Africans-Stop-Being-Poor
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1563-4108

AFRICABIZ ONLINE SYNOPSIS RSS FEED
Trading And Investing In & Out Africa

ISSUE 50 - VOL 1
JUNE 15 - JULY 14, 2003

Dr. Bienvenu-Magloire Quenum
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Welcome to AFRICABIZ, Please scrolldown to see more

Welcome to AFRICABIZ HTML Email edition.Previous issue available at this link

Dear faithful reader,

THE PROBLEM OF COLLATERAL'S ENHANCEMENT TO SECURING A LOAN

In previous delivery "How Financing Research Brokerage Works" we stated the following concerning the security or callateral offered by a Borrower to securing a loan:

"Because, everything said, the final guarantee to Loan Closing / success boils down to the kind of Security, Collateral or Bank Guarantee offered.

The Security offered could be backed and or enhanced by a Financial Indemnity Bond to increase the chance of Loan Success."

Indeed, there is no doubt the quality of the collateral offered by a borrower increases his chance to securing the loan. A good Busineess Plan and the best Management Team in the world are not enough to convincing lenders to invest in your project. Positive Cash Flows over loan duration, which are indication that the project is bankable and will pay back interests and principal need to be supported by a good Collataral or Security.

WHAT IS A SECURITY / COLLATERAL?

A Search of the word Collateral in GuruNet gives the following definitions:

1- A Collateral is a Property acceptable as security for a loan or other obligation.

2- In other words, a Security or Collateral is a Financial Instrument issued by a Borrower to a Lender.

3- Or again: Property or assets that are offered to secure a loan or other credit.

4- Property or its equivalent that a debtor deposits with a creditor to guarantee repayment of a debt.

5- And on the legal ground:
Property pledged by a borrower to protect the interests of the lender in the event of the borrower's default.

Collateral becomes subject to seizure on default. Acceptable collateral includes any or combination of the following:

1- Cash Deposit.
2- Bank Guarantee
3- Letter of Credit
4- Certified Deposit.
5- Promissory Note
6- Current Gold Certificate (GLD, GBC)
7- Bank Draft.
8- Cashier Check.
9- Government Bond
10- Treasury Bill.
11- Insurance Guarantee
12- Surety Bond
13- North American / Western European Real Estate.
14- Blue or Red Chip Stocks/Shares.
15- Precious Metal / Gemstones (with appraisal or valuation).

HOW GOOD IS A SECURITY?

A bank or a state endorsed guarantee are the best guarantees accepted by lenders.
Collateral(s) provided by borrower must have a tangible, bankable value. The issuing Bank must be a top bank, a country's CENTRAL BANK, or an AA or AAA rated insurance company. Minimum face value of instrument is US$15 Million.


THE PROBLEM OF A THIRD PARTY GUARANTEE


You will never (if ever!) lend money to your best friend without the guarantee that he will pay you back. Right? So does the lender to a borrower.

Furthermore, financing sources / lenders prefer to have multiple guarantees instead of a single one. That is why a borrower is always confronted with the problem of Security or Collateral's enhancement.

To have a guarantee acceptable by lenders, borrowers often negotiate Security or Collateral's enhancement with a third party prior to first-contact meeting with lenders.

It has been Dr. Quenum & Associates / Dynamic Group, LTD's experience that third party's arrangements often do not work. Most of the times Third Party Guarantors issue a document called Corporate Guarantee, which is not accepted by lenders.

If the economic analysis of your business shows positive cash flows backed by sound assets (equipment, properties, cash in bank), your project stands on its own as a bankable project.

A third party guarantor will request that you pledge your assets. Unless the collateral he then provides (to enhancing the Security backing your loan request with the lenders) reads as follows: US treasuries, cash, or an AAA rated bank instrument, the lenders will not be keen to accept said collateral. Particularly if it is the so called Corporate Guarantee.

If after the preliminary assessment of your project, based on the Executive Summary and supportive documents, Dr. Quenum & Associates / Dynamic Group, LTD found out that your assets are good, they advise you not to take up the collateral's enhancement problem to a third party.

What is really needed for a borrower to making the meeting-contact with Dr. Quenum & Associates / Dynamic Group, LTD's financing source a success leading to Loan Closing reads as follows:

1- To prepare for adequate answers to questions put forward by lenders, which specimens are here exposed.

2- In case of the purchase of existing business, to negotiate solid acquisition agreements with respective owners of targeted businesses.

3- In case of an expansion drive of an existing business, to secure pro-format purchasing contracts with potential buyers of your production.

4- To draft a comprehensive Business Plan integrating the whole scheme of your business and highlighting the resulting cash flows - separately and globally.

The procedure listed above is more efficient to wining the backing of the Lenders.

During the first-contact meeting with the lenders, if necessary, Security and Collateral's enhancement are discussed and suggestions made by the lenders. That is better for the borrower than pledging its assets with, and paying large fees and commissions to a Third Party Guarantor prior to meeting the lenders.

As every lender Dr. Quenum & Associates / Dynamic Group, LTD's financing partners prefer to be in the position of First Mortgage instead of coming second to a third party guarantor. Which is normal and make more sense. The Third Guarantor got paid for fees and commissions, but is not really taking the risk of lending you the money!

Click here for Time Is Money. Right? And here for BusinessAfrica™ / Dr. Quenum & Associates / Dynamic Group, LTD do not provide Bank Guarantee. However they can, as above explained, assist you for the enhancement of Collateral offered to securing a loan.

"CONTRIBUTOR'S GUIDELINES" are available here. We invite you to contribute to AFRICABIZ ONLINE MONTHLY ISSUE - with articles related to "How Africa Could Bridge The Developing Gap".

Many thanks for subscribing to Africabiz. See you on July 15, 2003.
Dr. B.M. Quenum
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More on  How Financing Research Brokerage Works


Business Opportunities

FLOWERS AND FRAGRANCE PLANTS AGRIBUSINESS AS INCOME BUILDING POWER FOR AN AFRICAN COMMUNITY / PART IV: PRODUCE ESSENTIAL OILS AS A HOME BUSINESS RIGHT FROM YOUR KITCHEN TABLE

There is in the trade equipement size-up for just 2 liters for the boiling sink (primary boiler); and 2, 5 or 10 liters for the secondary boiler, which contains the raw material. [Click here for more on production methods]. Pricing is in the range of US $ 300 to 1,000. Click here for more. Samples of essentials oils obtained with the small scale equipement show on the image below.

Click here
for instructions on how to proceed. For useful instructions on how to prepare the raw material (harvesting, drying and storage) Right Click here and choose "Save Target As" to download an interesting Adobe PDF document. You may need Adobe Reader. Click here for the equipment page
Here is a Newsletter on market trends about raw material pricing. Need courses about Essential Oils before starting the production as a home business? Click here.

And look here to compare selling prices of several essential oils (Input Essential oil in the Search Field of the website or look into Health & Beauty directory) and evaluate your benefits after deducting operational costs. Here is another prices' list.



MORE ON ESSENTIAL OILS
1- Essential Oils Desk Reference
By Essential Science Publishing (Hardcover - Oct 2007)
2- The Complete Book of Essential Oils and Aromatherapy: Over 600 Natural, Non-Toxic and Fragrant Recipes
By Valerie Ann Worwood (Paperback - Mar 1, 1993)
3- The Essential Oils Book: Creating Personal Blends for Mind & Body
By Colleen K. Dodt (Paperback - Jan 3, 1996)
4- Essential Oils Pocket Reference 3rd Edition (Spiral Bound 2004, 3rd Edition) (Spiral-bound - 2004) - Unabridged
5- Releasing Emotional Patterns with Essential Oils
By Carolyn L. Mein (Paperback - Sep 1, 1998)
6- Essential Oils Integrative Medical Guide: Building Immunity, Increasing Longevity, and Enhancing Mental Performance
By D. Gary Young N.D. and Ronald M. Lawrence M.D. Ph.D. (Hardcover - April 1, 2003)
7- Quick Reference Guide for Using Essential Oils2006 10th Edition
By Connie and Alan Higley (Spiral-bound - 2006)
8- Magical Oils by Moonlight: Understand Essential Oils, Their Blends and Uses; Choose the Appropriate Day
By Maya Heath (Paperback - April 2004)

Adobe Acrobat Reader is available here

For more details on the international trade of Essential Oils visit following link

More on essential oils' production on small scale


Control Your Desktop

HOW TO "ALMOST" GET RID OF PINK SCREEN

Ever got pink screen? Have you experienced your screen turning suddenly pinkish? No? Ok . You are the lucky one for the time being.

However do not think that you will never get into that annoying experience of looking at a sreen that suddenly turned pink. There are thousand of people who reported the phenomenon in discussions' forums.

But no one is capable, posting this delivery, to give the proper and last word about it. Some think that the Monitor is to be blamed (Power cord not welll fixed); other that the Graphic card is the responsible device. There are even some who believe that a magnetic field (Speakerss) near the computer may be the culprit.

In addition to the remarkable instructions available in many webpages and support forums to solving the problem, here is AFRICABIZ Online' contribution (Under Windows 98):

1- Click on START and choose CONTROL PANEL.
2- Choose and click DISPLAY.
3- Choose SETTINGS on the Display's Interface and then ADVANCED.
4- On the Advance's Interface choose COLOR MANAGEMENT's tab.
5- On the Color Management's Interface click on ADD. You will see a listing of Color Profiles.
6- Choose the one most appropriate with the trade mark of your Monitor and or Graphics Card. You may choose several Color Profile and make one the Default setting.

Once you perform the configuration' steps above outlined the pink screen occurrence may become less frequent. Once a while instead of daily! And when it does occur, it lasts only few minutes instead of hours.

More on  Pink Screen


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