The Global Venture Capital Fund group provide fast, efficient and inexpensive access to equity capital. We have executed funding commitments for funding on many stock exchanges including Frankfurt, Australia and South Africa. We fund companies through the private purchase of their shares based on a small discount off a volume weighted average price formula.
Friday, November 11, 2011
Venture Capital Funding - Saeo.net
Global Venture Capital Fund understands the venture capital needs of companies in today's turbulent economic environment. With the global lock-down on bank loans, you need venture capital funding partner like us. If your company qualifies, you may be able to gain approval and commitment for venture capital funds within 48 hours, and actual funding within two to four weeks
About Us
http://www.globalventurecapitalfund.com/aboutus.html
The Global Venture Capital Fund group provide fast, efficient and inexpensive access to equity capital. We have executed funding commitments for funding on many stock exchanges including Frankfurt, Australia and South Africa. We fund companies through the private purchase of their shares based on a small discount off a volume weighted average price formula. Your company controls the timing and amount of each requested investment, usually based on fifteen trading day periods. Our funding agreements are not complicated and we can usually close within two weeks. We also provide pre-public funding commitments so that company's can then go public once the funding agreements are signed and committed by our fund.
In the last 12 months our funds have signed 22 funding commitments in 14 different countries to invest in non-controlling direct private equity investment into the following sectors: Banking, Energy, Media, Steel Mills, Flour, Sugar, Cement, Mining, Real Estate, Communications, Construction, Technology and Infrastructure.
The way the our funding strategy works for companies listed, or to be listed on the Frankfurt Stock Exchange, is that the company assigns shares of its common stock to a licensed attorney acting as escrow agent. Once the shares are in escrow, the company can then "draw down" on its equity credit line by sending a funding notice. The amount of funding for each request is based on a specified formula that the company and investor agree upon in advance.
We have come up with a proprietary method for companies to maximize the amount of funding they can draw down in a pricing period. It is a bilateral pricing structure that allows companies to draw down more funding than the typical funding structure used by hedge funds today, increasing the amount of funding beyond the limits used by most other funds based on the number of shares issued as the commitment fee.
Equity line venture capital; funding is being used by public companies across the globe to raise working capital, to make acquisitions or to pay down debt. The funding structure is based on a formula which is used to determine the amount of funding the company will receive at the end of the pricing period.
Most hedge funds restrict company's to 5 day pricing periods and Euro limits per pricing period which limits the risk to the hedge fund. The funding terms are based on a discount to the Volume Weighted Average Price (VWAP) as reported by an approved quote system. By utilizing a 10 to 15 day trading period as the pricing period, our companies are able to draw down more funding.
One of the main benefits of Equity Line Funding is that the company has complete control over the timing of draw downs on the funding. A number of terms and conditions are used to give the company additional control over the draws down. They include the following:
• agreed upon discounts based on closing bid prices of the company's common stock;
• the company chooses its floor price below which shares cannot be sold during the draw down period selected by the company;
• the company controls the amount requested in each draw down; and
• the company controls when the draw down notices are given (which can only be given by the company).
Raising capital through our fund is often preferred by companies over a convertible debenture for two primary reasons:
First, pursuant to the terms of an Equity Line Funding the company is in complete control as to when to request capital and sell shares of its common stock. More importantly, with an Equity Line Funding the company selects its own bottom, or floor price. In a convertible debenture financing, although capital is provided to a company up front, if there is no floor on the conversion price it becomes a toxic convertible also known as a death spiral. This form of funding can be highly dilutive since the debenture holder can keep converting into the company's common stock and selling into the market with no floor price to protect the company and that is why Equity Line Funding would be a preferred form of funding.
This downward selling pressure can hurt a company's stock price and the company may have very little if any control over the situation since it must honor the conversions. If the company halts the conversions by refusing to issue common stock to the investor, then the matter usually ends up in litigation. Courts tend to favor the debenture holder/investor in these situations unless the company can actually prove a breach of contract by the investor. For instance, the company would have to prove that the debenture holder/investor was shorting the company's common stock in violation of the debenture terms or securities regulations.
Secondly, most Equity Line Funding agreements contain a provision that allows the company to cancel in the middle of a funding draw down or not count certain trading days if the price of the common stock falls below an agreed upon "minimum acceptable price". This gives the company significant control over the funding process. It effectively allows the company to stop the funding temporarily, indefinitely or even permanently if its stock price is trading below the agreed upon minimum price. A good structure allows the company to name its minimum price for each time it request to draw down funding. Our team has drafted many of these clauses for corporate funding.
The "minimum acceptable price" can be any price or formula that the company and investor agree upon. It can be a fixed price or a moving price which is more common. For instance, the "Minimum acceptable price" can be defined as 80% of the volume weighted average price (VWAP) of the company's common stock for the fifteen (15) trading days prior to each draw down date. This way if the company's stock price starts dropping rapidly after the draw down is given, the company can cancel in the middle of the draw down period. By doing this, the company would only be responsible for issuing shares to the investor up to the cancellation date and the investor would be required to fund that amount through the cancellation date.
One of the best uses a company can make of an equity line funding is to make an acquisition. Whether it is an asset purchase or a corporate acquisition of a competitor, if it provides cash flow and increases net income it is usually a good move for the company. Of course, price terms must be favorable to the company so that it is not over paying for the acquisition. Some private companies are even using Equity Line Funding to get a pre-listing commitment in advance of a reverse merger or direct listing.
Simply using an Equity Line to pay down debt or for working capital is generally not a good idea unless it will have the effect of increasing the company's net income. Otherwise, it will simply dilute the company and the percentage of ownership interests of all its existing shareholders. Also, if the capital that is raised is not used effectively by the company, then it will have the effect of putting downward pressure on the stock price causing it to trade lower.
Although company's listed in the United States must first register the shares of common stock that will be used to draw down funding under the equity line, this is not required of companies listed on the Frankfurt Stock Exchange. Thus, it can be a useful funding tool for a company because if the Equity Line is structured properly, the company can use it to draw down capital over a period of two or even three years in most cases.
Hedge Funds have become good sources for companies looking for capital through an equity line funding. Companies both large and small have raised substantial sums through equity line funding vehicles. Our team has drafted many Equity Line agreements for hedge fund clients over the years and worked with Frankfurt Stock Exchange listing partners in order to secure the funding pre-IPO.
Venture Capital Funding
http://www.globalventurecapitalfund.com/venturecapitalfunding.html
Global Venture Capital Fund understands the venture capital needs of companies in today's turbulent economic environment. With the global lock-down on bank loans, you need venture capital funding partner like us. If your company qualifies, you may be able to gain approval and commitment for venture capital funds within 48 hours, and actual funding within two to four weeks. Our principals are able to conduct due diligence and act fast so that there is no long drawn-out waiting period. For private companies, you may be able to secure a signed pre-listing approval and commitment before your company is listed on a stock exchange, for a funding commitment that will become immediately available to you upon going public an approved stock exchange. In this manner, if your company is approved, your company can secure private venture capital funding as a signed commitment prior to incurring the expense of going public.
Simply click the following link, below, and complete our brief online application to find out if you qualify for a contractual venture capital commitment now. All information will remain strictly confidential. We look forward to working with you and to helping your company achieve the success it deserves.
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