Steve Mills

The ratio of the net present value of CFADS during the remaining loan life to the amount of the loan which is still outstanding at the time the calculation is made. A common ratio for the sculpting of debt and the setting / testing of covenants in minerals-based project transactions, such as…

A fixed level of damages payable to the project company/SPV– typically by a construction or operation & maintenance contractor – as a result of the contractor failing to meet contractual obligations. In the case of a construction contractor these will typically be Delay LDs and / or Performance LDs. An…

In a project financed structure, the Sponsors will not normally be under any obligation to provide further financing support to the SPV once they have injected their base Equity. The Lenders are therefore said to have limited recourse to the balance sheets of the Sponsors. In practice it is common…

Know your customer, alternatively known as know your client or simply KYC, is the process of a business verifying the identity of its clients and assessing their suitability, along with the potential risks of illegal intentions towards the business relationship. The term is also used to refer to the bank…

One of three flexibility mechanisms set out in the Kyoto Protocol to help countries with binding greenhouse gas emissions targets (the Annex I countries) meet their treaty obligations.

The interest which is due on project financing loan facilities during the construction period, but which cannot be paid since the Borrower is not generating cash. This interest is generally added to the loan or “capitalised”. IDC is in effect therefore a cost of construction.

An agreement between / among the main creditors of a project Borrower governing the relationships among those lenders in respect of the borrower’s obligations. Typically such an agreement will contain provisions regarding matters such as: Common terms Order of drawdown Cashflow waterfall Limitation on ability of creditors to vary their…

Usually the largest part of the equity funding injected by the Sponsors into the SPV. For the Inter-Company Loans to be treated as Equity by the lenders, they will need to be subordinated to the debt provided by the external lenders.