Bridge Finance Funding Conditions
The information below can be used to guide potential borrowers about the nature of Leapfrog Bridge Finance funds.
Who we can lend to
Due to our specific facility agreement, we can only lend to parties who meet all of the specific criteria below:
- Entities incorporated, based and delivering their social purposes in the UK
- The entity’s objects are primarily concerned with delivering social and environmental impact
- The entity has an asset lock or similar restriction on the distribution of its assets.
- Leapfrog Finance adheres to the Responsible Business Principles and can only lend to entities which do so too.
The range of technologies we are able to fund include:
- Solar PV – ground-mounted and roof-mounted
- Batteries in conjunction with generation
- Heat networks
- Energy efficiency measures
- Wind turbines
- Heat pumps
- Micro hydro turbines
- Wood-fuelled boiler systems
- Other renewable energy technology deemed by our Investment Committee to be sufficiently proven and with a social impact potential.
Minimum and maximum loan size
To provide assurance to investor’s that their funds can be repaid in a timely manner, the due diligence set out below is required.
As a result of the costs that will be incurred by the borrower through the due diligence process below, small loans (less than £500k) tend to be disadvantaged and we recommend you seek other sources of finance for these projects.
In general our preferred maximum exposure per investment is £6m. However, depending on the nature of the investment, we are prepared to consider higher amounts.
The following due diligence forms part of our process (not in specific order):
- Financial due diligence – modelling of the project to ensure it is financially viable, robust in the face of change and able to support expected levels of debt and equity.
- Structuring – As part of our lending process, we consider the operating structure for an asset that will best generate benefit for the community.
- Legal due diligence – This will encompass legal review of powers, structures, property rights and security as well as preparation of finance documents.
- Technical due diligence – We require an independent technical review of a project to ensure it is technically viable, safe and capable of delivering the predicted financial returns.
- Investment Committee review and approval – Our independent experts on the Investment Committee review proposed investments and must provide approval at each stage of the process.
- Social & Environmental Impact due diligence – the centrality of environmental and social impact means that we will undertake a detailed review both of the potential borrowers impact intentionality and capability to deliver as well as the proposed impact plan for community benefit funds.
- This process therefore comes with some cost which will be a part of the loan set up. There is additionally a small arrangement fee as well as an admin and monitoring fee.
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