At a bare minimum, you will need the following legal documents.
- A Non Disclosure Agreement (“NDA”): An NDA is a legal document that obligates one or both parties to keep any information shared during the process confidential.
- A term sheet / Letter of Intent (“LOI”): Term Sheets and Letters of Intent are non-binding legal documents that outline the key terms of the proposed deal. Many investors will issue their versions of these, and you’ll be responding/marking up their document.
- Transaction Docs: This is a package of documents that dictate the legal terms of the deal, including how the business will be managed going forward. It will include an operating agreement, a purchase agreement, voting agreements, etc.
Resources to Check out For Template Legal Docs
There are a few credible online sources of free template legal docs. These can be a helpful starting place, but you’ll want to customize the documents to suit your specific needs.
The law firm Cooley has a free resource center that includes downloadable transaction documents. It includes an incorporate package, seed stage financing docs, a non-disclosure document and several others. Link to Cooley’s transaction documents here.
The National Venture Capital Association of America also has good template legal documents available. Link to NVCA’s transaction documents here.
Always work with legal counsel to draft and negotiate these documents.