Investment Checklist
A.
Terms of Loan and Equity Participation 1. 1.01 Loan Terms Amount of Loan: $______ Interest Rate: Repayment Schedule: Amount: Period: Other Provisions: 1.02 1.03 Note Form Prepayment Penalty: None or ______% Multiples of $ Applied to installments in inverse order of maturity; or pro rata reduction of all installments 1.04 Deferred Disbursement Conditions of performance: Date of report of performance: Expiration date of commitment: Standby fee: 1.05 Guaranty—Unconditional and independent of borrower's obligations affiliated companies principal individual(s) of borrower
1.06
Security Interest real estate mortgage security interest in collateral: receivables/inventory/fixtures/machinery and general intangibles; filing and perfection of lien first lien or subordinated
1.07
Pledge and Delivery of Stock of Borrower to secure performance of obligation Pledge Agreement enforceable by Lender on default or threatened default Dividend and voting rights remain with Stockholders unless Lender exercises its rights
1.08
Loan Subordinated to To Whom: Amount: Terms:
2. 2.01
Equity Participation—in form of (detachable) warrants, options or convertible debentures Terms of Participation a. b. c. d. expiration date percentage of equity purchase price reservation of stock Anti-dilution Provision a. Borrower may not issue shares for cash consideration less than “exercise price,” paid or payable by Investor (or “book value” or “market value”) without adjusting the number of shares available to Investor so that percentage of Borrower's equity available to Investor and exercise price remains the same. Issues of shares at cash consideration above amount paid or payable by Investor at Company's discretion
2.02
b.
• right of first refusal to Investor • public offerings exempted c. Other changes in capitalization with Investor's approval: • stock dividends • rights, options and warrants • to employees • reclassification, division and change in par value of shares • merger, acquisition by or of issuer, dissolution d. 2.03 a. b. c. d. 2.04 Prior notice to Investor of any adjustment Registration of Shares Investment representation by Investor At request of Investor, (insert number) times, at issuer's expense; thereafter at Investor's expense Plus rights incidental to any registration by Issuer of any other of its shares, without cost to Investor Indemnification of Investors and underwriters and others acting for Investor Right of Co-Sale Stockholders may sell, hypothecate or transfer shares of issuer subject to right of first refusal of Investor to purchase or to participate pro rata in sale with selling stockholders • exceptions: • estate planning and intra-family transfers B. Description of Parties 3.01 Issuer Name: Address:
Negotiating Officer: Telephone Number: Name and Address of Accountant: Phone No.: Name and Address of Attorney: Phone No.: 3.02 3.03 Affiliates and Subsidiaries Investor(s) Sponsor: Participants: C. Additional Agreements Insurance Insureds: Amount: Term: Assigned to Investor: Employment Agreements Employee(s), term, amount Debt subordinated to Debt due to Investors