Senior Loan Term Sheet

I. Overview

This Term Sheet outlines the principal terms and conditions proposed for the Senior Loan to be extended to [Your Company Name] ("Borrower") by [Lender Name] ("Lender"). This document serves as a preliminary agreement and will be followed by a definitive loan agreement that elaborates on the terms herein in greater detail. This Term Sheet is intended to facilitate further discussions and does not constitute a legally binding obligation until a full agreement is executed by all parties.

Borrower: [Your Company Name]
Lender: [Lender Name]
Purpose of Loan: The funds will be used for [Specify Purpose of Loan, e.g., working capital, expansion, debt refinancing].
Date of Issue: [Date]

II. Loan Amount and Disbursement

Total Loan Amount: The total loan amount will be [Specify Loan Amount].
Disbursement Schedule: The loan amount will be disbursed as follows:
- First Disbursement: [Specify Amount] on [Specify Date]
- Subsequent Disbursements: Based on milestones agreed between [Your Company Name] and [Lender Name].
Final Disbursement: To be made by [Specify Date], subject to fulfillment of conditions set forth in this Term Sheet.

III. Interest Rate and Repayment Terms

Interest Rate: The loan will carry an interest rate of [Specify Interest Rate]% per annum.
Interest Calculation: Interest will be calculated on a 360-day year basis and charged on the actual outstanding balance.
Repayment Schedule:
- Repayment will commence [Specify Period, e.g., six months] after the first disbursement.
- The loan will be repaid in [Specify Number] equal quarterly installments of principal plus accrued interest, starting [Specify Start Date].

IV. Security and Covenants

Collateral: The loan will be secured by [Specify Collateral, e.g., property, equipment, inventory].
Covenants: [Your Company Name] agrees to maintain the following financial ratios throughout the term of the loan:
- Debt to Equity Ratio: Not to exceed [Specify Ratio]
- Current Ratio: Minimum of [Specify Ratio]
Additional Security: [Your Company Name] will provide [Additional Security Measures] if specific performance targets are not met.

V. Conditions Precedent to Disbursement

Legal and Regulatory Approvals: All necessary legal and regulatory approvals must be obtained prior to any disbursement of the loan funds.
Due Diligence: Completion of satisfactory due diligence by [Lender Name], including but not limited to financial, legal, and operational aspects of [Your Company Name].
Documentation: Execution of definitive loan documentation including but not limited to a Loan Agreement, Security Agreement, and any other related documents.

VI. Representations and Warranties

Accuracy of Information: [Your Company Name] represents and warrants that all financial statements and other information provided to [Lender Name] are true, accurate, and complete.
Compliance with Laws: [Your Company Name] warrants that it is and will remain in compliance with all laws and regulations applicable to its operations and the use of the loan funds.

VII. Miscellaneous

Governing Law: This Term Sheet and the ensuing loan documents will be governed by the laws of [Specify Jurisdiction].
Confidentiality: Both parties agree to keep the terms of this loan and all related negotiations confidential.
Amendment: This Term Sheet can only be amended in writing signed by both parties.

This Term Sheet is intended to outline the fundamental terms of a Senior Loan and facilitate further negotiation towards a definitive agreement. Please review carefully and provide feedback or confirmation of the terms so that we may proceed to finalize the loan documentation.

Name: [Your Name]

Date: [Date Signed]

Name: [Lender's Name]

Date: [Date Signed]