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Emilee Weaver
Emilee Weaver, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 69
Experience:  VP, Director of Finance
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Where can I obtain a loan of up to 3,000,000 USD using

Customer Question

Where can I obtain a loan of up to 3,000,000 USD using restricted stock I own in a private company, as collateral for that loan.
Submitted: 1 year ago.
Category: Finance
Expert:  Andy4712 replied 1 year ago.
Here is a company:
Customer: replied 1 year ago.
Thank you Andy for the prompt response, we are currently investigating this lead. However we will have more questions for you as that process continues.
Expert:  Andy4712 replied 1 year ago.
Ok. If you think I answered your question, then please accept my answer. Thank you.
Customer: replied 1 year ago.
Andy,Thank you for your response and inquiry. It is clear to us that you are trying to be helpful and answer our question.Please understand our staff has done extensive research for lenders, boutique banks, hedge funds, etc. etc. and we have not found a lender that will consider "using restricted stock I own in a private company, as collateral for that loan.” That quote is from our original question to you. The operative term is “restricted stock.” The stock in question is in a highly profitable, world-class company, literally the world’s leader in its sector. It is a company that has no debt, over a hundred million in annual income and outpaces industry averages in every metric by a multiple of 2-3.We own slightly more than 4% of the company and they distribute about a million a year in income to us for that interest. Our share of the company is valued at many times $3,000,000, the prospective loan in question, but it is a private company and the stock is restricted under the provisions of the by-laws. I give you this background so you know we very serious and are not wasting your time. Now, the company who’s web site you answered with indicates they are NOT notes business of lending against “restricted stock” like virtually every other lender we have researched.So, either you didn’t understand the question completely or you mistakenly thought they would consider in good faith an application using restricted stock when they indicate they will not, or we have misinterpreted their web site and they will consider such an application. But hopefully you will understand that with such doubt that this is a lender of the type we asked about, we can’t approve the answer. We are researching if this company will consider an application based on restricted stock and if we find they will you’ve answered the question and we will gladly approve. Please understand we are only looking for a company to provide good faith consideration, nothing more. But at this stage it appears they will not, and if they will not, we don’t believe the question has been answered.If you would like to engage this dilemma and even have a meaningful dialogue and provide useful guidance for our problem we will be appreciative and happy to approve the payment for your time.Let us know what you would like to do. Thanks much.
Expert:  Andy4712 replied 1 year ago.
That was the only company I could find. Maybe another expert can help you. I will opt out.
Expert:  Emilee Weaver replied 1 year ago.
This is definitely a tough loan to find lenders for, though I do think that they exist. I am attaching a link below of two companies that appear from their website to loan on restricted stock, once notes this specifically, the other says that they will lend on "certain" restricted stock and they market towards internal executives with restricted stock, so you would have to investigate that further. In addition you might want to explore whether there are any other types of investors, such as large Family Offices or Multi Family Offices that might consider this type of arrangement. Sometimes these Family Offices are more open to unique investment situations. I honestly don't know how you might get introduced here. It might be worth trying to reach out to an investment firm working in the M&A area that might have worked on deals with these types of investors. Financo is one Company that comes to mind, not necessarily to loan you anything but maybe to facilitate you meeting a broader range of investors. I would also recommend that if you have a personal portfolio with an investment bank that you contact them and ask their advice. Though they certainly won't offer you the loan they may have someone in their network who can help. Many financial advisors would love to refer this kind of business to the right investor. I know this doesn't lead you straight to an investor, but I hope that it gives you some additional areas to explore. Emilee Weaver, CPA
Expert:  Emilee Weaver replied 1 year ago.
Also, I think that you may find the fact that it is not public stock a disqualifying point with many lenders, so make sure that you bring that point up right away in discussions with any potential lenders. This may save you some time.