In3 Completion Assurance Program™ (CAP funding) – project proposal builder

Description

This “proposal builder” includes everything Project Developers and Sponsors need to pre-qualify and secure advantageous project funding of $25 million or more ($50m+ preferred), up to 100% of the budget requirements.

For how CAP works, a 3-stage process outlines the steps, reflected in Item 2, below.
To start, focus on Stage 1, “Apply & Pre-Qualify” to satisfy CAP’s conditions.

Take this action first — download the guarantee instrument and fill in specifics

START HERE:  Once we have an indication that the project or portfolio is qualified ($25M or more, in almost any sector, at any stage, anywhere; more), we ask that you or your guarantor (sponsor) Email us a draft of the proposed, fill-in guarantee verbiage (the instrument’s exact wording) in the bank’s preferred format.  In other words, your mission is to download and prepare the Instrument Verbiage using the appropriate MS Word template for the financial (completion assurance) guarantee instrument type you select.  Which one?  Start with the BG/SbLC unless otherwise recommended here.

INSTRUCTIONS at-a-glance: Download then modify the Word file to reflect the verbiage (fill in the bank’s address, highlighted areas, including the face value, and contact information, or ask them to so) that will be later signed and sent once everyone’s mutual Know Your Customer (KYC) protocols are satisfied (see article on mutual safety checkpoints), and funding terms have been finalized and contractually arranged.  There’s no risk or cost associated with this initial pre-qualification step. It is non-binding.  

Complete, step-by-step instructions for securing your guarantee

Once this unsigned draft copy of the instrument verbiage gains approved by us (the Family Office’s funding bank), we will then request the remaining items to fully pre-qualify your proposal for funding, including a Bank Letter (usually a “Ready, Willing & Able” or RWA letter, definition) as evidence that the issuing bank will do its part when the time comes. That milestone — sending the “operative” instrument — is the last step before reaching Financial Closing, once all contracts are entered for the project’s funding.

To keep the bigger picture in focus, bankers can refer to our “Inception to Completion” roadmap (1-page PDF), a technical overview of how this initial “Apply & Qualify” stage works, or scan the Q&A points below

To help guide this, you may wish to use our Pre-qualification Worksheet (2-page PDF version) or MS Word worksheet, available upon request. The worksheet is optional, but most of our clients have found the structure helpful.  Download and see for yourself.  Our new Onboarding System (still in beta) will soon take its place.

Guarantee Instrument Templates (downloadable, MS Word format)

Quick Q&A:

• Why does In3 use financial guarantees for project funding and what are the advantages of this innovative approach?
• Which type of guarantee instrument is best?  Short answer:  If you have access to the Minister of Finance for a country that still issues Sovereign Guarantees, explore that first, as SGs are effectively free to developers. Otherwise, start with the Bank Guarantee/SbLC, and if you run into any of the challenges listed in the AvPN article, then consider a company-issued, bank-endorsed Promissory Note as a backup plan.

Related: Why Financial (“completion assurance”) Guarantees for project funding make ALL the difference

• How can we obtain a Completion Assurance Guarantee Sponsor?  For development companies lacking balance sheet depth, a “sponsor” (supporter, backer, credit enhancer) can be invited, starting with any parties that have or could have an interest in seeing the project come together.  Here’s how that works.
  • Introduction for “at large” guarantee sponsors (landing page)
  • 1-page Overview for CAP Guarantee Sponsors (PDF)

To avoid delays, use the following resources to prepare your funding proposal documents, so they are ready and available upon request. PLEASE DO NOT SEND YOUR PROJECT BUSINESS PLAN.  We won’t read it for now.  We only require the first 4 of these Six Essentials to start.

Phase 1 Milestone to reach Financial Closing

Upon receipt of an RWA Letter from a qualified (rated) bank, we will put a binding offer on the table and usually reach financial closing within 2-4 weeks.  First monthly draw (transfer) of funding occurs at most 30-45 days later.

1. Orientation:  Developer Briefing “tear sheet” presents and explains CAP funding to assist with understanding the advantages, benefits, qualification procedure and most of the tools and resources described below.
   1. What in the world is a “Financial Guarantee”?  How is that different than a Loan Guarantee?  Definition
   2. View Animated presentation online (Google doc)
   3. Register to access Video of Webinar (recorded August 2020), or
   4. Download flat PDF (best viewed open in Acrobat).
2. How does it work:  3-stage Protocol (PDF summary sheet).  Note:  Once the guarantee verbiage and drawdown schedules are pre-approved, a bank’s letter of intention (RWA letter, typically) begins our formal due diligence, as mentioned above, which is necessary to receive a binding offer.  We provide vetting and due diligence without cost so you haven nothing to lose.  We only ask that you read carefully to ask reasonably informed questions.
   Also available: step-by-step, our 3-stage/gate protocol, as a 14-minute video, “Why CAP and How It Works” — explains the business logic and mutual protections in bite-sized chunks.
3. How to create a Monthly Draw Schedule and Sources & Uses Statement (PDF, sample draw schedule on pg. 3)
4. In3’s Financial Model template (MS Excel template available to qualified clients upon request).
   Upholds IFRS and GAAP, and can help standardize financial pro forma projections, saving time with organizing key preliminary deliverables for gaining pre-approval: Uses of Funds table, Monthly Draw schedule (see #3, above), and Project IRR.
5. Financial Model Instructions (PDF, 5 pgs.)
6. Checklist of items you need to pre-qualify in stages: download 2-page worksheet
7. How to get a project guarantor on board:  3-page whitepaper

If you already know your project is pre-qualified, register using our tracking system at in3finance.com/apply. Once received, we will review and revert with any questions.

NOTE:  If you were introduced by an In3 Affiliate, please use the Lead Source field (or ask your Affiliate to register your project for you) and indicate “Registered In3 Affiliate” for that item.

ADDITIONAL RESOURCE MATERIALS
CAP Resource Library:  In3Capital.net/resources

1. Information Highlights for the Completion Assurance (financial guarantee) Program:
   1. CAP funding synopsis
   2. More stepwise approach to preparing the Basic CAP Information needed to pre-qualify
   3. Legal venue:  Why we use URDG ICC Pub No 758 (actually better for the developer!): synopsis; Practitioner Series (advanced, fulsome) article
   4. CAP funding Frequently Asked Questions (FAQ)
   5. More fundamental FAQs like “Do you charge up-front fees?” or “What’s a ‘sponsor’?” (all FAQs).
   6. Guarantee Fundamentals FAQ — Are you new to Financial Guarantees for Project Funding? (download this free 4-pg PDF)
   7. What are In3’s motivations?  Are we aligned with your purpose?  In3 Investment Strategy

      Did we miss what you need?  Ask us

2. Tools & Resources to help expedite — available upon request to qualified developers
   1. Mutual Non-disclosure & Non-Circumvention Agreement (Word template available upon request).
   2. EPC / General Contractor Sponsor Briefing — This set of MS PowerPoint slides can be used by developers, tailored to the target audience, for a sponsor to bring BG/SbLC or APN.
   3. Redacted sample EPC agreement (MS Word) with paragraph 8.6 that defines the BG/SbLC or paragraph 8.7 that provides the APN verbiage as a template for your EPC contract negotiations.
   4. Expression of Interest (EOI) letter or LOI available from In3’s side for qualified projects.
      Affiliates: please fill this out on behalf of a qualifying client’s project and send it back for review/modifications/signature.  This EOI/LOI includes reference to basic funding terms.

What else would help you to better understand and expedite your funding?

Contact us or you may also call us at +1.831-761-0700 and select Ext. 1 to ask your question(s).