Fina5390 s5 1 Term Sheets Reading Materials 2018

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HONG KONG UNIVERSITY OF SCIENCE & TECHNOLOGY THE MBA PROGRAM VENTURE CAPITAL & PRIVATE EQUITY by Prof. Laurence C. Franklin SESSION FIVE READING MATERIALS Posece Veclisd Gaile 8 Baek F pt, Vol. He Lennart Hetyne 20 A Private Equity Glossary sect, os yt go a i mt So. mea ire memati seems Tanieit sncSESTT ee tis na ic itt Scefuieriwa acs sap re te AP ete pe nea ay Megabit ce Teac cs ace fea Tied Sw oe hn oye ‘chy ena ph Sr an ins PO Solitaria bale sec pele a te tt no poh ne Tae sey db rir Y sgn fel tty teh SSSR SSC tin ent, a nie cpa Kye TET ‘fect ee che snl vate porphin tram pin apy eee @v Biecomeiioey cee eres ‘peter ete ae auth itt nen i mea ope Senet tae ecules se Sheree anges eh sa Tape atl ge el enya jot Seengectner poet tae ‘meatal pe fie coo alee SIanEIL aE enetaroe a Serncegrt So : lie Eee STE ras neste tn la eae tee ote en ainartin wate et SLOSS hat panty etmenemcratae ; ‘peice pcan bec eeneccnse | DEL LTSE esr ott ig ln ot e e Sry pt ae See a ae : ome ttt tm foe ru ant maatiat AN {16+ A Prete Epty Closary Ov ©’ v Ccallopion Te ih net gto, tb aan at ast een ng os) ‘ga psd. ai yo i he my rt tn ep ety Capital srutre Tonto ty and db ata fim hs aed {Copal wer management Cont eat {Cased intrt Th sata dc, oft od 0% of pos at weed he ocr pene of et gy pares Cclthup. Agron atime parapets oes wd i ccna ih ro "are een Th pon au he fr ata oral a ae a ‘ton sere aed pte ee pl bak aod pad retar Sach ‘sh opp smn flr wl he ene praevia. yep se ot sett 6g, 208) Cceteon hn sy fap pte prt yar och Ea il termes re ony or esi (lay bck peion ted prtoery agrmer at roue gan parae Tow fe Entel pons at he od fs ay sad ase ‘ben ter conta spose a (Copod.ond fend. 873d sulfur wie hares oust be ol wer sas Cte hn sdeecd rth ng ea th a wil open maa ne any oy ante opal ad wre rate ths nae (toning TiS ef cot yo vero af te at ade em a ‘upstate ly Ofte facta 0 a cpa pr. Sra ec ft Sng Angle fd ay ipl sotge CCodnrestnent ith) the ation oot Moc oad sr gestion) ‘ran etal ysis glo nd pros snes pas ey nd a Snag red Cllr Aint cn onl ube of al od pt opin ogy nt mc Commit pt” Ehigs fei pate sty ond, Ti mena ipl ste ed oy, tt ert own cr hee young a ar ad Fiend CComnen sock Th guy pial ly agent sd odes Tay ath me anal pu cing ol equ ect ato como irelopnst vont epi Vere cpl nds pind by no pat yn go rng oon Seen eg Companion fd fed fn ied wt ese ine a a ado rae egy fd, ‘lars cs sents os ron ety pop. Th ae ba ae ‘Eres gy ded ee sd cd nee) han rena Conmiation A ot gay vent sag at vb rpg wal Tepter ed esting vans of lo oa CConrrson rao Tins hr or wish tamer to gic cour guy o abt sty tn ude crannies cin come “other wc (eto cme Hos). The comets aces en re pc he ‘ES theca tk des ot be A Pao Spy Ciry + ATT Cea crunch A psa ws, dt ha opie soon of ifn he camo “ayy ton a ah rally of ian ae ng pa ‘ty fran bc The ay 1D vr oe ul pel nth Uno Stas. ‘Cumulative redeem pierre stock Su edema peered ee Depsvaionted eee Teves lang sles a tetas to pt up 8 eh Tost, anal mop om 0% SD ft tl ae Dilated tn faton os rt equty oman by ts found wad tag hares setd i ao Beng Dive investment eat by ned partner fad Fd ao et ‘loess Se isburemnt Az ost y pn oft nox ompny Disresned dct h pe egy ett ng at ae parsg Ant Trl of aan Sore in Dutra ovary cove al poy nd bce ly el with th meget fh eel Br isbn Te rr of rer (palpably cept fm oak pay Sr oh prt td (gue woh poel prt ows ron ang hr i hao th om oer en hat pe ow reed ew dow ta owe uo ilgone Thess bie lsd emneat of mangement ea port "pt ey eee ‘arsgs ore treet sd tees (ERE). Aur the Set rai bee my stn rent eens bx bigtime Te marr fen wed pa ‘Eom wi iftane ll ntednse ‘Employes Reement Icene Sey At GERISA) ‘The 107s at cl "gion sf pte pon ps Se Profle! at a ‘Eadomeat. ‘The eng tn lost stad my ret, etl, “ton 0d ctr snp intone gspment do Tha wets asa act hte when th ess ot “do doe dr och papel sma git eke ton kl peo eo wart ao el hat ‘my «et Smeg ‘cree pee Ti poe eich on opton oat abe enced ‘Enema porate vote cpt soca ete al gram ha st nc Trop fom ences ise lnc een ude doggie eat peat Tinaeing rund Th pon of pil by jai gay pp fx Sie. Sao vate opt opuaatons en pre stl stapes = yeti cod en ‘he oad eancig uc oer ons of os ‘em tion hn neg nn th adorns he im cer ps “hs pros ying insure fo th on ad he sling en Inna in ‘Comatose’ on tht ble te taste th ak he ode ‘ry ey ow in lng Tho tl ig fund ‘it lar cry A prota n Sind ptaarip at allow gael parton ors “aaltepet es bon rere id parts. ‘Tho more tated asm hat bh he ive copa td tho genet Tons rte std oe hd pasta isthe ger pres eure aed it fund) Ay tal nd ied ly «pet ety apa; do Bown ste ‘Matias le act ei tn yrectag of be open ns at th ands ou oan ope ng bl by arate. 08 A rt gat Chg ello fnd_A fad at engi pe oye et id {oliowan arog Ss Sond cy ease an Por 1OX' Ae eng pny US rut ad Ett Cie each +" ly lo ea wel cata pate fer Ts stent onde oe suds oe fra ‘uo het Soe Lerten ony ht 8 ‘ead problem ie eps die wil epee heh nt cde ero o vermis cen yer ‘Peon sd fly food Sr empaee ol tn pen rae eye ay ae eB a ttn pees psc Spiny Eas ‘onto soa oe rates pie e od of fnds Ain tht ves ely oer ee out ater the pr- Ing mn en eon’ bys vse in rts bod cep “i ae Genera tert «Eee pup opie fre dy gre Tens ie and toes a ely fd hr nr epeainsar e sol puters erom be sxporioc thee pea peters Te ee pens ‘ta kyr hf debe ae ‘atl At "The 153 gn ited he ety hing nd dang a ttn of mers ba ate United Ste eandtaning problem The snp santero y young pte uy ep ts, of aag yng Bor pac mcagher ia tarts aeons oe Eitan Senin spi a tars pple Cot Sow option hp osm schrng pce et allot hand to oe etna acetyl he te ft ey, ‘ecg A sate est ln tests ees reno ete vauofen atng asters aon Fert femme apna ang pps agg Sa be ar ane abo i ening rolem A tation a which tracy nto mb ete at ut ere snr oe ae thans date ‘Moi et Aa oh ead tw cee flag pry pte age arn tt taj bn per et ‘tl toe ag rn yb or oe fan 7 Berle ec rh gir par ap tng esr mpl rat Abo lc he ps fle te tp a Seas a 7 ea pit ttn il nnn np cp {nthe mony ono wart ht wad pate vale ty Inadertet ivestment company Aa operticg any flea ner the ed ‘At dan af nest copay Ne _ nal pb ring PO) The nr farses aff ht a 7 calcein pti ck eng a nesta bok peal cnr ere a Inia swat a pte 28) company aay 7 tal ptt steal own bd pa te Internal corporate vente apt program A capo tar al pgs at ‘ss bss coer ogni the rrcten \N A itty Coury © $09 ncaproncuing Acct tre aia ga hoe uns ep ig gas ic crv. Te to es old peal els whch expt nee an ese vee. Aavstent adver fool itr wait eons ply i, iE mrnnoct in emt mynd oie sae: Ades se otal vo TELE fr or eat ad acter th pgs of eg vest Tn sane le ey pos th ot opt i of Avestan bank fone nrodatry ht ogre, my inflow Cer lls ‘lees wl nis a ade or oma ont oe te ca ol oe vet Coeuny at of 1940 Engst gcd ems erage Stems wa opting est ud fande Ame oan of pub td es a ‘ame vestments Sr don fr Th term oly edn ret eta. avsarbeyt (BO) Sr Mgnt by. {ens tne Sata ow ced» cet Bt lws avec le oan “oat of wom tell eguptot at beaded, acolg tb peor own oii ‘Lemont problem Ser hyo rman pole [Emr Te pery wince agemet wo oer tombe mal etl pms Sc iteapa Sage ee ~ eset “To pry tna geen war eile equpet git aoe a Be SESE ete tn eo bl py evegel ayo (200) Te etn ror son ak ean at “ety ls couse sto The Stn ropa seg «ot ‘SL tnt snc ma rt ck i. . Leveraged bot fondo a sar mene tat. eae a ee eer Sound ements ke as ci tne ‘Leiged Topaiton A tasao wich he mugen tu (ar ew "smc ca fen D0 toe ony yo tees of tee Rieti tetera _ cane ie along pew ayo ec et Teor nme Sane poet ‘cacy ins nntag igre yw erie paymznt eng pr Spies oar schol, pre bad an tore “ine etnies HO, he peo depen cas mlb bl or al or a be ogcet yet pce 1000 Shares, Sot sie ime Sgt “inte pre "A nestor od pent Led prot ep SD reget mt bone Sed a dey nage hy Sateen. “ined prtcrip hn onsttonal fs ht es ately ed onto ange Macs betas odd gen parson, goed yx ee een Lielon preference prvi las pal sock cin. ron tt at Tuc crescent wth foro yee pues nto eh ‘Eig oo bm ockep A proven codbting sre wes niet bok ing Se alan py ome ook ak Sr daw ink 180 + A Pict Sty Canary Management hyn (MBI) Burpee term ers BO ate by pb yeep “SDR mo pros oes tthe om C7. Management boyet (M0) Bsrcpen term a BO it ya esting ge ‘Set om, ws hn i ees a peas oy gn Management oe Th fe, ply = prtag of canted ato neta he 7 Opi oy pt sty id pen puta co sins a pee __- Moning seoeal prt Ti rl pre er ern) wo cay pe er th mangement of he S® AWS @ @ @ Market maar” Th cepa ys eset xo ig te gal "feng gh uy Aa ut a a, he adh rey ‘Staal ery af ce cacy Mariettbook ratio Te ner of he ba ot at wa ree engeenmnneentcan eee te ce atone Se ae marernerene 1 Se fees da iene maracas yt Sfes a ie aera See agittnvamnetmnscaaaeninne soci ae ee coe Seb eben ne RET Eee ey namie ja nts rae mre tera Ze rE han sa eS, enyanuantiine gee es career heats = ef ae ggte etomrepge gees eg ir hms peor Uae eee ee 2S Soares ae Yok ReagEAEE ES wtp oy sven eee oa tegen a oe es eye rc te Settee eee een niga eee eran J CD Etta lac \ \ Arnos Eyity Clowary + 48 palin (eer partner) darn ite ety fds Mo, Jnl tt ei {2 scuiesmen between he gnu pros ough trl pans te fale the dos of he cared tra PE oman pt ete or me et ra pte a ‘Poni ck fo of open, ene wed a rl expr weno ‘lpn, wir ees rsa poo ta ma ace eed fo lng otk opis, thre ey dno seal dey Thee peso loin ‘np toc and como rear Plaomont agent A fone noday hel by pe equ oats wo ae he rang fe de ota Gon prt of rts ogy fads pot, The esr pana fa pt iy and ace fon sso pt 20% 0 th cap on hha hd og 5 ttl patos. \/ Postenaney Yon, The pod th pes paper tha sag ou se tho “are oan fh ang rtd Proforeed rtm A presins inital ptonbip pean iss end Peter ot ot ony nepal a sorry ped ity of eae 7 Sata find fr th ne prt rss my cad ir ‘Prefered sack So hat a rfrtc rrsanen sack rent ay deed 7 eae tain th igs he om Pn aan ay Tox Uae gs ch he ily to lak mene rpc nga Prectomay valuation ibm pod oh uo pid pr Sa ns Bann dad the cr aang fe he alg ued acer a nt at om eng ‘ima verte Aa ent ys ld pata indo dt pe Ty prom sng cap fm es ‘eta egy Crp dtd arta apa eee ayo nasi, (7 te el tm way a a el wae ng ‘tte placomest The lof ci ct etre wih the US Secs nd sng "Gono inten iver eli ae The eects ay ‘lta yan verte ke 7 Times Ta cen el rast a ps “Resale iy dmmited ver of the ote atest ht ao “BeSwhide Us seis nd Schange Common Tae eyes els idee ‘yo sy soa the re nto bela st feper ai ‘Prudent man Flo Poor 9 173,» povison fn tae Epp treme nce Soy “et (ERISA) ae emily poked penton fn eit st of 7 Sey in pts eyo er igh et chee The Deptt f La a ‘St of he eth ur owed pnsn manger t net igh se es, ete cy ‘ble rentre pt Yen capt an orp’ by genet bas, ale Fo (gas tal venture Se nung ith ple ft, plein the Seal Bus ‘Sr Invermen Camany td Smal Buse noon Rese propre. Gs) a pian Tag rth tin is oye ora) “ages pe 7 Pata sary th sche a wa opto sl ba tothe ce (Qualified Inventor "User he 1008 anecdote 40 Act ainda or tain Sob sine os bated on et worth nme, Thee sien ems a ‘tog oe sar re Lghr haa hewn fer node es. G98 © (2 + A Pate Hpty Clomary ed baring A rcliiny ven of he ppc tt itd opt invests 7 ers sy reg To ae dacs Bor i noes ply pe do Redeemable peered sak Pema sock wine he arb ocgttcmet the @ 7 "mim eco ay eo de ‘ens fda pn ad i tars ft ce ase oh tac, hl at the cnt spend nero fh py at noe tte Region gh provision Ia resin ork ert pon ta alow be pe Yo gay ts fle th senpny ogo Pi ol tha ssw pat le lng at ho mn ecrehing ‘ogtraontaemeot”A Bog i U.S nd angen ,a0 So snes te mt bre ye Coomton ae en ao {hope Ti stem ror a ido iy amaryl sso ay done. Reveal ast lng he racket i of heed eis ted ‘ee te Rasrsted sock Seth cect be ld der US ester nd Eng Comndtion ‘pans rt enon be wld in ed aout. Revers claw ack ns ised pti rere oie that ue nod pat es ort Fs oh eal pat a nd he nd fy ave nod toe the eon poi are BH), bet ta" nc tn at gs ae ae yd 7 tic pubis, Rowse, or et nl epee ssned ek thor cp ‘ato na tharos scot Awan eno spoon end ovghtel Bt ok oad on Theat os phate oy nd pb cng to tel er. Rabup Su Cretnon Towad ec Png ound oyun og agent he percetgy fe or rie ht he eee py fa ASE peste cpl bn em scirabemeg ty anes rics a nea nS scmy att Geen oan ee ee er ae tateee aoatuar nt sufihg Brice ite tne 22 aqeneatrn ise ood Separate Sr eneeals camecncee nee Seana memoria rp tren resttnsenea ied tte Se gee Seaoce egy osring ha sig by fn ht a ely cmp on nl plc 7 SERS seep tor Sea ce iganen Sel merece eae ay Tab cacng slo. Conceorly doit mt pce es ales ofthese shares. aes ae ee ee Saas rete errr anne Sayan ane Se ota ero compa Small sins Investment Company (SBIC) program foul gaat! uk i ol Thar ds wre thn yh Cano, rd Sag the A Pte iy lang + 48 1 ete var my pins ort sit nen soit apts. cnt ols a oll ope we it pt 7p es por pen Spel ial tr tl tv ot ut eed ne fo Seen Lyi en ee etfs er peda pr Sting The pt oft nena iil nanen, heh @ 7 “Chanitmeeg ce acide easton eke ‘Scomuducla Seco ferent ds of uta (og tert ted pater Stock appredton right One pe of tom sock empenrion sem 7 Stig pared sok Sr elec peered ce 1, Sweet majoy voting provision In yore eck ecmec «prot ht ies hat wae tha ey fe rf eller pro 2g dan Syuieation The at parts hrs by tro ae tc ay psn th at une fing by oo mre insta ban “Take down Tos treo sre el of ecole om thn Bed pastas pte oy Find. ‘Tedown dale Th cect enguage tht Sox bow sd when pate ely and an (rt reste he cme xa om iia partes fea 70 hep ota gat wn nnn an rors Sn re ea Bal equpment be pursed 7 Tangle asset A mn, ug ln, stony or sethrgye aet ‘Tom of tens, Tn vesting, drt nae, sl mo, whe asd sept. ‘Term set "A pena ole of he strc fat ge patnp rk ps @ ¥ “Baer egeent, ey sd yn ey pt sb ole Tatneft yey mj bso bison by onder 7 paca flog th anderen ‘halle A oropen er f heng u etty ata ty rphy - S® 7 apis oaporaion ‘Dipet ulrpyout Teas a vst ag gt lee whch he es ase ats ce ha eich eed een se the ane cee a pent [ira ower ndadig sateen, oy ed at ‘Caceres opal ren nore rent, The wr “he opin af ttl oleh grate ey ‘Underpiding The unt the projet oo ik te etn ker oe 7 sats ata pablo A etl pst surah Bt ing ya ten npn y Snail oni nar erg, 7 Vadaretar The ttn a ho wee ni, ‘Underwetng ‘The prs ooo fos opty en emt bk ed 7 Ot py an inst) al oes ‘Unrelated buna tae feo (U1) Th gos inne vy elated bie Theta taremapt to oa ena ant pa egy pecan geen ncaa en abt end propery, area sed prac ye AGEs det ONT pros ‘Unsomoned uty lrg nial ub ig foe "ins tes apes soared oc wd ym ome othe eee ste tne at ant gn 84 + A vote Bpty lomo ‘Yehntion re Th algun by Wich ae ety nd ap oth ead 7 pint apts Venture epi Taped mash eed pal fel ut fu on ey ot ogy neste a pty oi Regret cain May eae pd End owee ezaenaly tle pee pte qu teen, Ouse ‘ated Sec, hs pow 8 es e's pag loa oy "ln ing tht he in ha et mane al ee seas pokes Seong dance mt * 7 Mestre copa A gon ste or wc pate mpi Ynture facturing, & prose arsenate a aera the or ‘fight ong fhe oma, th vote Rang a sey Soret na og entre lating” A pnt gly ret sittin agent oer tt hat young Arp ett, nae a a ply ‘Soteahe went young nm ‘Yeng A fon ener teens ht et pleat eestor Sonate sac pat nest Tegra ype psy iets pt fare a epee awed rn oe ses ing ita yer The up of fie wi ft lag wa a cea yu ‘Waratebve lene Un vont nung la he regs he gat egy pe “pases oh ce lin tn em ort 1 Wort hopin ty shat of ak ed yb coney ‘Window denny problon Th les many magus of stooge portly Then th uae by bg Sem we eave sen gn” ‘hss en by te tt nica eas nay cone tly gure eos, Int ao end peed lg ‘dca alerng A at in wih nittn stent deh US. 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