Program 7 – Non-recourse Loans for Projects or Growth Capital
| Type Of Loan: | Non-recourse, Project, Venture or Portfolio financing. Similar structure to a line of credit with disbursements, but not a revolving line — borrow then repay. Once repaid, further borrowing would require a new loan request. Also good for refinancings as well as project funding and growth capital. |
| Length Of Loan: | Flexible terms but standard is 10 years with 2-3 year grace period (up to 4 years as a construction loan for development projects) then converts into a longer-term stability option. Can be longer (up to 20 years) if project warrants it. |
| Prepayment Penalty: | None |
| Initial Costs: | No fees for an expression of interest or Letter of Intent. |
| Minimum: | $25 million minimum per loan; prefer $50mm-$1 billion |
| Interest Rate: | ~6-12% fixed annual interest (APR). Lower rates with a minimal profit share. All rates subject to change and based on quotation at the time of application. |
| Timing to Funding: Use of the Down Payment: | First disbursement around 90 days after closing and can be spread out over the course of 1-2 years. Borrower receives 100% of the loan amount (10x the 10% down payment, 5x with 20%, 4x the 25% down payment), not 90-75%. Funding is ordinarily delivered in 2 or more tranches, but if the borrower prefers lump sum distribution (full amount of loan proceeds in a single draw) this may be available at a slightly higher rate of interest — likely in the range of 9-15% APR. Down payment (10%-25%) can be used for prepaid interest, debt service reserve, or takeout of covenants. |
| To Qualify: | Project or venture finance transaction must have reasonably low risk; see comparison. Client needs to provide 10-25% down payment at closing and the lender will multiply that as the basis in debt funding. Below 25% would likely involve sale of some equity, perhaps using a “quasi-equity” The deposit sits and is released upon loan repayment in full, which can be either from operating cashflow or from subsequent refinancing. |
Program 7’s intake steps:
- NDNCA (available upon request); fee agreement
- Executive Summary – lengthy business plan or offering memorandum, presentation, etc. is fine but I also need a simple 1-pager that captures just the essential facts of what, where, how much, etc.
- Budget and Proforma in Excel
- Proof of Funds/Asset for the 10-25% (we need to be able to authenticate the value)
- Summary Application (specific to this lender, will provide the package of forms after screening)
- Preliminary “tranche” draw schedule (request form/template)
- Management/Sponsor bios
To start: Contact Us to see if you qualify, or to request 1-page Loan Program 7 Tear Sheet.
