HARNESSING THE POWER OF FRANCHISING WITH EB-5 CAPITAL

HARNESSING THE POWER OF FRANCHISING WITH EB-5 CAPITAL The EB-5 Immigrant Investor Program is the fastest, simplest and most reliable way to achieve pe...
Author: Alberta Walsh
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HARNESSING THE POWER OF FRANCHISING WITH EB-5 CAPITAL The EB-5 Immigrant Investor Program is the fastest, simplest and most reliable way to achieve permanent residency in the United States. The EB-5 program provides permanent U.S. residency to foreign investors and their immediate families (children up to age of 21) in exchange for job a creating investment into a new American business or real estate project. LCR has transformed the EB-5 government program into a standardized investment product that maximizes job creation, mitigates risk and protects investors’ principal.

www.lcreb5capital.com

KEY INVESTMENT REQUIREMENTS There are 5 important requirements that must be met to successfully participate in the EB-5 program:

1. MINIMUM CAPITAL REQUIREMENTS

5. OTHER KEY REQUIREMENTS

$500,000 investment in a new business or real estate project

Investment must be “At Risk” (i.e. fully invested in the project, fund or new company) for a period of no less than 5 years

• 95% of all EB-5 industry invests through Regional Centers at $500,000 level • $1 million option available for EB-5 direct option (5% of market) • Minimum investment amount should increase to $800,000 by October 1st, 2015 • Amounts have not changed since 1990 (never indexed to inflation) • U.S. Green Card program is cheaper than UK, Portugal, Australia, New Zealand, etc.

2. NEW U.S. JOBS REQUIREMENTS Create or preserve at least ten (10) full-time direct, indirect or induced jobs for American workers Indirect and induced jobs count only if EB-5 investor invests through a federally-designated Regional Center (such as the LCR Overseas Regional Center)

3. BACKGROUND CHECK USCIS requires proof that the investor is not a convicted criminal, does not have history of financial fraud and has not previously violated immigration laws

4. SOURCE OF FUNDS ANALYSIS Can you clearly document that the cash required to make your investment comes from a lawful source? Acceptable options include: • Salary earned through lawful employment • Gifts of money from family members, friends, employers • Profits made from sale of a house, real estate or other assets • Loan (as long as the loan has collateral and the investor has the obligation to pay it back)

Per U.S. law, the EB-5 investor cannot be offered any guaranteed return on or of principal nor possess any redemption rights on capital

HOW TO GET STARTED WITH LCR: EB-5 PROCESS/TIMELINE

APPLICATION PROCESS Within 1 to 2 months of initial contact with LCR Capital ...

Initial Consultation with LCR

Reserve Slot with LCR and Engage Immigration Attorney

Review Confidential Offering Materials and Subscribe to Project

Wire EB-5 Investment and Admin Fee into Escrow Account

Submit I-526 Petition to USCIS

CONDITIONAL GREEN CARD Within 6 to 14 months of I-526 submission CONDITIONAL GREEN CARD RECEIVED Criteria include: • Was required amount invested in new project? • Does business plan prove likelihood of creating 10+ jobs • Were your investment funds lawfully sourced? If denied, investor receives refund

U.S Consulate interview or Adjustment of Status

PERMANENT GREEN CARD Within 20 to 24 months of I-526 approval PERMANENT GREEN CARD RECEIVED Criteria include: • Submit proof that required number of jobs was created • Submit proof that you have sustained your investment in project

Enter United States within 180 days of approval

...

RETURN OF CAPITAL TO INVESTOR No earlier than year 5

90%+ approval rates in 2014

“These (EB-5) immigrants would impose minimal social costs on the United States, compared with the resources they would contribute. New citizens like these would make hefty deposits in our economy, not withdrawals.” — Warren Buffet & Bill Gates, NY Times (July 12, 2014)

BACKGROUND & OVERVIEW

FIRM: LCR is an EB-5 regional center and private investment firm that invests growth capital in the U.S.’s top franchise brands, primarily in the quick service restaurant (QSR) and hospitality sectors as well as signature real estate projects. The firm sources its capital from global high-net worth investors seeking permanent U.S. residency through the EB-5 Investment Visa program. As a firm founded by first-generation U.S. immigrants, we understand the challenges and opportunities of starting a new life in the United States. EXPERTISE: LCR combines expertise in lending, franchise strategy, and franchise operations – and applies this expertise to benefit EB-5 immigrant investors. LCR’s principals and its affiliates have extensive franchise finance experience including franchise lending, new development, operations and franchise sales totaling over $500 million.

“The Number One Best Way For Investors To Immigrate To The U.S.” — Forbes (July 2014)

REGIONAL CENTER: LCR received approval by the U.S. Department of Homeland Security to operate the LCR Overseas Regional Center (“LORC”) for the purpose of promoting investments in job creating projects across the Greater New York Metropolitan area. TEAM: LCR’s senior management team built and established distinguished track records while serving at many of the world’s premier organizations including: McKinsey & Co., JPMorgan Chase, Credit Suisse, UBS, BlackRock, EMP Global, HSBC, Rio Bravo Investimentos, INVESCO, Fox Point Capital, Frontier Strategy Group, the U.S. Congress, and other leading global institutions.

THE IDEAL B-5 INDUSTRY: RESTAURANT FRANCHISE Strong job generation, high growth, low risk • Strong Job Creation: QSR franchises are one of the highest job-creating industries in the U.S., generating 20+ jobs / store • High Growth: The $521 billion U.S. franchise industry has grown over 26% since 2010. Dunkin’ was the 16th largest global franchise brand in 2014 with sales growth twice as fast as Subway’s and Pizza Hut. • Lower Risk: Franchises operate under business models that have an established, verifiable track record. In fact, Dunkin’ enjoys one of the most successful new store development rates in the U.S. with annual closure rates of less than 2%

LCR’S EB-5 PRODUCT IS DESIGNED TO ENSURE MAXIMUM JOB CREATION, PRINCIPAL PROTECTION AND RETURN TO ITS INVESTORS: LCR provides loans to experienced multi-unit operators to build and open new units as well as purchase land underneath the same stores generating rental income and additional security for our investors: • Strong Collateral: Each loan made by LCR will be protected with several safeguards which may include: (i) land under stores, (ii) “Step-in” rights by LCR and (iii) personal guarantees from experienced operators with a typical net worth of > $15 million. • LCR borrowers Have “Skin in the Game”: LCR requires each borrower to contribute ~ 25% of project cost with their personal equity, adding security to loan.

LCR EB-5 INVESTORS $500K

Admin fee

LCR American Opportunity Franchise Fund

LCR Overseas Regional Center LLC

LCR Franchise Finance Fund

LCR provides loans for experienced operators to build new Dunkin’ stores

LCR purchases land parcels that generate (i) rental income and (ii) profits from sale of land parcels at end of holding period

INVESTORS ARE REPAID THEIR ORIGINAL INVESTMENT after a 5 year period

LCR’S EB-5 PRODUCT HAS SEVERAL ATTRACTIVE BENEFITS AND RISK MITIGATION COMPONENTS INCLUDING: Criteria

LCR

Standard EB-5

Strong Job Creation

19 Jobs per investor

12-13 jobs per investor

Experienced Team with verifiable Track Record

30+ years of experience

First time project operators

Conservative Investment Structure

Mutual-fund like structure

All investors in single project

Proven Exit Strategy

Loan

Increasingly structured as equity

Top Quality Brand

Global, proven QSR brands only

Brands/projects with no other source of capital

Shovel-Ready

Low Cost to Build Store

Need All Investors to Start

Local Office in Miami and São Paulo

First RC to invest this way

“Suitcase Marketing”

U.S. SEC-registered Broker Dealer

To ensure our investor’s protection

Less than 20 RCs operate with this additional investor protection

EB-5 Holding Period  

5 years              

6-10 years 

“LCR Capital Partners…could be a game changer in the franchise finance world” — Franchise Times (Sept. ’14)

This material does not constitute investment advice, an offer or commitment to sell securities, a solicitation of any offer to purchase securities, or any advice or recommendation to enter into or conclude any EB-5 sponsored transaction. You should consult your legal counsel, accountants, and/or tax advisors prior to making any decision or taking any action concerning the information provided in this document.

Westport, CT 315 Post Road West | Suite 200 P: 203.883.1940 | F: 203.883.9262 [email protected]

W E S T P O R T

Miami, FL 501 Brickell Key Drive | Suite 410 P: +1 786.618.9195 [email protected]

M I A M I

www.lcreb5capital.com

São Paulo, Brasil Rua Afonso Braz, 473 | 9o andar | Vila Nova Conceição P:+55 11 2500 5984 [email protected]

S Ã O

PA U L O

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