Glossary

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.