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Collateral sought on $500K loan to Arctic Circle Air
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Posted on Nov 17 2011
By Clarissa David
Reporter
Reporter
The Marianas Public Land Trust wants to have a “collateral” for the $500,000 loan it will provide to Arctic Circle Air to establish air cargo service between the CNMI and Guam.
“In our terms and conditions, we have outlined what kind of collateral we want such as some assets like aircraft for example and other assets the company may have, which can backup the loan should it not succeed,” MPLT board chair Alvaro Santos told reporters after his presentation at the Rotary Club of Saipan meeting on Tuesday.
The board approved last month the $500,000 loan for Arctic Circle Air, the brainchild of businessman Anthony Pellegrino, to be paid in 10 years at 7.5 percent interest.
Santos, in his presentation at the Rotary, said that Arctic Circle Air “will increase agricultural production from the CNMI.”
“The company has done a lot of research from the market down in Guam, not only in the military but other market outlets. they’re willing to take the risk,” he told Rotarians.
Santos disclosed that the Arctic Circle Air venture is one of three proposals that they are handling in their newly established diversified local investment program, which aims to either provide loans or invest at the local level to boost the CNMI’s economic situation.
The other two proposals are the $13-million Small Business Credit Initiative under the Commonwealth Development Authority and the $2-million electronic health record system project for the Commonwealth Health Center.
Santos said the approval of the loan required Arctic Circle Air to “satisfy the terms and conditions that we offered them.”
“If Arctic Circle Air did not meet the MPLT conditions and terms, they have to look for other avenues like the CDA and an independent bank to get the capitalization,” noted Santos. “I hope that we could help them for this to materialize.”
