Puerto Rico Angel Fund Promissory Note Term Sheet

• Category: Small Business - Investment or Funding
• State: Multi-State
• Control #: US-ENTREP-004-1
• 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.

Puerto Rico Angel Fund Promissory Note Term Sheet is a legal document that outlines the terms and conditions of a loan agreement between the Puerto Rico Angel Fund (PRAY) and a borrower. It serves as a tool for facilitating financing opportunities for startups and early-stage businesses based in Puerto Rico. The PRAY Promissory Note Term Sheet encompasses several key elements necessary for the loan agreement. These include the loan amount, interest rate, repayment schedule, default provisions, collateral requirements, and any other specific conditions agreed upon by the parties involved. Different types of Puerto Rico Angel Fund Promissory Note Term Sheets may exist depending on the specific financing needs of the borrower. Some variations could include convertible notes, which provide an option for the loan to convert into equity at a later date or trigger certain events. Another type might be a secured promissory note, where the borrower pledges assets as collateral to secure the loan. In addition, certain term sheets may include provisions for finding a lead investor, setting milestones for future funding rounds, or incorporating options for early loan repayment. Each term sheet is customized according to the borrower's unique circumstances and business plan and is subject to negotiations between the parties involved. Overall, the Puerto Rico Angel Fund Promissory Note Term Sheet is an essential document that safeguards the interests of both the borrower and the PRAY by establishing clear guidelines for loan repayment and protecting the investment made by the fund. It provides a foundation for financial stability and growth within Puerto Rico's startup ecosystem, fostering entrepreneurship and economic development in the region.