CASH COLLATERAL FOR YOUR LOAN, The 114% LENDING PROGRAM
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We are very
proud to
introduce this 114% Lending Program. Having spent many years developing
and improving it, we now have the perfect project financing
program.
The general overview of this 2-loan-program's procedure is as follows
(this is just an overview and it is not prepared for "Bank
Presentation", see our ""
message below): |
- Cash is wired into a financial
institution. All funds are brought into the depository escrow via the
international
banking wire system i.e. S.W.I.F.T being Legal, Clean and Cleared
funds (bank to bank).
- This cash is used to purchase a Specially
Structured 10 year CD, or any other available Bank Note with an annual
coupon rate of 7.2%
- Loan 1 is created in the amount of 100%
of the cd purchase at an annual interest rate of 5.4%
- Loan 2 is created in the amount of 14% of
the cd purchase at an annual interest rate of 5.4% (total loan of 114%
of CD purchase)
- Cash Provider immediately receives 50% of
loan 1 proceeds
- Bank immediately receives 10 years of
prepaid interest of loan one,
proceeds coming from the balance of loan 1, and the remaining amount
from loan 2. This has the effect of exhausting loan one proceeds, and
leaving a balance still available out of loan 2 for the company's use.
- The Bank pays to Provider 52% (which
equates to a partial payment of
5.2% interest, over 10 years, of the cd - in this scenario, that would
leave 2% of the cd coupon payment, over 10 years, still to be paid) of
total cd value out of the 10 year of prepaid interest that Bank
receives. Using these percentages, bank net cash position at time zero
is 2% of initial CD amount. Loan 1 interest is satisfied, and principle
of loan 1 is secured by CD at time 0. At time 0, what remains is loan
2, which is secured over time by the by balance owed by the bank of the
2% annual interest coupon, of the cd amount, for 10 years.
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ILLUSTRATION
(Hypothetical
scenario)
|
Initial
Transaction Amount |
|
$ 100,000,000 |
|
|
|
|
|
|
|
|
Loan 1 |
Loan 2 |
Provider |
Bank |
|
Incoming
wire from domestic brokerage firm,
funds confirmed prior to transaction |
|
|
|
|
$ 100,000,000 |
|
|
Purchase
10 year CD at |
7.20% |
|
|
|
$
(100,000,000) |
$
100,000,000 |
|
Loan
114% of CD at |
5.40% |
|
$
100,000,000 |
$
14,000,000 |
|
(114,000,000) |
|
Provider
receives 50% of Deposit from Loan 1 |
|
|
$
(50,000,000) |
$
- |
$ 50,000,000 |
|
|
Bank
receives 10 years prepaid loan interest on Loan 1 as follows @ time zero |
|
|
$
(50,000,000) |
$
(4,000,000) |
|
$ 54,000,000 |
|
Bank
prepays provider 10 years of cd interest at time zero at an interest
rate of |
5.20% |
|
|
|
$ 52,000,000 |
$
(52,000,000) |
|
|
|
|
|
|
|
|
|
Provider
has received 102% of initial depoeit |
|
|
|
|
$ 102,000,000 |
|
|
Loan
1 proceeds exhausted |
|
|
$
- |
|
|
|
|
Loan
2 proceeds reduced to |
|
|
|
$
10,000,000 |
|
|
|
CD
interest rate to be paid |
2.00% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Banks
position after initial transaction |
|
|
|
|
|
|
|
Bank has issued loan 1 |
|
|
|
|
|
|
$ 100,000,000 |
Bank
has issued loan 2 unsecured |
|
|
|
|
|
|
$ 14,000,000 |
Bank
is assigned cd which satisfies loan 1 |
|
|
|
|
|
$ 100,000,000 |
|
Bank
receives prepaid interest on loan 1 |
|
|
|
|
|
$ 54,000,000 |
|
Bank
has prepaid 5.2% (of the 7.2% interest on cd) at time 0 |
|
|
|
|
|
$
(52,000,000) |
|
Bank
net cash position at time 0 |
|
|
|
|
|
$ 2,000,000 |
|
Bank
Profit based upon present value of income stream discounted |
|
|
|
|
|
|
CD |
using
a
discount rate equal to cd interest rate |
7.20% |
$3,054,651 |
|
|
|
|
Interest of |
|
|
|
|
|
|
|
of |
|
|
|
Loan 2
|
Loan 2 |
|
Loan 2 |
2.00% |
|
|
|
Accrued
|
Principle |
Loan 2 |
Total
|
Assigned
|
|
|
YEAR
|
Interest |
Payment |
Balance |
Payment Due |
to Bank |
Loan 2
is satisfied by the income stream of
the balance of the 2% interest on cd |
|
0 |
|
|
$ 14,000,000 |
|
|
|
|
1 |
$756,000 |
$1,092,450 |
$12,907,550
|
($1,848,450) |
$ 2,000,000 |
2 |
$697,008 |
$1,151,442 |
$11,756,107
|
($1,848,450) |
$ 2,000,000 |
3 |
$634,830 |
$1,213,620 |
$10,542,487
|
($1,848,450) |
$ 2,000,000 |
4 |
$569,294 |
$1,279,156 |
$9,263,331 |
($1,848,450) |
$ 2,000,000 |
5 |
$500,220 |
$1,348,230 |
$7,915,101 |
($1,848,450) |
$ 2,000,000 |
6 |
$427,415 |
$1,421,035 |
$6,494,066
|
($1,848,450) |
$ 2,000,000 |
7 |
$350,680 |
$1,497,771 |
$4,996,295
|
($1,848,450) |
$ 2,000,000 |
8 |
$269,800 |
$1,578,650 |
$3,417,645
|
($1,848,450) |
$ 2,000,000 |
9 |
$184,553 |
$1,663,897 |
$1,753,748
|
($1,848,450) |
$ 2,000,000 |
10 |
$94,702 |
$1,753,748 |
$0 |
($1,848,450) |
$ 2,000,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Differnential |
|
|
Present |
|
|
of cd |
Bank |
|
Value
of |
|
|
interest |
Net |
|
Income
Stream |
|
|
assignment |
Cash |
Total |
Discount
rate |
|
|
vs loan |
position |
Bank |
of |
Present |
|
payment
due |
at
time 0 |
receipt |
7.20% |
Value |
0 |
|
$ 2,000,000 |
$ 2,000,000 |
$2,000,000 |
$3,054,651 |
1 |
$151,550
|
|
$
151,550 |
$141,371 |
|
2 |
$151,550
|
|
$
151,550 |
$131,876 |
|
3 |
$151,550
|
|
$
151,550 |
$123,019 |
|
4 |
$151,550
|
|
$
151,550 |
$114,756 |
|
5 |
$151,550
|
|
$
151,550 |
$107,049 |
|
6 |
$151,550
|
|
$
151,550 |
$99,859 |
|
7 |
$151,550
|
|
$
151,550 |
$93,152 |
|
8 |
$151,550
|
|
$
151,550 |
$86,895 |
|
9 |
$151,550
|
|
$
151,550 |
$81,059 |
|
10 |
$151,550
|
|
$
151,550 |
$75,615 |
|
|
|
|
|
|
|
|
|
|
$ 3,515,498
|
|
|
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To The Project:
- Fast Closing. Normally the negotiations
between the bank and The Fund
Provider
to reach the comfort level of the bank, by modifying some of the terms
and/or the final figures, take 2-3 days and the closing is achieved on
the 4th day.
- You will not have to service your
debt.
You will not have to pay back
the
principal or the interest on your loan, ever.
- Your project will be debt free.
- You will have full control of your loan.
To The Lending Bank
As per illustrated example above:
- They get the interest on the US$100MM
loan paid all upfront at
closing, a total of $54MM.
- Than Bank makes an instant $2MM.
- They make 2 loans, fully collateralized,
without any risk
whatsoever : The US$100MM loan is collatealrized with cash,
and the US$14MM loan
is collateralized with their own paper. There is just no better
security offered to a bank than this.
- They have the use of the US$100MM that we
deposit for 10 years to do
with it as they wish.
- They are securing the payment of the
US$14MM loan (principal and
interest) from the proceeds of their own paper.
- They are in an absolute “NO LOSE”
position.
- They are adding the US$100MM to their
investment portfolio.
- They do not have to rely on the success
of the project to service
the debt.
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1) Present your project’s
Executive Summary or Business
Plan to your bank or a bank of your choice.
2) Ask the banker to
review it and see if a loan
can be arranged for your project.
3) If the bank rejects
your loan application for
whatever reason, ask the banker the following question or
similar:
“Would you
consider arranging the loan for
my project if I provide
100% CASH collateral to the bank for this transaction?”.
4) If the banker
indicates that he would be interested,
advise the banker that a presentation will be provided to him, for his
consideration.
5) We will prepare you to
explain this program in detail and perform your own presentaion to
the
banker with facts, figures and mechanism.
6) Following step "5"
above, you may explain to the banker the program or have us make the
presentation to your banker.
7) Following our personal
presentation and during
that meeting, the closing of your loan should take place. The Fund
Provider’s
clean and clear funds will be wire-transferred from his major
bank to
your
bank and from your bank to your project.
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Consultation Fee of
US$2,500
When
you decide to continue with our program, this fee will be payable
together with the signing of our "Client Agreement".
This fee will include the processing of your application, preparation
for a bank presentation, consultation and
communication costs.
Personal Presentation:
If
you decide to have us meet with your banker and make the presentation
and/or meet at your bank for the closing, you will be required to
invite our team of 2
or 3 at your own expense. Such expenses will include- but not
be
limited to- airfare, hotel, ground transportation and the group daily
retainer
fees.
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... ...
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Remember:
This
Is Generic &
Not Ready For Bank Presentation.
This
Is Presented
To You For Introduction Purposes Only.
attempt
or be tempted to present any of this information to your
bank.
Extraordinary
large figures
have a tendency to overwhelm most conservative bankers. If you try to
explain
the Presentation yourself before our preparation, you will succeed
and you will loose that bank as your potential lending bank. We ask you
to do steps 1 to 4 as explained in the “Procedure” above and to leave
the
rest to us.
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