July 4, 2019

QUESTIONS & ANSWERS

 

Frequently Asked Questions


Question (001) : Does Elite Capital & Co. offer any collateral?

Elite Capital & Co. does not provide any kind of collateral or bank instruments to clients.

 

Question (002) : What are the services offered by Elite Capital & Co.?

Elite Capital & Co.’s services are limited to providing project related services including Management, Consultancy and Funding, particularly for large infrastructure and commercial projects. Our company provides funding for projects where some type of collateral is available, e.g. Sovereign Guarantee, Bank Guarantees, Promissory Notes (endorsed by a bank), etc.

 

Question (003) : Does Elite Capital & Co. require any fees to consider lending applications?

Once the client has submitted a full set of application documents, and information relating to the underlying project, Elite Capital & Co. Limited will make a detailed assessment of the file. Elite Capital does not normally charge any fee for the initial project assessment, particularly when the application is made by the Project owner (NB. We sometimes charge an assessment fee when projects are submitted by intermediaries). If the client decides to move forward with Elite Capital to the contract stage, Elite Capital requires an Performance Bond/Insurance to be placed (see below – Questions from 011 to 014).

 

Question (004) : What is the acceptable collateral by Elite Capital & Co.?

Sovereign Guarantee, or a Bank Guarantee (from a bank rated “BBB” or better by S&P or Moody’s), or a Government Purchase Agreement “confirmed by the Ministry of Finance” of some description (e.g. Power Purchase Agreement).

 

Question (005) : What is the funding value from Elite Capital & Co.?

For Sovereign projects, we can provide up to 85% funding, and for private projects up to 80% funding. Therefore, the project owner must have the 15% or 20% equity for the project in the form of liquid cash/assets. (NB. We cannot accept Land, Buildings, in-ground assets, etc as equity).

 

Question (006) : Is the required amount from the client, which is equivalent to 15% or 20% will be paid to Elite Capital & Co.?

The 15% or 20% from the client side is paid directly for project costs, and not to Elite Capital & Co. or any third party. The payment will be made in line with the cash flow requirements for the project, which is typically broken down into Design and Construction milestones.

 

Question (007) : How can we ensure that Elite Capital & Co. will provide funding after we provide them with the collateral or guarantee?

Elite Capital & Co. is proud to be one of the very rare companies in the financial market that allow the customer to verify the availability of the credit line after signing the final contract and before issuing the collateral/guarantee through a bank-to-bank SWIFT system.

 

Question (008) : What do we need to apply for funding?

The project must have the necessary approvals and/or permits, and must have a completed Feasibility Study.

 

Question (009) : Can Elite Capital & Co. help us to write a Feasibility Study?

Elite Capital & Co. can write Feasibility Study for the client at a cost.

 

Question (010) : Do we need to provide Performance Bond/Insurance to Elite Capital & Co. before signing the Contract or Term Sheet?

The client should take out a non-conditional Performance Bond/Insurance for the benefit of Elite Capital & Co., which insures any or all of ECC’s costs (Lawyers, Bankers, Accountants, the process of Blocking Funds in the bank for the amount of the contract, etc.) in case of non-performance by the Client.

Note: This procedure does not apply to governments that contract directly with Elite Capital & Co.

 

Question (011) : What Performance Bond/Insurance is required?

Unconditional and Payable Performance Bond/Insurance pays 1% to 2.5% of the funding total face value to Elite Capital & Co. if the customer fails to provide the collateral/guarantee within 15 to 30 days from the date of signing the Contract or Term Sheet.

 

Question (012) : What type of insurance company acceptable for Elite Capital & Co.?

Any Western European or North American “A” rated or better insurance company by S&P or Moody’s or accepted by Elite Capital & Co.

 

Question (013) : What if I don’t have an insurance company?

Elite Capital & Co. can introduce the client to an acceptable insurance company.

 

Question (014) : Do we need to pay the Performance Bond/Insurance to Elite Capital & Co. if they introduced us to the insurance company?

The fee of the Performance Bond/Insurance will be paid directly to the insurance company’s bank account “not to Elite Capital & Co. or any 3rd party”.

 

Question (015) : What is the type of finance Elite Capital & Co. provide?

Projects are executed on an EPC+F basis, which is Engineering, Procurement and Construction plus Finance.

 

Question (016) : Is Elite Capital & Co. limited to BT (Build and Transfer) system?

Subject to negotiations. We can execute BOO or BOT projects, but only with 15% to 20% equity from the Project Owner or from a third party (e.g. Hedge Fund, Private investor, etc).

 

Question (017) : Who will nominate the contractor?

The EPC Contractor will be nominated by Elite Capital & Co. and agreed with the client in advance. The contractors we use are all from the Top 100 Chinese or UK companies.

 

Question (018) : Can the client nominate their own contractor?

To qualify for funding, the project must have a minimum of 50% to maximum %100 Chinese/UK content, which would include the EPC Contractor, and Technology or Components. Therefore, the client can nominate their own contractor who will carry out up to 50% content of the project.

 

Question (019) : Do Elite Capital & Co. monetize collateral like Bank Guarantee, etc. if the project is not applicable for EPC+F system?

Elite Capital & Co. is able to monetize collateral but provided that it will be treated as a loan and not a discount.

 

Question (020) : What is the deference between loan or discount on the monetizing system?

Example of discount: Lender will discount 70% of the collateral face value and the borrower will return 100% of the face value at the maturity date.

Example of loan: Lender will lend 70% of the collateral face value and the borrower will return the same 70% (plus interest) at the maturity date. (Note: numbers mentioned are only for example).

 

Question (021) : What types of construction projects Elite Capital & Co. can fund?

The types of construction projects we can fund are; Rail, Energy Plant, Oil Refinery, Hotel, etc. What we can’t do is construction projects that have no technical content – roads, housing, etc.

 

Question (022) : Are all countries acceptable to work with?

The project cannot be in a sanctioned or unstable country.

 

Question (023) : Are customers from USA or UK acceptable to Elite Capital & Co.?

USA and UK citizens are acceptable to Elite Capital & Co., because we do not take money from them, but we offer them loans for their businesses and projects that contribute to supporting the economy in their countries.

 

Question (024) : Can we apply for funding if there are some missing papers?

Elite Capital & Co. is keen on quality standards and anti-money laundering. Therefore, you need to read “Money Laundering Prevention” section at the “Key Features” page before you apply.

 

Question (025) : Does Elite Capital take management fees from the client?

Elite Capital & Co. will take a one-time 3% management fee from the loan amount (not from the client) deducted from the loan proceeds at drawdown, or will take 5% from the project net profit only during the loan repayment period. Note: The choice between these options is made at the sole discretion of Elite Capital & Co.’s underwriting team.

 

Question (026) : Do Elite Capital & Co. offer commissions?

The rules around Anti Money Laundering and Anti Bribery are very strict, and thus Elite Capital & Co. does not to provide any commissions or gifts. In the case of introducer fees, the introducer must agree their fee in writing with the client, and this request must be explicit when the funding application is made. The introducer will be responsible for paying any/all taxes in their home jurisdiction.

 

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Elite Capital & Co. Limited

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