Startup Funding Espresso -- Redemption Facilitation Process
Redemption Facilitation Process Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. In an early-exit term sheet, it\u2019s important to have a redemption facilitation process. This includes the steps for setting up the bank accounts, capturing the investor\u2019s interest, providing payouts, and investor updates. The process also tracks escrow of repayment funds and later revenue share payments to complete the redemption process. For the redemption exercise, here is the timeline and steps: 180 days from Note maturity: Capture the current version of the cap table and financials, including the current income statement and balance sheet Send a notice to the investors to consider their decision to redeem 90 days from Note maturity Confirm the investors\u2019 decision to redeem Prepare payment options for the company to consider\xa0 60 days from Note maturity date Send notice to the investors of impending maturity and confirm their decision on redemption 30 days from Note maturity date Update investors with status on a regular basis Send notice of redemption to the company and ask for payment due in one week 23 days from Note maturity date If payment is not received, then a payment plan will be due in one week by the company 16 days from Note maturity date if no payment plan is provided Set up a follow-up meeting with the company to discuss options Upon maturity of the Note or in the event of a Corporate Transaction payment Create a promissory note of the debt due Elect a board of directors with investors having a majority control Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.Let\u2019s go startup something today. ___________________________________ For more episodes from Investor Connect, please visit the site at: \xa0 Check out our other podcasts here: \xa0 For Investors check out: \xa0 For Startups check out: \xa0 For eGuides check out: \xa0 For upcoming Events, check out \xa0 For Feedback please contact info@tencapital.group\xa0\xa0 Please , share, and leave a review. Music courtesy of .