How to charge deal legal fees to a portfolio company - for a standard equity investment
Hi There, Could someone walk me through the mechanics of how funds typically pay for deal legal fees out of the investment amount? Specifically, if I want to invest 100K in a startup, and the legal fees will be 5K: * does the term sheet and equity agreement state 95K? * does the fund pay the 5K to the lawyers directly? and transfers 95K to the company once the deal is closed? * in the deal memo and other investment documents, is this recorded as a 100K deal or a 95K deal? * are the deal metrics (DVPI, MOIC) calculated based on 95K or 100K? Am closing a warehouse deal in the next few weeks so would be great to get some guidance on how others have done this in the past.