Due Diligence
We provide our Clients Trade finance solutions and help them grow their business and also assist clients Invest in Secure High Yield Investments programs for higher returns.
Introduction
On behalf of our financial partners and before submitting documents to our lender, we are responsible for confirmation of the project owner, documents and the status of properties/projects. Our financial partners must complete the Due Diligence forms on the site visit and provide them, along with photos of the project and the project owner, to our financial partners. Otherwise, your project will not be reviewed and will be rejected. must complete the Due Diligence forms on the site visit and provide them, along with photos of the project and the project owner, to our financial partners. Otherwise, your project will not be reviewed and will be rejected. This introduction to due diligence covers the basics concerning due diligence.
What is Due Diligence?
Why is due diligence conducted ?
There are many reasons for conducting due diligence, including the following:
- Confirmation that the business is what it appears to be;
- Identify potential “deal killer” defects within the project to avoid a bad business transaction and non-financing of the project;
- Gaining information which will be useful for valuing assets, defining representations and warranties, and/or negotiating pricing & the interest rate;
- Verification that the transaction complies with investment or acquisition criteria;
- The Due Diligence phase of a transaction is conducted in the order specified on our checklists and worksheets, to summarize information found in conducting thorough review to verify the project owner, seller’s title and the status of any and all properties/projects;
- Conducting proper Due Diligence may serve as a strong legal defense to any claims after a transaction closes. Due diligence may also reduce legal issues by alerting a purchaser or investor to potential liabilities that can be mitigated in various ways prior to closing the transaction;
- The Due Diligence Forms are used to close a transaction or get financing for the projects, as provided in a Purchase and Sale Agreement;
- and it often occurs that a project is excellent, however due to lack of a few documents it will not receive funding and will be rejected. Usually, financial institutions and banks will not tell you the problems of your project and the reason for rejection.
Who pays for due diligence?
Can fee be paid at closing?
The investigation and evaluation of your loan application may often require travel to your project site, meetings, appraisals, permits, legal fees, etc. Third parties, such as appraisers, accountants, architects, consultants, engineers, lawyers, surveyors, and government officials are needed to accomplish these tasks. Each one of these professionals has to be paid for their work at the time the work is completed.
Special Notice about the first site visit
Project Inspection
- After receiving the full package(s) for the project(s), the owner of the project should invite us for a face to face meeting, physical site visit for the project(s) and the signing of all required contracts. The owner of the project also has to sign a confidentiality / non-disclosure / non-circumvention agreement, to protect mainly their interests at this early stage. We ascertain beforehand whether a project is worthwhile to pursue, as we do not wish to waste our time.
- The site must be visited and ownership must be proven by the applicant.
- We must meet the Client on site (a legal verification requirement).
- The first site visit, by at least two of our senior executives, remains mandatory for legal reasons and serves to:
- Meet the client, as well as any partners or management teams and physically verify the accuracy of the project ideas proposed.
- View the site(s) and its surroundings with the client.
- Meet local officials and to ascertain to what extent this project is known of and welcomed.
- View all plans/studies/documents/drawings/tests/surveys, as completed and are available, and enquire about planning & building laws enforced locally.
- Confirm all future procedures/timings/requirements with the client, as well as assisting in determining the future development costs and timing issues.
- Many general project questions cannot be answered UNTIL WE HAVE MET AT THE SITE VISIT. We are unable to deviate from this procedure.
- After completion of a site visit, we will issue a written Observation Report, free of charge, summarizing all our findings and outline moving forward.
- At the site meeting, our aim is to meet the executives, view the site, meet local authorities, etc and thus form a definite view of how to recommend to the client to proceed. We also look carefully at the proposed future management structure. All in all, we verify the client’s position, the projects existence and past statements made by the client, by means of our written meeting agenda issued beforehand.
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