A Term Sheet spells out the terms. It is a non-binding agreement that establishes a level of trust. It is a part of the due diligence phase, meaning there is an intention to proceed with the purchase. A general idea of how the transaction will play out might be included. A Term Sheet can open the door for negotiation and hopefully an investment or purchase.
If a borrower defaults, the lender has the right to recover their funds by liquidating assets or other means. It’s a tough spot, but having senior debt means the lender gets first dibs on any repayments.
Yes, many aspects of a term sheet can be negotiated! It’s like haggling at a flea market; you should always try to get the best deal possible.
Senior debt has priority over other debts in case of a company's liquidation. This means it's the first in line to be repaid, making it a lower risk for lenders.
Typically, senior debt is used by businesses looking to fund projects or expand. In Omaha, this can include everything from local startups to established companies aiming to grow.