Select Page

Future Fund – Funding for a Post-COVID19 World

Jun 15 2020 | Legal

by Paul Britton

by Paul Britton

Director and Solicitor

In this article

Future fund – an investment or a loan?

The Future Fund is very much a loan which is backed by the government but offered by a third party creditor “UK FF Nominees Limited”. As a loan, there will be interest due, as well as a conversion term applicable either on maturation or when one of four trigger conditions are met.

By stating it’s convertible, this means that the loan has an option to be converted into shares rather than it being repaid.

The key points to bear in mind are:

  • Interest is non-compounding and is set at a minimum 8% APR but can be higher if both the company and investors agree
  • Interest is not payable on a monthly basis. It will accrue until the loan matures or is triggered by one of the conversion criteria
  • If the interest cannot be repaid, it will convert to equity
  • The loan cannot be repaid early unless all of the investors agree to this

 

Looking to book a consultation?

Show/Hide Comments (0 comments)
L

Other related articles.

Be the first to hear the latest from us.

All our latest updates direct from us, written by us. No spam, no passing your details on, just pure, unadulterated news.

And if you’ve heard enough from us, you can unsubscribe at any time.

Like it, share it.

If you found the contents of this blog useful, please feel free to share it on social media. Sharing our article helps others in need find the same information.

Be the first to hear the latest from us.

All our latest updates direct from us, written by us. No spam, no passing your details on, just pure, unadulterated news.

And if you’ve heard enough from us, you can unsubscribe at any time.

Like it, share it.

If you found the contents of this blog useful, please feel free to share it on social media. Sharing our article helps others in need find the same information.