Difference between revisions of "Loan Notes"
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A loan note is an extended form of I Owe You (IOU) document from one party to another. Loan notes are usually provided in lieu of cash at the payee's request. A loan note denotes a type of contract that typically outlines the legal obligations of the lender and the borrower. | A loan note is an extended form of I Owe You (IOU) document from one party to another. Loan notes are usually provided in lieu of cash at the payee's request. A loan note denotes a type of contract that typically outlines the legal obligations of the lender and the borrower. | ||
| − | In a FairShares enterprise that is converting from a private company to either a [[FairShares Company]] or [[FairShares Co-operative|Co-operative]], a [[Founder Repayment]] may be agreed in the form of Loan Notes with an obligation to repay the outgoing [[Founder Member]]s before [[Capital | + | In a FairShares enterprise that is converting from a private company to either a [[FairShares Company]] or [[FairShares Co-operative|Co-operative]], a [[Founder Repayment]] may be agreed in the form of Loan Notes with an obligation to repay the outgoing [[Founder Member]]s before [[Capital Gain]]s are distributed to [[Member]]s. |
Loan Notes and [[Founder Repayment]]s were first defined in FairShares Model Rules for Companies in V3.2 of the [[FairShares Model]]. | Loan Notes and [[Founder Repayment]]s were first defined in FairShares Model Rules for Companies in V3.2 of the [[FairShares Model]]. | ||
Latest revision as of 06:13, 3 February 2021
A loan note is an extended form of I Owe You (IOU) document from one party to another. Loan notes are usually provided in lieu of cash at the payee's request. A loan note denotes a type of contract that typically outlines the legal obligations of the lender and the borrower.
In a FairShares enterprise that is converting from a private company to either a FairShares Company or Co-operative, a Founder Repayment may be agreed in the form of Loan Notes with an obligation to repay the outgoing Founder Members before Capital Gains are distributed to Members.
Loan Notes and Founder Repayments were first defined in FairShares Model Rules for Companies in V3.2 of the FairShares Model.
Back to FairShares Glossary.
