March 1, 2017 - SynSel Energy, Inc. has announced that they have executed an Advisor Agreement with the Peakstone Group to source Good Faith Account (GFA) funding. The Advisor Agreement matches the scope of the executed Term Sheet and Commitment Letter that SynSel received from a private lender on February 1, 2017 to fund SynSel’s 2 initial US biorefineries. One plant will be in Ontonagon, Michigan and one plant in Lumberton, Mississippi. A $75M GFA is required for each $300M plant. The $300M loans close 60 days after the GFA is established. SynSel CEO Tim Tawoda stated “Peakstone understands that the private lender has voiced an interest in funding multiple SynSel plants across the US, and they intend to ride the wave of this historic and transformational syn-fuel initiative."
The GFA is brilliant in that a funded GFA validates SynSel’s business proposition to the private lender and isolates the GFA owner from all developer, technology, commodity and incentive risk. It is extremely challenging to fund a first-of-kind biofuels plant since the $300M private lender is taking on all the risk. In the end, SynSel’s private lender reconciled the upside as a partner splitting profits. The private lender weighed the SynSel’s business model, world-class stakeholder team and, Impact Investing benefits with the perceived risks – and they are totally committed. They have the financial capabilities to fund all 100 plants – SynSel’s target in the USA over 8 years.
SynSel's CEO, Tim Tawoda further stated, "SynSel is excited to have a financial advisor as prestigious as the Peakstone Group out in the market place to establish GFA sponsors. I know of no other tool than the GFA that has the ability to open up Impact Investing on scale to pension funds, endowments, debt lenders and private equity while isolating the GFA owner from all risks."