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PROPHECY FINANCIAL LLC

REAL ESTATE PROJECT FUNDING CONSULTANTS

Private Equity Financing

Equity represents the investment made on behalf of the owners of the project, and usually comes from individuals and/or companies involved in a project such as project sponsors, developers and/or manufacturers, or sometimes from institutional investors such as insurance companies or investment funds. These bodies are expected to take some form of capital stake in the project.

There is an expectation on the part of private lenders that all projects will be at least partially financed through equity. Typically, for well understood, relatively low risk investments, the equity stake may be as low as 30%, but for less well understood (and hence riskier) investments, such as those in renewable based capacity, the required equity stake may rise to over 50% of the total project cost. Equity can take the form of direct capital investment by the borrowers, or as third party capital inputs (e.g. in the form of cash grants and capital subsidies). However, lenders demand that borrowers take an equity stake in their own right (to build their commitment to their stake holding). In today's economic environment it is common practice that lenders normally look for a minimum of around 30% to 40% of the project cost to come in the form of borrowers equity.

Equity differs from debt in that it receives the profit from the project. If the project does well, the equity pay out could be significant. If the project under-performs or becomes bankrupt, however, private equity investors are the last to be paid, after the banks and other claims on the project. Thus equity takes a higher risk and potentially receives higher returns to compensate.

Funding is available for:

This industry is challenging and as you know most traditional sources have stopped lending, as this has happened, our group has streamlined possibilities with our own private equity providers for only those projects that qualify and wish to seek this type of relationship. Our private equity sources are specialists in project sizes of $10MM to $100MM and every project is on a case by case basis. We act as consultants in capacity as we refer funding candidates to unique and private funding sources. Our funding providers accept deals that make sense. Terms, equity positions, contract length and any possible interest rates will vary upon provider, project and other factors, therefore each term set is determined by the funding source that may view your project.

Documentation Package required:

1.) Executive Summary (at least 2 pages)

2.) Business plan (professionally prepared)

3.) Pro-forma income/expense data, forward 5 years (excel format)

4.) Complete construction costs data (excel format)

5.) Balance sheet (if applicable)

6.) Resume on Principal (Sponsor) with PFS (Personal Financial Statement)

7.) Resume on Development Company

8.) Recent MAI appraisal on property and/or project

9.) Feasibility and marketing studies

10.) Detailed use of funds sheet (excel format)

11.) Comprehensive exit strategy

12.) Current liquidity position of Principal (Sponsor) (including Company assets)

13.) Profit potential/rate of return (timing until revenue is generated, timing until profit is available)

14.) Include funding structure desired (draw schedule) and ROI (return on investment) schedule

15.) Include the dollar amount that has been spent on the project to date

Procedure

Candidates will submit the documentation above and when the complete package has been received, along with an executed NCND (non-circumvent, non-disclosure agreement), and a strategic fee and exclusivity agreement, we will review and qualify the project. Upon acceptance, we will then submit the project to our lenders for underwriting purposes. Our NCND and fee/exclusivity agreement are available upon request.

NOTICE: Due to the proprietary and sensitive information of our private equity partners, we provide limited information on our programs via web and mass distribution. Sensitive financing information is reserved for clients who have viable projects and have demonstrated genuine interest and the financial ability to pursue the funding options we have. Our equity partners prefer to speak directly to project principals regarding specific funding information once we have established interest in the project and pre-approved them.

All rights reserved, 2007-2009

Prophecy Financial LLC, Sandy Hook, Connecticut, USA

This document is for informational purposes only and is not a solicitation for the purchase or sale of any securities, nor a solicitation of investment funds or placement. This document does not represent the policies of any bank or financial institution, is not intended as a confirmation of any transaction, and does not consist of any legal, securities or tax related advice.

Prophecy Financial is not a direct lender, realtor, mortgage broker, certified financial advisory firm, securities brokerage firm and/or a stock brokerage firm. Prophecy Financial is a business consultancy firm that facilitates private business transactions and provides consulting services to businesses and individuals on or about private business matters.