Mezzanine (or Second Charge) debt funding program:
This program is designed for clients who have Senior Debt from Bank or PE firm as first charge and don’t have enough equity to start the project, therefore seeks to leverage equity funds to the necessary equity to start the project with the Senior Debt funding, usually the collateral is a personal guarantee and shareholders lien and second charge on the project.
Mezzanine debt is the middle or second layer after Senior debt. This type of capital is usually not secured by assets and is lent strictly based on a company’s ability to repay the debt from free cash flow. It is usually a great way for growing businesses to bridge the gap between what conventional banks will lend against assets and the total value of a new project or acquisition.
Max LTV is 50% of the riming balance to Senior debt, riming balance of the funding, the interest 8% – 12%.
The following documents need to be submitted for review and due diligence.
- Application, Letter of intent/request (need to include, type of equity, Collateral, etc.)
- KYC/CIS includes a signatory copy of the passport. Corporate Board Resolution + Registration.
- Company profile.
- POF/Bank statement.
- An Executive summary of the project includes appraisal and feasibilities.
- Drawdown schedule / Milestones required.
Once the full package submitted, the R.M.G Capital Compliance to review, within about five business days, on green lite and decided to continue the process, the client accepts the Term Sheet with the offer of funding, the procedure, and schedules for performance.