Background: A perennial problem for all of us as angel investors is the presence of moribund companies in our personal portfolio that are still on life-support (meaning the company has not officially shutdown but for all intensive purposes is dead) and as such, without documentation of dissolution we cannot declare the tax loss. As a solution and as a benefit for members, TCA is establishing a “Lost Causes Fund” (dubbed “Tech Coast Angels LCF Fund”) run by TCA wherein members can sell all shares in a company at the rate of $1 per holding, along with signed documentation that the member (seller) accepts this amount as a fair valuation. If a miracle occurs and there is a gain, then TCA (under the direction of the BOG) would donate any net proceeds for
charitable purposes to support entrepreneurship. The intent is to allow each member an opportunity to take legitimate tax write-offs when portfolio companies have not yet provided documentation supporting dissolution or bankruptcy.
How it works: Members interested in participating, would complete the following steps:
- Read the Securities Purchase Agreement , fill in the blanks, and sign the document
- Fill in the blanks on the LCF Transmittal Form below
- Mail the completed Securities Purchase Agreement and a copy of the security (stock certificate or convertible note) to Arash Sani, 1427 7th Street #514, Santa Monica, CA 90401.
In addition, email the documents to firstname.lastname@example.org
- Contact the company (via email or letter) asking for a transfer of ownership be made to “Tech Coast Angels LCF Fund”, and requesting that any future shareholder notifications be
Tech Coast Angels LCF Fund
Attn: Arash Sani
1427 7th Street #514
Santa Monica, CA 90401
If the company responds and requests the old certificates, please comply. Send copies of any correspondence with the Company to email@example.com, and if the company issues new certificates, send them to the address above.
- Member needs to be a current member (active or inactive) at the time stock is sold to fund
- Holding must be in a TCA Portfolio Company. The definition of a TCA Portfolio Company is one which presented to TCA and in which at least two members invested
- Shares sold to the Fund must constitute that member’s entire holding in that company (all types of securities)
Questions: If you have any questions, contact Arash Sani at firstname.lastname@example.org or John Harbison at email@example.com.
Tech Coast Angels
LCF Transmittal Form
Complete one transmittal form for each company, but on a company’s form you may list multiple securities in that company. The combination of all securities listed in each transmittal form and SPA for a given company will result in a combined transaction valued at $1 per company.
Description of security including type (e.g. common stock, preferred stock, convertible note, warrants), Series (e.g“Series B”) and amount (e.g. number of shares or face value of note). If tendering multiple securities for a company, list them all: