This application is for ONE project seeking a minimum of 250 million US Dollars. To proceed with your project funding inquiry, you must provide detailed project information and proof of bankable collateral. Please review the Guidance Notes below for acceptable collateral forms and project eligibility criteria. Incomplete submissions or those lacking collateral details will not be reviewed. This is important as the Lenders will determine if the project is eligible for financing based on your form submission.
GUIDANCE NOTES:
How to Complete the Form:
Before Completing The Form: Before starting your application, carefully read these Guidance Notes together with Our Process and Finance Products range to ensure a thorough understanding of the Initial Project Assessment process.
Completing the Form: To initiate your finance inquiry, please fill out our Initial Project Assessment Form with detailed information about your capital request:
- Begin by selecting the appropriate inquiry type—Project Finance1, Private Trading, or Gold transaction—to direct your application to the right department.
- Fill out the form with precise, detailed information about your project, answering all questions.
- Collateral Information: Clearly outline the form of collateral2 or cash collateral3 you can provide, as described below.
- Attach key supporting documents that provide an overview of your project and its financial aspects:
- Project Executive Summary
- Feasibility Studies and Appraisals
- Proof of Collateral
- Long-term Contracts or Offtake Agreements
- Do not combine multiple projects. Each project must be submitted on a separate application form.
Initial Project Assessment: The completeness and quality of your responses are vital for our assessment.
FORM SUBMISSIONS THAT DO NOT INCLUDE ANSWERS TO THE ABOVE QUESTIONS WILL NOT BE PROCESSED.
This because the information requested is crucial for lenders to evaluate your project’s eligibility for funding.
Response to Submission: If your project does not meet the funding criteria, you will be notified that the project has been declined. If the project is eligible for finance, we will contact you with the next steps.
ELIGIBILITY REQUIREMENTS:
- Location: Projects must be located in prime locations in a country with investment-grade status and low AML (Anti-Money Laundering) risks.
- Ask: between $250,000,000 (USD) and $5 billion or more in private debt project finance.
- Collateral:
- Must be of at least 20% of the CAPEX, be liquid, and have a verifiable current market value.
- Collateral must be investment-grade bankable and receive a rating of AAA or AA from Moody’s, Standard & Poor’s (S&P), or Fitch.
- Hard assets (e.g., personal assets or real estate) cannot be primary collateral due to foreclosure and repossession challenges outside of the US jurisdiction, but may enhance creditworthiness.
- Additionally: projects should have long-term offtake and feedstock agreements with established companies that hold investment-grade ratings or blue-chip status.
- Our non-bank lender may consider various forms of collateral4. Please see the acceptable collateral forms below.
Please note that all projects must have collateral to pass the Initial Project Assessment.
ACCEPTABLE COLLATERAL FORMS:
Acceptable Cash Collateral Forms for Private Debt Loans:
- Cash and Cash Equivalents: Cash, Bridge Loans, and Letters of Credit (investment-grade).
- Bank Instruments: Standby Letters of Credit (SBLCs) and Bank Guarantees (BGs) from major banks.
- Debt Instruments: Corporate Bonds, U.S. Treasuries, Government Bonds, Municipal Bonds, and Sovereign Bonds.
- Note: All instruments must be actively trading in recognized markets for liquidity and valuation.
- Corporate and Sovereign Guarantees: Investment-grade guarantees provided by corporations or sovereign entities.
- Investment Portfolios: Traded securities, bonds, commodities, and liquid cash portfolios.
- Offtake Agreements: Long-term agreements with established, creditworthy counterparties.
- Commercial Real Estate (CRE): income-producing real estate properties in the USA, UK, Canada or Australia, such as resorts and hotels with established operating agreements with international hotel chains.
- Bitcoin
Please note that collateral acceptance is at the discretion of the Lender. All collateral forms must be liquid, have a verifiable market value, and are assessed for alignment with lender-defined standards for liquidity and risk.
Credit Enhancements, Future Contracts, Insurance Guarantees are acceptable as enhancements, not primary collateral.
Acceptable Collateral Forms for Trading:
For Private Placement Trades, in addition to the collateral forms for private debt loans, the Trade Desks accept a broader range of assets including:
- Precious Metals: Gold, Copper, Palladium
- Precious Stones: Diamonds and similar high-value assets
- Commodities: such as Sugar
- Unencumbered Hard Assets: Evaluated on a case-by-case basis
Please note that collateral acceptance is at the discretion of the Lender or Trading Desk. While these additional forms of collateral allow for greater flexibility and more options for leveraging physical assets, they are evaluated individually to align with Trading Desks’ risk management and investment criteria.
PROJECT ASSESSMENTS AND FINANCING:
Only premium projects make it through to the term sheet. They are usually located in prime locations in the USA, Canada, and the UK, have long-term purchase/sale agreements, such as PPA, SPPA, or other types of offtake agreements, with investment-grade ratings, have a value of $250 million or more, and income-producing real estate properties in the US, such as resorts and hotels with established operating agreements with international hotel chains.
Lenders obtain funds for their financing model from investment banks through the placement of structured notes or from lenders’ own sources. The notes must have an investment grade, which is determined by the underlying assets such as projects and their investment grade collaterals. Lenders can provide full financing for such “premium projects” with premium investment grade.
We Do NOT Provide:
AltFin does not engage in the following services or activities:
- Financial Transactions: Securities transactions, capital raising, hedge fund transactions, and securities trading.
- Management Services: Asset management, wealth management, financial management, or fund management.
- Specialized Financing: Venture Capital (VC), capital risk investment, bridge financing, financing of distressed assets or operations.
- Trading Activities: Commodities trading.
- Regulatory Scope: We are not broker-dealers as defined by SEC regulations. We are not tax, investment, or financial advisors, and we are not licensed or regulated by the FCA.
DISCLAIMER:
AltFin.net, Lenders and their Advisors are not a United States Securities Dealer, wealth manager, advisor, banker, securities trader or registered broker-dealer and follow under the SEC Reg D Exempt Criteria. This form and its contents, verbal and written communications are not a solicitation or a securities offering under SEC Regulation. AltFin is not licensed or regulated by the Financial Conduct Authority (FCA) and does not offer investment, tax, or financial advice. This website and its content including this form is for informational purposes only. Read the full Disclaimer in the footer.
TERMINOLOGY EXPLAINER:
1. What is Project Finance?
Project finance involves funding public services, industrial projects, and long-term infrastructure through a non-recourse or limited recourse financial structure. This method typically combines equity and debt, with repayment coming from the project’s generated cash flow.
A key advantage of project financing is its off-balance-sheet nature, ensuring no impact on the credit of shareholders or government contracting authorities. It also transfers risk to the lenders, who may receive higher margins as a result.
Project finance is also commonly applied in sectors like mining, oil and gas, construction, and building projects. Ordinarily, the finance is composed of debt. The capital stack determines the hierarchy of different financing sources. Senior and subordinated debts are classified according to their position in a business’ capital stack.
2. What is Collateral?
Collateral is an asset that serves as security for project finance loans provided by the lenders. Collateral is an item of value that is utilized to secure the project financing, which is essentially the loan.
Each project may have different forms of collateral, and the lenders may utilize various collateral forms to fund the entire project and provide 100% of the project funding (namely, the whole capital stack).
The purpose of collateral is to protect the lender, and it serves as a form of security in case of default by the project or borrower. In the event of default, the lender can seize the collateral to recover its losses. Collateral adds validation to the project and increases the chances of its success while minimizing the lender’s risk.
3. What is Cash Collateral?
Cash Collateral refers to cash or cash-equivalent assets (such as highly liquid securities) that are set aside or pledged as security for a financial obligation. This arrangement ensures that the party receiving the collateral has access to funds if the other party fails to meet its obligations. It is commonly used to reduce credit risk by providing an accessible form of compensation in case of default.
In financing, borrowers may pledge cash collateral to secure loans or credit facilities, and in project finance, it can serve as a guarantee for performance, payment obligations, or as part of escrow arrangements. In trading, cash collateral ensures the performance of contracts, particularly in derivatives or securities lending, where it might be required as margin.
It is typically held in a separate account, such as an escrow or designated collateral account, and may earn interest depending on the terms. Governed by agreements like loan documents or International Swaps and Derivatives Association (ISDA) agreements, cash collateral is considered a low-risk security measure due to the liquidity and stability of the assets involved.
4. How does Collateral Work?
Before providing finance, the lenders need to ensure that the project can repay the loan and safeguard the lender’s interests. Collateral is required as a form of security to protect the lender’s funding.
In situations where there are no initial assets, such as during the construction phase of a project, temporary collateral may be utilized to ensure that the borrower meets its financial obligations until the project is completed. This guarantees that the project will be able to repay the loan and protects the lender’s investment.
Collateral can come in various forms depending on the nature of the project finance loan. A commercial property mortgage, for instance, may require collateral in the form of the property itself. In some cases, institutional credit may be used as security, provided by a credit-worthy co-signer or borrower with a credit rating from Moody’s, S&P, or Fitch. For project finance loans, collateral typically includes the pledge of interest in the credit-worthy borrowing group, as well as all the assets associated with the project.