Loan Note Subscription Agreement Generator for United States

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Key Requirements PROMPT example:

Loan Note Subscription Agreement

"I need a Loan Note Subscription Agreement for my tech startup to issue $5 million in secured loan notes to three institutional investors, with quarterly interest payments and a maturity date of March 15, 2025."

Document background
The Loan Note Subscription Agreement is essential when companies seek to raise debt financing through the issuance of loan notes to investors. This document, structured under U.S. securities laws, provides a comprehensive framework for the subscription process, detailing crucial elements such as interest rates, repayment terms, and security arrangements. It's particularly valuable for companies seeking alternative financing options to traditional bank loans or equity funding, while ensuring compliance with federal and state securities regulations. The agreement protects both issuer and subscriber interests by clearly defining rights, obligations, and remedies.
Suggested Sections

1. Parties: Identification of the issuer, subscriber(s), and any other relevant parties

2. Background: Context of the loan note issuance and purpose of the agreement

3. Definitions: Key terms used throughout the agreement

4. Subscription and Issue: Terms of subscription, payment and issuance of loan notes

5. Interest and Repayment: Interest rate, payment schedule, and repayment terms

6. Representations and Warranties: Statements of fact and assurances from both parties

7. Events of Default: Circumstances constituting default and consequences

8. Governing Law and Jurisdiction: Applicable law and dispute resolution provisions

Optional Sections

1. Security: Details of any security or collateral - include when the loan notes are secured

2. Conversion Rights: Terms for converting notes to equity - include for convertible loan notes

3. Transfer Restrictions: Limitations on transfer of notes - include when transfer restrictions are required

4. Subordination: Priority ranking of the notes - include when notes are subordinated to other debt

Suggested Schedules

1. Form of Loan Note: Template of the actual loan note certificate

2. Payment Schedule: Detailed repayment schedule including dates and amounts

3. Security Details: Details of any security or collateral arrangements

4. Subscriber Information: Details of subscribers including KYC information

5. Transfer Form: Template form for transferring notes

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Industries

Federal Securities Laws: Primary federal regulations including Securities Act of 1933 (Sections 4(a)(2) and Regulation D), Securities Exchange Act of 1934, Investment Company Act of 1940, and Trust Indenture Act of 1939

State Securities Laws (Blue Sky Laws): State-specific regulations covering registration requirements, exemptions, and disclosure requirements for securities offerings

Uniform Commercial Code (UCC): Particularly Articles 3 (Negotiable Instruments), 8 (Investment Securities), and 9 (Secured Transactions)

Federal Reserve Regulations: Including Regulation D (capital requirements) and Regulation U (margin requirements)

Tax Laws: Internal Revenue Code, state tax regulations, and FATCA compliance requirements for foreign investors

Anti-Money Laundering Laws: Bank Secrecy Act and USA PATRIOT Act requirements for financial transactions and investor verification

Consumer Protection Laws: Truth in Lending Act and state usury laws governing lending practices and interest rate limitations

Investment Adviser Regulations: Investment Advisers Act of 1940 requirements if investment advice is provided as part of the transaction

Corporate Law: State corporation laws and LLC laws governing business entity formation and operation

Bankruptcy Law: U.S. Bankruptcy Code provisions relating to creditor rights and protections in case of default

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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