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cosmoray Bella Vista Holdings Corp	Posted - 2010.07.01 13:03:00 - [1] Edited by: cosmoray on 01/07/2010 13:16:22 TLDR Bond = 30 - 70B ISK Rate = 3.5%, paid monthly Period of Loan = Dependant on loan, minimum 3 months Some Collateral Loackdown Background/Proposal For those of you that don't know I have successfully run an IPO/Bond for more than 2 years. Currently all my activities revolve around my loan business mainly built up from contacts I made from my very large production business, including alliance level. I have a current net worth about 170B ISK, of which 155B is in cash the rest in assets. I also have a 40B bond running, which gives about 195B ISK available for loans. I currently have 183B ISK loaned out to 8 customers all fully backed with collateral. The problem I have is that there are several potential deals available for expanding the loan book but no available cash. Due to my cash situation I am looking at running a large bond, but the exact amount isn't finalized yet. It will be in the range of 30 - 70B ISK depending if the loans hit. The rate is 3.5%, and is realistically all I can afford as the loans pay me about 4.5-5.0% if the size of loan is large. My profit is the difference in rates. Here is a breakdown of my current LOAN BOOK I hope this provides some insight into the business. Collateral All my loans require collateral (minimum 105%, negotiable) and in this bond I would place SOME of the collateral into a holding corp for lockdown. The corp also has VV as a director with 50% of the shares. Votes are required or lock/unlock,. This number can be expanded if neccesary. In some of my loans I set up a holding corp in high sec, so the borrower can have access to their BPO's and utilize them. For one of the new loans this would be the case so lock down in my holding corp is not possible. Reservations I am currently looking for some level of reservations on this bond, upto about 70B. If this bond launches it will be next week and will need to exchange finances fast. Reservations will be on a first come first serve basis, and will fill to the amount of loans that are gained. Cancellation If I do not get the loans the bond will not be launched. If you are interested in staying on a semi-reservation list for the future, you can also state that. Discussion/Questions I am available for about an hour or so today after the post. After this time I will only be on periodically over the holiday weekend so please don't think I am not answering your questions.
Kapila Parthalan	Posted - 2010.07.01 13:13:00 - [2] Your loan book link is inaccessible as the google doc is apparently private.
cosmoray Bella Vista Holdings Corp	Posted - 2010.07.01 13:15:00 - [3] Originally by: Kapila Parthalan Your loan book link is inaccessible as the google doc is apparently private. Changed settings, let me know if it works
RAW23	Posted - 2010.07.01 13:20:00 - [4] Any idea of possible collateral percentage? I understand that it will probably be dependent on the final bond size but could you give a ball-park figure for eaither end of the scale?
cosmoray Bella Vista Holdings Corp	Posted - 2010.07.01 13:28:00 - [5] Originally by: RAW23 Any idea of possible collateral percentage? I understand that it will probably be dependent on the final bond size but could you give a ball-park figure for eaither end of the scale? There are four possible loans (public indicates that loackdown is in my holding corp with VV as discussed, more directors can be added): 1. 17B - Collateral in high sec in client system, lockdown in private holding corp so customer has access. Not public 2. 14B - 10-12B public collateral, 3-5 semi-private 3. I may bid on AC155 for thew full amount and that would be fully public collateral 4. 26B - currently bidding and would be fully public collateral I don't expect all to fly.
Kapila Parthalan	Posted - 2010.07.01 13:32:00 - [6] Originally by: cosmoray Originally by: Kapila Parthalan Your loan book link is inaccessible as the google doc is apparently private. Changed settings, let me know if it works Yes, it works now.
RAW23	Posted - 2010.07.01 13:40:00 - [7] Edited by: RAW23 on 01/07/2010 13:44:22 Edited by: RAW23 on 01/07/2010 13:41:41 Originally by: cosmoray Originally by: RAW23 Any idea of possible collateral percentage? I understand that it will probably be dependent on the final bond size but could you give a ball-park figure for eaither end of the scale? There are four possible loans (public indicates that loackdown is in my holding corp with VV as discussed, more directors can be added): 1. 17B - Collateral in high sec in client system, lockdown in private holding corp so customer has access. Not public 2. 14B - 10-12B public collateral, 3-5 semi-private 3. I may bid on AC155 for thew full amount and that would be fully public collateral 4. 26B - currently bidding and would be fully public collateral I don't expect all to fly. Sorry - I meant the collateral on your bond, not on the loans. Or do you intend to use the loan collateral as the bond collateral? If so, I can see that being a bit problematic in the sense of transferring the money to the borrowers without the bond being uncollateralised for some period of time (i.e. who would hold the bond money before the collateral arrives?). Edit - Ok, looking again at the OP I see what you intend to do. But that would pretty much make the bond itself entirely uncollateralised wouldn't it? From the pov of an investor assessing risk, if you hold the full amount of cash before you lock down any collateral with VV, then the risk of you running with the cash is unmitigated by the lockdown.
Varo Jan Caravanserai Consulting	Posted - 2010.07.01 13:47:00 - [8] Originally by: cosmoray I have a current net worth about 170B ISK, of which 155B is in cash the rest in assets. The problem I have is that there are several potential deals available for expanding the loan book but no available cash. Those two statements don't gel. If you have 155B in cash, why not use it instead of taking out a bond? No offense intended, but has your net worth claim been substantiated by an independent party? Quote: All my loans require collateral (minimum 105%, negotiable) and in this bond I would place SOME of the collateral into a holding corp for lockdown. The corp also has VV as a director with 50% of the shares. Votes are required or lock/unlock,. This number can be expanded if neccesary. It would be prudent to have more trustees. Quote: In some of my loans I set up a holding corp in high sec, so the borrower can have access to their BPO's and utilize them. For one of the new loans this would be the case so lock down in my holding corp is not possible. What's to prevent you having 3 trustees in this corp or a new corp specifically opened to allow borrowers access to their BPOs?
cosmoray Bella Vista Holdings Corp	Posted - 2010.07.01 13:51:00 - [9] There is always going to be a period of time when the bond is uncollateralized. After I recieve the cash I give it to a borrower in the form of a private exchange contract and they provide me the assets. It would be these assets that would be locked down, as I have done with VV before. I can't use assets from my other bonds as most are in use by the lender and I don't have permission to use them as assets for my personal bonds. There will always be some requirement of trust. I have an unsecured 40B bond and have run a business for 2 years. In this bond I am offering to lockdown the loan collateral to provide security, so I can't run off with it. Investors would have to decide if they trust me with the ISK for at least some of the time.
Fecilcia	Posted - 2010.07.01 13:51:00 - [10] I'll take a ticket, probably in the range of 5-10bil. Interested in the discussion of this offer. Fec
RAW23	Posted - 2010.07.01 13:54:00 - [11] Varo - I think the cash is all on loan. Cosmo - Another potential problem here: can you really use collateral other people lodge with you as collateral for your own bond? It is, after all, not your stuff. If you default and the collateral is sold off, and your loans are all over-collateralised, the liquidator will be in a very difficult position as they would have to sell assets that don't belong to you to cover your own debts and these assets would be greater in value than the amount owed to you be your borrowers. Taking such action would mean that the liquidator would effectively be stealing from your borrowers.
Varo Jan Caravanserai Consulting	Posted - 2010.07.01 13:58:00 - [12] Originally by: RAW23 Varo - I think the cash is all on loan. Cash means cash. :) It has to be in your wallet, available to you instantaneously.
RAW23	Posted - 2010.07.01 13:59:00 - [13] Edited by: RAW23 on 01/07/2010 14:01:13 Edited by: RAW23 on 01/07/2010 14:00:49 Originally by: cosmoray There is always going to be a period of time when the bond is uncollateralized. ... After I recieve the cash I give it to a borrower in the form of a private exchange contract and they provide me the assets. In this bond I am offering to lockdown the loan collateral to provide security, so I can't run off with it. Well, you will be able to run off with the cash as per your first line. Why not just go uncollateralised then, as a promise to provide collateral at a date sometime after you have received the investors' cash doesn't really provide any security at the moment of greatest danger (i.e. if this is an intentional scam), although it provides some against the possibility of burnout scam/hit by a bus scenario further down the road. Edit Am I reading this all wrong and the lockdown is for the benefit of your borrowers rather than those who lend you money through the bond?
cosmoray Bella Vista Holdings Corp	Posted - 2010.07.01 14:08:00 - [14] Edited by: cosmoray on 01/07/2010 14:09:52 Originally by: RAW23 Varo - I think the cash is all on loan. Cosmo - Another potential problem here: can you really use collateral other people lodge with you as collateral for your own bond? It is, after all, not your stuff. If you default and the collateral is sold off, and your loans are all over-collateralised, the liquidator will be in a very difficult position as they would have to sell assets that don't belong to you to cover your own debts and these assets would be greater in value than the amount owed to you be your borrowers. Taking such action would mean that the liquidator would effectively be stealing from your borrowers. Clear up a couple of points: 1. Cash of 155B. This is my liquid net worth, but it is what is used to provide loans along with the 40B unsecured Cosmo Bond to make 195B available for loans. Sorry if this wasn't clear. My actual cash position (in my wallet) is just over 6B ISK in Cosmoray, the other few Bill is being PVP'd. This is the need for funds to get the loans. 2. Conflict of collateral lockdown. If I collected bond money and transferred it to a borrower and then locked the collateral down within a holding corp and then disappeared. The Trustees at this point could negotiate the return of the collateral to the borrower for the loan amount. This would return the bond money to investors. For the period of where I receive the funds but haven't exchanged with a borrower, well that is the moment of trust, just like all other offerings. 3. Lockdown of assets. I can not make any changes to my current loans as I have agreements in place for how they work, althoug I got permission from lendees to post the loan sizes and collateral but keep other info private. For this bond I can only allow trustees to be added for NEW loans when the collateral will be locked down so bond holders can negotiate the return of ISK from lendees. Trustess would be given the details of the loans. Happy to add either 1 or 3 trustess to make 3 or 5 shareholders so a majority vote is required for lockdown/unlock. edit: Some of the lockdowns are for customer benefit so they can use the assets. Some are just held by me in exchange for loans. Sitting mostly at Jita. note: I hate the 5 minmute rule
RAW23	Posted - 2010.07.01 14:33:00 - [15] Originally by: cosmoray 2. Conflict of collateral lockdown. If I collected bond money and transferred it to a borrower and then locked the collateral down within a holding corp and then disappeared. The Trustees at this point could negotiate the return of the collateral to the borrower for the loan amount. This would return the bond money to investors. So the investors would have to wait for the loan to run its term before they were repaid? Will any of the loans be open-ended (or even just long term), as this could be an issue? Quote: For the period of where I receive the funds but haven't exchanged with a borrower, well that is the moment of trust, just like all other offerings. Not really. Normally, collateral is put in place exactly to avoid that moment of trust. I can see that locking down collateral at a later date ould provide some minor additional security to this but it would, in effect, be an uncollateralised loan for security assessment purposes if you ever have the oppoerunity to do a runner with the cash.
cosmoray Bella Vista Holdings Corp	Posted - 2010.07.01 14:54:00 - [16] I seem to have made this way more complicated than I intended. Was in rush to get it out before going away, should have thought better. Couple of Points: This is a bond that I am personally responsible for. I have tried to provide some additional security by making the collateral locked down by the public trustees so the bond holders can access the cash at the end of the loan if I have disappeared. There is always an element of trust in the offerings. Before Bad Bobby locked down the Titan BPO's he had to receive the cash, this is the type of position I am trying to re-create. If you trust me, then please make a reservation if you want to invest. If there are more questions I will answer over the weekend. I am going away so I can't reply further until at least Friday night/Saturday.
Legebriril24	Posted - 2010.07.01 15:15:00 - [17] I'l reserve 500mil please, willing to stay on semi-reservation list for the future as well.
Athias	Posted - 2010.07.01 15:36:00 - [18] I would like to reserve 2.5B maybe more later
Jackie Fisher Syrkos Technologies Joint Venture Conglomerate	Posted - 2010.07.01 15:45:00 - [19] A good old fashioned my word is my bond bond Put me down for 10 bil Cosmo.
Bashar Tyekanik Minmatar Zensunni Wanderers	Posted - 2010.07.01 16:18:00 - [20] Reserve 5B for me please.
Ambo I've Got Nothing	Posted - 2010.07.01 16:28:00 - [21] I'd take 20 billion. --------------------------------------
Aishwarya Rai Ta'aqiru Technologies	Posted - 2010.07.01 16:30:00 - [22] evemailed, full funds which are requested are available.
Onyth Had Investments	Posted - 2010.07.01 20:07:00 - [23] I'd like to reserve 2bil
Vaerah Vahrokha Minmatar Vahrokh Consulting	Posted - 2010.07.01 21:05:00 - [24] I am going in vacation in the last 2 weeks of July and possibly 1 in August, so please take this in consideration when planning about collateral lock down and whatever. - Auditing & consulting When looking for investors, please read http://tinyurl.com/n5ys4h + http://tinyurl.com/lrg4oz
Grendell Technologies Unlimited	Posted - 2010.07.01 21:14:00 - [25] If you need a trustee or 3rd party for anything let me know. Grendell ♥
Trayjan	Posted - 2010.07.01 21:55:00 - [26] i'd like to reserve 2.5B
Angry Glasses	Posted - 2010.07.02 00:43:00 - [27] Edited by: Angry Glasses on 02/07/2010 00:43:02 I'd like to reserve 700m
Rykker Bow Gallente Northstar Cabal R.A.G.E	Posted - 2010.07.02 00:53:00 - [28] I'll reserve 5b
Krythas	Posted - 2010.07.02 15:20:00 - [29] I'd like to reserve 2bn, thanks.
Xhalia Men On A Mission	Posted - 2010.07.03 13:24:00 - [30] I'll take a ticket for 0.5B ISK.

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