Our bonds currently pay four percent base interest but the interest rate can rise to as much as 10% when the life insurance portfolio and the growth company loan perform. We sync good portfolio performance with higher interest rates. The buyer of these fifteen-year bonds also receives warrants in the promising growth company to provide even more upside potential. Private equity-like upside with investment-grade bond-level safety.
Our system is structured so that a separate Special Purpose Vehicle (“SPV”) issues each YESbond™. All of the assets are held by a trustee. About half the bond proceeds are invested into life settlements, and typically into twice as much insurance (at face value) as the bond principal. About one-third of the proceeds are loaned to a promising growth company. The rest is put into high quality liquid assets.