Stock secured financing is a new financing vehicle available to shareholders, officers, and affiliates of publicly traded companies on most major international listed exchanges. The Stock Loan is non recourse with no personal liability on the Loan. If the value of the shares declines substantially, the borrower has the option of terminating the Loan, keeping the proceeds with no further liability or obligation.
The lending rates are between 3% and 5% simple interest only paid quarterly. The term of the Loan is between 3 and 5 years, but typically 3 years.
Dover’s affiliates can offer liquidity to those who have concentrated stock positions on any major listed international exchange. Dover’s affiliates will acquire the position at a negotiated discount providing immediate liquidity to the Client.
1. Please apply online through our Request Quote Form for stocks. One of our representatives will contact you regarding your request.
2. Upon approval of your request, we will have a term sheet sent to you outlining the details of the transaction. Term Sheet will cover the interest rate, loan to value, the amount of loan, fees and term of the loan.
3. Once the Term Sheet is agreed upon, we will forward to you a Stock Loan Agreement to be reviewed by you and upon your approval, return to us for Lender’s approval.
4. Usually within 2-5 business days from signing the Stock Loan Agreement, the loan proceeds will be disbursed to borrower either by direct wire funding or by Delivery vs Payment (DVP).
5. Each quarter, borrower makes interest only payments as designated in the Stock Loan Agreement. Any dividends will be credited to loan payment due first, then the excess will be returned to borrower.
6. At the end of the Term, as long as the interest payments are made as required and the stock pledge has maintained the required loan to value (maintenance requirement) the stock will be returned to borrower.
7. If the borrower desires to extend loan or refinance for an additional term, the Lender would consider the request.