Project Finance Clause Samples

Project Finance. A method of funding in which the lender looks primarily to the revenues generated by a single project, both as the source of repayment and as security for the exposure. Repayment depends primarily on the project’s cash flow and on the collateral value of the project’s assets, such as power plants, chemical processing plants, mines, transportation infrastructure, environment, and telecommunications infrastructure;

Project Finance. Following the Closing, the CZH Holders may by notice in writing request SolarMax China to use commercially reasonable efforts to arrange for project financing on behalf of the Company on such terms as the Company may determine to be reasonable, based on the tasks required for identifying, planning, and procuring certain capital intensive solar projects, and in all cases, subject to the final terms of usual and customary definitive documents negotiated with SolarMax China, the Company and/or any other counterparties and subject to a project budget proposed by the CZH Holders and subject to SolarMax’ and any proposed lenders’ approval. For the avoidance of doubt, it is understood that any project financing will be subject to negotiation of financing and this Agreement does not confer upon any Party or the Company any right to obtain financing from the Company and none of SolarMax, SolarMax China or the Company shall have any obligation whatsoever to provide access to funds or direct financing to the CZH Holders (including Affiliates of CZH Holders and third party transferees) under this Agreement.

Project Finance. Subject to (i) the terms and conditions of the ABL Credit Facility and (ii) approval by lenders holding at least 75% in principal amount of the Refinanced Loan, CPC permitted to (x) form a wholly-owned special purpose subsidiary and (y) transfer thereto certain assets (including fixed assets) to be agreed upon (the “Specified Assets”) of CPC (which assets shall thereupon be released from the liens securing the Refinanced Loan), for the purpose of enabling CPC to cause to be incurred by such special purpose subsidiary project financing and equipment financing indebtedness to be used to fund the purchase or acquisition of assets utilized solely in furtherance of the growth of CPC business lines to be agreed upon. All of the equity interests and other assets in such special purpose subsidiary shall be pledged to secure the Refinanced Loan, subject to the liens securing each of the applicable project financing, the ABL Credit Facility and the Senior Secured Term Loan.

Project Finance. (a) The Lessee may hypothecate, create charge, or create mortgage or other encumbrances for the limited purpose of raising funds for the Project in favour of a bank or financial institution, for securing any amount and payable by it to such bank or financial institution. Provided, however, all such hypothecations, charges, mortgages, charges or encumbrances shall be subject to the rights of the Lessor under this Lease Deed, the RFP Documents and any modification or amendment thereof. It is specified that all such funds raised shall be deposited in an escrow account with the sole purpose of use of such funds implementation of the Project. It is agreed that the Lessor shall have first charge on the Hotel Premises at all times during the Term. (b) The Lessee undertakes to intimate the Lessor the details of finance(s) raised on the security as set out above within 7 (seven) days from the date of signing of the definitive documents in relation to such financing. In the event of any default by the Lessee under the terms of the loan with the bank of financial institution, the Lessee shall intimate the Lessor, in writing, within 24 (twenty four) hours along with relevant documents. (c) The bank or financial institution which finances to the Lessee for the Project, shall inform the Lessor the details of finance(s) from time to time till the loan(s) is/are repaid by the Lessee and also comply the terms and conditions of no objection certificate, issued by the Lessor on the request of the Lessee and the bank or financial institution.

Project Finance. Each Obligor shall not, and the Company shall cause each of the PGS Subsidiaries which is not an Obligor not to, invest in or extend any loans or any other form of credit or grant any guarantee or indemnity to, or for the benefit of, any Project Company or a Project or otherwise voluntarily assume any liability, whether actual or contingent, in respect of any obligation of any Project Company or Project; provided that such investment, loans, credit guarantee, indemnity or other liability shall be permitted in an amount not to exceed the sum of: (i) the proceeds from any issuance of equity securities made by the Company after Issue Date (which, for the avoidance of doubt, shall not include the securities of the Company issued in connection with the Restructuring); plus (ii) 50% of the accumulated Consolidated Net Income of the Group on an after tax basis for each fiscal year beginning with the fiscal year ended December 31, 2004 less any dividends declared by the Company during the period of accumulation; plus (iii) until the earlier of (a) the third anniversary of the Issue Date, or (b) repayment in full of the Senior Notes due 2006, US$100,000,000 and after and including that date, an amount of US$200,000,000 in aggregate.

Project Finance. 3.1 The parties acknowledge that the Recipient will seek to arrange: (a) concessional debt financing and related working capital and hedging facilities; and (b) an equity raising, in addition to the ARENA Funding in relation to the funding of the Project. 3.2 In the event that the finance described in clause 3.1 is arranged, the parties agree to negotiate in good faith any amendments to this Agreement reasonably required as a result of such finance being obtained, including (if required) entering into a longform funding agreement.

Project Finance. What is Project Finance? Project finance refers to the financing of a project company by equity investors and lenders based on (a) the projected (contractual) cashflows of the project and (b) the underlying power asset value. Project financing is typically limited or non-recourse, i.e. the lenders have recourse to the project company and the assets of the project itself, but they have limited

Project Finance. 10.7.1 The Concessionaire is not allowed to hypothecate, create charge, or create mortgage or other encumbrances for any purpose excluding raising funds for the Project subject to the clause below. 10.7.2 It is hereby clarified that the Concessionaire has been provided the right to mortgage the land of 3.70 acres for availing institutional loan only for the explicit purpose of construction of 5-star hotel at this site, subject to the NOC being obtained by them from the Licensing Authority. The Licensing Authority will take adequate safeguards to ensure continued ownership/leasehold of the site without any encumbrances before issuance of such NOC. The Concessionaire irrevocably will not have any right or remedy which they may have at any stage at law or howsoever otherwise arising to challenge or question the decision taken by the Licensing Authority in this context

Project Finance. Even where large corporate developers potentially have access to low-cost capital funding, they may still prefer to develop this type of project using limited or non-recourse financing to ensure that the loan facility does not feature on the balance sheet. It may also be more attractive to lenders to lend to new SPVs, as such entities are unencumbered with existing liabilities. For the reasons highlighted above, project finance has been the most common financing approach for large-scale power projects in emerging markets in the last two decades. An analysis should always be made as to whether this is the right financing approach for a specific project, but once the decision is made to go forward with a project finance structure, the concerns of lenders should be considered while negotiating the terms of the PPA to ensure the successful completion of the project. An offtaker without insights into the lenders' expectations will be at a significant disadvantage during the project negotiations. Although most parts remain relevant for a project financed on the developer's balance sheet, this book assumes that the PPA is negotiated in a project finance context. For a more detailed exploration of other financing structures, including host-country financing, as well as respective strengths and weaknesses of these alternatives, you may refer to the handbook Understanding Power Project Financing.