A person owes another fiduciary duties when that person has control over a financial interest of the other. For example, corporate directors owe fiduciary duties to that corporation’s stockholders.
The duty of care is one of the fiduciary duties and it is violated when an action is taken or not taken on the basis of inadequate information or without following a reasonable process.
A data room is a space (often virtual) used for storing information such as contracts or corporate documents typically with the intent to share that information in a secure and/or confidential fashion with others (such as with a potential acquiror).
Due diligence is the process of reviewing legal and financial documents relevant to a transaction prior to the finalization of a deal.
In a term sheet, there is commonly a requirement for temporary exclusivity that requires one or both parties to negotiate exclusively with the other for a limited time or under certain conditions so that the investment of resources and time into due diligence and negotiations intended to finalize the agreement does not get interrupted or wasted because of an interloping offer.
This preliminary request for documents template for UK companies will help you understand what investors will look for before they will close the the deal. It may be helpful as a guide for organizing your corporate and legal records now .
This sample due diligence request list will help you understand what VCs will look for before they'll close your financing.