LOCAL AND FOREIGN FUNDING GUIDE AND REQUIREMENTS

LOAN AMOUNT COVERAGE:

US$ 10 Million (Locally Funded)
US$ 100 Million (Foreign Direct Investment/ FDI)

PROPONENT CAPITAL EQUITY: Twenty (20%) Percent.

The Capital Equity requirement is a submission of a Bank Certification stating that the proponent has cash in the bank equal to or more than 20% of the project cost or capitalization, which includes CapEx and OpEx. The project will be funded ONE HUNDRED (100%) percent.

PROJECT FUNDED:

RENEWABLE ENERGY, AGRO-INDUSTRIAL, AND COOPERATIVE DEVELOPMENT PROJECTS

Vital/Preferred Projects such as RENEWABLE ENERGY/Waste to Energy (WtE), Hydro-Kinetic, Geothermal, Solar Energy, and Biomass sources. It must be PPP scheme, under the Government/Local Government Unit/ LGU / Local Council-Partnership.

Vital/Eco-sustainable projects, such as Agriculture, Cottage Industries in Cooperative setting, Industrial Development for raw material production, i.e: rubber, plastics, stone, metal, and glass

Research, Product Development, Innovative AI and Blockchain technologies. AI enables machines to make decisions and support humans, while blockchain provides a secure and transparent distributed ledger.

INITIAL SUBMISSION OF DOCUMENTS FOR FUNDING CONSIDERATION

  1. LETTER OF INTENT - (Refer to development guidelines further below)

    Attn: Engr. RINOCEN L. CANOY
    General Manager/Loan Arranger, OAC

  2. EXECUTIVE SUMMARY

  3. BUSINESS PLAN

    4. Note: For details refer to development guidelines indicated below


  4. FINANCIAL PROJECTIONS

    (In Local Currency and in US Dollars equivalent to be submitted on a separate sheet/file presentation).

    Local Currency (on a separate file)

    4.1 - Projected Project Cost Summary (Local Currency & USD)
    4.2 - Balance Sheet
    4.3 - Cash Flow
    4.4 - Income Statement
    4.5 - Payback Period Revenue
    4.6 - Revenue

    USD Currency (on a separate file)

    4.7 - Balance Sheet
    4.8 - Cash Flow
    4.9 - Income Statement
    4.10 - Payback Period Revenue
    4.11 - Revenue

  5. EPCC PROJECT IMPLEMENTATION
      6. 5.1 - GANTT Chart – EPCC Project Schedule Implementation.
      5.2 - Gantt Charts should show the amount of work done or work percentage to be completed in a certain period of time in relation to the amount planned for the project. It shall also show monthly target progress and equivalent cost monthly, and the total cost for every three months for budget disbursement.

  6. LOCAL GOVERNMENT UNIT/ LGUs/ Local Council PERMIT to OPERATE and CERTIFICATIONS - (signed by relevant Government Unit, and Local Council)
      7. 6.1. - Certification of Award
      6.2 - Notice to Proceed
      6.3 - Government/ Local Council Certification
      6.4 - Certification of No Objection

    Note: The format of the above -documents will be provided upon request of the Proponent

  7. INTEREST RATE on LOAN
      8. 7.1 - For Renewable Energy – FIVE (5%) Percent Annually Such as Waste to Energy (WtE), Hydro-Kinetic, Geothermal, Solar Energy, and Biomass sources.
      7.2 - For mixed-Used Development - Six (6%) Percent Annually

  8. PROFESSIONAL FEES (PF)

    9. 8.1 - The Professional Fee (PF) will be charged after the Proponent obtains the Loan.
    8.1.1 - The provision & review of document PPP-BOO or BOT JVA Contracts, funding application, process & approval.
    8.1.2 - The actual PF is Five (5%) Percent against the approved loan
    8.1.3 - Both sides of the deal are covered by the PF, intermediaries, processing fees, legal services and even taxes are within that PF.

    8.2 - Professional Service Fee that is charged before the loan.
    8.2.1 - PF is for the services like the review of documents, Feasibility Study (FS), Financial Review (FR), and Technical Study, such as data acquisition to obtain project-sensitive information to support the feasibility. Assistance in permitting stages, technology sourcing, review, and qualification processes.
    8.2.2 - Government certifications etc., and holistic assistance in completing the requirements of the Investment Fund,
    8.2.3 - The only other Fee charges are for the preparation of financial documents of the company that form part of the Proponent Fees are collected for an agreed professional services provided before the loan. Fees can be as low as USD 800 or as high as USD 2,000 depending on the scope of works involved, time-spent. Other services are on a case-to-case basis.

    NOTE: The above Professional Service Fee (8.2) may not be applicable if the Proponent has completed the required document with minimal changes/ corrections.

EXECUTIVE SUMMARY & BUSINESS PLAN CONTENT

  1. Overview: The Executive Summary and Business Plan together form one document. However, the Executive Summary should also be available as a stand-alone document, to be presented to the potential lender, who may then ask to see the full Business Plan.

    2. These notes are just for the help of those needing guidance on the content. Each business and project will be different, and the document must be tailored according to the particular situation. Every letter and figure must be readily legible (at least 11pt.). The document should initially be submitted in Microsoft Word, to allow for small amendments to be made easily. Executive Summary must not exceed 5 pages, while the Business Plan must not exceed 10 pages.

  2. Essential Requirements: All documentation must be in clear English, all amounts must be stated in millions and currency in US $ only - not unless stated / requested in local currency as well, quoting the exchange rate used for conversion from local currency. Local terms, technical terminology, and acronyms must be explained – the investor must easily understand what is being proposed.

  3. The Excutive Summary: This is a brief Summary of the Plan, in order (a) to provide investors with a “snapshot” of the Company, and an outline of the project, and (b) most importantly, to attract their interest in reading the full Business Plan. (This is the 3-4 pages of Executive Summary)

    4. It will therefore contain the following summarized information:

    • The Company - its Management, and financial results for the past 3 years.
    • The Project – background, market, and summary.
    • Implementation of the Project and the timescale
    • Project Cost. Capital Contribution by the Company/Promoters and Collateral Offered.
    • Funding requirement - amount, modus, and proposed terms thereo
    • Financial projections for 5 years – Gross Revenues, EBITDA (earnings before Interest, tax, depreciation, and amortization), net Profit , Cash flow, balance sheets, and ROI (Return on Investment).

    The Executive Summary should be constructed under the above- named headings, and should normally be contained in 5 pages A-4 sized bond paper. The initial impact of this Executive Summary is vital in securing funder’s interest in any project!

  4. The Business Plan will be divided into 3 sections, viz.

    5. (a) The Executive Summary: per item 3 stated-above, for a quick overview of the Project, together with the below Business Plan.

    (b) The Business Plan which will contain the following detailed information, adapted to suit the particular circumstances, and referenced where appropriate to the Appendices in (c) below:

    Background to the Project including socio-economic, national/international factor

    • The Proposal - brief description of the Project, aims, objectives, and justification.

    • The Company - brief history, operations, markets, products, last 3 years’ financials - Cash Flows, Profitability, Balance Sheets and key ratios.

    • The Products - including trademark/copyright/patent/licensing and other arrangements; the products’ cutting edge over competing ones.

    • The Markets - including Market Growth, Competition, and Marketing Strategy to achieve market shares and sales.

    • Production - availability of materials and labor, and security of the same. Land & Buildings required. Technology & Equipment, including providers of both. Operational details.

    • Sales & Distribution Arrangements - including the sales force, warehousing, and transportation.

    • Administration and related facilities - including IT and staffing.

    • The Management Team - the function of each member and an organization chart.

    • Research & Development - effort required to maintain competitiveness and profitability.

    • List of Official Approvals and Licenses required for the project.

    • Implementation of the project and the Timetable.

    • The Project Cost – is broken down under the different heads of Capital Expenditure, (Land & Civil Works, Buildings, Furniture, Fixtures & Fittings, Plant & Equipment, Vehicles, Technology/know-how, Goodwill), Preliminary & Pre-operative expenses, Working Capital, Interest during Construction, and Contingencies.

    • Promoters’ Capital Contribution - towards the project cost - amount and percentage and Collateral offered.

    • Funding Requirement & Modus - e.g. loan - details of term, grace period, proposed repayments and security, or equity investment–proposed shareholding, dividends, exit, exit premium.

    • Any Government incentives/support for the project.

    • Financial Projections - 10 years’ cash flow forecast (template available on request), profitability (EBITDA, Pre-tax and after-tax profit) balance sheets and key ratios.

    • SWOT Analysis: Analysis of Strengths, Weaknesses, and Opportunities of, and Threats to, the Project.

    • Sensitivity Analysis: Analysis of the impact on the Project when major adverse/critical factors come into play, and what steps will be taken to mitigate this impact.

    (c) Appendices - all supporting documentation such as:

    • A statement of any assumptions made, quoting independent evidence/sources to support them.

    • Map and drawings of the site and plant layout.

    • Attorney’s confirmation of title to the land and building permissions.

    • Leaflets on the technology and the plant/equipment.

    • Supplier quotations/contracts.

    • Marketing, sales, and distribution agreements.

    • CV’s of the management team.

    • Copies of official approvals/licenses.

    • Evidence of Government incentives/support.

    • Any research/press publications supporting the project or its kind.

    D. LOI Content

    1. Letter of Intent (LOI) - is one independent document that is a brief document submitted to a Funder to express your interest in applying for a specific grant opportunity. Funder via OPHIR services require this document to gauge potential. applicants proposed projects and general scope fund requirements. However this document is also normally to be read with the Executive Summary by Funder.

    2. LOI Guidelines to consider as follows

      • Names, and Contact Data of parties involved.

      • Description of the transaction

      • Proposed terms of the transaction

      • Completion timeline

    3. Details of LOI contents;
      • LOI shall be done under Proponent Company letterhead complete with address & contact nos.

      • Date of the LOI

      • Heading: LETTER OF INTENT

      • Sender Name & position in the company, email add.

      • Receiver Name: RINOCEN L. CANOY ChE /GM OPHIR

      • Company: OPHIR and Associate Consultants Inc.

      • Company Address: 2/F Sanvil Bldg. 2058 Laon Laan St. Sampaloc, Manila, Philippines 1008

      • Subject: LETTER OF INTENT -for PROJECT FUNDING

      • Proponent Company introduction - 1 paragraph

      • Project: Name of the proposed project

      • State the Proponent project in 1-2 paragraphs.

      • Highlight uniqueness & advanced features in technology.

      • Funding requirement- CapEx & OpEx, stated in local currency & USD., i.e. The estimated project cost - local currency xxxxxx (USD xxxxx) CapEx & OpEx.

      • State projected Income, Profit and ROI.

      • Loan/Investment Repayment Plan, i.e. The project Loan/ Investment -repayment for principal & interest will depend if the Proponent’s request are acceptable, reasonable, and doable terms of the project.

      • Proponent to highlight the viability of the proposed project

      • Proponent to state that Local Government has “No Objection” for the project.

      • Senders complete name, position & signature above the name.

        • Note to Proponent: The preparation of LOI shall be 2 pages maximum.

    A list of appendices should be listed in to the business plan, but the appendices themselves should be submitted as a separate document, file attachment, to be forwarded to the investor when requested. This keeps the Business Plan to a manageable size.