2. Control Terms

2.2. Information Rights

To be able to exercise their voting and control rights in a reasonable way, investors must be able to obtain the necessary information from the company. To secure access to this information, the term sheets usually grant investors with specific information rights.

 

Information Rights:
 
So long as any of the Series A Preferred is outstanding, the Company will deliver to each Investor annual, quarterly and monthly financial statements, annual budgets and other information reasonably requested by an Investor. 

 

At later stages, when the company has a lager number of shareholders, and possibly also smaller shareholders, information rights could be limited, for practicality, to a set of investors that exceed a certain threshold. For example, the above clause could be limited to shareholders with 500'000 or more shares.