As a general disclaimer, Borrowers should consult with their tax and legal counsel given the unique tax and legal issues involved with stock loans.
A stock loan allows borrowers the flexibility to gain access to the locked-up value of their freely-traded stock position without having to actually liquidate their position in the open market. Stock loans are most suited to corporations, its employees, officers and other major holders of publicly traded companies.
JSX Investments works with several lenders and collaborates with the Borrower on the terms of each and every loan. The process is quick, transparent and completely confidential. Loan proceeds can be used for personal or business purposes or to diversify or hedge current stock positions.
Loan terms are based on evaluation of the risk and future performance associated with the securities to be pledged as collateral. The terms range from 1 to 8 years, with interest payments on quarterly, semi-annual or annual basis.
Stock loans are interest only and non-recourse, so the Borrower has the option of simply walking away at any time with no further liability.
In the event of a loan default there is no reporting to any credit bureau or governmental agency, nothing on file or any public notice. There is no adverse consequence to the Borrower’s credit.
JSX Investments will help you source out multiple financing options to obtain the best financing possible in today’s marketplace.
You provide ticker symbol, stock exchange, desired loan amount and number of shares to be pledged.
We will obtain verbal quotes from several lenders and submit the quotes to You. You then pick the best quote and request a written Term Sheet (offer for the loan).
Prior to the Lender issuing a written Term Sheet outlining the terms of the loan, you must execute a "Stock Loan Fee Agreement" and submit a copy of brokerage statement verifying securities owned and photo ID.
Lender issues a written Term Sheet, which You may execute or negotiate its terms. Upon execution of Term Sheet, the Lender sends out the Loan Agreement to You or your attorney. A custodian bank/transfer agent is selected by Us which will hold the shares. Loan Agreement is negotiated and then signed with Lender.
Upon execution of Loan Agreement, You and the Lender make arrangements to place your securities with a mutually agreed local custodian bank/transfer agent of your residency or the country where the security is traded or in any country You choose.
A 3-way agreement is signed by You, Lender and Custodian Bank, and a "Closing Statement" is prepared. You will deposit the stock with Custodian Bank/Transfer Agent and Lender wires the funds to Custodian Bank or any bank in any country that You choose.
You are now in possession of your funds. You can transfer them. You can withdraw them. The Lender does not control how you use the funds or the country that you choose to receive the funds.
This is a loan taken out against publicly traded stock that is fully owned, and pledged as collateral. The program allows the stock holder to borrow funds, without selling any shares.
The stock must be publicly traded, in electronic form (not certificate) and the stock must be unrestricted.
No. Personal credit is not checked. The loan is made against the stock, not you personally.
Our Lender will determine a loan-to-value ratio, based upon the stocks’ liquidity and risk predisposition. LTV’s usually are up to 40-80% of the value for many stocks.
Usually the interest rate is between 5% and 10%, depending on the security and the factors outlined above.
No. There are no personal guarantees.
No. Once the loan documents are completed, the funds are transferred to you and you can deploy the funds as you please.
Once you complete the intake form, we will obtain a term sheet. Once you approve the term-sheet, a loan agreement will be prepared and sent to you. Once the loan agreement is signed, funds are normally transferred with a few days. The entire process might take up to a few weeks at most.
The shares remain yours unless you default on the loan. Therefore, at maturity, when the loan is repaid, you receive your shares back along with all dividends. You may choose to use the dividends to offset any interest due on the loan.
Your shares will be forfeited if you cannot repay the loan. This will not affect your credit. The Lender provided the loan to you against your stock, not you personally.
The shares will be held in your name, with a custodian bank. The shares will not be reassigned, sold, traded or transferred.
This is a risk, but only to the Lender. As this is a nonrecourse stock loan, the Lender cannot demand compensation for any amount in excess of the value of the stock.
No. You will receive a term-sheet with all the terms transparent and spelled out.