Business Funding
Summary

We have a unique opportunity for businesses to raise funding through our lenders as long as they have the backing of their local bank. This works best with clients that have a long-term established relationship with their local bank. In essence, our lenders will lend the client money based on their local bank guaranteeing the loan. The local bank is required to endorse the lender’s Bills Of Exchange through their corresponding foreign bank, which can be the local banks’ branch in the UK/Europe.

Requirements

The business must be established and profitable with a strong balance sheet.

The business must have a strong transactional relationship with a local bank.

The business must own an asset, e.g. land, real estate, mines, licenses, governments agreements, etc.

The business must be able to borrow the money through a Bill of Exchange to be in the position to move the business to the next level; hence be in a position to pay the loan back.

Funding Process

Below indicate the costs involved for the Bill Of Exchange funding process. Please note the pricing is based on project and geographic risks so prices may be adjusted to reflect this:

Loan amount $5 – $50 million – Larger amounts can be considered on a case-to-case basis.

Term: 12, 24, 36, 48 months [interest paid annually]

  • The Loan can be refinanced at the end of the term as long as the bank guarantee still in place.
  • A further loan can be obtained by the same client later on using a second Bank Guarantee.

Interest Rate [estimate]: 5% – 6% dependent on risk & prevailing bank rates

Lender’ commitment fee $35,000

  • $17,500 – paid once the client gets the Initial Offer Letter. The Offer Letter means that the money for the loan has been assigned. The Offer Letter details summarily, the terms and conditions of the loan.
  • $17,500 – deducted from proceeds of the first drawdown. This can be deducted from the loan fee as well.

Lender Arrangement Fee of 3%. Lender deducts this from the loan amount before disbursement.

Loan Broker Success fee of 5%

The only fee that is paid in advance of funding is half of the commitment fee [$17,500], and it is only requested on receipt and acceptance of the Initial Offer Letter from the lenders. It is imperative that the project can show that it can pay the loan back within the requested term of the loan. The use of a local bank assures the lenders that they would have carried out their checks before endorsing the project.

Documentation Required

The Borrower must provide the following:

Executive Summary of the project for which funding is required

A comprehensive Business Plan

Total Cost of the project

Loan amount requested

Repayment period required by the Borrower

Full Corporate Name & Address of the Borrower

Full Name & Address of Borrower’s Bank [the bank that will endorse the Bills of Exchange].

Full Name & Address of the Bank’s corresponding Bank in Europe.

Requirements

Before engaging with our lenders, we initially request the name of borrowers’ local bank and their corresponding foreign bank that will endorse the Bill Of Exchange. This allows us to confirm that the bank is acceptable.

Once we confirm that the bank is acceptable, we request that the borrower confirms with their bank that they are in a position to endorse Bills of Exchange in their favour.

This will be in the form of a letter from the bank addressed to their client confirming that the bank will back the Bill of Exchange funding for the required loan amount.

On receipt of the bank letter, the borrowing company signs an Engagement letter with the loan broker.

Procedure

Based on the documentation provided above, the lender issues an Initial Offer Letter

Borrower to review and accept the Initial Offer Letter

A part-payment of the lender’s commitment fee is required

Upon acceptance of the above Initial Offer Letter by the borrower, the lender shall issue a Terms Sheet for funding against a Bill of Exchange.

The Terms Sheet will include:

  • Full funding procedure
  • Terms and conditions of the Bill Of Exchange financing facility.

Upon acceptance of the Term Sheet by the Borrower, the lender shall issue the requisite Loan Agreement to the Borrower for review and execution.

After both parties execute the Loan Agreement, the lender will issue the Bill[s] of Exchange in the aggregated amount of the loan required plus interest; for formal acceptance by the Borrower and to be endorsed by the Borrower’s local Bank [the “Guarantor”].

Upon receipt of the duly accepted Bills of Exchange, the lender shall remit the required loan amount to the Borrower through the corresponding foreign bank, then to the local bank before disbursement to the borrower.

The Borrower shall then utilise the funds to implement into the project.

The borrower shall pay annual interest to the lender

On maturity of the Bill of Exchange as per the agreed tenor, the lender will submit the Bill of Exchange for payment by the Borrower’s bank [the “Guarantor”].

The Borrower shall pay the lender, the full face value of the Bill[s] of Exchange being the loan principal.

Payment of loan will be the same currency as the original loan

Subject to the agreed terms of funding, the Borrower can exercise the option to roll over the loan by making the agreed interest payment to the lender.

Time Frame Until Completion

Depending on the cooperation and execution of all parties involved, a Bill Of Exchange funding and therefore drawdown of the funds can be accomplished within 4 to 8 weeks.

However, this can only be an indication and does not reflect the time required for specific projects.