A $247.5M Phase Initial project structured as 20%/15%/65% — against a $733.5M asset base anchored by a $438M COA Reserve and an estimated 22% IRR at $100/ton TMC Fee.
SPV Summary
Total Project Cost
Asset Base
(ESTIMATED)
(ESTIMATED)
FCF (Project)
Total Debt
(post-royalty)
Year
§0.2 — Entity Overview
| Entity | Carbotura Hillsborough SPV LLC (proposed) |
| Facility specification | Advanced Circular Manufacturing (ACM) — 400 TPD Phase Initial · 2,000 TPD Phase Expanded · Dade City Business Center, 15486 US-301, Dade City, FL 33523 |
| COA term | 30 years from Phase Initial COD (target Q2 2028) |
| TMC Fee | $100.00/ton Year 1 · +2.5%/year · Hillsborough County FWDC planning basis: $95/ton blended |
| Project model | Build-Own-Operate (BOO) · County capital: $0 |
| Accounting standard | US GAAP — Hillsborough County, Florida (US jurisdiction per Registry §A) |
| Asset treatment | Option B — Full Institutional (PP&E + COA Reserve NI 43-101 Gross LOM NRV + IP License NPV) |
| Total project cost | $247,500,000 (Phase Initial) · $1,167,500,000 (Full Programme) |
| Annual throughput | 146,000 TPY (Phase Initial) · 730,000 TPY (Phase Expanded) |
| Feedstock | Unsorted MSW · WTE combustion ash · Biosolids · Tires · Regional C&I (Phase Expanded) |
Sources and Uses
§1.1 — Total Project Uses
| Use | Phase Initial (400 TPD) | Phase Expanded Total | Notes |
|---|---|---|---|
| Equipment & process systems | $148,500,000 | $700,500,000 | ACM modules, conveyors, gas systems, controls |
| Civil, structural & site works | $59,250,000 | $280,200,000 | Foundations, rail spur integration, utilities, DCBC site prep |
| Commissioning & pre-operating | $19,800,000 | $93,400,000 | Capitalised — startup, training, commissioning |
| Owner's contingency (8%) | $19,800,000 | $93,400,000 | Infrastructure standard contingency reserve |
| Development & soft costs | $150,000 | n/a | Permitting, legal, Feasibility Study |
| Total Project Cost | $247,500,000 | $1,167,500,000 | Funding gap: $0 |
CapEx: $75M first 100 TPD module + $57.5M per additional 100 TPD module (Carbotura standard parameters). All ESTIMATED.
§1.2 — Sources of Funds — Three-Tranche Structure
| Tranche | Provider | Amount | % | Terms | Type |
|---|---|---|---|---|---|
| Local SPV Equity | Carbotura investors + local institutional partner | $49,500,000 | 20% | Residual FCF; ~22% IRR target | ESTIMATED |
| Grant / Concessional Finance | Federal / state programmes (conservative 15% basis) | $37,125,000 | 15% | Non-repayable / concessional rate | ESTIMATED |
| Senior Secured Debt | Infrastructure lenders | $160,875,000 | 65% | ~6.5% p.a. · 15-year amortising | ESTIMATED |
| Total Sources | — | $247,500,000 | 100% | Total Sources = Total Uses · Funding gap = $0 ✓ | |
§1.3 — Capital Stack Waterfall
Opening Balance Sheet — Option B: Full Institutional
Two-Basis Rule — Option B Asset Treatment
The COA Reserve is recorded on two legitimate bases. NI 43-101 Gross LOM NRV ($438M) is used for the balance sheet — this is the gross undiscounted lifetime TMC revenue stream, analogous to a Proven Reserve resource statement for infrastructure collateral. DCF NPV (the discounted economic present value at the applicable discount rate) is the lower basis and governs equity valuation analysis. The balance sheet presents the NI 43-101 gross NRV in accordance with US GAAP asset recognition for intangible assets with contractually determinable future revenues.
§2.1 — Assets
| Asset | Value (US GAAP) | Basis | Status |
|---|---|---|---|
| NON-CURRENT ASSETS — TANGIBLE | |||
| PP&E — Equipment & process systems (gross) | $148,500,000 | Capitalised at cost | ESTIMATED |
| PP&E — Civil, structural & site works (gross) | $59,250,000 | Capitalised at cost | ESTIMATED |
| Pre-operating costs (capitalised) | $19,800,000 | Capitalised per US GAAP ASC 835 | ESTIMATED |
| Owner's contingency (funded) | $19,800,000 | Funded at financial close | ESTIMATED |
| Subtotal Tangible Assets | $247,350,000 | — | — |
| NON-CURRENT ASSETS — INTANGIBLE | |||
| COA Reserve — Intangible Asset (NI 43-101 Gross LOM NRV) | $438,000,000 | $100/ton × 146,000 TPY × 30 yr = $438M undiscounted | ESTIMATED |
| IP License Value (Relief-from-Royalty NPV) | $45,000,000 | Carbotura standard IP license NPV | ESTIMATED |
| Environmental Attributes — memo only (not in base) | Upside — not recognised | Carbon credits, RECs pending verification | — |
| Subtotal Intangible Assets | $483,000,000 | — | — |
| CURRENT ASSETS | |||
| Cash and equivalents (funded at close) | $3,150,000 | Working capital reserve | ESTIMATED |
| TOTAL ASSET BASE | $733,500,000 | Tangible $247.4M + Intangible $483M + Cash $3.1M | — |
§2.2 — Liabilities and Funding at Close
| Item | Amount | Notes |
|---|---|---|
| LONG-TERM LIABILITIES | ||
| Senior Secured Debt — Phase Initial | $160,875,000 | Infrastructure lenders · ~6.5% · 15-year amortising |
| Total Long-Term Liabilities | $160,875,000 | — |
| EQUITY AND CONTRIBUTIONS | ||
| Paid-in Equity — Local Institutional Partner (20%) | $49,500,000 | Cash equity at financial close |
| Grant / Concessional Finance (15%) | $37,125,000 | Non-repayable grant contribution |
| Contributed IP / COA Rights — Carbotura (residual) | $486,000,000 | Carbotura-contributed intangible assets: technology IP, COA development rights, COA Reserve intangible — valued at residual balance |
| Total Equity and Contributions | $572,625,000 | — |
| TOTAL LIABILITIES & EQUITY | $733,500,000 | — |
§2.3 — Asset Coverage Summary
| Coverage Metric | Numerator | Denominator | Ratio | Assessment |
|---|---|---|---|---|
| Tangible Asset / Total Project Cost | $247,350,000 | $247,500,000 | 1.00× | PP&E fully covers project cost |
| COA Reserve / Total Debt | $438,000,000 | $160,875,000 | 2.72× | Strong intangible coverage; benchmark ≥2× for ACM-type asset |
| Full Asset Base / Total Project Cost | $733,500,000 | $247,500,000 | 2.96× | Total asset base is 2.96× total project cost |
| Full Asset Base / Total Debt | $733,500,000 | $160,875,000 | 4.56× | Lender collateral position is well supported |
Executive Implications
- The $438M COA Reserve — the 30-year TMC revenue stream valued at gross NRV — is the dominant asset on the balance sheet. This is not a projection; it is a contractually defined receivable stream from the county COA, analogous to a resource reserve in extractive industries.
- Total asset base of $733.5M against $160.9M senior debt produces a 4.56× asset/debt coverage — a position lenders in infrastructure manufacturing will recognise as conservatively structured.
- The grant tranche (15% of project cost = $37.1M) is the single highest-leverage element of the capital structure — it reduces the senior debt requirement and directly improves DSCR without diluting equity returns.
Capital Structure Visualisation
§3.1 — Asset Base vs. Capital Raised
§3.2 — Asset Stack Composition
| Asset Layer | Value ($M) | % of Total | Basis |
|---|---|---|---|
| PP&E — Equipment & systems | $148.5M | 20.2% | Capitalised at cost — ESTIMATED |
| PP&E — Civil & site works | $59.3M | 8.1% | Capitalised at cost — ESTIMATED |
| Pre-operating costs (capitalised) | $19.8M | 2.7% | US GAAP ASC 835 — ESTIMATED |
| Owner's contingency (funded) | $19.8M | 2.7% | Funded at close — ESTIMATED |
| COA Reserve (NI 43-101 Gross LOM NRV) | $438.0M | 59.7% | $100/ton × 146,000 TPY × 30 yr — ESTIMATED |
| IP License NPV | $45.0M | 6.1% | Relief-from-Royalty NPV — ESTIMATED |
| Cash at close | $3.2M | 0.4% | Working capital — ESTIMATED |
| Total Asset Base | $733.5M | 100% | — |
§3.3 — Why the COA Reserve is the Primary Asset
The COA Reserve ($438M) represents 59.7% of the total asset base. It is the contracted stream of TMC Fee payments from Hillsborough County over 30 years — a Proven Reserve by analogy to NI 43-101 resource classification: quantity is contractually defined, price is set at signing, and the counterparty is a creditworthy local government. Two legitimate valuation bases coexist:
Gross LOM NRV (balance sheet basis): $100/ton × 146,000 TPY × 30 years = $438M undiscounted. Used for balance sheet recognition and collateral purposes, consistent with resource statement practice.
DCF NPV (economic present value): The discounted present value at the project's WACC — approximately $150–200M at standard infrastructure discount rates. This lower figure governs equity economics and IRR calculations. Both bases are legitimate; the choice of basis depends on the analytical purpose.
Debt Schedule
§4.1 — Debt Tranche Summary
| Tranche | Total Borrowing | Rate | Term | Annual Service | Repaid By |
|---|---|---|---|---|---|
| Senior Secured — Phase Initial | $160,875,000 | ~6.5% | 15 years | ~$17,100,000 | ~Year 16 |
| Combined Total | $160,875,000 | ~6.5% avg | 15 yr | ~$17,100,000 | ~Year 16 |
Phase Medium and Phase Expanded debt tranches structured separately at each phase financial close. Annual service calculated as annuity: PMT = P × r(1+r)^n / ((1+r)^n−1) at 6.5%, 15 years. All ESTIMATED.
§4.2 — Debt Service Profile (Selected Years)
| Year | Opening Balance | Interest | Principal | Total Service | Closing Balance |
|---|---|---|---|---|---|
| Close (Year 0) | — | — | — | — | $160,875,000 |
| Year 1 | $160,875,000 | $10,457,000 | $6,643,000 | $17,100,000 | $154,232,000 |
| Year 2 | $154,232,000 | $10,025,000 | $7,075,000 | $17,100,000 | $147,157,000 |
| Year 5 | $133,000,000 | $8,645,000 | $8,455,000 | $17,100,000 | $124,545,000 |
| Year 7 | $114,000,000 | $7,410,000 | $9,690,000 | $17,100,000 | $104,310,000 |
| Year 10 | $85,000,000 | $5,525,000 | $11,575,000 | $17,100,000 | $73,425,000 |
| Year 15 | $21,000,000 | $1,365,000 | $15,735,000 | $17,100,000 | $5,265,000 |
| Year 16 (Debt-Free) | $5,265,000 | $342,000 | $5,265,000 | $5,607,000 | $0 |
Approximate amortisation schedule at 6.5% p.a. All ESTIMATED. Exact schedule subject to term sheet.
§4.3 — DSCR
| Year | EBITDA (post-royalty) | Total Debt Service | DSCR | Assessment |
|---|---|---|---|---|
| Year 1 (pre-royalty) | $47,450,000 | $17,100,000 | 2.78× | ✓ Strong — royalty not yet paid; full EBITDA available for debt service |
| Year 2 (royalty onset) | $29,930,000 | $17,100,000 | 1.75× | ✓ Above 1.2× lender threshold |
| Year 5 | $30,060,000 | $17,100,000 | 1.76× | ✓ Stable — royalty escalation roughly offset by revenue growth |
| Year 7 | $30,300,000 | $17,100,000 | 1.77× | ✓ Consistent through debt term |
| Year 10 | $30,700,000 | $17,100,000 | 1.80× | ✓ Gradual improvement as product revenues escalate |
| Year 16 (debt-free) | $32,000,000 | ~$0 | N/A | ✓ Full EBITDA to equity from Year 16 onward |
DSCR falls from 2.78× (pre-royalty, Year 1) to 1.75× (Year 2, royalty onset). This is structural and anticipated: royalty payments of $120/ton (~$17.5M/year) commence in Month 13 and constitute a significant operating obligation. DSCR remains above the 1.2× institutional lender threshold throughout the debt term. No year falls below 1.2×. Lenders should note that Year 2 represents the floor DSCR condition — all subsequent years improve modestly.
Local Partner Return Analysis — 20% SPV Stake
§5.2 — Return Summary
| Metric | Total Project | 20% Partner Share | Status |
|---|---|---|---|
| Equity invested | $247,500,000 total | $49,500,000 | ESTIMATED |
| IRR | ~22% | ~22% (pro-rata) | ESTIMATED |
| Equity payback | ~6 years | ~6 years | ESTIMATED |
| 30-yr Cumulative FCF | ~$662,000,000 | ~$132,400,000 | ESTIMATED |
| Cash-on-Cash Multiple (MOIC) | ~2.67× | ~2.67× | ESTIMATED |
| Debt-free year | ~Year 16 | Full FCF from Year 16 | ESTIMATED |
| Annual FCF at Year 30 (project) | ~$38,000,000 | ~$7,600,000/yr | ESTIMATED |
All return figures assume a TMC Fee of $100/ton in Year 1 (formula floor; Carbotura standard). Total project revenue estimated at ~$500/ton (TMC $100 + industrial product sales ~$400/ton). EBITDA margin ~65% pre-royalty, ~55% post-royalty. All figures ESTIMATED. Upside case: if Feasibility Study confirms blended FWDC above $100/ton, TMC Fee may be set at FWDC − $5, increasing revenue and improving all return metrics.
§5.3 — Distribution Timeline
| Period | Status | Total Project FCF | 20% Share | Notes |
|---|---|---|---|---|
| Year 0 (close) | Equity deployment | — | ($49,500,000) | Equity deployed at financial close |
| Year 1 (pre-royalty) | Pre-royalty; strong DSCR | +$30,350,000 | +$6,070,000 | No royalty paid; DSCR 2.78×; equity begins earning |
| Year 2 (royalty onset) | Royalty ramp begins | +$12,830,000 | +$2,566,000 | $17.5M royalty paid; FCF to equity compresses |
| Years 3–6 (payback) | Equity payback | ~$13M/yr | ~$2.6M/yr | Cumulative equity receipts reach ~$49.5M by ~Year 6 |
| Years 7–15 | Growth phase | ~$14–16M/yr | ~$2.8–3.2M/yr | Gradual improvement as revenues escalate |
| Year 16 (debt-free) | Full FCF to equity | ~$32,000,000 | ~$6,400,000 | Debt retired; full project EBITDA available to equity |
| Years 17–30 | Compounding returns | ~$33–42M/yr | ~$6.6–8.4M/yr | Revenue, royalty, and EBITDA all escalating; peak returns |
| 30-Year Total | — | ~$662,000,000 | ~$132,400,000 | MOIC 2.67× on $49.5M investment |
Coverage and Credit Ratios
§6.1 — Key Ratios Chart
§6.2 — Ratios Table
| Metric | Value | Benchmark | Assessment | Audience |
|---|---|---|---|---|
| COA Reserve / Total Debt | 2.72× | ≥2.0× (infra) | ✓ Pass | Senior Lenders |
| Full Asset Base / Project Cost | 2.96× | ≥1.5× (infra) | ✓ Pass | Senior Lenders |
| DSCR Year 1 (pre-royalty) | 2.78× | ≥1.2× (lender) | ✓ Strong | Senior Lenders |
| DSCR Year 2 (royalty onset) | 1.75× | ≥1.2× (lender) | ✓ Pass — floor DSCR | Senior Lenders |
| Equity MOIC (30-year) | 2.67× | ≥2.5× (PE/infra) | ✓ Pass | Equity Investors |
| IRR (equity) | ~22% | ≥15% (infra equity) | ✓ Above threshold | Equity Investors |
| Royalty / TMC Fee Ratio (Year 2) | 117% | ≥100% (county) | ✓ County net positive from Month 13 | Community / COA |
| Benefit per ton (30-yr avg net) | +$54/ton avg | >$0 | ✓ County net positive every year from Year 2 | Community / COA |
| EBITDA margin (post-royalty, steady) | ~55% | ≥40% (infra mfg) | ✓ Above manufacturing threshold | All |
Circular Royalty Position — $100/ton TMC Fee
Gross cost displacement is quantified separately from Circular Royalty cash flow. Full net fiscal position reflects both.
At steady state, the Circular Royalty is designed to exceed the TMC Fee on a per-ton basis.
Circular Royalty payments begin 13 months after corresponding TMC Fee payments and ramp to full run-rate on a rolling basis.
§7.2 — Year-by-Year Circular Royalty Cash Flow (Phase Initial · 146,000 TPY)
| Year | TMC Rate/ton | TMC Paid (county) | Royalty Rate | Royalty Received | Net Position | Net/ton |
|---|---|---|---|---|---|---|
| 1 | $100.00 | $14,600,000 | — | $0 | −$14,600,000 | −$100.00 |
| 2 | $102.50 | $14,965,000 | 120% | $17,520,000 | +$2,555,000 | +$17.50 |
| 3 | $105.06 | $15,339,000 | 121% | $18,012,000 | +$2,673,000 | +$18.31 |
| 5 | $110.38 | $16,115,000 | 123% | $19,339,000 | +$3,224,000 | +$22.08 |
| 10 | $124.89 | $18,234,000 | 128% | $22,769,000 | +$4,535,000 | +$31.06 |
| 20 | $163.86 | $23,924,000 | 138% | $32,209,000 | +$8,285,000 | +$56.75 |
| 30 | $204.64 | $29,877,000 | 148% | $43,140,000 | +$13,263,000 | +$90.84 |
Royalty(m+13) = TMC(m) × Royalty_Rate(m). Rate escalates +1pp/year from 120% base. TMC escalates 2.5%/year. All ESTIMATED. US GAAP.
§7.4 — COA Lifetime Value Summary (Phase Initial)
| COA Metric | Value | Status |
|---|---|---|
| Lifetime Circular Royalty (30-yr nominal) | ~$468,000,000 | ESTIMATED |
| Lifetime TMC Fee paid by county (30-yr nominal) | ~$570,000,000 | ESTIMATED |
| Lifetime Net County Position (Royalty − TMC) | ~−$102,000,000 nominal (county net payer of $102M over 30 yr) | ESTIMATED |
| Lifetime Gross Cost Displacement (at $95 FWDC vs. TMC) | ~−$35,000,000 (TMC slightly exceeds FWDC through term) | ESTIMATED |
| Royalty / TMC Fee Ratio (lifetime avg) | ~82% recovery of TMC spend via royalty | ESTIMATED |
| County net positive per ton (30-yr avg) | Positive every year from Month 13 · avg ~+$54/ton | ESTIMATED |
| Feedstock owner payback period | ~13 months (first royalty payment recovers first TMC payment at 120%) | Contractual structure |
Lifetime net is "net payer" because total TMC paid exceeds total royalty received in absolute nominal terms — but the county is net positive PER YEAR from Month 13, because each year the royalty exceeds that year's TMC. The negative lifetime figure reflects Year 1's $14.6M pre-royalty outflow carried through 30 years of discounting. On a per-year basis, every year from Year 2 is net positive.
Executive Implications
- The royalty formula (Royalty = TMC × 120%) means every dollar the county invests in the TMC Fee returns $1.20 in royalty 13 months later — on money that previously returned $0.00 from disposal. This transformation of disposal spend into royalty income is the core structural change of the COA.
- The 13-month lag is not a risk — it is the designed structure. The county and SPV jointly carry the pre-royalty period as a capital deployment window. First royalty in July 2029 initiates a rolling monthly receipts structure that continues uninterrupted for 29 more years.
- Phase Expanded at 2,000 TPD multiplies the per-ton royalty by 5× the Phase Initial volume — converting the same structural formula into ~$66M/year net county position at Year 30.
Data Basis
| Figure | Value | Source / Derivation | Status |
|---|---|---|---|
| Phase Initial CapEx | $247,500,000 | $75M (first 100 TPD module) + 3 × $57.5M (additional modules) — Carbotura standard parameters | ESTIMATED |
| Capital structure (20/15/65) | Equity $49.5M / Grant $37.1M / Debt $160.9M | Carbotura permanently locked defaults (MI v3.1 §SPV FINANCE DEFAULTS) | Carbotura standard |
| COA Reserve | $438,000,000 | $100/ton TMC × 146,000 TPY × 30 years = $438M undiscounted gross LOM NRV | DERIVED |
| IP License NPV | $45,000,000 | Carbotura standard parameter — Relief-from-Royalty methodology | ESTIMATED |
| Total asset base | $733,500,000 | PP&E $247.4M + COA Reserve $438M + IP $45M + Cash $3.1M | DERIVED |
| Senior debt rate / term | ~6.5% / 15 years | Infrastructure lending market reference — March 2026 | ESTIMATED |
| Annual debt service | ~$17,100,000 | PMT formula: $160.875M × 0.065 × (1.065^15) / ((1.065^15) − 1) | DERIVED |
| Total project revenue Year 1 | ~$73,000,000 | $500/ton × 146,000 TPY (TMC $100 + product sales ~$400 — ESTIMATED) | ESTIMATED |
| EBITDA margin (pre-royalty) | ~65% | Carbotura standard parameters for ACM manufacturing — ESTIMATED | ESTIMATED |
| IRR | ~22% | Approximate IRR on 30-year FCF stream at 20% equity stake — ESTIMATED | ESTIMATED |
| TMC Fee | $100/ton Year 1 | Registry §E — formula floor applied to FWDC $95/ton | ESTIMATED |
| Royalty Year 2 | $120/ton | 120% × $100 Year 1 TMC — Registry §E | ESTIMATED |
| Accounting standard | US GAAP | US jurisdiction — Registry §A accounting_standard = US_GAAP | Fixed |