Our fees are typically a combination of upfront engagement fees of approximately USD$50,000, annual custodian and administration fees of about USD$20,000, annual audit fee of about USD$5,000 to USD$10,000, and annual management fees of 0.2% to 0.5% of the asset value of all illiquid and liquid assets in the investment vehicle.

BlueSeed Holdings or its principal shall act as an independent business advisor to successfully referred clients who set up investment vehicles with Abacus Capital, but Abacus Capital remains as the legal managers of the investment vehicles.

These are generally the documents we can help to prepare:

1. Executive Summary

2. PowerPoint for presentation

3. Market Research

Relevant market research reports (especially used for the market forecast)

4. Financials

Scenario-based financial forecasting, market forecast, peer comps table, performance ratios, valuation modeling based on scenarios (note: ‘scenarios’ refer to conservative forecast, medium forecast and high-growth forecast), capitalization table

5. Compiling an ordered and structured due diligence package

These documents are generally optional:

1. PowerPoint for reading over

2. Business Plan

These are the documents which you need to have beforehand:

1. Product Description(s)

2. Overview of the revenue model

3. The value proposition (I can help with this ie to refine it if needed)

4. Existing product / your minimal viable product

5. Existing contracts, MoUs, trials, subscribers or similar for your new and/or current product to substantiate the investment case.

6. Historical financial statements (income, balance sheet, cash flow) if your company is already in revenue for each entity (if the company has multiple subsidiaries)

7. Shareholder registry for the capitalization table

8. Incorporation document and legal information such as Permits and Licenses etc. (if needed for business operations)

• Initial 1-2 phone/skype/in-person call or meetings to have a better understanding of the firm

• Soft copy of mutually filled, executed and signed capital referral agreement (agreement provided by BlueSeed)

• PowerPoint pitch deck. No more than 20 slides

• Short description detailing the company’s business model, revenue model, competitive advantage, business traction, target capital raise in exchange for how much of what type of instrument (equity, debt, convertible etc.), and objective(s) of the capital raise. Not more than 250 words.

In reality, a company is always evolving and the documents can never be say said ‘completed’; hence such documents should always reflect the date they were last updated. Moreover, readiness of the due diligence package to raise capital, however, can range between 3 weeks to 2 months, depending on the company’s business model, and industry and investor requirements etc. As BlueSeed is a service corporation, this service would require upfront fees to cover our time and resources used.

Example 1: In this example, the client is selling a well-known product, the client is not touching the product & it is being drop shipped from a well known supplier to a well-known customer. This is the simplest transaction and relatively easy to approve.

Example 2: This example is one that requires a contract manufacturing agreement where the client has designed a product line and hires a contract manufacturer to manufacture the product. In this scenario, the funding company must be confident that the client has arranged the fabrication of the product to meet the requirements of the customer and that it will be delivered in the timeframe stated on the

purchase order. The supplier is typically paid via a letter of credit. If the goods are first sent to the client’s warehouse for sorting and packaging and then shipped to multiple customers then the funder would need to trust that the client can perform this relatively simple task and how they could step in and take over the task if the client failed. It would be preferable if the client was using a 3rd party warehouse for sorting, packaging and freight forwarding. The funder would then enter into a warehouse agreement to control the inventory.

Example 3: In this example, the client is fabricating or manufacturing the product themselves and needs the funding company to purchase components of materials for them to assemble or to manufacture into a product. In this example, the funding company must be confident that the client has the skills to build according to customer requirement, be able to deliver according to required delivery dates and has the financial capacity to pay the cost of labor and overhead while the fabrication is ongoing.

​Alternatively supply chain finance may be a viable option for more established companies.

HOW IS THE FINANCING ARRANGED?​

Financing will be provided by a bank plus private equity funds, as managed as a joint venture.

HOW DOES THE LTV/LTC WORK?​

The 1st lien on the property will be 60-75%. The 2nd lien on the property will be ​ up to the combined 97%.

​EXITING THE JV SPLIT:

After the bank loan, priority return of JV partner's investment, and then split between 10% to 40%, depending on the cash/equity, the borrower invests in the deal. Varies case-by-case.

PARTIAL RELEASES?

Partial releases are granted for sold parcels / lots / units at 75% to 85% of sale price. ​

IS THERE A PREPAYMENT PENALTY?​

Any prepayment penalties are set by the bank on the 1st lien only. ​

SECOND MORTGAGE?

Not permitted. Under this program, the JV partner is in 2nd position. No other debt is permitted.

WHAT ARE THE 3RD PARTY REPORTS?

3rd party reports may include: Full Appraisal (MAI, state) or even a BPO. Phase 1 environmental, soils test, ordered by Lender at expense of borrower. Existing reports less than 6 months old, completed by qualified firms may be rectified.

HOW DOES VALUATION OF THE COLLATERAL WORK?

​Financial Instruments Bid Value:

Borrower must demonstrate to the Lender the current as-is market value of the collateral (the Bid Value). For financial instruments, it may be possible to secure a bid from a viable bond/stock trading house. For diamonds, gold, and other commodities routinely traded in the public sector, the as-is trading value can usually be established.

A copy of the Bid (or trading value) is provided to the Lender who will use it to prepare the Term Sheet and subsequent loan documents.

At the time that the transaction is ready to be funded, the Lender will secure another final bid for the financial instrument from a major US bank or security house, which will be used to finalize the loan amount. There is no additional cost to secure this final Bid Value.

Precious Commodities Bid Value:

It is up to the Borrower to demonstrate to the Lender's satisfaction the current as-is market value of the collateral. A legitimate arms-length offer to buy; a bid by a trading institution. The Lender will NOT use an appraisal alone to set the value. An appraisal, less than 6 months old, from an established appraiser with credentials in the specific area of the collateral may be acceptable, but ONLY to support the claimed publicly traded value.

A copy of this valuation is provided to the Lender, which will be used initially to prepare the loan offer and loan documents. At the time that the transaction is ready to be funded, the Lender will secure a final valuation for the commodity from a major valuation firm, which will be used to finalize the loan amount. There is no additional cost to secure this final Bid Value.

WHAT IS THE EXPECTED ROLE OF ALL PARTIES INVOLVED?

• Producer : Shall be solely responsible for all production services traditionally associated with the development, pre-production, etc.

• Arranger : Shall arrange and facilitate the full financing of the project.

• Lender : A bank to be determined by the Arranger.

• Borrower : Arranger shall create a new single purpose vehicle (i.e., an LLC, LPC, etc.) designed exclusively for the purpose of borrowing funds from the Lender to fund the project.

HOW DOES THE COLLATERAL WORK?

A Single Purpose Vehicle is created and shall be secured and backed approximately as follows:

1. Bankable Pre-sale: 15%: Producer shall secure a bankable pre-sale agreement with a sales agent or distributor.

2. Bridge Pre-sale Commitment: 15%: Pending income to be generated from product placement/other, the Producer shall collaterize 15% which shall comprise a holdback of partial fees payable to Producer, Writer, Director, Service Providers and/or other budgeted items back by two major territories or a combination of smaller territories.

3. Arranger Gap: 15%: Arranger shall provide collateral in the form of cash, a line of credit or other form of bankable guarantee.

4. Tax Incentives: 25%: Producer shall provide a commitment of 25% representing the discounted value of Tax credits, Rebates and Grants.

5. Arranger Commitment: 10%: Arranger shall provide collateral in the form of cash, a line of credit or other bankable guarantee.

6. Producer Equity Commitment: 20% Producer shall provide cash or cash equivalent guaranteeing the Borrower's payment of its obligation to the Lender.