATE/PROVINCE]. The Company has all requisite corporate power and authority to own and operate its properties and assets, to execute and deliver this Agreement and the Investor Rights Agreement in the form attached hereto as Exhibit C (the \"Investor Rights Agreement\"), the Co-Sale Agreement in the form attached hereto as Exhibit D (the \"Co-Sale Agreement\"), the Voting Agreement in the form attached hereto as Exhibit E (the \"Voting Agreement\") and the Management Rights Letter in the form attached hereto as Exhibit F (collectively, the \"Related Agreements\"), to issue and sell the Shares and the Conversion Shares, and to carry out the provisions of this Agreement, the Related Agreements and the Restated Charter and to carry on its business as presently conducted and as presently proposed to be conducted. The Company is duly qualified to do business and is in good standing as a foreign corporation in all jurisdictions in which the nature of its activities and of its properties (both owned and leased) makes such qualification necessary, except for those jurisdictions in which failure to do so would not have a material adverse effect on the Company or its business. Subsidiaries: The Company does not own or control any equity security or other interest of any other corporation, partnership, limited liability company or other business entity. The Company is not a participant in any joint venture, partnership, limited liability company or similar arrangement. Since its inception, the Company has not consolidated or merged with, acquired all or substantially all of the assets of, or acquired the stock of or any interest in any corporation, partnership, limited liability company or other business entity. Capitalization; Voting Rights: The authorized capital stock of the Company, immediately prior to the Closing, consists of (i) [________________] Shares of Common Stock, [____________________] Shares of which are issued and outstanding, and (ii) [____________________] Shares of Preferred Stock, all of which are designated Series A Preferred Stock, none of which are issued and outstanding. Under the Company's [YEAR] Equity Incentive Plan (the \"Plan\"), (i) no shares have been issued pursuant to restricted stock purchase agreements and/or the exercise of outstanding options, (ii) no options have been granted and are currently outstanding and (iii) [_______________________________] shares of Common Stock remain available for future issuance to officers, directors, employees and consultants of the Company. The Company has not made any representations regarding equity incentives to any officer, employee, director or consultant that are inconsistent with the Share amounts and terms set forth in the Company's board minutes. Other than the Shares reserved for issuance under the Plan and except as may be granted pursuant to this Agreement and the Related Agreements, there are no outstanding options, warrants, rights (including conversion or pre-emptive rights and rights of first refusal), proxy or stockholder agreements or agreements of any kind for the purchase or acquisition from the Company of any of its securities. All issued and outstanding Shares of the Company's Common Stock [and Preferred Stock] (i) have been duly authorized and validly issued and are fully paid and non-assessable, (ii) were issued in compliance with all applicable state and federal laws concerning the issuance of securities; and (iii) with respect to Common Stock only, are subject to a right of first refusal in favour of the Company upon transfer. The rights, preferences, privileges, and restrictions of the Shares are as stated in the Restated Charter. Each outstanding series of Preferred Stock is convertible into Common Stock on a one-for-one basis as of the date hereof, and the consummation of the transactions contemplated hereunder will not result in any anti-dilution adjustment or other similar adjustment to the outstanding Shares of Preferred Stock. The Conversion Shares have been duly and validly reserved for issuance",null,"Preferred Stock Purchase Agreement","20",513,"doc","https://templates.business-in-a-box.com/imgs/1000px/preferred-stock-purchase-agreement-D12854.png","https://templates.business-in-a-box.com/imgs/250px/12854.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12854.xml",{"title":15,"description":6},"preferred stock purchase agreement",[17,20],{"label":18,"url":19},"Finance & Accounting","/templates/finance-accounting/",{"label":21,"url":22},"Shareholders & Investors","/templates/shareholders-investors/","Preferred Stock Purchase Agreement Template","https://templates.business-in-a-box.com/imgs/400px/12854.png","https://templates.business-in-a-box.com/imgs/600px/12854.png",[27,17,20],{"label":28,"url":29},"Templates","/templates/",[31,32,35],{"label":28,"url":29},{"label":33,"url":34},"Legal Agreements","/templates/business-legal-agreements/",{"label":36,"url":37},"Equity & Mergers","/templates/equity-and-mergers/",[39,43,47,51,55,59,63,67,71,75,79,83,87,102,116,133,148,163],{"label":40,"url":41,"thumb":42,"extension":10},"Stock Purchase Agreement","/template/stock-purchase-agreement-D349","https://templates.business-in-a-box.com/imgs/250px/349.png",{"label":44,"url":45,"thumb":46,"extension":10},"Agreement for Redemption of Preferred Shares","/template/agreement-for-redemption-of-preferred-shares-D316","https://templates.business-in-a-box.com/imgs/250px/316.png",{"label":48,"url":49,"thumb":50,"extension":10},"Restricted Stock Purchase Agreement","/template/restricted-stock-purchase-agreement-D12855","https://templates.business-in-a-box.com/imgs/250px/12855.png",{"label":52,"url":53,"thumb":54,"extension":10},"Stock Agreement","/template/stock-agreement-D347","https://templates.business-in-a-box.com/imgs/250px/347.png",{"label":56,"url":57,"thumb":58,"extension":10},"Agreement of Purchase and Sale of Shares","/template/agreement-of-purchase-and-sale-of-shares-D322","https://templates.business-in-a-box.com/imgs/250px/322.png",{"label":60,"url":61,"thumb":62,"extension":10},"Stock Subscription Agreement","/template/stock-subscription-agreement-D350","https://templates.business-in-a-box.com/imgs/250px/350.png",{"label":64,"url":65,"thumb":66,"extension":10},"Offer to Purchase Shares Agreement","/template/offer-to-purchase-shares-agreement-D334","https://templates.business-in-a-box.com/imgs/250px/334.png",{"label":68,"url":69,"thumb":70,"extension":10},"Purchase Agreement","/template/purchase-agreement-D12670","https://templates.business-in-a-box.com/imgs/250px/12670.png",{"label":72,"url":73,"thumb":74,"extension":10},"Agreement of Purchase and Sale of Shares by Shareholder","/template/agreement-of-purchase-and-sale-of-shares-by-shareholder-D321","https://templates.business-in-a-box.com/imgs/250px/321.png",{"label":76,"url":77,"thumb":78,"extension":10},"Agreement of Purchase and Sale of Shares 2","/template/agreement-of-purchase-and-sale-of-shares-2-D320","https://templates.business-in-a-box.com/imgs/250px/320.png",{"label":80,"url":81,"thumb":82,"extension":10},"Stock Lending Agreement","/template/stock-lending-agreement-D14067","https://templates.business-in-a-box.com/imgs/250px/14067.png",{"label":84,"url":85,"thumb":86,"extension":10},"Employee Stock Option Agreement","/template/employee-stock-option-agreement-D12613","https://templates.business-in-a-box.com/imgs/250px/12613.png",{"description":88,"descriptionCustom":6,"label":89,"pages":90,"size":91,"extension":10,"preview":92,"thumb":93,"svgFrame":94,"seoMetadata":95,"parents":96,"keywords":100,"url":101},"CONVERTIBLE NOTE AGREEMENT This Convertible Note Agreement (\"Agreement\") is made and effective the [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"Company\"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [NOTE HOLDERS NAME] (the \"Note Holders\"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS, Note Holders are willing to lend Company the aggregate sum of [AMOUNT] be evidenced by [%] Convertible Promissory Notes. In consideration of the mutual covenants and conditions herein contained, the parties hereby agree, represent and warrant as follows: Issue of Notes The Company will authorize the issue of its [%] Convertible notes (hereinafter called \"Notes\") in the aggregate principal amount of [amOUNT] to be dated [date] to mature on [date] to bear interest on the unpaid principal thereof at the rate of [%] per annum until maturity, payable on the [day] of [month] in each year, commencing on [date], [year], and after maturity at the rate of [%] per annum until paid, and to be substantially in the form of Exhibit A attached hereto. For the purposes of calculating interest for any period for which the interest shall be payable, such interest shall be calculated on the basis of a [number] day month and a [number] day year. The Company will promptly and punctually pay to Note Holders or their nominee the interest on any of the Notes held by Note Holders without presentment of the Notes. In the event that Note Holders shall sell or transfer any of the Notes, they shall notify the Company of the name and address of the transferee. In the event the Company defaults on any installment of interest or principal, then any Holder of these Notes may, at his option, without notice, declare the entire principal and the interest accrued thereon immediately due and payable and may proceed to enforce the collection thereof. All the Notes shall contain a confession of judgment provision. The Company will also authorize the issue of [number] shares of its common stock (hereinafter called \"The Stock\") and will authorize the issuance of and reserve for such purchase such a number of additional shares of common stock (hereinafter called the \"Conversion Stock\") as may from time to time be the maximum number required for issuance upon conversion of the Notes pursuant to the conversion privileges hereinafter stated. Sale and Purchase of Notes and Stock The Company will sell the Notes to the purchasers listed on Exhibit A, each of whom agrees to purchase the principal amount of the Notes set opposite their names, subject to the terms and conditions hereof and in reliance upon the representations and warranties of the Company contained herein, at the purchase price of [%] of the principal amount. Representations and Warranties by the Company Company is a corporation duly organized and existing in good standing under the laws of the State of [state/province] has the corporate power to own its own property and to carry on in the business as it is now being conducted. Company has on its corporate records the names of the following individuals who each own [number] shares of common stock which constitute all the issue and outstanding capital stock of the Company as of this date. The Company has furnished to the Note Holders an Offering Circular which is attached hereto as Exhibit B. The financial statements contained therein are true and correct and have been prepared in accordance with generally accepted accounting principles consistently followed throughout the period indicated. There is no action or proceeding pending or, to the knowledge of the Company, threatened against the Company before any court or administrative agency, the determination of which might result in any material adverse change in the business of the Company. The Company has title to the respective properties and assets including the properties and assets reflected on the financial statement for the year ending [date] and which assets and properties are subject to no liens, mortgages, encumbrances or charges except a security interest to [specify]. The Company is not a party to any contract or agreement or subject to any restriction which materially and adversely affects its business, property or assets, or financial condition, and neither the execution nor delivery of this Agreement, nor the confirmation of the transactions contemplated herein, nor the fulfillment of the terms hereof, nor the compliance with the terms and provisions hereof and of the Notes, will conflict with or result in the breach of the terms, conditions or provisions or constitute a default, under the Articles of Incorporation or Code of Regulations of the Company or of any Agreement or instrument to which the Company is now a party. The Company has not declared, set aside, paid or made any dividend or other distributions with respect to its capital stock and has not made or caused to be made directly or indirectly, any payment or other distribution of any nature whatsoever to any of the holders of its capital stock except for regular salary payments for services rendered and the reimbursement of business expenses. All of the equipment and automobiles of the Company are in good condition and repair. There are no outstanding options or rights to purchase shares of the Company and no outstanding securities with the right of conversion into shares of the Company. The Company owns or possesses adequate licenses or other rights to use, all patents, trademarks, trade names, trade secrets, and copyrights used in its business. No one has asserted to the Company that its operations infringe on the patents, trademarks, trade secrets or other rights utilized in the operation of its business. Neither the Company nor any agent or employee acting in its behalf has offered the Notes or the Stock or any portion thereof for sale to or solicited in any offer to buy the same or any thereof from any person or persons other than the purchasers listed in the attached Exhibit A and [NUMBER] other persons, and neither the Company nor any agent or employee acting in its behalf will sell or offer for sale the Notes or Stock or any portion thereof to or solicit any offer to buy the Notes or the Stock from any person or persons so as to bring the issuance or sale thereof within the provisions of Section [NUMBER] of the [ACT]. Representations and Warranties by the Note Holders The Note Holders represent and warrant that: The Note Holders are subscribing for the Notes and Stock for investment purposes and not with the view to or for sale in connection with any distribution thereof and that they have no present intent to sell, give or otherwise transfer the Notes or Stock. The Note Holders state that they are and residents of the State of [state/province]. The Note Holders understand that this is a highly speculative investment in a Company which is insolvent both from a legal and an equity standpoint. Individuals represent and warrant that they have a net worth in excess of [amount] exclusive of their residences and that they are sophisticated investors who are knowledgeable about the [specify] business. Note Holders state that they will be active in the affairs of the business of the Company. Prepayment of the Notes Company shall have the right to make prepayments on principal of the Notes at any time on [number] days written notice. Such prepayment shall be accompanied by a payment of all accrued interest to date. There shall be no premium for the amount so prepaid. Conversion","Convertible Note Agreement","6",64,"https://templates.business-in-a-box.com/imgs/1000px/convertible-note-agreement-D870.png","https://templates.business-in-a-box.com/imgs/250px/870.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#870.xml",{"title":6,"description":6},[97,99],{"label":33,"url":98},"business-legal-agreements",{"label":33,"url":98},"convertible note agreement","/template/convertible-note-agreement-D870",{"description":103,"descriptionCustom":6,"label":48,"pages":104,"size":9,"extension":10,"preview":105,"thumb":50,"svgFrame":106,"seoMetadata":107,"parents":109,"keywords":114,"url":115},"RESTRICTED STOCK PURCHASE AGREEMENT This Restricted Stock Purchase Agreement (the \"Agreement\") is effective [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"Company\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE] with its head office located at: [YOUR COMPLETE ADDRESS] AND: [SECOND PARTY NAME] (the \"Founder\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS, pursuant to the Subscription Agreement, the Founder subscribed for [NUMBER] Shares; and WHEREAS, as a condition to the subscription provided by the Subscription Agreement, the Founder agrees to restrict the Shares as more fully described herein. NOW THEREFORE, in consideration of the premises and of the mutual agreements contained in this Agreement, the parties hereto agree as follows: DEFINITIONS \"Business Relationship\" means service to the Company or its successor in the capacity of an employee, officer or director, or if so determined by the Board of Directors of the Company, as a consultant. \"Board of Directors\" shall mean the Board of Directors of the Company. \"Common Stock\" means the common stock, par value $.00001 per Share, of the Company, subject to adjustments pursuant to Section 6. \"Founders Agreement\" means that certain Founders Agreement dated the date hereof among the Company, the Founder and the other founders of the Company. \"Right of First Refusal\" means that certain right of refusal described in the Founders Agreement. VESTING Vesting Schedule: If the Founder has continuously maintained a Business Relationship with the Company through the vesting dates specified on the cover page hereof, as determined by the Board of Directors, Unvested Shares shall become Vested Shares (or shall \"vest\") on such dates and in an amount equal to that which is set forth on the cover page. Shares that have been so earned by continuity of the Founder's Business Relationship with the Company during the applicable period shall be regarded as \"Vested Shares,\" and Shares that have not been so earned by continuity of the Founder's Business Relationship with the Company during the applicable period shall be regarded as \"Unvested Shares.\" If the Founder's Business Relationship with the Company ceases, voluntarily or involuntarily, with or without cause, no Unvested Shares shall become Vested Shares thereafter with respect to the Founder. Any determination under this Agreement as to the status of a Business Relationship or other matters referred to above shall be made in good faith by the Board of Directors. The Board of Directors, in its discretion, may accelerate any vesting dates or waive any of the requirements for vesting. Termination of Business Relationship: For purposes hereof, the Founder's Business Relationship with the Company shall not be considered as having terminated during any leave of absence if such leave of absence has been approved in writing by the Board of Directors and if such written approval contractually obligates the Company to continue the Founder's Business Relationship with the Company after the approved period of absence; in the event of such an approved leave of absence, vesting of Unvested Shares shall be suspended (and the period of the leave of absence shall be added to all vesting dates), unless otherwise provided in the Board of Directors' written approval of the leave of absence or other waiver. For purposes hereof, a termination of the Founder's Business Relationship followed by another Business Relationship shall be deemed a termination of the Business Relationship, with all vesting to cease unless the Company, with the approval of the Board of Directors, enters into a written agreement related to such other Business Relationship in which it is specifically stated that there is no termination of the Business Relationship under this Agreement. This Agreement shall not be affected by any change of Business Relationship within or among the Company and its subsidiaries so long as the Founder continuously remains an employee, consultant, officer or director of the Company or any subsidiary of the Company. RIGHT OF REPURCHASE OF UNVESTED SHARES Transfers: The Founder may not sell, assign, transfer, pledge, hypothecate, gift, mortgage or otherwise encumber or dispose of (\"Transfer\") all or any of the Unvested Shares, or any interest therein, except to the Company (or any successor to the Company) pursuant to this section. Purchase by the Company: Upon the termination of the Founder's Business Relationship, the Founder and any Permitted Transferee shall sell to the Company (or the Company's assignee) all Unvested Shares in accordance with the procedures set forth below, unless the Board determines within 120 days of such termination not to purchase the Unvested Shares. The purchase price (the \"Original Repurchase Price\") of such Unvested Shares (the \"Repurchased Unvested Shares\") shall be the Purchase Price per Share (subject to adjustment as herein provided). Such sale shall be effected by the delivery by the Escrow Holder (as defined below in 8.1) to the Company of a certificate or certificates evidencing the Repurchased Unvested Shares, each duly endorsed for Transfer to the Company. Within 120 days following receipt thereof, the Company shall mail a check for the Original Repurchase Price to the Founder or shall cancel indebtedness owed to the Company by the Founder by written notice mailed to the Founder, or both. Upon the mailing of a check in payment of the purchase price in accordance with the terms hereof or cancellation of indebtedness as aforesaid, the Company shall become the legal and beneficial owner of the Unvested Shares being repurchased and all rights and interests therein or relating thereto, and the Company shall have the right to retain and Transfer to its own name or cancel the number of Unvested Shares being repurchased by the Company. RESTRICTIONS ON TRANSFERS Rights of First Refusal: Vested Shares may not be Transferred except in accordance with the Founders Agreement. Other Restrictions: Except for Exempt Transfers, the Founder may not at any time Transfer any Vested Shares to any individual, corporation, partnership or other entity that engages in any business activity that is in competition, directly or indirectly, with the products or services being developed, manufactured or sold by the Company. The determination of whether any proposed Transferee engages in any business activity that is in competition with those of the Company shall be made by the Board of Directors in good faith. This prohibition shall be applicable in addition to and separately from the other provisions hereof. INVESTMENT REPRESENTATION The Founder represents, warrants and acknowledges that the Founder: (i) has had an opportunity to ask questions of and receive answers from a Company representative concerning the terms and conditions of this investment; (ii) is acquiring the Shares with the Founder's own funds, for the Founder's own account for the purpose of investment, and not with a view to any resale or other distribution thereof in violation of the Securities Act, as amended (the \"Securities Act\"); (iii) is a sophisticated investor with such knowledge and experience in financial and business matters as to be able to evaluate the merits and risks of an investment in the Shares and that the Founder is able to and must bear the economic risk of the investment in the Shares for an indefinite period of time because the Shares have not been registered under the Securities Act, and therefore, cannot be offered or sold unless they are subsequently registered under the Securities Act or an exemption from such registration is available","7","https://templates.business-in-a-box.com/imgs/1000px/restricted-stock-purchase-agreement-D12855.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12855.xml",{"title":108,"description":6},"restricted stock purchase agreement",[110,112],{"label":18,"url":111},"finance-accounting",{"label":21,"url":113},"shareholders-investors","stock repurchase agreement","/template/stock-repurchase-agreement-D12855",{"description":117,"descriptionCustom":6,"label":118,"pages":119,"size":9,"extension":10,"preview":120,"thumb":121,"svgFrame":122,"seoMetadata":123,"parents":125,"keywords":124,"url":132},"STOCK TRANSFER AGREEMENT This Stock Transfer Agreement (the \"Agreement\") is effective [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"Transferor\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [COMPANY NAME] (the \"Transferee\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS: 1. The undersigned is the registered and beneficial owner of [NUMBER] Class [SPECIFY] Shares in the capital stock of [COMPANY NAME] Corporation (\"[COMPANY NAME]\"); 2. The undersigned wishes to sell and transfer the said Shares to [COMPANY NAME] (the \"Transferee\"); NOW THEREFORE, FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto the Transferee [NUMBER] Class [SPECIFY] Shares of [COMPANY NAME] registered in the name of the undersigned on the books of [COMPANY NAME]. IT IS HEREBY AGREED THAT: TRANSFER OF SHARES Sale and Transfer: The Transferor agrees to sell, assign, and transfer to the Transferee, and the Transferee agrees to purchase from the Transferor, the Shares for the total purchase price of [PURCHASE PRICE] (the \"Purchase Price\"). Delivery of Shares: Upon execution of this Agreement and receipt of the Purchase Price, the Transferor shall deliver to the Transferee the share certificate(s) representing the Shares, duly endorsed for transfer or accompanied by duly executed stock powers, and any other documents necessary to transfer ownership of the Shares to the Transferee. PURCHASE PRICE 2.1 Payment: The Transferee shall pay the Purchase Price to the Transferor in [SPECIFY FORM OF PAYMENT, e.g., cash, check, bank transfer], on or before [CLOSING DATE]. 2.2 Adjustment: There shall be no adjustment to the Purchase Price for any dividends declared or paid on the Shares after the date of this Agreement and before the Closing Date. REPRESENTATIONS AND WARRANTIES 3.1 Transferor's Representations: The Transferor represents and warrants that: a) The Transferor is the sole legal and beneficial owner of the Shares. b) The Shares are free and clear of all liens, claims, and encumbrances. c) The Transferor has full power and authority to enter into this Agreement and to transfer the Shares to the Transferee. 3.2 Transferee's Representations: The Transferee represents and warrants that: a) The Transferee has full power and authority to enter into this Agreement and to purchase the Shares. b) The Transferee is acquiring the Shares for investment purposes and not with a view to or for sale in connection with any distribution thereof. CONDITIONS PRECEDENT 4.1 The obligations of the Transferor and the Transferee under this Agreement are subject to the following conditions: a) Compliance with all applicable laws and regulations relating to the transfer of the Shares. b) Approval by the Company's Board of Directors or any other necessary corporate body, if required.","Stock Transfer Agreement","4","https://templates.business-in-a-box.com/imgs/1000px/stock-transfer-agreement-D14069.png","https://templates.business-in-a-box.com/imgs/250px/14069.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#14069.xml",{"title":124,"description":6},"stock transfer agreement",[126,129],{"label":127,"url":128},"Business Plan Kit","business-plan-kit",{"label":130,"url":131},"Administration","business-administration","/template/stock-transfer-agreement-D14069",{"description":134,"descriptionCustom":6,"label":135,"pages":136,"size":9,"extension":10,"preview":137,"thumb":138,"svgFrame":139,"seoMetadata":140,"parents":142,"keywords":141,"url":147},"SHAREHOLDERS AGREEMENT This Shareholders Agreement (the \"Agreement\") is made and effective [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"Company\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [FIRST SHAREHOLDER NAME] (the \"First Shareholder\"), an individual with his main address located at OR a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [SECOND SHAREHOLDER NAME] (the \"Second Shareholder\"), an individual with his main address located at OR a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [THIRD SHAREHOLDER NAME] (the \"Third Shareholder\"), an individual with his main address located at OR a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WITNESSETH: WHEREAS, the present distribution of shares of the Company is as follows: Name Number of Shares WHEREAS, in order to insure the harmonious and successful management and control of the Company, and to provide for an orderly and fair disposition of shares of common stock of the Company now or hereafter owned by any Shareholder; NOW, THEREFORE, in consideration of the mutual promises of the parties hereto, and intending to be legally bound, the parties hereby agree as follows: Definitions and organisation of the company \"Offering Shareholder\" means any Shareholder, or his personal representatives, heirs, administrators, and executors, as the case may be, who pursuant to this Agreement must or does offer all or any of his Shares to the Company or the Continuing Shareholders. \"Continuing Shareholders\" means all Shareholders other than an Offering Shareholder. \"Shares\" means shares of Common Stock of the Company now or hereafter owned by any Shareholder. \"Buyer\" means the Company or those Continuing Shareholders who purchase an Offering Shareholder's Shares pursuant to this Agreement. \"Management Shareholder\" means First Shareholder, Second Shareholder and Third Shareholder. ORGANISATION OF THE COMPANY The affairs of the Company will be managed by a board of [NUMBER] directors unless changed by a unanimous Directors' Resolution. The present directors of the Company are [DIRECTORS' NAMES]. It is agreed that [SHAREHOLDERS' NAMES] shall each be entitled to elect one director to the board of directors of the Company so long as each is a Shareholder. Two (2) directors shall constitute a quorum for the transaction of any business at any meeting of the board of directors. At all meetings of the board of directors, every motion to be carried must receive a majority of the votes cast, subject to the provisions of subparagraphs 2.4 and 2.5. Unless otherwise agreed, board meetings will be held at the head office of the Company. In the event that a nominee to the Board of one of the Shareholders shall fail to vote and act as a director to carry out the provisions of this agreement, then the shareholders agree to exercise their right as shareholders of the Company and in accordance with the Articles of the Company to remove such nominee from the Board and to elect in the place or stead thereof such individual who will use his/her best efforts to carry out the provisions of this agreement but only in the event that the Shareholder whose nominee has been removed fails to appoint a successor within a period of fourteen days from the date such nominee has been removed. The election, appointment and determination of officers and the auditors and advisors of the Company, the defining of their duties and functions and the salaries and remuneration to be paid to them will be a function of the board of directors. Until changed by the board of directors, the Officers of the Company and their annual salaries shall be: Office Held: Director: [NAME] [SALARY] Secretary: [NAME] [SALARY] All direct out-of-pocket expenses will be reimbursed provided these falls within guidelines set out by the Board of Directors from time to time. Until otherwise agreed, each officer of the Company will commit to spending his/her full time on the affairs of the Company. Until changed by the board of directors, the auditors and advisors of the Company shall be: Auditor: Legal Advisors: There shall be kept, in such bank or banks (including trust companies) as may be determined by the board of directors, bank accounts of the Company in which shall be deposited all monies received by the Company in the course of carrying on business from time to time. All payments on account of the Company shall be made by cheques drawn on the bank account and all cheques, drafts or other instruments drawn and made for the purposes of the business of the Company shall be executed by such directors, officers or employees as may from time to time be authorized so to do by the board of directors. Subject to paragraph 2.6, all decisions relating to the management and control of the business of the Company shall be determined by the board of directors of the Company, provided always that the following matters shall be determined by a Special Directors' Resolution: any capital expenditures greater than xxxx; any lease commitments greater than xxxx; the acquisition of any business interests by the Company; the elections of officers of the Company; the payment of any cash dividends or stock dividends to Shareholders of the Company; the issuance of any debt obligations of the Company; the disposal of the whole or any part of the business, undertaking, or assets of the Company outside the normal course of business of the Company the transfer of any shares of the Company; changes or variations in the objects or powers of the Company; the liquidation or winding up of the Company; the approval of any contracts or transactions outside the normal course of business; the execution of any contract involving a consideration greater than xxxx within the normal course of business; the lending of money by the Company; the guarantee by the Company of the debts or obligations of any other person, firm or body corporate; any non-budgeted expenditures greater than xxxx; business plan and/or budgets. The following decisions shall be determined by a Unanimous Directors' Resolution: alterations, variations or changes to the authorized or issued capital of the Company; the salaries and bonuses of officers and directors of the Company; the issue, redemption or purchase of any Shares; and changes in the number of directors of the Company The Shareholders may pledge any of their Shares as security for any borrowings by them provided the pledgee executes an agreement, in writing, providing that the pledgee shall be subject to all of the terms of this Agreement. The board of directors shall meet at least four times during each fiscal year of the Company. Any director can call a meeting provided 10 days notice is given. Notice may be waived. During the first year from the date of this agreement, the board of directors shall meet on a monthly basis. Directors may elect to attend a board meeting by telephone conference call. Each Shareholder shall, for so long as s/he is the owner of shares of the Company devote such of his/her business, time and energy as may be reasonably required to carry on the business of the Company and the Shareholder shall use his/her best efforts, skill and abilities to promote the interests of the Company. Each Shareholder agrees that he/she will not engage, without the consent of the other Shareholders, in a business which is directly competitive to that of the Company. Purchase for Investment","Shareholders Agreement","16","https://templates.business-in-a-box.com/imgs/1000px/shareholders-agreement-D1016.png","https://templates.business-in-a-box.com/imgs/250px/1016.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#1016.xml",{"title":141,"description":6},"shareholders agreement",[143,144],{"label":33,"url":98},{"label":145,"url":146},"Incorporation Agreements","incorporation-agreement","/template/shareholders-agreement-D1016",{"description":149,"descriptionCustom":6,"label":150,"pages":151,"size":9,"extension":10,"preview":152,"thumb":153,"svgFrame":154,"seoMetadata":155,"parents":157,"keywords":156,"url":162},"NON-DISCLOSURE AGREEMENT (NDA) This Non-Disclosure Agreement (the \"Agreement\") is made and effective [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"Disclosing Party\"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [RECEIVING PARTY NAME] (the \"Receiving Party\"), an individual with his main address located at OR a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS, Receiving Party has been or will be engaged in the performance of work on [DESCRIBE]; and in connection therewith will be given access to certain confidential and proprietary information; and WHEREAS, Receiving Party and Disclosing Party wish to evidence by this Agreement the manner in which said confidential and proprietary material will be treated. NOW, THEREFORE, it is agreed as follows: NON-DISCLOSURE OF CONFIDENTIAL INFORMATION Both Parties understand and agree that each Party may have access to the confidential information of the other party. For the purposes of this Agreement, \"Confidential Information\" means proprietary and confidential information about the Disclosing Party's (or it's suppliers') business or activities. Such information includes all business, financial, technical, and other information marked or designated by such Party as \"confidential\" or \"proprietary.\" Confidential Information also includes information which, by the nature of the circumstances surrounding the disclosure, ought in good faith to be treated as confidential. For the purposes of this Agreement, Confidential Information does not include: Information that is currently in the public domain or that enters the public domain after the signing of this Agreement. Information a Party lawfully receives from a third Party without restriction on disclosure and without breach of a non-disclosure obligation. Information that the Receiving Party knew prior to receiving any Confidential Information from the Disclosing Party. Information that the Receiving Party independently develops without reliance on any Confidential Information from the Disclosing Party. Each Party agrees that it will not disclose to any third Party or use any Confidential Information disclosed to it by the other Party except when expressly permitted in writing by the other Party. Each Party also agrees that it will take all reasonable measures to maintain the confidentiality of all Confidential Information of the other Party in its possession or control. TERM The term of this Agreement is [number] of [years/months] from the date of execution by both Parties. TITLE The Receiving Party agrees that all Confidential Information furnished by the Disclosing Party shall remain the sole property of the Disclosing Party. DISCLAIMER","Non Disclosure Agreement Nda","3","https://templates.business-in-a-box.com/imgs/1000px/non-disclosure-agreement-nda-D12692.png","https://templates.business-in-a-box.com/imgs/250px/12692.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12692.xml",{"title":156,"description":6},"non disclosure agreement nda",[158,159],{"label":33,"url":98},{"label":160,"url":161},"Confidentiality Agreements","confidentiality-agreement","/template/non-disclosure-agreement-nda-D12692",{"description":164,"descriptionCustom":6,"label":165,"pages":151,"size":166,"extension":10,"preview":167,"thumb":168,"svgFrame":169,"seoMetadata":170,"parents":171,"keywords":176,"url":177},"TERM SHEET Issue: [Venture Capital FIRM] (\"VC\") and/or any member of its corporate group (\"the VC Group\") will purchase up to [AMOUNT] Series A Convertible Preferred Stock (\"Series A\") newly issued by [YOUR COMPANY NAME] (the \"Company\") at a price per share of [PRICE] (the \"Purchase Price\"). In addition, other investors shall purchase at least [AMOUNT] but not more than [AMOUNT] of newly issued Series A at the Purchase Price. The shares of Series A will be convertible at any time at the option of the holder into common shares of the Company (\"Common Stock\") on a one-for-one basis, adjusted for future share splits. The Purchase Price equates to a pre-money valuation of [VALUATION]. The calculation is based on [NUMBER] fully diluted shares of Common Stock. If the number of shares issued, or stock awards/options authorized increases before the closing the price per share for Series A Convertible Preferred Stock shall be reduced so that the pre-money valuation is unchanged. The Series A Convertible Preferred Stock shall be referred to herein as the \"Preferred Stock.\" Dividend: The Preferred Stock is entitled to an annual [AMOUNT] per share dividend, payable when and if declared by the Board of Directors, but prior to any payment on Common Stock; dividends are not cumulative. Liquidation Preference: The Series A will have a liquidation preference so that proceeds on a merger, sale or liquidation (including non-cumulative dividends) will first be paid to the Series A and will include a [%] per annum compounding guaranteed return calculated on the total amount invested. Upon completion of an additional round of funding of at least [AMOUNT] the compounding guaranteed return feature will expire. The liquidation preference will cease to operate if the proceeds due to Series A, on a merger, sale or liquidation on an as-converted basis, exceed the proceeds that would be due under the liquidation preference. Use of Proceeds: The funds raised by Series A will be used principally for general working capital purposes. Voting Rights: The holders of the Series A shall have the right to vote with the Common Stock on an as-if-converted basis. Redemption: If not previously converted, the Series A is to be redeemed in three equal successive annual installments beginning [DATE]. Redemption will be at the purchase price plus a [%] per annum cumulative guaranteed return. Pre-emptive Rights: Holders of the Preferred Stock will be granted rights to participate in future equity financings of the Company based upon their pro-rata, as-if-converted, ownership of the Company. Automatic Conversion: The Preferred Stock shall be automatically converted into Common Stock at the then applicable conversion rate (1:1 assuming no share splits) in the event of an underwritten public offering of shares of the Company at a total offering of not less than [AMOUNT] and at a per share public offering price of not less than three times the Series A purchase price per share, adjusted for splits. Anti-Dilution: Series A shall have weighted average anti-dilution, based on a weighted average formula to be agreed, for all securities purchased as part of this transaction (excluding shares, options and warrants issued for management incentive and small issues for strategic purposes of under [NUMBER] shares). Management Options: Simultaneously with this transaction, one million new shares shall expand the Company's management incentive stock option pool - bringing the total number of shares issued and stock incentives (awards and options) authorized to [NUMBER OF SHARES]. Rights of First Offer; Tag-Along: The Company and the Investors will have a right of first refusal with respect to any employee's shares proposed to be resold. Alternatively, the Investors will have the right to participate in the sale of any such shares to a third party (co-sale rights), which rights will terminate upon a public offering. Information Rights: Monthly actual vs. plan and prior year. Annual budget [NUMBER] days before beginning of fiscal year","Term Sheet",42,"https://templates.business-in-a-box.com/imgs/1000px/term-sheet-D473.png","https://templates.business-in-a-box.com/imgs/250px/473.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#473.xml",{"title":6,"description":6},[172,173],{"label":18,"url":111},{"label":174,"url":175},"Raising Capital","raising-capital","term sheet","/template/term-sheet-D473",false,{"seo":180,"reviewer":192,"quick_facts":196,"at_a_glance":199,"personas":203,"variants":228,"glossary":255,"clauses":289,"how_to_fill":339,"common_mistakes":380,"faqs":405,"industries":433,"comparisons":450,"diy_vs_lawyer":463,"jurisdictions":476,"related_template_ids_curated":497,"schema":506,"classification":507},{"meta_title":181,"meta_description":182,"primary_keyword":183,"secondary_keywords":184},"Preferred Stock Purchase Agreement Template (Free Word)","Free preferred stock purchase agreement template for equity financing rounds. Covers share class, price, rights, representations, and closing conditions. Free Word and PDF download.","preferred stock purchase agreement template",[15,185,186,187,188,189,190,191],"stock purchase agreement template word","equity financing agreement template","series a stock purchase agreement","preferred share purchase agreement","venture capital stock purchase agreement","preferred stock agreement free download","series seed stock purchase agreement",{"name":193,"credential":194,"reviewed_date":195},"Bruno Goulet","CEO, Business in a Box","2026-05-02",{"difficulty":197,"legal_review_recommended":198,"signature_required":198},"advanced",true,{"what_it_is":200,"when_you_need_it":201,"whats_inside":202},"A Preferred Stock Purchase Agreement (PSPA) is a binding contract between a company and one or more investors governing the sale of preferred shares in an equity financing round. This free Word download captures the essential terms of the transaction — share class, purchase price, investor rights, representations and warranties, and closing mechanics — in a single investor-ready document you can edit online and export as PDF.\n","Use it when raising a priced equity round from angel investors, venture capital funds, or strategic investors in exchange for preferred shares with special rights not attached to common stock. It is the primary transaction document for Series Seed, Series A, and later priced rounds.\n","Share class definition and purchase price per share, total investment amount and investor schedule, representations and warranties from both company and investors, conditions to closing, post-closing covenants, indemnification provisions, and governing law. Related schedules covering the capitalization table, disclosed exceptions, and investor accreditation are typically attached as exhibits.\n",[204,208,212,216,220,224],{"title":205,"use_case":206,"icon_asset_id":207},"Startup founders","Documenting the terms of a seed or Series A equity round with VCs or angels","persona-startup-founder",{"title":209,"use_case":210,"icon_asset_id":211},"Corporate attorneys","Drafting or reviewing transaction documents on behalf of the issuing company","persona-corporate-attorney",{"title":213,"use_case":214,"icon_asset_id":215},"Venture capital funds","Formalizing investment terms after a term sheet is agreed and due diligence is complete","persona-venture-capitalist",{"title":217,"use_case":218,"icon_asset_id":219},"Angel investors","Securing preferred share rights and anti-dilution protections in an early-stage company","persona-angel-investor",{"title":221,"use_case":222,"icon_asset_id":223},"CFOs and finance directors","Managing the closing process, cap table updates, and post-closing compliance obligations","persona-cfo",{"title":225,"use_case":226,"icon_asset_id":227},"Growth-stage CEOs","Raising a follow-on round from existing and new institutional investors","persona-ceo",[229,233,236,240,244,248,251],{"situation":230,"recommended_template":231,"slug":232},"Raising the first institutional priced round (Series Seed or Series A)","Preferred Stock Purchase Agreement (Series A)","preferred-stock-purchase-agreement-D12854",{"situation":234,"recommended_template":89,"slug":235},"Issuing convertible preferred shares with no fixed liquidation preference","convertible-note-agreement-D870",{"situation":237,"recommended_template":238,"slug":239},"Selling common shares to co-founders or early team members","Common Stock Purchase Agreement","stock-purchase-agreement-D349",{"situation":241,"recommended_template":242,"slug":243},"Selling shares back from a departing founder or employee","Stock Repurchase Agreement","stock-repurchase-agreement-D12855",{"situation":245,"recommended_template":246,"slug":247},"Bridging to the next priced round with a simple instrument","SAFE Agreement (Simple Agreement for Future Equity)","simple-agreement-for-future-equity-safe-D13395",{"situation":249,"recommended_template":118,"slug":250},"Transferring existing shares between parties rather than issuing new shares","stock-transfer-agreement-D14069",{"situation":252,"recommended_template":253,"slug":254},"Granting options to employees rather than issuing shares directly","Stock Option Agreement","employee-stock-option-agreement-D12613",[256,259,262,265,268,271,274,277,280,283,286],{"term":257,"definition":258},"Preferred Stock","A class of equity with rights superior to common stock, typically including a liquidation preference, dividend priority, and anti-dilution protection.",{"term":260,"definition":261},"Liquidation Preference","The right of preferred stockholders to receive their investment back — sometimes at a multiple — before common stockholders receive anything in a sale or wind-down.",{"term":263,"definition":264},"Anti-Dilution Protection","A provision adjusting the conversion ratio of preferred shares downward if the company later issues shares at a lower price, protecting early investors from dilution.",{"term":266,"definition":267},"Representations and Warranties","Factual statements made by each party as of the closing date — if they turn out to be false, the deceived party may have grounds for indemnification or rescission.",{"term":269,"definition":270},"Cap Table (Capitalization Table)","A spreadsheet listing all equity owners, their share classes, ownership percentages, and the post-closing dilution resulting from the current financing.",{"term":272,"definition":273},"Closing Conditions","Specific requirements — board approval, regulatory filings, or investor accreditation confirmation — that must be satisfied before shares are issued and funds are transferred.",{"term":275,"definition":276},"Accredited Investor","An individual or entity meeting SEC-defined wealth or income thresholds (net worth over $1M excluding primary residence, or annual income over $200K) that is legally permitted to purchase unregistered securities.",{"term":278,"definition":279},"Pre-Money Valuation","The agreed value of the company immediately before new investor capital is added, used to calculate the price per share in the round.",{"term":281,"definition":282},"Pro Rata Rights","The contractual right of an existing investor to participate in future funding rounds at their pro rata ownership percentage to avoid dilution.",{"term":284,"definition":285},"Drag-Along Rights","A provision allowing a majority of stockholders to compel minority holders to approve and participate in a sale of the company on the same terms.",{"term":287,"definition":288},"Indemnification","The obligation of one party to compensate the other for losses arising from a breach of representations, warranties, or covenants in the agreement.",[290,295,300,305,310,315,320,325,329,334],{"name":291,"plain_english":292,"sample_language":293,"common_mistake":294},"Purchase and sale of preferred shares","Establishes the core transaction — the company agrees to sell, and each investor agrees to buy, a specified number of preferred shares at a defined price per share.","Subject to the terms of this Agreement, the Company shall issue and sell to each Investor, and each Investor shall purchase from the Company, the number of shares of [SERIES] Preferred Stock set forth opposite such Investor's name on Exhibit A at a purchase price of $[PRICE PER SHARE] per share.","Failing to attach or finalize the investor schedule (Exhibit A) before signing. An unsigned or incomplete schedule creates ambiguity about each investor's commitment and share count.",{"name":296,"plain_english":297,"sample_language":298,"common_mistake":299},"Representations and warranties of the company","The company confirms a defined set of facts as true at closing — including its legal existence, authority to issue shares, capitalization, absence of undisclosed liabilities, and compliance with applicable law.","The Company represents and warrants to each Investor that: (a) the Company is duly organized and validly existing under the laws of [STATE]; (b) the Shares, when issued, will be duly authorized, fully paid, and non-assessable; and (c) no material litigation is pending or, to the Company's knowledge, threatened against the Company.","Using generic boilerplate representations that do not reflect actual company circumstances. If a listed representation is false at closing, it creates immediate indemnification exposure — undisclosed exceptions must be scheduled.",{"name":301,"plain_english":302,"sample_language":303,"common_mistake":304},"Representations and warranties of the investors","Each investor confirms they are legally authorized to invest, are purchasing for their own account, are aware of the risks, and meet accredited investor requirements.","Each Investor represents and warrants that: (a) it has full power and authority to execute this Agreement; (b) it is acquiring the Shares for its own account, not with a view to distribution; and (c) it is an 'accredited investor' as defined in Rule 501 of Regulation D.","Omitting the accredited investor representation for US-based raises. Selling unregistered securities to non-accredited investors triggers securities law violations regardless of whether a formal disclosure was made.",{"name":306,"plain_english":307,"sample_language":308,"common_mistake":309},"Conditions to closing","Lists everything that must happen before the company can issue shares and investors must wire funds — such as board approval, restated articles, and execution of related agreements.","The obligations of each Investor to purchase Shares at the Closing are conditioned upon: (a) execution of this Agreement by the Company and all Investors; (b) filing of the Amended and Restated Certificate of Incorporation with the [STATE] Secretary of State; and (c) execution of the Investor Rights Agreement and Voting Agreement.","Setting conditions that are already completed or impossible to satisfy, or omitting conditions that are actually needed. Either creates a closing risk or an unnecessary escape hatch for a party who changes their mind.",{"name":311,"plain_english":312,"sample_language":313,"common_mistake":314},"Closing mechanics and wire instructions","Specifies the closing date, location (or remote closing process), how funds are transferred, and when share certificates or electronic ledger entries are delivered.","The closing shall take place remotely via exchange of documents and wire transfer on [DATE] ('Closing Date'), or at such other time as the Company and Investors shall agree. Each Investor shall deliver its purchase price by wire transfer to the account designated by the Company no later than [TIME] on the Closing Date.","Omitting wire instructions or leaving the closing date blank. An indefinite closing date allows either party to delay indefinitely, giving leverage to the side that changes its mind.",{"name":316,"plain_english":317,"sample_language":318,"common_mistake":319},"Use of proceeds","Describes, at least at a high level, how the company intends to deploy the investment capital — product development, sales, operations, or general working capital.","The Company shall use the proceeds from the sale of Shares primarily for [PRODUCT DEVELOPMENT / SALES AND MARKETING / WORKING CAPITAL / GENERAL CORPORATE PURPOSES] as described in the budget attached as Exhibit [X].","Leaving the use-of-proceeds section entirely blank or excessively vague. While not always legally binding, investors expect a stated purpose and courts may consider it evidence of fraudulent misrepresentation if funds are used contrary to representations.",{"name":321,"plain_english":322,"sample_language":323,"common_mistake":324},"Post-closing covenants","Ongoing obligations the company undertakes after closing — such as delivering financial statements, maintaining insurance, and complying with investor information rights.","Following the Closing, the Company shall: (a) deliver unaudited quarterly financial statements to each Major Investor within 45 days of quarter end; (b) maintain directors' and officers' liability insurance of at least $[AMOUNT]; and (c) promptly notify each Major Investor of any material adverse change in the Company's business.","Agreeing to audit-level financial reporting requirements the company cannot practically deliver. Startups that promise audited annual financials and then fail to deliver them are technically in breach from year one.",{"name":287,"plain_english":326,"sample_language":327,"common_mistake":328},"Requires each party to compensate the other for losses caused by a breach of their representations, warranties, or covenants, subject to defined caps and survival periods.","The Company shall indemnify and hold harmless each Investor from and against any losses arising out of any material breach of the Company's representations or warranties, provided that the Company's total indemnification liability shall not exceed $[CAP AMOUNT] and claims must be brought within [X] years of the Closing Date.","No indemnification cap or survival period. Without a cap, a single misrepresentation claim could theoretically exceed the round size; without a survival period, claims remain open indefinitely.",{"name":330,"plain_english":331,"sample_language":332,"common_mistake":333},"Transfer restrictions and right of first refusal","Restricts investors from freely transferring preferred shares to third parties and gives the company or other investors the right to purchase shares before they can be sold externally.","No Investor shall transfer any Shares without first offering the Company the right to repurchase such Shares at the proposed transfer price. The Company shall have [30] days to exercise its right of first refusal. Permitted transfers to affiliates are excepted from this restriction.","Omitting permitted transfer carve-outs for affiliated funds or co-investors. Institutional investors routinely need to transfer shares between fund vehicles — blocking all transfers without exceptions makes the agreement unworkable for professional investors.",{"name":335,"plain_english":336,"sample_language":337,"common_mistake":338},"Governing law and dispute resolution","Specifies which jurisdiction's law governs the agreement and how disputes are resolved — litigation in a named court or binding arbitration.","This Agreement shall be governed by the laws of the State of [DELAWARE / CALIFORNIA / OTHER], without regard to conflict-of-law principles. Any dispute arising under this Agreement shall be resolved by binding arbitration before [AAA / JAMS] in [CITY, STATE], except that either party may seek injunctive relief in any court of competent jurisdiction.","Choosing a governing law different from the company's state of incorporation without legal advice. Delaware is standard for US corporations — using a different state may produce unexpected results on shareholder rights, fiduciary duties, and appraisal rights.",[340,345,350,355,360,365,370,375],{"step":341,"title":342,"description":343,"tip":344},1,"Identify the company and each investor","Enter the company's full legal name, state of incorporation, and principal office address. List every investor by legal name or entity name as it appears on their formation documents, along with each investor's address and intended share count.","For fund investors, confirm whether the investing entity is the fund itself, a special purpose vehicle, or a carry vehicle — the wrong entity name can complicate tax and transfer compliance later.",{"step":346,"title":347,"description":348,"tip":349},2,"Define the share class and price per share","Name the series (e.g., Series Seed Preferred Stock or Series A Preferred Stock), specify the price per share derived from the agreed pre-money valuation divided by the fully diluted share count, and state the total round size.","Calculate price per share using the fully diluted cap table — including any option pool expansion agreed in the term sheet — before entering the number here.",{"step":351,"title":352,"description":353,"tip":354},3,"Complete the investor schedule (Exhibit A)","List each investor, their investment amount in dollars, the resulting share count at the stated price per share, and their pro rata percentage of the round. Confirm the total column matches the stated round size.","Build the exhibit in a spreadsheet and cross-check it against your cap table software before pasting into the agreement — arithmetic errors in Exhibit A have caused closing delays on real rounds.",{"step":356,"title":357,"description":358,"tip":359},4,"Review and schedule the company's representations","Read each company representation carefully and attach a disclosure schedule (Exhibit B or Schedule of Exceptions) listing any exceptions. If the company is a party to undisclosed litigation, has IP ownership questions, or has previously issued shares outside a formal process, disclose it here.","Investors will conduct due diligence and discover undisclosed issues anyway — proactive disclosure in the schedule protects the company from fraud claims; omission does not.",{"step":361,"title":362,"description":363,"tip":364},5,"Confirm accredited investor status for each investor","Collect and retain investor questionnaires or third-party accreditation verification for each investor before closing. The investor representations clause requires each investor to confirm accredited status — this is a legal prerequisite for a Regulation D exempt offering in the US.","Third-party accreditation verification services (e.g., VerifyInvestor) provide defensible documentation for $20–$50 per investor and are worth the cost for rounds with five or more participants.",{"step":366,"title":367,"description":368,"tip":369},6,"Set the closing date and wire instructions","Enter a specific closing date, the company's bank account wiring instructions, and any conditions that must be satisfied on or before that date. Identify which conditions have already been met and note them as satisfied.","Schedule the closing for the middle of a business week — Friday closings frequently slip to the following Monday due to bank wire cut-off times.",{"step":371,"title":372,"description":373,"tip":374},7,"Attach and cross-reference all related agreements","A PSPA is almost always signed alongside an Investor Rights Agreement, Voting Agreement, and Right of First Refusal and Co-Sale Agreement. List each as a condition to closing and confirm all are executed simultaneously.","Number the exhibits consistently across all transaction documents — mismatched exhibit references are the most common source of ambiguity in post-closing disputes.",{"step":376,"title":377,"description":378,"tip":379},8,"Execute before funds are transferred","All parties must sign the agreement before any wire is sent. Collect counterpart signatures from every investor and obtain the company's board authorization. File the Amended and Restated Certificate of Incorporation with the relevant Secretary of State before or simultaneously with closing.","Use a closing checklist shared with all parties at least five business days before the closing date so no item is discovered missing on the day funds are due to transfer.",[381,385,389,393,397,401],{"mistake":382,"why_it_matters":383,"fix":384},"Incomplete or unsigned investor schedule","An unsigned or incomplete Exhibit A leaves the total round size, individual commitments, and share counts legally unspecified — any investor can argue they committed to a different amount.","Finalize Exhibit A before circulating the agreement for signature and confirm every investor's figures with their own counsel before the closing date.",{"mistake":386,"why_it_matters":387,"fix":388},"No disclosure schedule for company representations","If the company makes an unqualified representation that turns out to be false — even inadvertently — investors can assert fraud or material breach and seek indemnification for the full loss.","Attach a Schedule of Exceptions listing every known exception to each representation, no matter how minor it seems. Scheduled exceptions are disclosed; unscheduled ones create liability.",{"mistake":390,"why_it_matters":391,"fix":392},"Omitting accredited investor confirmations","Selling unregistered securities to non-accredited investors in the US violates SEC Regulation D, exposing the company to SEC enforcement, state securities law violations, and investor rescission rights.","Require each investor to complete a written accreditation questionnaire before closing and retain the documentation for at least three years.",{"mistake":394,"why_it_matters":395,"fix":396},"Signing the agreement before the amended charter is filed","Preferred shares cannot legally exist until the Amended and Restated Certificate of Incorporation creating the new share class is filed with the Secretary of State — shares issued before filing are legally invalid.","Make filing of the amended charter an explicit closing condition and confirm the Secretary of State filing number before releasing funds and issuing shares.",{"mistake":398,"why_it_matters":399,"fix":400},"Agreeing to financial reporting obligations the company cannot meet","A startup that promises audited annual financials and then fails to deliver is technically in breach of the PSPA from its first fiscal year end, giving investors grounds to accelerate other rights.","Negotiate reporting obligations tied to your actual financial infrastructure — unaudited quarterly statements are standard for early-stage companies; audited financials are typically a Series B or later requirement.",{"mistake":402,"why_it_matters":403,"fix":404},"No indemnification cap or survival period","Without a cap, a single misrepresentation claim is theoretically unlimited; without a survival period, claims remain open permanently and cloud future financing and M&A transactions.","Negotiate an indemnification cap equal to the total investment amount and a survival period of 18–36 months from closing for general representations, with a carve-out for fraud that survives indefinitely.",[406,409,412,415,418,421,424,427,430],{"question":407,"answer":408},"What is a preferred stock purchase agreement?","A preferred stock purchase agreement is a binding contract between a company and one or more investors that governs the issuance and sale of preferred shares in an equity financing round. It sets the purchase price per share, total investment amount, the rights attached to the new share class, representations and warranties from both sides, conditions to closing, and post-closing obligations. It is the primary transaction document for Series Seed, Series A, and later priced rounds.\n",{"question":410,"answer":411},"What is the difference between preferred stock and common stock?","Preferred stock carries rights that common stock does not — typically a liquidation preference (the right to get invested capital back before common holders in a sale or wind-down), dividend priority, anti-dilution protection, and sometimes board representation rights. Common stock is held by founders and employees; preferred stock is issued to institutional investors in priced rounds. In a below-valuation exit, preferred holders are made whole before common holders receive anything.\n",{"question":413,"answer":414},"What other documents are typically signed alongside a preferred stock purchase agreement?","A PSPA is almost always executed as part of a suite of transaction documents that includes an Investor Rights Agreement (covering information rights, registration rights, and pro rata), a Voting Agreement (governing board composition and drag-along provisions), and a Right of First Refusal and Co-Sale Agreement (governing share transfers). All four are typically conditions to closing in the PSPA itself, and all are signed simultaneously.\n",{"question":416,"answer":417},"Do I need a lawyer to complete a preferred stock purchase agreement?","Legal review is strongly recommended for any priced equity round. A PSPA creates enforceable rights that persist for the life of the company — anti-dilution adjustments, liquidation preferences, and indemnification obligations can have multimillion-dollar consequences in a future exit. For seed rounds under $500K with a small number of sophisticated angel investors, a template with counsel review is typically sufficient. Series A and larger rounds almost universally involve law firms on both sides.\n",{"question":419,"answer":420},"What is a liquidation preference and how does it work?","A liquidation preference gives preferred stockholders the right to receive their invested capital — and sometimes a multiple of it — before common stockholders receive any proceeds in a sale, merger, or wind-down. A 1x non-participating preference returns exactly the investment amount before common participates. A participating preferred also receives its preference and then shares pro rata in remaining proceeds alongside common — a more investor-friendly term that founders should negotiate carefully.\n",{"question":422,"answer":423},"What is anti-dilution protection in a preferred stock agreement?","Anti-dilution protection adjusts the conversion ratio of preferred shares if the company issues new shares at a lower price than the preferred investors paid. Broad-based weighted average anti-dilution is the most common and least punitive form — it adjusts the conversion price based on a formula that accounts for the size of the down round. Full ratchet anti-dilution, which adjusts the price to match the lowest subsequent issuance price, is heavily investor-favorable and rare in founder-friendly term sheets.\n",{"question":425,"answer":426},"What is Regulation D and why does it matter for a preferred stock offering?","Regulation D is a set of SEC rules that exempt private companies from the full registration requirements of the Securities Act of 1933 when they sell securities to accredited investors. Rule 506(b) allows sales to up to 35 sophisticated non-accredited investors alongside unlimited accredited investors; Rule 506(c) allows general solicitation but requires all investors to be verified accredited. Companies must file a Form D with the SEC within 15 days of the first sale and comply with applicable state blue sky laws.\n",{"question":428,"answer":429},"What happens if a representation in the agreement turns out to be false?","A false representation at closing gives the affected party the right to seek indemnification for resulting losses, and in some cases to rescind the transaction. The severity depends on whether the breach was material, whether it was scheduled as an exception, and the terms of the indemnification clause. Intentional misrepresentation can support a fraud claim with no cap on damages. This is why a thorough Schedule of Exceptions is essential — disclosed exceptions are contractually accepted; undisclosed ones create liability.\n",{"question":431,"answer":432},"What is a closing condition and what happens if one is not met?","A closing condition is a requirement that must be satisfied before the parties are obligated to complete the transaction — for example, filing the amended charter or obtaining board approval. If a condition is not met by the closing date, the party benefiting from that condition can waive it in writing or terminate the agreement without liability. Parties should distinguish between conditions that can be waived and those that are legal prerequisites — filing the amended charter to create the preferred share class cannot be waived.\n",[434,438,442,446],{"industry":435,"icon_asset_id":436,"specifics":437},"Technology / SaaS","industry-saas","IP assignment confirmations and source code ownership representations are critical given that software IP is typically the company's primary asset at the time of the round.",{"industry":439,"icon_asset_id":440,"specifics":441},"Life Sciences / Biotech","industry-healthtech","Regulatory approvals, clinical trial milestone triggers, and FDA pathway representations are standard additions; investors often require milestone-based tranche funding tied to specific development events.",{"industry":443,"icon_asset_id":444,"specifics":445},"Fintech / Financial Services","industry-fintech","Money transmitter licenses, broker-dealer registrations, and banking charter status must be accurately represented; regulatory compliance failures are the most common source of indemnification claims in fintech rounds.",{"industry":447,"icon_asset_id":448,"specifics":449},"Consumer Goods / E-commerce","industry-ecommerce","Inventory ownership, supplier contract assignment rights, and brand trademark registrations are key representations; international rounds often require additional IP licensing schedules.",[451,454,457,460],{"vs":89,"vs_template_id":452,"summary":453},"convertible-note-agreement-D13260","A convertible note is debt that converts into equity at a future priced round — it defers valuation and closes faster with less documentation than a PSPA. A preferred stock purchase agreement sets a fixed valuation and issues shares immediately, creating a formal cap table entry at closing. Convertible notes suit very early-stage companies where valuation is contested; PSPAs are standard once a company has enough traction to support a negotiated price.",{"vs":238,"vs_template_id":455,"summary":456},"","A common stock purchase agreement issues ordinary shares with no special rights — used for founder stock, early co-founder grants, and employee purchases. A PSPA issues preferred shares with liquidation preferences, anti-dilution protections, and investor rights that common stock does not carry. Institutional investors almost always require preferred shares; common stock sales to investors create tax and structural complications.",{"vs":458,"vs_template_id":455,"summary":459},"SAFE Agreement","A Simple Agreement for Future Equity (SAFE) is a non-debt, non-equity instrument that grants the right to receive shares at a future priced round. It is the fastest and simplest instrument for pre-seed fundraising and creates no immediate cap table entry. A PSPA is a priced instrument that closes a defined round, issues shares at a fixed valuation, and gives investors immediate preferred stockholder rights. SAFEs defer complexity; PSPAs resolve it.",{"vs":253,"vs_template_id":461,"summary":462},"stock-option-agreement-D424","A stock option agreement grants an employee or advisor the right to purchase common shares at a fixed exercise price after vesting — it is a compensation instrument, not an investment document. A PSPA governs the purchase of preferred shares by investors for cash consideration. Options create contingent equity obligations managed through an equity plan; a PSPA closes an actual financing transaction.",{"use_template":464,"template_plus_review":468,"custom_drafted":472},{"best_for":465,"cost":466,"time":467},"Pre-seed rounds under $250K with a small number of known angel investors who agree to simplified terms","Free","1–2 days to complete and circulate",{"best_for":469,"cost":470,"time":471},"Seed rounds of $250K–$2M with professional angel investors or a lead investor requiring standard NVCA-style documents","$1,500–$5,000 for counsel review on both sides","1–2 weeks",{"best_for":473,"cost":474,"time":475},"Series A and later rounds, institutional VC leads, complex cap tables, or international investors requiring cross-border legal coordination","$10,000–$40,000+ for full transaction legal fees on both sides","3–8 weeks",[477,482,487,492],{"code":478,"name":479,"flag_asset_id":480,"note":481},"us","United States","flag-us","Delaware is the standard state of incorporation for venture-backed companies — its General Corporation Law provides the most developed body of case law on preferred stock rights, fiduciary duties, and stockholder appraisal. Federal securities law requires a Form D filing with the SEC within 15 days of the first sale under Regulation D. State blue sky law filings are also required in each state where investors reside, though most states have Regulation D preemption for 506(b) and 506(c) offerings.",{"code":483,"name":484,"flag_asset_id":485,"note":486},"ca","Canada","flag-ca","Canadian preferred share issuances are governed by provincial corporate statutes — the Canada Business Corporations Act (CBCA) for federally incorporated companies, or provincial equivalents such as Ontario's Business Corporations Act. Preferred share rights must be set out in the articles of incorporation, and an articles amendment is required to create a new series. Securities law exemptions vary by province; most rely on the accredited investor exemption, which has a different income and net worth threshold than the US SEC definition.",{"code":488,"name":489,"flag_asset_id":490,"note":491},"uk","United Kingdom","flag-uk","UK companies issue preference shares governed by the Companies Act 2006. Share rights must be set out in the articles of association, and a special resolution is typically required to create or amend a share class. The Financial Conduct Authority regulates securities offerings; most early-stage rounds rely on the High Net Worth Individual or Sophisticated Investor exemption under the Financial Services and Markets Act 2000. EIS and SEIS tax relief schemes significantly affect preferred share structuring — shares must qualify under the relevant scheme, which may restrict certain investor-protective terms.",{"code":493,"name":494,"flag_asset_id":495,"note":496},"eu","European Union","flag-eu","Preferred share rights and investor protections in EU member states are governed by national corporate law, which varies significantly — German GmbH and AG structures, French SAS structures, and Dutch BV structures each have distinct rules on share class creation, minority protections, and shareholder agreements. The EU Prospectus Regulation exempts small offerings (under €8M in most member states) from full prospectus requirements, but private placement rules differ by country. GDPR obligations also apply to investor data collected during the accreditation and KYC process.",[235,254,243,250,498,499,500,501,502,503,504,505],"shareholders-agreement-D1016","non-disclosure-agreement-nda-D12692","term-sheet-D473","board-resolution-D78","rights-agreement-D13037","voting-trust-agreement-D926","right-of-first-refusal-agreement-D5157","business-plan-canvas-(one-page)-D12527",{"emit_how_to":198,"emit_defined_term":198},{"primary_folder":98,"secondary_folder":508,"document_type":509,"industry":510,"business_stage":511,"tags":512,"confidence":517},"equity-and-mergers","agreement","general","growth",[513,511,514,515,516],"fundraising","preferred-stock","equity-financing","investor-agreement",0.95,"\u003Ch2>What is a Preferred Stock Purchase Agreement?\u003C/h2>\n\u003Cp>A \u003Cstrong>Preferred Stock Purchase Agreement (PSPA)\u003C/strong> is a binding contract between a company and one or more investors that governs the issuance and sale of preferred shares in a priced equity financing round. It records the agreed share price, total investment amount, and the rights attached to the new share class — including liquidation preference and anti-dilution protection — while establishing the representations, warranties, and post-closing obligations that protect both sides of the transaction. Unlike a convertible note or SAFE, a PSPA closes a defined round at a fixed valuation and gives investors immediate preferred stockholder status, making it the standard instrument for Series Seed, Series A, and subsequent institutional financing rounds.\u003C/p>\n\u003Ch2>Why You Need This Document\u003C/h2>\n\u003Cp>Raising equity capital without a properly executed preferred stock purchase agreement exposes both founders and investors to serious legal and financial risk. Without documented representations and warranties, investors have no contractual basis to seek recourse if material facts about the company turn out to be false. Without a completed investor schedule, there is no enforceable record of each party's commitment or share count — disputes over round size and ownership percentage become credibility contests instead of contract questions. Beyond the immediate round, a poorly drafted or missing PSPA creates a broken cap table that complicates every subsequent financing, acquisition due diligence, and equity compensation grant. This template gives you a structured, attorney-reviewable starting point that captures the essential mechanics of the transaction in the format institutional investors and their counsel expect to see.\u003C/p>\n",1781185949975]