As I study the EB-5 application process, I have realized that reimbursement in case of completing the project or failure is not a common practice. Should I demand adding a clause about this in my contract? Would all regional centers be willing to do something like this? If I ask for this and get a no, is that a red flag?
Answers
Peter Zhang
EB-5 Immigration attorneysYou may negotiate a side letter with step-up provisions that increase returns on your principal investment at set intervals (e.g., every six months). This raises the cost of capital over time, creating a financial incentive to redeem of your EB-5 investment.
Jimena G Cabrera
EB-5 Immigration attorneysTo qualify as an investment, the immigrant investor must actually place their capital at risk. Any capital invested under agreements granting the immigrant investor a contractual right to repayment does not qualify. For an investment to be deemed "at risk", there must be a potential for both loss and gain. Essentially, if the immigrant investor is assured a return or a specific rate of return, that investment does not qualify as being at risk.
Lynne Feldman
EB-5 Immigration attorneysYou need to review the project documents for this information and if not there inquire for something in writing. There can’t be a guaranteed return or the investment won’t qualify for EB-5 approval.
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