Defining Assets For Your Will

Defining Assets For Your Will

Assets are an important part of any will. Defined as anything you own containing an economic value, assets can be a house, land, a car, jewelry, clothing, and whatever else this agreement it is possible to assign a monetary value. The objects just described these are known as tangible assets. Intangible assets also exist and include patents, copyrights, trademarks, and other rights that may have a worth but aren’t necessarily things themselves. For financial matters, you will need to know each of the assets which you own to calculate your total worth. When drafting a will, listing your assets can help you see how you would want to have your premises divided once you die.

Why Are Assets Important?

Knowing your assets is essential not merely to get a will, however for all financial concerns. If you enter into debt, liquidating assets could be the fastest way to resolve an outstanding balance. When requesting a loan to get a house, a vehicle, or education, banks, and mortgage companies may inquire about your revenue and total assets. It is always best if you know what you have and how it is worth it. In terms of estate planning, knowing your assets in an essential section of making a will. When you expire, your assets won’t just disappear into thin air. They are going to be passed on to others.

How You Can Protect Your Assets?

Wills and trusts provide great protection against having your assets divided or utilized in a way that you just would disapprove of. In a will, you possibly can specify who your beneficiaries will likely be and who will inherit which of the assets. In a trust fund, you’ll be able to secure money for any spouse, children, or perhaps an organization. Trusts can safeguard your hard-earned money from being taxed and enable that you set certain terms and conditions for how your assets were designed. If you don’t develop a will, you allow your assets vulnerable to being divided based on state intestacy laws and risk losing a tremendous portion to taxes. If you have always dreamed of creating certain possessions to a particular family or of donating a large sum of cash with an organization, wills and trust funds can assist you just do that.

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For more information on estate planning and protecting your assets, go to the web site of experienced Austin, Texas estate planning attorneys Slater Kennon Jameson, LLP today.… Read More

How to Calculate Liquidation Preference in a very Startup Business Venture Capital Financing Term Sheet

What is liquidation preference?

Liquidation preference identifies preferred shareholders’ rights for a specific amount for your preferred shares they hold in preference to common shareholders in case the business retreats into liquidation.

The scope of liquidation preference varies between different term sheets. Some may be extremely favorable to investors, some could be less. However, the goal of liquidation preference is really that in the event a business goes into liquidation, preferred shareholders will always get something back for their preferred shares before common shareholders get anything. In simple terms, they will always read more than common shareholders. Common shareholders may be certain to get nothing if the company won’t have enough assets to stay the preference amount.

Example A:

Venture Tech Ltd. has 5,000,000 common shares outstanding.

In a Series A financing, Investors A invests $2,000,000 in substitution for 2,500,000 Series A Preferred Shares (i.e., final cost per share = $0.8).

The term sheet of this Series A round provides that:

In case of your liquidation event, the preferred shareholders are going to be entitled to get instead of common shareholders a sum comparable to 2 times the price per share, plus declared and unpaid dividends (the “Initial Payment”). After the Initial Payment has been made fully, any assets remaining shall be distributed to the preferred shareholders (on an as-converted basis) and common shareholders over a pro-rata basis.

NOW, Venture Tech Ltd. switches into liquidation and the sale costs are US$6 million.

Assuming no declared and unpaid dividends, and all other senior debts, e.g., employees’ wages, secured debts, etc., have got all been settled:

How much will the most preferred shareholders get?

They first get US$0.8 x 2 = US$1.6 for each preferred shares they hold.

Therefore, the Initial Payment is US$1.6 x 2.5 million = US$4 million.

This gives US$2 million ($6 – $4 million) remaining, which shall be distributed to preferred shareholders and common shareholders over a pro-rata basis.

Therefore, preferred shareholders are certain to get a further US$2 million x 2.5 / 7.5 = US$666,666.

I.e., an overall total of US$4,666.666.

The common shareholders will get a total of US$2 million x 4 / 7.5 = US$1.333,333.

Total = US$4,666,666 + US$1,333,333 = US$6 million

Example B:

Following example A above, let’s imagine this time around the sale costs is US$10 million.

They are certain to get an overall of $4 million (the Initial Payment) + $6 million x 2.5 / 7.5 = $6 million

The common shareholders are certain to get an overall total of $4 million.

Example C (company favored):

Let’s provide a twist. This time everything is similar to above apart from the exact amount the preferred shareholders are certain to get per preferred share they hold is capped at 4 times the price per share.

In simple terms, they first get 2 times the cost per share ahead of common shareholders (i.e., the Initial Payment as in Example A and B). All remaining assets might be distributed one of them and common shareholders … Read More

Auto Financing, Bad Credit & Down Payments

Auto Financing, Bad Credit & Down Payments

If you have a low FICO score, you may find that it is a challenge to obtain good auto financing. Bad credit can affect your ability to obtain good interest rates, APRs and in many cases, getting general overall credit approval.

Fortunately, there are lending services that specialize in helping people in your situation.

For companies that specialize in this type of car financing, bad credit isn’t as difficult to overcome. Finding a good lending source that can help you to overcome your past credit problems and rebuild your credit bureau score without having to have a big down payment, can be a big help. Without using a service of this type, you may find that getting approved for auto financing with bad credit is very difficult.

Bad Credit Car Loan Company

Even if you’ve been refused or turned down at a local dealership for auto financing, bad credit car loan companies that specialize in assisting people with rebuilding their credit can help. Some companies understand that when you’ve gotten into a situation of having perpetual late payments and financial problems, it only makes things worse when you can’t get a car loan. These types of companies will work to help you and get you behind the wheel with a good auto loan with reasonable payment terms.

Prearranging Your Auto Finance

One great aspect of prearranging your auto financing is that you can shop for a car with confidence knowing what you can qualify for before you decide on a vehicle. Too many times, people decide on a vehicle before they know where they will obtain the funds. Cash isn’t floating around like it used to be for down payments, so you should really look into getting preapproved auto financing. Bad credit doesn’t have to hold you back if you just use the right kinds of lending services. There are a few legitimate sources online that can help you and work with you, rather than working against you.… Read More

Working Capital Finance – Your Problem – Our Solutions for Solving Cash Flow Challenges

It would be great to hear our clients say they have no issues in working capital finance and challenges, and that solving cash flow problems is the least of their worries. Unfortunately we haven’t met one customer that seems to be comfortable sharing that with us.

Let’s look at the root of some of those working capital challenges; what are the problems, what caused the problems and then talk about why you are probably reading this… you want working capital solutions.

It’s of course great to have sales – and sales and profits are even better. In general when you have those you have the essence of a healthy business. But those are in effect what we could call paper transactions and it always comes back to 100 year old clich?s such as ‘ cash is king ‘ and ‘the sale isn’t made until you’re paid ‘.

Working Capital Finance - Your Problem - Our Solutions for Solving Cash Flow Challenges

That cash is required for all those mundane things, paying suppliers, paying employees, and meeting your obligations on loans and leases.

Your challenge is typical, how you do create a flow of cash in the long term, as well as addressing short term bulges to ensure you have liquidity.

Of course when you have a good handle on cash flow, everyone looks at you with a positive outlook, the most important is your supplier and lender.

Solutions to cash flow challenges often arise from the inability to plan or overcome the right type of cash flow solution. You run the risk of liquidity problems when your current assets cannot be converted in a timely manner to cash – these assets are usually in the form of receivables and inventories.

There is no day where we don’t find this type of textbook of working capital financial challenges – it’s as simple as requiring products to fulfill regular or new large orders, generating invoices, and then waiting 30, 60 or 90 days for payment. That’s the challenge of textbooks when we talk to clients asking for our help in solving cash flow problems.

So we’ve done a good enough job to tell you what your problems and challenges are – let’s discuss some real-world solutions.

The essence of working capital financial challenges is that you cannot access business credit. We encourage all customers to seek Canadian bank business loans that are hired when they are in a position to do so. Unfortunately many clients cannot meet the net value of the business, the value of personal wealth, and the liquidity ratios and agreements that your bank might need. We also strongly believe that financing inventory by banks in Canada is increasingly difficult to achieve.

Don’t borrow – cash it. That’s the best advice and plan that we established with clients to solve cash flow problems. You can get a working capital cash flow term loan, but that only creates additional debt on your balance sheet. Instead, take the assets that you already have in your book and cash them out – those assets are the … Read More

Making Dough, Splashing Spondulicks and Wasting Wonga

With the exception of sex, drink and food there are more slang words for money in the English language than for any other thing.

Perhaps due to being the UK’s financial centre since commerce began, most of the slang terms for money originated in London.

In the old East End of London, cockney rhyming slang produced some of the most creative terms and phrases for money. Bees (bees and honey), lolly, readies, folding, wonga and hundreds more terms have emerged from Bow to Wapping and Bethnal Green to Whitechapel over the centuries.

The popularity of different terms comes and goes, new variations crop up and older ones are revived with bewildering regularity.

Back in the 1970s you could ask someone to lend you “a lady” without out it being construed as an illicit request. In the decade that gave us glam rock and punk rock “a lady” meant 5 (Lady Godiva – fiver).

For cockneys and mockneys in the 1990s, if something cost “a bag” it was 1000 (bag of sand – grand). More recently, in gambling circles, “a biscuit” has come to mean 1000. This is not exactly rhyming slang, it’s referring to the size of larger casino chips – which look like biscuits.

Borrowing a pony to boost your macaroni

To confuse things further, over time, slang terms for money begin to refer to other slang terms rather than to an actual thing. In the last 5 years it has become popular to use “macaroni” to mean 25. There is no direct connection between “macaroni” and 25, but it does rhyme with pony…

“A pony” has been used to mean 25 since the 18th century and is still popular today. However, theories about the origins of its use are hotly contested.

Some say 25 was the price of a small horse in the 1700s, others argue it’s because there was a picture of a horse on an Indian 25 rupee note at the time. There are even those that trace it back to biblical stories – far too convoluted to go into here.

Whatever the origin, it keeps on changing and maybe one day in the future etymologists will be arguing over why people in early 21st century used “macaroni” to mean 25 – I’m going to get my theory in early and say, given the current rate of inflation, it was the price of a packet of pasta in 2012.

Wonga, wadge and moola

Immigration and travel has had an impact on the words we use for money. Yiddish speaking immigrants from Russia and Germany in the late 1900s and early 20 century had a huge impact on the English language.

It was common to hear many Londoners refer to their money as shekels right up until the early 1960s.

Moola/moolah is as popular today as it was in the 1930s. “Moola” comes from the word matzah, a type of bread. Dough and bread have been used as terms for money for many years.

Wonga … Read More

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