First off I am not sure if I am understanding your question. Let me see if I can clear this up a little bit. What you are calling a Guarantor Fee, sounds more like a preferred return. Would such a preferred return be actually paid every year or does it accrue and is paid out of the funds at the end? Also, what other items of control or managment fall on the shoulders of the personal guarantor? Does the personal guarantor also have the largest interest in the syndication? What rights do they have in the decision making? I would assume that the fee is a unique blend between money paid, money accrued and paid at the end, and management rights. If it is hard to come to agreement on one, try to give away something on the other side. For example, if the fee is too high, trade a portion of the fee in exchange for greater rights. Or trade a portion of the fee to be paid each year for a preferred return at the completion of the syndication. Each of these issues has a unique blend of characteristics for which you should consider the positives and negative effects to each party. Good luck this is a complicated one.
Note, the poster of this answer is a trained accountant with experience in contract law and Alumni of the "Big 4 Accounting Firm," Ernst & Young.
Jun 1, 2012