Phil is reviewing his options in terms of obtaining and acquisition and construction loan for Calvert Crossings.
The first bank is Cyber Capital – a national lender which is aggressively lending all over the country right now.
Phil and Hyper Kapital have not worked with Cyber Capital before so the tenor of the loan terms is a bit of an
unknown quantity. Also, their “commitment” is more of a very basic term sheet – which I’ve attached to this
The second bank is Longfellow Bank – a regional bank that Phil and Hyper Kapital borrowed on for another
project referred to as Ohio Drive Marketplace. We closed on that loan just before the market took a nose dive
in 2008. Nevertheless, Longfellow Bank’s chief lending officer, Albert Greenspan, worked with Phil and Hyper
Kapital to restructure the loan to accommodate some of the issues that came up at Ohio Drive Marketplace
that were outside of Hyper Kapital’s control. I’ve attached a copy of an executable draft of the loan
agreement that was used on the Ohio Drive Marketplace deal. Longfellow has assured Hyper Kapital in the
current loan commitment that they will use pretty much the same documents that were used in the Ohio Drive
Marketplace loan – so at least we have a decent idea of what to expect. I’ve also attached a copy of the loan
commitment from Longfellow outlining the proposed terms and conditions for the Calvert Crossings loan.
At this stage, Phil would like to weight the comparative features of the Cyber Capital loan terms and the
Longfellow Bank loan terms. Please take a look at the Cyber Capital term sheet, the Longfellow Bank loan
commitment and the Ohio Drive Marketplace Loan Agreement and let me know your thoughts in response to
the below issues by next week:
(1) Review the Cyber Capital term sheet and the Longfellow Bank loan commitment for the Calvert
Crossings deal and confirm the following:
a. Which of the loan proposals is most advantageous for Hyper Kapital and why?
b. Which of the loan proposals is most advantageous for Phil Knox and why?
c. As you compare to the two loan proposals, confirm the different interest rates for each, the
maximum potential loan proceeds under each, the different guaranty and indemnity
requirements for each
(2) Which of the loan proposals would you recommend the Phil Knox and Hyper Kapital proceed with