A California Angel Investor Agreement refers to a legally binding contract between an angel investor and a startup company based in California. This agreement outlines the terms and conditions under which the angel investor provides funding to the startup in exchange for equity or convertible debt. California is renowned for its thriving startup ecosystem, making it a hub for angel investments. The California Angel Investor Agreement typically covers multiple key aspects to protect the rights and interests of both parties. These aspects may include the investment amount, ownership percentage, preferred stock or convertible debt terms, governance rights, anti-dilution provisions, liquidation preferences, and various other terms related to the investment. There are different types of California Angel Investor Agreements, each with their own specific characteristics and purposes. Some of these types include: 1. Equity Financing Agreement: This agreement involves the angel investor providing funds in exchange for shares of stock in the startup. The ownership percentage is determined based on the agreed-upon valuation of the company. 2. Convertible Note Agreement: In this type of agreement, the angel investor provides a loan to the startup, which can be converted into equity at a later stage, usually during a future financing round. Convertible notes often offer benefits such as discount rates or caps to incentivize the investor's early support. 3. SAFE (Simple Agreement for Future Equity): A relatively newer type of agreement, SAFE allows for a more streamlined and standardized investment process. It grants the investor the right to acquire shares in the future, upon the occurrence of specified triggering events, such as a subsequent equity financing round. 4. Revenue Share Agreement: This agreement is less common in the angel investing world but still utilized in certain cases. It involves the angel investor receiving a percentage of the startup's revenues until a predetermined return on investment is achieved. When drafting a California Angel Investor Agreement, both parties should seek legal counsel to ensure compliance with applicable state laws and regulations. Additionally, the agreement should consider the specific circumstances of the startup and the angel investor to tailor the terms accordingly. It is crucial for both parties to clearly understand and negotiate the terms of the agreement to foster a mutually beneficial and successful partnership.
Para su conveniencia, debajo del texto en español le brindamos la versión completa de este formulario en inglés. For your convenience, the complete English version of this form is attached below the Spanish version.