In3 Project Capital – Inception to Due Diligence to Completion Getting Started (Pre-Qualification) with a Project Finance Capital Guarantee

In3 Project Capital – Inception to Due Diligence to Completion Getting Started (pre-qualification) with a project finance Capital Guarantee

From “inception to completion”, this outline shows how Developers and Sponsors can rapidly finance mid-market projects at favorable terms. Some activities will naturally happen in parallel, but steps are grouped into three distinct stages, based on key milestones to be reached, or gates. The first stage/gate is pre-approval of the project’s package, including availability of a suitable capital guarantee – Bank Guarantee/SBLC or Sovereign* – via an RWA Letter, then rapid due diligence. If final terms are accepted, financial closings take less than 30 days. More definitions.

Inception to Due Diligence – up to 15 days 1. Developer arranges for issuing bank to state they are ready, willing and able to proceed with sending a suitable SBLC/BG or SG when the time comes, once offer is accepted. 2. Company uses In3’s templates for proposed RWA Letter and guarantee instrument. RWA Letter is sent via Email. An EOI from In3’s side can also be made available. Apply & 3. BG/SBLC or SG instrument verbiage for MT760 is agreed between Company and In3. Qualify 4. Qualify: Company delivers project information including uses of funds, draw schedule, RWA Letter (In3 will respond with name of receiving bank), financial projections model in Excel, and project summary for subsequent due diligence. Send to [email protected]

Due Diligence to Offer – up to 30 days 5. Project proceeds through due diligence. RWA Letter forms a crucial part of DD package. Note that actual bank instrument is not sent until all agreements are signed (step 11a). 6. Underwriters agree to finance; equity ownership stake negotiated with Company. 7. Establish SPV, or disclose name and domicile of SPV already in existence, where Accept assets will be held. SPV is presently owned 100% by the developer or sponsor(s). Offer 8. SPV bank account established with optional, mutually-appointed escrow agent. 9. Accept Offer: Capital partners prepare and issue Loan Agreement and Share Purchase Agreement (SPA). A binding may also be issued at this stage if necessary.

Guarantee Instrument Delivery to Capital Draws 10. Issuer sends MT799 or 199 pre-advice or (better) bank-to-bank email to receiving bank. Courtesy copy also sent by email to In3 and/or Affiliate. 11. Execution of various agreements (SPA, Loan Agreement, or Binding Termsheet) subject to Condition Precedents (CPs) as follows: Fund & a) EPC/GC contract signed, if any, and issuer sends agreed-upon SBLC/Bank Guarantee Launch or SG, which is issued to capital provider’s bank via Brussels Swift MT760. b) 100% of shares put into escrow for benefit of capital provider until Commercial Operation Date (COD) when shares are then allocated to proportionate owners. c) Scanned courtesy copy of SBLC/BG or SG instrument is sent to In3 and/or Affiliate. 12. Issuer sends hard copy of MT760 instrument to receiving bank via bonded courier. 13. Fund & Launch: First capital draw within 30-45 days of receipt and confirmation of SBLC/BG or SG hard copy, pursuant to agreed-upon draw schedule. 14. Continuous draws according to schedule. In practice, draws accommodate critical path construction milestones and cashflow requirements with target of even monthly amounts.

* Sovereign Guarantee (SG) procedures are largely the same as a Bank Guarantee (BG)/Standby Letter of Credit (SBLC), but with one added step: SGs require confirmation of public/private cooperation via a letter from the developer.

Contact your authorized In3 Affiliate, or In3 directly at +1 831-761-0700, with any questions