How does collateralized lending work?
Adam Capital specializes in collateralized lending. This model requires that a borrower pledge significantly more value in assets than the loan amount.
We require that all borrowers collateralize our loans with a minimum pledge of assets valued at 150% of the loan amount. Collateral for our loans typically includes cash incentives from local utilities, states, and the Federal Government. Developers also pledge additional collateral in the form of equipment and power purchase agreements.
Our strategy of senior-secured lending ensures that Adam Capital has priority claim in advance of all stockholders in each project or company to which we extend loans.
Adam Capital extends loans under $5 million, a place within the lending spectrum with few direct competitors. At the present time, no banks, secondary markets, or bond markets serve this niche. Larger banks limit themselves to utility-scale projects with minimum investments of $10 - $100 million and banks that could lend in the $500k- to $5-million range often lack the expertise to engage effectively in this important sector.
We have used this model to fund over 1000 projects in 5 states, bringing over $30 million to the clean energy marketplace.
Adam Capital is a licensed California Finance Lender. CFL #603-H182