Term sheet for a convertible debt financing
A convertible debt financing, like a preferred stock financing, is usually negotiated at first as a non-binding term sheet, rather than a full set of financing documents. The advantage of this is that it allows parties to wait and only invest in the higher cost of negotiating and preparing a full set of investment documents when the business principals have achieved consensus regarding the convertible debt offering’s material terms. Conducting the negotiation at a high or summary level in a term sheet (relative to..
The “defacto” dissolution of a California LLC; it can result in member personal liability for a judgment against the dissolved LLC
California law provides generally that members of a limited liability company (LLC) are not personally liable for LLC “debts, obligations, or other liabilities.” There are, of course, exceptions. These include:
a member’s liability under the equitable alter ego doctrine;
a member’s co-signing for a LLC debt or guarantying a LLC’s performance under a contract;
a member’s liability for his or her own wrongful acts – regardless of whether the member was acting as an agent for the LLC or not..