Alaska Angel Fund Promissory Note Term Sheet

• Category: Small Business - Investment or Funding
• State: Multi-State
• Control #: US-ENTREP-004-2
• Format: Word; Rich Text

Description

"An angel investor or angel (also known as a business angel or informal investor) is an affluent individual who provides capital for a business start-up, usually in exchange for convertible debt or ownership equity. New start-up companies often turn to the private equity market for seed money because the formal equity market is reluctant to fund risky undertakings. In addition to their willingness to invest in a start-up, angel investors may bring other assets to the partnership. They are often a source of encouragement; they may be mentors in how best to guide a new business through the start-up phase and they are often willing to do this while staying out of the day-to-day management of the business.
Term sheet is a non-binding agreement setting forth the basic terms and conditions under which an investment will be made."

Alaska Angel Fund Promissory Note Term Sheet is a legally binding document outlining the terms and conditions of a loan agreement between the Alaska Angel Fund and the borrower. This term sheet acts as a precursor to the formal agreement and serves as a framework for negotiations between parties. The Alaska Angel Fund Promissory Note Term Sheet typically includes several key components such as: 1. Loan Amount: Specifies the total amount of money borrowed by the borrower from the Alaska Angel Fund. 2. Interest Rate: States the fixed or variable rate at which interest will accrue on the loan amount. The interest rate is usually expressed as a percentage and is subject to negotiation. 3. Repayment Terms: Outlines the repayment schedule agreed upon by both parties, specifying the frequency and duration of payments. It also identifies if the interest is to be paid separately or included in the repayment amount. 4. Collateral: Describes any assets or property that will be pledged as security for the loan. This ensures that the lender has a form of recourse in case the borrower defaults on the loan. 5. Events of Default: Identifies the circumstances under which the borrower will be considered in default, such as late payments, bankruptcy, or breach of any agreed-upon terms. It also outlines the remedies available to the Alaska Angel Fund in case of default. 6. Prepayment Clause: States whether the borrower has the option to make early repayments without incurring any penalties or if there are restrictions on prepayment. Different types of Alaska Angel Fund Promissory Note Term Sheets may exist depending on the specific purposes or requirements of the loan. For instance, there could be a short-term loan term sheet with a repayment period of less than a year, or a long-term loan term sheet for loans with extended repayment periods. Additionally, there may be variations based on the type of borrower (individual or corporate) or the nature of the loan (commercial, business startup, real estate, etc.). It is important for both parties involved in the loan agreement to thoroughly review and understand the terms stated in the Alaska Angel Fund Promissory Note Term Sheet before proceeding with the formal agreement. Consulting with legal professionals is advised to ensure compliance with applicable laws and to protect the interests of both the borrower and the Alaska Angel Fund.