Corporate Finance Institute®

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Date

Borrower

To: ,

We have conducted a preliminary review of your financing request and wish to provide a general outline,
for discussion purposes, of terms and conditions for a proposed credit structure. This Discussion Paper
should not be interpreted as an approval, or as a commitment to provide financing; rather this is an
indication of our interest in pursuing additional due diligence and further discussion around your credit
request. Actual financing terms are subject to final Risk approval, and will be outlined in a subsequent
loan agreement, should our additional review be deemed satisfactory.

This letter is offered for the purpose of further discussion with the Borrower. This document is confidential,
and should not be shared or distributed to any third party or parties without our express written consent.

Borrower Details

Borrower(s):

Guarantor(s):

Facility #1 – Operating Line of Credit

Purpose: Facility #1 is to be used for general working capital purposes.

Amount:

Availability: Facility #1 will be available to draw in support of working capital.

Interest Rate:

Repayment: Facility #1 may be drawn and repaid in $5,000 increments, up to the borrowing limit.

Facility #1 is payable in full on demand by Lender, and Lender may terminate the
availability thereof (including any undrawn portion) at any time without notice.

Facility #2 – Non Revolving Reducing Loan

Purpose: Facility #2 is to be used to

Amount:

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Availability: Facility #2 is available by way of one draw at closing.

Interest Rate:

Repayment: Facility #2 is payable in full on demand by Lender, and Lender may terminate the
availability thereof (including any undrawn portion) at any time without notice.

Borrower shall make blended payments of $ on the last day of each month.
The loan is to be amortized over a maximum period of years.

Facility #2 is non-revolving. Amounts repaid may not be reborrowed.

Facility #3 – Non Revolving Reducing Loan

Purpose: Facility #3 is to be used to

Amount:

Availability: Facility #3 is available by way of one draw at closing.

Interest Rate:

Repayment: Facility #3 is payable in full on demand by Lender, and Lender may terminate the
availability thereof (including any undrawn portion) at any time without notice.

Borrower shall make blended payments of $ on the last day of each month. The
loan is to be amortized over a maximum period of years.

Facility #4 – Non Revolving Reducing Loan

Purpose: Facility #4 is to be used to

Amount:

Availability: Facility #4 is available by way of one draw at the time of equipment purchase.

Interest Rate:

Repayment: Facility #4 is payable in full on demand by Lender, and Lender may terminate the
availability thereof (including any undrawn portion) at any time without notice.

Borrower shall make blended payments of $ on the last day of each month. The
loan is to be amortized over a maximum period of years.

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 Security

Security will be prepared by lender’s legal counsel at client’s expense and will include:

1. General Security Agreement;

2. Collateral Mortgage on the lands located at ;
3. Collateral Mortgage on the lands located at ;
4. Personal Guarantee from limited to $ ;
5. Execution of all loan agreements, satisfactory to the lender and its legal counsel; and
6. Other security as determined by the lender and/or its legal counsel.

Additional Due Diligence Items

1. Please list additional items you would like to see prior to a formal credit submission;
2. Please list additional items you would like to see prior to a formal credit submission;
3. Please list additional items you would like to see prior to a formal credit submission;
4. Please list additional items you would like to see prior to a formal credit submission;
5. Please list additional items you would like to see prior to a formal credit submission.

Financial Covenants

As is customary for a transactions of this nature: .

Reporting Requirements

Borrower will be required to provide annual reporting consistent with the proposed credit structure,
including Review Engagement / Audited financial statements; aged ; and such other asset-
specific reports that are deemed appropriate by the lender and their legal cousel.

Fees

1. Application fee of bps;

2. Monthly operating line administration fee of $ ;
3. Annual review fee of bps; and
4. All security registration and legal fees are the responsibility of the borrower;

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We look forward to working with you. If you have any questions about this document or about its
contents, please contact us right away.

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