Below we have outlined the primary modifications that have been made in Percent’s investor-facing documentation for your convenience. As with every offering, we recommend investors carefully review all documentation and reach out to [email protected] with any questions.
As of October 26 2020, this new documentation has only been implemented for 1-X with SellersFunding.
- Subscription instructions found at the beginning have been simplified and updated to account for our current workflows. Previous documents contained language which allowed subscription agreements to be mailed as well as the ability to fund investments via checks. All subscription agreements will be executed via HelloSign, a 3rd party platform leveraged for electronic signatures, until Percent develops and embeds the investment process into our own proprietary e-sign workflow.
- In previous subscription agreements, our notes were referred to as “Platform Notes”. Moving forward all notes will be referenced as “Unsecured Notes”. Note that while the naming has changed, all offering continues to remain 100% collateralized, just as they have been, by underlying assets purchased by the issuer SPV via our participation agreements signed with each originator.
Form of Note
- Investors will no longer be asked to execute a Borrower Payment Dependent Note (“BPDN”). Instead, directly following each subscription agreement, a Form of Note will be attached. The Form of Note is the promissory agreement that outlines the legal obligations between Percent and our investors. While the format of the document has substantially changed with new terms, the purpose of the document remains the same as the prior BPDN.
- The prior BPDN referenced the note as the “Platform Note”, while the new Form of Note referenced the “Unsecured Note”.
- Please note that the yield in the Form of Note is per annum. Thus, for notes with tenors under 12 months, the yield in the Form of Note does not reflect the yield for the time the note is held (i.e. the Holding Period Rate or “HPR”), but rather the annualized percentage yield (“APY”). Please reference the Final Term Sheet distributed after each deal closing and/or the Security Details of the note’s deal page for the HPR.
PPM and PPM Supplement
- Moving forward, deal pages will include a separate PPM and a PPM Supplement for download.
- The PPM will be more Percent specific at a high level to outline the overall platform, Percent’s role and responsibilities as the manager, other considerations for all note programs and risk factors related to all note programs.
- The PPM Supplement will be more deal specific to outline material differences between underlying originators, underlying assets, unique structural details and unique risk factors. Other notable changes are that the PPM Supplement will include relevant security details such as the maturity date of the note and the payment schedule, which would typically be found on the deal’s term sheet.
Please note that this summary and description of changes is not extensive nor comprehensive. We strongly encourage all investors to thoroughly review the respective transaction documents for each transaction and reach out to [email protected] if you have any questions.